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Unity Biotechnology, Inc.

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FY2022 Annual Report · Unity Biotechnology, Inc.
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UNITED STATES 
SECURITIES AND EXCHANGE COMMISSION 
Washington, D.C. 20549
FORM 10-K 

(Mark One) 

☒

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 

For the fiscal year ended December 31, 2022
OR

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION 
PERIOD FROM                      TO                     

Commission File Number 001-38470 
Unity Biotechnology, Inc.

(Exact name of Registrant as specified in its Charter) 

Delaware
( State or other jurisdiction of
incorporation or organization)
285 East Grand Ave. 
South San Francisco, CA
(Address of principal executive offices)

26-4726035
(I.R.S. Employer
Identification No.)

94080
(Zip Code)

Registrant’s telephone number, including area code: (650) 416-1192

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

Title of each class

Common Stock, par value $0.0001

Trading Symbol(s)

UBX

Name of each exchange on which registered

The Nasdaq Global Select Market

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

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ☐ NO ☒
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. YES ☐ NO ☒ 
Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 
months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ☒ NO ☐ 
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of 
this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). YES ☒ NO ☐ 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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
Non-accelerated filer
Emerging growth company

Accelerated filer
Smaller reporting company

  ☐  
  ☒  
  ☒  

  ☐
  ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial 
accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐
Indicate by check mark whether the Registrant has filed a report on and attestation to its management assessment of the effectiveness of its internal control over financial reporting 
under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of 
an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s 
executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒
The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, based on the closing price of the shares of common stock on The 
Nasdaq Global Select Market on June 30, 2022 was $32,542,134. 
The number of shares of Registrant’s Common Stock outstanding as of March 10, 2023 was 14,339,119. 

DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant’s Definitive Proxy Statement relating to the 2023 Annual Meeting of Shareholders, scheduled to be held on June 23, 2023, are incorporated by reference into 
Part III of this Report. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the end of the fiscal year covered by this Annual Report on 
Form 10-K.

 
  
 
 
 
 
 
 
 
 
 
 
 
   
 
 
PART I
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.

PART II
Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.
Item 9C.

PART III
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.

PART IV
Item 15.
Item 16.

Table of Contents

Business
Risk Factors
Unresolved Staff Comments
Properties
Legal Proceedings
Mine Safety Disclosures

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
[Reserved]
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accounting Fees and Services

Exhibits, Financial Statement Schedules
Form 10-K Summary
Signatures

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Forward-Looking Statements

This Annual Report on Form 10-K contains “forward-looking statements” within the meaning of 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  on  Form  10-K  are 
statements that could be deemed forward-looking statements reflecting the current beliefs and expectations of management with respect to future events or 
to our future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance 
or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. 
These  statements  are  often  identified  by  the  use  of  words  such  as  “aim,”  “anticipate,”  “assume,”  “believe,”  “contemplate,”  “continue,”  “could,”  “due,” 
“estimate,” “expect,” “goal,” “if,” “intend,” “may,” “objective,” “plan,” “predict,” “potential,” “positioned,” “seek,” “should,” “target,” “will,” “would,” 
“until,” and similar expressions or variations. Forward-looking statements contained in this Annual Report on Form 10-K include, but are not limited to, 
statements about:

•

•

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•

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•

•

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our plans to develop and commercialize UBX1325 or any future product candidates;

our expectations regarding the potential benefits, activity, effectiveness, and safety of our drug candidates;

our ongoing and planned clinical trials, including expectations with regard to the results of our clinical studies, preclinical studies and research and 
development programs, including the timing and availability of data from such studies;

our predictions about the results of future or ongoing clinical trials, including predictions based on results from a clinical trial;

our  preclinical,  clinical  and  regulatory  development  plans  for  our  drug  candidates,  including  the  timing  or  likelihood  of  regulatory  filings  and 
approvals for our drug candidates;

our expectations with regard to our ability to acquire, discover and develop additional drug candidates and advance such drug candidates into, and 
successfully complete, clinical studies;

our  expectations  regarding  the  potential  market  size  and  size  of  the  potential  patient  populations  for  our  drug  candidates,  if  approved  for 
commercial use;

our intentions and our ability to establish collaborations and/or partnerships;

the timing and amount of any milestone payments we are obligated to make pursuant to our existing license agreements and any future license or 
collaboration agreements that we may enter into;

our commercialization, marketing and manufacturing capabilities and expectations;

our intentions with respect to the commercialization of our drug candidates;

the pricing and reimbursement of our drug candidates, if approved;

the implementation of our business model and strategic plans for our business and drug candidates, including additional indications that we may 
pursue;

the scope of protection we are able to establish and maintain for intellectual property rights covering our drug candidates, including the projected 
terms of patent protection;

estimates of our expenses, future revenue, capital requirements, our needs for additional financing, and our ability to obtain additional capital;

the lingering effects of the COVID-19 pandemic and the effects of any future pandemic on our clinical trials and business;

our ability to maintain compliance with the minimum required closing bid price for continued listing on the Nasdaq Global Select Market and the 
success of the Reverse Stock Split;

developments and projections relating to our competitors and our industry, including competing therapies;

our financial performance;

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• macroeconomic trends and uncertainty, including high interest rates, rising inflation, the government closure of Silicon Valley Bank and liquidity 

concerns at other financial institutions, and the potential for local and/or global economic recession; and

•

other risks and uncertainties, including those listed under the caption “Risk Factors.”

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Annual Report on Form 10-K.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or 
achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. We 
discuss these risks in greater detail in “Risk Factors” and elsewhere in this Annual Report on Form 10-K. Given these uncertainties, you should not place 
undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s beliefs and assumptions only as of the 
date of this Annual Report on Form 10-K. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to 
update  the  reasons  actual  results  could  differ  materially  from  those  anticipated  in  these  forward-looking  statements,  even  if  new  information  becomes 
available in the future.

This  Annual  Report  on  Form  10-K  also  contains  estimates,  projections,  and  other  information  concerning  our  industry,  our  business  and  the 
markets for certain drugs, including data regarding the estimated size of those markets, their projected growth rates, and the incidence of certain medical 
conditions. Information that is based on estimates, forecasts, projections or similar methodologies is inherently subject to uncertainties, and actual events or 
circumstances  may  differ  materially  from  events  and  circumstances  reflected  in  this  information.  Unless  otherwise  expressly  stated,  we  obtained  this 
industry, business, market, and other data from reports, research surveys, studies, and similar data prepared by third parties, industry, medical and general 
publications, government data, and similar sources. In some cases, we do not expressly refer to the sources from which this data is derived. In that regard, 
when we refer to one or more sources of this type of data in any paragraph, you should assume that other data of this type appearing in the same paragraph 
is derived from the same sources, unless otherwise expressly stated or the context otherwise requires.

Trademarks

This Annual Report on Form 10-K includes trademarks, service marks, and trade names owned by us or other companies. All trademarks, service 

marks and trade names included in this Annual Report on Form 10-K are the property of their respective owners.

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PART I

Item 1. Business. 

Overview

Our mission is to slow, halt, or reverse diseases of aging. Our initial focus is on creating senolytic medicines to selectively eliminate senescent 

cells and thereby treat diseases of aging, such as ophthalmologic diseases, with the opportunity to explore neurology and other therapeutic areas. 

Diseases  of  aging  cause  considerable  economic,  personal,  and  societal  burden.  As  individuals  age,  the  prevalence  of  chronic  disease  increases, 
with 80% of older Americans having at least one chronic disease and 50% having two or more. Diseases of aging negatively impact quality of life, are 
typically chronic, and progress from the time of onset until death. It is estimated that providing healthcare for people over the age of 65 costs four to five 
times more than for younger individuals. According to the United States Census Bureau, this elderly population of Americans is expected to increase nearly 
50% by 2050, increasing the economic burden of aging dramatically. Any success increasing longevity without treating underlying diseases of aging would 
only serve to increase this burden. 

We believe that by creating medicines that target fundamental aging mechanisms, we can reduce the economic, personal, and societal burden of

aging and enhance quality of life.

In  February  2022,  we  announced  a  restructuring  to  align  resources  to  focus  on  our  ongoing  clinical  programs  and  deliver  on  key  development 
milestones. These actions to prioritize our ophthalmology programs and implement cost saving measures were designed to enable us to achieve multiple 
key clinical data readouts for UBX1325 as well as support the Tie2 and Tie2/VEGF bispecific program through advanced candidate nomination, with all 
other pipeline programs paused to focus resources on these advanced programs.

Targeting Cellular Senescence and Other Biologies of Aging

We  believe  that  the  accumulation  of  senescent  cells  is  a  fundamental  mechanism  of  aging  and  a  driver  of  many  common  diseases  of  aging. 
Cellular  senescence  is  a  natural  biological  state  in  which  a  cell  permanently  halts  division.  These  cells  are  referred  to  as  senescent.  Senescent  cells 
accumulate with age, secreting large quantities of more than 100 proteins, including inflammatory factors, proteases, fibrotic factors, and growth factors, 
that disturb the tissue micro-environment. This collection of secreted proteins is referred to as the Senescence Associated Secretory Phenotype, or SASP. In 
addition  to  its  effects  on  tissue  function,  the  SASP  contains  factors  that  induce  senescence  in  neighboring  cells,  setting  off  a  cascade  of  events  that 
culminates in the formation of the functionally aged and/or diseased tissue that underlies a variety of age-related diseases. 

We are developing senolytic medicines to eliminate senescent cells and thereby lower the production of the SASP, which we believe addresses a 
root cause of age-related diseases. Many existing therapeutics, such as antibodies, target single SASP factors, but fail to remove the cells that continually 
produce these factors. By stopping the production of the SASP at it source, we believe senolytic medicines could have a more durable impact by slowing, 
halting,  or  reversing  particular  diseases  of  aging,  and  shift  the  treatment  paradigm  from  chronic  to  intermittent  dosing.  Less  frequent  dosing  may  also 
improve drug tolerability and patient adherence.  

While our primary focus is on programs targeting cellular senescence, we are exploring other biologies of aging that may have a major impact on 
diseases of aging. For instance, we have a preclinical program targeting Tie2 signaling. Tie2 is a receptor tyrosine kinase that is implicated in regulating 
barrier function in blood vessels of the eye, which are affected in several prevalent eye diseases. Tie2 is also implicated in kidney disease. We also have a 
preclinical program targeting both Tie2 and VEGF (Tie2/VEGF bispecific) designed to neutralize VEGF and activate Tie2, two major pathways involved in 
retinal  disease.  We  have  outlicensed  our  program  in  α-Klotho,  a  protein  that  has  been  implicated  in  human  cognition  and  may  provide  benefits  in  age-
related cognitive dysfunctions.

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Our Pipeline 

We are targeting specific biological mechanisms implicated in diseases of aging. Our core therapeutic approach targets cellular senescence, and we 
are currently advancing senolytic programs primarily in ophthalmologic disorders. In addition, we are advancing other programs based on other biologies 
of aging to include an agonistic antibody to the Tie2 receptor and a Tie2/VEGF bispecific to treat vascular eye disease.  

Ophthalmology Program

UBX1325 is our most advanced lead drug candidate for age-related diseases of the eye, including diabetic macular edema, or DME, age-related 
macular  degeneration,  or  AMD,  and  diabetic  retinopathy,  or  DR. UBX1967  is  our  back-up  compound  to  UBX1325.  Each  of  these  drug  candidates  are 
potent small molecule inhibitors of Bcl-xL, a member of the Bcl-2 family of apoptosis regulating proteins, and has shown distinct tissue residence time 
profiles  in  preclinical  studies.  UBX1325  and  UBX1967  are  designed  to  inhibit  the  function  of  proteins  that  senescent  cells  rely  on  for  survival.  In  our 
preclinical studies, we have demonstrated that targeting Bcl-xL with UBX1325 and UBX1967 preferentially eliminated senescent cells from diseased tissue 
while sparing cells in healthy tissue. 

In July 2020, we filed an Investigational New Drug application, or IND, to commence a Phase 1, first-in-human, open-label, single-ascending dose 
study of UBX1325 in patients with advanced diabetic macular edema, or DME, and neovascular age-related macular degeneration, or nAMD. Our goal 
with UBX1325 is to transformationally improve outcomes for patients with DME, nAMD, and diabetic retinopathy, or DR. In October 2020, the Phase 1, 
first-in-human, clinical study of UBX1325 commenced. That study, an open-label, single ascending dose clinical trial, evaluated doses from 0.5 – 10 µg 
administered as a single intra-vitreal injection in up to 8 patients with DME and 11 patients with nAMD all of whom had been off all anti-VEGF treatment 
due to lack of benefit for at least 6 months. The results of this study demonstrated acceptable safety and tolerability without any dose-limiting toxicities; no 
evidence of intraocular inflammation; and mean improvement in BCVA of up to 9.5 ETDRS letters in those patients with DME receiving higher doses (5 
and 10 µg) and a mean improvement in BCVA of 3.2 ETDRS letters in evaluable patients with nAMD at all doses, both at 24 weeks after treatment with 
UBX1325.

In May 2021, we initiated our Phase 2 proof-of-concept study to evaluate the safety, efficacy, and durability of a single intravitreal injection of 
UBX1325 in a broader population of patients with DME, or the BEHOLD study, and dosed our first patient in June 2021. This study is a multi-center,
randomized, double-masked, sham-controlled study designed to evaluate the safety, tolerability, efficacy and durability of a single 10 µg dose of UBX1325 
in patients with DME evaluated though 24 weeks. Patients have the option of rolling over to a 48-week long term extension and a majority of patients who 
have completed their 24-week visits have opted to remain in the study. A total of 65 patients were enrolled, randomized evenly between UBX1325 and 
sham-injected patients. These patients were being actively treated with anti-VEGF for at least 6 months prior to being randomized into the BEHOLD study 
(mean of 4.03 injections in the 6 months preceding randomization), and had persistent visual acuity deficits (73 ETDRS letters or worse, approximately 
20/40 or worse, mean of 61.4 letters at baseline) and residual retinal fluid (≥300 µm of central subfield thickness on optical coherence tomography, mean of 
approximately 439.6 µm). At the time of randomization, patients were taken off of their anti-VEGF treatment, and instead treated with UBX1325 or a sham 
procedure. Endpoints being explored in the study include safety and tolerability, changes in BCVA, CST, SRF/IRF, proportion of patients requiring rescue 
treatment, and durability of effects.

In August 2022, we announced positive 12- and 18-week data in our Phase 2 BEHOLD study of UBX1325 in patients with DME, including that a 
single  injection  of  UBX1325  led  to  a  progressive,  statistically  significant,  and  clinically  meaningful  improvement  in  mean  best-corrected  visual  acuity 
compared to sham treatment. At Week 18, the mean change from baseline of BCVA for UBX1325-treated subjects was an increase of 6.1 ETDRS letters 
that represents a difference of +5.0 ETDRS letters compared to sham-treated subjects (p=0.0368). In addition, patients treated with UBX1325 maintained 
central subfield thickness (CST) (+3.2 microns) compared to sham-treated patients who had progressive worsening (increase) in CST through 18 weeks 
(+53.5 microns) (p=0.0719). 

In November 2022, we announced positive 24-week data in our BEHOLD study, showing that a single injection of UBX1325 led to a statistically 
significant and clinically meaningful improvement in BCVA of +6.2 ETDRS letters from baseline and +7.6 ETDRS letters compared to sham treatment 
(p=0.0084). Inclusive of rescue data, patients treated with UBX1325 had a mean improvement in BCVA of +6.4 ETDRS letters from baseline and +5.2 
ETDRS letters compared to sham (p=0.0068). At 24 weeks, patients treated with UBX1325 had a mean change 

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in CST of -5.4 microns from baseline compared to a worsening (increase) of +34.6 microns in sham-treated patients (p=0.1244). The proportion of rescue-
free patients at 24 weeks was greater on UBX1325 (59.4%) as compared to sham (37.5%) with fewer total rescues and longer time-to-rescue in UBX1325-
treated patients as compared to sham. UBX1325 demonstrated a favorable safety and tolerability profile with no cases of intraocular inflammation, retinal 
artery occlusion, endophthalmitis, or vasculitis. Patients will continue to be followed through 48 weeks post-treatment in a long-term follow-up, with data 
expected in the second quarter of 2023.

In March 2022, we enrolled our first patient in our Phase 2 proof-of-concept study in nAMD, or the ENVISION study. In September 2022, the 
study completed enrollment of patients with nAMD who have had at least two intravitreal injections of anti-VEGF therapy in the preceding six months and
who  still  have  active  choroidal  neovascularization  and  residual  sub-  or  intra-retinal  fluid.  Patients  have  received  their  last  anti-VEGF  treatment 
approximately 4-8 weeks prior to screening, and all patients will be followed for approximately 24 weeks after dosing with either UBX1325 or aflibercept. 
We expect to announce both 16-week and 24-week data from this Phase 2 proof-of-concept study in nAMD in late March 2023. In addition, we amended 
the Phase 2 ENVISION study including a Part B portion of the study to explore the benefit of a second cycle of two doses of UBX1325 treatment 4 weeks 
apart, administered at Weeks 24 and 28 weeks and the potential benefit of combination treatment with anti-VEGF therapy at Weeks 24 and 32 with all 
patients followed through Week 48. Data from Part B of the 48-week extension study is expected in the third quarter of 2023.

Under  our  current  amended  license  agreement  with  Ascentage  Pharma  Group  Corp.  Limited,  or  Ascentage,  we  have,  among  other  things, 
exclusive  worldwide  development  and  commercialization  rights  and  non-exclusive  manufacturing  rights  to  UBX1325  outside  of  Greater  China  (China, 
Hong Kong, Macau and Taiwan) in all non-oncology indications. Inside Greater China, we have the right to negotiate a joint venture with Ascentage to 
develop, manufacture and commercialize UBX1325. See “Licenses and Collaborations.” 

We also have a Tie2/VEGF bispecific program. Tie2 is a receptor tyrosine kinase that is implicated in regulating barrier function in blood vessels 
of the eye, which are affected in several prevalent eye diseases. Tie2 is an important key regulator of the vascular endothelium in the eye and dysregulation 
of this pathway leads to loss of barrier integrity and healthy vasculature. Preliminary studies suggest that cellular senescence in aging eyes may induce 
Ang-2 and therefore deactivate Tie2, leading to ocular edema.

The Tie2/VEGF bispecific has dual functionality on two validated targets for retinal diseases. In addition to direct activation of Tie2, the bispecific 
candidate is designed to neutralize VEGF-A and VEGF-B. We believe that direct agonism of Tie2 may be superior to antagonism of Ang2 which relies on 
adequate levels of endogenous Ang1 to activate the Tie2 pathway. We have identified Tie2/VEGF bispecific molecules that have pharmacological activity 
on Tie2 and VEGF with potencies relevant for clinical benefit. Based on supporting preclinical data, we designated an Advanced Candidate in July 2022. 
We are currently seeking to initiate pilot preclinical toxicology experiments and other work to support nomination of a Development Candidate that should 
enable initiation of IND-enabling studies by the end of 2023.

UBX2050 is our investigational, fully human anti-Tie2 agonist monoclonal antibody. Tie2 dysregulation is implicated in eye disease as well as 
other indications. UBX2050 is derived from an asset that was acquired from Achaogen, Inc. in June 2020 through an Asset Purchase Agreement. UBX2050 
was selected based on its potential to activate the Tie2 receptor in vitro and has demonstrated encouraging activity in preclinical models of ocular disease. 
We believe UBX2050 may be an orthogonal approach to restoring barrier function and vascular function and have explored a number of indications for 
UBX2050.

Neurology Program

We  believe  cellular  senescence  may  play  a  fundamental  role  in  neurodegeneration.  Multiple  lines  of  evidence  suggest  that  senescent  cells 
accumulate in the nervous system during normal aging and neurodegenerative diseases. Several third-party preclinical proof of concept studies in mouse 
models of aging and neurodegeneration have provided preliminary evidence that the removal of senescent cells via senolytic drugs or genetic methods have 
the potential to improve brain function. 

UBX2089,  an  α-Klotho  hormone  drug  candidate,  is  a  circulating  hormone  primarily  produced  in  the  kidneys  and  choroid  plexus  of  the  brain,

which is being researched for multiple neurology indications. Human genetic evidence 

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links α-Klotho to cognitive function, and we have observed pro-cognitive activity of recombinant α-Klotho in multiple preclinical rodent and non-human 
primate  models.  Our  work  focused  on  investigating  the  effect  of  UBX2089  on  engaging  CNS  circuits  in  preclinical  animal  models  with  the  intent  of
advancement to clinical studies, and in December 2021, we announced an exclusive licensing agreement of our α-Klotho asset to Jocasta Neuroscience, 
Inc. for development and commercialization.

Our Approach to Slowing, Halting, or Reversing Diseases of Aging

Targeting Cellular Senescence 

Cellular senescence is a natural biological state in which a cell permanently halts division. Cells become senescent when they experience some 
form of unresolvable cellular stress. These cellular stress events result in the activation of the tumor suppressor protein p53, which drives the production of 
two  cell-cycle  dependent  kinase  inhibitors,  or  CDK  inhibitors,  p21  and  p16.  These  two  molecules  are  required  for  the  establishment  and  subsequent
maintenance of the senescent cell state. The first CDK inhibitor to be produced is p21, which works through subsequent pathways to block the production 
of numerous proteins that cells need to divide. The initial p21-driven signal is an acute response to cell damage and eventually decreases. In contrast, p16 
permanently locks the cell into a non-dividing state and the production of p16 continues as long as the cell lives. Given that p16 production, in most cases, 
continues indefinitely and is believed to be produced almost exclusively in senescent cells, it is a widely used marker to identify and quantify senescent 
cells. 

The process through which stress mechanisms can induce cells to become senescent is illustrated in the figure below. 

Figure 1: Illustration of induction of the senescent state and secretion of factors that can damage the microenvironment

How Senescent Cells Drive Diseases of Aging 

Once cells become senescent, they begin secreting large quantities of proteins, including pro-inflammatory factors that recruit the immune system, 
proteases that remodel the extra-cellular matrix, pro-fibrotic factors that drive the formation of dysfunctional matrix, and growth factors that perturb the 
function of the tissue micro-environment. This collection of secreted proteins is referred to as the Senescence Associated Secretory Phenotype, or SASP. In 
addition  to  affecting  normal  tissue  function,  the  SASP  contains  factors  that  induce  senescence  in  neighboring  cells,  setting  off  a  cascade  of  events  that 
ultimately culminates in the formation of a functionally aged and/or diseased tissue that underlies a variety of age-related diseases. 

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Numerous SASP factors have been implicated as potentially contributing to human disease and it is now believed that the SASP is the primary 
means  by  which  senescent  cells  drive  specific  diseases  of  aging.  For  example,  a  variety  of  single  SASP  factors  (e.g.,  TNF-α  and  VEGF-A)  have  been 
demonstrated to drive human diseases by themselves and have been the target of well-known antibody therapeutics, including HUMIRA® and EYLEA®. 
While these antibodies are able to modify human disease by removing the activity of a single factor, we believe the clearance of senescent cells will remove 
the source of numerous SASP factors, providing improvement in both efficacy and duration-of-effect.  

Our Therapeutic Paradigm 

We were founded on the principle that the selective elimination of senescent cells and their accompanying SASP has the potential to slow, halt, or 
reverse  diseases  of  aging.  Our  insights  into  senescent  cell  biology  allow  us  to  identify  senescence-driven  diseases,  target  the  senescent  cells  driving  a 
particular disease, and selectively eliminate these cells. The figure below illustrates this process. 

Figure 2: Illustration of the senolytic therapeutic hypothesis

In  developing  this  approach,  we  have  acquired  significant  expertise  with  respect  to  senescent  cell  survival  pathways,  which  are  the  signaling 
systems  that  senescent  cells  rely  on  for  survival.  When  these  pathways  are  targeted  with  specifically  designed  molecules,  senescent  cells  undergo 
programmed cell death. Through our research, we have identified several of these mechanistically distinct survival pathways, which differ depending on 
cell type and the tissue in which the senescent cells reside. 

Advantages of Our Approach 

We believe that senolytic medicines that selectively eliminate senescent cells from diseased tissues may have several advantages over other efforts 

to treat diseases of aging: 

•

Senolytic medicines target a root cause of diseases of aging. We believe that the accumulation of senescent cells is a root cause of many diseases 
of aging. Unlike treatments that inhibit the activity of a single factor (such as antibodies targeting single pro-inflammatory proteins), we believe a 
senolytic medicine that eliminates accumulated senescent cells and consequently also their associated SASP, could blunt the activity of numerous 
factors  contributing  to  disease.  As  a  result,  senolytic  medicines  could  have  improved  efficacy  because  they  target  diseases  at  their  source  and 
therefore may be able to normalize tissue levels of numerous disease-causing factors simultaneously. 

9

 
 
 
 
•

•

Senolytic medicines can be dosed intermittently. The administration of senolytic medicines would remove senescent cells from diseased tissue. 
As  new  senescent  cells  may  take  months  or  perhaps  years  to  re-accumulate,  senolytic  medicines  could  potentially  be  dosed  infrequently. 
Intermittent dosing may also improve drug tolerability and patient adherence when compared to chronic therapies.

Senolytic medicines restore tissues to a healthy state. We believe senescent cells generally do not accumulate in young individuals and that the 
accumulation of senescent cells in older individuals interferes with normal tissue function. Our goal for the administration of senolytic medicines 
is to restore tissue to a functionally younger state. 

Ophthalmology Programs Targeting Cellular Senescence

Unmet Need and Therapeutic Rationale 

Our Programs

The majority of significant eye diseases are age-related, with the prevalence of vision-threatening disease increasing significantly over the age of 
75. Of the 285 million individuals worldwide living with visual impairment, 65% are over the age of 50. The individual diseases that are associated with 
these  figures  include  age-related  macular  degeneration,  diabetic  macular  edema,  and  diabetic  eye  diseases,  all  of  which  have  a  high  prevalence  and 
significant unmet need in either prevention or therapeutic options. The diseases we are evaluating as initial target indications for local administration of 
senolytic therapy in the eye are age-related macular degeneration, diabetic macular edema, and diabetic retinopathy. 

Diabetic Macular Edema 

Diabetic macular edema is a condition in which the metabolic abnormalities associated with diabetes, including high levels of blood glucose, or 
hyperglycemia,  damage  blood  vessels  in  the  central  portion  of  the  retina,  or  the  macula,  causing  those  vessels  to  leak  fluid.  The  leaking  fluid  leads  to 
swelling and subsequently to abnormalities of vision. The prevalence of diabetic macular edema, or DME, in the United States ranges from approximately 
4.0% to 6.8% of people with diabetes who are 40 years of age or older. In 2019, it was estimated that more than 20 million people worldwide are affected 
by  DME.  There  is  a  high  burden  of  DME  among  non-Hispanic  blacks  and  robust  associations  with  higher  hemoglobin  A1c  and  longer  duration  of 
underlying diabetes.

Despite the success achieved with anti-VEGF treatment for retinal disease like AMD that involve the proliferation of abnormal blood vessels, or 
neovascularization, the impact of such treatment in DME has been more limited. This is due to the challenging nature of the therapeutic regimen (which 
entails monthly and or bimonthly IVT injections for up to two years), the number of cases that are refractory to anti-VEGF treatment (approximately 50% 
of  DME  patients),  and  the  long-term  complications  of  increased  ischemia  and  retinal  fibrosis  associated  with  long-term  treatment  with  anti-VEGF 
injections. As a result, there is an unmet need in this group of patients. Although VEGF has been identified as a major factor for neovascular disease, other 
factors, which we believe include SASP factors, are present in DME, including IL-1ß, TNF-(cid:0), IL-6, and TGF-ß, among others. Due to the multifactorial 
nature of the disease, a significant opportunity exists to develop a more comprehensive approach to the treatment of DME, such as senolysis, that targets 
the root cause of the disease.

Age-Related Macular Degeneration 

Age-related macular degeneration, or AMD, is the leading cause of irreversible vision loss in developed countries, particularly in people older than 
60 years. In 2014, it was projected that by 2020 the number of people worldwide with AMD would be 196 million and could increase to 288 million by 
2040. The prevalence of AMD increases significantly with advancing age, with a prevalence rate of 1.63% in those aged 65 to 69 years which increases to 
11.73% in those aged 80 years or older. AMD affects central vision, impairing functions such as reading, driving, and facial recognition, and has a major 
impact  on  quality  of  life  and  the  ability  to  live  independently.  AMD  is  defined  in  three  stages:  (i)  “early,”  in  which  visual  function  is  affected  in  the 
presence of signs of age-related changes in the retina such as drusen and pigmentary changes; (ii) “intermediate,” in which increasing degrees of macular 
lipid 

10

 
deposition and structural changes are noted; and (iii) “late,” in which central vision is compromised due to abnormal blood vessel growth (known as “wet” 
AMD)  or  advanced  atrophy  of  the  retina  (known  as  “dry”  AMD).  AMD  is  a  heterogenous,  complex,  multifactorial  disease,  with  inflammatory, 
degenerative,  genetic,  and  vascular  factors  all  contributing  to  its  development  and  progression.  The  potential  role  of  senescent  cells  and  the  associated 
SASP in driving the two main presentations of the disease, both wet and dry forms, could prove a unifying mechanism across this complex disorder. 

Current standard of care for wet AMD is the administration of anti-vascular endothelial growth factor, or anti-VEGF, antibody drugs that control 
aspects  of  the  wet  form  of  the  disease  only.  The  development  of  therapeutic  options  for  dry  AMD  has  proven  to  be  challenging  in  that  all  current 
development candidates are aimed at slowing the progression of disease, with none able to halt or reverse the inevitable loss of functional retinal segments. 
Several  agents  that  slow  the  progression  of  disease  via  inhibition  of  various  factors  within  the  complement  system  are  in  advanced  stages,  with 
EMPAVELI® (pegcetoplan) by Apellis having been approved. While there may be limited potential options for geographic atrophy (an advanced form of 
dry AMD), there are no approved therapies available to fully halt progression or reverse the disease. And while wet AMD has been significantly impacted
by anti-VEGF therapy, that approach is limited by the need for frequent eye injections over a long period of time, a significant percentage of patients not 
completing or being non-responsive or poorly-responsive to anti-VEGF therapy, and the contribution of multiple other mechanisms at play in the disease 
beyond  VEGF.  Thus,  there  is  considerable  potential  for  a  senolytic  approach  to  impact  disease  progression  and  achieve  stabilization  in  AMD  via
modulation of senescent cell burden and the accompanying SASP. SASP factors in AMD include molecules that promote abnormal blood vessel growth, 
inflammation,  and  fibrosis,  all  of  which  have  been  implicated  in  various  stages  of  the  disease.  We  believe  that  a  senolytic  medicine  could  have  a 
meaningful and prolonged impact on the AMD disease state and help restore the cellular microenvironment to a more normal, pre-senescent state.

Diabetic Retinopathy 

Diabetic retinopathy, or DR, is estimated to affect over 90 million people globally and approximately 28 million have vision-threatening stages of 
disease. It is a leading cause of vision loss in middle-aged and elderly people and impacts 8% of the U.S. population over age 65. Due to the increasing 
diabetic population arising from lifestyle changes in developing countries, the disease incidence is predicted to climb. 

Diabetic  retinopathy  is  a  complex  multifactorial  disease,  characterized  by  progression  through  a  series  of  stages  of  increasing  severity.  The 
metabolic abnormalities associated with diabetes incite a variety of inflammatory and metabolic stress-induced events which leads to proliferation of new 
blood vessels and subsequent bleeding and swelling, which in turn causes scarring and vision loss or may lead to blood vessel occlusion, limiting blood 
flow and leading to damage to the retinal photoreceptors and nerves supplied by those vessels. The risk of developing diabetic retinopathy and its severity 
increase with the duration of underlying diabetes. It is also associated with poor glycemic control and the presence of additional coexistent diseases, such as 
high blood pressure, high cholesterol levels, and impaired kidney function. 

Current standard of care for diabetic retinopathy, which includes blood sugar control, anti-VEGF drugs, steroid injections, and laser therapy, is 
modestly  effective.  The  limitations  of  existing  therapy  include  general  challenges  with  achieving  diabetes  control,  the  need  for  frequent  intravitreal 
injections for the administration of anti-VEGF therapy, a significant percentage of patients not completing or being non-responsive to anti-VEGF therapy, 
and tissue destruction with permanent side effects from laser therapy. This presents a significant opportunity to design and develop a treatment paradigm, 
such as senolytic medications like UBX1325, that treats a root cause of the disease. 

Evidence suggests that diabetic retinopathy is driven by the accumulation of senescent cells that are a direct result of elevated glucose levels in 
patients with diabetes. These senescent cells are triggered by local stresses in the retina and their accumulation drives the production of the accompanying 
ocular SASP factors, VEGF and platelet-derived growth factor, or PDGF. Overproduction of VEGF and IL-6 leads to ocular inflammation and abnormal 
blood vessel growth, key signatures of diabetic retinopathy. Thus, a senolytic approach could target multiple aspects of the underlying causes of diabetic 
retinopathy and ideally lead to greater therapeutic coverage in a wider range of patients. This elimination of senescent cell accumulation and accompanying 
SASP factors could limit further disease progression, reduce vessel leakage and inflammation, and prevent vision loss. 

11

 
Evidence for Senescence Burden in Human Disease and Human Biomarker Discovery: AMD, DR and DME

We  evaluated  the  presence  of  senescent  cells  by  IHC  staining  for  p16  in  post-mortem  retinal  donor  tissue  from  individuals  who  carried  a  pre-
mortem diagnosis of AMD, DR/DME, or neither. We believe the resulting data support our hypothesis that the accumulation of senescent cells is linked to 
AMD and DR/DME.  Quantification of IHC images indicated a significant increase in senescent cell burden (as measured by p16+ cells) in both AMD and 
DR patient globes (Figure 3).  

Figure 3: Quantification of senescent cell burden in AMD and DR/DME

We  also  compared  the  presence  of  senescence  in  human  retinal  microvascular  endothelial  cells,  or  HRMEC,  versus  retinal  donor  tissue  from 
human  DME/DR  patients  by  evaluating  the  gene  expression  of  several  disease-relevant  factors.  Quantitative  polymerase  chain  reaction,  or  qPCR, 
demonstrated elevations in the SASP factors VEGF, PDGF, IL1B, and TNF in senescent HRMEC, relative to non-senescent cells. These disease-relevant 
mediators have been reported to be elevated in DME/DR patients. We believe this data is consistent with our hypothesis that senescent cell accumulation 
and SASP factors play a central role in both DME and DR. 

Mechanism of Action of UBX1325 (Inhibitors of the Bcl-2 Family) 

UBX1325, our lead drug candidate (along with our backup compound in our ophthalmology program, UBX1967) is a potent and selective small 
molecule  inhibitor  of  Bcl-xL,  a  specific  member  of  the  Bcl-2  family  of  apoptosis  regulating  proteins.  The  B-cell  lymphoma  2,  or  Bcl-2,  gene  family 
encodes  more  than  20  proteins  that  regulate  the  intrinsic  apoptosis  pathway  and  are  fundamental  to  the  balance  between  cell  survival  and  cell  death. 
Inhibition of certain Bcl-2 family proteins results in cell death in certain cell types. Targeting this pathway has been studied extensively in connection with 
the search for new oncology medicines.  

