Efforts to ensure that our business arrangements
with third parties will comply with applicable healthcare laws and regulations will involve substantial costs. It is possible that
governmental authorities will conclude that our business practices may not comply with current or future statutes, regulations
or case law involving applicable fraud and abuse or other healthcare laws and regulations. If our operations are found to be in
violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil,
criminal and administrative penalties, damages, fines, exclusion from U.S. government funded healthcare programs, such as Medicare
and Medicaid, other foreign healthcare reimbursement and procurement programs and the curtailment or restructuring of our operations.
If any of the physicians or other providers or entities with whom we expect to do business with is found to be not in compliance
with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government
funded healthcare programs.
Risks from the improper conduct of employees,
agents, contractors, or collaborators could adversely affect our reputation and our business, prospects, operating results, and
We cannot ensure that our compliance controls,
policies, and procedures will in every instance protect us from acts committed by our employees, agents, contractors, or collaborators
that would violate the laws or regulations of the jurisdictions in which we operate, including, without limitation, healthcare,
employment, foreign corrupt practices, environmental, competition, and patient privacy and other privacy laws and regulations.
Such improper actions could subject us to civil or criminal investigations, and monetary and injunctive penalties, and could adversely
impact our operating results, ability to conduct business, and reputation.
We are exposed to the risk of employee
fraud or other misconduct. Misconduct by employees could include intentional failures to comply with FDA or EMA regulations, to
provide accurate information to the FDA or the EMA or intentional failures to report financial information or data accurately or
to disclose unauthorized activities to us. Employee misconduct could also involve the improper use of information obtained in the
course of clinical studies, which could result in regulatory sanctions and serious harm to our reputation. In June 2016, we adopted
a code of conduct, but it is not always possible to identify and deter employee misconduct, and the precautions we take to detect
and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental
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, including the imposition of significant fines or other sanctions.
Our business activities may be subject to the
Foreign Corrupt Practices Act, or FCPA, and similar anti-bribery and anti-corruption laws.
Our business activities may be subject
to the FCPA and similar anti-bribery or anti-corruption laws, regulations or rules of other countries in which we operate, including
the U.K. Bribery Act. The FCPA generally prohibits offering, promising, giving, or authorizing others to give anything of value,
either directly or indirectly, to a non-U.S. government official in order to influence official action, or otherwise obtain or
retain business. The FCPA also requires public companies to make and keep books and records that accurately and fairly reflect
the transactions of the corporation and to devise and maintain an adequate system of internal accounting controls. Our business
is heavily regulated and therefore involves significant interaction with public officials, including officials of non-U.S. governments.
Additionally, in many other countries, the health care providers who prescribe pharmaceuticals and the investigators who perform
our studies are employed by their government, and the purchasers of pharmaceuticals are government entities; therefore, our dealings
with these prescribers and purchasers are subject to regulation under the FCPA. Recently the Securities and Exchange Commission,
or SEC, and Department of Justice have increased their FCPA enforcement activities with respect to pharmaceutical companies. There
is no certainty that all of our employees, agents, contractors, or collaborators, or those of our affiliates, will comply with
all applicable laws and regulations, particularly given the high level of complexity of these laws. Violations of these laws and
regulations could result in fines, criminal sanctions against us, our officers, or our employees, the closing down of our facilities,
requirements to obtain export licenses, cessation of business activities in sanctioned countries, implementation of compliance
programs, and prohibitions on the conduct of our business. Any such violations could include prohibitions on our ability to offer
our products in one or more countries and could materially damage our reputation, our brand, our international expansion efforts,
our ability to attract and retain employees, and our business, prospects, operating results, and financial condition.