selb-20221231

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

For the fiscal year ended December 31, 2022

For the transition period from ____ to ____

Commission file number: 001-37798

Selecta Biosciences, Inc.

(Exact name of registrant as specified in its charter)

65 Grove Street, Watertown, MA 02472

(Address of principal executive offices) (Zip Code)

(617) 923-1400

Registrant’s telephone number, including area code

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

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

Common Stock, $0.0001 par value per share SELB The Nasdaq Stock Market LLC

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 o Noý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o Noý

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 o

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 and post such files). Yes☒ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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 attested 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. o

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. o

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). o

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 common stock held by non-affiliates of the registrant based on the closing price of the registrant’s common stock as reported on the Nasdaq Stock Market on June 30, 2022, the last business day of the registrant’s most recently completed second quarter, was $149,708,988.

As of February 24, 2023 the registrant had 153,318,915 shares of common stock, par value $0.0001 per share, outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s definitive Proxy Statement relating to its 2022 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission are incorporated by reference into Part III of this Annual Report on Form 10-K.

TABLE OF CONTENTS

Part I

Page

Item 1. Business 5

Item 1A. Risk Factors 31

Item 1B. Unresolved Staff Comments 58

Item 2. Properties 58

Item 3. Legal Proceedings 58

Item 4. Mine Safety Disclosures 59

Part II

Item 6. [Reserved] 61

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 71

Item 8. Financial Statements and Supplementary Data 71

Item 9A. Controls and Procedures 72

Item 9B. Other Information 72

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 72

Part III

Item 10. Directors, Executive Officers and Corporate Governance 73

Item 11. Executive Compensation 73

Item 14. Principal Accountant Fees and Services 73

Part IV

Item 15. Exhibits and Financial Statement Schedules 74

Signatures 78

FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K, or the Annual Report, contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, 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, including statements regarding our future results of operations and financial position, business strategy, prospective products, product approvals, research and development costs, timing and likelihood of success, the plans and objectives of management for future operations and future results of anticipated products,the impact of the COVID-19 pandemic on our business and operations and our future financial results, and the period over which we estimate our existing cash and cash equivalents will be sufficient to fund our future operating expenses and capital expenditure requirements are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important 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 the forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential”, or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this Annual Report are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this Annual Report and are subject to a number of important factors that could cause actual results to differ materially from those in the forward-looking statements, including the factors described under the sections in this Annual Report titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as the following:

•our status as a development-stage company and our expectation to incur losses in the future;

•our future capital needs and our need to raise additional funds;

•our ability to build a pipeline of product candidates and develop and commercialize such pipeline;

•our unproven approach to therapeutic intervention;

•our ability to enroll patients in clinical trials, timely and successfully complete those trials and receive necessary regulatory approvals;

•our ability to access manufacturing facilities and to receive or manufacture sufficient quantities of our product candidates;

•our ability to maintain our existing or future collaborations or licenses;

•the continuing impact of the COVID-19 pandemic on our operations, the continuity of our business, including our preclinical studies and clinical trials, and general economic conditions;

•our ability to protect and enforce our intellectual property rights;

•federal, state, and foreign regulatory requirements, including FDA regulation of our product candidates;

•our ability to obtain and retain key executives and attract and retain qualified personnel;

•developments relating to our competitors and our industry, including the impact of government regulation; and

•our ability to successfully manage our growth.

Moreover, we operate in an evolving environment. New risks and uncertainties may emerge from time to time, and it is not possible for management to predict all risk and uncertainties.

You should read this Annual Report and the documents that we reference in this Annual Report completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.

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PART I

Item 1. Business

Overview

We are a clinical-stage biotechnology company leveraging our ImmTOR® platform to develop tolerogenic therapies designed to selectively mitigate unwanted immune responses. With a proven ability to induce tolerance to highly immunogenic proteins, ImmTOR has the potential to amplify the efficacy of biologic therapies, including redosing of life-saving gene therapies, as well as restore the body's natural self-tolerance in autoimmune diseases. We have several proprietary and partnered programs in our pipeline focused on enzyme therapies, gene therapies, and autoimmune diseases.

In preclinical studies, we have observed that ImmTOR may have synergistic activity with interleukin-2, or IL-2, molecules that have been engineered to be selective for regulatory T cells, or Tregs. Treg-selective IL-2 molecules have been shown to transiently expand all pre-existing Tregs in preclinical and clinical studies conducted by others. We have observed in preclinical studies that the combination of ImmTOR, a Treg-selective IL-2 molecule and an antigen exhibited substantial synergistic activity in inducing and expanding antigen-specific Tregs beyond ImmTOR alone with evidence of enhanced durability of immune tolerance and the potential for ImmTOR dose sparing. This combination of ImmTOR with a Treg selective IL-2 molecule represents an evolution of the ImmTOR platform, which we call ImmTOR-ILTM. We believe this combination has the potential to be a "first-in-class" antigen specific IL-2 therapy for autoimmune disease.

We believe ImmTOR and ImmTOR-IL have the potential to enable novel therapeutic modalities in autoimmune disease as well as enhance both the efficacy and safety of biologic therapies (including gene therapies) and improve product candidates under development. In clinical trials, ImmTOR has been observed to inhibit the formation of neutralizing antibodies to adeno-associated virus (AAV) capsids, potentially enabling re-dosing of gene therapies. Additionally, based on preclinical data in AAV gene therapies, we believe that ImmTOR has the potential to improve efficacy and safety by increasing transgene expression, reducing hepatic inflammation and inhibiting undesired immune responses to both the AAV capsid and the transgene product that can occur with the first dose of gene therapy.

In biologic therapies, clinical activity of ImmTOR in humans has been observed with pegadricase, a highly immunogenic pegylated uricase enzyme being developed for the treatment of patients with chronic refractory gout. The combination of ImmTOR and pegadricase is currently being evaluated in a Phase 3 clinical trial that we are conducting on behalf of our partner Swedish Orphan Biovitrum AB, or Sobi.

We intend to pursue development of therapies for autoimmune diseases where expansion of either all Tregs or antigen-specific Tregs has been shown to, or we believe is, likely to have a beneficial effect. We believe that ImmTOR and ImmTOR-IL have the potential to unlock antigen-specific therapies for autoimmune diseases and that ImmTOR-IL can further improve the efficacy and safety profile of biologic therapies beyond ImmTOR alone.

We have developed a portfolio of wholly owned and partnered candidates across gene therapies, biologic therapies and tolerogenic therapies for autoimmune diseases that leverage our ImmTOR platform. We plan to continue to develop proprietary compounds and pursue collaboration-driven development in certain disease areas, which could include strategic collaborations, out-licensing, and in-licensing transactions.

Our ImmTOR Platform

ImmTOR consists of biodegradable nanoparticles encapsulating the immunomodulator rapamycin. Rapamycin is the active ingredient of Rapamune, an immunosuppressant that has been used extensively in humans and is currently FDA-approved as a prophylaxis of organ rejection in kidney transplant patients aged 13 or older. The rapamycin component of ImmTOR is embedded in a matrix of synthetic polymers called poly(D,L-lactide), or PLA, and poly(D,L-lactide)-block-poly(ethylene-glycol), or PLA-PEG. PLA is part of the broader poly(lactic-co-glycolic acid), or PLGA, family of biodegradable polymers that have more than 30 years of commercial use and are formulation components in a number of approved products. Polyethylene glycol, or PEG, has been widely studied in clinical trials and is also a formulation component in many approved biologic products.

Our nanoparticles are designed to remain intact after injection into the body and accumulate predominantly in lymph nodes, the spleen, and the liver, where immune responses are coordinated. The nanoparticles are designed to be processed by specialized immune cells, such as dendritic cells and other antigen-presenting cells, that initiate and regulate immune responses. ImmTOR is intended to induce a tolerogenic phenotype in these antigen-presenting cells, which then process and present co-administered antigens in a manner that results in the induction of antigen-specific regulatory T cells. To mitigate unwanted immune responses by inducing precision immune tolerance in the body, we administer our ImmTOR with the desired antigen, such as an auto-antigen in the case of an autoimmune disease, a viral vector in the case of our gene therapy program, or a therapeutic enzyme, as depicted in the figure below.

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In the case of a biologic drug, ImmTOR is designed to be administered in conjunction with such biologic drugs to mitigate the formation of ADAs without requiring the alteration of the drug or its dose regimen. As a result, we believe ImmTOR may provide us with significant opportunities to co-administer ImmTOR with a variety of biologic drugs, including therapeutic enzymes and gene therapies. We believe each pairing of ImmTOR with a biologic drug also offers us the opportunity to pursue distinct proprietary product candidates, which we believe have the potential to be separately patented, approved and marketed. ImmTOR is manufactured in facilities subject to current good manufacturing practice, or cGMP, requirements using well-defined commercial operations, which, we believe, further enhances the scalability of our tolerance programs.

In preclinical studies, we observed that delivering an antigen together with ImmTOR provided the appropriate signals in vivo to induce regulatory T cells, which, in turn, inhibited effector immune responses, such as the formation of ADAs. In additional preclinical studies, we observed that ImmTOR labeled with a fluorescent dye selectively accumulated in the spleen and the liver following intravenous dosing, where it was processed by antigen-presenting cells, such as dendritic cells. The figure below depicts a model of how we believe ImmTOR would be taken up by a dendritic cell in the spleen. We believe that both the biologic drug and ImmTOR are taken up and processed by dendritic cells and other antigen presenting cells in a manner that may result in the activation of antigen-specific regulatory T cells, which can potentially block the activation of helper T cells, thus mitigating the formation of ADAs.

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ImmTOR-IL

We look for ways to enhance our ImmTOR platform. Recent preclinical data generated by our scientific teams suggest that ImmTOR may have profound synergistic activity with engineered IL-2 molecules that are selective for Tregs. The IL-2 pathway influences critical aspects of both immune stimulation and immune regulation. Tregs express a high affinity form of the IL-2 receptor. Low doses of IL-2 have been shown by others to selectively activate Tregs resulting in expansion of pre-existing Tregs. Clinical trials of low dose IL-2 have generated evidence of efficacy in autoimmune diseases. Other investigators have shown that IL-2 can be engineered to selectively bind to the high affinity IL-2 receptor and expand pre-existing Tregs.

In our preclinical studies, we observed that ImmTOR combined with a Treg-selective IL-2 mutant protein, or IL-2 mutein, exhibited substantial synergistic activity in increasing the percentage and durability of total Treg expansion in the spleen. We believe that this combination has the potential to be a best-in-class therapy in diseases where expansion of total Treg may prove beneficial. The tables below show the synergistic expansion of total Treg we observed with treatment with ImmTOR and a Treg-selective IL-2 mutein. In the study, seven C57BL/6 mice per group were untreated, treated with ImmTOR alone, treated with IL-2 mutein alone or treated with a combination of ImmTOR and IL-2 mutein. Expansion of CD4+, CD25+ and FoxP3+ T regulatory cells in the spleen was assessed at four, seven and 14 days after treatment.

We believe that the power of ImmTOR is the ability to induce antigen-specific Treg to co-administered antigens. The ability to induce antigen-specific Treg may be beneficial in autoimmune diseases where the auto-antigens are well characterized. We believe the combination of a Treg-selective IL-2 with ImmTOR and an antigen has the potential to induce and/or expand antigen specific Treg. The image below illustrates the possibility that the combination of a Treg-selective IL-2 with ImmTOR plus an antigen could give rise to the induction and/or expansion of an antigen-specific Treg.

In a preclinical study, we evaluated the potential of a Treg-selective IL-2 to further expand antigen-specific Treg when combined with ImmTOR and an antigen. In this preclinical study, transgenic T cells expressing a T cell receptor specific for the antigen ovalbumin were adoptively transferred into wildtype mice. The next day, the mice were treated, left untreated or treated with ovalbumin or various combinations of ovalbumin with ImmTOR and/or IL-2 mutein. When total Treg were evaluated, we observed no increase an expansion of total Treg by IL-2 mutein + ovalbumin with a further increase in animals treated with ovalbumin + IL-2 mutein + ImmTOR. As we had expected, ImmTOR + ovalbumin alone did not increase total Treg. However, when ovalbumin-specific Treg were evaluated, we observed a significant increase in antigen-specific Treg in animals treated with the combination of ovalbumin + ImmTOR + IL-2 mutein. Animals treated with only ImmTOR + ovalbumin also were observed to have an increase in ovalbumin-specific Tregs but at levels that were approximately three-fold lower than those in the former group. The following graphs show expansion of antigen-specific Treg in mice treated with ImmTOR plus IL-2 mutein plus ovalbumin antigen.