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In Vitro and In Vivo Pharmacology Studies with UBX1325 

We conducted an in vitro assessment of binding and efficacy of UBX1325 to determine both its potency for the Bcl-2 family protein targets and its 
potency at eliminating senescent cells. Biochemical assays for Bcl-2, Bcl-xL, and Bcl-w yielded binding affinities in the sub-nanomolar range, but with a 
higher affinity for Bcl-xL. UBX1325 is a phosphate pro-drug that releases the active parent molecule known as UBX0601. In order to assess the activity of 
UBX0601 on senescent cells, we used a cell-based assay with radiation-induced senescence. Senescent cells were exposed to increasing concentrations of 
UBX0601  for  72  hours.  In  this  study,  UBX0601  showed  potent,  concentration-dependent  senolytic  activity  against  human  fetal  lung  cells,  or  IMR90, 
primary  human  umbilical  vein  endothelial  cells,  or  HUVEC,  and  HRMEC  as  measured  by  reduction  of  senescent  cell  survival.  UBX0601  also 
demonstrated selectivity for elimination of senescent HRMEC over non-senescent HRMEC which is observed as decreased potency in the non-senescent 
HRMEC (Figure 4).

Figure 4: Concentration- dependent induction of apoptosis in HRMEC cells by UBX0601 in vitro

We next studied the effects of UBX1325 in the retina in an in vivo model. We employed the mouse oxygen-induced retinopathy, or OIR, model, 
which  provides  an  in  vivo  model  of  retinopathy  of  prematurity,  or  ROP,  and  DR.  In  this  model,  UBX1325  demonstrated  a  statistically  significant 
improvement in the degree of retinal neovascularization (Figure 5).

Figure 5:  Intravitreal injection of UBX1325 reduced retinal neovascularization in the mouse OIR model

Based  on  these  results  in  this  key  OIR  model,  we  believe  a  single  ocular  injection  of  UBX1325  has  the  potential  to  functionally  inhibit 
neovascularization  and  promote  vascular  repair.  We  believe  the  efficacy  of  UBX1325  in  this  OIR  model  is  due  to  elimination  of  senescent  cells  and 
accompanying SASP that propagates senescence in retinal cells and promotes neovascularization of retinal vessels.

13

 
 
 
 
We then studied the in vivo efficacy of UBX1325 in a streptozotocin-induced diabetic mouse, or STZ, model to understand its effects in a diabetic 
retina, which shows phenotypes similar to the human diseased condition. In this STZ model, UBX1325 demonstrated a significant reduction in vascular 
leakage  as  measured  by  Evans  Blue  dye  permeation  (Figure  6A).  UBX1325  also  demonstrated  an  improvement  in  the  electroretinogram,  or  ERG,  as  a 
measure of retinal/photoreceptor function (Figure 6B). At a dose of 200 pmol delivered per eye, UBX1325 led to significant increase in the amplitude of 
both the A- and B-waves (p<0.01 and p<0.0001, respectively) of the ERG when compared to the vehicle control group. Lastly, the expression of several 
disease-relevant cytokines was elevated in the diabetic retina, but attenuation of those factors was not observed after administration of UBX1325.

Figure 6:  Streptozotocin-induced diabetic mice have increased retinal vascular leakage (6A) and decreased A-wave amplitude in ERG (6B). Administration of UBX1325 
attenuated each of these disease-relevant endpoints.

Non-clinical toxicology studies of UBX1325, as well as its manufacturing and associated testing, have been completed to support the evaluation of 

the safety, tolerability, and pharmacokinetics of this molecule in further clinical studies.   

UBX1325 Clinical Data and Development Plan 

In July 2020, we filed an Investigational New Drug application, or IND, to commence a Phase 1, first-in-human, open-label, single-ascending dose 
study of UBX1325 in patients with advanced diabetic macular edema, or DME, and neovascular age-related macular degeneration, or nAMD. Our goal 
with UBX1325 is to transformationally improve outcomes for patients with DME, nAMD, and diabetic retinopathy, or DR. In October 2020, the Phase 1, 
first-in-human, clinical study of UBX1325 commenced. That study, an open-label, single ascending dose clinical trial, evaluated doses from 0.5 – 10 µg 
administered as a single intra-vitreal injection in up to 8 patients with DME and 11 patients with nAMD all of whom had been off all anti-VEGF treatment 
due to lack of benefit for at least 6 months. The results of this study demonstrated acceptable safety and tolerability without any dose-limiting toxicities; no 
evidence of intraocular inflammation; and mean improvement in BCVA of up to 9.5 ETDRS letters in those patients with DME receiving higher doses (5 
and 10 µg) and a mean improvement in BCVA of 3.2 ETDRS letters in evaluable patients with nAMD at all doses, both at 24 weeks after treatment with 
UBX1325.

In  May  2021,  we  initiated  Phase  2  of  the  BEHOLD  study  and  dosed  our  first  patient  in  June  2021.  This  study  is  a  multi-center,  randomized, 
double-masked, sham- controlled study designed to evaluate the safety, tolerability, efficacy and durability of a single 10 µg dose of UBX1325 in patients 
with  DME  evaluated  though  24  weeks.  Patients  have  the  option  of  rolling  over  to  a  48-week  long  term  extension  and  a  majority  of  patients  who  have 
completed their 24-week visits have opted to remain in the study. A total of 65 patients were enrolled, randomized evenly between UBX1325 and sham-
injected patients. These patients were being actively treated with anti-VEGF for at least 6 months prior to being randomized into the BEHOLD study (mean 
of 4.03 injections in the 6 months preceding randomization), and had persistent visual acuity deficits (73 ETDRS letters or worse, approximately 20/40 or 
worse) and residual retinal fluid (≥300 µm of central subfield thickness on optical coherence tomography, mean of approximately 439.6 µm). At the time of 
randomization, patients were taken off of their anti-VEGF treatment, and instead treated with 

14

 
 
 
 
 
UBX1325  or  a  sham  procedure.  Endpoints  being  explored  in  the  study  include  safety  and  tolerability,  changes  in  BCVA,  CST,  SRF/IRF,  proportion  of 
patients requiring rescue treatment, and durability of effects.

In August 2022, we announced positive 12- and 18-week data in our Phase 2 BEHOLD study of UBX1325 in patients with DME, including that a 
single  injection  of  UBX1325  led  to  a  progressive,  statistically  significant,  and  clinically  meaningful  improvement  in  mean  best-corrected  visual  acuity 
compared to sham treatment. At Week 18, the mean change from baseline of BCVA for UBX1325-treated subjects was an increase of 6.1 ETDRS letters 
that represents a difference of +5.0 ETDRS letters compared to sham-treated subjects (p=0.0368). In addition, patients treated with UBX1325 maintained 
central subfield thickness (CST) (+3.2 microns) compared to sham-treated patients who had progressive worsening (increase) in CST through 18 weeks 
(+53.5 microns) (p=0.0719).

In November 2022, we announced positive 24-week data in our BEHOLD study, showing that a single injection of UBX1325 led to a statistically 
significant and clinically meaningful improvement in BCVA of +6.2 ETDRS letters from baseline and +7.6 ETDRS letters compared to sham treatment 
(p=0.0084). Inclusive of rescue data, patients treated with UBX1325 had a mean improvement in BCVA of +6.4 ETDRS letters from baseline and +5.2 
ETDRS  letters  compared  to  sham  (p=0.0068).  At  24  weeks,  patients  treated  with  UBX1325  had  a  mean  change  in  CST  of  -5.4  microns  from  baseline 
compared to a worsening (increase) of +34.6 microns in sham-treated patients (p=0.1244). The proportion of rescue-free patients at 24 weeks was greater 
on UBX1325 (59.4%) as compared to sham (37.5%) with fewer total rescues and longer time-to-rescue in UBX1325-treated patients as compared to sham. 
UBX1325 demonstrated a favorable safety and tolerability profile with no cases of intraocular inflammation, retinal artery occlusion, endophthalmitis, or 
vasculitis.  Patients  will  continue  to  be  followed  through  48  weeks  post-treatment  in  a  long-term  follow-up,  with  data  expected  in  the  second  quarter  of 
2023.

In  March  2022,  we  enrolled  our  first  patient  in  Phase  2  of  the  ENVISION  study.  In  September  2022,  the  study  has  completed  enrollment  of 
patients with nAMD who have had at least two intravitreal injections of anti-VEGF therapy in the preceding six months and who still have active choroidal 
neovascularization  and  residual  sub-  or  intra-retinal  fluid.  Patients  have  received  their  last  anti-VEGF  treatment  approximately  4-8  weeks  prior  to 
screening, and all patients will be followed for approximately 24 weeks after dosing with either UBX1325 or aflibercept. We expect to announce both 16-
week and 24-week data from this Phase 2 proof-of-concept study in nAMD in late March 2023. In addition, we amended the Phase 2 ENVISION study 
including a Part B portion of the study to explore the benefit of a second cycle of two doses of UBX1325 treatment 4 weeks apart, administered at Weeks 
24 and 28 and the 

15

 
 
 
 
potential benefit of combination treatment with anti-VEGF therapy at Weeks 24 and 32 with all patients followed through Week 48. Data from Part B of the 
48-week extension study is expected in the third quarter of 2023.

In addition to UBX1325, which targets Bcl-xL, we have preclinical stage molecules that target senescent cells via alternate mechanisms and could 

be the basis of future pipeline programs.

Ophthalmology Program Targeting Tie2 Signaling

The angiopoietin-Tie2 signaling axis is believed to play a fundamental role in vascular biology. Dysregulation of the expression of Tie2-regulating 
ligands angiopoietin-2 (a context dependent Tie2 antagonist ligand) and angiopoietin-1 (a Tie2 agonist ligand) has been observed in the vitreous of patients 
with DME, AMD, and other ocular diseases. We believe that a highly specific and potent Tie2-activating antibody will restore Tie2 signaling in ocular 
tissues, potentially leading to decreased vascular leak, lower levels of pathogenic angiogenesis, and a restoration of healthy blood vessels in ischemic areas 
of  the  eye.  UBX2050  is  an  investigational  Tie2-specific  agonist  monoclonal  antibody  that  was  selected  based  on  its  optimal  binding  and  functional 
properties observed in in vitro assays. In primary human endothelial cells, or HUVECs, UBX2050 treatment activated Tie2 as measured by increased levels 
of cellular phospho-Tie2, and potently activated downstream signal transduction pathways as measured by increased levels of phospho-Akt and phospho-
Erk1/2 by western blotting (Figure 7).

Figure 7. Anti-Tie2 agonist antibody Tie2-3 (UBX2050) activated Tie2 signaling with a potency comparable to angiopoietin-1 in primary endothelial cells in 

vitro.

16

 
 
The in vivo activity of UBX2050 has been explored in a laser-induced choroidal neovascularization model in mice. In this model, UBX2050 was 
administered to mice via the intraperitoneal route at a dose of 10 mg/kg, one day prior to laser-induced rupture of Bruch’s membrane. UBX2050 treatment, 
but  not  treatment  with  a  non-specific  isotype  control  antibody,  significantly  inhibited  the  area  of  choroidal  neovascularization  nine  days  post-injury  as 
measured in retina/choroid flat mounts from treated animals (Figure 8). Based on this data, we believe UBX2050 has the potential to address pathogenic 
angiogenesis in the eyes of patients with ocular diseases such as AMD and DME.

Figure 8. UBX2050 treatment significantly inhibited choroidal neovascularization in a laser-induced injury model in mice.

We believe that the investigational Tie2 antibody (UBX2050) may be an orthogonal approach to restoring barrier function and vascular function. 

We are exploring a number of indications for UBX2050 and expect to nominate a Development Candidate by the end of 2023.

Tie2/VEGF bispecific program

Tie2  is  a  receptor  tyrosine  kinase  that  is  implicated  in  regulating  barrier  function  in  blood  vessels  of  the  eye,  which  are  affected  in  several 
prevalent eye diseases. Tie2 is an important key regulator of the vascular endothelium in the eye and dysregulation of this pathway leads to loss of barrier 
integrity  and  healthy  vasculature.  Preliminary  studies  suggest  that  cellular  senescence  in  aging  eyes  may  induce  Ang-2  and  therefore  deactivate  Tie2, 
leading to ocular edema. The Tie2/VEGF bispecific has dual functionality on two validated targets for retinal diseases. In addition to direct activation of 
Tie2, the bispecific candidate is designed to neutralize VEGF-A and VEGF-B. We believe that direct agonism of Tie2 may be superior to antagonism of 
Ang2 which relies on adequate levels of endogenous Ang1 to activate the Tie2 pathway. We have identified Tie2/VEGF bispecific molecules that have 
pharmacological activity on Tie2 and VEGF with potencies relevant for clinical benefit. Based on supporting preclinical data, we designated an Advanced 
Candidate  in  July  2022.  We  are  currently  seeking  to  initiate  pilot  preclinical  toxicology  experiments  and  other  work  to  support  nomination  of  a 
Development Candidate that should enable initiation of IND-enabling studies by the end of 2023. 

Neurology Program

UBX2089,  a  α-Klotho  hormone  drug  candidate,  is  a  circulating  hormone  primarily  produced  in  the  kidneys  and  choroid  plexus  of  the  brain, 
which is being researched for multiple neurology indications. Human genetic evidence links α-Klotho to cognitive function, and we have observed pro-
cognitive activity of recombinant α-Klotho in multiple preclinical rodent and non-human primate models. Our work focused on investigating the effect of 
UBX2089 on engaging CNS circuits in preclinical animal models with the intent of advancement to clinical studies, and in December 2021, we announced 
an exclusive licensing agreement of our α-Klotho asset to Jocasta Neuroscience, Inc. for development and commercialization.

17

 
 
 
 
Manufacturing

Our  success  will  depend  on  our  ability  to  deliver  reliable,  high-quality  preclinical  and  clinical  drug  supply.  As  we  mature  and  approach 
commercial stage operations, securing reliable high-quality commercial drug supply will be critical. We contract with third parties for the manufacture of 
our  drug  candidates  for  clinical  studies.  Because  we  rely  on  contract  manufacturers,  we  employ  personnel  with  extensive  technical,  manufacturing, 
analytical,  and  quality  experience.  Our  staff  has  strong  project  management  discipline  to  oversee  contract  manufacturing  and  testing  activities,  and  to 
compile manufacturing and quality information for our regulatory submissions. 

Manufacturing  is  subject  to  extensive  regulation  that  imposes  various  procedural  and  documentation  requirements  and  that  governs  record 
keeping, manufacturing processes and controls, personnel, quality control and quality assurance, and more. Our systems and our contractors are required to 
be in compliance with these regulations, and compliance is assessed regularly through monitoring of performance and a formal audit program. 

Our current supply chains for our lead drug candidates involve several manufacturers that specialize in specific operations of the manufacturing 
process, specifically, raw materials manufacturing, drug substance manufacturing, drug product manufacturing, and drug product labeling, packaging, and 
storage. We currently operate under purchase order programs for our drug candidates with Material Service Agreements in place, and we intend to establish 
long-term  supply  agreements  in  the  future.  We  believe  our  current  manufacturers  have  the  scale,  the  systems,  and  the  experience  to  supply  all  planned 
clinical studies. 

We do not currently require commercial manufacturing capabilities. Should our needs change, we will likely need to scale up our manufacturing 
processes to enable commercial launch. To ensure continuity in our supply chain, we plan to establish supply arrangements with alternative larger scale 
suppliers for certain portions of our supply chain, as appropriate. 

Commercialization Plan

We do not currently have, nor do we expect to have in the near term, any FDA-approved drugs in our portfolio. Therefore, we have not yet built an 

infrastructure for sales, marketing, or commercial distribution. 

Should  any  of  our  drug  candidates  move  into  pivotal  clinical  trials  intended  to  support  an  application  for  market  authorization,  we  intend  to 

develop a plan to commercialize them in the United States and other key markets, through an internal infrastructure or external partnerships. 

Competition

The biotechnology and pharmaceutical industries, including the field of research in aging, are typically rife with rapid technological developments, 
bold competition, and dependence on intellectual property. Like any biotechnology company, we face competition from multiple sources, including large or 
established  pharmaceutical,  biotechnology,  and  wellness  companies,  academic  research  institutions,  government  agencies,  and  private  institutions.  We 
believe our drug candidates will prevail amid the competitive landscape through their efficacy, safety, administration methods and convenience, cost, public 
and institutional demand, intellectual property portfolio, and treatment of the root cause of many diseases of aging. 

We  are  aware  of  other  companies  seeking  to  develop  treatments  to  prevent  or  treat  diseases  of  aging  through  various  biological  pathways, 
including several large pharmaceutical companies that have exploratory programs as well as a number of earlier-stage companies. Most of these companies 
are either in early stages of discovery research in senescence or have not yet disclosed pipeline candidates or mechanisms of interest, and those companies 
that  have  disclosed  pipeline  candidates  are  targeting  other  pathways.  Hence,  we  believe  that  we  currently  have  the  most  advanced  program  addressing 
cellular senescence. 

Our  drug  candidates  are  likely  to  compete  against  current  therapies  from  a  wide  range  of  companies  and  technologies,  including  therapies  for 

ophthalmology diseases: current standard of care treatments include anti-VEGF 

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antibodies  (bevacizumab,  ranibizumab,  aflibercept,  brolucizumab);  VEGF/Ang2  bispecific  antibodies  (faricimab);  intravitreal  steroid  (dexamethasone); 
pan-retinal  photocoagulation  by  laser  for  both  neovascular  AMD,  DR,  and  DME;  and  possibly  complement  inhibitors  (e.g.,  pegcetacoplan)  for  the 
geographic atrophy form of AMD.

  Many  of  our  competitors,  either  alone  or  with  strategic  partners,  have  substantially  greater  financial,  technical,  and  human  resources  than  we  do.  
Accordingly,  our  competitors  may  be  more  successful  in  obtaining  approval  for  treatments  and  achieving  widespread  market  acceptance,  rendering  our 
treatments obsolete or non-competitive. Accelerated merger and acquisition activity in the biotechnology and biopharmaceutical industries may result in 
even more resources concentrated among a smaller number of our competitors. These companies also compete with us in recruiting and retaining qualified 
scientific and management personnel, establishing clinical study sites, patient registration for clinical studies, and 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. Our commercial opportunity could be substantially limited in the event that our competitors develop 
and commercialize products that are more effective, safer, more tolerable, more convenient, or less expensive than our comparable products. In geographies 
that  are  critical  to  our  commercial  success,  competitors  may  also  obtain  regulatory  approvals  before  us,  resulting  in  our  competitors  building  a  strong 
market  position  in  advance  of  our  products’  entry.  We  believe  the  factors  determining  the  success  of  our  programs  will  be  the  efficacy,  safety,  and 
convenience of our drug candidates. 

Intellectual Property

Our success depends in large part upon our ability to obtain and maintain proprietary protection for our products and technologies and to operate 
without infringing the proprietary rights of others. Our policy is to protect our proprietary position by, among other methods, filing U.S. and foreign patent 
applications  that  relate  to  our  proprietary  technologies,  inventions  and  improvements  that  are  important  to  the  development  and  implementation  of  our 
business. We also rely on trademarks, know-how, continuing technological innovation and licensing opportunities to develop and maintain our proprietary 
position. 

Patent Portfolio 

Our patent portfolio consists of a combination of issued and allowed patents and pending patent applications that are owned or co-owned by us 
and/or licensed to us from third parties. The majority of these patents and applications cover our cellular senescence program, and others pertain to our 
programs that target aging mechanisms beyond cellular senescence, including the administration of a Tie2 receptor agonist or α-Klotho hormone. As of 
March 1, 2023, we own, co-own, or have an exclusive license in certain fields of use to more than 150 patents and pending applications in the United States 
and  foreign  jurisdictions.  This  portfolio  includes  37  issued  and  allowed  U.S.  patents  and  applications  and  46  granted  and  allowed  foreign  patents  and 
applications, respectively. 

In general, patents have a term of 20 years from the earliest claimed non-provisional priority date. The patent term may be extendible by up to five 
years  in  certain  countries  by  means  of  patent  term  extension  depending  on  the  regulatory  pathway  and  the  remaining  term  upon  marketing  approval. 
Certain  other  patents  and  patent  applications  directed  to  our  patent  portfolio,  if  they  were  to  issue,  may  have  later  expiration  dates.  Any  pending  U.S. 
provisional application is not eligible to become an issued patent until, among other things, we file a non-provisional patent application within 12 months 
of  filing  the  related  provisional  patent  application.  If  we  do  not  timely  file  any  non-provisional  patent  application,  we  may  lose  our  priority  date  with 
respect to our provisional patent application and any patent protection on the inventions disclosed in our provisional patent application.

Ophthalmology Programs 

We have a license with Ascentage to two patent families of issued and pending composition of matter patents directed to specific Bcl-xL inhibitors 
including  UBX0601,  the  active  parent  molecule  of  our  lead  drug  candidate,  UBX1325.  This  license  grants  us  exclusive  development  and 
commercialization  rights  and  non-exclusive  manufacturing  rights  to  UBX1325  for  all  non-oncology  indications  outside  of  Greater  China  (China,  Hong 
Kong, Macau and Taiwan). Inside Greater China, we have the right to negotiate a joint venture with Ascentage to develop, 

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manufacture and commercialize UBX1325. Patents in these two patent families have been granted in the United States, South Korea, New Zealand, South 
Africa, Australia, Canada, China, India, Singapore, Japan and Europe, and others are pending in India and Singapore. Patents that issue from these two 
patent families are expected to expire in 2032 and 2034, excluding any patent term adjustments or extensions. 

Our  license  agreement  with  Ascentage  also  grants  us  the  right  to  continue  our  preclinical  development  efforts  with  UBX1967  (our  back-up 
compound  to  UBX1325)  until  the  time  we  wish  to  submit  an  IND  for  UBX1967,  at  which  point  we  would  be  required  to  enter  into  a  separate  license 
agreement with Ascentage covering UBX1967.  

We co-own a patent family encompassing the use of Bcl-2 and Bcl-xL inhibitors generally to treat various age-related eye diseases by targeting 
senescent cells (which also covers aspects of our neurology programs) with the Buck Institute and the Mayo Clinic. We have exclusive licenses from each 
of the Buck Institute and the Mayo Clinic to this patent family in the field of senescence. To date, three U.S. patents and a European, a New Zealand, a 
Hong  Kong,  and  a  South  Africa  patent  have  issued  in  this  patent  family  which  are  directed  to  treating  age  related  eye  diseases,  including  age-related 
macular degeneration. Other patent applications are pending in the United States, Australia, Canada, China, Europe, Israel, Japan, Mexico, Singapore and 
South Korea. Patents that issue from this family are expected to expire in 2035, excluding any patent term adjustments and patent term extensions.

We  also  solely  own  a  patent  family  that  specifically  claims  the  composition  of  matter  of  UBX1325  and  closely  related  compounds,  as  well  as 
general  methods  of  use  of  UBX1325.  As  of  March  1,  2023  we  have  two  issued  U.S.  patents  and  one  pending  U.S.  application  as  well  as  pending 
applications in Australia, Canada, China, Europe, Japan, Hong Kong, and South Korea. Future patents issued from this family are expected to expire in 
2039, excluding any patent term adjustments and patent term extensions.

We  solely  own  a  patent  family  that  specifically  covers  the  sequence,  epitope,  alternative  antibody  formats,  and  use  of  UBX2050  not  only  for 
ophthalmic diseases, but also other indications, including kidney. Future patents issuing from this family are expected to expire in 2040, excluding any 
patent term adjustments and patent term extensions. We also solely own a U.S. provisional patent application that specifically covers the sequences of our 
Tie2/VEGF bispecific UBX2048 and variants for many indications, including ocular. Future patents issuing from this family are expected to expire in 2043, 
excluding any patent term adjustments and patent term extensions.

Neurology Program

We have an exclusive license with The Regents of the University of California for a patent family directed to methods of treatment and the use of 
α-Klotho hormone for the development of human therapeutics to treat cognitive decline. As of March 1, 2023, our patent portfolio includes three issued 
U.S. patents, an issued patent in Australia, Europe, and Japan, one pending patent application in each of the United States, Australia, Canada, Europe, Hong 
Kong, and India and two pending patent applications in China. Patents that issue from this family are expected to expire in 2036, excluding any patent term 
adjustments and patent term extensions. In December 2021, we announced an exclusive agreement licensing our α-Klotho asset to Jocasta Neuroscience, 
Inc. for development and commercialization.

We co-own a patent family encompassing the use of Bcl-2/xL inhibitors generally to treat neurodegenerative diseases by targeting senescent cells 
(which also covers aspects of our ophthalmology program) with the Buck Institute and the Mayo Clinic. We have exclusive licenses from each of the Buck 
Institute and the Mayo Clinic to this patent family in the field of senescence. Currently, we co-own a pending U.S. patent application for the use of Bcl-xL 
inhibition to eliminate senescent cells to treat neurodegenerative disorders. Patents that issue from this family are expected to expire in 2035, excluding any 
patent term adjustments and patent term extensions.

Other Intellectual Property 

Our continuing research and development, technical know-how, and contractual arrangements supplement our intellectual property protection to 
maintain our competitive position. Our policy is to require inventors who are identified on any Company-owned patent applications to assign rights to us. 
We also have confidentiality agreements 

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with  our  employees,  consultants,  and  other  advisors  to  protect  our  proprietary  information.  Our  policy  is  to  require  third  parties  that  receive  material 
UNITY confidential information to enter into confidentiality agreements with us. 

We  also  protect  our  brand  through  procurement  of  trademark  rights.  As  of  March  1,  2023,  the  mark  UNITY  BIOTECHNOLOGY®  and  the 
UNITY BIOTECHNOLOGY® design logo are registered in the United States, the European Union, or EU, China, and in Japan, as well as other foreign 
jurisdictions.  The  mark  UNITY®  is  also  registered  in  the  United  States  and  in  the  EU.  In  order  to  supplement  protection  of  our  brand,  we  have  also 
registered several internet domain names.

Description of Ascentage Agreements 

Licenses and Collaborations

We  were  a  party  to  three  agreements,  or  the  Commercial  Agreements,  with  Ascentage  Pharma:  (a)  a  compound  library  and  option  agreement 
executed in February 2016, the Library Agreement, granting the Company the right to research and nominate an active compound from Ascentage’s library 
of Bcl compounds and subsequently nominate a development candidate from any active compound in order to begin GLP toxicology work for indications 
outside of oncology, which expired in February 2022; (b) a license agreement executed in February 2016 granting the Company rights to an Ascentage 
Pharma compound known as APG1252, or the APG1252 License Agreement, which the Company terminated in July 2020 due to the Company’s decision 
to prioritize the progression of UBX1325;and (c) a second license agreement executed in January 2019 granting the Company world-wide rights to develop 
and commercialize UBX0601, the active parent molecule of our lead drug candidate UBX1325, outside of Greater China, or the Original Bcl Agreement, 
for indications outside of oncology. 

The Commercial Agreements referenced above include cash payments of up to $70.3 million as well as the equity payments of up to an aggregate 
of (a) 93,333 shares of common stock in the event there is only one licensed product; and (b) 133,333 shares of common stock in the event there are two or 
more licensed products, in each case to be issued based on the Company’s achievement of certain preclinical and clinical development and sales milestone 
events. The Company is required to make 80% of all equity payments to Ascentage Pharma and the remaining 20% to an academic institution from whom 
Ascentage  Pharma  had  previously  licensed  the  technology.  The  milestones  include  the  advancement  of  additional  compounds  into  Investigational  New 
Drug application , or IND, enabling studies, the filing of an IND, the commencement of clinical studies, Food and Drug Administration, or FDA, and/or 
European Medicines Agency approval, and a net sales threshold. The Original Bcl License Agreement also includes tiered royalties in the low-single digits 
based on sales of licensed products.    

The Commercial Agreements referenced above include cash payments of up to $70.3 million as well as the equity payments of up to an aggregate 
of (a) 93,333 shares of common stock in the event there is only one licensed product, and (b) 133,333 shares of common stock in the event there are two or 
more licensed products, in each case to be issued based on the Company’s achievement of certain preclinical and clinical development and sales milestone 
events. The Company is required to make 80% of all equity payments to Ascentage Pharma and the remaining 20% to an academic institution from whom 
Ascentage  Pharma  had  previously  licensed  the  technology.  The  milestones  include  the  advancement  of  additional  compounds  into  Investigational  New 
Drug application, or IND, enabling studies, the filing of an IND, the commencement of clinical studies, Food and Drug Administration, or FDA, and/or 
European Medicines Agency approval, and a net sales threshold. The Original Bcl License Agreement also includes tiered royalties in the low-single digits 
based on sales of licensed products.    

As  of  December  31,  2022,  pursuant  to  the  Commercial  Agreements,  the  Company  had  issued  126,975  shares  of  common  stock  to  Ascentage 
Pharma  and  29,194  shares  of  common  stock  to  the  academic  institution  from  whom  Ascentage  Pharma  had  previously  licensed  the  technology.  The 
Company had issued no additional shares pursuant to the Commercial Agreements during the year ended December 31, 2022. In May 2021, the Company 
initiated a Phase 2 proof-of-concept study of UBX1325 in patients with diabetic macular edema. As a result of the first patient dosed in the Phase 2 proof-
of-concept UBX1325 study in June 2021, the Company triggered a milestone payment of $2.0 million for Ascentage Pharma, which the Company elected 
to settle in shares of the Company’s common stock. At the instruction of Ascentage Pharma, the Company issued 29,477 shares of its common stock to 
Ascentage Pharma as of August 2021 with a fair market value of $1.1 million net of withholding taxes, and 10,527 shares of its common 

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stock  to  the  academic  institution  with  a  fair  market  value  of  $0.4  million  at  settlement  date.  The  milestone  payment  was  recognized  as  research  and 
development  expense  in  the  statement  of  operations  and  comprehensive  loss  during  the  year  ended  December  31,  2021.  The  Company  had  previously 
issued 36,166 shares of its common stock with a value of $2.3 million to Ascentage Pharma as of December 31, 2020.

The  Commercial  Agreements  included  contingent  consideration  in  the  form  of  additional  issuances  of  shares  of  the  Company’s  common  stock 
based  on  the  achievement  of  the  specified  milestones.  Upon  the  July  2020  termination  of  the  license  to  APG1252,  the  Company  determined  that  the 
contingency no longer applied and adjusted the fair value of the contingent consideration liability to zero. To date, no royalties were due from the sales of 
licensed products.

Under  the  terms  of  the  Original  Bcl  Agreement,  Ascentage  granted  us  the  following  rights  for  all  non-oncology  indications  outside  of  Greater 
China (China, Hong Kong, Macau and Taiwan): (i) exclusive worldwide development rights, and (ii) exclusive commercialization rights. Inside Greater 
China we have the right to negotiate a joint venture with Ascentage to develop, manufacture and commercialize UBX1325. The Original Bcl Agreement 
also stipulates that Ascentage has the right to manufacture at least 50% of our supply requirements of the licensed compound, provided they achieve and 
maintain  certain  manufacturing  quality  standards.  This  Original  Bcl  Agreement  was  amended  in  the  fourth  quarter  of  2019  to  remove  certain  field  and 
territory  limitations  and  to  amend  the  schedule  of  licensed  patents  related  to  UBX1967,  and  then  amended  again  in  the  first  quarter  of  2020  to  further 
amend and restate the schedule of licensed patents. This Original Bcl Agreement was amended a third time in June 2020 to switch the status of UBX1967 
from Licensed Compound to back-up compound, and conversely the status of UBX1325 from back-up to Licensed Compound. 

Additional License Agreements 

We  are  party  to  two  additional  license  agreements  that  support  our  senescence-related  patent  portfolio.  These  agreements  are  with  an  entity 
affiliated with the Mayo Clinic, or Mayo, and the Buck Institute for Research on Aging, or Buck, and provide us with a worldwide, exclusive, sublicensable 
license  under  those  counter-parties’  rights  to  a  patent  family  that  is  co-owned  by  Buck,  Mayo  and  us  to  develop  and  commercialize  licensed  products, 
including for the treatment of senescence-related diseases in therapeutic areas including ophthalmology and neurological diseases. 

Under our June 2013 license with Mayo, we may be obligated to make development and sales milestone payments to Mayo of up to $10.8 million 
in  the  aggregate,  to  pay  Mayo  a  percentage  of  certain  sublicensing  revenue  that  is  between  the  high-single  digits  and  the  low-teens,  and  to  pay  Mayo 
running  royalty  payments  ranging  from  less  than  1%  to  low-single  digit  percentages  on  net  sales  of  licensed  products.  Our  obligation  to  pay  running 
royalties to Mayo under the agreement is subject to a non-material minimum annual royalty and could potentially extend until January 1, 2037. We also 
issued 67,796 shares of our common stock to Mayo under this agreement. Our agreement with Mayo continues until the later of (i) the expiration of the last 
valid  claim  within  the  licensed  patents  and  (ii)  13  years  after  first  commercial  sale  of  the  first  licensed  product.  We  may  terminate  the  agreement  for 
convenience, and either party may terminate the agreement for the other party’s uncured material breach. 

Under our January 2017 license with Buck, which includes similar rights to a second patent family that is co-owned only by Buck and us, we may 
be obligated to make development and sales milestone payments to Buck of up to $5.4 million in the aggregate, to pay Buck a mid-single digit percentage 
of  certain  sublicensing  revenue,  and  to  pay  Buck  running  royalty  payments  ranging  from  less  than  1%  to  low-single  digit  percentages  on  net  sales  of 
licensed products. Our obligation to pay running royalties to Buck under the agreement is subject to a non-material minimum annual royalty and could 
potentially  extend  until  January  1,  2037.  We  also  issued  13,220  shares  of  our  common  stock  to  Buck  under  this  agreement.  The  term  of  our  license 
agreement with Buck continues until the expiration of all our payment obligations to Buck thereunder. We may terminate the agreement for convenience, 
and either party may terminate the agreement for the other party’s uncured material breach. 

We are also party to license agreements relating to our α-Klotho program. In May 2019, we entered into an exclusive license with The Regents of 
the University of California for intellectual property and know-how for the development of human therapeutics to treat cognitive decline in exchange for 
development and sales milestones and low single-digit percentages on net sales of licensed products. In December 2021, we signed an exclusive license 

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agreement licensing our rights in the α-Klotho asset to Jocasta Neuroscience, Inc. for development and commercialization, under which we received a $5 
million upfront cash payment from Jocasta, and we will also receive additional payments based on development milestones, approval milestones, and sales-
based royalties, per indication. 

Government Regulation 

Government  authorities  in  the  United  States  (including  federal,  state  and  local  authorities)  and  in  other  countries,  extensively  regulate,  among 
other things, the manufacturing, research and clinical development, marketing, labeling and packaging, storage, distribution, post-approval monitoring and 
reporting, advertising and promotion, pricing, and export and import of pharmaceutical products, such as those we are developing. The process of obtaining 
regulatory approvals and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations require the expenditure of 
substantial time and financial resources. 

U.S. Government Regulation 

In the United States, the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act, or FDCA, and its implementing regulations, and 
biologics  under  the  FDCA  and  the  Public  Health  Service  Act,  or  PHSA,  and  its  implementing  regulations.  FDA  approval  is  required  before  any  new
unapproved drug or dosage form, including a new use of a previously approved drug, can be marketed in the United States. Drugs and biologics are also 
subject to other federal, state and local statutes and regulations. If we fail to comply with applicable FDA or other requirements at any time during the drug 
development  process,  clinical  testing,  the  approval  process  or  after  approval,  we  may  become  subject  to  administrative  or  judicial  sanctions.  These 
sanctions could include the FDA’s refusal to approve pending applications, license suspension or revocation, withdrawal of an approval, warning letters, 
product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, civil penalties or criminal prosecution. 

