10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the fiscal year ended December 31, 2022

Commission File Number 001-40522

Monte Rosa Therapeutics, Inc.

(Exact name of Registrant as specified in its Charter)

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (617) 949-2643

Securities registered pursuant to Section 12(b) of the Act:

Title of each class TradingSymbol(s) Name of each exchange on which registered

Common stock, par value $0.0001 per share GLUE The Nasdaq Global Select Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ☐ No ☒

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ NO ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ NO ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐

Non-accelerated filer ☒ Smaller reporting company ☒

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐No ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, based on the closing price of the shares of common stock on NASDAQ on June 30, 2022, was $302.6 million.

The number of shares of Registrant’s Common Stock outstanding as of March 10, 2023 was 49,359,033.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of registrant's definitive proxy statement for its annual meeting of shareholders to be filed within 120 days after the close of the registrant's fiscal year are incorporated by reference to into Part III of this annual report on Form 10-K.

Table of Contents

Page

PART I

Item 1. Business 1

Item 1A. Risk Factors 56

Item 1B. Unresolved Staff Comments 110

Item 2. Properties 110

Item 3. Legal Proceedings 110

Item 4. Mine Safety Disclosures 110

PART II

Item 6. [Reserved] 112

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 121

Item 8. Financial Statements and Supplementary Data 121

Item 9A. Controls and Procedures 122

Item 9B. Other Information 122

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 122

PART III

Item 10. Directors, Executive Officers and Corporate Governance 123

Item 11. Executive Compensation 123

Item 14. Principal Accounting Fees and Services 123

PART IV

Item 15. Exhibits, Financial Statement Schedules 124

SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

This Annual Report on Form 10-K, or Annual Report, contains forward-looking statements which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, or the or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. All statements other than statements of historical facts contained in this Annual Report are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expects”, “intends”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential”, “continue” or the negative of these terms or other comparable terminology. These statements are not guarantees of future results or performance and involve substantial risks and uncertainties. Forward-looking statements in this Annual Report include, but are not limited to, statements about:

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the initiation, timing, progress, results, costs, and any expectations and/or predictions of success of our current and future research and development programs and preclinical studies, including our expectations for our molecular glue degraders, or MGDs, molecules, including our GSPT1-directed MGD MRT-2359;

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the initiation, timing, progress, results, costs, and any expectations and/or predictions of success of our current and any future clinical trials, including statements regarding the nature of or the timing for when any results of any clinical trials will become available;

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our ability to continue to develop our proprietary platform, called QuEENTM, and to expand our proteomics and translational medicine capabilities;

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the potential advantages of our platform technology and product candidates;

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the extent to which our scientific approach and platform technology may target proteins that have been considered undruggable or inadequately drugged;

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our plans to submit IND applications to the FDA for future product candidates;

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the potential benefits of strategic collaborations and our ability to enter into strategic collaborations with third parties who have the expertise to enable us to further develop our biological targets, product candidates and platform technologies;

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our ability to obtain and maintain regulatory approval of our product candidates;

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our ability to maintain and expand, including through third-party vendors, our library of MGDs

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our ability to manufacture, including through third-party manufacturers, our product candidates for preclinical use, future clinical trials and commercial use, if approved;

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our ability to commercialize our product candidates, including our ability to establish sales, marketing and distribution capabilities for our product candidates;

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the rate and degree of market acceptance of our product candidates;

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the size and growth potential of the markets for our product candidates, and our ability to serve those markets;

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our ability to establish and maintain intellectual property rights covering our current and future product candidates and technologies;

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the implementation of our business model and strategic plans for our business, product candidates, and technology;

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estimates of our future expenses, revenues, capital requirements, and our needs for additional financing;

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our ability to obtain funding for our operations necessary to complete further development and commercialization of our product candidates;

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our financial performance;

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developments in laws and regulations in the United States and foreign countries;

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the success of competing therapies that are or may become available;

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our ability to attract and retain key scientific or management personnel;

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the impact of the COVID-19 pandemic on our business and operations; and

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other risks and uncertainties, including those listed under Item 1A, “Risk Factors.”

Any forward-looking statements in this Annual Report reflect our current views with respect to future events and with respect to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. Factors that may cause actual results to differ materially from current expectations include, among other things, those described under Item 1A, “Risk Factors” and elsewhere in this Annual Report. Given these uncertainties, you should not place undue reliance on these forward-looking statements.

All of our forward-looking statements are as of the date of this Annual Report only. In each case, actual results may differ materially from such forward-looking information. We can give no assurance that such expectations or forward-looking statements will prove to be correct. An occurrence of or any material adverse change in one or more of the risk factors or risks and uncertainties referred to in this Annual Report or included in our other public disclosures or our other periodic reports or other documents or filings filed with or furnished to the Securities and Exchange Commission, or the SEC, could materially and adversely affect our business, prospects, financial condition and results of operations. Except as required by law, we do not undertake or plan to update or revise any such forward-looking statements to reflect actual results, changes in plans, assumptions, estimates or projections or other circumstances affecting such forward-looking statements occurring after the date of this Annual Report, even if such results, changes or circumstances make it clear that any forward-looking information will not be realized. Any public statements or disclosures by us following this Annual Report that modify or impact any of the forward-looking statements contained in this Annual Report will be deemed to modify or supersede such statements in this Annual Report.

We may from time to time provide estimates, projections and other information concerning our industry, the general business environment, and the markets for certain diseases, including estimates regarding the potential size of those markets and the estimated incidence and prevalence of certain medical conditions. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties, and actual events, circumstances or numbers, including actual disease prevalence rates and market size, may differ materially from the information reflected in this Annual Report. Unless otherwise expressly stated, we obtained this industry, business information, market data, prevalence information and other data from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data, and similar sources, in some cases applying our own assumptions and analysis that may, in the future, prove not to have been accurate.

TRADEMARKS

Solely for convenience, our trademarks and trade names in this report are sometimes referred to without the ® and TM symbols, but such references should not be construed as any indicator that we will not assert, to the fullest extent under applicable law, our rights thereto.

iii

SUMMARY OF RISK FACTORS ASSOCIATED WITH OUR BUSINESS

Our business is subject to numerous material and other risks and uncertainties that you should be aware of in evaluating our business. These risks are described more fully in Part II, “Item 1A—Risk Factors,” and include, but are not limited to, the following:

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We are a biotechnology company with a limited operating history and have not generated any revenue to date from drug sales, and may never become profitable.

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We have incurred significant operating losses since our inception and anticipate that we will incur continued losses for the foreseeable future.

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We are very early in our development efforts. All but one of our programs are still in the preclinical stages of drug development. If we are unable to commercialize our product candidates or experience significant delays in doing so, our business will be materially harmed.

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Our approach to the discovery and development of product candidates based on our QuEENTM platform is novel, which makes it difficult to predict the time, cost of development and likelihood of successfully developing any product candidates.

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We may not be successful in our efforts to identify or discover additional product candidates or we may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success.

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Even if we receive marketing authorization for our product candidates, we will be subject to extensive ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and we may be subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with our product candidates.

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If we are unable to obtain and maintain patent and other intellectual property protection for our technology and product candidates or if the scope of the intellectual property protection obtained is not sufficiently broad, our competitors could develop and commercialize technology and drugs similar or identical to ours, and our ability to successfully commercialize our technology and drugs may be impaired, and we may not be able to compete effectively in our market.

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Our future success depends on our ability to retain key executives and to attract, retain and motivate qualified personnel.

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Business disruptions could seriously harm our future revenue and financial condition and increase our costs and expenses.

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Our executive officers, directors, principal stockholders and their affiliates exercise significant influence over our company, which will limit our stockholders' ability to influence corporate matters and could delay or prevent a change in corporate control.

PART I

Item 1. Business

Overview

We are a clinical-stage biotechnology company developing a portfolio of novel and proprietary molecular glue degraders, or “MGDs”. MGDs are small molecule drugs that employ the body’s natural protein destruction mechanisms to selectively degrade therapeutically-relevant proteins. MGDs function by inducing the engagement of an E3 ligase, such as cereblon, with defined structural features on surfaces of target proteins. These target proteins are also referred to as neosubstrates. The E3 ligase then tags the target protein for degradation by adding a molecular mark known as ubiquitin. We have developed a proprietary and industry leading platform, called QuEENTM (an abbreviation for “Quantitative and Engineered Elimination of Neosubstrates”) to enable our unique target-centric MGD discovery and development approach and our rational design of MGD product candidates. We believe our MGDs provide significant advantages over existing therapeutic modalities, including other protein degradation approaches. To date, our QuEENTM platform has identified numerous proteins for potential targeting by our MGDs. We identify therapeutically-relevant target proteins amenable to our approach using our artificial intelligence or “AI” / machine learning or “ML” engines, as well as multiple experimental approaches. We are continuously increasing our understanding of how MGDs function and we are using this understanding to develop design principles for the engineering of new MGDs. This growing expertise manifests in our expanding MGD library as well as our discovery and development pipeline. Using our insights, knowhow, and technology platform we have generated a library of MGDs that forms the basis for our MGD programs. At present, our library comprises a diverse set of rationally designed small molecules representing more than 400 unique low molecular weight scaffolds and about 35,000 different MGD molecules, and our goal is to expand to about 40,000 compounds by the end of 2023. We also use our insights and learnings to continuously update and improve QuEENTM, consistently increasing the power of the platform.

We prioritize our product development on therapeutic target proteins backed by strong biological and genetic rationale, with the goal of discovering and developing novel medicines. We are focused on developing solutions to clinically important indications, including oncology, inflammation, immunology, and others.

Our most advanced product candidate, MRT-2359, is an orally bioavailable MGD targeting the translation termination factor protein GSPT1. MRT-2359 is currently in clinical development for potential use in MYC-driven tumors, including metastatic non-small cell lung cancer, or NSCLC, small cell lung cancer, or SCLC and high-grade neuroendocrine tumors. Our pre-clinical studies have shown that through a functional association between GSPT1 and the MYC family of transcription factors, GSPT1 serves as a key regulator of MYC-induced protein translation, and that the degradation of GSPT1 using our MGDs creates a potential vulnerability in multiple MYC-driven tumors. The U.S. Food and Drug Administration or the “FDA” cleared the company’s investigational new drug application or “IND” for MRT-2359 in September 2022, and we initiated a phase 1/2 clinical trial for the treatment of MYC-driven and high-grade neuroendocrine tumors in October 2022. In January 2023, MRT-2359 received Fast Track designation from the FDA for the treatment of patients with previously treated, NSCLC with L-MYC or N-MYC expression. Beyond GSPT1, we are advancing our pipeline of assets towards the clinic. Specifically, our VAV1, NEK7 and CDK2 programs are now in lead optimization and continue to advance towards development candidate selection. Our pipeline further includes multiple additional undisclosed discovery phase programs.

Our proprietary QuEENTM platform uniquely enables us to rationally design and develop our diverse library of MGDs and to deploy them against target proteins identified through our AI/ML approach. Many of these target proteins are considered inadequately drugged or completely undruggable by other therapeutic modalities. Our resulting MGDs are designed to reprogram the E3 ligase to bind to and induce the degradation of a therapeutically-relevant target protein. Central to our QuEENTM platform is a detailed understanding of the molecular interactions promoted by our MGDs between E3 ligases and structural features on the surface of therapeutically-relevant proteins, which we refer to as degrons.

Key components of our QuEENTM platform are:

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AI/ML engines: Our proprietary AI/ML engines enable us to a) determine structural features on protein surfaces that serve as MGD-dependent points of interaction between an E3 ligase and a therapeutically-relevant protein; b) create ternary complex models of an E3 ligase, an MGD, and a target protein or

neosubstrate in order to rapidly guide the design and optimization of novel MGDs, as well as perform in silico screening of such; and c) connect MGDs and their biological activity to disease-relevant biomarkers.

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Proprietary MGD library: A wholly-owned, proprietary, diverse, and continuously growing chemical library of currently around 35,000 MGDs that we have rationally designed based on our growing expertise in molecular glue anatomy and design. Library compounds currently represent more than 400 unique low molecular weight scaffolds with favorable binding affinities for an E3 ubiquitin ligase.

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High throughput proximity screening and chemo-proteomics capabilities: Our specialized and tailored suite of biochemical, structural biology, cellular, proteomics and in silico tools that enable and accelerate the discovery and optimization of MGD product candidates that efficiently recruit target proteins to E3 ligases.

By capturing our insights and experience with the identification of target proteins amenable to our approach as well as the discovery and development of MGDs through QuEENTM, we are constantly increasing the power of the platform.

Our lead candidate, MRT-2359, is an orally bioavailable MGD of the translation termination factor protein GSPT1. MRT-2359 was identified using QuEENTM and is currently in development as a potential treatment for cancers dependent on or characterized by the expression of high levels of MYC family genes (c-MYC, N-MYC and L-MYC). The MYC transcription factors are some of the most frequently mutated, translocated and highly expressed oncogenes in human cancers. For example, we estimate 15% of NSCLC, and over 70% of SCLC, express high levels of L- or N-MYC. MYC-driven cancer cells are highly addicted to protein translation, and we have shown in extensive pre-clinical studies that due to the key role of GSPT1 in protein synthesis, selective GSPT1 degradation by MRT-2359 in cells expressing high levels of L- or N-MYC leads to cell death. Further, we have demonstrated in these MYC-driven preclinical models that MRT-2359 potently and selectively induces GSPT1 degradation, leading to tumor regression after oral administration. Based on these preclinical results, we initiated clinical trials with MRT-2359 in October 2022. The Phase 1/2, open-label, multicenter study will primarily assess the safety, tolerability, pharmacokinetic or “PK”, pharmacodynamic or “PD” and preliminary clinical activity of MRT-2359 in patients with previously treated selected solid tumors, including NSCLC, SCLC, high-grade neuroendocrine cancer of any primary site, diffuse large B-cell lymphoma or “DLBCL” and solid tumors with L-MYC or N-MYC amplification. We expect to disclose initial clinical data including PK, PD, safety and available initial efficacy from the Phase 1 arm of the ongoing Phase 1/2 clinical trial evaluating MRT-2359 in the second half of 2023.