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Immune homeostasis is a dynamic process balancing immune stimulatory and immune tolerizing signals. This balance is thought to be mediated in part by the ratio of antigen-specific Treg to antigen-specific effector T cells. The expansion of antigen-specific Tregs has the potential to better withstand potent immune stimulatory signals and provide better durability of immune tolerance. In a preclinical study, we evaluated the ability of ImmTOR and IL-2 mutein to mitigate the immunogenicity to a co-administered AAV vector. Mice were injected with a dose of 2.7E12 vg/kg AAV8 on Day 0 and 5.0E12 vg/kg on Day 56 with or without IL-2 mutein and/or ImmTOR on the same days. Mice treated with AAV alone showed a robust antibody response to the AAV capsid, as we had expected. Co-treatment with IL-2 mutein on Days 0 and 56 showed a modest attenuation of the antibody response. Co-treatment with ImmTOR on Days 0 and 56 showed a dose-responsive effect on the antibody response, with a therapeutic dose of 200 μg ImmTOR providing inhibition of antibodies against AAV through at least Day 75, or 19 days after the second dose. At Day 91, some animals showed breakthrough of the antibody response. ImmTOR doses of 50 and 100 μg alone were sub-optimal. However, when ImmTOR was combined with IL-2 mutein, we observed inhibition of antibody formation through Day 117, 61 days after the second dose and the last time point measured. Importantly full inhibition of anti-AAV immunoglobulin G, or IgG, antibodies was observed even when IL-2 mutein was combined with 50 and 100 μg doses of ImmTOR. We believe these results suggest that the addition of a Treg-selective IL-2 to ImmTOR has the potential to increase the durability of tolerance allow for dose-sparing of ImmTOR and thus, potentially enabling chronic dosing of ImmTOR-IL in the treatment of autoimmune disease. The following graphs illustrate that the combination of ImmTOR and IL-2 mutein mitigated the formation of anti-AAV antibodies in response to a high vector dose of 5E13 vg/kg. These results suggest that ImmTOR-IL has the potential to enable repeat dosing of AAV vectors at 5E13 vg/kg which could be used as a strategy to avoid the toxicities that have been observed at doses of 1E14 vg/kg or higher in some clinical trials.

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Product Candidates

Our ImmTOR platform has a broad range of potential applications. Our product development strategy is built on the following three distinct pillars.

Biologic therapies. Biologic therapies are a class of biologic drugs frequently used to treat rare diseases. Through our analysis of biologic drugs, including in our preclinical studies, we have observed that enzymes foreign to the human body, such as enzymes derived from microbes or replacement enzymes in the case of patients that are deficient in the specific enzyme, are especially prone to causing undesired immune responses. Our partnered product candidate, SEL-212, which is currently in Phase 3 clinical development, consists of ImmTOR co-administered with pegadricase, a pegylated uricase enzyme of fungal origin. This is an example of an immunogenic enzyme that we are combining with ImmTOR with the intention of improving the enzyme’s efficacy and safety. We believe that ImmTOR has the potential to enable and expand the use of enzymes derived from microbial sources, such as bacterial immunoglobulin A, or IgA, protease for the treatment of IgA nephropathy. We selected a next generation IgA protease candidate from a commensal bacteria with a lower level of baseline ADAs from IGAN Biosciences for the treatment of IgA nephropathy. By combining ImmTOR with this next generation IgA protease candidate, we believe our novel approach has the potential to mitigate the formation of new ADAs and address the underlying pathophysiology of the disease.

Additionally, we believe advances in protein engineering may lead to innovative therapeutic enzymes with improved pharmaceutical properties or entirely novel specificity and/or activity, but which may be recognized as foreign by the immune system. We are partnering with Ginkgo Bioworks, or Ginkgo, to design novel enzymes and proteins with transformative therapeutic potential which can be paired with ImmTOR to advance treatments for orphan and rare diseases. We intend to seek, if appropriate, licenses to other enzymes to evaluate in combination with ImmTOR.

Gene therapies. We believe gene therapies have the potential to address key unmet medical needs for many rare genetic diseases, but undesired immune responses to the viral vectors used for gene replacement, augmentation and editing may be restricting their broader use. AAV immunogenicity and AAV toxicity represent two major challenges for the gene therapy field; in many cases these two issues are inextricably linked. Immunogenicity of AAV vectors is thought to cause or exacerbate many of the adverse events associated with AAV gene therapy. Induction of acute inflammation and capsid-specific CD8 T cells by AAV gene therapy is thought to contribute to observations of hepatotoxicity, which has been associated with loss of transgene expression. The formation of neutralizing antibodies against AAV after initial treatment with AAV mediated gene therapies effectively prevents the possibility of re-dosing in patients who may benefit from additional doses due to either the failure to achieve therapeutic benefit or loss of transgene expression over time. Additionally, a significant number of patients who would benefit from treatment by gene therapies are ineligible due to pre-existing immunity to the AAV vectors from a natural infection. This pre-existing immunity could potentially be addressed through an IgG protease pre-treatment to open a dosing window for AAV gene therapies. We believe that the combination of ImmTOR and Xork could simultaneously address the two key issues facing the AAV gene therapy modality and make them more accessible while also making them safer and more durable.

We have observed that ImmTOR, when used in combination with AAV gene therapy vectors, inhibited the immune response to the viral vector and enabled successful re-dosing in both mice and non-human primates. Currently, the ability to re-administer systemic AAV gene therapy is limited by the development of neutralizing antibodies. The ability to safely re-dose AAV may help achieve therapeutic benefit in patients who are under-dosed; it may also help restore transgene expression in patients, particularly pediatric patients, who may lose expression over time as they grow. In a study conducted in non-human primates, or NHP, we observed that co-administration of AAV vector and ImmTOR resulted in higher and more durable transgene expression after the first dose of gene therapy as well as robust inhibition of anti-AAV8 immunoglobulin G, or IgG and neutralizing antibodies. We believe the observation that co-administration of AAV vector and ImmTOR can lead to higher transgene expression illustrates the potential for

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dosing lower levels of AAV gene therapies when combined with ImmTOR. Integrating ImmTOR into a gene therapy protocol has the potential to provide a first dose benefit by enhancing liver-directed transgene expression and durability, as well as the potential to enable re-dosing to restore or augment transgene expression.

We have observed in preclinical studies that ImmTOR may also have hepatoprotective effects in mouse models of inflammation. As hepatotoxicity is associated with higher vector doses, one potential strategy that we are pursuing is to use ImmTOR to enable multiple lower doses of AAV vectors to mitigate toxicity risks associated with high vector doses. We are concurrently working with our partner Ginkgo to develop a proprietary AAV capsid with improved transduction for liver-directed gene therapy. The below illustration depicts the potential benefits of ImmTOR in systemic AAV gene therapy.

We conducted a human proof-of-concept trial (SEL-399) in healthy volunteers who were treated with an empty AAV8 capsid (EMC-101), which is an AAV capsid containing no transgene, alone or in combination with ImmTOR. This clinical trial was conducted in Belgium in partnership with Asklepios BioPharmaceutical, Inc., or AskBio (a Bayer AG subsidiary). The goal of the SEL-399 clinical trial was to evaluate the appropriate dose of ImmTOR in humans to mitigate the formation of antibodies to AAV capsids used in gene therapies. Top-line results indicated that AAV8 empty capsids elicited peak median anti-AA8 neutralizing antibody, or NAb, titers of 1:6875. Median day 30 NAb titers were reduced to titers of 1:25 and 1:5 in the 0.15 mg/kg and 0.3 mg/kg ImmTOR cohorts, respectively, representing a 50-fold and 250-fold difference, respectively, compared to the median of control subjects dosed with AAV8 empty capsid alone, as depicted in the figure below. Further, we observed that at Day 30, six of six, or 100%, of subjects that received 0.3 mg/kg exhibited NAb titers of 1:25 or less, and four of six, or 67%, of those subjects at this dose exhibited NAb titers of 1:5 or less. We observed at Day 30 that six of nine, or 67%, of subjects that received 0.15 mg/kg of ImmTOR exhibited NAb titers of 1:25 or less, and two of nine, or 22%, of subjects at this dose had a titer of 1:5 or less. At Day 90, two of six subjects in the 0.3 mg/kg cohort were observed to have sustained control of neutralizing antibodies with titers of 1:25 or less. Consistent with preclinical data, we observed that the single dose ImmTOR cohorts showed delayed formation of neutralizing antibodies which eventually reached similar median levels of neutralizing antibodies to the control group by Day 90. Similar data were observed in NHP receiving a single dose of ImmTOR with an AAV gene therapy vector in a preclinical study. Importantly, we observed that two additional doses of ImmTOR, or a total of three monthly doses, provided durable inhibition of neutralizing antibodies in NHP. Although we could not evaluate three-monthly doses of ImmTOR in healthy volunteers, we intend to employ a three-monthly dose regimen in clinical trials performed in patients. ImmTOR showed safety results consistent with prior human studies and was generally well tolerated. No serious adverse events were reported. The most common treatment-related adverse events included mild-to-moderate stomatitis and rash. We believe this promising trial in healthy volunteers provides support for the potential use of ImmTOR for the inhibition of neutralizing antibodies to AAV8 in gene therapy clinical trials. The following graphs depict the effect of ImmTOR on the formation of neutralizing antibodies to AAV8 capsid in humans and NHP.

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Finally, pre-existing neutralizing antibodies, which develop as a result of prior infection with wildtype AAV, are a major exclusion factor in clinical trials causing many potential patients to be ineligible for gene therapy. We have licensed a bacterial IgG protease, or Xork, from Genovis AB (publ.), or Genovis. IgG proteases have been shown by others to transiently cleave IgG and enable dosing of AAV vectors in the presence of pre-existing antibodies in NHP. However, IgG proteases, being of bacterial origin, are themselves immunogenic. The most commonly studied IgG protease, called IdeS or imlifidase, is derived from Streptococcus pyogenes, a common human pathogen. Most healthy individuals have been exposed to S. pyogenes and have pre-existing antibodies against IdeS. We believe that Xork is a differentiated product candidate, as it is derived from a Streptoccocal species that does not infect humans and so the enzyme shows very low cross reactivity to naturally existing antibodies in most human serum. We plan to develop Xork with the intention of enabling access to AAV gene therapy for those patients who are currently excluded due to pre-existing anti-AAV antibodies. In January 2023, we announced an exclusive licensing and development agreement for Xork to be developed for use with AT845, Astellas Gene Therapies' investigational AAV-based treatment for Late-Onset Pompe disease in adults. We are responsible for the early development activities and manufacturing of Xork and will maintain the rights for the development of additional indications beyond Pompe disease.

Through our analysis of genetic diseases, we have identified applications and patient segments that we believe would benefit from our ImmTOR platform. Our initial area of focus is on genetic metabolic diseases but may also include lysosomal storage diseases and genetic muscular diseases. We believe we are the first company to systematically pursue the development of AAV gene therapy product candidates with the goal of enabling repeat administration. We have engaged third parties with experience in gene therapy and rare diseases to support the development of our proprietary products. We also have licensed our ImmTOR platform to AskBio, Sarepta Therapeutics, Inc., or Sarepta, and Takeda Pharmaceuticals USA, Inc., or Takeda, for certain pre-specified targets.

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Tolerogenic Therapies for Autoimmune Disease: Autoimmune diseases are caused by a breakdown in natural tolerance to our own self-antigens. With over 24 million Americans afflicted with autoimmune diseases, there is a large unmet medical need. As the ImmTOR platform is designed to induce or expand antigen specific T regulatory cells, we believe the ImmTOR platform has the potential to treat autoimmune diseases by restoring self-tolerance to auto-antigens.

Recent preclinical data generated by our scientific team suggest that ImmTOR may have profound synergistic activity with engineered IL-2 molecules that are selective for Tregs. The IL-2 pathway influences critical aspects of both immune stimulation and immune regulation. Tregs express a high affinity form of the IL-2 receptor. Low doses of IL-2 have been shown by others to selectively activate Tregs resulting in expansion of pre-existing Tregs.

In our preclinical studies, we observed that ImmTOR combined with a Treg-selective IL-2 molecule exhibited substantial synergistic activity in increasing the percentage and durability of total Treg expansion in the spleen. We believe that this combination has the potential to be a best-in-class therapy in diseases where expansion of total Treg may prove beneficial. This antigen specificity differentiates ImmTOR-IL from other IL-2 molecule approaches which do not show an antigen specific T-cell expansion. Thus, we believe that not only is ImmTOR-IL a potentially "best-in-class" IL-2 where generalized T cell expansion can be beneficial, but also a “first-in-class” antigen specific IL-2 therapy. Furthermore, in our preclinical studies, when we combined ImmTOR-IL with an antigen, we measured an approximately three-fold increase in antigen-specific T regulatory cells versus ImmTOR alone.

Our Product Candidates

Below is a summary of our ongoing discovery, research, and development programs:

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Biologic Therapies – Chronic Refractory Gout

SEL-212 consists of ImmTOR co-administered with pegadricase. Our pegadricase consists of a yeast-derived uricase modified with polyethylene glycol moieties. Uricase is an enzyme endogenous to all mammals, except for humans and certain primates, which converts serum urate to the more soluble metabolite, allantoin. There is a natural limit to the amount of serum urate that can be excreted by the kidneys, which decreases with age and can be reduced by some medications. By converting serum urate to allantoin, uricase provides an additional way for the body to reduce serum urate.

Pegadricase is designed for the treatment of patients with chronic gout, refractory to standard serum urate lowering treatment, by breaking down the excess serum urate, or SU, to the more soluble allantoin. However, the immune response to pegadricase limits administration to a single dose which is effective for less than one month. The addition of ImmTOR to pegadricase (SEL-212) allows multiple monthly doses to be administered, thus reducing serum urate for a prolonged time.

In preclinical studies and in our Phase 1b and Phase 2 clinical trials, we observed that ImmTOR, when co-administered with pegadricase, SEL-212 substantially reduced the formation of associated ADAs. We believe that SEL-212 serves as proof of concept for the ImmTOR platform in ameliorating the unwanted immune response to an immunogenic biologic. SEL-212 is in two pivotal Phase 3 studies versus placebo, which we refer to as DISSOLVE I and DISSOLVE II, with top-line data expected first quarter of 2023. SEL-212 has been licensed (except as to Greater China) to Sobi, pursuant to our license and development agreement dated June 11, 2020, with Sobi, or the Sobi License.

