Viridian Therapeutics (1S1) Risk Analysis

If a product candidate is intended for the treatment of a serious condition and nonclinical or clinical data demonstrate the potential to address unmet medical need for this condition, a product sponsor may apply for FDA Fast Track designation, or a product can receive Breakthrough Therapy designation if preliminary clinical evidence indicates that the product, alone or in combination with one or more other drugs or biologics, may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints. If we seek Fast Track or Breakthrough Therapy designation or Priority Review for a product candidate, we may not receive such designations or review from the FDA. However, even if we receive Fast Track or Breakthrough Therapy designation, it does not ensure that we will receive Priority Review or marketing approval in any particular timeframe or at all. We may not experience a faster development or regulatory review or approval process with Fast Track or Breakthrough Therapy designation or Priority Review compared to conventional FDA procedures. In addition, the FDA may withdraw Fast Track or Breakthrough Therapy designation if it believes that the designation is no longer supported by data from our clinical development program. Fast Track or Breakthrough Therapy designation alone does not guarantee qualification for the FDA's priority review procedures.

We may seek orphan drug designation for veligrotug in indications other than thyroid eye disease and/or territories outside of the U.S. or for our other product candidates in various indications and/or territories subject to meeting the local requirements for orphan designation. Even if we obtain orphan drug designation for any of our current and potential future product candidates, we may not be the first to obtain marketing approval for any particular orphan indication due to the uncertainties associated with developing pharmaceutical products. Exclusive marketing right in the U.S. also may be limited if we seek approval for an indication broader than the orphan designated indication and may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition. Further, even if we obtain orphan drug exclusivity for an existing or future product candidate, that exclusivity may not effectively protect the product from competition because different drugs with different active moieties still can be approved for the same condition even with an orphan drug designation. Additionally, even after an orphan drug is approved, the FDA can subsequently approve the same drug with the same active moiety for the same condition if the FDA concludes that the later drug is clinically superior in that it is safer, more effective, or makes a major contribution to patient care. Orphan drug designation neither shortens the development time or regulatory review time of a drug or biologic nor gives the drug or biologic any advantage in the regulatory review or approval process. In addition, the regulatory agency responsible for the granting of orphan drug exclusivity may change their interpretation of the scope of orphan drug exclusivity. For example, the FDA's longstanding interpretation of the Orphan Drug Act is that exclusivity is specific to the orphan indication for which the drug was actually approved. As a result, the scope of exclusivity has been narrow and protected only against competition from the same "use or indication" rather than the broader "disease or condition." Our ability to obtain and maintain orphan drug designation and the benefits thereof, including orphan drug exclusivity, may materially impact our financial performance.

We created the organizational infrastructure we believe we need to support the commercial success of veligrotug. Factors that may inhibit our efforts to maintain and further develop commercial capabilities include: - an inability to retain an adequate number of effective commercial personnel and hire additional commercial personnel in the future;- an inability to train sales personnel, who may have limited experience with our company or our products, to deliver a consistent message regarding our products and be effective in educating clinicians on how to prescribe our products;- an inability to equip sales personnel with compliant and effective materials, including medical and sales literature to help them educate physicians and our healthcare providers regarding our products and their proper administration and educate payors on the safety, efficacy and effectiveness profile of our products to support favorable coverage decisions;- unforeseen costs and expenses associated with maintaining and further developing an independent sales and marketing organization; and - an inability to timely develop effective commercial, sales and marketing infrastructure to support new product launches. If we are not successful in maintaining an effective commercial, sales and marketing infrastructure, we will encounter difficulty in achieving, maintaining or increasing projected sales of our products, if approved, which would adversely affect our business and financial condition. In addition, the FDA may implement regulatory, policy, or enforcement changes that materially limit our ability and that of our third-party contractors to promote our products to consumers, which could materially impact our business. In September 2025, the FDA stated that it intends to more aggressively enforce requirements for direct-to-consumer, or DTC, drug advertising and sent more than 100 warning or untitled letters to companies for allegedly deceptive prescription drug advertising, which represents a dramatic increase in such actions as compared to prior years. FDA also announced plans to expand its oversight of digital and social media advertising and to initiate a rulemaking that would call for drug companies to disclose additional safety information in DTC broadcast advertisements. The nature and extent of changes to FDA's regulations and enforcement approach is unclear but may impact pharmaceutical marketing efforts across the industry, including ours, which could in turn impact our sales and operations. In the future, we may choose to collaborate with third parties that have direct sales forces and established distribution systems, either to augment our own sales force and distribution systems or as an alternative to our own sales force and distribution systems. To the extent that we enter into co-promotion or other licensing arrangements, our product revenue may be lower than if we directly marketed or sold any approved products. In addition, any revenue we receive will depend in whole or in part upon the efforts of these third parties, which may not be successful and are generally not within our control. If we are unable to enter into these arrangements on acceptable terms or at all, we may not be able to successfully commercialize any approved products. If we are not successful in commercializing any approved products, either on our own or through collaborations with one or more third parties, our future product revenue will suffer and we may incur significant additional losses.

