RISK FACTORS 4 individuals with similar skill sets. In addition, failure to succeed in information technology systems and facilities currently in place preclinical studies or clinical trials or applications for marketing may not be adequate to support this future growth. Our need approval may make it more chal lenging to recruit and retain to effectively manage our operations, growth and product qualified personnel. The inability to recruit, or the loss of services candidates wil l require us to continue to develop more robust of certain executives, key employees, consultants or advisors, business processes and to improve our systems and procedures may impede the progress of our research, development and in each of these areas, and to recruit, train and retain sufficient commercialization objectives and could have a material adverse numbers of qualified personnel. We may be unable to successfully effect on our business, financial condition, results of operations implement these tasks on a larger scale. Any inability to manage and prospects. growth could delay or prevent the execution of our research, development and growth plans or disrupt our operations, and In addition, members of our management team have served, have a material adverse effect on our business. and may in the future serve, in management or directorship capacities at companies engaged in similar areas of research Recently enacted and future legislation may increase the difficulty and development, or that have product candidates or products and cost for us to commercialize our product candidates and affect targeting the same indications as our product candidates. As a the prices we may obtain. result, such members of management may face actual, potential or perceived conflicts of interest, in particular when we enter into Among policy makers and payors in the United States and contractual arrangements with such companies. For example, elsewhere, there is significant interest in promoting changes Bernard Gilly is currently non-executive Chairman of the Board of in healthcare systems with the stated goals of containing Directors of Pixium Vision, a company working on retinal implant healthcare costs, improving quality and/or expanding access. technology targeting RP patients at an advanced stage of the In the United States, the ACA is significantly impacting the disease with no photoreceptor left, whereas gene therapy is provision of, and payment for, healthcare. Various provisions of targeting patients earlier in the disease with some residual vision the ACA were designed to expand Medicaid eligibility, subsidize and photoreceptors. See Section 14.1.2 “Biographical Information insurance premiums, provide incentives for businesses to provide About the Members of the Board of Directors and Officers of the healthcare benefits, prohibit denials of coverage due to pre- Company” and Section 6.6, “Our Second Product Candidate: existing conditions, establish health insurance exchanges, and GS030 for the Treatment of RP—No Existing Therapies for the provide additional support for medical research. With regard Treatment of RP” of this Registration Document. We have entered to biopharmaceutical products specifical ly, the ACA, among into a consortium agreement and related agreements for the other things, expanded and increased industry rebates for drugs financing and conduct of research and development activities with covered under Medicaid programs and made changes to the Pixium Vision and FVE, a scientific foundation that funds scientific coverage requirements under the Medicare Part D program. programs in the field of ophthalmic diseases. See Section 11.4, However, some provisions of the ACA have yet to be ful ly “Col laboration, Partnership and Related Agreements” of this implemented and certain provisions have been subject to judicial Registration Document. We have entered into a consortium and Congressional chal lenges, as wel l as efforts by the Trump agreement and related agreements for the financing and conduct Administration to repeal or replace certain aspects of the ACA. of research and development activities with Pixium Vision and Since January 2017, President Trump has signed two Executive FVE, a scientific foundation that funds scientific programs in the Orders and other directives designed to delay the implementation field of ophthalmic diseases. of certain provisions of the ACA or otherwise circumvent some If we are unable to manage our expected growth, we may not of the requirements for health insurance mandated by the achieve our research and development plans in line with our timing ACA. Concurrently, Congress has considered legislation that expectations or at all. would repeal or repeal and replace all or part of the ACA. While Congress has not passed comprehensive repeal legislation, two To be successful in executing our business strategy, we expect bills affecting the implementation of certain taxes under the ACA that we wil l need to expand our resources to manage our have been signed into law. The Tax Cuts and Jobs Act of 2017 operations, continue our research and development activities includes a provision repealing, effective January 1, 2019, the and, in the longer term, build a commercial infrastructure to tax-based shared responsibility payment imposed by the ACA on support commercialization of any of our product candidates that certain individuals who fail to maintain qualifying health coverage are approved for sale. Future growth would impose significant for al l or part of a year that is commonly referred to as the added responsibilities on members of management. The “individual mandate.” Additionally, on January 22, 2018, President expansion of our operations may lead to significant costs and may Trump signed a continuing resolution on appropriations for fiscal divert our management and business development resources. It is year 2018 that delayed the implementation of certain ACA- likely that our management, finance and development personnel, mandated fees, including the so-called “Cadillac” tax on certain 38 – GENSIGHT BIOLOGICS – 2017 Registration Document