10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

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

For the fiscal year ended December 31, 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 001-35945

EPIZYME, INC.

(Exact name of registrant as specified in its charter)

Delaware	26-1349956
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
400 Technology Square, 4th Floor Cambridge, Massachusetts	02139
(Address of principal executive offices)	(Zip code)

617-229-5872

(Registrant’s telephone number, including area code)

Securities 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, $0.0001 par value	EPZM	Nasdaq Global Select Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☒ Yes ☐ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. ☐ Yes ☒ No

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, a smaller reporting company, or an emerging growth company. See 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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes Oxley-Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report ☒

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

The aggregate market value of the registrant’s common stock, par value $0.0001 per share, held by non-affiliates of the registrant on June 30, 2020, the last business day of the registrant’s most recently completed second fiscal quarter, was approximately $794.6 million based on the closing price of the registrant’s common stock on the Nasdaq Global Select Market on that date.

The number of outstanding shares of the registrant’s common stock, par value $0.0001 per share, as of February 24, 2022 was 164,482,036.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s definitive proxy statement that the registrant intends to file with the Securities and Exchange Commission pursuant to Regulation 14A in connection with the registrant’s 2021 Annual Meeting of Stockholders are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent stated herein.

Epizyme, Inc.

Annual Report on Form 10-K for the Fiscal Year Ended December 31, 2021

Table of Contents

		Page
Item No.	PART I
Item 1.	Business	5
Item 1A.	Risk Factors	45
Item 1B.	Unresolved Staff Comments	89
Item 2.	Properties	89
Item 3.	Legal Proceedings	89
Item 4.	Mine Safety Disclosures	89
	PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	90
Item 6.	[Reserved]	91
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	92
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	112
Item 8.	Financial Statements and Supplementary Data	112
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	114
Item 9A.	Controls and Procedures	114
Item 9B.	Other Information	116
Item 9C.	Disclosure Regarding Foreign Jurisdictions That Prevent Inspections
	PART III
Item 10.	Directors, Executive Officers and Corporate Governance	117
Item 11.	Executive Compensation	117
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	117
Item 13.	Certain Relationships and Related Transactions, and Director Independence	117
Item 14.	Principal Accounting Fees and Services	117
	PART IV
Item 15.	Exhibits, Financial Statement Schedules	118
Item 16.	Form 10-K Summary	123
	Signatures	124

Epizyme® and TAZVERIK® are registered trademarks of Epizyme, Inc. in the United States and other countries. Epizyme, Inc. has also submitted trademark applications for Epizyme™ and for TAZVERIK™ in other countries. All other trademarks, service marks or other tradenames appearing in this Annual Report on Form 10-K are the property of their respective owners.

Forward-looking Information

This Annual Report on Form 10-K contains forward-looking statements that involve substantial risks and uncertainties. These statements may be identified by such forward-looking terminology as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” and similar statements or variations of such terms. Our forward-looking statements are based on a series of expectations, assumptions, estimates and projections about our company, are not guarantees of future results or performance and involve substantial risks and uncertainty. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in these forward-looking statements. Our business and our forward-looking statements involve substantial known and unknown risks and uncertainties, including the risks and uncertainties inherent in our statements regarding:

•our plans to research, develop and commercialize novel epigenetic therapies for patients with cancer;

•the ongoing commercialization of TAZVERIK;

•our sales, marketing and distribution capabilities and strategies, including for the commercialization and manufacturing of TAZVERIK and any future products;

•the rate and degree of market acceptance and clinical utility of TAZVERIK and any future products;

•our ongoing and planned clinical trials, including the timing of initiation and enrollment in the trials, the timing of availability of data from the trials and the anticipated results of the trials;

•the timing of and our ability to apply for, obtain and maintain regulatory approvals for tazemetostat in epithelioid sarcoma, follicular lymphoma and other indications, EZM0414 and any future product candidates;

•our ability to achieve anticipated milestones under our collaborations or to enter into additional collaborations;

•the impact of the COVID-19 pandemic on our business, results of operations, and financial condition;

•our intellectual property position;

•our ability to successfully implement and execute on our changes to our commercial strategy and organization, adjustments to our operating plans, including operating expense reductions, and leadership transitions; and

•our estimates regarding expenses, future revenue, capital requirements and needs for additional financing.

All of our forward-looking statements are made as of the date of this Annual Report on Form 10-K only. In each case, actual results may differ materially from such forward-looking information as a result of various important factors. We can give no assurance that such expectations or forward-looking statements will prove to be correct. An occurrence of or any material adverse change in one or more of the risk factors or risks and uncertainties referred to in this Annual Report on Form 10-K or included in our other public disclosures or our other periodic reports or other documents or filings filed with or furnished to the Securities and Exchange Commission could materially and adversely affect our business, prospects, financial condition and results of operations. Except as required by law, we do not undertake or plan to update or revise any such forward-looking statements to reflect actual results, changes in plans, assumptions, estimates or projections or other circumstances affecting such forward-looking statements occurring after the date of this Annual Report on Form 10-K, even if such results, changes or circumstances make it clear that any forward-looking information will not be realized. Any public statements or disclosures by us following this Annual Report on Form 10-K which modify or impact any of the forward-looking statements

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contained in this Annual Report on Form 10-K will be deemed to modify or supersede such statements in this Annual Report on Form 10-K.

Note regarding certain references in this Annual Report on Form 10-K

Unless otherwise stated or the context indicates otherwise, all references herein to “Epizyme,” “Epizyme, Inc.,” “we,” “us,” “our,” “our company,” “the Company” and similar references refer to Epizyme, Inc. and its wholly owned subsidiary, Epizyme Securities Corporation.

In addition, unless otherwise stated or the context indicates otherwise, all references in this Annual Report on Form 10-K to “TAZVERIK (tazemetostat),” “TAZVERIK” and “TAZVERIK” refer to tazemetostat in the context of the commercially-available product for which we received accelerated approval from the United States Food and Drug Administration in January 2020 for epithelioid sarcoma and in June 2020 for follicular lymphoma, as more fully described herein; whereas, unless otherwise stated or the context indicates otherwise, all references herein to “tazemetostat” refer to tazemetostat in the context of the product candidate for which we are exploring further applications and indications, as more fully described herein.

Risk Factors Summary

Our business is subject to a number of risks of which you should be aware in evaluating our company and our business. These risks are discussed more fully below in the “Risk Factors” section of this Annual Report on Form 10-K for the year ended December 31, 2021. These risks include the following:

•We are dependent on the successful development and commercialization of tazemetostat. If we do not successfully commercialize TAZVERIK for the indications for which TAZVERIK is approved or are unable to develop, obtain marketing approval of, and commercialize tazemetostat for additional indications, either alone or through collaborations, or if we experience significant delays in doing so, our business could be harmed.

•In connection with the accelerated approval of our epithelioid sarcoma, or ES, new drug application and our follicular lymphoma, or FL, supplemental NDA, continued approval of TAZVERIK for these approved indications is contingent upon verification and description of clinical benefit in a confirmatory program in each indication. We are conducting Phase 1b/3 trials to confirm the clinical benefit of TAZVERIK in each indication. These trials are expensive and time-consuming and may not confirm such benefit. If a confirmatory program does not verify clinical benefit for an indication, we may have to withdraw our accelerated approval for that indication, which could significantly harm our business.

•The marketing approval process is expensive, time-consuming and uncertain and we may be unable to obtain approvals for the commercialization of tazemetostat in the United States for any additional indication or in any foreign jurisdiction, or of EZM0414 or any other future product candidates we may develop. If we are not able to obtain, or if there are delays in obtaining, required marketing approvals of tazemetostat in the United States for any additional indication or in any foreign jurisdiction, or of EZM0414 or any other future product candidates we may develop, we will not be able to commercialize tazemetostat for such indications or in such foreign jurisdiction or such other future product candidates, and our ability to generate revenue will be materially impaired.

•The COVID-19 pandemic has impacted and may continue to impact our commercial launch efforts for TAZVERIK in FL and ES and has led to some delays in clinical trial startup, may affect our ability to initiate and complete preclinical studies and our ongoing and planned clinical trials, disrupt regulatory activities, further disrupt commercialization of TAZVERIK, or have other adverse effects on our business and operations.

•Tazemetostat,EZM0414 or any other future product candidate that we commercialize 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 tazemetostat, EZM0414 or any other future product candidate does not

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achieve an adequate level of acceptance, we may not generate significant product revenues and we may not become profitable.

•If we are unable to maintain effective sales, marketing and distribution capabilities, we may not be successful in commercializing tazemetostat or any other future product candidates that we commercialize.

•We face substantial competition, which may result in others discovering, developing or commercializing products before or more successfully than we do. Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than tazemetostat for ES, FL or any other indication for which we may develop tazemetostat or any other future product candidates that we may commercialize.

•Tazemetostat and any other future product candidate that we commercialize may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives, which could adversely impact the product revenues we may generate from tazemetostat or such other future product candidate and harm our business.

•Our research and development is focused on the creation of novel epigenetic therapies for patients with cancer, which is a rapidly evolving area of science, and the approach we are taking to discover and develop drugs is novel.

•Clinical drug development is a lengthy and expensive process, with an uncertain outcome. We are conducting multiple clinical trials of tazemetostat in different potential indications as a monotherapy and in combination with other products. A failure of one or more of these clinical trials can occur at any stage of testing. The outcome of preclinical testing and early clinical trials may not be predictive of the success of later clinical trials, the outcome of a clinical trial for an indication may not be predictive of the success of clinical trials for other indications, 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.

•If we are required by the U.S. Food and Drug Administration, or FDA, to obtain approval of a companion or complementary diagnostic in connection with approval of a therapeutic product, and there are delays in obtaining such FDA approval of a diagnostic device, we will not be able to commercialize the product candidate and our ability to generate revenue will be materially impaired.

•We may not be successful in our efforts to use and expand our proprietary drug discovery platform to build or advance a pipeline of future product candidates.

•Our existing therapeutic collaborations are important to our business and provide us with resources and capabilities we may not otherwise have. If we are unable to enter into additional therapeutic collaborations on acceptable terms or at all or maintain any of these collaborations, or if these collaborations are not successful, our business could be adversely affected.

•We contract with third parties for the manufacture of tazemetostat for commercialization and clinical testing, and expect to contract with third parties for the manufacture of any other future product candidates that we develop for preclinical and clinical testing and commercialization. This reliance on third parties increases the risk that we will not have sufficient quantities of tazemetostat or other future product candidates or such quantities at an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts.

•Our success depends in large part on our ability to obtain and maintain patent protection in the United States and other countries with respect to our proprietary technology and products. If we are unable to obtain and maintain patent protection for our technology and products or if the scope of the patent protection obtained is not sufficiently broad, our competitors could develop and commercialize technology and products similar or identical to ours, and our ability to successfully commercialize our technology and products may be impaired.

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

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•We will need substantial additional funding to maintain and grow our operations. If we are unable to raise capital when needed or on acceptable terms, we could be forced to delay, reduce or eliminate our research and development programs or our commercialization efforts.

•Our changes to our commercial strategy and organization, adjustments to our operating plans, including operating expense reductions, prioritization of development activities and leadership transitions may not be successful, may not result in accelerated commercial adoption of TAZVERIK and greater product revenues or anticipated savings, could result in total costs and expenses that are greater than expected, could result in us forgoing business opportunities and could disrupt our business.

•We have incurred secured indebtedness of $220.0 million under our amended and restated loan agreement with BioPharma Credit Investments V (Master) LP, BPCR Limited Partnership and BioPharma Credit PLC. Our debt service obligations could limit cash flow available for our operations and expose us to risks that could adversely affect our business, financial condition and results of operations. In the event of a default of our obligations under the loan agreement, we may not have sufficient funds or the ability to raise capital to repay our indebtedness.

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PART I

Item 1. Business

Note on the COVID-19 Pandemic

The ongoing COVID-19 pandemic continues to have widespread, evolving, and unpredictable impacts on global economies, financial markets, business practices and societies. We are closely monitoring the impact of the COVID-19 pandemic and related developments on our business, operations and financial performance. Our focus remains on continuing to advance our efforts with respect to the commercialization of TAZVERIK® and to continue to advance the development of our pipeline, while making the health and safety of our employees and their families, healthcare providers, patients and communities a top priority. We believe that the COVID-19 pandemic has had an adverse impact on sales of TAZERIK and the initiation of clinical trials since the June 2020 FDA approval of TAZVERIK for follicular lymphoma, or FL. Due to the evolving and uncertain global impacts of the COVID-19 pandemic, however, we cannot precisely determine or quantify the impact that this pandemic has had on our business, operations and financial performance to date or the impact that this pandemic will have in 2022 and beyond. Please see “Risk Factors” in Part I, Item 1A and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of this Annual Report on Form 10-K for further discussion regarding the impact and the risk of the COVID-19 pandemic on our business, operations and financial performance.

Overview

We are a commercial-stage biopharmaceutical company that is committed to rewriting treatment for people with cancer through the discovery, development, and commercialization of novel epigenetic medicines. We aspire to change the standard of care for patients and physicians by developing targeted medicines with fundamentally new mechanisms of action directed at specific causes of hematological malignancies and solid tumors.

We have one approved product, TAZVERIK (tazemetostat), which was granted accelerated approval by the U.S. Food and Drug Administration, or FDA, in 2020 for epithelioid sarcoma, or ES, and FL. Our focus is on maximizing our effectiveness as a commercial organization to achieve adoption of TAZVERIK among as many appropriate patients as possible, including in earlier treatment lines and in combination regimens with the data to support this expanded use; building on TAZVERIK’s pipeline-in-a-drug potential; and expanding our pipeline and evolving oncology portfolio, including with SET-101, our first-in-human Phase 1/1b trial of EZM0414, our novel, first-in-class, oral SETD2 inhibitor. We are leveraging our drug discovery platform and expertise as a leader in epigenetics, as well as our team’s deep experience across clinical development and commercialization to execute on our strategy.

In January 2020, the FDA granted accelerated approval of TAZVERIK (tazemetostat), an oral, first in class, selective small molecule inhibitor of the EZH2 histone methyltransferase, or HMT, for the treatment of adult and pediatric patients aged 16 years and older with metastatic or locally advanced ES not eligible for complete resection. This approval was based on overall response rate and duration of response data shown in the ES cohort of our Phase 2 trial in patients with INI1-negative tumors. We continue to make TAZVERIK available to eligible patients and their physicians in the United States.

As part of the accelerated approval for ES, continued approval for this indication is contingent upon verification and description of clinical benefit in a confirmatory trial. To provide this confirmatory evidence to support a full approval of TAZVERIK for this indication, we are conducting a single, randomized, controlled Phase 1b/3 confirmatory trial in the United States (EZH-301) assessing tazemetostat in combination with doxorubicin compared with doxorubicin plus placebo as a front-line treatment for ES. The trial is expected to enroll approximately 152 patients. We have completed the planned enrollment in the Phase 1b safety run-in portion of the trial, and the Phase 3 efficacy portion of the trial is open for accrual. We reported safety and preliminary activity data from the patients in the safety run-in portion of the EZH-301 trial at the American Society of Clinical Oncology (ASCO) Annual Meeting in June 2021.

In June 2020, the FDA approved a supplemental New Drug Application, or sNDA, for TAZVERIK for adult patients with relapsed or refractory (R/R) FL whose tumors are positive for an EZH2 mutation as detected by an FDA-approved test and who have received at least two prior systemic therapies, and adult patients with R/R FL who have no satisfactory alternative treatment options. These indications were approved under accelerated approval with

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a priority review, based on overall response rate and duration of response data shown in the FL cohorts of our Phase 2 clinical trial in patients with EZH2 mutations and wild-type EZH2. We continue to make TAZVERIK available to eligible patients and their physicians in the United States.

As part of the accelerated approval for FL, continued approval for these R/R FL indications is contingent upon verification and description of clinical benefit in a confirmatory trial. To provide this confirmatory evidence to support a full approval of TAZVERIK for these indications, we are conducting a single global, randomized, adaptive Phase 1b/3 confirmatory trial (EZH-302, SYMPHONY-1) assessing the combination of tazemetostat with “R2” (lenalidomide and rituximab), an approved chemotherapy-free treatment regimen, compared with R2 plus placebo for R/R FL patients in the second-line or later treatment setting. We plan to leverage the confirmatory trial and also conduct post-marketing commitments to expand the TAZVERIK label into the second-line treatment setting.

In December 2021 we presented updated safety and activity data from the Phase 1b safety run-in portion of this confirmatory trial at the 2021 American Society of Hematology (ASH) Annual Meeting. We continue to follow the 40 patients in the Phase 1b safety run-in portion of the trial, and we expect to present follow-up data from the safety run-in portion of the trial at a medical conference later in 2022.

We expect that the Phase 3 portion of the SYMPHONY-1 trial will be a global, randomized and adaptive confirmatory trial in 500 patients. Based on the Phase 1b safety run-in results, in December 2021 we submitted a protocol amendment to the FDA with 800 mg twice-daily as the recommended tazemetostat dose (RP3D) for the Phase 3 portion of the trial. After completing the 30-day voluntary waiting period following submission of the protocol amendment for 800 mg RP3D without any objection from the FDA, and as we continue to conduct the Phase 1b safety run-in portion of the trial, we have accelerated global start-up activities and are activating as many study sites as possible, globally, for the Phase 3 portion of the trial. The primary endpoint for the Phase 3 portion of the trial will be based on progression free survival as determined by investigator. Based on discussions with the FDA, this portion of the trial will include two interim analyses, the first of which is for futility only and the second of which will be conducted for futility, and if 65% of progression free survival events have occurred, the trial will also include an efficacy evaluation. In July 2021 China’s Center for Drug Evaluation, or CDE, approved the Investigational New Drug Application, or IND, we filed in China for SYMPHONY-1. We are currently screening patients in the Phase 3 portion of this trial and we expect to enroll the first patient in the Phase 3 portion of this trial in the first quarter of 2022.

Through our planned development efforts, including the following trials, our intention is to eventually make TAZVERIK available in all lines of treatment for patients with FL.

•In collaboration with The Lymphoma Study Association, or LYSA, and based on clinical activity observed with tazemetostat in combination with R-CHOP (rituximab, cyclophosphamide, doxorubicin, vincristine and prednisolone) as a front-line treatment for patients with high risk diffuse large B-cell lymphoma, or DLBCL, LYSA is conducting a Phase 1b/2 clinical trial to evaluate this combination as a front-line treatment for high-risk patients with FL and DLBCL. Patient enrollment in the Phase 2 portion of this trial is now nearly complete with 111 patients out of a target of approximately 122 patients in DLBCL and 61 patients out of a target of approximately 62 patients in FL enrolled as of February 23, 2022. We expect that interim results from the Phase 2 portion of this trial will be presented at a medical conference in the second half of 2022.

•In addition, we are finalizing plans for investigator-sponsored studies to evaluate tazemetostat in combination with venetoclax or BTK inhibitors for the treatment of patients with FL in the third-line or later treatment settings.

We are also developing tazemetostat for the treatment of a broad range of other cancer types in multiple treatment settings. Tazemetostat has shown meaningful clinical activity as an investigational monotherapy in multiple cancer indications and has been generally well-tolerated across clinical trials to date. We believe tazemetostat is a “pipeline in a product” opportunity and plan to explore its potential utility in additional indications and combinations.

There are four areas where we see the greatest potential for tazemetostat, all of which are based on a strong scientific hypothesis and are for patients suffering from diseases that would benefit from a new effective and safe treatment option, including:

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•Lymphomas and B-cell malignancies, such as DLBCL, mantle cell lymphoma, or MCL, multiple myeloma and others;

•Molecularly defined solid tumors, such as chordoma, melanoma, mesothelioma, and tumors harboring an EZH2 or SWI/SNF alteration;

•PARPi-resistant tumors, such as castration-resistant prostate cancer, small cell lung cancer, and others; and

•Immuno-oncology sensitive tumors, such as small cell lung cancer, prostate cancer, and others.

As part of these broader tazemetostat development efforts, we are evaluating tazemetostat for the treatment of prostate cancer. We are conducting a global, multi-center, open-label, randomized Phase 1b/2 trial (EZH-1101, CELLO-1) evaluating tazemetostat in combination with enzalutamide or abiraterone plus prednisone, the standard of care treatments for metastatic castration-resistant prostate cancer, or mCRPC. As of February 2021, we had completed enrollment in the Phase 1b safety run-in portion of CELLO-1 with a total of 21 men with mCRPC. In September 2021, at the European Society for Medical Oncology (ESMO) Congress, we announced preliminary data from the Phase 1b safety run-in portion of the trial with a data cutoff date of July 22, 2021. We continue to follow patients from the Phase 1b portion of the study, and we expect to present updated data from these patients in the second half of 2022. Based on early safety and activity findings observed in the Phase 1b safety run-in portion of CELLO-1, in the first quarter of 2021 we initiated enrollment in the Phase 2 efficacy portion of CELLO-1 evaluating tazemetostat in combination with enzalutamide compared to enzalutamide alone, and we expect to include 80 men with mCRPC in this Phase 2 portion of the trial. The primary endpoint for CELLO-1 is radiographic progression free survival. The Phase 2 efficacy portion of the trial is approximately 75% enrolled toward the target of 80 patients, and we expect to complete enrollment in the Phase 2 portion of the trial in 2022. We plan to provide updated data from the safety run-in portion of the trial as well as interim data from the Phase 2 portion of the trial in the second half of 2022.

To efficiently evaluate tazemetostat’s potential safety and efficacy across multiple types of hematological malignancies, we initiated a signal-finding Phase 1b/2 basket study (EZH-1501) evaluating tazemetostat with multiple combinations in hematological malignancies in December 2021 and we are actively screening patients for enrollment in this study. In the conduct of EZH-1501, we plan to study multiple combinations with standard of care therapies and novel mechanisms of action as we seek to expand the potential of TAZVERIK to patients with hematological malignancies and the physicians who treat them. We plan to provide updates as EZH-1501 reaches key enrollment milestones and we plan to provide preliminary data from EZH-1501 in the second half of 2022.

On March 1, 2022, we announced a pipeline reprioritization. Given the breadth of our current tazemetostat clinical development program, we have discontinued enrollment in our Phase 2 study of tazemetostat in combination with rituximab with FL in the third-line or later treatment settings (SYMPHONY-2, EZH-1401), as well as in our Phase 1/1b basket study evaluating tazemetostat combinations in patients with solid tumors (EZH-1301). We have enrolled five patients in the EZH-1401 study and one patient in the EZH-1301 study and plan to continue to follow the patients currently enrolled in each of these two studies. The decision to discontinue these studies was based on evolving market dynamics and a continued focus on optimizing our investments and eliminating potentially overlapping studies. We continue to study tazemetostat in combination with other therapies for both hematologic and solid tumor malignancies, both in ongoing Company-sponsored studies as well as investigator-initiated studies.

We own the global development and commercialization rights to tazemetostat outside of Japan and greater China. Eisai Co. Ltd, or Eisai, holds the rights to develop and commercialize tazemetostat in Japan, and Hutchison China MediTech Investment Limited, or HutchMed, holds certain rights to develop and commercialize tazemetostat in greater China.

TAZVERIK is available to eligible patients in the United States via a specialty distribution network. Through this specialty distribution network, we sell TAZVERIK principally to a limited number of specialty pharmacies, which dispense the product directly to patients, and specialty distributors, which in turn sell the product to hospital pharmacies and community practice pharmacies for the treatment of patients. To commercialize TAZVERIK for the approved ES and FL indications in the United States, we have built a focused field presence and marketing capabilities.

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On August 7, 2021, we entered into a strategic collaboration pursuant to a license agreement with HutchMed through which we granted a license to HutchMed for the co-exclusive (with us) development and exclusive commercialization of tazemetostat, either as monotherapy or as a part of combinations with other therapies, including HutchMed proprietary compounds, agreed by us and HutchMed for the treatment of ES, FL and DLBCL in humans, and any additional indications agreed to by us and HutchMed in mainland China, Taiwan, Hong Kong and Macau, or the HutchMed Territory.

For other geographies outside the United States, we are evaluating the most efficient path to obtain marketing approval, commercialize and distribute TAZVERIK to reach patients, including pursuing potential strategic collaborations. Based on comparators and the regulatory landscape, we have decided not to pursue marketing approval of tazemetostat as monotherapy from the European Medicines Agency, or EMA at this time.

Tazemetostat is covered by claims of U.S. and European composition of matter patents, which are expected to expire in 2032, exclusive of any patent term or other extensions. Tazemetostat has been granted Fast Track designation by the FDA in patients with relapsed or refractory FL, relapsed or refractory DLBCL with EZH2 activating mutations and metastatic or locally advanced ES who have progressed on or following an anthracycline-based treatment regimen. The FDA has also granted orphan drug designation to tazemetostat for the treatment of patients with malignant rhabdoid tumors, soft tissue sarcoma, and mesothelioma, and a seven-year orphan drug exclusivity period from the dates of our respective approvals of TAZVERIK for the treatment of patients with ES and for the treatment of patients with FL.

Beyond tazemetostat, we are utilizing our drug discovery platform to progress preclinical efforts and discover and identify additional product candidates to expand our pipeline of inhibitors against several classes of chromatin modifying proteins, or CMPs, including HMTs, histone acetyltransferases, or HATs, and helicases.

Our most advanced product candidate, EZM0414, is a novel first-in-class oral inhibitor of the SETD2 HMT.

SETD2 is an HMT that plays multiple important roles in oncogenesis. Based on the potential of SETD2 inhibition demonstrated in multiple preclinical settings, including multiple myeloma, and in particular high risk t(4;14) multiple myeloma and in other B-cell malignancies such as DLBCL, as well as in combination with existing and emerging therapies including tazemetostat, we submitted an IND for EZM0414 to the FDA in July 2021. We received “study may proceed” from the FDA with respect to our IND for EZM0414 in July 2021. In October 2021, EZM0414 was granted Fast Track designation by the FDA in adult patients with relapsed or refractory DLBCL and in January 2022 we received orphan drug designation from the FDA for EZM0414 for the treatment of multiple myeloma. In the fourth quarter of 2021, we initiated a Phase 1/1b trial (SET-101) intended to evaluate the safety and optimize the dose and schedule of EZM0414 in R/R multiple myeloma and DLBCL patients. The Phase 1 portion of our SET-101 trial is a 3 + 3 dose escalation design and includes six planned dose levels ranging from 100 mg to 900 mg once daily. Once we have optimized the dose, we then expect to expand the trial to two patient cohorts in multiple myeloma: t(4;14) multiple myeloma and non t(4;14) multiple myeloma. Based on dose optimization data from the trial, we may add a third patient cohort in DLBCL. We are screening patients with one site open for the Phase 1 dose escalation portion of the SET-101 trial, which we expect will enroll between 30-36 patients. We plan to provide updates as the trial reaches key enrollment milestones along with preliminary data from the trial in 2022.

To date we have entered into various strategic collaborations, including with Eisai, HutchMed, Roche and other third parties. As one of several key aspects of our strategy, we plan to continue to leverage our existing collaborations and to seek to identify new potential strategic collaborations to further support and grow our business in and outside of the United States.

Our Corporate Strategy

We are a commercial-stage biopharmaceutical company that is committed to rewriting treatment for people with cancer through the discovery, development and commercialization of novel epigenetic medicines. We aspire to change the standard of care for patients and physicians by developing targeted medicines with fundamentally new mechanisms of action directed at specific causes of hematological malignancies and solid tumors.

Our corporate strategy is focused on four critical imperatives that we refer to as The Next EPIsode: Rewriting Oncology Treatment with Epigenetics:

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•Maximize our effectiveness as a commercial organization to achieve adoption of TAZVERIK among as many FL and ES patients as possible, including in earlier treatment lines and in combination regimens with the data to support this potential expanded use;

• Build on TAZVERIK’s pipeline-in-a-drug potential, demonstrating tazemetostat’s benefit in additional hematological malignancies and solid tumors;

• Expand our pipeline and evolving oncology portfolio, bringing novel oncology therapeutics into clinical development to maintain our position as a leader in epigenetics; and

•Leverage options to expand patient reach, including through commercial, clinical and research collaborations.

TAZVERIK (tazemetostat) for Epithelioid Sarcoma

In January 2020, the FDA granted accelerated approval of TAZVERIK (tazemetostat) for the treatment of adults and pediatric patients aged 16 years and older with metastatic or locally advanced ES not eligible for complete resection. This approval was based on overall response rate and duration of response shown in an open-label, single-arm cohort of a multi-cohort, global Phase 2 trial of tazemetostat in adults with INI1-negative tumors. The cohort was conducted in 62 patients with histologically confirmed, metastatic or locally advanced ES. Patients were required to have INI1 loss, detected using local tests, and an Eastern Cooperative Oncology Group performance status, or ECOG PS, of 0-2. Patients in the cohort received TAZVERIK 800 mg orally twice daily until disease progression or unacceptable toxicity. Tumor response assessments were performed every eight weeks. The major efficacy outcome measures were confirmed overall response rate, or ORR, according to Response Evaluation Criteria in Solid Tumors, or RECIST, v1.1, as assessed by blinded independent central review, and duration of response. Median duration of follow-up was 14 months (range 0.4 to 31).

Among the 62 patients who received TAZVERIK, the median age was 34 years (range 16 to 79); 63% were male, 76% were White, 11% were Asian, 44% had proximal disease, 92% had an ECOG PS of 0 or 1, and 8% had an ECOG PS of 2. Prior surgery occurred in 77% of patients; 61% received prior systemic chemotherapy.

In the total of 62 patients treated, the overall response rate (95% confidence interval) was 15% (7%, 26%), with 1.6% of patients achieving a complete response and 13% achieving a partial response. Among responders in the trial, 67% had a duration of response of six months or longer as of the data cutoff date of September 17, 2018.

Serious adverse reactions occurred in 37% of patients receiving TAZVERIK. The serious adverse reactions in ≥3% of patients who received TAZVERIK were hemorrhage, pleural effusion, skin infection, dyspnea, pain, and respiratory distress.

One patient (2%) permanently discontinued TAZVERIK due to an adverse reaction of altered mood.

Dosage interruptions due to an adverse reaction occurred in 34% of patients who received TAZVERIK. The most frequent adverse reactions requiring dosage interruptions in ≥3% of patients were hemorrhage, increased alanine aminotransferase (ALT), and increased aspartate aminotransferase (AST). Dose reduction due to an adverse reaction occurred in one (2%) patient who received TAZVERIK due to decreased appetite.

The most common adverse reactions (≥20%, any grade) were pain, fatigue, nausea, decreased appetite, vomiting, and constipation.

The label for TAZVERIK includes warning and precautions for the increase in risk of developing secondary malignancies following treatment with TAZVERIK and the risk of embryo fetal toxicity when administered to pregnant women.

The Lancet Oncology published results of our Phase 2 trial evaluating TAZVERIK for the treatment of ES in October 2020.

We continue to make TAZVERIK available to eligible patients and their physicians in the United States.

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Background on ES: Epithelioid sarcoma is an ultra-rare and aggressive type of soft tissue sarcoma, comprising less than 1 percent of all soft tissue sarcoma cases, and is characterized by a loss of the INI1 protein. It is most commonly diagnosed in young adults (20-40 years old) and is often fatal. There is no established standard-of-care for treating these patients, who are typically resistant to chemotherapy. Patients diagnosed with metastatic disease typically have a 5-year overall survival rate of zero percent and there are no approved treatment options specifically indicated for ES other than TAZVERIK. Typically, once patients have been deemed appropriate for systemic therapy, most are treated with chemotherapy. There are an estimated 800 patients in the United States living with ES with approximately 300 patients with metastatic or locally advanced disease that are eligible for systemic therapy.

TAZVERIK for Epithelioid Sarcoma Post-Marketing Requirements
 

Confirmatory Trial. As part of the accelerated approval for ES, continued approval for this indication is contingent upon verification and description of clinical benefit in a confirmatory trial. To provide this confirmatory evidence to support a full approval of TAZVERIK for this indication, we are conducting a 1:1 randomized, controlled Phase 1b/3 clinical trial in the United States in the front-line treatment setting comparing tazemetostat in combination with doxorubicin, a commonly used systemic treatment in this setting, versus placebo plus doxorubicin. The trial is expected to enroll approximately 152 ES patients. The primary efficacy endpoint of the Phase 3 portion of the trial is progression-free survival, and secondary efficacy endpoints include overall survival, disease control rate, overall response rate, duration of response and health-related quality of life. We have completed the planned enrollment in the Phase 1b safety run-in portion of the trial, and the Phase 3 efficacy portion of the trial is open for accrual. We reported safety and preliminary activity data from patients in the safety run-in portion of the trial at the ASCO annual meeting in June 2021.

We have several additional post-marketing activities underway, intended to address aspects of the label in the future. These include clinical pharmacology evaluations to assess the effect of TAZVERIK on liver function and the effect of CYP3A inhibitors and inducers on TAZVERIK for patients with ES. We have also expanded enrollment in a cohort of our Phase 2 study in adults with INI1-negative tumors, to enroll a total of at least 60 ES patients. The cohort is a paired biopsy cohort designed to assess potential immune biomarkers, and the expansion is intended to provide more experience in patients with ES.

TAZVERIK for Follicular Lymphoma

In June 2020, the FDA approved an sNDA for TAZVERIK for the following FL indications: (1) adult patients with relapsed or refractory FL whose tumors are positive for an EZH2 mutation as detected by an FDA-approved test and who have received at least two prior systemic therapies, and (2) adult patients with relapsed or refractory FL who have no satisfactory alternative treatment options. These indications were approved under accelerated approval with a priority review, based on overall response rate and duration of response shown in the FL cohorts of our Phase 2 clinical trial in patients with EZH2 mutations and wild-type EZH2.

TAZVERIK was evaluated in an open-label, single-arm, multi-center Phase 2 clinical trial in patients with histologically confirmed FL whose disease had progressed following at least two prior systemic treatment regimens. Patients were enrolled into two cohorts: one cohort enrolled 45 patients with EZH2 activating mutations and a second cohort enrolled 54 patients with wild-type EZH2. All patients were treated with 800 mg of tazemetostat, administered orally twice a day. The major efficacy outcome measures were overall response rate (ORR) and duration of response (DOR) according to the International Working Group Non-Hodgkin Lymphoma (IWG-NHL) criteria (Cheson 2007) as assessed by Independent Review Committee. Median duration of follow-up was 22 months for patients with EZH2 activating mutations and 36 months for patients with wild-type EZH2.

Among the 45 FL patients with an EZH2 activating mutation who received TAZVERIK, the median age was 62 years (range 38 to 80); 42% were male; 42% had early progression following front-line therapy (POD24); and all had an ECOG PS of 0 or 1. The median number of lines of prior systemic therapy was 2.0 (range 1 to 11); 49% were refractory to rituximab and 49% were refractory to their last therapy. In the 42 patients treated with at least two prior systemic therapies, the ORR (95% confidence interval) was 69% (53%, 82%), with 12% of patients achieving a complete response and 57% achieving a partial response. The median DOR was 10.9 months and ongoing.

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Among the 54 FL patients with wild-type EZH2 who received TAZVERIK, the median age was 61 years (range 36 to 87); 63% were male; 59% had POD24; and 91% had an ECOG PS of 0 or 1. The median number of lines of prior systemic therapy was 3.0 (range 1 to 8); 59% were refractory to rituximab and 41% were refractory to their last therapy. In the 53 patients treated with at least two prior systemic therapies, the ORR (95% confidence interval) was 34% (22%, 48%), with 4% of patients achieving a complete response and 30% achieving a partial response. The median DOR was 13.0 months.

Serious adverse reactions, irrespective of attribution, occurred in 30% of patients receiving TAZVERIK. Serious adverse reactions in ≥2% of patients who received TAZVERIK were general physical health deterioration, abdominal pain, pneumonia, sepsis, and anemia. The most common (≥20%) adverse reactions were fatigue, upper respiratory tract infection, musculoskeletal pain, nausea and abdominal pain.

Eight patients (8%) discontinued due to adverse reaction during the trial. There were no reported deaths on study, and no black box warnings or contraindications.

The Lancet Oncology published in October 2020 results of our Phase 2 trial evaluating TAZVERIK for the treatment of FL.

We continue to make TAZVERIK available to eligible patients and their physicians in the United States.

Background on FL: Follicular lymphoma is the most common indolent lymphoma and the second most common non-Hodgkin lymphoma – accounting for about 10-20% of all lymphomas in Western countries. FL is considered to be incurable with existing treatments and is characterized by cycles of relapse that become increasingly difficult to treat with each disease progression. We estimate that approximately 14,000 patients are diagnosed with FL in the United States annually, of whom the majority have advanced disease at diagnosis. We estimate that there are approximately 10,000 patients with relapsed and/or refractory disease in the United States. Based on literature and an extensive natural history study that we conducted, we believe that approximately 20% of FL tumors carry an EZH2 activating mutation. Common treatments for FL include multi-agent chemotherapy, usually combined with rituximab (Rituxan), including R-CHOP and R-Bendamustine. Upon clinical progression, treatment regimens are typically other combinations of rituximab, and other chemotherapy regimens, utilization of off-label agents, clinical trials, or one of the two approved PI3k inhibitors: copanlisib or umbralisib, or one approved CAR-T therapy: YESCARTA.

TAZVERIK for Follicular Lymphoma Post-Marketing Requirements

As part of the accelerated approval for FL, continued approval for these indications is contingent upon verification and description of clinical benefit in a confirmatory trial. To provide this confirmatory evidence to support a full approval of TAZVERIK for these indications, we are conducting a single global, randomized, adaptive Phase 1b/3 confirmatory trial (EZH-302, SYMPHONY-1) assessing the combination of tazemetostat with “R2” (lenalidomide plus rituximab), an approved chemotherapy-free treatment regimen, compared with R2 plus placebo for FL patients in the second-line or later treatment setting.

In December 2021 we presented updated safety and activity data from the Phase 1b safety run-in portion of this confirmatory trial at the 2021 ASH Annual Meeting, which included 40 FL patients who had received treatment with tazemetostat and R2, including patients at the 400 mg tazemetostat twice daily dosing regimen [n=4], the 600 mg tazemetostat twice daily dosing regimen [n=18] and the 800 mg tazemetostat twice daily dosing regimen [n=18], as of a September 29, 2021 data cutoff date. Through the September 29, 2021 data cutoff date, the safety profile observed in the patients in the 400 mg, 600 mg and 800 mg dose cohorts was consistent with safety information in the prescribing information for the individual tazemetostat and R2 package inserts, respectively. Additionally, there was no clear dose response for treatment-emergent adverse events, or TEAEs, or dose modifications. Thirty-five (35) of the 40 patients were evaluable for tumor assessments as of the data cutoff date. Thirty-two (32) patients responded to treatment, with 13 patients, or 37.1 percent, having a complete response, and 19 patients, or 54.3 percent, having a partial response, for an overall response rate of 91.4 percent. The duration of response data continue to mature as the Phase 1b safety run-in portion of the trial is ongoing. We continue to follow the 40 patients in the Phase 1b safety run-in portion of the trial and we expect to present follow-up data from the safety run-in portion of the trial at a medical conference later in 2022.

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We expect that the Phase 3 portion of the SYMPHONY-1 trial will be a global, randomized and adaptive confirmatory trial in approximately 500 FL patients, stratified based on their EZH2 mutation status. Based on the Phase 1b safety run-in results, in December 2021 we submitted a protocol amendment to the FDA with 800 mg twice-daily as the recommended tazemetostat dose for the Phase 3 portion of the trial. After completing the 30-day voluntary waiting period following submission of the protocol amendment for the 800 mg RP3D without any objection from the FDA, and as we continue to conduct the Phase 1b safety run-in portion of the trial, we have accelerated global start-up activities and are activating as many study sites as possible, globally, for the Phase 3 portion of the trial. The primary endpoint for the Phase 3 portion of the trial will be based on progression free survival as determined by investigator. Based on discussions with the FDA, this portion of the trial will include two interim analyses, the first of which is for futility only and the second of which will be conducted for futility, and if 65% of progression free survival events have occurred, the trial will also include an efficacy evaluation. In July 2021 China’s Center for Drug Evaluation, or CDE, approved the IND we filed in China for SYMPHONY-1. We are currently screening patients in the Phase 3 portion of this trial and we expect to enroll the first patient in the Phase 3 portion of this trial in the first quarter of 2022.

In addition, we continue to engage with the FDA regarding the conduct of additional post-marketing commitments, including with respect to the design of clinical trials in FL patients with wild-type EZH2 to evaluate tazemetostat as a monotherapy in patients who have been treated with at least one prior systemic treatment, in order to inform the label and potentially expand in the relapsed and refractory setting in the future.

FL Development Expansion: Through our planned development efforts, our intention is to make TAZVERIK available in all lines of treatment for patients with FL. We plan to leverage the confirmatory trial and post-marketing commitments to expand TAZVERIK into the second-line treatment setting.

In collaboration with LYSA and based on clinical activity observed with tazemetostat in a combination Phase 1b/2 study with R-CHOP as a front-line treatment for patients with high risk DLBCL, in the fourth quarter of 2016 LYSA commenced a multi-center Phase 1b/2 trial of tazemetostat in combination with R-CHOP in front-line, elderly high-risk patients with DLBCL. Primary endpoints in the trial include complete response rate, safety and tolerability of the combination. Secondary endpoints include ORR and progression-free survival, or PFS. At ASH 2018, LYSA reported interim data from 17 patients in the trial as of March 2018 showing that the combination of the two agents had been generally well-tolerated and confirming the recommended tazemetostat dose for the combination to be 800 mg twice-daily. Clinical activity was observed, with 87 percent of patients experiencing a metabolic complete response. We agreed in 2020 to expand the trial to also include an expansion cohort for the front-line treatment of high-risk patients with FL. The Phase 1b part of the study has completed. Patient enrollment in the Phase 2 portion of this trial is now nearly complete with 111 patients out of a target of approximately 122 patients in DLBCL and 61 patients out of a target of approximately 62 patients in FL enrolled as of February 23, 2022. We expect that interim results from the Phase 2 portion of this trial will be presented at a medical conference in the second half of 2022.

In addition, we are finalizing plans for investigator-sponsored studies to evaluate tazemetostat in combination with venetoclax or BTK inhibitors for the treatment of patients with FL in the third-line or later treatment settings.

Tazemetostat Life-Cycle Development

Tazemetostat has shown meaningful clinical activity as an investigational monotherapy in multiple cancer indications and has been generally well-tolerated across clinical trials to date. We believe tazemetostat is a “pipeline in a product” opportunity and plan to explore its utility in additional indications and combinations through both Company- and investigator-sponsored studies. There are four areas where we see the greatest potential for tazemetostat, all of which are based on a strong scientific hypothesis and are for patients suffering from diseases that would benefit from a new effective and safe treatment option.

Lymphomas and B-Cell Malignancies

We are developing tazemetostat for lymphomas and B-cell malignancies, including DLBCL, MCL, multiple myeloma and others, because of the role EZH2 plays in B-cell biology. When oncogenic mutations occur, they can “lock” B-cells in the germinal center state, leading to a variety of hematologic cancers. Regardless of the oncogenic mutation, these cancer cells are governed by EZH2 expression, which enables their growth and proliferation. By inhibiting EZH2, we believe we can inhibit tumor proliferation, leading to anti-tumor activity, as seen in FL patients with wild-type EZH2.

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Molecularly Defined Solid Tumors

We are exploring the use of tazemetostat to treat multiple molecularly defined solid tumors, such as chordoma, melanoma, mesothelioma and tumors with a SWI/SNF alteration or other mutations. In these tumors, a loss of certain proteins or the presence of a certain mutation have been shown to result in abnormal EZH2 activity or exaggerated dependence on EZH2, which typically leads to cancer cell growth. By inhibiting EZH2 with tazemetostat, we believe we can inhibit that abnormal function, thereby indirectly restoring cells to their natural state, which we believe has the potential to result in a therapeutic benefit.

PARPi-Resistant Tumors

We are assessing the use of tazemetostat for PARPi-resistant solid tumors that are resistant to chemotherapy or other treatments, such as castration-resistant prostate cancer, small cell lung cancer, and others. EZH2 plays a role in the resistance to poly adenosine diphosphate ribose polymerase, or PARP, inhibitors. When PARP inhibitors are given, DNA is damaged, which leads to increased EZH2 activity and limits the responsiveness to the PARP inhibitor. By blocking EZH2 with tazemetostat, we believe we can also re-sensitize tumors to PARP inhibition treatment.

Castration-Resistant Prostate Cancer: Prostate cancer is the most frequently diagnosed and second most frequent cause of cancer deaths among men in the United States. We believe that treatment with an EZH2 inhibitor after resistance to the standards-of-care may result in recovery of sensitivity to these agents because, based on published literature, EZH2 protein expression has been correlated with progression of metastatic castration-resistant prostate cancer, or mCRPC, and moderate to high EZH2 expression has been associated with worse survival. We are conducting a global, multi-center, randomized Phase 1b/2 trial (EZH-1101, CELLO-1) evaluating tazemetostat in combination with enzalutamide or abiraterone plus prednisone, the standard of care treatments for mCRPC. As of February 2021, we had completed enrollment in the Phase 1b safety run-in portion of CELLO-1 with a total of 21 men with mCRPC. Based on early safety and activity findings observed in the Phase 1b safety run-in portion of CELLO-1, in the first quarter of 2021 we initiated enrollment in the Phase 2 efficacy portion of CELLO-1 evaluating tazemetostat in combination with enzalutamide compared to enzalutamide alone, and we expect to include 80 men with mCRPC in this Phase 2 portion of the trial. The primary endpoint for CELLO-1 is radiographic progression free survival. The Phase 2 efficacy portion of the trial is approximately 75% enrolled toward the target of 80 patients, and we expect to complete enrollment in the Phase 2 portion of the trial in 2022. We plan to provide updated data from the safety run-in portion of the trial as well as interim data from the Phase 2 portion of the trial in the second half of 2022.

In September 2021, at the European Society for Medical Oncology (ESMO) Congress, we announced preliminary data from the Phase 1b safety run-in portion of the trial using a data cutoff date of July 22, 2021. The safety run-in portion of CELLO-1 is being conducted using a standard dose escalation design. Among the 21 patients enrolled in the safety run-in portion, as of the data cutoff date no dose limiting toxicities, or DLTs, were observed at any dose of tazemetostat up to a maximum dose of 1600 mg twice daily for patients receiving tazemetostat plus enzalutamide and 800 mg twice daily for patients receiving tazemetostat plus abiraterone. As of the July 22, 2021 cutoff date, preliminary data from the trial also showed:

•Median PFS had not been reached at cutoff for the tazemetostat plus enzalutamide arm; six-month PFS was 61.7%.

•11 of 21 patients experienced prostate-specific antigen, or PSA, decline from baseline; seven out of 21 patients had a PSA response of ≥50%; one additional patient had a PSA response of ≥30%.

•Six of the PSA50 responses were in the tazemetostat + enzalutamide cohort (n=13) and one was in the tazemetostat + abiraterone/prednisone cohort (n=8).

•One patient with a PSA50 response achieved a radiographic partial response.

•All PSA50 and PSA30 responses were in ARV7 negative and neuroendocrine subtype negative patients identified using the EPIC platform. Only one ARV7 positive patient was enrolled in the safety run-in portion of the trial.

PARP-Resistant Solid Tumors: We are continuing with an ongoing investigator-sponsored trial that is intended to investigate the therapeutic potential of tazemetostat as a combination therapy with a PARP inhibitor for the

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treatment of PARP-resistant tumors. In PARP-resistant cancers, PARP inhibitors have shown modest monotherapy activity, and we continue to believe tazemetostat may have the potential to enhance the clinical response to PARP inhibitors.

Immuno-oncology-sensitive Tumors

We are assessing the use of tazemetostat for immuno-oncology-sensitive tumors, such as small cell lung cancer, prostate cancer and others. We believe tazemetostat has the potential to enhance the antitumor immune response by interfering with multiple EZH2 functions in the cell. EZH2 inhibition results in tumor-intrinsic and tumor-extrinsic effects that reshape the tumor microenvironment to favor antitumor immunity, including increasing antigen presentation, increasing effector T cell trafficking, modulating the adaptive anti-tumor response, impairing regulatory T cells, inducing the expression of tumor antigens and endogenous retroviruses, and increasing NK cell maturation and killing. By inhibiting EZH2, we believe tazemetostat may be able to influence biologic activity in the tumor microenvironment, which could enable tumors to be more sensitive or re-sensitized to immune-oncology therapies.

EZM0414, Our SETD2 Inhibitor Program and SET-101, Our Phase 1/1b Trial of EZM0414

We are developing a novel first-in-class oral inhibitor of SETD2 (EZM0414). SETD2 is an HMT that plays multiple important roles in oncogenesis. We submitted an IND for EZM0414 to the FDA in July 2021 based on the potential of SETD2 inhibition demonstrated in multiple preclinical settings, including multiple myeloma, and in particular high risk t(4;14) multiple myeloma and in other B-cell malignancies such as DLBCL, as well as in combination with existing and emerging therapies including tazemetostat.

We received “study may proceed” from the FDA with respect to our IND for EZM0414 in July 2021. In October 2021, EZM0414 was granted Fast Track designation by the FDA in adult patients with relapsed or refractory DLBCL and in January 2022 we received orphan drug designation from the FDA for EZM0414 for the treatment of multiple myeloma. This trial (SET-101), which we initiated in the fourth quarter of 2021, is a Phase 1/1b trial intended to evaluate the safety and optimize the dose and schedule of EZM0414 in relapsed or refractory multiple myeloma and DLBCL patients. The Phase 1 portion of our SET-101 trial is a 3 + 3 dose escalation design and includes six planned dose levels ranging from 100 mg to 900 mg once daily. Once we have optimized the dose, we then expect to expand the trial to two patient cohorts in multiple myeloma: t(4;14) multiple myeloma and non t(4;14) multiple myeloma. Based on dose optimization data from the trial, we may add a third patient cohort in DLBCL. We are screening patients with one site open for the Phase 1 dose escalation portion of the SET-101 trial, which we expect will enroll between 30-36 patients. We plan to provide updates as the trial reaches key enrollment milestones, along with preliminary data from the trial in 2022.

Our Research Focus

Beyond tazemetostat and EZM0414, we are utilizing our proprietary drug discovery platform to progress preclinical efforts and discover and identify additional product candidates to expand our pipeline of inhibitors against several classes of CMPs, including HMTs, HATs, and helicases. These programs are directed against both hematological malignancies and solid tumors and include biomarker approaches to patient stratification.

Our Epigenetic Approach

Epigenetics refers to a broad regulatory system that controls gene expression without altering the sequence of the genes themselves. Genes are composed of DNA, and in nature, this DNA is wrapped around a core of proteins known as histones. Together, the DNA and histone proteins form a complex known as chromatin that is the basic structural component of chromosomes.

Gene regulation is determined by chromatin structure. The dynamics of chromatin structure are regulated through multiple mechanisms by CMPs. Some CMPs place chemical groups onto specific sites on histones or DNA, some remove these marks in site-specific ways, others recognize the uniquely marked sites on histones and bind to these marked sites, and still other CMPs drive topological changes to histone-DNA interactions within chromatin. Where, when and how such chromatin structure changes occur determines which genes in a cell are turned “on” or “off” at

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any particular time. When the function of these CMPs is altered, the program of gene expression is changed in ways that can lead to disease.

To further support our leadership position in epigenetics, we are discovering and developing inhibitors of CMPs as novel therapeutics for patients with cancer. Our focus is on the discovery, development and commercialization of small molecule inhibitors of CMPs for applications in diseases that are uniquely dependent on the enzyme activity of a specific CMP. Among the CMP target classes, we have had a particular emphasis on the HMTs, which have been shown to play pathogenic roles in a number of human diseases. Today, we have programs in HMTs as well as additional target classes, including HATs, and helicases. We believe that targeting pathogenic CMPs affords us multiple opportunities to create, develop and commercialize novel therapeutics.

Our Collaborations

We have entered into several key strategic collaborations, including therapeutic collaborations and other collaborations. Since our inception, the therapeutic collaborations have provided us with $268.8 million in non-equity funding through December 31, 2021. Key terms of our ongoing collaborations are summarized below.

Eisai

Overview. In March 2015, we entered into an amended and restated collaboration and license agreement with Eisai, under which we reacquired worldwide rights, excluding Japan, to our EZH2 program, including tazemetostat. Under the amended and restated collaboration and license agreement, we will be responsible for global development, manufacturing and commercialization outside of Japan of tazemetostat and any other EZH2 product candidates, with Eisai retaining development and commercialization rights in Japan, as well as a right to elect to manufacture tazemetostat and any other EZH2 product candidates in Japan, including the right of first negotiation for the rest of Asia. Eisai waived its right of first negotiation for the rest of Asia in 2018. Under the original collaboration and license agreement, we had granted Eisai an exclusive worldwide license to our small molecule HMT inhibitors directed to EZH2, including tazemetostat, while retaining an opt-in right to co-develop, co-commercialize and share profits with Eisai as to licensed products in the United States.

Upon the execution of the amended and restated collaboration agreement in March 2015, we agreed to pay Eisai a $40.0 million upfront payment. We also agreed to pay Eisai up to $20.0 million in clinical development milestone payments, including a $10.0 million milestone payment upon the earlier of initiation of a first phase 3 clinical trial of any EZH2 product or the first submission of an NDA or Market Authorization Application, or MAA, and a $10.0 million milestone upon the earlier of initiation of a first phase 3 clinical trial of any EZH2 product or the first submission of an NDA or MAA for a second indication, and up to $50.0 million in regulatory milestone payments, including a $25.0 million milestone payment upon regulatory approval of the first NDA or MAA, and a $25.0 million milestone payment upon regulatory approval of the NDA or MAA for the second indication. We are obligated to pay royalties at a percentage in the mid-teens on worldwide net sales of any EZH2 product, excluding net sales in Japan. In 2019, Eisai sold its rights to these royalties to RPI Finance Trust, which has agreed to certain reductions in these royalties in the event certain net sales thresholds are achieved. We are eligible to receive from Eisai royalties at a percentage in the mid-teens on net sales of any EZH2 product in Japan. In November 2019, we sold our rights to these royalties to RPI Finance Trust. In 2019, we triggered the payment of the two $10.0 million milestone payments upon the submission of the NDAs for accelerated approval of tazemetostat for epithelioid sarcoma and follicular lymphoma. In January 2020, we triggered the payment of the $25.0 million milestone payment upon regulatory approval in the United States of tazemetostat for epithelioid sarcoma and in June 2020 we triggered the payment of an additional $25.0 million milestone payment upon regulatory approval in the United States of tazemetostat for follicular lymphoma.

Under the original agreement, Eisai was solely responsible for funding all research, development and commercialization costs for licensed compounds. Under the amended and restated agreement, we are solely responsible for funding global development, manufacturing and commercialization costs for EZH2 compounds outside of Japan, and Eisai is solely responsible for funding Japan-specific development and commercialization costs for EZH2 compounds. In connection with the amended and restated agreement, we and Eisai agreed to the transition to us of ongoing development and manufacturing activities that were being conducted by or on behalf of Eisai. In January 2017, as part of Eisai’s obligations under the amended and restated collaboration agreement, Eisai

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enrolled and dosed the first patient in a Phase 1 study of tazemetostat in patients with relapsed or refractory B-cell NHL in Japan.

In the event that we are awarded a priority review voucher from the FDA with respect to an EZH2 product, Eisai is entitled to specified compensation if we use the voucher on a non-EZH2 program or sell the voucher to a third party.

Governance. Under the amended and restated collaboration and license agreement, development will be guided by a joint steering committee, with our company retaining final decision-making authority with respect to global development other than with respect to Japan-specific development and commercialization.

Exclusivity Restrictions. Subject to exceptions specified in the agreement, for an exclusivity period extending until eight years after the first commercial sale of a product covered by the agreement, neither we nor Eisai may research, develop or commercialize HMT inhibitors directed to EZH2, other than pursuant to the agreement.

Term and Termination. Our agreement with Eisai will remain in effect until the expiration of all payment obligations under the agreement with respect to all licensed products. The royalty term for each licensed product in each country commences on the first commercial sale of the applicable licensed product in the applicable country and ends on the latest of expiration of specified patent coverage, expiration of specified regulatory exclusivity or ten years following the first commercial sale. We or Eisai may terminate the agreement for convenience as to our respective territories, upon 90 days’ prior written notice. The agreement will also terminate as to our territory if we cease all development and commercialization activities for the United States and specified major countries in Europe and as to Eisai’s territory if Eisai ceases all development and commercialization activities for Japan. The agreement may also be terminated by either party in the event of an uncured material breach by the other party or by us in the event Eisai, or an affiliate or sublicensee, participates or actively assists in an action or proceeding challenging or denying the validity of one of our patents. If we terminate the agreement for our convenience, the agreement terminates as a result of our cessation of development and commercialization activities or Eisai terminates the agreement for our uncured material breach, Eisai may elect to have worldwide development and commercialization rights revert to Eisai, and if Eisai so elects, Eisai will be required to pay us specified royalties on net sales of the licensed products and reimburse certain development expenses incurred by us. If Eisai terminates the agreement for its convenience, the agreement terminates as a result of Eisai’s cessation of development and commercialization activities or we terminate the agreement for Eisai’s uncured material breach or Eisai’s, or its affiliate’s or sublicensee’s, participation in, or assistance with, an action or proceeding challenging or denying the validity of one of our patents, Japanese development and commercialization rights to the licensed products revert to us, and we will be required to pay Eisai specified royalties on net sales of licensed products in Japan.

HutchMed

Overview. In August 2021, we entered into a strategic collaboration pursuant to a license agreement, or the HutchMed License Agreement, with HutchMed for the development, manufacture and commercialization of tazemetostat, either as a monotherapy or as a part of combinations with other therapies, including HutchMed proprietary compounds, agreed by the parties under the HutchMed License Agreement for the treatment of ES, FL, DLBCL in humans, and any additional indications agreed by the parties in accordance with the terms of the HutchMed License Agreement in mainland China, Taiwan, Hong Kong and Macau, each a Jurisdiction and collectively, the HutchMed Territory.

We have granted HutchMed licenses under patent rights and know-how that we control to enable HutchMed to develop and commercialize licensed products for the treatment of ES, FL, DLBCL and any additional indications agreed by the parties in the HutchMed Territory. The licenses granted to HutchMed are co-exclusive with us with respect to the development of licensed products for the treatment of ES, FL, DLBCL and any additional indications agreed by the parties in the HutchMed Territory and exclusive with respect to the commercialization of licensed products for the treatment of ES, FL, DLBCL and any additional indications agreed by the parties in the HutchMed Territory. We also granted HutchMed a license under patent rights and know-how controlled that we control to enable HutchMed to manufacture tazemetostat drug substance and drug product for the purpose of developing and commercializing licensed products for the treatment of ES, FL, DLBCL and any additional indications agreed by the parties in the HutchMed Territory. We retain development and commercialization rights with respect to licensed products in the rest of the world outside of the HutchMed Territory except for Japan. During the term of the

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HutchMed License Agreement, each party and its affiliates is prohibited from developing or commercializing any other compound or product that inhibits, modulates or degrades EZH1, EZH2, or any other member of the polycomb repressive complex 2, including the EED protein for the treatment of ES, FL, DLBCL and any additional indications agreed by the parties in the HutchMed Territory, provided that, subject to limitations specified in the HutchMed License Agreement, HutchMed may develop its existing preclinical compound that inhibits EZH1 and EZH2 without the use of know-how or patent rights that we licensed to HutchMed.

We have agreed to conduct a technology transfer of manufacturing technology to HutchMed to enable HutchMed to manufacture clinical and commercial quantities of tazemetostat drug substance and drug product to carry out its obligations and exercise its rights under the HutchMed License Agreement. Subject to the execution of a clinical supply agreement or commercial supply agreement, as applicable, and until the completion of the technology transfer to HutchMed, we have agreed to manufacture and supply HutchMed with tazemetostat drug substance and drug product in sufficient quantities for HutchMed’s development or commercialization activities for licensed products for the treatment of ES, FL, DLBCL and any additional indications agreed by the parties in the HutchMed Territory.

HutchMed has agreed to use commercially reasonable efforts to carry out development activities in the HutchMed Territory as agreed by the parties and to seek to obtain and maintain regulatory approval of the licensed products in the HutchMed Territory. HutchMed agreed to use commercially reasonable efforts to commercialize licensed products for the treatment of ES, FL, DLBCL and any additional indications agreed by the parties in the HutchMed Territory. HutchMed is responsible for all costs it incurs in developing, obtaining regulatory approval of, and commercializing licensed products in the HutchMed Territory, including costs incurred by HutchMed in conducting clinical trials that only include clinical sites in the HutchMed Territory. For global studies that we conduct and in which HutchMed elects to participate by conducting any such study in the HutchMed Territory, HutchMed will be responsible for enrolling and treating in the HutchMed Territory 20% of the total number of study patients of such global study and will be responsible for costs for those patients enrolled and treated in such trials. HutchMed will also be responsible for 20% of the costs of such global studies that are not specific to any territory and we will be responsible for all other costs of such global studies. HutchMed has agreed to participate in our EZH-301 and EZH-302 global studies, however under certain circumstances where the EZH-302 global study is not considered a confirmatory trial for regulatory approval in China, we shall be responsible for the costs of the trial in the HutchMed Territory.

Pursuant to the HutchMed License Agreement, we received a nonrefundable upfront payment of $25.0 million in September 2021. We are also entitled to milestone payments of up to $110.0 million in the aggregate for achievement of specified development and regulatory milestones with respect to licensed products in the HutchMed Territory, and up to $175.0 million in the aggregate for achievement of specified sales milestones in the HutchMed Territory with respect to the licensed products. We will also be entitled to receive tiered royalties, ranging from a mid-teens percentage to a low twenties percentage based on HutchMed’s cumulative annual net sales, if any, of licensed products in the HutchMed Territory. Royalties are payable for each licensed product commencing on the first commercial sale of the applicable licensed product and ending, on a Jurisdiction-by-Jurisdiction basis, on the latest of expiration of specified patent coverage, expiration of specified regulatory exclusivity or a specified period following the first commercial sale in such Jurisdiction and may be reduced in various circumstances.

Under the HutchMed License Agreement, we issued a warrant to HutchMed, or the “HutchMed Warrant, exercisable at any time prior to August 7, 2025 for up to 5,653,000 shares of our common stock at an exercise price of $11.50 per share. On September 21, 2021 we filed with the SEC a registration statement on Form S-3 registering for resale the shares of our common stock issuable upon exercise of the HutchMed Warrant in accordance with the HutchMed Warrant. Such registration statement on Form S-3 was declared effective by the SEC on September 29, 2021.

Term and Termination. Unless earlier terminated, the HutchMed License Agreement will expire upon the expiration of the last royalty term for the last licensed product for the treatment of ES, FL, DLBCL and any additional indications agreed by the parties in the HutchMed Territory. HutchMed may terminate the HutchMed License Agreement in its entirety for any or no reason upon 12 months’ prior written notice to us. Either party may, subject to specified cure periods, terminate the HutchMed License Agreement in the event of the other party’s uncured material breach, and under specified circumstances relating to the other party’s insolvency or if the other party or its

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affiliates challenges the validity, patentability, or enforceability of patent rights that are owned by or licensed to such party or its affiliates and that are subject to the licenses granted in the HutchMed License Agreement.

LYSA

In May 2016, we entered into a collaboration agreement with the Lymphoma Academic Research Organization, or LYSARC, to conduct a combination trial of tazemetostat. LYSARC is the operational arm of LYSA, a premier cooperative group in France dedicated to clinical and translational research for lymphoma. Based on clinical activity observed with tazemetostat in a combination Phase 1b/2 trial with R-CHOP as a front-line treatment for patients with high risk diffuse large B-cell lymphoma, or DLBCL, we agreed in 2020 to expand the trial to also include an expansion cohort for the front-line treatment of high-risk patients with FL. LYSA is conducting the Phase 2 clinical expansion trial and the Phase 1b part of the trial has completed. LYSA is managing the study operations for the trial, and we are recognizing our share of the related expenses as those costs are incurred over the duration of the trial. Primary endpoints in the trial include complete response rate, safety and tolerability of the combination. Secondary endpoints include ORR and PFS. Patient enrollment in the Phase 2 portion of this trial is now nearly complete with 111 patients out of a target of approximately 122 patients in DLBCL and 61 patients out of a target of approximately 62 patients in FL enrolled as of February 23, 2022. We expect that interim results from the Phase 2 portion of this trial will be presented at a medical conference in the second half of 2022.

GSK

On December 16, 2021, we received written notice from Glaxo Group Limited, or GSK, that GSK had elected to terminate the collaboration and license agreement entered into in January 2011, as amended. GSK terminated the agreement without cause, and in accordance with the terms of the agreement and the notice of termination, the termination will be effective on March 16, 2022, or the GSK Agreement Termination Effective Date. The agreement provided that the parties would discover, develop and commercialize novel small molecule histone methyltransferase, or HMT, inhibitors directed to available targets from our product platform. Under the terms of the agreement, we granted GSK exclusive, worldwide license rights to HMT inhibitors directed to three targets. As part of the collaboration, we agreed to provide research and development services related to the licensed targets pursuant to agreed-upon research plans during a research term that ended January 8, 2015. We completed substantially all research obligations under the agreement by the end of the first quarter of 2015 and completed the transfer of the remaining data and material for these programs to GSK in the second quarter of 2015. GSK was then responsible for all future development and commercialization. Subsequent to a GSK strategic portfolio prioritization, we received notice in October 2017 that GSK terminated the agreement with respect to the third target, effective December 31, 2017, which returned all rights to that target to us. The two other targets, PRMT5 and PRMT1, continued to be subject to the agreement and were not impacted by the termination with respect to the third target. As a result of the termination of the agreement, as of the GSK Agreement Termination Effective Date, the license rights granted by us to GSK will terminate, GSK will cease to accrue any financial obligations to us and we will be entitled to pursue the PRMT5 and PRMT1 targets in all fields worldwide without further obligation to GSK.

Companion Diagnostics

Roche Sequencing Solutions

In December 2012, Eisai and we entered into a companion diagnostics agreement with Roche Molecular under which Eisai and we engaged Roche Molecular to develop a companion diagnostic to identify patients who possess certain activating mutations of EZH2. In October 2013, this agreement was amended to include additional mutations in EZH2. The development costs due under the amended agreement with Roche Molecular were the responsibility of Eisai until the execution of the amended and restated collaboration and license agreement with Eisai in March 2015, at which time we assumed responsibility for the remaining development costs due under the agreement. In December 2015, we and Eisai entered into a second amendment to the companion diagnostics agreement with Roche Molecular. The agreement was further amended in March 2018. Under the amended agreement, we were responsible for remaining development costs of $10.4 million due under the agreement as of March 2018 and Eisai agreed to reimburse us $0.9 million of this amount related to a regulatory milestone for Japan, which Eisai paid to us in the fourth quarter of 2020. In July 2019, we entered into a fourth amendment to the companion diagnostics agreement. Under the amended agreement, we and Roche Molecular agreed to divide a $1.0 million regulatory milestone for the United States into two separate milestone payments, of which $0.5 million was paid by us as part of the signed

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amendment, and the remaining $0.5 million was paid by us in December 2019 upon the satisfaction of certain conditions set forth in the fourth amendment to the companion diagnostics agreement. As part of this fourth amendment, Roche Molecular also assigned all of its rights and obligations under the companion diagnostics agreement to Roche Sequencing Solutions, or RSS, effective as of January 1, 2020. As of December 31, 2021, we are responsible for the remaining development costs of $1.0 million due under the agreement. In addition, we paid $1.0 million for the achievement of a development milestone in the fourth quarter of 2020.

Under the agreement with RSS, RSS is obligated to use commercially reasonable efforts to develop and to make commercially available the companion diagnostic kit. RSS has exclusive rights to commercialize the companion diagnostic kit developed pursuant to this agreement. On June 18, 2020 the FDA approved the companion diagnostic kit that is intended to identify FL patients with an EZH2 mutation for treatment with tazemetostat.

The agreement with RSS will expire when we and Eisai are no longer developing or commercializing tazemetostat. We and Eisai may terminate the agreement by giving RSS 90 days’ written notice if we and Eisai discontinue development and commercialization of tazemetostat or determine, in conjunction with RSS, that the companion diagnostic is not needed for use with tazemetostat. Any party may also terminate the agreement in the event of a material breach by any other party, in the event of material changes in circumstances that are contrary to key assumptions specified in the agreement or in the event of specified bankruptcy or similar circumstances. Under specified termination circumstances, RSS may become entitled to specified termination fees.

Intellectual Property

We strive to protect the proprietary compounds and technologies that we believe are important to our business, including seeking and maintaining patent protection intended to cover the composition of matter of our product candidates, their methods of use, related technologies, diagnostics and other inventions. Our patent portfolio is currently composed of over 300 issued patents and allowed patent applications and over 550 pending patent applications in the major pharmaceutical markets, that we own as well as license from other parties. In addition to patent protection, we also rely on trade secrets and careful monitoring of our proprietary information to protect aspects of our business that are not amenable to, or that we do not consider appropriate for, patent protection.

Our success will depend significantly on our ability to obtain and maintain patent and other proprietary protection for commercially important technology, inventions and know-how related to our business, defend and enforce our patents, maintain our licenses to use intellectual property owned by third parties, preserve the confidentiality of our trade secrets and operate without infringing the valid and enforceable patents and other proprietary rights of third parties. We also rely on know-how, continuing technological innovation and in-licensing opportunities to develop, strengthen, and maintain our proprietary position in the field of HMTs, as well as to develop a proprietary position for new target classes, such as HATs and helicases.

We plan to continue to expand our intellectual property estate by filing patent applications directed to dosage forms, methods of treatment and additional CMP and HMT inhibitor compounds and their derivatives, and to other new target classes. Specifically, we seek patent protection in the United States and internationally for novel compositions of matter covering the compounds, the chemistries and processes for manufacturing these compounds and the use of these compounds in a variety of therapies.

The patent portfolios for our most advanced programs are summarized below.

EZH2. Our EZH2 patent portfolio includes U.S. Patent No. 8,410,088 covering the composition of matter of tazemetostat. This patent issued on April 2, 2013 and is expected to expire in 2032, not including extensions. Our EZH2 portfolio also includes 54 additional U.S. patents and more than 250 foreign patents, expected to expire between 2031 and 2037, not including extensions. The claims of these patents cover the composition of matter of EZH2 inhibitor compounds and various methods of their making and use. Patent applications in the same families as these patents are pending in a variety of worldwide jurisdictions, including the United States. The EZH2 program portfolio encompasses more than 40 patent families with pending patent applications relating to compositions of matter and methods of making and use of EZH2 inhibitors. The patent families in this portfolio are in various stages of prosecution and include patent applications filed in a variety of worldwide jurisdictions, including the United States; Patent Cooperation Treaty, or PCT, applications that are eligible for filing in most worldwide jurisdictions,

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including the United States, and at least one U.S. provisional application that may be used as the basis for non-provisional U.S. applications, PCT applications and other national filings worldwide. Our patent applications in the EZH2 portfolio, if issued, would be expected to expire between 2031 and 2041, not including extensions.

SETD2. Our SETD2 patent portfolio includes six patent families directed to various product candidates and methods of use, with applications filed in the United States and internationally. Patents, if issued from currently pending applications in the SETD2 portfolio, are expected to expire between 2038 and 2042, not including extensions.

EHMT2. Our EHMT2 patent portfolio includes more than eight patent families directed to various product candidates and methods of use, with applications filed in the United States and internationally. Patents, if issued from currently pending applications in the EHMT2 portfolio, are expected to expire between 2037 and 2038, not including extensions.

Other Targets. We also have patent portfolios directed to targets other than EZH2, SETD2 and EHMT2, including the HMT targets DOT1L, PRMT1, PRMT3, CARM1 (also known as PRMT4), PRMT5, PRMT6, PRMT8, SMYD2 and SMYD3. These patent portfolios have more than 35 patent families directed to various product candidates with applications filed in the United States, PCT applications that are eligible for filing in most worldwide jurisdictions, including the United States, and U.S. provisional applications that may be used to establish non-provisional U.S. applications, PCT applications and other national filings worldwide. Patents, if issued in these portfolios are expected to expire between 2033 and 2041. We have more than 20 granted U.S. patents that cover PRMT5 inhibitors and their methods of use. These patents are expected to expire in 2033, not including extensions.

The term of individual patents depends upon the legal term of the patents in the countries in which they are obtained. In most countries in which we file, the patent term is 20 years from the earliest date of filing a non-provisional patent application.

In the United States, the patent term of a patent that covers an FDA-approved drug may also be eligible for patent term extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory review process. The Hatch-Waxman Act permits a patent term extension of up to five years beyond the expiration of the patent. The length of the patent term extension is related to the length of time the drug is under regulatory review. Patent extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval and only one patent applicable to an approved drug may be extended. Similar provisions are available in Europe and other non-United States jurisdictions to extend the term of a patent that covers an approved drug. We have applied for patent term extension on a patent that covers the TAZVERIK drug substance (tazemetostat) based on the regulatory review of TAZVERIK for the treatment of adult and pediatric patients aged 16 years and older with metastatic or locally advanced ES not eligible for complete resection. In the future, if and when any additional pharmaceutical products receive FDA approval, we expect to apply for patent term extensions on patents covering those products. We intend to seek patent term extensions to any of our issued patents in any jurisdiction where these are available, however there is no guarantee that the applicable authorities, including the FDA in the United States, will agree with our assessment of whether such extensions should be granted, and even if granted, the length of such extensions.

We also rely on trade secret protection for our confidential and proprietary information. Although we take steps to protect our proprietary information and trade secrets, including through contractual means with our employees and consultants, third parties may independently develop substantially equivalent proprietary information and techniques or otherwise gain access to our trade secrets or disclose our technology. Thus, we may not be able to meaningfully protect our trade secrets. It is our policy to require our employees, consultants, outside scientific collaborators, sponsored researchers and other advisors to execute confidentiality agreements upon the commencement of employment or consulting relationships with us. These agreements provide that all confidential information concerning our business or financial affairs developed or made known to the individual during the course of the individual’s relationship with us is to be kept confidential and not disclosed to third parties except in specific circumstances. In the case of employees, the agreements also provide that all inventions conceived by the individual, and which are related to our current or planned business or research and development or made during normal working hours, on our premises or using our equipment or proprietary information, are our exclusive property.

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Manufacturing

We do not have any manufacturing facilities and currently rely, and expect to continue to rely, on third parties for the manufacture of our development-stage product candidates including EZM0414 as well as our commercial product, tazemetostat. We have entered into clinical and commercial supply agreements with contract manufacturers for the clinical development and commercialization of tazemetostat.

Tazemetostat and EZM0414 are small molecules and are manufactured in third-party facilities that are equipped, staffed, and experienced in the manufacture of such pharmaceutical products. All such facilities have successful track-records manufacturing products for the United States, European Union, and rest of world markets, meeting regulatory and compliance requirements as appropriate.

We expect that any product candidates that we may develop will be small molecules that may be produced cost-effectively at contract manufacturing facilities.

We rely on third parties for the manufacture of any diagnostics we may need or if required and may continue to enter into similar agreements for the manufacture of other diagnostics. We are currently collaborating with RSS for a diagnostic for its use with tazemetostat. As described above, under the agreement with RSS, RSS is obligated to use commercially reasonable efforts to develop and to make commercially available the companion diagnostic kit. In June 2020 the FDA approved the companion diagnostic kit that is intended to identify follicular lymphoma patients with an EZH2 mutation for treatment with tazemetostat.

Commercialization

TAZVERIK is available to eligible patients in the United States via a specialty distribution network. Through this specialty distribution network, we sell TAZVERIK principally to a limited number of specialty pharmacies, which dispense the product directly to patients, and specialty distributors, which in turn sell the product to hospital pharmacies and community practice pharmacies for the treatment of patients. To commercialize TAZVERIK for the ES and FL indications in the United States, we have built a focused field presence and marketing capabilities. This includes an efficiently sized field-based organization focused on Academic Centers of Excellence, Integrated Delivery Networks (IDNs) and targeted community clinics. This includes an efficiently sized field-based organization of approximately 45 individuals.

We are pursuing three strategic commercialization imperatives that we believe are integral to success for TAZVERIK in the United States:

•ensure eligible ES and FL patients have access to TAZVERIK by educating healthcare providers, patients and payers on the TAZVERIK data in approved indications,

•ensure that TAZVERIK is readily accessible by physicians as an essential treatment option for each labeled indication through incorporation into systems of care, consistent with the label and guidelines, and

•ensure our company sponsored programs for patients and healthcare providers (EpizymeNOW and EZH2NowSM) support a positive experience when TAZVERIK is prescribed. EpizymeNOW facilitates patient access to new TAZVERIK prescriptions, and the EZH2Now program provides access to EZH2 testing free of charge to patients with FL for providers who wish to know the mutation status of their patients.
 

Subject to receiving marketing approvals for additional indications or products, we expect to use our existing sales organization in the United States or to seek to expand our sales organization in the United States to sell our products. We believe that such an organization will be able to address the hematologists and oncologists who are the key specialists in treating the patient populations for which tazemetostat is currently approved and for which it is being developed and for which any future product candidates may be developed. Outside the United States, we may choose to enter into distribution and other marketing arrangements with third parties for any of our product candidates that obtain marketing approval, or may choose to commercialize our products in certain markets,

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depending upon many factors, including the target market size, availability of reimbursement, and our financial resources at the time.

We own the global development and commercialization rights to tazemetostat outside of Japan and greater China. Eisai holds the rights to develop and commercialize tazemetostat in Japan. On August 7, 2021, pursuant to a license agreement with HutchMed, we granted a license to HutchMed for the co-exclusive (with us) development and exclusive commercialization of tazemetostat, either as monotherapy or as a part of combinations with other therapies, including HutchMed proprietary compounds, agreed by us and HutchMed for the treatment of ES, FL and DLBCL in humans, and any additional indications agreed to by us and HutchMed in the HutchMed Territory. For other geographies outside the United States, we are evaluating the most efficient path to reaching patients, including through leveraging existing and identifying new strategic collaborations that can contribute to our ability to rapidly develop and commercialize tazemetostat outside of the United States.

We expect that our collaborators for any companion or complementary diagnostics we may develop in the future for use with our therapeutic products will hold the commercial rights to these diagnostic products, as is the case for our collaboration with RSS. We expect to coordinate closely with any diagnostic collaborators in connection with the marketing and sale of any related therapeutic products.

Competition

The biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products. While we believe that our technology, knowledge, experience and scientific resources provide us with competitive advantages, we face potential competition from many different sources, including major pharmaceutical, specialty pharmaceutical and biotechnology companies, academic institutions and governmental agencies and public and private research institutions. Any product candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

There are a large number of companies developing or marketing treatments for cancer, including many major pharmaceutical and biotechnology companies. Companies that are developing new epigenetic treatments for cancer that target histone methyltransferases, or HMTs, and protein arginine methyltransferases, or PRMTs, include GSK, Johnson & Johnson, Pfizer, Inc., Daiichi Sankyo Company Limited, and MorphoSys AG. Further, companies which are known to have EZH2 inhibitor programs or related programs include: Constellation Pharmaceuticals, developing an EZH2 inhibitor CPI-0209, Phase 1/2, solid tumors and lymphoma, including DLBCL, Novartis AG, developing an EED inhibitor which indirectly blocks EZH2 (MAK683, Phase 1/2, advanced malignancies), Daiichi Sankyo, developing a EZH1/EZH2 dual inhibitor (valemetostat, DS-3201, Phase 1, relapsed or refractory non-Hodgkin lymphomas, AML, ALL as well as Phase 2 for small cell lung cancer), and Pfizer, developing EZH2 inhibitor PF-06821497, Phase 1, relapsed or refractory SCLC, castration-resistant prostate cancer, FL and diffuse large B-cell lymphoma. In addition, many companies are developing cancer therapeutics that work by targeting epigenetic mechanisms other than HMTs, and some including Celgene (now part of Bristol-Myers Squibb), Merck & Co., Inc., Secura Bio, Spectrum Pharmaceuticals Otsuka Pharmaceuticals, Foghorn Therapeutics, Forma Therapeutics and CellCentric are now marketing cancer treatments that work by targeting epigenetic mechanisms other than HMTs.

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, biotechnology and diagnostic 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 necessary for, our programs.

The key competitive factors affecting the success of all of our therapeutic product candidates, if approved, are likely to be their efficacy, safety, convenience, price, the effectiveness of companion diagnostics in guiding the use of

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related therapeutics, the level of generic competition and the availability of reimbursement from government and other third-party payors.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products 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 ours, which could result in our competitors establishing a strong market position before we are able to enter the market. In addition, our ability to compete may be affected in many cases by insurers or other third-party payors seeking to encourage the use of generic products. Generic products that broadly address these indications are currently on the market for the indications that we are pursuing, and additional products are expected to become available on a generic basis over the coming years. If our product candidates achieve marketing approval, we expect that they will be priced at a significant premium over competitive generic products.

The most common methods of treating patients with cancer are surgery, radiation and drug therapy. There are a number of products in late-stage clinical development to treat cancer. These products in development may provide efficacy, safety, convenience and other benefits that are not provided by currently marketed therapies. As a result, they may provide significant competition for any of our product candidates for which we obtain marketing approval.

Tazemetostat. The most common treatments for FL are chemotherapies, usually combined with the monoclonal antibody Rituxan, or Gazyva, which is an antibody that acts against the same target as Rituxan, CD20. While Rituxan and a number of other widely used anti-cancer agents are labeled broadly for follicular lymphoma, no therapies are approved specifically for the treatment of tumors associated with EZH2 activating mutations. There are a number of companies currently evaluating investigational agents in the relapsed and refractory follicular lymphoma patient setting.

In the relapsed and refractory follicular lymphoma patient setting, both current and near-term competition exists. Current competition includes CD20 combinations, several PI3K inhibitors, and CAR-T therapies. However, recently, two companies have announced that there have been voluntary withdrawals of accelerated approvals for FL indications for two PI3K inhibitors, Zydelig (idelalisib), and Copiktra (duvelisib) in the U.S. market. Additionally, parsaclisib’s NDA has been voluntarily withdrawn for the treatment of patients with relapsed/refractory FL. Near-term competition includes companies currently evaluating investigational agents with varying mechanisms of action, with a CAR-T therapy (KYMRIAH) and a PI3K inhibitor/CD20 combination (Aliqopa (copanlisib) + rituximab) currently undergoing review with the FDA. In the first quarter of 2021, Kite Pharma, a subsidiary of Gilead Sciences, received FDA approval for its CAR-T therapy, YESCARTA, for the treatment of relapsed or refractory FL patients. Novartis is also developing its CAR-T therapy, KYMRIAH, for relapsed or refractory FL patients. In the third quarter of 2021 the FDA accepted Novartis’ Supplemental Biologics License Application for KYMRIAH in adult patients with relapsed or refractory FL after two prior lines of treatment. The EMA also accepted Novartis’ Type II Variation for KYMRIAH in adult patients with relapsed or refractory FL after two prior lines of treatment in the third quarter of 2021. KYMRIAH is also undergoing priority review by the FDA for relapsed or refractory FL patients. The bispecific antibody furthest along in development in relapsed or refractory FL is Roche’s CD3/CD20 bispecific mosunetuzumab.

Other than TAZVERIK, there are no therapies which have been approved specifically for the treatment of epithelioid sarcoma. Epithelioid sarcoma, an INI1-negative tumor, is typically treated with surgical resection when it presents as localized disease. When epithelioid sarcoma recurs or metastasizes, it may be treated with systemic chemotherapy or investigational agents because, other than TAZVERIK, there are no approved systemic therapies specifically indicated for this disease. To the best of our knowledge there are no competitive products in development specifically for epithelioid sarcoma. However, we are aware of several clinical trials run by competitors that recruit patients with soft tissue sarcoma, which is inclusive of epithelioid sarcoma.

EZM0414. Our current intention for EZM0414, through our SET-101 clinical trial, is to focus on patients with t(4;14) multiple myeloma and non t(4;14) multiple myeloma once we reach the Phase 1b expansion portion of the trial. However, based on dose optimization data from the multiple myeloma and DLBCL patients in the Phase 1 dose escalation portion of the trial, we may initiate a third patient cohort in DLBCL in the Phase 1b.

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The most common treatments of multiple myeloma include ImiD (include Revlimid (lenalidomide), Pomalyst (pomalidomide), and Thalidomide (thalomid)), proteasome inhibitors (including Velcade (bortezomib), Kyprolis (xarfilzomib), and Ninlaro (ixazomib)), and anti-CD38 mAb (including Darzalex (daratumumab) and Sarclisa (isatuximab-irfc)) combinations. Current therapies for the relapsed or refractory population also include BCMA targeting CAR-Ts and ADCs. The multiple myeloma pipeline is robust, and includes BCMA CAR-T therapies, bispecific antibodies, BiTEs, and CELMoDs. Additionally, there are assets in development for high risk MM and the t(4;14) subpopulation, including K36’s MMSET inhibitor KTX-1001.

For DLBCL, the most common treatments are chemotherapies, often in combination with the monoclonal antibody Rituxan (rituximab) as well as autologous stem cell transplants. In the relapsed or refractory patient setting, current therapies include CAR-T therapies (Kymriah (tisagenlecleucel), Yescarta (axicabtagene ciloleucel), Breyanzi (lisocabtagene maraleucel)), a CD19 mAb (Monjuvi (tafasitamab)), and ADCs (Policy (polatuzumab vedotin) and Zynlonta (loncastuximab tesirine)). DLBCL pipeline therapies include bispecific antibodies, ADCs, and CAR-T therapies.

While there are many assets in development for both multiple myeloma and DLBCL including those with novel mechanisms of action, other than EZM0414, there are no therapies in development that are SETD2 inhibitors.

Government Regulation and Product Approval

Government authorities in the United States, at the federal, state and local level, and in other countries and foreign jurisdictions, including the European Union, extensively regulate, among other things, the research, development, testing, manufacture, quality control, packaging, storage, record-keeping, labeling, advertising, promotion, distribution, marketing, pricing, reimbursement, import and export of pharmaceutical products such as those we are developing. The processes for obtaining regulatory approvals in the United States and in foreign countries and jurisdictions, along with subsequent compliance with applicable statutes and regulations, require the expenditure of substantial time and financial resources.

United States Government Regulation

In the United States, the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act, or FDCA, and its implementing regulations. It is the responsibility of the company seeking to market a drug to test it and submit evidence that the drug is safe and effective. Failure to comply with applicable United States regulatory requirements at any time during the product development process, approval process or after approval, may subject an applicant to a variety of administrative or judicial sanctions, such as the FDA’s refusal to approve pending NDAs, withdrawal of an approval, imposition of a clinical hold, issuance of warning or untitled letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement or civil or criminal penalties.

The process required by the FDA before a drug may be marketed in the United States generally involves the following:

•completion of preclinical laboratory tests and animal studies in compliance with the FDA’s good laboratory practice regulations;

•design of a clinical protocol and submission to the FDA of an IND which must become effective before human clinical trials may begin;

•manufacture of drug substance and drug product to support clinical trials in compliance with FDA’s cGMP regulations;

•approval by an independent institutional review board, or IRB, at each clinical site before each trial may be initiated;

•performance of human clinical trials, including adequate and well-controlled clinical trials, in accordance with good clinical practices, or GCP, to establish the safety and efficacy of the proposed drug product for each indication;

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•submission to the FDA of an NDA or sNDA requesting marketing approval for one or more proposed indications;

•satisfactory completion of an FDA advisory committee review, if applicable;

•satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the product is produced to assess compliance with current good manufacturing practices, or cGMP, and to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity;

•satisfactory completion of an FDA inspection of selected clinical sites and/or clinical CROs to determine GCP compliance and the integrity of the clinical data submitted in support of the application;

•satisfactory completion of an FDA inspection of the NDA sponsor to assess compliance with GxPs;

•payment of user fees per published Prescription Drug User Fee Act, or PDUFA, guidelines for that year, if applicable;

•FDA review and approval of the NDA or sNDA; and

•commitment to comply with any post-approval requirements, including the potential requirements, to implement a Risk Evaluation and Mitigation Strategy, or REMS, and the potential requirement to conduct post-approval studies.

Preclinical Studies and an IND. Before an applicant begins testing a compound with potential therapeutic value in humans, the product candidate enters the preclinical testing stage. Preclinical studies include laboratory evaluation of product chemistry, toxicity and formulation, as well as animal studies to assess its potential safety and effectiveness. The conduct of the preclinical tests and formulation of the compounds for testing must comply with federal regulations and requirements, including Good Laboratory Practices regulations and standards and the United States Department of Agriculture’s Animal Welfare Act, if applicable.

An IND sponsor must submit the results of the preclinical tests, together with manufacturing information, analytical data and any available clinical data or literature, among other things, to the FDA as part of an IND. An IND is an exemption from the FDCA that allows an unapproved product candidate to be shipped in interstate commerce for use in an investigational clinical trial and a request for FDA authorization to administer such investigational product to humans. An IND automatically becomes effective 30 days after submission and receipt by the FDA unless, before that time, the FDA either provides a “safe to proceed” letter or raises concerns or questions related to one or more proposed clinical trials and places the clinical trial on a clinical hold or partial hold. In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. As a result, submission of an IND may not result in the FDA allowing a clinical trial to commence. Following commencement of a clinical trial under an IND, the FDA may also place a clinical hold or partial clinical hold on a trial.

Clinical Trials. Clinical trials involve the administration of the investigational new drug to human subjects under the supervision of qualified investigators in accordance with GCP requirements, which include the requirement that all research subjects provide their informed consent in writing for their participation in any clinical trial. Clinical trials are conducted under protocols detailing, among other things, the objectives of the trial, the parameters to be used in monitoring safety and the efficacy criteria to be evaluated, if appropriate. A protocol for each clinical trial and any subsequent protocol amendments must be submitted to the FDA as part of the IND. In addition, an IRB at each institution participating in the clinical trial must review and approve the protocol for any clinical trial before it commences at that institution, and the IRB must continue to oversee the clinical trial while it is being conducted. Additionally, some trials are overseen by an independent group of qualified experts organized by the trial sponsor, often known as a data safety monitoring board or committee, or DSMB.

Human clinical trials are typically conducted in four sequential phases, which may overlap or be combined. In Phase 1, the candidate drug is initially introduced into healthy human subjects or patients with the target disease or condition and tested for safety, dosage tolerance, absorption, metabolism, distribution, excretion and, if possible, to gain an initial indication of its effectiveness. In Phase 2, the investigational drug typically is administered to a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage. In Phase 3, the

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candidate drug is administered to an expanded patient population, generally at geographically dispersed clinical trial sites, in well-controlled clinical trials to generate enough data to statistically evaluate the efficacy and safety of the product for approval, to establish the overall risk-benefit profile of the product and to provide adequate information for the labeling of the product. In Phase 4, post-approval studies may be conducted to gain additional experience from the treatment of patients in the intended therapeutic indication. A clinical trial may combine the elements of more than one phase and a company’s designation of a clinical trial as a particular phase is not necessarily indicative that the study will be sufficient to satisfy FDA requirements.

Progress reports detailing the results of the clinical trials must be submitted at least annually to the FDA and more frequently if serious adverse events occur. Clinical trials may not be completed successfully within any specified period, or at all. Furthermore, the FDA or the sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the drug has been associated with unexpected serious harm to patients.

In general, the FDA accepts foreign safety and efficacy studies that were not conducted under an IND provided that they are well designed, well conducted, performed by qualified investigators, and conducted in accordance with ethical principles acceptable to the international community. The conduct of these studies must meet at least minimum standards for assuring human subject protection. Therefore, for studies submitted in support of an NDA that were conducted outside the United States and not under an IND, the agency requires demonstration that such studies were conducted in accordance with GCP, including receiving approval by an independent ethics committee, or IEC, and seeking and receiving informed consent from subjects.

In August 2018, the FDA released a draft guidance entitled “Expansion Cohorts: Use in First-In-Human Clinical Trials to Expedite Development of Oncology Drugs and Biologics,” which outlines how sponsors can utilize an adaptive trial design in the early stages of oncology product development (i.e., the first-in-human clinical trial) to compress the traditional three phases of trials into one continuous trial called an expansion cohort trial. Information to support the design of individual expansion cohorts are included in IND applications and assessed by the FDA. Expansion cohort trials can potentially bring efficiency to product development and reduce developmental costs and time.

Sponsors of clinical trials are required to register and disclose certain clinical trial information on a public registry (clinicaltrials.gov) maintained by the U.S. National Institutes of Health, or NIH. Both NIH and the FDA have recently signaled the government’s willingness to begin enforcing those requirements against non-compliant clinical trial sponsors.

Expanded Access to an Investigational Drug for Treatment Use.

Expanded access, sometimes called “compassionate use,” is the use of investigational new drug products outside of clinical trials to treat patients with serious or immediately life-threatening diseases or conditions when there are no comparable or satisfactory alternative treatment options. The rules and regulations related to expanded access are intended to improve access to investigational drugs for patients who may benefit from investigational therapies who do not otherwise qualify for an ongoing clinical trial. FDA regulations allow access to investigational drugs under an IND by the company or the treating physician for treatment purposes on a case-by-case basis for: individual patients (single-patient IND applications for treatment in emergency settings and non-emergency settings); intermediate-size patient populations; and larger populations for use of the drug under a treatment protocol or Treatment IND Application.

When considering an IND application for expanded access to an investigational product with the purpose of treating a patient or a group of patients, the sponsor and treating physicians or investigators will determine suitability when all of the following criteria apply: patient(s) have a serious or immediately life-threatening disease or condition, and there is no comparable or satisfactory alternative therapy to diagnose, monitor, or treat the disease or condition; the potential patient benefit justifies the potential risks of the treatment and the potential risks are not unreasonable in the context or condition to be treated; and the expanded use of the investigational drug for the requested treatment

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will not interfere initiation, conduct, or completion of clinical investigations that could support marketing approval of the product or otherwise compromise the potential development of the product.

There is no obligation for a sponsor to make its investigational products available for expanded access, but sponsors are required to make their expanded access policies publicly available upon the earlier of initiation of a Phase 2 or Phase 3 study; or 15 days after the drug or biologic receives designation as a breakthrough therapy, fast track product, or regenerative medicine advanced therapy.

In addition to and separate from expanded access, on May 30, 2018, the Right to Try Act, was signed into law. The law, among other things, provides a federal framework for certain patients to access certain investigational new drug products that have completed a Phase 1 clinical trial and that are undergoing investigation for FDA approval. Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA permission under the expanded access program. There is no obligation for a drug manufacturer to make its drug products available to eligible patients as a result of the Right to Try Act, but the manufacturer must develop an internal policy and respond to patient requests according to that policy.

Pediatric Studies. Under the Pediatric Research Equity Act, or PREA, an NDA or supplement to an NDA must contain data that are adequate to assess the safety and effectiveness of the drug for the claimed indications in all relevant pediatric subpopulations, and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective. The FDA may, on its own initiative or at the request of the applicant, grant deferrals for submission of some or all pediatric data until after approval of the product for use in adults, or full or partial waivers from the pediatric data requirements. The FDA maintains a list of diseases that are exempt from PREA requirements due to low prevalence of disease in the pediatric population. Congress amended the FDA Reauthorization Act of 2017, or FDARA. Previously, drugs that had been granted orphan drug designation were exempt from the requirements of the Pediatric Research Equity Act. Under the amended section 505B, beginning on August 18, 2020, the submission of a pediatric assessment, waiver or deferral will be required for certain molecularly targeted cancer indications with the submission of an NDA application or supplement to an NDA application. FL qualifies for an automatic full pediatric waiver by the FDA because it rarely or never occurs in pediatric patients.

The FDA requires that a sponsor who is planning to submit a marketing application for a drug or biological product that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration submit an initial Pediatric Study Plan, or PSP, within sixty days of an end-of-phase 2 meeting or as may be agreed between the sponsor and FDA. The initial PSP must include an outline of the pediatric study or studies that the sponsor plans to conduct, including study objectives and design, age groups, relevant endpoints and statistical approach, or a justification for not including such detailed information, and any request for a deferral of pediatric assessments or a full or partial waiver of the requirement to provide data from pediatric studies along with supporting information. FDA and the sponsor must reach agreement on the PSP. A sponsor can submit amendments to an agreed-upon initial PSP at any time if changes to the pediatric plan need to be considered based on data collected from nonclinical studies, early phase clinical trials, or other clinical development programs.

Submission and Filing of an NDA. Assuming successful completion of the required clinical testing, the results of the preclinical and clinical studies, together with detailed information relating to the product’s chemistry, manufacture, controls and proposed labeling, among other things, are submitted to the FDA as part of an NDA requesting approval to market the product for one or more indications. Under federal law, the submission of most NDAs is subject to an application user fee, which for federal fiscal year 2022 is $3,117,218 for an application requiring clinical data. The sponsor of an approved NDA is also subject to an annual program fee, which for fiscal year 2022 is $369,413. Certain exceptions and waivers are available for some of these fees, such as an exception from the application fee for products with orphan drug designation and a waiver for certain small businesses.

The FDA also may require submission of a REMS plan to mitigate any identified or suspected serious risks. The REMS plan could include medication guides, physician communication plans, assessment plans, and elements to assure safe use, such as restricted distribution methods, patient registries or other risk minimization tools.

Under PDUFA guidelines that are currently in effect, the FDA has agreed to certain performance goals regarding the timing of its review and disposition of an application. The FDA conducts a preliminary review of all NDAs within

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the first 60 days after submission, before accepting them for filing, to determine whether they are sufficiently complete to permit substantive review. The FDA must inform the sponsor at that time or before whether the application is sufficiently complete to permit substantive review. In the event that the FDA determines that an application does not satisfy this standard, it will issue a Refuse to File, or RTF, determination to the applicant. The FDA may request additional information rather than accept an NDA for filing. In this event, the application must be resubmitted with the additional information. The resubmitted application is also subject to review before the FDA accepts it for filing.

If the submission is accepted for filing, the FDA begins an in-depth substantive review. The FDA reviews an NDA to determine, among other things, whether the drug is safe and effective and whether the facility in which it is manufactured, processed, packaged or held meets standards designed to assure the product’s continued safety, quality and purity. Under the goals and policies agreed to by the FDA under PDUFA, the FDA has ten months from the filing date in which to complete its initial review of a standard application that is a new molecular entity, and six months from the filing date for an application with “priority review.” The review process may be extended by the FDA for three additional months to consider new information or in the case of a clarification provided by the sponsor to address an outstanding deficiency identified by the FDA following the original submission. Despite these review goals, it is not uncommon for FDA review of an application to extend beyond the PDUFA goal date.

In connection with its review of an NDA, the FDA typically will inspect the facility or facilities where the product is manufactured. The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and are adequate to assure consistent production of the product within required specifications. Additionally, the FDA will typically inspect one or more clinical trial sites to assure compliance with GCPs, may inspect the clinical CRO(s) to assure compliance with GCPs, and the FDA may also perform a sponsor inspection.

The FDA has the option to refer questions regarding their review of a marketing application for a New Molecular Entity, or NME, to an external advisory committee. An advisory committee is a panel of independent experts, including clinicians and other scientific experts, that reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions. The FDA uses approximately 50 advisory committees and panels to obtain independent expert advice on scientific, technical, and policy matters. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.

Decisions on an NDA

The FDA reviews an application to determine, among other things, whether the product is safe and whether it is effective for its intended use(s), with the latter determination being made on the basis of substantial evidence.
The FDA has interpreted this evidentiary standard to require at least two adequate and well-controlled clinical investigations to establish effectiveness of a new product. Under certain circumstances, however, the FDA has indicated that a single trial with certain characteristics and additional information may satisfy this standard. Ultimately, the FDA will determine whether the expected benefits of the drug product outweigh its potential risks to patients.

After evaluating the NDA and all related information, including the advisory committee recommendation, if any, and inspection reports regarding the manufacturing facilities and clinical trial sites, the FDA may issue a complete response letter or an approval letter. A complete response letter generally contains a statement of specific conditions that must be met in order to secure final approval of the NDA and may require additional clinical or preclinical testing in order for FDA to reconsider the application. Even with submission of this additional information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval.

An approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications. Even if the FDA approves a product, it may limit the approved indications for use of the product, require that contraindications, warnings or precautions be included in the product labeling, including a boxed warning, require that post-approval studies, including Phase 4 clinical trials, be conducted to further assess a drug’s safety after approval, require testing and surveillance programs to monitor the product after commercialization, or impose other conditions, including distribution restrictions or other risk management mechanisms under a REMS

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which can materially affect the potential market and profitability of the product. The FDA may prevent or limit further marketing of a product based on the results of post-marketing studies or surveillance programs. After approval, some types of changes to the approved product, such as adding new indications, manufacturing changes, and additional labeling claims, are subject to further testing requirements and FDA review and approval.

Orphan Drug Designation. Under the Orphan Drug Act, the FDA may grant orphan drug designation to a drug (including a biologic) intended to treat a rare disease or condition, which is generally 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 and for which there is no reasonable expectation that the cost of developing and making available in the United States a drug for this type of disease or condition will be recovered from sales in the United States for that drug. Orphan drug designation must be requested before submitting an NDA or biologics license application, or BLA. After the FDA grants orphan drug designation, the identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA.

Orphan drug designation qualifies the sponsor of the drug for various development incentives. For example, a marketing application for a prescription drug product that has received orphan drug designation is not subject to a prescription drug user fee unless the application includes an indication other than for the rare disease or condition for which the drug was designated. Furthermore, federal law establishes certain tax credits designed to encourage the development of orphan drugs. With passage of the Tax Cuts and Jobs Act of 2017, that tax credit was halved from 50% to 25%. The granting of an orphan drug designation request does not alter the standard regulatory requirements and process for obtaining marketing approval. Safety and effectiveness of a drug must be established through adequate and well-controlled studies.

Special FDA Expedited Review and Approval Programs. The FDA has various programs, including Fast Track Designation, Accelerated Approval, Priority Review and Breakthrough Therapy Designation, that are intended to expedite or simplify the process for the development and FDA review of drugs that are intended for the treatment of serious or life threatening diseases or conditions and demonstrate the potential to address unmet medical needs. The purpose of these programs is to provide important new drugs to patients earlier than under standard FDA review procedures. Even if a product qualifies for one or more of these programs, the FDA may later decide that the product no longer meets the conditions for qualification or decide that the time period for FDA review or approval will not be shortened. None of these expedited programs changes the standards for approval but they may help expedite the development or approval process of product candidates.

Breakthrough Therapy Designation. Under the provisions of the Food and Drug Administration Safety and Innovation Act, or FDASIA, enacted in 2012, a sponsor can request designation of a product candidate as a “breakthrough therapy.” The FDA may grant breakthrough therapy designation to a drug that is intended, alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition, and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. The FDA must take certain actions, such as holding timely meetings and providing advice, intended to expedite the development and review of an application for approval of a breakthrough therapy. For drugs and biologics that have been designated as breakthrough therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens. Drugs designated as breakthrough therapies by the FDA are also eligible for accelerated approval.

Fast Track Designation. To be eligible for a Fast Track Designation, the FDA must determine, based on the request of a sponsor, that a product is intended to treat a serious or life-threatening disease or condition and demonstrates the potential to address an unmet medical need. The FDA will determine that a product will fill an unmet medical need if it will provide a therapy where none exists or provide a therapy that may be potentially superior to existing therapy based on efficacy or safety factors. For Fast Track products, sponsors may have greater interactions with the FDA regarding drug development and may submit sections of a Fast Track product’s NDA on a rolling basis before the entire application is complete.

Priority Review. The FDA may give a priority review designation to drugs that offer major advances in treatment, or provide a treatment where no adequate therapy exists. A priority review means that the goal for the FDA to review

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an application is six months, rather than the standard review of ten months under current PDUFA guidelines. These six- and ten-month review periods are measured from the “filing” date rather than the receipt date for NDAs for new molecular entities, which typically adds approximately two months to the timeline for review and decision from the date of submission. Most products that are eligible for Fast Track designation are also likely to be considered appropriate to receive a priority review.

Accelerated Approval. In addition, products studied for their safety and effectiveness in treating serious or life-threatening illnesses and that provide meaningful therapeutic benefit over existing treatments may receive accelerated approval and may be approved on the basis of well-conducted clinical trials establishing that the drug product has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity or prevalence of the condition and the availability or lack of alternative treatments. As a condition of accelerated approval, the FDA may require a sponsor to perform post-marketing confirmatory study(ies) to verify and describe the predicted effect on irreversible morbidity or mortality or other clinical endpoints, and the drug may be subject to accelerated withdrawal procedures. Although a drug may be designated as “breakthrough” or “fast track”, the determination of accelerated approval is based on the clinical endpoint and not on the expeditious manner in which it is being developed.

FDA Regulation of Companion Diagnostics. Safe and effective use of a drug may rely upon an in vitro companion diagnostic for use in selecting the patients that will be more likely to respond to the treatment. FDA officials have issued guidance that addresses issues critical to developing in vitro companion diagnostics, such as when the FDA will require that the diagnostic and the drug be approved simultaneously. The guidance issued in August 2014 states that if safe and effective use of a therapeutic product depends on an in vitro diagnostic, then the FDA generally will require approval or clearance of the diagnostic at the same time that the FDA approves the therapeutic product. In April 2020, the FDA issued additional guidance which describes considerations for the development and labeling of companion diagnostic devices to support the indicated uses of multiple drug or biological oncology products, when appropriate.