Because we have limited financial and human resources, we may forgo or delay the pursuit of opportunities with some programs or 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 more profitable market opportunities. Our spending on current and future research and development programs and future product candidates for specific indications may not yield any commercially viable products. We may also enter into additional strategic collaboration agreements to develop and commercialize some of our programs and potential product candidates in indications with potentially large commercial markets. If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through strategic collaborations, 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. 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 collaboration arrangement.

From time to time, we publish preliminary data from our clinical trials. In December 2023, we reported clinical data from our phase 1 clinical study in healthy volunteers and announced the selection of elegrobart as our lead subcutaneous product candidate for TED. In September 2024, we announced topline data from the phase 3 THRIVE 1 trial of veligrotug in patients with active TED, in which veligrotug achieved a 70% proptosis responder rate at week 15. In March 2026, we announced topline data from the phase 3 REVEAL-1 trial of elegrobart in patients with active TED and in May 2026, we announced topline data from the phase 3 REVEAL-2 trial of elegrobart in patients with chronic TED. In the REVEAL-1 trial, elegrobart dosed every four weeks and every eight weeks achieved clinically meaningful 54% and 63% proptosis responder rate versus 18% placebo at week 24. In the REVEAL-2 trial, elegrobart dosed every four weeks and every eight weeks achieved clinically meaningful 50% and 54% proptosis responder rate versus 15% placebo at week 24. Based on the comparable pharmacology of elegrobart to veligrotug, we believe elegrobart has the potential to maintain the clinical response of veligrotug by delivering a clinical benefit while significantly increasing patient convenience. However, we are conducting a global pivotal program for elegrobart in patients with TED, and the final results of any clinical trials conducted in TED patients with elegrobart may not demonstrate safety or efficacy comparable to veligrotug or at all. In March 2026, we announced topline data from the phase 3 REVEAL-1 trial of elegrobart in patients with active TED and in May 2026, we announced topline data from the phase 3 REVEAL-2 trial of elegrobart in patients with chronic TED. This data may not be fully reflective of the final results for these trials. If final results from these trials are not positive or favorable, it could negatively impact or alter the development of elegrobart and could materially harm our business prospects. If clinical data from any future veligrotug trials are not positive or favorable, it could negatively impact or alter the development of elegrobart and could materially harm our business prospects. Similarly, negative or unfavorable clinical data from our elegrobart product candidate could negatively impact veligrotug and could materially harm our business prospects. Topline or preliminary data from our clinical trials that we announce or publish from time to time, including the data from our phase 1 study in healthy volunteers, the data for our product candidates from our ongoing trials, and topline data, may change as more patient data become available and we become subject to audit and verification procedures that could result in material changes in the final data. The final results of clinical trials may include additional outcome measurements made throughout the duration of the clinical trial. This creates a risk that the final results could be materially different from the preliminary results reported, including those reported to date, and may include additional outcome measurements made throughout the duration of the clinical trial that are not positive or favorable. Additionally, differences in patient populations across our clinical trials may lead to inconsistent or unrepresentative data. Negative or unfavorable additional outcome measurements made throughout the duration of a clinical trial or significant adverse differences between preliminary data and final, audited and verified data could negatively affect the prospect of regulatory approval for our product candidates and could materially harm our reputation and business prospects.