In addition to our GSPT1 program, our QuEENTM platform has produced multiple additional pipeline and discovery stage programs targeting therapeutically-relevant proteins otherwise considered undruggable or inadequately drugged. We have been able to identify selective MGDs for CDK2, an oncology target and key driver of cancers such as breast, ovarian, and uterine cancer. We have also identified target proteins outside of oncology, including target proteins with indications in inflammation and autoimmune diseases, as exemplified by our NEK7 and VAV1 programs. NEK7 is a key component of the NLRP3 inflammasome, a central regulator of cellular inflammatory responses to pathogens, damage and stress. Aberrant NLRP3 inflammasome activation is implicated in the pathogenesis of multiple autoimmune diseases, including Crohn’s disease, diabetes, gout, liver diseases, and neurodegenerative diseases. VAV1 is a central signaling protein in B and T cells, and its degradation may serve to de-activate immune cells involved in autoimmune diseases such as multiple sclerosis, myasthenia gravis, and rheumatoid arthritis. Our CDK2, NEK7 and VAV1 programs are currently in lead optimization. We also continue to progress our discovery stage programs, including a program targeting therapeutically-relevant proteins in hemoglobinopathies such as Sickle Cell Disease or “SCD”, and multiple other undisclosed target proteins. Our focus is on target proteins that have been considered undruggable or insufficiently drugged, that are highly credentialed preclinically or clinically, and that can potentially move into the clinic in indications with high unmet need and substantial commercial potential.

We are led by an experienced team of drug discovery and development experts with deep experience in targeted protein degradation, molecular glues, chemistry, structural biology, data science, disease biology, translational medicine, and clinical development.

Monte Rosa Therapeutics AG, a Swiss operating company, was incorporated under the laws of Switzerland in April 2018. Monte Rosa Therapeutics, Inc. was incorporated in the State of Delaware in November 2019. The Company is headquartered in Boston, Massachusetts with research operations in both Boston and Basel, Switzerland. Our principal executive office is located at 645 Summer Street, Boston, MA 02210 and our telephone number is (617) 949-2643. Information about us is available on our corporate websites at www.monterosatx.com. Information available on our website is not a part of, and is not incorporated into, this Annual Report. We trade on the Nasdaq Global Select Market under the ticker symbol “GLUE”.

Our product pipeline

We have leveraged our QuEENTM platform to generate our pipeline of product candidates with the potential to treat a diverse range of diseases through targeted protein degradation. Our current programs are focused on delivering therapies to target proteins that have been considered undruggable or inadequately drugged in well-characterized biological pathways across clinical indications in oncology, inflammation, immunology and other diseases with high unmet needs. We currently retain exclusive worldwide rights to the programs shown in the Figure 1 below.

Figure 1: Monte Rosa Proprietary Pipeline

Our strategy

Our mission is to discover and develop a portfolio of novel small molecule MGDs that selectively eliminate therapeutically-relevant proteins to benefit patients in a broad range of indications with significant unmet medical need. We believe the product candidates identified through our proprietary QuEENTM platform can provide distinct advantages over other modalities to address target proteins that have been considered undruggable or inadequately drugged.

Conventional small molecule inhibitor drugs generally work by interfering with the activity of a target protein through an interaction between the drug and a defined binding pocket on the target protein, typically an enzymatically active site of a protein. This limits the application of such drugs to proteins with a succinct binding pocket. Within this field, as binding pockets tend to be highly conserved within protein classes and families, achieving selectivity can be challenging. Even where a protein’s active site can be targeted, potentially with specificity, protein inhibition does not always provide the desired functional outcome.

MGDs on the other hand, provide for therapeutic opportunities not constrained by some of the key limitations of conventional small molecule inhibitor drugs. MGDs provide an opportunity to target a vast universe of target proteins not limited to those with a defined binding pocket, in a highly selective way, due to the diversity of surfaces that can be targeted, resulting in reversible elimination of a target protein. More specifically, because MGDs work by inducing protein-protein interactions between target proteins and an E3 ligase, they do not require a defined binding pocket on the target protein of interest. Thus, MGDs offer a unique opportunity to unlock significant target space and enable us to address target proteins that have been considered undruggable or inadequately drugged. The interaction surfaces we utilize are often not conserved within protein classes and families, allowing us to potentially achieve significant selectivity for our MGD product candidates that we believe is superior to classical small molecule inhibitor drugs. Lastly, we focus on target proteins where experimental evidence suggests that removal of the target is superior to transiently inhibiting it, in particular proteins that have a scaffolding function.

Through our ability to produce potentially highly selective MGDs with fine-tuned speed and depth of degradation, we believe we can generate MGD product candidates with a wide therapeutic window that may be beneficial in a broad range of indications, including oncology, immunology, inflammation, metabolic diseases and diseases of the central nervous system or CNS.

Our precision oncology programs are focused on the elimination of proteins that are highly validated driver oncogenes in cancer cells (“oncogene addiction”), that define a cancer lineage dependence (“lineage addiction”), or that create a vulnerability specific to tumor cells (“synthetic lethality”). By tuning the speed and depth of degradation and leveraging our proprietary pharmacogenomic tools, we optimize our oncology MGDs to selectively target biomarker-positive cells. Our platform enables us to potentially tune the activity (depth and speed of degradation) of our MGDs to the most relevant tumor lineages to achieve maximal phenotypic effects.

In immunology, we are uniquely able to target highly credentialed immune signaling proteins in pathologically relevant immune pathways. These proteins may have a scaffolding role (e.g. NEK7), or an active site that is hard to target (e.g. VAV1), or may be considered to be undruggable by conventional small molecules. We prioritize target proteins that are validated through preclinical or clinical (including human genetic) evidence. We have shown that we are able to optimize our MGD product candidates to induce deep and selective degradation of immune-pathway relevant proteins.

Key elements of our strategy include:

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Continue to advance our GSPT1-directed MGD program through clinical development and towards seeking regulatory approval. We have generated data in preclinical models that demonstrate the potential of our GSPT1-directed MGDs to confer antitumor activity across multiple tumor types that are characterized by the expression of high levels of theMYC family of transcription factors. We received FDA clearance of our IND for MRT-2359 in September 2022 and initiated patient dosing in our ongoing Phase 1/2 clinical trial in October 2022. Further, in January 2023, the FDA granted Fast Track designation to MRT-2359 for the treatment of patients with previously treated, metastatic NSCLC with L-MYC or N-MYC expression;

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Continue to advance and develop our pipeline of rationally designed MGDs to transform the treatment of diseases in multiple therapeutic areas. Through our QuEENTM platform, we have identified a variety of degron-containing proteins that are amenable to our approach and are either undruggable of insufficiently drugged. Our programs for CDK2, VAV1 and NEK7 are all in the lead optimization stage, and we anticipate nominating multiple development candidates for these programs in 2023. MRT-2359 and our CDK2, NEK7 and VAV1 programs are all examples of our successful application of our QuEENTM platform to the discovery of MGDs with the potential to be rapidly advanced through drug development. As we advance those programs in the clinic and to candidate selection, we continue to advance our other programs into lead optimization, and to identify new degron-containing target proteins as well as MGDs. We will continue to prioritize therapeutically-relevant target proteins backed by strong biological and genetic rationale with the goal of producing novel precision medicines. These opportunities include indications such as oncology, immunology, inflammation, as well as others;

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Continue to enhance and expand the capabilities of our QuEENTM platform to unlock the full therapeutic potential of our MGDs in our targeted therapeutic areas. We employ a core set of drug discovery and development principles to guide our target protein selection across various protein classes and therapeutic areas. We are specifically focused on delivering therapies to target proteins that have been considered undruggable or inadequately drugged in preclinically and clinically well-characterized biological pathways. Our QuEENTM platform enables us to vastly expand the degradable proteome beyond conventionally druggable target proteins. Our approach includes the computational identification of structural features on the surface of a protein that render a target protein amenable to complex formation with an E3 ligase bound by one of our MGDs. We combine our QuEENTM platform, including our AI/ML degron discovery engine, with our proprietary library of rationally designed MGDs to selectively connect degron-containing target proteins to E3 ligase proteins, including cereblon. QuEENTM has the potential to help us better understand the optimal pairing of degron-containing proteins with ligases to further expand our target space. We continue to invest in building our QuEENTM platform, including expanding our proprietary MGD library as well as our proteomics, in silico screening, pharmacogenomics and translational medicine capabilities;

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Expand and protect our proprietary know-how and intellectual property.We continue to expand intellectual property around our innovations in the field of targeted protein degradation and in particular MGDs. Our intellectual property, which includes proprietary know-how, patent applications and expected patents, as well as trade secrets, applies not only to our product candidates, but also to all of our various innovations, including, for example, our drug discovery processes including our QuEENTM platform; our AI-based E3

ligase characterization algorithms, AI-based degron discovery algorithms, AI-based novel MGD design algorithms, and in silico screening algorithms; our drug development tools; our growing library of MGDs; the innovative methods and approaches we have developed to rationally design MGDs to expand our library, and to certain biomarkers and therapeutic applications for our potential product candidates; and

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Consider strategic collaborations in select therapeutic areas to fully realize the potential of our QuEENTM platform. Our goal is to become a fully integrated biopharmaceutical company that delivers pioneering therapies for patients. We currently retain all rights to our programs and platform. To support our goal, we will selectively explore strategic partnerships where we can leverage complementary capabilities in discovery, development, and commercialization in disease areas within and outside our core areas of therapeutic focus to bring transformative therapies to patients with high unmet medical needs.

Background on targeted protein degradation and molecular glues

Proteins are large, complex molecules that are involved in essentially all biochemical reactions that take place in the body. Many human diseases are associated with abnormal intracellular protein behavior driven by modified functional activation or inactivation of the protein itself. Given their critical role, proteins are attractive therapeutic targets, including those that act inside the cell and on its surface. While significant progress has been made in the development of therapeutics that address malfunctioning proteins, about 75% of human proteins are still considered undruggable by traditional small molecules.

Challenges with druggable vs. undruggable proteins

The most common methods of targeting proteins, including intracellular proteins, involve traditional small molecule inhibitors that bind to a pocket in the protein and, there, act to inhibit or modify the function of the protein. Having such a pocket is what has traditionally led to a protein being considered druggable, yet most proteins lack suitably sized and shaped binding pockets. In particular, proteins such as transcription factors, those that act as scaffolding for other proteins, and modulators of enzyme activity, all of which can play a critical role in disease, often don’t have binding pockets suited for efficient ligand binding. The absence of a binding pocket presents a challenge to the development of traditional small molecule inhibitors. Other therapeutic modalities that can target such proteins, such as therapeutic antibodies, oligo-based nucleotides, and other genetic therapies, are limited in their ability to address aberrant protein behavior. Some of the therapeutic modalities have meaningfully advanced the treatment of disease and improved the quality of life for millions of patients. However, these modalities face specific challenges related to their mode of delivery, scalability, and their therapeutic application. A summary of these characteristics can be found in Figure 2.

Figure 2: The Next Generation of Precision Medicine-Based Small Molecule Drugs; Selectively Editing the Human Proteome with Rationally Designed MGDs

Molecular glues: a new approach to protein degradation

A new and promising approach to modulating protein function using small molecules in cells was recently elucidated: protein degradation. Illustrated in Figure 3, protein degradation is one of the body’s natural processes by which proteins are eliminated from human cells through the attachment of a molecular tag, called ubiquitin, to a protein by any of the approximately 600 human E3 ligases, marking the protein for degradation by the proteasome in the cell. Protein degradation can be induced by small molecule-based degraders, including both PROteolysis TArgeting Chimeras, or “PROTACs”, and MGDs. It was found that lenalidomide, now an approved best-selling drug in multiple indications with 2021 global sales of $12.8 billion, functioned as a small molecule-based degrader, or as an MGD, more specifically. In one of these indications, multiple myeloma, lenalidomide acts by causing two disease-driving transcription factors, IKZF1 and IKZF3, that lack druggable pockets, to bind to cereblon, an E3 ligase protein, resulting in their degradation. In this context, lenalidomide leads to the formation of a complex of IKZF1 and IKZF3 with cereblon by inducing surface complementarity between the components of the complex rather than by binding of the MGD into a succinct binding pocket on the protein target.

We believe the targeted protein degradation approach offers many features that make it an attractive therapeutic modality:

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Removal of a target protein: partial or complete removal of a target protein can lead to more complete inhibition of signaling and metabolic pathways, thus resulting in more profound pharmacodynamic effects than traditional reversible or irreversible inhibition.

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Targeting Intracellular proteins: small molecule-based protein degraders, in particular MGDs, readily cross cell membranes or can be optimized to do so.

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Ease of delivery: small molecule-based protein degraders, in particular MGDs, can be delivered through various routes of administration, including oral.

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Systemic and tissue distribution: since most small molecule-based degraders, in particular MGDs, are low molecular weight compared to other therapeutic modalities, tissue distribution, such as into the CNS or tumor tissues, poses less of an issue.

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Catalytic mode of action: after inducing degradation of a target protein molecule, the small molecule-based protein degrader-E3 ligase complex is able to induce the degradation of another target protein molecule. Thus, the small molecule-based protein degrader acts catalytically, unlike protein inhibition, causing the removal of many target protein molecules, thereby editing the cellular proteome.