The process required by the FDA before drug candidates may be marketed in the United States generally involves the following: 

completion of extensive preclinical laboratory tests and preclinical animal studies, all performed in accordance with GLP regulations; 

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

approval by an independent institutional review board, or IRB, or ethics committee representing each clinical site before each clinical study may 
be initiated; 

performance of adequate and well-controlled human clinical studies to establish the safety and efficacy, or in the case of a biologic, the safety, 
purity and potency, of the drug candidate for each proposed indication; 

preparation of and submission to the FDA of a new drug application, or NDA, or biologics license application, or BLA, after completion of all 
pivotal clinical studies; 

review of the product application by an FDA advisory committee, where appropriate and if applicable; 

a determination by the FDA within 60 days of its receipt of an NDA or BLA to file the application for review;  

satisfactory  completion  of  an  FDA  pre-approval  inspection  of  the  manufacturing  facilities  where  the  drug  candidate  is  produced  to  assess 
compliance with current Good Manufacturing Practices, or cGMP; and 

FDA review and approval of an NDA or BLA prior to any commercial marketing or sale of the drug or biologic in the United States. 

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An IND is a request for authorization from the FDA to administer an investigational new drug product to humans. The central focus of an IND 
submission  is  on  the  general  investigational  plan  and  the  protocol(s)  for  human  studies.  The  IND  also  includes  results  of  animal  and  in  vitro  studies 
assessing  the  toxicology,  pharmacokinetics,  pharmacology  and  pharmacodynamic  characteristics  of  the  product;  chemistry,  manufacturing  and  controls 
information; and any available human data or literature to support the use of the investigational new drug. An IND 

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must  become  effective  before  human  clinical  studies  may  begin.  An  IND  will  automatically  become  effective  30  days  after  receipt  by  the  FDA,  unless 
before that time the FDA raises concerns or questions related to the proposed clinical studies. In such a case, the IND may be placed on clinical hold and 
the IND sponsor and the FDA must resolve any outstanding concerns or questions before clinical studies can begin. Accordingly, submission of an IND 
may or may not result in the FDA allowing clinical studies to commence. 

Clinical Studies 

Clinical studies involve the administration of the investigational new drug to human subjects under the supervision of qualified investigators in 
accordance with Good Clinical Practice regulations, or GCPs, which include the requirement that all research subjects provide their informed consent for 
their  participation  in  any  clinical  study.  Clinical  studies  are  conducted  under  protocols  detailing,  among  other  things,  the  objectives  of  the  study,  the 
parameters  to  be  used  in  monitoring  safety  and  the  efficacy  criteria  to  be  evaluated.  A  protocol  for  each  clinical  study  and  any  subsequent  protocol 
amendments must be submitted to the FDA as part of the IND. Additionally, approval must also be obtained from each clinical study site’s IRB before the 
studies  may  be  initiated,  and  the  IRB  must  monitor  the  study  until  completed.  There  are  also  requirements  governing  the  reporting  of  ongoing  clinical 
studies and clinical study results to public registries. 

The  clinical  investigation  of  a  drug  or  biologic  is  generally  divided  into  three  or  four  phases.  Although  the  phases  are  usually  conducted 

sequentially, they may overlap or be combined. 

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Phase 1.  The drug or biologic is initially introduced into healthy human subjects or patients with the target disease or condition. These studies are 
designed  to  evaluate  the  safety,  dosage  tolerance,  metabolism  and  pharmacologic  actions  of  the  investigational  new  drug  in  humans,  the  side 
effects associated with increasing doses, and if possible, to gain early evidence on effectiveness. 

Phase 2.  The drug or biologic is administered to a limited patient population to evaluate dosage tolerance and optimal dosage, identify possible 
adverse side effects and safety risks and preliminarily evaluate efficacy. 

Phase  3.  The  drug  or  biologic  is  administered  to  an  expanded  patient  population,  generally  at  geographically  dispersed  clinical  study  sites  to 
generate  enough  data  to  statistically  evaluate  dosage,  clinical  effectiveness  and  safety,  to  establish  the  overall  benefit-risk  relationship  of  the 
investigational product and to provide an adequate basis for product approval. 

Phase 4.  In  some  cases,  the  FDA  may  condition  approval  of  an  NDA  or  BLA  for  a  drug  candidate  on  the  sponsor’s  agreement  to  conduct  
additional clinical studies after approval. In other cases, a sponsor may voluntarily conduct additional clinical studies after approval to gain more 
information about the drug. Such post-approval studies are typically referred to as Phase 4 clinical studies. 

A  pivotal  study  is  a  clinical  study  that  adequately  meets  regulatory  agency  requirements  for  the  evaluation  of  a  drug  candidate’s  efficacy  and 
safety such that it can be used to justify the approval of the product. Generally, pivotal studies are Phase 3 studies, but the FDA may accept results from 
Phase 2 studies if the study design provides a well-controlled and reliable assessment of clinical benefit, particularly in situations where there is an unmet 
medical need and the results are sufficiently robust. 

The FDA, the IRB or the clinical study sponsor may suspend or terminate a clinical study at any time on various grounds, including a finding that 
the  research  subjects  are  being  exposed  to  an  unacceptable  health  risk.  Additionally,  some  clinical  studies  are  overseen  by  an  independent  group  of 
qualified experts organized by the clinical study sponsor, known as a data safety monitoring board or committee. This group provides authorization for 
whether  or  not  a  study  may  move  forward  at  designated  check  points  based  on  access  to  certain  data  from  the  study.  A  sponsor  may  also  suspend  or 
terminate a clinical study based on evolving business objectives and/or competitive climate.  

Submission of an NDA or BLA to the FDA 

Assuming  successful  completion  of  all  required  testing  in  accordance  with  all  applicable  regulatory  requirements,  detailed  investigational  new 

drug product information is submitted to the FDA in the form of an NDA 

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or BLA requesting approval to market the product for one or more indications. Under federal law, the submission of most NDAs and BLAs is subject to a 
substantial application user fee. Applications for orphan drug products are exempted from the NDA and BLA application user fees. 

An NDA or BLA must include all relevant data available from pertinent preclinical and clinical studies, including negative or ambiguous results as 
well  as  positive  findings,  together  with  detailed  information  relating  to  the  product’s  chemistry,  manufacturing,  controls  and  proposed  labeling,  among 
other things. Data can come from company-sponsored clinical studies intended to test the safety and effectiveness of a use of a product, or from a number 
of  alternative  sources,  including  studies  initiated  by  investigators.  To  support  marketing  approval,  the  data  submitted  must  be  sufficient  in  quality  and 
quantity to establish the safety and effectiveness of the investigational product to the satisfaction of the FDA. 

Once an NDA or BLA has been submitted, the FDA’s goal is to review the application within ten months after it accepts the application for filing, 
or, if the application receives priority review, six months after the FDA accepts the application for filing. The review process is often significantly extended 
by FDA requests for additional information or clarification. 

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

The FDA is required to refer an application for a novel drug or biologic to an advisory committee or explain why such referral was not made. An 
advisory  committee  is  a  panel  of  independent  experts,  including  clinicians  and  other  scientific  experts,  that  reviews,  evaluates  and  provides  a 
recommendation  as  to  whether  the  application  should  be  approved  and  under  what  conditions.  The  FDA  is  not  bound  by  the  recommendations  of  an 
advisory committee, but it considers such recommendations carefully when making decisions and typically follows such recommendations. 

The FDA’s Decision on an NDA or BLA 

After  the  FDA  evaluates  the  NDA  or  BLA  and  conducts  inspections  of  manufacturing  facilities,  it  may  issue  an  approval  letter  or  a  Complete 
Response Letter. An approval letter authorizes commercial marketing of the drug or biologic with specific prescribing information for specific indications. 
A  Complete  Response  Letter  indicates  that  the  review  cycle  of  the  application  is  complete  and  the  application  is  not  ready  for  approval.  A  Complete 
Response Letter may require additional clinical data and/or an additional pivotal Phase 3 clinical study(ies), and/or other significant, expensive and time-
consuming requirements related to clinical studies, preclinical studies or manufacturing. Even if such additional information is submitted, the FDA may 
ultimately decide that the NDA or BLA does not satisfy the criteria for approval. The FDA could also approve the NDA or BLA with a Risk Evaluation 
and Mitigation Strategy, or REMS, to mitigate risks, which could include medication guides, physician communication plans or elements to assure safe use, 
such as restricted distribution methods, patient registries and other risk minimization tools. The FDA also may condition approval on, among other things, 
changes to proposed labeling, development of adequate controls and specifications or a commitment to conduct one or more post-market studies or clinical 
studies. Such post-market testing may include Phase 4 clinical studies and surveillance to further assess and monitor the product’s safety and effectiveness 
after commercialization. Also, new government requirements, including those resulting from new legislation, may be established, or the FDA’s policies 
may change, which could delay or prevent regulatory approval of our products under development. 

Expedited Review and Accelerated Approval Programs 

The FDA has various programs, including fast track designation, breakthrough therapy designation, accelerated approval, and priority review, that 
are intended to expedite the development and approval of new drugs and biologics that address unmet medical needs in the treatment of serious or life-
threatening diseases and conditions. To be eligible for a fast track designation, the FDA must determine, based on the request of a sponsor, that a product is 
intended to treat a serious or life-threatening disease or condition and demonstrates the potential to address an unmet 

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medical need. The FDA may review sections of the NDA for a fast-track product on a rolling basis before the complete application is submitted, if the 
sponsor provides a schedule for the submission of the sections of the NDA, the FDA agrees to accept sections of the NDA and determines that the schedule 
is acceptable, and the sponsor pays any required user fees upon submission of the first section of the NDA. 

The  FDA  may  give  a  priority  review  designation  to  drugs  or  biologics  that  are  designed  to  treat  a  serious  condition  and,  if  approved,  would 
provide a significant improvement in safety or effectiveness compared to available therapies. A priority review means that the goal for the FDA to review 
an application is six months, rather than the standard review of ten months. These six- and 10-month review periods are measured from the “filing” date 
rather than the receipt date for NDAs for new molecular entities, which typically adds approximately two months to the timeline for review and decision 
from the date of submission. Products that are eligible for fast-track designation may also be eligible for priority review. 

In  addition,  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 and may be approved on the basis of adequate and well-controlled 
clinical  studies  establishing  that  the  product  has  an  effect  on  a  surrogate  endpoint  that  is  reasonably  likely  to  predict  clinical  benefit,  or  on  a  clinical 
endpoint  that  can  be  measured  earlier  than  irreversible  morbidity  or  mortality,  that  is  reasonably  likely  to  predict  an  effect  on  irreversible  morbidity  or 
mortality or other clinical benefit, taking into account the severity, rarity or prevalence of the condition and the availability or lack of alternative treatments. 
As  a  condition  of  approval,  the  FDA  may  require  a  sponsor  of  a  drug  receiving  accelerated  approval  to  perform  post-marketing  studies  to  verify  and 
describe  the  predicted  effect  on  irreversible  morbidity  or  mortality  or  other  clinical  endpoint,  and  the  drug  or  biologic  may  be  subject  to  expedited 
withdrawal  procedures  if  the  sponsor  fails  to  conduct  the  required  post-marketing  studies,  or  such  post-marketing  studies  fail  to  confirm  the  predicted 
clinical benefit. 

Moreover, under the provisions of the Food and Drug Administration Safety and Innovation Act, or FDASIA, passed in July 2012, a sponsor can 
request designation of a product candidate as a “breakthrough therapy.” A breakthrough therapy is defined as a drug or biologic that is intended, alone or in 
combination with one or more other drugs or biologics, to treat a serious or life-threatening disease or condition, and preliminary clinical evidence indicates 
that  the  product  may  demonstrate  substantial  improvement  over  existing  therapies  on  one  or  more  clinically  significant  endpoints,  such  as  substantial 
treatment effects observed early in clinical development. This designation includes all of the features of fast track designation, as well as more intensive 
FDA interaction and guidance. The breakthrough therapy designation is a distinct status from both accelerated approval and priority review, but these can 
also be granted to the same product candidate if the relevant criteria are met. The FDA must take certain actions, such as holding timely meetings and 
providing advice, intended to expedite the development and review of an application for approval of a breakthrough therapy.

Fast  track  designation,  priority  review,  and  breakthrough  therapy  designation  do  not  change  the  standards  for  approval  but  may  expedite  the 
development or approval process. Even if a product qualifies for one or more of these programs, the FDA may later decide that the product no longer meets 
the conditions for qualification or decide that the time period for FDA review or approval will not be shortened. 

Post-Approval Requirements 

Drugs and biologics marketed pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other 
things, requirements relating to recordkeeping, periodic reporting, product sampling and distribution, advertising and promotion and reporting of adverse 
experiences with the product. After approval, most changes to the approved product, such as adding new indications or other labeling claims are subject to 
prior FDA review and approval. There also are continuing, annual user fee requirements. 

Manufacturers are subject to periodic unannounced inspections by the FDA and state agencies for compliance with cGMP requirements. Changes 
to  the  manufacturing  process  are  strictly  regulated  and,  depending  on  the  significance  of  the  change,  may  require  prior  FDA  approval  before  being 
implemented.  FDA  regulations  also  require  investigation  and  correction  of  any  deviations  from  cGMP  and  impose  reporting  and  documentation 
requirements upon us and any third-party manufacturers that we may decide to use. Accordingly, manufacturers must continue to 

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expend time, money and effort in the area of production and quality control to maintain compliance with cGMP and other aspects of regulatory compliance. 

Discovery of previously unknown problems with a product or the failure to comply with applicable requirements may result in restrictions on a 
product, manufacturer or holder of an approved NDA or BLA, including withdrawal or recall of the product from the market or other voluntary, FDA-
initiated  or  judicial  action  that  could  delay  or  prohibit  further  marketing.  Also,  new  government  requirements,  including  those  resulting  from  new 
legislation, may be established, or the FDA’s policies may change, which could delay or prevent regulatory approval of our products under development. 

The  FDA  may  withdraw  approval  if  compliance  with  regulatory  requirements  and  standards  is  not  maintained  or  if  problems  occur  after  the 
product  reaches  the  market.  Later  discovery  of  previously  unknown  problems  with  a  product,  including  adverse  events  of  unanticipated  severity  or 
frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new 
safety  information;  imposition  of  post-market  studies  or  clinical  studies  to  assess  new  safety  risks;  or  imposition  of  distribution  restrictions  or  other 
restrictions under a REMS program. Other potential consequences include, among other things: 

•

•

•

•

•

•

restrictions on the marketing or manufacturing of the product;  

complete withdrawal of the product from the market or product recalls; 

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

refusal  of  the  FDA  to  approve  pending  NDAs  or  BLAs  or  supplements  to  approved  NDAs  or  BLAs,  or  suspension  or  revocation  of  product 
licenses or approvals; 

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

injunctions or the imposition of civil or criminal penalties. 

The FDA strictly regulates marketing, labeling, advertising and promotion of products that are placed on the market. Drugs may be promoted only 
for  the  approved  indications  and  in  accordance  with  the  provisions  of  the  approved  label.  The  FDA  and  other  agencies  actively  enforce  the  laws  and 
regulations  prohibiting  the  promotion  of  off-label  uses,  and  a  company  that  is  found  to  have  improperly  promoted  off-label  uses  may  be  subject  to 
significant liability. 

Orphan Designation and Exclusivity 

Under the Orphan Drug Act, the FDA may grant orphan designation to a drug or biologic intended to treat a rare disease or condition, defined as a 
disease  or  condition  with  a  patient  population  of  fewer  than  200,000  individuals  in  the  United  States,  or  a  patient  population  greater  than  200,000 
individuals in the United States and when there is no reasonable expectation that the cost of developing and making available the drug or biologic in the 
United States will be recovered from sales in the United States for that drug or biologic. Orphan drug designation must be requested before submitting a 
BLA  or  NDA.  After  the  FDA  grants  orphan  drug  designation,  the  generic  identity  of  the  therapeutic  agent  and  its  potential  orphan  use  are  disclosed 
publicly by the FDA. 

If a product that has orphan drug designation subsequently receives the first FDA approval for a particular active ingredient for the disease for 
which it has such designation, the product is entitled to orphan product exclusivity, which means that the FDA may not approve any other applications, 
including  a  full  NDA  or  BLA,  to  market  the  same  drug  or  biologic  for  the  same  indication  for  seven  years,  except  in  limited  circumstances,  such  as  a 
showing of clinical superiority to the product with orphan drug exclusivity or if FDA finds that the holder of the orphan drug exclusivity has not shown that 
it can assure the availability of sufficient quantities of the orphan drug to meet the needs of patients with the disease or condition for which the drug was 
designated. Orphan drug exclusivity does not prevent the FDA from approving a different drug or biologic for the same disease or condition, or the same 
drug or biologic for a different disease or condition. Among the other benefits of orphan drug designation are tax credits for certain research and a waiver 
of the BLA or NDA application user fee. 

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A  designated  orphan  drug  many  not  receive  orphan  drug  exclusivity  if  it  is  approved  for  a  use  that  is  broader  than  the  indication  for  which  it 
received  orphan  designation.  In  addition,  orphan  drug  exclusive  marketing  rights  in  the  United  States  may  be  lost  if  the  FDA  later  determines  that  the 
request  for  designation  was  materially  defective  or,  as  noted  above,  if  the  second  applicant  demonstrates  that  its  product  is  clinically  superior  to  the 
approved product with orphan exclusivity or the manufacturer of the approved product is unable to assure sufficient quantities of the product to meet the 
needs of patients with the rare disease or condition. 

Biosimilars and Exclusivity 

The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or the Affordable Care Act, 
signed into law in 2010, 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.  To  date,  only  a 
handful of biosimilars have been licensed under the BPCIA, although numerous biosimilars have been approved in Europe. The FDA has issued several 
guidance documents outlining an approach to review and approval of biosimilars. 

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.  Interchangeability  requires  that  a 
product is biosimilar to the reference product and the product must demonstrate that it can be expected to produce the same clinical results as the reference 
product  in  any  given  patient  and,  for  products  that  are  administered  multiple  times  to  an  individual,  the  biologic  and  the  reference  biologic  may  be 
alternated or switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of 
the  reference  biologic.  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 that applicant’s own preclinical data and data from adequate and 
well-controlled  clinical  studies  to  demonstrate  the  safety,  purity  and  potency  of  its  product.  The  BPCIA  also  created  certain  exclusivity  periods  for 
biosimilars approved as interchangeable products. At this juncture, it is unclear whether products deemed “interchangeable” by the FDA will, in fact, be 
readily substituted by pharmacies, which are governed by state pharmacy law. 

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. In addition, recent government proposals have sought to 
reduce the 12-year reference product exclusivity period. Other aspects of the BPCIA, some of which may impact the BPCIA exclusivity provisions, have 
also been the subject of recent litigation. As a result, the ultimate impact, implementation, and impact of the BPCIA is subject to significant uncertainty. 

Hatch-Waxman Amendments and Exclusivity 

Section 505 of the FDCA describes three types of marketing applications that may be submitted to the FDA to request marketing authorization for 
a  new  drug.  A  Section  505(b)(1)  NDA  is  an  application  that  contains  full  reports  of  investigations  of  safety  and  efficacy.  A  505(b)(2)  NDA  is  an 
application that contains full reports of investigations of safety and efficacy but where at least some of the information required for approval comes from 
investigations that were not conducted by or for the applicant and for which the applicant has not obtained a right of reference or use 

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from  the  person  by  or  for  whom  the  investigations  were  conducted.  This  regulatory  pathway  enables  the  applicant  to  rely,  in  part,  on  the  FDA’s  prior 
findings  of  safety  and  efficacy  for  an  existing  product,  or  published  literature,  in  support  of  its  application.  Section  505(j)  establishes  an  abbreviated 
approval process for a generic version of approved drug products through the submission of an Abbreviated New Drug Application, or ANDA. An ANDA 
provides for marketing of a generic drug product that has the same active ingredients, dosage form, strength, route of administration, labeling, performance 
characteristics and intended use, among other things, to a previously approved product. ANDAs are termed “abbreviated” because they are generally not 
required  to  include  preclinical  (animal)  and  clinical  (human)  data  to  establish  safety  and  efficacy.  Instead,  generic  applicants  must  scientifically 
demonstrate that their product is bioequivalent to, or performs in the same manner as, the innovator drug through in vitro, in vivo or other testing. The 
generic version must deliver the same amount of active ingredients into a subject’s bloodstream in the same amount of time as the innovator drug and can 
often be substituted by pharmacists under prescriptions written for the reference listed drug. In seeking approval for a drug through an NDA, applicants are 
required to list with the FDA each patent with claims that cover the applicant’s drug or a method of using the drug. Upon approval of a drug, each of the 
patents listed in the application for the drug is then published in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations, commonly 
known as the Orange Book. Drugs listed in the Orange Book can, in turn, be cited by potential competitors in support of approval of an ANDA or 505(b)
(2) NDA. 

Upon submission of an ANDA or a 505(b)(2) NDA, an applicant must certify to the FDA that (1) no patent information on the drug product that is 
the subject of the application has been submitted to the FDA; (2) such patent has expired; (3) the date on which such patent expires; or (4) such patent is 
invalid or will not be infringed upon by the manufacture, use or sale of the drug product for which the application is submitted. Generally, the ANDA or 
505(b)(2) NDA cannot be approved until all listed patents have expired, except where the ANDA or 505(b)(2) NDA applicant challenges a listed patent 
through the last type of certification, also known as a paragraph IV certification. If the applicant does not challenge the listed patents, or indicates that it is
not seeking approval of a patented method of use, the ANDA or 505(b)(2) NDA application will not be approved until all of the listed patents claiming the 
referenced product have expired. 

If the ANDA or 505(b)(2) NDA applicant has provided a Paragraph IV certification to the FDA, the applicant must send notice of the Paragraph 
IV certification to the NDA and patent holders once the application has been accepted for filing by the FDA. The NDA and patent holders may then initiate 
a patent infringement lawsuit in response to the notice of the paragraph IV certification. If the paragraph IV certification is challenged by an NDA holder or 
the patent owner(s) asserts a patent challenge to the paragraph IV certification, the FDA may not approve that application until the earlier of 30 months 
from the receipt of the notice of the paragraph IV certification, the expiration of the patent, when the infringement case concerning each such patent was 
favorably decided in the applicant’s favor or settled, or such shorter or longer period as may be ordered by a court. This prohibition is generally referred to 
as  the  30-month  stay.  In  instances  where  an  ANDA  or  505(b)(2)  NDA  applicant  files  a  paragraph  IV  certification,  the  NDA  holder  or  patent  owner(s) 
regularly take action to trigger the 30-month stay, recognizing that the related patent litigation may take many months or years to resolve. 

The FDA also cannot approve an ANDA or 505(b)(2) application until all applicable non-patent exclusivities listed in the Orange Book for the 
branded reference drug have expired. For example, a pharmaceutical manufacturer may obtain five years of non-patent exclusivity upon NDA approval of a 
new chemical entity, or NCE, which is a drug containing an active moiety that has not been approved by FDA in any other NDA. An “active moiety” is 
defined  as  the  molecule  responsible  for  the  drug  substance’s  physiological  or  pharmacologic  action.  During  that  five-year  exclusivity  period,  the  FDA 
cannot accept for filing (and therefore cannot approve) any ANDA seeking approval of a generic version of that drug or any 505(b)(2) NDA that relies on 
the FDA’s approval of the drug, provided that that the FDA may accept an ANDA four years into the NCE exclusivity period if the ANDA applicant also 
files a Paragraph IV certification. 

A drug, including one approved under Section 505(b)(2), may obtain a three-year period of exclusivity for a particular condition of approval, or 
change to a marketed product, such as a new formulation for a previously approved product, if one or more new clinical studies (other than bioavailability 
or  bioequivalence  studies)  was  essential  to  the  approval  of  the  application  and  was  conducted/sponsored  by  the  applicant.  Should  this  occur,  the  FDA 
would be precluded from approving any ANDA or 505(b)(2) application for the protected modification until after that three-year exclusivity period has run. 
However, unlike NCE exclusivity, the FDA can accept an application and begin the review process during the exclusivity period.

29

 
Other Healthcare Laws and Compliance Requirements

Pharmaceutical  companies  are  subject  to  additional  healthcare  regulation  and  enforcement  by  the  federal  government  and  by  authorities  in  the 
states and foreign jurisdictions in which they conduct their business. Such laws include, without limitation, state and federal anti-kickback, fraud and abuse, 
false claims, and physician sunshine laws and regulations. If their operations are found to be in violation of any of such laws or any other governmental 
regulations  that  apply,  they  may  be  subject  to  penalties,  including,  without  limitation,  civil  and  criminal  penalties,  damages,  fines,  the  curtailment  or 
restructuring of operations, exclusion from participation in federal and state healthcare programs and individual imprisonment. 

Coverage and Reimbursement

Sales of any product depend, in part, on the extent to which such product will be covered by third-party payors, such as federal, state and foreign 
government healthcare programs, commercial insurance and managed healthcare organizations and the level of reimbursement for such product by third-
party payors. Decisions regarding the extent of coverage and amount of reimbursement to be provided are made on a plan-by-plan basis. These third-party 
payors are increasingly reducing reimbursements for medical products, drugs and services. For products administered under the supervision of a physician, 
obtaining coverage and adequate reimbursement may be particularly difficult because of the higher prices often associated with such drugs. In addition, the 
U.S.  government,  state  legislatures  and  foreign  governments  have  continued  implementing  cost-containment  programs,  including  price  controls, 
restrictions  on  coverage  and  reimbursement  and  requirements  for  substitution  of  generic  products.  Adoption  of  price  controls  and  cost-containment 
measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit sales of any product. Decreases 
in third-party reimbursement for any product or a decision by a third-party payor not to cover a product could reduce physician usage and patient demand 
for the product and also have a material adverse effect on sales. 

Healthcare Reform

In  March  2010,  former  President  Obama  signed  the  Affordable  Care  Act,  which  substantially  changed  the  way  healthcare  is  financed  by  both 
governmental and private insurers in the United States, and significantly affected the pharmaceutical industry. The Affordable Care Act contains a number 
of provisions, including those governing enrollment in federal healthcare programs, reimbursement adjustments and fraud and abuse changes. Additionally, 
the Affordable Care Act increases the minimum level of Medicaid rebates payable by manufacturers of brand name drugs from 15.1% to 23.1%; requires 
collection of rebates for drugs paid by Medicaid managed care organizations; requires manufacturers to participate in a coverage gap discount program, 
under which they must agree to offer 70 percent point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their 
coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D; and imposes a non-deductible annual fee 
on pharmaceutical manufacturers or importers who sell “branded prescription drugs” to specified federal government programs. 

Since its enactment, there have been judicial and Congressional challenges to certain aspects of the Affordable Care Act, and we expect there will 
be  additional  challenges  and  other  efforts  to  repeal  or  replace  the  Affordable  Care  Act  in  the  future.  Other  legislative  changes  have  been  proposed  and 
adopted since the Affordable Care Act was enacted, including aggregate reductions of Medicare payments to providers of 2% per fiscal year and reduced 
payments  to  several  types  of  Medicare  providers.  Moreover,  there  has  recently  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 bills 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  for  drug  products.  Individual  states  in  the  United  States  have  also  become  increasingly  active  in  implementing 
regulations  designed  to  control  pharmaceutical  product  pricing,  including  price  or  patient  reimbursement  constraints,  discounts,  restrictions  on  certain 
product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and 
bulk purchasing. 

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Data Privacy and Security Laws

Numerous state, federal and foreign laws, including consumer protection laws and regulations, govern the collection, dissemination, use, access to, 
confidentiality  and  security  of  personal  information,  including  health-related  information.  In  the  United  States,  numerous  federal  and  state  laws  and 
regulations, including data breach notification laws, health information privacy and security laws and consumer protection laws and regulations that govern 
the collection, use, disclosure, and protection of health-related and other personal information and could apply to our operations or the operations of our 
partners. In addition, certain foreign laws govern the privacy and security of personal data, including health-related data, many of which differ from each 
other in significant ways and may not have the same effect, thus complicating compliance efforts. Failure to comply with these laws, where applicable, can 
result in the imposition of significant civil and/or criminal penalties and private litigation.  Privacy and security laws, regulations, and other obligations are 
constantly evolving, may conflict with each other to complicate compliance efforts, and can result in investigations, proceedings, or actions that lead to 
significant civil and/or criminal penalties and restrictions on data processing.

Employees and Human Capital Resources

As of December 31, 2022, we had 32 employees, all of whom were full-time. Approximately 41% of our employees hold advanced degrees. On 
February 2, 2022, we implemented a corporate restructuring to align our resources to focus on its UBX1325 program while further extending operating 
capital. The restructuring resulted in an elimination of approximately half of our workforce by the middle of 2022. 

The  majority  of  our  employees  work  in  our  corporate  headquarters.  None  of  our  employees  are  represented  by  a  labor  union  or  a  collective 

bargaining agreement and we consider our relationship with our employees to be good.

Our  human  capital  resources  objectives  are,  as  applicable,  identifying,  recruiting,  retaining,  incentivizing  and  integrating  our  existing  and 
additional  employees.  As  such,  we  expend  considerable  time,  attention,  and  financial  resources  on  these  activities.  Our  corporate  culture,  which  is 
underpinned  by  our  company  values,  is  the  overarching  framework  we  use  to  make  decisions  related  to  people  practices,  including  total  compensation, 
short and long-term incentives, health and wellness, and employee engagement.

Facilities

Our corporate headquarters are located in South San Francisco, California, where we currently lease approximately 62,000 square feet of office 
and  laboratory  space  pursuant  to  a  lease  dated  February  28,  2019,  of  which  approximately  23,000  square  feet  was  subleased  as  of  June  2021  through 
August  2024,  and  approximately  15,000  square  feet  was  subleased  as  of  July  2022  through  June  2024.  The  majority  of  our  employees  work  at  our 
corporate headquarters. 

Legal Proceedings

We are not currently involved in any litigation or legal proceedings that, in management’s opinion, are likely to have any material adverse effect 
on our company. While we know of no imminent legal action in which we are likely to be involved, we may in the future become engaged in litigation or 
other legal proceedings. Regardless of the outcome, litigation can have an adverse impact due to defense fees, settlement costs, demands on management 
attention, and other concerns. 

Financial Information About Segments

We  view  our  operations  and  manage  our  business  as  one  reportable  segment.  See  Note  2  in  the  Notes  to  Financial  Statements  included  in  this 

Annual Report on Form 10-K. 

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About UNITY

We  were  incorporated  in  the  State  of  Delaware  on  March  30,  2009.  Our  registered  trademarks  include  UNITY  BIOTECHNOLOGY®.  Other 

service marks, trademarks and trade names referred to in this document are the property of their respective owners.

Available Information

We are subject to the information requirements of the Securities Exchange Act of 1934, as amended and we therefore file periodic reports, proxy 
statements  and  other  information  with  the  U.S.  Securities  and  Exchange  Commission,  or  SEC,  relating  to  our  business,  financial  statements  and  other 
matters. The SEC maintains an Internet site, www.sec.gov, that contains reports, proxy statements and other information regarding issuers such as UNITY.

For more information about UNITY, including free access to our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on 
Form 8-K and amendments to those reports, visit our website, www.unitybiotechnology.com. The information found on or accessible through our website is 
not incorporated into, and does not form a part of, this Annual Report on Form 10-K. 

Item 1A. Risk Factors

This Annual Report on Form 10-K contains forward-looking information based on our current expectations. Because our business is subject to many risks 
and our actual results may differ materially from any forward-looking statements made by or on behalf of us, this section includes a discussion of important 
factors that could affect our business, operating results, financial condition and the trading price of our common stock. Many of the following risks and 
uncertainties have been and may continue to be exacerbated by the lingering effects of the COVID-19 pandemic and any worsening of the global business, 
financial, and economic environment as a result of the COVID-19 pandemic or macroeconomic factors, including high interest rates, rising inflation, and 
liquidity concerns at financial institutions. This discussion should be read in conjunction with the other information in this Annual Report on Form 10-K, 
including  our  financial  statements  and  the  notes  accompanying  those  financial  statements  and  “Management’s  Discussion  and  Analysis  of  Financial 
Condition and Results of Operations.” The occurrence of any of the events or developments described below could have a material adverse effect on our 
business,  results  of  operations,  financial  condition,  prospects  and  stock  price.  Additional  risks  and  uncertainties  not  presently  known  to  us  or  that  we 
currently deem immaterial may also impair our business.

Risk Factor Summary

Below is a summary of the principal factors that make an investment in our common stock speculative or risky. This summary does not address all of the 
risks that we face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the 
heading “Risk Factors” and should be carefully considered, together with other information in this Annual Report on Form 10-K and our other filings with 
the Securities and Exchange Commission, or SEC, before making investment decisions regarding our common stock.

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We are a clinical-stage biopharmaceutical company with a limited operating history and no products approved for commercial sale. We have 
incurred  significant  losses  since  our  inception,  and  we  anticipate  that  we  will  continue  to  incur  losses  for  the  foreseeable  future,  which, 
together with our limited operating history, make it difficult to assess our future viability.

Our  financial  condition  raises  substantial  doubt  as  to  our  ability  to  continue  as  a  going  concern.  We  will  require  substantial  additional 
financing to achieve our goals, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to 
delay, limit, reduce or terminate our product development programs, commercialization efforts or other operations.

We will require substantial additional financing to achieve our goals, and a failure to obtain this capital when needed on acceptable terms, or 
at all, could force us to delay, limit, reduce or terminate our product development, other operations or commercialization efforts.

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We may not be able to maintain compliance with the continued listing requirements of Nasdaq and, if so, we would be subject to delisting.

Our  core  therapeutic  approach  to  slow,  halt,  or  reverse  diseases  of  aging  is  based  on  our  understanding  of  cellular  senescence.  Utilizing 
senolytic molecules to treat diseases of aging is a novel therapeutic approach, which exposes us to unforeseen risks and makes it difficult to 
predict the time and cost of drug development and potential for regulatory approval.

Our business is currently dependent on the successful development and regulatory approval of UBX1325.

Other than UBX1325, all of our other programs are preclinical and face significant development risk.

The  lingering  effects  of  the  COVID-19  pandemic,  any  future  pandemic  and  economic  uncertainty  could  adversely  impact  our  business, 
including our clinical trials, and financial condition.

We rely on third-party suppliers to manufacture preclinical and clinical supplies of our drug candidates and we intend to continue to rely on 
third  parties  to  produce  such  preclinical  and  clinical  supplies  as  well  as  commercial  supplies  of  any  approved  product.  The  loss  of  these 
suppliers, costs and availability of inputs or supplies, supply issues whether or not related to the COVID-19 pandemic, or the failure of those 
manufacturers or suppliers to comply with applicable regulatory requirements or to provide us with sufficient quantities at acceptable quality 
levels or prices, or at all, would materially and adversely affect our business.

We face significant competition in an environment of rapid technological and scientific change, and our drug candidates, if approved, will 
face significant competition and our failure to effectively compete may prevent us from achieving significant market penetration. Most of our 
competitors have significantly greater resources than we do, and we may not be able to successfully compete.

Our  senolytic  medicine  platform  and  any  future  products  that  we  commercialize  could  be  alleged  to  infringe  patent  rights  and  other 
proprietary rights of third parties, which may require costly litigation and, if we are not successful, could cause us to pay substantial damages 
and/or limit our ability to commercialize our products. Even if we obtain regulatory approval for a drug candidate, our products will remain 
subject to regulatory scrutiny.

Risks Related to Our Limited Operating History, Financial Condition, and Capital Requirements

We are a clinical-stage biopharmaceutical company with a limited operating history and no products approved for commercial sale. We have incurred 
significant losses since our inception, and we anticipate that we will continue to incur losses for the foreseeable future, which, together with our limited 
operating history, make it difficult to assess our future viability.

