Moderna (0QF) Risk Analysis

Certain features in our product candidates, including those related to mRNA, chemical modifications, surface chemistries, LNPs and their components, may result in risks that apply to some or all of our programs and modalities. As our product candidates progress, we or others may determine that certain of our risk allocation decisions were incorrect or insufficient, we made platform-level technology mistakes, individual programs or our mRNA science in general has technology or biology risks that were unknown or under-appreciated, our choices on how to develop our infrastructure to support our scale will result in an inability to manufacture our product candidates for clinical trials or otherwise impair our manufacturing or we have allocated resources in such a way that we cannot recover large investments or rapidly re-direct capital. We utilize earlier programs in a modality to understand the technology risks within the modality, including the program's manufacturing and pharmaceutical properties. Even if our earlier programs in a modality are successful in any phase of development, other programs may fail at that stage, and any program may fail at a later phase of development. This may be a result of technical challenges or biology risk unique to that program. The biology risk across much of our pipeline represents targets and pathways not clinically validated by one or more approved drugs, and the risk that the targets or pathways that we have selected may not be effective will continue to apply across our current and future programs. As we progress our programs through clinical development, new technical challenges may arise that cause an entire modality to fail. Additionally, any portfolio-spanning risks, whether known or unknown, such as an increased risk of a particular type of side effect, if realized in any one of our programs, would have a material and adverse effect on our other programs and on our overall business. There are also specific additional risks to certain of our modalities and programs. For example, prophylactic vaccines typically require clinical testing in up to tens of thousands of healthy volunteers to define an approvable benefit-risk profile. The need to show a high degree of safety and tolerability when dosing healthy individuals could result in rare and even spurious safety findings, negatively impacting a program prior to or after commercial launch. Even if we observe positive safety, tolerability and levels of immunogenicity in early clinical trials, we may not observe acceptable safety or efficacy profiles in later-stage trials required for approval of these programs. There are many clinical and manufacturing challenges specific to intismeran autogene and any other neoantigen therapies we may develop. These include a rapid production turn-around time measured in weeks in order to supply patients before further progression and mutation of their tumors, the significant costs incurred in making individualized medicines and potential lack of immune responses due to the biology of the tumor or patient's immune status. These risks apply to intismeran and other neoepitope investigational medicine programs. In addition, the translatability of target selection from preclinical animal models to successful clinical trial results is uncertain and may fail, particularly for systemic therapies and cancer antigen therapies. In general, several biological steps are required for delivery of mRNA to translate into therapeutically active medicines. These processing steps may differ between individuals or tissues, potentially leading to variable levels of therapeutic protein, activity, immunogenicity or distribution to tissues for a therapeutic effect. mRNA medicines may elicit innate or adaptive immune responses to the mRNA, delivery vehicle (such as an LNP) or the encoded protein, which could result in adverse events or reduced tolerability. In certain settings, immune responses to the encoded protein limit the effectiveness or durability of treatment, including upon repeat administration, or require changes to dosing, formulation or clinical development plans.

Enrolling participants in our clinical trials is critical to our success. Difficulties or delays in enrolling a sufficient number of participants could increase costs or impact the timing or outcome of our planned clinical trials, which could prevent trial completion and adversely affect our ability to advance the development of and obtain regulatory approval for our product candidates. Participant enrollment is affected by many factors, including: - severity of the disease under investigation;- complexity and design of the clinical trial protocol;- size of the patient population and eligibility criteria for the clinical trial in question, including age-based eligibility criteria limiting subject enrollment to adolescent or pediatric populations;- proximity and availability of clinical trial sites for prospective trial participants;- availability of competing therapies and clinical trials, and clinicians' and participants' perceptions of the relative advantages, risks and side effects of our product candidates compared to other available therapies, including any new drugs or treatments;- patient referral practices of physicians;- ability to monitor trial participants adequately during and after treatment;- ability to recruit qualified clinical trial investigators;- adverse results or other safety signals in our trials or related to other product candidates, and any resulting negative publicity, which could discourage potential participants and their physicians from participating in our trials; and - our ability to obtain and maintain participant informed consent. Additionally, we may have limited or no ability to influence enrollment in clinical trials where our collaborators control clinical development. Even if we or our collaborators successfully enroll participants, some may not be dosed or complete the trial.