Enrollment into the DISSOLVE II trial is complete and the study is being conducted in the United States and four countries across eastern Europe. As a result of the ongoing and rapidly evolving geopolitical situation in Ukraine and Russia, we have proactively undertaken mitigation steps to prioritize the safety of our patients and investigators, as well as address any potential disruptions. We have reserved existing clinical trial supplies in these countries for those already enrolled in the DISSOLVE II trial. In agreement with our study partner, Sobi, we increased enrollment in DISSOLVE II to 153 subjects for potential loss of subjects enrolled in Russia and Ukraine due to operational or other issues arising from instability in the region. As of the filing of this Annual Report, we expect to report DISSOLVE I and DISSOLVE II topline results in the first quarter of 2023.

The market for gout therapy

Gout is a painful and potentially disabling form of arthritis associated with elevation of SU levels caused by an overproduction of serum urate and/or an inability of the kidneys to excrete adequate amounts of serum urate from the body. High concentrations of SU lead to formation of serum urate crystals in joints and tissues, causing pain, inflammation and joint damage, and increase the risk for other conditions, including cardiovascular, cardiometabolic, joint and kidney disease.

Patients who are unable to reduce their SU levels below 6.0 mg/dL with oral drugs are defined as having refractory gout. Chronic refractory gout constitutes a subset of gout patients exhibiting chronic high SU levels and painful and damaging serum urate deposits. We estimate that there are approximately 160,000 chronic refractory gout patients in the U.S.

We believe SEL-212 may potentially address several key unmet needs in the treatment of chronic refractory gout: the durable control of SU levels, the elimination of painful and damaging serum urate deposits, reduction in incidence and severity of flares, based on our preclinical studies, clinical trials, and market research. SEL-212 is designed to address these unmet medical needs while improving the dosing regimen to a once-monthly treatment.

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SEL-212 Clinical Development

We conducted Phase 1a, Phase 1b, and Phase 2 clinical trials for SEL-212 at multiple sites in the United States. These trials were designed to demonstrate the induction of an immune response to pegadricase and the ability of ImmTOR to mitigate that immune response to both single and multiple doses. The table below summarizes the trial designs and objectives of these clinical trials.

Design Objective

In the Phase 1a trial, we observed that a single dose of pegadricase rapidly reduced SU levels below 6.0 mg/dL for each dose level, although SU levels returned close to baseline by day 30. Consistent with our preclinical studies in animals, pegadricase induced uricase-specific ADAs in all patients with varying levels in this Phase 1a trial. The following table depicts the observations from the single ascending dose trial of pegadricase in patients with hyperuricemia. In this trial, patients with SU > 6 mg/dL at screening were assigned to one of five cohorts receiving a single IV infusion of pegadricase (0.1, 0.2, 0.4, 0.8 or 1.2 mg/kg). Each cohort consisted of five patients, except for cohort 5 (1.2 mg/kg) which enrolled two patients.

In the Phase 1b clinical trial, we observed the potential for increasing doses of ImmTOR to mitigate the formation of pegadricase ADAs and sustain the anti-uricase enzyme activity through 30 days. The cohort of subjects who received a single 0.4 mg/kg dose of pegadricase alone showed development of uricase ADAs, a short pegadricase half-life, and poor control of SU at 30 days. Three cohorts who received 0.4 mg/kg of pegadricase plus ascending doses of ImmTOR (0.1, 0.15 and 0.3 mg/kg) showed a dose related reduction in uricase ADAs, an increase in pegadricase half-life, and substantial reduction in SU. This graphs below depict the observed correlation of SU with anti-uricase IgG and serum pegadricase activity. In these graphs, anti-uricase IgG titers, serum pegadricase activity, and SU are plotted against time for individual patients in cohorts A, G, H, and I. Each line represents an individual patient.

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The Phase 2 trial included patients with symptomatic gout and elevated SU levels in an open-label, multiple ascending-dose clinical trial of SEL-212 to demonstrate sustained reduction of SU and identify the best dose for Phase 3. Five monthly doses of SEL-212 reduced SU to less than 6.0 mg/dL in 21 of 32 evaluable patients, or 66%. In distinct contrast, pegadricase alone reduced SU to less than 6.0 mg/dL in only three of 19 patients one month after a single injection (data from pegadricase alone cohorts from the SEL-037/101, SEL-212/101, and SEL-212/201 trials). We believe these results support our view that the addition of ImmTOR to pegadricase is able dramatically enhance the efficacy of pegadricase in the long-term reduction of SU in gout patients. The chart below depicts SU after five monthly doses of SEL-212.

We have observed that SEL‐212 and its components, ImmTOR and pegadricase, were generally well-tolerated in the Phase 1a, 1b, and 2 clinical trials. In the Phase 1a trial we observed no serious adverse events, or SAEs, and that pegadricase was well tolerated at the five dose levels tested. Of the six SAEs in the Phase 1b trial, three were determined to not to be related to study drug by investigators. Of the remaining three SAEs that were determined to possibly or likely be related to study drug, two were cases of stomatitis that occurred at the highest dose of ImmTOR tested (0.5 mg/kg), leading us to define 0.3 mg/kg as the maximum tolerated dose of ImmTOR in this patient population. The remaining SAE was a case of drug hypersensitivity that occurred at a dose of 0.1 mg/kg of ImmTOR in combination with 0.4 mg/kg of pegadricase. In the Phase 2 trial, 20 subjects reported a total of 23 SAEs, nine in the five dose combination cohorts, seven of which were reported to be not related or unlikely related to study drug, and two of which were infusion reactions. All SAEs were successfully treated without residual effects.

Phase 2 head-to-head clinical trial

In March 2019, we initiated a non-registrational Phase 2 head-to-head clinical trial of SEL-212, which we refer to as COMPARE, in which SEL-212 was compared against the current FDA-approved therapy for chronic refractory gout, pegloticase, in multiple clinical sites in the United States.

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In September 2020, we announced top-line results from the COMPARE trial. We observed a numerically higher response rate to pegloticase on the primary endpoint during months three and six combined but did not meet the primary endpoint of statistical superiority. SEL-212 did generate a statistically significant higher response rate to pegloticase during the third month of treatment, as well as a statistically significant greater overall reduction in mean SU levels in SEL-212 versus pegloticase in months three and six combined. We observed a numerically higher response rate of SEL-212 during the sixth month of treatment. In patients with tophi at baseline, we observed substantially higher responder rates for SEL-212 compared to pegloticase on the primary endpoint, and a statistically significant reduction in mean SU levels when compared to pegloticase.

Approximately 41% of patients in the Phase 2 COMPARE trial had visible tophi at baseline, which is lower than we expected for the general refractory gout population. However, in these most severe patients with tophi, SEL-212 was superior to pegloticase with a 58% responder rate for SEL-212 versus a 39 % responder rate for pegloticase. Response rates observed in patients with tophi at baseline are depicted below.

SEL-212 showed a favorable safety profile and was well-tolerated. There were no deaths during the study. There were no notable differences in serious TEAEs, treatment-related serious TEAEs, or infusion reactions between the two groups. A full analysis of safety signals, including gout flare incidence and severity, requires evaluation of the full data set and will be reported together with the full efficacy analysis in a manuscript in a medical journal.

Phase 3 DISSOLVE clinical program

In September 2020, we commenced the Phase 3 clinical program of SEL-212, which we refer to as DISSOLVE. We are responsible for the execution of the DISSOLVE program and are being reimbursed by Sobi on a quarterly basis for expenses incurred in connection with these activities. The Phase 3 clinical program consists of two double-blinded, placebo-controlled trials of SEL-212. We refer to these trials as DISSOLVE I and DISSOLVE II. Each trial was expected to enroll up to 120 patients, with up to 40 patients receiving 0.1 mg/kg of ImmTOR and 0.2 mg/kg of pegadricase, up to 40 patients receiving 0.15 mg/kg of ImmTOR and 0.2 mg/kg of pegadricase, and up to 40 patients receiving placebo. An additional 15 patients were added to the study sample size to account for potential treatment discontinuations due to the ongoing COVID-19 pandemic as a result of the emergence of COVID-19 variants which were not accounted for in the sample size calculations. In agreement with our study partner, Sobi, we increased enrollment in DISSOLVE II to 153 subjects for potential loss of subjects enrolled in Russia and Ukraine due to operational or other issues arising from instability in the region.

We commenced enrollment of DISSOLVE I in September 2020 and DISSOLVE II in December 2020. In December 2021, we announced the completion of enrollment of the DISSOLVE I trial. DISSOLVE I has a six-month primary endpoint followed by a six-month safety extension. In June 2022, we announced the completion of enrollment of the DISSOLVE II trial. DISSOLVE II will have a six-month primary endpoint with no extension. The primary endpoint of the DISSOLVE program is

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the maintenance of SU levels below 6 mg/dL at six months. As of the filing of this Annual Report, we expect to report DISSOLVE I and DISSOLVE II topline results in first quarter of 2023.

Biologic Therapies – IgA Nephropathy

The second development program in biologic therapies is in IgA nephropathy, an autoimmune kidney disease that occurs when immune complexes of a subclass of antibodies called immunoglobulin A1, or IgA1, accumulates in the kidneys. Previous studies in animal models conducted at independent laboratories demonstrated that bacterial IgA protease has the potential to remove injurious IgA immune complexes from kidneys and reduce inflammation, fibrosis, and hematuria. We believe these results suggest that IgA protease can potentially decrease the rate of disease progression and possibly even reverse the disease. The barrier to IgA protease commercialization has been the bacterial origin of the protease, which makes it highly immunogenic. Based on the learnings of SEL-212, we believe the combination of ImmTOR with an IgA protease could potentially enable repeated dosing to treat IgA nephropathy.

In clinical trials, we have observed ImmTOR mitigating the formation of ADAs to immunogenic enzymes. We intend to combine an IgA protease with our ImmTOR platform to develop a novel combination product candidate for the treatment of IgA nephropathy and IgA-mediated diseases. In December 2022, we announced the selection of a next generation IgA protease candidate from IGAN Biosciences for its IgA nephropathy program.

In October 2020, we entered into an Option and License Agreement, or the IGAN Agreement, with IGAN Biosciences, Inc., or IGAN. Pursuant to the IGAN Agreement, IGAN granted us an exclusive license to research, evaluate, and conduct pre-clinical development activities on IGAN’s proprietary IgA proteases. We had an initial option term of 24 months, during which we could elect to obtain an exclusive license to further develop and commercialize the product candidate to treat all IgA-mediated diseases, including IgA nephropathy, Linear IgA bullous dermatitis, IgA pemphigus, and Henoch-Schonlein purpura (also known as IgA vasculitis).

In May 2022, we entered into Amendment No. 1 to the IGAN Agreement, or the First IGAN Amendment, with IGAN. The First IGAN Amendment provided an extension to the option term of 24 months from the date of the First IGAN Amendment.

In December 2022, we exercised our option to opt-in to an exclusive license agreement and selected a next generation IgA protease candidate from a commensal bacteria with a lower level of baseline ADAs from IGAN for the treatment of IgA nephropathy. By combining ImmTOR with this next generation IgA protease candidate, we believe our novel approach has the potential to mitigate the formation of new ADAs and address the underlying pathophysiology of the disease.

In October 2021, we entered into a Collaboration and License Agreement, or the First Ginkgo Agreement, with Ginkgo. Pursuant to the First Ginkgo Agreement, Ginkgo will leverage their high throughput enzyme discovery, design and screening capabilities to identify and further optimize a proprietary, next generation IgA protease. We have an exclusive license to further develop and commercialize the discovered IgA proteases to treat all IgA-mediated diseases, including IgA nephropathy, Linear IgA bullous dermatitis, IgA pemphigus, and Henoch-Schonlein purpura.

These collaborations build on extensive preclinical as well as strong clinical data from our Phase 2 COMPARE trial for the treatment of chronic refractory gout that we believe further supports ImmTOR’s potential for sustained therapeutic benefit when combined with immunogenic enzymatic therapies.

We are continuing to perform pre-clinical IND enabling studies.

Gene Therapies – Methylmalonic Acidemia

Our lead therapeutic gene therapy program, SEL-302, is intended to use ImmTOR to enhance the treatment of methylmalonic acidemia, or MMA, an inherited disorder in which the body is unable to process certain proteins and fats (lipids) properly. This program was previously being conducted under our collaboration with AskBio. In October and November 2020, we received rare pediatric disease designation and orphan drug designation, respectively, from the FDA for MMA-101, for the treatment of MMA due to methylmalonyl-CoA mutase, or MMUT gene mutations. See “⸺Licenses and Collaborations⸺AskBio” for more information. In April 2021, we were notified by AskBio that it intended to opt-out of development of the MMA indication. The feasibility study and license agreement with AskBio, or AskBio Collaboration Agreement, otherwise remains in effect. We filed an IND to conduct a Phase 1/2 clinical trial of our SEL-302 product candidate in pediatric patients with methylmalonic acidemia in the third quarter of 2021. ImmTOR manufacturing, controlled by us, continues to proceed in accordance with our expectations and we have not observed any impact to any of our ImmTOR programs. In October and November 2020, we received rare pediatric disease designation and orphan drug designation, respectively, from the FDA for MMA-101, for the treatment of MMA due to methylmalonyl-CoA mutase, or MMUT gene mutations. In December 2022, we initiated ReiMMAgine, the Phase 1/2 clinical trial of SEL-302. The ReiMMAgine trial is now enrolling patients and aims to evaluate the safety, tolerability and efficacy of SEL-302.

