Praxis Precision Medicines, Inc.

believe that our current facility is sufficient to meet our current and near-term needs and that, should it be needed, suitable additional space will be available.

• Interim, topline and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available, and are subject to audit and verification procedures that could result in material changes in the final data.
• The markets for our product candidates may be smaller than we expect.
• We may not be successful in our efforts to identify or discover additional product candidates in the future.
• We conduct clinical trials for our product candidates in the United States, Europe and other jurisdictions, and the FDA, the European Medicines Agency, or EMA, and applicable foreign regulatory authorities may not accept data from trials conducted outside those respective jurisdictions.
• A Breakthrough Therapy designation from the FDA, even if granted for any of our product candidates, may not lead to a faster development or regulatory review or approval process, and does not increase the likelihood that our product candidates will receive FDA approval.
• We obtained orphan drug designation for relutrigine and elsunersen and may plan to seek orphan drug designation for additional product candidates, but we may be unable to obtain or maintain such a designation or the benefits associated with orphan drug status, including marketing exclusivity, which may cause our revenue, if any, to be reduced.
• We received rare pediatric disease designation for relutrigine and elsunersen. However, a marketing application for these product candidates, if approved, may not meet the eligibility criteria for a rare pediatric disease priority review voucher.
• We received PRIME designation by the EMA for elsunersen and we may seek PRIME or other designations, schemes or tools in the EU for one or more of our product candidates, which we may not receive. Such designations may not lead to a faster development or regulatory review or approval process and do not increase the likelihood that our product candidates will receive marketing authorization.
• Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our product candidates in other jurisdictions.
• Our product candidates may be regulated as controlled substances, the making, use, sale, importation, exportation, and distribution of which are subject to significant regulation by the U.S. Drug Enforcement Administration, or DEA, and other regulatory agencies.
• We could be subject to product liability lawsuits based on the use of our product candidates in clinical testing or, if obtained, following our products’ marketing approval and commercialization. Product liability lawsuits brought against us or any of our future collaborators could divert our resources and attention, require us to cease clinical testing, cause us to incur substantial liabilities or limit commercialization of our product candidates.
• We face significant competition in an environment of rapid technological and scientific change, and there is a possibility that our competitors may achieve regulatory approval before us or develop therapies that are safer, more advanced or more effective than ours, which may negatively impact our ability to successfully market or commercialize any product candidates we may develop and ultimately harm our financial condition.
• Risks Related to the Commercialization of our Product Candidates
• Any product candidate for which we obtain marketing approval will be subject to extensive post-marketing regulatory requirements and could be subject to post-marketing restrictions or withdrawal from the market, and we may be subject to penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems with our products, when and if any of them are approved.
• The FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses. If we are found or alleged to have improperly promoted off-label uses, we may become subject to significant liability.
• Our commercial success depends upon attaining significant market acceptance of our drug product candidates, if approved, among physicians, patients, third-party payors and other members of the medical community.
• The successful commercialization of our product candidates in the United States will depend in part on the extent to which third-party payors, including governmental authorities and private health insurers, provide coverage and adequate reimbursement levels, as well as implement pricing policies favorable for our product candidates. Failure to obtain or maintain coverage and adequate reimbursement for our product candidates, if approved, could limit our ability to market those products and decrease our ability to generate revenue.
• Governments outside the United States tend to impose strict price controls, which may adversely affect our revenues, if any.
• Even if we obtain approval of any of our product candidates in the United States or Europe, we may never obtain approval or commercialize such products in other countries, which would limit our ability to realize their full market potential.
• We have no experience as a company in commercializing products, and we will have to invest significant resources to develop these capabilities. If we are unable to establish marketing and sales capabilities or enter into agreements with third parties to market and sell our product candidates, if approved, we may not be able to generate product revenue.
• Risks Related to Ongoing Regulatory and Legal Compliance
• Our relationships with healthcare providers and physicians and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings.
• We may be subject to, or may in the future become subject to, U.S. federal and state, and foreign laws and regulations imposing obligations on how we collect, use, disclose, store and process personal information. Our actual or perceived failure to comply with such obligations could result in liability or reputational harm and could harm our business. Ensuring compliance with such laws could also impair our efforts to maintain and expand our customer base, and thereby decrease our revenue.
• Ongoing healthcare legislative and regulatory reform measures may have a material adverse effect on our business and results of operations.
• In the United States, inadequate funding for the FDA, the SEC, and other government agencies could hinder their ability to hire and retain key leadership and other personnel, prevent new products and services from being developed or commercialized in a timely manner or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business.