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Event driven pharmacology: unlike with inhibitors where prolonged engagement of the drug with the protein is required for efficacy, small molecule-based protein degraders only require engagement with the E3 ligase and the target protein long enough to induce tagging for degradation

As mentioned above, there are multiple advantages of the protein degradation approach, but one of the most beneficial is the potential to achieve greater therapeutic efficacy resulting from the removal of a target protein from the cellular proteome.

Current approaches to protein degradation

While lenalidomide is an MGD, the majority of recent drug discovery efforts in the design of protein degraders has been focused on PROTACs. These heterobifunctional degraders are composed of two separate small molecules connected by a chemical linker. One molecule binds to a necessary binding pocket on the target protein and the other to a component of the E3 ubiquitin ligase complex. Binding of the PROTAC to both the protein of interest and the E3 ligase brings the target protein into proximity of the E3 ligase, resulting in tagging of the protein of interest for degradation. While this represents a novel way to eliminate therapeutically-relevant proteins from cells, we believe an MGD approach offers the following advantages over PROTACs:

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Ability to target undruggable proteins: MGDs utilize the richness of molecular surface features across the proteome allowing access to a broader and differentiated target space. In contrast, PROTACs require identification of a small molecule that binds to a defined binding pocket of a target of interest, which today largely constrains the approach to the universe of proteins that can already be addressed with small molecule inhibitors.

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Favorable pharmaceutical properties: The relative simplicity and size of an MGD generally allows for more rapid optimization for oral bioavailability. PROTACs often have a larger size and larger molecular weight due to their complex heterobifunctional structure, which may lead to challenges to develop the molecules into drugs suitable for oral dosing.

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Broader tissue distribution: The physicochemical properties of PROTACs may also limit the drug distribution within the body, thereby reducing the potential in certain therapeutics areas such as central nervous systems disorders. MGDs are more traditional small molecules and hence do not have these issues.

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No observable hook effect: MGDs show a more typical concentration response where increasing concentrations elicit increasing efficacy caused by the catalytic interaction. In contrast, PROTACs require a precise concentration range to elicit efficacy due to the loss of degradation potential at higher concentrations caused by their heterobifunctional structure (also known as “hook effect”).

Figure 3: Molecule Glue Degraders; Expanding Target Space, Fostering a New Generation of Drugs

In summary, and as shown in Figure 3, MGDs are non-heterobifunctional and do not require an active site or binding pocket on target proteins. We believe these properties potentially expand the universe of amenable target proteins while also maintaining the favorable drug-like properties of small molecule therapeutics.

Our approach

We design and develop molecular glue degraders or MGDs in a rational and iterative approach using our industry-leading and dynamic QuEENTM platform.

MGDs are small molecule-based protein degraders designed to modify an E3 ligase’s binding specificity and thus can employ the body’s natural mechanisms of protein destruction to selectively eliminate therapeutically-relevant proteins. Lenalidomide and pomalidomide are two approved drugs that were found to function as MGDs by causing the degradation of therapeutically-relevant proteins through the induced interaction with the E3 ligase cereblon, and provide clinical validation to the MGD approach.

Following the discovery that the clinically and commercially successful lenalidomide and pomalidomide were in fact MGDs, it was believed that the discovery of MGDs will mostly be through serendipitous findings, that MGDs could not be rationally designed and optimized to high levels of selectivity and achieve drug-like properties through conventional medicinal chemistry efforts, and that the target protein space for this approach is limited. Our QuEENTM platform was designed and built to address these issues. With QuEENTM we can discover and develop MGD product candidates that are potentially potent, selective and have favorable drug like properties in a target-centric, prospective and rational way against a wide variety of target proteins.

Figure 4: QuEENTM is Redefining the Rules of MGD Discovery

We believe our platform will continue to deliver MGD product candidates with the potential to address target proteins that have been considered undruggable or inadequately drugged, while possessing attractive pharmaceutical properties. Our initial programs are utilizing cereblon as the E3 ligase system to tag target proteins. Through our AI/ML platform and proprietary MGD library we have expanded and continue to expand chemical and target space. Further, we have started using the platform to leverage other E3 ligases as well.

Figure 5: Our Rational Approach to Unleash the Full Potential of MGDs

Our proprietary and industry-leading QuEENTM platform was built to support our target-centric approach to the discovery and development of MGD drugs that degrade a wide landscape of therapeutically-relevant target proteins by (i) systematically identifying degrons and other surface features on target proteins that may enable degradation through our approach; and (ii) rationally designing MGDs that can be optimized towards high potency and selectivity, with favorable pharmaceutical properties. Our proprietary library of rationally designed MGDs currently includes about 35,000 unique small molecules built around 400 cereblon binding scaffolds. Through our platform, we have built expertise that allows us to induce a high degree of surface complementarity between the E3 ligase and a target protein, potentially leading to high potency and selectivity for the therapeutically-relevant

target proteins we select. Figure 6 provides a schematic overview of some of the most unique and critical features our QuEENTM platform.

Figure 6: Monte Rosa’s QuEENTM Discovery Platform; An Industry Leading Target-Centric Approach to MGD Discovery and Development

Our proprietary and industry leading Quantitative and Engineered Elimination of Neosubstrates platform, or QuEENTM platform, encapsulates our team’s deep and growing expert knowledge and discovery capabilities across biology, chemistry and computational sciences, from which we are generating our library and pipeline of MGD product candidates. Central to our QuEENTM platform is a detailed understanding of the molecular interactions promoted by our MGDs between E3 ligases and therapeutically-relevant target proteins, which have been considered undruggable or inadequately drugged. We believe this depth of knowledge allows us to leverage our platform to rationally design MGDs with favorable pharmaceutical properties that have the potential to translate into clinical success across multiple therapeutic areas. Our capabilities have been developed through key features of our QuEENTM platform, which include our AI/ML engines, proprietary MGD library, and our high throughput proximity screening and chemo-proteomics capabilities, as described above.

Our process of degron discovery and MGD design is highly iterative and interdisciplinary, and is guided by our experience and powerful AI modeling. Computational predictions and analyses guide our high throughput screening and chemo-proteomics, which in turn provide more information to feed back into the AI engine, and all the accumulated knowledge is used to guide our MGD library expansion. For example, MGD discovery and development for a protein target can pass from degron identification, to MGD hit identification, to in silico improvement, to a round of chemo-proteomics validation, to chemical library alterations and back, until we reach the desired selectivity and degradation.

Our Proprietary MGD library

We continue to expand our highly diverse library of MGDs based on our growing expertise in MGD design and development captured in QuEENTM. We discover and develop lead MGDs for degron-containing target proteins by

applying our MGD library, computational chemistry tools, proximity screening tools, our chemo-proteomic capabilities and our knowledge of the cereblon-binding site and variations in degron structures. Our proprietary MGD library currently consists of over 400 unique scaffolds, each designed to probe different three-dimensional spaces. These scaffolds have been utilized to create a highly diverse proprietary library, currently consisting of approximately 35,000 unique MGDs. As shown in Figure 7, our MGDs are characterized by high structural diversity and leverage different areas of the cereblon surface to engage diverse degrons and target proteins. Our diverse library has given rise to multiple series of MGDs for each of the target proteins currently being studied across our disclosed and undisclosed portfolio.

With our experienced team of data scientists, structural biologists, biochemists, biologists and chemists, we have innovated proprietary tools designed to broadly match our MGDs against degron-containing target proteins. Our MGD design capabilities are driven by both in silico and laboratory-based assays that predict and assess the ability of our MGDs to induce the binding of target proteins to E3 ligase components, such as cereblon, and directly measure target degradation.

Figure 7: Monte Rosa Proprietary MGD Library: A Cereblon-Centric Library Characterized by Novelty and Structural Diversity

Our AI/ML engine Rhapsody enables in silico discovery of novel and highly selective MGDs

We have developed sophisticated and proprietary AI-powered algorithms to design novel MGDs, create ternary complex models for virtual screening and structure activity relationship or SAR optimization, and an in silico screening engine to identify and prioritize hits. Our pipeline integrates flexibility and active learning to quickly create ternary complex models for each target protein, enabling modeling, SAR engineering, and virtual screening. Our platform also leverages ensembles, molecular dynamics and quantum mechanics to identify and prioritize MGDs for synthesis and testing. We have named this engine RhapsodyTM.

For hit expansion and MGD optimization, Rhapsody is used to generate an in silico model of the MGD-specific, MGD-induced ternary complex. The engine includes modules for in silico docking, molecular fingerprinting, and SAR cliff discovery, enumeration, expansion, and generation, synthesis filtering, and structure- and ligand based virtual screening. Evaluation of the model allows us to rapidly predict which parts of the MGD anatomy are involved in target recruitment and which parts may be modified. This enables us to maintain or enhance the target-specific potency of the MGD, while optimizing its selectivity, and its other chemical and biological properties.

Rhapsody results are used to create and identify novel MGDs that are predicted to induce neosubstrate-specific ternary complex formation, are available for rapid synthesis, and can be prioritized for follow-up experiments. Many of these tools have been built around cereblon as an E3 ligase and are being applied to additional E3 ligases.

Our AI/ML engines OneVision and fAIceit identify reprogrammable E3 ligases and glueable target proteins

We have developed sophisticated and proprietary AI-powered algorithms to mine databases of protein sequences and structures, including structures determined from x-ray crystallography and structures from predicted protein folding. We have identified topological, structural and sequence features associated with published, or canonical, as well as newly discovered, or non-canonical, degrons and encoded these features in OneVisionTM and fAIceitTM, part of our suite of AI-powered algorithms that include modules leveraging highly customized geometric deep learning, deep neural networks, and molecular dynamics. We use OneVision to characterize E3 ligase surfaces, such as for propensity to form protein-protein interactions and the presence of small molecule ligand-binding pockets. Using both protein amino acid sequences and three-dimensional protein structures as inputs, we have deployed fAIceit to identify degrons with an initial focus on identification of degrons predicting putative neosubstrates of cereblon. Using fAIceit to computationally predict the presence of structural features with a high potential to function as a degron along with the presence of a surface complementary to cereblon, we have identified a variety of proteins with the potential to be neosubstrates, and many of them are target proteins in disease relevant pathways.

Figure 8: Monte Rosa’s Proprietary AI/ML Engine allows for Discovery of Glueable Target Proteins and Highly Selective MGDs

A key feature of the fAIceit process is the ability to integrate new discoveries from our proximity screening platform: as we characterize the activity of our expanding MGD library, fAIceit learns more degron features and, projecting these features into the entire proteome, identifies more potential neosubstrates targetable by our

MGDs. We are also applying fAIceit to identify candidate complementary target proteins to E3 ligases beyond cereblon prioritized by OneVision.

Figure 9: Monte Rosa’s Protein Surface Exploration AI Engines

High throughput proximity screening and chemo-proteomics capabilities

Quantitative biochemical and cellular assays

We have developed a suite of assays that have been tailored to measure specific steps of the MGD-induced protein degradation cascade. With our set of assays, we can measure ternary complex formation and screen for MGDs which have the most efficient binding characteristics. We have developed a Homogeneous Time Resolved Fluorescence, or HTRF, assay to measure ternary complex formation, whereby the close proximity of cereblon and the target protein are detected by fluorescent energy transfer between antibodies binding to the two proteins. We have used these types of assays to screen multiple target proteins using our proprietary MGD library. Our studies have validated the ability of MGDs to drive ternary complex formation in a concentration dependent manner. By measuring the dependency of ternary complex formation on MGD concentration, we generate concentration dependent curves, enabling us to calculate objective measures of potency such as the EC50, or the concentration at which the effect is half of the maximum.

We have also developed multiple assays to measure degradation of target proteins in cells. The HiBiT cellular assay is one example of a high-throughput assay that we have used to screen our proprietary MGD chemical library and identify MGDs that promote cellular target degradation in a selective manner. The assay measures the decrease in luminescence signal by using an endogenous HiBiT tag fused to the target of interest. Preclinical studies using our MGDs have shown these compounds can drive target degradation in a concentration dependent manner. By measuring the dependency of target protein levels on MGD concentration, we generate concentration dependent curves, enabling us to calculate objective measures of potency such as the DC50, or the concentration at which the degradation is half of the maximum, and the Dmax, the maximum amount of target protein that is degraded.

We are using our tailored suite of biochemical and cellular assays to screen, identify and rapidly optimize our MGDs. We have demonstrated that multiple target proteins from our degron database can be engaged and/or degraded using MGDs from our proprietary MGD library.

Quantitative chemo-proteomics profiling assays

Utilizing our expertise in mass-spectrometry-based proteomics, we have developed a suite of high throughput quantitative profiling assays to assess multiple parameters, including cellular target degradation, selectivity of degradation and ternary complex formation in cells, the latter allowing us to identify potential neosubstrates not yet predicted by our in silico approach. We utilize this information in multiple ways, including:

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To assess target degradation and determine the selectivity of our MGDs: Proteome wide changes in expression levels of proteins after treatment with a MGD are measured. Downregulation of protein levels is suggestive of degradation.

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To validate complex formation of our MGDs in cells: Proteins that are induced by the MGD to be proximal to the E3 ligase are tagged and enriched using a Turbo-ID proximity assay. This induced spatial proximity is suggestive of cellular ternary complex formation.

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To identify novel neosubstrates: Screening of our MGD library with the proximity-based assay provides additional unbiased data to identify novel degrons and train our computational degron prediction algorithms to further expand the target space.

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Additionally, we have created BaseCamp and Degron Pages, our suite of custom software tools for data processing, storage, analysis, and visualization. Through a web interface, these software tools enable every Monte Rosa scientist easy access to proximity platform screening results, Rhapsody in silico MGD designs and screening predictions, and the fAIceit degron interface identification. Using these proprietary tools, every scientist is empowered as an investigator to discover connections between MGDs, degrons, and diseases.