Gene Therapies – IgG Protease (Xork)

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We have exclusively licensed Xork, an IgG-specific protease from Genovis, an enzyme technology company. We plan to develop Xork, either alone or in combination with our ImmTOR platform, with the goal of enabling the dosing of transformative gene therapies in patients with pre-existing AAV immunity due to natural exposures to AAV viruses. Currently, significant proportions of the potential patient populations for many gene therapy trials are ineligible for treatment by AAV mediated gene therapies due to pre-existing antibodies which limits transduction efficiency of the therapy and could trigger potentially dangerous immune responses. IgG proteases are derived from bacteria. Xork exhibits low cross-reactivity to antibodies in normal human serum and is differentiated from IgG proteases derived from Streptococcus pyogenes, a common human pathogen.

Because of this, the commercial potential of many gene therapies may be significantly limited due to the ineligibility of large segments of the target patient population. This is particularly important for gene therapies given the low incidence and small prevalent populations of rare monogenic diseases which many gene therapies target. Patients that are ineligible for gene therapy due to pre-existing immunity may have few or no alternative therapies available to them.

Xork, as a pre-treatment in advance of an AAV gene therapy, can potentially open a treatment window by cleaving the IgG antibodies and transiently reducing their concentration.

IgG proteases are bacterial proteins, which are themselves immunogenic. We believe that Xork is differentiated from other IgG proteases since it is not derived from a human pathogen and thus, exhibits low cross-reactivity with human sera. Additionally, to further reduce any potential immunogenicity of the Xork enzyme, we plan to explore the combination of Xork and ImmTOR. The following images depict how Xork cleaves human IgG specifically and efficiently, but shows low cross reactivity to human sera compared to IdeS, an IgG protease derived from the common human pathogen Streptococcus pyogenes.

We believe that the combination of Xork and ImmTOR has the potential to address two of the major challenges to AAV gene therapy, pre-existing immunity that limits eligibility and de novo immunogenicity that can adversely affect safety and durability and which prevents the ability to re-dose AAV. We plan to explore the application of Xork in combination with our wholly owned gene therapies, as well as explore partnering opportunities for the enzyme with other gene therapy companies.

In January 2023, we announced an exclusive licensing and development agreement for Xork to be developed for use with AT845, Astellas Gene Therapies' investigational AAV-based treatment for Late-Onset Pompe disease in adults. We are responsible for the early development activities and manufacturing of Xork and will maintain the rights for the development of additional indications beyond Pompe disease.

Tolerogenic Therapies for Autoimmune Disease – ImmTOR & ImmTOR-IL

We intend to apply our ImmTOR platform to treat autoimmune diseases. In preclinical studies, we have observed ImmTOR’s ability to induce antigen-specific T regulatory cells. We believe that ImmTOR, in combination with an autoantigen of interest, could create self-tolerance to auto-antigens and thus be a novel approach to the treatment of autoimmune diseases.

Additionally, in preclinical studies we have observed ImmTOR, in combination with IL-2 molecules, expanding T-regulatory cells beyond IL-2 alone and we intend to pursue a combination of ImmTOR and IL-2 (ImmTOR-IL) in diseases

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where general T cell expansion has shown a therapeutic benefit. Additionally, we have observed in preclinical studies that the combination of ImmTOR, a Treg-selective IL-2 molecule and an antigen, exhibited substantial synergistic activity in inducing and expanding antigen specific regulatory T cells when ImmTOR and IL-2 is combined with an antigen of interest. We intend to pursue and develop treatments for autoimmune diseases with well-defined antigens using either ImmTOR or ImmTOR-IL.

Cyrus Biotechnology, Inc., a collaboration partner, is engineering a proprietary IL-2 protein to combine with the ImmTOR platform to potentially mitigate unwanted immune responses by reducing the inherent immunogenicity of the protein while also promoting immune tolerance. The IL-2 pathway influences critical aspects of both immune stimulation and immune regulation, through the development and expansion of Treg cells. These Treg cells are a specialized subpopulation of T cells involved in suppressing certain immune responses and maintaining the body’s self-tolerance. In preclinical studies investigating the effects of ImmTOR in combination with a Treg-selective IL-2 molecule we have observed a substantial synergistic activity in increasing the percentage and durability of Treg expansion in the spleen.

Our lead autoimmune diseases indication is PBC, a T cell driven autoimmune disease that causes progressive destruction of the bile ducts. Patients with PBC are in need of a highly targeted, liver-directed approach to treating the root cause of the disorder. We believe PBC has a well-defined target antigen, significant unmet medical need, and is well suited to the application of our ImmTOR immune tolerance platform, as preclinical data suggest that ImmTOR has the potential to enhance the tolerogenic environment in the liver and provide a hepatoprotective benefit.

Licenses and Collaborations

We intend to both partner and strategically out-license ImmTOR, ImmTOR-IL and Xork for use with other products that are outside our focus to larger biopharmaceutical companies. We believe our ImmTOR platform may also be of interest to biopharmaceutical companies with novel biologic development concepts or product candidates in clinical development that have demonstrated initial efficacy but are experiencing issues with safety or sustained efficacy due to inhibitory ADAs. Additionally, we may strategically in-license products to combine with ImmTOR and develop novel therapeutic products independently. Our key partnerships are listed below.

In-licenses

Ginkgo Bioworks Holdings, Inc.

In October 2021, we entered into the First Ginkgo Agreement with Ginkgo. Under the First Ginkgo Agreement, Ginkgo will design next generation IgA proteases with potentially transformative therapeutic potential. In return, Ginkgo is eligible to earn both upfront research and development fees and milestone payments, including certain milestone payments in the form of our common stock, clinical and commercial milestone payments of up to $85 million in cash, as well as downstream value in the form of royalties on sales.

On January 3, 2022, we entered into a Collaboration and License Agreement, or the Second Ginkgo Agreement, with Ginkgo. Under the Second Ginkgo Agreement, we will engage with Ginkgo to design novel AAV capsids with potentially improved transduction, enhanced tissue tropism and reduced immunogenicity. In return, Ginkgo is eligible to earn both upfront research and development fees and milestone payments, including certain milestone payments in the form of our common stock, clinical and commercial milestone payments of up to $207 million in cash for each of a specified number of products which have the potential to total, in the aggregate, up to $1.1 billion. Ginkgo is also entitled to potential further downstream value in the form of royalties on sales.

Genovis AB (publ.)

In October 2021, we entered into a strategic licensing agreement with Genovis, or the Genovis Agreement. Under the Genovis Agreement, we paid to Genovis an upfront payment in exchange for an exclusive license to Genovis’ Xork enzyme technology for all therapeutic uses in humans, excluding research, preclinical, diagnostic, and other potential non-therapeutic applications of the enzyme. Genovis is eligible to earn development and sales-based milestones and sublicensing fees, as well as tiered royalties on worldwide sales in the low double digits.

Cyrus Biotechnology, Inc.

In September 2021, we entered into a Collaboration and License Agreement with Cyrus, or the Cyrus Agreement, pursuant to which Cyrus agreed to grant us an exclusive, worldwide license to certain intellectual property in order to form a protein engineering collaboration combining the ImmTOR platform with Cyrus’ engineered protein therapeutics. We expect that novel engineered protein therapeutic candidates from the partnership will be used to expand our proprietary pipeline and further bolster the ImmTOR platform. In return for the licensed intellectual property, we made an upfront payment and will pay certain discovery, development, and sales-based milestones which could potentially total up to approximately $1.5 billion across multiple programs.

In June 2022, we mutually agreed with Cyrus that the preclinical key in-vitro success milestone had been achieved.

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IGAN Biosciences, Inc.

In October 2020, we entered into the IGAN Agreement with IGAN. Pursuant to the IGAN Agreement, IGAN granted us an exclusive license to research, evaluate, and conduct preclinical development activities on IGAN’s proprietary IgA proteases. We have an option term of 24 months, or the Option Term, during which we can elect to obtain an exclusive license to further develop and commercialize the product to treat all IgA-mediated diseases, including IgA nephropathy, Linear IgA bullous dermatitis, IgA pemphigus, and Henoch-Schonlein purpura.

Upon execution of the IGAN Agreement, we paid IGAN a one-time upfront payment of $0.5 million and we would owe additional payments to IGAN if we were to opt-in to an exclusive license agreement, as well as upon the achievement of certain development and sales milestones. During the option term, we may terminate the IGAN Agreement immediately for any reason upon written notice to IGAN. If we opt-in to an exclusive license agreement, we may terminate the IGAN Agreement upon 120 days’ written notice.

On May 25, 2022, we entered into Amendment No. 1 to the IGAN Agreement, or the First IGAN Amendment, with IGAN. The First IGAN Amendment provided an extension to the option term of 24 months from the date of the First IGAN Amendment.

On December 14, 2022, we exercised our option to opt-in to an exclusive license agreement and selected a next generation IgA protease candidate from a commensal bacteria with a lower level of baseline ADAs from IGAN for the treatment of IgA nephropathy. By combining ImmTOR with this next generation IgA protease candidate, we believe our novel approach has the potential to mitigate the formation of new ADAs and address the underlying pathophysiology of the disease.

Out-licenses

Astellas Therapeutics, Inc.

In January 2023, we entered into a License and Development Agreement with Astellas Therapeutics, Inc., or Astellas. Under this agreement, Astellas obtained the sole and exclusive right to commercialize Xork for use in Pompe disease with an Astellas gene therapy investigational or authorized product, with a current focus on AT845. We received a $10 million upfront payment and are eligible to receive $340.0 million for certain additional development and commercial milestones plus royalties on any potential commercial sales where Xork is used as a pre-treatment for AT845. As a result of the sublicense of Xork to Astellas, we made a $4.0 million payment to Genovis in February 2023.

Takeda Pharmaceuticals USA, Inc.

In October 2021, we entered into a strategic licensing agreement with Takeda, or the Takeda Agreement. Under the Takeda Agreement, we granted Takeda an exclusive license to our ImmTOR technology initially for two specified disease indications within the field of lysosomal storage disorders. Under the terms of the Takeda Agreement, we received an upfront payment and are entitled to receive up to $1.124 billion in future additional payments over the course of the partnership that are contingent on the achievement of development or commercial milestones or Takeda’s election to continue its activities at specified development stages. We are also eligible for tiered royalties on future commercial sales of any licensed products.

Swedish Orphan Biovitrum AB (publ.)

In June 2020, we announced that we had entered into the Sobi License, pursuant to which we agreed to grant Sobi an exclusive, worldwide (except as to Greater China) license to develop, manufacture and commercialize SEL-212, which is currently in development for the treatment of chronic refractory gout. In September 2020, pursuant to the Sobi License, Sobi paid us a one-time, upfront payment of $75 million. Sobi has also agreed to make milestone payments totaling up to $630 million to us upon the achievement of various development and regulatory milestones and sales thresholds for annual net sales of SEL-212, and tiered royalty payments ranging from the low double digits on the lowest sales tier to the high teens on the highest sales tier. In July 2022, we received $10.0 million for the completion of the enrollment of the DISSOLVE II trial.

Additionally, Sobi purchased an aggregate of 5,416,390 shares of our common stock at a purchase price of $4.6156 per share for aggregate gross proceeds of $25 million, which we refer to as the Sobi Private Placement. The closing of the Sobi Private Placement occurred on July 31, 2020.

Under the Sobi License, we will have operational oversight of the Phase 3 DISSOLVE clinical program of SEL-212 (DISSOLVE I and DISSOLVE II) that commenced in September 2020, at Sobi’s expense. We expect to report DISSOLVE I and DISSOLVE II topline results in first quarter of 2023.

Sarepta Therapeutics, Inc.

In June 2020, we entered into a research license and option agreement with Sarepta, or the Sarepta Agreement. Pursuant to the agreement, we granted Sarepta a license to research and evaluate ImmTOR in combination with Sarepta’s AAV gene therapy or gene editing technology, using viral or non-viral delivery, or the Sarepta Product, to treat Duchenne Muscular Dystrophy and certain Limb-Girdle Muscular Dystrophy subtypes, or the Sarepta Indications. Sarepta will have an option term of 24 months during which it can opt-in to obtain an exclusive license to further develop and commercialize the Sarepta Product

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to treat at least one Sarepta Indication, with a potential to extend the option term if Sarepta pays an additional fee to us. Sarepta made an upfront payment of $2.0 million to us upon signing of the agreement, and we are eligible to receive additional payments under the option term. If Sarepta opts-in to an exclusive license agreement, we could receive option exercise payments per indication and we would be entitled to significant development and commercial milestone payments and tiered royalties ranging from the mid-to-high single digits based on net sales. In June 2021, we received a payment of $3.0 million for the achievement of certain pre-clinical milestones. In August 2022, we received a payment of $2.0 for a nine-month extension to Sarepta’s options to both Duchenne muscular dystrophy and certain limb-girdle muscular dystrophies and a payment of $4.0 million for the achievement of certain pre-clinical milestones.

Asklepios Biopharmaceutical, Inc.

In August 2019, we entered into a feasibility study and license agreement with AskBio, or the AskBio Collaboration Agreement. The initial product candidate being developed under this collaboration is gene therapy for MMA which can cause severe developmental defects and premature death as a result of an accumulation of toxic metabolites. We previously conducted preclinical studies for this product candidate and will leverage that previous work within the collaboration. In April 2021, we were notified by AskBio that it intended to opt-out of development of the MMA indication. The feasibility study and license agreement with AskBio, or AskBio Collaboration Agreement, otherwise remains in effect.