Under the FDCA, in vitro diagnostics, including companion diagnostics, are regulated as medical devices. The FDA generally requires that devices, or in vitro companion diagnostics, intended to select the patients who will respond to the cancer treatment to obtain Pre-Market Approval, or PMA, simultaneously with approval of the drug. Based on the guidance, and the FDA’s past treatment of companion diagnostics, the FDA will typically require PMA approval of one or more in vitro companion diagnostics to identify patient populations suitable for these cancer therapies.

The PMA process, including the gathering of clinical and preclinical data and the submission to and review by the FDA involves a rigorous premarket review during which the applicant must prepare and provide the FDA with reasonable assurance of the device’s safety and effectiveness and information about the device and its components regarding, among other things, device design, manufacturing and labeling. PMA applications are subject to an application fee. For federal fiscal year 2021, the standard fee is $374,858 and the small business fee is $93,714.

After a device is placed on the market, it remains subject to significant regulatory requirements. Medical devices may be marketed only for the uses and indications for which they are cleared or approved. Device manufacturers must also establish registration and device listings with the FDA. A medical device manufacturer’s manufacturing processes and those of its suppliers are required to comply with the applicable portions of the Quality System Regulation, or QSR, which cover the methods and documentation of the design, testing, production, processes, controls, quality assurance, labeling, packaging and shipping of medical devices. Domestic facility records and manufacturing processes are subject to periodic unscheduled inspections by the FDA. The FDA also may inspect foreign facilities that export products to the U.S.

Post-Approval Commitments and Requirements. Drugs manufactured or distributed pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to recordkeeping, periodic reporting, product sampling and distribution, advertising and promotion and reporting of adverse experiences with the product. After approval, most changes to the approved product, such as adding new indications or other labeling claims are subject to prior FDA review and approval. There also are continuing, annual

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user fee requirements for any marketed products and the establishments at which such products are manufactured, as well as new application fees for supplemental applications with clinical data.

The FDA may impose a number of post-approval requirements as a condition of approval of an NDA. For example, the FDA may require post-marketing testing, including Phase 4 clinical trials and surveillance to further assess and monitor the product’s safety and effectiveness after commercialization.

In addition, drug manufacturers and other entities involved in the manufacture and distribution of approved drugs are required to register their establishments with the FDA and state agencies, and are subject to periodic unannounced inspections by the FDA and these state agencies for compliance with cGMP requirements. Changes to the manufacturing process are strictly regulated and often require prior FDA approval before being implemented. FDA regulations also require investigation and correction of any deviations from cGMP and impose reporting and documentation requirements upon the sponsor and any third-party manufacturers that the sponsor may decide to use. Accordingly, manufacturers must continue to expend time, money and effort in the area of production and quality control to maintain cGMP compliance.

Once an approval is granted, the FDA may withdraw the approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market.

Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in mandatory revisions to the approved labeling to add new safety information; imposition of post-market studies or clinical trials to assess new safety risks; or imposition of distribution or other restrictions under a REMS program. Other potential consequences include, among other things:

•restrictions on the marketing or manufacturing of the product, complete withdrawal of the product from the market or product recalls;

•fines, warning letters or holds on post-approval clinical trials;

•refusal of the FDA to approve pending NDAs or supplements to approved NDAs, or suspension or revocation of product license approvals;

•product seizure or detention, or refusal to permit the import or export of products; or

•injunctions or the imposition of civil or criminal penalties.

The FDA strictly regulates marketing, labeling, advertising and promotion of products that are placed on the market. Drugs may be promoted only for the approved indications and in accordance with the provisions of the approved label. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off label uses, and a company that is found to have improperly promoted off label uses may be subject to significant liability. If a company is found to have promoted off label uses, it may become subject to adverse public relations and administrative and judicial enforcement by the FDA, the Department of Justice, or the Office of the Inspector General of the Department of Health and Human Services, as well as state authorities. This could subject a company to a range of penalties that could have a significant commercial impact, including civil and criminal fines and agreements that materially restrict the manner in which a company promotes or distributes drug products. In September 2021, the FDA published final regulations which describe the types of evidence that the agency will consider in determining the intended use of a drug product.

In addition, the distribution of prescription pharmaceutical products is subject to the Prescription Drug Marketing Act, or PDMA, and its implementing regulations, as well as the Drug Supply Chain Security Act, or DSCA, which regulate the distribution and tracing of prescription drugs and prescription drug samples at the federal level, and set minimum standards for the regulation of drug distributors by the states. The PDMA, its implementing regulations and state laws limit the distribution of prescription pharmaceutical product samples, and the DSCA imposes requirements to ensure accountability in distribution and to identify and remove counterfeit and other illegitimate products from the market.

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Federal and State Fraud and Abuse and Data Privacy and Security Laws and Regulations. In addition to FDA restrictions on marketing of pharmaceutical products, federal and state fraud and abuse laws restrict business practices in the biopharmaceutical industry. These laws include anti-kickback and false claims laws and regulations as well as data privacy and security laws and regulations.

The federal Anti-Kickback Statute prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving remuneration to induce or in return for purchasing, leasing, ordering, or arranging for or recommending the purchase, lease, or order of any item or service reimbursable under Medicare, Medicaid or other federal healthcare programs. The term “remuneration” has been broadly interpreted to include anything of value. The Anti-Kickback Statute has been interpreted to apply to arrangements between pharmaceutical manufacturers on one hand and prescribers, purchasers, and formulary managers on the other. Although there are a number of statutory exemptions and regulatory safe harbors protecting some common activities from prosecution, the exemptions 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 exemption or safe harbor. Several courts have interpreted the statute’s intent requirement to mean that if any one purpose of an arrangement involving remuneration is to induce referrals of federal healthcare covered business, the statute has been violated.

The reach of the Anti-Kickback Statute was also broadened by the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively PPACA, which, among other things, amended the intent requirement of the federal Anti-Kickback Statute such that a person or entity no longer needs to have actual knowledge of this statute or specific intent to violate it in order to have committed a violation. In addition, PPACA 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 civil False Claims Act or the civil monetary penalties statute, which imposes penalties against any person who is determined to have presented or caused to be presented a claim to a federal health program that the person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent. PPACA also created new federal requirements for reporting, by applicable manufacturers of covered drugs, payments and other transfers of value to physicians and teaching hospitals.

The federal False Claims Act prohibits any person from knowingly presenting, or causing to be presented, a false claim for payment to the federal government or knowingly making, using, or causing to be made or used a false record or statement material to a false or fraudulent claim to the federal government. A claim includes “any request or demand” for money or property presented to the U.S. 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, created new federal criminal statutes that prohibit knowingly and willfully executing 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. Also, many states have similar fraud and abuse statutes or regulations that apply to items and services reimbursed under Medicaid and other state programs, or, in several states, apply regardless of the payor.

We may also be subject to data privacy and security regulation by both the federal government and the states in which we conduct our business. HIPAA, as amended by the Health Information Technology and Clinical Health Act, or HITECH, and its implementing regulations, imposes specified requirements relating to the privacy, security and transmission of individually identifiable health information. Among other things, HITECH makes HIPAA’s privacy and security standards directly applicable to “business associates,” defined as independent contractors or agents of covered entities that receive or obtain protected health information in connection with providing a service on behalf of a covered entity. HITECH also increased the civil and criminal penalties that may be imposed against covered entities, business associates and possibly other persons, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorney’s fees and costs associated with pursuing federal civil actions. In addition, state laws govern the privacy and security

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of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.

In addition, federal transparency requirements known as the federal Physician Payments Sunshine Act, under the Patient Protection and Affordable Care Act, as amended by the Health Care Education Reconciliation Act, or the Affordable Care Act, require certain manufacturers of drugs, devices, biologics and medical supplies to report annually to the Centers for Medicare & Medicaid Services, within the United States Department of Health and Human Services, information related to payments and other transfers of value made by that entity to physicians, other healthcare providers and teaching hospitals, as well as ownership and investment interests held by physicians, other healthcare providers and their immediate family members. Some state laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government in addition to requiring drug manufacturers to report information related to payments and other transfers of value to physicians and other health care providers, and restrict marketing practices or require disclosure of marketing expenditures.

To the extent that any of our products are sold in a foreign country, we may be subject to similar foreign laws and regulations, which may include, for instance, applicable post-marketing requirements, including safety surveillance, anti-fraud and abuse laws, and implementation of corporate compliance programs and reporting of payments or transfers of value to healthcare professionals.

Coverage and Reimbursement. Government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which medications they will pay for and establish corresponding reimbursement levels. In particular, in the United States, private health insurers and other third-party payors often provide reimbursement for products and services based on the level at which the government (through the Medicare or Medicaid programs) provides reimbursement for such treatments. In the United States, the European Union and other potentially significant markets for our product candidates, government authorities and third-party payors are increasingly attempting to limit or regulate the price of medical products and services, particularly for new and innovative products and therapies, which often has resulted in average selling prices lower than they would otherwise be. Further, the increased emphasis on managed healthcare in the United States and on country and regional pricing and reimbursement controls in the European Union will put additional pressure on product pricing, reimbursement and usage, which may adversely affect our future product sales and results of operations. These pressures can arise from rules and practices of managed care groups, judicial decisions and governmental laws and regulations related to Medicare, Medicaid and healthcare reform, pharmaceutical reimbursement policies and pricing in general.

Third-party payors are increasingly imposing additional requirements and restrictions on coverage and limiting reimbursement levels for medical products. For example, federal and state governments reimburse covered prescription drugs at varying rates generally below average wholesale price. These restrictions and limitations influence the purchase of healthcare services and products. Legislative proposals to reform healthcare or reduce costs under government insurance programs may result in lower reimbursement for our products and product candidates or exclusion of our products and product candidates from coverage. The cost containment measures that healthcare payors and providers are instituting and any healthcare reform could significantly reduce our revenues from the sale of any approved product candidates. We cannot provide any assurances that we will be able to obtain and maintain third-party coverage or adequate reimbursement for our product candidates in whole or in part.

Impact of Healthcare Reform on Coverage, Reimbursement, and Pricing. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003, or the MMA, imposed new requirements for the distribution and pricing of prescription drugs for Medicare beneficiaries. Under Part D, Medicare beneficiaries may enroll in prescription drug plans offered by private entities that provide coverage of outpatient prescription drugs. Part D plans include both standalone prescription drug benefit plans and prescription drug coverage as a supplement to Medicare Advantage plans. Unlike Medicare Part A and B, Part D coverage is not standardized. Part D prescription drug plan sponsors are not required to pay for all covered Part D drugs, and each drug plan can develop its own drug formulary that identifies which drugs it will cover and at what tier or level. However, Part D prescription drug formularies must include drugs within each therapeutic category and class of covered Part D drugs, though not necessarily all the drugs in each category or class. Any formulary used by a Part D prescription drug plan must be developed and reviewed by a pharmacy and therapeutic committee. Government payment for some of the costs of

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prescription drugs may increase demand for any products for which we receive marketing approval. However, any negotiated prices for our future products covered by a Part D prescription drug plan will likely be lower than the prices we might otherwise obtain. Moreover, while the MMA applies only to drug benefits for Medicare beneficiaries, private payors often follow Medicare coverage policy and payment limitations in setting their own payment rates. Any reduction in payment that results from Medicare Part D may result in a similar reduction in payments from non-governmental payors.

The American Recovery and Reinvestment Act of 2009 provides funding for the federal government to compare the effectiveness of different treatments for the same illness. A plan for the research will be developed by the Department of Health and Human Services, the Agency for Healthcare Research and Quality and the National Institutes for Health, and periodic reports on the status of the research and related expenditures will be made to Congress. Although the results of the comparative effectiveness studies are not intended to mandate coverage policies for public or private payors, it is not clear what effect, if any, the research will have on the sales of any product, if any such product or the condition that it is intended to treat is the subject of a study. It is also possible that comparative effectiveness research demonstrating benefits in a competitor’s product could adversely affect the sales of our product candidates. If third-party payors do not consider our product candidates to be cost-effective compared to other available therapies, they may not cover our product candidates, once approved, as a benefit under their plans or, if they do, the level of payment may not be sufficient to allow us to sell our products on a profitable basis.

The United States and some foreign jurisdictions are considering enacting or have enacted a number of additional legislative and regulatory proposals to change the healthcare system in ways that could affect our ability to sell our products profitably. 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 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, including, most recently, PPACA, which became law in March 2010 and substantially changed the way healthcare is financed by both governmental and private insurers. Among the provisions of the Affordable Care Act of importance to potential product candidates are:

•an annual, nondeductible fee on any entity that manufactures or imports specified branded prescription drugs and biologic agents, apportioned among these entities according to their market share in certain government healthcare programs, although this fee would not apply to sales of certain products approved exclusively for orphan indications;

•expansion of eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to certain individuals with income at or below 133% of the federal poverty level, thereby potentially increasing a manufacturer’s Medicaid rebate liability;

•expanded manufacturers’ rebate liability under the Medicaid Drug Rebate Program by increasing the minimum rebate for both branded and generic drugs and revising the definition of “average manufacturer price,” or AMP, for calculating and reporting Medicaid drug rebates on outpatient prescription drug prices and extending rebate liability to prescriptions for individuals enrolled in Medicare Advantage plans;

•addressed 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;

•expanded the types of entities eligible for the 340B drug discount program;

•established the Medicare Part D coverage gap discount program by requiring manufacturers to provide a 50% point-of-sale-discount off the negotiated price of applicable brand drugs to eligible beneficiaries during their coverage gap period as a condition for the manufacturers’ outpatient drugs to be covered under Medicare Part D;

•a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research;

•the Independent Payment Advisory Board, or IPAB, which has authority to recommend certain changes to the Medicare program to reduce expenditures by the program that could result in reduced payments

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for prescription drugs. However, the IPAB implementation has not been clearly defined. PPACA provided that under certain circumstances, IPAB recommendations will become law unless Congress enacts legislation that will achieve the same or greater Medicare cost savings; and

•established the Center for Medicare and Medicaid Innovation within CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending. Funding has been allocated to support the mission of the Center for Medicare and Medicaid Innovation from 2011 to 2019.

Other legislative changes have been proposed and adopted in the United States since the Affordable Care Act was enacted. For example, in August 2011, the Budget Control Act of 2011, among other things, created measures for spending reductions by Congress. A Joint Select Committee on Deficit Reduction, tasked with recommending a targeted deficit reduction of at least $1.2 trillion for the years 2012 through 2021, was unable to reach required goals, thereby triggering the legislation’s automatic reduction to several government programs. This includes aggregate reductions of Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2031, pursuant to the Coronavirus Aid, Relief and Economic Security Act. These Medicare sequester reductions have been suspended through the end of March 2022. From April 2022 through June 2022 a 1% sequester cut will be in effect, with the full 2% cut resuming thereafter. Further, in January 2013, the American Taxpayer Relief Act of 2012 became law, which, among other things, further reduced Medicare payments to several providers, including hospitals, imaging centers 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 healthcare reforms, as well as other healthcare reform measures that may be adopted in the future, may result in additional reductions in Medicare and other healthcare funding, more rigorous coverage criteria, new payment methodologies and additional downward pressure on the price for any approved product and/or the level of reimbursement physicians receive for administering any approved product. Reductions in reimbursement levels may negatively impact the prices or the frequency with which products are prescribed or administered. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors. Since enactment of the PPACA, there have been numerous legal challenges and Congressional actions to repeal and replace provisions of the law.

Since enactment of the PPACA, there have been, and continue to be, numerous legal challenges and Congressional actions to repeal and replace provisions of the law. For example, with enactment of the Tax Cuts and Jobs Act of 2017, which was signed by President Trump on December 22, 2017, Congress repealed the “individual mandate.” The repeal of this provision, which requires most Americans to carry a minimal level of health insurance, became effective in 2019. Additionally, the 2020 federal spending package permanently eliminated, effective January 1, 2020, the PPACA-mandated “Cadillac” tax on high-cost employer-sponsored health coverage and medical device tax and, effective January 1, 2021, also eliminates the health insurer tax. Further, the Bipartisan Budget Act of 2018, among other things, amended the PPACA, effective January 1, 2019, to increase from 50 percent to 70 percent the point-of-sale discount that is owed by pharmaceutical manufacturers who participate in Medicare Part D and to close the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole.”

Since enactment of the PPACA, there have been, and continue to be, numerous legal challenges and Congressional actions to repeal and replace provisions of the law. For example, with enactment of the Tax Cuts and Jobs Act of 2017, or the Tax Act, which was signed by President Trump on December 22, 2017, Congress repealed the “individual mandate.” The repeal of this provision, which requires most Americans to carry a minimal level of health insurance, became effective in 2019. On December 14, 2018, a U.S. District Court judge in the Northern District of Texas ruled that the individual mandate portion of the PPACA is an essential and inseverable feature of the PPACA, and therefore because the mandate was repealed as part of the Tax Act, the remaining provisions of the PPACA are invalid as well. The U.S. Supreme Court heard this case on November 10, 2020 and, on June 17, 2021, dismissed this action after finding that the plaintiffs do not have standing to challenge the constitutionality of the ACA. Litigation and legislation over the PPACA are likely to continue, with unpredictable and uncertain results.

The Trump Administration also took executive actions to undermine or delay implementation of the PPACA, including directing federal agencies with authorities and responsibilities under the PPACA to waive, defer, grant exemptions from, or delay the implementation of any provision of the PPACA that would impose a fiscal or

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regulatory burden on states, individuals, healthcare providers, health insurers, or manufacturers of pharmaceuticals or medical devices. On January 28, 2021, however, President Biden rescinded those orders and issued a new executive order that directs federal agencies to reconsider rules and other policies that limit access to healthcare, and consider actions that will protect and strengthen that access. Under this order, federal agencies are directed to re-examine: policies that undermine protections for people with pre-existing conditions, including complications related to COVID‑19; demonstrations and waivers under Medicaid and the PPACA that may reduce coverage or undermine the programs, including work requirements; policies that undermine the Health Insurance Marketplace or other markets for health insurance; policies that make it more difficult to enroll in Medicaid and under the PPACA; and policies that reduce affordability of coverage or financial assistance, including for dependents.

The costs of prescription pharmaceuticals have also been the subject of considerable discussion in the United States To date, there have been several recent U.S. congressional inquiries, as well as proposed and enacted state and federal legislation designed to, among other things, bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient programs, reduce the costs of drugs under Medicare and reform government program reimbursement methodologies for drug products. In 2020, President Trump issued several executive orders intended to lower the costs of prescription products and certain provisions in these orders have been incorporated into regulations. These regulations include an interim final rule implementing a most favored nation model for prices that would tie Medicare Part B payments for certain physician-administered pharmaceuticals to the lowest price paid in other economically advanced countries, effective January 1, 2021. That rule, however, has been subject to a nationwide preliminary injunction and, on December 29, 2021, CMS issued a final rule to rescind it. With issuance of this rule, CMS stated that it will explore all options to incorporate value into payments for Medicare Part B pharmaceuticals and improve beneficiaries’ access to evidence-based care.

In addition, in October 2020, the Department of Health and Human Services, or HHS, and the FDA published a final rule allowing states and other entities to develop a Section 804 Importation Program, or SIP, to import certain prescription drugs from Canada into the United States. The final rule is currently the subject of ongoing litigation, but at least six states (Vermont, Colorado, Florida, Maine, New Mexico, and New Hampshire) have passed laws allowing for the importation of drugs from Canada with the intent of developing SIPs for review and approval by the FDA. Further, on November 20, 2020, 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 new safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers, the implementation of which have also been delayed by the Biden administration until January 1, 2023.

On July 9, 2021, President Biden signed Executive Order 14063, which focuses on, among other things, the price of pharmaceuticals. The order directs HHS to create a plan within 45 days to combat “excessive pricing of prescription pharmaceuticals and enhance domestic pharmaceutical supply chains, to reduce the prices paid by the federal government for such pharmaceuticals, and to address the recurrent problem of price gouging.” On September 9, 2021, HHS released its plan to reduce pharmaceutical prices. The key features of that plan are to: (a) make pharmaceutical prices more affordable and equitable for all consumers and throughout the health care system by supporting pharmaceutical price negotiations with manufacturers; (b) improve and promote competition throughout the prescription pharmaceutical industry by supporting market changes that strengthen supply chains, promote biosimilars and generic drugs, and increase transparency; and (c) foster scientific innovation to promote better healthcare and improve health by supporting public and private research and making sure that market incentives promote discovery of valuable and accessible new treatments.

At the state level, individual states are increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical 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. A number of states, for example, require drug manufacturers and other entities in the drug supply chain, including health carriers, pharmacy benefit managers, wholesale distributors, to disclose information about pricing of pharmaceuticals. In addition, regional healthcare organizations and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription pharmaceutical and other

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healthcare programs. These measures could reduce the ultimate demand for our products, once approved, or put pressure on our product pricing. We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures.

Exclusivity and Approval of Competing Products

Patent Term Restoration and Extension. A patent claiming a new drug product may be eligible for a limited patent term extension under the Hatch-Waxman Act, which permits a patent restoration of up to five years for patent term lost during product development and the FDA regulatory review. The restoration period granted is typically one-half the time between the effective date of an IND and the submission date of an NDA, plus the time between the submission date of an NDA and the ultimate approval date. Patent term restoration cannot be used to extend the remaining term of a patent past a total of 14 years from the product’s approval date. Only one patent applicable to an approved drug product is eligible for the extension, and the application for the extension must be submitted prior to the expiration of the patent in question. A patent that covers multiple drugs for which approval is sought can only be extended in connection with one of the approvals. The United States Patent and Trademark Office, or USPTO, reviews and approves the application for any patent term extension or restoration in consultation with the FDA.

Hatch-Waxman Patent Exclusivity. In seeking approval for a drug through an NDA, applicants are required to list with the FDA each patent with claims that cover the applicant’s product or a method of using the product. Upon approval of a drug, each of the patents listed in the application for the drug is then published in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations, commonly known as the Orange Book. Drugs listed in the Orange Book can, in turn, be cited by potential competitors in support of approval of an abbreviated new drug application, or ANDA, or 505(b)(2) NDA. The FDA’s regulations governing patient listings were largely codified into law with enactment of the Orange Book Modernization Act in January 2021.

Generally, an ANDA provides for marketing of a drug product that has the same active ingredients in the same strengths, dosage form and route of administration as the listed drug and has been shown to be bioequivalent through in vitro or in vivo testing or otherwise to the listed drug. ANDA applicants are not required to conduct or submit results of preclinical or clinical tests to prove the safety or effectiveness of their drug product, other than the requirement for bioequivalence testing. Drugs approved in this way are commonly referred to as “generic equivalents” to the listed drug, and can often be substituted by pharmacists under prescriptions written for the original listed drug.

A 505(b)(2) application applies to a drug for which the investigations made to show whether or not the drug is safe for use and effective in use and relied upon by the applicant for approval of the application “were not conducted by or for the applicant and for which the applicant has not obtained a right of reference or use from the person by or for whom the investigations were conducted.” As with an ANDA, Section 505(b)(2) authorizes the FDA to approve an NDA based on safety and effectiveness data that were not developed by the applicant. 505(b)(2) NDAs generally are submitted for changes to a previously approved drug product, such as a new dosage form or indication.

The ANDA or 505(b)(2) NDA applicant is required to certify to the FDA concerning any patents listed for the approved product in the FDA’s Orange Book, except for patents covering methods of use for which the ANDA applicant is not seeking approval. Specifically, the applicant must certify with respect to each patent that:

•the required patent information has not been filed;

•the listed patent has expired;

•the listed patent has not expired, but will expire on a particular date and approval is sought after patent expiration; or

•the listed patent is invalid, unenforceable, or will not be infringed by the new product.

Generally, the ANDA or 505(b)(2) NDA cannot be approved until all listed patents have expired, except when the ANDA or 505(b)(2) NDA applicant challenges a listed drug. A certification that the proposed product will not

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infringe the already approved product’s listed patents or that such patents are invalid or unenforceable is called a Paragraph IV certification. If the applicant does not challenge the listed patents or indicate that it is not seeking approval of a patented method of use, the ANDA or 505(b)(2) NDA application will not be approved until all the listed patents claiming the referenced product have expired.

If the ANDA or 505(b)(2) NDA applicant has provided a Paragraph IV certification to the FDA, the applicant must also send notice of the Paragraph IV certification to the NDA and patent holders once the application has been accepted for filing by the FDA. The NDA and patent holders may then initiate patent infringement litigation in response to the notice of the Paragraph IV certification. The filing of a patent infringement lawsuit within 45 days after the receipt of notice of the Paragraph IV certification automatically prevents the FDA from approving the ANDA or 505(b)(2) NDA until the earlier of 30 months, expiration of the patent, settlement of the lawsuit or a decision in the infringement case that is favorable to the ANDA applicant.

Hatch-Waxman Non-Patent Exclusivity. Market and data exclusivity provisions under the FDCA also can delay the submission or the approval of ANDAs and 505(b)(2) NDAs for competing products. The FDCA provides a five-year period of non-patent data exclusivity within the United States to the first applicant to gain approval of an NDA for a new chemical entity. A drug is a new chemical entity if the FDA has not previously approved any other new drug containing the same active moiety, which is the molecule or ion responsible for the activity of the drug substance. This interpretation was confirmed with enactment of the Ensuring Innovation Act in April 2021. During the exclusivity period, the FDA may not accept for review an ANDA or a 505(b)(2) NDA submitted by another company that contains the previously approved active moiety. However, an ANDA or 505(b)(2) NDA may be submitted after four years if it contains a certification of patent invalidity or non-infringement.

The FDCA also provides three years of marketing exclusivity for an NDA, 505(b)(2) NDA, or supplement to an existing NDA or 505(b)(2) NDA if new clinical investigations, other than bioavailability studies, that were conducted or sponsored by the applicant, are deemed by the FDA to be essential to the approval of the application or supplement. Three-year exclusivity may be awarded for changes to a previously approved drug product, such as new indications, dosages, strengths or dosage forms of an existing drug. This three-year exclusivity covers only the conditions of use associated with the new clinical investigations and, as a general matter, does not prohibit the FDA from approving ANDAs or 505(b)(2) NDAs for generic versions of the original, unmodified drug product. Five-year and three-year exclusivity will not delay the submission or approval of a full NDA; however, an applicant submitting a full NDA would be required to conduct or obtain a right of reference to all of the preclinical studies and adequate and well-controlled clinical trials necessary to demonstrate safety and effectiveness.

The FDA must establish a priority review track for certain generic drugs, requiring the FDA to review a drug application within eight months for a drug that has three or fewer approved drugs listed in the Orange Book and is no longer protected by any patent or regulatory exclusivities, or is on the FDA’s drug shortage list. The new legislation also authorizes FDA to expedite review of ‘‘competitor generic therapies’’ or drugs with inadequate generic competition, including holding meetings with or providing advice to the drug sponsor prior to submission of the application.

Orphan Drug Exclusivity. Under the Orphan Drug Act, a drug that is approved for the orphan drug designated indication is granted seven years of orphan drug exclusivity. Orphan drug exclusivity means that the FDA may not approve another sponsor’s marketing application for the same drug for the same indication for seven years, except in certain limited circumstances. Orphan exclusivity does not block the approval of a different product for the same rare disease or condition, nor does it block the approval of the same product for different indications. If a drug or biologic designated as an orphan drug ultimately receives marketing approval for an indication broader than what was designated in its orphan drug application, it may not be entitled to exclusivity.

Orphan drug exclusivity will also not bar approval of another product under certain circumstances, including if a subsequent product with the same drug or biologic for the same indication is shown to be clinically superior to the approved product on the basis of greater efficacy or safety, or providing a major contribution to patient care, or if the company with orphan drug exclusivity is not able to meet market demand. This is the case despite an earlier court opinion holding that the Orphan Drug Act unambiguously required the FDA to recognize orphan exclusivity regardless of a showing of clinical superiority.

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In September 2021, the Court of Appeals for the 11th Circuit held that, for the purpose of determining the scope of market exclusivity, the term “same disease or condition” in the statute means the designated “rare disease or condition” and could not be interpreted by the FDA to mean the “indication or use.” Thus, the court concluded, orphan drug exclusivity applies to the entire designated disease or condition rather than the “indication or use.” It is unclear how this court decision will be implemented by the FDA.

Pediatric Exclusivity. Pediatric exclusivity is another type of non-patent marketing exclusivity in the United States and, if granted, provides for the attachment of an additional six months of marketing protection to the term of any existing regulatory exclusivity, including the non-patent and orphan drug exclusivity periods described above, and any listed patent. This six-month exclusivity may be granted if an NDA sponsor submits pediatric data that fairly respond to a written request from the FDA for such data. The data do not need to show the product to be effective in the pediatric population studied; rather, if the clinical trial is deemed to fairly respond to the FDA’s request, the additional protection is granted. If reports of requested pediatric studies are submitted to and accepted by the FDA within the statutory time limits, whatever statutory or regulatory periods of exclusivity or Orange Book listed patent protection cover the drug are extended by six months. This is not a patent term extension, but it effectively extends the regulatory period during which the FDA cannot approve an ANDA or 505(b)(2) application owing to regulatory exclusivity or listed patents. When any of our products is approved, we anticipate seeking pediatric exclusivity when it is appropriate.

European Union Drug Approval Process

In order to market any product outside of the United States, we would need to comply with numerous and varying regulatory requirements of other countries regarding safety and efficacy and governing, among other things, clinical trials, marketing authorization, commercial sales and distribution of our products. Whether or not we obtain FDA approval for a product, we would need to obtain the necessary approvals by the comparable regulatory authorities of foreign countries before we can commence clinical trials or marketing of the product in those countries. The approval process varies from country to country and can involve additional product testing and additional administrative review periods. The time required to obtain approval in other countries might differ from and be longer than that required to obtain FDA approval. Regulatory approval in one country does not ensure regulatory approval in another, but a failure or delay in obtaining regulatory approval in one country may negatively impact the regulatory process in others.

Clinical Trial Approval in the EU. On January 31, 2022, the new Clinical Trials Regulation (EU) No 536/2014 became effective in the European Union and replaced the prior Clinical Trials Directive 2001/20/EC. The new regulation aims at simplifying and streamlining the authorization, conduct and transparency of clinical trials in the European Union. Under the new coordinated procedure for the approval of clinical trials, the sponsor of a clinical trial to be conducted in more than one Member State of the European Union, or EU Member State, will only be required to submit a single application for approval. The submission will be made through the Clinical Trials Information System, a new clinical trials portal overseen by the European Medicines Agency, or the EMA, and available to clinical trial sponsors, competent authorities of the EU Member States and the public.

The new regulation did not change the preexisting requirement that a sponsor must obtain prior approval from the competent national authority of the EU Member State in which the clinical trial is to be conducted. If the clinical trial is conducted in different EU Member States, the competent authorities in each of these EU Member States must provide their approval for the conduct of the clinical trial. Furthermore, the sponsor may only start a clinical trial at a specific study site after the applicable ethics committee has issued a favorable opinion. As in the United States, information about certain clinical trials must be submitted within specific timeframes to the European Union (EudraCT) website: https://eudract.ema.europa.eu/ and other countries.

Marketing Authorization. To obtain marketing approval of a drug under European Union regulatory systems, we may submit marketing authorization applications, or MAAs, either under a centralized or decentralized procedure. The centralized procedure provides for the grant of a single marketing authorization that is valid for all EU member states. The centralized procedure is compulsory for medicines produced by specified biotechnological processes, products designated as orphan medicinal products, and products with a new active substance indicated for the treatment of specified diseases, and optional for those products that are highly innovative or for which a centralized process is in the interest of patients. Under the centralized procedure in the European Union, the maximum

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timeframe for the evaluation of an MAA is 210 days, excluding clock stops, when additional written or oral information is to be provided by the applicant in response to questions asked by the Scientific Advice Working Party of the Committee of Medicinal Products for Human Use, or the CHMP. Accelerated evaluation might be granted by the CHMP in exceptional cases, when a medicinal product is expected to be of a major public health interest, defined by three cumulative criteria: the seriousness of the disease, such as heavy disabling or life-threatening diseases, to be treated; the absence or insufficiency of an appropriate alternative therapeutic approach; and anticipation of high therapeutic benefit. In this circumstance, the EMA ensures that the opinion of the CHMP is given within 150 days.

The decentralized procedure provides for approval by one or more other, or concerned, member states of an assessment of an application performed by one-member state, known as the reference member state. Under this procedure, an applicant submits an application, or dossier, and related materials, including a draft summary of product characteristics, and draft labeling and package leaflet, to the reference member state and concerned member states. The reference member state prepares a draft assessment and drafts of the related materials within 120 days after receipt of a valid application. Within 90 days of receiving the reference member state’s assessment report, each concerned member state must decide whether to approve the assessment report and related materials. If a member state cannot approve the assessment report and related materials on the grounds of potential serious risk to public health, the disputed points may eventually be referred to the European Commission, whose decision is binding on all member states. For the EMA, an agreed Pediatric Investigation Plan, which could include a request for waiver or deferral, is required prior to submitting an MAA for use for drugs in pediatric populations.

Priority Medicines, or PRIME, Drug Designation. The EMA may grant PRIME drug designation to medicine developers to treat an unmet medical need upon selection. Medicines eligible for PRIME must address an unmet medical need, have data available showing the potential to address this need and bring a major therapeutic advantage to patients. PRIME designation provides early and enhanced support from the EMA to optimize the development of eligible medicines, speeds up their evaluation, and contributes to timely patients’ access. Once a candidate is selected for PRIME designation, the EMA will provide scientific advice at key development milestones and confirm potential for accelerated assessment at the time of an application for marketing authorization. These medicines are considered priority medicines by the EMA.

Data and Market Exclusivity. In the European Union, new chemical entities qualify for eight years of data exclusivity upon marketing authorization and an additional two years of market exclusivity. This data exclusivity, if granted, prevents regulatory authorities in the European Union from assessing a generic (abbreviated) application for eight years, after which generic marketing authorization can be submitted but not approved for two years. The overall ten-year period will be extended to a maximum of eleven years if, during the first eight years of those ten years, the marketing authorization holder obtains an authorization for one or more new therapeutic indications which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit in comparison with existing therapies. Even if a compound is considered to be a new chemical entity and the sponsor is able to gain the prescribed period of data exclusivity, another company nevertheless could also market another version of the drug if such company can complete a full MAA with a complete human clinical trial database and obtain marketing approval of its product.

Orphan Drug Exclusivity. The EMA grants orphan drug designation to promote the development of products that may offer therapeutic benefits for life-threatening or chronically debilitating conditions affecting not more than five in 10,000 people in the European Union. In addition, orphan drug designation can be granted if the drug is intended for a life threatening, seriously debilitating or serious and chronic condition in the European Union and without incentives it is unlikely that sales of the drug in the European Union would be sufficient to justify developing the drug. Orphan drug designation is only available if there is no other satisfactory method approved in the European Union of diagnosing, preventing or treating the condition, or if such a method exists, the proposed orphan drug will be of significant benefit to patients. Orphan drug designation provides opportunities for free protocol assistance, fee reductions for access to the centralized regulatory procedures before and during the first year after marketing authorization and 10 years of market exclusivity of the designated indication following drug approval. Fee reductions are not limited to the first year after authorization for small and medium enterprises. The exclusivity period may be reduced to six years if the designation criteria are no longer met, including where it is shown that the product is sufficiently profitable not to justify maintenance of market exclusivity.

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Approval of Companion Diagnostic Devices. In the European Union, medical devices such as companion diagnostics must comply with the General Safety and Performance Requirements, or SPRs, detailed in Annex I of the EU Medical Devices Regulation (Regulation (EU) 2017/745), or MDR which came into force on May 26, 2021 and replaced the previously applicable EU Medical Devices Directive (Council Directive 93/42/EEC). Compliance with SPRs and additional requirements applicable to companion medical devices is a prerequisite to be able to affix the CE Mark of Conformity to medical devices, without which they cannot be marketed or sold. To demonstrate compliance with the SPRs, a manufacturer must undergo a conformity assessment procedure, which varies according to the type of medical device and its classification. The MDR is meant to establish a uniform, transparent, predictable, and sustainable regulatory framework across the EU for medical devices.

Separately, the regulatory authorities in the EU also adopted a new In Vitro Diagnostic Regulation, or IVDR, (EU) 2017/746, which will become effective in May 2022. The new regulation will replace the In Vitro Diagnostics Directive (IVDD) 98/79/EC. Manufacturers wishing to apply to a notified body for a conformity assessment of their in vitro diagnostic medical device have until May 2022 to update their Technical Documentation to meet the requirements and comply with the new, more stringent Regulation. Once applicable, the regulation will, among other things: strengthen the rules on placing devices on the market and reinforce surveillance once they are available; establish explicit provisions on manufacturers’ responsibilities for the follow-up of the quality, performance, and safety of devices placed on the market; improve the traceability of medical devices throughout the supply chain to the end-user or patient through a unique identification number; set up a central database to provide patients, healthcare professionals and the public with comprehensive information on products available in the European Union; and strengthen rules for the assessment of certain high-risk devices, such as implants, which may have to undergo an additional check by experts before they are placed on the market.

Reimbursement and Pricing of Prescription Pharmaceuticals. In the EU, similar political, economic and regulatory developments to those in the United States may affect our ability to profitably commercialize our product candidates, if approved. In markets outside of the U.S. and the EU, reimbursement and healthcare payment systems vary significantly by country and many countries have instituted price ceilings on specific products and therapies. In many countries, including those of the EU, the pricing of prescription pharmaceuticals is subject to governmental control and access. In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product. To obtain reimbursement or pricing approval in some countries, pharmaceutical firms may be required to conduct a clinical trial that compares the cost-effectiveness of the product to other available therapies.

General Data Protection Regulation. The collection, use, disclosure, transfer, or other processing of personal data regarding individuals in the EU, including personal health data, is subject to the EU General Data Protection Regulation, or GDPR, which became effective on May 25, 2018. The GDPR is wide-ranging in scope and imposes numerous requirements on companies that process personal data, including requirements relating to processing health and other sensitive data, obtaining consent of the individuals to whom the personal data relates, providing information to individuals regarding data processing activities, implementing safeguards to protect the security and confidentiality of personal data, providing notification of data breaches, and taking certain measures when engaging third-party processors.

The GDPR also imposes strict rules on the transfer of personal data to countries outside the EU, including the United States and permits data protection authorities to impose large penalties for violations of the GDPR, including potential fines of up to €20 million or 4% of annual global revenues, whichever is greater. The GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR. Compliance with the GDPR will be a rigorous and time-intensive process that may increase the cost of doing business or require companies to change their business practices to ensure full compliance.

Compliance with the GDPR is a rigorous and time-intensive process that may increase the cost of doing business or require companies to change their business practices to ensure full compliance. In July 2020, the Court of Justice of the European Union, or the CJEU, invalidated the EU-U.S. Privacy Shield framework, one of the mechanisms used to legitimize the transfer of personal data from the EEA to the United States. The CJEU decision also drew into question the long-term viability of an alternative means of data transfer, the standard contractual clauses, for transfers of personal data from the EEA to the United States.

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Brexit and the Regulatory Framework in the United Kingdom.

The United Kingdom’s withdrawal from the EU took place on January 31, 2020. The EU and the U.K. reached an agreement on their new partnership in the Trade and Cooperation Agreement, or the Brexit Agreement, which was applied provisionally beginning on January 1, 2021 and which entered into force on May 1, 2021. The Brexit Agreement focuses primarily on free trade by ensuring no tariffs or quotas on trade in goods, including healthcare products such as medicinal products. Thereafter, the EU and the U.K. will form two separate markets governed by two distinct regulatory and legal regimes. As such, the Brexit Agreement seeks to minimize barriers to trade in goods while accepting that border checks will become inevitable as a consequence that the U.K. is no longer part of the single market. As of January 1, 2021, the Medicines and Healthcare products Regulatory Agency, or the MHRA, became responsible for supervising medicines and medical devices in Great Britain, comprising England, Scotland and Wales under domestic law whereas Northern Ireland continues to be subject to EU rules under the Northern Ireland Protocol. The MHRA will rely on the Human Medicines Regulations 2012 (SI 2012/1916) (as amended), or the HMR, as the basis for regulating medicines. The HMR has incorporated into the domestic law the body of EU law instruments governing medicinal products that pre-existed prior to the U.K.’s withdrawal from the EU.

Furthermore, while the Data Protection Act of 2018 in the United Kingdom that “implements” and complements the European Union’s General Data Protection Regulation, or GDPR, has achieved Royal Assent on May 23, 2018 and is now effective in the United Kingdom, it is still unclear whether transfer of data from the European Economic Area, or EEA, to the United Kingdom will remain lawful under GDPR. The Brexit Agreement provides for a transitional period during which the United Kingdom will be treated like an European Union member state in relation to processing and transfers of personal data for four months from January 1, 2021. This may be extended by two further months. After such period, the United Kingdom will be a “third country” under the GDPR unless the European Commission adopts an adequacy decision in respect of transfers of personal data to the United Kingdom. The United Kingdom has already determined that it considers all of the EU 27 and EEA member states to be adequate for the purposes of data protection, ensuring that data flows from the United Kingdom to the EU/EEA remain unaffected.

Employees and Human Capital Resources

As of March 1, 2022, we had approximately 250 full-time and part-time employees. After taking into account the cross-functional headcount reduction announced on March 1, 2022, we expect that we will have approximately 215 full-time and part-time employees, approximately 95 of whom will be primarily engaged in research and development activities. To provide us with flexibility in meeting varying workflow demands, we also engage temporary workers and consultants when needed.

Our human capital is integral in helping us achieve our mission to rewrite treatment for cancer through novel epigenetic medicines. We believe that we have built a culture of community, along with our EpiExcellence cultural attributes, and many of these qualities are foundational. ​Our EpiExcellence cultural attributes include:

•Camaraderie: connectedness, humor, liking each other, fun, in it together, mutual respect

•Collaboration: integrated decision-making, teamwork, internal/external partnerships, interdependent, “right people, right time, right involvement”

•Discipline: execution, prioritization, focus, accountability, consistency, quality

•Innovation: risk-tolerant, creativity, evidence-based, curiosity, continuous learning

•Openness: honesty, constructive dissent, transparency, courageous conversations, assumption of good intent, trust

•Patient-focus: shared purpose, inspired, passionate, motivated, sense of urgency

•Resilience: nimble, optimistic, embracing change, evolutionary, adaptable

We have been intentional in ensuring that we are creating a culture and company that offers a vibrant community to our employees where we can fully be ourselves at work. We strive to ensure that Epizyme is a place where all

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people experience equality, where we value diversity in all its forms, and that we are modeling these behaviors in the world outside Epizyme as corporate citizens.

Information about our Executive Officers

The following table sets forth the name, age and position of each of our executive officers as of February 25, 2022.

Name	Age	Position
Grant Bogle	64	President, Chief Executive Officer and Director
Shefali Agarwal	48	Executive Vice President, Chief Medical and Development Officer
Jeffery L. Kutok	55	Chief Scientific Officer

Grant Bogle has served as a director since September 2019 and our President and Chief Executive Officer since August 2021. Mr. Bogle served as Senior Vice President and Chief Commercial Officer for Tesaro, Inc, a biopharmaceutical company, or Tesaro, from July 2015 to June 2019. Prior to joining Tesaro, Mr. Bogle served as Senior Vice President, Pharmaceutical and Biotech Solutions at McKesson Specialty Health (formerly U.S. Oncology) from July 2007 to June 2015. Previously, he was Senior Vice President of Sales and Marketing for Millennium Pharmaceuticals. Mr. Bogle holds a B.A. in economics from Dartmouth College, an M.B.A. from Columbia University and is a Senior Fellow of the Advanced Leadership Initiative at Harvard University.

Dr. Shefali Agarwal has served as our Executive Vice President, Chief Medical and Development Officer since February 2021 and served as our Chief Medical Officer from June 2018 to February 2021. Prior to joining us, Dr. Agarwal held leadership positions across medical research, clinical development, clinical operations and medical affairs. She most recently served as chief medical officer at SQZ Biotech, a biotechnology company developing cell therapies for patients with a wide range of diseases, from July 2017 to May 2018 and as a non-executive advisor from May 2018 to July 2018, where she built and led the clinical development organization, which included clinical research operations and the regulatory function. Before SQZ Biotech, Dr. Agarwal also held leadership positions at Curis, Inc. a biotechnology company developing therapeutics for the treatment of cancer, from July 2016 to July 2017 and Tesaro from July 2013 to July 2017. Dr. Agarwal also held positions of increasing responsibility at AVEO Pharmaceuticals, Inc., a biopharmaceutical company, from December 2011 to July 2013, Covidien, a medical devices and health care products company, from April 2010 to December 2011, and Pfizer Inc., a pharmaceutical company with a wide range of treatments, from June 2005 to April 2010. She has served as a member of the board of directors of Gritstone bio, Inc., a publicly traded clinical-stage biotechnology company, since June 2021; Fate Therapeutics, Inc., a publicly traded clinical-stage biopharmaceutical company, since July 2019; and Onxeo SA, a publicly traded clinical-stage biopharmaceutical company, since April 2021. Dr. Agarwal received her MBBS medical degree from Karnataka University’s Mahadevappa Rampure Medical School in India, Master’s Degree in Public Health from Johns Hopkins University, where she led clinical research in the Department of Anesthesiology and Critical Care Medicine, and a Master of Science degree in Business from the University of Baltimore’s Merrick School of Business.

Jeffery L. Kutok, M.D., Ph.D., has served as our Chief Scientific Officer since joining us in April 2020. Dr. Kutok previously served as Chief Scientific Officer of Infinity Pharmaceuticals, Inc., or Infinity, a biotechnology company that develops cancer medication, from February 2017 to March 2020. Dr. Kutok previously served as Infinity’s Vice President of Biology and Translational Science from August 2013 to February 2017, and in other roles with increasing responsibility from January 2011 to August 2013. Prior to joining Infinity, Dr. Kutok was an associate professor of pathology at Harvard Medical School and Brigham and Women’s Hospital. Dr. Kutok’s laboratory focused on translational medicine research and biomarker identification in cancer, and he is an author on over 200 journal articles, reviews and book chapters. Dr. Kutok is board certified in Anatomic Pathology and Hematology and had clinical duties in Hematopathology and Molecular Diagnostics at Brigham and Women’s Hospital. Dr. Kutok received his B.S. in biology and his M.D., Ph.D. in medicine and molecular pathology from the State University of New York at Stony Brook. He was also a post-doctoral fellow at Harvard University in the laboratory of Dr. Gary Gilliland, M.D., Ph.D.

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Our Corporate Information

We were incorporated under the laws of the state of Delaware on November 1, 2007 under the name Epizyme, Inc. Our principal executive offices are located at 400 Technology Square, 4th Floor, Cambridge, Massachusetts 02139. Our telephone number is (617) 229-5872, and our website is located at www.epizyme.com. References to our website are inactive textual references only and the content of our website should not be deemed incorporated by reference into this Annual Report on Form 10-K.

Available Information

Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, are available free of charge on our website located at www.epizyme.com as soon as reasonably practicable after they are electronically filed with or furnished to the SEC. These reports are also available at the SEC’s Internet website at www.sec.gov.

A copy of our Corporate Governance Guidelines, Code of Business Conduct and Ethics and the charters of the Audit Committee, Organizational Health and Compensation Committee, and Nominating and Corporate Governance Committee are posted on our website, www.epizyme.com, under “Investors & Media” and are available in print to any person who requests copies by contacting Epizyme by calling (617) 229-5872 or by writing to Epizyme, Inc., 400 Technology Square, 4th Floor, Cambridge, Massachusetts 02139.

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Item 1A. Risk Factors

Risk Factors

Careful consideration should be given to the following risk factors, in addition to the other information set forth in this Annual Report on Form 10-K and in other documents that we file with the SEC, in evaluating our company and our business. Investing in our common stock involves a high degree of risk. If any of the following risks and uncertainties actually occurs, our business, prospects, financial condition and results of operations could be materially and adversely affected. The risks described below are not intended to be exhaustive and are not the only risks facing our company. New risk factors can emerge from time to time, and it is not possible to predict the impact that any factor or combination of factors may have on our business, prospects, financial condition and results of operations.

In addition, the COVID-19 pandemic has impacted, continues to impact and in the future may exacerbate or further impact risks discussed in this Annual Report on Form 10-K, any of which could have a material effect on us. This situation is changing rapidly and additional impacts may arise.

Risks Related to Product Development and Commercialization

We are dependent on the successful development and commercialization of tazemetostat. If we do not successfully commercialize TAZVERIK for the indications for which TAZVERIK is approved or are unable to develop, obtain marketing approval of, and commercialize tazemetostat for additional indications, either alone or through a collaboration, or if we experience significant delays in doing so, our business could be harmed.

Our EZH2 inhibitor, TAZVERIK, is approved in the United States for the treatment of epithelioid sarcoma, or ES, and for follicular lymphoma, or FL. We have no other products approved for sale. We are investing a significant portion of our efforts and financial resources to fund the development and commercialization of tazemetostat. Commercial sales of TAZVERIK for the treatment of ES commenced in the first quarter of 2020 and commercial sales of TAZVERIK for the treatment of FL commenced near the end of the second quarter of 2020.

In connection with the accelerated approval of our ES new drug application, or NDA and our FL supplemental NDA, or sNDA, continued approval is contingent upon verification and description of clinical benefit in a confirmatory program in each indication. We are conducting Phase 1b/3 trials to assess TAZVERIK in combination with doxorubicin compared with doxorubicin plus placebo as a front-line treatment for ES and to evaluate the combination of TAZVERIK with “R2” (Revlimid plus rituximab), an approved chemotherapy-free treatment regimen, for FL patients in the second-line or later treatment setting. These trials are expensive and time-consuming and may not confirm such benefit and subject the NDAs to withdrawal. If a confirmatory program does not verify clinical benefit for an indication, we may have to withdraw our accelerated approval for that indication. If any of these outcomes occurs, either to TAZVERIK or to any future product candidate for which we may seek marketing approval, we may be forced to abandon our development efforts for tazemetostat or such future product candidates, which could significantly harm our business.

We and our collaborators are conducting clinical trials of tazemetostat in other indications and in combination with other products. Our EZM0414 product candidate is in early clinical development and all of our product candidates are still in preclinical development. As a result, our prospects are substantially dependent on our ability, or the ability of any future collaborator, to successfully commercialize tazemetostat for ES and FL in the approved indications and to develop, obtain marketing approval for and successfully commercialize tazemetostat in one or more additional disease indications.

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The success of tazemetostat will depend on several factors, including the following:

•success of the ongoing commercialization of TAZVERIK for ES and FL in the approved indications, whether alone or in combination with other products;

•successful confirmatory trials of TAZVERIK in the approved indications that are satisfactory to the FDA and maintenance of the continued acceptable safety profiles of the products following approval;

•continued implementation and maintenance of effective sales, marketing and distribution capabilities and strategies for commercialization of TAZVERIK;

•acceptance of TAZVERIK for ES, FL, and any other indication for which it may be approved by physicians, patients, third-party payors and others in the medical community;

•timely submission of a marketing authorization application to and timely receipt of marketing approval from the European Medicines Agency, or EMA, for ES, FL or any future indications;

•the extent of any required post-marketing approval commitments to applicable regulatory authorities;

•successful enrollment in and completion of clinical trials for the treatment of additional indications;

•safety, tolerability and efficacy profiles that are satisfactory to the FDA, the EMA, or any comparable foreign regulatory authority for marketing approval for additional indications and maintenance of continued acceptable safety profile following approval;

•effectively competing with other therapies;

•obtaining and maintaining healthcare insurance coverage and adequate reimbursement;

•making arrangements with third-party manufacturers for, or establishing, clinical and commercial manufacturing capabilities;

•obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our products and product candidates;

•protecting our rights in our intellectual property portfolio; and

•effectively and successfully navigating the commercial and operational challenges and impacts resulting from the COVID-19 pandemic.

Many of these factors are beyond our control, including clinical development, the regulatory review process, potential threats to our intellectual property rights and the manufacturing, marketing and sales efforts of any collaborator. If any of these factors adversely affects the development or commercialization of tazemetostat, we may not be able to successfully develop or commercialize tazemetostat on a timely basis or at all, which would materially harm our business.

The COVID-19 pandemic has impacted and may continue to impact our commercial launch efforts for TAZVERIK in FL and ES and has led to some delays in clinical trial startup, and may affect our ability to initiate and complete preclinical studies and our ongoing and planned clinical trials, disrupt regulatory activities, further disrupt commercialization of TAZVERIK, or have other adverse effects on our business and operations. In addition, the COVID-19 pandemic has caused substantial disruption in the global financial markets, global supply chains and may adversely impact economies worldwide, which could result in adverse effects on our business and operations.

The COVID-19 pandemic, which began in late 2019 and has spread worldwide, is causing many governments to implement measures intended to slow the spread of the outbreak through quarantines, travel restrictions, heightened border scrutiny, and other measures. The outbreak and government measures taken in response have also had a significant impact, both direct and indirect, on businesses and commerce, as worker shortages have occurred; supply chains have been disrupted; facilities have been disrupted and production has been suspended; and demand for certain goods and services, such as medical services and supplies, has spiked, while demand for other goods and services, such as travel, has fallen. The future progression of the outbreak and its effects on our business and operations are uncertain.

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We and our contract manufacturing organizations, or CMOs, and contract research organizations, or CROs, may face disruptions that may affect our ability to initiate and conduct preclinical studies and our planned and ongoing clinical trials, including disruptions in procuring items that are essential for our research and development activities, such as access to raw materials used in the manufacture of tazemetostat, EZM0414 and/or our future product candidates, laboratory supplies used in our preclinical studies and ongoing clinical trials, or animals that are used for preclinical testing for which there are shortages because of ongoing efforts to address the outbreak, and resulting disruptions to many global supply chains. We and our CROs and CMOs, as well as clinical trial sites, may face disruptions related to the conduct of our ongoing clinical trials, planned clinical trials or future clinical trials arising from manufacturing disruptions, staffing disruptions and limitations in regard to our internal activities and the activities of our CROs and CMOs, and delays in the ability to obtain necessary institutional review board or other necessary site approvals or delays in site initiations or site monitoring visits, as well as other delays at clinical trial sites. We may also face limitations on enrollment and patients withdrawing from our clinical trials or not complying with the protocol procedures, which could delay completion of our clinical trials or adversely affect the data generated by our clinical trials. For example, we have experienced some delays in clinical trial startup activities due to what we believe to be mostly related to COVID-19 related capacity constraints and resulting delays in the packaging and labeling of clinical drug supply at a third-party manufacturer. The response to the COVID-19 pandemic may redirect resources with respect to regulatory and intellectual property matters in a way that could adversely impact our ability to progress regulatory approvals and protect our intellectual property. In addition, we may face impediments to regulatory meetings and approvals due to measures intended to limit in-person interactions.

We commenced commercial sales of TAZVERIK in January 2020, and the pandemic and related government imposed measures have limited our ability to readily access accounts and healthcare professionals, in person or at all, to provide medical information in support of TAZVERIK utilization. For example, the COVID-19 pandemic has negatively impacted ES and FL patient visits to physicians, new patient starts across all lines of treatment as well as the ability of our field-based teams to fully access ES and FL prescribers. While our field-based teams continue to use virtual formats as well as in-person interactions, where possible, to allow us to serve the needs of healthcare providers, patients and other stakeholders, access to prescribers remains restrictive, and we expect these challenges to continue through the first half of 2022. Additionally, we expect that some of these challenges posed by some of the changes brought about by the COVID-19 pandemic, such as ongoing restrictions to access prescribers by traditional sales personnel, will likely persist even after the resolution of the pandemic. The pandemic has significantly impacted economies worldwide, which could result in adverse effects on our business and operations. Moreover, the pandemic has caused substantial disruption in the global financial markets and supply chains and may continue to adversely impact economies worldwide, which could result in adverse effects on our business and operations as well as the volatility of our stock price and trading in our stock.

We are implementing a multi-stage return to office plan based on guidance from federal, state and local government authorities, and in October 2021 we opened our facilities to all employees who expressed interest in participating in a return-to-office pilot program. In the meantime, many of our employees continue to work in a remote operating model. Our laboratory scientists who engage in bench research activities now have full access to our laboratories. We are using our pilot program to further evaluate this hybrid model and will use that evaluation to formulate how we will move forward. We expect that some form of a hybrid model will continue to exist for us in the future. Changes in guidance from federal, state and local government authorities could impact our return to office plan, and require us to increasingly rely on personnel working remotely. For example, changes to guidance from federal, state and local government authorities to restrict or limit in-person interactions could result in our laboratory staff that is presently engaged in research and development activities to have restricted access to laboratories. Such restricted access could delay timely completion of preclinical activities and the initiation of additional clinical trials for other of our development programs.

A remote or hybrid operating model may negatively impact productivity, or disrupt, delay, or otherwise adversely impact our business. In addition, this could increase our cyber security risk, create data accessibility concerns, and make us more susceptible to communication disruptions, any of which could adversely impact our business

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operations or delay necessary interactions with state, local and federal regulators, ethics committees, manufacturing sites, research or clinical trial sites and other important agencies and contractors, including our CROs and CMOs.

Due to the evolving and uncertain global impacts of the COVID-19 pandemic, we cannot precisely determine or quantify the impact that the COVID-19 pandemic has had or will have on our business, financial condition, results of operations, and prospects for the fiscal year ending December 31, 2022 and beyond.

Tazemetostat, EZM0414 or any other product candidate that we develop 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.

Tazemetostat, EZM0414 or any other product candidates that we develop may fail to gain sufficient market acceptance by physicians, patients, third-party payors and others in the medical community. If tazemetostat, EZM0414 or any other such product candidate that we develop does not achieve an adequate level of acceptance, we may not generate significant product revenues and we may not become profitable. The degree of market acceptance of tazemetostat, EZM0414 or any other product candidates that we develop will depend on a number of factors, including:

•the efficacy 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;

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

•the strength of marketing and distribution support;

•the availability of third-party coverage and adequate reimbursement;

•the prevalence and severity of any side effects;

•any safety events that may have occurred in connection with the development of the product candidate; and

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

In addition, the potential market opportunity for tazemetostat is difficult to precisely estimate. Our estimates of the potential market opportunity for tazemetostat include several key assumptions based on our industry knowledge, industry publications, third-party research reports and other surveys. While we believe that our internal assumptions are reasonable, no independent source has verified such assumptions. If any of these assumptions proves to be inaccurate, then the actual market for tazemetostat could be smaller than our estimates of our potential market opportunity. If the actual market for tazemetostat, EZM0414 or any other product candidate is smaller than we expect, our product revenue may be limited and it may be more difficult for us to achieve or maintain profitability.

If we are unable to maintain effective sales, marketing and distribution capabilities, we may not be successful in commercializing tazemetostat or any other product candidates that we may develop if and when such product candidate is approved.

To achieve commercial success for any product for which we obtain marketing approval, we will need to maintain an effective sales and marketing organization.

We have established, and plan to continue to build and refine, the infrastructure that we believe is necessary and appropriate to support the ongoing commercialization and marketing of TAZVERIK for the approved indications in the United States and the successful commercial launch and marketing of tazemetostat for other indications and in other jurisdictions and of other product candidates and future product candidates that may receive marketing approval. There are risks involved with maintaining our own sales, marketing and distribution capabilities. For example, recruiting, training and retaining a sales force is expensive and time consuming and any failure to do so successfully could negatively affect sales or any commercial launch of a product. 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

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for any reason, we would have prematurely or unnecessarily incurred these commercialization expenses. These efforts 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 successfully commercialize 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 or persuade adequate numbers of physicians to prescribe any current or future products;

•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.

If we are unable to effectively maintain our own sales, marketing and distribution capabilities and as a result we determine to enter into arrangements with third parties to perform these services, our product revenues and our profitability, if any, could be lower than if we were to market, sell and distribute any products that we develop ourselves. In addition, we may determine to seek to enter into arrangements with third parties to perform these services in certain geographies outside the United States or for additional indications. However, we may not be successful in entering into arrangements with third parties to sell, market and distribute TAZVERIK or any current or future product candidates or may be unable to do so on terms that are acceptable 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, market or distribute our products effectively. If we do not establish and maximize sales, marketing and distribution capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing TAZVERIK or any current or future product candidates.

Our changes to our commercial strategy and organization, adjustments to our operating plans, including operating expense reductions, prioritization of development activities and leadership transitions may not be successful, may not result in accelerated commercial adoption of TAZVERIK and greater product revenues or anticipated savings, could result in total costs and expenses that are greater than expected, could result in us forgoing business opportunities and could disrupt our business.

In August 2021, we announced changes to our leadership team with the resignation of our President and Chief Executive Officer, Robert Bazemore, and the appointment of Grant Bogle, a member of our board of directors since September 2019, as President and Chief Executive Officer, each effective as of August 9, 2021. In addition, in August 2021, we made the decision to eliminate the Chief Commercial Officer position, effective at the end of October 2021, and in October 2021 we announced the elimination of the role and departure of our now-former Executive Vice President, Chief Strategy and Business Officer.

In addition, in August 2021, we announced changes to our commercial strategy and organization in an effort to accelerate commercial adoption of TAZVERIK as well as a broader operational cost reduction plan. As part of our cost reduction plan, we implemented a cross-functional reduction of approximately 11% of our then-current workforce.

In March 2022, we announced the implementation of a further reduction of operating expenses, including additional workforce reductions and changes to our broader organization, as well as the re-prioritization of our pipeline and investment of company resources. We further reduced our workforce by approximately 12% of our then-current employees under these March 2022 expense reductions. We plan to continue to implement our broader operational expense reduction effort, and to monitor and seek opportunities to further reduce our operating expenses.

We may not realize, in full or in part, the anticipated benefits, savings and improvements from these changes or from any future changes we may decide to make. For instance, the changes to our commercial strategy and organization may not result in accelerated commercial adoption of TAZVERIK or greater product revenues. We believe that the commercial launch has been adversely affected by the COVID-19 pandemic and may continue to be

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adversely affected by the pandemic. In addition, market acceptance of TAZVERIK and product revenues have been adversely impacted by other factors, including competitive therapies and the use of our patient assistance program, which our changes may not address. The reduction in the size of our field organization and the prior departure of our Chief Commercial Officer may also limit the success of our refined strategy.

Our organizational changes, operating plan adjustments and operating expense reductions also may not be successful. If we are unable to realize the expected operational efficiencies and cost savings from these changes, our operating results and financial condition would be adversely affected. We also cannot ensure that we will not have to undertake additional workforce reductions or other cost-cutting measures in the future. Furthermore, these changes as well as the leadership transitions, pipeline reprioritization, and any future additional workforce reductions or other cost-cutting measures may be disruptive to our operations. For example, our workforce reductions, leadership changes and pipeline reprioritization could yield unanticipated consequences, such as attrition beyond planned staff reductions and negative impact on employee morale or could make it more difficult to fulfill our day-to-day operations. Our workforce reductions, leadership changes and pipeline reprioritization could also harm our ability to attract and retain qualified management, scientific, clinical, manufacturing and sales and marketing personnel who are critical to our business. In 2021, our annualized turnover rate was higher than in prior years and these changes could further or exacerbate that trend. Any failure to attract or retain qualified personnel could prevent us from successfully commercializing TAZVERIK, developing tazemetostat and discovering and developing EZM0414 and any future product candidates.

We face substantial competition, which may result in others discovering, developing or commercializing products before or more successfully than we do.

The development and commercialization of new drug products is highly competitive. We face competition with respect to tazemetostat, and will likely face competition with respect to our EZM0414 product candidate or any other product candidates that we may seek to develop or commercialize in the future, from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide. There are a number of large pharmaceutical and biotechnology companies that currently market and sell products or are pursuing the development of products for the treatment of many of the indications for which we are selling TAZVERIK and for which we are developing tazemetostat. Some of these competitive products and therapies are based on scientific approaches that are the same as or similar to our approach, and others are based on entirely different approaches. Potential competitors also include academic institutions, government agencies and other public and private research organizations that conduct research, seek patent protection and establish collaborative arrangements for research, development, manufacturing and commercialization of pharmaceutical products that may compete with our products or product candidates. Tazemetostat, EZM0414 and any future product candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

In the relapsed and refractory FL patient setting, both current and near-term competition for tazemetostat exists. The most common current treatments for FL are chemotherapies, usually combined with the CD-20 antibodies Rituxan or Gazyva. Multiple PI3K therapies, such as copanlisib (ALIQOPA) and umbralisib (UKONIQ) are approved for patients with relapsed/refractory FL. These therapies are utilized predominantly in the third line or later treatment. Recently, two companies have announced that there have been voluntary withdrawals of accelerated approvals for FL indications for two PI3K inhibitors, idelalisib (ZYDELIG) and duvelisib (COPIKTRA) in the U.S. market. Additionally, parsaclisib’s NDA has been voluntarily withdrawn for the treatment of patients with relapsed/refractory FL. The CAR-T therapy YESCARTA is also approved for the treatment of patients with relapsed/refractory FL. While CD20, PI3K and CAR-T therapies are approved in FL, there are no therapies that are approved specifically for the treatment of tumors associated with EZH2 activating mutations. There are a number of companies currently evaluating investigational agents in the relapsed and refractory follicular lymphoma patient setting including the development of additional PI3K inhibitors, CAR-T therapies and bispecific monoclonal antibodies. Zandelisib is in development by MEI Pharma for FL patients that are refractory to treatment or relapsed after two prior lines of therapy. Novartis is also developing its CAR-T therapy, KYMRIAH, for the treatment of relapsed or refractory FL patients and is undergoing priority review by the FDA. The EMA also accepted Novartis’ Type II Variation for KYMRIAH in adult patients with relapsed or refractory FL after two prior lines of treatment in the third quarter of 2021. The bispecific antibody furthest along in development in relapsed or refractory FL is Roche’s CD3/CD20 bispecific mosunetuzumab.

In the ES patient setting, there are no therapies approved specifically for epithelioid sarcoma, other than TAZVERIK. Most of the approved therapies utilized in ES are more broadly approved for soft tissue sarcoma in

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general. Furthermore, the only therapies in late stage clinical trials are being developed for the treatment of soft tissue sarcoma as well.

In the multiple myeloma patient setting, the most common treatments, which compete with EZM0414, include IMiD (include Revlimid (lenalidomide), Pomalyst (pomalidomide), and Thalidomide (thalomid)), proteasome inhibitors (including Velcade (bortezomib), Kyprolis (xarfilzomib), and Ninlaro (ixazomib)), and anti-CD38 mAb (including Darzalex (daratumumab) and Sarclisa (isatuximab-irfc)) combinations. Current therapies for the relapsed or refractory population also include BCMA targeting CAR-Ts and ADCs. The multiple myeloma pipeline is robust, and includes BCMA CAR-T therapies, bispecific antibodies, BiTEs, and CELMoDs. Additionally, there are assets in development for high risk MM and the t(4;14) subpopulation, including K36’s MMSET inhibitor KTX-1001.

For DLBCL, the most common treatments are chemotherapies, often in combination with the monoclonal antibody Rituxan (rituximab) as well as autologous stem cell transplants. In the relapsed or refractory patient setting, current therapies include CAR-T therapies (Kymriah (tisagenlecleucel), Yescarta (axicabtagene ciloleucel), Breyanzi (lisocabtagene maraleucel)), a CD19 mAb (Monjuvi (tafasitamab)), and ADCs (Policy (polatuzumab vedotin) and Zynlonta (loncastuximab tesirine)). DLBCL pipeline therapies include bispecific antibodies, ADCs, and CAR-T therapies.

While there are many assets in development for both multiple myeloma and DLBCL including those with novel mechanisms of action, other than our EZM0414 product candidate which is in early clinical development, there are no therapies in clinical development that are SETD2 inhibitors.

There are a large number of companies developing or marketing treatments for cancer, including many major pharmaceutical and biotechnology companies. Companies that are developing new epigenetic treatments for cancer that target histone methyltransferases, or HMTs, and protein arginine methyltransferases, or PRMTs, include GlaxoSmithKline plc, or GSK, Johnson & Johnson, Pfizer, Inc., Daiichi Sankyo Company Limited, and Constellation Pharmaceuticals. Further, companies which are known to have EZH2 inhibitor programs or related programs include: Constellation Pharmaceuticals, developing an EZH2 inhibitor (CPI-0209, Phase 1/2 for solid tumors and lymphomas including DLBCL); Novartis AG, developing an EED inhibitor which indirectly blocks EZH2 (MAK683, Phase 1/2, advanced malignancies); Daiichi Sankyo, developing a EZH1/EZH2 dual inhibitor (valemetostat, DS-3201, Phase 1, relapsed or refractory non-Hodgkin lymphomas, AML, ALL as well as Phase 2 for small cell lung cancer); Pfizer, developing an EZH2 inhibitor (PF-06821497, Phase 1, relapsed or refractory small cell lung cancer, castration-resistant prostate cancer and FL); and Jiangsu Hengrui Pharmaceutical, developing an EZH2 inhibitor (SHR2554, Phase 2 for B-cell malignancies) in China. In addition, many companies are developing cancer therapeutics that work by targeting epigenetic mechanisms other than HMTs, including Celgene Corporation (now part of Bristol-Myers Squibb), or Celgene, Merck & Co., Inc., Secura Bio, Spectrum Pharmaceuticals, Otsuka Pharmaceuticals Co., Ltd, Foghorn Therapeutics, Forma Therapeutics and CellCentric, which are marketing cancer treatments that work by targeting epigenetic mechanisms other than HMTs.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than tazemetostat for ES, FL or any other indication for which we may develop tazemetostat or any other products 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 tazemetostat for any future indication for which we may develop tazemetostat or any other product we may develop, which could result in our competitors establishing a strong market position before we are able to enter the market. In addition, our ability to compete may be affected in many cases by insurers or other third-party payors seeking to encourage the use of generic products. Generic products are currently on the market for many of the indications that we are pursuing, and additional products are expected to become available on a generic basis over the coming years. We expect that tazemetostat will continue to be priced at a significant premium over competitive generic products.

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 and other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties compete with us in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.

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Tazemetostat, EZM0414 and any other future product candidate that we commercialize may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives, which could harm our business.

The regulations that govern marketing approvals, pricing, coverage and reimbursement for new drug products vary widely from country to country. Current and future legislation may significantly change the approval requirements in ways that could involve additional costs and cause delays in obtaining approvals. Some countries require approval of the sale price of a drug before it can be marketed. In many countries, the pricing review period begins after marketing or product licensing approval is granted. In some foreign markets, prescription pharmaceutical pricing remains subject to continuing governmental control even after initial approval is granted. As a result, we might obtain marketing approval for a product in a particular country, but then be subject to price regulations that delay our commercial launch and market acceptance of the product, possibly for lengthy time periods, and negatively impact the revenues we are able to generate from the sale of the product in that country. Adverse pricing limitations may hinder our ability to recoup our investment in one or more product candidates, even if our product candidates obtain marketing approval.

Our ability to successfully commercialize tazemetostat, EZM0414 or any future product candidates that we develop successfully also will depend in part on the extent to which insurance coverage and adequate reimbursement for these products and related treatments will be available from government health administration authorities, private health insurers and other organizations. Government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which medications they will pay for and establish corresponding reimbursement levels. A significant trend in the U.S. healthcare industry and elsewhere is cost containment. Government authorities and third-party payors continue to attempt to control costs by limiting coverage and the amount of reimbursement for particular medications. Increasingly, third-party payors are requiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products. Coverage and reimbursement may not be available for any product that we commercialize and, even if these are available, the level of reimbursement may not be satisfactory to recoup our investment. Reimbursement may affect the demand for, or the price of, any product candidate for which we obtain marketing approval. Obtaining and maintaining adequate reimbursement for our products may be difficult. We may be required to conduct expensive pharmacoeconomic studies to justify coverage and reimbursement or the level of reimbursement relative to other therapies. If coverage and adequate reimbursement are not available or reimbursement is available only to limited levels, we may not be able to successfully commercialize any product candidate for which we obtain marketing approval.

There may be significant delays in obtaining reimbursement for newly approved drugs, and coverage may be more limited than the purposes for which the drug is approved by the FDA or similar regulatory authorities outside of the United States. Moreover, eligibility for reimbursement does not imply that a drug will be paid for in all cases or at a rate that covers our costs, including research, development, manufacture, sale and distribution. Interim reimbursement levels for new drugs, if applicable, may also not be sufficient to cover our costs and may not be made permanent. Reimbursement rates may vary according to the intended use of the drug and the clinical setting in which it is used, may be based on reimbursement levels already set for lower cost drugs and may be incorporated into existing payments for other services. Net prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the United States. Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement policies. Our inability to promptly obtain coverage and adequate reimbursement rates from both government-funded and private payors for any approved products that we develop could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize products and our overall financial condition.

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Clinical drug development is a lengthy and expensive process, with an uncertain outcome. We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of tazemetostat, EZM0414 and any future product candidates.

We are conducting multiple clinical trials of tazemetostat. In addition, we have initiated a first-in-human study of EZM0414 for the treatment of adult patients with relapsed or refractory multiple myeloma or relapsed or refractory DLBCL. The risk of failure is high. It is impossible to predict when or if any product candidates that we may develop 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, manufacture, and then conduct extensive clinical trials to demonstrate the safety and efficacy of any product candidates in humans.

Product candidates are subject to preclinical safety studies, which may be conducted prior to or concurrently with clinical testing, as well as continued clinical safety assessment throughout clinical testing. The outcomes of these safety studies or assessments may delay the launch of or patient enrollment in clinical studies. For example, in the course of our preclinical safety studies of tazemetostat, we observed the development of lymphoma in Sprague-Dawley rats. As a result of these findings, coupled with our limited clinical experience in FL, at the time of the Investigational New Drug Application submission in December 2015, we were unable to conduct our Phase 2 trial of tazemetostat in FL patients in the United States until the beginning of 2017. In addition, in the second quarter of 2018, following a safety report of a pediatric patient who developed a secondary T-cell lymphoma in our ongoing Phase 1 clinical trial of tazemetostat in pediatric patients, the FDA, the French National Agency for Medicines and Health Products Safety and Germany’s Federal Institute for Drugs and Medical Devices each placed a partial clinical hold on new patient enrollment in our ongoing clinical trials of tazemetostat. That partial clinical hold was lifted in September 2018 by the FDA, in November 2018 by Germany’s Federal Institute for Drugs and Medical Devices, and in January 2019 by the French National Agency for Medicines and Health Products Safety. In pharmaceutical development, many compounds that initially show promise in early-stage testing for treating cancer are later found to cause side effects that prevent further development of the compound. If we or our collaborators are unable to fully and adequately address matters such as these when they arise, we may be unable to conduct clinical trials of tazemetostat, EZM0414 or any future product candidates, our trials may be limited to certain patient populations or our ability to conduct other trials in the United States or in other countries may be delayed.

Clinical testing is expensive, difficult to design and implement, can take many years to complete and is uncertain as to outcome. A failure of one or more clinical trials can occur at any stage of testing. The outcome of preclinical testing and early clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results. 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 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 tazemetostat, EZM0414 or any future 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;

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

•preclinical testing may produce results based on which we may decide, or regulators may require us, to conduct additional preclinical studies before we proceed with certain clinical trials, limit the scope of our clinical trials, halt ongoing clinical trials or abandon product development programs;

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•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 patients may drop out of these clinical trials at a higher rate than we anticipate;

•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;

•we may have to limit the scope of, suspend or terminate clinical trials of our product candidates for various reasons, including as a result of a finding that the patients are being exposed to unacceptable health risks;

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

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

•the supply or quality of our product candidates or other materials necessary to conduct clinical trials of our product candidates may be insufficient, inadequate or delayed, including as a result of ongoing impacts of the COVID-19 pandemic; and

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

We and our CROs and CMOs, as well as clinical trial sites, may face disruptions related to our ongoing clinical trials, planned clinical trials or future clinical trials arising from manufacturing disruptions, staffing disruptions and limitations on our activities and the activities of our CROs and CMOs, and delays in the ability to obtain necessary institutional review board or other necessary site approvals, as well as other delays at clinical trial sites. We may also face limitations on enrollment and patients withdrawing from our clinical trials or not complying with the protocols, which could delay completion of our clinical trials or adversely affect the data generated by our clinical trials. The impact of these disruptions on our clinical development activities and plans is uncertain and may depend on the length of the disruptions.

If we are required to conduct additional clinical trials or other testing of tazemetostat, EZM0414 or any future product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of tazemetostat, EZM0414 or any future product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive 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 or a risk evaluation mitigation strategy 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.

Our product development costs may also increase if we experience delays in clinical testing or in obtaining marketing approvals such as the delays caused by the partial clinical holds in the United States, France and Germany. We do not know whether any of our preclinical studies or clinical trials will continue or begin as planned, will need to be restructured or will be completed on schedule, or at all. Significant preclinical or clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize our product candidates and may harm our business and results of operations.

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

We may not be able to initiate or continue clinical trials for tazemetostat, EZM0414 or any future 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 similar regulatory authorities outside of the United States. In particular, if our product candidates are focused on specific patient populations, our ability to enroll eligible patients may be limited or may result in slower enrollment than we anticipate. For instance, our ongoing clinical trials of tazemetostat in adult and pediatric patients with INI1-negative tumors are targeting rare patient populations. In addition, some of our competitors have ongoing clinical trials, and may in the future initiate new clinical trials, for product candidates being developed for the same or similar diseases or indications as tazemetostat, EZM0414 or any future product candidates or that may treat the broader patient populations within which tazemetostat, EZM0414 or any future product candidates are being or may be developed for the treatment of a subset of identifiable patients with cancer, which could adversely affect enrollment in our trials, particularly in trials for rare disease indications, as patients who would otherwise be eligible for our clinical trials may instead enroll in clinical trials of our competitors’ product candidates. We have experienced some delays in clinical trial startup as a result of the COVID-19 pandemic, and as the COVID-19 pandemic continues, patient recruitment and enrollment in our clinical trials may be adversely affected, delayed or interrupted. Patients may choose to withdraw from our studies or we may choose to or be required to pause enrollment and or patient dosing in our ongoing clinical trials in order to preserve health resources and protect trial participants. It is unknown how long these pauses or disruptions could continue.

Patient enrollment may be affected by other factors including:

•the severity of the disease under investigation;

•the rarity of the disease under investigation;

•the eligibility criteria for the trial in question;

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

•the efforts to facilitate timely enrollment in clinical trials;

•the patient referral practices of physicians;

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

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

•the potential costs to be incurred by prospective patients in order to participate, such as travel, missed work, and/or childcare;

•the lack of scientific interest in the study; and

•the ability to identify specific patient populations for molecularly defined study cohorts.

Our inability to enroll a sufficient number of patients for our clinical trials would result in significant delays and could require us to abandon one or more clinical trials altogether. Enrollment delays in our clinical trials may result in increased development costs for tazemetostat, EZM0414 or any future product candidates and could delay or prevent our ability to obtain marketing approval, which may cause the value of our company to decline and limit our ability to obtain additional financing.

Our research and development is focused on the creation of novel epigenetic therapies for patients with cancer, which is a rapidly evolving area of science, and the approach we are taking to discover and develop drugs is novel.

The discovery of novel epigenetic therapies for patients with cancer is an emerging field, and the scientific discoveries that form the basis for our efforts to discover and develop tazemetostat and any future product candidates are relatively new. Although epigenetic regulation of gene expression plays an essential role in biological function, few drugs premised on epigenetics have been discovered. Moreover, those drugs based on an epigenetic mechanism that have received marketing approval, other than TAZVERIK, are in different target classes than the

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chromatin modifying protein, or CMP, inhibitors where our research and development is principally focused. Although preclinical studies suggest that genetic alterations can result in changes to the activity of CMPs making them oncogenic, and although the FDA has granted accelerated approval for TAZVERIK in ES and FL with continued approval contingent upon verification and description of clinical benefit in a confirmatory trial for each of the ES and FL indications, to date no company has translated broad biological observations regarding CMP inhibitors into systematic drug discovery, development and commercialization. We believe our early inhibitors of HMTs in clinical trials were the first molecules against these targets to enter clinical development. Therefore, we do not know if our approach of inhibiting HMTs or other CMPs to treat patients with cancer will be successful.

We may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on tazemetostat, EZM0414 and any future 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 managerial resources, we focus on research programs and product candidates that we identify for specific indications. As a result, we may forego or delay pursuit of opportunities with other product candidates or for other indications 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 research and development programs and on tazemetostat, EZM0414 and any future 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 tazemetostat, EZM0414 or a particular future 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.

If we are required to develop a companion or complementary diagnostic and if we or our collaborators are unable to successfully develop diagnostics for tazemetostat, EZM0414 or any future therapeutic product candidates when needed, or experience significant delays in doing so, we may not achieve marketing approval or realize the full commercial potential of our therapeutic product candidates.

We may develop, or we may work with collaborators, to develop diagnostics for tazemetostat, EZM0414 or any future therapeutic product candidates to identify patients for our clinical trials who have the specific cancers that we are seeking to treat as appropriate and when existing, available technology may not be sufficient to identify those patients. We do not have experience or capabilities in developing or commercializing diagnostics and plan to rely in large part on third parties to perform these functions. For example, we have entered into an agreement with Roche Sequencing Solutions, or Roche Sequencing, to develop and commercialize a companion diagnostic for use with tazemetostat for non-Hodgkin lymphoma, or NHL, patients with EZH2 activating mutations. Companion or complementary diagnostics are subject to regulation by the FDA and similar regulatory authorities outside of the United States as medical devices and require separate regulatory approval prior to commercialization. If any third parties that we engage to assist us are unable to successfully develop companion or complementary diagnostics that are needed for our therapeutic product candidates, or experience delays in doing so:

•the development of our therapeutic product candidates may be adversely affected if we are unable to appropriately select patients for enrollment in our clinical trials;

•our therapeutic product candidates may not receive marketing approval if their safe and effective use depends on a companion or complementary diagnostic; and

•we may not realize the full commercial potential of any therapeutic product candidates that receive marketing approval if, among other reasons, we are unable to appropriately identify patients with the specific genetic alterations targeted by our therapeutic product candidates.

If any of these events were to occur, our business would be harmed, possibly materially.

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We may not be successful in our efforts to use and expand our proprietary drug discovery platform to build a pipeline of product candidates.

A key element of our strategy is to utilize our drug discovery platform to progress preclinical efforts and pursue additional product candidates to expand our pipeline of inhibitors against CMPs for the treatment of a variety of different types of cancer. We may not be able to develop product candidates that are safe and effective CMP inhibitors. Even if we are successful in continuing to build our pipeline, the potential product candidates that we identify may not be suitable for clinical development, including as a result of 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. If we do not successfully develop and commercialize product candidates based upon our technological approach, we will not be able to obtain product revenues for additional products in future periods, which likely would result in significant harm to our financial position and adversely affect our stock price.

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 and utilization of tazemetostat in connection with the clinical testing and commercial use of tazemetostat and with respect to any other product candidates that we develop or commercialize. If we cannot successfully defend ourselves against claims that our product candidates or products 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 products that we may develop;

•injury to our reputation and significant negative media attention;

•withdrawal of clinical trial participants or patients;

•significant costs to defend any related litigation;

•substantial monetary awards to trial participants or patients;

•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 $30.0 million in product liability insurance coverage in the aggregate, with a per incident limit of $30.0 million, which may not be adequate to cover all liabilities that we may incur. We will need to increase our insurance coverage as we expand our clinical trials and as we continue to commercialize TAZVERIK, or any other product candidate that we develop. 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.

Enhanced governmental and private scrutiny over, or investigations or litigation involving, pharmaceutical manufacturer donations to patient assistance programs offered by charitable foundations may require us to modify our patient support programs and could negatively impact our business practices, harm our reputation, divert the attention of management and increase our expenses.

To help patients afford tazemetostat, we have implemented a patient assistance program. These types of programs, designed to assist patients in affording pharmaceuticals, have become the subject of scrutiny. In recent years, some pharmaceutical manufacturers were named in class action lawsuits challenging the legality of components of their patient assistance programs and their support of independent charitable foundations in connection with such programs under a variety of federal and state laws. Our patient assistance program could become the target of similar litigation. In addition, certain state and federal enforcement authorities and members of Congress have initiated inquiries about co-pay assistance programs. Some state legislatures have also been considering proposals that would restrict or ban co-pay coupons.

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Further, numerous organizations, including pharmaceutical manufacturers, have received subpoenas from the U.S. Department of Justice, or DOJ, and other enforcement authorities seeking information related to their patient assistance programs and support, and certain of these organizations have entered into, or have otherwise agreed to, significant civil settlements with applicable enforcement authorities. In connection with these civil settlements, the U.S. government has and may in the future require the affected companies to enter into complex corporate integrity agreements that impose significant reporting and other requirements on those companies. We cannot ensure that our compliance controls, policies and procedures will be sufficient to protect against acts of our employees, business partners or vendors that may potentially violate the laws or regulations of the jurisdictions in which we operate. Regardless of whether we have complied with the law, a government investigation could negatively impact our business practices, harm our reputation, divert the attention of management and increase our expenses.

Risks Related to Our Financial Position and Need for Additional Capital

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.

Since inception, we have incurred significant operating losses. Our net loss was $251.1 million for the year ended December 31, 2021, $231.7 million for the year ended December 31, 2020, and $170.3 million for the year ended December 31, 2019. As of December 31, 2021, we had an accumulated deficit of $1,239.8 million. To date, we have generated only limited revenue from sales of TAZVERIK and have not obtained marketing approval of any other product. We have financed our operations primarily through our collaborations, our public offerings, private placements of our common and preferred stock, our loan facility with BioPharma Credit Investments V (Master) LP, BPCR Limited Partnership and BioPharma Credit PLC, and other funding transactions. We have devoted substantially all of our financial resources and efforts to research and development, including clinical and preclinical studies, seeking marketing approval for product candidates and building our commercial organization with respect to TAZVERIK in the indications for which we have received accelerated approval from the FDA. We are continuing to develop tazemetostat for additional indications and to seek to discover and develop EZM0414 and other product candidates. We expect to continue to incur significant expenses and operating losses over the next several years. Our net losses may fluctuate significantly from quarter to quarter and year to year.

We anticipate that we will continue to incur significant expenses if and as we:

•continue to build and refine our sales, marketing and distribution infrastructure and scale up external manufacturing capabilities to support the ongoing commercialization of TAZVERIK and the commercial launch of any other product candidate that is approved;

•grow our medical affairs organization to provide medical support for tazemetostat and any other product candidate that is approved;

•conduct our Phase 1b/3 confirmatory trials in ES and FL;

•design and conduct new and ongoing monotherapy and combination trials of tazemetostat in FL;

•conduct clinical trials or support investigator-sponsored trials to evaluate tazemetostat as a monotherapy or in combinations in additional indications;

•conduct our Phase 1/1b clinical trial of EZM0414 for the treatment of R/R multiple myeloma and DLBCL patients;

•pay any milestone payments provided for and achieved under the amended and restated collaboration and license agreement with Eisai Co Ltd, or Eisai;

•pay interest and principal associated with our amended and restated loan agreement with BioPharma Credit Investments V (Master) LP, BPCR Limited Partnership and BioPharma Credit PLC, or the Amended and Restated Loan Agreement;

•continue the research and development of our other product candidates;

•seek to discover and develop additional product candidates or to expand our product candidates into additional lines of treatment;

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•prepare NDA submissions as we seek regulatory approvals for any product candidates that successfully complete clinical trials;

•maintain, expand and protect our intellectual property portfolio;

•hire additional clinical, quality control, manufacturing and scientific personnel; and

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

To become and remain profitable, we must generate significant revenue. The ability to generate this revenue requires us to successfully commercialize TAZVERIK in ES and FL and in additional indications for which we may develop and obtain approval for tazemetostat, which requires us to be effective in a range of challenging activities. We may never succeed in these activities and, even if we do, may never generate revenues that are significant enough to achieve profitability. Because of the numerous risks and uncertainties associated with the development and commercialization of pharmaceutical products, we are unable to accurately predict the timing or amount of increased expenses or when, or if, we will be able to achieve profitability.

Even if we do 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 research and development efforts, diversify our product offerings or even continue our operations. A decline in the value of our company could cause our stockholders to lose all or part of their investment in our company.

We will need substantial additional funding. If we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our product development programs or commercialization efforts.

We expect our expenses to increase in connection with our ongoing activities, particularly as we expect to incur significant commercialization expenses related to product manufacturing, marketing, sales, and distribution. In addition, we expect our expenses to increase as we fund our tazemetostat development program; make any milestone and royalty payments provided for and achieved under the amended and restated collaboration and license agreement with Eisai; pay interest and principal associated with the Amended and Restated Loan Agreement; and continue research and development and initiate clinical trials of, and seek regulatory approval for, EZM0414 or any future product candidates. Accordingly, we may need to obtain substantial additional funding in connection with our continuing operations. If we are unable to raise capital when needed or on acceptable terms, we could be forced to delay, reduce or eliminate our research and development programs or our commercialization efforts.

Based on our current operating plan, we expect that our existing cash, cash equivalents and marketable securities as of December 31, 2021, together with the $79.5 million in net proceeds raised from the common stock offering in January 2022, and expected cash generated from product sales, will be sufficient to fund planned operating expenses and capital expenditure requirements and pay debt service obligations as they become due, into the third quarter of 2023, without incorporating potential milestone payments, expense reimbursements from existing collaboration agreements or any future business development activities. We have based these expectations on assumptions that may prove to be wrong, such as the revenue that we expect to generate from the sale of our products, and we could use our capital resources sooner than we expect. Our future capital requirements will depend on many factors, including the following, as well as the uncertain impact of the COVID-19 pandemic on these factors:

•the costs of commercialization activities, including product manufacturing, marketing, sales and distribution and patient support programs for tazemetostat or any of our product candidates;

•revenue received from commercial sales of TAZVERIK;

•the progress and results of our ongoing and planned clinical trials of tazemetostat;

•the number and development requirements of additional indications for tazemetostat and other product candidates that we determine to pursue, including the scope, progress, results and costs of discovery research, preclinical development, laboratory testing and clinical trials for such product candidates;

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•the costs, timing and outcome of regulatory review of tazemetostat and other product candidates we may pursue;

•royalties payable by us on sales of TAZVERIK under our amended and restated collaboration and license agreement with Eisai;

•milestones, option exercise fees, license fees, and other revenues, if any, we may receive under collaboration agreements;

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

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

•the extent to which we acquire or in-license other products and technologies; and

•interest and principal payments under the Amended and Restated Loan Agreement.

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 even if regulatory approval is obtained, we may never achieve commercial success. Accordingly, we may 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. In addition, we may seek additional capital due to favorable market conditions or strategic considerations, even if we believe we have sufficient funds for our current or future operating plans.

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 product revenues, we expect to finance our cash needs through a combination of equity offerings, debt financings and license and development agreements with collaboration partners. We do not have any committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our existing stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. We may be limited in our ability to raise additional capital through the sale of equity as we have a limited number of authorized shares that are not issued and outstanding or reserved for future issuance. Additional 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. Our existing indebtedness and the pledge of our assets as collateral limit our ability to obtain additional debt financing.

If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us. 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 commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Our indebtedness resulting from our Amended and Restated Loan Agreement could adversely affect our financial condition or restrict our future operations.

In November 2019, we entered into the Loan Agreement with BioPharma Credit PLC, or the Collateral Agent, and BioPharma Credit Investments V (Master) LP and BPCR Limited Partnership (as transferee of BioPharma Credit Investments V (Master) LP’s interest as a lender), or the Lenders, providing for up to $70.0 million in secured term loans to be advanced in up to three tranches, or the Loan Agreement, of which $25.0 million was drawn by us in

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November 2019, $25.0 million was drawn by us in March 2020, and $20.0 million was drawn by us in June 2020. The maturity date of the first three tranches is November 18, 2024, unless paid earlier.

In November 2020, we entered into an Amended and Restated Loan Agreement with the Collateral Agent and the Lenders, amending and restating the Loan Agreement to provide for, among other things, an additional secured term loan facility of $150.0 million, or the Tranche D Loan. In November 2020, we drew the $150.0 million Tranche D Loan. The maturity date of the Tranche D Loan is November 18, 2026, unless terminated earlier.

Subject to customary exceptions and exclusions, all obligations under the Amended and Restated Loan Agreement are secured pursuant to the terms of the Amended and Restated Loan Agreement, a guaranty and security agreement between us, certain of our subsidiaries, and the Collateral Agent, or the Pledge Agreement, and intellectual property and security agreements between us and Collateral Agent, or the IP Security Agreements. Under the Amended and Restated Loan Agreement, the Pledge Agreement, and the IP Security Agreements, we provided to the Lenders a perfected, first-priority security interest in all of our personal property and a perfected, first-priority security interest in substantially all of our intellectual property related to tazemetostat.

A failure to comply with the conditions of the Amended and Restated Loan Agreement could result in an event of default. An event of default under the term loan facility includes, among other things, a failure to pay any amount due under the Amended and Restated Loan Agreement as well as the occurrence of events that could reasonably be expected to result in a material adverse change. In the event of an acceleration of amounts due under the Amended and Restated Loan Agreement as a result of an event of default, we may not have sufficient funds or may be unable to arrange for additional financing to repay the term loans or to make any accelerated payments.

Risks Related to Our Dependence on Third Parties

Our existing therapeutic collaborations are important to our business, and future collaborations may also be important to us. If we are unable to maintain any of these collaborations, or if these collaborations are not successful, our business could be adversely affected.

Our resources for drug development are limited and we continue to build our sales, marketing, medical affairs and supply chain infrastructure. Accordingly, we have entered into therapeutic collaborations with other companies that we believe can contribute to our ability to rapidly develop and commercialize TAZVERIK and any product candidates we may identify and develop, including our license agreement with HutchMed. Our collaborations have provided us with important funding for our development programs and product platform and we expect to receive additional funding under these collaborations in the future. Our existing therapeutic collaborations, and any future collaborations we enter into, may pose a number of risks, including the following:

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

•collaborators may not have the ability or the development capabilities to perform their obligations as expected, including as a result of the impact of the COVID-19 pandemic on our collaborators’ operations or business;

•collaborators may not pursue 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 may 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, not initiate or delay initiation of clinical trials, pause or stop enrollment in a clinical trial, terminate an ongoing clinical trial, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing;

•collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our products and product candidates if the collaborators believe that the competitive

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products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours;

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

•a collaborator may fail to comply with applicable regulatory requirements regarding the development, manufacture, distribution or marketing of a product candidate or product;

•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 product or products;

•disagreements with collaborators, including disagreements over proprietary rights, contract interpretation or the preferred course of development, might cause delays or terminations 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 intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation;

•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.

If our therapeutic collaborations do not result in the successful development and commercialization of products or if one of our collaborators terminates its collaboration with us, we may not receive the funding under the collaboration that we anticipated. If we do not receive the funding we expect under these agreements, our development of our product platform and product candidates could be delayed and we may need additional resources to develop product candidates and our product platform. All of the risks relating to product development, regulatory approval and commercialization described in this Annual Report on Form 10-K also apply to the activities of our therapeutic collaborators.

Our existing therapeutic collaborations contain restrictions on our ability to engage in activities that are the subject of the collaboration with third parties for specified periods of time. These restrictions may have the effect of preventing us from undertaking development and other efforts that may appear to be attractive to us.

Additionally, subject to its contractual obligations to us, if a collaborator of ours is involved in a business combination, the collaborator might deemphasize or terminate the development or commercialization of any product candidate licensed to it by us. If one of our collaborators terminates its agreement with us, we may find it more difficult to attract new collaborators and our perception in the business and financial communities could be adversely affected. In the fourth quarter of 2021, Glaxo Group Limited, an affiliate of GSK, terminated its collaboration with us without cause, effective March 16, 2022.

For some of our product candidates or for some CMP targets, we may in the future collaborate with pharmaceutical and biotechnology companies for development and potential commercialization of therapeutic products. We face significant competition in seeking appropriate collaborators. Our ability to reach a definitive agreement for a collaboration will depend, among other things, upon our assessment of the collaborator’s resources and expertise, the terms and conditions of the proposed collaboration and the proposed collaborator’s evaluation of a number of factors. If we are unable to reach agreements with suitable collaborators on a timely basis, on acceptable terms, or at all, we may have to increase our expenditures and undertake development or commercialization activities for the product candidate or program on our own or at our own expense or curtail the development of a 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. If we elect to fund and undertake

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development or commercialization activities on our own, we may need to obtain additional expertise and additional capital, which may not be available to us on acceptable terms or at all. If we do not have sufficient funds or expertise to undertake the necessary development and commercialization activities, we may not be able to further develop our product candidates or bring them to market or continue to develop our product platform and our business may be materially and adversely affected.

Failure of our third-party collaborators to successfully commercialize diagnostics, developed for use with our therapeutic product candidates, if and when needed, could harm our ability to commercialize these product candidates.

We do not plan to develop diagnostics internally and, as a result, if diagnostics are needed, we will be dependent on the efforts of our third-party collaborators to successfully commercialize diagnostics when existing, available technology may not be sufficient to identify patients for treatment with our therapeutic product candidates. For example, Roche Sequencing has developed a companion diagnostic kit for detecting activating mutations in EZH2 in the tazemetostat NHL program. Our collaborators:

•may not perform their obligations as expected or have difficulty responding to accelerated approval timelines alongside the therapeutic product development;

•may encounter production difficulties that could constrain the supply of the diagnostics;

•may encounter delays or have difficulty obtaining regulatory approval for the diagnostic in target markets;

•may have difficulties gaining acceptance of the use of the diagnostics in the clinical community;

•may not pursue commercialization of any diagnostics that achieve regulatory approval;

•may elect not to continue or renew commercialization programs based on changes in the collaborators’ strategic focus or available funding, or external factors such as an acquisition, that divert resources or create competing priorities;

•may not commit sufficient resources to the marketing and distribution of such product or products; and

•may terminate their relationship with us.

If required diagnostics for use with our therapeutic product candidates fail to gain market acceptance, our ability to derive revenues from sales of our therapeutic product candidates could be harmed. If our collaborators fail to commercialize these diagnostics, we may not be able to enter into arrangements with another diagnostic company to obtain supplies of an alternative diagnostic test for use in connection with our therapeutic product candidates or do so on commercially reasonable terms, which could adversely affect and delay the development or commercialization of our therapeutic product candidates.

We rely, and expect to continue to rely, on third parties to conduct our clinical trials, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials.

We currently rely on third-party clinical research organizations to conduct our ongoing clinical trials. We do not plan to independently conduct clinical trials of tazemetostat, EZM0414 or any future product candidates. We expect to continue to rely on third parties, such as clinical research organizations, research collaborative groups, clinical data management organizations, medical institutions and clinical investigators, to conduct our clinical trials. These agreements might terminate for a variety of reasons, including a failure to perform by the third parties. If we need to enter into alternative arrangements, our product development activities might be delayed.

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, 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 or patients are protected. We also are required to register ongoing clinical trials and post the results of completed clinical trials on a

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government-sponsored database, ClinicalTrials.gov, within specified timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.

Furthermore, these third parties may also have relationships with other entities, some of which may be our competitors. If these third parties do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, we will not be able to obtain, or may be delayed in obtaining, marketing approvals for our product candidates and will not be able to, or may be delayed in our efforts to, successfully commercialize our product candidates.

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

We contract with third parties for the manufacture of tazemetostat for commercialization and clinical testing and EZM0414 for clinical testing, and expect to contract with third parties for the manufacture of any other product candidates that we develop for preclinical and clinical testing and for commercialization. This reliance on third parties increases the risk that we will not have sufficient quantities of our product candidates or products or such quantities at an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts.

We do not have any manufacturing facilities and rely, and expect to continue to rely, on third parties for the manufacture of our product candidates for preclinical and clinical testing, as well as for commercial manufacture of tazemetostat and any other product candidates we develop that receive marketing approval. This reliance on third parties increases the risk that we will not have sufficient quantities of tazemetostat, EZM0414 or any other product candidate or such quantities at an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts.

We may be unable to establish any agreements with third-party manufacturers or to do so on a timely basis or on acceptable terms. Even if we are able to establish agreements with third-party manufacturers, reliance on such 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 possible misappropriation of our proprietary information, including our trade secrets and know-how; and

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

Third-party manufacturers may not be able to comply with current good manufacturing practices, or cGMP, regulations or similar regulatory requirements outside of the United States. 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 products, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect supplies of our products.

Tazemetostat, EZM0414 and any other product candidate that we may develop may compete with other product candidates and products for access to manufacturing facilities. There are a limited number of manufacturers that operate under cGMP regulations and that might be capable of manufacturing for us.

Any performance failure on the part of our existing or future manufacturers could delay clinical development, or marketing approval, and could adversely impact our ability to sell our approved products. We have already built additional redundancy in our supply chain and have plans to continue to qualify additional raw material manufacturers in our TAZVERIK supply chain. If our current contract manufacturers cannot perform as agreed, we

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may be required to replace such manufacturers. We expect that we would incur added costs and delays in identifying and qualifying any such replacement.

Our current and anticipated future dependence upon others for the manufacture of our product candidates or products may adversely affect our future profit margins and our ability to commercialize any products that receive marketing approval on a timely and competitive basis.

Risks Related to Our Intellectual Property

If we are unable to obtain, maintain and enforce patent protection for our technology, products and product candidates or if the scope of the patent protection obtained is not sufficiently broad, our competitors could develop and commercialize technology, products or product candidates similar or identical to ours, and our ability to successfully develop and commercialize our technology, products or product candidates may be impaired.

Our success depends in large part on our ability to obtain, maintain and enforce patent protection in the United States and foreign jurisdictions with respect to our proprietary technology, products and product candidates. We seek to protect our proprietary position by filing patent applications in the United States and abroad related to our novel technology, products and product candidates.

The patent prosecution process is expensive, time-consuming and complex, and we may not be able to file, prosecute or maintain all necessary or desirable patent applications at a reasonable cost or in a timely manner. It is also possible that we may fail to identify patentable aspects of our research and development output before it is too late to obtain patent protection. Moreover, in some circumstances, we do not have the right to control the preparation, filing and prosecution of patent applications, or to maintain the patents, covering technology that we license from third parties. Therefore, these in-licensed patents and applications may not be prepared, filed, prosecuted or maintained in a manner consistent with the best interests of our business.

Although we enter into non-disclosure and confidentiality agreements with parties who may have access to confidential or patentable aspects of our research and development output, such as our employees, collaborators, contract research organizations, contract manufacturers, consultants, advisors and other third parties, any of these parties may breach the agreements and disclose such output before a patent application is filed, thereby potentially jeopardizing our ability to seek patent protection.

The patent position of biotechnology and pharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has in recent years been the subject of much litigation. In addition, the scope of our patent protection outside of the United States is uncertain, and laws of foreign jurisdictions may not protect our rights to the same extent as the laws of the United States. For example, European patent law restricts the patentability of methods of treatment of the human body more than United States law does. With respect to our patent rights, we cannot predict whether the patent applications we and/or our licensors are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient protection from competitors. In addition, publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and foreign jurisdictions are typically not published until 18 months after filing, or in some cases at all. Therefore, neither we nor our licensors can know with certainty whether we were the first to make the inventions claimed in the patents or pending patent applications, or that we or our licensors were the first to file for patent protection of such inventions. As a result, the issuance, scope, validity, enforceability and commercial value of our patent rights are highly uncertain. Our pending and future patent applications may not result in patents being issued which protect our technology, products or product candidates, in whole or in part, or which effectively prevent others from developing or commercializing competitive technologies, products and product candidates. Changes in either the patent laws or interpretation of the patent laws in the United States and foreign jurisdictions may diminish the value of our patent rights or narrow the scope of our patent protection.

Moreover, we may be subject to a third-party preissuance submission of prior art to the U.S. Patent and Trademark Office, or USPTO, or become involved in opposition, derivation, reexamination, inter partes review, post-grant review or interference proceedings challenging our patent rights or the patent rights of others. For example, we are

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involved in an opposition proceeding against one of our European patents, the claims of which cover a method for determining whether a cancer patient is a candidate for treatment with an EZH2 inhibitor based on their EZH2 mutation status. An adverse determination in any such submission, proceeding or litigation could reduce the scope of, or invalidate, our patent rights, allow third parties to commercialize our technology or products and compete directly with us, without payment to us, or result in our inability to manufacture or commercialize our technology or products without infringing, misappropriating or otherwise violating third-party patent rights. In addition, if the breadth or strength of protection provided by our owned and/or in-licensed patents and patent applications is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize our technology, products or product candidates. Furthermore, such proceedings also may result in substantial cost and divert the time and attention of our management and employees, even if the eventual outcome is favorable to us.