Figure 10: Our Chemoproteomics Platforms Accelerates Degron and MGD Discovery and Validation

As shown in Figure 11, our QuEENTM platform has enabled us to discover a broad landscape of degrons and degron-containing proteins. We have used our AI engine and a rational design approach to discover MGDs that are exquisitely selective. All combined, this allows us to potentially eliminate therapeutically-relevant target proteins in pathways that are highly relevant for diseases with high unmet need in oncology, immunology, inflammation as well as other diseases.

Figure 11: Discovering Diverse Degrons and Developing Highly Selective MGDs Against Them

QuEENTM expansion

Our QuEENTM platform was originally focused on identifying and developing MGDs that induce the binding of degron-containing neosubstrates to cereblon as a means of targeting them for degradation. We are expanding the scope of QuEENTM to grow the cereblon target space and to leverage additional E3 ligases for targeted protein degradation.

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Expand the cereblon neosubstrate universe: As we rationally designed our MGD compound library to increase diversity, we found in preclinical studies that there are novel degrons with a diversity of amino acid sequences and 3-dimensional structures that can be targeted, and we have shown we can induce efficient protein degradation through these previously undisclosed degrons. We have used our proprietary AI-driven algorithms to predict the existence of degrons from the primary sequences and the topology of proteins and are using our rational design approach to expand chemical diversity of our MGD library so to be able to target this diverse set of cereblon-accessible degrons.

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Utilize additional E3 ligases: We believe that we will be able to reprogram other E3 ligases through the discovery of ligase specific MGDs as well as specific ligase-accessible degrons, thus enabling us to generate ternary complexes with a further subset of the approximately 600 E3 ligases

Expanding the universe of neosubstrates or target proteins and and recruitment of such to additional E3 ligases through the continued identification of degrons has the potential to bring more therapeutically-relevant target proteins into the universe of degradable targets, which we anticipate will allow us to address additional therapeutic target proteins that are undruggable or insufficiently drugged.

Our Precision Medicine Approach for MYC-driven Cancers

MRT-2359, a highly selective and orally bioavailable GSPT1-directed molecular glue degrader (MGD) in development for the treatment of MYC-driven cancers

Overview

MRT-2359 is an orally bioavailable MGD that we have shown using extensive in vitro and in vivo studies to induce the degradation of GSPT1. GSPT1 (also known as eRF3a) is a translation termination factor that helps catalyze the termination of protein synthesis, facilitating the release of mRNA and newly synthesized protein from the ribosomal protein synthesis machinery. We have identified GSPT1 as a potential therapeutic vulnerability for MYC-driven cancers. MRT-2359, our GSPT1-directed MGD, is designed to preferentially affect growth and survival of cancer cells addicted to protein translation, such as those driven by high expression and activity of MYC family transcription factors. In vivo, once daily oral dosing of MRT-2359 led to a potent anti-tumor activity in

MYC-driven, cell-line-derived xenograft models as well as patient-derived xenograft models of NSCLC and SCLC. MRT-2359 is currently in a Phase 1/2 clinical trial for the treatment of MYC-driven and high-grade neuroendocrine tumors (ClinicalTrials.gov Identifier: NCT05546268).

Development of GSPT1-directed MGDs to Target Downstream Vulnerabilities of MYC Activation

In humans, the MYC family transcription factors comprises three proteins, c-MYC, L-MYC, and N-MYC. Upon activation in tumor cells, MYCs can function as oncogenic transcription factors. The MYC family transcription factors have long been recognized as drivers of multiple human cancers and are among the most frequently mutated, translocated and highly expressed oncogenes in human cancers. However, despite 40 years of drug discovery efforts, MYC has remained largely recalcitrant to new drug development and no approved therapies directly or indirectly targeting MYC family transcription factors have been developed to date.

It is well established that abnormal activation of MYC through translocation or high levels of expression results in uncontrolled cell growth that is associated with high rates of protein synthesis and ramp up of the protein translation machinery. MYC-driven tumors are therefore widely believed to be addicted to protein translation, and this addiction to protein translation creates an inherent dependency on critical components of the translation machinery, such as GSPT1, illustrated in Figure 12. As part of our research program, we identified GSPT1 as a potential novel vulnerability of MYC-driven cancers and, based on this observation, we believe that targeting GSPT1 with MGDs represents a viable approach for the treatment and management of patients with MYC-driven cancers. We believe that the administration of our GSPT1-directed MGD product candidate, MRT-2359, has the potential to address a critical downstream vulnerability of oncogenic MYC activation and provide a unique opportunity for therapeutic intervention.

Figure 12: The Role of GSPT1 in MYC-driven, Translationally Addicted Cancer Cells

Targeting GSPT1 with MRT-2359 (preclinical data and studies)

MRT-2359 is a potent and selective GSPT1-directed MGD discovered and rationally designed using our QuEENTM platform. Key features and parameters of MRT-2359 are provided in Figure 13.

Figure 13: MRT-2359 is a Selective and Orally Bioavailable GSPT1-directed MGD Rationally Designed Using our QuEENTM Discovery Engine

As shown in Figure 14, the sole ectopic overexpression of N-MYC or L-MYC was sufficient to sensitize initially insensitive NSCLC cells (NCI-H2023) to MRT-2359, corroborating a pivotal role of GSPT1 for the survival of MYC-driven cancer cells and demonstrating the potential of MRT-2359 to selectively inhibit growth and survival of L- and N-MYC expressing tumor cells. We believe these studies establish a causal link between N-MYC and L-MYC expression and the sensitivity to MRT-2359 not seen for other agents.

Figure 14: Overexpression of N-MYC or L-MYC is Sufficient to Sensitize Initially Resistant NSCLC Cells to MRT-2359

Preferential activity of MRT-2359 on growth and survival of MYC-driven cells was further validated in a panel of representative lung cancer cell lines. As shown in Figure 15, MRT-2359 profoundly and preferentially affected growth and survival of MYC-driven cell lines, such as high N- and L-MYC expressing NSCLC and SCLC lines, compared to their MYC low expressing counterparts. Similar observations were made in neuroendocrine or NE positive versus negative lung cancer cell lines.

Figure 15: Preferential Activity of MRT-2359 in MYC High NSCLC, SCLC or Neuroendocrine (NE) Positive Cancer Lines

As shown in Figure 16, MRT-2359 induced significant ribosomal stalling at the stop codon of mRNA transcripts only in the MYC high cell lines such as the NSCLC cell lines NCI-H1155. Only minimal effects on ribosomes were seen in the MYC low cell line NCI-H2023. In addition, MRT-2359 rapidly and completely abrogated protein synthesis in NCI-H1155 cells while exhibiting only marginal effects on translation in NCI-H2023 cells.

Figure 16: MRT-2359 Strongly and Preferentially Impaired Protein Translation in the N-MYC High Compared to the MYC Low NSCLC Cancer Cell Line

As shown in Figure 17, down modulation of the N-MYC oncogene and of its downstream target genes was observed in the NCI-H1155 cell line following MRT-2359 induced degradation of GSPT1. Further, N-MYC could not be detected in the NCI-H2023 cell line, and no significant effects were detectable on N-MYC downstream target genes after degradation of GSPT1.

Figure 17: MRT-2359 Downmodulated N-MYC and Its Downstream Target Genes in the N-MYC High Compared to the MYC Low NSCLC Cancer Cell Lines

Collectively, we believe that the inhibition of growth and survival of MYC-driven versus MYC-independent tumor cells results from a combination of (i) preferential degradation of GSPT1, (ii) preferential ribosome stalling and protein synthesis inhibition and (iii) downregulation of MYC-induced transcription in MYC-addicted but not MYC-independent tumor cells, as depicted in Figure 18.

Figure 18: Three Mechanisms Driving Preferential Activity in MYC High Cancer Lines

As shown in Figure 19, MRT-2359 demonstrated significant dose-dependent anti-tumor activity in vivo, including regressions, in an NCI-H1155 cell line-based xenograft model. In this study, MRT-2359 was dosed orally (PO) once daily (QD) at 1, 3 and 10 mg/kg. Figure 19 also shows that anti-tumor activity was accompanied by a dose -dependent reduction of levels of both GSPT1 and N-MYC protein following the administration of 5 consecutive doses of MRT-2359 at 1 and 10 mg/kg.

Figure 19: Anti-tumor Activity and Effects on GSPT1 and N-MYC of MRT-2359 in the N-MYC High NCI-H1155 NSCLC Xenograft Model

The anti-tumor activity of MRT-2359 was further assessed in 78 fully annotated lung cancer patient-derived xenograft or PDX models. As shown in Figure 20, models were selected across a wide range of L- and N-MYC mRNA expression levels or based on their NE status.

Figure 20: MRT-2359 Mouse-trial in NSCLC, SCLC and Lung NE Patient-derived Xenografts

As shown in Figure 21, oral dosing of MRT-2359 demonstrated preferential activity in models expressing high levels of L- and N-MYC within both NSCLC and SCLC PDXs, including numerous instances of tumor regressions. Similar levels of anti-tumor activity were observed in neuroendocrine lung cancer PDX models.

Figure 21: MRT-2359 Demonstrated Preferential Anti-tumor Activity in MYC High or Neuroendocrine (NE) Lung Cancer PDXs

As shown in Figure 22, we analyzed the expression of both L-MYC and N-MYC in samples from patients with both NSCLC and SCLC using real world genomic data and determined the frequency to be 15% and 72% respectively. (Figures adapted from real world molecular and genomic data analysis on 3241 lung cancers in collaboration with Tempus Labs, Inc.).

Figure 22: Real-world Data Analysis of L-MYC and N-MYC mRNA Expression and Amplification in Lung Cancer

Non-small cell lung cancer

There are an estimated 238,000 new cases of lung cancer diagnosed in the United States each year, and lung cancer causes 127,000 deaths annually in the United States. NSCLC accounts for 80% to 85% of lung cancer cases.

While targeted therapies have been developed for patients with certain tumors, less than thirty percent of patients are eligible for these therapies. Patients who are ineligible or resistant to these therapies can be treated with immune checkpoint inhibitors that lead to significant improvements in progression free survival and overall survival compared to standard chemotherapy. However, despite the availability of these therapies, very few patients are cured of their disease and the prognosis in NSCLC remains poor, with an average five-year survival rate for newly diagnosed patients with NSCLC of 28 percent. Accordingly, there is an unmet medical need for the treatment of patients with NSCLC.

As shown above in Figure 22, our data as well as data from the analyses of molecular data from NSCLC tumors found that around 15% of NSCLC tumors have elevated L- or N-MYC expression. We believe that our preclinical data, presented above, supports that these tumors will be sensitive to our GSPT1-directed MGD, MRT-2359.

Small cell lung cancer

SCLC is estimated to represent approximately 15% of all lung cancers, accounting for 30,000 new cases a year in the United States. SCLC is a rapidly progressive disease with short overall survival after initial therapeutic responses. SCLC is derived from neuroendocrine cells and is distinguished clinically from NSCLC by its rapid doubling time and the early development of metastases. Most patients have metastatic disease at the time of their initial diagnoses.

Unlike in NSCLC, which has seen a steady stream of new drug approvals over the last 2 decades, the progress and consequent improvement in treatment outcomes in SCLC have been more modest. The 5-year survival rate for patients with extensive stage SCLC, which accounts for 80% of all patients diagnosed, remains at 3% with a median survival between 10-13 months. Patients with limited stage SCLC can be treated with combined chemoradiation; however, the 5-year survival rates fluctuate between 30% to 40%. Most patients with SCLC are responsive to chemotherapy, but eventually relapse. In extensive stage SCLC, immune checkpoint inhibitors atezolizumab and durvalumab have been approved for use in conjunction with chemotherapy. Overall response rates for chemotherapy, with or without immunotherapy, are around 60%; however, the median progression-free survival ranges from 4-5 months and the overall survival ranges from 10‐13 months. Upon relapse, patients are offered alternative therapies based on their quality and duration of response to initial treatment, but most are chemotherapy-based. Expected outcomes in previously treated patients remain unsatisfactory with response rates between 25% to 35%, which creates a significant unmet need for development of new therapies. There are no targeted therapeutics available for SCLC patients.

As shown above in Figure 22, our data as well as data from the analyses of molecular data from other SCLC tumors found that over half of these tumors have elevated levels of L- and N-MYC expression. We believe that our preclinical data presented above supports that these tumors will be sensitive to our GSPT1-directed MGD, MRT-2359.

Potential Indications

We believe that there are multiple other tumor types, beyond NSCLC and SCLC, in which the MYC pathway is highly activated. As shown in Figure 23, in addition to the current indications included in the MRT-2359-001 Phase 1/2 clinical study, future indications may include triple-negative breast cancer, ovarian and endometrial cancers, bladder cancer, all driven by L- and N-MYC to a substantial degree, as well as various c-MYC driven cancer types.

Figure 23: Targeting L-/N-MYC positive and Neuroendocrine Tumors with MRT-2359

MRT-2359-001 Phase 1/2 Study

Our ongoing Phase 1/2, open-label, multicenter study, illustrated in Figure 24, will primarily assess the safety, tolerability, PK, PD, and preliminary clinical activity of MRT-2359 in patients with previously treated selected solid tumors. In the Phase 1 dose escalation portion of the clinical trial, we are enrolling patients with tumors that have a significant likelihood of being MYC-driven, including patients with NSCLC, SCLC, high-grade neuroendocrine cancer of any primary site, DLBCL and patients with solid tumors that harbor L-MYC or N-MYC amplifications. In this phase of the trial, tumors will be tested retrospectively for biomarkers of MYC activation. Patients will receive escalating doses of MRT-2359 to determine the maximum tolerated dose or MTD and recommended Phase 2 dose or RP2D.