Massachusetts Institute of Technology

In 2008, we entered into a license agreement with the Massachusetts Institute of Technology, or MIT, which we refer to in its amended form as the MIT License. We amended the MIT License in January 2010, August 2013, November 2016, December 2019 and June 2020. Under the MIT License, we acquired an exclusive worldwide license, with the right to grant sublicenses, to develop, make, sell, use and import certain licensed products that are therapeutic or prophylactic vaccines and use certain licensed processes in the exercise of rights to the licensed products, the manufacture, sale and practice of which are covered by patent rights owned or controlled by MIT, including patents jointly owned with Brigham and Women’s Hospital, or Brigham, the President and Fellows of Harvard College, the Immune Disease Institute and the Children’s Medical Center Corporation. Our exclusivity is subject to certain retained rights of these institutions and other third parties.

Upon our entry into the MIT License, we paid MIT a non-refundable license issue fee, reimbursed certain of MIT’s costs and issued shares of our common stock to MIT and the other institutional patent owners which were subject to certain anti-dilution, registration and other protective rights. We are obligated to pay MIT creditable annual maintenance fees, low-single-digit running royalty on annual net sales, developmental milestones up to an aggregate of $1.5 million, a mid-single digit percentage of certain payments we receive from corporate partners and a specified percentage of certain income received from sublicensees after 2009 between 10% and 30%. We may terminate the MIT License at any time upon six months’ written notice. MIT has the right to terminate the MIT License immediately upon written notice to us if we cease to carry on our business related to the MIT License, fail to maintain insurance as required under the MIT License, file for bankruptcy, fail to pay amounts due under the MIT License, challenge or assist others in bringing a challenge to MIT’s patents or fail to cure material breach within 60 days’ written notice thereof. Absent early termination, the MIT License will continue until the expiration or abandonment of the last to expire patent right subject to the MIT License.

In June 2020, we entered into a Fifth Amendment to the MIT License, or the MIT Amendment, which was effective as of May 15, 2020. Pursuant to the MIT Amendment, certain of our diligence obligations were extended to the second quarter of 2021, including a diligence obligation to commence a Phase 3 trial for a licensed product by a specific date in the second quarter of 2021 or to file an IND for a licensed product by a specific date in the third quarter of 2023. Additionally, certain of our development and regulatory milestones and payments upon achievement of such milestones were adjusted.

Shenyang Sunshine Pharmaceutical Co., Ltd.

In 2014, we entered into a license agreement with 3SBio, as amended in 2017, which we refer to as the 3SBio License. Pursuant to the 3SBio License, we were granted an exclusive license to certain pegadricase-related patents and related know-how owned or in-licensed by 3SBio for the worldwide (except for Greater China and Japan) development and commercialization of products based thereupon for human therapeutic, diagnostic and prophylactic use. We are also granted a worldwide (except for Greater China) exclusive license to develop, commercialize and manufacture or have manufactured products combining our proprietary ImmTOR platform with pegadricase or related compounds supplied by 3SBio (or otherwise supplied if our rights to manufacture are in effect) for human therapeutic, diagnostic and prophylactic use. We were also granted a co-exclusive license to manufacture and have manufactured pegadricase and related compounds for our preclinical and clinical use or, if the 3SBio License is terminated for 3SBio’s material breach, for any use under the 3SBio License. In addition, the 3SBio License, as amended, permits us to utilize one or more third parties to provide up to 20% of our commercial supply of pegadricase. Otherwise, except in the case of a supply shortage on the part of 3SBio, we are obligated to obtain at least 80% of our supply of such compounds for Phase 3 clinical trials and commercial use from 3SBio under the terms of our separate Commercial Supply Agreement with 3SBio dated August 1, 2019.

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Under the 3SBio License we have paid to 3SBio an aggregate of $7.0 million in upfront and milestone-based payments. We are required to make future payments to 3SBio contingent upon the occurrence of events related to the achievement of clinical and regulatory approval milestones of up to an aggregate of $15.0 million for products containing our ImmTOR platform. We are also required to pay 3SBio tiered royalties on annual worldwide net sales related to the pegadricase component of products at percentages ranging from the low-to-mid single digits for products containing our ImmTOR platform, subject to specified reductions. These royalties are payable, on a country-by-country and product-by-product basis until the later of (i) the date that all of the patent rights for that product have expired in that country or (ii) a specified number of years from the first commercial sale of such product in such country.

The 3SBio License expires on the date of expiration of all of our royalty payment obligations unless earlier terminated by either party for an uncured material default of the other party or for the other party’s bankruptcy. We may also terminate the 3SBio License on a country-by-country or product-by-product basis for any reason effective upon 60 days’ prior written notice to 3SBio or, with respect to a given product, immediately upon written notice to 3SBio if we identify a safety or efficacy concern related to such product.

Manufacturing

We manufacture ImmTOR using a scalable, self-assembly nanoemulsion process with well-defined, pharmaceutical unit operations. This proprietary, highly specialized and precisely controlled manufacturing process enables us to reproducibly manufacture ImmTOR across many production scales, from milligram-scale at the laboratory bench to hundreds of grams to multi-kilogram scale for commercial production. We have also developed and executed the required detailed analytic characterization of our products.

For our most advanced product candidate, SEL-212, we are producing ImmTOR at an approximately 400-gram scale process, which, at the doses being tested in the Phase 3 DISSOLVE program, we believe will be suitable for commercialization. The process is designed such that this same equipment is capable of potentially producing up to a one-kilogram batch size scale. As our nanoparticle manufacturing process is compact, and therefore also portable, our strategy is to transfer our custom designed process skids to a contract manufacturing organization, or CMO, and have the CMO produce the nanoparticles under our direction. This is the strategy we use for production of clinical supplies for clinical trials and would be the expected strategy for commercial production.

The pegadricase enzyme for SEL-212 is produced by fermentation in E. coli and is sourced from 3SBio in China. Through a licensing arrangement, we own exclusive worldwide rights to pegadricase outside of China, with co-ownership of rights in Japan and with 3SBio owning all rights in China. Under this arrangement, 3SBio has agreed to supply pegadricase for the SEL-212 program. There is also a second supplier for pegadricase in the United States.

Our AAV vector product candidates are produced using the established triple transfection production process at CMOs. We work closely with our CMOs who have platform AAV production processes that we are able to leverage for our specific AAV product candidates.

Intellectual Property

Our ImmTOR platform is designed to deliver precise instructions to the immune system as a result of the natural predisposition of the immune system to interrogate nanoparticles such as viruses. In connection with our founding, we licensed multiple patent families, including a patent family based in part on the pioneering research performed by our co-founders at Harvard University, MIT and Brigham. We have also conducted extensive research in-house to further research this area, leading to key discoveries regarding and uses for our ImmTOR technology. We have aggressively sought to extend and protect the proprietary intellectual property underlying the composition and use of ImmTOR, such as for antigen-specific immunotolerance.

We endeavor to protect our nanoparticle technology, which we consider fundamental to our business, by seeking, maintaining and defending patent and other intellectual property rights, whether developed internally or licensed from third parties, relating to our program, product candidates, their methods of use and the processes for their manufacture. Our practice is to strive to protect our intellectual property by, among other methods, pursuing and obtaining patent protection in the United States and in jurisdictions outside of the United States related to our proprietary technology, inventions, improvements, programs and product candidates that are commercially important to the operation and growth of our business. We also rely on trade secrets and know-how relating to our proprietary technology, programs and product candidates, and continue innovating and seeking in-licensing opportunities to maintain, advance and fortify our proprietary position in our nanoparticle-based immunotherapy program and product candidates as well as to develop new programs and other product candidates. Our commercial success will depend in part on our ability to obtain and maintain patent and other proprietary protection for our technology programs, inventions and improvements; to preserve the confidentiality of our trade secrets; to maintain our licenses to use intellectual property owned or controlled by third parties; to defend and enforce our proprietary rights, including our patents; and to operate without infringing the patents and proprietary rights of third parties.

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We have developed and in-licensed numerous patents and patent applications and possess substantial know-how and trade secrets relating to our technology programs and product candidates. Our patent portfolio contains a number of issued patents in the United States and certain foreign jurisdictions. We also own a number of pending patent applications in the United States and certain foreign jurisdictions. These patents and patent applications include claims related to:

•tolerance immunotherapy programs;

•methods and compositions related to our proprietary nanoparticles in a variety of applications, including tolerance applications, such as:

◦mitigating anti-drug antibodies and/or their effects associated with protein drugs, such as for chronic refractory gout, including coverage for ImmTOR co-administered with pegadricase, which related patents are expected to expire between 2032 and 2041, and

◦genetic therapies (such as viral vector gene therapy), including coverage for ImmTOR co-administered with a viral vector, which related patents are expected to expire between 2032 and 2042; and

•development and commercialization of SEL-212, including both composition of matter and method of treatment claims (there are multiple patent families with claims that cover the SEL-212 product, one of which is a licensed, issued U.S. patent that expired in August 2021).

In addition, we have exclusively or non-exclusively licensed intellectual property, including U.S. issued patents, foreign issued patents, and pending applications in both the U.S. and foreign jurisdictions. The licensed patents and patent applications cover various aspects of the technology being developed by us, including claims directed to compositions of matter and methods of use, and have been filed in various countries worldwide including in North America, Europe and Asia, with material expiration dates varying to, if claims are issued, 2042. In addition to filing and prosecuting patent applications in the United States, we often file analogous patent applications in the European Union and in additional foreign countries where we believe such filing is likely to be beneficial, including but not limited to, Australia, Brazil, Canada, China, India, Israel, Japan, Mexico and/or South Korea.

Each patent’s term depends upon the laws of the countries in which they are obtained. The patent term in most countries in which we file is 20 years from the earliest date of filing of a non-provisional patent application. Notably, the term of U.S. patents may be extended due to delays incurred due to compliance with FDA or by delays encountered during prosecution that are caused by the USPTO. For example, the Hatch-Waxman Act permits a patent term extension for FDA-approved drugs of up to five years beyond the expiration of the patent, depending upon the length of time the drug is under regulatory review. There is a limit to the amount of time a patent may be extended in the United States; no patent extension can extend the remaining term of a patent beyond a total of 14 years from the date of product approval and only one patent applicable to an approved drug may be extended. Similar patent term extensions are available in Europe and other jurisdictions for patents that cover regulatory-approved drugs. Currently, we own or license patents and patent applications with expected material expiration dates ranging from 2032 to 2043. However, the actual patent protection period varies on a product-by-product basis, from country-to-country, and depends upon many factors, including the type of patent, the scope of its coverage, the availability of regulatory-related extensions, the availability of legal remedies in a particular country and the validity and enforceability of the patent.

Competition

The biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products. We face potential competition from many different sources, including pharmaceutical and biotechnology companies, academic institutions and governmental agencies and public and private research institutions. Product candidates that we successfully develop and commercialize may compete with existing therapies and new therapies that may become available in the future.

Our competitors may have significantly greater financial resources, established presence in the market, expertise in research and development, manufacturing, preclinical and clinical testing, obtaining regulatory approvals and reimbursement and marketing approved products than we do. These competitors also compete with us in recruiting and retaining qualified scientific, sales, marketing and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

The key competitive factors affecting the success of any other tolerance or immune modulation product candidates that we develop, if approved, are likely to be their efficacy, safety, convenience, price, the level of generic competition and the availability of reimbursement from government and other third-party payors.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop. Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may

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obtain approval for ours. In addition, our ability to compete may be affected in many cases by insurers or other third-party payors seeking to encourage the use of generic or biosimilar products.

SEL-212 may compete with others in the gout market, including pegloticase, which contains a pegylated uricase similar to the pegadricase component of SEL-212 and is indicated for the treatment of refractory gout. Horizon Pharma plc, whose affiliates own pegloticase, may find other approaches to eliminate undesired immunogenicity to pegloticase. Long-term treatment with global immunosuppressive products may increase the susceptibility to contract infections, tumors and may lead to organ failure.

Large companies with active research to prevent the formation of ADAs and treat allergies or autoimmune diseases include Eli Lilly, Roche Holding AG, Sanofi S.A., Pfizer Inc., and Merck & Co., Inc. Small, early-stage biopharmaceutical companies active in the research for new technologies to induce antigen-specific immune tolerance include Abata Therapeutics, Anokion SA, Cour Pharmaceutical Development Company, Inc., Cue Biopharma, Parvus Therapeutics, REGiMMUNE Corporation, Topas Therapeutics GmbH, Sangamo Therapeutics, and SQZ Biotechnologies. Biopharmaceutical companies active in the research for MMA include BridgeBio Pharma, Inc., HemoShear Therapeutics, Inc., LogicBio, Poseida, and Moderna. Biopharmaceutical companies active in the research for IgA nephropathy include Omeros, Travere, Novartis, Ionis, Visterra, Chinook Therapeutics, Calliditas Therapeutics AB, Vera Therapeutics, and Eledon Pharmaceuticals. Biopharmaceutical companies active in autoimmune disease research include Calliditas Therapeutics AB, CymaBay, Genfit, and Intercept Pharmaceuticals. Large biopharmaceutical companies active in the IL-2 research include Abbvie, Inc., Amgen, Bristol Myers Squibb, Eli Lilly, Sanofi S.A., and Merck & Co., Inc.

Government Regulation

Government authorities in the United States, at the federal, state and local level, and in other countries extensively regulate, among other things, the research, development, testing, manufacturing, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting, marketing and export and import of products such as those we are developing.