We  are  a  clinical-stage  biopharmaceutical  company  with  a  limited  operating  history.  Biopharmaceutical  product  development  is  a  highly  speculative 
undertaking and involves a substantial degree of risk. We have not yet sought approval for commercial sale of any products and therefore have no products 
approved for commercial sale and have not generated any product revenue and have incurred losses in each year since our inception in March 2009. We 
have only a limited operating history upon which you can evaluate our business and prospects. In addition, we have limited experience and have not yet 
demonstrated an ability to successfully overcome many of the risks and uncertainties frequently encountered by companies in new and rapidly evolving 
fields, particularly in the biopharmaceutical industry. 

We  have  had  significant  operating  losses  since  our  inception.  Our  net  loss  for  the  years  ended  December  31,  2022  and  2021  was  approximately  $59.9 
million and $60.7 million, respectively. As of December 31, 2022, we had an accumulated deficit of $460.0 million. Substantially all of our losses have 
resulted from expenses incurred in connection with our research and development programs and from general and administrative costs associated with our 
operations. We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase as we continue to develop our drug 
candidates, conduct clinical studies and pursue research and development activities. Even if we achieve profitability in the future, we may not be able to 
sustain profitability in subsequent 

33

 
periods.  Our  prior  losses,  combined  with  expected  future  losses,  have  had  and  will  continue  to  have  an  adverse  effect  on  our  stockholders’  equity  and 
working capital.

Our financial condition raises substantial doubt as to our ability to continue as a going concern.

Our financial statements have been prepared assuming that we will continue to operate as a going concern, which contemplates the realization of assets and
the satisfaction of liabilities in the normal course of business. Based on our current operating plans, we expect our existing capital resources will fund our 
planned operating expenses into the first quarter of 2024, which is expected to fund key clinical data readouts for UBX1325, but is less than 12 months 
from the date of this Annual Report. We expect to continue to incur net operating losses for at least the next several years as we continue our research and 
development  efforts,  advance  our  drug  candidates  through  preclinical  and  clinical  development,  seek  regulatory  approval,  prepare  for  and,  if  approved, 
proceed to commercialization. We do not expect to generate revenue from any drug candidates that we develop until we obtain regulatory approval for one 
or more of such drug candidates and commercialize our products or enter into collaborative agreements with third parties. 

These conditions raise substantial doubt about our ability to continue as a going concern. Additionally, our independent registered public accounting firm 
has included in its audit opinion for the year ended December 31, 2022 an explanatory paragraph that there is substantial doubt as to our ability to continue 
as a going concern. There is no assurance that funding will be available to us, will be obtained on terms favorable to us or will provide us with sufficient 
funds to meet our objectives. Failure to raise additional financing may adversely impact our ability to achieve our intended business objectives because 
without substantial additional capital, we may not be able to complete pivotal trials necessary to advance our product development and our programs. The 
reaction of investors to the inclusion of a going concern statement by our auditors and our potential inability to continue as a going concern may materially 
adversely affect our share price and our ability to raise new capital or enter into partnerships. If we become unable to continue as a going concern, we may 
have to liquidate our assets and the values we receive for our assets in liquidation or dissolution could be significantly lower than the values reflected in our 
financial statements.

We will require substantial additional financing to achieve our goals, and a failure to obtain this capital when needed on acceptable terms, or at all, 
could force us to delay, limit, reduce or terminate our product development, other operations or commercialization efforts.

Since our inception, we have invested a significant portion of our efforts and financial resources in research and development activities. Preclinical studies 
and clinical studies for our drug candidates and additional research and development activities to discover and develop new drug candidates will require 
substantial funds to complete. As of December 31, 2022, we had capital resources consisting of cash, cash equivalents, and marketable securities of $94.8 
million. We believe that we will continue to expend substantial resources for the foreseeable future in connection with our programs, including the clinical 
development of UBX1325, and the development of any other drug candidates we may choose to pursue. These expenditures will include costs associated 
with conducting preclinical studies and clinical studies, obtaining regulatory approvals, and manufacturing and supply, as well as marketing and selling any 
products  approved  for  sale.  In  addition,  other  unanticipated  costs  may  arise.  Because  the  outcome  of  any  preclinical  study  or  clinical  study  is  highly 
uncertain,  we  cannot  reasonably  estimate  the  actual  amounts  necessary  to  successfully  complete  the  development  and  commercialization  of  our  current 
drug candidates or any future drug candidates.

In February 2022, we announced a restructuring to align resources to focus on our ongoing clinical programs and deliver on key development milestones. 
These actions to prioritize our ophthalmology programs and implement cost saving measures were designed to enable us to achieve multiple key clinical 
data readouts for UBX1325 as well as support the Tie2 and Tie2/VEGF bispecific program through advanced candidate nomination, with all other pipeline 
programs paused to focus resources on these advanced programs.

Based  on  our  current  operating  plans,  we  expect  our  existing  capital  resources  will  fund  our  planned  operating  expenses  into  the  first  quarter  of  2024, 
which  is  expected  to  fund  key  clinical  data  readouts  for  UBX1325,  but  is  less  than  12  months  from  the  date  of  this  Annual  Report.  Accordingly,  our 
financial statements have been prepared on a going concern basis, which contemplates the continuity of operations, realization of assets and the satisfaction 
of liabilities and commitments in the ordinary course of business. 

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We will need substantial additional capital to operate our business and continue our development activities and without substantial additional capital, we 
may not be able to complete pivotal trials necessary to advance our product development and our programs. If funding is only available on less desirable 
terms or not available at all for companies in the life sciences industry or if we are unable to access our cash deposits held at financial institutions due any 
liquidity concerns at such financial institutions, our business and operations would be adversely affected.

To date, we have primarily financed our operations through the sale of equity securities. For example, in March 2022, we filed a Registration Statement on 
Form S-3 covering the offering of up to $125.0 million of common stock, preferred stock, debt securities, warrants and units, which was declared effective 
by the SEC in May 2022, or the March 2022 Shelf Registration Statement. In March 2022, we also entered into a sales agreement, as amended in August 
2022, or the March 2022 Sales Agreement, with Cowen and Company, LLC, or Cowen, as sales agent to sell shares of our common stock, from time to 
time, with aggregate gross sales proceeds of up to $25.0 million pursuant to the March 2022 Shelf Registration Statement as an “at-the-market” offering 
under the Securities Act, or the March 2022 ATM Offering Program. Further, in October 2022, we filed a Registration Statement on Form S-3 covering the 
offering of up to $250.0 million of common stock, preferred stock, debt securities, warrants and units, or the October 2022 Shelf Registration Statement 
and, together with the March 2022 Shelf Registration Statement, the shelf registration statements. In October 2022, we also entered into a sales agreement 
with Cowen as sales agent to sell shares of our common stock, from time to time, with aggregate gross sales proceeds of up to $50.0 million pursuant to the 
October  2022  Shelf  Registration  Statement  as  an  “at-the-market”  offering  under  the  Securities  Act,  or  the  October  2022  ATM  Offering  Program,  and, 
together with the March 2022 ATM Offering Program, the ATM Offering Programs. 

We will be required to seek additional funding in the future and currently intend to do so through collaborations, public or private equity offerings or debt 
financings, credit or loan facilities or a combination of one or more of these funding sources. Such financing may result in dilution to stockholders and the 
terms of any financing may adversely affect the rights of our stockholders. In addition, as a condition to providing additional funds to us, future investors 
may demand, and may be granted, rights superior to those of existing stockholders. Debt financing, if available, is likely to involve restrictive covenants 
limiting our flexibility in conducting future business activities, and, in the event of insolvency, debt holders would be repaid before holders of our equity 
securities received any distribution of our corporate assets.

Our ability to raise additional funds will depend on financial, economic and other factors, many of which are beyond our control. For example, financial 
markets have been negatively impacted by the COVID-19 pandemic and current macroeconomic trends. The financial markets have further been negatively 
affected by high interest rates, rising inflation, the government closure of Silicon Valley Bank and liquidity concerns at other financial institutions, and the 
potential  for  local  and/or  global  economic  recession.  Such  impacts  may  be  exacerbated  by  unforeseen  events  or  public  health  emergencies.  Adequate 
funding may not be available to us on acceptable terms, or at all, particularly in light of these conditions. In addition, we may seek additional capital due to 
favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. 

We currently have shelf registration statements effective and existing ATM Offering Programs, however, our ability to raise capital under these registration 
statements and through these ATM Offering Programs may be limited by, among other things, SEC rules and regulations impacting the eligibility of smaller 
companies to use Form S-3 for primary offerings of securities. Based on our public float, as of the date of the filing of this Annual Report on Form 10-K, 
we are only permitted to utilize a shelf registration statement, including the registration statements under which our ATM Offering Programs are operated, 
subject to Instruction I.B.6 to Form S-3, which is referred to as the “baby shelf” rule. For so long as our public float is less than $75.0 million, we may not 
sell more than the equivalent of one-third of our public float during any 12 consecutive months pursuant to the baby shelf rules. Although alternative public 
and private transaction structures may be available, these may require additional time and cost, may impose operational restrictions on us, and may not be 
available on attractive terms. 

Our future capital requirements depend on many factors, including:

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the results of our ongoing clinical trials of UBX1325;

our ability to reduce our operating expenses;

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the  scope,  progress,  results  and  costs  of  researching  and  developing  our  drug  candidates,  and  conducting  preclinical  studies  and  clinical 
studies;

potential delays in or an increase in costs associated with our ongoing or planned preclinical studies or clinical trials, including as a result of 
the ongoing effects of the COVID-19 pandemic;

the timing of, and the costs involved in, obtaining regulatory approvals for our current drug candidates or any future drug candidates;

the number and characteristics of any additional drug candidates we develop or acquire;

the timing and amount of any milestone payments we are required to make pursuant to our license agreements;

the cost of manufacturing our current drug candidates or any future drug candidates and any products we successfully commercialize;

the cost of commercialization activities if our current drug candidates or any future drug candidates are approved for sale, including 
marketing, sales and distribution costs;

our ability to maintain existing, and establish new, strategic collaborations, licensing or other arrangements and the financial terms of any 
such agreements, including the timing and amount of any future milestone, royalty or other payments due under any such agreement;

any product liability or other lawsuits related to our products;

the costs associated with being a public company;

the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing our intellectual property portfolio; 

our ability to utilize our ATM Offering Programs and raise additional capital; 

the availability of capital in the technology and life sciences industries following the closure of Silicon Valley Bank and liquidity concerns at 
other financial institutions:

whether we can maintain compliance with the continued listing requirements of Nasdaq; 

the availability of capital in the technology and life sciences industries following the government closure of Silicon Valley Bank and liquidity 
concerns at other financial institutions; and

the timing, receipt and amount of sales of any future approved products, if any.

Additional and sufficient funds may not be available when we need them, on terms that are acceptable to us, or at all. If adequate funds are not available to 
us on a timely basis, we may be required to:

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delay,  limit,  reduce  or  terminate  preclinical  studies,  clinical  studies  or  other  development  activities  for  our  current  drug  candidates  or  any 
future drug candidate;

delay, limit, reduce or terminate our research and development activities; or

delay, limit, reduce or terminate our efforts to establish manufacturing and sales and marketing capabilities or other activities that may be 
necessary to commercialize our current drug candidates or any 

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future drug candidate, or reduce our flexibility in developing or maintaining our sales and marketing strategy.

We also could choose or be required to seek funds through arrangements with collaborators or others that may require us to relinquish rights to some of our 
technologies or drug candidates that we would otherwise pursue on our own. We do not expect to realize revenue from sales of products or royalties from 
licensed  products  in  the  foreseeable  future,  if  at  all,  and  unless  and  until  our  drug  candidates  are  clinically  tested,  approved  for  commercialization  and 
successfully marketed.

We may not be able to maintain compliance with the continued listing requirements of Nasdaq, and, if so, we would be subject to delisting. 

Our common stock is currently listed for trading on the Nasdaq Global Select Market under the symbol “UBX”. The continued listing of our common stock 
on Nasdaq is subject to our compliance with a number of listing standards. On June 3, 2022, we received a letter from the Listing Qualifications Staff of 
The Nasdaq Stock Market LLC indicating that for the last 30 consecutive business days, the closing bid price of our common stock was below $1.00 per 
share, which is the minimum required closing bid price for continued listing on the Nasdaq Global Select Market pursuant to Listing Rule 5450(a)(1). We 
had 180 calendar days, or until November 30, 2022, to regain compliance. To regain compliance, the closing bid price of our common stock needed to be at 
least $1.00 per share for a minimum of ten consecutive business days. On October 19, 2022, we effected a 1-for-10 reverse stock split of our common stock 
seeking  to  regain  compliance  with  Nasdaq  Global  Select  Market's  continued  listing  standards.  From  October  20,  2022  to  November  2,  2022  (10 
consecutive business days), the closing bid price of our common stock exceeded $1.00 per share. Accordingly, on November 3, 2022, we received a notice 
from Nasdaq indicating that we have regained compliance with Listing Rule 5450(a)(1) as of such date. 

Although we currently comply with the minimum bid requirement following the reverse stock split, our bid price could fall below $1.00 per share again in 
the future, in which event we would receive another deficiency notice from Nasdaq advising us that we have 180 days to regain compliance by maintaining 
a  minimum  bid  price  of  at  least  $1.00  for  a  minimum  of  ten  consecutive  business  days.  Under  certain  circumstances,  Nasdaq  could  require  that  the 
minimum  bid  price  exceed  $1.00  for  more  than  ten  consecutive  days  before  determining  that  a  company  complies.  If  we  fail  to  satisfy  the  Nasdaq’s 
continued listing requirements, we may transfer to the OTC Bulletin Board. Having our common stock trade on the OTC Bulletin Board could adversely 
affect the liquidity of our common stock. Any such transfer could make it more difficult to dispose of, or obtain accurate quotations for the price of, our 
common stock, and there also would likely be a reduction in our coverage by securities analysts and the news media, which could cause the price of our 
common  stock  to  decline  further  and  adversely  impact  the  ability  of  stockholders  to  sell  our  common  stock.  We  may  also  face  other  material  adverse 
consequences in such event such as negative publicity, a decreased ability to obtain additional financing, diminished investor and/or employee confidence, 
and the loss of business development opportunities, any of which may contribute to a further decline in our stock price.

Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to 
fall below expectations.

Our quarterly and annual operating results may fluctuate significantly, making it difficult for us to predict our future operating results. These fluctuations
may occur due to a variety of factors, many of which are outside of our control and may be difficult to predict, including:

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the  timing,  cost  and  level  of  investment  in  research,  development  and,  if  approved,  commercialization  activities  relating  to  our  drug 
candidates, which may change from time to time;

the timing and status of enrollment for our clinical studies;

the  cost  of  manufacturing  our  drug  candidates,  as  well  as  building  out  our  supply  chain,  which  may  vary  depending  on  the  quantity  of 
production and the terms of our agreements with manufacturers;

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expenditures we may incur to acquire, develop or commercialize additional drug candidates and technologies;

timing and amount of any milestone, royalty or other payments due under any collaboration or license agreement;

future accounting pronouncements or changes in our accounting policies;

the timing and success or failure of preclinical studies and clinical studies for our drug candidates or competing drug candidates, or any other 
change in the competitive landscape of our industry, including consolidation among our competitors or partners;

the timing of receipt of approvals for our drug candidates from regulatory authorities in the United States and internationally;

coverage  and  reimbursement  policies  with  respect  to  our  drug  candidates,  if  approved,  and  potential  future  drugs  that  compete  with  our
products;

the level of demand for our products, if approved, which may vary significantly over time; and

potential  disruption  caused  by  unforeseen  events  and  public  health  emergencies,  such  as  disruptions  we  experienced  from  the  COVID-19 
pandemic.

The  cumulative  effects  of  these  factors  could  result  in  large  fluctuations  and  unpredictability  in  our  quarterly  and  annual  operating  results.  As  a  result, 
comparing our operating results on a period-to-period basis may not be meaningful. Investors should not rely on our past results as an indication of our 
future performance.

This variability and unpredictability could also result in our failing to meet the expectations of industry or financial analysts or investors for any period. If 
our revenue or operating results fall below the expectations of analysts or investors or below any forecasts we may provide to the market, or if the forecasts 
we provide to the market are below the expectations of analysts or investors, the price of our common stock could decline substantially. Such a stock price 
decline could occur even when we have met any previously publicly stated revenue or earnings guidance we may provide.

Risks Related to Our Business and Product Development

Our  core  therapeutic  approach  to  slow,  halt,  or  reverse  diseases  of  aging  is  based  on  our  understanding  of  cellular  senescence.  Utilizing  senolytic 
molecules to treat diseases of aging is a novel therapeutic approach, which exposes us to unforeseen risks and makes it difficult to predict the time and 
cost of drug development and potential for regulatory approval.

Our foundational science and lead drug candidate are based on senescence biology. We believe that we can develop drug candidates capable of eliminating 
or  modulating  accumulated  senescent  cells,  when  administered  locally.  In  our  development  efforts  we  intend  to  explore  senolytic  medicines  that  use 
multiple modalities. However, our approach to treating diseases of aging is novel and the scientific research that forms the basis of our efforts to develop 
senolytic medicines is ongoing. We have only recently begun testing our senolytic molecules in humans and the majority of our current data supporting our 
hypothesis regarding senescence biology is limited to pre-clinical animal models and in vitro cell lines, the results of which may not translate into humans. 
We currently have no conclusive evidence in humans, that the accumulation or modulation of senescent cells is the underlying cause of tissue damage and 
dysfunction associated with many diseases of aging. For example, in August 2020, we announced the 12-week results from our Phase 2 study of UBX0101 
in patients with moderate-to-severe painful OA of the knee. There was no statistically significant difference between any arm of UBX0101 and placebo at
the 12-week primary endpoint for change from baseline in WOMAC-A, an established measurement of pain in OA. Given these results, we decided not to 
progress UBX0101 into pivotal studies and have narrowed our near-term focus mainly to our ongoing ophthalmologic disease programs.

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Our current program, UBX1325, is a Bcl-xL inhibitor, and is intended to target senescent cells in the eye. While cellular senescence is a naturally occurring 
biological process, the administration of senolytic medicines to eliminate or cause the elimination or modulation of accumulated senescent cells in humans
has not been widely tested and may potentially harm healthy tissue or result in unforeseen safety events, or fail to achieve the intended therapeutic purpose 
entirely. We may also ultimately discover that our senolytic molecules do not possess certain properties required for therapeutic effectiveness, or that even 
if found to be effective in one type of tissue, that such molecules will be effective in other tissues. In addition, given the novel nature of this therapeutic 
approach,  designing  preclinical  and  clinical  studies  to  demonstrate  the  effect  of  senolytic  medicines  is  complex  and  exposes  us  to  unforeseen  risks.  In 
addition, the scientific evidence to support the feasibility of developing systemic senolytic medicines is based primarily on preclinical data and not human 
clinical trials. We may spend substantial funds attempting to develop these drug candidates and never succeed in doing so.

No  regulatory  authority  has  granted  approval  for  a  senolytic  medicine.  As  such,  we  believe  the  U.S.  Food  and  Drug  Administration,  or  the  FDA,  has 
limited experience with senescence, which may increase the complexity, uncertainty and length of the clinical development and regulatory approval process 
for  our  drug  candidates.  We  may  never  receive  approval  to  market  and  commercialize  any  drug  candidate.  Even  if  we  obtain  regulatory  approval,  the 
approval may be for targets, disease indications or patient populations that are not as broad as we intended or desired or may require labeling that includes 
significant use or distribution restrictions or safety warnings. We may be required to perform additional or unanticipated clinical studies to obtain approval 
or be subject to post-marketing testing requirements to maintain marketing authorization. If our other senolytic molecules prove to be ineffective, unsafe or 
commercially unviable, our entire senolytic platform and pipeline would have little, if any, value, which would have a material and adverse effect on our 
business, financial condition, results of operations and prospects.

Our business is currently dependent on the successful development of UBX1325, which is in early stages of clinical development.

We have no products approved for sale and all of our drug candidates are in early stages of development. We have one product candidate, UBX1325, in 
clinical development and are focused on advancing our ophthalmology program. In particular, in October 2020, we initiated a Phase 1 clinical study of 
UBX1325 in patients with DME or nAMD for whom anti-VEGF therapy was no longer considered beneficial, and in July, October, and November 2021, 
we  announced  positive  data  up  to  24  weeks  from  this  Phase  1  study.  We  initiated  a  Phase  2  proof-of-concept  clinical  study  of  UBX1325  in  DME 
(BEHOLD) in May 2021, dosed the first patient in June 2021 and announced positive 24-week safety and efficacy data in November 2022. In April 2022 
we also dosed our first patient in our Phase 2 proof-of-concept study in nAMD (ENVISION), and we expect to share 16- and 24-week data in late March 
2023.  However, the impact of the COVID-19 pandemic on the timing of study initiations, enrollment, visit adherence, and completions is hard to assess 
due the continually evolving nature of the situation and it is possible that the study enrollment, visit adherence, and completion may be delayed. 

In February 2022, we announced a restructuring to align resources to focus on our ongoing clinical programs and deliver on key development milestones. 
These actions to prioritize our ophthalmology programs and implement cost saving measures were designed to enable us to achieve multiple key clinical 
data readouts for UBX1325. As a result, our business is currently dependent on the successful development of UBX1325. The success of our business, 
including our ability to finance our company and generate any revenue in the future, will primarily depend on the successful development of UBX1325. If 
UBX1325  does  not  demonstrate  clinical  benefit,  we  may  be  required  to  significantly  delay  or  abandon  its  development.  In  the  event  UBX1325  is  not 
successful in clinical development, we have limited resources and capital with which to develop additional drug candidates and we may be forced to sell or 
liquidate our business. 

The clinical and commercial success of UBX1325, and any other future drug candidates, will depend on a number of factors, including the following:

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our ability to raise any additional required capital on acceptable terms, or at all;

our ability to complete IND-enabling studies and successfully submit an IND or comparable applications in foreign jurisdictions;

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timely completion of our preclinical studies and clinical studies, which may be significantly slower or cost more than we currently anticipate 
and will depend substantially upon the performance of third-party contractors, some of whom could be adversely impacted by unforeseen 
events such as pandemics and public health emergencies, such as the COVID-19 pandemic;

whether  we  are  required  by  the  FDA  or  similar  foreign  regulatory  agencies  to  conduct  additional  clinical  studies  or  other  studies  beyond 
those planned to support the approval and commercialization of our drug candidates or any future drug candidates;

acceptance of our proposed indications and primary endpoint assessments relating to the proposed indications of our drug candidates by the 
FDA and similar foreign regulatory authorities;

our ability to demonstrate to the satisfaction of the FDA and similar foreign regulatory authorities the safety, efficacy, and acceptable risk-to-
benefit profile of our current drug candidates or any future drug candidates;

the prevalence, duration and severity of potential side effects or other safety issues experienced with our drug candidates or future approved 
products, if any;

the timely receipt of necessary marketing approvals from the FDA and similar foreign regulatory authorities;

achieving  and  maintaining,  and,  where  applicable,  ensuring  that  our  third-party  contractors  achieve  and  maintain  compliance  with  our 
contractual  obligations  and  with  all  regulatory  requirements  applicable  to  our  current  drug  candidates  or  any  future  drug  candidates  or 
approved products, if any;

the willingness of physicians, professional societies, operators of clinics, hospitals, and patients to recommend, utilize, or adopt any of our 
future drug candidates to treat diseases of aging;

the  ability  of  third  parties  with  whom  we  contract  to  manufacture  adequate  clinical  study  and  commercial  supplies  of  our  current  drug 
candidates  or  any  future  drug  candidates,  to  remain  in  good  standing  with  regulatory  agencies  and  develop,  validate  and  maintain 
commercially viable manufacturing processes that are compliant with current good manufacturing practices, or cGMP;

our ability to successfully develop a commercial strategy and thereafter commercialize our drug candidates or any future drug candidates in 
the  United  States,  and  internationally,  if  approved  for  marketing,  reimbursement,  sale  and  distribution  in  such  countries  and  territories, 
whether alone or in collaboration with others;

the convenience of our treatment or dosing regimen;

acceptance by physicians, payors, and patients of the benefits, safety, and efficacy of our drug candidates or any future drug candidates, if 
approved, including relative to alternative and competing treatments;

patient demand for our drug candidates, if approved;

our ability to establish and enforce intellectual property rights in and to our drug candidates or any future drug candidates; and 

our ability to avoid third-party patent interference, intellectual property challenges, or intellectual property infringement claims.

These  factors,  many  of  which  are  beyond  our  control,  could  cause  us  to  experience  significant  delays  or  be  unable  to  obtain  regulatory  approvals  or 
commercialize our drug candidates. In addition, disruptions caused by the COVID-19 

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pandemic in the last few years may increase the likelihood that we encounter such difficulties or delays in developing, obtaining regulatory approvals for or 
commercializing  our  product  candidates.  Even  if  regulatory  approvals  are  obtained,  we  may  never  achieve  success  in  commercializing  any  of  our  drug 
candidates. Accordingly, we cannot provide assurances that we will be able to generate sufficient revenue through the sale of our drug candidates or any 
future drug candidates to continue our business or achieve profitability.

Other than UBX1325, all of our other programs are preclinical and face significant development risk.   

Other than UBX1325, all of our other programs are in preclinical and early research stage. In addition, we have limited resources for which to develop any 
products other than UBX1325. Given the early stage nature of these programs, each of the drug candidates and programs faces substantial development 
risk. UBX1325 is the only current drug candidate that we have administered to humans, and as such, we face significant translational risk with our earlier 
stage drug candidates. We may also be required by the FDA or similar foreign regulatory agencies to conduct additional preclinical studies beyond those 
planned to support the commencement of additional clinical trials. Accordingly, there can be no assurance that we are able to bring any of our preclinical 
product candidates or development programs into the clinic or otherwise successfully develop them.

Clinical development involves a lengthy and expensive process with an uncertain outcome, and results of earlier studies and trials may not be predictive 
of future trial results.

Clinical testing is expensive and can take many years to complete, and its outcome is inherently uncertain. Failure or delay can occur at any time during the 
clinical study process. Success in preclinical studies and early clinical studies does not ensure that later clinical studies will be successful. A number of 
companies in the biotechnology, and pharmaceutical industries have suffered significant setbacks in clinical studies, even after positive results in earlier 
preclinical  studies  or  clinical  studies.  These  setbacks  have  been  caused  by,  among  other  things,  preclinical  findings  made  while  clinical  studies  were 
underway and safety or efficacy observations made in clinical studies, including previously unreported adverse events. The results of our preclinical animal 
studies or studies in ex vivo human tissues may not be predictive of the results of outcomes in human clinical studies. For example, our senolytic molecules 
may demonstrate different chemical and pharmacological properties in patients than they do in laboratory studies or may interact with human biological 
systems in unforeseen or harmful ways.

Drug  candidates  in  later  stages  of  clinical  studies  may  fail  to  show  the  desired  pharmacological  properties  or  safety  and  efficacy  traits  despite  having 
progressed through preclinical studies and initial clinical studies. Notwithstanding any promising results in earlier studies, we cannot be certain that we will 
not face similar setbacks. Even if we are able to initiate and complete clinical studies, the results may not be sufficient to obtain regulatory approval for our 
drug candidates.

We cannot be certain that studies or trials for our drug candidates will begin on time, not require redesign, enroll an adequate number of subjects on time or 
be completed on schedule, if at all. The COVID-19 pandemic could cause or exacerbate these factors. For example, for our Phase 2 studies for UBX1325 
and  future  studies,  clinical  sites  may  be  unable  to  recruit  and  retain  investigators  and  study  staff,  screen  and  enroll  patients,  patients  may  be  unable  to 
adhere to the study visit schedule, and the completion of the study could be delayed. Clinical studies can be prolonged, delayed or terminated for a variety 
of reasons, including:

•

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•

•

the FDA or comparable foreign regulatory authorities disagreeing with or requiring changes to the design or implementation of our clinical 
studies;

delays in obtaining regulatory approval to commence or continue a trial;

reaching  agreement  on  acceptable  terms  with  prospective  contract  research  organizations,  or  CROs,  and  clinical  study  sites,  the  terms  of 
which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites;

obtaining institutional review board, or IRB, approval at each trial site;

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recruiting an adequate number of suitable patients to participate in a trial;

having subjects complete a trial or return for post-treatment follow-up;

encountering difficulties in gathering the range of biological data from patients needed to fully assess the impact of our drug candidates;

clinical sites deviating from trial protocol or dropping out of a trial;

addressing subject safety concerns that arise during the course of a trial;

adding a sufficient number of clinical study sites; or

obtaining  sufficient  product  supply  of  drug  candidate  for  use  in  preclinical  studies  or  clinical  studies  from  third-party  suppliers  some  of 
whom  could  be  adversely  impacted  by  unforeseen  events  such  as  pandemics  and  public  health  emergencies,  such  as  the  COVID-19 
pandemic.

We may experience numerous adverse or unforeseen events during, or as a result of, preclinical studies and clinical studies that could delay or prevent our 
ability to receive marketing approval or commercialize our drug candidates, including:

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•

clinical studies of our drug candidates may produce negative or inconclusive results, and we may decide, or regulators may require us, to 
modify  clinical  study  design,  conduct  additional  clinical  studies  or  abandon  drug  development  programs,  including  all  of  our  senolytic 
programs;

the  number  of  patients  required  for  clinical  studies  of  our  drug  candidates  may  be  larger  than  we  anticipate,  enrollment  in  these  clinical 
studies may be slower than we anticipate, or participants may drop out of these clinical studies at a higher rate than we anticipate;

our  third-party  contractors  may  fail  to  comply  with  regulatory  requirements,  fail  to  maintain  adequate  quality  controls,  or  be  unable  to 
provide us with sufficient product supply to conduct and complete preclinical studies or clinical studies of our drug candidates in a timely 
manner, or at all;

we  or  our  investigators  might  have  to  suspend  or  terminate  clinical  studies  of  our  drug  candidates  for  various  reasons,  including 
noncompliance  with  regulatory  requirements,  a  finding  that  our  drug  candidates  have  undesirable  side  effects  or  other  unexpected 
characteristics, a finding that the participants are being exposed to unacceptable health risks, or due to unforeseen events such as pandemics 
and public health emergencies, such as the COVID-19 pandemic;

the cost of clinical studies of our drug candidates may be greater than we anticipate;

the quality of our drug candidates or other materials necessary to conduct preclinical studies or clinical studies of our drug candidates may be 
inadequate;

regulators may revise the requirements for approving our drug candidates, or such requirements may not be as we anticipate; and

future collaborators may conduct clinical studies in ways they view as advantageous to them but that are suboptimal for us.

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If we are required to conduct additional clinical studies or other testing of our drug candidates beyond those that we currently contemplate, if we are unable
to successfully complete clinical studies of our drug candidates or other testing, if the results of these trials or tests are not positive or are only moderately 
positive, or if there are safety concerns, we may:

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incur unplanned costs;

be delayed in obtaining marketing approval for our drug candidates or fail to obtain marketing approval at all;

obtain marketing approval in some countries and not in others;

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

obtain  marketing  approval  with  labeling  that  includes  significant  use  or  distribution  restrictions  or  safety  warnings,  including  boxed 
warnings;

be subject to additional post-marketing testing requirements; or

have the treatment removed from the market after obtaining marketing approval.

We could also encounter delays if a clinical study is suspended or terminated by us, by the IRBs of the institutions in which such trials are being conducted, 
by the Data Safety Monitoring Board, or DSMB, for such trial or by the FDA or other regulatory authorities. Such authorities may suspend or terminate a 
clinical  study  due  to  a  number  of  factors,  including  failure  to  conduct  the  clinical  study  in  accordance  with  regulatory  requirements  or  our  clinical 
protocols, inspection of the clinical study operations or trial site by the FDA or other regulatory authorities resulting in the imposition of a clinical hold, 
unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations or administrative 
actions or lack of adequate funding to continue the clinical study.

Further,  conducting  clinical  studies  in  foreign  countries,  as  we  may  do  for  certain  of  our  drug  candidates,  presents  additional  risks  that  may  delay 
completion  of  our  clinical  studies.  These  risks  include  the  failure  of  enrolled  patients  in  foreign  countries  to  adhere  to  clinical  protocol  as  a  result  of 
differences in healthcare services or cultural customs, managing additional administrative burdens associated with foreign regulatory schemes, as well as 
political  and  economic  risks  relevant  to  such  foreign  countries,  including  those  caused  by  unforeseen  events  such  as  pandemics  and  public  health 
emergencies similar to the COVID-19 pandemic.

Principal  investigators  for  our  clinical  studies  may  serve  as  scientific  advisors  or  consultants  to  us  from  time  to  time  and  may  receive  cash  or  equity 
compensation in connection with such services. If these relationships and any related compensation result in perceived or actual conflicts of interest, or a 
regulatory  authority  concludes  that  the  financial  relationship  may  have  affected  the  interpretation  of  the  trial,  the  integrity  of  the  data  generated  at  the 
applicable clinical study site may be questioned and the utility of the clinical study itself may be jeopardized, which could result in the delay or rejection of 
the marketing application we submit. Any such delay or rejection could prevent or delay us from commercializing our current or future drug candidates.

If we experience termination or delays in the completion of any preclinical study or clinical study of our drug candidates, the commercial prospects of our 
drug candidates may be harmed, and our ability to generate revenues from any of these drug candidates will be delayed or unrealized. In addition, any 
delays  in  completing  our  clinical  studies  may  increase  our  costs,  slow  down  our  drug  candidate  development  and  approval  process  and  jeopardize  our 
ability to commence product sales and generate revenues. Any of these occurrences may significantly harm our business, financial condition and prospects. 
In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical studies may also ultimately lead to the denial 
of regulatory approval of our drug candidates. If one or more of our drug candidates or our senescence technology generally prove to be ineffective, 

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unsafe or commercially unviable, our platform and pipeline would have significantly diminished value, which would have a material and adverse effect on 
our business, financial condition, results of operations and prospects.

The COVID-19 pandemic could adversely impact our business, including our clinical trials, and financial condition.

The COVID-19 pandemic and government measures taken in response have had a significant impact, both direct and indirect, on businesses and commerce,
as worker shortages have occurred, supply chains have been disrupted, facilities and production have been suspended, and demand for certain goods and 
services, such as medical services and supplies, has spiked, while demand for other goods and services, such as travel, has fallen. In response to the spread 
of COVID-19, we have adjusted our remote and in-person working model based on applicable safety guidelines and the best interest of our employees, and 
may be required to take additional or different actions that could impact our operations if required by applicable laws or regulations or if we determine 
them to be in the best interest of our employees.

For the Phase 1 safety and tolerability clinical study and the Phase 2 proof-of-concept clinical studies for UBX1325, we adapted the clinical study protocol 
and standard operating procedures to enable a number of adaptations such as: remote data collection for clinical sites if needed; the option for remote data 
source verification procedures to limit on-site monitoring; transportation options for patients to utilize for study visit adherence; flexible visit windows to 
increase study visit adherence; and geographic distribution of sites to mitigate variation in local restrictions. 

These actions enable the collection of all major endpoints if patients adhere with the study visit schedule. Assessments that require an on-site visit may be 
missed for some or all patients including laboratory evaluations, clinical examinations, or imaging.

CROs based in the United States that provide preclinical services are experiencing heavy demand, which may impact their ability to start new studies and 
could  lead  to  delays  in  the  commencement  of  our  preclinical  studies.  Several  of  our  U.S.-based  academic  research  partners  have  also  experienced 
shutdowns which has slowed progress on several early-stage projects, none of which impacted our preclinical timelines.