In addition, the coverage claimed in a patent application may be significantly reduced before the patent is issued, and its scope may be reinterpreted after issuance. Even if our owned and/or in-licensed patent applications issue as patents, they may not issue in a form that will provide us with any meaningful protection, prevent competitors from competing with us or otherwise provide us with any competitive advantage. The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our owned and/or in-licensed patents may be challenged in the courts or patent offices in the United States and abroad. Such challenges may result in loss of exclusivity or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our technology and products. Such proceedings also may result in substantial cost and divert the time and attention of our management and employees, even if the eventual outcome is favorable to us. 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. Furthermore, our competitors may be able to circumvent our owned and/or in-licensed patents by developing similar or alternative technologies or products in a non-infringing manner. As a result, our owned and/or in-licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing technology and/or products similar or identical to any of our technology and products.

Moreover, some of our owned and/or in-licensed patents and patent applications are, and may in the future be, co-owned with third parties. If we are unable to obtain an exclusive license to any such third-party co-owners’ interest in such patents or patent applications, such co-owners may be able to license their rights to other third parties, including our competitors, and our competitors could market competing technology and products. In addition, we may need the cooperation of any such co-owner of our patents in order to enforce such patents against third parties, and such cooperation may not be provided to us.

If we do not obtain patent term extension for our products, our business may be materially harmed.

In the United States, depending upon the timing, duration and specifics of any FDA marketing approval of a product candidate, the patent term of a patent that covers an FDA-approved product may be eligible for patent term extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory review process. The Drug Price Competition and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act, permits a patent term extension of up to five years beyond the expiration of the patent for those claims covering the approved product, a method for using it or a method for manufacturing such product. Similar provisions are available in Europe and other foreign jurisdictions to extend the term of a patent that covers an approved drug. We have applied for patent term extension on a patent that covers the TAZVERIK drug substance based on the regulatory review of TAZVERIK for the treatment of adult and pediatric patients aged 16 years and older with metastatic or locally advanced ES not eligible for complete resection. In the future, if and when any additional product candidates receive FDA approval, we expect to apply for patent term extensions on patents covering those approved products. Similarly, in foreign jurisdictions where we have obtained regulatory approval, we intend to seek patent term extensions for any applicable issued patent rights if such extensions are available, however there is no guarantee that the applicable authorities will agree with our assessment of whether such extensions should be granted, and even if granted, the length of any such extensions. We may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of the relevant patent(s), or otherwise failing to satisfy applicable requirements. If we are unable to obtain any patent term extension or the term of any such extension is less than we request, our competitors may obtain approval of competing products following

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the expiration of our patent rights, and our business, financial condition, results of operations and commercial prospects could be materially harmed.

Changes to patent laws in the United States and foreign jurisdictions could significantly diminish the value of patents in general, thereby impairing our ability to protect our technology, products and product candidates.

Changes in either the patent laws or interpretation of patent laws in the United States by the United States Congress, the federal courts, or the USPTO, including patent reform legislation such as the Leahy-Smith America Invents Act, or the Leahy-Smith Act, or similar changes in other jurisdictions whether by governments, courts or regulators, could increase the uncertainties and costs surrounding the prosecution of our owned or in-licensed patent applications and the enforcement or defense of our issued patent rights. For example, the Leahy-Smith Act includes a number of significant changes to United States patent law. These changes include provisions that affect the way patent applications are prosecuted, redefine prior art, provide more efficient and cost-effective avenues for competitors to challenge the validity of patents, and enable third-party submission of prior art to the USPTO during patent prosecution and additional procedures to attack the validity of a patent at USPTO administered post-grant proceedings, including post-grant review, inter partes review and derivation proceedings. Assuming that other statutory requirements for patentability are met, prior to March 2013, in the United States, the first to invent the claimed invention was entitled to the patent, while outside the United States, the first to file a patent application was entitled to the patent. After March 2013, under the Leahy-Smith Act, the United States transitioned to a first inventor to file system in which, assuming that the other statutory requirements for patentability are met, the first inventor to file a patent application will be entitled to the patent on an invention regardless of whether a third party was the first to invent the claimed invention. Accordingly, changes in either the patent laws or interpretation of patent laws in the United States or in foreign jurisdictions and their implementation could increase the uncertainties and costs surrounding the prosecution of our owned and/or in-licensed patent applications and the enforcement or defense of our issued patent rights, which could have a material adverse effect on our business and financial condition.

We may become involved in lawsuits or other legal proceedings to protect or enforce our patent or other intellectual property rights, which could be expensive, time consuming and unsuccessful.

Competitors may infringe, misappropriate or otherwise violate our patent or other intellectual property rights. As a result, we may need to file infringement, misappropriation or other intellectual property claims, which can be expensive and time consuming. Any claims we assert against perceived infringers could provoke these parties to assert counterclaims against us alleging that we infringe, misappropriate or otherwise violate their intellectual property rights. Such parties could also counterclaim that the patent rights we have asserted are invalid or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or non-enablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld relevant information, or made a misleading statement, during prosecution. Moreover, third parties may institute such claims before administrative bodies in the United States or abroad, and within or outside of the context of litigation. Such mechanisms include re-examination, post-grant review, inter partes review, interference proceedings, derivation proceedings and equivalent proceedings in foreign jurisdictions (e.g., opposition proceedings).

An adverse result in any such proceeding could put one or more of our patent rights at risk of being invalidated or interpreted narrowly, and could put one or more of our owned and/or in-licensed patent applications at risk of being found unpatentable. Any of the foregoing could limit our ability to limit our competitors’ ability to develop and commercialize competing technologies and products and could have a material adverse impact on our business, financial condition, results of operations and prospects.

We may need to license certain intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms.

A third party may hold intellectual property rights, including patent rights, that are important or necessary to the development of our technology or product candidates or commercialization of our technology or products. It may be necessary for us to use the patented or proprietary technology of third parties to develop our technology or product candidates or commercialize our technology or products, in which case we may be required to obtain a license from

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these third parties. Such licenses may not be available on commercially reasonable terms, or at all, or may only be available on a non-exclusive basis, any of which could have a material adverse impact on our business, financial condition, results of operations and prospects.

Third parties may initiate legal proceedings alleging that we are infringing, misappropriating or otherwise violating their intellectual property rights, the outcome of which would be uncertain and could have a material adverse effect on the success of our business.

Our commercial success depends upon our ability, and the ability of our collaborators, to develop, manufacture, market and sell our current and future products and use our proprietary technology without infringing, misappropriating or otherwise violating the proprietary rights of third parties. There is considerable intellectual property litigation in the biotechnology and pharmaceutical industries. We may become party to, or threatened with, litigation or administrative proceedings regarding intellectual property rights with respect to our technology, products and product candidates, including interference proceedings, post grant review, inter partes review and derivation proceedings before the USPTO and similar proceedings in foreign jurisdictions such as oppositions before the European Patent Office.

Third parties may assert infringement claims against us based on existing patents or patents that may be granted in the future, regardless of merit. For example, with respect to tazemetostat, we are aware of a U.S. patent held by a third party, which could be construed to cover the use of tazemetostat in certain clinical indications. We have preemptively requested inter partes review at the USPTO challenging the validity of that patent. In the event that an owner of this patent were to bring an infringement action against us, we believe we have defenses that we could assert in such event, and additionally in the USPTO, including the invalidity of the relevant claims of such patents. However, we may not be successful in asserting these defenses, including proving invalidity, and could be found to infringe this third-party patent.

We may not be aware of all intellectual property rights potentially relating to our technology, products and product candidates and their potential uses. Thus, we do not know with certainty that our technology, products and product candidates or our development and commercialization thereof, do not and will not infringe, misappropriate or otherwise violate any third party’s intellectual property.

Even if we believe that third party intellectual property claims are without merit, there is no assurance that a court or other judicial or regulatory body would find in our favor on questions of misappropriation, infringement, validity, enforceability or priority. A court of competent jurisdiction or other applicable regulatory body could disregard any claims that we make and hold that third-party patents are valid, enforceable and infringed. In order to successfully challenge the validity of any U.S. patent in federal court, we would need to overcome a presumption of validity. As this burden is a high one requiring us to present clear and convincing evidence as to the invalidity of any such U.S. patent claim, there is no assurance that a court of competent jurisdiction would invalidate the claims of any such U.S. patent.

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 developing, manufacturing and marketing our technology, products and product candidates. However, we may not be able to obtain any required license on commercially reasonable terms or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors access to the same technologies licensed to us and could require us to make substantial licensing and/or royalty payments. We could be forced, including by court order, to cease developing, manufacturing and/or commercializing the infringing technology, product candidates or products. In addition, we could be found liable for significant monetary damages, including treble damages and attorneys’ fees if we are found to have willfully infringed a patent or other intellectual property right and could be forced to indemnify our customers or collaborators. A finding of infringement could prevent us from commercializing our technology, product candidates or products and/or could force us to cease some of our business operations, which could materially harm our business. Additionally, we could be forced to redesign our products or product candidates, seek new regulatory approvals or indemnify third parties pursuant to contractual agreements. Claims that we have misappropriated the confidential information or trade secrets of third parties could have a similar negative impact on our business, financial condition, results of operations and prospects.

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

Periodic maintenance, renewal and annuity fees and various other governmental fees on any issued patent and pending patent application must be paid to the USPTO and foreign patent agencies in several stages or annually over the lifetime of our owned and/or in-licensed patents and patent applications. The USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process. In certain circumstances, we rely on our licensing partners to pay these fees to, or comply with the procedural and documentary rules of, the relevant patent agency. With respect to our patent rights, we employ reputable law firms and other professionals to help us comply, and we rely on an annuity service to remind us of the due dates and to make payment after we instruct them to do so. Non-compliance events that could result in abandonment or lapse of a patent or patent application include, but are not limited to, failure to respond to official actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents. In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules, however the ability to cure may not be possible in some cases or may be subject to certain deadlines or other restrictions that may not be practicable to satisfy. While to date we have not experienced any material abandonment, lapse or loss of patent rights that was not able to be cured, there could be situations in which non-compliance could result in material abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. If we or our licensors fail to maintain the patents and patent applications covering our technology, products or product candidates, potential competitors might be able to enter the market with similar or identical technology, products or product candidates, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

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

We are party to license and research agreements that impose, and we may enter into additional licensing and funding arrangements with third parties that may impose, on us diligence, development and commercialization timelines, milestone payment, royalty, insurance and other obligations. Under our existing licensing and funding agreements, we are obligated to pay royalties on net product sales of products or related technologies to the extent they are covered by the agreements. If we fail to comply with our obligations under current or future license and funding agreements, our counterparties may have the right to terminate these agreements, in which event we might not be able to develop, manufacture or commercialize any product that is covered by these agreements or may face other penalties under the agreements. Such an occurrence could materially adversely affect the value of the products or product candidates being developed under any such agreement. Termination of these agreements or reduction or elimination of our rights under these agreements 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, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

We may be subject to claims by third parties asserting that our employees, consultants, contractors or we have wrongfully used or disclosed alleged trade secrets of their current or former employers or claims asserting that we have misappropriated their intellectual property, or claiming ownership of what we regard as our own intellectual property.

Many of our employees, consultants and contractors were previously employed at universities or other biotechnology or pharmaceutical companies, including our competitors or potential competitors. Although we try to ensure that our employees, consultants and contractors do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that these employees, consultants and contractors or we have used or disclosed intellectual property, including trade secrets or other proprietary information, of any such employee’s former employer. Litigation may be necessary to defend against these claims.

In addition, while it is our policy to require our employees, consultants and contractors who may be involved in the 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 develops or has developed intellectual property that we regard as our own. Our and their assignment agreements may not be self-executing or may be

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breached, and we may be forced to bring claims against third parties, or defend claims they may bring against us, to determine the ownership of what we regard as our intellectual property.

If we fail in prosecuting or defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel, which could have a material adverse effect on our competitive business position and prospects. Such intellectual property rights could be awarded to a third party, and we could be required to obtain a license from such third party to develop and/or commercialize our technology, product candidates, and/or products, which license may not be available on commercially reasonable terms, or at all, or such license may be non-exclusive. Even if we are successful in prosecuting or defending against such claims, litigation could result in substantial costs and be a distraction to our management and employees.

Intellectual property litigation or other legal proceedings relating to intellectual property could cause us to spend substantial resources and distract our personnel from their normal responsibilities.

Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses, and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our common stock. Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources and may also have an advantage in such proceedings due to their more mature and developed intellectual property portfolios. Uncertainties resulting from the initiation and continuation of patent or other intellectual property litigation or other proceedings could compromise our ability to compete in the marketplace.

If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed.

In addition to seeking patents for some of our technology, products and product candidates, we also rely on trade secrets, including unpatented know-how, technology and other proprietary information, to maintain our competitive position. We seek to protect these trade secrets and other proprietary technology, in part, by entering into non-disclosure and confidentiality agreements with parties who have access to them, such as our employees, corporate collaborators, outside scientific collaborators, contract research organizations, contract manufacturers, consultants, advisors and other third parties. We also enter into confidentiality and invention or patent assignment agreements with our employees, consultants and contractors. Despite these efforts, any of these parties may breach the agreements and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming, and the outcome is unpredictable. In addition, some courts inside and outside of the United States are less willing or unwilling to protect trade secrets. 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 could be harmed.

Risks Related to Regulatory Approval of Our Product Candidates and Other Legal Compliance Matters

The marketing approval process is expensive, time-consuming and uncertain and may prevent us from obtaining approvals for the commercialization of some or all of our product candidates. If we are not able to obtain, or if there are delays in obtaining, required regulatory approvals, we will not be able to commercialize tazemetostat for other indications or any other of our product candidates that we develop, and our ability to generate revenue will be materially impaired.

Our product and product candidates, including tazemetostat, and the activities associated with their development and commercialization, including their design, testing, manufacture, safety, efficacy, recordkeeping, labeling, storage,

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approval, advertising, promotion, sale and distribution, export and import are subject to comprehensive regulation by the FDA and other regulatory agencies in the United States and by the EMA and similar regulatory authorities outside of the United States.

Failure to obtain marketing approval for tazemetostat for any potential indication or of any other product candidate will prevent us from commercializing tazemetostat for that indication or the product candidate. We have only limited experience in filing and supporting the applications necessary to gain marketing approvals and rely on third-party clinical research organizations to assist us in this process. Securing marketing approval requires the submission of extensive preclinical, clinical and manufacturing data and supporting information to regulatory authorities for each therapeutic indication to establish the product candidate’s safety, efficacy and quality. Securing marketing approval also requires the submission of information about the product manufacturing process to, and inspection of manufacturing facilities by, the regulatory authorities. Our product candidates for which we seek approval may not be effective, may be only moderately effective or may prove to have undesirable or unintended side effects, toxicities or other characteristics that may preclude our obtaining marketing approval or prevent or limit commercial use. New cancer drugs frequently are indicated only for patient populations that have not responded to an existing therapy or have relapsed.

The process of obtaining marketing approvals, both in the United States and abroad, is expensive, may take many years if additional clinical trials are required, if approval is obtained at all, and can vary substantially based upon a variety of factors, including the type, complexity and novelty of the product candidates involved. Changes in marketing approval policies during the development period, changes in or the enactment of additional statutes or regulations, or changes in regulatory review for each submitted product application, may cause delays in the approval or rejection of an application. Regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may decide that our data is insufficient for approval and require additional preclinical, clinical or other studies, or additional manufacturing data. In addition, varying interpretations of the data obtained from preclinical and clinical testing could delay, limit or prevent marketing approval of a product candidate on an accelerated basis or at all. Any marketing approval we ultimately obtain may be limited or subject to restrictions or post-approval commitments that render the approved product not commercially viable.

We received accelerated approval of TAZVERIK in patients with ES and in patients with relapsed or refractory FL. In order to obtain accelerated approval for future indications in tazemetostat or any other product candidate, we must demonstrate that our product candidate provides meaningful therapeutic benefit over existing treatments. In addition, as a condition of accelerated approval of TAZVERIK in ES and FL, continued approval for these indications is contingent upon verification and description of clinical benefit in post-marketing confirmatory trials to verify and describe the anticipated effect on irreversible morbidity or mortality or other clinical benefit, and if the studies are unsuccessful for a given indication, TAZVERIK in ES or FL may be subject to withdrawal procedures.

Additionally, the FDA and comparable foreign regulatory agencies may have slower response times or be under-resourced to continue to monitor our future applications for accelerated approval or our ongoing clinical trials due to the COVID-19 pandemic and, as a result, review, inspection, and other timelines may be materially delayed. It is unknown how long these disruptions could continue, were they to occur. Any elongation or de-prioritization of our clinical trials or delay in regulatory review resulting from such disruptions could materially affect the development and study of our product candidates.

We may not be able to obtain, or may be delayed in obtaining, orphan drug exclusivity for our product candidates and, even if we do, that exclusivity may not prevent the FDA or the EMA from approving other competing products.

Regulatory authorities in some jurisdictions, including the United States and Europe, may designate drugs for relatively small patient populations as orphan drugs. Under the Orphan Drug Act, the FDA may designate a product as an orphan drug if it is a drug intended to treat a rare disease or condition, which is generally defined as a patient population of fewer than 200,000 individuals annually in the United States.

We have obtained orphan drug designations in the United States for tazemetostat for the treatment of patients with FL, chordoma, malignant rhabdoid tumors, or MRT, soft tissue sarcoma, or STS, and mesothelioma. The orphan

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drug designation for the treatment of MRT applies to INI1-negative MRT as well as SMARCA4-negative malignant rhabdoid tumor of ovary, or MRTO. We have also obtained orphan drug designations for tazemetostat for the treatment of patients with FL, DLBCL and malignant mesothelioma in Europe.

We have also received orphan drug designation from the FDA for EZM0414 for the treatment of multiple myeloma. We may not receive orphan drug designation for tazemetostat or for EZM0414 for other indications, or for any other future clinical candidates we may develop.

We have also obtained marketing exclusivity designations for tazemetostat for the treatment of patients with ES and FL. Generally, if a product with an orphan drug designation subsequently receives the first marketing approval for the indication for which it has such designation, the product is entitled to a period of marketing exclusivity, which precludes the EMA or the FDA from approving another marketing application for the same drug for the same indication for that time period. The applicable period is seven years in the United States and ten years in Europe. The exclusivity period in Europe can be reduced to six years if a drug no longer meets the criteria for orphan drug designation or if the drug is sufficiently profitable so that market exclusivity is no longer justified. Orphan drug exclusivity may be lost if the FDA or EMA 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.

Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different drugs can be approved for the same condition. In addition, even after an orphan drug is approved, the FDA can subsequently approve the same drug for the same condition if the FDA concludes that the later drug is clinically superior in that it is shown to be safer, more effective or makes a major contribution to patient care.

On August 18, 2017, Congress passed the FDA Reauthorization Act of 2017, or FDARA. FDARA, among other things, codified the FDA’s pre-existing regulatory interpretation, to require that a drug sponsor demonstrate the clinical superiority of an orphan drug that is otherwise the same as a previously approved drug for the same rare disease in order to receive orphan drug exclusivity. The new legislation reverses prior precedent holding that the Orphan Drug Act unambiguously requires that the FDA recognize the orphan exclusivity period regardless of a showing of clinical superiority. Under Omnibus legislation signed by President Trump on December 27, 2020, the requirement for a product to show clinical superiority applies to drugs and biologics that received orphan drug designation before enactment of FDARA in 2017 but has not yet been approved or licensed by the FDA.

The FDA may further reevaluate the Orphan Drug Act and its regulations and policies. This may be particularly true in light of a decision from the Court of Appeals for the 11th Circuit in September 2021 finding that, for the purpose of determining the scope of exclusivity, the term “same disease or condition” means the designated “rare disease or condition” and could not be interpreted by the FDA to mean the “indication or use.” The court concluded that orphan drug exclusivity applies to the entire designated disease or condition rather than the “indication or use”. We do not know if, when, or how the FDA may change the orphan drug regulations and policies in the future, and it is uncertain how any changes might affect our business. Depending on what changes the FDA may make to its orphan drug regulations and policies, our business could be adversely impacted.

In addition, FDARA amended section 505B “Research into pediatric uses for drugs and biological products” of the Federal Food, Drug and Cosmetic Act (21 U.S.C. Section 355c). Previously, drugs that had been granted orphan drug designation were exempt from the requirements of the Pediatric Research Equity Act. Under the amended section 505B, beginning on August 18, 2020, the submission of a pediatric assessment, waiver or deferral will be required for certain molecularly targeted cancer indications with the submission of an NDA application or supplement to an NDA application. Under FDARA, products with orphan drug designation that fall under this category will no longer be exempt from the pediatric research requirement. In December 2019, the FDA issued draft guidance interpreting and implementing these provisions. FL qualifies for an automatic full pediatric waiver by the FDA because it rarely or never occurs in pediatric patients. However, our other indications in development or future product candidates may require a pediatric assessment, which could result in delays in obtaining orphan drug exclusivity and increased costs and delays in obtaining regulatory approval.

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We may seek certain designations for our product candidates, including Fast Track and Breakthrough Therapy, designations, but we might not receive such designations, and even if we do, such designations may not lead to a faster development or regulatory review or approval process.

We may seek certain designations for one or more of our product candidates that could expedite review and approval by the FDA. For example, if a drug is intended for the treatment of a serious or life-threatening condition and the drug demonstrates the potential to address unmet medical needs for this condition, the drug sponsor may apply for FDA Fast Track designation. Drugs that have received Fast Track designation from the FDA are eligible for expedited development and priority review, and the opportunity for a rolling review, under certain circumstances.

A breakthrough therapy is defined as a drug that is intended, alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition, and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. For drugs and biologics that have been designated as breakthrough therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens. Drugs designated as breakthrough therapies by the FDA are also eligible for accelerated approval.

We have received Fast Track designation from the FDA for tazemetostat for patients with relapsed or refractory FL, relapsed or refractory DLBCL with EZH2 activating mutations, and metastatic or locally advanced ES who have progressed on or following an anthracycline-based treatment regimen. We have also received Fast Track designation from the FDA for EZM0414 in adult patients with relapsed or refractory DLBCL. We intend to seek Fast Track designation for tazemetostat and EZM0414 for other indications and any other future product candidates as appropriate. Our submissions for marketing approval of tazemetostat in ES and FL received expedited development and priority review. We may also seek breakthrough therapy designation for tazemetostat, EZM0414 or any future product candidate we may develop.

The FDA has broad discretion whether or not to grant such designations, so even if we believe a particular product candidate is eligible for the designation, we cannot assure that the FDA would decide to grant it. Moreover, even if we do receive Fast Track or breakthrough therapy designation, we may not experience a faster development process, review or approval compared to conventional FDA procedures. We or the FDA may withdraw these designations if either party believes that the designation is no longer supported by data from our clinical development program.

Failure to obtain marketing approval in foreign jurisdictions would prevent our product candidates from being marketed in those jurisdictions.

In order to market and sell TAZVERIK or any other product candidate that we may develop in the European Union, or EU, and many other foreign jurisdictions, we or our third-party collaborators must obtain separate marketing approvals and comply with numerous and varying regulatory requirements. The approval procedure varies among countries and can involve additional testing. The time required to obtain approval may differ substantially from that required to obtain FDA approval. The regulatory approval process outside of the United States generally includes all of the risks associated with obtaining FDA approval. In addition, in many countries outside of the United States, a product must be approved for reimbursement before the product can be approved for sale in that country. We or our third-party collaborators may not obtain approvals from regulatory authorities outside of the United States on a timely basis, if at all. Approval by the FDA does not ensure approval by regulatory authorities in other countries or jurisdictions, and approval by one regulatory authority outside of the United States does not ensure approval by regulatory authorities in other countries or jurisdictions or by the FDA. We may not be able to file for marketing approvals and may not receive necessary approvals to commercialize our products in any market.

Additionally, on June 23, 2016, the electorate in the United Kingdom voted in favor of leaving the European Union, commonly referred to as Brexit. Following protracted negotiations, the United Kingdom left the European Union on January 31, 2020 and a transition period to December 31, 2020, was established to allow the United Kingdom and the European Union to negotiate the United Kingdom’s withdrawal. As a result, effective January 1, 2021, the United Kingdom is no longer part of the European Single Market and European Union Customs Union. A co-operation agreement was signed between the United Kingdom and the European Union in December 2020, which was applied provisionally beginning in January 1, 2021 and entered into force on May 1, 2021. The agreement addresses trade, economic arrangements, law enforcement, judicial cooperation and a governance framework

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including procedures for dispute resolution, among other things. As both parties continue to work on the rules for implementation, significant political and economic uncertainty remains about how the precise terms of the relationship between the parties will differ from the terms before withdrawal.

Since the regulatory framework for pharmaceutical products in the United Kingdom covering the quality, safety, and efficacy of pharmaceutical products, clinical trials, marketing authorization, commercial sales, and distribution of pharmaceutical products is derived from European Union directives and regulations, the consequences of Brexit and the impact the future regulatory regime that applies to products and the approval of product candidates in the United Kingdom remains unclear. As of January 1, 2021, the Medicines and Healthcare products Regulatory Agency, or the MHRA, became responsible for supervising medicines and medical devices in Great Britain, comprising England, Scotland and Wales under domestic law, whereas Northern Ireland will continue to be subject to European Union rules under the Northern Ireland Protocol. The MHRA will rely on the Human Medicines Regulations 2012 (SI 2012/1916) (as amended), or the HMR, as the basis for regulating medicines. The HMR has incorporated into the domestic law of the body of European Union law instruments governing medicinal products that pre-existed prior to the United Kingdom’s withdrawal from the European Union. Any delay in obtaining, or an inability to obtain, any marketing approvals, as a result of Brexit or otherwise, may force us to restrict or delay efforts to seek regulatory approval in the United Kingdom for our product candidates, which could significantly and materially harm our business.

We expect that we will be subject to additional risks in commercializing any of our product candidates that receive marketing approval outside the United States, including tariffs, trade barriers and regulatory requirements; economic weakness, including inflation, or political instability in particular foreign economies and markets; compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations incident to doing business in another country; and workforce uncertainty in countries where labor unrest is more common than in the United States.

The FDA, EMA or other comparable foreign regulatory authorities could require the clearance or approval of a companion diagnostic device as a condition of approval for any product candidate that requires or would commercially benefit from such tests. Failure to successfully validate, develop and obtain regulatory clearance or approval for companion diagnostics on a timely basis or at all could harm our product development strategy and we may not realize the commercial potential of any such product candidate.

If safe and effective use of any of our other product candidates depends on an in vitro diagnostic, then the FDA generally will require approval or clearance of that diagnostic, known as a companion diagnostic, at the same time that the FDA approves our product candidates. The process of obtaining or creating such diagnostic is time consuming and costly. Companion diagnostics, which provide information that is essential for the safe and effective use of a corresponding therapeutic product, are subject to regulation by the FDA, EMA and other comparable foreign regulatory authorities as medical devices and require separate regulatory approval from therapeutic approval prior to commercialization. The FDA previously has required in vitro companion diagnostics intended to select the patients who will respond to a product candidate to obtain pre-market approval, or PMA, simultaneously with approval of the therapeutic candidate. The PMA process, including the gathering of preclinical and clinical data and the submission and review by the FDA, can take several years or longer. It involves a rigorous pre-market review during which the applicant must prepare and provide FDA with reasonable assurance of the device’s safety and effectiveness and information about the device and its components regarding, among other things, device design, manufacturing, and labeling. After a device is placed on the market, it remains subject to significant regulatory requirements, including requirements governing development, testing, manufacturing, distribution, marketing, promotion, labeling, import, export, record-keeping, and adverse event reporting.

Given our limited experience in developing and commercializing diagnostics, we do not plan to develop companion diagnostics internally and thus will be dependent on the sustained cooperation and effort of third-party collaborators in developing and obtaining approval for these companion diagnostics. We may not be able to enter into arrangements with a provider to develop a companion diagnostic for use in connection with a registrational trial for our product candidates or for commercialization of our product candidates, or do so on commercially reasonable terms, which could adversely affect and/or delay the development or commercialization of our product candidates. We and our future collaborators may encounter difficulties in developing and obtaining approval for the companion diagnostics, including issues relating to selectivity/specificity, analytical validation, reproducibility, or clinical validation. Any delay or failure by our collaborators to develop or obtain regulatory approval of the companion

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diagnostics could delay or prevent approval of our product candidates. In addition, we, our collaborators or third parties may encounter production difficulties that could constrain the supply of the companion diagnostics, and both they and we may have difficulties gaining acceptance of the use of the companion diagnostics by physicians.

We believe that adoption of screening and treatment into clinical practice guidelines is important for payer access, reimbursement, utilization in medical practice and commercial success, but both our collaborators and we may have difficulty gaining acceptance of the companion diagnostic into clinical practice guidelines. If such companion diagnostics fail to gain market acceptance, it would have an adverse effect on our ability to derive revenues from sales, if any, of any of our product candidates that are approved for commercial sale. In addition, any companion diagnostic collaborator or third party with whom we contract may decide not to commercialize or to discontinue selling or manufacturing the companion diagnostic that we anticipate using in connection with development and commercialization of our product candidates, or our relationship with such collaborator or third party may otherwise terminate. We may not be able to enter into arrangements with another provider to obtain supplies of an alternative diagnostic test for use in connection with the development and commercialization of our product candidates or do so on commercially reasonable terms, which could adversely affect and/or delay the development or commercialization of our product candidates.

Tazemetostat is, and any other product candidate for which we obtain marketing approval could be, subject to post-marketing restrictions or withdrawal from the market and we may be subject to substantial penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems with our products, when and if any of them are approved.

Tazemetostat and any other product candidate for which we obtain marketing approval, along with the manufacturing processes, post-approval clinical data, labeling, advertising and promotional activities for such product, will be subject to continual requirements of and review by the FDA and other regulatory authorities. These requirements include submissions of safety and other post-marketing information and reports, registration and listing requirements, cGMP requirements relating to manufacturing, quality control, quality assurance and corresponding maintenance of records and documents, requirements regarding the distribution of samples to physicians and recordkeeping. As a condition of accelerated approval, the FDA may require a sponsor to perform post-marketing confirmatory studies to verify and describe the predicted effect on irreversible morbidity or mortality or other clinical endpoint, and the drug may be subject to accelerated withdrawal procedures. The accelerated approval for tazemetostat subjects us to these conditions. Even if marketing approval of a product candidate is granted, the approval may be subject to limitations on the indicated uses for which the product may be marketed or to the conditions of approval, including the requirement to implement a risk evaluation and mitigation strategy. New cancer drugs frequently are indicated only for patient populations that have not responded to an existing therapy or have relapsed. If tazemetostat or any other product candidate that we may develop receives marketing approval, the accompanying label may limit the approved use of our drug in this way, which could limit sales of the product.

The FDA may also impose requirements for costly post-marketing studies or clinical trials and surveillance to monitor the safety or efficacy of the product for any approved indication. The FDA and other agencies, including the Department of Justice, or the DOJ, closely regulate and monitor the post-approval marketing and promotion of drugs to ensure they are marketed and distributed only for the approved indications and in accordance with the provisions of the approved labeling. The FDA and DOJ impose stringent restrictions on manufacturers’ communications regarding off-label use, and if we do not market our products for their approved indications, we may be subject to enforcement action for off-label marketing. Violations of the Federal Food, Drug, and Cosmetic Act and other statutes, including the False Claims Act, relating to the promotion and advertising of prescription drugs may lead to investigations and enforcement actions alleging violations of federal and state health care fraud and abuse laws, as well as state consumer protection laws.

In addition, later discovery of previously unknown adverse events or other problems with our products, manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may yield various results, including:

•restrictions on such products, manufacturers or manufacturing processes;

•restrictions on the labeling or marketing of a product;

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•restrictions on product distribution or use;

•requirements to conduct post-marketing studies or clinical trials;

•warning letters or untitled letters;

•withdrawal of the products from the market;

•refusal to approve pending applications or supplements to approved applications that we submit;

•recall of products;

•fines, restitution or disgorgement of profits or revenues;

•suspension or withdrawal of marketing approvals;

•damage to relationships with any potential collaborators;

•unfavorable press coverage and damage to our reputation;

•refusal to permit the import or export of our products;

•product seizure;

•injunctions or the imposition of civil or criminal penalties; or

•litigation involving patients using our products.

We conduct a substantial portion of our clinical trials in the EU. Non-compliance with EU and UK requirements regarding safety monitoring or pharmacovigilance, and with requirements related to the development of products for the pediatric population, can also result in significant financial penalties.

If our drug product candidates or any of our future drug product candidates obtain regulatory approval, additional competitors could enter the market with generic versions of such products, which may result in a material decline in sales of our competing products.

Under the Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Amendments to the Federal Food, Drug, and Cosmetic Act, or the FDCA, a company may file an abbreviated new drug application, or ANDA, seeking approval of a generic version of an approved innovator product. Under the Hatch-Waxman Amendments, a company may also submit an NDA under section 505(b)(2) of the FDCA that references the FDA’s prior approval of the innovator product or preclinical studies and/or clinical trials that were not conducted by, or for, the applicant and for which the applicant has not obtained a right of reference. A 505(b)(2) NDA product may be for a new or improved version of the original innovator product. The Hatch-Waxman Amendments also provide for certain periods of regulatory exclusivity, which preclude FDA approval (or in some circumstances, FDA filing and review) of an ANDA or 505(b)(2) NDA.

In addition to the benefits of regulatory exclusivity, an innovator NDA holder may have patents claiming the active ingredient, product formulation or an approved use of the drug, which would be listed with the product in the FDA publication “Approved Drug Products with Therapeutic Equivalence Evaluations,” known as the Orange Book. If there are patents listed in the Orange Book for the applicable, approved innovator product, a generic or 505(b)(2) applicant that seeks to market its product before expiration of the patents must include in their applications what is known as a “Paragraph IV” certification, challenging the validity or enforceability, or claiming non-infringement, of the listed patent or patents. Notice of the certification must be given to the patent owner and NDA holder and if, within 45 days of receiving notice, either the patent owner or NDA holder sues for patent infringement, approval of the ANDA or 505(b)(2) NDA is stayed for up to 30 months.

Accordingly, if any of our product candidates that are regulated as drugs are approved, competitors could file ANDAs for generic versions of these products or 505(b)(2) NDAs that reference our products. If there are patents listed for such drug products in the Orange Book, those ANDAs and 505(b)(2) NDAs would be required to include a certification as to each listed patent indicating whether the ANDA applicant does or does not intend to challenge the patent. We cannot predict which, if any, patents in our current portfolio or patents we may obtain in the future will

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be eligible for listing in the Orange Book, how any generic competitor would address such patents, whether we would sue on any such patents or the outcome of any such suit.

We may not be successful in securing or maintaining proprietary patent protection for products and technologies we develop or license, despite expending a significant amount of resources that could have been focused on other areas of our business. Moreover, if any of our owned or in-licensed patents that are listed in the Orange Book are successfully challenged by way of a Paragraph IV certification and subsequent litigation, the affected product could immediately face generic competition and its sales would likely decline rapidly and materially.

Enacted legislation and future legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and affect the prices we may obtain.

In the United States and some foreign jurisdictions, there have been a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could prevent or delay marketing approval of our product candidates, restrict or regulate post-approval activities and affect our ability to profitably sell any product candidates for which we obtain marketing approval. In the United States, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, or the MMA, changed the way Medicare covers and pays for pharmaceutical products. The legislation expanded Medicare coverage for drug purchases by the elderly and introduced a new reimbursement methodology based on average sales prices for physician-administered drugs. In addition, this legislation provided authority for limiting the number of drugs that will be covered in any therapeutic class. Cost reduction initiatives and other provisions of this legislation could decrease the coverage and price that we receive for any approved products. While the MMA applies only to drug benefits for Medicare beneficiaries, private payors often follow Medicare coverage policy and payment limitations in setting their own reimbursement rates. Therefore, any reduction in reimbursement that results from the MMA may result in a similar reduction in payments from private payors.

In March 2010, the U.S. Congress passed the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act, or collectively, the PPACA, a sweeping law which included changes to the coverage and reimbursement of drug products under government healthcare programs. Among the provisions of the PPACA of importance to tazemetostat and to our potential product candidates are the following:

•an annual, nondeductible fee on any entity that manufactures or imports specified branded prescription drugs and biologic agents;

•an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program;

•expansion of healthcare fraud and abuse laws, including the False Claims Act and the Anti-Kickback Statute, new government investigative powers, and enhanced penalties for noncompliance;

•a Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated prices;

•extension of manufacturers’ Medicaid rebate liability;

•expansion of eligibility criteria for Medicaid programs;

•expansion of the entities eligible for discounts under the Public Health Service pharmaceutical pricing program;

•requirements to report financial arrangements with physicians and teaching hospitals;

•a requirement to annually report drug samples that manufacturers and distributors provide to physicians; and

•a Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.

In addition, other legislative changes have been proposed and adopted since the ACA was enacted. In August 2011, the Budget Control Act of 2011, among other things, created measures for spending reductions by Congress. A Joint

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Select Committee on Deficit Reduction, tasked with recommending a targeted deficit reduction of at least $1.2 trillion for the years 2013 through 2021, was unable to reach required goals, thereby triggering the legislation’s automatic reduction to several government programs. These changes included aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2031 under the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act. Pursuant to subsequent legislation, however, these Medicare sequester reductions have been suspended through the end of March 2022. From April 2022 through June 2022 a 1% sequester cut will be in effect, with the full 2% cut resuming thereafter. The American Taxpayer Relief Act of 2012, among other things, reduced Medicare payments to several providers 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 and otherwise affect the prices we may obtain for any of our products or product candidates for which we may obtain regulatory approval or the frequency with which any such product is prescribed or used.

Since enactment of the ACA, there have been and continue to be, numerous legal challenges and Congressional actions to repeal and replace provisions of the law. For example, with enactment of the Tax Cuts for Jobs Act, or TCJA, in 2017, Congress repealed the “individual mandate.” The repeal of this provision, which requires most Americans to carry a minimal level of health insurance, became effective in 2019. Further, on December 14, 2018, a U.S. District Court judge in the Northern District of Texas ruled that the individual mandate portion of the ACA is an essential and inseverable feature of the ACA and therefore because the mandate was repealed as part of the TCJA, the remaining provisions of the ACA are invalid as well. The U.S. Supreme Court heard this case on November 10, 2020 and on June 17, 2021, dismissed this action after finding that the plaintiffs do not have standing to challenge the constitutionality of the ACA. Litigation and legislation over the ACA are likely to continue, with unpredictable and uncertain results.

The Trump Administration also took executive actions to undermine or delay implementation of the ACA, including directing federal agencies with authorities and responsibilities under the ACA to waive, defer, grant exemptions from or delay the implementation of any provision of the ACA that would impose a fiscal or regulatory burden on states, individuals, healthcare providers, health insurers or manufacturers of pharmaceuticals or medical devices. On January 28, 2021, however, President Biden revoked those Orders and issued a new Executive Order which directs federal agencies to reconsider rules and other policies that limit Americans’ access to health care and consider actions that will protect and strengthen that access. Under this Order, federal agencies are directed to re-examine: policies that undermine protections for people with pre-existing conditions, including complications related to COVID-19; demonstrations and waivers under Medicaid and the ACA that may reduce coverage or undermine the programs, including work requirements; policies that undermine the Health Insurance Marketplace or other markets for health insurance; policies that make it more difficult to enroll in Medicaid and the ACA; and policies that reduce affordability of coverage or financial assistance, including for dependents.

We expect that these healthcare reforms, as well as other healthcare reform measures that may be adopted in the future, may result in additional reductions in Medicare and other healthcare funding, more rigorous coverage criteria, new payment methodologies and additional downward pressure on the price that we receive for any approved product and/or the level of reimbursement physicians receive for administering any approved product we might bring to market. Reductions in reimbursement levels may negatively impact the prices we receive or the frequency with which our products are prescribed or administered. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors. Accordingly, such reforms, if enacted, could have an adverse effect on anticipated revenue from any product or product candidate that we may successfully develop and for which we may obtain marketing approval and may affect our overall financial condition and ability to develop or commercialize any product or product candidate.

Current and future legislative efforts may limit the prices for our products, if and when they are licensed for marketing, and that could materially impact our ability to generate revenues.

The prices of prescription pharmaceuticals have also been the subject of considerable discussion in the United States. There have been several recent U.S. congressional inquiries, as well as proposed and enacted state and federal legislation designed to, among other things, bring more transparency to pharmaceutical pricing, review the relationship between pricing and manufacturer patient programs, and reduce the costs of pharmaceuticals under

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Medicare and Medicaid. In 2020, President Trump issued several executive orders intended to lower the costs of prescription products and certain provisions in these orders have been incorporated into regulations. These regulations include an interim final rule implementing a most favored nation model for prices that would tie Medicare Part B payments for certain physician-administered pharmaceuticals to the lowest price paid in other economically advanced countries, effective January 1, 2021. That rule, however, has been subject to a nationwide preliminary injunction and, on December 29, 2021, CMS issued a final rule to rescind it. With issuance of this rule, CMS stated that it will explore all options to incorporate value into payments for Medicare Part B pharmaceuticals and improve beneficiaries' access to evidence-based care.

In addition, in October 2020, HHS and the FDA published a final rule allowing states and other entities to develop a Section 804 Importation Program, or SIP, to import certain prescription drugs from Canada into the United States. The final rule is currently the subject of ongoing litigation, but at least six states (Vermont, Colorado, Florida, Maine, New Mexico, and New Hampshire) have passed laws allowing for the importation of drugs from Canada with the intent of developing SIPs for review and approval by the FDA. Further, on November 20, 2020, 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 new safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers, the implementation of which have also been delayed by the Biden administration until January 1, 2023.

On July 9, 2021, President Biden signed Executive Order 14063, which focuses on, among other things, the price of pharmaceuticals. The Order directs the Department of Health and Human Services, or HHS, to create a plan within 45 days to combat “excessive pricing of prescription pharmaceuticals and enhance domestic pharmaceutical supply chains, to reduce the prices paid by the federal government for such pharmaceuticals, and to address the recurrent problem of price gouging.” On September 9, 2021, HHS released its plan to reduce pharmaceutical prices. The key features of that plan are to: (a) make pharmaceutical prices more affordable and equitable for all consumers and throughout the health care system by supporting pharmaceutical price negotiations with manufacturers; (b) improve and promote competition throughout the prescription pharmaceutical industry by supporting market changes that strengthen supply chains, promote biosimilars and generic drugs, and increase transparency; and (c) foster scientific innovation to promote better healthcare and improve health by supporting public and private research and making sure that market incentives promote discovery of valuable and accessible new treatments.

At the state level, individual states are increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. In addition, regional healthcare organizations and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs. These measures could reduce the ultimate demand for our products, once approved, or put pressure on our product pricing. We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures.

Our relationships with healthcare providers and third-party payors are subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which, in the event of a violation, could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings.

Healthcare providers and third-party payors play a primary role in the recommendation and prescription of TAZVERIK and will play a primary role in the recommendation and prescription of any future product candidates for which we obtain marketing approval. Our current and future arrangements with healthcare providers and third-party payors may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which we market, sell and distribute

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any products for which we obtain marketing approval. Restrictions under applicable federal and state healthcare laws and regulations include the following:

•the federal Anti-Kickback Statute prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation or arranging of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid. Several courts have interpreted the statute’s intent requirement to mean that if any one purpose of arrangement involving remuneration is to induce referrals of a federal healthcare covered business, the statue has been violated. In addition, the PPACA, amended the intent requirement of the federal Anti-Kickback Statute such that a person or entity no longer needs to have actual knowledge of the statute or specific intent to violate it to have committed a violation. The Anti-Kickback Statute is broad and prohibits many arrangements and practices that are lawful in businesses outside of the healthcare industry. Penalties for violations of the federal Anti-Kickback Statute include criminal penalties and civil sanctions such as fines, imprisonment and possible exclusion from Medicare, Medicaid and other federal healthcare programs;

•the federal False Claims Act imposes criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for, among other things, knowingly presenting, or causing to be presented, false or fraudulent claims for payment by a federal healthcare program or making a false statement or record material to payment of a false claim or avoiding, decreasing or concealing an obligation to pay money to the federal government, with potential liability including mandatory treble damages and significant per-claim penalties, currently set at a minimum of $11,665 and a maximum of $23,331 per false claim;

•the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters;

•HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act and its implementing regulations, also imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information;

•the federal Physician Payments Sunshine Act requires applicable manufacturers of covered drugs to report payments and other transfers of value to physicians, other healthcare providers and teaching hospitals; and

•analogous state laws and regulations, such as state anti-kickback and false claims laws and transparency statutes, may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers.

Some state laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures.

The provision of benefits or advantages to physicians to induce or encourage the prescription, recommendation, endorsement, purchase, supply, order or use of medicinal products is also prohibited in the EU. The provision of benefits or advantages to physicians is governed by the national anti-bribery laws of EU Member States, and, in the UK, the U.K. Bribery Act 2010. Infringement of these laws could result in substantial fines and imprisonment.

Payments made to physicians in certain EU Member States must be publicly disclosed. Moreover, agreements with physicians often must be the subject of prior notification and approval by the physician’s employer, his or her competent professional organization and/or the regulatory authorities of the individual EU Member States. These requirements are provided in the national laws, industry codes or professional codes of conduct applicable in the EU Member States. Failure to comply with these requirements could result in reputational risk, public reprimands, administrative penalties, fines or imprisonment.

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In order to comply with these laws, we have implemented a compliance program to actively identify, prevent and mitigate risk through the implementation of compliance policies and systems and by promoting a culture of compliance. Although we take our obligation to maintain our compliance with these various laws and regulations seriously and our compliance program is designed to prevent the violation of these laws and regulations, we cannot guarantee that our compliance program will be sufficient or effective, that we will be able to integrate the operations of acquired businesses into our compliance program on a timely basis, that our employees will comply with our policies and that our employees will notify us of any violation of our policies, that we will have the ability to take appropriate and timely corrective action in response to any such violation, or that we will make decisions and take actions that will necessarily limit or avoid liability for whistleblower claims that individuals, such as employees or former employees, may bring against us or that governmental authorities may prosecute against us based on information provided by individuals. If we are found to be in violation of any of the laws and regulations described above or other applicable federal, state and foreign healthcare laws, we may be subject to penalties, including civil, criminal and administrative penalties, damages, fines, disgorgement, contractual damages, reputational harm, imprisonment, diminished profits and future earnings, exclusion from government healthcare reimbursement programs, 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/or the curtailment or restructuring of our operations, any of which could have a material adverse effect on our business, results of operations and growth prospects. Any action against us for violation of these laws or regulations, 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. Moreover, achieving and sustaining compliance with applicable federal, state and foreign healthcare laws is costly and time-consuming for our management.

Reporting and payment obligations under the Medicaid Drug Rebate Program and other governmental drug pricing programs are complex and may involve subjective decisions. Any failure to comply with those obligations could subject us to penalties and sanctions.

As a condition of reimbursement by various federal and state health insurance programs, pharmaceutical companies are required to calculate and report certain pricing information to federal and state agencies. The regulations governing the calculations, price reporting and payment obligations are complex and subject to interpretation by various government and regulatory agencies, as well as the courts. Reasonable assumptions have been made where there is lack of regulations or clear guidance and such assumptions involve subjective decisions and estimates. Pharmaceutical companies are required to report any revisions to our calculation, price reporting and payment obligations previously reported or paid. Such revisions could affect liability to federal and state payers and also adversely impact reported financial results of operations in the period of such restatement.

Uncertainty exists as new laws, regulations, judicial decisions, or new interpretations of existing laws, or regulations related to our calculations, price reporting or payments obligations increases the chances of a legal challenge, restatement or investigation. If a company becomes subject to investigations, restatements, or other inquiries concerning compliance with price reporting laws and regulations, it could be required to pay or be subject to additional reimbursements, penalties, sanctions or fines, which could have a material adverse effect on the business, financial condition and results of operations. In addition, it is possible that future healthcare reform measures could be adopted, which could result in increased pressure on pricing and reimbursement of products and thus have an adverse impact on financial position or business operations.

Further, state Medicaid programs may be slow to invoice pharmaceutical companies for calculated rebates resulting in a lag between the time a sale is recorded and the time the rebate is paid. This results in a company having to carry a liability on its consolidated balance sheets for the estimate of rebate claims expected for Medicaid patients. If actual claims are higher than current estimates, the company’s financial position and results of operations could be adversely affected.

In addition to retroactive rebates and the potential for 340B Program refunds, if a pharmaceutical firm is found to have knowingly submitted any false price information related to the Medicaid Drug Rebate Program to the Centers for Medicare & Medicaid Services (“CMS”), it may be liable for civil monetary penalties. Such failure could also be

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grounds for CMS to terminate the Medicaid drug rebate agreement, pursuant to which companies participate in the Medicaid program. In the event that CMS terminates a rebate agreement, federal payments may not be available under government programs, including Medicaid or Medicare Part B, for covered outpatient drugs.

Additionally, if a pharmaceutical company overcharges the government in connection with the FSS program or Tricare Retail Pharmacy Program, whether due to a misstated Federal Ceiling Price or otherwise, it is required to refund the difference to the government. Failure to make necessary disclosures and/or to identify contract overcharges can result in allegations against a company under the FCA and other laws and regulations. Unexpected refunds to the government, and responding to a government investigation or enforcement action, would be expensive and time-consuming, and could have a material adverse effect on our business, financial condition, results of operations and growth prospects.

Our collaborators are also subject to similar requirements outside of the U.S. and thus the attendant risks and uncertainties. If our collaborators suffer material and adverse effects from such risks and uncertainties, our rights and benefits for our licensed products could be negatively impacted, which could have a material and adverse impact on our revenues.

Compliance with global privacy and data security requirements could result in additional costs and liabilities to us or inhibit our ability to collect and process data globally, and the failure to comply with such requirements could subject us to significant fines and penalties, which may have a material adverse effect on our business, financial condition or results of operations.

The regulatory framework for the collection, use, safeguarding, sharing, transfer and other processing of information worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future. Globally, virtually every jurisdiction in which we operate has established its own data security and privacy frameworks with which we must comply. For example, the collection, use, disclosure, transfer, or other processing of personal data regarding individuals in the European Union, including personal health data, is subject to the EU General Data Protection Regulation, or the GDPR, which took effect across all member states of the European Economic Area, or EEA, in May 2018. The GDPR is wide-ranging in scope and imposes numerous requirements on companies that process personal data, including strict rules on the transfer of personal data to countries outside the European Union, including the United States.

As a result, there is increased scrutiny on the extent to which clinical trial sites located in the EEA should apply the GPDR to transfers of personal data from such sites to countries that are considered to lack an adequate level of data protection, such as the United States. The GDPR also permits data protection authorities to require destruction of improperly gathered or used personal information and/or impose substantial fines for violations of the GDPR, which can be up to four percent of global revenues or 20 million Euros, whichever is greater, and it also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR. In addition, the GDPR provides that European Union member states may make their own further laws and regulations limiting the processing of personal data, including genetic, biometric or health data.

Similar actions are either in place or under way in the United States. There are a broad variety of data protection laws that are applicable to our activities, and a wide range of enforcement agencies at both the state and federal levels that can review companies for privacy and data security concerns based on general consumer protection laws. The Federal Trade Commission and state Attorneys General all are aggressive in reviewing privacy and data security protections for consumers. New laws also are being considered at both the state and federal levels. For example, the California Consumer Privacy Act—which went into effect on January 1, 2020—is creating similar risks and obligations as those created by GDPR, though the Act does exempt certain information collected as part of a clinical trial subject to the Federal Policy for the Protection of Human Subjects (the Common Rule). Many other states are considering similar legislation. A broad range of legislative measures also have been introduced at the federal level. Accordingly, failure to comply with federal and state laws (both those currently in effect and future legislation) regarding privacy and security of personal information could expose us to fines and penalties under such laws. There also is the threat of consumer class actions related to these laws and the overall protection of personal data. Even if we are not determined to have violated these laws, government investigations into these issues

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typically require the expenditure of significant resources and generate negative publicity, which could harm our reputation and our business.

Given the breadth and depth of changes in data protection obligations, preparing for and complying with such requirements is rigorous and time intensive and requires significant resources and a review of our technologies, systems and practices, as well as those of any third-party collaborators, service providers, contractors or consultants that process or transfer personal data collected in the European Union. The GDPR and other changes in laws or regulations associated with the enhanced protection of certain types of sensitive data, such as healthcare data or other personal information from our clinical trials, could require us to change our business practices and put in place additional compliance mechanisms, may interrupt or delay our development, regulatory and commercialization activities and increase our cost of doing business, and could lead to government enforcement actions, private litigation and significant fines and penalties against us and could have a material adverse effect on our business, financial condition or results of operations.

We are subject to U.S. and foreign anti-corruption and anti-money laundering laws with respect to our operations and non-compliance with such laws can subject us to criminal and/or civil liability and harm our business.

We are subject to the U.S. Foreign Corrupt Practices Act of 1977, as amended, or the FCPA, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, the USA PATRIOT Act, and other state and national anti-bribery and anti-money laundering laws in countries in which we conduct activities. Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, third-party intermediaries, joint venture partners and collaborators from authorizing, promising, offering, or providing, directly or indirectly, improper payments or benefits to recipients in the public or private sector. We may have direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals, universities, and other organizations. In addition, we may engage third party intermediaries to coordinate our clinical research activities abroad and/or to obtain necessary permits, licenses, and other regulatory approvals. We can be held liable for the corrupt or other illegal activities of these third-party intermediaries, our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize or have actual knowledge of such activities.

We have adopted a Code of Business Conduct and Ethics that mandates compliance with the FCPA and other anti-corruption laws applicable to our business throughout the world. We cannot ensure, however, that our employees and third party intermediaries will comply with this code or such anti-corruption laws. Noncompliance with anti-corruption and anti-money laundering laws could subject us to whistleblower complaints, investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension and/or debarment from contracting with certain persons, the loss of export privileges, reputational harm, adverse media coverage, and other collateral consequences. If any subpoenas, investigations, or other enforcement actions are launched, or governmental or other sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, our business, results of operations and financial condition could be materially harmed. In addition, responding to any such action will likely result in a materially significant diversion of management's attention and resources and significant defense and compliance costs and other professional fees. In certain cases, enforcement authorities may even cause us to appoint an independent compliance monitor which can result in added costs and administrative burdens.

If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could harm our business.

We are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the handling, use, storage, treatment and disposal of hazardous materials and wastes. Our operations involve the use of hazardous and flammable materials, including chemicals and biological materials. Our operations also produce hazardous waste products. We generally contract with third parties for the disposal of these materials and wastes. We cannot eliminate the risk of contamination or injury from these materials. In the event of contamination or injury resulting from our use of hazardous materials, we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costs associated with civil or criminal fines and penalties for failure to comply with such laws and regulations.

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Although we maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. We do not maintain insurance for environmental liability or toxic tort claims that may be asserted against us in connection with our storage or disposal of biological, hazardous or radioactive materials.

In addition, we may incur substantial costs in order to comply with current or future environmental, health and safety laws and regulations. These current or future laws and regulations may impair our research, development or production efforts. Our failure to comply with these laws and regulations also may result in substantial fines, penalties or other sanctions.

Our internal information systems, or those of any collaborators, contractors, consultants, vendors, business partners or other third parties, may fail or suffer security breaches, which could result in a material disruption of our product development programs.

We collect, store and transmit large amounts of confidential information, including personal information and information relating to intellectual property, on internal information systems and through the information systems of our collaborators, contractors, consultants, vendors, business partners or other third parties.

Despite the ongoing implementation of security measures, our internal information systems and those of third parties are vulnerable to damage from computer viruses, malware, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures. Such systems are also vulnerable to service interruptions or to security breaches from inadvertent or intentional actions by our employees, our collaborators, contractors, consultants, vendors, business partners and other third parties, or from cyberattacks by malicious third parties over the Internet or through other mechanisms. Cyberattacks are increasing in their frequency, sophistication and intensity, and have become increasingly difficult to detect. Cyberattacks could include the deployment of harmful malware, ransomware, denial of service attacks, social engineering and other means to affect service reliability and threaten the confidentiality, integrity and availability of information. Cyberattacks also could include phishing attempts or e-mail fraud to cause payments or information to be transmitted to an unintended recipient. Our employees and systems have been and likely will continue to be targeted by such cyberattacks.

While we have not experienced any material system failure, accident, cyber-attack or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our development programs, clinical trials and business operations, whether due to a loss of our trade secrets or other proprietary information or other similar disruptions, in addition to possibly requiring substantial expenditures of resources to remedy. In addition, our remediation efforts may not be successful. For example, the loss of clinical trial data from clinical trials could result in delays or termination of our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. In addition, as risks with respect to our information systems continue to evolve, we will incur additional costs to maintain the security of our information systems and comply with evolving laws and regulations pertaining to cybersecurity and related areas. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability, including regulatory fines and other losses with respect to privacy claims, enrollment in our clinical trials could be negatively affected, our competitive position and reputation could be harmed and the further development and commercialization of our product candidates could be delayed. While we maintain cybersecurity insurance, our insurance may be insufficient to cover all liabilities incurred by these incidents, and any incidents may result in loss of, or increased costs of, our cybersecurity insurance.

Risks Related to Employee Matters and Managing 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 research and development, clinical and business expertise of our executive officers as well as the other principal members of our management, scientific and clinical teams. Although we have entered into employment letter agreements with our executive officers, each of them may terminate their employment with

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us at any time. For instance, since January 1, 2017, we have had multiple executive officers, including among others our former Executive Vice President and Chief Financial Officer, our former Chief Business Officer, our former President of Research and Chief Scientific Officer, and our former Executive Vice President and Chief Medical Officer terminate their employment with us. We do not maintain “key person” insurance for any of our executives or other employees.

Recruiting and retaining qualified scientific, clinical, manufacturing, regulatory, and sales and marketing personnel will also be critical to our success. We have conducted two restructurings since June 30, 2021 involving the termination of many employees. Given the potential impact on employee morale of, and disruption caused by, the restructuring and in light of the increasingly competitive job market for companies such as ours, we may not be able to retain our employees. The loss of the services of our executive officers or other key employees could impede the achievement of our research, 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, universities and research institutions for similar personnel. In addition, we rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our research and 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 an adequate number of high quality personnel, our ability to pursue our growth strategy will be limited.

In the future we may need to expand our development, regulatory, sales, marketing and distribution capabilities. If and when we expand such capabilities, we may encounter difficulties in managing our growth, which could disrupt our operations.

In the future we may need to grow the number of employees and the scope of our operations, particularly in the areas of drug development, regulatory affairs and, sales, marketing and distribution. If and when we experience such growth, we will be required 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 growth, if and when we determine to grow the number of our employees and the scope of our operations, we may not be able to effectively manage the expansion of our operations or recruit and train additional qualified personnel. Any such 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.

Risks Related to Our Common Stock

Provisions in our corporate charter documents, under Delaware law and in our collaboration agreements could make an acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.

Provisions in our certificate of incorporation, our bylaws and our collaboration agreements may discourage, delay or prevent a merger, acquisition or other change in control of our company that stockholders may consider favorable, including transactions in which stockholders might otherwise receive a premium for their shares. These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock, thereby depressing the market price of our common stock. In addition, because our board of directors is responsible for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors. Among other things, these provisions:

•establish a classified board of directors such that only one of three classes of directors is elected each year;

•allow the authorized number of our directors to be changed only by resolution of our board of directors;

•limit the manner in which stockholders can remove directors from our board of directors;

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•establish advance notice requirements for stockholder proposals that can be acted on at stockholder meetings and nominations to our board of directors;

•require that stockholder actions must be effected at a duly called stockholder meeting and prohibit actions by our stockholders by written consent;

•limit who may call stockholder meetings;

•authorize our board of directors to issue preferred stock without stockholder approval, which could be used to institute a “poison pill” that would work to dilute the stock ownership of a potential hostile acquirer, effectively preventing acquisitions that have not been approved by our board of directors; and

•require the approval of the holders of at least 75% of the votes that all our stockholders would be entitled to cast to amend or repeal specified provisions of our certificate of incorporation or bylaws.

Moreover, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which prohibits a person who owns in excess of 15% of our outstanding voting stock from merging or combining with us for a period of three years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner.

An active trading market for our common stock may not be sustained.

Although our common stock is listed on The Nasdaq Global Select Market, an active trading market for our shares may not be sustained. If an active market for our common stock does not continue, it may be difficult for our stockholders to sell their shares without depressing the market price for the shares or sell their shares at all. Any inactive trading market for our common stock may also impair our ability to raise capital to continue to fund our operations by selling shares and may impair our ability to acquire other companies or technologies by using our shares as consideration.

The price of our common stock has been and may in the future be volatile and fluctuate substantially.

Our stock price has been and may in the future be volatile. The stock market in general and the market for smaller biopharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. From January 1, 2019 until February 15, 2022, the sale price of our common stock as reported on the Nasdaq Global Select Market ranged from a high of $27.82 to a low of $1.01. The market price for our common stock may be influenced by many factors, including:

•revenue related to TAZVERIK;

•regulatory developments with respect to tazemetostat;

•the success of competitive products or technologies;

•results of clinical trials of our product candidates or those of our competitors;

•regulatory or legal developments in the United States and other countries with respect to our product candidates;

•developments or disputes concerning patent applications, issued patents or other proprietary rights;

•the recruitment or departure of key personnel;

•the level of expenses related to any of our products, product candidates or clinical development programs;

•the results of our efforts to discover, develop, acquire or in-license additional product candidates or products;

•actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts;

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•variations in our financial results or the financial results of companies that are perceived to be similar to us;

•changes in the structure of healthcare payment systems;

•market conditions in the pharmaceutical and biotechnology sectors;

•general economic, industry and market conditions;

•disruptions in the financial markets caused by the COVID-19 pandemic; and

•the other factors described in this Risk Factors section.

We have broad discretion over the use of our cash and cash equivalents and may not use them effectively.

Subject to certain restrictions in our Amended and Restated Loan Agreement documents or in other third-party agreements we may enter into from time to time, our management has broad discretion to use our cash and cash equivalents to fund our operations and could spend these funds in ways that do not improve our results of operations or enhance the value of our common stock. The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the price of our common stock to decline, delay the development of our product candidates, or adversely impact the success of our commercialization efforts with respect to TAZVERIK. Pending their use to fund operations, we may invest our cash and cash equivalents in a manner that does not produce income or that loses value.

Changes in tax laws or in their implementation or interpretation could adversely affect our business and financial condition.

Changes in tax law may adversely affect our business or financial condition. The Tax Cuts and Jobs Act of 2017, or the TCJA, as amended by the CARES Act, significantly revised the Internal Revenue Code of 1986, as amended, or the Code. The TCJA, among other things, contained significant changes to corporate taxation, including a reduction of the corporate tax rate from a top marginal rate of 35% to a flat rate of 21%, the limitation of the tax deduction for interest expense to 30% of adjusted taxable income (except for certain small businesses), the limitation of the deduction for net operating losses arising in taxable years beginning after December 31, 2017 to 80% of current year taxable income and elimination of net operating loss carrybacks for losses arising in taxable years ending after December 31, 2017 (though any such net operating losses may be carried forward indefinitely and such net operating losses arising in taxable years beginning before January 1, 2021 are generally eligible to be carried back up to five years), the imposition of a one-time taxation of offshore earnings at reduced rates regardless of whether they are repatriated, the elimination of U.S. tax on foreign earnings (subject to certain important exceptions), the allowance of immediate deductions for certain new investments instead of deductions for depreciation expense over time, and the modification or repeal of many business deductions and credits. In addition to the CARES Act, as part of Congress’ response to the COVID-19 pandemic, economic relief legislation has been enacted in 2020 and 2021 containing numerous tax provisions.

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Regulatory guidance under the TCJA and such additional legislation is and continues to be forthcoming, and such guidance could ultimately increase or lessen impact of these laws on our business and financial condition. Also, as a result of the changes in the U.S. presidential administration and control of the U.S. Senate in 2021, additional tax legislation may be enacted; any such additional legislation could have an impact on us. In addition, it is uncertain if and to what extent various states will conform to the TCJA and additional tax legislation.

We incur significant costs as a result of operating as a public company, and our management is required to devote substantial time to compliance initiatives and corporate governance practices.

As a public company, we incur significant legal, accounting and other expenses. The Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of The Nasdaq Global Select Market and other applicable securities rules and regulations impose various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices. Our management and other personnel will need to continue to devote a substantial amount of time to these compliance initiatives.

We cannot predict or estimate the amount of costs we may incur to continue to operate as a public company, nor can we predict the timing of such costs. These rules and regulations are often subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies which could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, we are required to furnish a report by our management on our internal control over financial reporting. We are also required to include an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. To achieve compliance with Section 404 within the prescribed period, we are engaged in a process to document and evaluate our internal control over financial reporting, which is both costly and challenging. In this regard, we have and will need to continue to dedicate internal resources, engage outside consultants and adopt a detailed work plan to assess and document the adequacy of internal control over financial reporting, continue steps to improve control processes as appropriate, validate through testing that controls are functioning as documented and implement a continuous reporting and improvement process for internal control over financial reporting. If we or our auditors identify one or more material weaknesses, it could result in an adverse reaction in the financial markets due to a loss of confidence in the reliability of our financial statements.

Because we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation, if any, will be the sole source of gain for our stockholders.

We have never declared or paid cash dividends on our capital stock. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. The terms of our Amended and Restated Loan Agreement restrict our ability to pay dividends. In addition, the terms of any future debt agreements may preclude us from paying dividends. As a result, capital appreciation, if any, of our common stock will be the sole source of gain for our stockholders for the foreseeable future.

If securities or industry analysts do not continue to publish research or publish inaccurate or unfavorable research about our business, our share price and trading volume could decline.

The trading market for our common stock may be impacted, in part, by the research and reports that securities or industry analysts publish about us or our business. There can be no assurance that analysts will cover us, continue to cover us or provide favorable coverage. If one or more analysts downgrade our stock or change their opinion of our stock, our share price may decline. In addition, if one or more analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.

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There is no public market for our series A convertible preferred stock.

There is no established public trading market for our series A convertible preferred stock, and we do not expect a market to develop. In addition, we do not intend to apply for listing of the series A convertible preferred stock on any national securities exchange or other nationally recognized trading system. Without an active market, the liquidity of the series A convertible preferred stock will be limited.

General Risk Factors

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

We are exposed to the risk of fraud or other misconduct by our employees, independent contractors, CROs, consultants, commercial partners, vendors and, pertaining to clinical trials, our principal investigators. Misconduct by these parties could include intentional failures to comply with FDA regulations or the regulations applicable in the European Union and other jurisdictions, provide accurate information to the FDA, the European Commission and other regulatory authorities, comply with healthcare fraud and abuse laws and regulations in the United States and abroad, report financial information or data accurately, or disclose unauthorized activities to us. In particular, sales, marketing and business arrangements in the healthcare industry are subject to extensive laws and regulations intended to prevent fraud, misconduct, kickbacks, self-dealing and other abusive practices. These laws and regulations restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements.

Such misconduct also could involve the improper use of information obtained in the course of clinical trials or interactions with the FDA or other regulatory authorities, which could result in regulatory sanctions and cause serious harm to our reputation. We have adopted a code of conduct applicable to all of our employees, but it is not always possible to identify and deter misconduct, and the precautions we take to detect and prevent such activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from government investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations. If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, financial condition, results of operations and prospects, including the imposition of significant fines or other sanctions.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

Our headquarters are located in Cambridge, Massachusetts, where we occupy approximately 43,066 square feet of office and laboratory space. The term of the lease to our Cambridge headquarters expires November 30, 2024. In addition, we occupy an additional 33,525 square feet in Cambridge, Massachusetts. The term of this lease ends on March 31, 2027, but we have an option to extend the term for one additional five-year period.

Item 3. Legal Proceedings

We are not currently a party to any material legal proceedings.

Item 4. Mine Safety Disclosures

Not applicable.

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PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our common stock is traded on the Nasdaq Global Select Market under the symbol “EPZM.” Trading of our common stock commenced on May 31, 2013, following the completion of our initial public offering. Prior to that date, there was no public market for our common stock.

Holders

As of February 15, 2022, there were 12 holders of record of our common stock. This number does not include beneficial owners whose shares are held in street name.

Dividends

We have never declared or paid cash dividends on our capital stock. We intend to retain all of our future earnings, if any, to finance the growth and development of our business. The terms of our Amended and Restated Loan Agreement with BPCR Limited Partnership (as transferee of BioPharma Credit Investments V (Master) LP’s interest as a lender) and BioPharma Credit PLC, or the Amended and Restated Loan Agreement, restrict our ability to pay dividends. We do not intend to pay cash dividends to our stockholders in the foreseeable future.

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Stock Performance Graph

The following graph shows a comparison from December 31, 2016 through December 31, 2021 of the cumulative total return on an assumed investment of $100.00 in cash in our common stock, the Nasdaq Composite Index and the NASDAQ Biotechnology Index. Such returns are based on historical results and are not intended to suggest future performance. Data for the NASDAQ Composite Index and NASDAQ Biotechnology Index assume reinvestment of dividends.

 

The performance graph in this Item 5 is not deemed to be “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities under that Section, and shall not be deemed incorporated by reference into any of our filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent we specifically incorporate it by reference into such a filing.

Item 6. None.

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Our management’s discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements included in this Annual Report on Form 10-K, which have been prepared by us in accordance with accounting principles generally accepted in the United States, or GAAP, and with Regulation S-X promulgated under the Securities Exchange Act of 1934, as amended. This discussion and analysis should be read in conjunction with these consolidated financial statements and the notes thereto included elsewhere in this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in Part I, Item 1A. Risk Factors of this Annual Report on Form 10-K, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Note on the COVID-19 Pandemic

The ongoing COVID-19 pandemic continues to have widespread, evolving, and unpredictable impacts on global economies, supply chains, financial markets, business practices and societies. The complex challenges created by the COVID-19 pandemic have had an adverse impact on our business, operations, and financial performance, and as such we continue to take steps to respond to these challenges and adjust our commercial strategy and operating plans accordingly.

We believe that the COVID-19 pandemic has had an adverse impact on sales of TAZVERIK since the June 2020 FDA approval of TAZVERIK for follicular lymphoma, or FL. Our commercial and medical affairs field teams continue to use virtual formats as well as in-person interactions, where possible, to allow us to serve the needs of healthcare providers, patients and other stakeholders, However, access to prescribers remains restrictive, and we expect these challenges to continue through the first half of 2022.

In response, we have taken steps to adjust our commercial strategy and continue to further refine our commercial strategy, recognizing that some of the changes brought about by the COVID-19 pandemic, such as ongoing restrictions to access prescribers by traditional sales personnel, will likely persist after the resolution of the pandemic. We are evolving our commercial strategies and deployment of resources to address these changes in market dynamics as we seek to increase awareness of TAZVERIK in ES and FL.

Although the initiation, enrollment and completion of our ongoing and planned clinical trials have not been meaningfully disrupted, we have experienced some delays in clinical trial startup activities due to what we believe to be mostly related to COVID-19 related capacity constraints and resulting delays in the packaging and labeling of clinical drug supply at a third-party manufacturer. We are aware of the impact that COVID-19 continues to have on other clinical trials in our industry and there is a risk of material impact on the conduct of our clinical trials as well. We are continuing to work with our clinical trial sites as we seek to ensure study continuity, enable medical monitoring, facilitate study procedures and maintain clinical data and records, including the use of local laboratories for testing, home delivery of study drug and remote data and records monitoring.

To date, the COVID-19 pandemic has not had a material impact on our commercial supply chain, and we currently have a consistent supply of tazemetostat and TAZVERIK that we believe will cover our ongoing clinical development as well as the ongoing commercialization for ES and FL. From time to time, however, we have experienced some occasional delays in connection with our clinical supply, including delays related to packaging and labeling. As a proactive measure, we have taken certain steps to try to reduce the risk to our supply chain, such as advancing orders for long-lead items in anticipation of potential future delays or shortages. Because the ongoing COVID-19 pandemic could materially adversely impact our suppliers and result in delays or disruptions in our current or future supply chain, we are continuing to monitor and manage our supply chain accordingly.

We are implementing a multi-stage return to office plan, and in October 2021 we opened our facilities to all employees who expressed interest in participating in a return-to-office pilot program. In the meantime, many of our employees continue to work in a remote operating model. Our laboratory scientists who engage in bench research activities now have full access to our laboratories. We are using our pilot program to further evaluate this hybrid model and will use that evaluation to formulate how we will move forward. Ultimately, our return to office plan will be based primarily on guidance from federal, state and local government authorities, and we expect that some form of a hybrid model will continue to exist for us in the future.

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We are closely monitoring the impact of the COVID-19 pandemic and related developments on our business, operations and financial performance. We plan to continue to assess the potential duration, scope and severity of the COVID-19 pandemic and its impacts on our business, operations and financial performance, and to continue to work closely with our third-party vendors, collaborators and other parties in order to seek to continue to advance our efforts with respect to the commercialization of TAZVERIK and to continue to advance the development of EZM0414 and our pipeline, while making the health and safety of our employees and their families, healthcare providers, patients and communities a top priority. Due to the evolving and uncertain global impacts of the COVID-19 pandemic, however, we cannot precisely determine or quantify the impact that this pandemic has had on our business, operations and financial performance to date or the impact that this pandemic will have in 2022 and beyond.

Please refer to our risk factors set forth in Part I, Item 1A. Risk Factors of this Annual Report on Form 10-K for the year ended December 31, 2021 for further discussion of risks related to the COVID-19 pandemic.

Operating Expense Reductions

In response to the challenges we have continued to face since we commenced the launch of TAZVERIK in FL in June 2020, in August 2021, we determined to implement changes to our commercial strategy and organization in an effort to accelerate commercial adoption of TAZVERIK in appropriate patients while also pursuing our research and broader corporate objectives.

On August 9, 2021, we announced a cross-functional reduction of our 2021 budgeted headcount by approximately 20%, which included approximately 11% of our then-current workforce under the cost reduction plan. Affected employees were provided separation benefits, including severance payments along with temporary healthcare coverage assistance. The severance and termination-related costs were approximately $2.0 million. We recorded these costs in the third quarter of 2021 and expect that payments of these costs will be made through August 2022.

In addition to the organizational changes and cross-functional headcount reduction announced in August 2021, on March 1, 2022, we announced a further reduction of our operating expenses, including a cross-functional workforce reduction of approximately 12% of our current employees. Additionally, we announced a pipeline reprioritization. Given the breadth of our current tazemetostat clinical development program, we have discontinued enrollment in our Phase 2 study of tazemetostat in combination with rituximab with FL in the third line or later treatment settings (SYMPHONY-2, EZH-1401), as well as in our Phase 1/1b basket study evaluating tazemetostat combinations in patients with solid tumors (EZH-1301) due to evolving market dynamics and a continued focus on optimizing our investments and eliminating potentially overlapping studies.

As part of these March 2022 headcount reductions and our pipeline reprioritization, we are implementing further changes to our commercial strategy, to our medical affairs and clinical development teams and to our broader organization. We are focused on accelerating commercial adoption of TAZVERIK in appropriate patients and on implementing a broader operational cost reduction plan that will reduce our headcount across different areas of the organization and re-prioritize our investment of company resources in important clinical trials and programs, including our SYMPHONY-1 (EZH-302), CELLO-1 (EZH-1101), EZH-1501 and SET-101 trials.

We expect that these actions will allow us to keep the company in a financial position that will enable us to continue to achieve important near-term milestones and execute on our long-term strategy. As part of the March 2022 workforce reduction, affected employees will be offered separation benefits, including severance payments along with temporary healthcare coverage assistance. We estimate that the severance and termination-related costs will be approximately $2.8 - 3.2 million and expect to record these charges in the first quarter of 2022. We expect that payments of these costs will be made through the end of the fourth quarter of 2022.

We plan to continue to implement our broader operational expense reduction effort, and to monitor and seek opportunities to further reduce our operating expenses.

Overview

We are a commercial-stage biopharmaceutical company that is committed to rewriting treatment for people with cancer through the discovery, development, and commercialization of novel epigenetic medicines. We aspire to change the standard of care for patients and physicians by developing targeted medicines with fundamentally new mechanisms of action directed at specific causes of hematological malignancies and solid tumors.

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We have one approved product, TAZVERIK (tazemetostat), which was granted accelerated approval by the U.S. Food and Drug Administration, or FDA, in 2020 for epithelioid sarcoma, or ES, and FL. Our focus is on maximizing our effectiveness as a commercial organization to achieve adoption of TAZVERIK among as many appropriate patients as possible, including in earlier treatment lines and in combination regimens with the data to support this expanded use; building on TAZVERIK’s pipeline-in-a-drug potential; and expanding our pipeline and evolving oncology portfolio, including with SET-101, our first-in-human Phase 1/1b trial of EZM0414, our novel, first-in-class, oral SETD2 inhibitor. We are leveraging our drug discovery platform and expertise as a leader in epigenetics, as well as our team’s deep experience across clinical development and commercialization to execute on our strategy.

In January 2020, the FDA granted accelerated approval of TAZVERIK (tazemetostat), an oral, first in class, selective small molecule inhibitor of the EZH2 histone methyltransferase, or HMT, for the treatment of adult and pediatric patients aged 16 years and older with metastatic or locally advanced ES not eligible for complete resection. This approval was based on overall response rate and duration of response data shown in the ES cohort of our Phase 2 trial in patients with INI1-negative tumors. We continue to make TAZVERIK available to eligible patients and their physicians in the United States.

As part of the accelerated approval for ES, continued approval for this indication is contingent upon verification and description of clinical benefit in a confirmatory trial. To provide this confirmatory evidence to support a full approval of TAZVERIK for this indication, we are conducting a single, randomized, controlled Phase 1b/3 confirmatory trial in the United States (EZH-301) assessing tazemetostat in combination with doxorubicin compared with doxorubicin plus placebo as a front-line treatment for ES. The trial is expected to enroll approximately 152 patients. We have completed the planned enrollment in the Phase 1b safety run-in portion of the trial and the Phase 3 efficacy portion of the trial is open for accrual. We reported safety and preliminary activity data from the patients in the safety run-in portion of the EZH-301 trial at the American Society of Clinical Oncology (ASCO) Annual Meeting in June 2021.

In June 2020, the FDA approved a supplemental New Drug Application, or sNDA, for TAZVERIK for adult patients with relapsed or refractory (R/R) FL whose tumors are positive for an EZH2 mutation as detected by an FDA-approved test and who have received at least two prior systemic therapies, and adult patients with relapsed or refractory FL who have no satisfactory alternative treatment options. These indications were approved under accelerated approval with a priority review, based on overall response rate and duration of response data shown in the FL cohorts of our Phase 2 clinical trial in patients with EZH2 mutations and wild-type EZH2. We continue to make TAZVERIK available to eligible patients and their physicians in the United States.

As part of the accelerated approval for FL, continued approval for these R/R FL indications is contingent upon verification and description of clinical benefit in a confirmatory trial. To provide this confirmatory evidence to support a full approval of TAZVERIK for these indications, we are conducting a single global, randomized, adaptive Phase 1b/3 confirmatory trial (EZH-302, SYMPHONY-1) assessing the combination of tazemetostat with “R2” (lenalidomide and rituximab), an approved chemotherapy-free treatment regimen, compared with R2 plus placebo for R/R FL patients in the second-line or later treatment setting. We plan to leverage the confirmatory trial and also conduct post-marketing commitments to expand the TAZVERIK label into the second-line treatment setting.

In December 2021 we presented updated safety and activity data from the Phase 1b safety run-in portion of this confirmatory trial at the 2021 American Society of Hematology (ASH) Annual Meeting. We continue to follow the 40 patients in the Phase 1b safety run-in portion of the trial, and we expect to present follow-up data from the safety run-in portion of the trial at a medical conference later in 2022.

We expect that the Phase 3 portion of the SYMPHONY-1 trial will be a global, randomized and adaptive confirmatory trial in 500 patients. Based on the Phase 1b safety run-in results, in December 2021 we submitted a protocol amendment to the FDA with 800 mg twice-daily as the recommended tazemetostat dose (RP3D) for the Phase 3 portion of the trial. After completing the 30-day voluntary waiting period following submission of the protocol amendment for 800 mg RP3D without any objection from the FDA, and as we continue to conduct the Phase 1b safety run-in portion of the trial, we have accelerated global start-up activities and are activating as many study sites as possible, globally, for the Phase 3 portion of the trial. The primary endpoint for the Phase 3 portion of the trial will be based on progression free survival as determined by investigator. Based on discussions with the FDA, this portion of the trial will include two interim analyses, the first of which is for futility only and the second of which will be conducted for futility, and if 65% of progression free survival events have occurred, the trial will also include an efficacy evaluation. In July 2021 China’s Center for Drug Evaluation, or CDE, approved the Investigational New Drug Application, or IND, we filed in China for SYMPHONY-1. We are currently screening

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patients in the Phase 3 portion of this trial and we expect to enroll the first patient in the Phase 3 portion of this trial in the first quarter of 2022.

Through our planned development efforts, our intention is to eventually make TAZVERIK available in all lines of treatment for patients with FL. In collaboration with The Lymphoma Study Association, or LYSA, and based on clinical activity observed with tazemetostat in combination with R-CHOP (rituximab, cyclophosphamide, doxorubicin, vincristine and prednisolone) as a front-line treatment for patients with high risk diffuse large B-cell lymphoma, or DLBCL, LYSA is conducting a Phase 1b/2 clinical trial to evaluate this combination as a front-line treatment for high-risk patients with FL and DLBCL. Patient enrollment in the Phase 2 portion of this trial is now nearly complete with 111 patients out of a target of approximately 122 patients in DLBCL and 61 patients out of a target of approximately 62 patients in FL enrolled as of February 23, 2022. We expect that interim results from the Phase 2 portion of this trial will be presented at a medical conference in the second half of 2022. We are also finalizing plans for investigator-sponsored studies to evaluate tazemetostat in combination with venetoclax or BTK inhibitors for the treatment of patients with FL in the third-line or later treatment settings.

We are also developing tazemetostat for the treatment of a broad range of other cancer types in multiple treatment settings. Tazemetostat has shown meaningful clinical activity as an investigational monotherapy in multiple cancer indications and has been generally well-tolerated across clinical trials to date. We believe tazemetostat is a “pipeline in a product” opportunity and plan to explore its potential utility in additional indications and combinations.

There are four areas where we see the greatest potential for tazemetostat, all of which are based on a strong scientific hypothesis and are for patients suffering from diseases that would benefit from a new effective and safe treatment option, including:

•Lymphomas and B-cell malignancies, such as DLBCL, mantle cell lymphoma, or MCL, multiple myeloma and others;

•Molecularly defined solid tumors, such as chordoma, melanoma, mesothelioma, and tumors harboring an EZH2 or SWI/SNF alteration;

•PARPi-resistant tumors, such as castration-resistant prostate cancer, small cell lung cancer, and others; and

•Immuno-oncology sensitive tumors, such as small cell lung cancer, prostate cancer and others.

As part of these broader tazemetostat development efforts, we are conducting a global, multi-center, open-label randomized Phase 1b/2 trial (EZH-1101, CELLO-1). The Phase 2 efficacy portion of the CELLO-1 trial, which is evaluating tazemetostat plus enzalutamide compared to enzalutamide monotherapy in patients with metastatic castration-resistant prostate cancer, or mCRPC, is approximately 75% enrolled toward a target of 80 patients and we expect to complete enrollment in the Phase 2 portion of the trial in 2022. We plan to provide updated data from the safety run-in portion of the trial as well as interim data from the Phase 2 portion of the trial in the second half of 2022.

We own the global development and commercialization rights to tazemetostat outside of Japan and greater China. Eisai Co. Ltd, or Eisai, holds the rights to develop and commercialize tazemetostat in Japan, and Hutchison China MediTech Investment Limited, or HutchMed, holds certain rights to develop and commercialize tazemetostat in greater China.

TAZVERIK is available to eligible patients in the United States via a specialty distribution network. Through this specialty distribution network, we sell TAZVERIK principally to a limited number of specialty pharmacies, which dispense the product directly to patients, and specialty distributors, which in turn sell the product to hospital pharmacies and community practice pharmacies for the treatment of patients. To commercialize TAZVERIK for the approved ES and FL indications in the United States, we have built a focused field presence and marketing capabilities.

On August 7, 2021, we entered into a strategic collaboration pursuant to a license agreement with HutchMed through which we granted a license to HutchMed for the co-exclusive (with us) development and exclusive commercialization of tazemetostat, either as monotherapy or as a part of combinations with other therapies, including HutchMed proprietary compounds, agreed by us and HutchMed for the treatment of ES, FL and DLBCL in humans, and any additional indications agreed to by us and HutchMed in mainland China, Taiwan, Hong Kong and Macau, or the HutchMed Territory.

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For other geographies outside the United States, we are evaluating the most efficient path to obtain marketing approval, commercialize and distribute TAZVERIK to reach patients, including pursuing potential strategic collaborations. Based on comparators and the regulatory landscape, we have decided not to pursue marketing approval of tazemetostat as monotherapy from the European Medicines Agency, or EMA at this time.

Beyond tazemetostat, we are utilizing our drug discovery platform to progress preclinical efforts and discover and identify additional product candidates to expand our pipeline of inhibitors against several classes of chromatin modifying proteins, or CMPs, including HMTs, histone acetyltransferases, or HATs, and helicases.

Our most advanced product candidate, EZM0414, is a novel first-in-class oral inhibitor of the SETD2 HMT.

SETD2 is an HMT that plays multiple important roles in oncogenesis. Based on the potential of SETD2 inhibition demonstrated in multiple preclinical settings, including multiple myeloma, and in particular high risk t(4;14) multiple myeloma and in other B-cell malignancies such as DLBCL, as well as in combination with existing and emerging therapies including tazemetostat, we submitted an IND for EZM0414 to the FDA in July 2021. We received “study may proceed” from the FDA with respect to our IND for EZM0414 in July 2021. In October 2021, EZM0414 was granted Fast Track designation by the FDA in adult patients with relapsed or refractory DLBCL and in January 2022 we received orphan drug designation from the FDA for EZM0414 for the treatment of multiple myeloma. In the fourth quarter of 2021, we initiated a Phase 1/1b trial (SET-101) intended to evaluate the safety and optimize the dose and schedule of EZM0414 in R/R multiple myeloma and DLBCL patients. The Phase 1 portion of our SET-101 trial is a 3 + 3 dose escalation design and includes six planned dose levels ranging from 100 mg to 900 mg once daily. Once we have optimized the dose, we then expect to expand the trial to two patient cohorts in multiple myeloma: t(4;14) multiple myeloma and non t(4;14) multiple myeloma. Based on dose optimization data from the trial, we may add a third patient cohort in DLBCL. We are screening patients with one site open for the Phase 1 dose escalation portion of the SET-101 trial, which we expect will enroll between 30-36 patients. We plan to provide updates as the trial reaches key enrollment milestones along with preliminary data from the trial in 2022.

To date we have entered into various strategic collaborations, including with Eisai, HutchMed, Roche and other third parties. As one of several key aspects of our strategy, we plan to continue to leverage our existing collaborations and to seek to identify new potential strategic collaborations to further support and grow our business in and outside of the United States.

Through December 31, 2021, in addition to revenues from product sales, we have raised an aggregate of $1,568.3 million to fund our operations. This includes $268.8 of non-equity funding through our collaboration agreements, $368.1 million of funding, consisting of $150.0 million in equity funding received through agreements with RPI Finance Trust, or RPI, and $218.1 million in debt financing received through a loan agreement with BioPharma Credit Investments V (Master) LP and BPCR Limited Partnership (as transferee of BioPharma Credit Investments V (Master) LP’s interest as a lender), or the Lenders, $855.4 million from the sale of common stock and series A convertible preferred stock in our public and at-the-market offerings and $76.0 million from the sale of redeemable convertible preferred stock in private financings prior to our initial public offering in May 2013.

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As of December 31, 2021, we had $176.8 million in cash, cash equivalents and marketable securities. In January 2022, the Company raised approximately $79.5 million in net proceeds (after deducting underwriting discounts and commissions and estimated offering costs) from the sale of 56,666,667 shares of its common stock in a public offering at a price of $1.50 per share.

We commenced active operations in early 2008, and since inception, have incurred significant operating losses. Our net loss was $251.1 million for the year ended December 31, 2021. As of December 31, 2021, our accumulated deficit totaled $1,239.8 million. Notwithstanding our sales of TAZVERIK, we expect to continue to incur significant expenses and operating losses over the next several years. Our net losses may fluctuate significantly from quarter to quarter and year to year. We expect our expenses to increase in connection with our ongoing activities, particularly as we expect to incur significant commercialization expenses related to product manufacturing, marketing, sales and distribution. In addition, we expect our expenses to increase as we fund our tazemetostat development program; make any milestone and royalty payments provided for and achieved under the amended and restated collaboration and license agreement with Eisai; pay interest and principal associated with our amended and restated loan agreement with BioPharma Credit Investments V (Master) LP, BPCR Limited Partnership and BioPharma Credit PLC, or the Amended and Restated Loan Agreement; and continue research and development and initiate clinical trials of, and seek regulatory approval for, any future product candidates.

Funding Agreements with BioPharma Credit Investments V (Master) LP, BPCR Limited Partnership, BioPharma Credit PLC and RPI Finance Trust

We executed a purchase agreement with RPI on November 4, 2019, or the RPI Purchase Agreement. Pursuant to the RPI Purchase Agreement, we sold to RPI 6,666,667 shares of our common stock and a warrant to purchase up to 2,500,000 shares of our common stock at an exercise price of $20.00 per share, or the Common Stock Warrant. We also sold our rights to receive royalties from Eisai with respect to net sales by Eisai of tazemetostat products in Japan, or the Japan Royalty, pursuant to the amended and restated collaboration and license agreement between us and Eisai, dated as of March 12, 2015, or the Eisai License Agreement. In consideration for the sale of shares of our common stock, the Common Stock Warrant and the Japan Royalty, RPI paid us $100.0 million upon the closing of the RPI Purchase Agreement in November 2019. In addition, RPI agreed, in connection with RPI’s acquisition from Eisai of the right to receive royalties from us under the Eisai License Agreement, to reduce our royalty obligation by low single digits upon the achievement of specified annual net sales levels. We also had the option to sell to RPI $50.0 million of shares of common stock for an 18-month period beginning November 4, 2019, or the Put Option. On February 11, 2020, we sold 2,500,000 shares of common stock to RPI for an aggregate of $50.0 million in proceeds at a sale price of $20.00 per share of common stock pursuant to the Put Option.

On November 4, 2019, we also entered into a Loan Agreement with BioPharma Credit PLC, or the Collateral Agent, and the Lenders, providing for up to $70.0 million in secured term loans to be advanced in up to three tranches, or the Loan Agreement. We borrowed $70.0 million in the aggregate under the three tranches pursuant to the Loan Agreement.

On November 3, 2020, we, the Collateral Agent and the Lenders amended and restated the Loan Agreement, or, as amended and restated, the Amended and Restated Loan Agreement. The Amended and Restated Loan Agreement provides for, among other things, an additional secured term loan facility of $150.0 million, or the Tranche D Loan. On November 18, 2020, we borrowed the Tranche D Loan.

The obligations under the Amended and Restated Loan Agreement remain secured by a first priority security interest that was granted at the time of the Loan Agreement in and a lien on substantially all of our assets, subject to certain exceptions.

The Amended and Restated Loan Agreement contains certain customary representations and warranties, affirmative and negative covenants and events of default applicable to us and our subsidiaries. If an event of default occurs and is continuing, the Collateral Agent under the Amended and Restated Loan Agreement may, among other things, accelerate the loans and foreclose on the collateral. See Note 13, Long-Term Debt, of the notes to our consolidated financial statements included in this Annual Report on Form 10-K for a description of the key terms of the Amended and Restated Loan Agreement.

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Collaborations

Refer to Item 1, Business--Our Collaborations and Note 11, Collaborations, of the notes to our consolidated financial statements included in this Annual Report on Form 10-K for a description of the key terms of our arrangements with Eisai Co. Ltd, or Eisai, Hutchison China MediTech Investment Limited, or HutchMed, and Roche Sequencing Solutions, Inc., or Roche Sequencing. On December 16, 2021, we received a notice of termination of our collaboration and license agreement with Glaxo Group Limited, effective March 16, 2022.

Results of Operations

For a discussion related to the results of operations for 2020 compared to 2019, refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations – Results of Operations" in our Annual Report on Form 10–K for the year ended December 31, 2020 filed with the SEC on February 23, 2021.

Revenues

The following is a comparison of total revenues for the years ended December 31, 2021 and 2020:

	Year Ended December 31,
	2021		2020		Change
	(In millions)
Product revenues, net	$	30.9	$	11.5	$	19.4
Collaboration and other revenue		6.5		4.3		2.2
Total revenues	$	37.4	$	15.8	$	21.6

Product Revenues, net

Net product revenues represent U.S. sales from our sole commercial product, TAZVERIK, which was first approved by the FDA on January 23, 2020, less allowances and accruals. During the years ended December 31, 2021, and 2020 net product revenues were $30.9 million and $11.5 million, respectively. The $19.4 million increase reflects the timing of approval of TAZVERIK for ES in January 2020 and the approval of TAZVERIK for FL in June 2020. The increase also reflects the inclusion of $7.4 million in product revenue during the year ended December 31, 2021 related to the sale of commercial product by one of our customers to a third-party pharmaceutical company for use in its clinical trials. Sales allowances and accruals consisted of patient financial assistance, distribution fees, discounts, and chargebacks.

Collaboration and Other Revenue

Our collaboration and other revenue during the periods included amounts recognized from deferred revenue related to upfront payments for licenses or options to obtain licenses in the future, research and development services revenue earned, milestone payments earned under collaboration and license agreements with our collaboration partners and revenue from the sale of tazemetostat active pharmaceutical ingredient (API) and drug product to our licensees and collaborators.

During the years ended December 31, 2021 and 2020, we recognized $6.5 million and $4.3 million, respectively, in collaboration and other revenue. In 2021 we recognized $6.5 million in collaboration and other revenue in connection with our waiver of our exclusive right to the supply of tazemetostat drug substance from Eisai’s manufacturer, the manufacture and supply of tazemetostat, and technical support services under our supply agreement with Eisai. In 2020 we recognized $3.8 million of collaboration and other revenue under our collaboration agreement with Celgene related to the recognition of the remaining deferred revenue related to the agreement, which was recognized as revenue as a result of the termination of the collaboration agreement with Celgene. We recognized $0.5 million in collaboration and other revenue under our collaboration agreement with Boehringer Ingelheim during the year ended December 31, 2020 related to amendments to extend the research period under the collaboration agreement under which Boehringer Ingelheim funded $0.5 million of additional

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research activities. In December 2020, we received written notice from Boehringer Ingelheim to terminate the collaboration agreement, effective January 31, 2021.

Cost of Revenue

The following is a comparison of cost of revenue for the years ended December 31, 2021 and 2020:

	Year Ended December 31,
	2021		2020		Change
	(In millions)
Cost of product revenue	$	9.7	$	5.1	$	4.6
Cost of other revenue		0.8		-		0.8
Total cost of revenue	$	10.5	$	5.1	$	5.4

The cost of revenue consists of costs related to our product revenue and other revenue for the sales of TAZVERIK as well as tazemetostat drug product and drug substance. These costs include materials, labor, manufacturing overhead, amortization of milestone payments, and royalties payable on net sales of TAZVERIK and sales of tazemetostat drug product. Costs related to the sale of TAZVERIK are included in cost of product revenue while cost related to the sale of tazemetostat drug product and drug substance are included in cost of other revenue.

During the years ended December 31, 2021 and 2020, the cost of product revenue was $9.7 million and $5.1 million, respectively, and consisted of $0.9 million and $0.4 million, respectively, in costs associated with manufacturing TAZVERIK, $4.2 million and $3.0 million, respectively, in amortization expense related to the two $25.0 million milestone payments under our agreement with Eisai upon regulatory approval of TAZVERIK for ES and upon regulatory approval of TAZVERIK for FL, and $4.6 million and $1.7 million, respectively, in worldwide royalties due under the Eisai License Agreement on net sales of TAZVERIK in the year ended December 31, 2021. Cost of other revenue during the year ended December 31, 2021 consisted of $0.8 million of costs related to sales of tazemetostat drug product to Eisai. All product costs incurred prior to FDA approval of TAZVERIK in January 2020 were expensed as research and development expenses. We expect our cost of product revenues (excluding amortization of intangible assets) to continue to be positively impacted during 2022, as we sell through certain inventory that was expensed prior to FDA approval of TAZVERIK in January 2020.

Research and Development

Research and development expenses consist of expenses incurred in performing research and development activities, including clinical trials and related clinical manufacturing expenses, fees paid to external providers of research and development services, third-party clinical research organizations, or CROs, compensation and benefits for full-time research and development employees, facilities expenses, overhead expenses, and other outside expenses. Most of our research and development costs are external costs, which we track on a program-by-program basis. Our internal research and development costs are primarily compensation expenses for our full-time research and development employees, including stock-based compensation expense.

In our early-stage research, we identify and prioritize novel CMPs that are implicated in cancer, and seek to develop potent and selective small molecule inhibitors of these targets. During this phase of research, our external costs primarily relate to lead discovery, biology, drug metabolism and pharmacokinetics and chemistry services from a multinational network of third-party providers of research and development services. As our product candidates

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progress into preclinical and clinical development, external costs are driven by clinical trial costs, manufacturing expenses, and third-party research and development expenses.

In circumstances where our collaboration and license agreements provide for equally co-funded global development under joint risk sharing collaborations, and where we are the study sponsor, amounts received for co-funding are recorded as a reduction to research and development expense.

The following is a comparison of research and development expenses for the years ended December 31, 2021 and 2020 :

	Year Ended December 31,
	2021		2020		Change		%
	(In millions)
Research and development	$	131.0	$	110.9	$	20.1		18.1	%

During the year ended December 31, 2021, total research and development expenses increased by $20.1 million compared to the year ended December 31, 2020, primarily due to increases in clinical trial expenses and discovery research activities related to tazemetostat in indications other than the approved indications as well as our SETD2 inhibitor EZM0414 program. Additionally, severance and termination-related costs totaling $0.4 million were recorded as research and development expenses in 2021 related to the August 2021 cost reduction plan. Increases in research and development expenses were partially offset by decreases in costs associated with the build-out of our regulatory and late-stage development groups.

The following table illustrates the components of our research and development expenses:

	Year Ended December 31,
Product Program	2021		2020		Change		%
	(In millions)
External research and development expenses:
Tazemetostat and related EZH2 programs	$	54.1	$	42.0	$	12.1		28.8	%
SETD2 inhibitor EZM0414 program		2.0		—		2.0		100.0
Discovery and preclinical stage product programs, collectively		19.4		17.8		1.6		9.0
Unallocated personnel and other expenses		55.5		51.1		4.4		8.6
Total research and development expenses	$	131.0	$	110.9	$	20.1		18.1	%

External research and development expenses include external manufacturing costs related to the acquisition of active pharmaceutical ingredient and manufacturing of clinical drug supply, ongoing clinical trial costs, discovery and preclinical research in support of the tazemetostat program and expenses associated with our SETD2 inhibitor EZM0414 program.

External research and development expenses for tazemetostat and related EZH2 programs increased by $12.1 million for the year ended December 31, 2021 compared to the year ended December 31, 2020. The increase in external tazemetostat and related EZH2 programs research and development expenses in the year ended December 31, 2021 relates to increases in clinical trial expenses and discovery research activities related to tazemetostat in other indications associated with increased clinical trial activity, which were offset by decreases in costs associated with the build-out of our regulatory and late-stage development groups that we conducted in 2020.

External research and development expenses for our EZM0414 SETD2 inhibitor program increased $2.0 million for the year ended December 31, 2021 compared to the 2020. We designated the program as a clinical development program in the third quarter of 2021. Prior to the designation of the program as a clinical development program, we allocated costs related to the EZM0414 program to external research and development expenses for discovery and preclinical stage product programs.

External research and development expenses for discovery and preclinical stage product programs increased by $1.6 million for the year ended December 31, 2021 compared to the year ended December 31, 2020, was primarily

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related to increased spending for discovery research activities and development activities related to our preclinical programs, partially offset by reduced preclinical costs in connection with our EZM0414 SETD2 inhibitor program as a result of the designation of the EZM0414 SETD2 inhibitor program as a clinical development program in the third quarter of 2021.

Unallocated personnel and other expenses are comprised of compensation expenses for our full-time research and development employees and other general research and development expenses. Unallocated personnel and other expenses for the year ended December 31, 2021 increased $4.4 million compared to the year ended December 31, 2020. The increase is a result of increases in facilities and equipment related expenses and in unallocated personnel costs, offset by an increase in the allocation of expenses to projects.

We expect that research and development expenses will decrease in 2022, as we continue to implement our operating expense reductions and prioritize our investment of company resources in important clinical trials and programs, including our SYMPHONY-1 (EZH-302) and CELLO-1 (EZH-1101), EZH-1501 and SET-101 trials.

Selling, General and Administrative

Selling, general and administrative expenses consist primarily of salaries and related benefits, including stock-based compensation, related to our executive, finance, intellectual property, business development and support functions. Other selling, general and administrative expenses include allocated facility-related costs not otherwise included in research and development expenses, travel expenses and professional fees for auditing, tax and legal services, including intellectual property and general legal services.

The following is a comparison of selling, general and administrative expenses for the years ended December 31, 2021 and 2020 :

	Year Ended December 31,
	2021		2020		Change		%
	(In millions)
Selling, general and administrative	$	134.0	$	125.2	$	8.8		7.0	%

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For the year ended December 31, 2021, our selling, general and administrative expenses increased $8.8 million compared to the year ended December 31, 2020, primarily due to increased commercialization activities, including the build-out of our sales force and commercial infrastructure to support the commercial launch of TAZVERIK in the approved ES and FL indications, and increased personnel related expenses. Additionally, severance and termination-related costs totaling $1.6 million were recorded as selling, general and administrative expenses in 2021 related to the August 2021 cost reduction plan.

We expect that selling, general and administrative expenses will decrease in 2022 as we implement changes to our commercial strategy and organization in an effort to accelerate commercial adoption of TAZVERIK in appropriate patients as well as an operational cost reduction across general and administrative functions as part of our prioritization of our investment of company resources in important clinical trials and programs.

Other (Expense) Income, Net

The following is a comparison of other (expense) income, net for the years ended December 31, 2021 and 2020:

	Year Ended December 31,
	2021			2020			Change			%
	(In millions)
Other income, net
Interest income	$	0.2		$	2.9		$	(2.7	)		(93.1	)%
Interest expense		(22.5	)		(7.6	)		(14.9	)		196.1
Other expense, net		(0.1	)		(0.1	)		—			-
Change in fair value of warrants to purchase common stock		11.1			—			11.1			100.0
Non-cash interest expense related to sale of future royalties		(1.8	)		(1.4	)		(0.4	)		28.6
Other (expense) income, net	$	(13.1	)	$	(6.2	)	$	(6.9	)		111.3	%

Other (expense) income, net consists of interest income earned on our cash equivalents and marketable securities, net of imputed interest expense paid under our capital lease obligation. The increase in other expense for the year ended December 31, 2021 is principally due to an increase in interest expense of $15.0 million incurred in connection with our long-term debt obligations under our Amended and Restated Loan Agreement which increased to a principal balance of $220.0 million in the fourth quarter of 2020, a decrease in net interest income of $2.6 million due to a combination of lower cash, cash equivalents and marketable securities combined with lower rates of return, and an increase in non-cash interest expense related to the sale of future royalties of $0.4 million. These increases in other expense were offset by income related to the changes in fair value of warrant liability of $11.1 million due to a decrease in our stock price.

Income Tax Benefit

We evaluated the expected recoverability of our net deferred tax assets as of December 31, 2021 and 2020, and determined that there was insufficient positive evidence to support the recoverability of these net deferred tax assets, concluding it is more likely than not that our net deferred tax assets would not be realized in the future; therefore, the Company provided a full valuation allowance against its net deferred tax asset balance as of December 31, 2021 and 2020.

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Liquidity and Capital Resources

For a discussion related to our cash flows for 2020 compared to 2019, refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources" in our Annual Report on Form 10–K for the year ended December 31, 2020 filed with the SEC on February 23, 2021

Through December 31, 2021, in addition to revenues from product sales, we have raised an aggregate of $1,568.3 million to fund our operations. This includes $268.8 million in non-equity funding through our collaboration agreements, $368.1 million of funding, consisting of $150.0 million in equity funding received through agreements with RPI Finance Trust, or RPI, and $218.1 million in debt financing received through a loan agreement with BioPharma Credit Investments V (Master) LP and BPCR Limited Partnership (as transferee of BioPharma Credit Investments V (Master) LP’s interest as a lender), or the Lenders, $855.4 million from the sale of common stock and series A convertible preferred stock in our public offerings and at-the-market offerings and $76.0 million was from the sale of redeemable convertible preferred stock in private financings prior to our initial public offering in May 2013. As of December 31, 2021, we had $176.8 million in cash, cash equivalents and marketable securities.

On May 6, 2021, we entered into an Open Market Sale AgreementSM, or ATM Sale Agreement, with Jefferies LLC, or Jefferies, to sell, from time to time, shares of our common stock having an aggregate offering price of up to $200,000,000 through an “at the market offering” as defined in Rule 415 under the Securities Act of 1933, as amended, under which Jefferies would act as sales agent, which we refer to as the ATM Offering. The shares that may be sold under the ATM Sale Agreement, if any, are issued and sold pursuant to our shelf registration statement on Form S-3 that was declared effective by the Securities and Exchange Commission on May 13, 2021. Through December 31, 2021, we have sold a total of 3,840,977 shares under the ATM Offering, resulting in aggregate net proceeds to us of approximately $16.0 million after deducting issuance costs of $0.5 million.