Once the MTD and/or RP2D are determined, the anti-tumor activity of MRT-2359 will be assessed in the Phase 2 portion of the study, which will enroll NSCLC and SCLC stratified per L-MYC or N-MYC expression, and solid tumors with L-MYC or N-MYC amplification. We expect to disclose initial clinical data including PK, PD, safety and available initial efficacy from the Phase 1 arm of the ongoing Phase 1/2 clinical trial evaluating MRT-2359 in the second half of 2023.

Figure 24: MRT-2359 Clinical Study Design

CDK2-directed MGD molecules for the treatment of cancer

Cyclin dependent kinases, or CDKs, are a family of closely related kinases that regulate progression through the cell cycle. CDK activity is modulated by specific cyclins. For example, cyclin E1 activates cyclin-dependent kinase 2, or CDK2 (Figure 25). CDK2 can be activated in tumors by the amplification or overexpression of Cyclin E1 or E2, or loss-of-function alterations of the retinoblastoma or RB1 gene. Cyclin E1 dysregulation has been found in several cancers, including ovarian and triple negative breast cancer. In addition, cyclin E1 dysregulation and CDK2 activation has also been found to be one of the mechanisms of resistance in estrogen receptor-positive breast cancer patients treated with CDK4/CDK6 inhibitors such as palbociclib. Therefore, we believe selective elimination of CDK2 using CDK2-directed MGDs may provide benefit to these patients. Previously reported small molecule inhibitors and PROTACs of CDK2 have been limited in their selectivity due to the high degree of similarity among the active sites of kinases, in particular within the CDK family itself. We have identified multiple MGD molecules that selectively promote the association of CDK2 and cereblon in vitro, while avoiding other CDKs. The most advanced compounds robustly and selectively induce the degradation of CDK2 in multiple cancer cell lines in vitro with concomitant inhibition of proliferation. Lead optimization chemistry is ongoing.

Figure 25: CDK2 is One of the Key Regulators of the Cell Cycle

Identification of CDK2 degron CDK2-directed MGDs

To identify molecular glue degraders targeting CDK2, we screened our proprietary MGD library in a biochemical HTRF assay to detect the formation of a ternary complex between cereblon, an MGD and CDK2. Through iterative chemistry based on the screening hits, we rapidly identified a series of MGDs that promoted the association of CDK2 with cereblon.

We confirmed that these CDK2-directed MGDs showed concentration-dependent ternary complex formation. We also assessed the biochemical selectivity of the hits over CDK1, CDK4 and CDK9 using similar HTRF assays. No ternary complex formation with these closely related kinases was observed (data not shown). Based on these initial results, we have initiated lead optimization chemistry and have successfully delivered several lead compounds from different chemical series. Using structural analysis of the interaction between cereblon, the MGD and CDK2, we have discovered a novel, previously unknown degron on CDK2.

In vitro data

Our lead optimization process has provided several MGDs that promote ternary complex formation. In addition, we have shown specific degradation of CDK2 with our MGDs, with no significant effect on other CDKs or other kinases, as shown in Figure 26.

Figure 26: CDK2-directed MGD Showed Selective Degradation Over the Other CDKs

In addition, in cellular assays we have shown that a CDK2-directed MGD blocked DNA replication (S phase) in CDK2 dependent cells, induced a reduction of proteins in the E2F pathway and inhibited cellular proliferation in a concentration-dependent manner, as shown in Figure 27.

Figure 27: CDK2-directed MGD Showed Biological Activity in a CDK2 dependent Cell Line

VAV1-directed MGD molecules for the treatment of autoimmune diseases

VAV1, a Rho-family guanine nucleotide exchange factor, is expressed in immune cells including T and B cells and functions to mediate T and B cell receptor signaling (shown in Figure 28). Because of VAV1’s function in both T and B cells, degradation could provide therapeutic benefits in multiple autoimmune diseases, including multiple sclerosis, myasthenia gravis, and rheumatoid arthritis. VAV1 degradation may also provide a benefit in the transplantation setting and graft versus host disease, preventing organ rejection. Recent studies, which included multiple whole-genome CRISPR screens in primary human T cells, have further validated VAV1’s role as a key player in T-cell function, showing that the genetic elimination of VAV1 attenuated T-cell activity, exemplified by reduced IL-2 secretion in Figure 28, right panel.

While considered an undruggable protein, with no small molecule drugs known to inhibit its function in clinical development, we identified VAV1 as a degron-containing protein and have discovered VAV1-directed MGDs that in preclinical studies promoted the association of VAV1 and cereblon and led to the degradation of VAV1 protein. We have further optimized our lead MGDs derived from a highly selective chemical series and are currently completing lead optimization. We believe our unique ability to specifically target VAV1 provides us with a new therapeutic approach with the potential to treat a variety of autoimmune pathologies in a large patient population with significant medical needs.

Figure 28: VAV1 is a Highly Validated Target for Attenuating T-cell Activity

Identification of VAV1 degron and VAV1-directed MGDs

Our degron identification algorithm, fAIceitTM, indicates that VAV1 contains a unique degron compared to other members of the VAV family of GEFs, suggesting we can target VAV1 selectively with our MGD molecules. As shown in Figure 29, left panel, structural analysis of the complex formed between cereblon, VAV1 and the MGD shows the predicted degron indeed participates in the protein interface. The right panel of Figure 29 shows the highly selective degradation of VAV1 in a T-cell derived cell line (Jurkat), and the dose-dependent degradation of VAV1 in human primary T-cells, with a resulting decrease in CD69 activation, IL-2 secretion, and cellular proliferation.

Figure 29: Rationally Designed Highly Selective VAV1-directed MGDs

In vivo studies with our VAV1-directed MGDs

Highlighted here are experiments focused on an experimental autoimmune encephalomyelitis or EAE mouse model of multiple sclerosis, where T-cells play a major role in progression of the disease. In Figure 30, left panel, following a single oral dose of a VAV1-directed MGD in mice, we see a rapid decrease in VAV1 protein, associated with the presence of the VAV1-directed MGD in plasma (green), that was sustained out to 24h post dose. In the EAE model, disease was induced at day 0. Upon disease establishment, the same VAV1-directed MGD or dexamethasone were dosed daily starting on day 12. Mice were scored for EAE clinical signs of disease (0 = no signs of disease; 1 = limp tail or hind limb weakness; 2 = limp tail and hind limb weakness; 3 = partial hind limb paralysis; 4 = complete hind limb paralysis; 5 = moribund). The right panel of Figure 30 shows that orally dosed VAV1-directed MGD inhibited disease progression in the EAE model similar to dexamethasone, a corticosteroid used broadly in auto-immune disease.

Figure 30: VAV1-directed MGD Inhibited Disease Progression in an EAE Mouse Model

NEK7-directed MGDs for the treatment of inflammatory disease

The NLRP3 inflammasome is a multiprotein complex that serves as a central node to integrate cellular signals generated by pathogens, damage and stress, and subsequently triggers the generation of pro-inflammatory cytokines, as shown in Figure 31. Aberrant NLRP3 inflammasome activation has been implicated in several autoinflammatory disorders including gout, Crohn’s disease, neurodegenerative diseases, diabetes and liver

disease. Additionally, multiple activating NLRP3 mutations have been shown to be associated with Cryopyrin-associated periodic syndromes, shown in Figure 31.

NIMA-Related Kinase 7, or NEK7, a serine/threonine-protein kinase, activates the NLRP3 inflammasome in a kinase-independent manner, suggesting that degradation of NEK7 with an MGD molecule is an attractive therapeutic approach. NEK7 binding to NLRP3 is an essential step in promoting the assembly of the NLRP3 inflammasome. The assembly of NLRP3/NEK7 with ASC and pro-caspase 1 in a multi-protein complex induces cleavage of pro-caspase 1, which then activates multiple inflammatory responses including secretion of the cytokines interleukin-1ß and interleukin-18 and the induction of pyroptosis, as depicted in figure 31. Knockout of NEK7 in animal models has been shown to decrease inflammatory signaling, which leads to decreased disease severity in models of inflammatory diseases.

Figure 31: NEK7 is an Essential Regulator of the Inflammasome

Figure 32: Overactivation of the NLRP3 Inflammasome in Disease

Activation of the NLRP3 inflammasome is driven through a kinase-independent function of NEK7, suggesting that inhibition of the catalytic activity of NEK7 would be ineffective in blocking NLRP3 inflammasome activation. We found that NEK7 contains a well-defined degron and have identified MGDs that are highly selective for NEK7 in in vitro models. We are currently optimizing MGDs that are derived from multiple chemical series in this program.

Identification of NEK7 degron and NEK7-directed MGDs

NEK7 contains a well-defined degron, as identified using our proprietary QuEENTM platform (shown in Figure 33, left panel). Given the kinase-independent role of NEK7 in activating the NLRP3 inflammasome, we believe that degradation of NEK7 with our MGDs will be preferable over conventional catalytic inhibition strategies. We have generated MGDs that promoted the association of NEK7 with cereblon, and the program is currently at the lead optimization stage.

Figure 33: Rationally Designed NEK7-directed MGD promotes selective degradation of NEK7

The amino acid sequence of the NEK7 degron is unique among the NEK family members, indicating the potential to identify MGDs that are highly selective for NEK7. Our lead optimization process has provided several MGDs that promote ternary complex formation and highly selective degradation of NEK7. As shown in Figure 33, right panel, U937 cells were treated with one of our MGDs for 24 hours, followed by proteomic profiling. Highly selective and profound degradation of NEK7 is evidenced by selective decrease in NEK7 protein fold-change, without significant changes in other detected proteins. Other NEK family members are highlighted on the volcano plot and confirmed not to be degraded.

NEK7-directed MGDs show high potency modulation of the NLRP3 pathway in human monocyte-derived macrophages

To assess the functional impact of NEK7 degradation on NLRP3 inflammasome activation, we treated human monocyte-derived macrophages, or hMDMs, with increasing concentrations of one of our NEK7-directed MGDs. We measured IL-1β and IL-18 secretion from hMDMs following pre-treatment with our MGD and subsequent exposure to inflammasome stimulators LPS and monosodium urate crystals or MSU.The MSU stimulus is relevant to the setting of gout, where high uric acid levels lead to accumulation of MSU crystals in joints and the subsequent pathogenic activation of NLRP3 inflammasome. As shown in Figure 34, our NEK7-directed MGD led to a dose-dependent decrease in IL-1β (left) and IL-18 (right) secretion. We also compared the activity of our MGD to the NLRP3 inhibitor MCC950 and, as shown in Figure 34, our MGD shows superior modulation of NLRP3 pathway-induced IL-1β and IL-18 secretion.

Figure 34: NEK7-Directed MGDs Modulate NLRP3 Pathway in Human Macrophages

MGDs targeting Transcriptional Repressors for the treatment of Hemoglobinopathies (SCD and β-Thalassemia)

Sickle cell disease, or SCD, is caused by a mutation in a form of hemoglobin, leading to severe disease manifestations, including anemia and vaso-occlusive crises. However, in SCD patients, increasing levels of fetal hemoglobin, or HbF, are associated with fewer co-morbidities and a better prognosis. In adults, several transcription repressors prevent transcription of the HBG gene, thereby silencing HbF expression. We believe that degradation of one of these repressors to reactivate HbF expression is a promising therapeutic strategy, and it is being clinically tested by third parties to treat SCD using adoptive cell therapy. These repressors have to date been considered undruggable using small molecule therapies. We believe reactivation of HbF through MGD-mediated protein degradation could be used as a therapeutic strategy for both SCD as well as other hemoglobinopathies, such as ß-Thalassemia, as shown in Figure 35.

Figure 35: Zinc finger domain-containing transcriptional repressors of the fetal globin genes

Current status and next steps of our discovery programs

We are currently optimizing chemical leads that are derived from multiple series of MGD molecules in our CDK2, NEK7, VAV1 and sickle cell disease programs. Our VAV1, CDK2 and NEK7 programs are currently in lead optimization with the next anticipated milestone being selection of a development candidate and the initiation of IND-enabling studies.

Other programs

We are specifically focused on developing product candidates for target proteins that have been deemed undruggable or inadequately drugged. Our QuEENTM platform was purpose-built to support the discovery and development of drugs that degrade a wide landscape of therapeutically-relevant proteins by (i) systematically identifying therapeutically-relevant target proteins that may be amenable to molecular glue-based degradation; and (ii) rationally designing molecules that can be optimized towards high potency and selectivity, with properties that we believe to be favorable. Our early pipeline includes programs in genetically defined oncology indications, as well as inflammatory, immunologic and other disease indications. We are further engaged in the discovery of additional target proteins in other indications, including, but not limited to, neurodegenerative and other neurological diseases.

Figure 36: Monte Rosa Therapeutics; From Serendipity to Rational Design of MGDs

Our services, collaboration and licenses agreements

Agreements with Cancer Research Technology Limited and the Institute of Cancer Research

Cancer Research Technology Limited or CRT and the Institute of Cancer Research or ICR jointly own certain intellectual property generated at the ICR using funding from Cancer Research UK or CRUK related to the field of protein degradation. In April 2018, we concurrently entered into a license agreement, or the License Agreement, with CRT and the ICR, and a formation and investment agreement, or the Formation and Investment Agreement with CRT and the ICR, pursuant to which we agreed to issue an aggregate of 1,132,984 common shares to CRT, the ICR and affiliated founding scientists as consideration for the rights granted under the License Agreement at a price per share of CHF 0.04 for an aggregate purchase price of CHF 40,000.

Collaboration and option agreement

In April 2018, we entered into the Collaboration and Option Agreement, with CRT, a wholly-owned subsidiary of CRUK, and the ICR, to support our early product develop as we built our internal capabilities. Under the Collaboration and Option Agreement, the ICR was responsible for performing certain research and development activities through December 31, 2020, or the Collaboration Term, which included assembling a library of cereblon-binding compounds and identifying and validating new biological target proteins for drug discovery through phenotypic cell based screening. During the Collaboration Term, we paid the ICR certain amounts to cover the cost of employing eight full-time employees and certain research outsourcing costs.