As the ongoing effects of the COVID-19 pandemic continue, we may experience disruptions that could severely impact our business and clinical trials, 
including:

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delays or difficulties in enrolling patients in our clinical trials;

delays or difficulties in clinical site initiation, including difficulties in recruiting clinical site investigators and clinical site staff;

diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as our clinical trial sites 
and hospital staff supporting the conduct of our clinical trials;

interruption  of  key  clinical  trial  activities,  such  as  clinical  trial  site  monitoring,  due  to  limitations  on  travel  imposed  or  recommended  by 
federal  or  state  governments,  employers  and  others  or  interruption  of  clinical  trial  subject  visits  and  study  procedures,  the  occurrence  of 
which could affect the integrity of clinical trial data;

risk that participants enrolled in our clinical trials will contract the COVID-19 coronavirus while the clinical trial is ongoing, which could 
impact the results of the clinical trial, including by increasing the number of observed adverse events;

limitations  in  employee  resources  that  would  otherwise  be  focused  on  the  conduct  of  our  clinical  trials,  including  because  of  sickness  of 
employees or their families or the desire of employees to avoid contact with large groups of people;

delays in receiving authorizations from local regulatory authorities to initiate our planned clinical trials;

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delays in clinical sites receiving the supplies and materials needed to conduct our clinical trials;

interruption in global shipping that may affect the transport of clinical trial materials, such as investigational drug product used in our clinical 
trials;

changes in local regulations as part of a response to the COVID-19 pandemic which may require us to change the ways in which our clinical 
trials are conducted, which may result in unexpected costs, or to discontinue such clinical trials altogether;

interruptions,  delays,  or  increased  costs  in  preclinical  studies  due  to  restricted  or  limited  operations  or  supplies  at  our  research  and 
development laboratory facilities;

delays in necessary interactions with local regulators, ethics committees and other important agencies and contractors due to limitations in 
employee resources or forced furlough of government employees; and

refusal of the FDA to accept data from clinical trials in affected geographies outside the United States.

The global pandemic of the COVID-19 coronavirus continues to evolve. The extent to which the COVID-19 pandemic may impact our business, including 
our clinical trials, and financial condition will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as 
the ultimate geographic spread of the disease, the duration of the pandemic, the adoption and efficacy of vaccines, travel restrictions and social distancing 
in  the  United  States  and  other  countries,  business  closures  or  business  disruptions  and  the  effectiveness  of  actions  taken  in  the  United  States  and  other 
countries to contain and treat the disease.

If  we  encounter  difficulties  enrolling  patients  in  our  clinical  studies,  our  clinical  development  activities  could  be  delayed  or  otherwise  adversely 
affected.

The timely completion of clinical studies in accordance with their protocols depends, among other things, on our ability to enroll a sufficient number of 
patients who remain in the study until its conclusion. We may experience difficulties in patient enrollment in our clinical studies for a variety of reasons. 
The enrollment of patients depends on many factors, including:

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the patient eligibility criteria defined in the protocol;

the size of the patient population required for analysis of the trial’s primary endpoints;

the proximity of patients to trial sites;

patients’ fear of visiting or traveling to trial sites due to pandemics and public health emergencies, such as the COVID-19 pandemic;

the design of the trial;

our ability to recruit clinical study investigators with the appropriate competencies and experience;

clinicians’ and patients’ perceptions as to the potential advantages of the drug candidate being studied in relation to other available therapies, 
including any new drugs that may be approved for the indications we are investigating; and

our ability to obtain and maintain patient consents.

In addition, our clinical studies may compete with other clinical studies for drug candidates that are in the same therapeutic areas as our drug candidates. 
This  competition  will  reduce  the  number  and  types  of  patients  available  to  us,  because  some  patients  who  might  have  opted  to  enroll  in  our  trials  may 
instead opt to enroll in a trial being 

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conducted by one of our competitors. Since the number of qualified clinical investigators is limited, we may conduct some of our clinical studies at the 
same  clinical  study  sites  that  some  of  our  competitors  use,  which  will  reduce  the  number  of  patients  who  are  available  for  our  clinical  studies  in  such 
clinical study site.

Further, the administration of senolytic medicines designed to eliminate or cause the elimination of senescent cells and thereby modulate their associated 
SASP may result in unforeseen events, including by harming healthy tissues. As a result, it is possible that safety concerns could negatively affect patient 
enrollment  among  the  patient  populations  that  we  intend  to  treat,  including  among  those  in  indications  with  a  low  risk  of  mortality.  Delays  in  patient 
enrollment may result in increased costs or may affect the timing or outcome of the planned clinical studies, which could prevent completion of these trials 
and adversely affect our ability to advance the development of our drug candidates.

Interim,  “top-line”  and  preliminary  data  from  our  clinical  trials  that  we  announce  or  publish  from  time  to  time  may  change  as  more  patient  data 
become available and are subject to audit and verification procedures that could result in material changes in the final data.

From time to time, we may publicly disclose top-line or preliminary data from our clinical trials, which is based on a preliminary analysis of then-available 
data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular 
study or trial. We also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had 
the opportunity to fully and carefully evaluate all data. As a result, the top-line or preliminary results that we report may differ from future results of the 
same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Top-line or 
preliminary data also remain subject to audit and verification procedures that may result in the final data being materially different from the top-line or 
preliminary data we previously published. As a result, top-line and preliminary data should be viewed with caution until the final data are available.

From time to time, we may also disclose interim data from our preclinical studies and clinical trials. Interim data from clinical trials that we may conduct 
are  subject  to  the  risk  that  one  or  more  of  the  clinical  outcomes  may  materially  change  as  patient  enrollment  continues  and  more  patient  data  become 
available. Adverse differences between interim data and final data could significantly harm our business prospects. Further, disclosure of interim data by us
or by our competitors could result in volatility in the price of our common stock.

Further,  others,  including  regulatory  agencies,  may  not  accept  or  agree  with  our  assumptions,  estimates,  calculations,  conclusions  or  analyses  or  may 
interpret or weigh the importance of data differently, which could impact the value of the particular program, the approvability or commercialization of the 
particular product candidate or product, our ability to make certain claims about our products, and our company in general. In addition, the information we 
choose to publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree 
with what we determine is material or otherwise appropriate information to include in our disclosure.

If  the  interim,  top-line  or  preliminary  data  that  we  report  differ  from  actual  results,  or  if  others,  including  regulatory  authorities,  disagree  with  the 
conclusions  reached,  our  ability  to  obtain  approval  for,  and  commercialize,  our  product  candidates  may  be  harmed,  which  could  harm  our  business, 
operating results, prospects or financial condition.

Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain, 
or deploy key leadership and other personnel, or otherwise prevent products from being developed, approved, or commercialized in a timely manner or 
at all, which may adversely affect our business. 

The ability of the FDA and other government agencies to review and approve new products can be affected by a variety of factors, including government 
budget and funding levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes. In 
addition,  government  funding  of  other  government  agencies  that  fund  research  and  development  activities  is  subject  to  the  political  process,  which  is 
inherently  fluid  and  unpredictable.  Disruptions  at  the  FDA  and  other  agencies,  including  a  prolonged  government  shutdown,  may  cause  significant 
regulatory delays and, therefore, delay our efforts to seek approvals and adversely affect our business, financial condition, results of operations, or cash 
flows. For example, over the last several years, 

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the  U.S.  government  has  shut  down  several  times,  and  certain  regulatory  agencies,  such  as  the  FDA,  have  had  to  furlough  critical  employees  and  stop 
critical activities.

Separately, in response to the global COVID-19 pandemic, the FDA postponed most inspections of domestic and foreign manufacturing facilities at various 
points. Even though the FDA has since resumed standard inspection operations where feasible, the FDA has continued to monitor and implement changes 
to its inspectional activities to ensure the safety of its employees and those of the firms it regulates as it adapts to the evolving COVID-19 pandemic, and 
any resurgence of the virus or emergence of new variants may lead to further inspectional delays. Regulatory authorities outside the United States may 
adopt similar restrictions or other policy measures in response to the COVID-19 pandemic. If a prolonged government shutdown occurs, or if global health 
concerns continue to prevent the FDA and other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it 
could significantly impact the ability of the FDA and other regulatory authorities to timely review and process our regulatory submissions, which could 
have a material adverse effect on our business.

Our  drug  candidates  may  cause  undesirable  side  effects  or  have  other  properties  that  could  delay  or  prevent  their  regulatory  approval,  limit  the 
commercial profile of an approved label, or result in significant negative consequences following marketing approval, if any.

Undesirable side effects caused by our drug candidates could cause us or regulatory authorities to interrupt, delay or halt clinical studies and could result in 
a  more  restrictive  label  or  the  delay  or  denial  of  regulatory  approval  by  the  FDA  or  comparable  foreign  regulatory  authorities.  Other  than  our  clinical 
studies  of  UBX0101  and  UBX1325,  senolytic  medicines  designed  to  eliminate  or  cause  the  elimination  of  senescent  cells  have  never  been  tested  in 
humans.  As  a  result,  although  UBX1325  has  been  well  tolerated  in  our  Phase  1  and  Phase  2  clinical  studies  with  no  adversities  that  would  prevent 
advancement into later stage clinical trials as of March 15, 2023, UBX1325 could reveal a high and unacceptable severity and prevalence of side effects, 
and it is possible that patients enrolled in such clinical studies could respond in unexpected ways. For instance, in preclinical in vivo animal and ex vivo 
human tissue studies, our senolytic molecules have exhibited clearance of senescent cells; however, the elimination of accumulated senescent cells may 
result in unforeseen events, including harming healthy cells or tissues. In addition, the entry by cells into a senescent state is a natural biological process 
that we believe may have protective effects, such as halting the proliferation of damaged cells. The treatment of tissues with senolytic molecules could 
interfere with such protective processes.

If unacceptable side effects arise in the development of our drug candidates, we, the FDA, the IRBs at the institutions in which our studies are conducted, 
or  the  DSMB  could  suspend  or  terminate  our  clinical  studies,  or  the  FDA  or  comparable  foreign  regulatory  authorities  could  order  us  to  cease  clinical 
studies or deny approval of our drug candidates for any or all targeted indications. Treatment-related side effects could also affect patient recruitment or the 
ability of enrolled patients to complete any of our clinical studies or result in potential product liability claims. In addition, these side effects may not be 
appropriately recognized or managed by the treating medical staff. We expect to have to train medical personnel using our drug candidates to understand 
the  side  effect  profiles  for  our  clinical  studies  and  upon  any  commercialization  of  any  of  our  drug  candidates.  Inadequate  training  in  recognizing  or 
managing the potential side effects of our drug candidates could result in patient injury or death. Any of these occurrences may harm our business, financial 
condition and prospects significantly.

In  addition,  even  if  we  successfully  advance  any  of  our  drug  candidates  into  and  through  clinical  studies,  such  trials  will  likely  only  include  a  limited 
number of subjects and limited duration of exposure to our drug candidates. As a result, we cannot be assured that adverse effects of our drug candidates 
will not be uncovered when a significantly larger number of patients are exposed to the drug candidate. Further, clinical studies may not be sufficient to 
determine the effect and safety consequences of taking our drug candidates over a multi-year period. There can be no assurance that it will demonstrate a 
similarly favorable safety profile in subsequent clinical trials.

If any of our drug candidates receives marketing approval, and we or others later identify undesirable side effects caused by such products, a number of 
potentially significant negative consequences could result, including:

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regulatory authorities may withdraw their approval of the product;

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we may be required to recall a product or change the way such product is administered to patients;

additional  restrictions  may  be  imposed  on  the  marketing  of  the  particular  product  or  the  manufacturing  processes  for  the  product  or  any 
component thereof;

regulatory authorities may require the addition of labeling statements, such as a “black box” warning or a contraindication;

we may be required to implement a Risk Evaluation and Mitigation Strategy, or REMS, or create a Medication Guide outlining the risks of 
such side effects for distribution to patients;

we could be sued and held liable for harm caused to patients;

the product may become less competitive; and

our reputation may suffer.

Any of the foregoing events could prevent us from achieving or maintaining market acceptance of the particular drug candidate, if approved, and result in 
the loss of significant revenues to us, which would materially and adversely affect our results of operations and business. In addition, if one or more of our 
drug candidates or our senescence approach generally prove to be unsafe, our entire platform and pipeline could be affected, which would have a material 
and adverse effect on our business, financial condition, results of operations and prospects.

We may not be successful in our efforts to continue to create a pipeline of drug candidates or to develop commercially successful products. If we fail to 
successfully identify and develop additional drug candidates, our commercial opportunity may be limited.

We  are  committed  to  developing  senolytic  medicines  that  slow,  halt,  or  reverse  diseases  of  aging,  and  we  are  currently  advancing  multiple  senolytic 
molecules to address a variety of diseases of aging, including ophthalmologic disorders. As senolytic medicines are not limited to intervention by a single 
mode  of  action  or  molecular  target,  we  believe  that  we  can  modulate  a  number  of  biologic  pathways  in  order  to  trigger  the  beneficial  elimination  of 
senescent cells. However, our core therapeutic approach is based on our belief that senescent cells drive diseases of aging, and that hypothesis has not yet 
been proven. In addition, we do not know if we will be able to develop medicines that selectively eliminate senescent cells or whether the elimination of 
such senescent cells will mitigate the effects of or effectively treat any diseases.

In addition, identifying, developing, obtaining regulatory approval and commercializing drug candidates for the treatment of diseases of aging will require 
substantial additional funding and is prone to the risks of failure inherent in drug development. Research programs to identify drug candidates also require 
substantial technical, financial and human resources, regardless of whether or not any drug candidates are ultimately identified, and even if our preclinical 
research programs initially show promise in identifying potential drug candidates, they may fail to yield drug candidates for clinical development.

While we have a number of ongoing drug discovery programs targeting senescent cells, we do not know whether these will be successful, or whether we
will  be  able  to  identify  novel  senolytic  mechanisms  to  continue  to  build  our  pipeline.  We  also  cannot  provide  any  assurance  that  we  will  be  able  to 
successfully identify or acquire additional drug candidates, advance any of these additional drug candidates through the development process, successfully 
commercialize  any  such  additional  drug  candidates,  if  approved,  or  assemble  sufficient  resources  to  identify,  acquire,  develop  or,  if  approved, 
commercialize additional drug candidates. If we are unable to successfully identify, acquire, develop and commercialize additional drug candidates, our 
commercial opportunities may be limited.

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We may be unable to obtain regulatory approval for our drug candidates under applicable regulatory requirements. The denial or delay of any such 
approval would delay commercialization of our drug candidates and adversely impact our potential to generate revenue, our business and our results of 
operations.

To gain approval to market our drug candidates, we must provide the FDA and foreign regulatory authorities with clinical data that adequately demonstrate 
the safety and efficacy of the drug candidate for the intended indication applied for in the applicable regulatory filing. For our senolytic medicines, we must 
also  demonstrate  that  eliminating  or  causing  the  elimination  of  senescent  cells  and  modulating  relevant  associated  SASP  factors  will  lead  to  the 
improvement of well-defined and measurable endpoints.

We have not previously submitted a new drug application, or NDA, or biologics license application, or BLA, to the FDA, or similar approval filings to 
comparable  foreign  regulatory  authorities.  An  NDA,  BLA  or  other  relevant  regulatory  filing  must  include  extensive  preclinical  and  clinical  data  and 
supporting information to establish that the drug candidate is safe and effective, or that a biological drug candidate is safe, pure and potent for each desired 
indication. The NDA, BLA or other relevant regulatory submission must also include significant information regarding the chemistry, manufacturing and 
controls for the product.

The research, testing, manufacturing, labeling, approval, sale, marketing, and distribution of drug and biologic products are subject to extensive regulation 
by  the  FDA  and  other  regulatory  authorities  in  the  United  States  and  other  countries,  and  such  regulations  differ  from  country  to  country.  We  are  not 
permitted  to  market  our  drug  candidates  in  the  United  States  or  in  any  foreign  countries  until  they  receive  the  requisite  approval  from  the  applicable 
regulatory authorities of such jurisdictions.

The FDA or any foreign regulatory bodies can delay, limit or deny approval of our drug candidates for many reasons, including:

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our inability to demonstrate to the satisfaction of the FDA or the applicable foreign regulatory body that any of our drug candidates is safe 
and effective for the requested indication;

the  FDA’s  or  the  applicable  foreign  regulatory  agency’s  disagreement  with  our  trial  protocol  or  the  interpretation  of  data  from  preclinical 
studies or clinical studies;

our inability to demonstrate that the clinical and other benefits of any of our drug candidates outweigh any safety or other perceived risks;

the FDA’s or the applicable foreign regulatory agency’s requirement for additional preclinical studies or clinical studies;

the FDA’s or the applicable foreign regulatory agency’s failure to approve the formulation, labeling or specifications of our current or future 
drug candidates, including UBX1325;

the  FDA’s  or  the  applicable  foreign  regulatory  agency’s  failure  to  approve  the  manufacturing  processes  or  facilities  of  third-party 
manufacturers upon which we rely; or

the potential for approval policies or regulations of the FDA or the applicable foreign regulatory agencies to significantly change in a manner 
that renders our clinical data insufficient for approval.

Of the large number of biopharmaceutical and pharmaceutical products in development, only a small percentage successfully complete the FDA or other 
regulatory approval processes and are commercialized.

Even if we eventually complete clinical testing and receive approval from the FDA or applicable foreign agencies for any of our drug candidates, the FDA 
or the applicable foreign regulatory agency may grant approval contingent on the performance of costly additional clinical studies which may be required 
after  approval.  The  FDA  or  the  applicable  foreign  regulatory  agency  also  may  approve  our  current  drug  candidates  for  limited  indications  or  narrower 
patient populations than we originally requested, and the FDA, or applicable foreign regulatory agency, may not approve our 

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drug candidates with the labeling that we believe is necessary or desirable for the successful commercialization of such drug candidates.

Any delay in obtaining, or inability to obtain, applicable regulatory approval would delay or prevent commercialization of our drug candidates and would 
materially adversely impact our business and prospects.

Even if our current drug candidates or any future drug candidates obtain regulatory approval, they may fail to achieve the broad degree of physician 
and patient adoption and use necessary for commercial success.

Even  if  one  or  more  of  our  drug  candidates  receive  FDA  or  other  regulatory  approvals,  the  commercial  success  of  any  of  our  current  or  future  drug 
candidates will depend significantly on the broad adoption and use of the resulting product by physicians and patients for approved indications. Our drug 
candidates may not be commercially successful for a variety of reasons, including: competitive factors, pricing or physician preference, reimbursement by 
insurers, and the degree and rate of physician and patient adoption of our current or future drug candidates. If approved, the commercial success of our drug 
candidates will depend on a number of factors, including:

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the clinical indications for which the product is approved and patient demand for approved products that treat those indications;

the safety and efficacy of our product as compared to other available therapies;

the availability of coverage and adequate reimbursement from managed care plans, insurers and other healthcare payors for any of our drug 
candidates that may be approved;

acceptance by physicians, operators of clinics, and patients of the product as a safe and effective treatment;

physician and patient willingness to adopt a new therapy over other available therapies to treat approved indications;

overcoming any biases physicians or patients may have toward particular therapies for the treatment of approved indications;

proper training and administration of our drug candidates by physicians and medical staff;

public misperception regarding the use of our therapies, or public bias against “anti-aging” companies;

patient satisfaction with the results and administration of our drug candidates and overall treatment experience, including, for example, the 
convenience of any dosing regimen;

the cost of treatment with our drug candidates in relation to alternative treatments and reimbursement levels, if any, and willingness to pay for 
the product, if approved, on the part of insurance companies and other third-party payers, physicians and patients;

the willingness of patients to pay for certain of our products, if approved;

the revenue and profitability that our products may offer a physician as compared to alternative therapies;

the prevalence and severity of side effects;

limitations or warnings contained in the FDA-approved labeling for our products;

the willingness of physicians, operators of clinics and patients to utilize or adopt our products as a solution;

any FDA requirement to undertake a REMS;

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the effectiveness of our sales, marketing and distribution efforts;

adverse publicity about our products or favorable publicity about competitive products; and

potential product liability claims.

We cannot assure you that our current or future drug candidates, if approved, will achieve broad market acceptance among physicians and patients. Any 
failure by our drug candidates that obtain regulatory approval to achieve market acceptance or commercial success would adversely affect our results of 
operations.

We rely on third-party suppliers to manufacture supplies of our drug candidates and we intend to continue to rely on third parties to produce such 
preclinical and clinical supplies as well as commercial supplies of any approved product. The loss of these suppliers, or their failure to comply with 
applicable  regulatory  requirements  or  to  provide  us  with  sufficient  quantities  at  acceptable  quality  levels  or  prices,  or  at  all,  would  materially  and 
adversely affect our business.

We do not have the infrastructure or capability internally to manufacture supplies of our drug candidates or the materials necessary to produce our drug 
candidates for use in the conduct of our clinical studies, and we lack the internal resources and the capability to manufacture any of our drug candidates on 
a  clinical  or  commercial  scale.  The  facilities  used  by  our  contract  manufacturers  to  manufacture  our  drug  candidates  are  subject  to  various  regulatory 
requirements and may be subject to the inspection of the FDA or other regulatory authorities. We do not control the manufacturing process of, and are 
completely  dependent  on,  our  contract  manufacturing  partners  for  compliance  with  the  regulatory  requirements,  known  as  cGMPs.  If  our  contract 
manufacturers  cannot  successfully  manufacture  material  that  conforms  to  our  specifications  and  the  strict  regulatory  requirements  of  the  FDA  or 
comparable  regulatory  authorities  in  foreign  jurisdictions,  we  may  not  be  able  to  rely  on  their  manufacturing  facilities  for  the  manufacture  or  our  drug 
candidates. In addition, we have limited control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and 
qualified personnel. If the FDA or a comparable foreign regulatory authority finds these facilities inadequate for the manufacture of our drug candidates or 
if such facilities are subject to enforcement action in the future or are otherwise inadequate, we may need to find alternative manufacturing facilities, which 
would significantly impact our ability to develop, obtain regulatory approval for or market our drug candidates.

We currently intend to supply all of our drug candidates in all territories for our planned clinical development programs. We currently rely on third parties 
at key stages in our supply chain. For instance, the supply chains for our current drug candidates involve several manufacturers that specialize in specific 
operations of the manufacturing process, specifically, raw materials manufacturing, drug substance manufacturing and drug product manufacturing. As a 
result, the supply chain for the manufacturing of our drug candidates is complicated and we expect the logistical challenges associated with our supply 
chain to grow more complex as our drug candidates progress through the clinical trial process. Some of these third parties have in the past and may in the 
future  also  be  adversely  impacted  by  unforeseen  events  and  public  health  emergencies.  For  example,  one  of  the  manufacturers  in  our  supply  chain  for 
UBX0101  experienced  a  two-week  shutdown  in  April  2020  due  to  a  COVID-19  related  incident.  While  this  incident  did  not  impact  our  supply  of 
UBX0101 for clinical studies being conducted in April 2020, there can be no assurance that our supply chain for any of our candidates and clinical trials 
will not be disrupted in the future due to such incidents.

We  do  not  have  any  control  over  the  process  or  timing  of  the  acquisition  or  manufacture  of  materials  by  our  manufacturers.  Further,  we  have  not  yet 
engaged  any  manufacturers  for  the  commercial  supply  of  our  current  drug  candidates.  Although  we  intend  to  enter  into  such  agreements  prior  to 
commercial launch of any of our drug candidates, we may be unable to enter into any such agreement or do so on commercially reasonable terms, which 
could have a material adverse impact upon our business. We generally do not begin a preclinical study and we do not intend to initiate any clinical studies 
unless we believe we have access to a sufficient supply of a drug candidate to complete such study or trial. In addition, any significant delay in, or quality 
control problems with respect to, the supply of a drug candidate, or the raw material components thereof, for an ongoing study or trial could considerably 
delay completion of our preclinical studies or future clinical studies, product testing and potential regulatory approval of our drug candidates.

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Moreover,  if  there  is  a  disruption  to  one  or  more  of  our  third-party  manufacturers’  or  suppliers’  relevant  operations,  or  if  we  are  unable  to  enter  into 
arrangements for the commercial supply of our drug candidates, we will have no other means of producing our current drug candidates until they restore 
the affected facilities or we or they procure alternative manufacturing facilities or sources of supply. Our ability to progress our preclinical and clinical 
programs  could  be  materially  and  adversely  impacted  if  any  of  the  third-party  suppliers  upon  which  we  rely  were  to  experience  a  significant  business 
challenge, disruption or failure due to issues such as financial difficulties or bankruptcy, issues relating to other customers such as regulatory or quality 
compliance issues, or other financial, legal, regulatory or reputational issues.

Additionally, any damage to or destruction of our third-party manufacturers’ or suppliers’ facilities or equipment may significantly impair our ability to 
manufacture our drug candidates on a timely basis.

Further, to manufacture our current drug candidates in the quantities that we believe would be required to meet anticipated market demand, our third-party 
manufacturers would likely need to increase manufacturing capacity and, in some cases, we would need to secure alternative sources of commercial supply, 
which  could  involve  significant  challenges  and  may  require  additional  regulatory  approvals.  In  addition,  the  development  of  commercial-scale 
manufacturing  capabilities  may  require  us  and  our  third-party  manufacturers  to  invest  substantial  additional  funds  and  hire  and  retain  the  technical 
personnel  who  have  the  necessary  manufacturing  experience.  Neither  we  nor  our  third-party  manufacturers  may  successfully  complete  any  required 
increase to existing manufacturing capacity in a timely manner, or at all. If our manufacturers or we are unable to purchase the raw materials necessary for 
the manufacture of our drug candidates on acceptable terms, at sufficient quality levels, or in adequate quantities, if at all, the commercial launch of our 
current drug candidates or any future drug candidates would be delayed or there would be a shortage in supply, which would impair our ability to generate 
revenues from the sale of such drug candidates, if approved.

If we fail to attract and retain key personnel, we may be unable to successfully develop our current drug candidates or any future drug candidates, 
conduct our clinical studies and commercialize our current or any future drug candidates.

Our success depends in part on our continued ability to attract, retain and motivate highly qualified management and employees. In February 2022, we 
announced  a  restructuring  to  advance  corporate  strategy  and  focus  on  key  ophthalmology  programs.  As  a  result  of  the  restructuring  and  other  factors, 
additional unplanned loss of personnel may occur despite our efforts to retain management and employees. Additionally, continued disruption caused by 
the transition or by the loss of ongoing services of any other members of our management or employees could delay or prevent the successful development 
of our ongoing programs, initiation or completion of our planned clinical studies or the commercialization of our current drug candidates or any future drug 
candidates. Competition for qualified personnel in the biotechnology and pharmaceuticals field is intense due to the limited number of individuals who 
possess the skills and experience required by our industry, and we may not be able to adequately address attrition, including unplanned, attrition, and as a 
result, the timely completion of our clinical trials could be jeopardized. Further, our ability to attract and retain highly qualified management and employees 
relies in part on our ability to offer competitive compensation and equity packages to such key personnel. We use restricted stock units, or RSUs, and stock 
options  as  a  key  component  of  compensation  for  key  employees  in  order  to  align  employee  interests  with  the  interests  of  our  stockholder,  provide 
competitive compensation packages, and encourage employee retention. Our stock price volatility or lack of positive performance may cause periods of 
time during which option exercise prices might be less than the sale price of our common stock or the value of RSUs might be less competitive, which may 
lessen the retentive attributes of these awards. We are also limited as to the number of equity awards that we may grant under our stock plans, and we are 
unsure  how  effective  different  stock-based  awards  with  different  vesting  schedules  will  be  to  retain  key  employees.  As  a  result,  we  may  have  to  incur 
increased compensation costs, change our equity compensation strategy, or find it difficult to attract, retain and motivate employees.

We  depend  on  third-party  suppliers  for  key  raw  materials  used  in  our  manufacturing  processes,  and  the  loss  of  these  third-party  suppliers  or  their 
inability to supply us with adequate raw materials could harm our business.

We rely on third-party suppliers for the raw materials required for the production of our drug candidates. Our dependence on these third-party suppliers and 
the challenges we may face in obtaining adequate supplies of raw materials involve several risks, including limited control over pricing, availability, and 
quality and delivery schedules. 

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As a small company, our negotiation leverage is limited, and we are likely to get lower priority than our competitors who are larger than we are. We cannot 
be certain that our suppliers will continue to provide us with the quantities of these raw materials that we require or satisfy our anticipated specifications 
and  quality  requirements.  Any  supply  interruption  in  limited  or  sole  sourced  raw  materials  could  materially  harm  our  ability  to  manufacture  our  drug 
candidates until a new source of supply, if any, could be identified and qualified. We may be unable to find a sufficient alternative supply channel in a 
reasonable  time  or  on  commercially  reasonable  terms.  Any  performance  failure  on  the  part  of  our  suppliers  could  delay  the  development  and  potential 
commercialization of our drug candidates, including limiting supplies necessary for clinical studies and regulatory approvals, which would have a material 
adverse effect on our business.

We rely on third parties in the conduct of critical portions of our preclinical studies and intend to rely on third parties in the conduct of critical portions of 
our future clinical studies. If these third parties do not successfully carry out their contractual duties, fail to comply with applicable regulatory requirements 
or meet expected deadlines, we may be unable to obtain regulatory approval for our drug candidates. Some of these third parties may also be adversely 
impacted by unforeseen events and public health emergencies.

We currently do not have the ability to independently conduct preclinical studies that comply with the regulatory requirements known as good laboratory 
practice, or GLP, requirements. We also do not currently have the ability to independently conduct any clinical studies. The FDA and regulatory authorities 
in  other  jurisdictions  require  us  to  comply  with  regulations  and  standards,  commonly  referred  to  as  good  clinical  practice,  or  GCP,  requirements  for 
conducting, monitoring, recording and reporting the results of clinical studies, in order to ensure that the data and results are scientifically credible and 
accurate and that the trial subjects are adequately informed of the potential risks of participating in clinical studies. We rely on medical institutions, clinical 
investigators, contract laboratories and other third parties, such as CROs, to conduct GLP-compliant preclinical studies and GCP-compliant clinical studies 
on our drug candidates properly and on time. While we have agreements governing their activities, we control only certain aspects of their activities and 
have limited influence over their actual performance. The third parties with whom we contract for execution of our GLP-compliant preclinical studies and 
our GCP-compliant clinical studies play a significant role in the conduct of these studies and trials and the subsequent collection and analysis of data. These 
third  parties  are  not  our  employees  and,  except  for  restrictions  imposed  by  our  contracts  with  such  third  parties,  we  have  limited  ability  to  control  the 
amount or timing of resources that they devote to our programs. Although we rely on these third parties to conduct our GLP-compliant preclinical studies 
and  GCP-compliant  clinical  studies,  we  remain  responsible  for  ensuring  that  each  of  our  GLP  preclinical  studies  and  clinical  studies  is  conducted  in 
accordance  with  its  investigational  plan  and  protocol  and  applicable  laws  and  regulations,  and  our  reliance  on  the  CROs  does  not  relieve  us  of  our 
regulatory responsibilities.

Many of the third parties with whom we contract may also have relationships with other commercial entities, potentially including our competitors, for 
whom  they  may  also  be  conducting  clinical  studies  or  other  drug  development  activities  that  could  harm  our  competitive  position.  If  the  third  parties 
conducting our preclinical studies or our clinical studies do not adequately perform their contractual duties or obligations, experience significant business 
challenges, disruptions or failures, do not meet expected deadlines, terminate their agreements with us or need to be replaced, or if the quality or accuracy 
of the data they obtain is compromised due to their failure to adhere to our protocols or to GCPs, or for any other reason, we may need to enter into new 
arrangements  with  alternative  third  parties.  This  could  be  difficult,  costly  or  impossible,  and  our  preclinical  studies  or  clinical  studies  may  need  to  be 
extended, delayed, terminated or repeated. As a result, we may not be able to obtain regulatory approval in a timely fashion, or at all, for the applicable 
drug candidate, our financial results and the commercial prospects for our drug candidates would be harmed, our costs could increase, and our ability to 
generate revenues could be delayed.

We  face  significant  competition  in  an  environment  of  rapid  technological  and  scientific  change,  and  our  drug  candidates,  if  approved,  will  face 
significant competition and our failure to effectively compete may prevent us from achieving significant market penetration. Most of our competitors 
have significantly greater resources than we do, and we may not be able to successfully compete.

The  biotechnology  and  pharmaceutical  industries  in  particular  are  characterized  by  rapidly  advancing  technologies,  intense  competition  and  a  strong 
emphasis  on  developing  proprietary  therapeutics.  Numerous  companies  are  engaged  in  the  development,  patenting,  manufacturing  and  marketing  of 
healthcare  products  competitive  with  those  that  we  are  developing.  We  face  competition  from  a  number  of  sources,  such  as  pharmaceutical  companies, 
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companies, biotechnology companies and academic and research institutions, many of which have greater financial resources, marketing capabilities, sales 
forces, manufacturing capabilities, research and development capabilities, clinical study expertise, intellectual property portfolios, experience in obtaining 
patents and regulatory approvals for drug candidates and other resources than we do. Some of the companies that offer competing products also have a 
broad range of other product offerings, large direct sales forces and long-term customer relationships with our target physicians, which could inhibit our 
market penetration efforts. Mergers and acquisitions in the pharmaceutical industry may result in even more resources being concentrated among a smaller 
number of our competitors. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements 
with large and established companies. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel 
and establishing clinical study sites and patient registration for clinical studies, as well as in acquiring technologies complementary to, or necessary for, our 
programs. In addition, certain of our drug candidates, if approved, may compete with other products that treat diseases of aging, including over the counter, 
or OTC, treatments, for a share of some patients’ discretionary budgets and for physicians’ attention within their clinical practices.

We are aware of other companies seeking to develop treatments to prevent or treat diseases of aging through various biological pathways. Within our lead 
senolytic  program  in  ophthalmology  diseases,  our  drug  candidates  would  compete  against  current  therapies  from  a  wide  range  of  companies  and 
technologies,  including  current  standard  of  care  treatments  such  as  anti-VEGF  antibodies  (bevacizumab,  ranibizumab,  aflibercept,  brolucizumab), 
bispecific  antibodies  (faricimab),  intravitreal  steroid  (dexamethasone),  high-dose  Eylea,  and  pan-retinal  photocoagulation  by  laser.  There  are  also 
potentially  disease-modifying  therapeutics  being  developed  by  several  pharmaceutical  and  biotechnology  companies,  including  Roche/Genentech  and 
Regeneron.

Further, we believe that potential competitors may be able to develop senolytic medicines utilizing well-established molecules and pathways, which could 
enable the development of competitive drug candidates utilizing the same cellular senescence biological theories.

Certain alternative treatments offered by competitors may be available at lower prices and may offer greater efficacy or better safety profiles. Furthermore, 
currently  approved  products  could  be  discovered  to  have  application  for  treatment  of  diseases  of  aging  generally,  which  could  give  such  products 
significant  regulatory  and  market  timing  advantages  over  any  of  our  drug  candidates.  Our  competitors  also  may  obtain  FDA,  EMA  or  other  regulatory 
approval for their products more rapidly than we may obtain approval for ours and may obtain orphan product exclusivity from the FDA for indications our 
drug candidates are targeting, which could result in our competitors establishing a strong market position before we are able to enter the market. Newly 
developed systemic or non-systemic treatments that replace existing therapies that currently are only utilized in patients suffering from severe disease may 
also  have  lessened  side  effects  or  reduced  prices  compared  to  current  therapies,  which  make  them  more  attractive  for  patients  suffering  from  mild  to 
moderate disease. Even if a generic or OTC product is less effective than our drug candidates, it may be more quickly adopted by physicians and patients 
than our competing drug candidates based upon cost or convenience.