SEL-212 is subject to regulation in the United States as a combination product. If marketed individually, each component would be subject to different regulatory pathways and would require approval of independent marketing applications by the FDA. A combination product, however, is assigned to a Center that will have primary jurisdiction over its regulation based on a determination of the combination product’s primary mode of action, which is the single mode of action that provides the most important therapeutic action. In the case of SEL-212, we believe that the primary mode of action is attributable to the biologic component of the product. In the case of SEL-212, which we believe will be regulated as a therapeutic biologic, the FDA’s Center for Drug Evaluation and Research, or CDER, will have primary jurisdiction over premarket development. We expect to seek approval of SEL-212 through a single BLA reviewed by CDER, and we do not expect that the FDA will require a separate marketing authorization for each constituent of SEL-212.

Biological products are subject to regulation under the Federal Food, Drug, and Cosmetic Act, or FD&C Act, and the Public Health Service Act, or PHS Act, and other federal, state, local and foreign statutes and regulations. SEL-212 and any other product candidates that we develop must be approved by the FDA before they may be legally marketed in the United States and by the appropriate foreign regulatory agency before they may be legally marketed in foreign countries.

U.S. biological products development process

The process required by the FDA before a biologic, including a gene therapy, may be marketed in the United States is summarized below.

Biological product candidates are preclinically tested before any testing is done in humans. These tests, or non-clinical studies, include laboratory evaluations of product chemistry, toxicity and formulation, as well as animal studies to assess the potential safety and activity of the product candidate. The conduct of the preclinical tests must comply with federal regulations and requirements including GLPs.

The clinical study sponsor must submit the results of the preclinical tests, together with manufacturing information, analytical data, any available clinical data or literature and a proposed clinical protocol, to the FDA as part of the IND which must become effective before human clinical trials may begin. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA places the clinical study on a clinical hold within that 30-day time period. In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical study can begin. The FDA may also impose clinical holds on a biological product candidate at any time before or during clinical trials due to safety concerns or non-compliance. If the FDA imposes a clinical hold, trials may not recommence without FDA authorization and then only under terms authorized by the FDA. In addition to these requirements, biological product candidates may also require evaluation and assessment by an institutional biosafety committee, or IBC, that reviews and oversees research utilizing recombinant or synthetic nucleic acid molecules at that institution.

Clinical trials are conducted under protocols detailing, among other things, the objectives of the clinical study, dosing procedures, patient selection and exclusion criteria, and the parameters to be used to monitor patient safety. Each protocol and

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any amendments to the protocol must be submitted to the FDA as part of the IND. Clinical trials must be conducted and monitored in accordance with the FDA’s regulations comprising the GCP requirements, including the requirement that all research subjects provide informed consent. Further, each clinical study must be reviewed and approved by an independent institutional review board, or IRB, at or servicing each institution at which the clinical study will be conducted. Human clinical trials are typically conducted in three sequential phases that may overlap or be combined:

•Phase 1.The biological product candidate is initially introduced into healthy human patients and tested for safety.

•Phase 2.The biological product candidate is evaluated in a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance, optimal dosage and dosing schedule.

•Phase 3.Clinical trials are undertaken to further evaluate dosage, clinical efficacy, potency, and safety in an expanded patient population at geographically dispersed clinical study sites. These clinical trials are intended to establish the overall risk/benefit ratio of the product and provide an adequate basis for product labeling.

Post-approval clinical trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval to gain additional experience from the treatment of patients in the intended therapeutic indication, particularly for long-term safety follow-up.

The FDA or the sponsor or its data safety monitoring board may suspend a clinical study at any time on various grounds. Similarly, an IRB can suspend or terminate approval of a clinical study at its institution if the clinical study is not being conducted in accordance with the IRB’s requirements or if the biological product candidate has been associated with unexpected serious harm to patients.

Sponsors of clinical trials of FDA-regulated products, including biologics, are also required to register and disclose certain clinical trial information, which is publicly available at www.clinicaltrials.gov. Concurrent with clinical trials, companies must also finalize a process for manufacturing the product in commercial quantities in accordance with GMP requirements.

After the completion of clinical trials of a biological product candidate, FDA approval of a BLA must be obtained before commercial marketing of the biological product. The BLA must include results of product development, laboratory and animal trials, human trials, information on the manufacture and composition of the product, proposed labeling and other relevant information. In addition, under the Pediatric Research Equity Act, or PREA, a BLA or supplement to a BLA must contain data to assess the safety and effectiveness of the biological product candidate 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 Food and Drug Administration Safety and Innovation Act, or FDASIA, requires that sponsors planning to submit a BLA for a biological product that in certain circumstances n submit an initial Pediatric Study Plan, or PSP, within sixty days after a Type C meeting or as may be agreed between the sponsor and FDA. Unless otherwise required by regulation, PREA does not apply to any biological product for an indication for which orphan designation has been granted.

Under the Prescription Drug Fee User Act, or PDUFA, as amended, each BLA must be accompanied by a user fee. Fee waiver or reductions are available under certain circumstances, including for the first application filed by a small business. In addition, no user fees are assessed on BLAs on products designated as orphan drugs unless the product also includes a non-orphan indication.

Within 60 days following submission of the application, the FDA reviews a BLA for completeness. The FDA may refuse to file any BLA that it deems incomplete or otherwise not reviewable and may request additional information. Once the submission is accepted for filing, the FDA substantively reviews the BLA to determine, among other things, whether the proposed product is safe, pure and potent, and manufactured in accordance with cGMP requirements. The FDA may refer applications for novel biological products or biological products that present difficult questions of safety or efficacy to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a non-binding recommendation on approval. During the biological product approval process, the FDA also will determine whether a Risk Evaluation and Mitigation Strategy, or REMS, is necessary to assure the safe use of the biological product candidate. If the FDA concludes a REMS is needed, the sponsor of the BLA must submit a proposed REMS; the FDA will not approve the BLA without a REMS, if required.

Before approving a BLA, the FDA will inspect the facilities in which the product is manufactured to determine whether the manufacturing processes and facilities are in compliance with GMPs. The FDA may also audit the clinical investigation sites to determine that they have complied with good clinical practices.

Notwithstanding the submission of relevant data and information, the FDA may ultimately deny approval. Data obtained from clinical trials are not always conclusive and the FDA may interpret data differently than the applicant interprets the same data. If the FDA denies approval of a BLA in its then-current form, the FDA will issue a complete response letter detailing deficiencies in the application. If a response letter is issued, the applicant may either resubmit the BLA, addressing all of the deficiencies identified in the letter, or withdraw the application.

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One of the performance goals agreed to by the FDA under PDUFA is to review 90% of standard BLAs in 10 months from the filing date and 90% of priority BLAs in six months from the filing date, whereupon a review decision is to be made. The FDA does not always meet its PDUFA goal dates for standard and priority BLAs.

Orphan Designation

Prior to the submission of a BLA, the FDA may grant orphan designation to drugs or biologics intended to treat a rare disease or condition that affects fewer than 200,000 individuals in the United States, or if it affects more than 200,000 individuals in the United States, there is no reasonable expectation that the cost of developing and marketing the product for this type of disease or condition will be recovered from sales in the United States 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.

In the United States, orphan designation entitles a party to financial incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and user-fee waivers. In addition, if a product receives the first FDA approval for the indication for which it has orphan designation, the product is entitled to orphan exclusivity, which means the FDA may not approve any other application to market the same product for the same indication for a period of seven years, except in limited circumstances, such as a showing of clinical superiority over the product with orphan exclusivity or where the manufacturer with orphan exclusivity is unable to assure sufficient quantities of the approve orphan product. Competitors, however, may receive approval of different products for the indication for which the orphan product has exclusivity or obtain approval for the same product but for a different indication for which the orphan product has exclusivity. Orphan product exclusivity also could block the approval of one of our products for seven years if a competitor obtains approval of the same biological product as defined by the FDA or if our product candidate is determined to be contained within the competitor’s product for the same indication or disease. If a drug or biological product designated as an orphan product receives marketing approval for an indication broader than what is designated, it may not be entitled to orphan product exclusivity.

Rare Pediatric Disease Designation

The Rare Pediatric Disease designation program allows for a sponsor who receives an approval for a product to potentially qualify for a voucher that can be redeemed to receive a priority review of a subsequent marketing application for a different product.

Expedited Development and Review Programs

The FDA has a Fast Track program that is intended to expedite or facilitate the process for reviewing new biological products that meet certain criteria. Specifically, new biological products are eligible for Fast Track designation if they are intended to treat a serious or life-threatening disease or condition and demonstrate the potential to address unmet medical needs for the disease or condition. Fast Track designation applies to the combination of the product and the specific indication for which it is being studied. The sponsor of a new biologic may request that the FDA designate the biologic as a Fast Track product at any time during the clinical development of the product.

Any product submitted to the FDA for marketing, including under a Fast Track program, may be eligible for other types of FDA programs intended to expedite development and review, such as priority review and accelerated approval. Any product is eligible for priority review if it treats a serious condition and, if approved, would provide a significant improvement in safety or effectiveness compared to marketed products. Additionally, a product may be eligible for accelerated approval. Biological products studied for their safety and effectiveness in treating serious or life-threatening illnesses and that provide meaningful therapeutic benefit over existing treatments may be eligible for accelerated approval, which means that they may be approved on the basis of studies establishing that the product has an effect on a surrogate endpoint that is reasonably likely to predict a clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments. As a condition of approval, the FDA may require that a sponsor of a biological product subject to accelerated approval perform adequate and well-controlled post-marketing clinical studies to confirm such benefit. In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch of the product. Fast Track designation, priority review and accelerated approval do not change the standards for approval but may expedite the development or approval process.

In addition, under the provisions of FDASIA, the FDA established a Breakthrough Therapy Designation which is intended to expedite the development and review of products that treat serious or life-threatening diseases or conditions. A breakthrough therapy is defined as a drug that is intended, alone or in combination with one or more other drugs, 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. The designation includes all of the features of Fast Track designation, as well as more intensive FDA interaction and guidance.

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Post-approval Requirements

Rigorous and extensive FDA regulation of biological products continues after approval, particularly with respect to cGMP requirements. Manufacturers of our products are required to comply with applicable requirements in the cGMP regulations, including quality control and quality assurance and maintenance of records and documentation. Other post-approval requirements applicable to biological products include record-keeping requirements, reporting of adverse effects and reporting updated safety and efficacy information.

We also must comply with the FDA’s advertising and promotion requirements, such as those related to direct-to-consumer advertising, the prohibition on promoting products for uses or in patient populations that are not described in the product’s approved labeling (known as “off-label use”), industry-sponsored scientific and educational activities and promotional activities involving the internet. Discovery of previously unknown problems or the failure to comply with the applicable regulatory requirements may result in restrictions on the marketing of a product or withdrawal of the product from the market as well as possible civil or criminal sanctions. Failure to comply may subject an applicant or manufacturer to administrative or judicial civil or criminal sanctions and adverse publicity.

Biosimilars and Exclusivity

The Patient Protection and Affordable Care Act, or ACA, includes a subtitle called the Biologics Price Competition and Innovation Act of 2009, or BPCIA, which created an abbreviated approval pathway for biological products that are biosimilar to or interchangeable with an FDA-licensed reference biological product.

Biosimilarity, which requires that there be no clinically meaningful differences between the biological product and the reference product in terms of safety, purity and potency, can be shown through analytical studies, animal studies and a clinical study or studies. However, complexities associated with the larger, and often more complex, structures of biological products, as well as the processes by which such products are manufactured, pose significant hurdles to implementation of the abbreviated approval pathway that are still being worked out by the FDA.

Under the BPCIA, an application for a biosimilar product may not be submitted to the FDA until four years following the date that the reference product was first licensed by the FDA. In addition, the approval of a biosimilar product may not be made effective by the FDA until 12 years from the date on which the reference product was first licensed. During this 12-year period of exclusivity, another company may still market a competing version of the reference product if the FDA approves a full BLA for the competing product containing the sponsor’s own preclinical data and data from adequate and well-controlled clinical trials to demonstrate the safety, purity and potency of their product.

A biological product can also obtain pediatric market exclusivity in the United States. 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 study in accordance with an FDA-issued “Written Request” for such a study.

The BPCIA is complex and continues to be interpreted and implemented by the FDA. As a result, the ultimate impact, implementation and meaning of the BPCIA is subject to significant uncertainty.

Government Regulation Outside of the United States

Whether or not we obtain FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in foreign countries prior to the commencement of clinical studies or marketing of the product in those countries.

The requirements and process governing the conduct of clinical studies, product licensing, pricing and reimbursement vary from country to country. In all cases, the clinical studies are conducted in accordance with GCP and the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki.

In the European Economic Area, or EEA, which is composed of the 27 member states of the European Union plus Norway, Iceland and Liechtenstein medicinal products can only be commercialized after obtaining a Marketing Authorization, or MA.

There are two types of MAs.

•The Community MA, which is issued by the European Commission through the Centralized Procedure, based on the opinion of the Committee for Medicinal Products for Human Use, or CHMP, of the European Medicines Agency, or EMA, and which is valid throughout the entire territory of the EEA. The Centralized Procedure is mandatory for certain types of products, such as biotechnology medicinal products, orphan medicinal products, advanced therapy medicinal products (such as gene therapy, somatic cell therapy and tissue engineered products), among others. The Centralized Procedure is optional for products containing a new active substance not yet authorized in the EEA, or for products that constitute a significant therapeutic, scientific or technical innovation or which are in the interest of public health in the EU. Under the Centralized Procedure the maximum timeframe for the evaluation of a marketing authorization application is 210 days (excluding clock stops, when additional written or oral information is to be provided by the applicant in response to questions asked by the CHMP). Accelerated evaluation might be granted by

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the CHMP in exceptional cases. Under the accelerated procedure the standard 210 days review period is reduced to 150 days.