In addition to our existing cash, cash equivalents and marketable securities, we are eligible to earn milestone payments under our collaboration agreement with HutchMed. Our ability to earn these payments and the timing of earning these payments is dependent upon the outcome of research and development activities and is uncertain at this time.

In January 2022, we raised approximately $79.5 million in net proceeds (after deducting underwriting discounts and commissions and estimated offering costs, but excluding any expenses and other costs reimbursed by the underwriters) from the sale of 56,666,667 shares of our common stock in a public offering at a price of $1.50 per share.

Funding Requirements

Our primary uses of capital are clinical trial costs, third-party research and development services, expenses related to commercialization, debt service obligations, compensation and related expenses, laboratory and related supplies, legal and other regulatory expenses and general overhead costs.

Because the continued approval of TAZVERIK in the approved indications is contingent upon verification and description of clinical benefit in confirmatory trials, and because we are developing tazemetostat for other indications, we cannot estimate the actual amounts necessary to successfully complete the development and commercialization of TAZVERIK for the approved indications or the indications that we are exploring or that we may plan to explore. Because EZM0414 is an early clinical product candidate and any future product candidates are in various stages of preclinical development with uncertain outcomes, we also cannot estimate the actual amounts necessary to successfully complete the development and commercialization of EZM0414 or future product candidates. Because of these uncertainties, we also cannot estimate whether, or when, we may achieve profitability. Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity or debt financings and collaboration arrangements. Except for any obligations of our collaborators to make license, milestone or royalty payments under our agreements with them, we do not have any committed external sources of liquidity. To the extent that we raise additional capital through the future sale of equity or debt, the ownership interest of our stockholders may be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our existing common stockholders. Debt

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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. If we raise additional funds through collaboration arrangements in the future, we may have to relinquish valuable rights to our technologies, future revenue streams or product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise any additional funds that may be needed 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.

Outlook

Based on our current operating plan, we expect that our existing cash, cash equivalents and marketable securities as of December 31, 2021, together with the $79.5 million in net proceeds raised from the common stock offering in January 2022 and cash we expect to generate from product sales, will be sufficient to fund our planned operating expenses and capital expenditure requirements and pay our debt service obligations as they become due into the third quarter of 2023, without giving effect to any potential milestone payments we may receive under our collaboration agreements. We have based this estimate on assumptions that may prove to be wrong, such as the revenue that we expect to generate from the sale of our products, or as to our clinical development costs, particularly as the process of testing drug candidates in clinical trials is costly and the timing of progress in these trials is uncertain. As a result, we could use our capital resources sooner than we expect.

Cash Flows

The following is a summary of cash flows for the years ended for the years ended December 31, 2021 and 2020:

	Year Ended December 31,
	2021			2020			Change			%
	(In millions)
Net cash (used in) operating activities	$	(226.9	)	$	(206.3	)	$	(20.6	)		10.0	%
Net cash provided by (used in) investing activities		125.5			(14.6	)		140.1			(959.6	%)
Net cash provided by financing activities		31.5			249.7			(218.2	)		(87.4	%)

Net Cash Used in Operating Activities

Net cash used in operating activities was $226.9 million during the year ended December 31, 2021 compared to $206.3 million during the year ended December 31, 2020. The increase in net cash used in operating activities of $20.6 million primarily relates to our net loss of $251.1 million and the $11.1 million change in fair value of warrants, partially offset by changes in working capital of $0.2 million, net depreciation and amortization of $5.2 million, non-cash stock-based compensation of $26.8 million, and non-cash interest expense associated with the sale of future royalties of $1.8 million.

Net Cash Provided by (Used in) Investing Activities

Net cash provided by investing activities during the year ended December 31, 2021 reflects maturities of available-for-sale securities of $388.6 million, offset by $262.6 million of purchases of available-for-sale securities, and $0.5 million of purchases of property and equipment.

Net cash used in investing activities during the year ended December 31, 2020 reflects $276.4 million of purchases of available for sale securities, a $25.0 million milestone payment under the Eisai collaboration agreement upon regulatory approval of tazemetostat for ES, a $25.0 million milestone payment under the Eisai collaboration agreement upon regulatory approval of tazemetostat for FL, and $0.9 million of purchases of property and equipment, offset by maturities and sales of available for sale securities of $312.7 million.

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Net Cash Provided by Financing Activities

Net cash provided by financing activities of $31.5 million during the year ended December 31, 2021 primarily reflects net proceeds from the sale of common stock under the ATM Sale Agreement of $16.0 million, the purchases of shares under our employee stock purchase plan of $1.9 million, stock option exercises of $0.9 million, and $13.1 million from the issuance of the HutchMed Warrant, partially offset by the payment of offering costs of $0.3 million related to the ATM program.

Net cash provided by financing activities of $249.7 million during the year ended December 31, 2020 primarily reflects cash received from the sale of common stock of $50.0 million in connection with our exercise of our Put Option to sell shares of our common stock to Royalty Pharma, net cash received during the period from Tranche B Tranche C and Tranche D Loan borrowings totaling $195.0 million under the Amended and Restated Loan Agreement, stock option exercises of $6.7 million, and the purchases of shares under our employee stock purchase plan of $1.3 million, partially offset by payments of debt issuance costs of $3.1 million and offering costs of $0.1 million.

Contractual Obligations and Contingent Liabilities

On August 11, 2021, we entered into a fifth amendment to the Technology Square Lease, the Fifth Amendment, with ARE-TECH Square, LLC. Under the Fifth Amendment, we extended the term of the Technology Square Lease through November 30, 2024. Under the Fifth Amendment, we will continue to pay the current monthly base rent amount contemplated by the Technology Square Lease through November 30, 2022, with an increase commencing on December 1, 2022 and adjusting the monthly base rent amount to approximately $377,000 and an increase commencing on December 1, 2023 and adjusting the monthly base rent amount to approximately $388,000 through November 30, 2024. Under the current terms of the Technology Square Lease, we do not have any further right to extend the term beyond November 30, 2024.

We remain committed to fund $1.0 million of development costs payable to Roche Molecular, or Roche, upon certain development and regulatory milestones, under our amended companion diagnostic agreement with Roche.

We have incurred secured indebtedness of $220.0 million under our amended and restated loan agreement with BioPharma Credit Investments V (Master) LP, BPCR Limited Partnership and BioPharma Credit PLC. The interest rate for the loans under the agreement are determined by reference to a Eurodollar rate plus 7.75% above such Eurodollar rate subject to a 2.00% floor. Interest is paid quarterly with principal repayments beginning in the first quarter of 2024. Our long-term debt obligation is more fully described in Note 13, Long-Term Debt to the financial statements in Item 15 of this Annual Report on Form 10-K.

This description of our contractual obligations does not include potential future milestones or royalties that we may be required to make under license and collaboration agreements due to the uncertainty of events requiring payment under these agreements.

We enter into contracts in the normal course of business with clinical research organizations for clinical and preclinical research studies, external manufacturers for product for use in our clinical trials, and other research supplies and other services as part of our operations. These contracts generally provide for termination on notice, and therefore are cancelable contracts and not included in contractual commitments.

Critical Accounting Policies and Use of Estimates

Our management’s discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these consolidated financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the balance sheets and the reported amounts of collaboration revenue, inventory and expenses during the reporting periods. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances at the time such estimates are made. Actual results and outcomes may differ materially from our estimates, judgments and assumptions. We

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periodically review our estimates in light of changes in circumstances, facts and experience. The effects of material revisions in estimates are reflected in the consolidated financial statements prospectively from the date of the change in estimate.

We define our critical accounting policies as those accounting principles generally accepted in the United States of America that require us to make subjective estimates and judgments about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations as well as the specific manner in which we apply those principles. Management has determined that our most critical accounting policies are those relating to revenue recognition, research and development expenses, including our accounting for clinical trial expense and accruals, inventory and going concern. As our clinical development plan for tazemetostat and EZM0414 progresses, we expect research and development expenses and, in particular, our accounting for clinical trial accruals to be an increasingly important critical accounting policy.

Revenue Recognition – Product Revenue

We recognize revenue when our customer obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for those goods or services. To determine revenue recognition, we perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy a performance obligation. We only apply the five-step model to contracts when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer.

We sell TAZVERIK in the United States principally to a limited number of specialty pharmacies, which dispense the product directly to patients, and specialty distributors, which in turn sell the product to hospital pharmacies and community practice pharmacies (collectively, healthcare providers) for the treatment of patients. The specialty pharmacies and specialty distributors are referred to as our customers.

Revenue is recognized by us when the customer obtains control of the product, which occurs at a point in time, typically when the product is received by our customers. We provide a right of return to our customers for unopened product for a limited time before and after its expiration date, which lapses upon shipment to a patient. Healthcare providers to whom specialty distributors sell TAZVERIK hold limited inventory that is designated for patients, and we are able to monitor inventory levels in the distribution channel, thereby limiting the risk of return.

Reserves for Variable Consideration

Revenues from product sales are recorded at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and which result from discounts, returns, chargebacks, rebates, co-pay assistance and other allowances that are offered within contracts between us and our customers, health care providers, payors and other indirect customers relating to our product sales. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than a customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as our historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect our best estimates of the amount of consideration to which we are entitled based on the terms of the contract. The amount of variable consideration that is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known.

Trade Discounts and Allowances: We generally provide customers with discounts that include incentive fees that are explicitly stated in our contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, we receive sales order management, data and distribution services from certain customers. To the extent the services received are distinct from our sale of products to the customer, these payments are

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classified in selling, general and administrative expenses in the consolidated statements of operations and comprehensive loss.

Product Returns: Consistent with industry practice, we generally offer customers a limited right of return based on the product’s expiration date for product that has been purchased from us, which lapses upon shipment to a patient. We estimate the amount of our product sales that may be returned by our customers and record this estimate as a reduction of revenue in the period the related product revenue is recognized. We currently estimate product return liabilities using available industry data and our own historical sales information, including our visibility into the inventory remaining in the distribution channel.

Provider Chargebacks and Discounts: Chargebacks for fees and discounts to providers represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to customers who directly purchase the product from us. Customers charge us for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. These reserves are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue and accounts receivable. Chargeback amounts are generally determined at the time of resale to the qualified healthcare provider by customers, and we generally issue credits for such amounts within a few weeks of the customer’s notification to us of the resale. Reserves for chargebacks consist of credits that we expect to issue for units that remain in the distribution channel inventories at each reporting period end that we expect will be sold to qualified healthcare providers, and chargebacks that customers have claimed but for which we have not yet issued a credit.

Government Rebates: We are subject to discount obligations under state Medicaid programs and Medicare. We estimate our Medicaid and Medicare rebates based upon a range of possible outcomes that are probability-weighted for the estimated payor mix. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability that is included in accrued expenses on the consolidated balance sheet. For Medicare, we also estimate the number of patients in the prescription drug coverage gap for whom we will owe an additional liability under the Medicare Part D program. Our liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter, and estimated future claims that will be made for product that has been recognized as revenue, but remains in the distribution channel inventories at period end.

Payor Rebates: We may contract with various private payor organizations, primarily insurance companies and pharmacy benefit managers, for the payment of rebates with respect to utilization of our products. We estimate these rebates and record such estimates in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability.

Other Incentives/Patient Assistance Programs: We also offer voluntary patient assistance programs such as co-pay assistance. Co-pay assistance programs are intended to provide financial assistance to qualified commercially insured patients with prescription drug co-payments required by payors. The calculation of the accrual for co-pay assistance is based on an estimate of claims and the cost per claim that we expect to receive associated with product that has been recognized as revenue, but remains in in the distribution channel inventories at period end.

Revenue Recognition – Collaboration Revenue

Effective January 1, 2018, we adopted ASC, Topic 606, Revenue from Contracts with Customers, or ASC 606, using the modified retrospective transition method. Under this method, results for reporting periods beginning after January 1, 2018 are presented pursuant to ASC 606, while prior period amounts are not adjusted and continue to be reported in accordance with ASC 605. This standard applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements and financial instruments. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the

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performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We only apply the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, we assess the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

We have entered into collaboration and license agreements, which are within the scope of ASC 606, to discover, develop, manufacture and commercialize product candidates. The terms of these agreements typically contain multiple promises or obligations, which may include: (i) licenses, or options to obtain licenses, to compounds directed to specific targets (referred to as “exclusive licenses”) and (ii) research and development activities to be performed on behalf of the collaboration partner related to the licensed targets. Payments to us under these agreements may include non-refundable license fees, customer option exercise fees, payments for research activities, reimbursement of certain costs, payments based upon the achievement of certain milestones and royalties on any resulting net product sales.

We first evaluate license and/or collaboration arrangements to determine whether the arrangement (or part of the arrangement) represents a collaborative arrangement pursuant to ASC Topic 808, Collaborative Arrangements, based on the risks and rewards and activities of the parties pursuant to the contractual arrangement. We account for collaborative arrangements (or elements within the contract that are deemed part of a collaborative arrangement), which represent a collaborative relationship and not a customer relationship, outside the scope of ASC 606. Our collaborations primarily represent revenue arrangements. For the arrangements or arrangement components that are subject to revenue accounting guidance, in determining the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements, 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 distinct in the context of the contract; (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 when (or as) we satisfy each performance obligation. As part of the accounting for these arrangements, we must use significant judgment to determine: a) the number of performance obligations based on the determination under step (ii) above and whether those performance obligations are distinct from other performance obligations in the contract; b) the transaction price under step (iii) above; and c) the stand-alone selling price for each performance obligation identified in the contract for the allocation of transaction price in step (iv) above. We use judgment to determine whether milestones or other variable consideration, except for sales-based royalties, should be included in the transaction price as described further below. The transaction price is allocated to each performance obligation on a relative stand-alone selling price basis, for which we recognize revenue as or when the performance obligations under the contract are satisfied. In determining the stand-alone selling price of a license to our proprietary technology or a material right provided by a customer option, we consider market conditions as well as entity-specific factors, including those factors contemplated in negotiating the agreements as well as internally developed estimates that include assumptions related to the market opportunity, estimated development costs, probability of success and the time needed to commercialize a product candidate pursuant to the license. In validating its estimated stand-alone selling price, we evaluate whether changes in the key assumptions used to determine its estimated stand-alone selling price will have a significant effect on the allocation of arrangement consideration between performance obligations.

Amounts received prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Amounts recognized as revenue, but not yet received or invoiced are generally recognized as contract assets.

Exclusive Licenses – If the license to our intellectual property is determined to be distinct from the other promises or performance obligations identified in the arrangement, which generally include research and development services, we recognize revenue from non-refundable, upfront fees allocated to the license when the license is transferred to

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the customer and the customer is able to use and benefit from the license. In assessing whether a license is distinct from the other promises, we consider relevant facts and circumstances of each arrangement, including the research and development capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. In addition, we consider whether the collaboration partner can benefit from the license for its intended purpose without the receipt of the remaining promises, whether the value of the license is dependent on the unsatisfied promises, whether there are other vendors that could provide the remaining promises, and whether it is separately identifiable from the remaining promises. For licenses that are combined with other promises, we utilize judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. We evaluate the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the research and development and licensing agreement.

Research and Development Services – The promises under our collaboration and license agreements generally include research and development services to be performed by us on behalf of the collaboration partner. For performance obligations that include research and development services, we generally recognize revenue allocated to such performance obligations based on an appropriate measure of progress. We utilize judgment to determine the appropriate method of measuring progress for purposes of recognizing revenue, which is generally an input measure such as costs incurred. We evaluate the measure of progress each reporting period as described under Exclusive Licenses above. Reimbursements from the partner that are the result of a collaborative relationship with the partner, instead of a customer relationship, such as co-development activities, are recorded as a reduction to research and development expense.

Customer Options – Our arrangements may provide a collaborator with the right to select a target for licensing either at the inception of the arrangement or within an initial pre-defined selection period, which may, in certain cases, include the right of the collaborator to extend the selection period. Under these agreements, fees may be due to us (i) at the inception of the arrangement as an upfront fee or payment, (ii) upon the exercise of an option to acquire a license or (iii) upon extending the selection period as an extension fee or payment. If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. We evaluate the customer options for material rights, or options to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the inception of the arrangement. We allocate the transaction price to material rights based on the relative stand-alone selling price, which is determined based on the identified discount and the probability that the customer will exercise the option. Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised or expires.

Milestone Payments – At the inception of each arrangement that includes development milestone payments, we evaluate whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within our control or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. We evaluate factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each subsequent reporting period, we reevaluate the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. If a milestone or other variable consideration relates specifically to our efforts to satisfy a single performance obligation or to a specific outcome from satisfying the performance obligation, we generally allocate the milestone amount entirely to that performance obligation once it is probable that a significant revenue reversal would not occur.

Royalties – For arrangements that include sales-based royalties, including milestone payments based on a level of sales, and the license is deemed to be the predominant item to which the royalties relate, we recognize revenue at the

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later of (i) when the related sales occur or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, we have not recognized any royalty revenue resulting from any of our licensing arrangements.

For a complete discussion of accounting for collaboration revenues, see Note 11, Collaborations, in the accompanying Notes to Consolidated Financial Statements included in Item 15. of Part IV of this Annual Report on Form 10-K.

Accrued Research and Development Expenses

As part of the process of preparing our financial statements, we are required to estimate our accrued expenses as of each balance sheet date. This process involves reviewing open contracts and purchase orders, communicating with our personnel to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of the actual cost. The majority of our service providers invoice us monthly in arrears for services performed or when contractual milestones are met. We make estimates of our accrued expenses as of each balance sheet date in our financial statements based on facts and circumstances known to us at that time. We periodically confirm the accuracy of our estimates with the service providers and make adjustments if necessary. Examples of estimated accrued research and development expenses include fees paid to:

•contract research organizations in connection with clinical trials;

•investigative sites in connection with clinical trials;

•vendors in connection with non-clinical development activities; and

•vendors related to product manufacturing, development and distribution of clinical supplies.

We generally accrue expenses related to research and development activities based on the services received and efforts expended pursuant to contracts with multiple contract research organizations that conduct and manage clinical trials on our behalf as well as other vendors that provide research and development services. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows. There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the expense. Payments under some of these contracts depend on factors such as the successful enrollment of subjects and the completion of clinical trial milestones. In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from our estimate, we would adjust the accrual or prepaid accordingly.

Although we do not expect our estimates to be materially different from amounts actually incurred, if our estimates of the status and timing of services performed differ from the actual status and timing of services performed we may report amounts that are too high or too low in any particular period. To date, there have been no material differences from our estimates to the amount actually incurred.

Inventory

We outsource the manufacturing of TAZVERIK and use contract manufacturers to produce the raw and intermediate materials used in the production of TAZVERIK as well as the finished product. We currently have one supplier qualified for each step in the manufacturing process and are in the process of qualifying additional suppliers.

Inventory is composed of raw materials, intermediate materials, which are classified as work-in-process, and finished goods, which are goods that are available for sale. We state inventory at the lower of cost or net realizable value with the cost based on the first-in, first-out method. If we identify excess, obsolete or unsalable items, we write down our inventory to its net realizable value in the period in which the impairment is identified. These adjustments are recorded based upon various factors related to the product, including the level of product manufactured by us, the level of product in the distribution channel, current and projected demand, the expected

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shelf-life of the product and firm inventory purchase commitments. Shipping and handling costs incurred for inventory purchases are included in inventory costs and costs incurred for product shipments are recorded as incurred in cost of product revenue.

Prior to receiving our first approval from the U.S. Food and Drug Administration, or FDA, on January 23, 2020, we expensed all costs incurred related to the manufacture of TAZVERIK as research and development expense because of the inherent risks associated with the development of a product candidate, the uncertainty about the regulatory approval process and the lack of history for us of regulatory approval of drug candidates.

Going Concern

At each reporting period, we evaluate whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company is required to make certain additional disclosures if it concludes substantial doubt exists about the Company's ability to continue as a going concern within one year after the date that the financial statements are issued and such doubt is not alleviated by the Company’s plans or when its plans alleviate substantial doubt about the Company’s ability to continue as a going concern. The Company’s evaluation entails analyzing prospective operating budgets and forecasts for expectations of the Company’s cash needs, and comparing those needs to its available cash, cash equivalents and marketable securities.

The analysis of the Company’s ability to continue as a going concern includes consideration of the Company’s current cash needs, including its research and development plans, commercialization activities associated with the continued commercialization of TAZVERIK in the ES and FL indications, its existing debt service obligations, and anticipated cost savings from its operational cost reduction plans, including ongoing efforts to eliminate costs not related to the Company’s strategic focus. The analysis includes forecasted product revenues from sales of TAZVERIK. Such estimates of future sales contain significant judgment as TAZVERIK was first launched in the first half of 2020 and there is little history with which to base such estimates. In addition, the Company’s ongoing efforts to eliminate costs not related to the Company’s strategic focus contains uncertainties as to whether the Company can attain such benefits.

Based on its analysis, the Company concluded that its available cash, cash equivalents and marketable securities as of December 31, 2021 combined with the $79.5 million raised in January 2022 will be sufficient to fund current planned operations and capital expenditure requirements and pay its debt service obligations as they become due into the third quarter of 2023, which is at least 12 months from the filing date of this Annual Report on Form 10-K with the SEC. As a result, the Company concluded that it did not identify conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date these financial statements were issued. The Company’s current operating plan is based on assumptions that may prove to be wrong, and the Company could use its capital resources sooner than it expects, in which case the Company would evaluate further reductions in its expenses or obtaining additional financing sooner than it otherwise would, which additional financing may not be available or may only be available on terms that are not acceptable to the Company.

Recently Adopted Accounting Pronouncements

For detailed information regarding recently issued accounting pronouncements and the expected impact on our consolidated financial statements, see Note 2, Summary of Significant Accounting Policies—Recently Adopted Accounting Pronouncements, in the accompanying Notes to Consolidated Financial Statements included in Item 15. of Part IV of this Annual Report on Form 10-K.

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Item 7A. Quantitative and Qualitative Disclosures about Market Risk

The market risk inherent in our financial instruments and in our financial position represents the potential loss arising from adverse changes in interest rates. As of December 31, 2021, we had cash equivalents and available for sale securities of $176.8 million consisting of money market funds, corporate bonds, commercial paper and government-related obligations. Our primary exposure to market risk is interest rate sensitivity, which is affected by changes in the general level of U.S. interest rates. We estimate that a hypothetical 100-basis point change in market interest rates would impact the fair value of our investment portfolio as of December 31, 2021 by $0.1 million.

We contract with contract research organizations and manufacturers globally. Transactions with these providers are predominantly settled in U.S. dollars and, therefore, we believe that we have only minimal exposure to foreign currency exchange risks. We do not hedge against foreign currency risks.

Item 8. Financial Statements and Supplementary Data

The information required by this item may be found on pages F-2 through F-32 as listed below, including the quarterly information required by this item.

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INDEX

	Page
Report of Independent Registered Public Accounting Firm (PCAOB ID: 42)	F-2
Consolidated Balance Sheets	F-4
Consolidated Statements of Operations and Comprehensive Loss	F-5
Consolidated Statements of Cash Flows	F-6
Consolidated Statements of Stockholders’ Equity	F-7
Notes to Consolidated Financial Statements	F-8

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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act) as of December 31, 2021. In designing and evaluating our disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and our management necessarily applied its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on this evaluation, our principal executive officer and principal financial officer concluded that as of December 31, 2021, our disclosure controls and procedures were (1) designed to ensure that material information relating to us is made known to our management including our principal executive officer and principal financial officer by others, particularly during the period in which this report was prepared and (2) effective, in that they provide reasonable assurance that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

•pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of our company;

•provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of our company are being made only in accordance with authorizations of our management and directors; and

•provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2021. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission, or COSO, in Internal Control—Integrated Framework (2013). Based on its assessment, management believes that, as of December 31, 2021, our internal control over financial reporting is effective based on those criteria.

Ernst & Young LLP, our independent registered public accounting firm has audited the consolidated financial statements included in this Annual Report on Form 10-K and, as part of the audit, has issued a report on the effectiveness of our internal control over financial reporting as of December 31, 2021, which report is included herein.

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Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Epizyme, Inc.

Opinion on Internal Control over Financial Reporting

We have audited Epizyme, Inc.’s internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Epizyme, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2021 and 2020, the related consolidated statements of operations and comprehensive loss, stockholders’ equity (deficit) and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and our report dated March 1, 2022 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Ernst & Young LLP

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Boston, Massachusetts

March 1, 2022

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) during the quarter ended December 31, 2021 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information

On February 25, 2022, our Board of Directors approved a reduction in our workforce by approximately 12% across different areas and functions in the Company. This workforce reduction is expected to be completed by the end of the first quarter of 2022.

Affected employees will be offered separation benefits, including severance payments along with temporary healthcare coverage assistance. We estimate that the severance and termination-related costs will be approximately $2.8 - 3.2 million and we expect to record these charges in the first quarter of 2022. The Company expects that payments of these costs will be made through the end of the fourth quarter of 2022.

Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections

Not applicable.

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PART III

Item 10. Directors, Executive Officers and Corporate Governance

Information regarding our directors, including the audit committee and audit committee financial experts, and executive officers and compliance with Section 16(a) of the Exchange Act will be included in our 2022 Proxy Statement and is incorporated herein by reference.

We have adopted a Code of Business Conduct and Ethics for all of our directors, officers and employees as required by NASDAQ governance rules and as defined by applicable SEC rules. Stockholders may locate a copy of our Code of Business Conduct and Ethics on our website at www.epizyme.com or request a copy without charge from:

Epizyme, Inc.

Attention: Investor Relations

400 Technology Square, 4th Floor

Cambridge, MA 02139

We will post to our website any amendments to the Code of Business Conduct and Ethics, and any waivers that are required to be disclosed by the rules of either the SEC or NASDAQ.

Item 11. Executive Compensation

The information required by this item regarding executive compensation will be included in our 2022 Proxy Statement and is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this item regarding security ownership of certain beneficial owners and management and securities authorized for issuance under equity compensation plans will be included in our 2022 Proxy Statement and is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information required by this item regarding certain relationships and related transactions and director independence will be included in our 2022 Proxy Statement and is incorporated herein by reference.

Item 14. Principal Accounting Fees and Services

The information required by this item regarding principal accounting fees and services will be included in our 2022 Proxy Statement and is incorporated herein by reference.

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PART IV

Item 15. Exhibits, Financial Statement Schedules

(a)The following documents are included in this Annual Report on Form 10-K:

1.The following Report and Consolidated Financial Statements of the Company are included in this Annual Report:

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets

Consolidated Statements of Operations and Comprehensive Loss

Consolidated Statements of Cash Flows

Consolidated Statements of Stockholders’ Equity

Notes to Consolidated Financial Statements

2.All financial schedules have been omitted because the required information is either presented in the consolidated financial statements or the notes thereto or is not applicable or required.

3.Exhibits:

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Exhibit Number		Description of Exhibit
3.1		Restated Certificate of Incorporation of the Registrant, as amended (19)
3.2		Amended and Restated Bylaws of the Registrant (2)
4.1		Form of Series A Preferred Stock Certificate (15)
4.2		Certificate of Designation of Series A Convertible Preferred Stock of the Company (15)
4.3		Description of Securities of the Registrant (18)
10.1+		2008 Stock Incentive Plan (1)
10.2+		Form of Incentive Stock Option Agreement under 2008 Stock Incentive Plan (1)
10.3+		Form of Nonstatutory Stock Option Agreement under 2008 Stock Incentive Plan (1)
10.4+		Form of Restricted Stock Agreement under 2008 Stock Incentive Plan (1)
10.5+		2013 Stock Incentive Plan, as amended on March 24, 2020 (16)
10.6+		Form of Stock Option Agreement under 2013 Stock Incentive Plan (18)
10.7+		Form of Restricted Stock Agreement under 2013 Stock Incentive Plan (2)
10.8+		Form of Restricted Stock Unit Agreement under 2013 Stock Incentive Plan (18)
10.9+		2013 Employee Stock Purchase Plan (2)
10.10+		Executive Severance and Change in Control Plan (11)
10.11+	Form of Restricted Stock Unit Agreement (Inducement Grant) (22)
10.12+	Form of Restricted Stock Unit Agreement (Inducement Grant) (22)
10.13+		Employment Offer Letter between the Registrant and Robert Bazemore, dated August 5, 2015 (5)
10.14+		Employment Offer Letter between the Company and Matthew E. Ros, dated April 15, 2016 (6)
10.15+		Employment Offer Letter between the Registrant and Paolo Tombesi, dated July 1, 2019 (13)
10.16+		Employment Offer Letter between the Company and Shefali Agarwal, dated June 18, 2018 (10)
10.17+		Employment Offer Letter between the Company and Jeffery Kutok, dated February 21, 2020 (16)
10.18+		Employment Offer Letter between the Company and Victoria Vakiener, dated October 23, 2018 (17)
10.19+		Employment Offer Letter between the Company and Grant Bogle, dated August 4, 2021 (22)
10.20+		Consulting Agreement dated August 4, 2021 between the Company and Robert B. Bazemore (22)
10.21		Form of Director and Officer Indemnification Agreement (2)
10.22☐		Companion Diagnostics Agreement dated as of December 18, 2012 between the Registrant and Eisai Co., Ltd. on the one side and Roche Molecular Systems, Inc. on the other side (23)
10.23☐		First Amendment to the Companion Diagnostics Agreement dated October 23, 2013 between the Registrant and Eisai Co. Ltd. on the one side and Roche Molecular Systems, Inc. on the other side (23)
10.24☐		Second Amendment to the Companion Diagnostics Agreement dated November 16, 2015 between the Registrant and Eisai Co. Ltd. on the one side and Roche Molecular Systems, Inc. on the other side (23)

119

10.25†		Third Amendment to the Companion Diagnostics Agreement dated March 7, 2018 between the Registrant and Eisai Co. Ltd. on the one side and Roche Molecular Systems, Inc. on the other side (9)
10.26		Amended and Restated Letter Agreement dated as of March 12, 2015 by and between the Registrant and Eisai Co., Ltd. relating to the Companion Diagnostics Agreement (4)
10.27☐		Amended and Restated Collaboration and License Agreement dated as of March 12, 2015, by and between the Registrant and Eisai Co. Ltd. (17)
10.28		Lease Agreement dated as of June 15, 2012 between the Registrant and ARE-TECH Square, LLC (1)
10.29+		Non-Employee Director Compensation Program, effective January 1, 2021 (17)
10.30		First Amendment to Lease Agreement dated as of September 30, 2013 between the Registrant and ARE-TECH Square, LLC (3)
10.31		Second Amendment to Lease Agreement dated as of May 18, 2016 between the Registrant and ARE-TECH Square, LLC (7)
10.32		Third Amendment to Lease Agreement, entered into May 25, 2017 and effective May 18, 2017, by and between the Company and ARE-TECH Square, LLC (8)
10.33		Fourth Amendment to Lease Agreement, entered into May 25, 2017 and effective May 18, 2017, by and between the Company and ARE-TECH Square, LLC (8)
10.34☐		Fourth Amendment to the Companion Diagnostics Agreement dated July 26, 2019 between the Registrant and Eisai Co. Ltd. on the one side and Roche Molecular Systems, Inc. and Roche Sequencing Solutions, Inc. on the other side. (14)
10.35		Lease Agreement dated as of August 16, 2019 by and between the Registrant and BMR-Hampshire LLC. (14)
10.36		Amended and Restated Loan Agreement dated as of November 3, 2020 by and among the Registrant and BioPharma Credit Investments V (Master) LP, BPCR Limited Partnership and BioPharma Credit PLC (17)
10.37		Guaranty and Security Agreement dated as of November 18, 2019 by and between the Registrant and BioPharma Credit PLC (15)
10.38☐		Purchase Agreement dated as of November 4, 2019 by and between the Registrant and RPI Finance Trust (15)
10.39		Warrant Agreement dated as of November 4, 2019 by and between the Registrant and RPI Finance Trust (15)
10.40	Fifth Amendment to Lease Agreement, dated as of August 11, 2021, by and between the Company and ARE-TECH Square, LLC (20)
10.41☐	License Agreement dated August 7, 2021 between the Registrant and Hutchison China MediTech Investment Limited (22)
10.42	Warrant to Purchase Stock, dated August 7, 2021, by and between the Registrant and Hutchison China MediTech Investment Limited (21)
10.43+	Consulting Agreement, dated October 1, 2021, by and between the Registrant and Victoria Vakiener (23)
10.44+	Consulting Agreement, dated October 27, 2021, by and between the Registrant and Matthew Ros (23)
21.1		Subsidiaries of the Registrant (1)
23.1		Consent of Ernst & Young LLP (23)

120

31.1	Certification of Principal Executive Officer pursuant to Rules 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (23)
31.2	Certification of Principal Financial Officer pursuant to Rules 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (23)
32.1	Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of The Sarbanes-Oxley Act of 2002, by Grant Bogle, President and Chief Executive Officer of the Company. (23)
101	The following financial statements formatted in XBRL: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Net Income, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Changes in Stockholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) the Notes to the Consolidated Financial Statements.
101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL 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 Labels Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

+ Management compensatory agreement.

† Confidential treatment has been granted as to portions of the exhibit. Confidential materials omitted and filed separately with the Securities and Exchange Commission.

☐ Portions of this exhibit have been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K

(1)Incorporated by reference to the Registration Statement on Form S-1 (File No. 333-187982) filed with the Securities and Exchange Commission on April 18, 2013.

(2)Incorporated by reference to the Registration Statement on Form S-1/A (File No. 333-187892) filed with the Securities and Exchange Commission on April 26, 2013.

(3)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on October 23, 2013.

(4)Incorporated by reference to the Registrant’s Current Report on Form 8-K (File No. 001-35945) filed with the Securities and Exchange Commission on March 16, 2015.

(5)Incorporated by reference to the Registrant’s Current Report on Form 8-K (File No. 001-35945) filed with the Securities and Exchange Commission on August 6, 2015.

(6)Incorporated by reference to the Registrant’s Current Report on Form 8-K (File No. 001-35945) filed with the Securities and Exchange Commission on May 6, 2016.

(7)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on August 8, 2016.

(8)Incorporated by reference to the Current Report on Form 8-K (File No. 001-35945) filed with the Securities and Exchange Commission on May 30, 2017.

(9)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on May 8, 2018.

121

(10)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on November 2, 2018.

(11)Incorporated by reference to the Annual Report on Form 10-K (File No. 001-35945) filed with the Securities and Exchange Commission on February 26, 2019.

(12)Incorporated by reference to the Current Report on Form 8-K (File No. 001-35945) filed with the Securities and Exchange Commission on March 7, 2019.

(13)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on August 9, 2019.

(14)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on October 31, 2019.

(15)Incorporated by reference to the Annual Report on Form 10-K (File No. 001-35945) filed with the Securities and Exchange Commission on February 27, 2020.

(16)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on May 4, 2020.

(17)Incorporated by reference to the Annual Report on Form 10-K (File No. 001-35945) filed with the Securities and Exchange Commission on February 23, 2021.

(18)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on May 6, 2021.

(19)Incorporated by reference to the Quarterly Report on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on August 9, 2021.

(20)Incorporated by reference to the Registrant’s Current Report on Form 8-K (File No. 001-35945) filed with the Securities and Exchange Commission on August 16, 2021.

(21)Incorporated by reference to the Registration Statement on Form S-3 (File No. 333-259680) filed with the Securities and Exchange Commission on September 21, 2021.

(22)Incorporated by reference to the Registration Statement on Form 10-Q (File No. 001-35945) filed with the Securities and Exchange Commission on November 9, 2021.

(23)Filed with this Annual Report on Form 10-K.
 

122

Item 16. Form 10-K Summary

Not applicable.

123

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

	Epizyme, Inc.
By:	/s/ Grant Bogle
	Grant Bogle
	President and Chief Executive Officer

Dated: March 1, 2022

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:

Name	Title	Date
/s/ Grant Bogle	President, Chief Executive Officer, Director	March 1, 2022
Grant Bogle	(Principal Executive Officer and Principal Financial Officer)
/s/ Joseph Beaulieu	Vice President, Corporate Controller and Treasurer	March 1, 2022
Joseph Beaulieu	(Principal Accounting Officer)
/s/ Kenneth Bate	Director	March 1, 2022
Kenneth Bate
/s/ Roy Beveridge	Director	March 1, 2022
Roy Beveridge
/s/ Kevin T. Conroy	Director	March 1, 2022
Kevin T. Conroy
/s/ Michael Giordano	Director	March 1, 2022
Michael Giordano, M.D.
/s/ Carl Goldfischer	Director	March 1, 2022
Carl Goldfischer, M.D.
/s/ Pablo Legorreta	Director	March 1, 2022
Pablo Legorreta
/s/ David M. Mott	Director	March 1, 2022
David M. Mott
/s/ Victoria Richon	Director	March 1, 2022
Victoria Richon, Ph.D.
/s/ Carol Stuckley	Director	March 1, 2022
Carol Stuckley

124

EPIZYME, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm		F-2
Consolidated Balance Sheets		F-4
Consolidated Statements of Operations and Comprehensive Loss		F-5
Consolidated Statements of Cash Flows		F-6
Consolidated Statements of Stockholders’ Equity (Deficit)		F-7
Notes to Consolidated Financial Statements	F-8

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors of Epizyme, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Epizyme, Inc. (the Company) as of December 31, 2021 and 2020, the related consolidated statements of operations and comprehensive loss, stockholders' equity (deficit) and cash flows for each of the three years in the period ended December 31, 2021, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2021, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 1, 2022 expressed an unqualified opinion thereon.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

F-2

	Accrued and Prepaid Clinical Trial Expenses
Description of the Matter	The Company’s total accrued expenses were $30.8 million at December 31, 2021, which included the estimated obligation for clinical trial expenses incurred as of December 31, 2021 but not paid as of that date. In addition, the Company’s total prepaid expenses and other current assets were $19.5 million, which included amounts that were paid in advance of services incurred pursuant to clinical trials. As discussed in Note 2 to the consolidated financial statements, when vendors billing terms do not coincide with the Company’s period-end, the Company is required to make estimates of its obligations to those vendors, including clinical trial and pharmaceutical development costs, contractual services costs and costs for supply of its product candidates incurred in a given accounting period and record accruals at the end of the period. The Company bases its estimates on its knowledge of the research and development programs, services performed for the period, past history for related activities and the expected duration of the vendor service contract, where applicable. Payments for these activities are based on the terms of the individual arrangements and may result in payment terms that differ from the pattern of costs incurred. There may be instances in which payments made to vendors will exceed the level of services provided and result in a prepayment of the clinical expense. Auditing the Company’s accrued and prepaid clinical trial expenses is especially challenging due to the large volume of information received from multiple vendors that perform service on the Company’s behalf. While the Company’s estimates of accrued and prepaid clinical trial expenses are primarily based on information received related to each study from its vendors, the Company may need to make an estimate for additional costs incurred. Additionally, due to the long duration of clinical trials and the timing of invoicing received from vendors, the actual amounts incurred are not typically known at the time the financial statements are issued.
How We Addressed the Matter in Our Audit	We evaluated and tested the design and operating effectiveness of internal controls over the Company’s process used in determining the valuation and completeness of accrued and prepaid clinical trial expenses. To evaluate the accrued and prepaid clinical trial expenses, our audit procedures included, among others, testing the accuracy and completeness of the underlying data used in determining the accrued and prepaid clinical trial expenses and evaluating the assumptions/estimates used by management to adjust the actual information received. To assess the nature and extent of the services incurred, we corroborated the progress of clinical trials with the Company’s research and development personnel that oversee the clinical trials and obtained information directly from vendors of their costs incurred to date. To evaluate the completeness and valuation of the accrual, we also tested subsequent invoices received and inspected the Company’s contracts with vendors and any pending change orders to assess the impact to the accrual.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2009.

Boston, Massachusetts

March 1, 2022

F-3

EPIZYME, INC.

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands except per share data)

	December 31, 2021			December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	98,336		$	168,215
Marketable securities		78,454			205,391
Accounts receivable, net		6,572			3,105
Inventory		3,216			10,461
Prepaid expenses and other current assets		19,465			17,921
Total current assets		206,043			405,093
Property and equipment, net		1,545			2,152
Operating lease assets		20,054			17,305
Intangible assets, net		42,849			47,002
Restricted cash and other assets		18,509			2,021
Total assets	$	289,000		$	473,573
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	10,265		$	10,163
Accrued expenses		30,777			28,572
Current portion of operating lease obligation		4,154			4,665
Total current liabilities		45,196			43,400
Operating lease obligation, net of current portion		18,497			15,409
Deferred revenue		11,950			—
Related party long-term debt, net of debt discount		216,461			215,670
Other long-term liabilities		-			21
Related party liability related to sale of future royalties, net of current portion		15,654			14,176
Warrants to purchase common stock		1,930			—
Commitments and contingencies
Stockholders’ equity (deficit):
Preferred stock, $0.0001 par value; 5,000 shares authorized; 338 shares and 338 shares issued and outstanding, respectively (equivalent to 3,378 shares and 3,378 shares of common stock, respectively, upon conversion at a 10:1 ratio)		36,127			36,127
Common stock, $0.0001 par value; 150,000 shares and 125,000 shares, respectively, authorized; 106,098 shares and 101,627 shares  issued and outstanding, respectively		11			10
Additional paid-in capital		1,183,006			1,137,470
Accumulated other comprehensive loss		3			3
Accumulated deficit		(1,239,835	)		(988,713	)
Total stockholders’ equity (deficit)		(20,688	)		184,897
Total liabilities and stockholders’ equity (deficit)	$	289,000		$	473,573

See notes to consolidated financial statements.

F-4

EPIZYME, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Amounts in thousands except per share data)

	Year Ended December 31,
	2021			2020			2019
Revenue:
Product revenue, net	$	30,922		$	11,469		$	—
Collaboration and other revenue		6,505			4,293			23,800
Total revenue		37,427			15,762			23,800
Operating expenses:
Cost of revenue		10,498			5,067			—
Research and development		130,966			110,933			132,639
Selling, general and administrative		133,955			125,178			68,303
Total operating expenses		275,419			241,178			200,942
Operating loss		(237,992	)		(225,416	)		(177,142	)
Other (expense) income, net:
Interest (expense) income, net		(22,380	)		(4,682	)		7,110
Other expense, net		(66	)		(99	)		(13	)
Change in fair value of warrants to purchase common stock		11,120			—			—
Related party non-cash interest expense related to sale of future royalties		(1,782	)		(1,383	)		(192	)
Other (expense) income, net		(13,108	)		(6,164	)		6,905
Loss before income taxes		(251,100	)		(231,580	)		(170,237	)
Income tax provision		(22	)		(114	)		(58	)
Net loss	$	(251,122	)	$	(231,694	)	$	(170,295	)
Other comprehensive (loss) income:
Unrealized gain (loss) on available for sale securities		—			(16	)		73
Comprehensive loss	$	(251,122	)	$	(231,710	)	$	(170,222	)
Reconciliation of net loss to net loss attributable to common stockholders:
Net loss	$	(251,122	)	$	(231,694	)	$	(170,295	)
Accretion of convertible preferred stock		—			—			(2,940	)
Net loss attributable to common stockholders	$	(251,122	)	$	(231,694	)	$	(173,235	)
Net loss per share attributable to common stockholders:
Basic	$	(2.45	)	$	(2.29	)	$	(1.93	)
Diluted	$	(2.45	)	$	(2.29	)	$	(1.93	)
Weighted-average common shares outstanding used in net loss per share attributable to common stockholders:
Basic		102,646			100,960			89,891
Diluted		102,646			100,960			89,891

See notes to consolidated financial statements.

F-5

EPIZYME, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

	Year Ended December 31,
	2021			2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(251,122	)	$	(231,694	)	$	(170,295	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		5,246			3,984			840
Stock-based compensation		26,787			27,609			18,016
Amortization of discount (premium) on investments		970			(93	)		(3,175	)
Amortization of debt discount		791			406			37
Change in fair value of warrant liability		(11,120	)		-			—
Loss on disposal of property and equipment		-			19			—
Non-cash royalty revenue related to sale of future royalties		(31	)
Non-cash interest expense associated with the sale of future royalties		1,782			1,383			192
Deferred income taxes		—			92			92
Changes in operating assets and liabilities:
Accounts receivable		(3,467	)		(538	)		17,500
Inventory		(8,224	)		(10,461	)		—
Prepaid expenses and other current assets		(1,605	)		(2,398	)		(3,359	)
Accounts payable		84			1,480			3,389
Accrued expenses		1,771			6,006			2,897
Deferred revenue		11,950			(3,806	)		(13,300	)
Operating lease assets		(2,749	)		3,901			(9,921	)
Operating lease liabilities		2,577			(2,085	)		10,043
Other assets and liabilities		(493	)		(141	)		(124	)
Net cash used in operating activities		(226,853	)		(206,336	)		(147,168	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of available-for-sale securities		(262,613	)		(276,404	)		(504,981	)
Maturities of available-for-sale securities		388,581			312,694			420,255
Purchase of intangible asset					(50,000	)		—
Purchases of property and equipment		(486	)		(880	)		(594	)
Net cash provided by (used in) investing activities		125,482			(14,590	)		(85,320	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock, net of commissions		15,954			-			122,991
Proceeds from issuance of preferred stock, net of commissions		—			-			37,432
Payment of offering costs		(308	)		(79	)		(284	)
Proceeds from the issuance of debt		—			195,000			25,000
Proceeds from the issuance of warrants		13,050
Payment of debt issuance costs		—			(3,123	)		(1,650	)
Proceeds from the issuance of common stock, warrants, and sale of future royalties to RPI, net of offering costs		—			—			99,774
Proceeds from the issuance of common stock in connection with the exercise of the Put Option, net of financing costs		—			49,915			—
Payment under capital lease obligation		—			—			(16	)
Proceeds from stock options exercised		916			6,692			2,358
Issuance of shares under employee stock purchase plan		1,880			1,254			741
Net cash provided by financing activities		31,492			249,659			286,346
Net increase (decrease) in cash, cash equivalents and restricted cash		(69,879	)		28,733			53,858
Cash, cash equivalents, and restricted cash, beginning of period		169,724			140,991			87,133
Cash, cash equivalents, and restricted cash, end of period	$	99,845		$	169,724		$	140,991
SUPPLEMENTAL CASH FLOW INFORMATION:
Unpaid offering costs	$	179		$	—		$	78
Unpaid debt issuance costs	$	—		$	—		$	78
Interest paid	$	21,748		$	7,461		$	—
Property and equipment included in accounts payable or accruals	$	—		$	60		$	454
Cash paid for income taxes	$	104		$	64		$	45

See notes to consolidated financial statements

F-6

EPIZYME, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(Amounts in thousands except share data)

	Common Stock				Preferred Stock						Additional Paid-In			Accumulated			Accumulated Other Comprehensive			Total Stockholders’
	Shares		Amount		Shares			Amount			Capital			Deficit			Loss			Equity (Deficit)
Balance at December 31, 2018		79,175,380	$	8		—		$	—		$	819,779		$	(586,724	)	$	(54	)	$	233,009
Issuance of series A convertible preferred stock, net of commissions and beneficial conversion charge		—		—		350,000			34,492			2,940						—			37,432
Accretion of series A convertible preferred stock		—		—		—			2,940			(2,940	)		—			—			—
Issuance of common stock (net of commissions and offering costs of $284)		11,500,000		1		—			—			122,707			—			—			122,708
Issuance of common stock to Royalty Pharma (net of commissions and offering costs of $304)		6,666,667		1		—			—			78,704			—			—			78,705
Issuance of warrant to Royalty Pharma		—		—		—			—			8,390			—			—			8,390
Exercise of stock options and vesting of restricted stock units		356,538		—		—			—			2,358			—			—			2,358
Stock-based compensation		—		—		—			—			17,875			—			—			17,875
Issuance of shares of common stock in lieu of board fees		12,156		—		—			—			141			—			—			141
Issuance of shares under employee stock purchase plan		72,735		—		—			—		741				—			—			741
Unrealized gain on available for sale securities		—		—		—			—			—			—			73			73
Net loss		—		—		—			—			—			(170,295	)		—			(170,295	)
Balance at December 31, 2019		97,783,476	$	10		350,000		$	37,432		$	1,050,695		$	(757,019	)	$	19		$	331,137
Issuance of common stock in connection with the exercise of the Put Option (net of financing costs of $85)		2,500,000		—		—			—			49,915						—			49,915
Issuance of common stock in connection with the conversion of series A convertible preferred stock		122,000		—		(12,200	)		(1,305	)		1,305			—			—			—
Exercise of stock options and vesting of restricted stock units		1,097,280		—		—			—			6,692			—			—			6,692
Stock-based compensation		—		—		—			—			27,471			—			—			27,471
Issuance of shares of common stock in lieu of board fees		8,683		—		—			—			138			—			—			138
Issuance of shares under employee stock purchase plan		115,631		—		—			—			1,254			—			—			1,254
Unrealized loss on available for sale securities		—		—		—			—			—			—			(16	)		(16	)
Net loss		—		—		—			—			—			(231,694	)		—			(231,694	)
Balance at December 31, 2020		101,627,070	$	10		337,800		$	36,127		$	1,137,470		$	(988,713	)	$	3		$	184,897
Issuance of common stock (net of commissions and offering costs of $515)		3,840,977		1		—			—			15,953			—			—			15,954
Exercise of stock options and vesting of restricted stock units		290,872		—		—			—			916			—			—			916
Stock-based compensation				—		—			—			26,597			—			—			26,597
Issuance of shares of common stock in lieu of board fees		35,365		—		—			—			190			—			—			190
Issuance of shares under employee stock purchase plan		303,244		—		—			—			1,880			—			—			1,880
Unrealized loss on available for sale securities		—		—		—			—			—			—			—			—
Net loss		—		—		—			—			—			(251,122	)		—			(251,122	)
Balance at December 31, 2021		106,097,528	$	11		337,800		$	36,127		$	1,183,006		$	(1,239,835	)	$	3		$	(20,688	)

See notes to consolidated financial statements.

F-7

EPIZYME, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. The Company

Epizyme, Inc. (collectively referred to with its wholly owned, controlled subsidiary, Epizyme Securities Corporation, as “Epizyme” or the “Company”) is a commercial-stage biopharmaceutical company that is committed to rewriting treatment for people with cancer through the discovery, development, and commercialization of novel epigenetic medicines. The Company aspires to change the standard of care for patients and physicians by developing targeted medicines with fundamentally new mechanisms of action directed at specific causes of hematological malignancies and solid tumors.

Through December 31, 2021, in addition to revenues from product sales, the Company has raised, an aggregate of $1,568.3 million to fund its operations. This includes $268.8 million of non-equity funding through its collaboration agreements, $368.1 million of funding, consisting of $150.0 million in equity funding received through agreements with RPI Finance Trust ("RPI"), and $218.1 million in debt financing received through a loan agreement with BioPharma Credit Investments V (Master) LP and BPCR Limited Partnership (as transferee of BioPharma Credit Investments V (Master) LP’s interest as a lender), ("the Lenders"), $855.4 million from the sale of common stock and series A convertible preferred stock in the Company’s public and at-the-market offerings and $76.0 million from the sale of redeemable convertible preferred stock in private financings prior to the Company’s initial public offering in May 2013. As of December 31, 2021, the Company had $176.8 million in cash, cash equivalents and marketable securities.

In 2020, the Company’s EZH2 inhibitor, tazemetostat, was approved in the United States as TAZVERIK for the treatment of epithelioid sarcoma ("ES") and follicular lymphoma ("FL"). Commercial sales of TAZVERIK for the treatment of ES commenced in the first quarter of 2020 and commercial sales of TAZVERIK for the treatment of FL commenced in the second quarter of 2020.

The Company commenced active operations in early 2008. Since its inception, the Company has generated an accumulated deficit of $1,239.8 million through December 31, 2021 and will require substantial additional capital to fund its research, development, and commercialization efforts. The Company is subject to risks common to companies in the biotechnology industry, including, but not limited to, risks of failure of commercialization, clinical trials and preclinical studies, the need to obtain additional financing to fund the future development and commercialization of tazemetostat and the rest of its pipeline, the need to obtain marketing approval for its product candidates, the need to successfully commercialize and gain market acceptance TAZVERIK and of any product candidates that may be approved in the future, the impact of the COVID-19 pandemic on the Company’s business, results of operations, and financial condition, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations and ability to transition from clinical-stage manufacturing to commercial-stage production, marketing and sale of products.

Operating Cost Reduction

On August 9, 2021, the Company announced a cross-functional reduction of approximately 11% of its then current workforce under a cost reduction plan. Affected employees were offered separation benefits, including severance payments along with temporary healthcare coverage assistance. The severance and termination-related costs totaled approximately $2.0 million, $1.6 million of which were recorded as selling general and administrative expenses and $0.4 million of which was recorded as research and development expenses in the third quarter of 2021. The Company expects that payments of these costs will be made through August 2022.

F-8

2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The consolidated financial statements of the Company included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC, and in accordance with U.S. generally accepted accounting principles, or GAAP. Any reference in these notes to applicable guidance is meant to refer to the authoritative accounting principles generally accepted in the United States as found in the ASC and Accounting Standards Update, or ASU, of the Financial Accounting Standards Board, or FASB. The consolidated financial statements include the accounts of Epizyme, Inc. and its wholly owned, controlled subsidiary, Epizyme Securities Corporation. All intercompany transactions and balances of subsidiaries have been eliminated in consolidation.

Use of Estimates

The preparation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities, as of the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results and outcomes may differ materially from management’s estimates, judgments and assumptions.

Subsequent Events

The Company considers events or transactions that occur after the balance sheet date but before the consolidated financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. The Company evaluated all events and transactions through the date these financial statements were filed with the Securities and Exchange Commission.

Cash and cash equivalents

The Company considers all highly liquid securities with original final maturities of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents are comprised of demand deposit accounts, funds in money market accounts, commercial paper and corporate notes.

Marketable securities

The Company classifies marketable securities with a remaining maturity when purchased of greater than three months as available-for-sale. The Company considers all available-for-sale securities, including those with maturity dates beyond 12 months, as available to support current operational liquidity needs and therefore classifies all securities with maturity dates beyond 90 days at the date of purchase as current assets. Available-for-sale securities are maintained by the Company’s investment managers and may consist of commercial paper, high-grade corporate notes, U.S. Treasury securities, and U.S. government agency securities. Available-for-sale securities are carried at fair value with the unrealized gains and losses included in other comprehensive loss as a component of stockholders’ equity until realized. Any premium or discount arising at purchase is amortized and/or accreted to interest income and/or expense over the life of the instrument. Realized gains and losses are determined using the specific identification method and are included in other income (expense).

The aggregate fair value of securities held by the Company in an unrealized loss position for less than twelve months as of December 31, 2021 was $28.6 million, which consisted of 4 commercial paper securities and 6 U.S. Treasury securities. There were no marketable securities held by the Company for greater than twelve months as of December 31, 2021. The aggregate fair value of securities held by the Company in an unrealized loss position for less than twelve months as of December 31, 2020 was $67.7 million, which consisted of 6 commercial paper securities, 7 corporate notes securities and 1 U.S. Treasury security. There were no marketable securities held by the Company for greater than twelve months as of December 31, 2020.

The Company does not intend to sell and it is unlikely that the Company will be required to sell the above investments before recovery of their amortized cost bases, which may be maturity. The Company determined there

F-9

was no material change in the credit risk of the above investments, and as a result, the Company determined it did not hold any investments with an other-than-temporary impairment as of December 31, 2021 and 2020. The Company reviews its portfolio of available-for-sale debt securities, using both quantitative and qualitative factors, to determine if declines in fair value below cost have resulted from a credit-related loss or other factors. If the decline in fair value is due to credit-related factors, a loss is recognized in net income, whereas if the decline in fair value is not due to credit-related factors, the loss is recorded in other comprehensive income (loss).

The following table summarizes the available for sale securities held at December 31, 2021 (in thousands):

Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Commercial paper	$	68,427	$	7	$	(3	)	$	68,431
Corporate notes		—		—		—			—
U.S. government agency securities and U.S. Treasuries		10,025		—		(1	)		10,024
Total	$	78,452	$	7	$	(4	)	$	78,455

The following table summarizes the available for sale securities held at December 31, 2020 (in thousands):

Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Commercial paper	$	158,907	$	14	$	(8	)	$	158,913
Corporate notes		33,437		3		(7	)		33,433
U.S. government agency securities and U.S. Treasuries		13,044		1		—			13,045
Total	$	205,388	$	18	$	(15	)	$	205,391

Certain short-term debt securities with original maturities of less than 90 days are included in cash and cash equivalents within the consolidated balance sheets and are not included in the tables above.

All marketable securities held at December 31, 2021 and December 31, 2020 have maturities of less than one year.

The amortized cost of available-for-sale securities is adjusted for amortization of premiums and accretion of discounts to maturity. At December 31, 2021, the balance in the Company’s accumulated other comprehensive loss was composed mainly of activity related to the Company’s available-for-sale marketable securities. There were no realized gains or losses recognized on the sale or maturity of available-for-sale securities during the year ended December 31, 2021 and December 31, 2020, respectively, and as a result, the Company did not reclassify any amounts out of accumulated other comprehensive loss for the same period.

Restricted Cash

A reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows, is as follows:

	December 31,
	2021		2020		2019
	(In thousands)
Cash and cash equivalents	$	98,336	$	168,215	$	139,482
Restricted cash, as part of other assets		1,509		1,509	1509
Total cash, cash equivalents, and restricted cash
shown in the consolidated statements of cash flows	$	99,845	$	169,724	$	140,991

F-10

The $1.5 million in restricted cash is comprised of $0.5 million in a letter of credit as a security deposit for the office and laboratory lease at Technology Square in Cambridge, Massachusetts and $1.0 million in a letter of credit as a security deposit for the Company’s office lease at Hampshire Street in Cambridge, Massachusetts. The Company has recorded cash held to secure these letters of credit as restricted cash in restricted cash and other assets on the consolidated balance sheet. The restricted cash is classified as non-current based on the related lease terms.

Fair Value Measurements

The FASB Codification Topic 820, Fair Value Measurements and Disclosures, requires the use of valuation techniques that are consistent with the market approach, the income approach and/or the cost approach. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. The income approach uses valuation techniques to convert future amounts, such as cash flows or earnings, to a single present amount on a discounted basis. The cost approach is based on the amount that currently would be required to replace the service capacity of an asset (replacement cost). Valuation techniques should be consistently applied. GAAP also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

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

Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s financial instruments as of December 31, 2021 and 2020 consisted primarily of cash and cash equivalents, marketable securities and accounts receivable and accounts payable. As of December 31, 2021 and December 31, 2020, the Company’s financial assets recognized at fair value consisted of the following:

	Fair Value as of December 31, 2021
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents	$	88,637	$	67,209	$	21,428	$	—
Marketable securities:
Commercial paper		68,431		—		68,431		—
Corporate notes		—		—		—		—
U.S. government agency securities and treasuries		10,024		—		10,024		—
Total	$	167,092	$	67,209	$	99,883	$	—

	Fair Value as of December 31, 2020
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents	$	163,264	$	113,505	$	49,759	$	—
Marketable securities:
Commercial paper		158,913		—		158,913		—
Corporate notes		33,433		—		33,433		—
U.S. government agency securities and treasuries		13,045		—		13,045		—
Total	$	368,655	$	113,505	$	255,150	$	—

Cash equivalents and marketable securities have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing third-party pricing services or other market observable data.

The Company measures its cash equivalents at fair value on a recurring basis, which approximates the net asset value per share. The Company classifies some of its cash equivalents within Level 1 of the fair value hierarchy because they are valued using observable inputs that reflect quoted prices for identical assets in active markets. The Company measures its marketable securities at fair value on a recurring basis and classifies those instruments and

F-11

some cash equivalents within Level 2 of the fair value hierarchy. The pricing services used by management utilize industry standard valuation models, including both income and market-based approaches and observable market inputs to determine the fair value of marketable securities and those cash equivalents classified within Level 2 of the fair value hierarchy.

As of December 31, 2021, the fair value of the long-term debt, payable in installments through November 18, 2026, approximated its carrying value due to the proximity of the issuance of the Tranche D Loan date to December 31, 2021 (See Note 13, Long-Term Debt).

Amortization of Debt Discount and Issuance Costs

Long-term debt is initially recorded at its allocated proceeds, net of discounts and deferred costs. Debt discount and issuance costs, consisting of legal and other fees directly related to the debt, are offset against initial carrying value of the debt and are amortized to interest expense over the estimated life of the debt based on the effective interest method.

Liability Related to Sale of Future Royalties

The Company treats the liability related to sale of future royalties as a debt financing, as the Company has significant continuing involvement in the generation of the cash flows, to be amortized to interest expense using the effective interest rate method over the life of the related royalty stream.

The liability related to sale of future royalties and the related interest expense are based on the Company’s current estimates of future royalties expected to be paid over the life of the arrangement. The Company will periodically assess the expected royalty payments using a combination of internal projections and forecasts from external sources. To the extent the Company’s future estimates of royalty payments are greater or less than previous estimates or the estimated timing of such payments is materially different than its previous estimates, the Company will adjust its effective interest rate, which is applied prospectively.

For further discussion of the sale of future royalties, refer to Note 12, Sale of Future Royalties.

Going Concern

At each reporting period, the Company evaluates whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company is required to make certain additional disclosures if it concludes substantial doubt exists about the Company's ability to continue as a going concern within one year after the date that the financial statements are issued and such doubt is not alleviated by the Company’s plans or when its plans alleviate substantial doubt about the Company’s ability to continue as a going concern. The Company’s evaluation entails analyzing prospective operating budgets and forecasts for expectations of the Company’s cash needs, and comparing those needs to its available cash, cash equivalents and marketable securities.

The Company has recurring losses and expects to have recurring losses for the foreseeable future with the continued commercialization of TAZVERIK in ES and FL, the development of tazemetostat in other indications, and the development of the Company’s other product candidates. In addition, the Company has experienced and continues to experience challenges in the continued commercialization of TAZVERIK resulting from the ongoing COVID-19 pandemic, which the Company believes has had an adverse impact on TAZVERIK revenues. In response to the challenges that the Company has continued to face since the Company commenced its launch of TAZVERIK in FL in June 2020, the Company implemented an operational cost reduction plan that was announced on August 9, 2021 and continues to evaluate its costs on an on-going basis with the intent to streamline such costs.

The analysis of the Company’s ability to continue as a going concern for the year ended December 31, 2021 included consideration of the Company’s current cash needs, including its research and development plans, commercialization activities associated with the continued commercialization of TAZVERIK in the ES and FL indications, its existing debt service obligations, and anticipated cost savings resulting from its operational cost reduction plan, including ongoing efforts to eliminate costs not related to the Company’s strategic focus. The analysis included forecasted product revenues from sales of TAZVERIK. Such estimates of future sales contain significant judgment as TAZVERIK was first launched in the first half of 2020 and there is little history with which

F-12

to base such estimates. In addition, the Company’s ongoing efforts to eliminate costs not related to the Company’s strategic focus contains uncertainties as to whether the Company can attain such benefits. Based on the analysis, the Company concluded that its available cash, cash equivalents and marketable securities as of December 31, 2021 combined with the $79.5 million raised in January 2022 (see Note 18 for further information) will be sufficient to fund current planned operations and capital expenditure requirements and pay its debt service obligations as they become due into the third quarter of 2023 which is at least 12 months from the filing date of this Annual Report on Form 10-K with the SEC. As a result, the Company concluded that it did not identify conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date these financial statements were issued. The Company’s current operating plan is based on assumptions that may prove to be wrong, and the Company could use its capital resources sooner than it expects, in which case the Company would evaluate further reductions in its expenses or obtaining additional financing sooner than it otherwise would, which additional financing may not be available or may only be available on terms that are not acceptable to the Company.

Accounts Receivable

The Company extends credit to customers based on its evaluation of the customer’s financial condition. The Company records receivables for all billings when amounts are due under standard terms. Accounts receivable are stated at amounts due net of applicable prompt pay discounts and other contractual adjustments as well as an allowance for doubtful accounts. The Company assesses the need for an allowance for doubtful accounts by considering a number of factors, including the length of time trade accounts receivable are past due, the customer’s ability to pay its obligation and the condition of the general economy and the industry as a whole. The Company will write off accounts receivable when the Company determines that they are uncollectible. In general, the Company has experienced no significant collection issues with its customers.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk include cash, cash equivalents, marketable securities and accounts receivable. The Company attempts to minimize the risks related to cash, cash equivalents and marketable securities by working with highly rated financial institutions that invest in a broad and diverse range of financial instruments as defined by the Company. The Company has established guidelines relative to credit ratings and maturities intended to safeguard principal balances and maintain liquidity. The Company maintains its funds in accordance with its investment policy, which defines allowable investments, specifies credit quality standards and is designed to limit the Company’s credit exposure to any single issuer.

Accounts receivable represent amounts due from customers and collaboration partners. The Company monitors economic conditions to identify facts or circumstances that may indicate that any of its accounts receivable are at risk of collection. For a further discussion of concentration of credit risk see Note 3, Product Revenue, Net.

Property and Equipment

The Company records property and equipment at cost. Property and equipment acquired under a capital lease is recorded at the lesser of the present value of the minimum lease payments under the capital lease or the fair value of the leased property at lease inception. The Company calculates depreciation and amortization using the straight-line method over the following estimated useful lives:

Asset Category	Useful Lives
Laboratory equipment	3 - 6 years
Computer and office equipment, and furniture	3 - 10 years
Leasehold improvements	3 - 6 years or term of respective lease, if shorter

Amortization of capital lease assets is included in depreciation expense. The Company capitalizes expenditures for new property and equipment and improvements to existing facilities and charges the cost of maintenance to expense. The Company eliminates the cost of property retired or otherwise disposed of, along with the corresponding accumulated depreciation, from the related accounts, and the resulting gain or loss is reflected in the results of operations.

F-13

Impairment of Long-Lived Assets

The Company reviews long-lived assets to be held and used, including property and equipment and intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be recoverable.

Evaluation of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset or asset group and its eventual disposition. In the event that such cash flows are not expected to be sufficient to recover the carrying amount of the asset or asset group, the assets are written down to their estimated fair values. No such impairments were recorded during 2021, 2020 or 2019.

Income Taxes

The Company records deferred income taxes to recognize the effect of temporary differences between tax and financial statement reporting. The Company calculates the deferred taxes using enacted tax rates expected to be in place when the temporary differences are realized and records a valuation allowance to reduce deferred tax assets if it is determined that it is more likely than not that all or a portion of the deferred tax asset will not be realized. The Company considers many factors when assessing the likelihood of future realization of deferred tax assets, including recent earnings results, expectations of future taxable income, carryforward periods available and other relevant factors. The Company records changes in the required valuation allowance in the period that the determination is made.

The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available as of the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, the Company records the largest amount of tax benefit with a greater than 50.0% likelihood of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, the Company does not recognize a tax benefit in the financial statements. The Company records interest and penalties related to uncertain tax positions, if applicable, as a component of income tax expense. Refer to Note 8, Income Taxes, for additional information regarding the Company’s income taxes.

Revenue Recognition – Collaboration Revenue

Under ASC 606, Revenue from Contracts with Customers, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company has entered into collaboration and license agreements, which are within the scope of ASC 606, to discover, develop, manufacture and commercialize product candidates. The terms of these agreements typically contain multiple promises or obligations, which may include: (i) licenses, or options to obtain licenses, to compounds directed to specific targets (referred to as “exclusive licenses”) and (ii) research and development activities to be performed on behalf of the collaboration partner related to the licensed targets. Payments to the Company under these agreements may include non-refundable license fees, customer option exercise fees, payments for research activities, reimbursement of certain costs, payments based upon the achievement of certain milestones and royalties on any resulting net product sales.

F-14

The Company first evaluates license and/or collaboration arrangements to determine whether the arrangement (or part of the arrangement) represents a collaborative arrangement pursuant to ASC Topic 808, Collaborative Arrangements, based on the risks and rewards and activities of the parties pursuant to the contractual arrangement. The Company accounts for collaborative arrangements (or elements within the contract that are deemed part of a collaborative arrangement), which represent a collaborative relationship and not a customer relationship, outside the scope of ASC 606. The Company’s collaborations primarily represent revenue arrangements. The Company uses judgment to determine whether milestones or other variable consideration, except for sales-based royalties, should be included in the transaction price as described further below. The transaction price is allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. In determining the stand-alone selling price of a license to the Company’s proprietary technology or a material right provided by a customer option, the Company considers market conditions as well as entity-specific factors, including those factors contemplated in negotiating the agreements as well as internally developed estimates that include assumptions related to the market opportunity, estimated development costs, probability of success and the time needed to commercialize a product candidate pursuant to the license. In validating its estimated stand-alone selling price, the Company evaluates whether changes in the key assumptions used to determine its estimated stand-alone selling price will have a significant effect on the allocation of arrangement consideration between performance obligations.

Amounts received prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Amounts recognized as revenue, but not yet received or invoiced are generally recognized as contract assets.

Exclusive Licenses – If the license to the Company’s intellectual property is determined to be distinct from the other promises or performance obligations identified in the arrangement, which generally include research and development services, the Company recognizes revenue from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. In assessing whether a license is distinct from the other promises, the Company considers relevant facts and circumstances of each arrangement, including the research and development capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the collaboration partner can benefit from the license for its intended purpose without the receipt of the remaining promises, whether the value of the license is dependent on the unsatisfied promises, whether there are other vendors that could provide the remaining promises, and whether it is separately identifiable from the remaining promises. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the research and development and licensing agreement.

F-15

Research and Development Services – The promises under the Company’s collaboration and license agreements generally include research and development services to be performed by the Company on behalf of the collaboration partner. For performance obligations that include research and development services, the Company generally recognizes revenue allocated to such performance obligations based on an appropriate measure of progress. The Company utilizes judgment to determine the appropriate method of measuring progress for purposes of recognizing revenue, which is generally an input measure such as costs incurred. The Company evaluates the measure of progress each reporting period as described under Exclusive Licenses above. Reimbursements from the partner that are the result of a collaborative relationship with the partner, instead of a customer relationship, such as co-development activities, are recorded as a reduction to research and development expense.

Customer Options – The Company’s arrangements may provide a collaborator with the right to select a target for licensing either at the inception of the arrangement or within an initial pre-defined selection period, which may, in certain cases, include the right of the collaborator to extend the selection period. Under these agreements, fees may be due to the Company (i) at the inception of the arrangement as an upfront fee or payment, (ii) upon the exercise of an option to acquire a license or (iii) upon extending the selection period as an extension fee or payment. If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. The Company evaluates the customer options for material rights, or options to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the inception of the arrangement. The Company allocates the transaction price to material rights based on the relative stand-alone selling price, which is determined based on the identified discount and the probability that the customer will exercise the option. Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised or expires.

Milestone Payments – At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. If a milestone or other variable consideration relates specifically to the Company’s efforts to satisfy a single performance obligation or to a specific outcome from satisfying the performance obligation, the Company generally allocates the milestone amount entirely to that performance obligation once it is probable that a significant revenue reversal would not occur.

Royalties – For arrangements that include sales-based royalties, including milestone payments based on a level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements.

For a complete discussion of accounting for collaboration revenues, see Note 11, Collaborations.

Revenue Recognition – Product Revenue

The Company recognizes revenue when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition, the Company performs the following five steps: (i) identify the contract(s) with a

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customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. For a further discussion of accounting for net product revenue see Note 3, Product Revenue, Net.

Revenue Recognition – Other Revenue

Other revenue consists of revenue from the sales of tazemetostat active pharmaceutical ingredient (API) and drug product to the Company’s licensees or collaborators. The Company recognizes revenue on tazemetostat API and drug product when control has transferred under the terms of each agreement.

Cost of Revenues

Cost of revenues primarily consists of costs related to the sales of TAZVERIK and sales of tazemetostat API and drug product to the Company’s licensees or collaborators. These costs include materials, labor, manufacturing overhead, amortization of milestone payments, and royalties payable on net sales of TAZVERIK. Cost of revenues for the year ended December 31, 2021 included approximately $0.8 million related to sales of tazemetostat drug product. There were no cost of revenues for the sales of tazemetostat drug product during the year ended December 31, 2020 and 2019.

Research and Development Expenses

Research and development expenses are expensed as incurred. Research and development expenses are comprised of costs incurred in providing research and development activities, including salaries and benefits, facilities costs, overhead costs, contract research and development services, and other outside costs. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made.

External research and development expenses associated with the Company’s programs include clinical trial site costs, clinical manufacturing costs, costs incurred for consultants and other outside services, such as data management and statistical analysis support, and materials and supplies used in support of the clinical and preclinical programs. Internal costs of the Company’s clinical programs include salaries, stock-based compensation, and the portion of the Company’s facility costs allocated to research and development expense. When vendors billing terms do not coincide with the Company’s period-end, the Company is required to make estimates of its obligations to those vendors, including clinical trial and pharmaceutical development costs, contractual services costs and costs for supply of its product candidates incurred in a given accounting period and record accruals at the end of the period. The Company bases its estimates on its knowledge of the research and development programs, services performed for the period, past history for related activities and the expected duration of the vendor service contract, where applicable.

The Company generally accrues expenses related to research and development activities based on the services received and efforts expended pursuant to contracts with multiple contract research organizations that conduct and manage clinical trials, as well as other vendors that provide research and development services. Payments for these activities are based on the terms of the individual arrangements and may result in payment terms that differ from the pattern of costs incurred. There may be instances in which payments made to vendors will exceed the level of services provided and result in a prepayment of the clinical expense. Payments under some of these contracts depend on factors such as the successful enrollment of subjects and the completion of clinical trial milestones. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from estimates, the Company would adjust the accrual or prepaid accordingly in future periods.

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Stock-Based Compensation

The Company measures employee and non-employee stock-based compensation based on the grant date fair value of the stock-based compensation award. The Company grants stock options at exercise prices equal to the fair value of the Company’s common stock on the date of grant, based on observable market prices.

The Company recognizes employee stock-based compensation expense on a straight-line basis over the requisite service period of the awards. The Company recognizes forfeitures at the time they occur. The actual expense recognized over the vesting period will only represent those options that vest.

For awards with performance conditions in which the award does not vest unless the performance condition is met, the Company recognizes expense if, and to the extent that, the Company estimates that achievement of the performance condition is probable. If the Company concludes that vesting is probable, it recognizes expense from the date it reaches this conclusion through the estimated vesting date. For awards with performance conditions that accelerate vesting of the award, the Company estimates the likelihood of satisfaction of the performance conditions, which affects the period over which the expense is recognized, and recognizes the expense using the accelerated attribution model.

Refer to Note 15, Employee Benefit Plans, for additional information regarding the measurement and recognition of expense related to the Company’s stock-based compensation awards.

Earnings (Loss) per Share

The Company computes basic earnings (loss) per share by dividing income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding. During periods of income, the Company allocates participating securities a proportional share of income determined by dividing total weighted average participating securities by the sum of the total weighted average common shares and participating securities (the “two-class method”). The Company’s restricted stock and Series A Convertible Preferred Stock par value of $0.0001 per share (the “Series A Preferred Stock”) participate in dividends declared by the Company and are therefore considered to be participating securities. Participating securities have the effect of diluting both basic and diluted earnings per share during periods of income. During periods of loss, the Company allocates no loss to participating securities because they have no contractual obligation to share in the losses of the Company. The Company computes diluted earnings (loss) per share after giving consideration to the dilutive effect of stock options and warrants that are outstanding during the period, except where such non-participating securities would be anti-dilutive. Refer to Note 16, Loss per Share, for the Company’s calculation of loss per share for the periods presented.

Segment Information

The Company currently operates as one reportable business segment: the discovery, development, and commercialization of novel epigenetic therapies for patients with cancer.

Inventory

The Company outsources the manufacturing of TAZVERIK and uses contract manufacturers to produce the raw and intermediate materials used in the production of TAZVERIK as well as the finished product. The Company currently has one supplier qualified for each step in the manufacturing process and is in the process of qualifying additional suppliers.

Inventory is composed of raw materials, intermediate materials, which are classified as work-in-process, and finished goods, which are goods that are available for sale. The Company states inventory at the lower of cost or net realizable value with the cost based on the first-in, first-out method. Inventory is classified as long-term when it is expected to be utilized beyond the Company’s normal operating cycle and is included in restricted cash and other assets on the Company's condensed consolidated balance sheets. If the Company identifies excess, obsolete or unsalable items, it writes down its inventory to its net realizable value in the period in which the impairment is identified. These adjustments are recorded based upon various factors related to the product, including the level of product manufactured by the Company, the level of product in the distribution channel, current and projected demand, the expected shelf-life of the product and firm inventory purchase commitments. Shipping and handling

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costs incurred for inventory purchases are included in inventory costs and costs incurred for product shipments are recorded as incurred in cost of revenue.

Prior to receiving its first approval from the U.S. Food and Drug Administration, or FDA, on January 23, 2020 to sell TAZVERIK, the Company expensed all costs incurred related to the manufacture of TAZVERIK as research and development expense because of the inherent risks associated with the development of a product candidate, the uncertainty about the regulatory approval process and the lack of history for the Company of regulatory approval of drug candidates.

Intangible Assets, Net

Intangible assets consist of capitalized milestone payments made to third parties under an in-license of patent rights upon receiving regulatory approval of TAZVERIK. The finite lived intangible assets are being amortized on a straight-line basis over the expected time period the Company will benefit from the in-licensed rights, which is generally the patent life. Intangible assets are recorded at cost at the time of their acquisition and are stated in the Company’s consolidated balance sheets net of accumulated amortization and impairments, if applicable. The amortization expense is recognized as cost of revenue in the Company’s consolidated statement of operations. During 2020 the Company paid a total of $50.0 million in milestone payments under its agreement with Eisai, Co., Ltd., or Eisai, upon regulatory approval of tazemetostat for ES and FL. These regulatory milestones have been capitalized as intangible assets.

The following table presents intangible assets as of December 31, 2021 (in thousands):

	December 31, 2021			December 31, 2020			Estimated useful life (years)
In-licensed rights	$	50,000		$	50,000			12.2
Less: accumulated amortization		(7,151	)		(2,998	)
Total intangible asset, net	$	42,849		$	47,002

The Company recorded approximately $4.2 million and $3.0 million in amortization expense related to intangible assets, using the straight-line methodology, during the years ended December 31, 2021 and 2020, respectively. Estimated future amortization expense for intangible assets is approximately $4.2 million per year thereafter.

The Company assesses its intangible assets for impairment if indicators are present or changes in circumstance suggest that impairment may exist. Events that could result in an impairment, or trigger an interim impairment assessment, include the receipt of additional clinical or nonclinical data regarding one of the Company’s drug candidates or a potentially competitive drug candidate, changes in the clinical development program for a drug candidate, or new information regarding potential sales for the drug. If impairment indicators are present or changes in circumstance suggest that impairment may exist, the Company performs a recoverability test by comparing the sum of the estimated undiscounted cash flows of each intangible asset to its carrying value on the consolidated balance sheet. If the undiscounted cash flows used in the recoverability test are less than the carrying value, the Company would determine the fair value of the intangible asset and recognize an impairment loss if the carrying value of the intangible asset exceeds its fair value.

During the three months ended June 30, 2021, the Company concluded the lower than anticipated current and projected future revenue, due to the impact of the COVID-19 pandemic as well as other factors, was an indicator that impairment may exist related to its finite-lived intangible assets. As a result, the Company performed a recoverability test and determined that the finite-lived intangible assets were recoverable. The Company’s quantitative assessment considered significant assumptions related to estimates of future TAZVERIK sales, offset by direct costs to derive the sales. The estimates of future TAZVERIK sales and associated costs include estimates of significant growth, however, these estimates are uncertain as the product was first launched in the first half of 2020 and due to the uncertainties associated with the ongoing COVID-19 pandemic. Given the limited history of sales and the inherent difficulty in making a long-range forecast, such estimates contain significant uncertainty. If the assumptions regarding forecasted revenue or the costs to derive such revenues prove to be inaccurate, the

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Company may be required to perform future impairment analyses and record an impairment charge for its intangible assets in future periods.

Leases

At inception of a contract, we determine whether an arrangement is or contains a lease. For all leases, we determine the classification as either operating or financing. As of December 31, 2021, the Company does not have any leases that are classified as finance leases.

ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments under the lease. Lease recognition occurs at the commencement date, and lease liability amounts are based on the present value of lease payments made during the lease term. Renewals are not assumed in the determination of the lease term unless they are deemed to be reasonably assured at the inception of the lease. Because our leases do not provide information to determine an implicit interest rate, we use our incremental borrowing rate in determining the present value of lease payments. ROU assets also include any lease payments made prior to the commencement date less lease incentives received. Operating lease expense is recognized on a straight-line basis over the lease term.

The Company has elected not to apply the recognition requirements to short-term leases with a term of 12 months or less. Instead, the Company recognizes the lease payments in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term.

Recently Adopted Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that we adopt as of the specified effective date. Unless otherwise discussed below, we do not believe that the adoption of recently issued standards have or may have a material impact on our consolidated financial statements or disclosures.

Revenue Recognition – Collaboration Revenue

In November 2018, the FASB, issued ASU 2018-18, Collaborative Arrangements, or ASC 808, which clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue when the collaborative arrangement participant is a customer in the context of a unit of account and precludes recognizing as revenue consideration received from a collaborative arrangement participant if the participant is not a customer. The new standard was effective in the first quarter of fiscal 2021. The Company adopted ASC 808 effective in the first quarter of fiscal 2021 and the Company’s adoption of this standard did not have a material effect on the Company’s financial statements.

Income Taxes

In December 2019, the Financial Accounting Standards Board, or the FASB, issued ASU 2019-12, Income Taxes, or ASC 740, which simplifies the accounting for income taxes. The new standard was effective in the first quarter of fiscal 2021. The Company adopted ASC 740 effective in the first quarter of fiscal 2021 and the Company’s adoption of this standard did not have a material effect on the Company’s financial statements. 

3. Product Revenue, Net

The Company sells TAZVERIK in the United States principally to a limited number of specialty pharmacies, which dispense the product directly to patients, and specialty distributors, which in turn sell the product to hospital pharmacies and community practice pharmacies (collectively, healthcare providers) for the treatment of patients. The specialty pharmacies and specialty distributors are referred to as the Company’s customers.

Product revenue is recognized by the Company in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services when the customer obtains control of the product, which occurs at a point in time, typically when the product is received by the Company’s customers. The Company provides a right of return to its customers for unopened product for a limited time before and after its expiration

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date, which right of return lapses upon shipment to a patient. Healthcare providers to whom specialty distributors sell TAZVERIK hold limited inventory that is designated for patients, and the Company monitors inventory levels in the distribution channel, to limit the risk of return.

Reserves for Variable Consideration

Revenues from product sales are recorded as product revenue at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and which result from discounts, returns, chargebacks, rebates, co-pay assistance and other allowances that are offered within contracts between the Company and its customers, health care providers, payors and other indirect customers relating to the Company’s product sales. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than a customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as the Company’s historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which the Company is entitled based on the terms of the contract(s). The amount of variable consideration that is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known.

Trade Discounts and Allowances: The Company generally provides customers with discounts that include incentive fees that are explicitly stated in customer contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, the Company receives sales order management, data and distribution services from certain customers. To the extent the services received are distinct from the Company’s sale of products to the customer, these payments are classified in selling, general and administrative expenses in the consolidated statements of operations and comprehensive loss.

Product Returns: Consistent with industry practice, the Company generally offers customers a limited right of return based on the product’s expiration date for product that has been purchased from the Company, which lapses upon shipment to a patient. The Company estimates the amount of product sales that may be returned by customers and records this estimate as a reduction of revenue in the period in which the related product revenue is recognized. The Company currently estimates product return liabilities using available industry data and the Company’s own historical sales information, including its visibility into the product remaining in the distribution channel.

Provider Chargebacks and Discounts: Chargebacks for fees and discounts to healthcare providers represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to customers who directly purchase the product from the Company. Customers charge the Company for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. These reserves are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue and accounts receivable. Chargeback amounts are generally determined at the time of resale to the qualified healthcare provider by customers, and the Company generally issues credits for such amounts within a few weeks of the customer’s notification to the Company of the resale. Reserves for chargebacks consist of credits that the Company expects to issue for units that remain in the distribution channel at each reporting period end that the Company expects will be sold to qualified healthcare providers, and chargebacks that customers have claimed but for which the Company has not yet issued a credit.

Government Rebates: The Company is subject to discount obligations under state Medicaid programs and Medicare. The Company estimates its Medicaid and Medicare rebates based upon a range of possible outcomes that are probability-weighted for the estimated payor mix. These reserves are recorded in the same period in which the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability that is included in accrued expenses on the Company’s consolidated balance sheets. For Medicare, the Company also estimates the number of patients in the prescription drug coverage gap for whom the Company will owe an

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additional liability under the Medicare Part D program. The Company’s liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter, and estimated future claims that will be made for product that has been recognized as revenue, but remains in the distribution channel inventories at period end.

Payor Rebates: The Company may contract with various private payor organizations, primarily insurance companies and pharmacy benefit managers, for the payment of rebates with respect to utilization of the Company’s products. The Company estimates these rebates and records such estimates in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability.

Other Incentives/Patient Assistance Programs: The Company also offers voluntary patient assistance programs such as co-pay assistance. Co-pay assistance programs are intended to provide financial assistance to qualified commercially insured patients with prescription drug co-payments required by payors. The calculation of the accrual for co-pay assistance is based on an estimate of claims and the cost per claim that the Company expects to receive associated with product that has been recognized as revenue, but remains in the distribution channel inventories at period end.

The following table summarizes activity in each of the above product revenue allowances and reserve categories for the year ended December 31, 2021:

	Chargebacks, Discounts, and			Government and Other
	Fees			Rebates			Returns			Total
	(In thousands)
Balance, January 1, 2021	$	133		$	428		$	67		$	628
Provision		1,886			3,093			274			5,253
Payments or credits		(1,775	)		(2,935	)		(232	)		(4,942	)
Balance, December 31, 2021	$	244		$	586		$	109		$	939

The following table summarizes activity in each of the above product revenue allowances and reserve categories for the year ended December 31, 2020:

	Chargebacks, Discounts, and			Government and Other
	Fees			Rebates			Returns		Total
	(In thousands)
Balance, January 1, 2020	$	—		$	—		$	—	$	—
Provision		802			1,046			67		1,915
Payments or credits		(669	)		(618	)		—		(1,287	)
Balance, December 31, 2020	$	133		$	428		$	67	$	628

Concentration of Credit Risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist of accounts receivable from customers and cash held at financial institutions. The Company believes that such customers and financial institutions are of high credit quality.

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For the years ended December 31, 2021 and 2020 , net product revenue was primarily generated from five individual customers. Revenue earned from each customer as a percentage of net product revenue is as follows:

	Year Ended December 31,
	2021			2020
Customer 1		30	%		45	%
Customer 2		11	%		11	%
Customer 3		27	%		20	%
Customer 4		21	%		24	%
Customer 5		11	%		0	%

As of December 31, 2021 and 2020, five individual customers represented as a percentage of accounts receivable as follows:

	December 31, 2021			December 31, 2020
Customer 1		15	%		21	%
Customer 2		10	%		14	%
Customer 3		22	%		29	%
Customer 4		29	%		36	%
Customer 5		24	%		0	%

No other customer represented more than 10 percent of net product revenue or accounts receivable.

4. Property and Equipment, net

Property and equipment, net consists of the following:

	December 31,
	2021			2020
	(In thousands)
Laboratory equipment	$	4,580		$	4,435
Computer and office equipment, and furniture		4,386			4,636
Leasehold improvements	453			453
Construction in progress		157			34
Property and equipment		9,576			9,558
Less: accumulated depreciation		(8,031	)		(7,406	)
Property and equipment, net	$	1,545		$	2,152

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Depreciation expense was $1.1 million, $1.0 million and $0.8 million for the years ended December 31, 2021, 2020, and 2019, respectively.

5. Inventory

All of the Company’s inventory relates to the manufacturing of TAZVERIK. The following table sets forth the Company’s inventory as of December 31, 2021 and December 31, 2020:

	December 31, 2021		December 31, 2020
	(In thousands)
Raw materials	$	3,227	$	1,068
Work in process		13,748		8,564
Finished goods		1,710		829
Total	$	18,685	$	10,461
Balance sheet classification
Inventory	$	3,216	$	10,461
Restricted cash and other assets		15,469		—
Total	$	18,685	$	10,461

As of December 31, 2021, the Company has not capitalized inventory costs related to its other drug development programs.

The Company’s active pharmaceutical ingredient has a long shelf life and the Company’s finished drug product has a three-year expiry, however the realizability of the inventory is subject to forecasted future sales of TAZVERIK. The Company’s forecasted sales currently support the realizability of the Company’s inventory but are uncertain and could change in the future, which would require the Company to write down the value of such inventory. Due to the revisions to the Company’s forecast of future TAZVERIK sales during the quarter ended June 30, 2021, the Company classified a portion of its inventory as long-term.

6. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following:

	December 31,
	2021		2020
	(In thousands)
Prepaid clinical and manufacturing costs	$	12,756	$	12,646
Interest receivable on available for sale securities	72		369
Other prepaid expenses and other receivables		6,637		4,906
Total prepaid expenses and other current assets	$	19,465	$	17,921

7. Accrued Expenses

Accrued expenses consisted of the following:

	December 31,
	2021		2020
	(In thousands)
Employee compensation and benefits	$	11,737	$	11,921
Research and development expenses		13,744		10,664
Current portion of liability related to the sale of future royalties		273		—
Professional services and other		5,023		5,987
Accrued expenses	$	30,777	$	28,572

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8. Income Taxes

The Company’s losses before income taxes consist solely of domestic losses.

The provision for (benefit from) income taxes for the years ended December 31, 2021, 2020, and 2019 is as follows:

	2021		2020		2019
	(In thousands)
Current	$	22	$	22	$	(34	)
Deferred		—		92		92
Total		22		114		58
Income tax provision	$	22	$	114	$	58

A reconciliation of the federal statutory income tax rate and the Company’s effective income tax rate is as follows:

	Year Ended December 31,
	2021			2020			2019
Federal statutory income tax rate		21.0	%		21.0	%		21.0	%
State income taxes		5.5			6.1			6.0
Research and development and other tax credits		2.6			2.0			1.9
Permanent items		0.1			(0.6	)		(0.7	)
Change in valuation allowance		(27.2	)		(27.9	)		(27.5	)
Other		(2.1	)		(0.6	)		(0.7	)
Effective income tax rate		0.0	%		0.0	%		0.0	%

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Deferred Tax Assets (Liabilities)

The Company’s deferred tax assets (liabilities) included in other assets in the consolidated balance sheets consist of the following:

	December 31,
	2021			2020
	(In thousands)
Deferred tax assets:
Net operating loss carryforwards	$	294,248		$	238,792
Research and development and other credit carryforwards		41,189			34,205
Accruals and allowances		3,071			2,949
Eisai license payment		10,752			11,935
Stock compensation		8,211			7,338
Other		1,072			1,220
Sale of royalty		4,210			3,857
Lease liability		5,987			5,462
Business interest		7,060			1,220
Gross deferred tax assets		375,800			306,978
Deferred tax asset valuation allowance		(370,500	)		(302,137	)
Total deferred tax assets		5,300			4,841
Deferred tax liabilities:
Depreciation and other		—			(18	)
Right of use asset		(5,300	)		(4,709	)
Total deferred tax liabilities		(5,300	)		(4,727	)
Net deferred tax asset	$	—		$	114

The Company evaluated the expected recoverability of its net deferred tax assets as of December 31, 2021 and 2020, and determined that there was insufficient positive evidence to support the recoverability of these net deferred tax assets, concluding it is more likely than not that its net deferred tax assets would not be realized in the future; therefore, the Company provided a full valuation allowance against its net deferred tax asset balance as of December 31, 2021 and 2020.

As of December 31, 2021, the Company had operating loss carryforwards of approximately $1.1 billion and $1.1 billion available to offset future taxable income for United States federal and state income tax purposes, respectively. The U.S. federal tax operating loss carryforwards of $428.5 million will expire at various dates from 2029 through 2037. Approximately $664.9 million of the U.S. federal tax operating losses can be carried forward indefinitely. The state tax operating loss carryforwards expire commencing in 2030.

Additionally, as of December 31, 2021, the Company had research and development tax credit carryforwards of approximately $15.6 million and $6.1 million available to be used as a reduction of federal income taxes and state income taxes, respectively, which expire at various dates from 2028 through 2040, as well as federal orphan drug tax credit carryforwards of $20.8 million, which would expire at various dates from 2033 through 2041. The Company’s ability to use its operating loss carryforwards and tax credits to offset future taxable income is subject to restrictions under Section 382 of the U.S. Internal Revenue Code (the “Internal Revenue Code”). These restrictions may limit the future use of the operating loss carryforwards and tax credits if certain ownership changes described in the Internal Revenue Code occur. Future changes in stock ownership may occur that would create further limitations on

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the Company’s use of the operating loss carryforwards and tax credits. In such a situation, the Company may be required to pay income taxes, even though significant operating loss carryforwards and tax credits exist.

Uncertain Tax Positions

The following is a rollforward of the Company’s unrecognized tax benefits:

	December 31,
	2021		2020		2019
	(In thousands)
Unrecognized tax benefits - as of beginning of year	$	7,160	$	6,328	$	5,743
Gross increases - current period tax positions		1,206		832		585
Unrecognized tax benefits - as of end of year	$	8,366	$	7,160	$	6,328

None of the Company’s unrecognized tax benefits would result in income tax expense or impact the Company’s effective tax rate if recognized. The Company had no accrued tax-related interest or penalties as of December 31, 2021 or 2020.

The Company has generated research and development and orphan drug credits, but has not conducted a study to document the qualified activities. This study may result in an adjustment to the Company’s reserve for uncertain tax positions, research and development credit, and orphan drug credit carryforwards.

The Company files income tax returns in the U.S. federal tax jurisdiction and various state tax jurisdictions. Since the Company is in a loss carryforward position, the Company is generally subject to examination by the U.S. federal, state and local income tax authorities for all tax years in which a loss carryforward is available.

9. Commitments and Contingencies

Commitments

In addition to commitments under leasing arrangements (Refer to Note 10, Leases), the Company committed to $10.4 million of development costs payable to Roche Molecular upon certain development and regulatory milestones, under the amended companion diagnostic agreement, and Eisai agreed to reimburse the Company $0.9 million of this amount related to a regulatory milestone for Japan, which Eisai paid to us in the fourth quarter of 2020. In July 2019, the Company entered into a fourth amendment to the companion diagnostics agreement. Under the amended agreement, the Company and Roche Molecular agreed to divide a $1.0 million regulatory milestone for the United States into two separate milestone payments, of which $0.5 million was paid by the Company as part of the signed amendment, and the remaining $0.5 million was paid by the Company in December 2019 upon the satisfaction of certain conditions set forth in the fourth amendment to the companion diagnostics agreement. As part of this fourth amendment, Roche Molecular also assigned all of its rights and obligations under the companion diagnostics agreement to Roche Sequencing due to a reorganization at Roche group, and this assignment became effective as of January 1, 2020. Through December 31, 2021, the Company has paid Roche Sequencing $9.4 million under the amended agreement, including developmental costs of $3.4 million paid in 2020, $4.0 million paid in 2019 and $2.0 million paid in 2018, respectively, upon the achievement of milestones under the amended agreement with Roche Sequencing. As of December 31, 2021, the Company is responsible for the remaining development costs of $1.0 million due under the agreement. In addition, the Company paid $1.0 million to Roche Sequencing for the achievement of a development milestone in the fourth quarter of 2020.

Additionally, the Company enters into contracts in the normal course of business with clinical research organizations for clinical and preclinical research studies, external manufacturers for product for use in clinical trials, and other research supplies and other services as part of the Company’s operations. These contracts generally

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provide for termination on notice, and therefore are cancelable contracts and not included in contractual commitments.

10. Leases

The Company enters into lease arrangements for its facilities as well as certain equipment. A summary of the arrangements are as follows:

Operating Leases

The Company leases office and laboratory space at Technology Square in Cambridge, Massachusetts under a Lease Agreement, dated as of June 15, 2012, as amended, or the Technology Square Lease, with ARE-TECH Square, LLC, a Delaware limited liability company.

In May 2017, the Company exercised its option to extend the term of the Technology Square Lease to November 30, 2022. Under the Technology Square Lease as amended, the Company agreed to pay a monthly base rent of approximately $0.2 million for the period commencing December 1, 2017 through May 31, 2018, with an increase on June 1, 2018 of approximately $33,000 and annual increases of approximately $9,000 on December 1 of each subsequent year until the last increase, which will occur on December 1, 2021.

On August 11, 2021, the Company, entered into a fifth amendment to the Technology Square Lease (the “Fifth Amendment”) with ARE-TECH Square, LLC. Under the Fifth Amendment, the Company extended the term of the Technology Square Lease through November 30, 2024. Under the Fifth Amendment, the Company will continue to pay the Landlord the current monthly base rent amount contemplated by the Technology Square Lease through November 30, 2022, with an increase commencing on December 1, 2022 and adjusting the monthly base rent amount to approximately $377,000 and an increase commencing on December 1, 2023 and adjusting the monthly base rent amount to approximately $388,000 through November 30, 2024. In addition, under the Fifth Amendment, the Landlord agreed to provide the Company with a tenant improvement allowance of up to approximately $430,000 if requested by the Company by August 11, 2022, subject to specified terms and conditions. In accordance with ASU 2016-02, Leases, or ASC 842, the Company accounted for the Fifth Amendment as a lease modification and remeasured the operating lease liability, resulting in an additional $7.0 million operating lease liability and right of use asset. Under the current terms of the Technology Square Lease, the Company does not have any further right to extend the term beyond November 30, 2024.

The Company has a $0.5 million letter of credit as a security deposit for the Technology Square Lease and has recorded cash held to secure this letter of credit as restricted cash and other assets on the consolidated balance sheet.

On August 16, 2019, the Company entered into a lease, or the Hampshire Street Lease, with BMR-Hampshire LLC, or BMR. The Hampshire Street Lease is for 33,525 rentable square feet of office space in Cambridge, Massachusetts. The Hampshire Street Lease commenced as of December 1, 2019. The Hampshire Street Lease has an initial term of seven years and four months from the commencement date and provides the Company with an option to extend the lease term for one additional five-year period. After a four-month period during which base rent was not payable, the Hampshire Street Lease provides for monthly rent payments starting at approximately $0.2 million and increasing 2.5% per year. In the event that the Company exercises its option to extend the lease term, the Hampshire Street Lease provides for monthly rent payments during the additional five-year period at the greater of the base rent rate at the end of the initial term or the then-current market rent.

The Company has a $1.0 million letter of credit in favor of BMR as a security deposit for the Hampshire Street Lease and has recorded cash held to secure this letter of credit as restricted cash and other assets on the consolidated balance sheet. In applying ASC 842, the Company determined the classification of the Hampshire Street Lease to be operating and recorded a lease liability and a right-of-use asset as of December 31, 2019.

The Company is required to pay certain variable costs to its landlords in addition to fixed rent. These costs include common area maintenance, real estate taxes, and parking and are included in lease expense.

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The following table contains a summary of the lease costs recognized under ASC 842 and other information pertaining to the Company’s operating leases for the years ended December 31, 2021, 2020 and 2019:

	Twelve months ended December 31,			Twelve months ended December 31,			Twelve months ended December 31,
	2021			2020			2019
Lease cost
Operating lease cost	$	6,291		$	6,155		$	3,771
Variable lease cost		2,039			1,764			1,318
Total lease cost	$	8,330		$	7,919		$	5,089
Other information
Operating cash flows used for operating leases	$	6,436		$	4,374		$	3,648
Weighted average remaining lease term	4.2 years			5.3 years			5.3 years
Weighted average discount rate		9.74	%		9.77	%		9.60	%

Future minimum lease payments under the Company’s non-cancelable operating leases as of December 31, 2021, are as follows:

	2021
	(In thousands)
2022	$	6,202
2023		7,517
2024		7,322
2025		3,057
Thereafter		3,909
Total lease payments	$	28,007
Less: imputed interest		(5,356	)
Total operating lease liabilities at December 31, 2021	$	22,651

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11. Collaborations

HutchMed

On August 7, 2021, the Company entered into a strategic collaboration pursuant to a license agreement (the “HutchMed License Agreement”) with Hutchison China MediTech Investment Limited (“HutchMed”) for the development, manufacture and commercialization of tazemetostat, either as a monotherapy or as a part of combinations with other therapies, including HutchMed proprietary compounds, agreed by the parties under the HutchMed License Agreement (“Licensed Products”) for the treatment of epithelioid sarcoma, follicular lymphoma, diffuse large B-cell lymphoma in humans, and any additional indications agreed by the parties in accordance with the terms of the HutchMed License Agreement (the “Field”) in mainland China, Taiwan, Hong Kong and Macau (each, a “Jurisdiction”, and collectively, the “Territory”).

Agreement Structure

The Company has granted HutchMed licenses under patent rights and know-how controlled by the Company to enable HutchMed to develop and commercialize Licensed Products in the Field in the Territory. The licenses granted to HutchMed are co-exclusive with the Company with respect to the development of Licensed Products in the Field in the Territory and exclusive with respect to the commercialization of Licensed Products in the Field in the Territory. The Company also granted HutchMed a license under patent rights and know-how controlled by the Company to enable HutchMed to manufacture tazemetostat drug substance and drug product for the purpose of developing and commercializing Licensed Products in the Field in the Territory. The Company retains development and commercialization rights with respect to Licensed Products in the rest of the world outside of the Territory except for Japan.

The Company has agreed to conduct a technology transfer of manufacturing technology to HutchMed to enable HutchMed to manufacture clinical and commercial quantities of tazemetostat drug substance and drug product to carry out its obligations and exercise its rights under the HutchMed License Agreement. Subject to the execution of a clinical supply agreement or commercial supply agreement, as applicable, and until the completion of the technology transfer to HutchMed, the Company has agreed to manufacture and supply HutchMed with tazemetostat drug substance and drug product in sufficient quantities for HutchMed’s development or commercialization activities for Licensed Products in the Field in the Territory.

HutchMed has agreed to use commercially reasonable efforts to carry out development activities in the Territory as agreed by the parties and to seek to obtain and maintain regulatory approval of the Licensed Products in the Territory. HutchMed agreed to use commercially reasonable efforts to commercialize Licensed Products in the Field in the Territory. HutchMed is responsible for all costs it incurs in developing, obtaining regulatory approval of, and commercializing Licensed Products in the Field in the Territory, including costs incurred by HutchMed in conducting clinical trials that only include clinical sites in the Territory. For global studies conducted by the Company that HutchMed elects to participate in by conducting any such study in the Territory, HutchMed will be responsible for enrolling and treating in the Territory 20% of the total number of study patients of such global study and will be responsible for costs for those patients enrolled and treated in such trials. HutchMed will also be responsible for 20% of the costs of such global studies that are not specific to any territory and the Company will be responsible for all other costs of such global studies. HutchMed has agreed to participate in the Company’s EZH-301 and SYMPHONY-1 (EZH-302) global studies, however under certain circumstances where the SYMPHONY-1 (EZH-302) global study is not considered a confirmatory trial for regulatory approval in China, the Company shall be responsible for the costs of the trial in the Territory.

Pursuant to the HutchMed License Agreement, the Company received a nonrefundable upfront payment of $25.0 million in September 2021. The Company is also entitled to milestone payments of up to $110.0 million in the aggregate for achievement of specified development and regulatory milestones with respect to Licensed Products in the Territory, and up to $175.0 million in the aggregate for achievement of specified sales milestones in the Territory with respect to the Licensed Products. The Company will also be entitled to receive tiered royalties, ranging from a mid-teens percentage to a low twenties percentage based on HutchMed’s cumulative annual net sales, if any, of Licensed Products in the Territory.

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Under the HutchMed License Agreement, the Company issued a warrant to HutchMed (the “HutchMed Warrant”) , exercisable at any time prior to August 7, 2025 for up to 5,653,000 shares of the Company’s common stock at an exercise price of $11.50 per share.

Unless earlier terminated, the HutchMed License Agreement will expire upon the expiration of the last royalty term for the last Licensed Product in the Field in the Territory. HutchMed may terminate the HutchMed License Agreement in its entirety for any or no reason upon 12 months’ prior written notice to the Company. Either party may, subject to specified cure periods, terminate the HutchMed License Agreement in the event of the other party’s uncured material breach, and under specified circumstances relating to the other party’s insolvency or if the other party or its affiliates challenges the validity, patentability, or enforceability of patent rights that are owned by or licensed to such party or its affiliates and that are subject to the licenses granted in the HutchMed License Agreement.

License Revenue

The Company evaluated the terms of the HutchMed License Agreement and first determined that the HutchMed Warrant should be accounted for pursuant to ASC 815, Derivatives and Hedging, with the HutchMed Warrant's fair value of approximately $13.0 million (Note 14) at execution considered outside of the revenue arrangement.

