1262175--2/29/2008--TERCICA

related topics

{product, candidate, development}

{product, liability, claim}

{stock, price, operating}

{stock, price, share}

{acquisition, growth, future}

{property, intellectual, protect}

{provision, law, control}

{control, financial, internal}

{regulation, change, law}

{debt, indebtedness, cash}

{personnel, key, retain}

{financial, litigation, operation}

{competitive, industry, competition}

Risks Related to Our Business We have a limited operating history and may not be able to successfully market and sell products, generate significant revenues or attain profitability. If there are fewer children with severe Primary IGFD or Primary IGFD than we estimate, our ability to generate revenues sufficient to fund our development and commercialization efforts may be curtailed. Our products may fail to achieve market acceptance, which could harm our business. If we do not receive additional regulatory marketing approvals for Increlex in Primary IGFD, our business will be harmed. We may not realize the anticipated benefits from our collaboration with Ipsen. We may not realize the anticipated benefits from our growth hormone/IGF-1 combination product candidates or from the related agreement with Genentech. Clinical development is a long, expensive and uncertain process, and delay or failure can occur at any stage of any of our clinical trials. We do not know whether our planned clinical trials will begin on time, or at all, or will be completed on schedule, or at all. Reimbursement for our products may be slow, not available at the levels we expect, or not available at all, resulting in our expected revenues being delayed or substantially reduced. We are dependent on our collaboration with Ipsen for the development and commercialization of Increlex outside of the United States, Canada and Japan, and for a certain period of time, certain countries of the Middle East and North Africa and Taiwan. We may also be dependent upon additional collaborative arrangements in the future. These collaborative arrangements may place the development and commercialization of our product candidates outside of our control, may require us to relinquish important rights or may otherwise be on terms unfavorable to us. We face significant competition from large pharmaceutical, biotechnology and other companies that could harm our business. We rely solely on single-source third parties in the manufacture, testing, storage and distribution of Increlex . Our inability to timely transfer to an alternate single-source manufacturer to fill-finish Increlex could adversely affect our commercial supply and ability to grow revenues. Our inability to timely transfer or to complete the transfer at all to an alternate single-source manufacturer for bulk Increlex could significantly adversely affect our commercial supply and ability to grow revenues. If our contract manufacturers and/or Ipsen s facilities and operations do not maintain satisfactory cGMP compliance, we may be unable to market and sell Increlex and/or Somatuline Depot. We rely in certain cases on single-source and sole-source materials suppliers to manufacture Increlex . Difficulties or delays in product manufacturing due to advance scheduling requirements, capacity constraints and/or manufacturing lot failures at our third-party manufacturers or Ipsen could harm our operating results and financial performance and jeopardize our orphan drug marketing exclusivity. Claims and concerns may arise regarding the safety and efficacy of our products, which could require us to perform additional clinical trials, could slow penetration into the marketplace, or cause reduced sales or product withdrawal after introduction. If other companies overcome our U.S. orphan drug marketing exclusivity for Increlex or Somatuline Depot, or obtain marketing authorization in Europe for the treatment of severe Primary IGFD, they will be able to compete with us, and our revenues will be diminished. We will not be able to sell our products if we are not able to maintain our regulatory approvals due to changes to existing regulatory requirements. Competitors could develop and gain FDA approval of products containing rhIGF-1 or lanreotide, which could adversely affect our competitive position. Competitors could challenge our patents and file an Abbreviated New Drug Application, or ANDA, or a 505(b)(2) new drug application for an IGF-1 or Somatuline Depot product and adversely affect the competitive position of each. We are subject to fraud and abuse and similar laws and regulations, and a failure to comply with such regulations or prevail in any litigation related to noncompliance could harm our business. If we fail or are unable to protect or defend our intellectual property rights, competitors may develop competing products, and our business will suffer. We may incur substantial costs as a result of patent infringement litigation or other proceedings relating to patent and other intellectual property rights, and we may be unable to protect our intellectual property rights. Ipsen may seek to influence our business in a manner that is contrary to our goals or strategies or to the interests of our other stockholders. If we lose our licenses from Genentech or Ipsen, we may be unable to continue our business. We are subject to Genentech s option rights with respect to the commercialization of Increlex for all diabetes and non-orphan indications in the United States; Ipsen s right of first negotiation to develop and commercialize other endocrine products subsequently acquired or owned by us; and Genentech s option rights with respect to our growth hormone/IGF-1 combination product candidates. If third-party clinical research organizations do not perform in an acceptable and timely manner, our clinical trials could be delayed or unsuccessful. If we fail to identify and in-license other patent rights, products or product candidates, we may be unable to grow our revenues. The committed equity financing facility that we entered into with Kingsbridge Capital Limited may not be available to us if we elect to make a draw down, and may require us to pay certain liquidated damages. We may not have the ability to raise the funds necessary to finance the repayment of the convertible notes we issued to Ipsen, which could adversely affect our cash position and harm our business. If we fail to obtain the capital necessary to fund our operations, we will be unable to execute our business plan. If we are unable to manage our expected growth, we may not be able to implement our business plan. If product liability lawsuits are brought against us, we may incur substantial liabilities. Budgetary or cash constraints may force us to delay our efforts to develop certain research and development programs in favor of developing others, which may prevent us from meeting our stated timetables and completing these projects through to product commercialization. We must implement additional finance and accounting systems, procedures and controls as we grow our business and organization. If we are unable to attract and retain additional qualified personnel, our ability to market and sell our products and develop other product candidates will be harmed. Risks Related to Our Common Stock If our results do not meet our and analysts forecasts and expectations, our stock price could decline. If our officers, directors and largest stockholders choose to act together, they are able to control our management and operations, acting in their best interests and not necessarily those of other stockholders. Our collaboration with Ipsen limits our ability to enter into transactions and to pursue opportunities in conflict with Ipsen, which could cause the price of our common stock to decline. Our stockholder rights plan and anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult. The committed equity financing facility that we entered into with Kingsbridge may result in dilution to our stockholders. Our stock price may be volatile, and an investment in our stock could decline in value. We are at risk of securities class action litigation. Substantial sales of shares may impact the market price of our common stock.

Full 10-K form ▸

1262175--2/29/2008--TERCICA_INC