•National MAs, which are issued by the competent authorities of the Member States of the EEA and only cover their respective territory, are available for products not falling within the mandatory scope of the Centralized Procedure. Where a product has already been authorized for marketing in a Member State of the EEA, this National MA can be recognized in another Member States through the Mutual Recognition Procedure. If the product has not received a National MA in any Member State at the time of application, it can be approved simultaneously in various Member States through the Decentralized Procedure.

To obtain regulatory approval of an investigational biological product under European Union regulatory systems, we must submit a marketing authorization application, which is similar to the U.S. BLA. The European Union also provides opportunities for market exclusivity. Upon receiving marketing authorization, new chemical entities generally receive eight years of data exclusivity, which prevents regulatory authorities in the European Union from referencing the innovator’s data to assess a generic or biosimilar application, and an additional two years of market exclusivity, during which no generic or biosimilar product can be marketed. However, there is no guarantee that a product will be considered by the European Union’s regulatory authorities to be a new chemical entity, and products may not qualify for data exclusivity. Products receiving orphan designation in the European Union can receive ten years of market exclusivity, during which time no marketing authorization application shall be accepted, and no marketing authorization shall be granted for a similar medicinal product for the same indication. An orphan product can also obtain an additional two years of market exclusivity in the European Union for pediatric studies. No extension to any supplementary protection certificate can be granted on the basis of pediatric studies for orphan indications.

The criteria for designating an “orphan medicinal product” in the European Union are similar in principle to those in the United States. Under Article 3 of Regulation (EC) 141/2000, a medicinal product may be designated as orphan if (1) it is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition; (2) either (a) such condition affects no more than five in 10,000 persons in the European Union when the application is made, or (b) the product, without the benefits derived from orphan status, would not generate sufficient return in the European Union to justify investment; and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the European Union, or if such a method exists, the product will be of significant benefit to those affected by the condition, as defined in Regulation (EC) 847/2000. Orphan medicinal products are eligible for certain financial and exclusivity incentives.

For other countries outside of the European Union, such as countries in Eastern Europe, Latin America or Asia, the requirements governing the conduct of clinical studies, product licensing, pricing and reimbursement vary from country to country. In all cases, again, the clinical studies are conducted in accordance with GCP and the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki.

When conducting clinical trials in the EU, we must adhere to the provisions of the European Union Clinical Trials Directive (Directive 2001/20/EC) and the laws and regulations of the EU Member States implementing them. These provisions require, among other things, that the prior authorization of an Ethics Committee and the competent Member State authority is obtained before commencing the clinical trial. In 2014, the EU passed the Clinical Trials Regulation (Regulation 536/2014), which will replace the current Clinical Trials Directive, to ensure that the rules for clinical trials are identical throughout the European Union.

We are also subject to data privacy and security laws in the jurisdictions outside of the U.S. in which we are established, run clinical trials or in which we sell or market our products once approved. For example, in Europe we are subject to Regulation (EU) 2016/679 (General Data Protection Regulation or GDPR) in relation to our collection, control, processing and other use of personal data (i.e. data relating to an identifiable living individual). We process personal data in relation to participants in our clinical trials in the EEA., including the health and medical information of these participants. The GDPR is directly applicable in each E.U. Member State, however, it provides that E.U. Member States may introduce further conditions, including limitations which could limit our ability to collect, use and share personal data (including health and medical information), or could cause our compliance costs to increase, ultimately having an adverse impact on our business. The GDPR imposes accountability and transparency obligations regarding personal data. We are also subject to E.U. rules with respect to cross-border transfers of personal data out of the E.U. and EEA. We are subject to the supervision of local data protection authorities in those E.U. jurisdictions where we are established or otherwise subject to the GDPR. A breach of the GDPR could result in significant fines, regulatory investigations, reputational damage, orders to cease/ change our use of data, enforcement notices, as well potential civil claims including class action type litigation where individuals suffer harm. Moreover, the United Kingdom leaving the E.U. could also lead to further legislative and regulatory changes. It remains unclear how the United Kingdom data protection laws or regulations will develop in the medium to longer term and how data transfer to the United Kingdom from the E.U. will be regulated. However, the United Kingdom has transposed the GDPR into domestic law with the Data Protection Act 2018, which remains in force following the United Kingdom’s departure from the EU.

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Other Healthcare Laws

The federal Anti-Kickback Statute prohibits, among other things, any person or entity from knowingly (regardless of knowledge of this specific statute) and willfully offering, paying, soliciting, receiving or providing any remuneration, directly or indirectly, overtly or covertly, to induce or in return for purchasing, leasing, ordering, or arranging for or recommending the purchase, lease, or order of any item or service reimbursable, in whole or in part, under Medicare, Medicaid or other federal healthcare programs. The term “remuneration” has been broadly interpreted to include anything of value. The Anti-Kickback Statute has been interpreted to apply to arrangements between pharmaceutical manufacturers on the one hand and prescribers, purchasers and formulary managers on the other. The majority of states also similar have anti-kickback laws, which in some cases are more restrictive.

The federal false claims and civil monetary penalties laws, including the civil False Claims Act, prohibit any person or entity from, among other things, knowingly presenting, or causing to be presented, a false, fictitious or fraudulent claim for payment to, or approval by, the federal government or knowingly making, using, or causing to be made or used a false record or statement material to a false or fraudulent claim to the federal government, or from knowingly making a false statement to avoid, decrease or conceal an obligation. A claim includes “any request or demand” for money or property presented to the U.S. government. Violation of the federal Anti-Kickback Statute may also constitute a false or fraudulent claim for purposes of the federal civil False Claims Act. Actions under the civil False Claims Act may be brought by the Department of Justice or as a qui tam action by a private individual in the name of the government. Violations of the civil False Claims Act can result in very significant monetary penalties and treble damages, and may be accompanied by additional civil monetary penalties against individuals. Many states also have similar fraud and abuse statutes or regulations that apply to items and services reimbursed under Medicaid and other state programs, or, in several states, apply regardless of the payor.

The federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, prohibits, among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services. A person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

In addition, there has been a recent trend of increased federal and state regulation of payments made to physicians and certain other healthcare providers. The ACA imposed, among other things, new annual reporting requirements through the Physician Payments Sunshine Act for covered manufacturers for certain payments and “transfers of value” provided to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other health care professionals beginning in 2022, and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.

We may also be subject to data privacy and security regulation by both the federal government and the states in which we conduct our business. HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, or HITECH, and their respective implementing regulations, impose specified requirements relating to the privacy, security and transmission of individually identifiable health information held by covered entities and their business associates. Among other things, HITECH made HIPAA’s security standards directly applicable to, as well as imposed certain other privacy obligations on, “business associates,” defined as independent contractors or agents of covered entities that create, receive, maintain or transmit protected health information in connection with providing a service for or on behalf of a covered entity. HITECH also increased the civil and criminal penalties that may be imposed and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorney’s fees and costs associated with pursuing federal civil actions. Even when HIPAA does not apply, according to the Federal Trade Commission or the FTC, failing to take appropriate steps to keep consumers’ personal information secure constitutes unfair acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act, or the FTCA, 15 U.S.C § 45(a).

Coverage and Reimbursement

Significant uncertainty exists as to the coverage and reimbursement status of any pharmaceutical or biological products for which we obtain regulatory approval. In the United States and markets in other countries, patients who are prescribed treatments for their conditions and providers performing the prescribed services generally rely on third-party payors to reimburse all or part of the associated healthcare costs. Sales of any products for which we receive regulatory approval for commercial sale will therefore depend, in part, on the availability of coverage and adequate reimbursement from third-party payors. Third-party payors include government authorities, managed care plans, private health insurers and other organizations.

The process for determining whether a third-party payor will provide coverage for a pharmaceutical or biological product typically is separate from the process for setting the price of such product or for establishing the reimbursement rate that the payor will pay for the product once coverage is approved. Third-party payors may limit coverage to specific products on an approved list, also known as a formulary, which might not include all of the FDA-approved products for a particular indication.

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A decision by a third-party payor not to cover our product candidates could reduce physician utilization of our products once approved and have a material adverse effect on our sales, results of operations and financial condition. Moreover, a third-party payor’s decision to provide coverage for a pharmaceutical or biological product does not imply that an adequate reimbursement rate will be approved. Adequate third-party reimbursement may not be available to enable us to maintain price levels sufficient to realize an appropriate return on our investment in product development.

Healthcare Reform

A primary trend in the U.S. healthcare industry and elsewhere is cost containment. Government authorities and other third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medical products.

In addition, other legislative changes have been proposed and adopted in the United States since the ACA was enacted. This included aggregate reductions of Medicare payments to providers of 2% per fiscal year, which went into effect on April 1, 2013, and, due to subsequent legislative amendments, will stay in effect through 2027 unless additional Congressional action is taken. On January 2, 2013, the American Taxpayer Relief Act was signed into law, which, among other things, further reduced Medicare payments to several providers, including hospitals and imaging centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. Recently there has also 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 and enacted legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies.

Human Capital Resources

At Selecta Biosciences, we consider human capital to be an essential driver of our business and successful strategy creation and execution. Our people, driven by our Collaborative, Pioneering, and Patient Focused culture, propel our business forward, strengthening us for long-term success.

As of December 31, 2022, we had 64 employees, 47 of whom are primarily engaged in research and development activities and 17 in corporate functions. 61% of our employees have at least one of a Masters, PhD, or MD degree. Our 2022 annualized voluntary turnover rate was 9.82%. All employees reside and work in the United States and are not represented by a labor union. We consider our employee relations to be strong and in good standing.

Our goal is to continually engage our talented and diverse workforce to drive value creation both for our business and ultimately our patient populations. We believe in a proactive approach to talent management focusing on retention of key talent, critical role successor identification, and impactful employment development. Additional priority areas intended to drive engagement include successful recruitment of diverse talent, continual promotion of professional development at all levels, introduction, and evolution of business-friendly HR solutions, coupled with an intentional culture dialog aimed to drive a high engagement, high performance, patient centric culture.

To further drive attraction and retention of our high-quality, experienced, and diverse workforce, we invest in the physical, emotional, and financial well-being of our employees. These investments include a competitive mix of compensation and generous insurance benefits. To assist employees with the rising cost of healthcare, we pay 100% of an employee’s deductible and co-insurance payments. All employees are eligible to participate in our equity compensation programs. All employees are awarded new hire equity and annual equity as well as the opportunity to participate in our Employee Stock Purchase Plan. Employees are also eligible to receive an annual cash bonus and to participate in a 401(k) retirement plan with an industry competitive company match.

Available Information

We file electronically with the SEC our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and other information. Our SEC filings are available to the public over the Internet at the SEC's website at http://www.sec.gov. We make available on our website at www.selectabio.com, free of charge, copies of these reports as soon as reasonably practicable after filing or furnishing these reports with the SEC. The hyperlink to our website is included as an inactive textual reference only, and the information on our website is not incorporated by reference in this Annual Report on Form 10-K or in any other filings we make with the SEC.

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RISK FACTORS SUMMARY

Investing in our common stock involves various risks. You should carefully read and consider the matters discussed in this Annual Report under the heading “Risk Factors,” which include the following risks:

•We are a clinical-stage company and have incurred significant losses since our inception. We expect to incur losses for the foreseeable future and may never achieve or maintain profitability.

•We will need substantial additional funding in order to complete development of our product candidates and commercialize our products, if approved.

•The terms of our credit facility place restrictions on our operating and financial flexibility.

•Our product candidates are based on our ImmTOR platform, which is an unproven approach designed to induce antigen-specific immune tolerance to biologic drugs.

•Regulatory authorities in the United States and European Union have limited experience in reviewing and approving gene therapy products.

•Clinical drug development involves a lengthy and expensive process, with an uncertain outcome.

•The COVID-19 pandemic may continue to adversely impact our business, including sourcing raw materials and supplies to produce our product candidates, our preclinical studies and clinical trials.

•Geopolitical events, instability and wars can adversely affect both our clinical operations and supply chains that we rely on to advance our drug candidates.

•We rely on 3SBio in China as our primary supplier of pegadricase and on other third parties for the manufacture of our product candidates for preclinical and clinical testing, and expect to continue to do so for the foreseeable future.

•We rely, and expect to continue to rely, on third parties to conduct our clinical trials, and those third parties may not perform satisfactorily, including by failing to meet deadlines for the completion of such trials.

•If we or our licensors are unable to adequately protect our proprietary technology, or obtain and maintain issued patents that are sufficient to protect our product candidates, others could compete against us more directly, which would negatively impact our business.

•We may suffer from effects of macroeconomic instability and inflation.

•We would be reliant on Sobi to execute the marketing and sale of SEL-212, if SEL-212 were approved.

•We may not have the funds necessary to fulfill our obligation to repurchase certain warrants.

•We have been in the past and may in the future be subject to securities class action lawsuits.

Item 1A. Risk Factors

Investing in our common stock involves a high degree of risk. You should consider carefully the risks described below, together with the other information included or incorporated by reference in this Annual Report. If any of the following risks occur, our business, financial condition, results of operations and future growth prospects could be materially and adversely affected. In these circumstances, the market price of our common stock could decline. Other events that we do not currently anticipate or that we currently deem immaterial may also affect our business, prospects, financial condition and results of operations.