The  successful  commercialization  of  our  drug  candidates  will  depend  in  part  on  the  extent  to  which  governmental  authorities  and  health  insurers 
establish adequate coverage, reimbursement levels and pricing policies. Failure to obtain or maintain coverage and adequate reimbursement for our 
drug candidates, if approved, could limit our ability to market those products and decrease our ability to generate revenue.

The  availability  and  adequacy  of  coverage  and  reimbursement  by  governmental  healthcare  programs  such  as  Medicare  and  Medicaid,  private  health 
insurers and other third-party payors are essential for most patients to be able to afford prescription medications such as our drug candidates, assuming 
FDA approval. Our ability to achieve acceptable levels of coverage and reimbursement for products by governmental authorities, private health insurers 
and other organizations will have an effect on our ability to successfully commercialize our drug candidates. Assuming we obtain coverage for our drug 
candidates  by  a  third-party  payor,  the  resulting  reimbursement  payment  rates  may  not  be  adequate  or  may  require  co-payments  that  patients  find 
unacceptably high. We cannot be sure that coverage and reimbursement in the United States, the European Union or elsewhere will be available for our 
drug candidates or any product that we may develop, and any reimbursement that may become available may be decreased or eliminated in the future.

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Third-party  payors  increasingly  are  challenging  prices  charged  for  pharmaceutical  products  and  services,  and  many  third-party  payors  may  refuse  to 
provide coverage and reimbursement for particular drugs or biologics when an equivalent generic drug, biosimilar or a less expensive therapy is available. 
It  is  possible  that  a  third-party  payor  may  consider  our  drug  candidates  as  substitutable  and  only  offer  to  reimburse  patients  for  the  cost  of  the  less 
expensive product. Even if we show improved efficacy or improved convenience of administration with our drug candidates, pricing of existing third-party 
therapeutics may limit the amount we will be able to charge for our drug candidates. These payors may deny or revoke the reimbursement status of a given 
product or establish prices for new or existing marketed products at levels that are too low to enable us to realize an appropriate return on our investment in 
our drug candidates. If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize our drug 
candidates and may not be able to obtain a satisfactory financial return on our investment in the development of drug candidates.

There is significant uncertainty related to the insurance coverage and reimbursement of newly approved products. In the United States, third-party payors, 
including private and governmental payors, such as the Medicare and Medicaid programs, play an important role in determining the extent to which new 
drugs and biologics will be covered. The Medicare and Medicaid programs increasingly are used as models in the United States for how private payors and 
other governmental payors develop their coverage and reimbursement policies for drugs and biologics. Some third-party payors may require pre-approval 
of coverage for new or innovative devices or drug therapies before they will reimburse healthcare providers who use such therapies. We cannot predict at 
this time what third-party payors will decide with respect to the coverage and reimbursement for our drug candidates.

No  uniform  policy  for  coverage  and  reimbursement  for  products  exists  among  third-party  payors  in  the  United  States.  Therefore,  coverage  and 
reimbursement for products can differ significantly from payor to payor. As a result, the coverage determination process is often a time-consuming and 
costly process that will require us to provide scientific and clinical support for the use of our drug candidates to each payor separately, with no assurance 
that  coverage  and  adequate  reimbursement  will  be  applied  consistently  or  obtained  in  the  first  instance.  Furthermore,  rules  and  regulations  regarding 
reimbursement change frequently, in some cases on short notice, and we believe that changes in these rules and regulations are likely.

Outside  the  United  States,  international  operations  are  generally  subject  to  extensive  governmental  price  controls  and  other  market  regulations,  and  we 
believe the increasing emphasis on cost-containment initiatives in Europe and other countries have and will continue to put pressure on the pricing and 
usage of our drug candidates. In many countries, the prices of medical products are subject to varying price control mechanisms as part of national health 
systems. Other countries allow companies to fix their own prices for medical products but monitor and control company profits.

Additional  foreign  price  controls  or  other  changes  in  pricing  regulation  could  restrict  the  amount  that  we  are  able  to  charge  for  our  drug  candidates. 
Accordingly, in markets outside the United States, the reimbursement for our drug candidates may be reduced compared with the United States and may be 
insufficient to generate commercially reasonable revenue and profits.

Moreover,  increasing  efforts  by  governmental  and  third-party  payors  in  the  United  States  and  abroad  to  cap  or  reduce  healthcare  costs  may  cause  such 
organizations to limit both coverage and the level of reimbursement for newly approved products and, as a result, they may not cover or provide adequate 
payment for our drug candidates. We expect to experience pricing pressures in connection with the sale of our drug candidates due to the trend toward 
managed  health  care,  the  increasing  influence  of  health  maintenance  organizations  and  additional  legislative  changes.  The  downward  pressure  on 
healthcare  costs  in  general,  particularly  prescription  drugs  and  biologics  and  surgical  procedures  and  other  treatments,  has  become  intense.  As  a  result, 
increasingly high barriers are being erected to the entry of new products.

We currently have no sales organization. If we are unable to establish sales capabilities on our own or through third parties, we may not be able to 
market and sell our drug candidates effectively in the U.S. and foreign jurisdictions, if approved, or generate product revenue.

We currently do not have a marketing or sales organization. In order to commercialize our drug candidates in the United States and foreign jurisdictions, we 
must  build  our  marketing,  sales,  distribution,  managerial  and  other  non-technical  capabilities  or  make  arrangements  with  third  parties  to  perform  these 
services, and we may not be successful 

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in doing so. If any of our drug candidates receive regulatory approval, we expect to establish a sales organization with technical expertise and supporting 
distribution  capabilities  to  commercialize  each  such  drug  candidate,  which  will  be  expensive  and  time  consuming.  We  have  no  prior  experience  in  the 
marketing,  sale  and  distribution  of  pharmaceutical  products  and  there  are  significant  risks  involved  in  building  and  managing  a  sales  organization, 
including our ability to hire, retain, and incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing 
personnel,  and  effectively  manage  a  geographically  dispersed  sales  and  marketing  team.  Any  failure  or  delay  in  the  development  of  our  internal  sales, 
marketing and distribution capabilities would adversely impact the commercialization of these products. We may choose to collaborate with third parties 
that have direct sales forces and established distribution systems, either to augment our own sales force and distribution systems or in lieu of our own sales 
force  and  distribution  systems.  If  we  are  unable  to  enter  into  such  arrangements  on  acceptable  terms  or  at  all,  we  may  not  be  able  to  successfully 
commercialize our drug candidates. If we are not successful in commercializing our drug candidates or any future drug candidates, either on our own or 
through arrangements with one or more third parties, we may not be able to generate any future product revenue and we would incur significant additional 
losses.

If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our current 
or future drug candidates.

We face an inherent risk of product liability as a result of the clinical testing of our drug candidates and will face an even greater risk if we commercialize 
any products. For example, we may be sued if any product we develop allegedly causes injury or is found to be otherwise unsuitable during product testing, 
manufacturing, marketing or sale. Any such product liability claims may include allegations of defects in manufacturing, defects in design, and a failure to 
warn of dangers inherent in the product, negligence, strict liability, and a breach of warranty. Claims could also be asserted under state consumer protection 
acts.  If  we  cannot  successfully  defend  ourselves  against  product  liability  claims,  we  may  incur  substantial  liabilities  or  be  required  to  limit 
commercialization of our drug candidates.

Even a successful defense would require significant financial and management resources. Regardless of the merits or eventual outcome, liability claims 
may result in:

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decreased demand for our current or future drug candidates;

injury to our reputation;

withdrawal of clinical study participants;

costs to defend the related litigation;

a diversion of management’s time and our resources;

substantial monetary awards to trial participants or patients;

regulatory investigations, product recalls, withdrawals or labeling, marketing or promotional restrictions;

loss of revenue; and

the inability to commercialize our current or any future drug candidates.

Our inability to obtain and maintain sufficient product liability insurance at an acceptable cost and scope of coverage to protect against potential product 
liability claims could prevent or inhibit the commercialization of our current or any future drug candidates we develop. We currently carry product liability 
insurance covering our clinical studies. Although we maintain such insurance, any claim that may be brought against us could result in a court judgment or 
settlement in an amount that is not covered, in whole or in part, by our insurance or that is in excess of the limits of our insurance coverage. Our insurance 
policies also have various exclusions and deductibles, and we may be subject to a product liability claim for which we have no coverage. We will have to 
pay any amounts awarded by a court or negotiated in a settlement that exceed our coverage limitations or that are not covered by our insurance, and we 
may not have, or be able to obtain, sufficient funds to pay such amounts. Moreover, in the future, we may not be able to 

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maintain insurance coverage at a reasonable cost or in sufficient amounts to protect us against losses. If and when we obtain approval for marketing any of 
our drug candidates, we intend to expand our insurance coverage to include the sale of such drug candidate; however, we may be unable to obtain this 
liability insurance on commercially reasonable terms or at all.

Our existing collaborations as well as additional collaboration arrangements that we may enter into in the future may not be successful, which could 
adversely affect our ability to develop and commercialize our drug candidates.

We utilize external collaborations and currently maintain several active early-stage research and discovery focused collaborations. In the future, we may 
seek additional collaboration arrangements for the commercialization, or potentially for the development, of certain of our drug candidates depending on 
the merits of retaining commercialization rights for ourselves as compared to entering into collaboration arrangements. To the extent that we decide to enter 
into additional collaboration agreements in the future, we may face significant competition in seeking appropriate collaborators. Moreover, collaboration 
arrangements are complex and time-consuming to negotiate, document, implement and maintain and challenging to manage. We may not be successful in 
our  efforts  to  prudently  manage  our  existing  collaborations  or  to  enter  new  ones  should  we  chose  to  do  so.  The  terms  of  new  collaborations,  or  other 
arrangements that we may establish may not be favorable to us.

The success of our collaboration arrangements will depend heavily on the efforts and activities of our collaborators and partners. Collaborations are subject 
to numerous risks, which may include risks that:

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collaborators and partners have significant discretion in determining the efforts and resources that they will apply to collaborations and they 
may not devote the level of effort or resources we expect;

collaborators may not pursue development and commercialization of our drug candidates or may elect not to continue or renew development 
or  commercialization  programs  based  on  clinical  study  results,  changes  in  their  strategic  focus  due  to  their  acquisition  of  competitive 
products  or  their  internal  development  of  competitive  products,  availability  of  funding  or  other  external  factors,  such  as  a  business 
combination that diverts resources or creates competing priorities;

collaborators  may  delay  clinical  studies,  provide  insufficient  funding  for  a  clinical  study  program,  stop  a  clinical  study,  abandon  a  drug 
candidate, repeat or conduct new clinical studies or require a new formulation of a drug candidate for clinical testing;

collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our products or 
drug candidates;

a  collaborator  with  marketing,  manufacturing,  and  distribution  rights  to  one  or  more  products  may  not  commit  sufficient  resources  to  or 
otherwise not perform satisfactorily in carrying out these activities;

we could grant exclusive rights to our collaborators that would prevent us from collaborating with others;

collaborators  may  not  properly  maintain  or  defend  our  intellectual  property  rights  or  may  use  our  intellectual  property  or  proprietary 
information  in  a  way  that  gives  rise  to  actual  or  threatened  litigation  that  could  jeopardize  or  invalidate  our  intellectual  property  or 
proprietary information or expose us to potential liability;

disputes may arise between us and a collaborator that cause the delay or termination of the research, development or commercialization of 
our current or future drug candidates or that result in costly litigation or arbitration that diverts management attention and resources;

collaborations  may  be  terminated,  resulting  in  a  need  for  additional  capital  to  pursue  further  development  or  commercialization  of  the 
applicable current or future drug candidates;

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collaborators may own or co-own intellectual property covering products that results from our collaborating with them, and in such cases, we 
would not have the exclusive right to develop or commercialize such intellectual property;

disputes may arise with respect to the ownership of any intellectual property developed pursuant to our collaborations;

a collaborator’s sales and marketing activities or other operations may not be in compliance with applicable laws resulting in civil or criminal 
proceedings; and

collaborators may be adversely impacted by unforeseen events and public health emergencies.

Risks Related to Intellectual Property

Our senolytic medicine platform and any future products that we commercialize could be alleged to infringe patent rights and other proprietary rights 
of third parties, which may require costly litigation and, if we are not successful, could cause us to pay substantial damages and/or limit our ability to 
commercialize our products.

Our  commercial  success  depends  on  our  ability  to  develop,  manufacture  and  market  our  senolytic  medicines  and  future  drug  candidates  and  use  our 
proprietary technology without infringing the patents and other proprietary rights of third parties. Intellectual property disputes can be costly to defend and 
may cause our business, operating results and financial condition to suffer. We operate in an industry with extensive intellectual property litigation. As the 
biopharmaceutical and pharmaceutical industries expand and more patents are issued, the risk increases that there may be patents issued to third parties that 
relate to our products and technology of which we are not aware or that we may need to challenge to continue our operations as currently contemplated.

Whether merited or not, we may face allegations that we have infringed the trademarks, copyrights, patents and other intellectual property rights of third 
parties, including patents held by our competitors or by non-practicing entities. We may also face allegations that our employees have misappropriated the 
intellectual property rights of their former employers or other third parties.

Litigation may make it necessary to defend ourselves by determining the scope, enforceability, and validity of third-party proprietary rights, or to establish 
our proprietary rights. Regardless of whether claims that we are infringing patents or other intellectual property rights have merit, the claims can be time 
consuming, divert management attention and financial resources and are costly to evaluate and defend. Results of any such litigation are difficult to predict 
and may require us to stop treating certain conditions, obtain licenses or modify our products and features while we develop non-infringing substitutes, or 
may  result  in  significant  settlement  costs.  For  example,  litigation  can  involve  substantial  damages  for  infringement  (and  if  the  court  finds  that  the 
infringement was willful, we could be ordered to pay treble damages and the patent owner’s attorneys’ fees), and the court could prohibit us from selling or 
licensing our products unless the third-party licenses rights to us, which it is not required to do at a commercially reasonable price or at all. If a license is 
available from a third party, we may have to pay substantial royalties, upfront fees or grant cross-licenses to intellectual property rights for our products. 
We may also have to redesign our products so they do not infringe third-party intellectual property rights, which may not be possible at all or may require 
substantial monetary expenditures and time, during which our products may not be available for manufacture, use, or sale.

In  addition,  patent  applications  in  the  United  States  and  many  international  jurisdictions  are  typically  not  published  until  18  months  after  the  filing  of 
certain  priority  documents  (or,  in  some  cases,  are  not  published  until  they  issue  as  patents)  and  publications  in  the  scientific  literature  often  lag  behind 
actual discoveries. Thus, we cannot be certain that others have not filed patent applications or made public disclosures relating to our technology or our 
contemplated technology. A third party may have filed, and may in the future file, patent applications covering our products or technology similar to ours. 
Any  such  patent  application  may  have  priority  over  our  patent  applications  or  patents,  which  could  further  require  us  to  obtain  rights  to  issued  patents
covering such technologies. If another party has filed a U.S. patent application on inventions similar to ours, depending on whether the timing of the filing 
date falls under certain patent laws, we may have to participate in a priority contest (such as an interference proceeding) declared by the U.S. Patent and 
Trademark Office, to determine priority of invention in the United States. The costs of patent and 

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other proceedings could be substantial, and it is possible that such efforts would be unsuccessful if it is determined that the other party had independently 
arrived at the same or similar invention prior to our own invention, resulting in a loss of our U.S. patent position with respect to such inventions.

From time to time, we may be subject to legal proceedings and claims in the ordinary course of business with respect to intellectual property. Although we 
are not currently subject to any claims from third parties asserting infringement of their intellectual property rights, in the future, we may receive claims 
from third parties asserting infringement of their intellectual property rights. Future litigation may be necessary to establish our intellectual property rights 
or  to  defend  ourselves  by  determining  the  scope,  enforceability  and  validity  of  third-party  intellectual  property  rights.  There  can  be  no  assurance  with 
respect to the outcome of any current or future litigation brought by or against us, and the outcome of any such litigation could have a material adverse 
impact on our business, operating results and financial condition. Litigation is inherently unpredictable and outcomes are uncertain. Further, as the costs 
and outcome of these types of claims and proceedings can vary significantly, it is difficult to estimate potential losses that may occur. Accordingly, we are 
unable at this time to estimate the effects of these potential future lawsuits on our financial condition, operations or cash flows.

Some of our competitors may be able to sustain the costs of complex patent litigation more effectively than we can because they have substantially greater 
resources.  Even  if  resolved  in  our  favor,  litigation  or  other  legal  proceedings  relating  to  intellectual  property  claims  may  cause  us  to  incur  significant 
expenses and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements 
of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, 
it could have a material adverse effect on the price of our common stock. Finally, any uncertainties resulting from the initiation and continuation of any 
litigation could have a material adverse effect on our ability to raise the funds necessary to continue our operations.

If  we  are  unable  to  obtain,  maintain  and  enforce  intellectual  property  protection  directed  to  our  senolytic  medicine  platform  and  any  future 
technologies that we develop, others may be able to make, use, or sell products substantially the same as ours, which could adversely affect our ability 
to compete in the market.

As of March 1, 2023, we own, co-own, or have an exclusive license in certain fields of use to more than 150  patents and pending applications in the United 
States and foreign jurisdictions. This portfolio includes 37 issued and allowed U.S. patents and applications and 46 granted and allowed foreign patents and 
applications, respectively. A composition of matter patent filing claiming the specific chemical structure of UBX1325 was issued in the U.S. on April 20, 
2021, which will extend our loss of exclusivity on this molecule to 2039, not including any patent term adjustment or patent term extensions to which it 
may be entitled. 

We have not pursued or maintained, and may not pursue or maintain in the future, patent protection for our products in every country or territory in which 
we may sell our products. In addition, we cannot be sure that any of our pending patent applications or pending trademark applications will issue or that, if 
issued,  they  will  issue  in  a  form  that  will  be  advantageous  to  us.  The  U.S.  Patent  and  Trademark  Office,  or  the  USPTO,  international  patent  offices  or 
judicial bodies may deny or significantly narrow claims made under our patent applications and our issued patents may be successfully challenged, may be 
designed around, or may otherwise be of insufficient scope to provide us with protection for our commercial products. Further, the USPTO, international 
trademark offices or judicial bodies may deny our trademark applications and, even if published or registered, these trademarks may not effectively protect 
our brand and goodwill. Like patents, trademarks also may be successfully opposed or challenged.

We cannot be certain that the steps we have taken will prevent unauthorized use or unauthorized reverse engineering of our technology. Moreover, third 
parties may independently develop technologies that are competitive with ours and such competitive technologies may or may not infringe our intellectual 
property.  The  enforcement  of  our  intellectual  property  rights  also  depends  on  the  success  of  our  legal  actions  against  these  infringers  in  the  respective 
country  or  forum,  but  these  actions  may  not  be  successful.  As  with  all  granted  intellectual  property,  such  intellectual  property  may  be  challenged, 
invalidated or circumvented, may not provide specific protection and/or may not prove to be enforceable in actions against specific alleged infringers.

The market for biopharmaceuticals, pharmaceuticals, and treatments for diseases of aging is highly competitive and subject to rapid technological change. 
Our success depends, in part, upon our ability to maintain a competitive position 

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in the development and protection of technologies and products for use in these fields and upon our ability to obtain, maintain and enforce our intellectual 
property  rights  in  connection  therewith.  We  seek  to  obtain  and  maintain  patents  and  other  intellectual  property  rights  to  restrict  the  ability  of  others  to 
market products that misappropriate our technology and/or infringe our intellectual property to unfairly and illegally compete with our products. If we are 
unable to protect our intellectual property and proprietary rights, our competitive position and our business could be harmed, as third parties may be able to 
make, use, or sell products that are substantially the same as ours without incurring the sizeable development and licensing costs that we have incurred, 
which would adversely affect our ability to compete in the market.

We  use  a  combination  of  patents,  trademarks,  know-how,  confidentiality  procedures,  and  contractual  provisions  to  protect  our  proprietary  technology. 
However, these protections may not be adequate and may not provide us with any competitive advantage. For example, patents may not issue from any of 
our currently pending or any future patent applications, and our issued patents and any future patents that may issue may not survive legal challenges to 
their scope, validity or enforceability, or provide significant protection for us.

If we or one of our current or future collaborators were to initiate legal proceedings against a third party to enforce a patent covering one of our current 
drug  candidates  or  future  drug  candidates,  the  defendant  could  counterclaim  that  our  patent  is  invalid  and/or  unenforceable.  In  patent  litigation  in  the 
United States, defendant counterclaims alleging invalidity and/or unenforceability are commonplace.

Grounds  for  a  validity  challenge  could  be  an  alleged  failure  to  meet  any  of  several  statutory  requirements,  including  lack  of  novelty,  obviousness  or 
nonenablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld relevant 
information from the USPTO, or made a misleading statement, during prosecution. Third parties may also raise similar claims before the USPTO, even 
outside the context of litigation. The outcome following legal assertions of invalidity and unenforceability is unpredictable.

With respect to the validity question, for example, we cannot be certain that there is no invalidating prior art, of which we and the patent examiner were 
unaware  during  prosecution.  If  a  defendant  were  to  prevail  on  a  legal  assertion  of  invalidity  and/or  unenforceability,  we  would  lose  at  least  part,  and 
perhaps all, of the patent protection on our drug candidates. Such a loss of patent protection would have a material adverse impact on our business.

Even if our patents are determined by a court to be valid and enforceable, they may not be interpreted sufficiently broadly to prevent others from marketing 
products similar to ours or designing around our patents. For example, third parties may be able to make products that are similar to ours but that are not 
covered  by  the  claims  of  our  patents.  Third  parties  may  assert  that  we  or  our  licensors  were  not  the  first  to  make  the  inventions  covered  by  our  issued
patents  or  pending  patent  applications.  The  claims  of  our  issued  patents  or  patent  applications  when  issued  may  not  cover  our  proposed  commercial 
technologies or the future products that we develop. We may not have freedom to commercialize unimpeded by the patent rights of others. Third parties 
may have dominating, blocking, or other patents relevant to our technology of which we are not aware. There may be prior public disclosures or art that 
could be deemed to invalidate one or more of our patent claims. Further, we may not develop additional proprietary technologies in the future, and, if we 
do, they may not be patentable.

Patent law can be highly uncertain and involve complex legal and factual questions for which important principles remain unresolved. In the United States 
and  in  many  international  jurisdictions,  policy  regarding  the  breadth  of  claims  allowed  in  patents  can  be  inconsistent.  The  U.S.  Supreme  Court  and  the 
Court of Appeals for the Federal Circuit have made, and will likely continue to make, changes in how the patent laws of the United States are interpreted. 
Similarly, international courts have made, and will likely continue to make, changes in how the patent laws in their respective jurisdictions are interpreted.
We cannot predict future changes in the interpretation of patent laws or changes to patent laws that might be enacted into law by U.S. and international 
legislative  bodies.  Those  changes  may  materially  affect  our  patents,  our  ability  to  obtain  patents  or  the  patents  and  patent  applications  of  our  licensors. 
Patent  reform  legislation  in  the  United  States  could  increase  the  uncertainties  and  costs  surrounding  the  prosecution  of  our  patent  applications  and  the 
enforcement or defense of our issued patents. For example, on September 16, 2011, the Leahy-Smith America Invents Act, or Leahy-Smith Act, was signed 
into law. The Leahy-Smith Act included a number of significant changes to U.S. patent law. These include provisions that affect the way patent applications 
are prosecuted, redefine prior art, may affect patent litigation, and switch the U.S. patent system from a “first-to-invent” system to a “first-to-file” system. 
Under a “first-to-file” system, assuming the other requirements for patentability are met, the first inventor to 

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file a patent application generally will be entitled to the patent on an invention regardless of whether another inventor had made the invention earlier. The 
U.S. Patent and Trademark Office recently developed new regulations and procedures to govern administration of the Leahy-Smith Act, and many of the
substantive changes to patent law associated with the Leahy-Smith Act, and in particular, the first-to-file provisions, only became effective on March 16, 
2013. The Leahy-Smith Act and its implementation could increase the uncertainties and costs surrounding the prosecution of our patent applications and 
the enforcement or defense of our issued patents, which could have a material adverse effect on our business and financial condition.

In addition, we have a number of international patents and patent applications and expect to continue to pursue patent protection in many of the significant 
markets in which we intend to do business. The laws of some international jurisdictions may not protect intellectual property rights to the same extent as 
laws in the United States, and many companies have encountered significant difficulties in obtaining, protecting, and defending such rights in international 
jurisdictions.  If  we  encounter  such  difficulties  or  we  are  otherwise  precluded  from  effectively  protecting  our  intellectual  property  rights  in  international 
jurisdictions, our business prospects could be substantially harmed.

Varying filing dates in international countries may also permit intervening third parties to allege priority to certain technology.

Patent  terms  may  be  shortened  or  lengthened  by,  for  example,  terminal  disclaimers,  patent  term  adjustments,  supplemental  protection  certificates,  and 
patent term extensions. Patent term extensions and supplemental protection certificates, and the like, may be impacted by the regulatory process and may 
not significantly lengthen the patent term. Non-payment or delay in payment of patent fees or annuities, delay in patent filings or delay in extension filing 
(including any patent term extension or adjustment filing), whether intentional or unintentional, may also result in the loss of patent rights important to our 
business. Certain countries have compulsory licensing laws under which a patent owner may be compelled to grant licenses to other parties. In addition, 
many countries limit the enforceability of patents against other parties, including government agencies or government contractors. In these countries, the 
patent owner may have limited remedies, which could materially diminish the value of any patents.

In addition to the protection afforded by patents, we rely on confidentiality agreements to protect confidential information and proprietary know-how that is 
not patentable or that we elect not to patent, processes for which patents are difficult to enforce and any other elements of our drug candidate discovery and 
development processes that involve proprietary know-how, information or technology that is not covered by patents. We seek to protect our proprietary 
technology  and  processes,  in  part,  by  entering  into  confidentiality  agreements  with  our  employees,  consultants,  scientific  advisors,  and  contractors.  We 
cannot guarantee that we have entered into such agreements with each party that may have or have had access to our confidential information or proprietary 
technology and processes. We also seek to preserve the integrity and confidentiality of our data and other confidential information by maintaining physical 
security  of  our  premises  and  physical  and  electronic  security  of  our  information  technology  systems.  While  we  have  confidence  in  these  individuals, 
organizations and systems, agreements or security measures may be breached and detecting the disclosure or misappropriation of confidential information 
and  enforcing  a  claim  that  a  party  illegally  disclosed  or  misappropriated  confidential  information  is  difficult,  expensive  and  time-consuming,  and  the 
outcome is unpredictable. Further, we may not be able to obtain adequate remedies for any breach. In addition, our confidential information may otherwise 
become known or be independently discovered by competitors, in which case we would have no right to prevent them, or those to whom they communicate 
it, from using that technology or information to compete with us. We may in the future rely on trade secret protection, which would be subject to the risks 
identified above with respect to confidential information.

Monitoring unauthorized use of our intellectual property is difficult and costly. From time to time, we review our competitors’ products, and may in the 
future seek to enforce our patents or other rights against potential infringement. However, the steps we have taken to protect our proprietary rights may not 
be adequate to prevent misappropriation of our intellectual property. We may not be able to detect unauthorized use of, or take appropriate steps to enforce, 
our intellectual property rights. Our competitors may also independently develop similar technology. Any inability to meaningfully protect our intellectual 
property could result in competitors offering products that incorporate our product or service features, which could reduce demand for our products. In 
addition, we may need to defend our patents from third-party challenges, such as (but not limited to) interferences, derivation proceedings, reexamination 
proceedings,  post-grant  review,  inter  partes  review,  third-party  submissions,  oppositions,  nullity  actions  or  other  patent  proceedings.  We  may  need  to 
initiate infringement claims or litigation.

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Adverse  proceedings  such  as  litigation  can  be  expensive,  time  consuming  and  may  divert  the  efforts  of  our  technical  and  managerial  personnel,  which 
could in turn harm our business, whether or not we receive a determination favorable to us. In addition, in an infringement proceeding, a court or other 
judicial body may decide that the patent we seek to enforce is invalid or unenforceable, or may refuse to stop the other party from using the technology at 
issue on the grounds that the patent in question does not cover the technology in question. An adverse result in any litigation could put one or more of our 
patents  at  risk  of  being  invalidated  or  interpreted  narrowly.  Some  of  our  competitors  may  be  able  to  devote  significantly  more  resources  to  intellectual 
property  litigation  and  may  have  significantly  broader  patent  portfolios  to  assert  against  us  if  we  assert  our  rights  against  them.  Further,  because  of  the 
substantial discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be disclosed 
or otherwise compromised during litigation.

We  may  not  be  able  to  correctly  estimate  or  control  our  future  operating  expenses  in  relation  to  obtaining  intellectual  property,  enforcing  intellectual 
property and/or defending intellectual property, which could affect operating expenses. Our operating expenses may fluctuate significantly in the future as a 
result  of  a  variety  of  factors,  including  the  costs  of  preparing,  filing,  prosecuting,  defending,  and  enforcing  patent  and  trademark  claims  and  other 
intellectual property-related costs, including adverse proceedings (such as litigation) costs.

Our intellectual property agreements with third parties may be subject to disagreements over contract interpretation, which could narrow the scope of 
our rights to the relevant intellectual property or technology or increase our financial or other obligations to our licensors.

Certain  provisions  in  our  intellectual  property  agreements  may  be  susceptible  to  multiple  interpretations.  The  resolution  of  any  contract  interpretation 
disagreement that may arise could affect the scope of our rights to the relevant intellectual property or technology, or affect financial or other obligations 
under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations and prospects.

In addition, while it is our policy to require our employees and contractors who may be involved in the conception or development of intellectual property 
to  execute  agreements  assigning  such  intellectual  property  to  us,  we  may  be  unsuccessful  in  executing  such  an  agreement  with  each  party  who  in  fact 
conceives or develops intellectual property that we regard as our own. Our assignment agreements may not be self-executing or may be breached, and we
may  be  forced  to  bring  claims  against  third  parties,  or  defend  claims  they  may  bring  against  us,  to  determine  the  ownership  of  what  we  regard  as  our 
intellectual property.

If  we  are  unable  to  protect  the  confidentiality  of  our  proprietary  information  and  know-how,  the  value  of  our  technology  and  products  could  be 
adversely affected.

We  may  not  be  able  to  protect  our  proprietary  information  and  technology  adequately.  Although  we  use  reasonable  efforts  to  protect  our  proprietary 
information, technology, and know-how, our employees, consultants, contractors and outside scientific advisors may unintentionally or willfully disclose 
our information to competitors. Enforcing a claim that a third party illegally obtained and is using any of our proprietary information, technology or know-
how is expensive and time consuming, and the outcome is unpredictable. In addition, courts outside the United States are sometimes less willing to protect 
proprietary information, technology, and know-how. We rely, in part, on non-disclosure and confidentiality agreements with our employees, consultants and 
other  parties  to  protect  our  proprietary  information,  technology,  and  know-how.  These  agreements  may  be  breached  and  we  may  not  have  adequate 
remedies for any breach. Moreover, others may independently develop similar or equivalent proprietary information, and third parties may otherwise gain 
access to our proprietary knowledge.

Risks Related to Government Regulation

Even if we obtain regulatory approval for a drug candidate, our products will remain subject to regulatory scrutiny.

If our drug candidates are approved, they will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, advertising, 
promotion, sampling, record-keeping, conduct of post-marketing studies, and submission of safety, efficacy, and other post-market information, including 
both federal and state requirements in the United States and requirements of comparable foreign regulatory authorities.

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Manufacturers  and  manufacturers’  facilities  are  required  to  comply  with  extensive  FDA  and  comparable  foreign  regulatory  authority  requirements, 
including ensuring that quality control and manufacturing procedures conform to cGMP regulations. As such, we and our contract manufacturers will be 
subject to continual review and inspections to assess compliance with cGMP and adherence to commitments made in any approved marketing application. 
Accordingly,  we  and  others  with  whom  we  work  must  continue  to  expend  time,  money,  and  effort  in  all  areas  of  regulatory  compliance,  including 
manufacturing, production, and quality control.

We  will  have  to  comply  with  requirements  concerning  advertising  and  promotion  for  our  products.  Promotional  communications  with  respect  to 
prescription drugs and biologics are subject to a variety of legal and regulatory restrictions and must be consistent with the information in the product’s 
approved  label.  As  such,  we  may  not  promote  our  products  for  indications  or  uses  for  which  they  do  not  have  approval.  The  holder  of  an  approved 
application  must  submit  new  or  supplemental  applications  and  obtain  approval  for  certain  changes  to  the  approved  product,  product  labeling,  or 
manufacturing process. We could also be asked to conduct post-marketing clinical studies to verify the safety and efficacy of our products in general or in 
specific patient subsets. An unsuccessful post-marketing study or failure to complete such a study could result in the withdrawal of marketing approval.

If a regulatory agency discovers previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems 
with  the  facility  where  the  product  is  manufactured,  or  disagrees  with  the  promotion,  marketing  or  labeling  of  a  product,  such  regulatory  agency  may 
impose restrictions on that product or us, including requiring withdrawal of the product from the market. If we fail to comply with applicable regulatory 
requirements, a regulatory agency or enforcement authority may, among other things:

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issue warning letters;

impose civil or criminal penalties;

suspend or withdraw regulatory approval;

suspend any of our clinical studies;

refuse to approve pending applications or supplements to approved applications submitted by us;

impose restrictions on our operations, including closing our contract manufacturers’ facilities; or

seize or detain products or require a product recall.

Any  government  investigation  of  alleged  violations  of  law  could  require  us  to  expend  significant  time  and  resources  in  response  and  could  generate 
negative publicity. Any failure to comply with ongoing regulatory requirements may significantly and adversely affect our ability to commercialize and 
generate revenue from our products. If regulatory sanctions are applied or if regulatory approval is withdrawn, the value of our company and our operating 
results will be adversely affected.

Moreover,  the  policies  of  the  FDA  and  of  other  regulatory  authorities  may  change  and  additional  government  regulations  may  be  enacted  that  could 
prevent, limit or delay regulatory approval of our drug candidates. We cannot predict the likelihood, nature or extent of government regulation that may 
arise from future legislation or administrative or executive action, either in the United States or abroad. 

If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain 
regulatory compliance, we may be subject to enforcement action, and we may not achieve or sustain profitability.

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If any of our small molecule drug candidates obtain regulatory approval, additional competitors could enter the market with generic versions of such 
drugs, which may result in a material decline in sales of affected products.

