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ManufacturingPatents
We alsoownpatents claimingmethods ofmanufacturing andpurifyingoligonucleotides. These patents claimmethods for
improvingoligonucleotide drugmanufacturing, includingprocesses for large-scale oligonucleotide synthesis andpurification. These
methods allowus tomanufacture oligonucleotides at lower cost by, for example, eliminating expensivemanufacturing steps.
We also relyon trade secrets, proprietaryknow-how and continuing technological innovation todevelop andmaintain a
competitive position in antisense therapeutics.
GovernmentRegulation
Regulationbygovernment authorities in theUnitedStates andother countries is a significant component in the development,
manufacture and commercialization of pharmaceutical products and services. In addition to regulations enforcedby the FDA and
relevant foreign regulatory authorities, we are also subject to regulationunder theOccupational Safety andHealthAct, the
Environmental ProtectionAct, theToxic SubstancesControlAct, theResourceConservation andRecoveryAct andother present and
potential future federal, state and local regulations.
Extensive regulation byUnitedStates and foreigngovernmental authorities governs ourmanufacture, development and
potential sale of therapeutics. In particular, pharmaceutical products are subject tononclinical and clinical testing, aswell as other
approval requirements, by theFDA in theUnitedStates under theFederal Food, Drug andCosmeticAct andother laws andby
comparable agencies in those foreign countries inwhichwe conduct business. Various federal, state and foreign statutes alsogovern
or influence themanufacture, safety, labeling, storage, recordkeeping,marketing andqualityof our products. State, local, andother
authorities also regulate pharmaceuticalmanufacturing facilities and procedures.
In January2013, theFDA approved themarketing application forKYNAMRO for patientswithHoFH. Our facility is
subject toperiodic inspectionby theFDA to ensure that it is operating in compliancewith cGMP requirements. Approval of eachnew
drugwill require a rigorousmanufacturingpre-approval inspectionby regulatory authorities.
Our operationsmaybe directly, or indirectly throughour customers, distributors, or other business partners, subject to
various federal and state fraud and abuse laws, including, without limitation, anti-kickback statutes and false claims statutes. These
lawsmay impact, amongother things, our commercializationpartners’ proposed sales,marketing and educationprograms.
TheU.S. ForeignCorrupt PracticesAct, or FCPA, prohibits certain individuals and entities, includingus, frompromising,
paying, offering topay, or authorizing the payment of anythingof value to any foreigngovernment official, directlyor indirectly, to
obtainor retainbusiness or an improper advantage. Violations of the FCPAmay result in large civil and criminal penalties and could
result in an adverse effect on a company’s reputation, operations, and financial condition. A companymay also face collateral
consequences such as debarment and the loss of export privileges.
Competition
OurBusiness inGeneral
Formanyof their applications, our drugswill competewith existing therapies formarket share. In addition, there are a
number of companies pursuing the development of oligonucleotide-based technology and the development of pharmaceuticals
utilizing this technology. These companies include specializedpharmaceutical firms and large pharmaceutical companies acting either
independentlyor togetherwithbiopharmaceutical companies.
Our products under development address numerousmarkets. The diseases our drugs target forwhichwe have ormay receive
regulatory approvalwill determine our competition. For some of our products, an important factor in competitionmay be the timingof
market introductionof competitive products. Accordingly, the relative speedwithwhichwe candevelopproducts, complete the
clinical trials and approval processes and supply commercial quantities of the products to themarket are important competitive
factors.We expect to compete amongproducts approved for sale basedon a varietyof factors, including, amongother things, product
efficacy, safety, reliability, availability, price, reimbursement andpatent position.