Risks Related to the Development of our Product Candidates

Our product candidates are based on our ImmTOR platform, which is an unproven approach designed to induce antigen-specific immune tolerance to biologic drugs. We are very early in most of our clinical development efforts and may not be successful in our efforts to use our ImmTOR platform to build a pipeline of product candidates and develop marketable drugs.

All of our product candidates are derived from our ImmTOR platform, which is an unproven approach to induce antigen-specific immune tolerance and to mitigate the immunogenicity of biologic therapies currently being implemented to treat patients. We are developing our ImmTOR platform to restore self-tolerance to autoantigens and potentially treat autoimmune diseases, to be co-administered with AAV gene therapies to potentially enable redosing of said gene therapies and improve and enable activity in biologics (including therapeutic enzymes and other immunogenic drugs).

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While we have completed our early development clinical trials and a Phase 2 clinical trial for SEL-212, we have not completed a clinical trial for any other product candidate, nor have we demonstrated our ability to successfully complete any Phase 3 or other pivotal clinical trials, obtain regulatory approvals, manufacture a commercial product, or arrange for a third party to do so on our behalf, or conduct other sales and marketing activities necessary for successful product commercialization. We may have problems identifying new product candidates and applying our technologies to these other areas. Even if we are successful in identifying new product candidates, they may not be suitable for clinical development, including as a result of harmful side effects, limited efficacy or other characteristics that indicate that they are unlikely to be products that will receive marketing approval and achieve market acceptance. The success of our product candidates will depend on several factors, including the following:

•design, initiation and completion of preclinical studies and clinical trials with positive results;

•reliance on third parties, including but not limited to collaborators, licensees, clinical research organizations and contract manufacturing organizations;

•receipt of marketing approvals from applicable regulatory authorities;

•obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our product candidates and not infringing or violating patents or other intellectual property of third parties;

•making arrangements with third-party manufacturers for, or establishing, commercial manufacturing capabilities, or establishing such capabilities ourselves;

•launching commercial sales of our products, if and when approved, whether alone or in collaboration with others;

•acceptance of our products, if and when approved, by patients and the medical community;

•effectively competing with other therapies;

•obtaining and maintaining coverage and adequate reimbursement by third-party payors, including government payors, for our products, if approved;

•maintaining an acceptable safety profile of our products following approval; and

•maintaining and growing an organization of scientists and business people who can develop and commercialize our product candidates and technology.

The occurrence of any of the foregoing would effectively prevent or delay approval of our lead and other product candidates. The ongoing COVID-19 pandemic may continue to adversely impact our business, including our preclinical studies and clinical trials.

We are applying our ImmTOR platform to antigen-specific immune tolerance for gene therapy involving gene augmentation, replacement or editing. Regulatory authorities in the United States and European Union have limited experience in reviewing and approving gene therapy products, which could affect the time and data required to obtain marketing authorization of any of our product candidates.

Our future success depends in part on our successful development of viable gene therapy product candidates utilizing our ImmTOR platform.

The regulatory approval process for gene therapy product candidates can be more lengthy, rigorous and expensive than the process for other better known or more extensively studied product candidates and technologies. Since we are developing novel treatments for diseases in which there is little clinical experience with new endpoints and methodologies, there is heightened risk that the FDA, the European Medicines Agency, or the EMA, or comparable regulatory bodies may not consider the clinical trial endpoints to provide clinically meaningful results, and the resulting clinical data and results may be more difficult to analyze. This may be a particularly significant risk for many of the genetically defined diseases for which we may develop product candidates alone or with collaborators due to small patient populations for those diseases, and designing and executing a rigorous clinical trial with appropriate statistical power is more difficult than with diseases that have larger patient populations. Regulatory agencies administering existing or future regulations or legislation may not allow production and marketing of products utilizing genome editing technology in a timely manner or under technically or commercially feasible conditions. Even if our product candidates obtain required regulatory approvals, such approvals may later be withdrawn as a result of changes in regulations or the interpretation of regulations by applicable regulatory agencies.

Changes in applicable regulatory guidelines may lengthen the regulatory review process for our product candidates, require additional studies or trials, increase development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of such product candidates, or lead to significant post-approval limitations or restrictions. Additionally, adverse developments in clinical trials conducted by others of gene therapy products or products created using genome editing technology, or adverse public perception of the field of genome editing, may cause the FDA, the EMA and other regulatory bodies to revise the requirements for approval of any product candidates we may develop or limit the

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use of products utilizing genome editing technologies, either of which could materially harm our business. Furthermore, regulatory action or private litigation could result in expenses, delays or other impediments to our research programs or the development or commercialization of current or future product candidates.

Even if we comply with applicable laws, rules, and regulations, and even if we maintain close coordination with the applicable regulatory authorities with oversight over our product candidates, our development programs may fail to succeed. Regulatory authorities have substantial discretion in the approval process and may refuse to accept a marketing application as deficient or may decide that our data is insufficient for approval and require additional preclinical, clinical or other studies. In addition, varying interpretations of the data obtained from preclinical and clinical testing could delay, limit or prevent marketing approval of a product candidate. Additionally, adverse developments in clinical trials conducted by others of gene therapy products or products created using genome editing technology, or adverse public perception of the field of genome editing, may cause the FDA and other regulatory bodies to revise the requirements for approval of any product candidates we may develop or limit the use of products utilizing genome editing technologies, either of which could materially harm our business. Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential product to market would materially and adversely affect our business, financial condition, results of operations and prospects.

Clinical drug development involves a lengthy and expensive process, with an uncertain outcome. We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of our product candidates.

Except for SEL-212 and SEL-302, our product candidates are in preclinical development. It is impossible to predict when or if any of our product candidates will prove effective and safe in humans or will receive regulatory approval, and the risk of failure through the development process is high. Before obtaining marketing approval from regulatory authorities for the sale of any product candidate, we must complete preclinical development and then conduct extensive clinical trials to demonstrate the safety and efficacy of our product candidates in humans. Preclinical development is costly and inherently uncertain. Early preclinical results may not be predictive of future results, however, if our technology proves to be ineffective or unsafe as a result of, among other things, adverse side effects, pre-existing anti-drug antibodies that can neutralize the viral vector and block gene transfer, or cellular immune response to the transduced cells, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the clinical development and commercialization of our product candidates.

Before obtaining marketing approval from regulatory authorities for the sale of our product candidates, we must conduct extensive clinical trials to demonstrate the safety and efficacy of the product candidate for its intended indications. Clinical testing is expensive, difficult to design and implement, can take many years to complete and its outcome is inherently uncertain. A failed clinical trial can occur at any stage of testing. Moreover, the outcome of preclinical testing and early clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results. For example, the topline clinical trial results we reported from our Phase 2 head-to-head COMPARE study of SEL-212 and the top-line data from our SEL-399 program may not be predictive of future results. Moreover, we may not be able to complete, or may be required to deviate from the current clinical trial protocol for a variety of reasons.

Many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in clinical trials after achieving positive results in preclinical development or early-stage clinical trials, and we cannot be certain that we will not face similar setbacks. SAEs caused by, or other unexpected properties of, any product candidates that we may choose to develop could cause us, an institutional review board or regulatory authority to interrupt, delay or halt clinical trials of one or more of such product candidates and could result in a more restrictive label or the delay or denial of marketing approval by the FDA or comparable non-U.S. regulatory authorities. If any product candidate that we may choose to develop is associated with SAEs or other unexpected properties, we may need to abandon development or limit development of that product candidate to certain uses or subpopulations in which those undesirable characteristics would be expected to be less prevalent, less severe or more tolerable from a risk-benefit perspective. In the SEL-212 Phase 1/2 clinical program, we have observed multiple SAEs, and future SAEs may occur causing us to incur additional costs or experience delays in completing, or causing us to ultimately be unable to complete, the development and commercialization of our product candidates, and delay or prevent our ability to obtain FDA approval. Moreover, preclinical and clinical data is often susceptible to varying interpretations and analyses, and many companies that believed their product candidates performed satisfactorily in preclinical studies and clinical trials nonetheless failed to obtain FDA or other regulatory authority approval. If we fail to produce positive results in clinical trials of our product candidates, the development timeline and regulatory approval and commercialization prospects for our product candidates, and, correspondingly, our business and financial prospects, would be negatively impacted.

In addition, we cannot be certain as to what type and how many clinical trials the FDA will require us to conduct before we may gain regulatory approval to market any of our product candidates in the United States or other countries, if any. Prior to approving a new therapeutic product, the FDA generally requires that safety and efficacy be demonstrated in two adequate and well-controlled clinical trials.

We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval for, or commercialize, our product candidates, including:

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•clinical trials of our product candidates may produce unfavorable, incomplete or inconclusive results;

•regulators or institutional review boards may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site or may place a clinical hold on existing clinical trials;

•we may experience delays in reaching, or fail to reach, agreement on acceptable terms with contract research organizations, or CROs, or clinical trial sites;

•we may be unable to recruit suitable patients to participate in a clinical trial, the number of patients required for clinical trials of our product candidates may be larger than we expect, enrollment in these clinical trials may be slower than we expect or participants may drop out of these clinical trials at a higher rate than we expect, or enrollment could be affected by the ongoing COVID-19 pandemic or the ongoing conflict in Ukraine;

•the number of clinical trial sites required for clinical trials of our product candidates may be larger than we expect;

•our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all;

•we may have to suspend or terminate clinical trials of our product candidates for various reasons, including a finding that the participants are being exposed to unacceptable health risks;

•investigators, regulators, data safety monitoring boards or institutional review boards may require that we or our investigators suspend or terminate clinical research, or we may decide to do so ourselves;

•investigators may deviate from the trial protocol, fail to conduct the trial in accordance with regulatory requirements or misreport study data;

•the cost of clinical trials of our product candidates may be greater than we expect or we may have insufficient resources to pursue or complete certain aspects of our clinical trial programs or to do so within the timeframe we planned;

•the supply or quality of raw materials or manufactured product candidates (whether provided by us or third parties) or other materials necessary to conduct clinical trials of our product candidates may be insufficient, inadequate or not available at an acceptable cost, or in a timely manner, or we may experience interruptions in supply;

•regulators may revise the requirements for approving our product candidates, or such requirements may not be as we expect;

•the FDA or comparable foreign regulatory authorities may disagree with our clinical trial design or our interpretation of data from preclinical studies and clinical trials, or may change the requirements for approval even after it has reviewed and commented on the design of our clinical trials;

•regarding trials managed by our existing or any future collaborators, our collaborators may face any of the above issues, and may conduct clinical trials in ways they view as advantageous to them but potentially suboptimal for us; and

•geopolitical events may affect international and overseas trial sites in ways beyond our control.

If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, or if we are forced to delay or abandon certain clinical trials or other testing in order to conserve capital resources, we may:

•be delayed in obtaining marketing approval for our product candidates, if at all;

•lose the support of collaborators, requiring us to bear more of the burden of research and development;

•obtain marketing approval in some countries and not in others;

•obtain approval for indications or patient populations that are not as broad as intended or desired;

•obtain approval with labeling that includes significant use or distribution restrictions or safety warnings;

•be subject to additional post-marketing testing requirements; or

•have a product removed from the market after obtaining marketing approval.

We could also encounter delays if a clinical trial is suspended or terminated. Authorities may impose such a suspension or termination due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or comparable foreign regulatory authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a

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benefit from using a drug, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial. In addition, changes in regulatory requirements and policies may occur, and we may need to amend clinical trial protocols to comply with these changes. Amendments may require us to resubmit our clinical trial protocols to IRBs for reexamination, which may impact the costs, timing or successful completion of a clinical trial.

We filed an IND to conduct a Phase 1/2 clinical trial of our SEL-302 product candidate in pediatric patients with methylmalonic acidemia in the third quarter of 2021. ImmTOR manufacturing continues to proceed in accordance with our expectations, and we have not observed any impact to any of our ImmTOR programs.

Our product development costs will increase if we experience delays in clinical testing or in obtaining marketing approvals. We do not know whether any of our preclinical studies or clinical trials will begin as planned, will need to be restructured or will be completed on schedule, or at all. Significant preclinical or clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before we do, potentially impairing our ability to successfully commercialize our product candidates and harming our business and results of operations.

If we experience delays or difficulties in the enrollment of patients in clinical trials, our receipt of necessary regulatory approvals could be delayed or prevented.

We may not be able to initiate or continue clinical trials for our product candidates if we are unable to locate and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or similar regulatory authorities outside the United States. In addition, from time to time our competitors have ongoing clinical trials for product candidates that treat the same indications as our product candidates, and patients who would otherwise be eligible for our clinical trials may instead enroll in clinical trials of our competitors’ product candidates. The safety of our patients and investigators continues to be our utmost priority. Our inability to enroll a sufficient number of patients for our clinical trials would result in significant delays and could require us to abandon one or more clinical trials altogether. Enrollment delays in our clinical trials may result in increased development costs for our product candidates, which could cause the value of our common stock to decline and limit our ability to obtain additional financing.

We may conduct clinical trials for product candidates at sites outside the United States, and the FDA may not accept data from trials conducted in such locations or the complexity of regulatory burdens may otherwise adversely impact us.

RNAC US Equity

RNAC · 10-K · period ended 2022-12-31

Item 1. Business

Item 1A. Risk Factors

RNAC US Equity☆

RNAC · 10-K · period ended 2022-12-31

Item 1. Business

Item 1A. Risk Factors

RNAC US Equity