Under the Collaboration and Option Agreement, we are obligated to, among other things, use commercially reasonable efforts to (i) develop one or more products covered under the Collaboration and Option Agreement for use in human clinical trials, including at least one product with an application in oncology indication, (ii) pursue regulatory authorization for each product and, where applicable, price approval in at least one major market (iii) introduce and commercialize each product in major markets where regulatory authorization and, where applicable, price approval for such product has been obtained.

Pursuant to the Collaboration and Option Agreement, we may be obligated to pay CRT certain milestone payments upon the achievement of specific clinical progression events and sales-based royalties for certain products. Whether or not we are obligated to pay such milestones and royalties will depend on whether any product is subject to the Collaboration and Option Agreement. If owed, milestone payments could total up to $7.0 million for any first covered product we develop that is subject to the Collaboration and Option Agreement and $3.5 million for any additional covered product we develop that is subject to the Collaboration and Option Agreement. We may also be obligated to pay CRT low-single digit royalties on net sales on a product-by-product and country-by-country basis for any covered product that is subject to the Collaboration and Option Agreement. Our obligation to pay royalties will expire upon the later of (i) the expiration of the last patent which covers such

product in such country; (ii) 10 years following the first commercial sale of such product in such country; and (iii) the expiration of any extended exclusivity period in the relevant country. We have paid $4.8 million under the Collaboration and Option Agreement for activities that occurred during the Collaboration Term.

All intellectual property developed or discovered pursuant to the research collaboration during the Collaboration term is owned by us, subject to the ICR’s and CRT’s rights in and to their pre-existing intellectual property and the ICR’s and CRT’s research rights; provided, however, any substrate list and target deconvolution data that is generated by or on behalf of the ICR in connection with its independent research and screening activities that result in a non-degradation program may be jointly owned by CRT and the ICR under certain conditions. We are permitted to grant sub-licenses in respect of the rights granted under the Collaboration and Option Agreement, subject to certain limitations.

Even though the Collaboration Term under the Collaboration and Option Agreement expired on December 31, 2020, the term of the Collaboration and Option Agreement itself continues until it is otherwise terminated by (i) either party in the event of an uncured material breach or upon an insolvency event, (ii) mutual agreement of the parties for any reason, (iii) us in the event that CRT and/or the ICR challenges the validity of any patent made or conceived pursuant to the research collaboration or if the joint steering committee determines that the continuation of the research collaboration would be commercially unreasonable, scientifically unviable, illegal or impossible or (iv) CRT and the ICR (acting together) in the event that any person who develops, sells or manufactures tobacco or otherwise makes a majority of its profits in the tobacco business acquires more than 50% of our voting securities or if we permanently abandon all discovery, development and commercialization efforts for all products covered under the research collaboration.

License agreement

Under the License Agreement, CRT and the ICR granted us a worldwide, exclusive, fully-paid, irrevocable, perpetual, sub-licensable license to (i) CRT and the ICR’s intellectual property rights in its compound library to research, develop and commercialize products that (a) contain or comprise such compounds or (b) are discovered, developed or generated using or incorporating CRT and the ICR’s existing intellectual property, or Licensed Products, and (ii) CRT and the ICR’s certain specified know-how and other intellectual property rights unrelated to its compound library to research, develop and commercialize products designed or intended to have a primary mechanism of action through cereblon-mediated protein degradation, or Protein Degradation Products, in each case of (i) and (ii), for the treatment, prevention and/or diagnosis of any and all diseases, disorders or conditions. CRT and the ICR also granted us a worldwide, non-exclusive, fully-paid, irrevocable, perpetual and sub-licensable license to certain of CRT and the ICR’s specified non-compound intellectual property rights and know-how to research, develop and commercialize Licensed Products and Protein Degradation Products for the treatment, prevention and/or diagnosis of any and all diseases, disorders or conditions. The foregoing exclusive license is subject to CRT and the ICR’s retained rights to practice certain specified licensed intellectual property rights to carry out noncommercial academic research and teaching.

In consideration for the rights granted under the License Agreement, we issued an aggregate of 1,132,984 common shares to CRT, the ICR and affiliated founding scientists pursuant to the Formation and Investment Agreement for an aggregate purchase price of CHF 40,000 and paid CRT a technology access fee equal to approximately $42,000. The License Agreement will remain effective until terminated by written agreement between us, CRT and the ICR.

Competition

The biotechnology industry is extremely competitive in the race to develop new products and the industry is characterized by a high level of innovation and strong emphasis on proprietary products and intellectual property rights. While we believe we have significant competitive advantages due to our management team’s years of expertise in protein degradation, molecular glues and clinical and preclinical development of precision medicines in general, coupled with our unique scientific expertise and our growing portfolio of intellectual property rights, we currently face and will continue to face competition for our development programs from other companies that develop heterobifunctional degraders, similar molecular glue degraders or have protein degradation development platforms and their own associated intellectual property. Our competition will also include companies focused on existing and novel therapeutic modalities such as small molecule inhibitors antibodies and gene therapies. The competition is likely to come from multiple sources, including large and specialty pharmaceutical companies, biotechnology companies and academic institutions that are in the business of research, development, manufacturing and commercialization. Moreover, the existence of large numbers of patents and frequent allegations of patent infringement is typical in our industry.

Competitors in our efforts to develop MGD therapeutics for patients, include, but are not limited to, BioTheryX Therapeutics, Inc., C4 Therapeutics, Inc., Nurix Therapeutics, Inc., Kymera Therapeutics, Inc., Seed Therapeutics, Inc., Plexium Inc, Bristol-Myers Squib, and Novartis, all of whom have reported having MGD product candidates in preclinical or clinical development. In addition, lenalidomide and pomalidomide, which are both marketed by Bristol-Myers Squibb, have been shown to function as MGDs. Further, several large pharmaceutical companies have disclosed investments in this field.

In addition to the competitors we face in developing small molecule-based protein degraders, we will also face competition in the indications we expect to pursue with our MGD programs. Many of these indications already have approved standards of care which may include existing therapeutic modalities. In order to compete effectively with these existing therapies, we will need to demonstrate that our MGDs perform favorably when compared to existing therapeutics.

Manufacturing

We do not own or operate manufacturing facilities for the production of our product candidates and we currently have no plans to build our own clinical or commercial scale manufacturing capabilities. We currently contract with third-party contract manufacturing organizations, or CMOs, for the manufacture of our product candidates and we intend to continue to do so in the future. We rely on and expect to continue to engage on third-party manufacturers for the production of both drug substance and finished drug product. We currently obtain our supplies from these manufacturers on a purchase order basis and do not have long-term supply arrangements in place. Should any of these manufacturers become unavailable to us or their services to us become delayed for any reason, we believe that there are a number of potential replacements, although we may incur some delay in identifying and qualifying such replacements.

Intellectual property

We are an innovation-driven company and we seek to aggressively protect the innovations, intellectual property, and proprietary technology that we generate that we consider important to our business, including by pursuing patent applications that cover our product candidates and methods of using the same, innovations around our industry leading QuEENTM platform and our proprietary library of MGDs, as well as any other relevant innovations, inventions, and improvements that are considered potentially commercially relevant to the development of our business and to maintain our perceived competitive advantages. We also rely on trade secrets, know-how and continuing technological innovation to develop and maintain our proprietary and intellectual property position. For our product candidates, we generally intend to pursue patent protection covering compositions of matter, pharmaceutical compositions, methods of use, including combination therapies, methods of administration including dosing methods, methods for monitoring potential clinical events, compositions and methods for personalizing, monitoring, and potentially refining clinical use, including biomarkers, processes of manufacture and process intermediates, where relevant. For our QuEENTM platform, we generally intend to pursue patent protection covering our approaches, methods, and research and development tools relevant to our degron database, our Rhapsody, tools, and our library of MGDs. We continually assess and iteratively refine our intellectual property strategies as we develop new innovations and product candidates. We currently plan to continue to invest in filing additional patent applications based on our intellectual property strategies to continue to build value in our business and/or to improve our business and potential partnering opportunities, where appropriate.

Our commercial success depends, in part, on our ability to obtain, maintain, enforce and protect our intellectual property and other proprietary rights for the technology, inventions and improvements we consider important to our business, and to defend any patents we may own or in-license in the future, prevent others from infringing any patents we may own or in-license in the future, preserve the confidentiality of our trade secrets, and operate without infringing, misappropriating or otherwise violating the valid and enforceable patents and proprietary rights of third parties.

As with other biotechnology and pharmaceutical companies, our ability to maintain and solidify our proprietary and intellectual property position for our product candidates and technologies will depend on our success in obtaining effective patent claims and enforcing those claims if granted. However, our pending provisional and Patent Cooperation Treaty, or PCT, patent applications, and any patent applications that we may in the future file or license from third parties, may not result in the issuance of patents and the validity and/or enforceability of any of our issued patents may be challenged by third parties. Further, as with other companies, the patents we may obtain do not guarantee us the right to practice our technology in relation to the commercialization of our

products. Regarding obtaining issued patents, here in the United States as well as in other jurisdictions of interest to our business, the patent positions for biopharmaceutical companies like us are generally uncertain and can involve complex legal, scientific, and factual issues. Further, the laws governing the protection of intellectual property may change over time due to the issuance of new judicial decisions or the passage of new laws, rules or regulations. In addition, the coverage claimed in a patent application can be significantly reduced before a patent is issued and its scope can be reinterpreted and challenged even after issuance. As a result, we cannot guarantee that any of our product candidates will be protected or remain protectable by valid, enforceable patents. We also cannot predict whether the patent applications we are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from competitors. Any patents that we hold may be challenged, circumvented, or invalidated by third parties.

The exclusivity terms of our patents depend upon the laws of the countries in which they are obtained. In the countries in which we currently intend to file, the patent term is 20 years from the earliest date of filing of a non-provisional patent application. The term of a U.S. patent may be extended to compensate for the time required to obtain regulatory approval to sell a drug (referred to as a patent term extension) or by delays encountered during patent prosecution that are caused by the United States Patent and Trademark Office (referred to as patent term adjustment). For example, the Hatch-Waxman Act permits a patent term extension for FDA-approved new chemical entity drugs of up to five years beyond the ordinary expiration date of one patent that covers the approved drug or its use. The length of the patent term extension is related to the length of time the drug is under regulatory review and diligence during the review process. Patent term extensions in the United States cannot extend the term of a patent beyond a total of 14 years from the date of product approval and only one patent covering an approved drug or its method of use may be extended. A similar kind of patent extension, referred to as a Supplementary Protection Certificate, is available in Europe. Legal frameworks may also be available in certain other jurisdictions to extend the term of a patent. We currently intend to seek patent term extensions for our products on any of our issued patents in any jurisdiction where we have a qualifying patent and the extension is available; however, there is no guarantee that the applicable regulatory authorities, including the FDA in the United States, will agree with our assessment of whether extensions of this nature should be granted and, even if granted, the length of these extensions. Further, even if any of our patents are extended or adjusted, those patents, including the extended or adjusted portion of those patents, may be held invalid or unenforceable by a court of final jurisdiction in the United States or a foreign country.

Patents and Patent Applications

As of December 31, 2022, we solely owned a patent portfolio that included twenty-eight (28) pending patent families, including fourteen pending patent application filed under the Patent Cooperation Treaty and multiple pending United States provisional patent applications. Our portfolio is being built to cover our MGDs product candidates and various uses thereof, MGDs drawn to currently undisclosed target proteins and uses thereof, and our industry-leading QuEENTM platform, as further described below. Patent prosecution related to our portfolio is currently in the early stages and, as such, no patent examiner has yet fully scrutinized the merits of any of our pending patent applications.

Wholly Owned Product Candidates

With respect to our GSPT1 program, as of December 31, 2022, our portfolio included eight pending PCT patent applications, two pending non-provisional patent application in the United States, and patent applications in Europe and Japan that cover various GSPT1-directed MGDs and uses thereof. These patent applications are drawn to composition of matter, pharmaceutical compositions, and methods of using our GSPT1-directed MGDs. We also owned one pending PCT application, that cover biomarkers related to use of our GSPT1-directed MGDs. The earliest scheduled expiration of any U.S. or foreign patent drawn to our GSPT1-directed MGDs, if such patent is issued, would be 2040, excluding any additional term for available patent term adjustment or patent term extension, and assuming timely payment of all applicable maintenance or annuity fees.

With respect to our CDK2 program, as of December 31, 2022, our portfolio included two pending PCT applications and two pending U.S. provisional patent applications that cover various CDK2-directed MGDs and uses thereof. The earliest scheduled expiration of any U.S. or foreign patents issuing from these PCT applications or U.S. provisional patent applications, if such patents are issued, would be 2042, excluding any additional term for available patent term adjustment or patent term extension.

With respect to our NEK7 program, as of December 31, 2022, our portfolio included two U.S. provisional patent applications that cover various NEK7-directed MGDs and uses thereof. The earliest scheduled expiration of any U.S. or foreign patents issuing from these U.S. provisional patent applications, if such patents are issued, would be 2042, excluding any additional term for available patent term adjustment or patent term extension.

QuEENTM platform

With respect to our QuEENTM platform, as of December 31, 2022, our portfolio included four U.S. provisional patent applications and two pending U.S. provisional patent applications drawn to our QuEENTM platform and uses thereof for the design, discovery, and development of MGD product candidates. The earliest scheduled expiration of any U.S. or foreign patent issuing from these U.S. provisional patent applications, if such patents are issued, would be 2042, excluding any available additional term for patent term adjustment or patent term extension.