The Company identified the following performance obligations at the inception of the HutchMed License Agreement: (1) exclusive license with rights to develop, manufacture and commercialize tazemetostat in the Territory, (2) research and development services related to global trials, and (3) a material right related to the Company’s obligation to provide clinical supply of tazemetostat. In addition, the Company may also provide certain technology transfer services related to providing HutchMed with the capability to manufacture tazemetostat, for which the Company will receive reimbursement that approximates stand-alone selling price.

The Company evaluated the HutchMed License Agreement under ASC 606, Revenue from Contracts with Customers. Based on that evaluation, the $12.0 million of the up-front fee remaining after allocation to the HutchMed Warrant and the reimbursement to be received for its research and development services constituted the amount of the consideration to be included in the transaction price. In addition, should the global SYMPHONY-1 (EZH-302) trial not be deemed a confirmatory trial for purposes of regulatory approval in China, the Company shall be responsible for reimbursing HutchMed for the costs of the portion of the global SYMPHONY-1 (EZH-302) trial that will be performed in China. The Company concluded that this repayment provision represented variable consideration under the arrangement. Due to the uncertainty of potential repayment, which is based solely on the decision of a regulatory authority, the Company could not assert that it was probable that a significant reversal of revenue would not occur. As a result, the Company determined that the transaction price should be fully constrained. The Company will evaluate the application of the constraint on a quarterly basis and should the contingency be resolved without future payment to HutchMed for the global SYMPHONY-1 (EZH-302) trial, the full upfront fee and any reimbursement of research and development services will be included in the transaction price. In addition, should the estimated payment to HutchMed for the global SYMPHONY-1 (EZH-302) trial be determined to be less than the cumulative up-front fee and research and development reimbursement payments, such excess will be included in the transaction price.

None of the development or regulatory milestones have been included in the transaction price, as all such milestone amounts were fully constrained. As part of the Company's evaluation of the constraint, the Company considered numerous factors, including that receipt of the milestones is outside the control of the Company and contingent upon success in future clinical trials and the licensee’s efforts. Any consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as these amounts have been determined to relate predominantly to the license granted to HutchMed and therefore are recognized at the later of when the performance obligation is satisfied or the related sales occur.

The Company delivered the license during the third quarter of 2021 and expects that based on the estimated standalone selling price of the license, that the majority of the consideration in the arrangement will be allocated to the license performance obligation, once such consideration is no longer constrained. As the Company performs research and development services, it will recognize revenue as such services are performed, upon the transaction price no longer being fully constrained.

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GSK

In January 2011, the Company entered into a collaboration and license agreement with Glaxo Group Limited (an affiliate of GlaxoSmithKline plc), or GSK, to discover, develop and commercialize novel small molecule HMT inhibitors directed to available targets from the Company’s platform. Under the terms of the agreement, the Company granted GSK exclusive worldwide license rights to HMT inhibitors directed to three targets. In March 2014, the Company and GSK amended certain terms of this agreement for the third licensed target, revising the license terms with respect to candidate compounds and amending the corresponding financial terms, including reallocating milestone payments and increasing royalty rates as to the third target. Subsequent to a GSK strategic portfolio prioritization, the Company received notice in October 2017 that GSK terminated the agreement with respect to the third target, effective December 31, 2017, which returned all rights to that target to the Company. On December 16, 2021, the Company received written notice from GSK that GSK elected to terminate the Collaboration and License Agreement without cause, and in accordance with the terms of the agreement and the notice of termination, the termination will be effective on March 16, 2022 . As a result of the termination of the agreement, as of the termination effective date, the license rights granted by the Company to GSK will terminate, GSK will cease to accrue any financial obligations to the Company and the Company will be entitled to pursue the PRMT5 and PRMT1 targets in all fields worldwide without further obligation to GSK. The Company substantially completed all of its obligations under this agreement by the end of 2015. The termination of the agreement had no impact on the Company’s financial statements.

Eisai

In April 2011, the Company entered into a collaboration and license agreement with Eisai, under which the Company granted Eisai an exclusive worldwide license to its small molecule HMT inhibitors directed to the EZH2 HMT, including the Company’s product candidate tazemetostat, while retaining an opt-in right to co-develop, co-commercialize and share profits with Eisai as to licensed products in the United States.

As of December 31, 2014, the Company had completed its performance obligations under the original agreement.

In March 2015, the Company entered into an amended and restated collaboration and license agreement with Eisai (the “Eisai License Agreement”), under which the Company reacquired worldwide rights, excluding Japan, to its EZH2 program, including tazemetostat. Under the Eisai License Agreement, the Company is responsible for global development, manufacturing and commercialization outside of Japan of tazemetostat and any other EZH2 product candidates, with Eisai retaining development and commercialization rights in Japan, as well as a right to elect to manufacture tazemetostat and any other EZH2 product candidates in Japan, and a right of first negotiation for the rest of Asia. Eisai waived its right of first negotiation for the rest of Asia in 2018.

Under the original collaboration and license agreement, Eisai was solely responsible for funding all research, development and commercialization costs for EZH2 compounds. Under the Eisai License Agreement, the Company is solely responsible for funding global development, manufacturing and commercialization costs for EZH2 compounds outside of Japan, including the remaining development costs due under a companion diagnostics agreement with Roche Molecular Systems, Inc., or Roche Molecular, which was amended to assign all of Roche Molecular’s rights and obligations under the companion diagnostics agreement to Roche Sequencing, effective January 1, 2020. Eisai is solely responsible for funding Japan-specific development and commercialization costs for EZH2 compounds.

The Company recorded the reacquisition of worldwide rights, excluding Japan, to the EZH2 program, including tazemetostat, under the Eisai License Agreement, as an acquisition of an in-process research and development asset. As this asset was acquired without corresponding processes or activities that would constitute a business, had not achieved regulatory approval for marketing and, absent obtaining such approval, had no alternative future use, the Company recorded the $40.0 million upfront payment made to Eisai in March 2015 as research and development expense in the consolidated statements of operations and comprehensive loss. The Company also agreed to pay Eisai up to $70.0 million in clinical development and regulatory milestones, all of which have been paid, and royalties at a percentage in the mid-teens on worldwide net sales of any EZH2 product, excluding net sales in Japan. The Company is eligible to receive from Eisai royalties at a percentage in the mid-teens on net sales of any EZH2 product in Japan.

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During the years ended December 31, 2020 and 2019, Eisai purchased drug product from the Company at cost to facilitate development within Japan under the Eisai License Agreement and the Company recognized approximately $5.3 million and $3.8 million, respectively, as a reduction to research and development expense.

During the years ended December 31, 2021 and 2020, the Company recorded $4.6 million and $1.7 million, respectively related to worldwide royalties due under the Eisai License Agreement in cost of product revenue based on U.S. sales of TAZVERIK and as of December 31, 2021 and 2020, $1.7 million and $0.7 million, respectively in royalties were payable under the Eisai License Agreement.

As of December 31, 2021, and 2020, the Company had accounts receivable of less than $0.1 million, respectively, due from Eisai. For additional information regarding certain of the Eisai royalties, see Note 12, Sale of Future Royalties.

In March 2021, the Company and Eisai entered into a supply agreement providing for the manufacture and supply to Eisai of tazemetostat drug product. Under the terms of the supply agreement, the Company also agreed to waive its right of exclusive supply of tazemetostat drug substance from the Company’s drug substance manufacturer. During the year ended December 31, 2021, the Company recognized $6.3 million related to the Company’s waiver of its exclusive right to supply of tazemetostat drug substance from the Company’s drug substance manufacturer and delivery of tazemetostat drug product in collaboration and other revenue.

Roche

In December 2012, Eisai and the Company entered into a companion diagnostics agreement with Roche Molecular, under which Eisai and the Company engaged Roche Molecular to develop a companion diagnostic to identify patients who possess certain activating mutations of EZH2. In October 2013, this agreement was amended to include additional mutations in EZH2. The development costs due under the amended agreement with Roche Molecular were the responsibility of Eisai until the execution of the amended and restated collaboration and license agreement with Eisai in March 2015, at which time the Company assumed responsibility for the remaining development costs due under the agreement. In December 2015, the Company and Eisai entered into a second amendment to the companion diagnostics agreement with Roche Molecular. The agreement was further amended in March 2018. Under the amended agreement, the Company was responsible for remaining development costs of $10.4 million due under the agreement as of March 2018 and Eisai agreed to reimburse the Company $0.9 million of this amount related to a regulatory milestone for Japan. In July 2019, the Company entered into a fourth amendment to the companion diagnostics agreement. Under the amended agreement, the Company and Roche Molecular agreed to divide a $1.0 million regulatory milestone for the United States into two separate milestone payments, of which $0.5 million was paid by the Company as part of the signed amendment, and the remaining $0.5 million was paid by the Company in December 2019 upon the satisfaction of certain conditions set forth in the fourth amendment to the companion diagnostics agreement. As part of this fourth amendment, Roche Molecular also assigned all of its rights and obligations under the companion diagnostics agreement to Roche Sequencing due to a reorganization at Roche group, and this assignment became effective as of January 1, 2020. As of December 31, 2021, the Company is responsible for the remaining development costs of $1.0 million due under the agreement. The $0.9 million that Eisai agreed to reimburse the Company related to a regulatory milestone for Japan was achieved as of June 30, 2020 and payment received in the fourth quarter of 2020. In addition, the Company paid $1.0 million for the achievement of a development milestone in the fourth quarter of 2020.

Under the agreement with Roche Sequencing, Roche Sequencing is obligated to use commercially reasonable efforts to develop and to make commercially available the companion diagnostic. Roche Sequencing has exclusive rights to commercialize the companion diagnostic. On June 18, 2020 the FDA approved the companion diagnostic that is intended to identify follicular lymphoma patients with an EZH2 mutation for treatment with tazemetostat.

The agreement with Roche Sequencing will expire when the Company and Eisai are no longer developing or commercializing tazemetostat. The Company and Eisai may terminate the agreement by giving Roche Sequencing 90 days’ written notice if the Company and Eisai discontinue development and commercialization of tazemetostat or determine, in conjunction with Roche Sequencing, that the companion diagnostic is not needed for use with tazemetostat. Any party may also terminate the agreement in the event of a material breach by any party, in the event of material changes in circumstances that are contrary to key assumptions specified in the agreement or in the

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event of specified bankruptcy or similar circumstances. Under specified termination circumstances, Roche Sequencing may become entitled to specified termination fees.

Boehringer Ingelheim

In November 2018, the Company entered into a collaboration and license agreement with Boehringer Ingelheim International GmbH (“Boehringer Ingelheim”) to discover, research, develop and commercialize small molecule compounds that are inhibitors of an undisclosed histone acetyltransferase, or HAT, target and an undisclosed helicase target, along with associated predictive biomarkers (the “Target Projects”). Under the terms of the agreement, the Company granted to Boehringer Ingelheim an exclusive, worldwide license to the undisclosed target inhibitors technology. The agreement also included reciprocal licenses to utilize each other’s know-how, patents and technologies for activities under the agreement. Further, each party was granted the license to develop, manufacture, commercialize and otherwise exploit any compound or product that successfully achieves start of lead optimization (“SoLO”). The Company was also obligated to provide R&D services through SoLO approval for both Target Projects, and to serve on the Joint Steering Committee (“JSC”) throughout the term of the contract. The parties were to jointly research and develop the shared helicase target program and will share commercialization activities within the United States. Boehringer Ingelheim had agreed to assume responsibility for commercialization outside of the United States. On December 21, 2020, the Company received written notice from Boehringer Ingelheim that it elected to terminate the Collaboration Agreement without cause, and in accordance with the terms of the Collaboration Agreement. The termination became effective on January 31, 2021. The Target Project for the helicase target and the reciprocal licenses terminated as of this date. The Company is entitled to pursue the HAT target and helicase target programs in all fields worldwide without further obligation to Boehringer Ingelheim.

Agreement Structure

Under the terms of the agreement, the Company received a $15.0 million upfront payment and $5.0 million in research funding for the costs to be incurred by the Company in connection with its research activities, payable quarterly in four equal installments during 2019. At its discretion, Boehringer Ingelheim had the option to extend the research period by up to one year, subject to the Company’s agreement to the specified research activities and additional research funding. During the third quarter of 2019, Boehringer Ingelheim’s option to extend the research period expired unexercised, and therefore the research period ended on December 31, 2019. In March 2020, the Company and Boehringer Ingelheim amended the agreement to extend the research period for the shared program targeting enzymes within helicase families with Boehringer Ingelheim providing research funding of $0.4 million. Additionally, in March 2020, the Company received notice of termination for the program targeting enzymes with HAT families, which program termination became effective in June 2020. In September 2020, the Company and Boehringer Ingelheim further amended the agreement to extend the research period for the shared program targeting enzymes within helicase families with Boehringer Ingelheim to provide research funding of $0.1 million. The additional research activities were completed prior to the end of 2020.

Collaboration Revenue

Through December 31, 2021, the Company has recognized $26.0 million in total collaboration revenue since the inception of this collaboration. During the years ended December 31, 2021, 2020 and 2019, the Company recognized revenue of $0, $0.5 million and $23.8 million, respectively. The Company will not receive any additional revenue under the terms of its agreement with Boehringer Ingelheim.

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12. Sale of Future Royalties

On November 4, 2019, the Company entered into a loan agreement with BioPharma Credit PLC, or the Collateral Agent, and the Lenders, providing for up to $70.0 million in secured term loans to be advanced in up to three tranches, or the Loan Agreement. As of December 31, 2020, the Company had borrowed an aggregate principal amount under the first tranche of $25.0 million (the “Tranche A Note Payable”), the second tranche of $25.0 million (the “Tranche B Note Payable”), and the third tranche of $20.0 million (the “Tranche C Note Payable”) under the Loan Agreement. On November 3, 2020, the Company, the Collateral Agent and the Lenders amended and restated the Loan Agreement, (as amended and restated, the “Amended and Restated Loan Agreement”), to provide for, among other things, an additional secured term loan of $150.0 million, or the Tranche D Loan. On November 18, 2020, the Company borrowed the Tranche D Loan (See Note 13, Long-Term Debt).

On November 4, 2019, the Company also executed a purchase agreement (the “RPI Purchase Agreement”) with RPI. Pursuant to the RPI Purchase Agreement, the Company agreed to sell to RPI 6,666,667 shares of its common stock, a warrant to purchase up to 2,500,000 shares of common stock at an exercise price of $20.00 per share (the “Common Stock Warrant”), and all of the Company’s rights to receive royalties from Eisai with respect to net sales by Eisai of tazemetostat products in Japan pursuant to the Eisai License Agreement and any successor arrangement for Japan sales (the “Japan Royalty”, and collectively, the “Transaction”). In consideration for the sale of shares of common stock, the Common Stock Warrant and the Japan Royalty, RPI paid the Company $100.0 million upon the closing of the RPI Purchase Agreement. In addition, RPI agreed, in connection with RPI’s acquisition from Eisai of the right to receive royalties from the Company under the Eisai License Agreement, to reduce the Company’s royalty obligation by low single digits upon the achievement of specified annual net sales levels over $1.5 billion. In addition, under the RPI Purchase Agreement, the Company had the right to sell, and RPI had the obligation to purchase, subject to certain conditions, including a maximum purchase price of $20.00 per share, $50.0 million of shares of common stock at the Company’s option for an 18-month period from the date of execution of the RPI Purchase Agreement (the “Put Option”). In February 2020, the Company sold 2.5 million shares of its common stock to RPI, for an aggregate of $50.0 million in proceeds pursuant to the Put Option. Additionally, under the terms of the RPI Purchase Agreement, the founder and chief executive officer of RP Management, an affiliate of RPI, and a co-founder of Pharmakon Advisors LP, an affiliate of the Lenders was elected as a director of the Company. As of December 31, 2021 and 2020, RPI and its affiliates owned approximately 8.6% and 9.0% of the Company’s common stock, respectively.

The Company accounted for the Loan Agreement and RPI Purchase Agreement as a single arrangement as RPI and the Lenders are related parties and the agreements were negotiated together. The aggregate proceeds of $125.0 million were allocated on a relative fair value basis, which approximated their respective actual fair values, to the four units of accounting pursuant to the transaction as follows: (1) $79.0 million to the common stock issued to RPI based on the closing price of the Company’s common stock on the date of the transaction, (2) $8.4 million to the Common Stock Warrant to purchase shares of common stock, based on the Black-Scholes option pricing model, (3) $12.6 million to the liability related to the sale of future royalties based on a discounted cash flow model and (4) $25.0 million to the Tranche A Note Payable based on the terms of the Loan Agreement. Transaction costs of $2.0 million were allocated directly to the units of accounting it relates to.

Although the Company sold all of its rights to receive the Japan Royalty, under the terms of the RPI Agreement, the Company continues to own all tazemetostat intellectual property rights and at execution had significant continuing involvement in the generation of these royalties. Due to the Company’s continuing involvement, the Company will continue to account for any royalties due as revenue and recorded the proceeds from this transaction as a liability (“Royalty Obligation”) that will be accreted using the effective interest method over the estimated life of the RPI Purchase Agreement.

As royalties are remitted to RPI from Eisai, the balance of the Royalty Obligation will be effectively repaid over the life of the Eisai License Agreement. In order to determine the accretion of the Royalty Obligation, the Company is required to estimate the total amount of future royalty payments to RPI over the life of the Eisai License Agreement. The $12.6 million recorded at execution will be accreted to the total of these royalty payments as interest expense

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over the life of the Royalty Obligation. At execution, the Company’s estimate of this total interest expense resulted in an effective annual interest rate of approximately 9.01%. This estimate contains significant assumptions that impact both the amount recorded at execution and the interest expense that will be recognized over the royalty period. The Company periodically assesses the estimated royalty payments to RPI from Eisai and to the extent the amount or timing of such payments is materially different than the original estimates, an adjustment is made to the effective interest rate, which will be recorded prospectively to increase or decrease interest expense. There are a number of factors that could materially affect the amount and timing of royalty payments to RPI from Eisai, and correspondingly, the amount of interest expense recorded by the Company, most of which are not within the Company’s control. Such factors include, but are not limited to, delays or discontinuation of development of tazemetostat in Japan, regulatory approval, changing standards of care, the introduction of competing products, manufacturing or other delays, generic competition, intellectual property matters, adverse events that result in governmental health authority imposed restrictions on the use of the drug products, significant changes in foreign exchange rates as the royalties remitted to RPI are made in U.S. dollars (USD) while the underlying Japan sales of tazemetostat will be made in currencies other than USD, and other events or circumstances that are not currently foreseen as tazemetostat is still under development in Japan and subject to regulatory approval. Changes to any of these factors could result in increases or decreases to both royalty revenues and interest expense. On June 23, 2021, Eisai announced that it had obtained manufacturing and marketing approval for the EZH2 inhibitor “Tazverik® Tablets 200 mg” (tazemetostat hydrobromide) in Japan with the indication of relapsed or refractory EZH2 gene mutation-positive follicular lymphoma (only when standard treatment is not applicable), which caused the Company to reassess the estimated future royalty payments to RPI. As of December 31, 2021, the Company’s assessment of the estimated future royalty payments to RPI resulted in a current effective interest rate of approximately 9.19%.

The following table shows the activity of the Royalty Obligation since the transaction inception through December 31, 2021:

	Year Ended December 31, 2021
	(In thousands )
Proceeds from sale of future royalties	$	12,601
Non-cash royalty revenue		(31	)
Non-cash interest expense recognized		3,357
Liability related to the sale of future royalties - ending balance		15,927
Less current portion		(273	)
Related party liability related to sale of future royalties, net of current portion	$	15,654

During the year ended December 31, 2021, the Company recorded non-cash royalties from net sales of tazemetostat in Japan of less than $0.1 million. During the years ended December 31, 2020 and 2019, the Company did not record non-cash royalties from net sales of tazemetostat in Japan. During the years ended December 31, 2021, 2020 and 2019 the Company recorded $1.8 million, $1.4 million and $0.2 million, respectively, of related non-cash interest expense.

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13. Long-Term Debt

On November 4, 2019, the Company entered into the Loan Agreement, which provided for up to $70.0 million in secured term loans to be advanced in up to three tranches. The Company borrowed $70.0 million in the aggregate under the three tranches pursuant to the Loan Agreement. With the FDA’s June 2020 approval of tazemetostat for the treatment of FL in the United States, the Company also had the right, but not the obligation, to request up to an additional $300.0 million in secured term loans, subject to the approval of the Lenders, provided the Company has not prepaid any outstanding term loans at the time of such request and such request is made before November 18, 2021. On November 3, 2020, the Company entered into the Amended and Restated Loan Agreement with the Lenders. The Amended and Restated Loan Agreement provides for, among other things, an additional secured term loan of $150.0 million, or the Tranche D Loan. On November 3, 2020, the Company also delivered written notice to the Lenders to draw down the Tranche D Loan, which was funded on November 18, 2020. The Company paid a commitment fee of 2.00% of the original $70.0 million committed facility amount in November 2019 and 2% of the $150.0 million Tranche D Loan in November 2020, as well as expenses incurred by the Lender in executing the agreements.

The interest rate for the Tranche D Loan will be determined by reference to a Eurodollar rate plus 7.75% above such Eurodollar rate. The Eurodollar rate will have a 2.00% floor. The Tranche D Loan will be due in eight equal quarterly principal payments commencing on the 51st month anniversary of the date on which the Lenders fund the Tranche D Loan. All unpaid principal and interest under the Tranche D Loan will be due and payable on the 72nd month anniversary of the date on which the Lenders funded the Tranche D Loan.

The Amended and Restated Loan Agreement also amended the payment period principal and interest for the first three tranches of term loans. Under the original terms, the Company was required to make interest only payments on the outstanding obligation through February 28, 2023, and thereafter eight quarterly payments of principal and interest. Under the amended and restated terms, the Company is required to make interest only payments on the $70.0 million outstanding obligation through November 2023, and thereafter four quarterly payments of principal and interest. All unpaid principal and interest on the $70.0 million borrowed under the original Loan Agreement is due and payable in November 2024, the 60th month anniversary of the date on which the Lenders funded the first tranche of term loans. The interest rates for the existing tranches of term loans remain unchanged and will continue to be determined by reference to a Eurodollar rate plus 7.75% above such Eurodollar rate. The Eurodollar rate will have a 2.00% floor.

Each of the four term loans may be prepaid before maturity in whole or in part, however there is a $50.0 million minimum prepayment for any prepayment of the loans. If the Company prepays any tranche of term loans, in whole or in part, during the first 36 months from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to the greater of (x) a make-whole amount equal to the interest that would have accrued on the principal amount to be prepaid and (y) a premium equal to 0.03 multiplied by the principal amount to be prepaid. If the Company prepays a tranche of term loan, in whole or in part, between the 36th month and 48th month from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to 0.02 multiplied by the principal amount to be prepaid. If the Company prepays a tranche of term loans, in whole or in part, between the 48th month and 60th month from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to 0.01 multiplied by the principal amount to be prepaid.

The Amended and Restated Loan Agreement was accounted for as a debt modification based on a comparison of the present value of the cash flows under the terms of the debt immediately before and after the effective date of The Amended and Restated Loan Agreement, which resulted in a change of less than 10%. As a result, issuance costs paid to the Lenders in connection with The Amended and Restated Loan Agreement were recorded as a reduction of the carrying amount of the debt liability and unamortized issuance costs as of the date of the modification are amortized to interest expense over the repayment term of The Amended and Restated Loan Agreement.

The obligations under the Amended and Restated Loan Agreement, including the Company’s payment obligations in respect of the Tranche D Loan are secured by the first priority security interest in and a lien on substantially all of the assets of the Company, subject to certain exceptions, that the Company granted to the Lenders in connection with the first tranche of term loans under the Loan Agreement.

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The Amended and Restated Loan Agreement contains certain customary representations and warranties, affirmative and negative covenants and events of default applicable to the Company and its subsidiaries. If an event of default occurs and is continuing, the Collateral Agent may, among other things, accelerate the loans and foreclose on the collateral. The Company has determined that the risk of subjective acceleration under the material adverse events clause is not probable and therefore has classified the outstanding principal in non-current liabilities based on scheduled principal payments.

The Company has the following minimum aggregate future loan payments at December 31, 2021 (in thousands):

	Year Ended December 31, 2021
2022		—
2023		—
2024		70,000
2025		75,000
2026		75,000
Total minimum payments		220,000
Less amounts representing interest and discount		(3,539	)
Less current portion		—
Related party long-term debt, net of debt discount	$	216,461

For the years ended December 31, 2021, 2020 and 2019, interest expense related to the Company's Amended and Restated Loan Agreement was approximately $22.5 million, $7.2 million and $0.3 million, respectively. The total carrying value of debt is classified as long-term on the Company's consolidated balance sheet as of December 31, 2021 and 2020, respectively.

14. Stockholders’ Equity (Deficit)

Common Stock

On March 24, 2020, the Company’s board of directors adopted, subject to stockholder approval, an amendment to the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of common stock, $0.0001 par value per share, from 125,000,000 to 150,000,000 (the “Charter Amendment”). At the Company’s 2020 Annual Meeting of Stockholders, the stockholders of the Company approved the Charter Amendment, which was filed with the Secretary of State of the State of Delaware on May 29, 2020. On April 8, 2021, the Company’s board of directors adopted, subject to stockholder approval, an amendment to the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of common stock from 150,000,000 to 225,000,000 (the "2021 Charter Amendment"). At the Company’s 2021 Annual Meeting of Stockholders, the stockholders of the Company approved the 2021 Charter Amendment, which was filed with the Secretary of State of the State of Delaware on June 11, 2021. The number of authorized shares of preferred stock was not affected by these Charter Amendments.

Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to dividends when and if declared by the board of directors.

2021 At-the-Market Offering Program

On May 6, 2021, the Company entered into an Open Market Sale AgreementSM (“ATM Sale Agreement”), with Jefferies LLC (“Jefferies”) to sell, from time to time, shares of the Company's common stock having an aggregate offering price of up to $200.0 million through an “at the market offering” as defined in Rule 415 under the Securities Act of 1933, as amended, under which Jefferies would act as sales agent (the "ATM Offering"). The shares that may be sold under the ATM Sale Agreement, if any, are issued and sold pursuant to the Company’s shelf registration statement on Form S-3 that was declared effective by the Securities and Exchange Commission on May 13, 2021. The Company agreed to compensate Jefferies at a fixed commission rate equal to 3.0% of the gross sales proceeds of such shares.

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From the initiation of the ATM Offering through December 31, 2021, the Company has issued and sold 3,840,977 shares under the ATM Offering, resulting in aggregate net proceeds of $16.0 million after deducting issuance costs of $0.5 million.

RPI Put Option

In February 2020, the Company sold 2,500,000 shares of its common stock in connection with the exercise of its Put Option to sell shares of its common stock for an aggregate of $49.9 million in net proceeds after deducting financing costs of $0.1 million. (see Note 12, Sale of Future Royalties).

Convertible Preferred Stock

The Company has 337,800 shares of Series A Convertible Preferred Stock outstanding as of December 31, 2021 and 2020.

Voting Rights

Shares of Series A Preferred Stock will generally have no voting rights except as required by law and except that the consent of the holders of a majority of the outstanding shares of Series A Preferred Stock will be required to amend the terms of the Series A Preferred Stock or take certain other actions with respect to the Series A Preferred Stock.

Dividends

Shares of Series A Preferred Stock will be entitled to receive dividends equal to (on an as-if-converted-to-common stock basis), and in the same form and manner as, dividends actually paid on shares of the Company’s common stock.

Liquidation Rights

Subject to the prior and superior rights of the holders of any senior securities of the Company, upon liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, each holder of shares of Series A Preferred Stock shall be entitled to receive, in preference to any distributions of any of the assets or surplus funds of the Company to the holders of common stock, an amount equal to $0.001 per share of Series A Preferred Stock, plus an additional amount equal to any dividends declared but unpaid on such shares, before any payments shall be made or any assets distributed to holders of any class of common stock.

If, upon any such liquidation, dissolution or winding up of the Company, the assets of the Company shall be insufficient to pay the holders of shares of the Series A Preferred Stock the amount required under the preceding sentence, then all remaining assets of the Company shall be distributed ratably to holders of the shares of the Series A Preferred Stock in proportion to the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on or with respect to such shares were paid in full.

Conversion

Each share of Series A Preferred Stock shall be convertible, at any time and from time to time from and after the issuance date, at the option of the holder thereof, into a number of shares of common stock equal to 10 shares of common stock, provided that the holder will be prohibited from converting Series A Preferred Stock into shares of the Company’s common stock if, as a result of such conversion, the holder, together with its affiliates and attribution parties, would own more than 9.99% of the total number of shares of common stock then issued and outstanding. The holder can change this requirement to a higher or lower percentage, not to exceed 9.99% of the number of shares of common stock outstanding, upon 61 days’ notice to the Company.

In February 2020, 12,200 shares of Series A Preferred Stock were converted to 122,000 shares of common stock.

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Redemption

The Company is not obligated to redeem or repurchase any shares of Series A Preferred Stock. Shares of Series A Preferred Stock are not entitled to any redemption rights or mandatory sinking fund or analogous fund provisions.

Warrants

In November 2019, the Company issued the Common Stock Warrant for the purchase of up to 2,500,000 shares of Common Stock at an exercise price of $20.00 per share to RPI pursuant to the RPI Purchase Agreement (for additional information see Note 12, Sale of Future Royalties), which was classified as equity and recorded at its relative fair value of $8.4 million to additional paid-in-capital on the Company's consolidated balance sheets. The Common Stock Warrant remains outstanding as of December 31, 2021.

In August 2021, the Company issued the HutchMed Warrant to HutchMed under the HutchMed License Agreement, exercisable at any time prior to August 7, 2025 for up to 5,653,000 shares of the Company’s common stock at an exercise price of $11.50 per share. Under the HutchMed Warrant, the number of shares issuable under the warrant is reduced from 5,653,000 to 2,826,500 in the event that the HutchMed License Agreement is terminated for certain reasons as more fully described in the HutchMed License Agreement. Due to this provision, the Company concluded that the warrant does not meet the exception from derivative accounting pursuant to ASC 815, Derivatives and Hedging, which requires that the warrant be accounted for as a derivative. Accordingly, the Company recorded a warrant liability in the amount of approximately $13.0 million upon issuance. The fair value of the HutchMed Warrant was determined using a Black-Scholes and Monte Carlo pricing model.

The HutchMed Warrant is subject to revaluation at each balance sheet date and any changes in fair value are recorded as a non-cash gain or (loss) in the Company's consolidated statement of operations and comprehensive loss as a component of other income (expense), net until the earlier of the exercise or expiration of the HutchMed Warrant or upon the completion of a liquidation event.

The Company recorded non-cash gains of approximately $11.1 million during 2021 in its consolidated statement of operations and comprehensive loss attributable to the decreases in the fair value of the warrant liability that resulted from a reduction in the Company's stock price as of December 31, 2021.

The following table rolls forward the fair value of the HutchMed Warrant liability, the fair value of which is determined by Level 3 inputs at inception on August 7, 2021, and as of December 31, 2021:

		(In thousands)
Fair value at inception	$		13,050
Decrease in fair value			(11,120	)
Fair value at December 31, 2021	$		1,930

The key assumptions used to value the HutchMed Warrant were as follows:

	Inception			As of December 31, 2021
Risk-free interest rate		0.6	%		1.05	%
Expected term (in years)	4.0 years			3.6 years
Expected volatility of underlying stock		70.0	%		70.0	%
Expected dividend yield		-			-
Stock price	$	6.47		$	2.50

15. Employee Benefit Plans

Stock Incentive Plans

The Company maintains one stock incentive plan, the 2013 Stock Incentive Plan, as well as the 2013 Employee Stock Purchase Plan.

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In addition, during the year ended December 31, 2021, the Company granted options to purchase an aggregate of 248,366 shares of Epizyme common stock and 106,955 restricted stock units (RSUs) to four new employees as equity inducement awards outside of the Company's 2013 Stock Incentive Plan and material to the employees’ acceptance of employment with the Company. These equity awards were approved in accordance with Nasdaq Listing Rule 5635(c)(4), and these equity awards remained outstanding as of December 31, 2021. The options have a weighted average exercise price of $5.12 per share, and the RSUs have a weighted average grant date fair value of $5.08 per unit. These inducement awards are included in stock-based compensation expense and the following tables.

Stock-Based Compensation Expense

Stock-based compensation expense is classified in the consolidated statements of operations and comprehensive loss as follows:

	Year Ended December 31,
	2021		2020		2019
	(In thousands)
Research and development	$	8,360	$	9,093	$	6,295
General and administrative		18,427		18,516		11,721
Total	$	26,787	$	27,609	$	18,016

Stock Options

The weighted-average grant date fair value of options, estimated as of the grant date using the Black-Scholes option-pricing model. Weighted average assumptions used in this pricing model on the date of grant for options granted to employees are as follows:

	Year Ended December 31,
	2021			2020			2019
Risk-free interest rate		0.7	%		0.9	%		2.2	%
Expected life of options	5.89 years			5.99 years			6.0 years
Expected volatility of underlying stock		70.0	%		70.9	%		72.0	%
Expected dividend yield		0.0	%		0.0	%		0.0	%

The following is a summary of stock option activity for the year ended December 31, 2021:

	Number of Options			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
	(In thousands)					(In years)		(In thousands)
Outstanding at December 31, 2020		10,225		$	14.77
Granted		6,422			7.81
Exercised		(104	)		8.83
Forfeited or expired		(3,597	)		13.88
Outstanding at December 31, 2021		12,946		$	11.61		7.62	$	-
Exercisable at December 31, 2021		5,463		$	14.39		5.82	$	-

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During the years ended December 31, 2021, 2020 and 2019, the Company granted stock options to purchase an aggregate of 6,421,792 shares, 3,522,258 shares, and 4,222,693 shares, respectively, at weighted-average grant date fair values per option share of $4.79, $11.69, and $6.99, respectively. The total grant date fair value of options that vested during the years ended December 31, 2021, 2020 and 2019 was $27.2 million, $17.4 million, and $13.2 million, respectively. The aggregate intrinsic value of stock options exercised was $0.1 million in 2021, $5.5 million in 2020 and $1.2 million in 2019.

As of December 31, 2021, there was $37.3 million in unrecognized stock-based compensation related to stock options that are expected to vest. These costs are expected to be recognized over a weighted average remaining vesting period of 2.3 years.

Restricted Stock Units

During the year-ended December 31, 2021, 2,240,217 restricted stock units (“RSUs”) were granted to executives and employees and 105,944 RSUs were granted to non-employee directors. The awards were service-based. Assuming all service conditions are achieved, the executive and employee RSUs will vest as to 50%, 33%, and 25%, respectively, of the shares of Company common stock underlying the RSUs on an annual basis over two, three, or four year period of time from the grant dates, respectively, and the non-employee director RSUs will vest as to 100% of the shares of Company common stock underlying the RSUs in full on the earlier of the first anniversary of the grant date and the date of the succeeding annual meeting of stockholders.

	Number of Units			Weighted Average Grant Date Fair Value per Unit
	(In thousands except per share data)
Outstanding at December 31, 2020		668		$	17.56
Granted		2,346			7.74
Vested		(187	)		17.20
Forfeited		(605	)		12.15
Outstanding at December 31, 2021		2,222		$	8.70

Compensation expense totaling $4.9 million, $2.7 million, and $0.5 million was recognized for the service-based RSUs for the years-ended December 31, 2021, 2020 and 2019, respectively.

As of December 31, 2021, there was $14.3 million of unrecognized compensation cost related to service-based RSUs that are expected to vest. These costs are expected to be recognized over a weighted average remaining vesting period of 2.2 years.

During 2019, the Company granted 604,000 RSUs to executives and employees, which contained performance conditions, 20% of the RSUs vested on June 30, 2019, 25% of the RSUs vested on January 23, 2020, 20% of the RSUs vested on March 24, 2020, and 30% of the RSUs vested on June 25, 2020 in connection with achievement of the final performance milestone.

Compensation expense totaling $3.5 million and $3.6 million was recognized for the performance-based RSUs for the years-ended December 31, 2020 and 2019, respectively.

There was no unrecognized compensation cost as of December 31, 2020, related to performance-based RSUs, as all of the performance conditions have been achieved.

401(k) Savings Plan

The Company has a defined contribution 401(k) savings plan (the “401(k) Plan”). The 401(k) Plan covers substantially all employees, and allows participants to defer a portion of their annual compensation on a pretax basis. Company contributions to the 401(k) Plan may be made at the discretion of the board of directors. During the year

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ended December 31, 2014, the Company implemented a matching contribution to the 401(k) Plan, matching 50% of an employee’s contribution up to a maximum of 3% of the participant’s compensation. Company contributions to the 401(k) plan totaled $1.4 million, $1.2 million and $0.6 million in the years ended December 31, 2021, 2020 and 2019, respectively.

16. Loss per Share

As described in Note 2, Summary of Significant Accounting Policies, the Company computes basic and diluted earnings (loss) per share using a methodology that gives effect to the impact of outstanding participating securities (the “two-class method”). The two-class method was not applied for the years ended December 31, 2021, 2020, and 2019 due to the net loss recognized in each of those periods. In 2019 the net loss applicable to common stockholders did not equal net loss due to the accretion of the beneficial conversion feature of Series A Preferred Stock in the amount of $2.9 million. The beneficial conversion feature was initially recorded as a discount on the Series A Preferred Stock with a corresponding amount recorded to Additional Paid-in Capital. The discount on the Series A Preferred Stock was then immediately written off as a deemed dividend as the Series A Preferred Stock does not have a stated redemption date and is immediately convertible at the option of the holder.

Basic and diluted loss per share allocable to common stockholders are computed as follows:

	Year Ended December 31,
	2021			2020			2019
	(In thousands except per share data)
Net loss	$	(251,122	)	$	(231,694	)	$	(170,295	)
Accretion of Series A Preferred Stock		—			—			(2,940	)
Net loss attributable to common stockholders	$	(251,122	)	$	(231,694	)	$	(173,235	)
Weighted average shares outstanding		102,646			100,960			89,891
Basic and diluted loss per share allocable to common stockholders	$	(2.45	)	$	(2.29	)	$	(1.93	)

The following common stock equivalents were excluded from the calculation of diluted loss per share allocable to common stockholders because their inclusion would have been anti-dilutive:

	Year Ended December 31,
	2021		2020		2019
	(In thousands)
Stock options		12,946		10,225		8,087
Restricted stock units		2,222		669		757
Shares issuable under employee stock purchase plan	155		98		38
Series A Preferred Stock (if converted)		3,378		3,378		3,500
Warrants		8,153		2,500		2,500
		26,854		16,870		14,882

For the year ended December 31, 2019, the above table does not include the up to 6,250,000 shares subject to the Company’s option to sell additional shares to RPI pursuant to the Put Option as the decision to exercise this option was within the Company’s control. On December 30, 2019, the Company exercised its option to sell 2,500,000 shares of Common Stock to RPI for an aggregate of $50.0 million. The sale was effected on February 11, 2020.

17. Subsequent Events

Common Stock Offering

In January 2022, the Company raised approximately $79.5 million in net proceeds (after deducting underwriting discounts and commissions and estimated offering costs, but excluding any expenses and other costs reimbursed by

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the underwriters) from the sale of 56,666,667 shares of its common stock in a public offering at a price of $1.50 per share.

Operating Cost Reduction

On March 1, 2022, the Company announced a cross-functional reduction of approximately 12% of its current workforce under a cost reduction plan. Affected employees will be offered separation benefits, including severance payments along with temporary healthcare coverage assistance. The Company estimates that the severance and termination-related costs will be approximately $2.8 - 3.2 million and expects to record these charges in the first quarter of 2022. The Company expects that payments of these costs will be made through the end of the fourth quarter of 2022.

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EX-10.22

Exhibit 10.22

Certain identified information has been excluded from the exhibit because it is both (i) not material and (ii) is the type of information that the registrant treats as private or confidential.

Double asterisks denote omissions.

EXECUTION COPY
18th December 2012

COMPANION DIAGNOSTICS AGREEMENT

BETWEEN

EPIZYME, INC.

and

EISAI CO., LTD.

on the one side

AND

ROCHE MOLECULAR SYSTEMS, INC.

on the other side

Page 1 of 42

RMS – Epizyme/Eisai

CoDx Agr

Effective Date: 18 DEC 2012

This Companion Diagnostics Agreement (“Agreement”) is entered into and made effective this 18th day of December 2012 (the “Effective Date”) by and between Epizyme, Inc., having a place of business at 325 Vassar Street, Cambridge, Massachusetts 02139, U.S.A. (“Epizyme”) and Eisai Co., Ltd., having a place of business at Koishikawa 4-6-10, Bunkyo-ku, Tokyo 112-8088, Japan (individually, “Eisai” and collectively with Epizyme, “Pharmaceutical Partners”) on the one side and Roche Molecular Systems, Inc., having a place of business at 4300 Hacienda Drive, Pleasanton, California 94588, U.S.A.(“RMS”) on the other side.

1. PURPOSE

1.1. RMS is a diagnostics company with expertise and capability in researching, developing, manufacturing and marketing companion diagnostics, and wishes to collaborate with Pharmaceutical Partners in further developing its proprietary Assay (as defined below) as a potential companion diagnostic to the Pharmaceutical Partners Product (as further defined below).

1.2. Epizyme and Eisai collectively have expertise and capability in researching, developing, manufacturing and marketing human prophylactics and therapeutics, and are collaborating on the development and potential commercialization of certain therapeutic products for B-cell lymphoma and together wish to collaborate with RMS in developing a potential companion diagnostic to the Pharmaceutical Partners Product.

1.3. The Parties agree to the terms of a joint collaboration intended to develop and commercialize in vitro diagnostic and/or companion diagnostic tests for the Pharmaceutical Partners Product. The goal of the collaboration is to deliver diagnostic test(s) which will be available for the Pharmaceutical Partners Product clinical studies and commercial use and ultimately covered by Regulatory Approvals with the appropriate local Regulatory Authority (as defined below) in the Major Markets (as defined below) that is intended to guide treatment decisions of patients using the Pharmaceutical Partners Product and to support the life cycle management of the Pharmaceutical Partners Product.

2. DEFINITIONS

As used in this Agreement, the following initially capitalized terms, whether used in the singular or plural form, have the meanings set forth in this Article 2.

2.1. “AAA” has the meaning as set forth in Section 16.1.

2.2. “Acting Party” has the meaning as set forth in Section 8.9(b).

2.3. “Affiliate” means, with respect to a Party, any entity which directly or indirectly controls, is controlled by, or is under common control with such Party, where control means the direct or indirect ownership of fifty percent (50%) or more of the outstanding voting equity interests of an entity or such other relationship as results in actual control over the management, assets, business and affairs of an entity; provided, however, that, as to RMS, the term “Affiliate” does not include Chugai.

2.4. “Agreement” shall mean this Companion Diagnostics Agreement between Epizyme, Eisai and RMS.

2.5. “Assay” means an assay developed by RMS that is directed to mutations [**] of EZH2 and such other mutations as the Parties may agree, and shall include without limitation any biological materials, associated reagents, procedures, controls, instrumentation and/or software necessary to perform the assay, but shall exclude any Samples or other materials that the Assay is intended to test.

2.6. “Assay Development” means the development of the Assay (including software development), the technical validation and verification of the RMS Product, Clinical Validation, clinical reproducibility studies of the RMS Product, the manufacturability of the RMS Product and preparing and submitting to the Regulatory Authorities applications for, and obtaining and maintaining, Regulatory Approvals for the RMS Product.

Page 2 of 42

2.7. “Assay Performance Data” means all data, information, results and reports that are related to the performance of the RMS Product including, but not limited to, data generated in connection with this Agreement during technical performance validation studies, clinical reproducibility studies and Clinical Validation Data, but excluding Clinical Patient Data.

2.8. “Background IP” means any proprietary technology, know-how, data, information, materials, methods, processes, protocols, granted patents or pending patent applications (together with any granted patents resulting from such applications), related to the RMS Product (or any proprietary components thereof), the RMS Technology and/or the Pharmaceutical Partners Product, and/or the manufacture or use of any of the foregoing, in each case that: (i) as of the Effective Date exists and is Controlled by a Party or its Affiliates; or (ii) on or after the Effective Date is independently developed or acquired and Controlled by a Party or its Affiliates other than in connection with the performance of the Agreement. For clarity, the Target Know-How is not the Background IP of any Party.

2.9. “CDAs” means both (a) the Mutual Confidential Disclosure Agreement executed between Epizyme and Ventana Medical Systems, Inc., an Affiliate of RMS, effective 6th September 2011, and applied to RMS via written notice dated 8th May 2012; and (b) the Mutual Confidential Disclosure Agreement executed between Eisai, RMS and Ventana Medical Systems, Inc., an Affiliate of RMS, effective 11th May 2012.

2.10. “CE-IVD” shall mean approved CE Marking according to the Requirements of European Directive 98/79/EC of the European Parliament and of the council of 27 October 1998 on in vitro diagnostic medical devices (IVDD) or its successor Directive.

2.11. “Changes” has the meaning as set forth in Section 3.2.

2.12. “Chugai” means Chugai Pharmaceutical Co., Ltd, 1-1 Nihonbashi-Muromachi 2-Chome, Chuo-ku, Tokyo 103-8324, Japan.

2.13. “Clinical Patient Data” means all data, information, results and reports that are related to patients in connection with clinical studies of the Pharmaceutical Partners Product, including Clinical Utility data and patient data associated with Clinical Samples resulting from activities under or in connection with this Agreement (e.g., clinical outcomes data), but excluding Clinical Validation Data.

2.14. “Clinical Samples” means Samples obtained from patients pursuant to a clinical trial of the Pharmaceutical Partners Product.

2.15. “Clinical Utility” means the use of test results to select patients that will benefit from the use of the Pharmaceutical Partners Product, to de-select patients that will not benefit from the use of the Pharmaceutical Partners Product or for whom the risks of use of the Pharmaceutical Partners Product would outweigh the benefits, to determine or predict disease prognosis from the use of the Pharmaceutical Partners Product, or to otherwise affect health outcomes associated with the Pharmaceutical Partners Product.

2.16. “ClinicalValidation” means activities conducted to demonstrate that the RMS Product may be used to detect EZH2 change of function mutations in the catalytic domain through testing of Samples, including Clinical Samples, as well as the comparison of data from testing of Samples, including Clinical Samples, with the RMS Product and a comparator product or other sequencing assay.

2.17. “ClinicalValidation Data” means the aggregated statistical data generated by RMS during Clinical Validation showing the performance of the RMS Product through the testing of Samples, including Clinical Samples, and the comparison of such performance to the performance of a comparator product or other sequencing assay for the accuracy of the detection of EZH2 change of function mutations in the catalytic domain, as well as any analysis or other analytical performance/calculations thereon. For clarity, Clinical Validation Data excludes the underlying data as to whether or not EZH2 change of function mutations in the catalytic domain have been detected in a given Clinical Sample (which underlying data shall be Clinical Patient Data).

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2.18. “CoDx” means an IVD whose use is necessary to safe and effective prescription, administration or dosing of a specific drug, such as without limitation by performing any or all of the following functions, (a) stratifying a group of patients so that those who would likely respond to the specific drug are identified, or (b) stratifying a group of patients so that those who would likely not respond to, or would be contraindicated for treatment with, the specific drug are identified.

2.19. “Collaboration Agreement” means that certain Collaboration and License Agreement, dated as of April 1, 2011, between Epizyme and Eisai, as amended.

2.20. “Commercialization Strategy”has the meaning as set forth in Section 6.1.

2.21. “Commercially Reasonable Efforts” means, with respect to an objective, the reasonable, diligent, good faith efforts of a Party of the type to accomplish such objective that a company would normally use to accomplish a similar objective.

2.22. [**].

2.23. [**].

2.24. “Confidential Information”means any and all data, including Pharmaceutical Partners Information and RMS Information, either Party’s Know-How, and either Party’s or its Affiliate’s organizational structure, that is (a) disclosed by or on behalf of a Party to another Party during the Term and in connection with this Agreement and which is identified, as proprietary or confidential, either orally or in writing by the disclosing Party at the time of disclosure, or (b) known to the receiving Party as a consequence of or through performance of this Agreement, and which is not publicly known; provided that Pharmaceutical Partners shall be deemed to be the disclosing Parties and RMS shall be deemed to be the receiving Party with respect to Clinical Patient Data, Pharmaceutical Partners’ Background IP and Pharmaceutical Partners Project Inventions and RMS shall be deemed to be the disclosing Party and the Pharmaceutical Partners shall be deemed to be the receiving Parties with respect to Assay Performance Data, RMS’ Background IP and RMS Project Inventions, in each case, regardless of the Party that actually discloses such information.

2.25. “Contract Laboratories” has the meaning as set forth in Section 5.7. For purposes of clarity, Contract Laboratories are a category of Third Party Agents, as defined in Section 2.92.

2.26. “Control”or “Controlled” means with respect to Patents or other intellectual property assets, that a Party has the right to grant a license or sublicense to such assets (whether through ownership, license or otherwise) without violating the terms of any written agreement with any Third Party.

2.27. “Deferred Fee” has the meaning set forth in Section 15.7(b).

2.28. “Device Authorization Application” means (a) a U.S. pre-market approval application (“PMA”) for a Class III medical device or de novo classification petition or premarket notification, including all information submitted with or incorporated by reference, or (b) any analogous application to those set forth in (a) that is filed with the relevant Regulatory Authority in a country or region in the Territory.

2.29. “Diagnostic Field” means in vitro testing for research use, or exploratory use, or as a clinical diagnostic for use in the diagnosis and/or on-going evaluation of a disease or medical condition, including the prediction and/or monitoring of a response to a therapeutic agent, prognostic use, and also use as an IVD.

2.30. “Due Date” has the meaning as set forth in Section 7.2.

2.31. “Effective Date” means the date on which this Agreement is entered into and made effective, as set forth in the header of this Agreement.

2.32. “EZH2” means Enhancer of Zestehomolog 2.

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

2.34. “FD&C Act” means the United States Federal Food, Drug, and Cosmetic Act of 1938, as amended, and all implementing regulations.

2.35. “HIPAA” has the meaning as set forth in Section 10.4.

2.36. “IND” means (i) 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 (ii) all supplements and amendments that may be filed with respect to the foregoing.

2.37. “Indemnitee” has the meaning set forth in Section 12.3.

2.38. “Indemnitor” has the meaning set forth in Section 12.3.

2.39. “IUO” means an Assay that is labeled for “investigational use only”.

2.40. “IVD” means an in vitro diagnostic product (as defined in § 809.3(a) of the FD&C Act or under comparable regulation in jurisdictions outside the United States) and which is intended for use to predict disease prognosis and/or the safety or efficacy of therapeutic treatment.

2.41. “Independent Development”has the meaning as set forth in Section 9.12.

2.42. “Joint Patents”has the meaning as set forth in Section 8.7.

2.43. “Joint Invention” has the meaning as set forth in Section 8.5.

2.44. “JSC” has the meaning assigned to it in Section 4.2.

2.45. “JSC Chair” has the meaning as set forth in Section 4.2(c).

2.46. “Key Assumptions” shall mean the assumptions that are identified as key for the defined Project Plan and provide the basis for the Payment Plan. As of the Effective Date, the Key Assumptions for the initial Project Plan are identified in Exhibit C, attached hereto.

2.47. “Know-How” means any information, data, Materials, reagents, chemical compounds, inventions whether or not patentable, improvements, practices, formula, techniques, methods, procedures, protocols, knowledge, skill, experience, results, and any information regarding marketing, pricing, distribution, cost, sales or manufacturing.

2.48. “Liabilities” has the meaning set forth in Section 12.1.

2.49. “Major Markets” means the countries in which RMS will market and/or sell the RMS Product during the Term. As of the Effective Date, the term Major Markets means the countries identified in Exhibit D, attached hereto. Such countries may be expanded per Section 3.5.

2.50. “Material” shall mean the biological materials, including Samples, cells, cell lines, genes, gene fragments, gene sequences, probes, DNA, RNA, cDNA libraries, proteins, peptides, polypeptides, plasmids, vectors, expression systems, organisms, biological substances, and any constituents, progeny or replications thereof or therefrom, provided or acquired by, or provided or acquired on behalf of, one Party pursuant to this Agreement as set forth in the Project Plan.

2.51. “NDA”means a New Drug Application or its equivalent (and including any amendments or supplements thereto) that is filed pursuant to the requirements of the FDA, as defined in § 314 et seq. and § 355 of FD&C Act, to obtain FDA approval to commercialize a pharmaceutical product in the United States.

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2.52. “Option Period” has the meaning set forth in Section 9.13(a).

2.53. “Owned Trademark” has the meaning as set forth in Section 6.3.

2.54. “Party” or “Parties” refers individually or collectively to Epizyme, Eisai and RMS.

2.55. “Party’s Know-How” means with respect to any Party, Know-How that (a) was developed or acquired by such Party on or before the Effective Date or (b) is independently developed or acquired by such Party after the Effective Date but not in connection with the performance of this Agreement. For purposes of clarity, a Party’s Know-How does not include any Assay Performance Data, Clinical Patient Data or Target Know-How.

2.56. “Patent” means any existing or future (a) national, regional or international patent or patent application in the Territory (including without limitation any provisional, divisional, continuation, continuation-in-part, non-provisional, converted provisional, or continued prosecution application, any utility model, petty patent, design patent and/or certificate of invention), (b) any extension, restoration, revalidation, reissue, re-examination and extension (including any supplementary protection certificate and the like) of any of the foregoing patents or patent applications, and (c) any ex-U.S. equivalents corresponding to any of the foregoing.

2.57. “Payment Plan” means the schedule of payments made by Pharmaceutical Partners to RMS upon completion of specific activities defined in the Project Plan.

2.58. [**].

2.59. “Pharmaceutical Field” shall mean the discovery, development, manufacture, use, and/or sale of biological or chemical substances for the cure, treatment, or prevention of diseases or conditions of human beings.

2.60. “Pharmaceutical Partners Indemnitees” has the meaning set forth in Section 12.2.

2.61. “Pharmaceutical Partners Information” means all Know-How, and other items that are Controlled by Epizyme or Eisai, individually or collectively and are supplied or otherwise made available, directly or indirectly, to RMS by or on behalf of Epizyme or Eisai or any of their respective Affiliates pursuant to performance under this Agreement. Notwithstanding the foregoing, Pharmaceutical Partners Information includes but is not limited to clinical protocols, clinical data, screening data, patient stratification, clinical patient outcomes, Clinical Patient Data and any information that may be derived from or related to any visits by RMS personnel to Epizyme’s and/or Eisai’s or their Affiliates’ premises, pursuant to this Agreement. Pharmaceutical Partners Information shall not include Assay Performance Data, Project Inventions or Target Know-How.

2.62. “Pharmaceutical Partners Patient Materials”has the meaning set forth in Section 5.3.

2.63. “Pharmaceutical Partners Product”shall mean the EZH2 inhibitor pharmaceutical product E7438, being developed and/or commercialized by Pharmaceutical Partners or their Affiliates for B-cell lymphoma and related indications. The Pharmaceutical Partners Product may be modified or expanded in accordance with the procedures set forth in Section 3.3, and any license rights granted around the Pharmaceutical Partners Product shall be concurrently and automatically modified in accordance with Section 9.8.

2.64. “Pharmaceutical Partners Project Invention” has the meaning as set forth in Section 8.5.

2.65. “PHI” has the meaning as set forth in Section 10.4.

2.66. “Privacy Rule” has the meaning as set forth in Section 10.4.

2.67. “Project” means the program of activities to be performed under a Project Plan with the goal of developing a RMS Product intended for use in the Diagnostic Field in connection with the development and/or commercialization of the Pharmaceutical Partners Product.

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2.68. “Project Invention” means any new proprietary technology, Know-How, materials, methods, processes, protocols, inventions or discoveries (whether or not patentable) generated by employees or agents of a Party (or its Affiliates), either solely or jointly with employees or agents of the other Party (or its Affiliates) in the performance of activities under a Project Plan or otherwise in connection with this Agreement other than Clinical Patient Data or Assay Performance Data. For clarity, Project Inventions will include, without limitation, any improvements or modifications to a Party’s Background IP that are generated in performance of activities under a Project Plan or otherwise in connection with this Agreement.

2.69. “Project Plan” means the detailed plan describing the activities agreed to by the Parties that will be performed by each of Epizyme, Eisai, their respective Affiliates and/or Third Party Agents, on the one hand with the development of the Pharmaceutical Partners Product, and RMS, its Affiliates and/or Third Party Agents, on the other hand, in connection with the development of the RMS Product.

2.70. “Project Team” has the meaning as set forth in Section 4.1.

2.71. “Publication” has the meaning as set forth in Section 14.2.

2.72. “Regulatory Approval” means (i) with respect to an IVD, approval or clearance of a Device Authorization Application granted by the FDA, (ii) with respect to a Pharmaceutical Partners Product, NDA approval granted by the FDA, and/or (iii) any approval analogous to those set forth in (i) or (ii) that is granted by the relevant Regulatory Authorities in one or more countries in the Territory.

2.73. “Regulatory Authority” means, as applicable, the FDA, the European Medicines Agency, and/or any other analogous regulatory authority or agency in a country or region in the Territory for the RMS Product or the Pharmaceutical Partners Product.

2.74. “Regulatory Change” has the meaning set forth in Section 3.2.

2.75. “RMS Indemnitees” has the meaning set forth in Section 12.1.

2.76. “RMS Information” means all Know-How and other items that are Controlled by RMS or its Affiliates, individually or collectively, and are supplied or otherwise made available, directly or indirectly, to Epizyme and/or Eisai, by or on behalf of RMS or its Affiliates pursuant to performance under this Agreement. For purposes of clarity, RMS Information includes but is not limited to RMS proprietary information around RMS Technology, technical validation and verification data of the RMS Product outside the Project Plan, and manufacturability data of the RMS Product; or any information that may be derived from or related to any visits by Epizyme and/or Eisai and their Affiliates to RMS’ premises, pursuant to this Agreement. RMS Information shall not include Clinical Patient Data, Project Inventions or Target Know-How.

2.77. “RMS Product” means a CoDx, IVD, IUO or an RUO, based on the Assay as well as the platform RMS Technology, being developed and/or commercialized by RMS or its Affiliates under the Project Plan.

2.78. “RMS Project Invention” has the meaning set forth in Section 8.5.

2.79. “RMS Technology” shall mean any RMS’ proprietary technologies, such as technologies relating to the Assay or to RMS’ instruments or platforms and related software, which is developed, or Controlled by RMS either during this Agreement or before the Effective Date, for purposes that are not pursuant to this Agreement. RMS Technology shall not include Target Know-How.

2.80. “RUO” means an Assay that is intended and labeled for “research use only”.

2.81. “Sample” means any patient samples, human cell lines, tissues, blood samples, clinical isolates, or other similar human-derived materials that are collected and/or otherwise made available pursuant to the Agreement for use in connection with a Project Plan, including without limitation for the development, testing and/or validation of the RMS Product.

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2.82. “Senior Officers” has the meaning as set forth in Section 4.3.

2.83. “Sponsoring Party” has the meaning as set forth in Section 4.1(b).

2.84. “Standard Terms” has the meaning as set forth in Section 5.7(c).

2.85. “Support” has the meaning as set forth in Section 5.7(c).

2.86. “Supporting Party” has the meaning as set forth in Section 8.9(b).

2.87. “Target Know-How” means Project Inventions relating to EZH2 and the genetic markers associated therewith, including without limitation any mutations with respect thereto.

2.88. “Term” has the meaning as set forth in Section 15.1.

2.89. “Termination Fee” has the meaning set forth in Section 15.7(b).

2.90. “Territory”means worldwide.

2.91. “Third Party” means any individual or entity other than Epizyme, Epizyme’s Affiliates, Eisai, Eisai’s Affiliates, RMS, or RMS’ Affiliates.

2.92. “Third Party Agent” means any Third Party who is contracted by a Party to provide services under a Project Plan.

2.93. “Third Party Claim” has the meaning set forth in Section 12.1.

2.94. “Trademark” means all trademarks, service marks, trade names and logos, whether registered or not, as well as all applications thereto, and all goodwill associated therewith.

3. PROJECT AND PROJECT PLAN

3.1. Project. Epizyme, Eisai and RMS will perform the Project in accordance with the Project Plan and this Agreement for the development of the RMS Product. The initial Project Plan is attached hereto as Exhibit A, with the associated Payment Plan and Key Assumptions attached hereto as Exhibit B and Exhibit C, respectively. The initial Project Plan includes timeframes that are tied to specific activities and based upon contingent actions of the Parties. Work on the Project Plan will be initiated as soon as practicable after the Effective Date of this Agreement.

3.2. Modifications to Project Plan. If either Party becomes aware of any changes of the Key Assumptions or of any other circumstances outside of the control of the Parties, such as changes in the regulatory environment, which could reasonably be expected to result in a material impact on the Project Plan or RMS’ ability to obtain Regulatory Approval for or commercialize the RMS Product in the Major Markets (the “Changes”), then such Changes shall be promptly reported to the other Party, and the Parties shall negotiate in good faith an amended Project Plan and Payment Plan taking into account such Changes. For clarity, the Parties are assuming that for the countries in the Major Markets, aside from the United States and Japan, all such countries shall accept CE-IVD filing for obtaining Regulatory Approval on the RMS Product, without the need for further testing, data or registrational studies, but any changes in the regulatory environment which alters this assumption with respect to such a country prior to obtaining Regulatory Approval for such a country (a “Regulatory Change”) shall not be deemed to be a Change subject to the provisions of this Section 3.2, provided that, unless Pharmaceutical Partners agree to reimburse RMS for all incremental out-of-pocket costs that RMS is required to incur in order to obtain the requisite Regulatory Approval for the RMS Product (but not any separate submission for the RMS Technology that is not specific to the RMS Product) in the applicable country as a result of such Regulatory Change, the country affected by such Regulatory Change shall be excluded from the Major Markets unless and until such country is reinstated as a Major Market pursuant to Section 3.5. Any dispute with respect to any amendments to the Project Plan or Payment Plan in connection with any Change shall be resolved according to Sections 4.2 and, if necessary, 4.3. Notwithstanding

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anything in this Agreement to the contrary, unless otherwise agreed by the Parties, there shall be no change to the Payment Plan, and RMS shall not have the right to terminate the Agreement, in connection with any Change to the extent that such Change results from or arises out of RMS’ negligence or failure to exercise due care in the performance of its obligations under this Agreement. For any amendments to the Project Plan relating to Changes or for any agreed upon modifications to the Project Plan independent of any Changes which does not lead to an increase or decrease of the amended or modified Payment Plan, the Project Team shall have the authority to agree, approve and sign off such modified Project Plan. If the Project Team is unable to agree on an amended or modified Project Plan, the escalation process according to Section 4.2(d) shall apply. If and to the extent the above amendment or modification of the Project Plan leads to an increase or decrease of the amended or modified Payment Plan, the Project Team shall submit to the JSC the amended or modified Project Plan and only the JSC shall have the authority to recommend approval of such amended or modified Project Plan (including associated amendment or modification to the Payment Plan) provided that such amended or modified Project Plan and Payment Plan shall not become effective unless agreed upon in writing and signed by authorized representatives of Epizyme, Eisai and RMS, such agreement not to be unreasonably withheld, delayed or conditioned. If the JSC is unable to recommend approval of an amended or modified Project Plan, including an amended or modified Payment Plan reflecting the appropriate increase or decrease in resulting incremental costs, the escalation process according to Section 4.3 and Article 16, respectively shall apply.

3.3. Change to Pharmaceutical Partners Product Designation. Pharmaceutical Partners may propose that the definition of Pharmaceutical Partners Product be modified or expanded in the future to include other pharmaceutical products that target EZH2 by providing written notice to RMS, including details related to development of such pharmaceutical products, to the extent such details are required for development of a RMS Product, and upon delivery of such notice, the definition of Pharmaceutical Partners Product shall automatically be amended to replace and/or include such identified pharmaceutical product; provided that RMS shall not be obligated to perform any additional activities in order to obtain approval from the relevant Regulatory Authorities for a RMS Product for such new pharmaceutical products that would require that it incur any additional expenses except as agreed by the Parties through the execution of a revised or new Project Plan and Payment Plan to compensate RMS for any such activities. In the event that Pharmaceutical Partners Background IP relating to such new pharmaceutical product exists, and is not licensed to RMS under the Agreement, such Pharmaceutical Partners Background IP relating to such new pharmaceutical product will be licensed to RMS under the same terms as other Pharmaceutical Partners Background IP licensed in accordance with Article 9 hereunder. In the event that RMS Background IP relating to such new pharmaceutical product exists, and is not licensed to Pharmaceutical Partners under the Agreement, such RMS Background IP relating to such new pharmaceutical product will be licensed to Pharmaceutical Partners under the same terms as other RMS Background IP licensed in accordance with Article 9 hereunder; provided, however, if such RMS Background IP is Controlled by RMS and, as of the date of notice regarding a proposed change in the definition of Pharmaceutical Partners Product, such Control includes incurring financial or other material obligations to any Third Party in excess of such obligations that applied with respect to the Pharmaceutical Partners Product as defined prior to such proposed change, then such RMS Background IP shall be not be automatically licensed to Pharmaceutical Partners under the Agreement under the same terms as other RMS Background IP. In such circumstance, RMS agrees to negotiate in good faith with the Pharmaceutical Partners for commercially reasonable terms of a sublicense to such RMS Background IP to grant similar licenses of the scope given under Section 9.2 with respect to other RMS Background IP.

3.4. Project Obligations and Responsibilities.

(a) Diligence. Each Party will use Commercially Reasonable Efforts to perform its obligations under this Agreement, particularly to successfully complete the activities for which it is responsible under the Project Plan and this Agreement in accordance with applicable standards currently recognized by the Parties’ profession or industry. Each Party shall be responsible for the quality, technical accuracy, and completeness of all data, and any other items to be generated or provided by them under this Agreement. Each Party shall also be responsible for the professional quality, training, and supervision of all its Affiliates’, and its Third Party Agents’ personnel who perform any activities under the Project Plan. RMS shall undertake its obligations under this Section 3.4 in good faith, using Commercially Reasonable Efforts to diligently meet the milestones set forth in the Project Plan. In no event shall RMS’ obligation to use Commercially Reasonable Efforts to perform its obligations under this Agreement be reduced as a result of any Change to the extent that such Change results from or arises out of RMS’ negligence or failure to exercise due care in the performance of its obligations under this Agreement.

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(b) Compliance with Laws and Regulations. Each of RMS, Epizyme and Eisai shall, and shall ensure that their respective Affiliates and/or Third Party Agents shall, comply with all applicable laws, rules and regulations in connection with the performance of the Project Plan and their obligations under this Agreement, including, with respect to RMS, commercialization of the RMS Product. In addition, each of RMS, Epizyme and Eisai shall, and shall ensure that their respective Affiliates and/or Third Party Agents shall, comply, as applicable, with current Good Laboratory Practices, Good Clinical Practices and/or Good Manufacturing Practices, applicable inspection requirements, and other applicable laws, including 21 C.F.R Parts 50, 54, 56, and 812, in connection with the performance of the Project Plan and their obligations under this Agreement, including, with respect to RMS, commercialization of the RMS Product, and shall generate, prepare, maintain, and retain all regulatory documentation, including Regulatory Approval applications, Regulatory Approvals, 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 in accordance with applicable law and regulation, and ensure that all such information is true, complete and correct and what it purports to be.

(c) Timeframes for Performance. The Parties will use Commercially Reasonable Efforts to complete their respective obligations under the Project Plan within the timeframes specified in the Project Plan. Each Party will promptly inform the other Party in the event that it anticipates or experiences a delay in the completion of such activities. Each Party shall be responsible for any delay or failure by it (its Affiliates, or its Third Party Agents) to timely complete its obligations under the Project Plan, except to the extent that (i) such failure or delay is caused by a delay or failure of performance by any other Party; or (ii) as may otherwise be mutually agreed in writing by the Parties.

(d) Responsibility for RMS Product. Except as may otherwise be expressly agreed to in writing by the Parties, RMS shall be responsible for the development, Regulatory Approval and commercialization of the RMS Product, including but not limited to the Assay Development.

(e) Responsibility for Pharmaceutical Partners Product. Pharmaceutical Partners and their Affiliates are and shall remain responsible, at their own expense and as determined in their sole discretion, for the development and commercialization of the Pharmaceutical Partners Product.

3.5. Expansion of the Major Markets.In the event that Pharmaceutical Partners seek to commercialize the Pharmaceutical Partners Product in countries outside the Major Markets and require RMS to obtain Regulatory Approval and commercialize the RMS Product in such countries, Pharmaceutical Partners shall notify RMS of such plans in writing. If at such time RMS is commercializing in such countries, directly or through Affiliates and/or Third Parties, products utilizing a comparable platform as the RMS Technology, the Major Markets shall be expanded to include such countries, subject to Pharmaceutical Partners agreeing to reimburse RMS for all incremental out-of-pocket costs that RMS is required to incur in order to obtain the requisite Regulatory Approvals for the RMS Product (but not any separate submission for the RMS Technology that is not specific to the RMS Product) in such countries. If Pharmaceutical Partners request that the Major Markets be expanded to countries other than countries in which RMS is commercializing, directly or through Affiliates and/or Third Parties, products utilizing a comparable platform as the RMS Technology, the Parties shall discuss whether to expand the Major Markets to include any such proposed additional country and, in connection with any agreement by the Parties to expand the Major Markets to include such country, the Parties shall enter into a mutually agreeable amendment to the Project Plan and associated Payment Plan.

3.6. Exclusivity. The relationship of the Parties under this Agreement is non-exclusive. Each Party’s rights to independently develop products is outlined further in Section 9.12 below.

4. GOVERNANCE

4.1. Project Team. On or shortly after the Effective Date, the Parties shall appoint appropriate representatives to the joint project team for the Project being carried out under this Agreement (the “Project Team”). Membership of the Project Team shall be comprised of employee representatives from RMS, employee representatives from Epizyme and employee representatives from Eisai. Each Party’s Project Team representatives shall have appropriate technical expertise and experience in disciplines relevant to the Project (including without limitation Assay Development, clinical drug development, regulatory matters, and project management). Any of a Party’s representatives to the Project Team may be replaced at any time by that Party, with written notice to the other Parties,

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and the Party’s representatives should reflect the required expertise and competencies with respect to the relevant phase of the Project Plan during such appointment.

(a) Responsibilities of the Project Team. The primary responsibility of the Project Team will be to coordinate and manage the performance of the day-to-day activities being carried out under the Project Plan, and to facilitate communications and the exchange of data and information related to the Project. Specific Project Team responsibilities shall include:

•Reviewing and evaluating periodically the status, progress and results of work being performed under the Project Plan;

•Reviewing the timing of the start of each new activity with respect to an unearned milestone; and

•Agreeing, approving and signing off on amended or modified Project Plans in accordance with Section 3.2.

(b) Project Team Meetings. The Project Team will meet on a regular basis, with the schedule to be agreed upon by the Parties. The Project Team will determine its meeting locations, and whether to conduct a meeting in-person, by teleconference, or videoconference. Each Party is responsible for all out-of-pocket costs and expenses incurred by it in connection with its participation in meetings of the Project Team. Each Party may invite others of its permanent or temporary employees to attend and participate in relevant portions of the Project Team meeting as necessary. A Party (“Sponsoring Party”) shall notify the other Parties’ Project Leaders (defined below) in writing in the event that it wishes to invite a Third Party to attend a Project Team meeting. Any such notice shall be provided at least [**] business days prior to the relevant Project Team meeting and shall identify the relevant Third Party, and briefly describe the reasons that the Sponsoring Party wishes to include the Third Party in the meeting. The attendance and participation of such Third Party shall be subject to the prior written consent of the Parties receiving such notice (such consent not to be unreasonably withheld). Any such consent granted by a Party shall be conditioned upon the Third Party being bound by a written confidentiality and non-use agreement that is reasonably acceptable to the consenting Party. In the event that attendance of such Third Party contractor at a subsequent Project Team meeting approval shall not be required for any Third Party who was previously approved by the other Parties and remains bound by an appropriate written confidentiality and non-use agreement at the time of the Project Team meeting, provided that the Sponsoring Party gives the other Parties prior notice of such attendance and the other Parties do not revoke their consent. The Parties respective Project Leaders shall be responsible for ensuring compliance with the foregoing.

(c) Project Leaders. Each Party shall designate one of its appointed members of the Project Team as its primary point of contact and lead representative for matters related to the Project (each, a “Project Leader”). Meetings of the Project Team shall be jointly chaired by the Project Leaders. A Party may change its designated Project Leader by providing written notice to the other Parties to that effect. The Project Leaders will be responsible for establishing meeting schedules and agendas, for generating mutually acceptable minutes of Project Team meetings and for any other administrative matters related to Project Team meetings. The Project Leader may elect to delegate these responsibilities to other members of the Project Team. The Project Leaders may elect to rotate and/or otherwise allocate those responsibilities between themselves.

(d) Project Team Decisions. The Project Team will make its decisions, and approve all of its actions, by unanimous consent of the Project Team Leaders, provided that the Epizyme Project Leader and the Eisai Project Leader shall have one collective vote (which shall be settled solely between the Epizyme Project Leader and the Eisai Project Leader), and the RMS Project Leader shall have one vote to resolve all of the Project Team’s decisions and approved actions. All decisions of the Project Team shall be documented in the Project Team’s meeting minutes. If the Project Team is unable to resolve a dispute regarding any matter within the Project Team’s authority, the matter will be referred to the JSC for resolution in accordance with Section 4.2(d).

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4.2. Joint Steering Committee. Within [**] days after the Effective Date, the Parties will form a joint steering committee (the “JSC”) comprised of up to [**] senior employee representatives from RMS and up to [**] senior employee representatives collectively from Pharmaceutical Partners. Each representative to the JSC will be appointed by a Party, and also may be replaced at any time by that Party, with written notice to the other Parties. A Party’s appointed JSC members will have appropriate expertise, experience and decision making authority to carry out their responsibilities as members of the JSC, and may not at the same time serve as a member of the Project Team.

(a) Responsibilities of the JSC. The primary purpose of the JSC will be to provide oversight and strategic planning for the Project being carried out under the Agreement. Specific JSC responsibilities shall include:

•Prioritization of activities in Project Plan (and between Project Plans if more than one is in place at any time);

•Resolving any issues that cannot be resolved by the Project Team, as provided in Section 4.1(d);

•Establishing a Commercialization Strategy, as provided in Section 6.1; and

•Recommending to the Party’s appropriate signatories the execution of any significant amendments or modifications to the Project Plan submitted to the JSC by the Project Team pursuant to Section 3.2, including any associated financial terms or modifications to the Payment Plan.

(b) JSC Meetings. The JSC will meet at least [**], or more or less frequently as mutually agreed by the Parties, at such times as may be agreed to by the Parties. The JSC will determine its meeting locations, and whether to conduct a meeting in-person, by teleconference, or videoconference. Each Party is responsible for all costs and expenses incurred by it in connection with its participation in the meetings of the JSC. Each Party shall have the right to call a special meeting of the JSC at any time as necessary or desirable to address disputes or other matters within the scope of the JSC’s responsibilities by providing the other Parties with written notice to that effect. The JSC Chairs shall schedule and convene such special JSC meeting as soon as practicable following such notice. Each Party may, from time-to-time and with prior written notice to the JSC members of the other Parties, invite Project Team members and/or others of its employees, consultants or agents to attend relevant portions of a JSC meeting as necessary. The Sponsoring Party shall notify the other Parties in writing in the event that it wishes to invite a Third Party to attend a JSC meeting. Any such notice shall be provided at least [**] business days prior to the relevant JSC meeting and shall identify the relevant Third Party and briefly describe the reasons that the Sponsoring Party wishes to include the Third Party in the meeting. The attendance and participation of such Third Party shall be subject to the prior written consent of the Parties receiving such notice (such consent not to be unreasonably withheld). Any such consent granted by a Party shall be conditioned upon the consultant or contractor being bound by a written confidentiality and non-use agreement that is reasonably acceptable to the consenting Party. In the event the Sponsoring Party requires the attendance of such Third Party at subsequent JSC meetings, approval shall not be required for any Third Party who was previously approved by the other Parties and remains bound by an appropriate written confidentiality and non-use agreement at the time of the Project Team meeting, provided that the Sponsoring Party gives the other Parties prior notice of such attendance and the other Parties do not revoke their consent. The Parties’ respective JSC Chairs (as defined below) shall be responsible for ensuring compliance with the foregoing.

(c) JSC Chairpersons. Meetings of the JSC shall be jointly chaired by one representative of each Party to be designated from among such Party’s appointed representatives to the JSC (each, a “JSC Chair”). A Party may change its designated JSC Chair by providing written notice to the other Party to that effect. The JSC Chairs will be responsible for establishing meeting schedules and agendas, and for generating mutually acceptable minutes of JSC meetings. Each Party’s JSC Chair can delegate such administrative aspects of JSC meetings to one of such Party’s members on the Project Team. The JSC Chairs may elect to rotate and/or otherwise allocate those responsibilities between themselves.

(d) JSC Decisions and Dispute Resolution. The JSC will make its decisions, and approve all of its actions, by unanimous consent of the JSC Chairs, provided that the Epizyme JSC Chair and the Eisai JSC Chair shall have one collective vote (which shall be settled solely between the Epizyme JSC Chair and the Eisai JSC Chair), and the RMS JSC Chair shall have one vote to resolve all JSC's decisions and approved

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actions. Except as otherwise set forth in this Agreement, if the JSC is unable to reach agreement on any matter within the JSC’s authority within [**] days after the matter is first referred to the JSC, then the matter will be resolved by the Parties’ Senior Officers pursuant to Section 4.3.

(e) Excluded JSC Decisions. Notwithstanding the foregoing decisions set forth in Section 4.2(d), the Parties agree that disputes on certain matters shall be excluded from resolution through the procedures of either Sections 3.2, 4.2(d) or 4.3, and that instead one Party(ies) (as indicated below) shall have final decision making authority with regard to such matters as follows:

•Pharmaceutical Partners shall have final decision making authority with respect to all matters related to (1) the development of the Pharmaceutical Partners Product (including without limitation to design and conduct clinical trials involving the Pharmaceutical Partners Product), and (2) the commercialization of the Pharmaceutical Partners Product in the Territory (including without limitation the decision of whether or not to sell or discontinue selling the Pharmaceutical Partners Product in a country or region). For clarity, the JSC shall not have any oversight or authority with respect to the development or commercialization of any Pharmaceutical Partners Products except and only to the extent related to the development of an RMS Product under a Project Plan.

•RMS shall have final decision making authority with respect to matters related to (1) the design and configuration of the RMS Product and (2) the commercialization of the RMS Product in the Territory other than in the Major Markets (including without limitation the decision, subject to Sections 6.2(c) and 6.2(d), of whether or not to sell or discontinue selling the RMS Product in a country or region other than in the Major Markets).

The Party having such final decision making authority may exercise that authority through the exercise of a casting vote by its JSC Chair on relevant subject matter, or through such other actions as it determines are necessary; provided, however, that if the Pharmaceutical Partners make any change to the Pharmaceutical Partners Product that results in a Change, then such Change shall be handled in accordance with Section 3.2.

4.3. Resolution of Disputes by Senior Officers. Except as otherwise expressly provided in Section 4.2(e), any unresolved disagreement or dispute arising at either the Project Team and/or the JSC will be referred to the Parties’ respective senior officers designated below (the “Senior Officers”), or their respective designees, for resolution through good faith negotiations over a period of up to [**] days. To the extent that a Party’s Senior Officer delegates his/her responsibility for resolution of a dispute to another officer of such Party, such Party shall ensure that the designee has all necessary and appropriate authority to fully resolve the Dispute on behalf of such Party. Such designated Senior Officers are as follows:

•For Epizyme: CEO and President

•For Eisai: President, Oncology Products Creation Unit

•For RMS: CEO and President

For matters referred to the Senior Officers, the Epizyme and Eisai representatives shall have one collective vote (which shall be settled solely between Epizyme and Eisai representatives), and the RMS representative shall have one vote to resolve the matter. For matters that are unable to be resolved in good faith by the Senior Officers within the [**] day period, any Party may submit such dispute to arbitration proceedings as set forth in Article 16.

5. DEVELOPMENT ACTIVITIES

5.1. Assay Development. RMS shall be responsible for and shall conduct the Assay Development as set forth in the Project Plan, including the Clinical Validation of the RMS Product.

5.2. Development of Pharmaceutical Partners Product. Epizyme, Eisai and/or their respective Affiliates are and shall remain responsible (at their own expense and as determined in their sole discretion) for the development and commercialization of the Pharmaceutical Partners Product. Pharmaceutical Partners will, upon request, provide RMS with access to its clinical trial protocols involving the Pharmaceutical Partners Product and Pharmaceutical

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Partners Information, if and to the extent such access is necessary to enable RMS to undertake and perform the Project Plan.

5.3. Access to Pharmaceutical Partners Protocols, Documentation, Clinical Samples and Other Samples. Subject to applicable law and regulations and any applicable existing contractual obligations, Pharmaceutical Partners will provide RMS with access or otherwise make available Clinical Samples to be used by RMS solely for the Clinical Validation to be performed under the Project Plan. This may include providing RMS with access to relevant data and information, including clinical trial protocols and data from clinical studies involving Pharmaceutical Partners Products, including screening data, patient stratification or data and results from testing of Clinical Samples performed for Pharmaceutical Partners by Third Party Agents, but excluding any testing of Clinical Samples performed for Pharmaceutical Partners by Third Party Agents with the RMS Product. Subject to Section 9.6, the Parties acknowledge and agree that Pharmaceutical Partners own all right, title and interest in and to the Pharmaceutical Partners’ Clinical Samples (to the extent such right title and interest is provided by the corresponding informed consent forms and is consistent with applicable laws and regulations) and the associated data (including the data identified above) provided by Pharmaceutical Partners pursuant to any Project Plan (collectively, the “Pharmaceutical Partners Patient Materials”). RMS acknowledges that Pharmaceutical Partners Patient Materials are Confidential Information as defined and described in Sections 2.17 and 13.1. Any specific applicable law, regulation or other contractual limitation on the use of the Pharmaceutical Partners Patient Materials beyond what is anticipated under the Project Plan must be provided to RMS in writing prior to the delivery of such Pharmaceutical Partners Patient Materials. Pharmaceutical Partners grant RMS the right to use Pharmaceutical Partners Patient Materials solely to the extent necessary to enable RMS to perform activities included in the Project Plan, including the right to include Pharmaceutical Partners Patient Materials in filings with any Regulatory Authority to the extent necessary for the use of the RMS Product with the Pharmaceutical Partners Product. For clarity, RMS shall not have the right to include, or to permit a Third Party to include, any Pharmaceutical Partners Patient Materials in any filings with any Regulatory Authority for any pharmaceutical product other than the Pharmaceutical Partners Product. In the event that the Parties determine that Samples from sources available to Pharmaceutical Partners are advantageous for the timely completion of the Assay Development, Pharmaceutical Partners shall use Commercially Reasonable Efforts to acquire and provide supplementary Samples. The cost of acquiring such supplementary Samples for the Assay Development will be the responsibility of Pharmaceutical Partners, Pharmaceutical Partners shall hold all right, title and interests in and to such supplementary Samples that are consistent with applicable laws and regulations, which Samples shall be Pharmaceutical Partners Patient Materials, and RMS shall [**].

5.4. Certification. Upon request, each Party shall provide the other Parties with a certification that any Samples provided by a Party pursuant to any Project Plan or used in a Project Plan were obtained under applicable law and with the appropriate consents, and that the use of such Samples by the Parties as outlined in the Project Plan are within such laws and consents.

5.5. Materials. Each Party may procure, at its own cost, Materials for the conduct of the Project. Such Materials shall be owned by the Party which procured the Materials. Each Party will use Materials of the other Party only for the purposes set forth in this Agreement and the Project Plan, and will not transfer or disclose such Materials to any Third Party, except in compliance with the Project Plan and any other applicable terms of this Agreement. Upon the procuring Party’s request, any remaining Materials will be disposed of according to the instructions of the procuring Party.

5.6. Access to RMS Protocols and Other Documentation. RMS will, upon request, provide the other Parties with reasonable access to documents and records in its or its Affiliates’ possession or control related to the RMS Product that are necessary or useful for the performance of the Project Plan, this Agreement or the development, manufacture, use or commercialization of the Pharmaceutical Partners Products. This shall include, without limitation, RMS providing Pharmaceutical Partners with reasonable access to information and documentation such as Assay Performance Data and technical reports regarding the RMS Product and related technology if and to the extent necessary to enable Pharmaceutical Partners to perform activities included in the Project Plan, including making submissions to and engaging in discussions with Regulatory Authorities to obtain Regulatory Approval of the Pharmaceutical Partners Product, and to develop, manufacture, use or commercialize the Pharmaceutical Partners Products.

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5.7. Third Party Testing Laboratory Services. The Parties anticipate using Third Party contract laboratories for the performance of certain Sample testing and/or other activities within the scope of the Project Plan (the “Contract Laboratories”). The selection and use of such Third Party contractors shall be managed in accordance with the terms of this Section 5.7.

(a) Chosen Contract Laboratories. The Parties will agree upon any Contract Laboratories used for the testing of Samples using the RMS Product and related laboratory services related to the Project Plan and this Agreement. For Assay Development, including Clinical Validation of the Assay or similar activities involving the RMS Product under the Project Plan, RMS and its Affiliates shall be responsible for initially identifying and for contracting with the Contract Laboratories. For any amendments to the Project Plan, including amendments to cover possible expansion into other countries for Major Markets, the Parties shall determine the appropriate Party(ies) to execute the relevant contract with the Contract Laboratories.

(b) RMS Product Manufacture and Supply. Except as otherwise expressly provided in the Project Plan, RMS or its Affiliates is solely responsible for the manufacture and supply of the RMS Product to the Contract Laboratories for Clinical Validation or other similar activities involving use of the RMS Product under the Project Plan.

(c) RMS Product Support. Should Epizyme and/or Eisai desire for any additional Contract Laboratory(ies) to be utilized for activities under the Project Plan, Pharmaceutical Partners shall be responsible (at its own expense) for contracting with such Contract Laboratory, and all expenses for the testing of Samples and Contract Laboratory staff training required for using a RMS Product hereunder. RMS will be responsible for providing training, support and any software upgrades to the Contract Laboratories to perform Clinical Validation or other similar activities involving use of the RMS Product under the Project Plan. RMS shall also be responsible for ensuring that each such Contract Laboratory has or is provided the necessary equipment (including any RMS Technology and any necessary upgrades) needed to perform the RMS Product, which equipment shall be provided on terms to be agreed upon between RMS and the Contract Laboratories; provided that such terms will be consistent with the standard terms currently being offered by RMS to its other Third Party customers for such equipment (the “Standard Terms”). For clarity, the cost for any training, support, software update and equipment (including any upgrades) provided by RMS to the Contract Laboratories (the “Support”) will be paid by the Contract Laboratories and the amount shall be consistent with the Standard Terms. If a Contract Laboratory is not willing to enter into an agreement with RMS based on the Standard Terms, or if a Contract Laboratory does not fully pay for such Support according to the Standard Terms, RMS shall not be obliged under this Agreement or the Project Plan to provide Support to such Contract Laboratory.

5.8. Applications for Regulatory Approval. Pharmaceutical Partners and RMS will discuss and together determine the regulatory strategy/activities to be undertaken with the FDA and other relevant Regulatory Authorities in the Major Markets in connection with the development of any RMS Product pursuant to the Agreement. RMS agrees to work in good faith with the Pharmaceutical Partners to identify the regulatory strategy/activities to be undertaken with relevant Regulatory Authorities in other countries where the Pharmaceutical Partners are intending to commercialize the Pharmaceutical Partners Product beyond those countries in the Major Markets.

(a) Approval for Pharmaceutical Partners Product in Major Markets. Pharmaceutical Partners shall, at their own expense, (i) be responsible for and control the preparation and submission of any applications for Regulatory Approval, and (ii) obtain and maintain Regulatory Approvals, in the Territory for any Pharmaceutical Partners Product. With respect to any Pharmaceutical Partners Product in Major Markets, Epizyme and Eisai will be responsible for

•preparing and filing any regulatory submissions;

•soliciting RMS’ input for scheduled meetings with Regulatory Authorities solely to the extent such meetings concern regulatory submissions that involve discussion of the RMS Product;

•providing RMS with the opportunity to participate in scheduled meetings of the FDA’s CBER/CDER or other Regulatory Authorities (at RMS’ sole expense) solely to the extent such meetings concern such regulatory submissions that involve discussion of the RMS Product; and

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•obtaining and maintaining any Regulatory Approvals in the Major Markets with respect thereto.

All final decisions regarding content of regulatory submissions, discussions and communications with regulatory authorities on the Pharmaceutical Partners Product shall be solely with Pharmaceutical Partners.

(b) Approval for RMS Products in Major Markets. RMS or its Affiliates shall, at their own expense, (i) be responsible for and control the preparation and submission of any applications for Regulatory Approval, and (ii) obtain and maintain Regulatory Approvals, in each case, in the Territory for any RMS Product. For the Major Markets specified in the Project Plan and with respect to any RMS Products, RMS will be responsible for and use Commercially Reasonable Efforts to pursue:

•preparing any regulatory submissions related to any RMS Product that are being developed pursuant to the Agreement;

•soliciting and obtaining Epizyme’s and Eisai’s written approval of any such regulatory submission, to the extent such regulatory submission contains discussion of the Pharmaceutical Partners Product or the Clinical Patient Data;

•filing any such regulatory submissions with the appropriate Regulatory Authority;

•soliciting Epizyme’s and Eisai’s input for scheduled meetings with Regulatory Authorities to the extent such meetings involve discussion of the Pharmaceutical Partners Product or the Clinical Patient Data;

•at Epizyme and Eisai’s request, participating in scheduled meetings of the FDA’s CBER/CDER or other Regulatory Authorities regarding development of the Pharmaceutical Partners Product for use with the RMS Product in Major Markets;

•providing Epizyme and Eisai with the opportunity to participate in scheduled meetings with FDA’s CDRH or other Regulatory Authorities (at Pharmaceutical Partners’ sole expense) to the extent such meetings concern such regulatory submissions that involve discussion of the Pharmaceutical Partners Product or the Clinical Patient Data;

•obtaining and maintaining any Regulatory Approvals in the Major Markets with respect to the RMS Product; and

•supporting any efforts of the Pharmaceutical Partners to obtain Regulatory Approvals for the Pharmaceutical Partners Products for use with the RMS Product in the Major Markets.

Excluding decisions related to regulatory submissions containing the Clinical Patient Data, all final decisions regarding content of regulatory submissions, discussions and communications with Regulatory Authorities concerning the RMS Product shall be solely with RMS; provided that, RMS shall give reasonable consideration to all input given by Pharmaceutical Partners as set forth above, including, time permitting, providing final copies of the clinical study report (CSR), labeling and the analytical sections of such regulatory submissions for Pharmaceutical Partners review and input prior to filing such submission.

(c) Approval for Countries Outside Major Markets. For countries outside the Major Markets that Pharmaceutical Partners do not wish to include in the Major Markets under this Agreement but where RMS nonetheless desires to commercialize the RMS Product, Pharmaceutical Partners agree to reasonably cooperate in the preparation and/or exchange of any documentation necessary to support any INDs, NDAs, Device Authorization Applications or other applications for such Regulatory Approvals in such countries. For countries outside the Major Markets that RMS does not wish to include in the Major Markets under this Agreement but where Pharmaceutical Partners desire to commercialize the Pharmaceutical Partners Product, RMS agrees to reasonably cooperate in the preparation and/or exchange of any documentation necessary to support any INDs, NDAs, Device Authorization Applications or other applications for such Regulatory Approvals for an IVD in such countries. For clarity, RMS’ cooperation for preparation and/or exchange of documentation to support any Device Authorization Applications or other applications for such Regulatory Approvals for an IVD in such countries does not impart nor grant any implied licenses with respect to the RMS Product or to any RMS Background IP or RMS Project Invention for such IVD in the Diagnostic Field.

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5.9. Pricing and Reimbursement.Subject to Section 6.2(c), RMS will be responsible for pricing and reimbursement of RMS Products in line with market conditions and in accordance with RMS’ global pricing strategies. The Parties will discuss and agree upon a joint strategy to work with Third Party payors to establish the value of the RMS Product, for such Third Party payors, in the Major Markets. RMS agrees to use Commercially Reasonable Efforts to establish the value of the RMS Product, on a country-by-country basis in the Major Markets, consistent with similar IVD products commercialized by RMS in such country in the Major Markets.

5.10. Reports. Each Party will keep the other Party informed of its progress and results in performing the Project Plan under this Agreement. This shall include, without limitation: (i) the exchange of information and communication of results under the Project Plan at each Project Team meeting, and (ii) the Project Team providing the JSC with an annual summary of the activities performed and results achieved in connection with the Project Plan. For clarity, the foregoing shall not be construed as obligating Pharmaceutical Partners to provide RMS, the JSC or any Project Team with any data, information or status reports related to the development of the Pharmaceutical Partners Product.

5.11. Records. Each Party shall, and shall ensure that its Affiliates and any Third Party Agents performing activities hereunder or under the Project Plan, maintain records in sufficient detail and in good scientific manner appropriate for patent and regulatory purposes, and in compliance with all applicable laws and regulations, which shall be complete and accurate and shall properly reflect all work done and results achieved in the performance of its designated activities hereunder and under the Project Plan and which shall record only such activities andshall not include or be commingled with records of activities outside the scope of this Agreement. Such records shall be retained by the applicable Party for at least [**] years after termination of this Agreement, or for such longer period as may be required by applicable laws and regulations. RMS shall make available to Pharmaceutical Partners all records held by RMS with respect to Clinical Patient Data and Target Know-How.

5.12. Licenses and Access to Third Party Technology. Each Party shall ensure their freedom to operate for the development, manufacture, use or commercialization of their respective product(s).

(a) Third Party Technology. RMS and/or its Affiliates shall be solely responsible (at its own expense) for obtaining and maintaining any licenses or other rights to access and/or use any Third Party technology, patents or other intellectual property rights that are necessary to ensure that the development, manufacture, use or commercialization of the RMS Technology or the RMS Product (but not the Pharmaceutical Partners Product) does not directly infringe such Third Party intellectual property rights. Epizyme, Eisai and/or their Affiliates shall be solely responsible (at its or their own expense) for obtaining and maintaining any licenses or other rights to access or use any Third Party technology, patents or other intellectual property rights that are necessary to ensure that the development, manufacture, use or commercialization of the Pharmaceutical Partners Product (but not the RMS Technology or the RMS Product) does not directly infringe such Third Party intellectual property. Acquisition of such Third Party intellectual property rights is at the sole discretion of RMS and its Affiliates for any Third Party intellectual property on the RMS Technology or the RMS Product (but not the Pharmaceutical Partners Product) and at the sole discretion of Epizyme, Eisai and/or their Affiliates for any Third Party intellectual property on the Pharmaceutical Partners Product (but not the RMS Technology or the RMS Product). Financial obligations with respect to any licenses or rights to access and/or use Third Party technology, patents or other intellectual property that are necessary for the development, manufacture, use or commercialization of the RMS Product and/or the Pharmaceutical Partners Product that are Controlled by a Party as of the Effective Date shall be the responsibility of, and shall be borne by, the Party Controlling such intellectual property. If any other licenses or rights to access and/or use Third Party technology, patents or other intellectual property are necessary for the development, manufacture, use or commercialization of both the RMS Product and the Pharmaceutical Partners Product, upon agreement of the Parties to obtain such licenses, the Parties shall agree on the process and associated financials for obtaining and maintaining rights under such Third Party intellectual property and shall enter into an appropriate license agreement with the applicable Third Party; provided that: (i) [**], and shall [**] such Third Party agreement(s) and [**], (ii) the Parties shall [**] any such Third Party agreement and [**], (iii) [**], and shall [**] such Third Party agreement [**], whether for [**] or not, and (iv) [**] shall be shared as agreed in good faith by the Parties.

(b) No Representations. Except as otherwise provided herein, no Party makes any representation or warranty of any kind with respect to the intellectual property (including Background IP and/or Project

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Inventions, or to any data developed under the Project Plan, including Assay Performance Data or Clinical Patient Data) that is licensed, supplied or otherwise made available to the other Party under this Agreement, including without limitation any warranties of Patent availability, enforceability and/or non-infringement.

6. COMMERCIALIZATION AND USE OF TRADEMARKS

6.1. Commercialization Strategy. The commercial organizations of RMS, Epizyme, and Eisai shall work jointly, [**] to determine a joint marketing strategy and plan to align priorities and activities for launch of the RMS Product and subsequent commercialization of the RMS Product in the Major Markets for use with the Pharmaceutical Partners Product (the “Commercialization Strategy”). The Parties shall use Commercially Reasonable Efforts to collaborate on joint promotional efforts as set forth in the Commercialization Strategy.

6.2. RMS Obligations. RMS shall use Commercially Reasonable Efforts to commercialize and make available the RMS Product, and to perform its responsibilities under the Project Plan and in accordance with the Commercialization Strategy. Without limiting the foregoing, if the RMS Product has received a Regulatory Approvalfrom the local Regulatory Authority in a country in the Major Markets, RMS and its Affiliates will be responsible for commercialization of, and shall use Commercially Reasonable Efforts to commercialize, any RMS Product in such country in accordance with the Project Plan and in accordance with the Commercialization Strategy. Also, without limiting the foregoing, in any country in the Major Markets and in the event the labeling for the Pharmaceutical Partners Product requires that an IVD be administered to a potential patient prior to a physician prescribing such Pharmaceutical Partners Product, RMS will use Commercially Reasonable Efforts to commercialize and/or make available to health care providers the RMS Product either before or at the same time such Pharmaceutical Partners Product is commercialized in said Major Markets, to the extent commercially reasonable and in compliance with all applicable laws. RMS shall undertake its obligations under this Section 6.2 in good faith with the Pharmaceutical Partners.

(a) As outlined in the Commercialization Strategy, RMS will ensure the availability of the RMS Product for use by health care providers for use in connection with the initiation and ongoing treatment of patients with the Pharmaceutical Partners Product in the Major Markets.

(b) RMS shall provide adequate training and update its software in a timely manner in each of the Major Markets in order to ensure that the RMS Product is accessible in each of the Major Markets.

(c) RMS shall use Commercially Reasonable Efforts to obtain governmental and other Third Party payor pricing and reimbursement approvals for the RMS Product in each of the countries in the Major Markets.

(d) From time to time, Pharmaceutical Partners may request that the Major Markets be expanded to include additional countries or regions as specified in Section 3.5 above.

6.3.Where RMS elects to discontinue selling the RMS Product in a country within the Major Markets and such discontinuation is not due to a change in Regulatory Approvals for the RMS Product or other event that would make the sale of the RMS Product no longer in compliance with applicable laws and regulations, RMS shall provide the Pharmaceutical Partners with at least [**] months’ prior notice via the JSC. Following the effective date of such notification, the affected country shall be excluded from the Major Markets and RMS shall procure alternate channels of distribution and make available or procure the making available of the RMS Product in such quantities and upon commercially reasonable terms, in each case as necessary to reasonably enable Pharmaceutical Partners to market the Pharmaceutical Partners Product in conjunction with the RMS Product in such country. As to each country that is excluded from the Major Markets as set forth in this Section 6.2(d), RMS shall enable such continued distribution and marketing beginning prior to discontinuation of the supply of RMS Product in such country and to ensure continuity of supply following such discontinuation.

6.4.Trademarks

If a Party owns a Trademark and another Party plans to use said Trademark to market or sell the Pharmaceutical Partners Product in conjunction with the RMS Product ("Owned Trademark") as intended under this Agreement, the marketing Party proposing the use of the Owned Trademark held by another Party shall give the JSC written notice of its intended use of such Owned Trademark, at least [**] months prior to notifying any Regulatory

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Authority of such intended use. The JSC shall either approve of such intended use or reasonably object to its use in writing, within [**] days of the marketing Party's written notice. If the JSC objects to the use of such Owned Trademark, the matter will be resolved using the dispute resolution procedures of this Agreement. If the JSC approves to the use of such Owned Trademark, the Party Controlling such Owned Trademark shall grant to the other Parties and its Affiliates, as applicable, a non-exclusive, non-assignable, non-transferable, royalty-free right and license to use the Owned Trademark as permitted by the JSC. Such non-owning Party shall not acquire any intellectual property ownership rights in the Owned Trademark and shall agree not to take any action that is likely to harm the goodwill that the owning Party has acquired in the Owned Trademarks or that would otherwise tarnish the reputation of the owning Party or such Owned Trademarks.

(b) No Party shall propose using a Trademark for a Pharmaceutical Partners Product or a RMS Product that is confusingly similar to an existing Trademark owned by another Party, or likely to be associated with another Trademark for a corresponding RMS Product or Pharmaceutical Partners Product, without the prior written consent of the owner of the existing Trademark.

(c) If a Party uses the Owned Trademark of another Party in its advertisement, such advertisement shall contain a clear indication of ownership of such Owned Trademark.

(d) RMS shall own all right, title and interest in and to Trademarks for the RMS Product developed by RMS as of the Effective Date and during the Term.

(e) Epizyme and Eisai shall own all right title and interest in and to Trademarks for the Pharmaceutical Partners Products developed by Epizyme or Eisai as of the Effective Date and during the Term.

(f) Upon any termination of this Agreement, the Trademark licenses provided for in Section 6.3(a) shall terminate, except so far as may be necessary to cover any existing or continuing rights and licenses as set forth in Section 15.7(d).

6.5. Sales and Marketing Materials. Each Party shall provide the other Party/Parties (i.e., RMS on the one hand and the Pharmaceutical Partners on the other) with that portion of its sales and marketing materials (including any internet information pages), which contain references to the other Party’s product or the other Party’s Trademarks (i.e., in the case of Pharmaceutical Partners, the RMS Product and/or RMS’ Trademark for the RMS Product and, in the case of RMS, the Pharmaceutical Partners Product and/or Pharmaceutical Partners’ Trademark for the Pharmaceutical Partners Product), at least [**] business days prior to the printing of such materials for distribution to the public; provided that, once a particular reference, specific use and detailed wording and look of the other Party’s Trademarks has been reviewed and approved in accordance with this Section 6.5, it may be used in subsequent materials without being submitted for further review. In the event that the other Party has a reasonable objection to the content of such sales and marketing materials (such as inaccurate labeling, misuse of Trademarks, other factual content, and the like), the marketing Party shall submit the materials to the JSC, which will review and decide the dispute within [**] days, during which time the materials shall not be disseminated to the public. In the event that the JSC does not resolve the dispute within [**] days, such dispute shall be decided in accordance with the dispute resolution procedures of this Agreement.

7. CONSIDERATION

7.1. Consideration. In consideration for the work to be performed by RMS under the Project Plan and the relevant licenses and other rights granted to Pharmaceutical Partners hereunder, Pharmaceutical Partners shall compensate RMS for the amounts set forth in the Payment Plan. The Payment Plan is attached hereto as Exhibit B. The Payment Plan shall be binding upon the Parties, unless the Payment Plan requires modifications due to Changes as set forth in Section 3.2, in which case the Parties shall proceed as set forth in Sections 3.2 and, if applicable, 4.2(d). RMS will not be obligated to undertake work on activities that are not included in this Agreement or the agreed Project Plan and Payment Plan until such time as the Parties have agreed in writing to include such activities and the related costs and expenses in the Project Plan and the Payment Plan. Except as set forth in this Agreement and in the Project Plan, each Party will bear their own costs and expenses with respect to this Agreement.

7.2. Invoices and Payments. The Parties have agreed on a schedule of payments to be made by Pharmaceutical Partners to RMS as set forth in the Payment Plan upon completion of specific activities as defined in the Project Plan. Pharmaceutical Partners will make payments to RMS of any amounts due and payable according to

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such payment schedule, or as specified in Section 7.1 above, pursuant to invoices to be provided by RMS within [**] days following the receipt of a proper invoice, which shall be issued following the completion of the specific activities referenced in the Project Plan to be completed with respect to such payment (the “Due Date”). All payments shall be invoiced and made in U.S. dollars by bank wire transfer of immediately available funds to such bank account in the United States as may be designated in writing by RMS.

7.3. Late Payments. If Pharmaceutical Partners fails to pay any undisputed amount specified in this Agreement on or before the Due Date thereof, the amount owed will bear interest [**] from the Due Date until paid, provided, however, that if this interest rate is held to be unlawful or unenforceable for any reason, the interest rate will be the lesser of the interest rate provided above, or the maximum rate allowed by law at the time payment is due.

7.4. Taxes. To the extent that the goods or services to be provided by one Party to another Party hereunder are subject to any sales, use, rental, personal property, value added, or any other similar taxes (but for clarity not income or other similar taxes), payment of said taxes is the responsibility of the Party receiving such goods or services, subject to any applicable exemption entitlements. Receiving party will not be invoiced for sales or use taxes for which it is exempt as long as it maintains a valid exemption certificate and provides it to the supplying party.For the avoidance of doubt, Pharmaceutical Partners shall not have any responsibility or liability for any such taxes that may be payable with respect to goods or services provided by RMS to Third Parties under the Project.