Few mRNA medicines have been approved to date by the FDA or other regulators, and efficacy, safety, tolerability and immunogenicity data and real-world evidence with respect to mRNA medicines continue to accumulate. We may observe new, more frequent or more severe adverse events in clinical trial participants or among vaccinated individuals. For example, some studies have suggested that Spikevax may be associated with higher rates of myocarditis and pericarditis in young males compared to other COVID vaccines. Myocarditis and pericarditis have also been reported following vaccination with other COVID vaccines, including mNEXSPIKE. If similar observations are made in recipients of our other products or product candidates, or if other unexpected safety issues arise, we could suffer significant damage to our reputation and that of our mRNA platform. Such events could lead to other issues, including delays in our other programs, the need to re-design our clinical trials and the need for significant additional financial resources. In addition, the FDA and other regulators may interpret data from our clinical trials differently than we do and such agencies may require us to conduct additional studies or analyses, which could delay or prevent us from obtaining full regulatory approvals in certain jurisdictions or for certain demographics. Further, local legislatures may attempt to regulate or restrict the use of mRNA medicines in their jurisdictions. Successful discovery and development of mRNA medicines by us or our strategic collaborators is highly uncertain and depends on many factors beyond our or their control, and our business decisions and development efforts relating to mRNA technology, delivery systems and manufacturing processes may ultimately be unsuccessful. Promising early-phase product candidates may fail to advance, be delayed in the clinic, be subject to clinical holds or fail to reach the market for many reasons, including: - nonclinical, preclinical or clinical trial results may show potential mRNA medicines to be less effective than desired or to have harmful or problematic side effects or toxicities;- adverse results in our clinical trials, or in those of others developing similar products, or adverse effects relating to mRNA, or our LNPs, may lead to negative publicity or delays in or termination of our programs;- the efficacy or safety of a combination vaccine product candidate could be less than that seen with the administration of the vaccines separately, which could prevent the combination product from obtaining regulatory approval;- adverse events related to products that are perceived to be similar to mRNA medicines, such as those related to gene therapy or gene editing, could result in a decrease in the perceived benefit of one or more of our programs, increased regulatory scrutiny, decreased confidence by patients and clinical trial collaborators in our product candidates and less demand for any product that we may develop;- the insufficient ability of our translational models to reduce risk or predict outcomes in humans, particularly given that each component of our product candidates may have a dependent or independent effect on safety, tolerability and efficacy, which may be species-dependent;- manufacturing failures or insufficient supply of current Good Manufacturing Practice (cGMP) materials for clinical trials, or higher than expected cost could delay or set back clinical trials, or make mRNA medicines commercially unattractive;- changes that we make to optimize our manufacturing, testing or formulating of cGMP materials could impact the safety, tolerability and efficacy profile of our product candidates;- pricing or reimbursement issues or other factors that delay clinical trials or make any mRNA medicine uneconomical or noncompetitive with other therapies;- our large pipeline of product candidates could result in a greater quantity of reportable adverse events, including suspected unexpected serious adverse reactions, other reportable negative clinical outcomes, manufacturing reportable events or material clinical events that could lead to clinical delay or hold by the FDA or applicable regulatory authority or other clinical delays, any of which could negatively impact the perception of one or more of our programs, as well as our business as a whole;- failure to timely advance our programs or a failure or delay in receiving necessary regulatory approvals due to, among other factors, slow or failure to complete enrollment in clinical trials, withdrawal by trial participants from trials, failure to achieve trial endpoints, additional time requirements for data analysis, data integrity issues, preparation of a BLA or the equivalent application, discussions with the FDA or EMA, a regulatory request for additional nonclinical or clinical data or safety formulation or manufacturing issues may lead to our inability to obtain sufficient funding;- new legislation or regulations passed by U.S., state or foreign governments in response to negative public perception of mRNA medicines; and - the proprietary rights of others and their competing products and technologies that may prevent our mRNA medicines from being commercialized.

There are no pharmacologic therapies approved to treat the underlying causes of many diseases that we are currently attempting to address or may address in the future. For many rare diseases, few clinical trials have been attempted. As a result, the design and conduct of clinical trials of product candidates for the treatment of these disorders may take longer, be more costly or be less effective. Even if the FDA finds our success criteria to be sufficiently validated and clinically meaningful, we may not achieve the pre-specified endpoint to a degree of statistical significance in our pivotal or other clinical trials, or our results may be inconsistent or unpredictable compared to traditional efficacy endpoints. Further, the FDA may give overriding weight to other efficacy endpoints over a primary endpoint, even if we achieve statistically significant results on that endpoint, if we do not do so on our secondary efficacy endpoints. The FDA also weighs the benefits of a product against its risks and may view the efficacy results in the context of safety as not being supportive of licensure. Regulators in other countries may make similar findings with respect to these endpoints.

Much of our pipeline is in preclinical development, and these programs could be delayed or not advanced into the clinic. Before initiating clinical trials for a product candidate, we must complete extensive preclinical studies, including IND-enabling good laboratory practice (GLP) toxicology testing, as well as significant Chemistry, Manufacturing, and Controls (CMC) activities for inclusion in an IND submission. CMC activities for mRNA medicines involve complex manufacturing processes and analytical development, which are uncertain and lengthy. We have had and may in the future have difficulty identifying appropriate buffers and storage conditions to enable sufficient shelf life of batches of our product candidates. If we must produce new batches, our preclinical studies could be delayed. We cannot be certain of the timely completion of our preclinical testing and studies, whether the FDA or other regulators will accept the results or if the outcome of our preclinical testing, studies and CMC activities will ultimately support further development of our programs. As a result, we may be unable to submit INDs or similar applications for our preclinical programs on the timelines we expect, if at all, and such applications may not result in the FDA or other regulators allowing clinical trials to begin.

We pursue and fund the development of selected research programs or product candidates and may choose to forego or delay pursuit of other opportunities that could later prove to have greater commercial potential. For example, we are currently focusing our efforts on certain prioritized programs that we expect to file for approval over the next several years. Our resource allocation decisions, or our contractual commitments to provide resources to our strategic collaborators, may cause us to fail to capitalize on other commercial products or market opportunities. Additionally, spending on research and development programs may not yield commercially viable products. We may also seek to enter into strategic collaborations or financing arrangements pursuant to which we may relinquish valuable rights to product candidates, including the rights to a portion of future revenues, through a strategic alliance, licensing or other royalty arrangements in cases where it would have been more advantageous for us to retain sole development and commercialization rights. Additionally, we may allocate internal resources to a product candidate in a therapeutic area in which it would have been more advantageous to enter into a strategic alliance.