Trademarks

As of December 31, 2022, we owned various registered and unregistered trademarks in the United States, including Monte Rosa Therapeutics, our housemark logo, the name of our QuEENTM platform, and the name of our Glueomics resource.

Trade Secrets and Know How

As an innovation driven biotechnology company, we rely on trade secrets, technical know-how and continuing innovation to develop and maintain the competitive advantage relevant to our business. Under the agreements we enter into with our employees and consultants, full rights in any intellectual property are assigned to us. We also rely on confidentiality or other agreements with our employees, consultants, other advisors and business partners to protect our proprietary information. Our policy is to require third parties that receive material confidential information to enter into confidentiality or other agreements with us that contain appropriate protections for our confidential and trade secret information.

Government regulation

The FDA and other regulatory authorities at federal, state and local level, as well as in foreign countries and local jurisdictions, extensively regulate among other things, the research, development, testing, manufacture, quality control, sampling, import, export, safety, effectiveness, labeling, packaging, storage, distribution, record keeping, approval, advertising, promotion, marketing, post-approval monitoring and post-approval reporting of drugs. We, along with our vendors, contract research organizations, or CROs, and contract manufacturers, will be required to navigate the various preclinical, clinical, manufacturing and commercial approval requirements of the governing regulatory agencies of the countries in which we wish to conduct studies or seek approval of our product candidates. The process of obtaining regulatory approvals of drugs and ensuring subsequent compliance with appropriate federal, state, local and foreign statutes and regulations requires the expenditure of substantial time and financial resources.

In the U.S., the FDA regulates drug products under the Federal Food, Drug, and Cosmetic Act, or FD&C Act, as amended, its implementing regulations and other laws. If we fail to comply with applicable FDA or other requirements at any time with respect to product development, clinical testing, approval or any other legal requirements relating to product manufacture, processing, handling, storage, quality control, safety, marketing, advertising, promotion, packaging, labeling, export, import, distribution, or sale, we may become subject to administrative or judicial sanctions or other legal consequences. These sanctions or consequences could include, among other things, the FDA’s refusal to approve pending applications, issuance of clinical holds for ongoing studies, withdrawal of approvals, warning or untitled letters, product withdrawals or recalls, product seizures, relabeling or repackaging, total or partial suspensions of manufacturing or distribution, injunctions, fines, civil penalties or criminal prosecution.

The process required by the FDA before a drug may be marketed in the U.S. generally involves the following:

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completion of extensive preclinical studies in accordance with applicable regulations, including studies conducted in accordance with good laboratory practice, or GLP, requirements;

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submission to the FDA of an IND application, which must become effective before clinical trials may begin;

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approval by an IRB or independent ethics committee at each clinical trial site before each trial may be initiated;

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performance of adequate and well-controlled clinical trials in accordance with applicable IND regulations, GCP requirements and other clinical trial-related regulations, to establish the safety and efficacy of the investigational product for each proposed indication;

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submission to the FDA of a NDA;

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a determination by the FDA within 60 days of its receipt of a New Drug Application, or an NDA, to accept the filing for review;

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satisfactory completion of one or more FDA pre-approval inspections of the manufacturing facility or facilities where the drug will be produced to assess compliance with cGMP requirements to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity;

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potential FDA audit of the clinical trial sites that generated the data in support of the NDA;

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payment of user fees for FDA review of the NDA; and

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FDA review and approval of the NDA, including consideration of the views of any FDA advisory committee, prior to any commercial marketing or sale of the drug in the U.S.

Preclinical studies and clinical trials for drugs

Before testing any drug in humans, the product candidate must undergo rigorous preclinical testing. Preclinical studies include laboratory evaluations of drug chemistry, formulation and stability, as well as in vitro and animal studies to assess safety and in some cases to establish the rationale for therapeutic use. The conduct of preclinical studies is subject to federal and state regulations and requirements, including GLP requirements for safety/toxicology studies. The results of the preclinical studies, together with manufacturing information and analytical data must be submitted to the FDA as part of an IND. An IND is a request for authorization from the FDA to administer an investigational product to humans and must become effective before clinical trials may begin. Some long-term preclinical testing may continue after the IND is submitted. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day time period, raises concerns or questions about the conduct of the clinical trial, including concerns that human research patients will be exposed to unreasonable health risks, and imposes a clinical hold. In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. Submission of an IND may result in the FDA not allowing clinical trials to commence or not allowing clinical trials to commence on the terms originally specified in the IND.

The clinical stage of development involves the administration of the product candidate to healthy volunteers or patients under the supervision of qualified investigators, generally physicians not employed by or under the trial sponsor’s control, in accordance with GCP requirements, which include the requirements that all research subjects provide their informed consent for their participation in any clinical trial. Clinical trials are conducted under protocols detailing, among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria and the parameters and criteria to be used in monitoring safety and evaluating effectiveness. Each protocol, and any subsequent amendments to the protocol must be submitted to the FDA as part of the IND. Furthermore, each clinical trial must be reviewed and approved by an IRB for each institution at which the clinical trial will be conducted to ensure that the risks to individuals participating in the clinical trials are minimized and are reasonable related to the anticipated benefits. The IRB also approves the informed consent form that must be provided to each clinical trial subject or his or her legal representative, and must monitor the clinical trial until completed. The FDA, the IRB or the sponsor may suspend or discontinue a clinical trial at any time on various grounds, including a finding that the patients are being exposed to an unacceptable health risk or that the trial is unlikely to meet its stated objectives. Some studies also include oversight by an independent group of qualified experts organized by the clinical study sponsor, known as a data safety monitoring board, which provides authorization for whether or not a study may move forward at designated check points based on access to certain data from the study and may halt the clinical trial if it determines that there is an unacceptable safety risk for subjects or other grounds, such as no demonstration of efficacy. There also are requirements governing the reporting of ongoing clinical trials and completed clinical trials to public registries. Information about applicable clinical trials, including clinical trial results, must be submitted within specific timeframes for publication on the www.clinicaltrials.gov website.

A sponsor who wishes to conduct a clinical trial outside of the U.S. may, but need not, obtain FDA authorization to conduct the clinical trial under an IND. If a foreign clinical trial is not conducted under an IND, the sponsor must submit data from the clinical trial to the FDA in support of an NDA. The FDA will accept a well-designed and well-conducted foreign clinical trial not conducted under an IND if the trial was conducted in accordance with GCP requirements, and the FDA is able to validate the data through an onsite inspection if deemed necessary.

Clinical trials to evaluate therapeutic indications to support NDAs for marketing approval are typically conducted in three sequential phases, which may overlap or be combined.

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Phase 1—Phase 1 clinical trials involve initial introduction of the investigational product into healthy human volunteers or patients with the target disease or condition. These studies are typically designed to test the safety, dosage tolerance, absorption, metabolism and distribution of the investigational product in humans, excretion the side effects associated with increasing doses, and, if possible, to gain early evidence of effectiveness. In the case of some products for severe or life-threatening diseases, such as cancer, especially when the product may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients.

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Phase 2—Phase 2 clinical trials typically involve administration of the investigational product to a limited patient population with a specified disease or condition to evaluate the preliminary efficacy, optimal dosages and dosing schedule and to identify possible adverse side effects and safety risks.

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Phase 3—Phase 3 clinical trials typically involve administration of the investigational product to an expanded patient population to further evaluate dosage, to provide statistically significant evidence of clinical efficacy and to further test for safety, generally at multiple geographically dispersed clinical trial sites. These clinical trials are intended to establish the overall risk/benefit ratio of the investigational product and to provide an adequate basis for product approval and physician labeling. Generally, two adequate and well-controlled Phase 3 clinical trials are required by the FDA for approval of an NDA.

Post-approval trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval. These trials are used to gain additional experience from the treatment of patients in the intended therapeutic indication and are commonly intended to generate additional safety data regarding use of the product in a clinical setting. In certain instances, the FDA may mandate the performance of Phase 4 clinical trials as a condition of approval of an NDA.

Progress reports detailing the results of the clinical trials, among other information, must be submitted at least annually to the FDA. Written IND safety reports must be submitted to the FDA and the investigators fifteen days after the trial sponsor determines the information qualifies for reporting for serious and unexpected suspected adverse events, findings from other studies or animal or in vitro testing that suggest a significant risk for human volunteers and any clinically important increase in the rate of a serious suspected adverse reaction over that listed in the protocol or investigator brochure. The sponsor must also notify the FDA of any unexpected fatal or life-threatening suspected adverse reaction as soon as possible but in no case later than seven calendar days after the sponsor’s initial receipt of the information.

Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the product candidate and finalize a process for manufacturing the drug product in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the product candidate and manufacturers must develop, among other things, methods for testing the identity, strength, quality and purity of the final drug product. Additionally, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life.

U.S. marketing approval for drugs

Assuming successful completion of the required clinical testing, the results of the preclinical studies and clinical trials, together with detailed information relating to the product’s chemistry, manufacture, controls and proposed labeling, among other things are submitted to the FDA as part of an NDA requesting approval to market the product for one or more indications. An NDA must contain proof of the drug’s safety and efficacy in order to be approved. The marketing application may include both negative and ambiguous results of preclinical studies and clinical trials, as well as positive findings. Data may come from company-sponsored clinical trials intended to test the safety and efficacy of a product’s use or from a number of alternative sources, including studies initiated by investigators. To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the safety and efficacy of the investigational product to the satisfaction of the FDA. FDA approval of an NDA must be obtained before a drug may be marketed in the U.S.

The FDA reviews all submitted NDAs before it accepts them for filing and may request additional information rather than accepting the NDA for filing. The FDA must make a decision on accepting an NDA for filing within 60 days of receipt, and such decision could include a refusal to file by the FDA. Once the submission is accepted for filing, the FDA begins an in-depth substantive review of the NDA. The FDA reviews an NDA to determine, among other things, whether the drug is safe and effective and whether the facility in which it is manufactured, processed, packaged or held meets standards designed to assure the product’s continued safety, quality and

purity. Under the goals and polices agreed to by the FDA under the Prescription Drug User Fee Act, or PDUFA, the FDA targets ten months, from the filing date, in which to complete its initial review of a new molecular entity NDA and respond to the applicant, and six months from the filing date of a new molecular entity NDA for priority review. The FDA does not always meet its PDUFA goal dates for standard or priority NDAs, and the review process is often extended by FDA requests for additional information or clarification.

Further, under PDUFA, as amended, each NDA must be accompanied by a user fee. The FDA adjusts the PDUFA user fees on an annual basis. Fee waivers or reductions are available in certain circumstances, including a waiver of the application fee for the first application filed by a small business. Additionally, no user fees are assessed on NDAs for products designated as orphan drugs, unless the product also includes a non-orphan indication.

The FDA also may require submission of a Risk Evaluation and Mitigation Strategy, or REMS, program to ensure that the benefits of the drug outweigh its risks. The REMS program could include medication guides, physician communication plans, assessment plans and/or elements to assure safe use, such as restricted distribution methods, patient registries or other risk-minimization tools.

The FDA may refer an application for a novel drug to an advisory committee. An advisory committee is a panel of independent experts, including clinicians and other scientific experts, which reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.

Before approving an NDA, the FDA typically will inspect the facility or facilities where the product is manufactured. The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. Additionally, before approving an NDA, the FDA may inspect one or more clinical trial sites to assure compliance with GCP and other requirements and the integrity of the clinical data submitted to the FDA.

After evaluating the NDA and all related information, including the advisory committee recommendation, if any, and inspection reports regarding the manufacturing facilities and clinical trial sites, the FDA may issue an approval letter, or, in some cases, a complete response letter. A complete response letter generally contains a statement of specific conditions that must be met in order to secure final approval of the NDA and may require additional clinical or preclinical testing in order for the FDA to reconsider the application. Even with submission of this additional information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval. If and when those conditions have been met to the FDA’s satisfaction, the FDA will typically issue an approval letter. An approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications.

Even if the FDA approves a product, depending on the specific risk(s) to be addressed it may limit the approved indications for use of the product, require that contraindications, warnings or precautions be included in the product labeling, require that post-approval studies, including Phase 4 clinical trials, be conducted to further assess a drug’s safety after approval, require testing and surveillance programs to monitor the product after commercialization or impose other conditions, including distribution and use restrictions or other risk management mechanisms under a REMS, which can materially affect the potential market and profitability of the product. The FDA may prevent or limit further marketing of a product based on the results of post-marketing studies or surveillance programs. After approval, some types of changes to the approved product, such as adding new indications, manufacturing changes and additional labeling claims, are subject to further testing requirements and FDA review and approval.

Orphan drug designation and exclusivity

Under the Orphan Drug Act, the FDA may grant orphan designation to a drug intended to treat a rare disease or condition, which is a disease or condition that affects fewer than 200,000 individuals in the U.S., or if it affects 200,000 or more individuals in the U.S., there is no reasonable expectation that the cost of developing and making the product available in the U.S. for the disease or condition will be recovered from sales of the product. Orphan designation must be requested before submitting an NDA. After the FDA grants orphan designation, the identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA. Orphan designation does not convey any advantage in or shorten the duration of the regulatory review and approval process, though companies developing orphan products are eligible for certain incentives, including tax credits for qualified clinical testing and waiver of application fees.

If a product that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to a seven-year period of marketing exclusivity during which the FDA may not approve any other applications to market the same therapeutic agent for the same indication, except in limited circumstances, such as a subsequent product’s showing of clinical superiority over the product with orphan exclusivity or where the original applicant cannot produce sufficient quantities of product. Competitors, however, may receive approval of different therapeutic agents for the indication for which the orphan product has exclusivity or obtain approval for the same therapeutic agent but for a different indication than that for which the orphan product has exclusivity. Orphan product exclusivity could also block the approval of one of our products for seven years if a competitor obtains approval for the same therapeutic agent for the same indication before we do, unless we are able to demonstrate that our product is clinically superior. If an orphan designated product receives marketing approval for an indication broader than what is designated, it may not be entitled to orphan exclusivity. Further, orphan drug exclusive marketing rights in the U.S. may be lost if the FDA later determines that the request for designation was materially defective or the manufacturer of the approved product is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition.