8. INTELLECTUAL PROPERTY AND OTHER PROPERTY

8.1. Ownership or Control of Background IP. The Party’s acknowledge that each Party either owns all rights, title, and interest in and to, or Controls its respective Background IP. The Parties acknowledge and agree that, except for the license expressly set forth in Sections 9.1 and 9.2 below, neither Party shall have any rights to, or licenses under, the other Party’s Background IP.

8.2. Ownership of Assay Performance Data. RMS shall own all Assay Performance Data. For the avoidance of doubt, RMS may use, disclose or transfer the Assay Performance Data at its sole discretion, provided, however, that any transfer of the Assay Performance Data shall not impair the rights granted to Pharmaceutical Partners in the Assay Performance Data as provided in this Agreement.

8.3. Ownership of Clinical Patient Data. Epizyme and Eisai shall own all Clinical Patient Data.

8.4. Ownership of Samples. All rights, title and interest in and to all Samples that Epizyme and/or Eisai provides to RMS under this Agreement for the Project Plan, including Clinical Samples, shall remain the property of Pharmaceutical Partners to the extent consistent with the applicable informed consent forms and applicable laws and regulations. All rights, title and interest in and to all Samples that RMS provides and/or makes available under the Project Plan, including Samples that RMS already owns or later acquires, shall remain or be the property of RMS to the extent consistent with the applicable informed consent forms and applicable laws and regulations. Notwithstanding the foregoing, RMS shall not use any Samples provided or obtained by Pharmaceutical Partners under the Project Plan for any development, testing, validation or other activities with respect to any product other than activities with respect to the RMS Product for use with the Pharmaceutical Partners Product as specified in the Project Plan.

8.5. Ownership of Project Inventions. The Parties shall promptly notify each other through the delivery of a detailed invention disclosure in confidence of any Project Inventions, including Target Know-How. Ownership of Project Inventions shall be determined by the following provisions:

•Project Inventions primarily relating to the Pharmaceutical Partners Product (or the manufacture or use thereof), and any improvements to Pharmaceutical Partners Background IP created by any Party(ies) under or in connection with this Agreement, but excluding Target Know-How, shall be deemed “Pharmaceutical Partners Project Invention” and all right title and interest in and to such Pharmaceutical Partners Project Inventions shall be owned by Epizyme and Eisai;

•Project Inventions primarily relating to the RMS Product (or the manufacture or use thereof), and any improvements to RMS Background IP created by any Party(ies) pursuant to this Agreement,

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but excluding Target Know-How, shall be deemed “RMS Project Invention” and all right title and interest in and to such RMS Project Inventions shall be solely owned by RMS; and

•All other Project Inventions (regardless of inventorship), including Target Know-How, shall be jointly owned by the Parties (“Joint Inventions”) provided that such joint ownership interest shall be an equal fifty percent (50%) ownership interest held by each of Pharmaceutical Partners and RMS, respectively.

8.6. Disclosure of Data. RMS shall promptly provide to Pharmaceutical Partners copies of or access to all Clinical Patient Data held by RMS, and all related supporting documentation, information, results, analyses with respect to RMS’ activities under the Project Plan, when and as such Clinical Patient Data or supporting documentation or other information becomes available.

8.7. Assignment and Prosecution of Project Inventions. Where applicable under Section 8.5, the Parties agree to and do hereby assign any and all right, title, and interest in such Project Inventions to the other Party, or to both Parties in the case of Joint Inventions. The Parties agree (and agree to cause their Affiliates), upon request by another Party and at such other Party’s cost and expense, to promptly execute any and all documents deemed necessary or appropriate by the other Party (and/or their Affiliates) to memorialize, effect or perfect the assignments under this Section 8.7 throughout the world. Epizyme and Eisai shall be responsible for the prosecution and maintenance of any Patent applications and Patents claiming or covering any Pharmaceutical Partners Project Invention. RMS shall be responsible for the prosecution and maintenance of any Patent applications and Patents claiming or covering any RMS Project Invention. Each Party will reasonably consider any request by the other Party(ies) to support any patent applications related to Project Inventions owned by the requesting Party. The Parties agree that the Parties set forth below shall be responsible for the prosecution and maintenance of any Joint Inventions (the “Joint Patents”): (a) for any Joint Inventions solely related to Project Inventions in the Pharmaceutical Field, the Parties agree that Pharmaceutical Partners shall be responsible for such Joint Patents; (b) for any Joint Inventions solely related to Project Inventions in the Diagnostic Field, the Parties agree that RMS shall be responsible for such Joint Patents; and (c) for any Joint Inventions that relate to Project Inventions that may have application in both the Pharmaceutical Field and Diagnostic Field, the Parties agree that Pharmaceutical Partners shall be responsible for such Joint Patents. For Joint Patents that Pharmaceutical Partners are responsible for the prosecution and maintenance, RMS shall (and shall cause their Affiliates to) reasonably cooperate with Pharmaceutical Partners in connection with the same, including without limitation, upon the request of Pharmaceutical Partners, (w) promptly executing any and all Patent applications, formal documents, assignments, or other instruments which Pharmaceutical Partners deem necessary or reasonably useful for the filing, prosecution, maintenance, enforcement and/or defense of any Patent applications or Patents claiming or covering any such Joint Inventions, which may be filed or prepared at Pharmaceutical Partners’ cost and expense, and (x) providing copies of or access to such supporting documentation, information, results, and analyses with respect to such Project Invention as is necessary for the filing, prosecution, maintenance, enforcement and/or defense of any Patent applications or Patents claiming or covering any such Joint Inventions. Pharmaceutical Partners shall keep RMS reasonably informed of prosecution activities with respect to the Patent applications for such Joint Patents. Pharmaceutical Partners shall provide RMS with a copy of material communications from any patent authority regarding such Joint Inventions, and shall provide drafts of any material filings or responses to be made to such patent authorities a reasonable amount of time in advance of submitting such filings or responses so that RMS may have an opportunity to review and comment. If Pharmaceutical Partners abandon, cease prosecution or do not maintain any such Joint Patent anywhere in the world, then Pharmaceutical Partners shall provide RMS written notice of at least [**] days prior to any deadline for taking action to avoid abandonment (or other loss of rights) and RMS shall have the right, in RMS’ sole discretion, to file for or continue prosecution and/or maintenance of such Joint Patent at its own expense. If RMS elects to assume responsibility for the filing, prosecution and/or maintenance of a Joint Patent abandoned by the Pharmaceutical Partners, then upon RMS’ request, the Pharmaceutical Partners shall assign to RMS all Pharmaceutical Partners’ right, title and interest in and to such Joint Patents, and shall execute such documents necessary to evidence such assignment. In the event of any assignment of right, title and interest in and to such Joint Patents abandoned by the Pharmaceutical Partners and assumed by RMS, RMS shall, and hereby does, grant to Pharmaceutical Partners (i) an exclusive, perpetual, irrevocable, fully paid-up and sublicensable license in the Territory in the Pharmaceutical Field, (ii) a non-exclusive, perpetual, irrevocable, fully paid-up and sublicensable license in the Territory in the Diagnostic Field and (iii) a non-exclusive, perpetual, irrevocable, fully paid-up and sublicensable license in the Territory for all other uses, in each case, to any and all such interest in such Joint Patents. For Joint Patents that RMS is responsible for the prosecution and maintenance, Pharmaceutical Partners shall (and

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shall cause their Affiliates to) reasonably cooperate with RMS in connection with the same, including without limitation, upon the request of RMS, (y) promptly executing any and all Patent applications, formal documents, assignments, or other instruments which RMS deems necessary or reasonably useful for the filing, prosecution, maintenance, enforcement and/or defense of any Patent applications or Patents claiming or covering any such Joint Inventions, which may be filed or prepared at RMS’ cost and expense, and (z) providing copies of or access to such supporting documentation, information, results, and analyses with respect to such Project Invention as is necessary for the filing, prosecution, maintenance, enforcement and/or defense of any Patent applications or Patents claiming or covering any such Joint Inventions. RMS shall keep Pharmaceutical Partners reasonably informed of prosecution activities with respect to the Patent applications for such Joint Patents. RMS shall provide Pharmaceutical Partners with a copy of material communications from any patent authority regarding such Joint Inventions, and shall provide drafts of any material filings or responses to be made to such patent authorities a reasonable amount of time in advance of submitting such filings or responses so that the Pharmaceutical Partners may have an opportunity to review and comment. If RMS abandons, ceases prosecution or does not maintain any such Joint Patents anywhere in the world, then RMS shall provide Pharmaceutical Partners written notice of at least [**] days prior to any deadline for taking action to avoid abandonment (or other loss of rights) and the Pharmaceutical Partners shall have the right, in the Pharmaceutical Partners’ sole discretion, to file for or continue prosecution and/or maintenance of such Joint Patent at their own expense. If the Pharmaceutical Partners elect to assume responsibility for the filing, prosecution and/or maintenance of a Joint Patent abandoned by RMS, then upon Pharmaceutical Partners’ request, RMS shall assign to Pharmaceutical Partners all RMS’ right, title and interest in and to such Joint Patents, and shall execute such documents necessary to evidence such assignment. In the event of any assignment of right, title and interest in and to such Joint Patents abandoned by RMS and assumed by the Pharmaceutical Partners, Pharmaceutical Partners shall, and hereby do, grant to RMS a non-exclusive, perpetual, irrevocable, fully paid-up and sublicensable license in the Territory in the Diagnostic Field and for all other uses in the Territory outside the Pharmaceutical Field, in each case, to any and all such interest in such Joint Patents.

8.8. Third Party Agents. To the extent that a Party utilizes Third Party Agents to perform Project Plan activities, such Party shall ensure that such Third Party contractors are obligated to assign rights to any Project Inventions that are made by such Third Party Agents so that such rights can be conveyed in accordance with the terms and conditions of Sections 8.5 and 8.7.

8.9. Defense and Enforcement. Each Party shall promptly notify the other Parties in the event it becomes aware of any Third Party activities that may constitute infringement of any Patents that are subject to this Agreement, and/or of any Third Party claims or allegations contesting the validity and/or enforceability of any such Patents. With respect to any Joint Patents, the Parties will promptly thereafter consult and cooperate to determine a course of action, which may include, without limitation, the commencement of legal action by any or all of Epizyme, Eisai and RMS, to terminate or otherwise address such infringement, misappropriation or misuse, and/or to defend the Joint Patents.Responsibility and control over any actions to defend and/or enforce Patents under this Agreement shall be allocated between the Parties in accordance with the terms of this Section 8.9.

(a) Background Patents and Patents Claiming Inventions. RMS shall have the right, but no obligation, to control, enforce, and defend worldwide, at its own expense, the Patents in RMS Background IP and any Patents claiming RMS Project Invention. Epizyme and Eisai shall have the right, but no obligation, to control, enforce, and defend worldwide, at its own expense, the Patents in Pharmaceutical Partners Background IP and any Patents claiming Pharmaceutical Partners Project Invention.

(b) Responsibility for Joint Patents. Epizyme, Eisai and RMS are entitled, but have no obligation, to control any legal proceedings or other actions to enforce and/or defend the Joint Patents worldwide, at the expense of the Party that desires to control, enforce or defend (the “Acting Party”). If more than one Party desires to be the Acting Party, the Parties shall negotiate in good faith about who should be in control. The Parties that are not controlling, enforcing or defending the applicable Joint Patent(s) (“Supporting Parties”) are entitled, at their own expense, to be represented in any such enforcement or defense by counsel of their own choice. If the Acting Party is unable to initiate or prosecute the action solely in its own name, the Supporting Parties will, upon request, join the action and/or execute all documents reasonably necessary for the Acting Party to initiate, prosecute and maintain the action. The Supporting Parties shall have the right to consult with the Acting Party to participate in decisions regarding the appropriate course of conduct for such action, and the additional right to join and participate in (but not control) such action. Each Party shall have the right to be represented by legal counsel of its own choice in connection with any legal proceedings or

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other actions undertaken by another Party pursuant to this Section 8.9(b) to defend or enforce the Joint Patents.

(c) Cooperation. The Supporting Parties shall, upon request, reasonably assist and cooperate with the efforts of the Acting Party, including without limitation by providing copies of or access to supporting documentation, information, results, and analyses with respect to Project Inventions as is necessary for the defense and/or enforcement of any Joint Patent. The Acting Party shall keep the Supporting Party informed of any developments in the action.

(d) Settlements. The Acting Party shall have the right to settle the relevant claim or actions; provided, however, that the Acting Party shall not, without the prior written consent of the Supporting Parties, enter into any settlement, consent judgment or other voluntary final disposition of any claim or action that would: (i) subject any Supporting Party or its Affiliates to an injunction or otherwise adversely impact any of the Supporting Party’s rights under this Agreement; (ii) impose any financial obligation upon any Supporting Party or its Affiliates; and/or (iii) constitute an admission of guilt or wrongdoing by any Supporting Party or its Affiliates.

(e) Recoveries. Any recovery of damages or other compensation received by a Party in connection with a claim or action involving the Joint Patents will be first applied towards the reimbursement of the Parties’ documented out-of-pocket costs and expenses associated with such claim (including reasonable attorneys’ fees, expert witness fees, court costs and other litigation costs and expenses). Any and all remaining amounts will then be allocated between the Parties on a pro rata basis as determined based upon the relative economic losses suffered by each Party.

8.10.Patent Term Restoration. The Parties agree to cooperate and to take reasonable actions to maximize the protections available under the safe harbor provisions of 35 U.S.C. 103(c) for United States patents and patent applications. The Parties shall cooperate with each other, including without limitation to provide necessary information and assistance as another Party may reasonably request, in obtaining patent term restoration or supplemental protection certificates or their equivalents in any country in the Territory where applicable to the Joint Patents and any other Patents claiming Project Inventions.

9. LICENSES

All licenses granted in Sections 9.1 to 9.8 below are royalty free and fully paid-up and are subject to Section 9.10.

9.1. License to Pharmaceutical Partners’ Background IP. Epizyme and Eisai hereby grant RMS a non-exclusive, license in the Territory under Pharmaceutical Partners’ Background IP for the sole and limited purpose of, and only to the extent required to, research, develop, obtain Regulatory Approval for, make, have made, use, sell, offer for sale, import, export, and commercialize the RMS Product in the Diagnostic Field. The license granted in this Section 9.1 is not sublicensable, except to any of RMS’ Affiliates or any Third Party that is developing, obtaining Regulatory Approval for, manufacturing or selling the RMS Product on behalf of RMS.

9.2. License to RMS’ Background IP. RMS hereby grants to Epizyme and Eisai a non-exclusive, license in the Territory under RMS’ Background IP for the sole and limited purpose of, and only to the extent required to, research, develop, obtain Regulatory Approval for, make, have made, use, sell, offer for sale, import, export and commercialize the Pharmaceutical Partners Product in conjunction with the RMS Product in the Pharmaceutical Field; provided, however, that such licenses shall not include any rights under the [**]. The license granted in this Section 9.2 is not sublicensable except to any of Pharmaceutical Partners’ Affiliates or licensees or any Third Party that is developing, obtaining Regulatory Approval for, manufacturing or selling the Pharmaceutical Partners Product on behalf of or under license from Epizyme and/or Eisai.

9.3. License to Pharmaceutical Partners Project Invention. Epizyme and Eisai hereby grant RMS a non-exclusive license in the Territory to any and all the Pharmaceutical Partners Project Inventions solely owned by Pharmaceutical Partners for the limited purpose of, and to the extent required to, research, develop, obtain Regulatory Approval for, make, have made, use, sell, offer for sale, import, export and commercialize the RMS Product in the Diagnostic Field. The licenses granted in this Section 9.3 are not sublicensable, except to any of RMS’ Affiliates or

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any Third Party that is developing, obtaining Regulatory Approval for, manufacturing or selling the RMS Product on behalf of RMS.

9.4. License to RMS Project Invention. RMS hereby grants to Pharmaceutical Partners a non-exclusive license in the Territory to any and all the RMS Project Inventions solely owned by RMS for the limited purpose of, and to the extent required to, research, develop, obtain Regulatory Approval for, make, have made, use, sell, offer for sale, import, export and commercialize the Pharmaceutical Partners Product in the Pharmaceutical Field. The license granted in this Section 9.4 is not sublicensable, except to any of Pharmaceutical Partners’ Affiliates, licensees and Third Party Agents that are developing, obtaining Regulatory Approval for, manufacturing or selling the Pharmaceutical Partners Product on behalf of or under license from Pharmaceutical Partners.

9.5. Licenses to Joint Inventions. Pharmaceutical Partners shall, and hereby do, grant to RMS an exclusive license in the Territory in the Diagnostic Field to any and all Pharmaceutical Partners’ interest in Joint Inventions. RMS shall, and hereby does, grant to Pharmaceutical Partners an exclusive license in the Territory in the Pharmaceutical Field to any and all RMS’ interest in Joint Inventions. In addition, RMS shall, and hereby does, grant back to Pharmaceutical Partners a non-exclusive license in the Territory in the Diagnostic Field to any and all RMS’s interest in Joint Inventions. The foregoing licenses granted in this Section 9.5 shall be fully sublicensable. For any use outside the Diagnostic Field and Pharmaceutical Field and in order to avoid any unanticipated limitation on the Parties’ ability to use and exploit Joint Inventions, where and when necessary as required by law, each Party hereby grants to the other Party and its respective Affiliates, an equal, undivided interest in and to the Joint Inventions, such that each Party shall be entitled to freely exploit the Joint Inventions outside such fields, including the ability to grant sublicenses, as each Party sees fit and without the need for subsequent permission from or accounting to the other Party.

9.6. License to Clinical Patient Data. Epizyme and Eisai shall give RMS access to and hereby grant RMS a non-exclusive, license in the Territory to use the Clinical Patient Data for the sole and limited purpose of, and only to the extent required to, research, develop, obtain Regulatory Approval for, make, have made, use, sell, offer for sale, import and otherwise exploit the RMS Product in the Diagnostic Field, including the right (a) to use Clinical Patient Data, specifically the underlying data as to whether or not EZH2 change of function mutations in the catalytic domain have been detected in a given Clinical Sample, to create, expand or enhance the Clinical Validation Data for the RMS Product, and (b) to include Clinical Patient Data to the extent necessary in RMS Product related filings with any Regulatory Authority. RMS shall ensure that Clinical Patient Data is not disclosed to or otherwise made available to Chugai or to any of RMS’s Affiliates or to any Third Party that is engaged in the discovery, development or commercialization of pharmaceutical products. The foregoing license shall not be sublicensable, except to any of RMS’ Affiliates or any Third Party developing, obtaining Regulatory Approval for, manufacturing or selling the RMS Product on behalf of RMS.

9.7. License to Assay Performance Data. RMS hereby gives Pharmaceutical Partners access to and hereby grants Pharmaceutical Partners a non-exclusive license to use the Assay Performance Data for the limited purpose of, and only to the extent required to, research, develop, obtain Regulatory Approval for, make, have made, use, sell, offer for sale, import, export and commercialize the Pharmaceutical Partners Product in the Pharmaceutical Field, including coordination of the RMS Product in connection with the development, distribution, marketing promotion, use and/or sale of the Pharmaceutical Partners Product. For purposes of clarity this license includes the right to include or refer to Assay Performance Data to the extent necessary in any Pharmaceutical Partners Product related filings, discussions or correspondence with any Regulatory Authority, but shall not include the right to include or refer to Assay Performance Data in any filings with any Regulatory Authority for any diagnostic product other than the RMS Product. Epizyme and Eisai shall ensure that the Assay Performance Data is not disclosed to or otherwise made available to any of Epizyme, Eisai or their Affiliates or any Third Party that is engaged in the discovery, development or commercialization of diagnostic products. The foregoing license shall not be sublicensable, except to any of Pharmaceutical Partners’ Affiliates or licensees or any Third Party that is developing, obtaining Regulatory Approval for, manufacturing or selling the Pharmaceutical Partners Product on behalf of or under license from Pharmaceutical Partners.

9.8. Extension of Licenses with Modification to Pharmaceutical Partners Product Definition. Unless otherwise agreed by the Parties in writing, in the event that the definition of Pharmaceutical Partners Product is modified in accordance with Section 3.3, the licenses granted from RMS to Pharmaceutical Partners herein shall

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automatically be expanded to cover the modified definition of Pharmaceutical Partners Product, subject to the limitations set forth in the proviso in the next to last sentence in Section 3.3. In addition, any licenses granted from Epizyme and Eisai to RMS above with respect to Pharmaceutical Partners Background IP and Pharmaceutical Partners Project Inventions shall automatically be expanded to cover the modified definition of Pharmaceutical Partners Product and the simultaneous modification to the definition of Pharmaceutical Partners Background IP and Pharmaceutical Partners Project Invention.

9.9. RMS Covenant Regarding [**]. With respect to [**], RMS hereby agrees and covenants that it shall not, and shall ensure that its Affiliates (and any licensees or assignees of any right, title or interest in the [**] that have a right to enforce any of the [**]) do not, directly or indirectly through any Third Party, undertake any legal proceedings or other actions to assert the [**] or any other intellectual property that is under any RMS Background IP that is related to PCR against Pharmaceutical Partners or their Affiliates, licensees or Third Parties who are developing, obtaining Regulatory Approval for, manufacturing, selling, prescribing or using the Pharmaceutical Partners Product on behalf of or under license from Pharmaceutical Partners, in connection with or as a result of the development, distribution, marketing, promotion, use and/or sale of the Pharmaceutical Partners Product, solely as such activities are related to the development, distribution, marketing, promotion, use, and/or sale of the Pharmaceutical Partners Product in the Pharmaceutical Field in conjunction with the RMS Product.

9.10. No License to RMS Outside the Diagnostic Field. In no event shall the license grants in Section 9.1 through Section 9.6 to the extent applicable to RMS provide RMS or any of its sublicensees with the right to research, develop, obtain Regulatory Approval for, make, have made, use, sell, offer for sale, import, export or commercialize any products for use outside the Diagnostic Field, including without limitation any product for use in the Pharmaceutical Field in connection with the RMS Product.

9.11. No Other Rights; No Implied Licenses. Only the licenses and other rights expressly granted by one Party to the other Party under terms of this Agreement are of any legal force or effect. No other licenses or other rights are granted, conveyed or created (whether by implication, estoppel or otherwise).

9.12. Independent Development Efforts. The Parties acknowledge and agree that the relationship between the Parties is non-exclusive and that Epizyme, Eisai, RMS and their Affiliates will retain the right to perform independent development activities as further outlined in this Section 9.12. As used herein, the term “Independent Development” by a Party shall mean undertaking development work, except if and to the extent permissible according to this Agreement, without the aid, application or use of any of the other Party’s(ies’) Background IP, Project Inventions and/or Confidential Information. For purposes of clarity, RMS may use its Assay Performance Data and RMS Project Inventions for its Independent Development, but shall not be permitted to use Clinical Patient Data or Pharmaceutical Partners Project Inventions for such development, and Pharmaceutical Partners may use its Clinical Patient Data and Pharmaceutical Partners Project Inventions for its Independent Development, but shall not be permitted to use Assay Performance Data and RMS Project Inventions for such development.

(a) Independent Development by Pharmaceutical Partners. Epizyme and/or Eisai and their Affiliates have and shall retain ownership of all rights, title, and interest in and to the Pharmaceutical Partners Product and will have the right to conduct Independent Development involving the use of the Pharmaceutical Partners Product or any other Epizyme product and/or Eisai product for any purpose (whether alone or in combination with any other product or service or inside or outside of the Pharmaceutical Field) and in collaboration with any Third Party. The foregoing shall include, without limitation, Epizyme’s and Eisai’s rights to independently develop, utilize and/or commercialize diagnostic tests (including in vitro diagnostic products, companion diagnostic products or assays intended for research use only directed to EZH2 mutations or any other marker), other than any RMS Products, in connection with the development and/or commercialization of the Pharmaceutical Partners Product or any other Epizyme products and/or Eisai products, whether alone or in collaboration with Third Parties.

(b) Independent Development by RMS. RMS and/or its Affiliates have and shall retain ownership of all rights, title, and interest in and to the RMS Product and are free to conduct Independent Development involving the use of the RMS Product for any purpose (whether alone or in combination with any other product or service) and in collaboration with any Third Party. The foregoing shall include, without limitation, RMS’ and/or its Affiliates’ rights to independently develop, utilize, and/or commercialize the RMS Product and/or other diagnostic tests (including in vitro diagnostic products, other companion diagnostic products, or

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assays intended for research use only directed to EZH2 mutations or any other marker), whether alone or in collaboration with Third Parties, for use either alone or in conjunction with the development or commercialization of any pharmaceutical products other than the Pharmaceutical Partners Product.

10. COMPLIANCE

10.1. Debarment. Each Party hereby certifies (on behalf of itself and its Affiliates) that it knowingly will not and has not employed or otherwise used in any capacity the services of any person (a) debarred under Title 21 United States Code Section 335a or any similar state law or regulation in performing any activities under this Agreement, (b) excluded from a Federal health care program as outlined in Sections 1128 and 1156 of the Social Security Act (see information about the Office of Inspector General of the Department of Health and Human Services List of Excluded Individuals/Entities at http://oig.hhs.gov/exclusions/index/asp) or from any state health care program, (c) excluded from contracting with the federal government (see the Excluded Parties Listing System as http://epls.arnet.gov) or (d) otherwise disqualified or restricted by the FDA pursuant to 21 C.F.R. 312.70, 21 C.F.R. 812.119, or any other Regulatory Authority.

10.2. Regulatory Disclosure Requirements. Upon written request from any other Party, each Party shall within [**] days provide written confirmation that it has complied with the obligations of Section 10.1. Each Party shall also provide all information to the other Parties necessary to comply with any disclosure requirements mandated by the FDA, including any information required to be disclosed in connection with any financial relationship between the Parties and any other agents or employees.

10.3. Notification of Debarment. Each Party shall immediately notify the other Party in writing if any change occurs such that the obligations of Section 10.1 may be breached or the status of the Party or its Affiliates or any of its employees or any Third Party Agent employed hereunder comes to its attention regarding the same, and shall, with respect to any person or entity so debarred promptly remove such person or entity from performing any activities related to or in connection with the Project Plan or this Agreement.

10.4. HIPAA. Pursuant to the Health Insurance Portability and Accountability Act of 1996, as subsequently amended ("HIPAA") and the Standards for Privacy of Individually Identifiable Health Information (the "Privacy Rule") a 45 CFR Parts 160 and 164, as amended, and to the extent RMS, and Epizyme, or Eisai receives or creates any Protected Health Information ("PHI", as defined in the Privacy Rule) from or on behalf of the other, each Party agrees to comply with all applicable regulations and laws relating thereto. Without limiting the foregoing, the Parties, however, do not anticipate sending or receiving any Individually Identifiable Health Information (as defined in the Privacy Rule) or PHI pursuant to this Agreement

10.5. Compliance. It is each Party's policy to conduct activities in accordance with applicable state and federal laws and regulations regarding Medicare, Medicaid, and other Third Party payer programs. Therefore, each Party covenants that:

(a) Neither it nor any of its Affiliates is excluded from participation in any state or federal healthcare program, as defined in 42 USC Section 1320a-7b(f) for the provision of items or services for which payment may be made by a federal healthcare program;

(b) It has not contracted with any employee, contractor, agent, vendor or any vendor's affiliate, including any Third Party Agent, knowing that the contracting party is excluded from participation in any state or federal healthcare program; and

(c) No final adverse action, as defined in 42 USC Section 1320a-7e(g)(1) and 42 USC Section 1320a-7a(g), has occurred or is pending against it or its Affiliates or Third Party Agents;

(d) Each Party agrees to notify the other Parties of any final adverse action, discovery of contract with an excluded entity or individual, or exclusion (as defined above) within [**] days of such action. No such notification will be required with respect to Affiliates of a Party.

10.6. Disclosure of Funding Pursuant to State Laws. The Parties acknowledge that certain state or federal laws now or in the future may require pharmaceutical, medical device and other companies to disclose information on

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compensation, gifts or other remuneration provided to physicians and other health care professionals. Each Party may report information about remuneration provided under this Agreement, as required by law. Once reported, such information may be publicly accessible.

11. REPRESENTATIONS, WARRANTIES AND COVENANTS

11.1. Mutual Representations. Each Party hereby represents and warrants to the other Parties as of the Effective Date that:

•It is a corporation duly organized, validly existing, and in good standing under applicable laws;

•It has obtained all necessary consents, approvals and authorizations of all governmental authorities and other persons or entities required to be obtained by it in connection with this Agreement;

•The execution, delivery and performance of this Agreement have been duly authorized by all necessary corporate action on its part; and

•It has the right to grant the applicable rights and licenses provided for under this Agreement.

Furthermore, each Party represents and warrants as of the Effective Date, and will endeavor to ensure such representation and warranty continues through the Term of this Agreement, that:

•Any Samples provided pursuant to this Agreement are provided hereunder without any obligations of compensation to donors of such Samples or any other Third Party for the intellectual property associated with, or commercial use of, such Samples for any purposes;

•Any Samples provided pursuant to this Agreement are provided with confirmation that the appropriate informed consents for the collection and use of such Clinical Samples were obtained, including but not limited to, consents for use sufficient to cover the Parties and the activities specified under the Project Plan; and

•Any Samples provided to a Party were collected stored, transported and delivered in compliance with all applicable laws rules and regulations.

Each of RMS, Epizyme and Eisai further hereby represents, warrants and covenants to the other Parties that during the Term it will not grant or convey to any Third Party any right, license or interest in any Patents that is inconsistent with the rights and licenses expressly granted to the other Party under this Agreement.

11.2. Mutual Representations, Warranties and Covenants. Each Party furtherrepresents, warrants and covenants to the other Parties as of the Effective Date and in performing the activities under this Agreement that:

(a) Neither such Party nor any of its Affiliates, nor any of its or their respective officers, employees, or agents will make an untrue statement of material fact or fraudulent statement to the FDA or any other Regulatory Authority with respect to the development of the RMS Product or Pharmaceutical Partners Product, will fail to disclose a material fact required to be disclosed to the FDA or any other Regulatory Authority with respect to the development of the RMS Product or Pharmaceutical Partners Product, or will commit an act, make a statement, or fail to make a statement with respect to the development of the RMS Product or Pharmaceutical Partners Product that could reasonably be expected to provide a basis for the FDA to invoke its Application Integrity Policy (as described in the "Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities" Final Policy set forth in 56 Fed. Reg. 46191 (September 10, 1991) and any amendments thereto) or any analogous laws or policies in the Territory;

(b) Such Party will comply with reporting requirements applicable to the RMS Product or Pharmaceutical Partners Product, as applicable, including, as applicable, post-market reporting requirements (including with respect to product changes and post-market adverse experience reports) and reporting requirements for clinical studies (including with respect to adverse experiences from studies) for the RMS Product or Pharmaceutical Partners Product, as applicable, in accordance with the Regulatory Authorization and any other regulations set forth by Regulatory Authorities. Such Party will also investigate any complaint related to the RMS Product or the Pharmaceutical Partners Product, as applicable, in a thorough and timely

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manner, and determine whether such complaint represents an event that must be reported to the appropriate Regulatory Authority. For clarity, RMS shall be responsible for satisfying reporting and complaint investigation requirements with respect to the RMS Product, and the Pharmaceutical Partners shall be responsible for satisfying reporting and complaint investigation requirements with respect to the Pharmaceutical Partners Product;

(c) Such Party shall perform, and cause to be performed, all of its responsibilities under the Project Plan in good scientific manner and in compliance with professional standards and quality consistent with the current state of research in relation to the performance of these responsibilities and with at least the degree of skill, knowledge and care generally used by qualified organizations in the relevant industry for projects of a similar nature and scope; and

(d) Such Party has or will obtain all appropriate licenses, permits, registrations, approvals (including Regulatory Approvals) and certifications necessary to safely, adequately and lawfully perform its obligations under this Agreement and the Project Plan in accordance with applicable laws and regulations.

11.3. Disclaimers. EXCEPT AS OTHERWISE EXPRESSLY STATED IN THIS AGREEMENT, NO PARTY MAKES ANY REPRESENTATION OR WARRANTY OF ANY KIND WITH RESPECT TO THE PATENTS, KNOW-HOW, MATERIALS, SAMPLES, ASSAY, IVD OR CO-DX, PHARMACEUTICAL PARTNERS PRODUCT, RMS TECHNOLOGY OR CONFIDENTIAL INFORMATION THAT IS LICENSED, SUPPLIED OR OTHERWISE MADE AVAILABLE BY IT TO THE OTHER PARTY UNDER THIS AGREEMENT (INCLUDING WITHOUT LIMITATION ANY WARRANTIES OF PATENT VALIDITY, ENFORCEABILITY AND/OR NONINFRINGEMENT), AND EACH PARTY HEREBY EXPRESSLY DISCLAIMS ANY AND ALL IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

11.4. Limitation of Damages. NO PARTY WILL BE LIABLE TO ANY OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, EXEMPLARY, PUNITIVE OR OTHER SIMILAR DAMAGES (INCLUDING, WITHOUT LIMITATION ANY CLAIMS FOR LOST PROFITS OR REVENUES) ARISING FROM OR RELATING TO THIS AGREEMENT OR PERFORMANCE UNDER, AND REGARDLESS OF ANY NOTICE OF SUCH DAMAGES, EXCEPT IN THE EVENT OF GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

12. INDEMNIFICATION

12.1. Indemnification of RMS. Subject to Section 12.4, Pharmaceutical Partners shall indemnify and hold harmless each of RMS, its Affiliates and its and their directors, officers, shareholders and employees and the successors and assigns of any of the foregoing (the “RMS Indemnitees”), from and against any and all liabilities, damages, penalties, fines, costs and expenses (including, reasonable attorneys' fees and other expenses of litigation) (“Liabilities”) from any claims, actions, suits or proceedings brought by a Third Party (each a “Third Party Claim”) incurred by any RMS Indemnitee, (a) arising from, or occurring as a result of: (i) the negligence or willful misconduct of Pharmaceutical Partners or their Affiliates or any of their respective directors, officers, or employees; or (ii) any breach of this Agreement by Pharmaceutical Partners; or (b) that alleges that the exploitation of the Pharmaceutical Partners Product directly infringes, misappropriates or otherwise violates or diminishes the intellectual property rights of a Third Party, including any claim that the exploitation of the RMS Product in conjunction with the Pharmaceutical Partners Product contributes to, induces or otherwise supports a direct Third Party Claim of infringement by the Pharmaceutical Partners Product; except in each case ((a) and (b)) to the extent such Third Party Claim falls within the scope of the indemnification obligations of RMS set forth in Section 12.2 or results from the gross negligence or willful misconduct of a RMS Indemnitee. For clarity, any Liabilities arising from Third Party Claims of direct infringement, misappropriation or other violation or diminishment of Third Party intellectual property rights by the Pharmaceutical Partners Product shall be indemnified pursuant to clause (b) of this Section 12.1, including such Liabilities arising from any failure to obtain or maintain any licenses or other rights with respect to such Third Party intellectual property rights or to make any payment in connection therewith..

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12.2. Indemnification of Pharmaceutical Partners. Subject to Section 12.4, RMS shall indemnify and hold harmless Eisai, Epizyme, their respective Affiliates, and the directors, officers and employees of Eisai, Epizyme and their Affiliates, and the successors and assigns of any of the foregoing (the “Pharmaceutical Partners Indemnitees”), from and against any and all Liabilities from any Third Party Claims incurred by any Pharmaceutical Partners Indemnitee, (a) arising from, or occurring as a result of: (i) the negligence or willful misconduct of RMS or any of its Affiliates or any of its or their respective directors, officers, or employees; or (ii) any breach of this Agreement by RMS; or (b) that alleges that the exploitation of the RMS Product directly infringes, misappropriates or otherwise violates or diminishes the intellectual property rights of a Third Party, including any claim that the exploitation of the Pharmaceutical Partners Product in conjunction with the RMS Product contributes to, induces or otherwise supports a direct Third Party Claim of infringement by the RMS Product; except in each case ((a) and (b)) to the extent such Third Party Claim falls within the scope of the indemnification obligations of Pharmaceutical Partners set forth in Section 12.1 or results from the gross negligence or willful misconduct of a Pharmaceutical Partners Indemnitee. For clarity, any Liabilities arising from Third Party Claims of direct infringement, misappropriation or other violation or diminishment of Third Party intellectual property rights by the RMS Product shall be indemnified pursuant to clause (b) of this Section 12.2, including such Liabilities arising from any failure to obtain or maintain any licenses or other rights with respect to such Third Party intellectual property rights or to make any payment in connection therewith..

12.3. Procedure. The Party that intends to claim indemnification under this Article 12 (the “Indemnitee”) shall promptly notify the other Party (the “Indemnitor”) in writing of any Third Party Claim, in respect of which the Indemnitee intends to claim such indemnification, and the Indemnitor shall have sole control of the defense and/or settlement thereof, including the right to select defense counsel and to direct the defense or settlement of any Third Party Claim. Notwithstanding the foregoing, the Indemnitor may not settle any Third Party Claim which places any obligation on the Indemnitee or admits any wrongdoing of the Indemnitee without the prior written consent of the Indemnitee, which consent shall not be unreasonably withheld or delayed. The failure to deliver written notice to the Indemnitor within a reasonable time after the commencement of any action with respect to a Third Party Claim, if substantially prejudicial to its ability to defend such action, shall relieve such Indemnitor of any liability to the Indemnitee under this Section 12.3, but the omission to so deliver written notice to the Indemnitor shall not relieve the Indemnitor of any liability that it may have to any Indemnitee otherwise than under this Section 12.3. The Indemnitee under this Section 12.3 shall cooperate fully with the Indemnitor and its legal representatives in the investigation of any action with respect to a Third Party Claim covered by this Article 12; provided that Indemnitee shall have the right at their own expense to select and to obtain representation by separate legal counsel.

12.4. Indemnification Threshold. Except for Pharmaceutical Partners’ obligation to indemnify RMS Indemnitees pursuant to Section 12.1(b) or RMS’ obligation to indemnify Pharmaceutical Partners Indemnitees pursuant to Section 12.2(b) (as to which obligations this Section 12.4 shall not apply), no indemnification shall be payable by a Party hereunder with respect to a Third Party Claim as to which such Party would be responsible for indemnification pursuant to Section 12.1 or 12.2 unless one of the following conditions is satisfied:

(a)Any individual Third Party Claim which exceeds [**] dollars ($[**]);

(b)The aggregate amount of one or more Third Party Claim(s) of the same or a similar nature (e.g., similar cause of action) which exceeds [**] dollars ($[**]); or

(c)The aggregate amount of one or more Third Party Claim(s) which exceeds [**] dollars ($[**]);

and once one of the foregoing conditions is satisfied, such indemnification obligation shall apply to the total amount of such Liabilities from the first dollar of such Liabilities. For clarity, Pharmaceutical Partners’ obligation to indemnify RMS Indemnitees pursuant to Section 12.1(b) or RMS’ obligation to indemnify Pharmaceutical Partners Indemnitees pursuant to Section 12.2(b) shall apply from the first dollar of Liability arising thereunder.

13. CONFIDENTIALITY

13.1. Obligation. RMS agrees to keep confidential and not to use, except for the purpose of conducting the Project, and/or exercising any rights granted to it under this Agreement, including the license rights set forth in Sections 9.1 through 9.6, any Confidential Information of Pharmaceutical Partners or their Affiliates, including the Clinical Patient Data, Pharmaceutical Partners Information, including any clinical protocols from Pharmaceutical Partners. RMS agrees to store the Clinical Patient Data and Pharmaceutical Partners Patient Materials in a secure

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location. RMS further agrees to limit access to the Confidential Information of Pharmaceutical Partners or their Affiliates solely to those employees, Affiliates of RMS, agents, and contractors who require access in order to perform the Project Plan and who have previously agreed in writing, either as a condition to employment or in order to obtain or access the Confidential Information of Pharmaceutical Partners or its Affiliates, to be bound by terms and conditions of confidentiality and non-use at least as stringent as the terms of this Agreement. For clarity, the foregoing limited right of disclosure of Pharmaceutical Partners Confidential Information with respect to RMS shall not include disclosure to employees of Chugai or to any employees of RMS’ Affiliates or any Third Party that is engaged in or involved with the discovery, development or commercialization of pharmaceutical products. Epizyme and Eisai both agree to keep confidential and not to use, except for the purpose of performing their obligations including conducting the Project Plan, and/or exercising any rights granted to them under this Agreement, including the license rights set forth in Sections 9.2 through 9.7, Confidential Information of RMS or its Affiliates, including the Assay Performance Data and RMS Information. Epizyme and Eisai further agree to limit access to the Confidential Information of RMS or its Affiliates solely to those employees, Affiliates of Epizyme or Eisai, and their licensees, agents and contractors, including any employees of Epizyme or Eisai or any employees of Epizyme’s or Eisai’s Affiliates who are engaged in the development of diagnostic products, who require access in order to perform activities relating to developing, manufacturing, obtaining Regulatory Approval for or selling the Pharmaceutical Partners Product in conjunction with the RMS Product or otherwise exercising their rights under this Agreement, and who have previously agreed in writing, either as a condition to employment or in order to obtain or access the Confidential Information of RMS or its Affiliates, to be bound by terms and conditions of confidentiality and non-use at least as stringent as the terms of this Agreement. For clarity, the foregoing limited right of disclosure of RMS Confidential Information with respect to Pharmaceutical Partners shall not include disclosure to any employees of Epizyme’s or Eisai’s Affiliates (Affiliates, either now or later become) or any Third Party partners/collaborators that are exclusively engaged in, or exclusively involved with, development and commercialization of diagnostic products in competition with RMS. The obligations of confidentiality and non-use in this Section 13.1 shall continue during the Term and expire [**] from the termination or expiration of this Agreement. These obligations of confidentiality and non-use shall not apply to the Confidential Information of a Party or its Affiliates which:

•is publicly available by use and/or publication before its receipt from the disclosing Party or its Affiliates, or on their behalf, or before its development under the Project, or thereafter become publicly available through no fault of the receiving Party;

•was already in the receiving Party's possession without obligation of confidentiality back to the disclosing Party prior to receipt from the disclosing Party or an Affiliate of the disclosing Party or prior to its development under the Project;

•is or was developed on their behalf outside of this Agreement independently of and without access to or use of the Confidential Information of the disclosing Party, as evidenced by records kept by the receiving Party in the ordinary course of business; or

•is properly obtained by the receiving Party from a Third Party which has a valid right to disclose such information to the receiving Party, is not under a confidentiality obligation to the disclosing Party or its Affiliate, and is not disclosing such information to the receiving Party on behalf of the disclosing Party or an Affiliate.

13.2. Exceptions. Notwithstanding the obligations of confidentiality and non-use set forth in Section 13.1 above, each Party shall be permitted to disclose Confidential Information of the other Party that is required to be disclosed to comply with applicable laws, court order, or governmental regulations, provided that such Party provides prior written notice of such disclosure to the Party whose Confidential Information is being disclosed and takes reasonable and lawful actions to avoid and/or minimize the degree of such disclosure. The prior written notice must be given as soon as reasonably possible in order to permit the Party whose Confidential Information is being disclosed to challenge such disclosure or to seek a protective order or some other accommodation to protect the confidentiality of the information that is required to be disclosed. Despite disclosure of Confidential Information as permitted under this Section 13.2, such Confidential Information shall retain its confidential nature until precluded otherwise under Section 13.1 above, and the permitted disclosure of Confidential Information shall be limited to only that Confidential Information that is necessary to comply with such law, order or regulation.

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13.3. No License. Disclosure of Confidential Information by one Party to another Party pursuant to this Agreement does not convey, grant, transfer or otherwise create any option, license or other rights or interests beyond those licenses expressly granted in this Agreement.

14. PUBLICITY AND PUBLICATION

14.1. Publicity. Promptly following the Effective Date, the Parties shall issue a press release in the form agreed by the Parties.Following such initial press release,no Party hereto may issue any other press release or other public statement or announcement concerning this Agreement, the subject matter hereof, or the research, development or commercial results of the products hereunder without the other Parties’ prior written consents. In addition, no Party hereto shall make any disclosure of this Agreement and/or the terms and conditions set forth herein, or use the name or any trademarks, logos or trade dress of another Party or its Affiliates in any publicity, press release or other form of public announcement or disclosure without the prior written consent of such other Party. Notwithstanding the foregoing, any Party may disclose the terms or existence of this Agreement if required by law or regulation, including without limitation applicable securities laws and regulations and rules and regulations of securities exchanges. If the terms or existence of this Agreement are required to be disclosed by law or regulation, such Party will give the other Parties’ prior written notice of the disclosure requirement and a reasonable opportunity to review and comment on what is intended to be disclosed before disclosure.

14.2. Publication. The Parties shall have the right to publish, present or use the Project Inventions and/or any portion thereof for their instructional, or publication objectives, or for non-confidential discussions with a Third Party (a “Publication”). Epizyme and Eisai will generally be responsible for and control the timing and scope of any Publication of Clinical Patient Data and/or Pharmaceutical Partners Project Invention. RMS will generally be responsible for and control the timing and scope of any Publication of the Assay Performance Data and/or RMS Project Invention. Any Publications of the Joint Inventions must be agreed and approved by all Parties. Furthermore, Epizyme and Eisai shall not have the right to publish, present or use the Assay Performance Data, the RMS Project Invention or any portion thereof for any Publication without RMS’ prior written consent, and RMS shall not have the right to publish, present or use the Clinical Patient Data, the Pharmaceutical Partners Project Invention or any portion thereof for any Publication without Epizyme and Eisai’s prior written consents. Such Publication shall be subject to the provisions of this Agreement relating to confidentiality and non‑disclosure, and shall be consistent with academic standards. At least [**] days prior to submission for publication, or [**] business days prior to submission for presentation or use (including abstracts), the publishing Party shall submit to the other Party for review any proposed Publication. The other Party shall review the proposed Publication and provide its comments to the publishing Party no later than [**] days prior to the proposed submission date for the Publication. The Parties agree that the non-publishing Party may request the proposed submission date to be delayed, and the publishing Party agrees to delay, by up to an additional [**] days in order to provide its comments or address concerns regarding the Publication. In addition, upon the other Party’s notice to the publishing Party that the other Party reasonably believes that one or more patent applications should be filed which relate to Project Inventions owned by the other Party or Joint Inventions prior to any Publication, the publishing Party shall delay the Publication until such patent application(s) have been filed, provided that the other Party will cooperate in expeditiously filing any such patent application(s), and provided further that any such delay of a Publication will not exceed [**] days from the date of such notice by the other Party to the publishing Party. If the other Party believes that any Publication contains Confidential Information or other proprietary information belonging to such Party, such Party will notify the publishing Party, which will remove all references to such Confidential Information or proprietary information prior to publication, presentation or use.

15. TERM AND TERMINATION

15.1. Term of Agreement. The term of this Agreement (the “Term”) commences on the Effective Date and shall continue for as long as a Pharmaceutical Partners Product is being developed or offered for sale by Pharmaceutical Partners in any country in the Territory of an agreed upon Project Plan, unless terminated earlier in accordance with Sections 15.2 to 15.6 below.

15.2. Termination by Mutual Agreement. This Agreement or any Project Plan may be terminated at any time by mutual written agreement of all the Parties. In such event, the Parties will agree upon and conduct an orderly wind down of any ongoing activities being performed under the Project Plan.

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15.3. Termination for Changes to Key Assumptions. Any Party may terminate this Agreement or any Project Plan upon sixty (60) days’ prior written notice to the other Parties in case of any Changes which cannot be addressed and resolved by amending the Project Plan; provided, however, that RMS shall not have the right to terminate this Agreement in connection with any Changes to the extent that such Changes result from or arise out of RMS’ negligence or failure to exercise due care in the performance of its obligations under this Agreement. The Parties agree to address and resolve Changes which cannot be addressed and resolved by amending the Project Plan through the processes set forth in Sections 3.2, 4.1(d), 4.2(d), and 4.3 above and, if applicable, Article 16, and the right to terminate the Agreement or any Project Plan pursuant to this Section 15.3 shall only apply if an arbitrator issues an arbitration decision in accordance with Article 16 stating that it is not commercially reasonable to address and resolve such Changes through an amendment to the Project Plan.

15.4. Termination by Pharmaceutical Partners after Initiation of the Project. Pharmaceutical Partners may terminate this Agreement or any Project Plan by providing RMS with ninety (90) days’ prior written notice in the event that:

•Pharmaceutical Partners determines in their sole discretion to discontinue the partnership regarding the Pharmaceutical Partners Product and that neither Epizyme nor Eisai will offer the Pharmaceutical Partners Product for sale in at least one country or region in the Major Markets; or

•Pharmaceutical Partners determine, following prior discussion with RMS via the JSC, that the Assay being developed under such Project Plan is no longer needed for use with the Pharmaceutical Partners Product.

In such event, during such ninety (90) day period, the Parties will agree upon and conduct an orderly wind down of any ongoing activities being performed under the Project Plan.

15.5. Termination for Breach. Any Party shall have the right to terminate this Agreement in the event that one of the other Parties is in breach of one or more of its material obligations under this Agreement, by providing the breaching Party (and if the breaching Party is Epizyme, providing Eisai, or if the breaching Party is Eisai, providing Epizyme) written notice describing the breach with a copy to the other Party. The Parties acknowledge and agree that, in the event of a breach by Epizyme, Eisai shall have the right to cure such breach on Epizyme’s behalf, and vice versa. If the breaching Party has not cured such material breach within [**] days after receipt of such notice, then termination of the Agreement shall be effective immediately upon notice of termination after expiration of such period; provided that RMS shall not have the right to terminate this Agreement in the event of a breach by a Pharmaceutical Partner if the other Pharmaceutical Partner has cured such breach during the [**] day cure period. Notwithstanding the foregoing the Parties may agree to extend such [**] day cure period my mutual written agreement.

15.6. Termination for Insolvency or Bankruptcy. Any Party may terminate this Agreement with respect to another Party effective on written notice to the other Parties upon the liquidation, dissolution, winding‑up, insolvency, bankruptcy, or filing of any petition therefor, appointment of a receiver, custodian or trustee, or any other similar proceeding, by or of such other Party where such petition, assignment or similar proceeding is not dismissed or vacated within ninety (90) days. All rights and licenses granted pursuant to this Agreement are, for purposes of Section 365(n) of Title 11 of the United States Code or any foreign equivalents thereof (as used in this Section 15.6, “Title 11”), licenses of rights to “intellectual property” as defined in Title 11. Each Party in its capacity as a licensor hereunder agrees that, in the event of the commencement of bankruptcy proceedings by or against such bankrupt Party under Title 11: (i) the other Party(ies), in its/their capacity as a licensee(s) of rights under this Agreement, retains and may fully exercise all of such licensed rights under this Agreement, including as provided in this Section 15.6, and all of its rights and elections under Title 11; and (ii) the other Party(ies) is/are entitled to a complete duplicate of all embodiments of such intellectual property, and such embodiments, if not already in its possession, will be promptly delivered to the other Party: (1) upon any such commencement of a bankruptcy proceeding, unless the bankrupt Party elects to continue to perform all of its obligations under this Agreement; or (2) if not delivered under (1), immediately upon the rejection of this Agreement by or on behalf of the bankrupt Party.

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15.7. Consequences of Termination.

(a) If RMS terminates this Agreement or a Project Plan pursuant to Section 15.3, 15.5 or 15.6, or if the Parties terminate this Agreement or a Project Plan pursuant to Section 15.2, and RMS is not in material breach of this Agreement, then Pharmaceutical Partners shall reimburse RMS for [**]; provided, however, that Pharmaceutical Partners shall not be obligated to pay [**].

(b) If RMS terminates this Agreement or a Project Plan pursuant to Section 15.4, and RMS is not in material breach of this Agreement, then the Parties shall agree [**] and Pharmaceutical Partners shall pay to RMS [**]. If the Parties cannot agree [**], the Parties agree that such disputes shall be resolved by Senior Officers in accordance with Section 4.3, and then, if applicable, by Arbitration in accordance with Article 16. Without limiting the foregoing, (i) in the event that such termination occurs after completion of [**], Pharmaceutical Partners shall pay to RMS [**] dollars ($[**]), and (ii) in the event that such termination occurs after completion of [**], Pharmaceutical Partners shall pay to RMS [**] dollars ($[**]) (either the fees in (i) or (ii), the “Deferred Fee”); provided that, for clarity, in the event that Pharmaceutical Partners is obligated to make a payment for Deferred Fee to RMS pursuant to clause (ii), they shall not also be obligated to make a payment for Deferred Fee to RMS pursuant to clause (i). Any applicable Deferred Fee in addition to any applicable [**] that may be due as set forth above in this Section 15.7(b) shall be collectively the “Termination Fees”. In addition, Pharmaceutical Partners shall pay to RMS and any additional costs associated with the agreed upon orderly wind down of any then-ongoing activities under the Project Plan. For clarity, (1) for purposes of calculating the Termination Fees (if any) due to RMS pursuant to this Section 15.7(b) only, the milestone reference amounts set forth on Part I of Exhibit E shall apply, (2) for purposes of any milestones that have been completed prior to termination (which were not invoiced and/or paid), such milestones shall be deemed earned and the milestone amounts set forth in Exhibit B shall apply and be paid in accordance with Article 7; and, unless otherwise expressly agreed by the Parties in writing, in no event shall Pharmaceutical Partners be obligated to pay RMS more than an aggregate of [**] dollars ($[**]) in milestones and Termination Fees under this Agreement. For illustrative purposes only, Part II of Exhibit E provides sample calculations for two different scenarios under this Section 15.7(b).

(c) The expiration or early termination of this Agreement, for any reason, shall not affect any rights or obligations that have already accrued as of the date of such expiration or termination, nor preclude any Party from pursuing any rights and remedies it may have under this Agreement or at law or in equity which accrued or are based upon any event occurring before expiration or termination.

(d) Upon the expiration or earlier termination of this Agreement, the licenses granted in Sections 8.7 and 9.1 to 9.8 and the covenant not to sue in Section 9.9 shall survive and shall become perpetual, irrevocable and fully paid-up.

(e) If this Agreement or a Project Plan is terminated by any Party for any reason after the first commercial sale of a RMS Product in any country in the Major Markets, RMS shall, if requested in writing by Pharmaceutical Partners, continue to manufacture and supply the RMS Product for sale in the Major Markets in accordance with this Agreement in such quantities as may be required for a minimum period of [**] following termination. RMS shall in addition provide access on reasonable commercial terms to such Contract Laboratories in the Major Markets who shall be fully enabled to perform any testing using the RMS Product in connection with use of the Pharmaceutical Partners Product.

15.8. Disposition of Confidential Information. Upon termination of this Agreement, each Party shall, except to the extent necessary or appropriate under any licenses which survive such termination or for archival purposes to be held by such Party’s legal department, promptly return (or destroy and provide written certification thereof) to the other Party all of the other Party’s Confidential Information (including any copies thereof).

15.9. Disposition of Materials. Upon the expiration or earlier termination of this Agreement, or earlier if requested, all residual amounts of Materials provided to RMS by Pharmaceutical Partners shall be returned to Pharmaceutical Partners upon their request within [**] days of such notice of request, except to the extent necessary or appropriate as required for verification to any Regulatory Authority for any activities conducted under the Project Plan. For any Materials provided to RMS by or on behalf of Pharmaceutical Partners and sent to Contract Laboratories or which were directly sent to Contract Laboratories, RMS agrees to assist in arranging for the return of such Materials within [**] days of such notice of request. Such request shall include instructions on where and how such Materials

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are to be returned to Pharmaceutical Partners, at Pharmaceutical Partners’ expense. Without limiting the foregoing, if Pharmaceutical Partners terminate this Agreement pursuant to Section 15.5 or Section 15.6, RMS shall provide Pharmaceutical Partners with [**]. If Pharmaceutical Partners terminate this Agreement pursuant to Section 15.5 or Section 15.6, RMS agrees to make Assay Performance Data generated prior to the date of such termination available to the extent required by Pharmaceutical Partners to exercise its license rights under Section 9.7.

15.10. Survival. In addition to any provisions specified in this Agreement as surviving under the applicable circumstances, the provisions of Sections 5.12(b), 7.3, 7.4, 9.5, 9.11, 15.7, 15.8, 15.9, 17.1, 17.10 and Articles 2, 8, 11, 16 of this Agreement and the definition for any defined terms contained within this Agreement survive expiration or termination of this Agreement.

16. DISPUTE RESOLUTION

16.1. Arbitration. Except as otherwise expressly provided in this Agreement, any dispute or disagreement between the Parties arising under or in connection with this Agreement and/or their performance hereunder will be finally resolved through binding arbitration. The arbitration shall be conducted pursuant to the Commercial Arbitration Rules and Supplementary Procedures for Large Complex Disputes of the American Arbitration Association (“AAA”) and the provisions of this Section 16.1.

16.2. Arbitration Panel. The arbitration shall be conducted by a panel of three (3) arbitrators. Within [**] days after the initiation of the arbitration, Pharmaceutical Partners will nominate one person to act as an arbitrator, RMS will nominate one person to act as an arbitrator, and the two arbitrators so named will then jointly appoint the third arbitrator within [**] days of their appointment, who will serve as chairman of the arbitration panel. All three (3) arbitrators must be independent Third Parties having at least ten (10) years of dispute resolution experience (including judicial experience) and/or legal or business experience in the biotech or pharmaceutical industry. If any Party fails to timely nominate its arbitrator, or if the arbitrators selected by the Parties cannot agree on the person to be named as chairman within such [**] day period, the AAA will make the necessary appointments for such arbitrator(s) or the chairman. Once appointed by a Party(ies), such Party(ies) will have no ex parte communication with its appointed arbitrator.

16.3. Location and Proceedings. The place of arbitration will be Chicago, Illinois, or such other venue as the Parties may mutually agree. The arbitration proceedings and all communications with respect thereto will be in English. Any written evidence originally in another language will be submitted in English translation accompanied by the original or a true copy thereof. The arbitrators have the power to decide all matters in dispute, including any questions of whether or not such matters are subject to arbitration hereunder. The decisions of the arbitrators shall be final and binding on the Parties and shall not be subject to appeal

16.4. Limitation on Awards. The arbitrators shall have no authority to award any punitive, exemplary, consequential, indirect, special or other similar damages. Each Party shall bear its own costs and expenses (including without limitation attorneys’ fees and expert or consulting fees) incurred in connection with the arbitration. RMS shall bear [**] percent ([**]%) and Pharmaceutical Partners shall bear [**] percent ([**]%) of the arbitrator’s fees and any other administrative costs and expenses associated with the arbitration.

16.5. Confidentiality. No Party, nor any of the arbitrators, shall be permitted to disclose the existence, content or results of any arbitration proceedings pursuant to this Article 16, without the prior written consent of the other Parties.

16.6. Equitable Remedies. Notwithstanding anything in this Agreement to the contrary, any Party shall have the right to seek a temporary injunction or other interim equitable relief from a court of competent jurisdiction in order to protect its rights and interests under this Agreement pending the outcome of any arbitration hereunder. However, such court will have no jurisdiction or ability to resolve disputes beyond the specific issue of temporary injunction or other interim equitable relief.

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16.7. Continued Performance During Dispute. During the pendency of any arbitration proceedings under this Article 16, the Parties will continue using Commercially Reasonable Efforts to perform their respective obligations under the Agreement and in accordance with its provisions in a manner which to the fullest extent practicable will maintain the status quo of the Parties with respect to those matters which are the subject to the dispute.

17. MISCELLANEOUS

17.1. Governing Law. This Agreement shall be construed in accordance with the laws of the State of Delaware in the United States of America, without regard or reference to any of its rules or provisions governing conflict of laws.

17.2. Independent Contractors. Nothing in this Agreement is intended or will be deemed to constitute a partnership, agency, distributorship, employer-employee relationship or joint venture relationship between the Parties. No Party is permitted or shall have any authority to bind or make any commitments for or on behalf of any other Party, except to the extent expressly provided in this Agreement or the Project Plan.

17.3. Performance by Affiliates and Sublicenses. Each Party is responsible for its Affiliates performance of any activities under this Agreement, and will cause its Affiliates to comply with the provisions of this Agreement in connection with such performance. Each Party is responsible for its permitted sublicense’s, including any Third Party Agents, compliance with the terms of the licenses granted herein.

17.4. No Strict Construction; Headings. This Agreement has been prepared jointly and will not be strictly construed against any Party. Ambiguities, if any, in this Agreement will not be construed against any Party, irrespective of which Party may be deemed to have authored the ambiguous provision. The headings of each Article and Section in this Agreement have been inserted for convenience of reference only and are not intended to limit or expand the meaning of the language contained in the Article or Section.

17.5. Assignment. No Party is permitted to assign its interest under this Agreement without the express prior written consent of the other Parties; provided, however, that a Party may assign this Agreement without such consent (i) to an Affiliate, or (ii) to any purchaser of all or substantially all of the business or assets of such Party or to any successor corporation or entity to which this Agreement relates (whether by way of merger, acquisition or otherwise), so long as the entity to which this Agreement is assigned expressly agrees in writing to assume and be bound by all obligations of the assigning Party under this Agreement. Any purported assignment without a required consent is null and void. No assignment will relieve any Party of responsibility for the performance of any obligation that accrued before the effective date of assignment. This Agreement is binding upon the permitted successors and assigns of the Parties.

17.6. Further Actions. Each Party will execute, acknowledge and deliver such further instruments, and do all such other acts, as may be necessary or appropriate in order to carry out the purposes and intent of this Agreement.

17.7. Notices and Deliveries. Any notices required or provided by the terms of this Agreement shall be in writing, addressed in accordance with this Section, and shall be delivered, except as otherwise indicated below, personally or sent by certified or registered mail, return receipt requested, postage prepaid, or by nationally-recognized express courier services providing evidence of delivery. Except as noted below, the effective date of any notice shall be the date of first receipt by the receiving Party. Notices shall be sent to the address(es)/addressee(s) given below or to such other address(es)/addressee(s) as the Party to whom notice is to be given may have provided to the other Party(ies) in writing in accordance with this provision.

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If to Epizyme:	Epizyme, Inc.
	325 Vassar Street
	Cambridge, Massachusetts 02139
	Attention: Chief Business Officer
with a copy to:	WilmerHale LLP
	60 State Street
	Boston, MA 02109
	Attention: Steven D. Barrett, Esq.
If to Eisai:	Eisai Co., Ltd.
	Koishikawa 4-6-10
	Bunkyo-Ku
	Tokyo 112-8088
	Japan
	Attention: Chief Product Creation Officer
with copies to:	Eisai Co., Ltd.
	Koishikawa 4-6-10
	Bunkyo-Ku
	Tokyo 112-8088
	Japan
	Attention: General Counsel
and	Eisai Inc.
	100 Tice Blvd.
	Woodcliff Lake, NJ 07677
	Attention: President General Counsel
Submit invoices to:	Both Pharmaceutical Partners
	(at addresses above, but not to copy addressees above)
If to RMS:
(Technical contact)	RMS Molecular Systems, Inc.
	4300 Hacienda Drive
	Pleasanton, California 94588
	Attention: Genomics and Oncology Lifecycle Team Leader
(Administrative contact)	RMS Molecular Systems, Inc.
	4300 Hacienda Drive
	Pleasanton, California 94588
	Attention: Legal Department
With a copy to:	RMS Molecular Systems, Inc.
	4300 Hacienda Drive
	Pleasanton, California 94588
	Attention: Business Development

17.8. Force Majeure. No Party will lose any rights hereunder or be liable to the other Party(ies) for damages or losses (except for payment obligations for activities performed under this Agreement) on account of failure of performance by the nonperforming Party if the failure is occasioned by war, strike, fire, act of God, earthquake, flood, lockout, embargo, governmental acts or orders or restrictions, failure of suppliers (that could not be reasonably foreseen nor prevented by the nonperforming Party), prevention from or hindrance in obtaining energy or other utilities, a market shortage of raw materials or necessary components, or any other reason where failure to perform is beyond the reasonable control and not caused by the negligence, intentional conduct or misconduct of the

Page 36 of 42

nonperforming Party and the nonperforming Party has exerted all reasonable efforts to avoid or remedy such force majeure and to mitigate the extent of damages from such force majeure, as much as feasible; but, in no event will a Party be required to settle any labor dispute or disturbance.

17.9. Severability; Waiver. If any one or more of the provisions of this Agreement should for any reason be held by any court or authority having jurisdiction over this Agreement or any of the Parties to be invalid, illegal or unenforceable, such provision or provisions will be reformed to as nearly as possible approximate the intent of the Parties without adversely affecting the rights or obligations of the Parties and, if it cannot be so reformed and if the rights or obligations of the Parties will not be materially and adversely affected thereby, such provision will be divisible and deleted. Any delay in enforcing a Party’s rights under this Agreement or any waiver as to a particular default or other matter will not constitute a waiver of such Party’s rights to the future enforcement of its rights under this Agreement, except with respect to an express written and signed waiver relating to a particular matter for a particular period of time.

17.10. Entire Agreement; Modification. This Agreement, together with any Attachments attached hereto and specifically referenced herein, constitutes the entire agreement between the Parties with respect to the Project and supersedes and replaces any and all previous arrangements and understandings, whether oral or written, between the Parties with respect to the Project; provided, however, that the CDAs shall survive and remain in effect for proprietary information of the Parties that falls outside the scope of Article 12 of this Agreement; and provided, further, that as between Epizyme and Eisai, nothing herein is intended or shall be construed to amend or modify such Parties’ rights or obligations under the Collaboration Agreement. Any amendment or modification to this Agreement shall be of no effect unless made in a writing signed by an authorized representative of each Party. If there is a conflict between the terms of this Agreement and any Attachments hereto, the terms of this Agreement shall prevail.

17.11. Counterparts. This Agreement may be signed in any number of counterparts (facsimile and electronic transmission included), each of which shall be deemed an original, but all of which shall constitute one and the same instrument. After facsimile or electronic transmission, the Parties agree to execute and exchange documents with original signatures.

(Remainder of this page is left intentionally blank.)

Page 37 of 42

The Parties have executed this Agreement, by their respective duly authorized representatives, to be effective as of the Effective Date.

ROCHE MOLECULAR SYSTEMS, INC.		EPIZYME, INC.
By:	/s/ P.A. Brown	By:	/s/ Jason Rhodes
	(signature)		(signature)
Name:	P.A. Brown	Name:	Jason Rhodes
	(printed name)		(printed name)
Title:	President and CEO RMS	Title:	EVP and CBO
Date:	18 December 2012	Date:	20 December 2012
		EISAI CO., LTD.
		By:	/s/ Kenichi Nomoto
			(signature)
		Name:	Kenichi Nomoto
			(printed name)
		Title:	President, Oncology PCU
		Date:	23 December 2012

Page 38 of 42

EXHIBIT B

PAYMENT PLAN

Milestones:

Epizyme, on behalf of Epizyme and Eisai, will pay RMS the following milestone payments upon completion of activities associated with the milestone:

#	Milestone	Payment
1	[**]	[**]
2	[**]	[**]
3	[**]	[**]
4	[**]	[**]
5	[**]	[**]
6	[**]	[**]
7	[**]	[**]
8	[**]	[**]
9	[**]	[**]
1	[**]	[**]
1	[**]	[**]
1	[**]	[**]
1	[**]	[**]

In the event that RMS has completed [**] Project Plan and thereafter any excessive delay or failure of performance by Pharmaceutical Partners prevents RMS from filing and therefore obtaining Regulatory Approval thereof in the United States, where RMS would otherwise have earned such subsequent milestone(s) but for such excessive delay or failure of performance by Pharmaceutical Partners, then RMS may send a notice to Pharmaceutical Partners asserting that such circumstances exist. If Pharmaceutical Partners do not either send RMS a notice of termination pursuant to Article 15 or a notice disputing the existence of such circumstances within [**] days after the notice from RMS asserting such circumstances, and if RMS is not in material breach of the Agreement, RMS shall be deemed to have earned [**] dollars ($[**]), which amount shall be creditable against all unearned milestones and any Termination Fees, if applicable. Any dispute as to the applicability of this paragraph shall be resolved in accordance with the terms of Article 16. For clarity, unless otherwise expressly agreed by the Parties in writing, in no event shall Pharmaceutical Partners be obligated to pay RMS more than an aggregate of [**] dollars ($[**]) in milestones (including any amount that may become payable pursuant to this paragraph) and Termination Fees under this Agreement.

Page 39 of 42

EXHIBIT E

MILESTONES AND EXAMPLES FOR SECTION 15.7(b)

Page 40 of 42

Part I: Milestone Reference Amounts for Purposes of Section 15.7(b)

Milestone	Payment
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]

Page 41 of 42

Part II: Sample Calculations under Section 15.7(b) (for illustrative purposes only)

[**]

Page 42 of 42

EX-10.23

Exhibit 10.23

Certain identified information has been excluded from the exhibit because it is both (i) not material and (ii) is the type of information that the registrant treats as private or confidential. Double asterisks denote omissions.

FIRST AMENDMENT

TO

COMPANION DIAGNOSTICS AGREEMENT

This First Amendment (“Amendment”) shall be effective as of this 31st day of May 2013 (“Amendment Effective Date”), by and between Epizyme, Inc., having a place of business at 400 Technology Square, 4th Floor, Cambridge, Massachusetts 02139, U.S.A. (“Epizyme”) and Eisai Co., Ltd., having a place of business at Koishikawa 4-6-10, Bunkyo-ku, Tokyo 112-8088, Japan (individually, “Eisai” and collectively with Epizyme, “Pharmaceutical Partners”), on the one side, and Roche Molecular Systems, Inc., having a place of business at 4300 Hacienda Drive, Pleasanton, California 94588, U.S.A. (“RMS”), on the other side, as an amendment to the Companion Diagnostics Agreement, dated 18th December 2012 (“Agreement”). Capitalized terms used in this Amendment and not defined in this Amendment shall have the meanings ascribed to them in the Agreement.

WHEREAS, Epizyme, Eisai and RMS are Parties to the Agreement and desire to amend the Agreement as set forth in this Amendment;

WHEREAS, Epizyme and Eisai have identified additional mutations in [**] of the EZH2 gene (“Additional Mutations”), which the Pharmaceutical Partners desire the Assay being developed by RMS also detect; and

WHEREAS, RMS is willing to modify the Assay being developed under the Agreement to include detection of the Additional Mutations, subject to the changes in the Project Plan and the Payment Plan, as well as the other provisions set forth herein.

NOW, THEREFORE, in consideration of the agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which each Party hereby acknowledges, the Parties hereby agree as follows:

1. The definition of Assay in Section 2.5 of the Agreement is hereby amended and restated in its entirety to read as follows:

““Assay” means an assay developed by RMS that is directed to EZH2 mutations in [**] and such other mutations as the Parties may agree, and shall include without limitation any biological materials, associated reagents, procedures, controls, instrumentation and/or software necessary to perform the assay, but shall exclude any Samples or other materials that the Assay is intended to test.”

2. The current Project Plan under the Agreement is hereby replaced in its entirety with the amended and restated Project Plan set forth in Attachment 1 to this Amendment.

3. In consideration for the additional activities required from RMS for the changes to the Project Plan, as updated in Attachment 1, the Pharmaceutical Partners agree to compensate RMS Five Hundred Thousand Dollars ($500,000.00) in addition to the payments previously set forth in the Payment Plan. This additional compensation shall become payable upon the execution of this Amendment and shall be paid following receipt of an invoice therefor from RMS in accordance with Section 7.2 of the Agreement.

RMS – Epizyme/Eisai

1st Amendment to CoDx Agr

Effective Date: 31 MAY 2013

Page 1 of 6

In addition, the following adjustments shall be made to the Agreement with respect to this additional compensation:

a. The second to last sentence in Section 15.7(b) shall be amended as follows:

The phrase “… in no event shall Pharmaceutical Partners be obligated to pay RMS more than an aggregate of twenty-one million dollars ($21,000,000) in milestones and Termination Fees…” shall be replaced in its entirety with “in no event shall Pharmaceutical Partners be obligated to pay RMS more than an aggregate of twenty-one million, five hundred thousand dollars ($21,500,000) in milestones and Termination Fees…”

b. The last sentence in Exhibit B, Payment Plan, shall be replaced in its entirety with the following:

“For clarity, unless otherwise expressly agreed by the Parties in writing, in no event shall Pharmaceutical Partners be obligated to pay RMS more than an aggregate of twenty-one million, five hundred thousand dollars ($21,500,000) in milestones (including any amount that my become payable pursuant to this paragraph) and Termination Fees under this Agreement.”

4. Exhibits B and E of the Agreement are hereby further amended by replacing each reference to [**] therein with [**].

5. Exhibit C of the Agreement is hereby replaced in its entirety with the amended and restated Exhibit C set forth in Attachment 2 to this Amendment.

6. The Parties acknowledge that additional licenses or other rights to access and/or use Third Party technology or intellectual property rights may be necessary for the development, manufacture, use or commercialization of the RMS Product, due to the development of the Assay to include detection of the Additional Mutations, and that such Third Party technology or intellectual property rights may or may not be also needed for Pharmaceutical Partners Product. Section 5.12(a) of the Agreement is hereby amended such that Pharmaceutical Partners shall be solely responsible for obtaining and maintaining any Third Party intellectual property rights necessary for the development, manufacture, use or commercialization of the RMS Product, to the extent such Third Party intellectual property right would not have been needed for the RMS Product but for the inclusion of the Additional Mutations. Pharmaceutical Partners agree to provide reasonable opportunity for RMS to review and comment on any proposed terms of the Third Party agreement pursuant to which Pharmaceutical Partners obtain such rights that, in Pharmaceutical Partners’ reasonable determination, would impose additional obligations or restrictions on RMS (beyond what is contemplated under the Agreement (as amended) for similar intellectual property rights) with respect to the RMS Product, including a final right of approval over any terms of such agreement that would impose such additional obligations or restrictions on RMS prior to execution, such approval not to be unreasonably withheld, delayed or conditioned. In addition, Pharmaceutical Partners agree to provide a draft of any such Third Party agreement to RMS at least [**] business days prior to execution and to reasonably consider any objections as to

RMS – Epizyme/Eisai

1st Amendment to CoDx Agr

Effective Date: 31 MAY 2013

Page 2 of 6

obligations or restrictions that such Third Party agreement would impose on RMS with respect to the RMS Product that RMS may timely raise. Any disputes over compliance with this paragraph shall be first resolved by the Senior Officers of the Parties pursuant to Section 4.3, and if still unresolved, then pursuant to the arbitration provisions set forth in Section 16. Once such Third Party intellectual property agreement is finalized and executed, Pharmaceutical Partners agree to be solely responsible for any and all costs thereof to the extent relating to Third Party intellectual property rights that would not have been needed for the RMS Product but for the inclusion of the Additional Mutations.

7. The provision on “Disclosure of Funding Pursuant to State Laws” in Section 10.6 of the Agreement is hereby amended such that the heading is restated in its entirety to read “Disclosure of Funding Pursuant to State/Federal Laws” and that two additional sentences shall be included at the end of such section as follows:

“Each Party will be responsible for reporting, as may be required by state or federal law, any of such Party’s respective spend to any covered recipient (as defined by the Physician Payment Sunshine Act or other similar state laws) which they make under this Agreement. In the event of a disagreement about which Party has reporting responsibility, the Parties shall discuss in good faith.

8. This Amendment is effective and shall become part of the Agreement as of the Amendment Effective Date.

9. Except as provided herein, all other terms and conditions of the Agreement remain unchanged and in full force and effect.

10. This Amendment may be signed in any number of counterparts (facsimile and electronic transmission included), each of which shall be deemed an original, but all of which shall constitute one and the same instrument. After facsimile or electronic transmission, the Parties agree to execute and exchange documents with original signature.

(Remainder of this page is left intentionally blank.)

RMS – Epizyme/Eisai

1st Amendment to CoDx Agr

Effective Date: 31 MAY 2013

Page 3 of 6

The Parties have executed this Amendment, by their duly authorized representatives.

ROCHE MOLECULAR SYSTEMS, INC.		EPIZYME, INC.
By:	/s/ Paul Brown	By:	/s/ Jason Rhodes
	(signature)		(signature)
Name:	Paul A. Brown	Name:	Jason Rhodes
	(printed name)		(printed name)
Title:	President and CEO	Title:	President and CFO
Date:	2013.10.13	Date:	10-4-13
		EISAI CO., LTD.
		By:	/s/ Kenichi Nomoto
			(signature)
		Name:	Kenichi Nomoto
			(printed name)
		Title:	President, Oncology PCU
		Date:	10-23-2013

RMS – Epizyme/Eisai

1st Amendment to CoDx Agr

Effective Date: 31 MAY 2013

Page 4 of 6

Page 5 of 6

EX-10.24

Exhibit 10.24

Certain identified information has been excluded from the exhibit because it is both (i) not material and (ii) is the type of information that the registrant treats as private or confidential. Double asterisks denote omissions.

SECOND AMENDMENT

TO

COMPANION DIAGNOSTICS AGREEMENT

This Second Amendment (“Second Amendment”) shall be effective as of this 16th day of November (“Amendment Effective Date”), by and between Epizyme, Inc., having a place of business at 400 Technology Square, 4th Floor, Cambridge, Massachusetts 02139, U.S.A. (“Epizyme”) and Eisai Co., Ltd., having a place of business at Koishikawa 4-6-10, Bunkyo-ku, Tokyo 112-8088, Japan (individually, “Eisai” and collectively with Epizyme, “Pharmaceutical Partners”), on the one side, and Roche Molecular Systems, Inc., having a place of business at 4300 Hacienda Drive, Pleasanton, California 94588, U.S.A. (“RMS”), on the other side, as an amendment to the Companion Diagnostics Agreement, dated 18th December 2012 as previously amended on 31 May 2013 (“Agreement”). Capitalized terms used in this Amendment and not defined in this Amendment shall have the meanings ascribed to them in the Agreement.

WHEREAS, Epizyme, Eisai and RMS are Parties to the Agreement and desire to amend the Agreement as set forth in this Second Amendment; and

WHEREAS, the Parties agree to modify the Project Plan and the Payment Plan, as well as the other provisions specifically set forth herein, in accordance with Section 4.2 of the Agreement, to reflect the revised timing of the Pivotal Registrational Trial.

NOW, THEREFORE, in consideration of the agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which each Party hereby acknowledges, the Parties hereby agree as follows:

1. Section 15.7(b) under the Agreement is hereby replaced in its entirety with the following amended and restated Section 15.7(b):

“(b) If Pharmaceutical Partners terminate this Agreement or a Project Plan pursuant to Section 15.4, and RMS is not in material breach of this Agreement, then the Parties shall agree [**] and Pharmaceutical Partners shall pay to RMS [**]. If the Parties cannot agree [**], the Parties agree that such disputes shall be resolved by Senior Officers in accordance with Section 4.3, and then, if applicable, by Arbitration in accordance with Article 16. Without limiting the foregoing, (i) in the event that such termination occurs prior to initiation of [**], Pharmaceutical Partners shall pay to RMS [**] dollars ($[**]), and (ii) in the event that such termination occurs after initiation of [**], Pharmaceutical Partners shall pay to RMS [**] dollars ($[**]) (either the fees in (i) or (ii), the “Deferred Fee”); provided that, for clarity, in the event that Pharmaceutical Partners are obligated to make a payment for Deferred Fee to RMS pursuant to clause (ii), they shall not also be obligated to make a payment for Deferred Fee to RMS pursuant to clause (i). Any applicable Deferred Fee in addition to any applicable [**] that may be due as set forth above in this Section 15.7(b) shall be collectively the “Termination Fees”. In addition, Pharmaceutical Partners shall pay to RMS and any additional costs associated with the agreed upon orderly wind down of any then-ongoing activities under the Project Plan. For clarity, (1) for purposes of calculating the Termination Fees (if any) due to RMS pursuant to this Section 15.7(b) only, the milestone reference amounts set forth on Part I.B of Exhibit E shall apply, (2) for purposes of any milestones that have been completed prior to termination (which were not invoiced and/or paid), such milestones shall be

Page1of 8

deemed earned and the milestone amounts set forth in Exhibit B shall apply and be paid in accordance with Article 7; and, unless otherwise expressly agreed by the Parties in writing, in no event shall Pharmaceutical Partners be obligated to pay RMS more than an aggregate of fifteen million dollars ($15,000,000) following the execution of the Second Amendment to this Agreement in milestones and Termination Fees under this Agreement. For illustrative purposes only, Part II of Exhibit E provides a sample calculation for a scenario under this Section 15.7(b).”

2. The current Project Plan under the Agreement is hereby replaced in its entirety with the amended and restated Project Plan set forth in Attachment 1 to this Amendment.

3. The current Exhibit B of the Agreement is hereby replaced in its entirety with the amended and restated Exhibit B set forth in Attachment 2 to this Amendment.

4. The current Exhibit C of the Agreement is hereby replaced in its entirety with the amended and restated Exhibit C set forth in Attachment 3 to this Amendment.

5. The current Exhibit E of the Agreement is hereby replaced in its entirety with the amended and restated Exhibit E set forth in Attachment 4 to this Amendment.

6. This Amendment is effective and shall become part of the Agreement as of the Amendment Effective Date.

7. Except as provided herein, all other terms and conditions of the Agreement remain unchanged and are in full force and effect.

8. This Amendment may be signed in any number of counterparts (facsimile and electronic transmission included), each of which shall be deemed an original, but all of which shall constitute one and the same instrument. After facsimile or electronic transmission, the Parties agree to execute and exchange documents with original signature.

Page2of 8

The Parties have executed this Amendment, by their duly authorized representatives.

ROCHE MOLECULAR SYSTEMS, INC.		EPIZYME, INC.
By:	/s/ Paul Brown	By:	/s/ Robert Bazemore
	(signature)		(signature)
Name:	Paul Brown	Name:	Robert Bazemore
	(printed name)		(printed name)
Title:	President & CEO	Title:	President & CEO
Date:	8 December 2015	Date:	11-16-15
		EISAI CO., LTD.
		By:	/s/ Terushige Iike
			(signature)
		Name:	Terushige Iike
			(printed name)
		Title:	Chief Product Creation Officer
		Date:	December 15, 2015

Page3of 8

ATTACHMENT #2

EXHIBIT B

PAYMENT PLAN

Milestones: Epizyme, on behalf of Epizyme and Eisai, will pay RMS the following milestone payments upon completion of activities associated with the milestone:

I. Milestone payments made prior to the execution of the Second Amendment to this Agreement:

Milestone	Payment
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]

II. Milestone payment to be paid by Epizyme, on behalf of Epizyme and Eisai, to RMS within [**] days after the execution of the Second Amendment to this Agreement:

[**] [**]

III. Remaining milestone payments that may become payable after the execution of the Second Amendment to this Agreement:

[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]

Page4of 8

[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]

In the event that RMS has completed [**] Project Plan and thereafter any excessive delay or failure of performance by Pharmaceutical Partners prevents RMS from filing and therefore obtaining Regulatory Approval thereof in the United States, where RMS would otherwise have earned such subsequent milestone(s) but for such excessive delay or failure of performance by Pharmaceutical Partners, then RMS may send a notice to Pharmaceutical Partners asserting that such circumstances exist. If Pharmaceutical Partners do not either send RMS a notice of termination pursuant to Article 15 or a notice disputing the existence of such circumstances within [**] days after the notice from RMS asserting such circumstances, and if RMS is not in material breach of the Agreement, RMS shall be deemed to have earned [**] dollars ($[**]), which amount shall be creditable against all unearned milestones and Termination Fees, if any. Any dispute as to the applicability of this paragraph shall be resolved in accordance with the terms of Article 16. For clarity, unless otherwise expressly agreed by the Parties in writing, in no event shall Pharmaceutical Partners be obligated to pay RMS more than an aggregate of fifteen million dollars ($15,000,000) ) following the execution of the Second Amendment to this Agreement in milestones (including any amount that may become payable pursuant to this paragraph) and Termination Fees under this Agreement.

Page5of 8

ATTACHMENT #4

EXHIBIT E

MILESTONES AND EXAMPLES FOR SECTION 15.7(b)

Part I.A: Milestone Reference Amounts No Longer Applicable for Purposes of Section 15.7(b) After the Execution of the Second Amendment to the Agreement

Milestone	Payment
[**]	[**]
[**]	[**]
[**]	[**]

Part I.B: Milestone Reference Amounts Applicable for Purposes of Section 15.7(b) After the Execution of the Second Amendment to the Agreement

[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]
[**]	[**]

Part II: Sample Calculation under Section 15.7(b) (for illustrative purposes only)

[**]

Page6of 8

EX-10.43

Exhibit 10.43

CONSULTING AGREEMENT

THIS CONSULTING AGREEMENT (the “Agreement”) is entered into as of October 1, 2021 by and between Epizyme, Inc. (the “Company”), and Victoria Vakiener (“Ms. Vakiener” or “you”) (together, the “Parties”).

WHEREAS, Ms. Vakiener has served as the Chief Commercial Officer of the Company. And, WHEREAS the Chief Commercial Officer position has been eliminated by the Company. Consequently, Ms. Vakiener’ s last date of employment with the Company will be September 30, 2021;

WHEREAS, the Company desires to engage Ms. Vakiener as a consultant to the Company immediately following the effectiveness of her resignation; and

WHEREAS, Ms. Vakiener has agreed to provide such services pursuant to the terms and conditions set forth in this Agreement.

NOW, THEREFORE in consideration of the mutual covenants and promises contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the Parties hereto, the Parties agree as follows:

1.Services To Be Performed. Commencing upon October 1, 2021 (the “Effective Date”) and continuing for the duration of the Consultation Period (as defined below), Ms. Vakiener agrees to perform such consulting, advisory and related services to and for the Company as may be reasonably requested from time to time by the Company (the “Services”), including with respect to questions and inquiries regarding commercialization plans for Tazverik and SETD-2. Ms. Vakiener agrees to use her best efforts in the performance of the Services and agrees to cooperate with the Company’s personnel, not to interfere with the conduct of the Company’s business, and to observe all Company rules, policies, regulations and security requirements with respect to the safety and safeguarding of persons and property.

2.Term. This Agreement shall commence upon the Effective Date and shall continue until March 31, 2022 (such period, as it may be extended upon mutual agreement of the Parties, being referred to as the “Consultation Period”), unless sooner terminated in accordance with the provisions of Section 5.

3.Consulting Benefits. The Company will provide Ms. Vakiener with the payments and benefits set forth below during the Consultation Period (the “Consulting Benefits”).

(a)Fees. The Company will pay Ms. Vakiener during the Consultation Period fees at a rate of $20,833 per month (the “Fees”), which Fees shall be (i) reduced by all applicable taxes and withholdings as determined by the Company in its sole discretion, (ii) paid to Ms. Vakiener in accordance with the Company’s regular payroll practices and (iii) subject to a pro rata adjustment for any partial calendar month. Notwithstanding the foregoing, the Company shall not pay any Fees to Ms. Vakiener earlier than the date eight (8) days after Ms. Vakiener’s timely execution, return and non-revocation of a release of claims in a form satisfactory to the Company (the “Release of Claims”).

1

(b)Stock Options. The Company acknowledges that (i) the stock options held by Ms. Vakiener as of the date hereof (the “Options”) shall continue to vest in accordance with their terms for so long as this Agreement continues to remain in effect, such that any Options that are not vested as of the date of termination or expiration of this Agreement shall be terminated and cancelled as of such date and (ii) Ms. Vakiener’s right to exercise the Options will terminate three months after the date Ms. Vakiener ceases to be an “Eligible Participant” (as defined in the option agreements evidencing the Options), provided that in the case of clause (ii) the Options may not be exercised after the Final Exercise Date (as defined in the option agreements evidencing the Options) or at all if, under the terms of the Options, Ms. Vakiener’s rights to exercise the Options would have otherwise terminated immediately.

(c)Reimbursement of Expenses. The Company shall reimburse Ms. Vakiener for all reasonable, necessary and approved travel expenses incurred or paid by Ms. Vakiener in connection with, or related to, the performance of the Services under this Agreement. Ms. Vakiener shall submit to the Company itemized monthly statements, in a form satisfactory to the Company, of such expenses incurred in the previous month. The Company shall pay to Ms. Vakiener approved amounts shown on each such statement within 30 days after receipt thereof. Notwithstanding the foregoing, Ms. Vakiener shall not incur total expenses in excess of $500.00 per month without the prior written approval of the Company.

(d)No Additional Consulting Benefits. Ms. Vakiener agrees that she shall provide the Services in exchange for the Consulting Benefits described in this Section 3 and that she is not entitled to any benefits, coverages or privileges, including, without limitation, social security, unemployment, medical or pension payments, made available to employees of the Company or any other consideration or benefits from the Company for the performance of the Services.

4.Independent Contractor. It is the express intention of the Parties that Ms. Vakiener shall be an independent contractor and not an employee, agent, joint venturer or partner of the Company for any purposes whatsoever.

(a)Performance of Services. Ms. Vakiener shall have the right to control and determine the methods, manner and means of performing the Services. In performing the Services, the amount of time devoted by Ms. Vakiener on any given day will be entirely within Ms. Vakiener’s control, and the Company will rely on Ms. Vakiener to put in the amount of time as is necessary to fulfill the requirements of this Agreement. However, the Services contemplated by this Agreement must meet the Company’s standards and approval and shall be subject to the Company’s general right of inspection and supervision to secure their satisfactory completion. Ms. Vakiener will provide all equipment and supplies required to perform the Services.

(b)Non-Exclusivity. Ms. Vakiener retains the right to contract with other companies or entities for full or part time employment or consulting services, without restriction, provided, however, that Ms. Vakiener remains in compliance with the terms of the Employee Invention and Non-Disclosure Agreement that she previously executed for the benefit of the Company and which remains in full force and effect (the “Restrictive Covenant Agreement”). Likewise, the Company retains a reciprocal right to contract with other companies and/or individuals for consulting services without restriction.

2

(c)Scope of Authority. Ms. Vakiener is not authorized to transact business, incur obligations, sell goods, receive payments, solicit orders or assign or create any obligation of any kind, express or implied, on behalf of the Company or any of the Company’s related or affiliated entities, or to bind in any way whatsoever, or to make any promise, warranty or representation on behalf of the Company or any of the Company’s related or affiliated entities with respect to any matter, without the prior written approval of the Company. Ms. Vakiener shall not use the Company’s trade names, trademarks, service names or service marks without the prior written approval of the Company.

5.Termination. This Agreement may be terminated prior to the end of the Consultation Period in the following manner: (a) by the Company at any time immediately upon written notice if Ms. Vakiener has materially breached, as determined by the Company in its discretion based on credible evidence, this Agreement, the Release of Claims or the Restrictive Covenant Agreement; (b) by Ms. Vakiener at any time immediately upon written notice if the Company has materially breached this Agreement (c) by Ms. Vakiener upon not less than thirty (30) days’ prior written notice for any reason; or (d) at any time upon the mutual written consent of the Parties hereto. Notwithstanding the foregoing, and for the avoidance of doubt, the Company may terminate this Agreement effective immediately by giving written notice to Ms. Vakiener if Ms. Vakiener fails to sign the Release of Claims by October 21, 2021 or revokes the Release of Claims within seven (7) days after signing it as set forth in the Release of Claims. In the event of any termination, Ms. Vakiener shall be entitled only to reimbursements for expenses incurred in accordance with Section 3(c) prior to termination, and no further payments of any kind will be due. In addition, vesting of any equity awards held by Ms. Vakiener, including the Options, to the extent then outstanding, will cease immediately upon termination. Any written notice under this Section 5 shall explain the reason for the termination.

6.Proprietary Information and Inventions.

6.1 Proprietary Information.

(a)Ms. Vakiener acknowledges that her relationship with the Company is one of high trust and confidence and that in the course of her service to the Company, Ms. Vakiener will continue to have access to and contact with Proprietary Information (as defined below). Ms. Vakiener will not disclose any Proprietary Information to any person or entity other than employees of the Company or use the same for any purposes (other than in the performance of the Services) without written approval by an officer of the Company, either during or after the Consultation Period, unless and until such Proprietary Information has become public knowledge without fault by Ms. Vakiener.

(b)For purposes of this Agreement, Proprietary Information shall mean, by way of illustration and not limitation, all information, whether or not in writing, whether or not patentable and whether or not copyrightable, of a private, secret or confidential nature, owned, possessed or used by the Company, concerning the Company’s business, business relationships or financial affairs, including, without limitation, any Invention, formula, vendor information, customer information, apparatus, equipment, trade secret, process, research, report, technical or research data, clinical data, know-how, computer program, software, software documentation, hardware design, technology, product, processes, methods, techniques, formulas, compounds,

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projects, developments, marketing or business plan, forecast, unpublished financial statement, budget, license, price, cost, customer, supplier or personnel information or employee list that is communicated to, learned of, developed or otherwise acquired by Ms. Vakiener in the course of her performance as a consultant to the Company.

(c)Ms. Vakiener agrees that all files, documents, letters, memoranda, reports, records, data sketches, drawings, models, laboratory notebooks, program listings, computer equipment or devices, computer programs or other written, photographic, or other tangible material containing Proprietary Information, whether created by Ms. Vakiener or others, which shall come into Ms. Vakiener’s custody or possession, shall be and are the exclusive property of the Company to be used by Ms. Vakiener only in the performance of her duties for the Company and shall not be copied or removed from the Company premises except in the pursuit of the business of the Company. All such materials or copies thereof and all tangible property of the Company in the custody or possession of Ms. Vakiener shall be delivered to the Company, upon the earlier of (i) a request by the Company or (ii) the termination of this Agreement. After such delivery, Ms. Vakiener shall not retain any such materials or copies thereof or any such tangible property.

(d)Ms. Vakiener agrees that her obligation not to disclose or to use information and materials of the types set forth in paragraphs (b) and (c) above, and Ms. Vakiener’s obligation to return materials and tangible property set forth in paragraph (c) above extends to such types of information, materials and tangible property of customers of the Company or suppliers to the Company or other third parties who may have disclosed or entrusted the same to the Company or to Ms. Vakiener.

(e)Ms. Vakiener acknowledges that the Company from time to time may have agreements with other persons or with the United States Government, or agencies thereof, that impose obligations or restrictions on the Company regarding inventions made during the course of work under such agreements or regarding the confidential nature of such work. Ms. Vakiener agrees to be bound by all such obligations and restrictions that are known to Ms. Vakiener and to take all action necessary to discharge the obligations of the Company under such agreements.

(f)Ms. Vakiener’s obligations under this Section 6.1 shall not apply to any information that (i) is or becomes known to the general public under circumstances involving no breach by Ms. Vakiener or others of the terms of this Section 6.1, (ii) is generally disclosed to third parties by the Company without restriction on such third parties, or (iii) is approved for release by written authorization of an officer of the Company. Further, nothing herein prohibits Ms. Vakiener from communicating with government agencies about possible violations of federal, state, or local laws or otherwise providing information to government agencies or participating in government agency investigations or proceedings. In addition, notwithstanding Ms. Vakiener’s confidentiality and nondisclosure obligations, Ms. Vakiener is hereby advised as follows pursuant to the Defend Trade Secrets Act: “An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that (A) is made (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. An individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade

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secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (A) files any document containing the trade secret under seal; and (B) does not disclose the trade secret, except pursuant to court order.”

6.2 Inventions.

(a)Ms. Vakiener will make full and prompt disclosure to the Company of all inventions, creations, improvements, enhancements, designs, innovations, discoveries, processes, methods, techniques, developments, software, computer programs, and works of authorship, whether or not patentable and whether or not copyrightable, that are created, made, conceived or reduced to practice by Ms. Vakiener or under her direction or jointly with others (i) during the Consultation Period if made for the Company in the course of the performance of the Services hereunder or (ii) during or after the Consultation Period if resulting or derived from Proprietary Information, whether or not during normal working hours or on the premises of the Company (all of which are collectively referred to in this Agreement as “Inventions”). Ms. Vakiener agrees to assign and does hereby assign to the Company (or any person or entity designated by the Company) all of Ms. Vakiener’s right, title and interest in and to all Inventions and all related patents, patent applications, copyrights created in the work(s) of authorship, trademarks, trade names, and other industrial and intellectual property rights and applications therefor in the United States and elsewhere. However, clause (i) of this subsection (a) shall not apply to Inventions that do not relate to the present or planned business or research and development of the Company and that are made and conceived by Ms. Vakiener not during normal working hours, not on the Company’s premises and not using the Company’s tools, devices, equipment or Proprietary Information. Ms. Vakiener understands that, to the extent this Agreement shall be construed in accordance with the laws of any state that precludes a requirement that an individual assign certain classes of inventions, this Section 6.2(a) shall be interpreted not to apply to any invention that a court rules and/or the Company agrees falls within such classes. Ms. Vakiener further acknowledges that each original work of authorship that is made by Ms. Vakiener (solely or jointly with others) within the scope of the Agreement and which is protectable by copyright is a “work made for hire,” as that term is defined in the United States Copyright Act. Ms. Vakiener hereby waives all claims to moral rights in any Inventions.

(b)Ms. Vakiener agrees that if, in the course of performing the Services, she incorporates into any Invention developed under this Agreement any preexisting invention, improvement, development, concept, discovery or other proprietary information owned by Ms. Vakiener or in which Ms. Vakiener has an interest (“Prior Inventions”), (i) Ms. Vakiener will inform the Company, in writing before incorporating such Prior Inventions into any Invention, and (ii) the Company is hereby granted a nonexclusive, royalty-free, perpetual, irrevocable, transferable worldwide license with the right to grant and authorize sublicenses, to make, have made, modify, use, import, offer for sale, sell, reproduce, distribute, modify, adapt, prepare derivative works of, display, perform, and otherwise exploit such Prior Inventions, without restriction, including, without limitation, as part of or in connection with such Invention, and to practice any method related thereto. Ms. Vakiener shall not incorporate any invention, improvement, development, concept, discovery or other proprietary information owned by any third party into any Invention without the Company’s prior written permission.

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(c)Ms. Vakiener agrees to cooperate fully with the Company, both during and after the Consultation Period, with respect to the procurement, maintenance, and enforcement of copyrights, patents and other intellectual property rights (both in the United States and foreign countries) relating to Inventions. Ms. Vakiener shall sign all papers, including, without limitation, copyright applications, patent applications, declarations, oaths, formal assignments, assignments of priority rights, and powers of attorney, which the Company may deem necessary or desirable in order to protect its rights and interests in any Invention. Ms. Vakiener further agrees that if the Company is unable, after reasonable effort, to secure the signature of Ms. Vakiener on any such papers, any executive officer of the Company shall be entitled to execute any such papers as the agent and the attorney-in-fact of Ms. Vakiener, and Ms. Vakiener hereby irrevocably designates and appoints each executive officer of the Company as Ms. Vakiener’s agent and attorney-in-fact to execute any such papers on Ms. Vakiener’s behalf, and to take any and all actions as the Company may deem necessary or desirable in order to protect its rights and interests in any Invention, under the conditions described in this sentence.

(d)Ms. Vakiener shall maintain adequate and current written records (in the form of notes, sketches, drawings and as may be specified by the Company) to document the conception and/or first actual reduction to practice of any Invention. Such written records shall be available to and remain the sole property of the Company at all times.

7.Other Agreements. Ms. Vakiener hereby represents that, except as Ms. Vakiener has disclosed in writing to the Company, Ms. Vakiener is not bound by the terms of any agreement with any third party to refrain from using or disclosing any trade secret or confidential or proprietary information in the course of her consultancy with the Company, to refrain from competing, directly or indirectly, with the business of such third party or to refrain from soliciting employees, customers or suppliers of such third party. Ms. Vakiener further represents that her performance of all the terms of this Agreement and the performance of the Services as a consultant to the Company do not and will not breach any agreement with any third party to which Ms. Vakiener is a party (including without limitation any nondisclosure or noncompetition agreement), and that Ms. Vakiener will not disclose to the Company or induce the Company to use any confidential or proprietary information or material belonging to any current or previous employer or others.

8.Warranties. Ms. Vakiener will assume sole responsibility for her compliance with applicable federal and state laws and regulations, and shall rely exclusively upon her own determination, or that of her legal advisers, that the performance of the Services and the receipt of the Consulting Benefits hereunder comply with such laws and regulations. Ms. Vakiener shall be solely responsible for all state and federal income taxes, unemployment insurance and social security taxes in connection with this Agreement and for maintaining adequate workers’ compensation insurance coverage. Ms. Vakiener acknowledges that she is not relying upon the advice or representation of the Company with respect to the tax treatment of the Consulting Benefits.

9.Non-Assignability of Contract. This Agreement shall be binding upon, and inure to the benefit of, both parties and their respective successors and assigns, including any entity with

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which, or into which, the Company may be merged or which may succeed to its assets or business, provided, however, that the obligations of Ms. Vakiener are personal and shall not be assigned by her.

10.Notices. All notices required or permitted under this Agreement shall be in writing and shall be deemed effective upon personal delivery or upon deposit in the United States Post Office, by registered or certified mail, postage prepaid, addressed to the other party at such address or addresses as either party shall designate to the other.

11.Complete Agreement. Ms. Vakiener acknowledges that this Agreement, together with the Release of Claims, the Restrictive Covenant Agreement and the option agreements evidencing the Options, contains the entire understanding between the Parties and supersedes, replaces and takes precedence over any prior understanding or oral or written agreement between the Parties respecting the subject matter of this Agreement, the Release of Claims or the Options. There are no representations, agreements, arrangements, nor understandings, oral or written, between the Parties relating to the subject matter of this Agreement that are not fully expressed herein and in the Release of Claims.

12.Severability. In the event any provision of this Agreement shall be held invalid, the same shall not invalidate or otherwise affect in any respect any other term or terms of this Agreement, which term or terms shall remain in full force and effect.

13.Non-Waiver. No delay or omission by the Company in exercising any right under this Agreement shall operate as a waiver of that or any other right. A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed as a bar to or waiver of any right on any other occasion.

14.Amendment. This Agreement may be amended or modified only by a written instrument executed by both the Company and Ms. Vakiener.

15.Counterparts. This Agreement may be executed in two (2) signed counterparts, each of which shall constitute an original, but all of which taken together shall constitute one and the same instrument.

16.Interpretation. Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns and pronouns shall include the plural, and vice versa. The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.

17.Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the internal laws of the Commonwealth of Massachusetts without giving effect to any choice or conflict of law provision or rule (whether of the Commonwealth of Massachusetts or any other jurisdiction) that would cause the application of laws of any jurisdictions other than those of the Commonwealth of Massachusetts.

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date and year first above written.

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EPIZYME, INC.

By: /s/ Grant Bogle

Name: Grant Bogle
Title: Chief Executive Officer

Victoria Vakiener

/s/ Victoria Vakiener
Victoria Vakiener

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EX-10.44

Exhibit 10.44

CONSULTING AGREEMENT

THIS CONSULTING AGREEMENT (the “Agreement”) is entered into as of October 27, 2021 by and between Epizyme, Inc. (the “Company”), and Matthew Ros (“Mr. Ros” or “you”) (together, the “Parties”).

WHEREAS, Mr. Ros has served as the Executive Vice President, Chief Strategy and Business Officer of the Company;

WHEREAS the Executive Vice President, Chief Strategy and Business Officer position has been eliminated by the Company and consequently, Mr. Ros’ last date of employment with the Company will be October 31, 2021;

WHEREAS, the Company desires to engage Mr. Ros as a consultant to the Company effective immediately following his last date of employment with the Company; and

WHEREAS, Mr. Ros has agreed to provide such services pursuant to the terms and conditions set forth in this Agreement.

NOW, THEREFORE in consideration of the mutual covenants and promises contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the Parties hereto, the Parties agree as follows:

1.Services To Be Performed. Commencing upon November 1, 2021 (the “Effective Date”) and continuing for the duration of the Consultation Period (as defined below), Mr. Ros agrees to perform such consulting, advisory and related services to and for the Company as may be reasonably requested from time to time by the Company (the “Services”) and which are further described in part at Exhibit A, attached and incorporated by reference herein. Mr. Ros agrees to use his best efforts in the performance of the Services and agrees to cooperate with the Company’s personnel, not to interfere with the conduct of the Company’s business, and to observe all Company rules, policies, regulations and security requirements with respect to the safety and safeguarding of persons and property.

2.Term. This Agreement shall commence upon the Effective Date and shall continue until March 31, 2022 (such period, as it may be extended upon mutual agreement of the Parties, being referred to as the “Consultation Period”), unless sooner terminated in accordance with the provisions of Section 5.

3.Consulting Benefits. The Company will provide Mr. Ros with the payments and benefits set forth below during the Consultation Period (the “Consulting Benefits”).

(a)Fees. The Company will pay Mr. Ros during the Consultation Period fees at a rate of $12,000.00 per month (the “Fees”), which Fees shall be (i) reduced by all applicable taxes and withholdings as determined by the Company in its sole discretion, (ii) paid to Mr. Ros in accordance with the Company’s regular payroll practices and (iii) subject to a pro rata adjustment for any partial calendar month. Notwithstanding the foregoing, the Company shall not pay any Fees to Mr. Ros earlier than the date eight (8) days after Mr. Ros’ timely

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execution, return and non-revocation of a release of claims in a form satisfactory to the Company (the “Release of Claims”).