Under  the  Drug  Price  Competition  and  Patent  Term  Restoration  Act  of  1984,  or  the  Hatch-Waxman  Act,  a  pharmaceutical  manufacturer  may  file  an 
abbreviated new drug application, or ANDA, seeking approval of a generic version of an approved, small molecule innovator product. Under the Hatch-
Waxman Act, a manufacturer may also submit a new drug application, or NDA, under section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act that 
references  the  FDA’s  prior  approval  of  the  small  molecule  innovator  product.  A  505(b)(2)  NDA  product  may  be  for  a  new  or  improved  version  of  the 
original innovator product. The Hatch-Waxman Act also provides for certain periods of regulatory exclusivity, which preclude FDA approval (or in some 
circumstances, FDA filing and review) of an ANDA or 505(b)(2) NDA. In addition to the benefits of regulatory exclusivity, an innovator NDA holder may 
have  patents  claiming  the  active  ingredient,  product  formulation  or  an  approved  use  of  the  drug,  which  would  be  listed  with  the  product  in  the  FDA 
publication, “Approved Drug Products with Therapeutic Equivalence Evaluations,” known as the Orange Book. If there are patents listed in the Orange 
Book for a product, a generic or 505(b)(2) applicant that seeks to market its product before expiration of the patents must include in their applications what 
is  known  as  a  “Paragraph  IV”  certification,  challenging  the  validity  or  enforceability  of,  or  claiming  non-infringement  of,  the  listed  patent  or  patents. 
Notice of the certification must be given to the patent owner and NDA holder and if, within 45 days of receiving notice, either the patent owner or NDA 
holder sues for patent infringement, approval of the ANDA or 505(b)(2) NDA is stayed for up to 30 months.

Accordingly, if any of our small molecule drug candidates, such as UBX1325, are approved, competitors could file ANDAs for generic versions of our 
small molecule drug products or 505(b)(2) NDAs that reference our small molecule drug products. If there are patents listed for our small molecule drug 
products in the Orange Book, those ANDAs and 505(b)(2) NDAs would be required to include a certification as to each listed patent indicating whether the 
ANDA applicant does or does not intend to challenge the patent. We cannot predict which, if any, patents in our current portfolio or patents we may obtain 
in the future will be eligible for listing in the Orange Book, how any generic competitor would address such patents, whether we would sue on any such 
patents, or the outcome of any such suit.

We may not be successful in securing or maintaining proprietary patent protection for products and technologies we develop or license. Moreover, if any of 
our  owned  or  in-licensed  patents  that  are  listed  in  the  Orange  Book  are  successfully  challenged  by  way  of  a  Paragraph  IV  certification  and  subsequent 
litigation, the affected product could immediately face generic competition and its sales would likely decline rapidly and materially.

Any biologic, or large molecule, drug candidates for which we intend to seek approval may face competition sooner than anticipated.

If we are successful in achieving regulatory approval to commercialize any biologic drug candidate faster than our competitors, such drug candidates may 
face competition from biosimilar products. In the United States, large molecule drug candidates are regulated by the FDA as biologic products subject to 
approval under the biologics license application, or BLA, pathway. The Biologics Price Competition and Innovation Act of 2009, or BPCIA, creates an 
abbreviated  pathway  for  the  approval  of  biosimilar  and  interchangeable  biologic  products  following  the  approval  of  an  original  BLA.  The  abbreviated 
regulatory pathway establishes legal authority for the FDA to review and approve biosimilar biologics, including the possible designation of a biosimilar as 
“interchangeable” based on its similarity to an existing brand product. Under the BPCIA, an application for a biosimilar product cannot be approved by the 
FDA until 12 years after the original branded product was approved under a BLA. The law is complex and is still being interpreted and implemented by the 
FDA. As a result, its ultimate impact, implementation, and meaning are subject to uncertainty.

Moreover, the extent to which a biosimilar product, once approved, will be substituted for any one of our reference products in a way that is similar to 
traditional generic substitution for non-biologic products is not yet clear, and will depend on a number of marketplace and regulatory factors that are still 
developing. In addition, a competitor could decide to forego the biosimilar approval path and submit a full BLA after completing its own preclinical studies 
and clinical studies. In such cases, any exclusivity to which we may be eligible under the BPCIA would not prevent the competitor from marketing its 
product as soon as it is approved.

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If  competitors  are  able  to  obtain  marketing  approval  for  biosimilars  referencing  our  large  molecule  drug  candidates,  if  approved,  such  products  may 
become  subject  to  competition  from  such  biosimilars,  with  the  attendant  competitive  pressure  and  potential  adverse  consequences.  Such  competitive 
products may be able to immediately compete with us in each indication for which our drug candidates may have received approval.

Enacted  and  future  healthcare  legislation  may  increase  the  difficulty  and  cost  for  us  to  obtain  marketing  approval  of  and  commercialize  our  drug 
candidates and may affect the prices we may set.

In the United States, the European Union and other jurisdictions, there have been, and we expect there will continue to be, a number of legislative and 
regulatory  changes  and  proposed  changes  to  the  healthcare  system  that  could  affect  our  future  results  of  operations.  In  particular,  there  have  been  and 
continue to be a number of initiatives at the U.S. federal and state levels that seek to reduce healthcare costs and improve the quality of healthcare. For 
example, in March 2010, the Patient Protection and ACA, as amended by the Health Care and Education Reconciliation Act, or collectively the Affordable 
Care Act, was enacted, which substantially changed the way healthcare is financed by both governmental and private insurers. Among the provisions of the 
ACA, those of greatest importance to the pharmaceutical and biotechnology industries include the following:

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an  annual,  non-deductible  fee  payable  by  any  entity  that  manufactures  or  imports  certain  branded  prescription  drugs  and  biologic  agents 
(other  than  those  designated  as  orphan  drugs),  which  is  apportioned  among  these  entities  according  to  their  market  share  in  certain 
government healthcare programs;

a  new  Medicare  Part  D  coverage  gap  discount  program,  in  which  manufacturers  must  agree  to  offer  70%  point-of-sale  discounts  off 
negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s 
outpatient drugs to be covered under Medicare Part D;

an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program to 23.1% and 13.0% of the 
average manufacturer price for branded and generic drugs, respectively;

a  new  methodology  by  which  rebates  owed  by  manufacturers  under  the  Medicaid  Drug  Rebate  Program  are  calculated  for  drugs  that  are 
inhaled, infused, instilled, implanted or injected;

extension of a manufacturer’s Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care 
organizations;

expansion  of  eligibility  criteria  for  Medicaid  programs  by,  among  other  things,  allowing  states  to  offer  Medicaid  coverage  to  certain 
individuals  with  income  at  or  below  133%  of  the  federal  poverty  level,  thereby  potentially  increasing  a  manufacturer’s  Medicaid  rebate 
liability;

a  new  Patient-Centered  Outcomes  Research  Institute  to  oversee,  identify  priorities  in,  and  conduct  comparative  clinical  effectiveness 
research, along with funding for such research;

creation of the Independent Payment Advisory Board, which, once empaneled, will have the authority to recommend certain changes to the 
Medicare  program  that  could  result  in  reduced  payments  for  prescription  drugs  and  those  recommendations  could  have  the  effect  of  law 
unless overruled by a supermajority vote of Congress; and

establishment of a Center for Medicare Innovation at the Centers for Medicare & Medicaid Services, or CMS, to test innovative payment and 
service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending.

Since its enactment, there have been judicial and Congressional challenges to certain aspects of the Affordable Care Act. For example, the Tax Cuts and 
Jobs Act of 2017, or the Tax Act, includes a provision repealing, effective January 1, 2019, the tax-based shared responsibility payment imposed by the 
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qualifying  health  coverage  for  all  or  part  of  a  year  that  is  commonly  referred  to  as  the  “individual  mandate”.  In  addition,  there  may  be  other  efforts  to 
challenge, repeal or replace the ACA that may impact our business or financial condition.

In addition, other legislative changes have been proposed and adopted in the United States since the Affordable Care Act was enacted. In August 2011, the 
Budget Control Act of 2011, among other things, led to aggregate reductions of Medicare payments to providers of 2% per fiscal year. These reductions 
went into effect in April 2013 and, due to subsequent legislative amendments to the statute, will remain in effect through 2030, with the exception of a 
temporary  suspension  from  May  1,  2020  through  December  31,  2021,  unless  additional  action  is  taken  by  Congress.  In  addition,  in  January  2013,  the 
American Taxpayer Relief Act of 2012 was signed into law, which, among other things, further reduced Medicare payments to several types of providers, 
including  hospitals,  imaging  centers  and  cancer  treatment  centers,  and  increased  the  statute  of  limitations  period  for  the  government  to  recover 
overpayments to providers from three to five years.

Individual  states  in  the  United  States  have  also  become  increasingly  aggressive  in  passing  legislation  and  implementing  regulations  designed  to  control 
pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and 
marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. 
Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, results of operations, financial 
condition and prospects. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what 
pharmaceutical  products  and  which  suppliers  will  be  included  in  their  prescription  drug  and  other  healthcare  programs.  This  could  reduce  the  ultimate 
demand  for  our  drug  candidates  or  put  pressure  on  our  product  pricing.  Moreover,  payment  methodologies  may  be  subject  to  changes  in  healthcare 
legislation and regulatory initiatives. For example, CMS may develop new payment and delivery models, such as bundled payment models. In addition, 
recently there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products.

In the European Union, similar political, economic and regulatory developments may affect our ability to profitably commercialize our drug candidates, if 
approved. In addition to continuing pressure on prices and cost containment measures, legislative developments at the EU or member state level may result 
in significant additional requirements or obstacles that may increase our operating costs. The delivery of healthcare in the European Union, including the 
establishment and operation of health services and the pricing and reimbursement of medicines, is almost exclusively a matter for national, rather than EU, 
law and policy. National governments and health service providers have different priorities and approaches to the delivery of health care and the pricing 
and  reimbursement  of  products  in  that  context.  In  general,  however,  the  healthcare  budgetary  constraints  in  most  European  Union  member  states  have 
resulted in restrictions on the pricing and reimbursement of medicines by relevant health service providers. Coupled with ever-increasing EU and national
regulatory burdens on those wishing to develop and market products, this could prevent or delay marketing approval of our drug candidates, restrict or 
regulate  post-approval  activities  and  affect  our  ability  to  commercialize  our  drug  candidates,  if  approved.  In  markets  outside  of  the  United  States  and 
European  Union,  reimbursement  and  healthcare  payment  systems  vary  significantly  by  country,  and  many  countries  have  instituted  price  ceilings  on 
specific products and therapies.

We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action in the United 
States,  the  European  Union  or  any  other  jurisdiction.  If  we  or  any  third  parties  we  may  engage  are  slow  or  unable  to  adapt  to  changes  in  existing 
requirements  or  the  adoption  of  new  requirements  or  policies,  or  if  we  or  such  third  parties  are  not  able  to  maintain  regulatory  compliance,  our  drug 
candidates may lose any regulatory approval that may have been obtained and we may not achieve or sustain profitability.

Our  business  operations  and  current  and  future  relationships  with  investigators,  healthcare  professionals,  consultants,  third-party  payors,  patient 
organizations and customers will be subject to applicable healthcare regulatory laws, which could expose us to penalties.

Our  business  operations  and  current  and  future  arrangements  with  investigators,  healthcare  professionals,  consultants,  third-party  payors,  patient 
organizations and customers, may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations. These laws may constrain the 
business or financial arrangements and 

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relationships through which we conduct our operations, including how we research, market, sell and distribute our drug candidates, if approved.

Such laws include:

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the  U.S.  federal  Anti-Kickback  Statute,  which  prohibits,  among  other  things,  persons  or  entities  from  knowingly  and  willfully  soliciting, 
offering, receiving or providing any remuneration (including any kickback, bribe, or certain rebate), directly or indirectly, overtly or covertly, 
in  cash  or  in  kind,  to  induce  or  reward,  or  in  return  for,  either  the  referral  of  an  individual  for,  or  the  purchase,  lease,  order  or 
recommendation of, any good, facility, item or service, for which payment may be made, in whole or in part, under U.S. federal and state 
healthcare programs such as Medicare and Medicaid. 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;

the  U.S.  federal  false  claims  and  civil  monetary  penalties  laws,  including  the  civil  False  Claims  Act,  which,  among  other  things,  impose 
criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, 
or causing to be presented, to the U.S. federal government, claims for payment or approval that are false or fraudulent, knowingly making, 
using or causing to be made or used, a false record or statement material to a false or fraudulent claim, or from knowingly making a false 
statement to avoid, decrease or conceal an obligation to pay money to the U.S. federal government. In addition, the government may assert 
that a claim including items and services resulting from a violation of the U.S. federal Anti-Kickback Statute constitutes a false or fraudulent 
claim for purposes of the False Claims Act;

the  U.S.  federal  Health  Insurance  Portability  and  Accountability  Act  of  1996,  or  HIPAA,  which  imposes  criminal  and  civil  liability  for, 
among  other  things,  knowingly  and  willfully  executing,  or  attempting  to  execute,  a  scheme  to  defraud  any  healthcare  benefit  program,  or 
knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement, in connection with the 
delivery of, or payment for, healthcare benefits, items or services; similar to the U.S. federal Anti-Kickback Statute, 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;

the FDCA, which prohibits, among other things, the adulteration or misbranding of drugs, biologics and medical devices;

the U.S. Public Health Service Act, which prohibits, among other things, the introduction into interstate commerce of a biological product 
unless a biologics license is in effect for that product;

the U.S. Physician Payments Sunshine Act and its implementing regulations, which require certain manufacturers of drugs, devices, biologics 
and medical supplies that are reimbursable under Medicare, Medicaid, or the Children’s Health Insurance Program to report annually to the 
government  information  related  to  certain  payments  and  other  transfers  of  value  to  physicians  (defined  to  include  doctors,  dentists, 
optometrists, podiatrists and chiropractors), certain other healthcare providers starting in 2022, and teaching hospitals, as well as ownership 
and investment interests held by the physicians described above and their immediate family members;

analogous U.S. state laws and regulations, including: state anti-kickback and false claims laws, which may apply to our business practices, 
including  but  not  limited  to,  research,  distribution,  sales  and  marketing  arrangements  and  claims  involving  healthcare  items  or  services 
reimbursed  by  any  third-party  payor,  including  private  insurers;  state  laws  that  require  pharmaceutical  companies  to  comply  with  the 
pharmaceutical  industry’s  voluntary  compliance  guidelines  and  the  relevant  compliance  guidance  promulgated  by  the  U.S.  federal 
government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; and state laws and 
regulations that require drug manufacturers to file reports relating to pricing and marketing information, which requires tracking gifts and 
other remuneration and items of value provided to healthcare professionals and entities; and

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similar healthcare laws and regulations in the European Union and other jurisdictions, including reporting requirements detailing interactions 
with and payments to healthcare providers.

Ensuring  that  our  internal  operations  and  future  business  arrangements  with  third  parties  comply  with  applicable  healthcare  laws  and  regulations  will 
involve substantial costs. It is possible that governmental authorities will conclude that our business practices do not comply with current or future statutes, 
regulations, agency guidance or case law involving applicable fraud and abuse or other healthcare laws and regulations. If our operations are found to be in 
violation  of  any  of  the  laws  described  above  or  any  other  governmental  laws  and  regulations  that  may  apply  to  us,  we  may  be  subject  to  significant 
penalties, including civil, criminal and administrative penalties, damages, fines, exclusion from government-funded healthcare programs, such as Medicare 
and  Medicaid  or  similar  programs  in  other  countries  or  jurisdictions,  disgorgement,  individual  imprisonment,  contractual  damages,  reputational  harm, 
diminished profits and the curtailment or restructuring of our operations. Further, defending against any such actions can be costly, time-consuming and 
may require significant personnel resources. Therefore, even if we are successful in defending against any such actions that may be brought against us, our 
business may be impaired.

U.S.  tax  legislation  and  future  changes  to  applicable  U.S.  tax  laws  and  regulations  may  have  a  material  adverse  effect  on  our  business,  financial 
condition and results of operations.

New  income,  sales,  use  or  other  tax  laws,  statutes,  rules,  regulations  or  ordinances  could  be  enacted  at  any  time,  or  interpreted,  changed,  modified  or 
applied adversely to us, any of which could adversely affect our business operations and financial performance. We are currently unable to predict whether 
such changes will occur and, if so, the ultimate impact on our business. To the extent that such changes have a negative impact on us, our suppliers or our 
customers,  including  as  a  result  of  related  uncertainty,  these  changes  may  materially  and  adversely  impact  our  business,  financial  condition,  results  of 
operations and cash flows.

Risks Related to Ownership of Our Common Stock 

Our stock price may be volatile and you may not be able to resell shares of our common stock at or above the price you paid.

The trading price of our common stock has been and may continue to be highly volatile and may be subject to wide fluctuations in response to various 
factors, some of which are beyond our control.

These factors include those discussed in this “Risk Factors” section of this report and others such as:

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results  from,  and  any  delays  in,  commencing,  conducting  or  completing  our  clinical  studies  for  our  current  drug  candidates,  or  any  other 
future clinical development programs;

announcements  by  academic  or  other  third  parties  challenging  the  fundamental  premises  underlying  our  approach  to  treating  diseases  of 
aging and/or drug development;

announcements of regulatory approval or disapproval of our current or any future drug candidates;

failure or discontinuation of any of our research and development programs;

announcements relating to future licensing, collaboration, or development agreements;

our ability to maintain compliance with Nasdaq listing standards;

delays in the commercialization of our current or any future drug candidates;

public misperception regarding the use of our therapies, or public bias of against “anti-aging” companies;

acquisitions and sales of new products, technologies, or businesses;

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manufacturing and supply issues related to our drug candidates for clinical studies or future drug candidates for commercialization;

quarterly variations in our results of operations or those of our future competitors;

changes in earnings estimates or recommendations by securities analysts;

announcements  by  us  or  our  competitors  of  new  products,  significant  contracts,  commercial  relationships,  acquisitions,  or  capital 
commitments;

developments with respect to intellectual property rights;

our commencement of, or involvement in, litigation;

changes in financial estimates or guidance, including our ability to meet our future revenue and operating profit or loss estimates or guidance; 

any major changes in our board of directors or management;

new legislation in the United States relating to the sale or pricing of pharmaceuticals;

FDA or other U.S. or foreign regulatory actions affecting us or our industry;

product liability claims or other litigation or public concern about the safety of our drug candidates;

market conditions in the pharmaceutical, biopharmaceutical and biotechnology sectors; and

general economic conditions in the United States and abroad, including high interest rates, rising inflation, the government closure of Silicon 
Valley Bank and liquidity concerns at other financial institutions, and the potential for local and/or global economic recession.

In addition, the stock markets in general, and the markets for pharmaceutical, biopharmaceutical, and biotechnology stocks in particular, have experienced 
extreme volatility as a result of the COVID-19 pandemic, economic uncertainty and increased interest rates, inflation, the government closure of Silicon 
Valley  Bank  and  liquidity  concerns  at  other  financial  institutions  that  may  be  unrelated  to  the  operating  performance  of  the  issuer.  These  broad  market 
fluctuations may adversely affect the trading price or liquidity of our common stock. In the past, when the market price of a stock has been volatile, holders 
of that stock have sometimes instituted securities class action litigation against the issuer. If any of our stockholders were to bring such a lawsuit against us, 
we could incur substantial costs defending the lawsuit and the attention of our management would be diverted from the operation of our business.

On October 19, 2022, we effected a 1-for-10 reverse stock split of our common stock seeking to regain compliance with Nasdaq Global Select Market's 
continued  listing  standards.  As  a  result  of  the  reverse  stock  split,  the  split-adjusted  per  share  market  price  of  our  common  stock  increased  and,  from 
October 20, 2022 to November 2, 2022 (10 consecutive business days), the closing bid price of our common stock exceeded $1.00 per share. Accordingly, 
on November 3, 2022, we received a notice from Nasdaq indicating that we have regained compliance with Listing Rule 5450(a)(1) as of such date. See the 
risk  factor  titled  “We  may  not  be  able  to  maintain  compliance  with  the  continued  listing  requirements  of  Nasdaq  and,  if  so,  we  would  be  subject  to 
delisting.” for additional information about our ability to maintain compliance with the continued listing requirements of Nasdaq. Although we currently 
comply with the minimum bid requirement following the reverse stock split, we cannot assure you that we will be able to maintain compliance with the
continued listing requirements of Nasdaq and any delisting would adversely affect our stock price and the liquidity of our common stock. 

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An active, liquid and orderly market for our common stock may not develop and may not be maintained.

Prior to our initial public offering in May 2018, there was no public market for shares of our common stock. Although our common stock is listed on the 
Nasdaq Global Select Market, an active trading market for our common stock may never be sustained on the Nasdaq Global Select Market or any other 
exchange in the future. On October 19, 2022, we effected a 1-for-10 reverse stock split of our common stock seeking to bring us into compliance with the 
minimum required losing bid price for continued listing on the Nasdaq Global Select Market and to regain compliance with Nasdaq Global Select Market's 
continued listing standards. While we have regained compliance, we cannot assure that we will continue to meet the minimum required closing bid price 
for continued listing on the Nasdaq Global Select Market in the future or that we will be able to maintain our listing on the Nasdaq Global Select Market or 
any other exchange. See the risk factor titled “We may not be able to maintain compliance with the continued listing requirements of Nasdaq and, if so, we 
would be subject to delisting.” for additional information about our ability to maintain compliance with the continued listing requirements of Nasdaq. The 
lack of an active market may impair your ability to sell your shares at the time you wish to sell them or at a price that you consider reasonable. An inactive 
market may also impair our ability to raise capital by selling shares and may impair our ability to acquire other businesses, applications, or technologies 
using our shares as consideration. 

If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our 
stock, our stock price and trading volume could decline.

The trading market for our common stock is influenced by the research and reports that industry or securities analysts publish about us or our business. In 
the event any of the analysts who cover us issue an adverse or misleading opinion regarding us, our business model, our intellectual property or our stock 
performance, or if our clinical studies and operating results fail to meet the expectations of analysts, our stock price would likely decline. If one or more of 
these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our 
stock price or trading volume to decline. If our public float stays below $75.0 million, the risk that analysts cease to cover our stock may increase.

If  we  sell  shares  of  our  common  stock  in  future  financings,  stockholders  may  experience  immediate  dilution  and,  as  a  result,  our  stock  price  may 
decline.

We may from time to time issue additional shares of common stock at a discount from the current trading price of our common stock. As a result, our 
stockholders would experience immediate dilution upon the purchase of any shares of our common stock sold at such discount. For example, we may issue 
additional  shares  from  time  to  time  pursuant  to  our  shelf  registration  statements  and  ATM  Offering  Programs.  In  addition,  as  opportunities  present 
themselves, we may enter into financing or similar arrangements in the future, including the issuance of debt securities, preferred stock or common stock. 
However, for so long as our public float is less than $75.0 million, under our shelf registration statements, we may not sell more than the equivalent of one-
third of our public float during any 12 consecutive months pursuant to the baby shelf rules.

On September 29, 2021, we entered into a Purchase Agreement with Lincoln Park Capital Fund, LLC, under which we may at our discretion sell up to 
$30.0 million shares of our common stock, subject to certain daily limits, applicable prices, and conditions. As of December 31, 2021, we issued and sold 
417,285 shares of our common stock under our Purchase Agreement with Lincoln Park amounting to $8.3 million in gross proceeds. In addition, under the 
Purchase Agreement, we issued 25,244 shares of our common stock to Lincoln Park as consideration for its commitment to purchase shares of our common 
stock under the Purchase Agreement.

We generally have the right to control the timing and amount of any future sales of our common stock to Lincoln Park. Sales of shares of our common 
stock, if any, to Lincoln Park will depend upon market conditions and other factors to be determined by us. We may ultimately decide to sell to Lincoln 
Park all, some or none of the additional shares of our common stock that may be available for us to sell under the Purchase Agreement. If and when we do 
sell shares of our common stock to Lincoln Park, after Lincoln Park has acquired the shares of common stock, Lincoln Park may resell all, some or none of 
those shares of common stock at any time or in its discretion. The sale by Lincoln Park of a substantial number of shares of our common stock issued by us 
to Lincoln Park under the Purchase Agreement or the anticipation of such sales, could make it more difficult for us to sell equity or equity-related securities 
in the future at a time and at a price that we might otherwise wish to effect sales.

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Sales of substantial amounts of shares of our common stock or other securities by our stockholders, by us under our shelf registration statements or the 
ATM Offering Programs, or otherwise or by Lincoln Park or through the Hercules Amendment or through any other means could also lower the market 
price of our common stock and impair our ability to raise capital through the sale of equity or equity-related securities.

Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.

We have incurred substantial losses during our history and may never achieve profitability. To the extent that we continue to generate taxable losses, unused 
losses will carry forward to offset a portion of future taxable income, if any, until such unused losses expire, if ever. Under Sections 382 and 383 of the 
Internal Revenue Code of 1986, as amended, if a corporation undergoes an “ownership change,” generally defined as a greater than 50 percentage point 
change (by value) in its equity ownership by certain stockholders over a three-year period, the corporation’s ability to use its pre-change net operating loss 
carryforwards, or NOLs, and other pre-change tax attributes (such as research and development tax credits) to offset its post-change income or taxes may 
be limited. We may have experienced ownership changes in the past and may experience ownership changes in the future as a result of subsequent shifts in 
our stock ownership (some of which shifts are outside our control). As a result, if we earn net taxable income, our ability to use our pre-change NOLs to 
offset such taxable income could be subject to limitations. Similar provisions of state tax law may also apply. As a result, even if we achieve profitability, 
we may be unable to use a material portion of our NOLs and other tax attributes.

Provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable and may lead to 
entrenchment of management.

Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that could delay or prevent changes in control or 
changes in our management without the consent of our board of directors. These provisions include the following:

•

•

•

•

•

•

•

•

a classified board of directors with three-year staggered terms, which may delay the ability of stockholders to change the membership of a 
majority of our board of directors;

no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;

the  exclusive  right  of  our  board  of  directors  to  elect  a  director  to  fill  a  vacancy  created  by  the  expansion  of  the  board  of  directors  or  the 
resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors;

the ability of our board of directors to authorize the issuance of shares of preferred stock and to determine the price and other terms of those 
shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a 
hostile acquiror;

the ability of our board of directors to alter our amended and restated bylaws without obtaining stockholder approval;

the required approval of at least 66 2/3% of the shares entitled to vote at an election of directors to adopt, amend or repeal our amended and 
restated  bylaws  or  repeal  the  provisions  of  our  amended  and  restated  certificate  of  incorporation  regarding  the  election  and  removal  of 
directors;

a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our 
stockholders;

the  requirement  that  a  special  meeting  of  stockholders  may  be  called  only  by  the  chief  executive  officer  or  the  president  or  the  board  of 
directors, which may delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of 
directors; and

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•

advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters 
to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to 
elect the acquiror’s own slate of directors or otherwise attempting to obtain control of us.

We are also subject to the anti-takeover provisions contained in Section 203 of the Delaware General Corporation Law. Under Section 203, a corporation 
may not, in general, engage in a business combination with any holder of 15% or more of its capital stock unless the holder has held the stock for three 
years or, among other exceptions, the board of directors has approved the transaction.

Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may 
reduce the amount of money available to us.

Our amended and restated certificate of incorporation and amended and restated bylaws provide that we will indemnify our directors and officers, in each 
case to the fullest extent permitted by Delaware law.

In addition, as permitted by Section 145 of the Delaware General Corporation Law, our amended and restated bylaws and our indemnification agreements 
that we have entered into with our directors and officers provide that:

•

•

•

•

•

We will indemnify our directors and officers for serving us in those capacities or for serving other business enterprises at our request, to the 
fullest extent permitted by Delaware law. Delaware law provides that a corporation may indemnify such person if such person acted in good 
faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the registrant and, with respect to any 
criminal proceeding, had no reasonable cause to believe such person’s conduct was unlawful.

We may, in our discretion, indemnify employees and agents in those circumstances where indemnification is permitted by applicable law.

We are required to advance expenses, as incurred, to our directors and officers in connection with defending a proceeding, except that such 
directors or officers shall undertake to repay such advances if it is ultimately determined that such person is not entitled to indemnification. 
We will not be obligated pursuant to our amended and restated bylaws to indemnify a person with respect to proceedings initiated by that 
person against us or our other indemnitees, except with respect to proceedings authorized by our board of directors or brought to enforce a 
right to indemnification.

The rights conferred in our amended and restated bylaws are not exclusive, and we are authorized to enter into indemnification agreements 
with our directors, officers, employees and agents and to obtain insurance to indemnify such persons.

We may not retroactively amend our amended and restated bylaw provisions to reduce our indemnification obligations to directors, officers, 
employees and agents.

We do not currently intend to pay dividends on our common stock, and, consequently, your ability to achieve a return on your investment will depend 
on appreciation in the price of our common stock.

We do not currently intend to pay any cash dividends on our common stock for the foreseeable future. We currently intend to invest our future earnings, if 
any, to fund our growth. Therefore, you are not likely to receive any dividends on your common stock for the foreseeable future. Since we do not intend to 
pay dividends, your ability to receive a return on your investment will depend on any future appreciation in the market value of our common stock. There is 
no guarantee that our common stock will appreciate or even maintain the price at which our holders have purchased it. 

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General Risk Factors

Unfavorable global economic or political conditions could adversely affect our business, financial condition or results of operations.

Our results of operations could be adversely affected by general conditions in the global economy and in the global financial markets. Furthermore, the 
market for products with the potential to treat diseases of aging, particularly those affecting large populations in a wide range of geographic locations, may 
be particularly vulnerable to unfavorable economic conditions. A global financial crisis or a global or regional political disruption, including most recently 
as a result of the COVID-19 pandemic, have caused and could continue to cause extreme volatility in the capital and credit markets. A severe or prolonged 
economic downturn or political disruption could result in a variety of risks to our business, including weakened demand for our current drug candidates or 
any future drug candidates, if approved, and our ability to raise additional capital when needed on acceptable terms, if at all. A weak or declining economy 
or  political  disruption  could  also  strain  our  manufacturers  or  suppliers,  possibly  resulting  in  supply  disruption,  or  cause  our  customers  to  delay  making 
payments  for  our  services.  Weakened  or  declining  economic  conditions  could  be  caused  by  a  number  of  factors,  including  high  interest  rates,  rising 
inflation,  the  government  closure  of  Silicon  Valley  Bank  and  liquidity  concerns  at  other  financial  institutions,  and  the  potential  for  local  and/or  global 
economic recession. Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the political or economic climate and 
financial market conditions could adversely impact our business.

We or the third parties upon whom we depend may be adversely affected by earthquakes, other natural disasters or unforeseen pandemics and public 
health emergencies, such as the COVID-19 pandemic, and our business continuity and disaster recovery plans may not adequately protect us from a 
serious disaster.

Our corporate headquarters and other facilities are located in the San Francisco Bay Area, which in the past has experienced both severe earthquakes and 
wildfires.  Although  we  carry  earthquake  insurance,  it  is  limited  in  scope.  Earthquakes,  wildfires  or  other  natural  disasters  could  severely  disrupt  our 
operations, and have a material adverse effect on our business, results of operations, financial condition and prospects.

If a natural disaster, power outage or other event occurred that prevented us from using all or a significant portion of our headquarters, that damaged critical 
infrastructure,  such  as  our  enterprise  financial  systems  or  manufacturing  resource  planning  and  enterprise  quality  systems,  or  that  otherwise  disrupted 
operations, it may be difficult or, in certain cases, impossible, for us to continue our business for a substantial period of time. The disaster recovery and 
business continuity plans we have in place currently are limited and are unlikely to prove adequate in the event of a serious disaster or similar event. We 
may  incur  substantial  expenses  as  a  result  of  the  limited  nature  of  our  disaster  recovery  and  business  continuity  plans,  which,  particularly  when  taken 
together with our lack of earthquake insurance, could have a material adverse effect on our business. Measures taken in response to a pandemic, such as the 
COVID-19  pandemic,  which  causes  a  public  health  emergency,  could  also  disrupt  our  operations,  and  have  a  material  adverse  effect  on  our  business,
results of operations, financial condition and prospects. For example, in mid-March 2020, in alignment with federal, state and local guidance designed to
slow the spread of COVID-19, we transitioned to a remote work plan and reduced onsite staffing model for all employees who could not perform their 
work from home, such as our laboratory, operations, and facilities staff. In the future, we may be required to take actions that could impact our operations if 
required by applicable laws or regulations or if we determine them to be in the best interests of our employees.

Furthermore, integral parties in our supply chain are similarly vulnerable to natural disasters or other sudden, unforeseen and severe adverse events. If such 
an event were to affect our supply chain, it could have a material adverse effect on our business.

Significant disruptions of information technology systems or deficiencies in our cybersecurity could materially adversely affect our business, results of 
operations and financial condition.

We collect and maintain information in digital form that is necessary to conduct our business, and we are increasingly dependent on information technology 
systems  and  infrastructure  to  operate  our  business.  In  the  ordinary  course  of  our  business,  we  collect,  store  and  transmit  large  amounts  of  confidential 
information, including intellectual property, proprietary business information and personal information. It is critical that we do so in a secure manner to 
maintain 

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the confidentiality and integrity of such confidential information. We have established physical, electronic and organizational measures to safeguard and 
secure our systems to prevent a data compromise, and rely on commercially available systems, software, tools, and monitoring to provide security for our 
information technology systems and the processing, transmission and storage of digital information. We have also outsourced elements of our information 
technology infrastructure, and as a result a number of third-party vendors may or could have access to our confidential information. 

Our information technology systems and infrastructure, and those of our current and any future collaborators, contractors and consultants and other third 
parties on which we rely, are vulnerable to attack, interruption and damage from computer viruses, malware (e.g. ransomware), natural disasters, terrorism, 
war, telecommunication and electrical failures, cyberattacks or cyber-intrusions over the Internet, phishing attacks and other social engineering schemes, 
employee  theft  or  misuse,  human  error,  fraud,  denial  or  degradation  of  service  attacks,  sophisticated  nation-state  and  nation-state-supported  actors  or 
unauthorized access or use by persons inside our organization, or persons with access to systems inside our organization.

The risk of a security breach or disruption, particularly through cyberattacks or cyber-intrusion, including by computer hackers, “phishing” attacks, foreign 
governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the 
world  have  increased.  In  addition,  the  prevalent  use  of  mobile  devices  that  access  confidential  information  increases  the  risk  of  data  security  breaches, 
which could lead to the loss of confidential information or other intellectual property. We may face increased cybersecurity risks due to our reliance on 
internet technology and the number of our employees that work or may work remotely, which may create additional opportunities for cybercriminals to 
exploit vulnerabilities. 

Furthermore, because the techniques used to obtain unauthorized access to, or to sabotage, systems change frequently and often are not recognized until 
launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures. We may also experience security 
breaches  that  may  remain  undetected  for  an  extended  period.  Even  if  identified,  we  may  be  unable  to  adequately  investigate  or  remediate  incidents  or 
breaches due to attackers increasingly using tools and techniques that are designed to circumvent controls, to avoid detection, and to remove or obfuscate 
forensic evidence.  The costs to us to mitigate network security problems, bugs, viruses, worms, malicious software programs and security vulnerabilities 
could  be  significant,  and  while  we  have  implemented  security  measures  to  protect  our  data  security  and  information  technology  systems,  our  efforts  to 
address these problems may not be successful, and these problems could result in unexpected interruptions, delays, cessation of service and other harm to 
our business and our competitive position. 

We  and  certain  of  our  service  providers  are  from  time  to  time  subject  to  cyberattacks  and  security  incidents.  While  we  do  not  believe  that  we  have 
experienced any significant system failure, accident or security breach to date, if such an event were to occur and cause interruptions in our operations, it 
could  result  in  a  material  disruption  of  our  product  development  programs.  For  example,  the  loss  of  clinical  study  data  from  completed  or  ongoing  or 
planned clinical studies could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data.

Moreover, if a security breach affects our systems, or those of our current and any future collaborators, contractors and consultants and other third parties 
on which we rely, or results in the unauthorized release of personally identifiable information, our reputation could be materially damaged. In addition, 
such a breach may require notification to governmental agencies, the media or individuals pursuant to various federal and state privacy and security laws. 
We would also be exposed to a risk of loss or litigation and potential liability, which could materially adversely affect our business, results of operations 
and  financial  condition.  We maintain  cyber  liability  insurance;  however,  this  insurance  may  not  be  sufficient  to  cover  the  financial,  legal,  business  or 
reputational losses that may result from an interruption or breach of our systems.

