RISK FACTORS 4 • delays in reaching a consensus with the FDA, EMA or regulatory to successfully commercialize our product candidates and may authorities on trial design; harm our business, financial conditions, results of operations and • delays in reaching agreement on acceptable terms with prospects. prospective CROs and clinical trial sites; If clinical trials of our product candidates fail to satisfactorily • delays in opening clinical trial sites or obtaining required demonstrate safety and efficacy to the EMA, FDA and other independent IRB approval in the United States or approval by regulators, we may incur additional costs or experience delays in an independent ethics committee in the European Union at completing, or ultimately be unable to complete, the development each clinical trial site; and commercialization of these product candidates. • delays in recruiting suitable patients to participate in our clinical The results of preclinical testing and clinical trials are very trials; unpredictable, and we cannot assure you that our clinical trials • imposition of a clinical hold by regulatory authorities, including will satisfactorily demonstrate safety and efficacy. If the results of as a result of a serious adverse event or after a negative finding our clinical trials are inconclusive or if there are safety concerns or following an inspection of our clinical trial operations or clinical serious adverse events associated with our product candidates, trial sites; we may: • failure by us, any CROs we engage or any other third parties to • be delayed in obtaining marketing approval for our product adhere to clinical trial requirements; candidates, if at all; • failure to perform in accordance with Good Clinical Practices, • obtain approval for indications or patient populations that are or GCP, or applicable regulatory requirements in the United not as broad as intended or desired; States, the European Union or other international markets; • obtain approval with labeling that includes significant use or • delays in the testing, validation, manufacturing and delivery of distribution restrictions or safety warnings; our product candidates to the clinical trial sites, including delays • be subject to changes in the way the product is administered; by any third parties with whom we have contracted to perform certain of those functions; • be required to perform additional clinical trials to support • delays in having patients complete a trial or return for post- approval or be subject to additional post-marketing testing treatment follow-up; requirements; • clinical trial sites or patients dropping out of a clinical trial; • have regulatory authorities withdraw, or suspend, their approval of the product or impose restrictions on its distribution • selection of clinical endpoints that require prolonged periods of in the form of a modified risk evaluation and mitigation strategy, clinical observation or analysis of the resulting data; or REMS; • the occurrence of serious adverse events associated with the • be subject to the addition of labeling statements such as product candidate that are viewed to outweigh its potential warnings or contraindications; benefits; • be sued; or • the occurrence of serious adverse events in clinical trials of the same class of agents conducted by other sponsors; and • experience damage to our reputation. • changes in regulatory requirements and guidance that require For example, following our meetings with the FDA in April and amending or submitting new clinical protocols. December 2016, the FDA requested that we undertake our REFLECT Phase I I I trial under a special protocol assessment to We do not know whether any of our preclinical studies or clinical provide primary evidence of effectiveness in bilateral treatment trials will begin as planned, will need to be restructured or will of LHON subjects and we initiated this trial in 2018. If the top-line be completed on schedule, or at all. Any inability to successfully results of the RESCUE and REVERSE trials are positive, we intend complete preclinical and clinical development could result in to meet with the FDA and apply for Fast Track Designation, which, additional costs or impair our ability to generate revenues from if granted, would allow us to file a BLA and seek an accelerated product sales, regulatory and commercialization milestones and approval pathway, while we continue to conduct our REFLECT royalties. In addition, if we make manufacturing or formulation trial. However, we cannot assure you that our RESCUE or changes to our product candidates, we may need to conduct REVERSE clinical trials will satisfactorily demonstrate safety and additional studies to bridge our modified product candidates to efficacy or that the FDA will grant our application for Fast Track earlier versions. Clinical trial delays also could shorten any periods Designation or support our filing of a BLA. during which we may have the exclusive right to commercialize our product candidates or al low our competitors to bring Our development costs wil l increase if we are unable to products to market before we do, which could impair our ability satisfactorily demonstrate safety and efficacy to the applicable 24 – GENSIGHT BIOLOGICS – 2017 Registration Document