(b)Stock Options and Restricted Stock Units. The Company acknowledges that (i) the stock options and restricted stock units held by Mr. Ros as of the date hereof (respectively, the “Options” and the “Restricted Stock Units”) shall continue to vest in accordance with their terms for so long as this Agreement continues to remain in effect, such that any Options or Restricted Stock Units that are not vested as of the date of termination or expiration of this Agreement shall be terminated and cancelled as of such date and (ii) Mr. Ros’ right to exercise the Options will terminate three months after the date Mr. Ros ceases to be an “Eligible Participant” (as defined in the option agreements evidencing the Options), provided that in the case of clause (ii) the Options may not be exercised after the Final Exercise Date (as defined in the option agreements evidencing the Options) or at all if, under the terms of the Options, Mr. Ros ‘rights to exercise the Options would have otherwise terminated immediately.

(c)Reimbursement of Expenses. The Company shall reimburse Mr. Ros for all reasonable, necessary and approved travel expenses incurred or paid by Mr. Ros in connection with, or related to, the performance of the Services under this Agreement. Mr. Ros shall submit to the Company itemized monthly statements, in a form satisfactory to the Company, of such expenses incurred in the previous month. The Company shall pay to Mr. Ros approved amounts shown on each such statement within 30 days after receipt thereof. Notwithstanding the foregoing, Mr. Ros shall not incur total expenses in excess of $500.00 per month without the prior written approval of the Company.

(d)No Additional Consulting Benefits. Mr. Ros agrees that he shall provide the Services in exchange for the Consulting Benefits described in this Section 3 and that he is not entitled to any benefits, coverages or privileges, including, without limitation, social security, medical or pension payments, made available to employees of the Company or any other consideration or benefits from the Company for the performance of the Services.

(e)

4.Independent Contractor. It is the express intention of the Parties that Mr. Ros shall be an independent contractor and not an employee, agent, joint venturer or partner of the Company for any purposes whatsoever.

(a)Performance of Services. Mr. Ros shall have the right to control and determine the methods, manner and means of performing the Services. In performing the Services, the amount of time devoted by Mr. Ros on any given day will be entirely within Mr. Ros’ control, and the Company will rely on Mr. Ros to put in the amount of time as is necessary to fulfill the requirements of this Agreement. However, the Services contemplated by this Agreement must meet the Company’s standards and approval and shall be subject to the Company’s general right of inspection and supervision to secure their satisfactory completion. Mr. Ros will provide all equipment and supplies required to perform the Services.

(b)Non-Exclusivity. Subject to the completion of the Services described in Section 1 above, as well as Exhibit A, Mr. Ros retains the right to contract with other companies or entities for full or part time employment and/or consulting services, without restriction, provided, however, that Mr. Ros remains in compliance with the terms of the Employee Invention and Non-Disclosure Agreement that he previously executed for the benefit

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of the Company and which remains in full force and effect (the “Restrictive Covenant Agreement”). Likewise, the Company retains a reciprocal right to contract with other companies and/or individuals for consulting services without restriction.

(c)Scope of Authority. Mr. Ros is not authorized to transact business, incur obligations, sell goods, receive payments, solicit orders or assign or create any obligation of any kind, express or implied, on behalf of the Company or any of the Company’s related or affiliated entities, or to bind in any way whatsoever, or to make any promise, warranty or representation on behalf of the Company or any of the Company’s related or affiliated entities with respect to any matter, without the prior written approval of the Company. Mr. Ros shall not use the Company’s trade names, trademarks, service names or service marks without the prior written approval of the Company.

5.Termination. This Agreement may be terminated prior to the end of the Consultation Period in the following manner: (a) by the Company at any time immediately upon written notice if Mr. Ros has materially breached, as determined by the Company in its discretion based on credible evidence, this Agreement, the Release of Claims or the Restrictive Covenant Agreement. Any dispute, controversy, or claim arising out of or relating to this Clause 5(a) of the Consulting Agreement shall be settled by binding arbitration administered by the American Arbitration Association under its Employment Arbitration Rules and Mediation Procedures and judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof; (b) by Mr. Ros at any time immediately upon written notice if the Company has materially breached this Agreement; (c) by Mr. Ros upon not less than thirty (30) days ‘prior written notice for any reason; or (d) at any time upon the mutual written consent of the Parties hereto. Notwithstanding the foregoing, and for the avoidance of doubt, the Company may terminate this Agreement effective immediately by giving written notice to Mr. Ros if Mr. Ros fails to sign the Release of Claims by December 15, 2021 or revokes the Release of Claims within seven (7) days after signing it as set forth in the Release of Claims. In the event of any termination, Mr. Ros shall be entitled only to reimbursements for expenses incurred in accordance with Section 3(c) prior to termination, and no further payments of any kind will be due. In addition, vesting of any equity awards held by Mr. Ros, including the Options and Restricted Stock Units, to the extent then outstanding, will cease immediately upon termination.

6.Proprietary Information and Inventions.

6.1 Proprietary Information.

(a)Mr. Ros acknowledges that his relationship with the Company is one of high trust and confidence and that in the course of his service to the Company, Mr. Ros will continue to have access to and contact with Proprietary Information (as defined below). Mr. Ros will not disclose any Proprietary Information to any person or entity other than employees of the Company or use the same for any purposes (other than in the performance of the Services) without written approval by an officer of the Company, either during or after the Consultation Period, unless and until such Proprietary Information has become public knowledge without fault by Mr. Ros.

(b)For purposes of this Agreement, Proprietary Information shall mean, by way of illustration and not limitation, all information, whether or not in writing, whether or not

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patentable and whether or not copyrightable, of a private, secret or confidential nature, owned, possessed or used by the Company, concerning the Company’s business, business relationships or financial affairs, including, without limitation, any Invention, formula, vendor information, customer information, apparatus, equipment, trade secret, process, research, report, technical or research data, clinical data, know-how, computer program, software, software documentation, hardware design, technology, product, processes, methods, techniques, formulas, compounds, projects, developments, marketing or business plan, forecast, unpublished financial statement, budget, license, price, cost, customer, supplier or personnel information or employee list that is communicated to, learned of, developed or otherwise acquired by Mr. Ros in the course of his performance as a consultant to the Company.

(c)Mr. Ros agrees that all files, documents, letters, memoranda, reports, records, data sketches, drawings, models, laboratory notebooks, program listings, computer equipment or devices, computer programs or other written, photographic, or other tangible material containing Proprietary Information, whether created by Mr. Ros or others, which shall come into Mr. Ros’s custody or possession, shall be and are the exclusive property of the Company to be used by Mr. Ros only in the performance of his duties for the Company and shall not be copied or removed from the Company premises except in the pursuit of the business of the Company. All such materials or copies thereof and all tangible property of the Company in the custody or possession of Mr. Ros shall be delivered to the Company, upon the earlier of (i) a request by the Company or (ii) the termination of this Agreement. After such delivery, Mr. Ros shall not retain any such materials or copies thereof or any such tangible property.

(d)Mr. Ros agrees that his obligation not to disclose or to use information and materials of the types set forth in paragraphs (b) and (c) above, and Mr. Ros’s obligation to return materials and tangible property set forth in paragraph (c) above extends to such types of information, materials and tangible property of customers of the Company or suppliers to the Company or other third parties who may have disclosed or entrusted the same to the Company or to Mr. Ros.

(e)Mr. Ros acknowledges that the Company from time to time may have agreements with other persons or with the United States Government, or agencies thereof, that impose obligations or restrictions on the Company regarding inventions made during the course of work under such agreements or regarding the confidential nature of such work. Mr. Ros agrees to be bound by all such obligations and restrictions that are known to Mr. Ros and to take all action necessary to discharge the obligations of the Company under such agreements.

(f)Mr. Ros’ obligations under this Section 6.1 shall not apply to any information that (i) is or becomes known to the general public under circumstances involving no breach by Mr. Ros or others of the terms of this Section 6.1, (ii) is generally disclosed to third parties by the Company without restriction on such third parties, or (iii) is approved for release by written authorization of an officer of the Company. Further, nothing herein prohibits Mr. Ros from communicating with government agencies about possible violations of federal, state, or local laws or otherwise providing information to government agencies or participating in government agency investigations or proceedings. In addition, notwithstanding Mr. Ros’ confidentiality and nondisclosure obligations, Mr. Ros is hereby advised as follows pursuant to the Defend Trade Secrets Act: “An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that (A) is made (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an

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attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. An individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (A) files any document containing the trade secret under seal; and (B) does not disclose the trade secret, except pursuant to court order.”

6.2 Inventions.

(a)Mr. Ros will make full and prompt disclosure to the Company of all inventions, creations, improvements, enhancements, designs, innovations, discoveries, processes, methods, techniques, developments, software, computer programs, and works of authorship, whether or not patentable and whether or not copyrightable, that are created, made, conceived or reduced to practice by Mr. Ros or under his direction or jointly with others (i) during the Consultation Period if made for the Company in the course of the performance of the Services hereunder or (ii) during or after the Consultation Period if resulting or derived from Proprietary Information, whether or not during normal working hours or on the premises of the Company (all of which are collectively referred to in this Agreement as “Inventions”). Mr. Ros agrees to assign and does hereby assign to the Company (or any person or entity designated by the Company) all of Mr. Ros’ right, title and interest in and to all Inventions and all related patents, patent applications, copyrights created in the work(s) of authorship, trademarks, trade names, and other industrial and intellectual property rights and applications therefor in the United States and elsewhere. However, clause (i) of this subsection (a) shall not apply to Inventions that do not relate to the present or planned business or research and development of the Company and that are made and conceived by Mr. Ros not during normal working hours, not on the Company’s premises and not using the Company’s tools, devices, equipment or Proprietary Information. Mr. Ros understands that, to the extent this Agreement shall be construed in accordance with the laws of any state that precludes a requirement that an individual assign certain classes of inventions, this Section 6.2(a) shall be interpreted not to apply to any invention that a court rules and/or the Company agrees falls within such classes. Mr. Ros further acknowledges that each original work of authorship that is made by Mr. Ros (solely or jointly with others) within the scope of the Agreement and which is protectable by copyright is a “work made for hire,” as that term is defined in the United States Copyright Act. Mr. Ros hereby waives all claims to moral rights in any Inventions.

(b)Mr. Ros agrees that if, in the course of performing the Services, he incorporates into any Invention developed under this Agreement any preexisting invention, improvement, development, concept, discovery or other proprietary information owned by Mr. Ros or in which Mr. Ros has an interest (“Prior Inventions”), (i) Mr. Ros will inform the Company, in writing before incorporating such Prior Inventions into any Invention, and (ii) the Company is hereby granted a nonexclusive, royalty-free, perpetual, irrevocable, transferable worldwide license with the right to grant and authorize sublicenses, to make, have made, modify, use, import, offer for sale, sell, reproduce, distribute, modify, adapt, prepare derivative works of, display, perform, and otherwise exploit such Prior Inventions, without restriction, including, without limitation, as part of or in connection with such Invention, and to practice any method related thereto. Mr. Ros shall not incorporate any invention, improvement, development,

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concept, discovery or other proprietary information owned by any third party into any Invention without the Company’s prior written permission.

(c)Mr. Ros agrees to cooperate fully with the Company, both during and after the Consultation Period, with respect to the procurement, maintenance, and enforcement of copyrights, patents and other intellectual property rights (both in the United States and foreign countries) relating to Inventions. Reasonable compensation for Mr. Ros for any post-Consultation Period engagement will be determined at such time. Mr. Ros shall sign all papers, including, without limitation, copyright applications, patent applications, declarations, oaths, formal assignments, assignments of priority rights, and powers of attorney, which the Company may deem necessary or desirable in order to protect its rights and interests in any Invention. Mr. Ros further agrees that if the Company is unable, after reasonable effort, to secure the signature of Mr. Ros on any such papers, any executive officer of the Company shall be entitled to execute any such papers as the agent and the attorney-in-fact of Mr. Ros, and Mr. Ros hereby irrevocably designates and appoints each executive officer of the Company as Mr. Ros’s agent and attorney-in-fact to execute any such papers on Mr. Ros’s behalf, and to take any and all actions as the Company may deem necessary or desirable in order to protect its rights and interests in any Invention, under the conditions described in this sentence.

(d)Mr. Ros shall maintain adequate and current written records (in the form of notes, sketches, drawings and as may be specified by the Company) to document the conception and/or first actual reduction to practice of any Invention. Such written records shall be available to and remain the sole property of the Company at all times.

7.Other Agreements. Mr. Ros hereby represents that, except as Mr. Ros has disclosed in writing to the Company, Mr. Ros is not bound by the terms of any agreement with any third party to refrain from using or disclosing any trade secret or confidential or proprietary information in the course of his consultancy with the Company, to refrain from competing, directly or indirectly, with the business of such third party or to refrain from soliciting employees, customers or suppliers of such third party. Mr. Ros further represents that his performance of all the terms of this Agreement and the performance of the Services as a consultant to the Company do not and will not breach any agreement with any third party to which Mr. Ros is a party (including without limitation any nondisclosure or non-competition agreement), and that Mr. Ros will not disclose to the Company or induce the Company to use any confidential or proprietary information or material belonging to any current or previous employer or others.

8.Warranties. Mr. Ros will assume sole responsibility for his compliance with applicable federal and state laws and regulations, and shall rely exclusively upon his own determination, or that of his legal advisers, that the performance of the Services and the receipt of the Consulting Benefits hereunder comply with such laws and regulations. Notwithstanding the terms of the above Paragraph 3(a) of this Agreement, Mr. Ros shall be solely responsible for all state and federal income taxes, unemployment insurance and social security taxes in connection with this Agreement and for maintaining adequate workers ’compensation insurance coverage. Mr. Ros acknowledges that he is not relying upon the advice or representation of the Company with respect to the tax treatment of the Consulting Benefits.

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9.Non-Assignability of Contract. This Agreement shall be binding upon, and inure to the benefit of, both parties and their respective successors and assigns, including any entity with which, or into which, the Company may be merged or which may succeed to its assets or business, provided, however, that the obligations of Mr. Ros are personal and shall not be assigned by him.

10.Notices. All notices required or permitted under this Agreement shall be in writing and shall be deemed effective upon personal delivery or upon deposit in the United States Post Office, by registered or certified mail, postage prepaid, addressed to the other party at such address or addresses as either party shall designate to the other.

11.Complete Agreement. Mr. Ros acknowledges that this Agreement, together with the Release of Claims, the Restrictive Covenant Agreement, the option agreements evidencing the Options and the restricted stock unit agreements evidencing the Restricted Stock Units, contains the entire understanding between the Parties and supersedes, replaces and takes precedence over any prior understanding or oral or written agreement between the Parties respecting the subject matter of this Agreement, the Release of Claims, the Options or the Restricted Stock Units. There are no representations, agreements, arrangements, nor understandings, oral or written, between the Parties relating to the subject matter of this Agreement that are not fully expressed herein or in the Release of Claims.

12.Severability. In the event any provision of this Agreement shall be held invalid, the same shall not invalidate or otherwise affect in any respect any other term or terms of this Agreement, which term or terms shall remain in full force and effect.

13.Non-Waiver. No delay or omission by the Company in exercising any right under this Agreement shall operate as a waiver of that or any other right. A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed as a bar to or waiver of any right on any other occasion.

14.Amendment. This Agreement may be amended or modified only by a written instrument executed by both the Company and Mr. Ros.

15.Counterparts. This Agreement may be executed in two (2) signed counterparts, each of which shall constitute an original, but all of which taken together shall constitute one and the same instrument.

16.Interpretation. Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns and pronouns shall include the plural, and vice versa. The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.

17.Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the internal laws of the Commonwealth of Massachusetts without giving effect to any choice or conflict of law provision or rule (whether of the Commonwealth of Massachusetts or any other jurisdiction) that would cause the application of laws of any jurisdictions other than those of the Commonwealth of Massachusetts.

7

8

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date and year first above written.

EPIZYME, INC.

By: /s/ Grant Bogle

Name: Grant Bogle

Title: Chief Executive Officer

/s/ Matthew Ros

Matthew Ros

9

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in the following Registration Statements:

1. Registration Statement (Form S-8 No. 333-189629) pertaining to the 2008 Stock Incentive Plan, 2013 Stock Incentive Plan, and 2013 Employee Stock Purchase Plan of Epizyme, Inc.,

2. Registration Statement (Form S-8 Nos. 333-194205, 333-236707 and 333-253383) pertaining to the 2013 Stock Incentive Plan and 2013 Employee Stock Purchase Plan of Epizyme, Inc.,

3. Registration Statement (Form S-8 Nos. 333-202681, 333-210028, 333-216638, 333-223612, and 333-229878) pertaining to the 2013 Stock Incentive Plan of Epizyme, Inc.,

4. Registration Statement (Form S-3 Nos. 333-255806 and 333-259680) and related Prospectus of Epizyme, Inc., and

of our reports dated March 1, 2022, with respect to the consolidated financial statements of Epizyme, Inc. and the effectiveness of internal control over financial reporting of Epizyme, Inc. included in this Annual Report (Form 10-K) of Epizyme, Inc. for the year ended December 31, 2021.

/s/ Ernst & Young LLP

Boston, Massachusetts

March 1, 2022

EX-31.1

Exhibit 31.1

I, Grant Bogle, certify that:

1. I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2021 of Epizyme, 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 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)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15 (f) and 15d-15(f)) 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 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 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.

Date: March 1, 2022

/s/ Grant Bogle

Grant Bogle

President and Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

I, Grant Bogle, certify that:

1. I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2021 of Epizyme, 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 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)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15 (f) and 15d-15(f)) 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 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 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.

Date: March 1, 2022

/s/ Grant Bogle

Grant Bogle

President and Chief Executive Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATIONS OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with this Annual Report on Form 10-K of Epizyme, Inc. (the “Company”) for the year ended December 31, 2021, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned officer of the Company hereby certifies, pursuant to 18 U.S.C. (section) 1350, as adopted pursuant to (section) 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: March 1, 2022

/s/ Grant Bogle

Grant Bogle

President and Chief Executive Officer

(Principal Executive Officer & Principal Financial Officer)

XML

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Feb. 24, 2022	Jun. 30, 2020
Cover [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2021
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	FY
Trading Symbol	EPZM
Security Exchange Name	NASDAQ
Entity File Number	001-35945
Title of 12(b) Security	Common stock, $0.0001 par value
Entity Registrant Name	EPIZYME, INC.
Entity Central Index Key	0001571498
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Document Annual Report	true
Document Transition Report	false
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
ICFR Auditor Attestation Flag	true
Entity Common Stock Shares Outstanding		164,482,036
Entity Public Float			$ 794.6
Entity Tax Identification Number	26-1349956
Entity Address, Address Line One	400 Technology Square
Entity Address, City or Town	Cambridge
Entity Address, State or Province	MA
Entity Incorporation, State or Country Code	DE
Entity Address, Postal Zip Code	02139
City Area Code	617
Local Phone Number	229-5872
Documents Incorporated by Reference	Portions of the registrant’s definitive proxy statement that the registrant intends to file with the Securities and Exchange Commission pursuant to Regulation 14A in connection with the registrant’s 2021 Annual Meeting of Stockholders are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent stated herein.
Auditor Name	Ernst & Young LLP
Auditor Location	Boston, Massachusetts
Auditor Firm ID	42

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 98,336	$ 168,215
Marketable securities	78,454	205,391
Accounts receivable, net	6,572	3,105
Inventory	3,216	10,461
Prepaid expenses and other current assets	19,465	17,921
Total current assets	206,043	405,093
Property and equipment, net	1,545	2,152
Operating lease assets	20,054	17,305
Intangible assets, net	42,849	47,002
Restricted cash and other assets	18,509	2,021
Total assets	289,000	473,573
Current liabilities:
Accounts payable	10,265	10,163
Accrued expenses	30,777	28,572
Current portion of operating lease obligation	4,154	4,665
Total current liabilities	45,196	43,400
Operating lease obligation, net of current portion	18,497	15,409
Deferred revenue, net of current portion	11,950	0
Related party long-term debt, net of debt discount	216,461	215,670
Warrants to purchase common stock	1,930	0
Other long-term liabilities	0	21
Related party liability related to sale of future royalties	15,654	14,176
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.0001 par value; 5,000 shares authorized; 338 shares and 350 shares issued and outstanding, respectively (equivalent to 3,378 shares and 3,500 shares of common stock, respectively, upon conversion at a 10:1 ratio)	36,127	36,127
Common stock, $0.0001 par value; 150,000 shares and 125,000 shares, respectively, authorized; 101,627 shares and 97,783 shares issued and outstanding, respectively	11	10
Additional paid-in capital	1,183,006	1,137,470
Accumulated other comprehensive loss	3	3
Accumulated deficit	(1,239,835)	(988,713)
Total stockholders’ equity	(20,688)	184,897
Total liabilities and stockholders’ equity	$ 289,000	$ 473,573

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	338,000	338,000
Preferred stock, shares outstanding	338,000	338,000
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	150,000,000	125,000,000
Common stock, shares issued	106,098,000	101,627,000
Common stock, shares outstanding	106,098,000	101,627,000
Common stock conversion ratio	10.00%	10.00%
Common stock upon conversion	3,378,000	3,378,000

XML

Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenue:
Total revenue	$ 37,427	$ 15,762	$ 23,800
Operating expenses:
Cost of revenue	10,498	5,067
Research and development	130,966	110,933	132,639
Selling, general and administrative	133,955	125,178	68,303
Total operating expenses	275,419	241,178	200,942
Operating loss	(237,992)	(225,416)	(177,142)
Other (expense) income, net:
Interest (expense) income, net	(22,380)	(4,682)	7,110
Other expense, net	(66)	(99)	(13)
Change in fair value of warrants to purchase common stock	11,120	0	0
Related party non-cash interest expense related to sale of future royalties	(1,782)	(1,383)	(192)
Other (expense) income, net	(13,108)	(6,164)	6,905
Loss before income taxes	(251,100)	(231,580)	(170,237)
Income tax provision	(22)	(114)	(58)
Net loss	(251,122)	(231,694)	(170,295)
Other comprehensive (loss) income:
Unrealized gain (loss) on available for sale securities	0	(16)	73
Comprehensive loss	(251,122)	(231,710)	(170,222)
Reconciliation of net loss to net loss attributable to common stockholders:
Net loss	(251,122)	(231,694)	(170,295)
Accretion of convertible preferred stock	0	0	(2,940)
Net loss attributable to common stockholders	$ (251,122)	$ (231,694)	$ (173,235)
Net loss per share attributable to common stockholders:
Basic	$ (2.45)	$ (2.29)	$ (1.93)
Diluted	$ (2.45)	$ (2.29)	$ (1.93)
Weighted-average common shares outstanding used in net loss per share attributable to common stockholders:
Basic	102,646	100,960	89,891
Diluted	102,646	100,960	89,891
Product [Member]
Revenue:
Total revenue	$ 30,922	$ 11,469
Collaboration Revenue [Member]
Revenue:
Total revenue	$ 6,505	$ 4,293	$ 23,800

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (251,122)	$ (231,694)	$ (170,295)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	5,246	3,984	840
Stock-based compensation	26,787	27,609	18,016
Amortization of discount (premium) on investments	970	(93)	(3,175)
Amortization of debt discount	791	406	37
Change in fair value of warrant liability	(11,120)	0	0
Loss on disposal of property and equipment	0	19	0
Non-cash royalty revenue related to sale of future royalties	(31)
Non-cash interest expense associated with the sale of future royalties	1,782	1,383	192
Deferred income taxes	0	92	92
Changes in operating assets and liabilities:
Accounts receivable	(3,467)	(538)	17,500
Inventory	(8,224)	(10,461)	0
Prepaid expenses and other current assets	(1,605)	(2,398)	(3,359)
Accounts payable	84	1,480	3,389
Accrued expenses	1,771	6,006	2,897
Deferred revenue	11,950	(3,806)	(13,300)
Operating lease assets	(2,749)	3,901	(9,921)
Operating lease liabilities	2,577	(2,085)	10,043
Other assets and liabilities	(493)	(141)	(124)
Net cash used in operating activities	(226,853)	(206,336)	(147,168)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of available-for-sale securities	(262,613)	(276,404)	(504,981)
Maturities of available-for-sale securities	388,581	312,694	420,255
Purchase of intangible asset		(50,000)	0
Purchases of property and equipment	(486)	(880)	(594)
Net cash provided by (used in) investing activities	125,482	(14,590)	(85,320)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock, net of commissions	15,954	0	122,991
Proceeds from issuance of preferred stock, net of commissions	0	0	37,432
Payment of offering costs	(308)	(79)	(284)
Proceeds from the issuance of debt	0	195,000	25,000
Proceeds from the issuance of warrants	13,050
Payment of debt issuance costs	0	(3,123)	(1,650)
Proceeds from the issuance of common stock, warrants, and sale of future royalties to RPI, net of offering costs	0	0	99,774
Proceeds from the issuance of common stock in connection with the exercise of the Put Option, net of financing costs	0	49,915	0
Payment under capital lease obligation	0	0	(16)
Proceeds from stock options exercised	916	6,692	2,358
Issuance of shares under employee stock purchase plan	1,880	1,254	741
Net cash provided by financing activities	31,492	249,659	286,346
Net increase (decrease) in cash, cash equivalents and restricted cash	(69,879)	28,733	53,858
Cash, cash equivalents, and restricted cash, beginning of period	169,724	140,991	87,133
Cash, cash equivalents, and restricted cash, end of period	99,845	169,724	140,991
SUPPLEMENTAL CASH FLOW INFORMATION:
Unpaid offering costs	179	0	78
Unpaid debt issuance costs	0	0	78
Interest paid	21,748	7,461	0
Property and equipment included in accounts payable or accruals	0	60	454
Cash paid for income taxes	$ 104	$ 64	$ 45

XML

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	Put Option	Royalty Pharma [Member]	Series A Convertible Preferred Stock [Member]	Common Stock [Member]	Common Stock [Member] Put Option	Common Stock [Member] Royalty Pharma [Member]	Common Stock [Member] Series A Convertible Preferred Stock [Member]	Preferred Stock [Member]	Preferred Stock [Member] Series A Convertible Preferred Stock [Member]	Additional Paid-In Capital [Member]	Additional Paid-In Capital [Member] Put Option	Additional Paid-In Capital [Member] Royalty Pharma [Member]	Additional Paid-In Capital [Member] Series A Convertible Preferred Stock [Member]	Accumulated Deficit [Member]	Accumulated Other Comprehensive Loss [Member]
Beginning Balance, Value at Dec. 31, 2018	$ 233,009				$ 8						$ 819,779				$ (586,724)	$ (54)
Beginning Balance, Shares at Dec. 31, 2018					79,175,380
Issuance of series A convertible preferred stock, net of commissions and beneficial conversion charge, Value				$ 37,432						$ 34,492				$ 2,940
Issuance of Series A Convertible Preferred Stock, net of commissions and beneficial conversion charge, Shares										350,000
Accretion of series A convertible preferred stock	2,940									$ 2,940				(2,940)
Issuance of common stock, Value	122,708		$ 78,705		$ 1		$ 1				122,707		$ 78,704
Issuance of common stock, Shares					11,500,000		6,666,667
Issuance of warrant			$ 8,390										$ 8,390
Exercise of stock options and vesting of restricted stock units, Value	2,358										2,358
Exercise of stock options and vesting of restricted stock units, Shares					356,538
Stock-based compensation	17,875										17,875
Stock in lieu of board fees	141										141
Stock in lieu of board fees, Shares					12,156
Issuance of shares under employee stock purchase plan, Value	741										741
Issuance of shares under employee stock purchase plan, Shares					72,735
Unrealized gain (loss) on available for sale securities	73															73
Net loss	(170,295)														(170,295)
Ending Balance, Value at Dec. 31, 2019	331,137				$ 10				$ 37,432		1,050,695				(757,019)	19
Ending Balance, Shares at Dec. 31, 2019					97,783,476				350,000
Issuance of series A convertible preferred stock, net of commissions and beneficial conversion charge, Value										$ (1,305)				$ 1,305
Issuance of Series A Convertible Preferred Stock, net of commissions and beneficial conversion charge, Shares								122,000		(12,200)
Accretion of series A convertible preferred stock	0
Issuance of common stock, Value		$ 49,915										$ 49,915
Issuance of common stock, Shares						2,500,000
Exercise of stock options and vesting of restricted stock units, Value	6,692										6,692
Exercise of stock options and vesting of restricted stock units, Shares					1,097,280
Stock-based compensation	27,471										27,471
Stock in lieu of board fees	138										138
Stock in lieu of board fees, Shares					8,683
Issuance of shares under employee stock purchase plan, Value	1,254										1,254
Issuance of shares under employee stock purchase plan, Shares					115,631
Unrealized gain (loss) on available for sale securities	(16)															16
Net loss	(231,694)														231,694
Ending Balance, Value at Dec. 31, 2020	184,897				$ 10				$ 36,127		1,137,470				(988,713)	(3)
Ending Balance, Shares at Dec. 31, 2020					101,627,070				337,800
Accretion of series A convertible preferred stock	0
Issuance of common stock, Value	15,954										15,953
Issuance of common stock, Shares					3,840,977
Exercise of stock options and vesting of restricted stock units, Value	916										916
Exercise of stock options and vesting of restricted stock units, Shares					290,872
Stock-based compensation	26,597										26,597
Stock in lieu of board fees	190										190
Stock in lieu of board fees, Shares					35,365
Issuance of shares under employee stock purchase plan, Value	1,880										1,880
Issuance of shares under employee stock purchase plan, Shares					303,244
Unrealized gain (loss) on available for sale securities	0															(0)
Net loss	(251,122)														(251,122)
Ending Balance, Value at Dec. 31, 2021	$ (20,688)				$ 11				$ 36,127		$ 1,183,006				$ (1,239,835)	$ (3)
Ending Balance, Shares at Dec. 31, 2021					106,097,528				337,800

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Consolidated Statements of Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Issuance of common stock, commissions and offering costs		$ 284	$ 515
Put Option
Financing Cost	$ 85
Royalty Pharma [Member]
Issuance of common stock, commissions and offering costs		$ 304

XML

The Company

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

The Company

1. The Company

Epizyme, Inc. (collectively referred to with its wholly owned, controlled subsidiary, Epizyme Securities Corporation, as “Epizyme” or the “Company”) is a commercial-stage biopharmaceutical company that is committed to rewriting treatment for people with cancer through the discovery, development, and commercialization of novel epigenetic medicines. The Company aspires to change the standard of care for patients and physicians by developing targeted medicines with fundamentally new mechanisms of action directed at specific causes of hematological malignancies and solid tumors.

Through December 31, 2021, in addition to revenues from product sales, the Company has raised, an aggregate of $1,568.3 million to fund its operations. This includes $268.8 million of non-equity funding through its collaboration agreements, $368.1 million of funding, consisting of $150.0 million in equity funding received through agreements with RPI Finance Trust ("RPI"), and $218.1 million in debt financing received through a loan agreement with BioPharma Credit Investments V (Master) LP and BPCR Limited Partnership (as transferee of BioPharma Credit Investments V (Master) LP’s interest as a lender), ("the Lenders"), $855.4 million from the sale of common stock and series A convertible preferred stock in the Company’s public and at-the-market offerings and $76.0 million from the sale of redeemable convertible preferred stock in private financings prior to the Company’s initial public offering in May 2013. As of December 31, 2021, the Company had $176.8 million in cash, cash equivalents and marketable securities.

In 2020, the Company’s EZH2 inhibitor, tazemetostat, was approved in the United States as TAZVERIK for the treatment of epithelioid sarcoma ("ES") and follicular lymphoma ("FL"). Commercial sales of TAZVERIK for the treatment of ES commenced in the first quarter of 2020 and commercial sales of TAZVERIK for the treatment of FL commenced in the second quarter of 2020.

The Company commenced active operations in early 2008. Since its inception, the Company has generated an accumulated deficit of $1,239.8 million through December 31, 2021 and will require substantial additional capital to fund its research, development, and commercialization efforts. The Company is subject to risks common to companies in the biotechnology industry, including, but not limited to, risks of failure of commercialization, clinical trials and preclinical studies, the need to obtain additional financing to fund the future development and commercialization of tazemetostat and the rest of its pipeline, the need to obtain marketing approval for its product candidates, the need to successfully commercialize and gain market acceptance TAZVERIK and of any product candidates that may be approved in the future, the impact of the COVID-19 pandemic on the Company’s business, results of operations, and financial condition, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations and ability to transition from clinical-stage manufacturing to commercial-stage production, marketing and sale of products.

Operating Cost Reduction

On August 9, 2021, the Company announced a cross-functional reduction of approximately 11% of its then current workforce under a cost reduction plan. Affected employees were offered separation benefits, including severance payments along with temporary healthcare coverage assistance. The severance and termination-related costs totaled approximately $2.0 million, $1.6 million of which were recorded as selling general and administrative expenses and $0.4 million of which was recorded as research and development expenses in the third quarter of 2021. The Company expects that payments of these costs will be made through August 2022.

XML

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The consolidated financial statements of the Company included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC, and in accordance with U.S. generally accepted accounting principles, or GAAP. Any reference in these notes to applicable guidance is meant to refer to the authoritative accounting principles generally accepted in the United States as found in the ASC and Accounting Standards Update, or ASU, of the Financial Accounting Standards Board, or FASB. The consolidated financial statements include the accounts of Epizyme, Inc. and its wholly owned, controlled subsidiary, Epizyme Securities Corporation. All intercompany transactions and balances of subsidiaries have been eliminated in consolidation.

Use of Estimates

The preparation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities, as of the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results and outcomes may differ materially from management’s estimates, judgments and assumptions.

Subsequent Events

The Company considers events or transactions that occur after the balance sheet date but before the consolidated financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. The Company evaluated all events and transactions through the date these financial statements were filed with the Securities and Exchange Commission.

Cash and cash equivalents

The Company considers all highly liquid securities with original final maturities of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents are comprised of demand deposit accounts, funds in money market accounts, commercial paper and corporate notes.

Marketable securities

The Company classifies marketable securities with a remaining maturity when purchased of greater than three months as available-for-sale. The Company considers all available-for-sale securities, including those with maturity dates beyond 12 months, as available to support current operational liquidity needs and therefore classifies all securities with maturity dates beyond 90 days at the date of purchase as current assets. Available-for-sale securities are maintained by the Company’s investment managers and may consist of commercial paper, high-grade corporate notes, U.S. Treasury securities, and U.S. government agency securities. Available-for-sale securities are carried at fair value with the unrealized gains and losses included in other comprehensive loss as a component of stockholders’ equity until realized. Any premium or discount arising at purchase is amortized and/or accreted to interest income and/or expense over the life of the instrument. Realized gains and losses are determined using the specific identification method and are included in other income (expense).

The aggregate fair value of securities held by the Company in an unrealized loss position for less than twelve months as of December 31, 2021 was $28.6 million, which consisted of 4 commercial paper securities and 6 U.S. Treasury securities. There were no marketable securities held by the Company for greater than twelve months as of December 31, 2021. The aggregate fair value of securities held by the Company in an unrealized loss position for less than twelve months as of December 31, 2020 was $67.7 million, which consisted of 6 commercial paper securities, 7 corporate notes securities and 1 U.S. Treasury security. There were no marketable securities held by the Company for greater than twelve months as of December 31, 2020.

The Company does not intend to sell and it is unlikely that the Company will be required to sell the above investments before recovery of their amortized cost bases, which may be maturity. The Company determined there

was no material change in the credit risk of the above investments, and as a result, the Company determined it did not hold any investments with an other-than-temporary impairment as of December 31, 2021 and 2020. The Company reviews its portfolio of available-for-sale debt securities, using both quantitative and qualitative factors, to determine if declines in fair value below cost have resulted from a credit-related loss or other factors. If the decline in fair value is due to credit-related factors, a loss is recognized in net income, whereas if the decline in fair value is not due to credit-related factors, the loss is recorded in other comprehensive income (loss).

The following table summarizes the available for sale securities held at December 31, 2021 (in thousands):

Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Commercial paper	$	68,427	$	7	$	(3	)	$	68,431
Corporate notes		—		—		—			—
U.S. government agency securities and U.S. Treasuries		10,025		—		(1	)		10,024
Total	$	78,452	$	7	$	(4	)	$	78,455

The following table summarizes the available for sale securities held at December 31, 2020 (in thousands):

Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Commercial paper	$	158,907	$	14	$	(8	)	$	158,913
Corporate notes		33,437		3		(7	)		33,433
U.S. government agency securities and U.S. Treasuries		13,044		1		—			13,045
Total	$	205,388	$	18	$	(15	)	$	205,391

Certain short-term debt securities with original maturities of less than 90 days are included in cash and cash equivalents within the consolidated balance sheets and are not included in the tables above.

All marketable securities held at December 31, 2021 and December 31, 2020 have maturities of less than one year.

The amortized cost of available-for-sale securities is adjusted for amortization of premiums and accretion of discounts to maturity. At December 31, 2021, the balance in the Company’s accumulated other comprehensive loss was composed mainly of activity related to the Company’s available-for-sale marketable securities. There were no realized gains or losses recognized on the sale or maturity of available-for-sale securities during the year ended December 31, 2021 and December 31, 2020, respectively, and as a result, the Company did not reclassify any amounts out of accumulated other comprehensive loss for the same period.

Restricted Cash

A reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows, is as follows:

	December 31,
	2021		2020		2019
	(In thousands)
Cash and cash equivalents	$	98,336	$	168,215	$	139,482
Restricted cash, as part of other assets		1,509		1,509	1509
Total cash, cash equivalents, and restricted cash
shown in the consolidated statements of cash flows	$	99,845	$	169,724	$	140,991

The $1.5 million in restricted cash is comprised of $0.5 million in a letter of credit as a security deposit for the office and laboratory lease at Technology Square in Cambridge, Massachusetts and $1.0 million in a letter of credit as a security deposit for the Company’s office lease at Hampshire Street in Cambridge, Massachusetts. The Company has recorded cash held to secure these letters of credit as restricted cash in restricted cash and other assets on the consolidated balance sheet. The restricted cash is classified as non-current based on the related lease terms.

Fair Value Measurements

The FASB Codification Topic 820, Fair Value Measurements and Disclosures, requires the use of valuation techniques that are consistent with the market approach, the income approach and/or the cost approach. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. The income approach uses valuation techniques to convert future amounts, such as cash flows or earnings, to a single present amount on a discounted basis. The cost approach is based on the amount that currently would be required to replace the service capacity of an asset (replacement cost). Valuation techniques should be consistently applied. GAAP also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

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

Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s financial instruments as of December 31, 2021 and 2020 consisted primarily of cash and cash equivalents, marketable securities and accounts receivable and accounts payable. As of December 31, 2021 and December 31, 2020, the Company’s financial assets recognized at fair value consisted of the following:

	Fair Value as of December 31, 2021
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents	$	88,637	$	67,209	$	21,428	$	—
Marketable securities:
Commercial paper		68,431		—		68,431		—
Corporate notes		—		—		—		—
U.S. government agency securities and treasuries		10,024		—		10,024		—
Total	$	167,092	$	67,209	$	99,883	$	—

	Fair Value as of December 31, 2020
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents	$	163,264	$	113,505	$	49,759	$	—
Marketable securities:
Commercial paper		158,913		—		158,913		—
Corporate notes		33,433		—		33,433		—
U.S. government agency securities and treasuries		13,045		—		13,045		—
Total	$	368,655	$	113,505	$	255,150	$	—

Cash equivalents and marketable securities have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing third-party pricing services or other market observable data.

The Company measures its cash equivalents at fair value on a recurring basis, which approximates the net asset value per share. The Company classifies some of its cash equivalents within Level 1 of the fair value hierarchy because they are valued using observable inputs that reflect quoted prices for identical assets in active markets. The Company measures its marketable securities at fair value on a recurring basis and classifies those instruments and

some cash equivalents within Level 2 of the fair value hierarchy. The pricing services used by management utilize industry standard valuation models, including both income and market-based approaches and observable market inputs to determine the fair value of marketable securities and those cash equivalents classified within Level 2 of the fair value hierarchy.

As of December 31, 2021, the fair value of the long-term debt, payable in installments through November 18, 2026, approximated its carrying value due to the proximity of the issuance of the Tranche D Loan date to December 31, 2021 (See Note 13, Long-Term Debt).

Amortization of Debt Discount and Issuance Costs

Long-term debt is initially recorded at its allocated proceeds, net of discounts and deferred costs. Debt discount and issuance costs, consisting of legal and other fees directly related to the debt, are offset against initial carrying value of the debt and are amortized to interest expense over the estimated life of the debt based on the effective interest method.

Liability Related to Sale of Future Royalties

The Company treats the liability related to sale of future royalties as a debt financing, as the Company has significant continuing involvement in the generation of the cash flows, to be amortized to interest expense using the effective interest rate method over the life of the related royalty stream.

The liability related to sale of future royalties and the related interest expense are based on the Company’s current estimates of future royalties expected to be paid over the life of the arrangement. The Company will periodically assess the expected royalty payments using a combination of internal projections and forecasts from external sources. To the extent the Company’s future estimates of royalty payments are greater or less than previous estimates or the estimated timing of such payments is materially different than its previous estimates, the Company will adjust its effective interest rate, which is applied prospectively.

For further discussion of the sale of future royalties, refer to Note 12, Sale of Future Royalties.

Going Concern

At each reporting period, the Company evaluates whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company is required to make certain additional disclosures if it concludes substantial doubt exists about the Company's ability to continue as a going concern within one year after the date that the financial statements are issued and such doubt is not alleviated by the Company’s plans or when its plans alleviate substantial doubt about the Company’s ability to continue as a going concern. The Company’s evaluation entails analyzing prospective operating budgets and forecasts for expectations of the Company’s cash needs, and comparing those needs to its available cash, cash equivalents and marketable securities.

The Company has recurring losses and expects to have recurring losses for the foreseeable future with the continued commercialization of TAZVERIK in ES and FL, the development of tazemetostat in other indications, and the development of the Company’s other product candidates. In addition, the Company has experienced and continues to experience challenges in the continued commercialization of TAZVERIK resulting from the ongoing COVID-19 pandemic, which the Company believes has had an adverse impact on TAZVERIK revenues. In response to the challenges that the Company has continued to face since the Company commenced its launch of TAZVERIK in FL in June 2020, the Company implemented an operational cost reduction plan that was announced on August 9, 2021 and continues to evaluate its costs on an on-going basis with the intent to streamline such costs.

The analysis of the Company’s ability to continue as a going concern for the year ended December 31, 2021 included consideration of the Company’s current cash needs, including its research and development plans, commercialization activities associated with the continued commercialization of TAZVERIK in the ES and FL indications, its existing debt service obligations, and anticipated cost savings resulting from its operational cost reduction plan, including ongoing efforts to eliminate costs not related to the Company’s strategic focus. The analysis included forecasted product revenues from sales of TAZVERIK. Such estimates of future sales contain significant judgment as TAZVERIK was first launched in the first half of 2020 and there is little history with which

to base such estimates. In addition, the Company’s ongoing efforts to eliminate costs not related to the Company’s strategic focus contains uncertainties as to whether the Company can attain such benefits. Based on the analysis, the Company concluded that its available cash, cash equivalents and marketable securities as of December 31, 2021 combined with the $79.5 million raised in January 2022 (see Note 18 for further information) will be sufficient to fund current planned operations and capital expenditure requirements and pay its debt service obligations as they become due into the third quarter of 2023 which is at least 12 months from the filing date of this Annual Report on Form 10-K with the SEC. As a result, the Company concluded that it did not identify conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date these financial statements were issued. The Company’s current operating plan is based on assumptions that may prove to be wrong, and the Company could use its capital resources sooner than it expects, in which case the Company would evaluate further reductions in its expenses or obtaining additional financing sooner than it otherwise would, which additional financing may not be available or may only be available on terms that are not acceptable to the Company.

Accounts Receivable

The Company extends credit to customers based on its evaluation of the customer’s financial condition. The Company records receivables for all billings when amounts are due under standard terms. Accounts receivable are stated at amounts due net of applicable prompt pay discounts and other contractual adjustments as well as an allowance for doubtful accounts. The Company assesses the need for an allowance for doubtful accounts by considering a number of factors, including the length of time trade accounts receivable are past due, the customer’s ability to pay its obligation and the condition of the general economy and the industry as a whole. The Company will write off accounts receivable when the Company determines that they are uncollectible. In general, the Company has experienced no significant collection issues with its customers.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk include cash, cash equivalents, marketable securities and accounts receivable. The Company attempts to minimize the risks related to cash, cash equivalents and marketable securities by working with highly rated financial institutions that invest in a broad and diverse range of financial instruments as defined by the Company. The Company has established guidelines relative to credit ratings and maturities intended to safeguard principal balances and maintain liquidity. The Company maintains its funds in accordance with its investment policy, which defines allowable investments, specifies credit quality standards and is designed to limit the Company’s credit exposure to any single issuer.

Accounts receivable represent amounts due from customers and collaboration partners. The Company monitors economic conditions to identify facts or circumstances that may indicate that any of its accounts receivable are at risk of collection. For a further discussion of concentration of credit risk see Note 3, Product Revenue, Net.

Property and Equipment

The Company records property and equipment at cost. Property and equipment acquired under a capital lease is recorded at the lesser of the present value of the minimum lease payments under the capital lease or the fair value of the leased property at lease inception. The Company calculates depreciation and amortization using the straight-line method over the following estimated useful lives:

Asset Category	Useful Lives
Laboratory equipment	3 - 6 years
Computer and office equipment, and furniture	3 - 10 years
Leasehold improvements	3 - 6 years or term of respective lease, if shorter

Amortization of capital lease assets is included in depreciation expense. The Company capitalizes expenditures for new property and equipment and improvements to existing facilities and charges the cost of maintenance to expense. The Company eliminates the cost of property retired or otherwise disposed of, along with the corresponding accumulated depreciation, from the related accounts, and the resulting gain or loss is reflected in the results of operations.

Impairment of Long-Lived Assets

The Company reviews long-lived assets to be held and used, including property and equipment and intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be recoverable.

Evaluation of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset or asset group and its eventual disposition. In the event that such cash flows are not expected to be sufficient to recover the carrying amount of the asset or asset group, the assets are written down to their estimated fair values. No such impairments were recorded during 2021, 2020 or 2019.

Income Taxes

The Company records deferred income taxes to recognize the effect of temporary differences between tax and financial statement reporting. The Company calculates the deferred taxes using enacted tax rates expected to be in place when the temporary differences are realized and records a valuation allowance to reduce deferred tax assets if it is determined that it is more likely than not that all or a portion of the deferred tax asset will not be realized. The Company considers many factors when assessing the likelihood of future realization of deferred tax assets, including recent earnings results, expectations of future taxable income, carryforward periods available and other relevant factors. The Company records changes in the required valuation allowance in the period that the determination is made.

The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available as of the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, the Company records the largest amount of tax benefit with a greater than 50.0% likelihood of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, the Company does not recognize a tax benefit in the financial statements. The Company records interest and penalties related to uncertain tax positions, if applicable, as a component of income tax expense. Refer to Note 8, Income Taxes, for additional information regarding the Company’s income taxes.

Revenue Recognition – Collaboration Revenue

Under ASC 606, Revenue from Contracts with Customers, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company has entered into collaboration and license agreements, which are within the scope of ASC 606, to discover, develop, manufacture and commercialize product candidates. The terms of these agreements typically contain multiple promises or obligations, which may include: (i) licenses, or options to obtain licenses, to compounds directed to specific targets (referred to as “exclusive licenses”) and (ii) research and development activities to be performed on behalf of the collaboration partner related to the licensed targets. Payments to the Company under these agreements may include non-refundable license fees, customer option exercise fees, payments for research activities, reimbursement of certain costs, payments based upon the achievement of certain milestones and royalties on any resulting net product sales.

The Company first evaluates license and/or collaboration arrangements to determine whether the arrangement (or part of the arrangement) represents a collaborative arrangement pursuant to ASC Topic 808, Collaborative Arrangements, based on the risks and rewards and activities of the parties pursuant to the contractual arrangement. The Company accounts for collaborative arrangements (or elements within the contract that are deemed part of a collaborative arrangement), which represent a collaborative relationship and not a customer relationship, outside the scope of ASC 606. The Company’s collaborations primarily represent revenue arrangements. The Company uses judgment to determine whether milestones or other variable consideration, except for sales-based royalties, should be included in the transaction price as described further below. The transaction price is allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. In determining the stand-alone selling price of a license to the Company’s proprietary technology or a material right provided by a customer option, the Company considers market conditions as well as entity-specific factors, including those factors contemplated in negotiating the agreements as well as internally developed estimates that include assumptions related to the market opportunity, estimated development costs, probability of success and the time needed to commercialize a product candidate pursuant to the license. In validating its estimated stand-alone selling price, the Company evaluates whether changes in the key assumptions used to determine its estimated stand-alone selling price will have a significant effect on the allocation of arrangement consideration between performance obligations.

Amounts received prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Amounts recognized as revenue, but not yet received or invoiced are generally recognized as contract assets.

Exclusive Licenses – If the license to the Company’s intellectual property is determined to be distinct from the other promises or performance obligations identified in the arrangement, which generally include research and development services, the Company recognizes revenue from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. In assessing whether a license is distinct from the other promises, the Company considers relevant facts and circumstances of each arrangement, including the research and development capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the collaboration partner can benefit from the license for its intended purpose without the receipt of the remaining promises, whether the value of the license is dependent on the unsatisfied promises, whether there are other vendors that could provide the remaining promises, and whether it is separately identifiable from the remaining promises. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the research and development and licensing agreement.

Research and Development Services – The promises under the Company’s collaboration and license agreements generally include research and development services to be performed by the Company on behalf of the collaboration partner. For performance obligations that include research and development services, the Company generally recognizes revenue allocated to such performance obligations based on an appropriate measure of progress. The Company utilizes judgment to determine the appropriate method of measuring progress for purposes of recognizing revenue, which is generally an input measure such as costs incurred. The Company evaluates the measure of progress each reporting period as described under Exclusive Licenses above. Reimbursements from the partner that are the result of a collaborative relationship with the partner, instead of a customer relationship, such as co-development activities, are recorded as a reduction to research and development expense.

Customer Options – The Company’s arrangements may provide a collaborator with the right to select a target for licensing either at the inception of the arrangement or within an initial pre-defined selection period, which may, in certain cases, include the right of the collaborator to extend the selection period. Under these agreements, fees may be due to the Company (i) at the inception of the arrangement as an upfront fee or payment, (ii) upon the exercise of an option to acquire a license or (iii) upon extending the selection period as an extension fee or payment. If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. The Company evaluates the customer options for material rights, or options to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the inception of the arrangement. The Company allocates the transaction price to material rights based on the relative stand-alone selling price, which is determined based on the identified discount and the probability that the customer will exercise the option. Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised or expires.

Milestone Payments – At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. If a milestone or other variable consideration relates specifically to the Company’s efforts to satisfy a single performance obligation or to a specific outcome from satisfying the performance obligation, the Company generally allocates the milestone amount entirely to that performance obligation once it is probable that a significant revenue reversal would not occur.

Royalties – For arrangements that include sales-based royalties, including milestone payments based on a level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements.

For a complete discussion of accounting for collaboration revenues, see Note 11, Collaborations.

Revenue Recognition – Product Revenue

The Company recognizes revenue when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition, the Company performs the following five steps: (i) identify the contract(s) with a

customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. For a further discussion of accounting for net product revenue see Note 3, Product Revenue, Net.

Revenue Recognition – Other Revenue

Other revenue consists of revenue from the sales of tazemetostat active pharmaceutical ingredient (API) and drug product to the Company’s licensees or collaborators. The Company recognizes revenue on tazemetostat API and drug product when control has transferred under the terms of each agreement.

Cost of Revenues

Cost of revenues primarily consists of costs related to the sales of TAZVERIK and sales of tazemetostat API and drug product to the Company’s licensees or collaborators. These costs include materials, labor, manufacturing overhead, amortization of milestone payments, and royalties payable on net sales of TAZVERIK. Cost of revenues for the year ended December 31, 2021 included approximately $0.8 million related to sales of tazemetostat drug product. There were no cost of revenues for the sales of tazemetostat drug product during the year ended December 31, 2020 and 2019.

Research and Development Expenses

Research and development expenses are expensed as incurred. Research and development expenses are comprised of costs incurred in providing research and development activities, including salaries and benefits, facilities costs, overhead costs, contract research and development services, and other outside costs. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made.

External research and development expenses associated with the Company’s programs include clinical trial site costs, clinical manufacturing costs, costs incurred for consultants and other outside services, such as data management and statistical analysis support, and materials and supplies used in support of the clinical and preclinical programs. Internal costs of the Company’s clinical programs include salaries, stock-based compensation, and the portion of the Company’s facility costs allocated to research and development expense. When vendors billing terms do not coincide with the Company’s period-end, the Company is required to make estimates of its obligations to those vendors, including clinical trial and pharmaceutical development costs, contractual services costs and costs for supply of its product candidates incurred in a given accounting period and record accruals at the end of the period. The Company bases its estimates on its knowledge of the research and development programs, services performed for the period, past history for related activities and the expected duration of the vendor service contract, where applicable.

The Company generally accrues expenses related to research and development activities based on the services received and efforts expended pursuant to contracts with multiple contract research organizations that conduct and manage clinical trials, as well as other vendors that provide research and development services. Payments for these activities are based on the terms of the individual arrangements and may result in payment terms that differ from the pattern of costs incurred. There may be instances in which payments made to vendors will exceed the level of services provided and result in a prepayment of the clinical expense. Payments under some of these contracts depend on factors such as the successful enrollment of subjects and the completion of clinical trial milestones. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from estimates, the Company would adjust the accrual or prepaid accordingly in future periods.

Stock-Based Compensation

The Company measures employee and non-employee stock-based compensation based on the grant date fair value of the stock-based compensation award. The Company grants stock options at exercise prices equal to the fair value of the Company’s common stock on the date of grant, based on observable market prices.

The Company recognizes employee stock-based compensation expense on a straight-line basis over the requisite service period of the awards. The Company recognizes forfeitures at the time they occur. The actual expense recognized over the vesting period will only represent those options that vest.

For awards with performance conditions in which the award does not vest unless the performance condition is met, the Company recognizes expense if, and to the extent that, the Company estimates that achievement of the performance condition is probable. If the Company concludes that vesting is probable, it recognizes expense from the date it reaches this conclusion through the estimated vesting date. For awards with performance conditions that accelerate vesting of the award, the Company estimates the likelihood of satisfaction of the performance conditions, which affects the period over which the expense is recognized, and recognizes the expense using the accelerated attribution model.

Refer to Note 15, Employee Benefit Plans, for additional information regarding the measurement and recognition of expense related to the Company’s stock-based compensation awards.

Earnings (Loss) per Share

The Company computes basic earnings (loss) per share by dividing income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding. During periods of income, the Company allocates participating securities a proportional share of income determined by dividing total weighted average participating securities by the sum of the total weighted average common shares and participating securities (the “two-class method”). The Company’s restricted stock and Series A Convertible Preferred Stock par value of $0.0001 per share (the “Series A Preferred Stock”) participate in dividends declared by the Company and are therefore considered to be participating securities. Participating securities have the effect of diluting both basic and diluted earnings per share during periods of income. During periods of loss, the Company allocates no loss to participating securities because they have no contractual obligation to share in the losses of the Company. The Company computes diluted earnings (loss) per share after giving consideration to the dilutive effect of stock options and warrants that are outstanding during the period, except where such non-participating securities would be anti-dilutive. Refer to Note 16, Loss per Share, for the Company’s calculation of loss per share for the periods presented.

Segment Information

The Company currently operates as one reportable business segment: the discovery, development, and commercialization of novel epigenetic therapies for patients with cancer.

Inventory

The Company outsources the manufacturing of TAZVERIK and uses contract manufacturers to produce the raw and intermediate materials used in the production of TAZVERIK as well as the finished product. The Company currently has one supplier qualified for each step in the manufacturing process and is in the process of qualifying additional suppliers.

Inventory is composed of raw materials, intermediate materials, which are classified as work-in-process, and finished goods, which are goods that are available for sale. The Company states inventory at the lower of cost or net realizable value with the cost based on the first-in, first-out method. Inventory is classified as long-term when it is expected to be utilized beyond the Company’s normal operating cycle and is included in restricted cash and other assets on the Company's condensed consolidated balance sheets. If the Company identifies excess, obsolete or unsalable items, it writes down its inventory to its net realizable value in the period in which the impairment is identified. These adjustments are recorded based upon various factors related to the product, including the level of product manufactured by the Company, the level of product in the distribution channel, current and projected demand, the expected shelf-life of the product and firm inventory purchase commitments. Shipping and handling

costs incurred for inventory purchases are included in inventory costs and costs incurred for product shipments are recorded as incurred in cost of revenue.

Prior to receiving its first approval from the U.S. Food and Drug Administration, or FDA, on January 23, 2020 to sell TAZVERIK, the Company expensed all costs incurred related to the manufacture of TAZVERIK as research and development expense because of the inherent risks associated with the development of a product candidate, the uncertainty about the regulatory approval process and the lack of history for the Company of regulatory approval of drug candidates.

Intangible Assets, Net

Intangible assets consist of capitalized milestone payments made to third parties under an in-license of patent rights upon receiving regulatory approval of TAZVERIK. The finite lived intangible assets are being amortized on a straight-line basis over the expected time period the Company will benefit from the in-licensed rights, which is generally the patent life. Intangible assets are recorded at cost at the time of their acquisition and are stated in the Company’s consolidated balance sheets net of accumulated amortization and impairments, if applicable. The amortization expense is recognized as cost of revenue in the Company’s consolidated statement of operations. During 2020 the Company paid a total of $50.0 million in milestone payments under its agreement with Eisai, Co., Ltd., or Eisai, upon regulatory approval of tazemetostat for ES and FL. These regulatory milestones have been capitalized as intangible assets.

The following table presents intangible assets as of December 31, 2021 (in thousands):

	December 31, 2021			December 31, 2020			Estimated useful life (years)
In-licensed rights	$	50,000		$	50,000			12.2
Less: accumulated amortization		(7,151	)		(2,998	)
Total intangible asset, net	$	42,849		$	47,002

The Company recorded approximately $4.2 million and $3.0 million in amortization expense related to intangible assets, using the straight-line methodology, during the years ended December 31, 2021 and 2020, respectively. Estimated future amortization expense for intangible assets is approximately $4.2 million per year thereafter.

The Company assesses its intangible assets for impairment if indicators are present or changes in circumstance suggest that impairment may exist. Events that could result in an impairment, or trigger an interim impairment assessment, include the receipt of additional clinical or nonclinical data regarding one of the Company’s drug candidates or a potentially competitive drug candidate, changes in the clinical development program for a drug candidate, or new information regarding potential sales for the drug. If impairment indicators are present or changes in circumstance suggest that impairment may exist, the Company performs a recoverability test by comparing the sum of the estimated undiscounted cash flows of each intangible asset to its carrying value on the consolidated balance sheet. If the undiscounted cash flows used in the recoverability test are less than the carrying value, the Company would determine the fair value of the intangible asset and recognize an impairment loss if the carrying value of the intangible asset exceeds its fair value.

During the three months ended June 30, 2021, the Company concluded the lower than anticipated current and projected future revenue, due to the impact of the COVID-19 pandemic as well as other factors, was an indicator that impairment may exist related to its finite-lived intangible assets. As a result, the Company performed a recoverability test and determined that the finite-lived intangible assets were recoverable. The Company’s quantitative assessment considered significant assumptions related to estimates of future TAZVERIK sales, offset by direct costs to derive the sales. The estimates of future TAZVERIK sales and associated costs include estimates of significant growth, however, these estimates are uncertain as the product was first launched in the first half of 2020 and due to the uncertainties associated with the ongoing COVID-19 pandemic. Given the limited history of sales and the inherent difficulty in making a long-range forecast, such estimates contain significant uncertainty. If the assumptions regarding forecasted revenue or the costs to derive such revenues prove to be inaccurate, the

Company may be required to perform future impairment analyses and record an impairment charge for its intangible assets in future periods.

Leases

At inception of a contract, we determine whether an arrangement is or contains a lease. For all leases, we determine the classification as either operating or financing. As of December 31, 2021, the Company does not have any leases that are classified as finance leases.

ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments under the lease. Lease recognition occurs at the commencement date, and lease liability amounts are based on the present value of lease payments made during the lease term. Renewals are not assumed in the determination of the lease term unless they are deemed to be reasonably assured at the inception of the lease. Because our leases do not provide information to determine an implicit interest rate, we use our incremental borrowing rate in determining the present value of lease payments. ROU assets also include any lease payments made prior to the commencement date less lease incentives received. Operating lease expense is recognized on a straight-line basis over the lease term.

The Company has elected not to apply the recognition requirements to short-term leases with a term of 12 months or less. Instead, the Company recognizes the lease payments in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term.

Recently Adopted Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that we adopt as of the specified effective date. Unless otherwise discussed below, we do not believe that the adoption of recently issued standards have or may have a material impact on our consolidated financial statements or disclosures.

Revenue Recognition – Collaboration Revenue

In November 2018, the FASB, issued ASU 2018-18, Collaborative Arrangements, or ASC 808, which clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue when the collaborative arrangement participant is a customer in the context of a unit of account and precludes recognizing as revenue consideration received from a collaborative arrangement participant if the participant is not a customer. The new standard was effective in the first quarter of fiscal 2021. The Company adopted ASC 808 effective in the first quarter of fiscal 2021 and the Company’s adoption of this standard did not have a material effect on the Company’s financial statements.

Income Taxes

In December 2019, the Financial Accounting Standards Board, or the FASB, issued ASU 2019-12, Income Taxes, or ASC 740, which simplifies the accounting for income taxes. The new standard was effective in the first quarter of fiscal 2021. The Company adopted ASC 740 effective in the first quarter of fiscal 2021 and the Company’s adoption of this standard did not have a material effect on the Company’s financial statements. 

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Product Revenue Net

12 Months Ended

Dec. 31, 2021

TAZVERIK [Member]

Concentration Risk [Line Items]

Product Revenue Net

3. Product Revenue, Net

The Company sells TAZVERIK in the United States principally to a limited number of specialty pharmacies, which dispense the product directly to patients, and specialty distributors, which in turn sell the product to hospital pharmacies and community practice pharmacies (collectively, healthcare providers) for the treatment of patients. The specialty pharmacies and specialty distributors are referred to as the Company’s customers.

Product revenue is recognized by the Company in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services when the customer obtains control of the product, which occurs at a point in time, typically when the product is received by the Company’s customers. The Company provides a right of return to its customers for unopened product for a limited time before and after its expiration

date, which right of return lapses upon shipment to a patient. Healthcare providers to whom specialty distributors sell TAZVERIK hold limited inventory that is designated for patients, and the Company monitors inventory levels in the distribution channel, to limit the risk of return.

Reserves for Variable Consideration

Revenues from product sales are recorded as product revenue at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and which result from discounts, returns, chargebacks, rebates, co-pay assistance and other allowances that are offered within contracts between the Company and its customers, health care providers, payors and other indirect customers relating to the Company’s product sales. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than a customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as the Company’s historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which the Company is entitled based on the terms of the contract(s). The amount of variable consideration that is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known.

Trade Discounts and Allowances: The Company generally provides customers with discounts that include incentive fees that are explicitly stated in customer contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, the Company receives sales order management, data and distribution services from certain customers. To the extent the services received are distinct from the Company’s sale of products to the customer, these payments are classified in selling, general and administrative expenses in the consolidated statements of operations and comprehensive loss.

Product Returns: Consistent with industry practice, the Company generally offers customers a limited right of return based on the product’s expiration date for product that has been purchased from the Company, which lapses upon shipment to a patient. The Company estimates the amount of product sales that may be returned by customers and records this estimate as a reduction of revenue in the period in which the related product revenue is recognized. The Company currently estimates product return liabilities using available industry data and the Company’s own historical sales information, including its visibility into the product remaining in the distribution channel.

Provider Chargebacks and Discounts: Chargebacks for fees and discounts to healthcare providers represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to customers who directly purchase the product from the Company. Customers charge the Company for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. These reserves are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue and accounts receivable. Chargeback amounts are generally determined at the time of resale to the qualified healthcare provider by customers, and the Company generally issues credits for such amounts within a few weeks of the customer’s notification to the Company of the resale. Reserves for chargebacks consist of credits that the Company expects to issue for units that remain in the distribution channel at each reporting period end that the Company expects will be sold to qualified healthcare providers, and chargebacks that customers have claimed but for which the Company has not yet issued a credit.

Government Rebates: The Company is subject to discount obligations under state Medicaid programs and Medicare. The Company estimates its Medicaid and Medicare rebates based upon a range of possible outcomes that are probability-weighted for the estimated payor mix. These reserves are recorded in the same period in which the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability that is included in accrued expenses on the Company’s consolidated balance sheets. For Medicare, the Company also estimates the number of patients in the prescription drug coverage gap for whom the Company will owe an

additional liability under the Medicare Part D program. The Company’s liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter, and estimated future claims that will be made for product that has been recognized as revenue, but remains in the distribution channel inventories at period end.

Payor Rebates: The Company may contract with various private payor organizations, primarily insurance companies and pharmacy benefit managers, for the payment of rebates with respect to utilization of the Company’s products. The Company estimates these rebates and records such estimates in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability.

Other Incentives/Patient Assistance Programs: The Company also offers voluntary patient assistance programs such as co-pay assistance. Co-pay assistance programs are intended to provide financial assistance to qualified commercially insured patients with prescription drug co-payments required by payors. The calculation of the accrual for co-pay assistance is based on an estimate of claims and the cost per claim that the Company expects to receive associated with product that has been recognized as revenue, but remains in the distribution channel inventories at period end.

The following table summarizes activity in each of the above product revenue allowances and reserve categories for the year ended December 31, 2021:

	Chargebacks, Discounts, and			Government and Other
	Fees			Rebates			Returns			Total
	(In thousands)
Balance, January 1, 2021	$	133		$	428		$	67		$	628
Provision		1,886			3,093			274			5,253
Payments or credits		(1,775	)		(2,935	)		(232	)		(4,942	)
Balance, December 31, 2021	$	244		$	586		$	109		$	939

The following table summarizes activity in each of the above product revenue allowances and reserve categories for the year ended December 31, 2020:

	Chargebacks, Discounts, and			Government and Other
	Fees			Rebates			Returns		Total
	(In thousands)
Balance, January 1, 2020	$	—		$	—		$	—	$	—
Provision		802			1,046			67		1,915
Payments or credits		(669	)		(618	)		—		(1,287	)
Balance, December 31, 2020	$	133		$	428		$	67	$	628

Concentration of Credit Risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist of accounts receivable from customers and cash held at financial institutions. The Company believes that such customers and financial institutions are of high credit quality.

For the years ended December 31, 2021 and 2020 , net product revenue was primarily generated from five individual customers. Revenue earned from each customer as a percentage of net product revenue is as follows:

	Year Ended December 31,
	2021			2020
Customer 1		30	%		45	%
Customer 2		11	%		11	%
Customer 3		27	%		20	%
Customer 4		21	%		24	%
Customer 5		11	%		0	%

As of December 31, 2021 and 2020, five individual customers represented as a percentage of accounts receivable as follows:

	December 31, 2021			December 31, 2020
Customer 1		15	%		21	%
Customer 2		10	%		14	%
Customer 3		22	%		29	%
Customer 4		29	%		36	%
Customer 5		24	%		0	%

No other customer represented more than 10 percent of net product revenue or accounts receivable.

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Property and Equipment, net

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Property and Equipment, net

4. Property and Equipment, net

Property and equipment, net consists of the following:

	December 31,
	2021			2020
	(In thousands)
Laboratory equipment	$	4,580		$	4,435
Computer and office equipment, and furniture		4,386			4,636
Leasehold improvements	453			453
Construction in progress		157			34
Property and equipment		9,576			9,558
Less: accumulated depreciation		(8,031	)		(7,406	)
Property and equipment, net	$	1,545		$	2,152

Depreciation expense was $1.1 million, $1.0 million and $0.8 million for the years ended December 31, 2021, 2020, and 2019, respectively.

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Inventory

12 Months Ended

Dec. 31, 2021

Inventory Disclosure [Abstract]

Inventory

5. Inventory

All of the Company’s inventory relates to the manufacturing of TAZVERIK. The following table sets forth the Company’s inventory as of December 31, 2021 and December 31, 2020:

	December 31, 2021		December 31, 2020
	(In thousands)
Raw materials	$	3,227	$	1,068
Work in process		13,748		8,564
Finished goods		1,710		829
Total	$	18,685	$	10,461
Balance sheet classification
Inventory	$	3,216	$	10,461
Restricted cash and other assets		15,469		—
Total	$	18,685	$	10,461

As of December 31, 2021, the Company has not capitalized inventory costs related to its other drug development programs.

The Company’s active pharmaceutical ingredient has a long shelf life and the Company’s finished drug product has a three-year expiry, however the realizability of the inventory is subject to forecasted future sales of TAZVERIK. The Company’s forecasted sales currently support the realizability of the Company’s inventory but are uncertain and could change in the future, which would require the Company to write down the value of such inventory. Due to the revisions to the Company’s forecast of future TAZVERIK sales during the quarter ended June 30, 2021, the Company classified a portion of its inventory as long-term.

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Prepaid Expenses and Other Current Assets

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Prepaid Expenses and Other Current Assets

6. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following:

	December 31,
	2021		2020
	(In thousands)
Prepaid clinical and manufacturing costs	$	12,756	$	12,646
Interest receivable on available for sale securities	72		369
Other prepaid expenses and other receivables		6,637		4,906
Total prepaid expenses and other current assets	$	19,465	$	17,921

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Accrued Expenses

12 Months Ended

Dec. 31, 2021

Payables and Accruals [Abstract]

Accrued Expenses

7. Accrued Expenses

Accrued expenses consisted of the following:

	December 31,
	2021		2020
	(In thousands)
Employee compensation and benefits	$	11,737	$	11,921
Research and development expenses		13,744		10,664
Current portion of liability related to the sale of future royalties		273		—
Professional services and other		5,023		5,987
Accrued expenses	$	30,777	$	28,572

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Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

8. Income Taxes

The Company’s losses before income taxes consist solely of domestic losses.

The provision for (benefit from) income taxes for the years ended December 31, 2021, 2020, and 2019 is as follows:

	2021		2020		2019
	(In thousands)
Current	$	22	$	22	$	(34	)
Deferred		—		92		92
Total		22		114		58
Income tax provision	$	22	$	114	$	58

A reconciliation of the federal statutory income tax rate and the Company’s effective income tax rate is as follows:

	Year Ended December 31,
	2021			2020			2019
Federal statutory income tax rate		21.0	%		21.0	%		21.0	%
State income taxes		5.5			6.1			6.0
Research and development and other tax credits		2.6			2.0			1.9
Permanent items		0.1			(0.6	)		(0.7	)
Change in valuation allowance		(27.2	)		(27.9	)		(27.5	)
Other		(2.1	)		(0.6	)		(0.7	)
Effective income tax rate		0.0	%		0.0	%		0.0	%

Deferred Tax Assets (Liabilities)

The Company’s deferred tax assets (liabilities) included in other assets in the consolidated balance sheets consist of the following:

	December 31,
	2021			2020
	(In thousands)
Deferred tax assets:
Net operating loss carryforwards	$	294,248		$	238,792
Research and development and other credit carryforwards		41,189			34,205
Accruals and allowances		3,071			2,949
Eisai license payment		10,752			11,935
Stock compensation		8,211			7,338
Other		1,072			1,220
Sale of royalty		4,210			3,857
Lease liability		5,987			5,462
Business interest		7,060			1,220
Gross deferred tax assets		375,800			306,978
Deferred tax asset valuation allowance		(370,500	)		(302,137	)
Total deferred tax assets		5,300			4,841
Deferred tax liabilities:
Depreciation and other		—			(18	)
Right of use asset		(5,300	)		(4,709	)
Total deferred tax liabilities		(5,300	)		(4,727	)
Net deferred tax asset	$	—		$	114

The Company evaluated the expected recoverability of its net deferred tax assets as of December 31, 2021 and 2020, and determined that there was insufficient positive evidence to support the recoverability of these net deferred tax assets, concluding it is more likely than not that its net deferred tax assets would not be realized in the future; therefore, the Company provided a full valuation allowance against its net deferred tax asset balance as of December 31, 2021 and 2020.

As of December 31, 2021, the Company had operating loss carryforwards of approximately $1.1 billion and $1.1 billion available to offset future taxable income for United States federal and state income tax purposes, respectively. The U.S. federal tax operating loss carryforwards of $428.5 million will expire at various dates from 2029 through 2037. Approximately $664.9 million of the U.S. federal tax operating losses can be carried forward indefinitely. The state tax operating loss carryforwards expire commencing in 2030.

Additionally, as of December 31, 2021, the Company had research and development tax credit carryforwards of approximately $15.6 million and $6.1 million available to be used as a reduction of federal income taxes and state income taxes, respectively, which expire at various dates from 2028 through 2040, as well as federal orphan drug tax credit carryforwards of $20.8 million, which would expire at various dates from 2033 through 2041. The Company’s ability to use its operating loss carryforwards and tax credits to offset future taxable income is subject to restrictions under Section 382 of the U.S. Internal Revenue Code (the “Internal Revenue Code”). These restrictions may limit the future use of the operating loss carryforwards and tax credits if certain ownership changes described in the Internal Revenue Code occur. Future changes in stock ownership may occur that would create further limitations on

the Company’s use of the operating loss carryforwards and tax credits. In such a situation, the Company may be required to pay income taxes, even though significant operating loss carryforwards and tax credits exist.

Uncertain Tax Positions

The following is a rollforward of the Company’s unrecognized tax benefits:

	December 31,
	2021		2020		2019
	(In thousands)
Unrecognized tax benefits - as of beginning of year	$	7,160	$	6,328	$	5,743
Gross increases - current period tax positions		1,206		832		585
Unrecognized tax benefits - as of end of year	$	8,366	$	7,160	$	6,328

None of the Company’s unrecognized tax benefits would result in income tax expense or impact the Company’s effective tax rate if recognized. The Company had no accrued tax-related interest or penalties as of December 31, 2021 or 2020.

The Company has generated research and development and orphan drug credits, but has not conducted a study to document the qualified activities. This study may result in an adjustment to the Company’s reserve for uncertain tax positions, research and development credit, and orphan drug credit carryforwards.

The Company files income tax returns in the U.S. federal tax jurisdiction and various state tax jurisdictions. Since the Company is in a loss carryforward position, the Company is generally subject to examination by the U.S. federal, state and local income tax authorities for all tax years in which a loss carryforward is available.

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

9. Commitments and Contingencies

Commitments

In addition to commitments under leasing arrangements (Refer to Note 10, Leases), the Company committed to $10.4 million of development costs payable to Roche Molecular upon certain development and regulatory milestones, under the amended companion diagnostic agreement, and Eisai agreed to reimburse the Company $0.9 million of this amount related to a regulatory milestone for Japan, which Eisai paid to us in the fourth quarter of 2020. In July 2019, the Company entered into a fourth amendment to the companion diagnostics agreement. Under the amended agreement, the Company and Roche Molecular agreed to divide a $1.0 million regulatory milestone for the United States into two separate milestone payments, of which $0.5 million was paid by the Company as part of the signed amendment, and the remaining $0.5 million was paid by the Company in December 2019 upon the satisfaction of certain conditions set forth in the fourth amendment to the companion diagnostics agreement. As part of this fourth amendment, Roche Molecular also assigned all of its rights and obligations under the companion diagnostics agreement to Roche Sequencing due to a reorganization at Roche group, and this assignment became effective as of January 1, 2020. Through December 31, 2021, the Company has paid Roche Sequencing $9.4 million under the amended agreement, including developmental costs of $3.4 million paid in 2020, $4.0 million paid in 2019 and $2.0 million paid in 2018, respectively, upon the achievement of milestones under the amended agreement with Roche Sequencing. As of December 31, 2021, the Company is responsible for the remaining development costs of $1.0 million due under the agreement. In addition, the Company paid $1.0 million to Roche Sequencing for the achievement of a development milestone in the fourth quarter of 2020.

Additionally, the Company enters into contracts in the normal course of business with clinical research organizations for clinical and preclinical research studies, external manufacturers for product for use in clinical trials, and other research supplies and other services as part of the Company’s operations. These contracts generally

provide for termination on notice, and therefore are cancelable contracts and not included in contractual commitments.

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Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Leases

10. Leases

The Company enters into lease arrangements for its facilities as well as certain equipment. A summary of the arrangements are as follows:

Operating Leases

The Company leases office and laboratory space at Technology Square in Cambridge, Massachusetts under a Lease Agreement, dated as of June 15, 2012, as amended, or the Technology Square Lease, with ARE-TECH Square, LLC, a Delaware limited liability company.

In May 2017, the Company exercised its option to extend the term of the Technology Square Lease to November 30, 2022. Under the Technology Square Lease as amended, the Company agreed to pay a monthly base rent of approximately $0.2 million for the period commencing December 1, 2017 through May 31, 2018, with an increase on June 1, 2018 of approximately $33,000 and annual increases of approximately $9,000 on December 1 of each subsequent year until the last increase, which will occur on December 1, 2021.

On August 11, 2021, the Company, entered into a fifth amendment to the Technology Square Lease (the “Fifth Amendment”) with ARE-TECH Square, LLC. Under the Fifth Amendment, the Company extended the term of the Technology Square Lease through November 30, 2024. Under the Fifth Amendment, the Company will continue to pay the Landlord the current monthly base rent amount contemplated by the Technology Square Lease through November 30, 2022, with an increase commencing on December 1, 2022 and adjusting the monthly base rent amount to approximately $377,000 and an increase commencing on December 1, 2023 and adjusting the monthly base rent amount to approximately $388,000 through November 30, 2024. In addition, under the Fifth Amendment, the Landlord agreed to provide the Company with a tenant improvement allowance of up to approximately $430,000 if requested by the Company by August 11, 2022, subject to specified terms and conditions. In accordance with ASU 2016-02, Leases, or ASC 842, the Company accounted for the Fifth Amendment as a lease modification and remeasured the operating lease liability, resulting in an additional $7.0 million operating lease liability and right of use asset. Under the current terms of the Technology Square Lease, the Company does not have any further right to extend the term beyond November 30, 2024.

The Company has a $0.5 million letter of credit as a security deposit for the Technology Square Lease and has recorded cash held to secure this letter of credit as restricted cash and other assets on the consolidated balance sheet.

On August 16, 2019, the Company entered into a lease, or the Hampshire Street Lease, with BMR-Hampshire LLC, or BMR. The Hampshire Street Lease is for 33,525 rentable square feet of office space in Cambridge, Massachusetts. The Hampshire Street Lease commenced as of December 1, 2019. The Hampshire Street Lease has an initial term of seven years and four months from the commencement date and provides the Company with an option to extend the lease term for one additional five-year period. After a four-month period during which base rent was not payable, the Hampshire Street Lease provides for monthly rent payments starting at approximately $0.2 million and increasing 2.5% per year. In the event that the Company exercises its option to extend the lease term, the Hampshire Street Lease provides for monthly rent payments during the additional five-year period at the greater of the base rent rate at the end of the initial term or the then-current market rent.

The Company has a $1.0 million letter of credit in favor of BMR as a security deposit for the Hampshire Street Lease and has recorded cash held to secure this letter of credit as restricted cash and other assets on the consolidated balance sheet. In applying ASC 842, the Company determined the classification of the Hampshire Street Lease to be operating and recorded a lease liability and a right-of-use asset as of December 31, 2019.

The Company is required to pay certain variable costs to its landlords in addition to fixed rent. These costs include common area maintenance, real estate taxes, and parking and are included in lease expense.

The following table contains a summary of the lease costs recognized under ASC 842 and other information pertaining to the Company’s operating leases for the years ended December 31, 2021, 2020 and 2019:

	Twelve months ended December 31,			Twelve months ended December 31,			Twelve months ended December 31,
	2021			2020			2019
Lease cost
Operating lease cost	$	6,291		$	6,155		$	3,771
Variable lease cost		2,039			1,764			1,318
Total lease cost	$	8,330		$	7,919		$	5,089
Other information
Operating cash flows used for operating leases	$	6,436		$	4,374		$	3,648
Weighted average remaining lease term	4.2 years			5.3 years			5.3 years
Weighted average discount rate		9.74	%		9.77	%		9.60	%

Future minimum lease payments under the Company’s non-cancelable operating leases as of December 31, 2021, are as follows:

	2021
	(In thousands)
2022	$	6,202
2023		7,517
2024		7,322
2025		3,057
Thereafter		3,909
Total lease payments	$	28,007
Less: imputed interest		(5,356	)
Total operating lease liabilities at December 31, 2021	$	22,651

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Collaborations

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Collaborations

11. Collaborations

HutchMed

On August 7, 2021, the Company entered into a strategic collaboration pursuant to a license agreement (the “HutchMed License Agreement”) with Hutchison China MediTech Investment Limited (“HutchMed”) for the development, manufacture and commercialization of tazemetostat, either as a monotherapy or as a part of combinations with other therapies, including HutchMed proprietary compounds, agreed by the parties under the HutchMed License Agreement (“Licensed Products”) for the treatment of epithelioid sarcoma, follicular lymphoma, diffuse large B-cell lymphoma in humans, and any additional indications agreed by the parties in accordance with the terms of the HutchMed License Agreement (the “Field”) in mainland China, Taiwan, Hong Kong and Macau (each, a “Jurisdiction”, and collectively, the “Territory”).

Agreement Structure

The Company has granted HutchMed licenses under patent rights and know-how controlled by the Company to enable HutchMed to develop and commercialize Licensed Products in the Field in the Territory. The licenses granted to HutchMed are co-exclusive with the Company with respect to the development of Licensed Products in the Field in the Territory and exclusive with respect to the commercialization of Licensed Products in the Field in the Territory. The Company also granted HutchMed a license under patent rights and know-how controlled by the Company to enable HutchMed to manufacture tazemetostat drug substance and drug product for the purpose of developing and commercializing Licensed Products in the Field in the Territory. The Company retains development and commercialization rights with respect to Licensed Products in the rest of the world outside of the Territory except for Japan.

The Company has agreed to conduct a technology transfer of manufacturing technology to HutchMed to enable HutchMed to manufacture clinical and commercial quantities of tazemetostat drug substance and drug product to carry out its obligations and exercise its rights under the HutchMed License Agreement. Subject to the execution of a clinical supply agreement or commercial supply agreement, as applicable, and until the completion of the technology transfer to HutchMed, the Company has agreed to manufacture and supply HutchMed with tazemetostat drug substance and drug product in sufficient quantities for HutchMed’s development or commercialization activities for Licensed Products in the Field in the Territory.

HutchMed has agreed to use commercially reasonable efforts to carry out development activities in the Territory as agreed by the parties and to seek to obtain and maintain regulatory approval of the Licensed Products in the Territory. HutchMed agreed to use commercially reasonable efforts to commercialize Licensed Products in the Field in the Territory. HutchMed is responsible for all costs it incurs in developing, obtaining regulatory approval of, and commercializing Licensed Products in the Field in the Territory, including costs incurred by HutchMed in conducting clinical trials that only include clinical sites in the Territory. For global studies conducted by the Company that HutchMed elects to participate in by conducting any such study in the Territory, HutchMed will be responsible for enrolling and treating in the Territory 20% of the total number of study patients of such global study and will be responsible for costs for those patients enrolled and treated in such trials. HutchMed will also be responsible for 20% of the costs of such global studies that are not specific to any territory and the Company will be responsible for all other costs of such global studies. HutchMed has agreed to participate in the Company’s EZH-301 and SYMPHONY-1 (EZH-302) global studies, however under certain circumstances where the SYMPHONY-1 (EZH-302) global study is not considered a confirmatory trial for regulatory approval in China, the Company shall be responsible for the costs of the trial in the Territory.

Pursuant to the HutchMed License Agreement, the Company received a nonrefundable upfront payment of $25.0 million in September 2021. The Company is also entitled to milestone payments of up to $110.0 million in the aggregate for achievement of specified development and regulatory milestones with respect to Licensed Products in the Territory, and up to $175.0 million in the aggregate for achievement of specified sales milestones in the Territory with respect to the Licensed Products. The Company will also be entitled to receive tiered royalties, ranging from a mid-teens percentage to a low twenties percentage based on HutchMed’s cumulative annual net sales, if any, of Licensed Products in the Territory.

Under the HutchMed License Agreement, the Company issued a warrant to HutchMed (the “HutchMed Warrant”) , exercisable at any time prior to August 7, 2025 for up to 5,653,000 shares of the Company’s common stock at an exercise price of $11.50 per share.

Unless earlier terminated, the HutchMed License Agreement will expire upon the expiration of the last royalty term for the last Licensed Product in the Field in the Territory. HutchMed may terminate the HutchMed License Agreement in its entirety for any or no reason upon 12 months’ prior written notice to the Company. Either party may, subject to specified cure periods, terminate the HutchMed License Agreement in the event of the other party’s uncured material breach, and under specified circumstances relating to the other party’s insolvency or if the other party or its affiliates challenges the validity, patentability, or enforceability of patent rights that are owned by or licensed to such party or its affiliates and that are subject to the licenses granted in the HutchMed License Agreement.

License Revenue

The Company evaluated the terms of the HutchMed License Agreement and first determined that the HutchMed Warrant should be accounted for pursuant to ASC 815, Derivatives and Hedging, with the HutchMed Warrant's fair value of approximately $13.0 million (Note 14) at execution considered outside of the revenue arrangement.

The Company identified the following performance obligations at the inception of the HutchMed License Agreement: (1) exclusive license with rights to develop, manufacture and commercialize tazemetostat in the Territory, (2) research and development services related to global trials, and (3) a material right related to the Company’s obligation to provide clinical supply of tazemetostat. In addition, the Company may also provide certain technology transfer services related to providing HutchMed with the capability to manufacture tazemetostat, for which the Company will receive reimbursement that approximates stand-alone selling price.

The Company evaluated the HutchMed License Agreement under ASC 606, Revenue from Contracts with Customers. Based on that evaluation, the $12.0 million of the up-front fee remaining after allocation to the HutchMed Warrant and the reimbursement to be received for its research and development services constituted the amount of the consideration to be included in the transaction price. In addition, should the global SYMPHONY-1 (EZH-302) trial not be deemed a confirmatory trial for purposes of regulatory approval in China, the Company shall be responsible for reimbursing HutchMed for the costs of the portion of the global SYMPHONY-1 (EZH-302) trial that will be performed in China. The Company concluded that this repayment provision represented variable consideration under the arrangement. Due to the uncertainty of potential repayment, which is based solely on the decision of a regulatory authority, the Company could not assert that it was probable that a significant reversal of revenue would not occur. As a result, the Company determined that the transaction price should be fully constrained. The Company will evaluate the application of the constraint on a quarterly basis and should the contingency be resolved without future payment to HutchMed for the global SYMPHONY-1 (EZH-302) trial, the full upfront fee and any reimbursement of research and development services will be included in the transaction price. In addition, should the estimated payment to HutchMed for the global SYMPHONY-1 (EZH-302) trial be determined to be less than the cumulative up-front fee and research and development reimbursement payments, such excess will be included in the transaction price.

None of the development or regulatory milestones have been included in the transaction price, as all such milestone amounts were fully constrained. As part of the Company's evaluation of the constraint, the Company considered numerous factors, including that receipt of the milestones is outside the control of the Company and contingent upon success in future clinical trials and the licensee’s efforts. Any consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as these amounts have been determined to relate predominantly to the license granted to HutchMed and therefore are recognized at the later of when the performance obligation is satisfied or the related sales occur.

The Company delivered the license during the third quarter of 2021 and expects that based on the estimated standalone selling price of the license, that the majority of the consideration in the arrangement will be allocated to the license performance obligation, once such consideration is no longer constrained. As the Company performs research and development services, it will recognize revenue as such services are performed, upon the transaction price no longer being fully constrained.

GSK

In January 2011, the Company entered into a collaboration and license agreement with Glaxo Group Limited (an affiliate of GlaxoSmithKline plc), or GSK, to discover, develop and commercialize novel small molecule HMT inhibitors directed to available targets from the Company’s platform. Under the terms of the agreement, the Company granted GSK exclusive worldwide license rights to HMT inhibitors directed to three targets. In March 2014, the Company and GSK amended certain terms of this agreement for the third licensed target, revising the license terms with respect to candidate compounds and amending the corresponding financial terms, including reallocating milestone payments and increasing royalty rates as to the third target. Subsequent to a GSK strategic portfolio prioritization, the Company received notice in October 2017 that GSK terminated the agreement with respect to the third target, effective December 31, 2017, which returned all rights to that target to the Company. On December 16, 2021, the Company received written notice from GSK that GSK elected to terminate the Collaboration and License Agreement without cause, and in accordance with the terms of the agreement and the notice of termination, the termination will be effective on March 16, 2022 . As a result of the termination of the agreement, as of the termination effective date, the license rights granted by the Company to GSK will terminate, GSK will cease to accrue any financial obligations to the Company and the Company will be entitled to pursue the PRMT5 and PRMT1 targets in all fields worldwide without further obligation to GSK. The Company substantially completed all of its obligations under this agreement by the end of 2015. The termination of the agreement had no impact on the Company’s financial statements.

Eisai

In April 2011, the Company entered into a collaboration and license agreement with Eisai, under which the Company granted Eisai an exclusive worldwide license to its small molecule HMT inhibitors directed to the EZH2 HMT, including the Company’s product candidate tazemetostat, while retaining an opt-in right to co-develop, co-commercialize and share profits with Eisai as to licensed products in the United States.

As of December 31, 2014, the Company had completed its performance obligations under the original agreement.

In March 2015, the Company entered into an amended and restated collaboration and license agreement with Eisai (the “Eisai License Agreement”), under which the Company reacquired worldwide rights, excluding Japan, to its EZH2 program, including tazemetostat. Under the Eisai License Agreement, the Company is responsible for global development, manufacturing and commercialization outside of Japan of tazemetostat and any other EZH2 product candidates, with Eisai retaining development and commercialization rights in Japan, as well as a right to elect to manufacture tazemetostat and any other EZH2 product candidates in Japan, and a right of first negotiation for the rest of Asia. Eisai waived its right of first negotiation for the rest of Asia in 2018.

Under the original collaboration and license agreement, Eisai was solely responsible for funding all research, development and commercialization costs for EZH2 compounds. Under the Eisai License Agreement, the Company is solely responsible for funding global development, manufacturing and commercialization costs for EZH2 compounds outside of Japan, including the remaining development costs due under a companion diagnostics agreement with Roche Molecular Systems, Inc., or Roche Molecular, which was amended to assign all of Roche Molecular’s rights and obligations under the companion diagnostics agreement to Roche Sequencing, effective January 1, 2020. Eisai is solely responsible for funding Japan-specific development and commercialization costs for EZH2 compounds.

The Company recorded the reacquisition of worldwide rights, excluding Japan, to the EZH2 program, including tazemetostat, under the Eisai License Agreement, as an acquisition of an in-process research and development asset. As this asset was acquired without corresponding processes or activities that would constitute a business, had not achieved regulatory approval for marketing and, absent obtaining such approval, had no alternative future use, the Company recorded the $40.0 million upfront payment made to Eisai in March 2015 as research and development expense in the consolidated statements of operations and comprehensive loss. The Company also agreed to pay Eisai up to $70.0 million in clinical development and regulatory milestones, all of which have been paid, and royalties at a percentage in the mid-teens on worldwide net sales of any EZH2 product, excluding net sales in Japan. The Company is eligible to receive from Eisai royalties at a percentage in the mid-teens on net sales of any EZH2 product in Japan.

During the years ended December 31, 2020 and 2019, Eisai purchased drug product from the Company at cost to facilitate development within Japan under the Eisai License Agreement and the Company recognized approximately $5.3 million and $3.8 million, respectively, as a reduction to research and development expense.

During the years ended December 31, 2021 and 2020, the Company recorded $4.6 million and $1.7 million, respectively related to worldwide royalties due under the Eisai License Agreement in cost of product revenue based on U.S. sales of TAZVERIK and as of December 31, 2021 and 2020, $1.7 million and $0.7 million, respectively in royalties were payable under the Eisai License Agreement.

As of December 31, 2021, and 2020, the Company had accounts receivable of less than $0.1 million, respectively, due from Eisai. For additional information regarding certain of the Eisai royalties, see Note 12, Sale of Future Royalties.

In March 2021, the Company and Eisai entered into a supply agreement providing for the manufacture and supply to Eisai of tazemetostat drug product. Under the terms of the supply agreement, the Company also agreed to waive its right of exclusive supply of tazemetostat drug substance from the Company’s drug substance manufacturer. During the year ended December 31, 2021, the Company recognized $6.3 million related to the Company’s waiver of its exclusive right to supply of tazemetostat drug substance from the Company’s drug substance manufacturer and delivery of tazemetostat drug product in collaboration and other revenue.

Roche

In December 2012, Eisai and the Company entered into a companion diagnostics agreement with Roche Molecular, under which Eisai and the Company engaged Roche Molecular to develop a companion diagnostic to identify patients who possess certain activating mutations of EZH2. In October 2013, this agreement was amended to include additional mutations in EZH2. The development costs due under the amended agreement with Roche Molecular were the responsibility of Eisai until the execution of the amended and restated collaboration and license agreement with Eisai in March 2015, at which time the Company assumed responsibility for the remaining development costs due under the agreement. In December 2015, the Company and Eisai entered into a second amendment to the companion diagnostics agreement with Roche Molecular. The agreement was further amended in March 2018. Under the amended agreement, the Company was responsible for remaining development costs of $10.4 million due under the agreement as of March 2018 and Eisai agreed to reimburse the Company $0.9 million of this amount related to a regulatory milestone for Japan. In July 2019, the Company entered into a fourth amendment to the companion diagnostics agreement. Under the amended agreement, the Company and Roche Molecular agreed to divide a $1.0 million regulatory milestone for the United States into two separate milestone payments, of which $0.5 million was paid by the Company as part of the signed amendment, and the remaining $0.5 million was paid by the Company in December 2019 upon the satisfaction of certain conditions set forth in the fourth amendment to the companion diagnostics agreement. As part of this fourth amendment, Roche Molecular also assigned all of its rights and obligations under the companion diagnostics agreement to Roche Sequencing due to a reorganization at Roche group, and this assignment became effective as of January 1, 2020. As of December 31, 2021, the Company is responsible for the remaining development costs of $1.0 million due under the agreement. The $0.9 million that Eisai agreed to reimburse the Company related to a regulatory milestone for Japan was achieved as of June 30, 2020 and payment received in the fourth quarter of 2020. In addition, the Company paid $1.0 million for the achievement of a development milestone in the fourth quarter of 2020.

Under the agreement with Roche Sequencing, Roche Sequencing is obligated to use commercially reasonable efforts to develop and to make commercially available the companion diagnostic. Roche Sequencing has exclusive rights to commercialize the companion diagnostic. On June 18, 2020 the FDA approved the companion diagnostic that is intended to identify follicular lymphoma patients with an EZH2 mutation for treatment with tazemetostat.

The agreement with Roche Sequencing will expire when the Company and Eisai are no longer developing or commercializing tazemetostat. The Company and Eisai may terminate the agreement by giving Roche Sequencing 90 days’ written notice if the Company and Eisai discontinue development and commercialization of tazemetostat or determine, in conjunction with Roche Sequencing, that the companion diagnostic is not needed for use with tazemetostat. Any party may also terminate the agreement in the event of a material breach by any party, in the event of material changes in circumstances that are contrary to key assumptions specified in the agreement or in the

event of specified bankruptcy or similar circumstances. Under specified termination circumstances, Roche Sequencing may become entitled to specified termination fees.

Boehringer Ingelheim

In November 2018, the Company entered into a collaboration and license agreement with Boehringer Ingelheim International GmbH (“Boehringer Ingelheim”) to discover, research, develop and commercialize small molecule compounds that are inhibitors of an undisclosed histone acetyltransferase, or HAT, target and an undisclosed helicase target, along with associated predictive biomarkers (the “Target Projects”). Under the terms of the agreement, the Company granted to Boehringer Ingelheim an exclusive, worldwide license to the undisclosed target inhibitors technology. The agreement also included reciprocal licenses to utilize each other’s know-how, patents and technologies for activities under the agreement. Further, each party was granted the license to develop, manufacture, commercialize and otherwise exploit any compound or product that successfully achieves start of lead optimization (“SoLO”). The Company was also obligated to provide R&D services through SoLO approval for both Target Projects, and to serve on the Joint Steering Committee (“JSC”) throughout the term of the contract. The parties were to jointly research and develop the shared helicase target program and will share commercialization activities within the United States. Boehringer Ingelheim had agreed to assume responsibility for commercialization outside of the United States. On December 21, 2020, the Company received written notice from Boehringer Ingelheim that it elected to terminate the Collaboration Agreement without cause, and in accordance with the terms of the Collaboration Agreement. The termination became effective on January 31, 2021. The Target Project for the helicase target and the reciprocal licenses terminated as of this date. The Company is entitled to pursue the HAT target and helicase target programs in all fields worldwide without further obligation to Boehringer Ingelheim.

Agreement Structure

Under the terms of the agreement, the Company received a $15.0 million upfront payment and $5.0 million in research funding for the costs to be incurred by the Company in connection with its research activities, payable quarterly in four equal installments during 2019. At its discretion, Boehringer Ingelheim had the option to extend the research period by up to one year, subject to the Company’s agreement to the specified research activities and additional research funding. During the third quarter of 2019, Boehringer Ingelheim’s option to extend the research period expired unexercised, and therefore the research period ended on December 31, 2019. In March 2020, the Company and Boehringer Ingelheim amended the agreement to extend the research period for the shared program targeting enzymes within helicase families with Boehringer Ingelheim providing research funding of $0.4 million. Additionally, in March 2020, the Company received notice of termination for the program targeting enzymes with HAT families, which program termination became effective in June 2020. In September 2020, the Company and Boehringer Ingelheim further amended the agreement to extend the research period for the shared program targeting enzymes within helicase families with Boehringer Ingelheim to provide research funding of $0.1 million. The additional research activities were completed prior to the end of 2020.

Collaboration Revenue

Through December 31, 2021, the Company has recognized $26.0 million in total collaboration revenue since the inception of this collaboration. During the years ended December 31, 2021, 2020 and 2019, the Company recognized revenue of $0, $0.5 million and $23.8 million, respectively. The Company will not receive any additional revenue under the terms of its agreement with Boehringer Ingelheim.

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Sale of Future Royalties

12 Months Ended

Dec. 31, 2021

Deferred Revenue Disclosure [Abstract]

Sale of Future Royalties

12. Sale of Future Royalties

On November 4, 2019, the Company entered into a loan agreement with BioPharma Credit PLC, or the Collateral Agent, and the Lenders, providing for up to $70.0 million in secured term loans to be advanced in up to three tranches, or the Loan Agreement. As of December 31, 2020, the Company had borrowed an aggregate principal amount under the first tranche of $25.0 million (the “Tranche A Note Payable”), the second tranche of $25.0 million (the “Tranche B Note Payable”), and the third tranche of $20.0 million (the “Tranche C Note Payable”) under the Loan Agreement. On November 3, 2020, the Company, the Collateral Agent and the Lenders amended and restated the Loan Agreement, (as amended and restated, the “Amended and Restated Loan Agreement”), to provide for, among other things, an additional secured term loan of $150.0 million, or the Tranche D Loan. On November 18, 2020, the Company borrowed the Tranche D Loan (See Note 13, Long-Term Debt).

On November 4, 2019, the Company also executed a purchase agreement (the “RPI Purchase Agreement”) with RPI. Pursuant to the RPI Purchase Agreement, the Company agreed to sell to RPI 6,666,667 shares of its common stock, a warrant to purchase up to 2,500,000 shares of common stock at an exercise price of $20.00 per share (the “Common Stock Warrant”), and all of the Company’s rights to receive royalties from Eisai with respect to net sales by Eisai of tazemetostat products in Japan pursuant to the Eisai License Agreement and any successor arrangement for Japan sales (the “Japan Royalty”, and collectively, the “Transaction”). In consideration for the sale of shares of common stock, the Common Stock Warrant and the Japan Royalty, RPI paid the Company $100.0 million upon the closing of the RPI Purchase Agreement. In addition, RPI agreed, in connection with RPI’s acquisition from Eisai of the right to receive royalties from the Company under the Eisai License Agreement, to reduce the Company’s royalty obligation by low single digits upon the achievement of specified annual net sales levels over $1.5 billion. In addition, under the RPI Purchase Agreement, the Company had the right to sell, and RPI had the obligation to purchase, subject to certain conditions, including a maximum purchase price of $20.00 per share, $50.0 million of shares of common stock at the Company’s option for an 18-month period from the date of execution of the RPI Purchase Agreement (the “Put Option”). In February 2020, the Company sold 2.5 million shares of its common stock to RPI, for an aggregate of $50.0 million in proceeds pursuant to the Put Option. Additionally, under the terms of the RPI Purchase Agreement, the founder and chief executive officer of RP Management, an affiliate of RPI, and a co-founder of Pharmakon Advisors LP, an affiliate of the Lenders was elected as a director of the Company. As of December 31, 2021 and 2020, RPI and its affiliates owned approximately 8.6% and 9.0% of the Company’s common stock, respectively.

The Company accounted for the Loan Agreement and RPI Purchase Agreement as a single arrangement as RPI and the Lenders are related parties and the agreements were negotiated together. The aggregate proceeds of $125.0 million were allocated on a relative fair value basis, which approximated their respective actual fair values, to the four units of accounting pursuant to the transaction as follows: (1) $79.0 million to the common stock issued to RPI based on the closing price of the Company’s common stock on the date of the transaction, (2) $8.4 million to the Common Stock Warrant to purchase shares of common stock, based on the Black-Scholes option pricing model, (3) $12.6 million to the liability related to the sale of future royalties based on a discounted cash flow model and (4) $25.0 million to the Tranche A Note Payable based on the terms of the Loan Agreement. Transaction costs of $2.0 million were allocated directly to the units of accounting it relates to.

Although the Company sold all of its rights to receive the Japan Royalty, under the terms of the RPI Agreement, the Company continues to own all tazemetostat intellectual property rights and at execution had significant continuing involvement in the generation of these royalties. Due to the Company’s continuing involvement, the Company will continue to account for any royalties due as revenue and recorded the proceeds from this transaction as a liability (“Royalty Obligation”) that will be accreted using the effective interest method over the estimated life of the RPI Purchase Agreement.

As royalties are remitted to RPI from Eisai, the balance of the Royalty Obligation will be effectively repaid over the life of the Eisai License Agreement. In order to determine the accretion of the Royalty Obligation, the Company is required to estimate the total amount of future royalty payments to RPI over the life of the Eisai License Agreement. The $12.6 million recorded at execution will be accreted to the total of these royalty payments as interest expense

over the life of the Royalty Obligation. At execution, the Company’s estimate of this total interest expense resulted in an effective annual interest rate of approximately 9.01%. This estimate contains significant assumptions that impact both the amount recorded at execution and the interest expense that will be recognized over the royalty period. The Company periodically assesses the estimated royalty payments to RPI from Eisai and to the extent the amount or timing of such payments is materially different than the original estimates, an adjustment is made to the effective interest rate, which will be recorded prospectively to increase or decrease interest expense. There are a number of factors that could materially affect the amount and timing of royalty payments to RPI from Eisai, and correspondingly, the amount of interest expense recorded by the Company, most of which are not within the Company’s control. Such factors include, but are not limited to, delays or discontinuation of development of tazemetostat in Japan, regulatory approval, changing standards of care, the introduction of competing products, manufacturing or other delays, generic competition, intellectual property matters, adverse events that result in governmental health authority imposed restrictions on the use of the drug products, significant changes in foreign exchange rates as the royalties remitted to RPI are made in U.S. dollars (USD) while the underlying Japan sales of tazemetostat will be made in currencies other than USD, and other events or circumstances that are not currently foreseen as tazemetostat is still under development in Japan and subject to regulatory approval. Changes to any of these factors could result in increases or decreases to both royalty revenues and interest expense. On June 23, 2021, Eisai announced that it had obtained manufacturing and marketing approval for the EZH2 inhibitor “Tazverik® Tablets 200 mg” (tazemetostat hydrobromide) in Japan with the indication of relapsed or refractory EZH2 gene mutation-positive follicular lymphoma (only when standard treatment is not applicable), which caused the Company to reassess the estimated future royalty payments to RPI. As of December 31, 2021, the Company’s assessment of the estimated future royalty payments to RPI resulted in a current effective interest rate of approximately 9.19%.

The following table shows the activity of the Royalty Obligation since the transaction inception through December 31, 2021:

	Year Ended December 31, 2021
	(In thousands )
Proceeds from sale of future royalties	$	12,601
Non-cash royalty revenue		(31	)
Non-cash interest expense recognized		3,357
Liability related to the sale of future royalties - ending balance		15,927
Less current portion		(273	)
Related party liability related to sale of future royalties, net of current portion	$	15,654

During the year ended December 31, 2021, the Company recorded non-cash royalties from net sales of tazemetostat in Japan of less than $0.1 million. During the years ended December 31, 2020 and 2019, the Company did not record non-cash royalties from net sales of tazemetostat in Japan. During the years ended December 31, 2021, 2020 and 2019 the Company recorded $1.8 million, $1.4 million and $0.2 million, respectively, of related non-cash interest expense.