• EU drug marketing and reimbursement regulations may materially affect our ability to market and receive coverage for our products in the European member states.
• Additional laws and regulations governing international operations could negatively impact or restrict our operations.
• If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could harm our business.
• Risks Related to Our Intellectual Property
• Our success depends in part on our ability to protect our intellectual property. It is difficult and costly to protect our proprietary rights and technology, and we may not be able to ensure their protection.
• We have entered into, and may enter into, license or other collaboration agreements that impose certain obligations on us. If we fail to comply with our obligations under such agreements with third parties or otherwise experience disruptions to our business relationships with our current or future licensors, we could lose rights that may be important to our business.
• Our technology licensed from third parties may be subject to retained rights.
• We may rely on trade secrets and proprietary know-how, which can be difficult to trace and enforce and, if we are unable to protect the confidentiality of our trade secrets and proprietary know-how, our business and competitive position would be harmed.
• Third-party claims of intellectual property infringement may prevent or delay our product discovery and development efforts.
• Our collaborators may assert ownership or commercial rights to inventions they develop from research we support or that we develop or otherwise arising from the collaboration.
• We may become subject to claims challenging the inventorship or ownership of our patents and other intellectual property.
• Third parties may assert that we are employing their proprietary technology without authorization.
• Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.
• We may not be successful in obtaining or maintaining necessary rights to develop any future product candidates on acceptable terms.
• We may be involved in lawsuits to protect or enforce our patents or other intellectual property, or the patents or intellectual property of our licensors, which could be expensive, time-consuming and unsuccessful.
• Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.
• Any patents, if issued, covering our product candidates could be found invalid or unenforceable if challenged in court or the USPTO.
• Changes in patent law in the United States and in foreign jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products.
• We have limited foreign intellectual property rights and may not be able to protect our intellectual property rights throughout the world.
• Patent terms may be inadequate to protect our competitive position on our product candidates for an adequate amount of time.
• If we do not obtain patent term extension and data exclusivity for any product candidates we may develop, our business may be materially harmed.
• If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected.
• Risks Related to Our Dependence on Third Parties
• We rely on third parties to assist in conducting our preclinical studies and clinical trials. If they do not perform satisfactorily, we may not be able to obtain regulatory approval or commercialize our product candidates, or such approval or commercialization may be delayed, and our business could be substantially harmed.
• We contract with third parties for the manufacture of our product candidates. This reliance on third parties increases the risk that we will not have sufficient quantities of our product candidates or drugs or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.
• If any third-party manufacturer of our product candidates is unable to increase the scale of its production of our product candidates, and/or increase the product yield of its manufacturing, then our costs to manufacture the product may increase and commercialization may be delayed.
• We depend on third-party suppliers for key raw materials used in our manufacturing processes, some of which are our sole source of supply, and the loss of these third-party suppliers or their inability to supply us with adequate raw materials could harm our business.
• We depend on collaborations with third parties for the research, development and commercialization of certain of the product candidates we may develop. If any such collaborations are not successful, we may not be able to realize the market potential of those product candidates.
• We may acquire businesses or products, or form strategic alliances, in the future, and we may not realize the benefits of such acquisitions or alliances.
• Risks Related to Employee Matters, Managing Our Business and Operations
• We or the third parties upon whom we depend may be adversely affected by natural disasters, health epidemics or other business interruptions and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster.
• We depend heavily on our executive officers, principal consultants and others, and the loss of their services could materially harm our business.
• Our employees, independent contractors, consultants, collaborators and contract research organizations may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements, which could cause significant liability for us and harm our reputation.
• We expect to expand our organization, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.
• Cyberattacks or other failures in our telecommunications or information technology systems, or those of our collaborators, contract research organizations, third-party logistics providers, distributors or other contractors or consultants, could result in information theft, data corruption and significant disruption of our business operations.
• We rely on cloud-based software services and access these services via the Internet for the vast majority of our computing, storage, and other functions. Any disruption of or interference with our use of our cloud-based services would negatively affect our operations and could seriously harm our business.
• Legislation or other changes in tax laws could adversely affect our business and financial condition.
• Our ability to use our U.S. federal and state net operating loss carryforwards and certain other tax attributes may be limited.
• Risks Related to Our Common Stock
• The price of our stock has been and may in the future be volatile, and you could lose all or part of your investment.
• If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
• We do not intend to pay dividends on our common stock so any returns will be limited to the value of our stock.
• Future issuances of our common stock or the issuance of shares of common stock upon the exercise or conversion of securities that are exercisable or convertible into shares of common stock, such as our pre-funded warrants, or upon the exercise or vesting of incentive awards, may result in dilution for our stockholders.