Clinical testing is expensive and generally takes many years to complete, and the outcome is inherently uncertain. Failure can occur at any time during the clinical trial process. The results of nonclinical studies and earlier clinical trials, or modeling based on these studies, of our product candidates may not be predictive of the results of larger, later-stage controlled clinical trials. Product candidates that have shown promising results in early-stage clinical trials may still suffer significant setbacks in subsequent clinical trials. In addition, from time to time, we may publicly disclose interim, topline, or preliminary data from our nonclinical studies and clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change as more patient data become available. The interim, topline, or preliminary results that we report may differ from final results upon study completion, or different conclusions or considerations may qualify such results. We will have to conduct well-controlled trials in our proposed indications to support any regulatory submissions for further clinical development. A number of companies in the biopharmaceutical industry have suffered significant setbacks in advanced clinical trials due to lack of efficacy or adverse safety profiles despite promising results in earlier, smaller clinical trials. Larger scale clinical trials for our product candidates may generate additional data that raise issues regarding the safety and efficacy of our product candidates that were not observed in smaller clinical trials. Certain approaches that we take in our clinical trials with respect to measurement of safety and efficacy outcomes may differ in important respects as compared to the trials of our competitors, which may lead to negative regulatory and/or commercial outcomes. Moreover, both nonclinical and clinical data are often susceptible to varying interpretations and analyses. Third parties upon whom we rely may analyze data differently than others, or differently than we do. As a result, they or we may reach different conclusions regarding the results of our studies, including our clinical studies. We do not know whether any clinical trials we may conduct will demonstrate consistent or adequate safety and efficacy of our product candidates, with respect to the proposed indication for use, sufficient to receive regulatory approval to market our drug candidates. Failure to demonstrate safety and efficacy of our product candidates, and failure to obtain regulatory approval, would have a material adverse effect upon our business and business prospects. Additionally, differences in our clinical trial designs as compared to those of our competitors could render our product candidates less attractive than those of our competitors.

We are or may develop our product candidates in areas with existing investigational and/or approved products where such products may have known risk profiles. Undesirable side effects caused by our product candidates, or other product candidates, including in the TED space or FcRn inhibitor space, could cause us or regulatory authorities to interrupt, delay, or terminate clinical trials. Such side effects additionally may result in a delay or denial of regulatory approval by the FDA, EMA, or comparable foreign authorities, or, even in the instance that an affected product candidate is approved, may result in restrictive drug labeling. For example, hearing impairment observed in Tepezza, or other negative side effects of other IGF-1R antagonists in development, may negatively affect clinical trials for our product candidates, delay regulatory approval or result in restrictive drug labeling, if approved. Even if our product candidates receive marketing approval, and we or others later identify undesirable side effects caused by such products, potentially significant negative consequences could result, including but not limited to: - regulatory authorities may withdraw approvals of such products;- regulatory authorities may require additional warnings on the drug labeling or narrow approved indications;- we may be required to create a REMS, which could include a medication guide outlining the risks of such side effects for distribution to patients, a communication plan for healthcare providers, and/or other elements to assure safe use;- we could be sued and held liable for harm caused to patients or subjects; and - our reputation and the commercial success of our products may suffer. Clinical trials by their nature utilize a sample of the potential patient population. With a limited number of subjects and limited duration of exposure, we cannot be fully assured that rare and severe side effects of our product candidates will be uncovered and whether the real world safety and effectiveness of a product candidate will be consistent with the safety and effectiveness profile seen in clinical studies. Such rare and severe side effects may only be uncovered with a significantly larger number of patients or subjects exposed to the drug. New data relating to veligrotug, including from adverse events reports and any potential post-marketing requirements, and from other ongoing clinical studies, including those of our partners, may result in changes to the product labeling and may adversely affect sales, or result in withdrawal of veligrotug from the market. The FDA and other regulatory authorities may also consider the new data in reviewing veligrotug's marketing applications for additional indications and/or in other jurisdictions. If any of these actions were to occur, it could result in significant expense and delay and/or limit our ability to generate sales revenues. Further, if such safety problems occur or are identified after our product candidates reach the market, we could be subject to costly and time-intensive post-marketing review and regulation. The FDA or other regulatory authorities may require that we amend the labeling of the product, implement a REMS, recall the product, conduct a post-approval study or studies, implement surveillance measures, or may even withdraw approval for the product. Later discovered undesirable side effects could further result in reduced market acceptance and utilization of our product or potential product liability claims. Any of these occurrences may materially harm our business, financial condition, results of operations and prospects. Any of these events could prevent us from achieving or maintaining market acceptance of a product candidate, even if approved, and could significantly harm our business, results of operations, and prospects.