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Long-Term Debt

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Long-Term Debt

13. Long-Term Debt

On November 4, 2019, the Company entered into the Loan Agreement, which provided for up to $70.0 million in secured term loans to be advanced in up to three tranches. The Company borrowed $70.0 million in the aggregate under the three tranches pursuant to the Loan Agreement. With the FDA’s June 2020 approval of tazemetostat for the treatment of FL in the United States, the Company also had the right, but not the obligation, to request up to an additional $300.0 million in secured term loans, subject to the approval of the Lenders, provided the Company has not prepaid any outstanding term loans at the time of such request and such request is made before November 18, 2021. On November 3, 2020, the Company entered into the Amended and Restated Loan Agreement with the Lenders. The Amended and Restated Loan Agreement provides for, among other things, an additional secured term loan of $150.0 million, or the Tranche D Loan. On November 3, 2020, the Company also delivered written notice to the Lenders to draw down the Tranche D Loan, which was funded on November 18, 2020. The Company paid a commitment fee of 2.00% of the original $70.0 million committed facility amount in November 2019 and 2% of the $150.0 million Tranche D Loan in November 2020, as well as expenses incurred by the Lender in executing the agreements.

The interest rate for the Tranche D Loan will be determined by reference to a Eurodollar rate plus 7.75% above such Eurodollar rate. The Eurodollar rate will have a 2.00% floor. The Tranche D Loan will be due in eight equal quarterly principal payments commencing on the 51st month anniversary of the date on which the Lenders fund the Tranche D Loan. All unpaid principal and interest under the Tranche D Loan will be due and payable on the 72nd month anniversary of the date on which the Lenders funded the Tranche D Loan.

The Amended and Restated Loan Agreement also amended the payment period principal and interest for the first three tranches of term loans. Under the original terms, the Company was required to make interest only payments on the outstanding obligation through February 28, 2023, and thereafter eight quarterly payments of principal and interest. Under the amended and restated terms, the Company is required to make interest only payments on the $70.0 million outstanding obligation through November 2023, and thereafter four quarterly payments of principal and interest. All unpaid principal and interest on the $70.0 million borrowed under the original Loan Agreement is due and payable in November 2024, the 60th month anniversary of the date on which the Lenders funded the first tranche of term loans. The interest rates for the existing tranches of term loans remain unchanged and will continue to be determined by reference to a Eurodollar rate plus 7.75% above such Eurodollar rate. The Eurodollar rate will have a 2.00% floor.

Each of the four term loans may be prepaid before maturity in whole or in part, however there is a $50.0 million minimum prepayment for any prepayment of the loans. If the Company prepays any tranche of term loans, in whole or in part, during the first 36 months from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to the greater of (x) a make-whole amount equal to the interest that would have accrued on the principal amount to be prepaid and (y) a premium equal to 0.03 multiplied by the principal amount to be prepaid. If the Company prepays a tranche of term loan, in whole or in part, between the 36th month and 48th month from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to 0.02 multiplied by the principal amount to be prepaid. If the Company prepays a tranche of term loans, in whole or in part, between the 48th month and 60th month from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to 0.01 multiplied by the principal amount to be prepaid.

The Amended and Restated Loan Agreement was accounted for as a debt modification based on a comparison of the present value of the cash flows under the terms of the debt immediately before and after the effective date of The Amended and Restated Loan Agreement, which resulted in a change of less than 10%. As a result, issuance costs paid to the Lenders in connection with The Amended and Restated Loan Agreement were recorded as a reduction of the carrying amount of the debt liability and unamortized issuance costs as of the date of the modification are amortized to interest expense over the repayment term of The Amended and Restated Loan Agreement.

The obligations under the Amended and Restated Loan Agreement, including the Company’s payment obligations in respect of the Tranche D Loan are secured by the first priority security interest in and a lien on substantially all of the assets of the Company, subject to certain exceptions, that the Company granted to the Lenders in connection with the first tranche of term loans under the Loan Agreement.

The Amended and Restated Loan Agreement contains certain customary representations and warranties, affirmative and negative covenants and events of default applicable to the Company and its subsidiaries. If an event of default occurs and is continuing, the Collateral Agent may, among other things, accelerate the loans and foreclose on the collateral. The Company has determined that the risk of subjective acceleration under the material adverse events clause is not probable and therefore has classified the outstanding principal in non-current liabilities based on scheduled principal payments.

The Company has the following minimum aggregate future loan payments at December 31, 2021 (in thousands):

	Year Ended December 31, 2021
2022		—
2023		—
2024		70,000
2025		75,000
2026		75,000
Total minimum payments		220,000
Less amounts representing interest and discount		(3,539	)
Less current portion		—
Related party long-term debt, net of debt discount	$	216,461

For the years ended December 31, 2021, 2020 and 2019, interest expense related to the Company's Amended and Restated Loan Agreement was approximately $22.5 million, $7.2 million and $0.3 million, respectively. The total carrying value of debt is classified as long-term on the Company's consolidated balance sheet as of December 31, 2021 and 2020, respectively.

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Stockholders' Equity (Deficit)

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Stockholders' Equity (Deficit)

14. Stockholders’ Equity (Deficit)

Common Stock

On March 24, 2020, the Company’s board of directors adopted, subject to stockholder approval, an amendment to the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of common stock, $0.0001 par value per share, from 125,000,000 to 150,000,000 (the “Charter Amendment”). At the Company’s 2020 Annual Meeting of Stockholders, the stockholders of the Company approved the Charter Amendment, which was filed with the Secretary of State of the State of Delaware on May 29, 2020. On April 8, 2021, the Company’s board of directors adopted, subject to stockholder approval, an amendment to the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of common stock from 150,000,000 to 225,000,000 (the "2021 Charter Amendment"). At the Company’s 2021 Annual Meeting of Stockholders, the stockholders of the Company approved the 2021 Charter Amendment, which was filed with the Secretary of State of the State of Delaware on June 11, 2021. The number of authorized shares of preferred stock was not affected by these Charter Amendments.

Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to dividends when and if declared by the board of directors.

2021 At-the-Market Offering Program

On May 6, 2021, the Company entered into an Open Market Sale AgreementSM (“ATM Sale Agreement”), with Jefferies LLC (“Jefferies”) to sell, from time to time, shares of the Company's common stock having an aggregate offering price of up to $200.0 million through an “at the market offering” as defined in Rule 415 under the Securities Act of 1933, as amended, under which Jefferies would act as sales agent (the "ATM Offering"). The shares that may be sold under the ATM Sale Agreement, if any, are issued and sold pursuant to the Company’s shelf registration statement on Form S-3 that was declared effective by the Securities and Exchange Commission on May 13, 2021. The Company agreed to compensate Jefferies at a fixed commission rate equal to 3.0% of the gross sales proceeds of such shares.

From the initiation of the ATM Offering through December 31, 2021, the Company has issued and sold 3,840,977 shares under the ATM Offering, resulting in aggregate net proceeds of $16.0 million after deducting issuance costs of $0.5 million.

RPI Put Option

In February 2020, the Company sold 2,500,000 shares of its common stock in connection with the exercise of its Put Option to sell shares of its common stock for an aggregate of $49.9 million in net proceeds after deducting financing costs of $0.1 million. (see Note 12, Sale of Future Royalties).

Convertible Preferred Stock

The Company has 337,800 shares of Series A Convertible Preferred Stock outstanding as of December 31, 2021 and 2020.

Voting Rights

Shares of Series A Preferred Stock will generally have no voting rights except as required by law and except that the consent of the holders of a majority of the outstanding shares of Series A Preferred Stock will be required to amend the terms of the Series A Preferred Stock or take certain other actions with respect to the Series A Preferred Stock.

Dividends

Shares of Series A Preferred Stock will be entitled to receive dividends equal to (on an as-if-converted-to-common stock basis), and in the same form and manner as, dividends actually paid on shares of the Company’s common stock.

Liquidation Rights

Subject to the prior and superior rights of the holders of any senior securities of the Company, upon liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, each holder of shares of Series A Preferred Stock shall be entitled to receive, in preference to any distributions of any of the assets or surplus funds of the Company to the holders of common stock, an amount equal to $0.001 per share of Series A Preferred Stock, plus an additional amount equal to any dividends declared but unpaid on such shares, before any payments shall be made or any assets distributed to holders of any class of common stock.

If, upon any such liquidation, dissolution or winding up of the Company, the assets of the Company shall be insufficient to pay the holders of shares of the Series A Preferred Stock the amount required under the preceding sentence, then all remaining assets of the Company shall be distributed ratably to holders of the shares of the Series A Preferred Stock in proportion to the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on or with respect to such shares were paid in full.

Conversion

Each share of Series A Preferred Stock shall be convertible, at any time and from time to time from and after the issuance date, at the option of the holder thereof, into a number of shares of common stock equal to 10 shares of common stock, provided that the holder will be prohibited from converting Series A Preferred Stock into shares of the Company’s common stock if, as a result of such conversion, the holder, together with its affiliates and attribution parties, would own more than 9.99% of the total number of shares of common stock then issued and outstanding. The holder can change this requirement to a higher or lower percentage, not to exceed 9.99% of the number of shares of common stock outstanding, upon 61 days’ notice to the Company.

In February 2020, 12,200 shares of Series A Preferred Stock were converted to 122,000 shares of common stock.

Redemption

The Company is not obligated to redeem or repurchase any shares of Series A Preferred Stock. Shares of Series A Preferred Stock are not entitled to any redemption rights or mandatory sinking fund or analogous fund provisions.

Warrants

In November 2019, the Company issued the Common Stock Warrant for the purchase of up to 2,500,000 shares of Common Stock at an exercise price of $20.00 per share to RPI pursuant to the RPI Purchase Agreement (for additional information see Note 12, Sale of Future Royalties), which was classified as equity and recorded at its relative fair value of $8.4 million to additional paid-in-capital on the Company's consolidated balance sheets. The Common Stock Warrant remains outstanding as of December 31, 2021.

In August 2021, the Company issued the HutchMed Warrant to HutchMed under the HutchMed License Agreement, exercisable at any time prior to August 7, 2025 for up to 5,653,000 shares of the Company’s common stock at an exercise price of $11.50 per share. Under the HutchMed Warrant, the number of shares issuable under the warrant is reduced from 5,653,000 to 2,826,500 in the event that the HutchMed License Agreement is terminated for certain reasons as more fully described in the HutchMed License Agreement. Due to this provision, the Company concluded that the warrant does not meet the exception from derivative accounting pursuant to ASC 815, Derivatives and Hedging, which requires that the warrant be accounted for as a derivative. Accordingly, the Company recorded a warrant liability in the amount of approximately $13.0 million upon issuance. The fair value of the HutchMed Warrant was determined using a Black-Scholes and Monte Carlo pricing model.

The HutchMed Warrant is subject to revaluation at each balance sheet date and any changes in fair value are recorded as a non-cash gain or (loss) in the Company's consolidated statement of operations and comprehensive loss as a component of other income (expense), net until the earlier of the exercise or expiration of the HutchMed Warrant or upon the completion of a liquidation event.

The Company recorded non-cash gains of approximately $11.1 million during 2021 in its consolidated statement of operations and comprehensive loss attributable to the decreases in the fair value of the warrant liability that resulted from a reduction in the Company's stock price as of December 31, 2021.

The following table rolls forward the fair value of the HutchMed Warrant liability, the fair value of which is determined by Level 3 inputs at inception on August 7, 2021, and as of December 31, 2021:

		(In thousands)
Fair value at inception	$		13,050
Decrease in fair value			(11,120	)
Fair value at December 31, 2021	$		1,930

The key assumptions used to value the HutchMed Warrant were as follows:

	Inception			As of December 31, 2021
Risk-free interest rate		0.6	%		1.05	%
Expected term (in years)	4.0 years			3.6 years
Expected volatility of underlying stock		70.0	%		70.0	%
Expected dividend yield		-			-
Stock price	$	6.47		$	2.50

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Employee Benefit Plans

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Employee Benefit Plans

15. Employee Benefit Plans

Stock Incentive Plans

The Company maintains one stock incentive plan, the 2013 Stock Incentive Plan, as well as the 2013 Employee Stock Purchase Plan.

In addition, during the year ended December 31, 2021, the Company granted options to purchase an aggregate of 248,366 shares of Epizyme common stock and 106,955 restricted stock units (RSUs) to four new employees as equity inducement awards outside of the Company's 2013 Stock Incentive Plan and material to the employees’ acceptance of employment with the Company. These equity awards were approved in accordance with Nasdaq Listing Rule 5635(c)(4), and these equity awards remained outstanding as of December 31, 2021. The options have a weighted average exercise price of $5.12 per share, and the RSUs have a weighted average grant date fair value of $5.08 per unit. These inducement awards are included in stock-based compensation expense and the following tables.

Stock-Based Compensation Expense

Stock-based compensation expense is classified in the consolidated statements of operations and comprehensive loss as follows:

	Year Ended December 31,
	2021		2020		2019
	(In thousands)
Research and development	$	8,360	$	9,093	$	6,295
General and administrative		18,427		18,516		11,721
Total	$	26,787	$	27,609	$	18,016

Stock Options

The weighted-average grant date fair value of options, estimated as of the grant date using the Black-Scholes option-pricing model. Weighted average assumptions used in this pricing model on the date of grant for options granted to employees are as follows:

	Year Ended December 31,
	2021			2020			2019
Risk-free interest rate		0.7	%		0.9	%		2.2	%
Expected life of options	5.89 years			5.99 years			6.0 years
Expected volatility of underlying stock		70.0	%		70.9	%		72.0	%
Expected dividend yield		0.0	%		0.0	%		0.0	%

The following is a summary of stock option activity for the year ended December 31, 2021:

	Number of Options			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
	(In thousands)					(In years)		(In thousands)
Outstanding at December 31, 2020		10,225		$	14.77
Granted		6,422			7.81
Exercised		(104	)		8.83
Forfeited or expired		(3,597	)		13.88
Outstanding at December 31, 2021		12,946		$	11.61		7.62	$	-
Exercisable at December 31, 2021		5,463		$	14.39		5.82	$	-

During the years ended December 31, 2021, 2020 and 2019, the Company granted stock options to purchase an aggregate of 6,421,792 shares, 3,522,258 shares, and 4,222,693 shares, respectively, at weighted-average grant date fair values per option share of $4.79, $11.69, and $6.99, respectively. The total grant date fair value of options that vested during the years ended December 31, 2021, 2020 and 2019 was $27.2 million, $17.4 million, and $13.2 million, respectively. The aggregate intrinsic value of stock options exercised was $0.1 million in 2021, $5.5 million in 2020 and $1.2 million in 2019.

As of December 31, 2021, there was $37.3 million in unrecognized stock-based compensation related to stock options that are expected to vest. These costs are expected to be recognized over a weighted average remaining vesting period of 2.3 years.

Restricted Stock Units

During the year-ended December 31, 2021, 2,240,217 restricted stock units (“RSUs”) were granted to executives and employees and 105,944 RSUs were granted to non-employee directors. The awards were service-based. Assuming all service conditions are achieved, the executive and employee RSUs will vest as to 50%, 33%, and 25%, respectively, of the shares of Company common stock underlying the RSUs on an annual basis over two, three, or four year period of time from the grant dates, respectively, and the non-employee director RSUs will vest as to 100% of the shares of Company common stock underlying the RSUs in full on the earlier of the first anniversary of the grant date and the date of the succeeding annual meeting of stockholders.

	Number of Units			Weighted Average Grant Date Fair Value per Unit
	(In thousands except per share data)
Outstanding at December 31, 2020		668		$	17.56
Granted		2,346			7.74
Vested		(187	)		17.20
Forfeited		(605	)		12.15
Outstanding at December 31, 2021		2,222		$	8.70

Compensation expense totaling $4.9 million, $2.7 million, and $0.5 million was recognized for the service-based RSUs for the years-ended December 31, 2021, 2020 and 2019, respectively.

As of December 31, 2021, there was $14.3 million of unrecognized compensation cost related to service-based RSUs that are expected to vest. These costs are expected to be recognized over a weighted average remaining vesting period of 2.2 years.

During 2019, the Company granted 604,000 RSUs to executives and employees, which contained performance conditions, 20% of the RSUs vested on June 30, 2019, 25% of the RSUs vested on January 23, 2020, 20% of the RSUs vested on March 24, 2020, and 30% of the RSUs vested on June 25, 2020 in connection with achievement of the final performance milestone.

Compensation expense totaling $3.5 million and $3.6 million was recognized for the performance-based RSUs for the years-ended December 31, 2020 and 2019, respectively.

There was no unrecognized compensation cost as of December 31, 2020, related to performance-based RSUs, as all of the performance conditions have been achieved.

401(k) Savings Plan

The Company has a defined contribution 401(k) savings plan (the “401(k) Plan”). The 401(k) Plan covers substantially all employees, and allows participants to defer a portion of their annual compensation on a pretax basis. Company contributions to the 401(k) Plan may be made at the discretion of the board of directors. During the year

ended December 31, 2014, the Company implemented a matching contribution to the 401(k) Plan, matching 50% of an employee’s contribution up to a maximum of 3% of the participant’s compensation. Company contributions to the 401(k) plan totaled $1.4 million, $1.2 million and $0.6 million in the years ended December 31, 2021, 2020 and 2019, respectively.

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Loss per Share

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Loss per Share

16. Loss per Share

As described in Note 2, Summary of Significant Accounting Policies, the Company computes basic and diluted earnings (loss) per share using a methodology that gives effect to the impact of outstanding participating securities (the “two-class method”). The two-class method was not applied for the years ended December 31, 2021, 2020, and 2019 due to the net loss recognized in each of those periods. In 2019 the net loss applicable to common stockholders did not equal net loss due to the accretion of the beneficial conversion feature of Series A Preferred Stock in the amount of $2.9 million. The beneficial conversion feature was initially recorded as a discount on the Series A Preferred Stock with a corresponding amount recorded to Additional Paid-in Capital. The discount on the Series A Preferred Stock was then immediately written off as a deemed dividend as the Series A Preferred Stock does not have a stated redemption date and is immediately convertible at the option of the holder.

Basic and diluted loss per share allocable to common stockholders are computed as follows:

	Year Ended December 31,
	2021			2020			2019
	(In thousands except per share data)
Net loss	$	(251,122	)	$	(231,694	)	$	(170,295	)
Accretion of Series A Preferred Stock		—			—			(2,940	)
Net loss attributable to common stockholders	$	(251,122	)	$	(231,694	)	$	(173,235	)
Weighted average shares outstanding		102,646			100,960			89,891
Basic and diluted loss per share allocable to common stockholders	$	(2.45	)	$	(2.29	)	$	(1.93	)

The following common stock equivalents were excluded from the calculation of diluted loss per share allocable to common stockholders because their inclusion would have been anti-dilutive:

	Year Ended December 31,
	2021		2020		2019
	(In thousands)
Stock options		12,946		10,225		8,087
Restricted stock units		2,222		669		757
Shares issuable under employee stock purchase plan	155		98		38
Series A Preferred Stock (if converted)		3,378		3,378		3,500
Warrants		8,153		2,500		2,500
		26,854		16,870		14,882

For the year ended December 31, 2019, the above table does not include the up to 6,250,000 shares subject to the Company’s option to sell additional shares to RPI pursuant to the Put Option as the decision to exercise this option was within the Company’s control. On December 30, 2019, the Company exercised its option to sell 2,500,000 shares of Common Stock to RPI for an aggregate of $50.0 million. The sale was effected on February 11, 2020.

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Subsequent Events

12 Months Ended

Dec. 31, 2021

Subsequent Events [Abstract]

Subsequent Events

17. Subsequent Events

Common Stock Offering

In January 2022, the Company raised approximately $79.5 million in net proceeds (after deducting underwriting discounts and commissions and estimated offering costs, but excluding any expenses and other costs reimbursed by

the underwriters) from the sale of 56,666,667 shares of its common stock in a public offering at a price of $1.50 per share.

Operating Cost Reduction

On March 1, 2022, the Company announced a cross-functional reduction of approximately 12% of its current workforce under a cost reduction plan. Affected employees will be offered separation benefits, including severance payments along with temporary healthcare coverage assistance. The Company estimates that the severance and termination-related costs will be approximately $2.8 - 3.2 million and expects to record these charges in the first quarter of 2022. The Company expects that payments of these costs will be made through the end of the fourth quarter of 2022.

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

Basis Of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation

The consolidated financial statements of the Company included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC, and in accordance with U.S. generally accepted accounting principles, or GAAP. Any reference in these notes to applicable guidance is meant to refer to the authoritative accounting principles generally accepted in the United States as found in the ASC and Accounting Standards Update, or ASU, of the Financial Accounting Standards Board, or FASB. The consolidated financial statements include the accounts of Epizyme, Inc. and its wholly owned, controlled subsidiary, Epizyme Securities Corporation. All intercompany transactions and balances of subsidiaries have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities, as of the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results and outcomes may differ materially from management’s estimates, judgments and assumptions.

Subsequent Events

Subsequent Events

The Company considers events or transactions that occur after the balance sheet date but before the consolidated financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. The Company evaluated all events and transactions through the date these financial statements were filed with the Securities and Exchange Commission.

Cash and cash equivalents

Cash and cash equivalents

The Company considers all highly liquid securities with original final maturities of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents are comprised of demand deposit accounts, funds in money market accounts, commercial paper and corporate notes.

Marketable securities

Marketable securities

The Company classifies marketable securities with a remaining maturity when purchased of greater than three months as available-for-sale. The Company considers all available-for-sale securities, including those with maturity dates beyond 12 months, as available to support current operational liquidity needs and therefore classifies all securities with maturity dates beyond 90 days at the date of purchase as current assets. Available-for-sale securities are maintained by the Company’s investment managers and may consist of commercial paper, high-grade corporate notes, U.S. Treasury securities, and U.S. government agency securities. Available-for-sale securities are carried at fair value with the unrealized gains and losses included in other comprehensive loss as a component of stockholders’ equity until realized. Any premium or discount arising at purchase is amortized and/or accreted to interest income and/or expense over the life of the instrument. Realized gains and losses are determined using the specific identification method and are included in other income (expense).

The aggregate fair value of securities held by the Company in an unrealized loss position for less than twelve months as of December 31, 2021 was $28.6 million, which consisted of 4 commercial paper securities and 6 U.S. Treasury securities. There were no marketable securities held by the Company for greater than twelve months as of December 31, 2021. The aggregate fair value of securities held by the Company in an unrealized loss position for less than twelve months as of December 31, 2020 was $67.7 million, which consisted of 6 commercial paper securities, 7 corporate notes securities and 1 U.S. Treasury security. There were no marketable securities held by the Company for greater than twelve months as of December 31, 2020.

The Company does not intend to sell and it is unlikely that the Company will be required to sell the above investments before recovery of their amortized cost bases, which may be maturity. The Company determined there

was no material change in the credit risk of the above investments, and as a result, the Company determined it did not hold any investments with an other-than-temporary impairment as of December 31, 2021 and 2020. The Company reviews its portfolio of available-for-sale debt securities, using both quantitative and qualitative factors, to determine if declines in fair value below cost have resulted from a credit-related loss or other factors. If the decline in fair value is due to credit-related factors, a loss is recognized in net income, whereas if the decline in fair value is not due to credit-related factors, the loss is recorded in other comprehensive income (loss).

The following table summarizes the available for sale securities held at December 31, 2021 (in thousands):

Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Commercial paper	$	68,427	$	7	$	(3	)	$	68,431
Corporate notes		—		—		—			—
U.S. government agency securities and U.S. Treasuries		10,025		—		(1	)		10,024
Total	$	78,452	$	7	$	(4	)	$	78,455

The following table summarizes the available for sale securities held at December 31, 2020 (in thousands):

Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Commercial paper	$	158,907	$	14	$	(8	)	$	158,913
Corporate notes		33,437		3		(7	)		33,433
U.S. government agency securities and U.S. Treasuries		13,044		1		—			13,045
Total	$	205,388	$	18	$	(15	)	$	205,391

Certain short-term debt securities with original maturities of less than 90 days are included in cash and cash equivalents within the consolidated balance sheets and are not included in the tables above.

All marketable securities held at December 31, 2021 and December 31, 2020 have maturities of less than one year.

The amortized cost of available-for-sale securities is adjusted for amortization of premiums and accretion of discounts to maturity. At December 31, 2021, the balance in the Company’s accumulated other comprehensive loss was composed mainly of activity related to the Company’s available-for-sale marketable securities. There were no realized gains or losses recognized on the sale or maturity of available-for-sale securities during the year ended December 31, 2021 and December 31, 2020, respectively, and as a result, the Company did not reclassify any amounts out of accumulated other comprehensive loss for the same period.

Restricted Cash

Restricted Cash

A reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows, is as follows:

	December 31,
	2021		2020		2019
	(In thousands)
Cash and cash equivalents	$	98,336	$	168,215	$	139,482
Restricted cash, as part of other assets		1,509		1,509	1509
Total cash, cash equivalents, and restricted cash
shown in the consolidated statements of cash flows	$	99,845	$	169,724	$	140,991

The $1.5 million in restricted cash is comprised of $0.5 million in a letter of credit as a security deposit for the office and laboratory lease at Technology Square in Cambridge, Massachusetts and $1.0 million in a letter of credit as a security deposit for the Company’s office lease at Hampshire Street in Cambridge, Massachusetts. The Company has recorded cash held to secure these letters of credit as restricted cash in restricted cash and other assets on the consolidated balance sheet. The restricted cash is classified as non-current based on the related lease terms.

Fair Value Measurements

Fair Value Measurements

The FASB Codification Topic 820, Fair Value Measurements and Disclosures, requires the use of valuation techniques that are consistent with the market approach, the income approach and/or the cost approach. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. The income approach uses valuation techniques to convert future amounts, such as cash flows or earnings, to a single present amount on a discounted basis. The cost approach is based on the amount that currently would be required to replace the service capacity of an asset (replacement cost). Valuation techniques should be consistently applied. GAAP also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

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

Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s financial instruments as of December 31, 2021 and 2020 consisted primarily of cash and cash equivalents, marketable securities and accounts receivable and accounts payable. As of December 31, 2021 and December 31, 2020, the Company’s financial assets recognized at fair value consisted of the following:

	Fair Value as of December 31, 2021
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents	$	88,637	$	67,209	$	21,428	$	—
Marketable securities:
Commercial paper		68,431		—		68,431		—
Corporate notes		—		—		—		—
U.S. government agency securities and treasuries		10,024		—		10,024		—
Total	$	167,092	$	67,209	$	99,883	$	—

	Fair Value as of December 31, 2020
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents	$	163,264	$	113,505	$	49,759	$	—
Marketable securities:
Commercial paper		158,913		—		158,913		—
Corporate notes		33,433		—		33,433		—
U.S. government agency securities and treasuries		13,045		—		13,045		—
Total	$	368,655	$	113,505	$	255,150	$	—

Cash equivalents and marketable securities have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing third-party pricing services or other market observable data.

The Company measures its cash equivalents at fair value on a recurring basis, which approximates the net asset value per share. The Company classifies some of its cash equivalents within Level 1 of the fair value hierarchy because they are valued using observable inputs that reflect quoted prices for identical assets in active markets. The Company measures its marketable securities at fair value on a recurring basis and classifies those instruments and

some cash equivalents within Level 2 of the fair value hierarchy. The pricing services used by management utilize industry standard valuation models, including both income and market-based approaches and observable market inputs to determine the fair value of marketable securities and those cash equivalents classified within Level 2 of the fair value hierarchy.

As of December 31, 2021, the fair value of the long-term debt, payable in installments through November 18, 2026, approximated its carrying value due to the proximity of the issuance of the Tranche D Loan date to December 31, 2021 (See Note 13, Long-Term Debt).

Amortization of Debt Discount and Issuance Costs

Amortization of Debt Discount and Issuance Costs

Long-term debt is initially recorded at its allocated proceeds, net of discounts and deferred costs. Debt discount and issuance costs, consisting of legal and other fees directly related to the debt, are offset against initial carrying value of the debt and are amortized to interest expense over the estimated life of the debt based on the effective interest method.

Liability Related to Sale of Future Royalties

Liability Related to Sale of Future Royalties

The Company treats the liability related to sale of future royalties as a debt financing, as the Company has significant continuing involvement in the generation of the cash flows, to be amortized to interest expense using the effective interest rate method over the life of the related royalty stream.

The liability related to sale of future royalties and the related interest expense are based on the Company’s current estimates of future royalties expected to be paid over the life of the arrangement. The Company will periodically assess the expected royalty payments using a combination of internal projections and forecasts from external sources. To the extent the Company’s future estimates of royalty payments are greater or less than previous estimates or the estimated timing of such payments is materially different than its previous estimates, the Company will adjust its effective interest rate, which is applied prospectively.

For further discussion of the sale of future royalties, refer to Note 12, Sale of Future Royalties.

Going Concern

Going Concern

At each reporting period, the Company evaluates whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company is required to make certain additional disclosures if it concludes substantial doubt exists about the Company's ability to continue as a going concern within one year after the date that the financial statements are issued and such doubt is not alleviated by the Company’s plans or when its plans alleviate substantial doubt about the Company’s ability to continue as a going concern. The Company’s evaluation entails analyzing prospective operating budgets and forecasts for expectations of the Company’s cash needs, and comparing those needs to its available cash, cash equivalents and marketable securities.

The Company has recurring losses and expects to have recurring losses for the foreseeable future with the continued commercialization of TAZVERIK in ES and FL, the development of tazemetostat in other indications, and the development of the Company’s other product candidates. In addition, the Company has experienced and continues to experience challenges in the continued commercialization of TAZVERIK resulting from the ongoing COVID-19 pandemic, which the Company believes has had an adverse impact on TAZVERIK revenues. In response to the challenges that the Company has continued to face since the Company commenced its launch of TAZVERIK in FL in June 2020, the Company implemented an operational cost reduction plan that was announced on August 9, 2021 and continues to evaluate its costs on an on-going basis with the intent to streamline such costs.

The analysis of the Company’s ability to continue as a going concern for the year ended December 31, 2021 included consideration of the Company’s current cash needs, including its research and development plans, commercialization activities associated with the continued commercialization of TAZVERIK in the ES and FL indications, its existing debt service obligations, and anticipated cost savings resulting from its operational cost reduction plan, including ongoing efforts to eliminate costs not related to the Company’s strategic focus. The analysis included forecasted product revenues from sales of TAZVERIK. Such estimates of future sales contain significant judgment as TAZVERIK was first launched in the first half of 2020 and there is little history with which

to base such estimates. In addition, the Company’s ongoing efforts to eliminate costs not related to the Company’s strategic focus contains uncertainties as to whether the Company can attain such benefits. Based on the analysis, the Company concluded that its available cash, cash equivalents and marketable securities as of December 31, 2021 combined with the $79.5 million raised in January 2022 (see Note 18 for further information) will be sufficient to fund current planned operations and capital expenditure requirements and pay its debt service obligations as they become due into the third quarter of 2023 which is at least 12 months from the filing date of this Annual Report on Form 10-K with the SEC. As a result, the Company concluded that it did not identify conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date these financial statements were issued. The Company’s current operating plan is based on assumptions that may prove to be wrong, and the Company could use its capital resources sooner than it expects, in which case the Company would evaluate further reductions in its expenses or obtaining additional financing sooner than it otherwise would, which additional financing may not be available or may only be available on terms that are not acceptable to the Company.

Accounts Receivable

Accounts Receivable

The Company extends credit to customers based on its evaluation of the customer’s financial condition. The Company records receivables for all billings when amounts are due under standard terms. Accounts receivable are stated at amounts due net of applicable prompt pay discounts and other contractual adjustments as well as an allowance for doubtful accounts. The Company assesses the need for an allowance for doubtful accounts by considering a number of factors, including the length of time trade accounts receivable are past due, the customer’s ability to pay its obligation and the condition of the general economy and the industry as a whole. The Company will write off accounts receivable when the Company determines that they are uncollectible. In general, the Company has experienced no significant collection issues with its customers.

Concentration of Credit Risk

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk include cash, cash equivalents, marketable securities and accounts receivable. The Company attempts to minimize the risks related to cash, cash equivalents and marketable securities by working with highly rated financial institutions that invest in a broad and diverse range of financial instruments as defined by the Company. The Company has established guidelines relative to credit ratings and maturities intended to safeguard principal balances and maintain liquidity. The Company maintains its funds in accordance with its investment policy, which defines allowable investments, specifies credit quality standards and is designed to limit the Company’s credit exposure to any single issuer.

Accounts receivable represent amounts due from customers and collaboration partners. The Company monitors economic conditions to identify facts or circumstances that may indicate that any of its accounts receivable are at risk of collection. For a further discussion of concentration of credit risk see Note 3, Product Revenue, Net.

Property and Equipment

Property and Equipment

The Company records property and equipment at cost. Property and equipment acquired under a capital lease is recorded at the lesser of the present value of the minimum lease payments under the capital lease or the fair value of the leased property at lease inception. The Company calculates depreciation and amortization using the straight-line method over the following estimated useful lives:

Asset Category	Useful Lives
Laboratory equipment	3 - 6 years
Computer and office equipment, and furniture	3 - 10 years
Leasehold improvements	3 - 6 years or term of respective lease, if shorter

Amortization of capital lease assets is included in depreciation expense. The Company capitalizes expenditures for new property and equipment and improvements to existing facilities and charges the cost of maintenance to expense. The Company eliminates the cost of property retired or otherwise disposed of, along with the corresponding accumulated depreciation, from the related accounts, and the resulting gain or loss is reflected in the results of operations.

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets

The Company reviews long-lived assets to be held and used, including property and equipment and intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be recoverable.

Evaluation of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset or asset group and its eventual disposition. In the event that such cash flows are not expected to be sufficient to recover the carrying amount of the asset or asset group, the assets are written down to their estimated fair values. No such impairments were recorded during 2021, 2020 or 2019.

Income Taxes

Income Taxes

The Company records deferred income taxes to recognize the effect of temporary differences between tax and financial statement reporting. The Company calculates the deferred taxes using enacted tax rates expected to be in place when the temporary differences are realized and records a valuation allowance to reduce deferred tax assets if it is determined that it is more likely than not that all or a portion of the deferred tax asset will not be realized. The Company considers many factors when assessing the likelihood of future realization of deferred tax assets, including recent earnings results, expectations of future taxable income, carryforward periods available and other relevant factors. The Company records changes in the required valuation allowance in the period that the determination is made.

The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available as of the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, the Company records the largest amount of tax benefit with a greater than 50.0% likelihood of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, the Company does not recognize a tax benefit in the financial statements. The Company records interest and penalties related to uncertain tax positions, if applicable, as a component of income tax expense. Refer to Note 8, Income Taxes, for additional information regarding the Company’s income taxes.

Other Revenue

Revenue Recognition – Other Revenue

Other revenue consists of revenue from the sales of tazemetostat active pharmaceutical ingredient (API) and drug product to the Company’s licensees or collaborators. The Company recognizes revenue on tazemetostat API and drug product when control has transferred under the terms of each agreement.

Cost of Revenues

Cost of Revenues

Cost of revenues primarily consists of costs related to the sales of TAZVERIK and sales of tazemetostat API and drug product to the Company’s licensees or collaborators. These costs include materials, labor, manufacturing overhead, amortization of milestone payments, and royalties payable on net sales of TAZVERIK. Cost of revenues for the year ended December 31, 2021 included approximately $0.8 million related to sales of tazemetostat drug product. There were no cost of revenues for the sales of tazemetostat drug product during the year ended December 31, 2020 and 2019.

Research and Development Expenses

Research and Development Expenses

Research and development expenses are expensed as incurred. Research and development expenses are comprised of costs incurred in providing research and development activities, including salaries and benefits, facilities costs, overhead costs, contract research and development services, and other outside costs. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made.

External research and development expenses associated with the Company’s programs include clinical trial site costs, clinical manufacturing costs, costs incurred for consultants and other outside services, such as data management and statistical analysis support, and materials and supplies used in support of the clinical and preclinical programs. Internal costs of the Company’s clinical programs include salaries, stock-based compensation, and the portion of the Company’s facility costs allocated to research and development expense. When vendors billing terms do not coincide with the Company’s period-end, the Company is required to make estimates of its obligations to those vendors, including clinical trial and pharmaceutical development costs, contractual services costs and costs for supply of its product candidates incurred in a given accounting period and record accruals at the end of the period. The Company bases its estimates on its knowledge of the research and development programs, services performed for the period, past history for related activities and the expected duration of the vendor service contract, where applicable.

The Company generally accrues expenses related to research and development activities based on the services received and efforts expended pursuant to contracts with multiple contract research organizations that conduct and manage clinical trials, as well as other vendors that provide research and development services. Payments for these activities are based on the terms of the individual arrangements and may result in payment terms that differ from the pattern of costs incurred. There may be instances in which payments made to vendors will exceed the level of services provided and result in a prepayment of the clinical expense. Payments under some of these contracts depend on factors such as the successful enrollment of subjects and the completion of clinical trial milestones. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from estimates, the Company would adjust the accrual or prepaid accordingly in future periods.

Stock-Based Compensation

Stock-Based Compensation

The Company measures employee and non-employee stock-based compensation based on the grant date fair value of the stock-based compensation award. The Company grants stock options at exercise prices equal to the fair value of the Company’s common stock on the date of grant, based on observable market prices.

The Company recognizes employee stock-based compensation expense on a straight-line basis over the requisite service period of the awards. The Company recognizes forfeitures at the time they occur. The actual expense recognized over the vesting period will only represent those options that vest.

For awards with performance conditions in which the award does not vest unless the performance condition is met, the Company recognizes expense if, and to the extent that, the Company estimates that achievement of the performance condition is probable. If the Company concludes that vesting is probable, it recognizes expense from the date it reaches this conclusion through the estimated vesting date. For awards with performance conditions that accelerate vesting of the award, the Company estimates the likelihood of satisfaction of the performance conditions, which affects the period over which the expense is recognized, and recognizes the expense using the accelerated attribution model.

Refer to Note 15, Employee Benefit Plans, for additional information regarding the measurement and recognition of expense related to the Company’s stock-based compensation awards.

Earnings (Loss) per Share

Earnings (Loss) per Share

The Company computes basic earnings (loss) per share by dividing income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding. During periods of income, the Company allocates participating securities a proportional share of income determined by dividing total weighted average participating securities by the sum of the total weighted average common shares and participating securities (the “two-class method”). The Company’s restricted stock and Series A Convertible Preferred Stock par value of $0.0001 per share (the “Series A Preferred Stock”) participate in dividends declared by the Company and are therefore considered to be participating securities. Participating securities have the effect of diluting both basic and diluted earnings per share during periods of income. During periods of loss, the Company allocates no loss to participating securities because they have no contractual obligation to share in the losses of the Company. The Company computes diluted earnings (loss) per share after giving consideration to the dilutive effect of stock options and warrants that are outstanding during the period, except where such non-participating securities would be anti-dilutive. Refer to Note 16, Loss per Share, for the Company’s calculation of loss per share for the periods presented.

Segment Information

Segment Information

The Company currently operates as one reportable business segment: the discovery, development, and commercialization of novel epigenetic therapies for patients with cancer.

Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that we adopt as of the specified effective date. Unless otherwise discussed below, we do not believe that the adoption of recently issued standards have or may have a material impact on our consolidated financial statements or disclosures.

Revenue Recognition – Collaboration Revenue

In November 2018, the FASB, issued ASU 2018-18, Collaborative Arrangements, or ASC 808, which clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue when the collaborative arrangement participant is a customer in the context of a unit of account and precludes recognizing as revenue consideration received from a collaborative arrangement participant if the participant is not a customer. The new standard was effective in the first quarter of fiscal 2021. The Company adopted ASC 808 effective in the first quarter of fiscal 2021 and the Company’s adoption of this standard did not have a material effect on the Company’s financial statements.

Income Taxes

In December 2019, the Financial Accounting Standards Board, or the FASB, issued ASU 2019-12, Income Taxes, or ASC 740, which simplifies the accounting for income taxes. The new standard was effective in the first quarter of fiscal 2021. The Company adopted ASC 740 effective in the first quarter of fiscal 2021 and the Company’s adoption of this standard did not have a material effect on the Company’s financial statements. 

Inventory

Inventory

The Company outsources the manufacturing of TAZVERIK and uses contract manufacturers to produce the raw and intermediate materials used in the production of TAZVERIK as well as the finished product. The Company currently has one supplier qualified for each step in the manufacturing process and is in the process of qualifying additional suppliers.

Inventory is composed of raw materials, intermediate materials, which are classified as work-in-process, and finished goods, which are goods that are available for sale. The Company states inventory at the lower of cost or net realizable value with the cost based on the first-in, first-out method. Inventory is classified as long-term when it is expected to be utilized beyond the Company’s normal operating cycle and is included in restricted cash and other assets on the Company's condensed consolidated balance sheets. If the Company identifies excess, obsolete or unsalable items, it writes down its inventory to its net realizable value in the period in which the impairment is identified. These adjustments are recorded based upon various factors related to the product, including the level of product manufactured by the Company, the level of product in the distribution channel, current and projected demand, the expected shelf-life of the product and firm inventory purchase commitments. Shipping and handling

costs incurred for inventory purchases are included in inventory costs and costs incurred for product shipments are recorded as incurred in cost of revenue.

Prior to receiving its first approval from the U.S. Food and Drug Administration, or FDA, on January 23, 2020 to sell TAZVERIK, the Company expensed all costs incurred related to the manufacture of TAZVERIK as research and development expense because of the inherent risks associated with the development of a product candidate, the uncertainty about the regulatory approval process and the lack of history for the Company of regulatory approval of drug candidates.

Intangible Assets, Net

Intangible Assets, Net

Intangible assets consist of capitalized milestone payments made to third parties under an in-license of patent rights upon receiving regulatory approval of TAZVERIK. The finite lived intangible assets are being amortized on a straight-line basis over the expected time period the Company will benefit from the in-licensed rights, which is generally the patent life. Intangible assets are recorded at cost at the time of their acquisition and are stated in the Company’s consolidated balance sheets net of accumulated amortization and impairments, if applicable. The amortization expense is recognized as cost of revenue in the Company’s consolidated statement of operations. During 2020 the Company paid a total of $50.0 million in milestone payments under its agreement with Eisai, Co., Ltd., or Eisai, upon regulatory approval of tazemetostat for ES and FL. These regulatory milestones have been capitalized as intangible assets.

The following table presents intangible assets as of December 31, 2021 (in thousands):

	December 31, 2021			December 31, 2020			Estimated useful life (years)
In-licensed rights	$	50,000		$	50,000			12.2
Less: accumulated amortization		(7,151	)		(2,998	)
Total intangible asset, net	$	42,849		$	47,002

The Company recorded approximately $4.2 million and $3.0 million in amortization expense related to intangible assets, using the straight-line methodology, during the years ended December 31, 2021 and 2020, respectively. Estimated future amortization expense for intangible assets is approximately $4.2 million per year thereafter.

The Company assesses its intangible assets for impairment if indicators are present or changes in circumstance suggest that impairment may exist. Events that could result in an impairment, or trigger an interim impairment assessment, include the receipt of additional clinical or nonclinical data regarding one of the Company’s drug candidates or a potentially competitive drug candidate, changes in the clinical development program for a drug candidate, or new information regarding potential sales for the drug. If impairment indicators are present or changes in circumstance suggest that impairment may exist, the Company performs a recoverability test by comparing the sum of the estimated undiscounted cash flows of each intangible asset to its carrying value on the consolidated balance sheet. If the undiscounted cash flows used in the recoverability test are less than the carrying value, the Company would determine the fair value of the intangible asset and recognize an impairment loss if the carrying value of the intangible asset exceeds its fair value.

During the three months ended June 30, 2021, the Company concluded the lower than anticipated current and projected future revenue, due to the impact of the COVID-19 pandemic as well as other factors, was an indicator that impairment may exist related to its finite-lived intangible assets. As a result, the Company performed a recoverability test and determined that the finite-lived intangible assets were recoverable. The Company’s quantitative assessment considered significant assumptions related to estimates of future TAZVERIK sales, offset by direct costs to derive the sales. The estimates of future TAZVERIK sales and associated costs include estimates of significant growth, however, these estimates are uncertain as the product was first launched in the first half of 2020 and due to the uncertainties associated with the ongoing COVID-19 pandemic. Given the limited history of sales and the inherent difficulty in making a long-range forecast, such estimates contain significant uncertainty. If the assumptions regarding forecasted revenue or the costs to derive such revenues prove to be inaccurate, the

Company may be required to perform future impairment analyses and record an impairment charge for its intangible assets in future periods.

Leases

Leases

At inception of a contract, we determine whether an arrangement is or contains a lease. For all leases, we determine the classification as either operating or financing. As of December 31, 2021, the Company does not have any leases that are classified as finance leases.

ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments under the lease. Lease recognition occurs at the commencement date, and lease liability amounts are based on the present value of lease payments made during the lease term. Renewals are not assumed in the determination of the lease term unless they are deemed to be reasonably assured at the inception of the lease. Because our leases do not provide information to determine an implicit interest rate, we use our incremental borrowing rate in determining the present value of lease payments. ROU assets also include any lease payments made prior to the commencement date less lease incentives received. Operating lease expense is recognized on a straight-line basis over the lease term.

The Company has elected not to apply the recognition requirements to short-term leases with a term of 12 months or less. Instead, the Company recognizes the lease payments in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term.

Product [Member]

Revenue Recognition

Revenue Recognition – Product Revenue

The Company recognizes revenue when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition, the Company performs the following five steps: (i) identify the contract(s) with a

customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. For a further discussion of accounting for net product revenue see Note 3, Product Revenue, Net.

Collaboration Revenue [Member]

Revenue Recognition

Revenue Recognition – Collaboration Revenue

Under ASC 606, Revenue from Contracts with Customers, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company has entered into collaboration and license agreements, which are within the scope of ASC 606, to discover, develop, manufacture and commercialize product candidates. The terms of these agreements typically contain multiple promises or obligations, which may include: (i) licenses, or options to obtain licenses, to compounds directed to specific targets (referred to as “exclusive licenses”) and (ii) research and development activities to be performed on behalf of the collaboration partner related to the licensed targets. Payments to the Company under these agreements may include non-refundable license fees, customer option exercise fees, payments for research activities, reimbursement of certain costs, payments based upon the achievement of certain milestones and royalties on any resulting net product sales.

The Company first evaluates license and/or collaboration arrangements to determine whether the arrangement (or part of the arrangement) represents a collaborative arrangement pursuant to ASC Topic 808, Collaborative Arrangements, based on the risks and rewards and activities of the parties pursuant to the contractual arrangement. The Company accounts for collaborative arrangements (or elements within the contract that are deemed part of a collaborative arrangement), which represent a collaborative relationship and not a customer relationship, outside the scope of ASC 606. The Company’s collaborations primarily represent revenue arrangements. The Company uses judgment to determine whether milestones or other variable consideration, except for sales-based royalties, should be included in the transaction price as described further below. The transaction price is allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. In determining the stand-alone selling price of a license to the Company’s proprietary technology or a material right provided by a customer option, the Company considers market conditions as well as entity-specific factors, including those factors contemplated in negotiating the agreements as well as internally developed estimates that include assumptions related to the market opportunity, estimated development costs, probability of success and the time needed to commercialize a product candidate pursuant to the license. In validating its estimated stand-alone selling price, the Company evaluates whether changes in the key assumptions used to determine its estimated stand-alone selling price will have a significant effect on the allocation of arrangement consideration between performance obligations.

Amounts received prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Amounts recognized as revenue, but not yet received or invoiced are generally recognized as contract assets.

Exclusive Licenses – If the license to the Company’s intellectual property is determined to be distinct from the other promises or performance obligations identified in the arrangement, which generally include research and development services, the Company recognizes revenue from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. In assessing whether a license is distinct from the other promises, the Company considers relevant facts and circumstances of each arrangement, including the research and development capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the collaboration partner can benefit from the license for its intended purpose without the receipt of the remaining promises, whether the value of the license is dependent on the unsatisfied promises, whether there are other vendors that could provide the remaining promises, and whether it is separately identifiable from the remaining promises. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the research and development and licensing agreement.

Research and Development Services – The promises under the Company’s collaboration and license agreements generally include research and development services to be performed by the Company on behalf of the collaboration partner. For performance obligations that include research and development services, the Company generally recognizes revenue allocated to such performance obligations based on an appropriate measure of progress. The Company utilizes judgment to determine the appropriate method of measuring progress for purposes of recognizing revenue, which is generally an input measure such as costs incurred. The Company evaluates the measure of progress each reporting period as described under Exclusive Licenses above. Reimbursements from the partner that are the result of a collaborative relationship with the partner, instead of a customer relationship, such as co-development activities, are recorded as a reduction to research and development expense.

Customer Options – The Company’s arrangements may provide a collaborator with the right to select a target for licensing either at the inception of the arrangement or within an initial pre-defined selection period, which may, in certain cases, include the right of the collaborator to extend the selection period. Under these agreements, fees may be due to the Company (i) at the inception of the arrangement as an upfront fee or payment, (ii) upon the exercise of an option to acquire a license or (iii) upon extending the selection period as an extension fee or payment. If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. The Company evaluates the customer options for material rights, or options to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the inception of the arrangement. The Company allocates the transaction price to material rights based on the relative stand-alone selling price, which is determined based on the identified discount and the probability that the customer will exercise the option. Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised or expires.

Milestone Payments – At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. If a milestone or other variable consideration relates specifically to the Company’s efforts to satisfy a single performance obligation or to a specific outcome from satisfying the performance obligation, the Company generally allocates the milestone amount entirely to that performance obligation once it is probable that a significant revenue reversal would not occur.

Royalties – For arrangements that include sales-based royalties, including milestone payments based on a level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements.

For a complete discussion of accounting for collaboration revenues, see Note 11, Collaborations.

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Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Summary of Available-for-Sale Securities Held

The following table summarizes the available for sale securities held at December 31, 2021 (in thousands):

Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Commercial paper	$	68,427	$	7	$	(3	)	$	68,431
Corporate notes		—		—		—			—
U.S. government agency securities and U.S. Treasuries		10,025		—		(1	)		10,024
Total	$	78,452	$	7	$	(4	)	$	78,455

The following table summarizes the available for sale securities held at December 31, 2020 (in thousands):

Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Commercial paper	$	158,907	$	14	$	(8	)	$	158,913
Corporate notes		33,437		3		(7	)		33,433
U.S. government agency securities and U.S. Treasuries		13,044		1		—			13,045
Total	$	205,388	$	18	$	(15	)	$	205,391

Summary of Reconciliation of Cash, Cash Equivalents, and Restricted Cash

A reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows, is as follows:

	December 31,
	2021		2020		2019
	(In thousands)
Cash and cash equivalents	$	98,336	$	168,215	$	139,482
Restricted cash, as part of other assets		1,509		1,509	1509
Total cash, cash equivalents, and restricted cash
shown in the consolidated statements of cash flows	$	99,845	$	169,724	$	140,991

Summary of Company's Financial Assets Recognized at Fair Value

As of December 31, 2021 and December 31, 2020, the Company’s financial assets recognized at fair value consisted of the following:

	Fair Value as of December 31, 2021
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents	$	88,637	$	67,209	$	21,428	$	—
Marketable securities:
Commercial paper		68,431		—		68,431		—
Corporate notes		—		—		—		—
U.S. government agency securities and treasuries		10,024		—		10,024		—
Total	$	167,092	$	67,209	$	99,883	$	—

	Fair Value as of December 31, 2020
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents	$	163,264	$	113,505	$	49,759	$	—
Marketable securities:
Commercial paper		158,913		—		158,913		—
Corporate notes		33,433		—		33,433		—
U.S. government agency securities and treasuries		13,045		—		13,045		—
Total	$	368,655	$	113,505	$	255,150	$	—

Useful Lives for Property, Plant and Equipment

The Company calculates depreciation and amortization using the straight-line method over the following estimated useful lives:

Asset Category	Useful Lives
Laboratory equipment	3 - 6 years
Computer and office equipment, and furniture	3 - 10 years
Leasehold improvements	3 - 6 years or term of respective lease, if shorter

Summary of Intangible Assets

The following table presents intangible assets as of December 31, 2021 (in thousands):

	December 31, 2021			December 31, 2020			Estimated useful life (years)
In-licensed rights	$	50,000		$	50,000			12.2
Less: accumulated amortization		(7,151	)		(2,998	)
Total intangible asset, net	$	42,849		$	47,002

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Product Revenue Net (Tables)

12 Months Ended

Dec. 31, 2021

T A Z V E R I K [Member]

Concentration Risk [Line Items]

Summary of Product Revenue Allowance and Reserve Categories

The following table summarizes activity in each of the above product revenue allowances and reserve categories for the year ended December 31, 2021:

	Chargebacks, Discounts, and			Government and Other
	Fees			Rebates			Returns			Total
	(In thousands)
Balance, January 1, 2021	$	133		$	428		$	67		$	628
Provision		1,886			3,093			274			5,253
Payments or credits		(1,775	)		(2,935	)		(232	)		(4,942	)
Balance, December 31, 2021	$	244		$	586		$	109		$	939

The following table summarizes activity in each of the above product revenue allowances and reserve categories for the year ended December 31, 2020:

	Chargebacks, Discounts, and			Government and Other
	Fees			Rebates			Returns		Total
	(In thousands)
Balance, January 1, 2020	$	—		$	—		$	—	$	—
Provision		802			1,046			67		1,915
Payments or credits		(669	)		(618	)		—		(1,287	)
Balance, December 31, 2020	$	133		$	428		$	67	$	628

Net Product Revenue [Member]

Concentration Risk [Line Items]

Schedules of Concentration of Risk Percentage

Revenue earned from each customer as a percentage of net product revenue is as follows:

	Year Ended December 31,
	2021			2020
Customer 1		30	%		45	%
Customer 2		11	%		11	%
Customer 3		27	%		20	%
Customer 4		21	%		24	%
Customer 5		11	%		0	%

Accounts Receivable [Member]

Concentration Risk [Line Items]

Schedules of Concentration of Risk Percentage

As of December 31, 2021 and 2020, five individual customers represented as a percentage of accounts receivable as follows:

	December 31, 2021			December 31, 2020
Customer 1		15	%		21	%
Customer 2		10	%		14	%
Customer 3		22	%		29	%
Customer 4		29	%		36	%
Customer 5		24	%		0	%

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Property and Equipment, net (Tables)

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Schedule of Property and Equipment, net

Property and equipment, net consists of the following:

	December 31,
	2021			2020
	(In thousands)
Laboratory equipment	$	4,580		$	4,435
Computer and office equipment, and furniture		4,386			4,636
Leasehold improvements	453			453
Construction in progress		157			34
Property and equipment		9,576			9,558
Less: accumulated depreciation		(8,031	)		(7,406	)
Property and equipment, net	$	1,545		$	2,152

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Inventory (Tables)

12 Months Ended

Dec. 31, 2021

Inventory Disclosure [Abstract]

Summary of Inventory

All of the Company’s inventory relates to the manufacturing of TAZVERIK. The following table sets forth the Company’s inventory as of December 31, 2021 and December 31, 2020:

	December 31, 2021		December 31, 2020
	(In thousands)
Raw materials	$	3,227	$	1,068
Work in process		13,748		8,564
Finished goods		1,710		829
Total	$	18,685	$	10,461
Balance sheet classification
Inventory	$	3,216	$	10,461
Restricted cash and other assets		15,469		—
Total	$	18,685	$	10,461

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Prepaid Expenses and Other Current Assets (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Schedule of Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following:

	December 31,
	2021		2020
	(In thousands)
Prepaid clinical and manufacturing costs	$	12,756	$	12,646
Interest receivable on available for sale securities	72		369
Other prepaid expenses and other receivables		6,637		4,906
Total prepaid expenses and other current assets	$	19,465	$	17,921

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Accrued Expenses (Tables)

12 Months Ended

Dec. 31, 2021

Payables and Accruals [Abstract]

Schedule of Accrued Expenses

Accrued expenses consisted of the following:

	December 31,
	2021		2020
	(In thousands)
Employee compensation and benefits	$	11,737	$	11,921
Research and development expenses		13,744		10,664
Current portion of liability related to the sale of future royalties		273		—
Professional services and other		5,023		5,987
Accrued expenses	$	30,777	$	28,572

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Schedule of Provision for (Benefit from) Income Taxes

The provision for (benefit from) income taxes for the years ended December 31, 2021, 2020, and 2019 is as follows:

	2021		2020		2019
	(In thousands)
Current	$	22	$	22	$	(34	)
Deferred		—		92		92
Total		22		114		58
Income tax provision	$	22	$	114	$	58

Reconciliation of Federal Statutory Income Tax Rate and Effective Income Tax Rate

A reconciliation of the federal statutory income tax rate and the Company’s effective income tax rate is as follows:

	Year Ended December 31,
	2021			2020			2019
Federal statutory income tax rate		21.0	%		21.0	%		21.0	%
State income taxes		5.5			6.1			6.0
Research and development and other tax credits		2.6			2.0			1.9
Permanent items		0.1			(0.6	)		(0.7	)
Change in valuation allowance		(27.2	)		(27.9	)		(27.5	)
Other		(2.1	)		(0.6	)		(0.7	)
Effective income tax rate		0.0	%		0.0	%		0.0	%

Deferred Tax Assets (Liabilities) Included in Other Assets in Consolidated Balance Sheet

The Company’s deferred tax assets (liabilities) included in other assets in the consolidated balance sheets consist of the following:

	December 31,
	2021			2020
	(In thousands)
Deferred tax assets:
Net operating loss carryforwards	$	294,248		$	238,792
Research and development and other credit carryforwards		41,189			34,205
Accruals and allowances		3,071			2,949
Eisai license payment		10,752			11,935
Stock compensation		8,211			7,338
Other		1,072			1,220
Sale of royalty		4,210			3,857
Lease liability		5,987			5,462
Business interest		7,060			1,220
Gross deferred tax assets		375,800			306,978
Deferred tax asset valuation allowance		(370,500	)		(302,137	)
Total deferred tax assets		5,300			4,841
Deferred tax liabilities:
Depreciation and other		—			(18	)
Right of use asset		(5,300	)		(4,709	)
Total deferred tax liabilities		(5,300	)		(4,727	)
Net deferred tax asset	$	—		$	114

Summary of Unrecognized Tax Benefits

The following is a rollforward of the Company’s unrecognized tax benefits:

	December 31,
	2021		2020		2019
	(In thousands)
Unrecognized tax benefits - as of beginning of year	$	7,160	$	6,328	$	5,743
Gross increases - current period tax positions		1,206		832		585
Unrecognized tax benefits - as of end of year	$	8,366	$	7,160	$	6,328

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Leases (Tables)

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Summary of Lease Costs and Company's Operating Leases

The following table contains a summary of the lease costs recognized under ASC 842 and other information pertaining to the Company’s operating leases for the years ended December 31, 2021, 2020 and 2019:

	Twelve months ended December 31,			Twelve months ended December 31,			Twelve months ended December 31,
	2021			2020			2019
Lease cost
Operating lease cost	$	6,291		$	6,155		$	3,771
Variable lease cost		2,039			1,764			1,318
Total lease cost	$	8,330		$	7,919		$	5,089
Other information
Operating cash flows used for operating leases	$	6,436		$	4,374		$	3,648
Weighted average remaining lease term	4.2 years			5.3 years			5.3 years
Weighted average discount rate		9.74	%		9.77	%		9.60	%

Schedule of Future Minimum Lease Payments Under Non-Cancelable Operating Leases

Future minimum lease payments under the Company’s non-cancelable operating leases as of December 31, 2021, are as follows:

	2021
	(In thousands)
2022	$	6,202
2023		7,517
2024		7,322
2025		3,057
Thereafter		3,909
Total lease payments	$	28,007
Less: imputed interest		(5,356	)
Total operating lease liabilities at December 31, 2021	$	22,651

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Sale of Future Royalties (Tables)

12 Months Ended

Dec. 31, 2021

Deferred Revenue Disclosure [Abstract]

Schedule of Activity of Royalty Obligation

The following table shows the activity of the Royalty Obligation since the transaction inception through December 31, 2021:

	Year Ended December 31, 2021
	(In thousands )
Proceeds from sale of future royalties	$	12,601
Non-cash royalty revenue		(31	)
Non-cash interest expense recognized		3,357
Liability related to the sale of future royalties - ending balance		15,927
Less current portion		(273	)
Related party liability related to sale of future royalties, net of current portion	$	15,654

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Long Term Debt (Tables)

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Schedule of Minimum Aggregate Future Loan Payments

The Company has the following minimum aggregate future loan payments at December 31, 2021 (in thousands):

	Year Ended December 31, 2021
2022		—
2023		—
2024		70,000
2025		75,000
2026		75,000
Total minimum payments		220,000
Less amounts representing interest and discount		(3,539	)
Less current portion		—
Related party long-term debt, net of debt discount	$	216,461

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Stockholders' Equity (Deficit) (Tables)

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Summary of Change in Fair Value of Warrant Liability

The following table rolls forward the fair value of the HutchMed Warrant liability, the fair value of which is determined by Level 3 inputs at inception on August 7, 2021, and as of December 31, 2021:

		(In thousands)
Fair value at inception	$		13,050
Decrease in fair value			(11,120	)
Fair value at December 31, 2021	$		1,930

Summary of Key Assumptions Used to Value Warrant

The key assumptions used to value the HutchMed Warrant were as follows:

	Inception			As of December 31, 2021
Risk-free interest rate		0.6	%		1.05	%
Expected term (in years)	4.0 years			3.6 years
Expected volatility of underlying stock		70.0	%		70.0	%
Expected dividend yield		-			-
Stock price	$	6.47		$	2.50

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Employee Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Schedule of Stock-Based Compensation Expense

Stock-based compensation expense is classified in the consolidated statements of operations and comprehensive loss as follows:

	Year Ended December 31,
	2021		2020		2019
	(In thousands)
Research and development	$	8,360	$	9,093	$	6,295
General and administrative		18,427		18,516		11,721
Total	$	26,787	$	27,609	$	18,016

Weighted Average Assumptions Used in Applying Pricing Model

Weighted average assumptions used in this pricing model on the date of grant for options granted to employees are as follows:

	Year Ended December 31,
	2021			2020			2019
Risk-free interest rate		0.7	%		0.9	%		2.2	%
Expected life of options	5.89 years			5.99 years			6.0 years
Expected volatility of underlying stock		70.0	%		70.9	%		72.0	%
Expected dividend yield		0.0	%		0.0	%		0.0	%

Summary of Stock Option Activity

The following is a summary of stock option activity for the year ended December 31, 2021:

	Number of Options			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
	(In thousands)					(In years)		(In thousands)
Outstanding at December 31, 2020		10,225		$	14.77
Granted		6,422			7.81
Exercised		(104	)		8.83
Forfeited or expired		(3,597	)		13.88
Outstanding at December 31, 2021		12,946		$	11.61		7.62	$	-
Exercisable at December 31, 2021		5,463		$	14.39		5.82	$	-

Summary of Service Based Restricted Stock Units

During the year-ended December 31, 2021, 2,240,217 restricted stock units (“RSUs”) were granted to executives and employees and 105,944 RSUs were granted to non-employee directors. The awards were service-based. Assuming all service conditions are achieved, the executive and employee RSUs will vest as to 50%, 33%, and 25%, respectively, of the shares of Company common stock underlying the RSUs on an annual basis over two, three, or four year period of time from the grant dates, respectively, and the non-employee director RSUs will vest as to 100% of the shares of Company common stock underlying the RSUs in full on the earlier of the first anniversary of the grant date and the date of the succeeding annual meeting of stockholders.

	Number of Units			Weighted Average Grant Date Fair Value per Unit
	(In thousands except per share data)
Outstanding at December 31, 2020		668		$	17.56
Granted		2,346			7.74
Vested		(187	)		17.20
Forfeited		(605	)		12.15
Outstanding at December 31, 2021		2,222		$	8.70

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Loss per Share (Tables)

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Basic and Diluted Loss per Share

Basic and diluted loss per share allocable to common stockholders are computed as follows:

	Year Ended December 31,
	2021			2020			2019
	(In thousands except per share data)
Net loss	$	(251,122	)	$	(231,694	)	$	(170,295	)
Accretion of Series A Preferred Stock		—			—			(2,940	)
Net loss attributable to common stockholders	$	(251,122	)	$	(231,694	)	$	(173,235	)
Weighted average shares outstanding		102,646			100,960			89,891
Basic and diluted loss per share allocable to common stockholders	$	(2.45	)	$	(2.29	)	$	(1.93	)

Common Stock Equivalents Excluded from Calculation of Diluted Loss per Share Attributable to Common Stockholders

The following common stock equivalents were excluded from the calculation of diluted loss per share allocable to common stockholders because their inclusion would have been anti-dilutive:

	Year Ended December 31,
	2021		2020		2019
	(In thousands)
Stock options		12,946		10,225		8,087
Restricted stock units		2,222		669		757
Shares issuable under employee stock purchase plan	155		98		38
Series A Preferred Stock (if converted)		3,378		3,378		3,500
Warrants		8,153		2,500		2,500
		26,854		16,870		14,882

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The Company - Additional Information (Detail) - USD ($) $ in Thousands		3 Months Ended	12 Months Ended
	Aug. 09, 2021	Sep. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Basis Of Presentation [Line Items]
Issuance of common stock, Value			$ 15,954		$ 122,708
Proceeds from issuance of common stock, net of commissions			15,954	$ 0	122,991
Proceeds from sale of redeemable convertible preferred stock			$ 76,000
Initial public offering completion date			May 2013
Cash, cash equivalents, and marketable securities			$ 176,800
Accumulated deficit			(1,239,835)	(988,713)
Selling, general and administrative			133,955	125,178	68,303
Research and development			130,966	$ 110,933	132,639
Royalty Pharma [Member]
Basis Of Presentation [Line Items]
Aggregate fund, amount			1,568,300
Non-equity funding through collaboration agreement			268,800
Issuance of common stock, Value					$ 78,705
RPI Finance Trust [Member]
Basis Of Presentation [Line Items]
Proceeds from issuance of common stock, net of commissions			150,000
RPI Finance Trust (RPI) and BioPharma Credit Investments V (Master) LP and BioPharma Credit PLC (the Lenders) [Member]
Basis Of Presentation [Line Items]
Fund received from collaborators			368,100
BioPharma Credit Investments V Master LP And BioPharma Credit PLC [Member]
Basis Of Presentation [Line Items]
Debt financing received through loan agreement			218,100
Operating Cost Reduction Plan Member
Basis Of Presentation [Line Items]
Percentage of cross-functional reduction of current workforce	11.00%
Severance and termination-related costs	$ 2,000
Selling, general and administrative		$ 1,600
Research and development		$ 400
IPO Member
Basis Of Presentation [Line Items]
Issuance of common stock, Value			$ 855,400

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Summary of Significant Accounting Policies - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2021 USD ($) Security Segment	Dec. 31, 2020 USD ($) Security	Dec. 31, 2019 USD ($)	Aug. 11, 2021 USD ($)
Accounting Policies [Line Items]
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value	$ 28,600,000	$ 67,700,000
Investments with an other-than-temporary impairment	0	0
Realized gains (losses) recognized on sale or maturity of marketable securities	0	0
Restricted Cash	1,500,000
Security deposit	500,000
Impairment of long-lived assets	$ 0	0	$ 0
Largest amount of tax benefit	50.00%
Reportable business segment | Segment	1
Amortization Of Intangible Assets	$ 4,200,000	3,000,000.0
Estimated future amortization of intangible assets	4,200,000
Operating lease, liabilities	22,651,000
Operating lease, right-of-use assets	20,054,000	17,305,000		$ 7,000,000.0
Eisai [Member]
Accounting Policies [Line Items]
Milestone payments		$ 50,000.0
Letter of Credit [Member] | Technology Square [Member]
Accounting Policies [Line Items]
Security deposit	500,000
Letter of Credit [Member] | Hampshire Street [Member]
Accounting Policies [Line Items]
Security deposit	$ 1,000,000.0
U.S. Government Agency [Member]
Accounting Policies [Line Items]
Number of securities in unrealized loss position | Security		1
Commercial Paper [Member]
Accounting Policies [Line Items]
Number of securities in unrealized loss position | Security	4	6
Corporate Notes [Member]
Accounting Policies [Line Items]
Number of securities in unrealized loss position | Security		7
U.S. Treasury Securities [Member]
Accounting Policies [Line Items]
Number of securities in unrealized loss position | Security	6

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Summary of Significant Accounting Policies - Summary of Available-for-Sale Securities Held (Detail) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Schedule of Available-for-sale Securities [Line Items]
Available-For-Sale Securities Held, Amortized Cost	$ 78,452	$ 205,388
Available-For-Sale Securities Held, Unrealized Gains	7	18
Available-For-Sale Securities Held, Unrealized Losses	4	15
Available-For-Sale Securities Held, Fair Value	78,455	205,391
Commercial Paper [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-For-Sale Securities Held, Amortized Cost	68,427	158,907
Available-For-Sale Securities Held, Unrealized Gains	7		$ 14
Available-For-Sale Securities Held, Unrealized Losses	3	8
Available-For-Sale Securities Held, Fair Value	68,431	158,913
Corporate Notes [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-For-Sale Securities Held, Amortized Cost	0	33,437
Available-For-Sale Securities Held, Unrealized Gains	0		$ 3
Available-For-Sale Securities Held, Unrealized Losses	0	7
Available-For-Sale Securities Held, Fair Value	0	33,433
U.S. Government Agency [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-For-Sale Securities Held, Amortized Cost	10,025	13,044
Available-For-Sale Securities Held, Unrealized Gains	0	1
Available-For-Sale Securities Held, Unrealized Losses	1	0
Available-For-Sale Securities Held, Fair Value	$ 10,024	$ 13,045

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Summary of Significant Accounting Policies - Summary of Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Detail) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 98,336	$ 168,215	$ 139,482
Restricted cash, as part of other assets	1,509	1,509	1,509
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows	$ 99,845	$ 169,724	$ 140,991

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Summary of Significant Accounting Policies - Summary of Company's Financial Assets Recognized at Fair Value (Detail) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Cash equivalents	$ 88,637		$ 163,264
Total	167,092	$ 368,655
Commercial Paper [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Marketable securities	68,431		158,913
Corporate Notes [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Marketable securities	0		33,433
U.S. Government Agency [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Marketable securities	10,024		13,045
Level 1 [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Cash equivalents	67,209		113,505
Total	67,209	113,505
Level 2 [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Cash equivalents	21,428		49,759
Total	99,883	$ 255,150
Level 2 [Member] | Commercial Paper [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Marketable securities	68,431		158,913
Level 2 [Member] | Corporate Notes [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Marketable securities	0		33,433
Level 2 [Member] | U.S. Government Agency [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Marketable securities	$ 10,024		$ 13,045

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Summary of Significant Accounting Policies - Estimated Useful Lives of Assets Acquired (Detail)	12 Months Ended
	Dec. 31, 2021
Laboratory Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	3 years
Laboratory Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	6 years
Computer and Office Equipment and Furniture [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	3 years
Computer and Office Equipment and Furniture [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	10 years
Leasehold Improvements [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	3 years
Leasehold Improvements [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	6 years

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Summary of Significant Accounting Policies - Summary of Intangible Assets (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
In-licensed rights	$ 50,000	$ 50,000
Less: accumulated amortization	(7,151)	(2,998)
Total intangible asset, net	$ 42,849	$ 47,002
Estimated useful life (years)	12 years 2 months 12 days

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Product Revenue Net - Summary of Product Revenue Allowance and Reserve Categories (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Valuation And Qualifying Accounts Disclosure [Line Items]
Beginning Balance	$ 628
Provision		$ 1,915
Payments or credits		(1,287)
Ending Balance		628
TAZVERIK [Member]
Valuation And Qualifying Accounts Disclosure [Line Items]
Beginning Balance	628
Provision	5,253
Payments or credits	(4,942)
Ending Balance	939	628
TAZVERIK [Member] | Chargebacks, Discounts, and Fees [Member]
Valuation And Qualifying Accounts Disclosure [Line Items]
Beginning Balance	133
Provision	1,886	802
Payments or credits	(1,775)	(669)
Ending Balance	244	133
TAZVERIK [Member] | Government and Other Rebates [Member]
Valuation And Qualifying Accounts Disclosure [Line Items]
Beginning Balance	428
Provision	3,093	1,046
Payments or credits	(2,935)	(618)
Ending Balance	586	428
TAZVERIK [Member] | Returns [Member]
Valuation And Qualifying Accounts Disclosure [Line Items]
Beginning Balance	67
Provision	274	67
Payments or credits	(232)	0
Ending Balance	$ 109	$ 67

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Product Revenue Net - Additional Information (Detail) - Customer	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Accounts Receivable [Member] | Credit Concentration Risk [Member]
Product Information [Line Items]
Number of customers	5	5

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Product Revenue Net - Schedule Of Each Customer As a Percentage Of Net Product Revenue (Detail) - Net Product Revenue [Member] - Customer Concentration Risk [Member]	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Customer 1 [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	30.00%	45.00%
Customer 2 [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	11.00%	11.00%
Customer 3 [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	27.00%	20.00%
Customer 4 [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	21.00%	24.00%
Customer Five Member
Concentration Risk [Line Items]
Concentration risk, percentage	11.00%	0.00%

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Product Revenue Net - Schedule Of Each Customer As a Percentage Of Accounts Receivable (Detail) - Accounts Receivable [Member] - Credit Concentration Risk [Member]	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Customer 1 [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	15.00%	21.00%
Customer 2 [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	10.00%	14.00%
Customer 3 [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	22.00%	29.00%
Customer 4 [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	29.00%	36.00%
Customer Five Member
Concentration Risk [Line Items]
Concentration risk, percentage	24.00%	0.00%

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Property and Equipment, Net - Schedule of Property and Equipment, Net (Detail) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property and equipment	$ 9,576	$ 9,558
Less: accumulated depreciation and amortization	(8,031)	(7,406)
Property and equipment, net	1,545	2,152
Laboratory Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	4,580	4,435
Computer Office Equipment and Furniture [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	4,386	4,636
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	453	453
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	$ 157	$ 34

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Property and Equipment, Net - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 1.1	$ 1.0	$ 0.8

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Inventory - Summary of Inventory (Detail) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Inventory [Line Items]
Raw materials	$ 3,227	$ 1,068
Work in process	13,748	8,564
Finished goods	1,710	829
Total	18,685	10,461
Inventory
Inventory [Line Items]
Total	3,216	10,461
Restricted Cash And Other Assets
Inventory [Line Items]
Total	$ 15,469	$ 0

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Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid clinical and manufacturing costs	$ 12,756	$ 12,646
Interest receivable on available for sale securities	72	369
Other prepaid expenses and other receivables	6,637	4,906
Total prepaid expenses and other current assets	$ 19,465	$ 17,921

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Accrued Expenses - Schedule of Accrued Expenses (Detail) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Accrued Liabilities, Current [Abstract]
Employee compensation and benefits	$ 11,737	$ 11,921
Research and development expenses	13,744	10,664
Current portion of liability related to the sale of future royalties	273	0
Professional services and other	5,023	5,987
Accrued expenses	$ 30,777	$ 28,572

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Income Taxes - Schedule of Provision for (Benefit from) Income Taxes (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Current	$ 22	$ 22	$ (34)
Deferred	0	92	92
Total	22	114	58
Income tax provision	$ 22	$ 114	$ 58

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Income Taxes - Reconciliation of Federal Statutory Income Tax Rate and Effective Income Tax Rate (Detail)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Federal statutory income tax rate	21.00%	21.00%	21.00%
State income taxes	5.50%	6.10%	6.00%
Research and development and other tax credits	2.60%	2.00%	1.90%
Permanent items	0.10%	(0.60%)	(0.70%)
Change in valuation allowance	(27.20%)	(27.90%)	(27.50%)
Other	(2.10%)	(0.60%)	(0.70%)
Effective income tax rate	0.00%	0.00%	0.00%

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Income Taxes - Deferred Tax Assets (Liabilities) Included in Other Assets in Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Deferred tax assets:
Net operating loss carryforwards	$ 294,248	$ 238,792
Research and development and other credit carryforwards	41,189	34,205
Accruals and allowances	3,071	2,949
Eisai license payment	10,752	11,935
Stock compensation	8,211	7,338
Other	1,072	1,220
Sale of royalty	4,210	3,857
Lease liability	5,987	5,462
Business interest	7,060	1,220
Gross deferred tax assets	375,800	306,978
Deferred tax asset valuation allowance	(370,500)	(302,137)
Total deferred tax assets	5,300	4,841
Deferred tax liabilities:
Depreciation and other	0	(18)
Right of use asset	(5,300)	(4,709)
Total deferred tax liabilities	(5,300)	(4,727)
Net deferred tax asset	$ 0	$ 114

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Income Taxes (Operating Loss Carryforwards) - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
United States, Federal [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	$ 1.1
Operating loss carryforwards, expire at various dates from 2029 through 2037	428.5
Operating loss carryforwards, expiration beginning year		2029
Operating loss carryforwards, expire indefinitely	$ 664.9
Operating loss carryforwards, expiration ending year	2030
United States, State [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	$ 1.1
Operating loss carryforwards, expiration beginning year		2037

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Income Taxes (Research and Development Tax Credit) - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Tax Credit Carryforward [Line Items]
Research and development tax credit carryforward expiration beginning year	2028
Research and development tax credit carryforward expiration ending year	2040
Federal orphan drug tax credit carryforwards expiration beginning year	2033
Expiry period of federal orphan drug tax credit carryforwards	2041
Federal orphan drug tax credit carryforwards	$ 20,800,000
Accrued tax-related interest or penalties	0	$ 0
Research Tax Credit Carryforward [Member] | United States, Federal [Member]
Tax Credit Carryforward [Line Items]
Research and development credit carryforwards	15,600,000
Research Tax Credit Carryforward [Member] | United States, State [Member]
Tax Credit Carryforward [Line Items]
Research and development credit carryforwards	$ 6,100,000

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Income Taxes - Summary of Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Unrecognized tax benefits - as of beginning of year	$ 7,160	$ 6,328	$ 5,743
Gross increases - current period tax positions	1,206	832	585
Unrecognized tax benefits - as of end of year	$ 8,366	$ 7,160	$ 6,328

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Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 30, 2019	Jul. 31, 2019	Mar. 31, 2018
Other Commitments [Line Items]
Regulatory milestone payments obligation		$ 0.9
Reimbursements receivable of regulatory milestone		1.0
Roche [Member]
Other Commitments [Line Items]
Regulatory milestone payments obligation		1.0				$ 1.0
Payments pursuant to companion diagnostic agreement	$ 9.4
Development costs		3.4	$ 4.0	$ 2.0
Royalty Pharma [Member] | Roche [Member]
Other Commitments [Line Items]
Remaining development costs	1.0						$ 10.4
Reimbursements receivable of development costs	$ 0.9	$ 0.9
Signed Amendment | Roche [Member]
Other Commitments [Line Items]
Regulatory milestone payments obligation						0.5
Fourth Amendment | Roche [Member]
Other Commitments [Line Items]
Regulatory milestone payments obligation					$ 0.5	$ 0.5

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Leases - Additional Information (Detail) - USD ($)			12 Months Ended
	Aug. 11, 2021	Aug. 16, 2019	Dec. 31, 2021	Dec. 31, 2020
Lessee Lease Description [Line Items]
Monthly base rent	$ 377,000,000		$ 200,000
Increase In base rent	388,000		33,000
Annual increase of base rent			9,000
Security deposit			500,000
Tenant Allowance	430,000
Operating Lease, Right-of-Use Asset	$ 7,000,000.0		20,054,000	$ 17,305,000
Hampshire Street [Member] | Letter of Credit [Member]
Lessee Lease Description [Line Items]
Security deposit			$ 1,000,000.0
Operating lease extend description	the Company extended the term of the Technology Square Lease through November 30, 2024.
BMR-Hampshire LLC [Member] | Cambridge [Member]
Lessee Lease Description [Line Items]
Operating lease description		the Company entered into a lease, or the Hampshire Street Lease, with BMR-Hampshire LLC, or BMR. The Hampshire Street Lease is for 33,525 rentable square feet of office space in Cambridge, Massachusetts. The Hampshire Street Lease commenced as of December 1, 2019
Operating lease extend description		the Company with an option to extend the lease term for one additional five-year period
Operating lease rent expense		$ 200,000
Operating lease rent expense incremental percentage		2.50%

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Leases - Summary of Lease Costs and Company's Operating Leases (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Leases [Abstract]
Operating lease cost	$ 6,291	$ 6,155	$ 3,771
Variable lease cost	2,039	1,764	1,318
Total lease cost	8,330	7,919	5,089
Operating cash flows used for operating leases	$ 6,436	$ 4,374	$ 3,648
Weighted average remaining lease term	4 years 2 months 12 days	5 years 3 months 18 days	5 years 3 months 18 days
Weighted average discount rate	9.74%	9.77%	9.60%

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Leases - Schedule of Future Minimum Lease Payments Under Non-Cancelable Operating Leases (Detail) $ in Thousands	Dec. 31, 2021 USD ($)
Leases [Abstract]
2022	$ 6,202
2023	7,517
2024	7,322
2025	3,057
Thereafter	3,909
Total lease payments	28,007
Less: imputed interest	(5,356)
Total operating lease liabilities at December 31, 2021	$ 22,651

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Collaborations - Additional Information (Detail)			1 Months Ended		12 Months Ended
	Aug. 07, 2021 USD ($) $ / shares shares	Jan. 01, 2011 Optiontarget	Nov. 30, 2018 USD ($) Installment	Mar. 31, 2015 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Sep. 30, 2020 USD ($)	Mar. 31, 2020 USD ($)	Dec. 30, 2019 USD ($)	Jul. 31, 2019 USD ($)	Mar. 31, 2018 USD ($)
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Regulatory milestone payments obligation						$ 900,000
Reimbursements receivable of regulatory milestone						1,000,000.0
Roche [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Regulatory milestone payments obligation						1,000,000.0					$ 1,000,000.0
Notice period in days					90 days
HutchMed License Agreement [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
License agreement date	Aug. 07, 2021
Percentage cost incurred for global studies and total number of patients enrolled In the territory	20.00%
Percentage cost incurred for global studies not specific to any territory	20.00%
Nonrefundable Upfront payment received	$ 25,000,000.0
Clinical Development And Regulatory Milestone Payment Under License Agreement	$ 110,000,000.0
Clinical license agreement expiration terms	HutchMed License Agreement will expire upon the expiration of the last royalty term for the last Licensed Product in the Field in the Territory. HutchMed may terminate the HutchMed License Agreement in its entirety for any or no reason upon 12 months’ prior written notice to the Company.
Upfront Milestone					$ 13,000,000.0
HutchMed License Agreement [Member] | Common Stock [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Date prior to which warrants are exercisable	Aug. 07, 2025
Class Of Warrant Or Right Exercise Price Of Warrants Or Rights1 | $ / shares	$ 11.50
HutchMed License Agreement [Member] | Maximum [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Sales milestone payment	$ 175,000,000.0
HutchMed License Agreement [Member] | Maximum [Member] | Common Stock [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Number of securities into which the class of warrant or right may be converted | shares	5,653,000
HutchMed License Agreement [Member] | License Revenue Member
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Collaboration and other revenue					12,000,000.0
Gsk
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Number of option targets | Optiontarget		3
Eisai [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Upfront payment made				$ 40,000,000.0
Research and development reduction						5,300,000	$ 3,800,000
Obligation related to World Wide Royalty					4,600,000	1,700,000
Royalties payable					1,700,000	700,000
Other Receivables					100,000	100,000
Eisai [Member] | Tazemetostat Drug Pruducts [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Collaboration and other revenue					6,300,000
Eisai [Member] | Maximum [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Clinical development milestone payments obligation					70,000,000.0
Regulatory milestone payments obligation					70,000,000.0
Royalty Pharma [Member] | Roche [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Remaining unpaid milestone payments					1,000,000.0							$ 10,400,000
Reimbursements receivable of development costs					900,000	900,000
Boehringer Ingelheim [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Collaboration and other revenue			$ 26,000,000.0		0	$ 500,000	$ 23,800,000
Deferred revenue					$ 0
Company received upfront payment			15,000,000.0
Research funding for costs to be incurred			$ 5,000,000.0					$ 100,000	$ 400,000
Research funding costs, payment frequency			quarterly
Research funding costs, payable installments | Installment			4
Maximum extension term of research period			1 year
Signed Amendment | Roche [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Regulatory milestone payments obligation											500,000
Fourth Amendment | Roche [Member]
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
Regulatory milestone payments obligation										$ 500,000	$ 500,000

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Sale of Future Royalties - Additional Information (Details)			1 Months Ended		12 Months Ended
	Dec. 30, 2019 USD ($) shares	Nov. 04, 2019 USD ($) Tranche $ / shares shares	Feb. 29, 2020 USD ($) shares	Nov. 30, 2019 $ / shares shares	Dec. 31, 2021 USD ($) shares	Dec. 31, 2020 USD ($) shares	Dec. 31, 2019 USD ($)	Nov. 03, 2020 USD ($)
Line Of Credit Facility [Line Items]
Common stock, shares issued | shares					106,098,000	101,627,000
Proceeds from issuance of common stock, net of commissions					$ 15,954,000	$ 0	$ 122,991,000
Royalty Purchase Agreement [Member]
Line Of Credit Facility [Line Items]
Proceeds from sale of future royalties					12,601,000
Non cash royalty revenue					31,000		0
Non cash interest expense					$ 1,800,000	$ 1,400,000	$ 200,000
RPI and Affiliates [Member]
Line Of Credit Facility [Line Items]
Percentage of ownership interest related parties					8.60%	9.00%
Tazemetostat [Member] | Royalty Purchase Agreement [Member]
Line Of Credit Facility [Line Items]
Non cash royalty revenue						$ 0
RPI Purchase Agreement [Member]
Line Of Credit Facility [Line Items]
Common stock, shares issued | shares	2,500,000	6,666,667
Warrants To Exercise Common Stock | $ / shares		$ 20.00		$ 20.00
Proceed from agreement		$ 100,000,000.0
Obligation to purchase common stock		50,000,000.0
Shares option to sell exercised by underwriters | shares			2,500,000
Proceeds from issuance of common stock, net of commissions	$ 50,000,000.0		$ 50,000,000.0
Proceeds from sale of future royalties					$ 12,600,000
Effective annual interest Rate					9.01%
RPI Purchase Agreement [Member] | RPI and Affiliates [Member]
Line Of Credit Facility [Line Items]
Payments for Royalties					0.19%
RPI Purchase Agreement [Member] | Achievement of Specified Annual Net Sales [Member]
Line Of Credit Facility [Line Items]
Potential milestone payments		$ 1,500,000,000
Maximum [Member] | Royalty Purchase Agreement [Member]
Line Of Credit Facility [Line Items]
Non cash royalty revenue					$ 100,000
Maximum [Member] | RPI Purchase Agreement [Member]
Line Of Credit Facility [Line Items]
Warrants to purchase shares of common stock | shares		2,500,000		2,500,000
Obligation to purchase share price | $ / shares		$ 20.00
Loan Agreement [Member]
Line Of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity		$ 70,000,000.0
Number of tranches | Tranche		3
Loan Agreement [Member] | RPI Purchase Agreement [Member]
Line Of Credit Facility [Line Items]
Common stock, shares issued | shares					79,000,000.0
Warrants to purchase shares of common stock | shares					8,400,000
Proceed from agreement					$ 125,000,000.0
Proceeds from sale of future royalties					12,600,000
Transaction costs					2,000,000.0
First Tranche [Member] | Loan Agreement [Member]
Line Of Credit Facility [Line Items]
Aggregate principal amount						25,000,000.0
First Tranche [Member] | Loan Agreement [Member] | RPI Purchase Agreement [Member]
Line Of Credit Facility [Line Items]
Aggregate principal amount					$ 25,000,000.0
Second Tranche [Member] | Loan Agreement [Member]
Line Of Credit Facility [Line Items]
Aggregate principal amount						25,000,000.0
Third Tranche [Member] | Loan Agreement [Member]
Line Of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity						$ 20,000,000.0
Fourth Tranche [Member] | Amended And Restated Loan Agreement [Member]
Line Of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity								$ 150,000,000.0

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Sale of Future Royalties - Schedule of Activity of Royalty Obligation (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Deferred Revenue Arrangement [Line Items]
Non-cash interest expense recognized	$ 1,782,000	$ 1,383,000	$ 192,000
Liability related to the sale of future royalties - ending balance	15,654,000	$ 14,176,000
Royalty Purchase Agreement [Member]
Deferred Revenue Arrangement [Line Items]
Proceeds from sale of future royalties	12,601,000
Non cash royalty revenue	31,000		$ 0
Non-cash interest expense recognized	3,357,000
Liability related to the sale of future royalties - ending balance	15,927,000
Less current portion	273,000
Related party liability related to sale of future royalties, net of current portion	$ 15,654,000

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Long-Term Debt - Additional Information (Detail) $ in Millions		1 Months Ended		12 Months Ended
	Nov. 03, 2020 USD ($) Installment	Nov. 30, 2020 USD ($)	Nov. 30, 2019 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Nov. 04, 2019 USD ($)
Tranche Term Loan [Member]
Debt Instrument [Line Items]
Interest rate of loan	7.75%
Number of quarterly payments of term loan | Installment	8
Description of prepayment of tranche term loan					Each of the four term loans may be prepaid before maturity in whole or in part, however there is a $50.0 million minimum prepayment for any prepayment of the loans. If the Company prepays any tranche of term loans, in whole or in part, during the first 36 months from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to the greater of (x) a make-whole amount equal to the interest that would have accrued on the principal amount to be prepaid and (y) a premium equal to 0.03 multiplied by the principal amount to be prepaid. If the Company prepays a tranche of term loan, in whole or in part, between the 36th month and 48th month from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to 0.02 multiplied by the principal amount to be prepaid. If the Company prepays a tranche of term loans, in whole or in part, between the 48th month and 60th month from the date on which the Lenders funded such tranche of term loans, then the Company must pay a prepayment premium equal to 0.01 multiplied by the principal amount to be prepaid.
Tranche Term Loan [Member] | Interest Rate Floor [Member]
Debt Instrument [Line Items]
Interest rate of loan	2.00%
First Tranche [Member] | BioPharma Credit Investments V (Master) LP [Member]
Debt Instrument [Line Items]
Interest Expense Credit Facilities				$ 22.5	$ 7.2	$ 0.3
Minimum [Member] | Tranche Term Loan [Member]
Debt Instrument [Line Items]
Prepayment of loan	$ 50.0
Loan Agreement [Member]
Debt Instrument [Line Items]
Aggregate principal amount							$ 70.0
Percentage of commitment fee paid		2.00%	2.00%
Commitment fee		$ 150.0	$ 70.0
Loan Agreement [Member] | Maximum [Member]
Debt Instrument [Line Items]
Right to request for additional loan amount							$ 300.0
Amended And Restated Loan Agreement [Member]
Debt Instrument [Line Items]
Aggregate principal amount	$ 150.0
Number of quarterly payments of term loan | Installment	4
Debt intrument outstanding interest only payment	$ 70.0
Principal And Interest Due	$ 70.0
Amended And Restated Loan Agreement [Member] | Tranche Term Loan [Member]
Debt Instrument [Line Items]
Number of quarterly payments of term loan | Installment	8

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Long-Term Debt - Schedule of Minimum Aggregate Future Loan Payments (Detail) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Long-term Debt, Fiscal Year Maturity [Abstract]
2022	$ 0
2023	0
2024	70,000
2025	75,000
2026	75,000
Total minimum payments	220,000
Less amounts representing interest and discount	(3,539)
Less current portion	0
Long-term debt, net of current portion	$ 216,461	$ 215,670

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Stockholders' Equity (Deficit) - Additional Information (Detail) - USD ($)				1 Months Ended			12 Months Ended
	May 06, 2021	Dec. 30, 2019	Nov. 04, 2019	Aug. 31, 2021	Feb. 29, 2020	Nov. 30, 2019	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Aug. 07, 2021	Apr. 08, 2021
Equity [Line Items]
Number of votes for each share of common stock							Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders.
Common stock, shares authorized							150,000,000	125,000,000
Common stock, par value							$ 0.0001	$ 0.0001
Proceeds from issuance of common stock, net of commissions							$ 15,954,000	$ 0	$ 122,991,000
Issuance costs							308,000	$ 79,000	284,000
Issuance of common stock, Value							$ 15,954,000		122,708,000
Preferred stock, shares outstanding							338,000	338,000
Preferred stock, shares issued							338,000	338,000
Net proceeds from sale of shares							$ 0	$ 0	$ 37,432,000
Preferred stock, par value							$ 0.0001	$ 0.0001
Non cash gains due to adjustment of warrant liability							$ 11,100,000
HutchMed Warrants [Member]
Equity [Line Items]
Common stock price per share							$ 2.50				$ 6.47
Warrants to purchase shares of common stock				5,653,000,000
Warrants to exercise common stock				$ 11.50
Proceeds from sale of equity securities fair value				5,653,000,000
Number of Shares Purchasable Reduced Upon Condition				2,826,500
Warrant liability				$ 13,000,000.0
Series A Convertible Preferred Stock [Member]
Equity [Line Items]
Preferred stock, shares outstanding							337,800,000	337,800,000
Preferred stock, voting rights							Shares of Series A Preferred Stock will generally have no voting rights except as required by law and except that the consent of the holders of a majority of the outstanding shares of Series A Preferred Stock will be required to amend the terms of the Series A Preferred Stock or take certain other actions with respect to the Series A Preferred Stock.
Liquidation preference per share							$ 0.001
Number of common shares convertible for each share of convertible preferred stock							10
Percentage of conversion restriction upon holder of convertible preferred stock shares							9.99%
Conversion of stock notice period							61 days
Open Market Sale Agreement [Member]
Equity [Line Items]
Common stock shares issued							3,840,977,000
Issuance costs							$ 500,000
Jefferies L L C [Member] | Open Market Sale Agreement [Member]
Equity [Line Items]
Company common stock aggregate offering price	$ 200,000.0
Commission proceeds from sale	3.00%
RPI Purchase Agreement [Member]
Equity [Line Items]
Proceeds from issuance of common stock, net of commissions		$ 50,000,000.0			$ 50,000,000.0
Warrants to exercise common stock			$ 20.00			$ 20.00
RPI Purchase Agreement [Member] | Maximum [Member]
Equity [Line Items]
Warrants to purchase shares of common stock			2,500,000			2,500,000
Proceeds from sale of equity securities fair value			2,500,000			2,500,000
Preferred Stock [Member]
Equity [Line Items]
Issuance of Series A Convertible Preferred Stock, net of commissions and beneficial conversion charge, Shares					12,200
Preferred Stock [Member] | Series A Convertible Preferred Stock [Member]
Equity [Line Items]
Issuance of Series A Convertible Preferred Stock, net of commissions and beneficial conversion charge, Shares								(12,200)	350,000
Common Stock [Member]
Equity [Line Items]
Common stock, shares authorized							150,000,000	125,000,000				225,000,000,000
Common stock, par value							$ 0.0001
Issuance of common stock, Shares					2,500,000		3,840,977		11,500,000
Issuance of common stock, Value					$ 49,900,000				$ 1,000	$ 1,000
Proceeds from financing Costs after deducting					$ 100,000
Issuance of Series A Convertible Preferred Stock, net of commissions and beneficial conversion charge, Shares					122,000
Common Stock [Member] | Series A Convertible Preferred Stock [Member]
Equity [Line Items]
Issuance of Series A Convertible Preferred Stock, net of commissions and beneficial conversion charge, Shares								122,000
Additional Paid-In Capital [Member]
Equity [Line Items]
Issuance of common stock, Value							$ 15,953,000		$ 122,707,000
Additional Paid-In Capital [Member] | RPI Purchase Agreement [Member]
Equity [Line Items]
Proceeds from sale of equity securities fair value						$ 8,400,000

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Stockholders (Deficit) Equity - Schedule of Fair Value of Warrant Liability (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Equity [Abstract]
Fair value at Inception	$ 1,930	$ 13,050
Decrease in fair value	(11,120)
Fair value at December 31, 2021	$ 1,930

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Stockholders (Deficit) Equity - Summary of Key Assumptions Used to Value Warrant (Details) - HutchMed Warrants [Member] - $ / shares		12 Months Ended
	Aug. 07, 2021	Dec. 31, 2021
Equity [Line Items]
Risk-free interest rate	0.60%	1.05%
Expected term (in years)	4 years	3 years 7 months 6 days
Expected volatility of underlying stock	70.00%	70.00%
Expected dividend yield	0.00%	0.00%
Stock price	$ 6.47	$ 2.50

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Employee Benefit Plans - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average exercise price of options granted	$ 7.81
Vesting terms	Assuming all service conditions are achieved, the executive and employee RSUs will vest as to 50%, 33%, and 25%, respectively, of the shares of Company common stock underlying the RSUs on an annual basis over two, three, or four year period of time from the grant dates, respectively, and the non-employee director RSUs will vest as to 100% of the shares of Company common stock underlying the RSUs in full on the earlier of the first anniversary of the grant date and the date of the succeeding annual meeting of stockholders.
Share-based compensation expense	$ 26,787,000	$ 27,609,000	$ 18,016,000
Aggregate stock options granted to employees, including a non-employee	6,421,792	3,522,258	4,222,693
Weighted-average fair value of options granted	$ 4.79	$ 11.69	$ 6.99
Grant date fair value of options vested	$ 27,200,000	$ 17,400,000	$ 13,200,000
Aggregate intrinsic value of stock option exercised	100,000	5,500,000	1,200,000
Unrecognized compensation cost	$ 37,300,000
Expected weighted average period for recognition of compensation cost	2 years 3 months 18 days
Percentage of employer's matching contribution				50.00%
Maximum percentage of employee contribution				3.00%
Contribution to 401 (k) plan	$ 1,400,000	$ 1,200,000	$ 600,000
Defined contribution plan name	401(k) savings plan
Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate number of stock granted to purchase	248,366
2013 Stock Incentive Plan Member
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average exercise price of options granted	$ 5.12
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend yield	0.00%	0.00%	0.00%
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate number of stock granted to purchase	106,955
Restricted Stock Units (RSUs) | 2013 Stock Incentive Plan Member
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average grant date fair value, Granted	$ 5.08
Service Based RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average grant date fair value, Granted	$ 7.74
Expected weighted average period for recognition of compensation cost	2 years 2 months 12 days
Restricted stock units outstanding	2,346,000
Compensation expense was recognized	$ 4,900,000	$ 2,700,000	$ 500,000
Unrecognized compensation cost	$ 14,300,000
Service Based RSU [Member] | Non-Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	100.00%
Service Based RSU [Member] | Share-based Payment Arrangement, Executive and Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units outstanding	2,240,217
Service Based RSU [Member] | Share-based Payment Arrangement, Nonemployee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units outstanding	105,944
Performance Based RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units outstanding			604,000
Compensation expense was recognized		3,500,000	$ 3,600,000
Unrecognized compensation cost		$ 0
Vesting Period One [Member] | Service Based RSU [Member] | Executive and Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	2 years
Vesting percentage	50.00%
Vesting Period Two [Member] | Service Based RSU [Member] | Executive and Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Vesting percentage	33.00%
Vesting Period Three [Member] | Service Based RSU [Member] | Executive and Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	4 years
Vesting percentage	25.00%
Vest on June 30, 2019 [Member] | Performance Based RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			20.00%
Vest on December 31, 2019 [Member] | Performance Based RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			25.00%
Vest on March 31, 2020 [Member] | Performance Based RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			20.00%
Vest on September 30, 2020 [Member] | Performance Based RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			30.00%

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Employee Benefit Plans - Schedule of Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based compensation expense	$ 26,787	$ 27,609	$ 18,016
Research and Development [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based compensation expense	8,360	9,093	6,295
General and Administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based compensation expense	$ 18,427	$ 18,516	$ 11,721

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Employee Benefit Plans - Weighted Average Assumptions Used in Applying Pricing Model (Detail) - Employee Stock Option [Member]	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-free interest rate	0.70%	0.90%	2.20%
Expected life of options	5 years 10 months 20 days	5 years 11 months 26 days	6 years
Expected volatility of underlying stock	70.00%	70.90%	72.00%
Expected dividend yield	0.00%	0.00%	0.00%

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Employee Benefit Plans - Summary of Stock Option Activity (Detail) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Number of Options, Outstanding, Beginning balance	10,225,000
Number of Options, Granted	6,421,792	3,522,258	4,222,693
Number of Options, Exercised	(104,000)
Number of Options, Forfeited or expired	(3,597,000)
Number of Options, Outstanding, Ending balance	12,946,000	10,225,000
Number of Options, Exercisable	5,463,000
Weighted Average Exercise Price per Share, Outstanding, Beginning balance	$ 14.77
Weighted Average Grant Date Fair Value	7.81
Weighted Average Exercise Price per Share, Exercised	8.83
Weighted Average Exercise Price per Share, Forfeited or expired	13.88
Weighted Average Exercise Price per Share, Outstanding, Ending balance	11.61	$ 14.77
Weighted Average Exercise Price per Share, Exercisable	$ 14.39
Weighted Average Remaining Contractual Term (In Years), Outstanding	7 years 7 months 13 days
Weighted Average Remaining Contractual Term (In Years), Exercisable	5 years 9 months 25 days
Aggregate Intrinsic Value, Outstanding	$ 0
Aggregate Intrinsic Value, Exercisable	$ 0

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Employee Benefit Plans - Summary of Service Based Restricted Stock Units (Detail) - Service Based RSU [Member] shares in Thousands	12 Months Ended
	Dec. 31, 2021 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of Outstanding Shares, Beginning Balance | shares	668
Number of Shares, Granted | shares	2,346
Number of Shares, Vested | shares	(187)
Number of Shares, Forfeited | shares	(605)
Number of Outstanding Shares, Ending Balance | shares	2,222
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 17.56
Weighted average grant date fair value, Granted | $ / shares	7.74
Weighted Average Grant Date Fair Value, Vested | $ / shares	17.20
Weighted Average Grant Date Fair Value, Forfeited | $ / shares	12.15
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 8.70

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Loss per Share - Additional Information (Detail) - USD ($) $ in Thousands		1 Months Ended	12 Months Ended
	Dec. 30, 2019	Feb. 29, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Nov. 04, 2019
Accretion of series A convertible preferred stock			$ 0	$ 0	$ 2,940
Common stock, shares issued			106,098,000	101,627,000
Proceeds from issuance of common stock, net of commissions			$ 15,954	$ 0	$ 122,991
RPI Purchase Agreement [Member]
Common stock, shares issued	2,500,000					6,666,667
Proceeds from issuance of common stock, net of commissions	$ 50,000	$ 50,000
RPI Purchase Agreement [Member] | Maximum [Member]
Additional shares excluded from the additional option to sell			6,250,000

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Loss per Share - Schedule of Basic and Diluted Loss per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Earnings Per Share [Abstract]
Net loss	$ (251,122)	$ (231,694)	$ (170,295)
Accretion of convertible preferred stock	0	0	(2,940)
Net loss attributable to common stockholders	$ (251,122)	$ (231,694)	$ (173,235)
Weighted average shares outstanding	102,646	100,960	89,891
Basic and diluted loss per share allocable to common stockholders	$ (2.45)	$ (2.29)	$ (1.93)

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Loss per Share - Common Stock Equivalents from Calculation of Diluted Loss per Share Attributable to Common Stockholders (Detail) - shares shares in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from the calculation of diluted loss per share	26,854	16,870	14,882
Employee Stock Option [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from the calculation of diluted loss per share	12,946	10,225	8,087
Restricted Stock Units [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from the calculation of diluted loss per share	2,222	669	757
Shares Issuable Under Employee Stock Purchase Plan [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from the calculation of diluted loss per share	155	98	38
Series A Preferred Stock [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from the calculation of diluted loss per share	3,378	3,378	3,500
Warrants [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from the calculation of diluted loss per share	8,153	2,500	2,500

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Subsequent Events - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions			1 Months Ended
	Mar. 01, 2022	Aug. 09, 2021	Jan. 31, 2022
Operating Cost Reduction Plan Member
Subsequent Event [Line Items]
Percentage of cross-functional reduction of current workforce		11.00%
Severance and termination-related costs		$ 2.0
Subsequent Event | IPO Member
Subsequent Event [Line Items]
Sale of stock, consideration received on transaction			$ 79.5
Common stock shares issued			56,666,667
Sale of common stock, price per share			$ 1.50
Subsequent Event | Operating Cost Reduction Plan Member
Subsequent Event [Line Items]
Percentage of cross-functional reduction of current workforce	12.00%
Subsequent Event | Operating Cost Reduction Plan Member | Minimum [Member]
Subsequent Event [Line Items]
Severance and termination-related costs	$ 2.8
Subsequent Event | Operating Cost Reduction Plan Member | Maximum [Member]
Subsequent Event [Line Items]
Severance and termination-related costs	$ 3.2