RISK FACTORS 4 European Union. Because of the orphan nature of LHON and RP, delay, terminate or collaborate with third parties with respect to we believe a targeted sales and marketing organization would be some of our product development programs may also prove not able to reach specialized ophthalmology centers and their patients to be optimal and could cause us to miss valuable opportunities. If in the United States. If GS010 is approved, we plan to deploy a we do not accurately evaluate the commercial potential or target similar commercialization strategy in the European Union. With market for a particular product candidate, we may relinquish respect to GS030, we are currently starting a Phase I/I I clinical valuable rights to that product candidate through collaboration, trial. If we progress through to completion of clinical trials, and arelicensing or other arrangements in cases in which it would have successful, while we intend to retain the option to commercialize been more advantageous for us to retain sole development and GS030 by ourselves, due to the broader patient populations that commercialization rights. If we make incorrect determinations GS030 may address, we may enter into strategic partnerships to regarding the market potential of our product candidates or maximize the commercial value of GS030. misread trends in the pharmaceutical industry, our business While we intend to initially focus on commercializing our product prospects could be harmed. candidates in the United States and/or the European Union, we The success of our business currently depends primarily upon expect that we will be subject to additional risks in commercializing our ability to identify, develop and commercialize our lead our product candidates outside the United States or the European product candidates, GS010 and GS030, as wel l as to identify Union if we choose to do so, including: other product candidates based on our MTS and optogenetics • different regulatory requirements for approval of drugs and technology platforms. However, we may be unsuccessful biologics from country to country; in identifying potential product candidates for development. • reduced protection for intellectual property rights; Alternatively, our potential product candidates may be shown to have harmful side effects or other characteristics that could • unexpected changes in tariffs, trade barriers and regulatory make the products unmarketable or unlikely to receive marketing requirements; approval. If we are forced to abandon our development efforts for • economic weakness, including inflation, or political instability in a program or programs, this would likely have a material adverse particular other economies and markets; effect on our business and could potentially cause us to cease • compliance with tax, employment, immigration and labor laws operations. for employees living or traveling abroad; Our future success depends on our ability to retain key employees, • other currency fluctuations, which could result in increased consultants and advisors and to attract, retain and motivate operating expenses and reduced revenues, and other qualified personnel, and members of our management team may obligations incident to doing business in another country; be affected by conflicts of interest to the extent that they serve in • production shortages resulting from any events affecting raw management or directorship capacities at our competitors. material supply or manufacturing capabilities abroad; and • business interruptions resulting from natural disasters including We are highly dependent on members of our executive team, the earthquakes, typhoons, floods and fires. loss of whose services may adversely impact the achievement of our objectives. While we have entered into employment agreements with each of our executive officers, any of them could 4.6 leave our employment at any time, as all of our employees are “at will” employees. We currently do not have “key person” insurance RISKS RELATED TO OUR BUSINESS OPERATIONS on any of our employees. The loss of the services of one or more We may not be successful in our efforts to identify or discover of our current employees might impede the achievement of our additional product candidates and may fail to capitalize on research, development and commercialization objectives. programs or product candidates that may be a greater commercial Recruiting and retaining other qualified employees, consultants opportunity or for which there is a greater likelihood of success. and advisors for our business, including scientific and technical Because we have limited resources and access to capital to fund personnel, will also be critical to our success. There is a shortage our operations, we must decide which product candidates to of skilled individuals with substantial gene therapy experience, pursue and the amount of resources to al locate to each. Our which is likely to continue. As a result, competition for skil led decisions concerning the allocation of research, collaboration, personnel, including the area of gene therapy research and vector management and financial resources towards particular manufacturing, is intense and the turnover rate can be high. We product candidates may not lead to the development of viable may not be able to attract and retain personnel on acceptable commercial products and may divert resources away from more terms given the competition among numerous pharmaceutical promising opportunities. Similarly, our potential decisions to and biotechnology companies and academic institutions for GENSIGHT BIOLOGICS – 2017 Registration Document– 37