We may not be successful in obtaining or maintaining
necessary rights to our product candidates through acquisitions and in-licenses.
Our programs may in the future require
the use of proprietary rights held by third parties, the growth of our business will likely depend in part on our ability to acquire,
in-license, maintain or use these proprietary rights. In addition, our product candidates may require specific formulations to
work effectively and efficiently and the rights to these formulations may be held by others. We may be unable to acquire or in-license
any compositions, methods of use, processes, or other third-party intellectual property rights from third parties that we identify
as necessary for our product candidates. The licensing and acquisition of third-party intellectual property rights is a competitive
area, and a number of more established companies may pursue strategies to license or acquire third-party intellectual property
rights that we may consider attractive or necessary. These established companies may have a competitive advantage over us due to
their size, cash resources, and greater clinical development and commercialization capabilities. In addition, companies that perceive
us to be a competitor may be unwilling to assign or license rights to us. We also may be unable to license or acquire third-party
intellectual property rights on terms that would allow us to make an appropriate return on our investment.
For example, we sometimes collaborate with
U.S. and foreign academic institutions to accelerate our preclinical research or development under written agreements with these
institutions. Typically, these institutions provide us with an option to negotiate a license to any of the institution’s
rights in technology resulting from the collaboration. Regardless of such option, we may be unable to negotiate a license within
the specified timeframe or under terms that are acceptable to us. If we are unable to do so, the institution may offer the intellectual
property rights to other parties, potentially blocking our ability to pursue our applicable product candidate or program.
If we are unable to successfully obtain
a license to third-party intellectual property rights necessary for the development of a product candidate or program, we may have
to abandon development of that product candidate or program and our business and financial condition could suffer.
Third-party claims of intellectual property
infringement may expose us to substantial liability or prevent or delay our or our collaboration partners’ development and
Our commercial success depends on our ability
and the ability of our licensees or collaborators to develop, manufacture, market and sell our product candidates and use our proprietary
technology without infringing, misappropriating, or otherwise violating the proprietary rights and intellectual property of third
parties. The biotechnology and pharmaceutical industries are characterized by extensive and complex litigation regarding patents
and other intellectual property rights. We may in the future become party to, or be threatened with, adversarial proceedings or
litigation regarding intellectual property rights with respect to our product candidates and technology, including patent infringement
lawsuits, interferences, oppositions, reexamination proceedings, inter partes review, derivation proceedings and post grant
review before the USPTO and corresponding foreign patent offices.
Numerous U.S. and foreign issued patents
and pending patent applications, which are owned by third parties, exist in the fields in which we are developing product candidates.
For example, we are aware of third party patents that may be construed to cover one or more of our product candidates. If these
patents are asserted against us or our licensing or collaboration partners and either we or our licensing or collaboration partners
are found to infringe any of these patents, and are unsuccessful in demonstrating that such patents are invalid or unenforceable,
then we and our licensing or collaboration partners could be required to pay substantial monetary damages or cease further development
or commercialization of one or more of our product candidates. There may also be other third-party patents or patent applications
with claims to materials, formulations, methods of manufacture, or methods of treatment related to the use or manufacture of our
product candidates and technology. Although we generally conduct a freedom to operate search and review with respect to our product
candidates, we cannot guarantee that our search and review is complete and thorough, nor can we be sure that we have identified
each and every patent and pending application in the United States and abroad that is relevant or necessary to the commercialization
of our product candidates or use of our technology. Because patent applications can take many years to issue, there may be currently
pending patent applications that may later result in issued patents that our product candidates may infringe. In addition, third
parties may obtain patents in the future and claim that use of our technologies infringes upon these patents.