Expedited development and review programs for drugs

The FDA maintains several programs intended to facilitate and expedite development and review of new drugs to address unmet medical needs in the treatment of serious or life-threatening diseases or conditions. These programs include Fast Track designation, Breakthrough Therapy designation, Priority Review and Accelerated Approval, and the purpose of these programs is to either expedite the development or review of important new drugs to get them to patients earlier than under standard FDA development and review procedures.

A new drug is eligible for Fast Track designation if it is intended to treat a serious or life-threatening disease or condition and demonstrates the potential to address unmet medical needs for such disease or condition. Fast Track designation provides increased opportunities for sponsor interactions with the FDA during preclinical and clinical development, in addition to the potential for rolling review once a marketing application is filed, meaning that the agency may review portions of the marketing application before the sponsor submits the complete application, as well as Priority Review, discussed below.

In addition, a new drug may be eligible for Breakthrough Therapy designation if it is intended to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. Breakthrough Therapy designation provides all the features of Fast Track designation in addition to intensive guidance on an efficient drug development program beginning as early as Phase 1, and FDA organizational commitment to expedited development, including involvement of senior managers and experienced review staff in a cross-disciplinary review, where appropriate.

Any product submitted to the FDA for approval, including a product with Fast Track or Breakthrough Therapy designation, may also be eligible for additional FDA programs intended to expedite the review and approval process including Priority Review designation and Accelerated Approval. A product is eligible for Priority Review if it has the potential to provide a significant improvement in safety or effectiveness in the treatment, diagnosis or prevention of a serious disease or condition. Under priority review, the FDA targets reviewing an application in six months after filing compared to ten months after filing for a standard review.

Additionally, products are eligible for Accelerated Approval if they can be shown to have an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or an effect on a clinical endpoint that can be measured earlier than an effect on irreversible morbidity or mortality which is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity or prevalence of the condition and the availability or lack of alternative treatments. Accelerated Approval is usually contingent on a sponsor’s agreement to conduct additional post-approval studies to verify and describe the product’s clinical benefit and, under the Food and Drug Omnibus Reform Act of 2022, or FDORA, the FDA is now permitted to require, as appropriate, that such trials be underway prior to approval or within a specific time period after the date of approval for a product granted Accelerated Approval. Under FDORA, the FDA has increased authority for expedited procedures to withdraw approval of a drug or indication approved under Accelerated Approval if, for example, the confirmatory trial fails to verify the predicted clinical benefit of the product. In addition, unless otherwise informed by the FDA, the FDA generally requires, unless otherwise informed by the agency, that all advertising and promotional materials that are intended for dissemination or publication within 120 days following marketing approval be submitted to the agency for review during the pre-approval review period, and that after

120 days following marketing approval, all advertising and promotional materials must be submitted at least 30 days prior to the intended time of initial dissemination or publication.

Even if a product qualifies for one or more of these programs, the FDA may later decide that the product no longer meets the conditions for qualification or the time period for FDA review or approval may not be shortened. Furthermore, Fast Track designation, Breakthrough Therapy designation, Priority Review and Accelerated Approval do not change the scientific or medical standards for approval or the quality of evidence necessary to support approval but may expedite the development or review process.

Pediatric information and pediatric exclusivity

Under the Pediatric Research Equity Act, or PREA, as amended, certain NDAs and certain supplements to an NDA must contain data to assess the safety and efficacy of the drug for the claimed indications in all relevant pediatric subpopulations and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective. The FDA may grant deferrals for submission of pediatric data or full or partial waivers. The FD&C Act requires that a sponsor who is planning to submit a marketing application for a drug that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration submit an initial Pediatric Study Plan, or PSP, within 60 days of an end-of-Phase 2 meeting or, if there is no such meeting, as early as practicable before the initiation of the Phase 3 or Phase 2/3 trial. The FDA and the sponsor must reach an agreement on the PSP. A sponsor can submit amendments to an agreed-upon initial PSP at any time if changes to the pediatric plan need to be considered based on data collected from preclinical studies, early phase clinical trials and/or other clinical development programs.

A drug can also obtain pediatric market exclusivity in the U.S. Pediatric exclusivity, if granted, adds six months to existing exclusivity periods and patent terms. This six-month exclusivity, which runs from the end of other exclusivity protection or patent term, may be granted based on the voluntary completion of a pediatric trial or of multiple pediatric trials in accordance with an FDA-issued “Written Request” for such trials.

U.S. post-approval requirements for drugs

Drugs manufactured or distributed pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to recordkeeping, periodic reporting, product sampling and distribution, reporting of adverse experiences with the product, complying with promotion and advertising requirements, which include restrictions on promoting products for unapproved uses or patient populations (known as “off-label use”) and limitations on industry-sponsored scientific and educational activities. Although physicians may prescribe legally available products for off-label uses, manufacturers and individuals working on behalf of manufacturers may not market or promote such uses. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability, including investigation by federal and state authorities. Prescription drug promotional materials must be submitted to the FDA in conjunction with their first use or first publication. Further, if there are any modifications to the drug, including changes in indications, labeling or manufacturing processes or facilities, the applicant may be required to submit and obtain FDA approval of a new NDA or NDA supplement, which may require the development of additional data or preclinical studies and clinical trials. The FDA may impose a number of post-approval requirements as a condition of approval of an NDA. For example, the FDA may require post-market testing, including Phase 4 clinical trials, and surveillance to further assess and monitor the product’s safety and effectiveness after commercialization.

In addition, drug manufacturers and their subcontractors involved in the manufacture and distribution of approved drugs, and those supplying products, ingredients, and components of them, are required to register their establishments with the FDA and certain state agencies and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with ongoing regulatory requirements, including cGMP, which impose certain procedural and documentation requirements upon us and our contract manufacturers. Failure to comply with statutory and regulatory requirements can subject a manufacturer to possible legal or regulatory action, such as warning letters, suspension of manufacturing, product seizures, injunctions, civil penalties or criminal prosecution. There is also a continuing, annual prescription drug product program user fee.

Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information, requirements for post-market studies or

clinical trials to assess new safety risks, or imposition of distribution or other restrictions under a REMS. Other potential consequences include, among other things:

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restrictions on the marketing or manufacturing of the product, complete withdrawal of the product from the market or product recalls;

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safety alerts, Dear Healthcare Provider letters, press releases or other communications containing warnings or other safety information about the product;

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fines, warning letters or untitled letters or holds on post-approval clinical trials;

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refusal of the FDA to approve applications or supplements to approved applications, or suspension or revocation of product approvals;

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product seizure or detention, or refusal to permit the import or export of products;

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injunctions or the imposition of civil or criminal penalties; and

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consent decrees, corporate integrity agreements, debarment or exclusion from federal healthcare programs or mandated modification of promotional materials and labeling and issuance of corrective information.

Marketing exclusivity

Market exclusivity provisions under the FD&C Act can delay the submission or the approval of certain marketing applications. The FD&C Act provides a five-year period of non-patent exclusivity within the United States to the first applicant to obtain approval of an NDA for a new chemical entity. A drug is a new chemical entity if the FDA has not previously approved any other new drug containing the same active moiety, which is the molecule or ion responsible for the action of the drug substance. During the exclusivity period, the FDA may not approve or even accept for review an abbreviated new drug application, or ANDA, or an NDA submitted under Section 505(b)(2), or 505(b)(2) NDA, submitted by another company for another drug based on the same active moiety, regardless of whether the drug is intended for the same indication as the original innovative drug or for another indication. However, such an application may be submitted after four years if it contains a certification of patent invalidity or non-infringement to one of the patents listed with the FDA by the innovator NDA holder.

The FD&C Act alternatively provides three years of marketing exclusivity for an NDA, or supplement to an existing NDA, if new clinical investigations, other than bioavailability studies, that were conducted or sponsored by the applicant are deemed by the FDA to be essential to the approval of the application, for example new indications, dosages or strengths of an existing drug. This three-year exclusivity covers only the modification for which the drug received approval on the basis of the new clinical investigations and does not prohibit the FDA from approving ANDAs or 505(b)(2) NDAs for drugs containing the active agent for the original indication or condition of use. Five-year and three-year exclusivity will not delay the submission or approval of a full NDA. However, an applicant submitting a full NDA would be required to conduct or obtain a right of reference to any preclinical studies and adequate and well-controlled clinical trials necessary to demonstrate safety and effectiveness.

Other regulatory matters

Manufacturing, sales, promotion and other activities of product candidates following product approval, where applicable, or commercialization are also subject to regulation by numerous regulatory authorities in the U.S. in addition to the FDA, which may include the Centers for Medicare & Medicaid Services, or CMS, other divisions of the Department of Health and Human Services, the Department of Justice, the Drug Enforcement Administration, the Consumer Product Safety Commission, the Federal Trade Commission, the Occupational Safety & Health Administration, the Environmental Protection Agency and state and local governments and governmental agencies.

Current and future healthcare reform legislation

In the United States and in some foreign jurisdictions, there have been, and likely will continue to be, a number of legislative and regulatory changes and proposed changes intended to broaden access to healthcare, improve the quality of healthcare, and contain or lower the cost of healthcare. For example, in the United States, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or ACA, among other things, subjected products to potential competition by lower-cost products, expanded the types of entities eligible for the 340B drug discount program, addressed a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, increases rebates owed by manufacturers under the Medicaid Drug Rebate Program and extended the rebate program to individuals enrolled in Medicaid managed care organizations,

established annual fees and taxes on manufacturers of certain branded prescription drugs, and created a Medicare Part D coverage gap discount program for certain Medicare Part D beneficiaries, in which manufacturers must agree to offer 50% (increased to 70% pursuant to the Bipartisan Budget Act of 2018, or BBA, effective as of January 2019) point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D.

There have been executive, judicial and congressional challenges to certain aspects of the ACA Act as well as efforts to repeal or replace certain aspects of the ACA. On June 17, 2021, the U.S. Supreme Court dismissed the most recent judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA. Prior to the Supreme Court’s decision, President Biden issued an executive order to initiate a special enrollment period from February 15, 2021, through August 15, 2021, for purposes of obtaining health insurance coverage through the ACA marketplace. The executive order also instructed certain governmental agencies to review and reconsider their existing policies and rules that limit access to healthcare, including among others, reexamining Medicaid demonstration projects and waiver programs that include work requirements, and policies that create unnecessary barriers to obtaining access to health insurance coverage through Medicaid or the ACA.

Other federal health reform measures have been proposed and adopted in the U.S. since the ACA was enacted. By way of example, the Budget Control Act of 2011, among other things, included aggregate reductions to Medicare payments to providers of up to 2% per fiscal year. This reduction went into effect in April 2013 and, due to subsequent legislative amendments, will remain in effect through 2030, with the exception of a temporary suspension from May 1, 2020, through March 31, 2022. Then, a 1% payment reduction will occur beginning April 1, 2022, through June 30, 2022, and the 2% payment reduction will resume on July 1, 2022. CMS has indicated that it is delaying the processing of claims in April to allow Congress to pass legislation that would extend the suspension. In addition, the American Taxpayer Relief Act of 2012 was signed into law which, among other things, reduced Medicare payments to several providers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

Furthermore, there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several congressional inquiries and proposed legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient assistance programs and reform government program reimbursement methodologies for drug products. At the federal level, the previous administration used several means to propose or implement drug pricing reform, including through federal budget proposals, executive orders and policy initiatives. On July 9, 2021, President Biden issued an executive order directing the FDA to, among other things, continue to clarify and improve the approval framework for generic drugs and identify and address any efforts to impede generic drug competition.

On August 16, 2022, the Inflation Reduction Act of 2022, or the IRA, was passed, which among other things, allows for Centers for Medicare & Medicaid Services to negotiate prices for certain single-source drugs and biologics reimbursed under Medicare Part B and Part D, beginning with select high-cost drugs in 2026. The legislation subjects drug manufacturers to civil monetary penalties and a potential excise tax for offering a price that is not equal to or less than the price negotiated under the law or for taking price increases that exceed inflation. The legislation also requires manufacturers to pay rebates for drugs in Medicare Part D whose price increases exceed inflation. Further, the legislation caps Medicare beneficiaries’ annual out-of-pocket drug expenses at $2,000. The effect of IRA on our business and the healthcare industry in general is not yet known.

Individual states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs. It is difficult to predict the future legislative landscape in healthcare and the effect on our business, results of operations, financial condition and prospects. However, we expect that additional state and federal healthcare reform measures will be adopted in the future. Further, it is possible that additional governmental action is taken in response to the COVID-19 pandemic.

Third-party payor coverage and reimbursement

Significant uncertainty exists as to the coverage and reimbursement status of any products for which we may obtain regulatory approval. In the U.S. and markets in other countries, sales of any products for which we may receive regulatory marketing approval for commercial sale will depend, in part, on the availability of coverage and reimbursement from third-party payors. Third-party payors include government healthcare programs (e.g., Medicare, Medicaid), managed care providers, private health insurers, health maintenance organizations and other organizations. These third-party payors decide which medications they will pay for and will establish reimbursement levels. The availability of coverage and extent of reimbursement by governmental and other third-party payors is essential for most patients to be able to afford treatments such as targeted protein degradation therapies.

GLUE US Equity

GLUE · 10-K · period ended 2022-12-31

Item 1. Business

GLUE US Equity☆

GLUE · 10-K · period ended 2022-12-31

Item 1. Business

GLUE US Equity