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Our  employees  and  independent  contractors,  including  principal  investigators,  consultants,  commercial  collaborators,  service  providers  and  other 
vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could 
have an adverse effect on our results of operations.

We  are  exposed  to  the  risk  that  our  employees  and  independent  contractors,  including  principal  investigators,  consultants,  any  future  commercial 
collaborators, service providers and other vendors may engage in misconduct or other illegal activity. Misconduct by these parties could include intentional, 
reckless  and/or  negligent  conduct  or  other  unauthorized  activities  that  violate  the  laws  and  regulations  of  the  FDA  and  other  similar  regulatory  bodies, 
including those laws that require the reporting of true, complete and accurate information to such regulatory bodies; manufacturing standards; U.S. federal 
and state healthcare fraud and abuse, data privacy laws and other similar non-U.S. laws; or laws that require the true, complete and accurate reporting of 
financial information or data. Activities subject to these laws also involve the improper use or misrepresentation of information obtained in the course of 
clinical studies, the creation of fraudulent data in our preclinical studies or clinical studies, or illegal misappropriation of product, which could result in
regulatory  sanctions  and  cause  serious  harm  to  our  reputation.  It  is  not  always  possible  to  identify  and  deter  misconduct  by  employees  and  other  third-
parties,  and  the  precautions  we  take  to  detect  and  prevent  this  activity  may  not  be  effective  in  controlling  unknown  or  unmanaged  risks  or  losses  or  in
protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. In
addition, we are subject to the risk that a person or government could allege such fraud or other misconduct, even if none occurred. If any such actions are 
instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business 
and  financial  results,  including,  without  limitation,  the  imposition  of  significant  civil,  criminal  and  administrative  penalties,  damages,  monetary  fines, 
disgorgements, possible exclusion from participation in Medicare, Medicaid and other U.S. healthcare programs, individual imprisonment, other sanctions,
contractual damages, reputational harm, diminished profits and future earnings and curtailment of our operations, any of which could adversely affect our 
ability to operate our business and our results of operations.

Our business involves the use of hazardous materials, and we and our third-party manufacturers and suppliers must comply with environmental laws 
and regulations, which can be expensive and restrict how we do business.

Our  research  and  development  activities  and  our  third-party  manufacturers’  and  suppliers’  activities  involve  the  controlled  storage,  use  and  disposal  of 
hazardous materials owned by us, including the components of our product and drug candidates and other hazardous compounds. We and any third-party 
manufacturers and suppliers we engage are subject to numerous federal, state and local environmental, health and safety laws, regulations and permitting 
requirements, including those governing laboratory procedures; the generation, handling, use, storage, treatment, and disposal of hazardous and regulated 
materials and wastes; the emission and discharge of hazardous materials into the ground, air and water; and employee health and safety. Our operations 
involve  the  use  of  hazardous  and  flammable  materials,  including  chemicals  and  biological  and  radioactive  materials.  Our  operations  also  produce 
hazardous waste. In some cases, these hazardous materials and various wastes resulting from their use are stored at our and our manufacturers’ facilities 
pending  their  use  and  disposal.  We  generally  contract  with  third  parties  for  the  disposal  of  these  materials  and  wastes.  We  cannot  eliminate  the  risk  of 
contamination,  which  could  cause  an  interruption  of  our  commercialization  efforts,  research  and  development  efforts  and  business  operations, 
environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling and disposal of 
these materials and specified waste products.

Although we believe that the safety procedures utilized by our third-party manufacturers for handling and disposing of these materials generally comply 
with the standards prescribed by these laws and regulations, we cannot guarantee that this is the case or eliminate the risk of accidental contamination or 
injury from these materials. Under certain environmental laws, we could be held responsible for costs relating to any contamination at our current or past 
facilities and at third-party facilities. In such an event, we may be held liable for any resulting damages and such liability could exceed our resources and 
state or federal or other applicable authorities may curtail our use of certain materials and/or interrupt our business operations. Furthermore, environmental 
laws and regulations are complex, change frequently and have tended to become more stringent. We cannot predict the impact of such changes and cannot 
be certain of our future compliance.

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Compliance with applicable environmental laws and regulations may be expensive, and current or future environmental laws and regulations may impair 
our research, product development and manufacturing efforts. In addition, we cannot entirely eliminate the risk of accidental injury or contamination from 
these materials or wastes. Although we maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to injuries to our 
employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. We do not carry 
specific biological or hazardous waste insurance coverage, and our property, casualty, and general liability insurance policies specifically exclude coverage 
for  damages  and  fines  arising  from  biological  or  hazardous  waste  exposure  or  contamination.  Accordingly,  in  the  event  of  contamination  or  injury,  we 
could be held liable for damages or be penalized with fines in an amount exceeding our resources, and our clinical studies or regulatory approvals could be 
suspended, which could have a material adverse effect on our business, results of operations and financial condition.

We may be subject to claims challenging the inventorship or ownership of our patents and other intellectual property.

We may also be subject to claims that former employees, collaborators or other third parties have an ownership interest in our patents or other intellectual 
property. Litigation may be necessary to defend against these and other claims challenging inventorship or ownership. If we fail in defending any such 
claims, in addition to paying monetary damages, we may lose valuable intellectual property rights. Such an outcome could have a material adverse effect 
on our business. Even if we are successful in defending against such claims, litigation could result in substantial costs and distraction to management and 
other employees.

We may not be able to protect our intellectual property rights throughout the world.

Filing, prosecuting and defending patents on drug candidates in all countries throughout the world would be prohibitively expensive, and our intellectual 
property  rights  in  some  countries  outside  the  United  States  can  be  less  extensive  than  those  in  the  United  States.  In  addition,  the  laws  of  some  foreign 
countries do not protect intellectual property rights to the same extent as federal and state laws in the United States. Consequently, we may not be able to 
prevent  third  parties  from  practicing  our  inventions  in  all  countries  outside  the  United  States,  or  from  selling  or  importing  products  made  using  our 
inventions in and into the United States or other jurisdictions. Competitors may use our technologies in jurisdictions where we have not obtained patent 
protection  to  develop  their  own  products  and  further,  may  export  otherwise  infringing  products  to  territories  where  we  have  patent  protection,  but 
enforcement is not as strong as that in the United States. These products may compete with our products and our patents or other intellectual property rights 
may not be effective or sufficient to prevent them from competing.

Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems 
of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection, particularly 
those relating to biopharmaceuticals, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in 
violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial costs and divert our 
efforts  and  attention  from  other  aspects  of  our  business,  could  put  our  patents  at  risk  of  being  invalidated  or  interpreted  narrowly  and  our  patent 
applications at risk of not issuing and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate, and the 
damages or other remedies awarded, if any, may not be commercially meaningful.

Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from 
the intellectual property that we develop or license.

Actual  or  perceived  failures  to  comply  with  U.S.  and  foreign  privacy  and  data  protection  laws,  regulations  and  standards  may  adversely  affect  our 
business, operations and financial performance.

We are subject to or affected by numerous federal, state and foreign laws and regulations, as well as regulatory guidance, governing the collection, use, 
disclosure, retention, and security of personal information, such as information that we collect about patients and healthcare providers in connection with 
clinical  trials  in  the  United  States  and  abroad.  The  global  data  protection  landscape  is  rapidly  evolving,  and  implementation  standards  and  enforcement 
practices are likely to remain uncertain for the foreseeable future. This evolution may create uncertainty 

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in  our  business,  affect  our  or  any  service  providers’,  contractors’  or  future  collaborators’  ability  to  operate  in  certain  jurisdictions  or  to  collect,  store, 
transfer use and share personal information, necessitate the acceptance of more onerous obligations in our contracts, result in liability or impose additional 
costs on us. The cost of compliance with these laws, regulations and standards is high and is likely to increase in the future. Any failure or perceived failure 
by us or our collaborators, service providers and contractors to comply with federal, state or foreign laws or regulation, our internal policies and procedures 
or our contracts governing processing of personal information could result in negative publicity, diversion of management time and effort and proceedings 
against us by governmental entities or others. In many jurisdictions, enforcement actions and consequences for noncompliance are rising.

In the United States, HIPAA imposes privacy, security and breach reporting obligations with respect to individually identifiable health information upon 
“covered  entities”  (health  plans,  health  care  clearinghouses  and  certain  health  care  providers),  and  their  respective  business  associates,  individuals  or 
entities that create, receive, maintain or transmit protected health information in connection with providing a service for or on behalf of a covered entity. 
Most healthcare providers, including research institutions from which we obtain patient health information, are subject to privacy and security regulations 
promulgated under HIPAA. While we do not believe that we are currently acting as a covered entity or business associate under HIPAA and thus are not 
directly  regulated  under  HIPAA,  any  person  may  be  prosecuted  under  HIPAA’s  criminal  provisions  either  directly  or  under  aiding-and-abetting  or 
conspiracy  principles.  Consequently,  depending  on  the  facts  and  circumstances,  we  could  face  substantial  criminal  penalties  if  we  knowingly  receive
individually identifiable health information from a HIPAA-covered healthcare provider or research institution that has not satisfied HIPAA’s requirements 
for disclosure of individually identifiable health information.

In addition, certain state laws govern the privacy and security of personal information, including health-related information For example, the California 
Consumer Privacy Act, or the CCPA went into effect on January 1, 2020. The CCPA gives California residents expanded rights to access and delete their 
personal information, opt out of certain personal information sharing, and receive detailed information about how their personal information is used. The 
CCPA provides for civil penalties for violations, as well as a private right of action for data breaches that has increased the likelihood, and risks associated 
with data breach litigation. Further, the California Privacy Rights Act, or the CPRA generally went into effect on January 1, 2023, and significantly amends 
the CCPA. It imposes additional data protection obligations on covered businesses, including additional consumer rights processes, limitations on data uses, 
new  audit  requirements  for  higher  risk  data,  and  opt  outs  for  certain  uses  of  sensitive  data.  It  also  creates  a  new  California  data  protection  agency 
authorized to issue substantive regulations and could result in increased privacy and information security enforcement. Additional compliance investment 
and  potential  business  process  changes  may  also  be  required.  Similar  laws  have  passed  in  Virginia,  Colorado,  Connecticut  and  Utah,  and  have  been 
proposed in other states and at the federal level, reflecting a trend toward more stringent privacy legislation in the United States. The enactment of such 
laws could have potentially conflicting requirements that would make compliance challenging. In the event that we are subject to or affected by HIPAA, the 
CCPA,  the  CPRA  or  other  domestic  privacy  and  data  protection  laws,  any  liability  from  failure  to  comply  with  the  requirements  of  these  laws  could 
adversely affect our financial condition.

Our  operations  abroad  may  also  be  subject  to  increased  scrutiny  or  attention  from  data  protection  authorities.  Many  countries  in  these  regions  have 
established or are in the process of establishing privacy and data security legal frameworks with which we, our collaborators, service providers, including 
our CRO, and contractors must comply. For example, the European Union General Data Protection Regulation, or GDPR, went into effect in May 2018 and 
imposes strict requirements for processing the personal information of subjects within the European Economic Area, or EEA, including clinical trial data. 
Companies  that  must  comply  with  the  GDPR  face  increased  compliance  obligations  and  risk,  including  more  robust  regulatory  enforcement  of  data 
protection requirements and potential fines for noncompliance of up to €20 million or 4% of the annual global revenues of the noncompliant company, 
whichever is greater. Among Further, recent legal developments in Europe have created complexity and compliance uncertainty regarding certain transfers 
of  personal  data  from  the  EEA.  On  July  16,  2020,  the  Court  of  Justice  of  the  European  Union,  or  the  CJEU,  invalidated  the  EU-U.S.  Privacy  Shield 
Framework, or the Privacy Shield, under which personal data could be transferred from the EEA to United States entities who had self-certified under the 
Privacy Shield scheme, and imposed further restrictions on use of the standard contractual clauses, or SCCs. In March 2022, the US and EU announced a 
new  regulatory  regime  intended  to  replace  the  invalidated  regulations;  however,  this  new  EU-US  Data  Privacy  Framework  has  not  been  implemented 
beyond  an  executive  order  signed  by  President  Biden  on  October  7,  2022  on  Enhancing  Safeguards  for  United  States  Signals  Intelligence  Activities. 
European court and 

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regulatory  decisions  subsequent  to  the  CJEU  decision  of  July  16,  2020  have  taken  a  restrictive  approach  to  international  data  transfers.  As  supervisory 
authorities  issue  further  guidance  on  personal  data  export  mechanisms,  including  circumstances  where  the  SCCs  cannot  be  used,  and/or  start  taking 
enforcement  action,  we  could  suffer  additional  costs,  complaints  and/or  regulatory  investigations  or  fines,  and/or  if  we  are  otherwise  unable  to  transfer 
personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical 
location or segregation of our relevant systems and operations, and could adversely affect our financial results.

Further, beginning January 1, 2021, companies have had to comply with the GDPR and also the United Kingdom GDPR, or UK GDPR, which, together
with the amended UK Data Protection Act 2018, retains the GDPR in United Kingdom national law. The UK GDPR mirrors the fines under the GDPR, i.e., 
fines up to the greater of €20 million (£17.5 million) or 4% of global turnover.  As we continue to expand into other foreign countries and jurisdictions, we 
may be subject to additional laws and regulations that may affect how we conduct business.

We incur increased costs as a result of operating as a public company, and our management devote substantial time to new compliance initiatives. We 
may  fail  to  comply  with  the  rules  that  apply  to  public  companies,  including  Section  404  of  the  Sarbanes-Oxley  Act  of  2002,  which  could  result  in 
sanctions or other penalties that would harm our business.

We have incurred and will continue to incur significant legal, accounting and other expenses as a public company, including costs resulting from public 
company reporting obligations under the Exchange Act and regulations regarding corporate governance practices. The listing requirements of the Nasdaq 
Global Select Market and the rules of the Securities and Exchange Commission, or SEC, require that we satisfy certain corporate governance requirements 
relating to director independence, filing annual and interim reports, stockholder meetings, approvals and voting, soliciting proxies, conflicts of interest and 
a code of conduct. Our management and other personnel have devoted and will need to devote a substantial amount of time to ensure that we comply with 
all of these requirements. Moreover, the reporting requirements, rules and regulations will increase our legal and financial compliance costs and will make 
some activities more time-consuming and costlier. Any changes we make to comply with these obligations may not be sufficient to allow us to satisfy our 
obligations  as  a  public  company  on  a  timely  basis,  or  at  all.  These  reporting  requirements,  rules  and  regulations,  coupled  with  the  increase  in  potential 
litigation exposure associated with being a public company, could also make it more difficult for us to attract and retain qualified persons to serve on our 
board of directors or board committees or to serve as executive officers, or to obtain certain types of insurance, including directors’ and officers’ insurance, 
on acceptable terms.

We  are  subject  to  Section  404  of  The  Sarbanes-Oxley  Act  of  2002,  or  Section  404,  and  the  related  rules  of  the  SEC,  which  generally  require  our 
management and independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting. Section 404 
requires  an  annual  management  assessment  of  the  effectiveness  of  our  internal  control  over  financial  reporting.  However,  for  so  long  as  we  remain  an 
emerging growth company as defined in the JOBS Act, we intend to take advantage of certain exemptions from various reporting requirements that are 
applicable  to  public  companies  that  are  not  emerging  growth  companies,  including,  but  not  limited  to,  not  being  required  to  comply  with  the  auditor 
attestation requirements of Section 404. Once we are no longer an emerging growth company or, if prior to such date, we opt to no longer take advantage of 
the applicable exemption, we will be required to include an opinion from our independent registered public accounting firm on the effectiveness of our 
internal controls over financial reporting.

During  the  course  of  our  review  of  our  internal  controls  we  may  identify  deficiencies  in  our  internal  controls  that  we  must  remediate.  If  we  identify  a 
material  weakness  in  our  internal  controls  over  financial  reporting,  we  may  not  detect  errors  on  a  timely  basis  and  our  financial  statements  may  be 
materially  misstated.  We  or  our  independent  registered  public  accounting  firm  may  not  be  able  to  conclude  on  an  ongoing  basis  that  we  have  effective 
internal control over financial reporting, which could harm our operating results, cause investors to lose confidence in our reported financial information 
and cause the trading price of our stock to fall. In addition, as a public company we will be required to file accurate and timely quarterly and annual reports 
with the SEC under the Exchange Act. In order to report our results of operations and financial statements on an accurate and timely basis, we will depend 
in part on CROs to provide timely and accurate notice of their costs to us. Any failure to report our financial results on an accurate and timely basis could 
result in sanctions, lawsuits, delisting of our shares from The Nasdaq Global Select Market or other adverse consequences that would materially harm to 
our business.

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We  are  an  “emerging  growth  company”  and  as  a  result  of  the  reduced  disclosure  and  governance  requirements  applicable  to  emerging  growth 
companies, our common stock may be less attractive to investors.

We  are  an  “emerging  growth  company,”  as  defined  in  the  JOBS  Act,  and  we  intend  to  take  advantage  of  certain  exemptions  from  various  reporting 
requirements  that  are  applicable  to  other  public  companies  that  are  not  emerging  growth  companies  including,  but  not  limited  to,  not  being  required  to 
comply with the auditor attestation requirements of Section 404, reduced disclosure obligations regarding executive compensation in our periodic reports 
and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval 
of any golden parachute payments not previously approved. In addition, as an “emerging growth company” the JOBS Act allows us to delay adoption of 
new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We have 
elected to use this extended transition period under the JOBS Act. As a result, our financial statements may not be comparable to the financial statements of 
issuers who are required to comply with the effective dates for new or revised accounting standards that are applicable to public companies, which may 
make comparison of our financials to those of other public companies more difficult.

We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find our common 
stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. We may take 
advantage  of  these  reporting  exemptions  until  we  are  no  longer  an  emerging  growth  company.  Even  after  we  no  longer  qualify  as  an  emerging  growth 
company, we may still qualify as a “smaller reporting company” which may allow us to take advantage of many of the same exemptions from disclosure 
requirements including not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act. We will remain 
an emerging growth company until the earlier of (1) the last day of the year following the fifth anniversary of the consummation of our IPO, (2) the last day 
of  the  year  in  which  we  have  total  annual  gross  revenue  of  at  least  $1.235  billion,  (3)  the  last  day  of  the  year  in  which  we  are  deemed  to  be  a  “large 
accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock held by non-affiliates 
exceeded $700.0 million as of the last business day of the second fiscal quarter of such year or (4) the date on which we have issued more than $1.0 billion 
in  non-convertible  debt  securities  during  the  prior  three-year  period.  We  expect  that  we  will  no  longer  qualify  as  an  emerging  growth  company  after 
December 31, 2023, at which time we will become subject to certain disclosure and compliance requirements as discussed herein that apply to other public 
companies but that did not previously, or currently, apply to us due to our status as an emerging growth company.

Item 1B. Unresolved Staff Comments. 

None.

Item 2. Properties. 

Our  corporate  headquarters  are  located  in  South  San  Francisco,  California,  where  we  currently  lease  approximately  62,000  square  feet  of  office  and 
laboratory space pursuant to a lease dated February 28, 2019, of which approximately 23,000 square feet was subleased as of June 2021 through August 
2024  and  approximately  15,000  square  feet  was  subleased  as  of  July  2022  through  June  2024.  The  majority  of  our  employees  work  at  our  corporate 
headquarters.

Item 3. Legal Proceedings. 

We are not currently a party to any material litigation or other material legal proceedings.

Item 4. Mine Safety Disclosures.

Not applicable.

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Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. 

Market Information for Common Stock

PART II

Our common stock has been listed on the Nasdaq Global Select Market under the symbol “UBX” since May 3, 2018. As of March 1, 2023, there were 52 
holders of record of our common stock. Because many of our shares of common stock are held by brokers and other institutions on behalf of stockholders, 
we are unable to estimate the total number of beneficial owners of our common stock represented by these record holders.

Dividend Policy

We have never declared or paid any cash dividends on our common stock or any other securities. We anticipate that we will retain all available funds and 
any future earnings, if any, for use in the operation of our business and do not anticipate paying cash dividends in the foreseeable future. In addition, future 
debt  instruments  may  materially  restrict  our  ability  to  pay  dividends  on  our  common  stock.  Payment  of  future  cash  dividends,  if  any,  will  be  at  the 
discretion of the board of directors after taking into account various factors, including our financial condition, operating results, current and anticipated 
cash needs, the requirements of current or then-existing debt instruments and other factors the board of directors deems relevant.

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Performance Graph

This graph is not “soliciting material” or deemed “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to liabilities 
under that Section, and shall not be deemed incorporated by reference into any filing of Unity Biotechnology, Inc. under the Securities Act of 1933, as
amended (the “Securities Act”), whether made before or after the date hereof and irrespective of any general incorporation language in any such filing. 

The following graph compares the cumulative total return on our common stock relative to the cumulative total returns of the Nasdaq Composite Index and 
the Nasdaq Biotechnology Index. Pursuant to applicable Securities and Exchange Commission rules, all values assume reinvestment of the full amount of 
all dividends, however no dividends have been declared on our common stock to date. The stockholder returns shown on the graph below are based on 
historical results and are not necessarily indicative of future performance, and we do not make or endorse any predictions as to future stockholder returns.

Sales of Unregistered Securities

There were no sales of unregistered securities during the year ended December 31, 2022.

Repurchase of Shares or of Company Equity Securities

None.

Item 6. [Reserved] 

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. 

You  should  read  the  following  discussion  and  analysis  of  our  financial  condition  and  results  of  operations  together  with  the  section  entitled  “Selected 
Financial Data” and our audited financial statements and related notes included elsewhere in this report. This discussion and other parts of this report 
contain  forward-looking  statements  that  involve  risks  and  uncertainties,  such  as  our  plans,  objectives,  expectations,  intentions  and  beliefs.  Our  actual 
results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, 
but are not limited to, those identified below and those discussed in the section entitled “Risk Factors” included elsewhere in this report. 

Overview

We are a biotechnology company engaged in researching and developing therapeutics to slow, halt, or reverse diseases of aging. Our initial focus 

is on creating senolytic medicines to selectively eliminate senescent cells and thereby treat diseases of aging, such as ophthalmologic diseases.

 In July 2020, we filed an Investigational New Drug application, or IND, to commence a Phase 1, first-in-human, open-label, single-ascending 
dose study of UBX1325 in patients with advanced diabetic macular edema, or DME, and neovascular age-related macular degeneration, or nAMD. Our 
goal with UBX1325 is to transformationally improve outcomes for patients with DME, nAMD, and diabetic retinopathy, or DR. In October 2020, the Phase 
1, first-in-human, clinical study of UBX1325 commenced. That study, an open-label, single ascending dose clinical trial, evaluated doses from 0.5 – 10 µg 
administered as a single intra-vitreal injection in up to 8 patients with DME and 11 patients with nAMD all of whom had been off all anti-VEGF treatment 
due to lack of benefit for at least 6 months. The results of this study demonstrated acceptable safety and tolerability without any dose-limiting toxicities; no 
evidence of intraocular inflammation; and mean improvement in BCVA of up to 9.5 ETDRS letters in those patients with DME receiving higher doses (5 
and 10 µg) and a mean improvement in BCVA of 3.2 ETDRS letters in evaluable patients with nAMD at all doses, both at 24 weeks after treatment with 
UBX1325.

 In May 2021, we initiated Phase 2 of the BEHOLD study and dosed our first patient in June 2021. This study is a multi-center, randomized, 
double-masked, sham- controlled study designed to evaluate the safety, tolerability, efficacy and durability of a single 10 µg dose of UBX1325 in patients 
with  DME  evaluated  though  24  weeks.  Patients  have  the  option  of  rolling  over  to  a  48-week  long  term  extension  and  a  majority  of  patients  who  have 
completed their 24-week visits have opted to remain in the study. A total of 65 patients were enrolled, randomized evenly between UBX1325 and sham-
injected patients. These patients were being actively treated with anti-VEGF for at least 6 months prior to being randomized into the BEHOLD study (mean 
of 4.03 injections in the 6 months preceding randomization), and had persistent visual acuity deficits (73 ETDRS letters or worse, approximately 20/40 or 
worse,  mean  of  61.4  letters  at  baseline)  and  residual  retinal  fluid  (≥300  µm  of  central  subfield  thickness  on  optical  coherence  tomography,  mean  of 
approximately 439.6 µm). At the time of randomization, patients were taken off of their anti-VEGF treatment, and instead treated with UBX1325 or a sham 
procedure. Endpoints being explored in the study include safety and tolerability, changes in BCVA, CST, SRF/IRF, proportion of patients requiring rescue 
treatment, and durability of effects.

In August  2022, we announced positive 12- and 18-week data in our Phase 2 BEHOLD study of UBX1325 in patients with DME, including that 
a single injection of UBX1325 led to a progressive, statistically significant, and clinically meaningful improvement in mean best-corrected visual acuity 
compared to sham treatment. At Week 18, the mean change from baseline of BCVA for UBX1325-treated subjects was an increase of 6.1 ETDRS letters 
that represents a difference of +5.0 ETDRS letters compared to sham-treated subjects (p=0.0368). In addition, patients treated with UBX1325 maintained 
central subfield thickness (CST) (+3.2 microns) compared to sham-treated patients who had progressive worsening (increase) in CST through 18 weeks 
(+53.5 microns) (p=0.0719). 

In November 2022, we announced positive 24-week data in our BEHOLD study, showing that a single injection of UBX1325 led to a statistically 
significant and clinically meaningful improvement in BCVA of +6.2 ETDRS letters from baseline and +7.6 ETDRS letters compared to sham treatment 
(p=0.0084). Inclusive of rescue data, patients treated with UBX1325 had a mean improvement in BCVA of +6.4 ETDRS letters from baseline and +5.2 
ETDRS letters compared to sham (p=0.0068). At 24 weeks, patients treated with UBX1325 had a mean change 

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in CST of -5.4 microns from baseline compared to a worsening (increase) of +34.6 microns in sham-treated patients (p=0.1244). The proportion of rescue-
free patients at 24 weeks was greater on UBX1325 (59.4%) as compared to sham (37.5%) with fewer total rescues and longer time-to-rescue in UBX1325-
treated patients as compared to sham. UBX1325 demonstrated a favorable safety and tolerability profile with no cases of intraocular inflammation, retinal 
artery occlusion, endophthalmitis, or vasculitis. Patients will continue to be followed through 48 weeks post-treatment in a long-term follow-up, with data 
expected in the second quarter of 2023.

In March 2022, we enrolled our first patient in Phase 2 of the ENVISION study. As of September 2022, the study has completed enrollment of 
patients with nAMD who have had at least two intravitreal injections of anti-VEGF therapy in the preceding six months and who still have active choroidal 
neovascularization  and  residual  sub-  or  intra-retinal  fluid.  Patients  will  have  received  their  last  anti-VEGF  treatment  approximately  4-8  weeks  prior  to 
screening, and all patients will be followed for approximately 24 weeks after dosing with either UBX1325 or aflibercept. We expect to announce both 16-
week and 24-week data from this Phase 2 proof-of-concept study in nAMD in late March 2023. In addition, we amended the Phase 2 ENVISION study 
including a Part B portion of the study to explore the benefit of a second cycle of two doses of UBX1325 treatment 4 weeks apart, administered at Weeks 
24 and 28 and the potential benefit of combination treatment with anti-VEGF therapy at Weeks 24 and 32 with all patients followed through Week 48. Data 
from Part B of the 48-week extension study is expected in the third quarter of 2023.

In February 2022, we announced a restructuring to align resources to focus on our ongoing clinical programs and deliver on key development 
milestones. These actions to prioritize our ophthalmology programs and implement cost saving measures were designed to enable us to achieve multiple 
key clinical data readouts for UBX1325 as well as support the Tie2 and Tie2/VEGF bispecific program through advanced candidate nomination, with all 
other pipeline programs paused to focus resources on these advanced programs.

Since  the  commencement  of  our  operations,  we  have  invested  a  significant  portion  of  our  efforts  and  financial  resources  in  research  and 
development activities, and we have incurred net losses each year since inception. Our net losses were $59.9 million and $60.7 million for the years ended 
December  31,  2022  and  2021,  respectively.  We  do  not  have  any  products  approved  for  sale,  and  we  have  never  generated  any  product  revenue.  As  of 
December 31, 2022, we had an accumulated deficit of $460.0 million, and we do not expect positive cash flows from operations in the foreseeable future. 

Substantially all of our net losses have resulted from costs incurred in connection with our research and development programs and from general 
and  administrative  costs  associated  with  our  operations.  Based  on  our  current  operating  plans,  we  expect  our  existing  capital  resources  will  fund  our 
planned operating expenses into the first quarter of 2024, which is expected to fund key clinical data readouts for UBX1325. Our capital resources will 
fund operations less than 12 months from the date of this Annual Report, as a result we concluded that this circumstance raises substantial doubt about our 
ability to continue as a going concern. We will need to raise additional capital; however, adequate funding may not be available to us on acceptable terms, 
or at all, particularly in light of the current economic uncertainty, high interest rates, rising inflation, the government closure of Silicon Valley Bank and 
liquidity  concerns  at  other  financial  institutions,  and  the  potential  for  local  and/or  global  economic  recession.  We  expect  to  continue  to  look  for 
opportunities to secure such financing in the near future, in addition to using our existing 2022 ATM Offering Programs (as defined below). If sufficient 
funds on acceptable terms are not available when needed, we could be required to significantly reduce our operating expenses and delay, reduce the scope 
of, or eliminate one or more of our development programs.

We  expect  to  continue  to  incur  net  operating  losses  for  at  least  the  next  several  years  as  we  continue  our  research  and  development  efforts, 
advance  our  drug  candidates  through  preclinical  and  clinical  development,  seek  regulatory  approval,  prepare  for  and,  if  approved,  proceed  to 
commercialization. We do not expect to generate revenue from any drug candidates that we develop until we obtain regulatory approval for one or more of 
such drug candidates and commercialize our products or enter into collaborative agreements with third parties.

We rely on third parties in the conduct of our preclinical studies and clinical trials and for manufacturing and supply of our drug candidates. We 
have no internal manufacturing capabilities, and we will continue to rely on third parties, many of whom are single-source suppliers, for our preclinical and 
clinical trial materials, as well as the commercial supply of our products. In addition, we do not yet have a marketing or sales organization or commercial 

83

 
infrastructure. Accordingly, we will incur significant expenses to develop a marketing and sales organization and commercial infrastructure in advance of 
generating any product sales.

COVID-19 Update

The  COVID-19  pandemic  has  placed  strains  on  the  providers  of  healthcare  services,  including  the  healthcare  institutions,  clinical  research 
organizations, or CROs, and Institutional Review Boards under whose auspices we conduct our clinical trials. These strains have resulted in limits on the 
initiation of new clinical trials, slowing or halting enrollment in existing trials and restrictions placed upon on-site monitoring activities of clinical trials. 
Prior to the initiation of our Phase 1 and Phase 2 studies of UBX1325, we amended the clinical study protocols to enable remote data collection for clinical 
sites  that  were  limited  in  their  ability  to  conduct  study  visits  in  person,  for  either  site  or  patient  safety  reasons.  We  also  instituted  remote  data  source 
verification procedures to limit the extent that on-site monitoring was required.

Although we rely on third party manufacturers to supply UBX1325, there have been no disruptions in our supply chain of drug manufacturers 
necessary to conduct our Phase 1 and Phase 2 studies of UBX1325, and we believe we have sufficient supply of drug inventories to complete our current 
studies in ophthalmologic disease. 

Reverse Stock Split

On October 18, 2022, at a special meeting of stockholders, or the Special Meeting, our stockholders approved a proposal authorizing our board 
of directors, in its discretion, to effect a reverse stock split of our outstanding shares of common stock at a ratio ranging from 1-for-6 to 1-for-12 to be 
determined by the board of directors in its discretion following the Special Meeting and prior to the Company’s annual meeting of stockholders to be held 
in  2023.  On  October  19,  2022,  our  board  of  directors  approved  a  1-for-10  reverse  stock  split  of  our  outstanding  common  stock.  A  Certificate  of 
Amendment to the Amended and Restated Certificate of Incorporation effecting the reverse stock split was filed with the Secretary of State of the State of 
Delaware on October 19, 2022 and the reverse stock split became effective at 5:00 p.m., Eastern Time, on October 19, 2022. At the effective time, every 10 
shares  of  common  stock  issued  and  outstanding  was  automatically  reclassified  into  one  new  share  common  stock  without  any  action  on  the  part  of  the 
holders.  No  fractional  shares  of  common  stock  were  issued  in  the  reverse  stock  split,  but  in  lieu  thereof,  each  holder  of  common  stock  who  would 
otherwise have been entitled to a fraction of a share in the reverse stock split received a cash payment. Proportionate adjustments were made to the exercise 
prices and the number of shares underlying the Company’s outstanding equity awards, as applicable, and warrants exercisable for shares of common stock, 
as well as to the number of shares issuable under the Company’s equity incentive plans and certain existing agreements. The common stock issued pursuant 
to the reverse stock split remain fully paid and non-assessable. The reverse stock split affected all stockholders of our common stock uniformly, and did not 
affect any stockholder’s percentage of ownership interest. Unless otherwise noted, all share and per share information included in this Annual Report on 
Form 10-K has been adjusted to give effect to the reverse stock split.

The reverse stock split did not affect the number of authorized shares of common stock or the par value of our common stock.

Components of Our Results of Operations 

Research and Development Expenses

Research and development expenses consist primarily of costs incurred for the development of our drug candidates, which include: 

personnel-related expenses, including salaries, benefits, severance, and stock-based compensation for personnel contributing to research and 
development activities;

laboratory expenses including supplies and services;

clinical trial expenses;

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•

•

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•

•

•

expenses  incurred  under  agreements  with  third-party  contract  manufacturing  organizations,  contract  research  organizations,  research  and 
development service providers, academic research institutions, and consultants;

expenses related to license and sponsored research agreements; and 

facilities and other allocated expenses, including expenses for rent and facilities maintenance, and depreciation and amortization. 

We expect our research and development expenses to increase as we advance our drug candidates into and through preclinical and clinical trials 
and pursue regulatory approval of our drug candidates. The process of conducting the clinical trials required to obtain regulatory approval is costly and 
time-consuming. Clinical trials generally become larger and more costly to conduct as they advance into later stages and we are required to make estimates 
for  expense  accruals  related  to  clinical  trial  expenses.  The  actual  probability  of  success  for  our  drug  candidates  may  be  affected  by  a  variety  of  factors 
including:  the  safety  and  efficacy  of  our  drug  candidates,  early  clinical  data,  investment  in  our  clinical  program,  the  ability  of  collaborators,  if  any,  to 
successfully develop any drug candidates we license to them, competition, manufacturing capability and commercial viability. We may never succeed in 
achieving regulatory approval for any of our drug candidates. Program costs that are direct external expenses are tracked on a program-by-program basis 
once  they  enter  clinical  studies.  As  a  result  of  the  uncertainties  discussed  above,  we  are  unable  to  determine  the  duration  and  completion  costs  of  our 
research and development projects or when and to what extent we will generate revenue from the commercialization and sale of our drug candidates.

General and Administrative Expenses

Our  general  and  administrative  expenses  consist  primarily  of  personnel  costs,  allocated  facilities  costs  and  other  expenses  for  outside 
professional  services,  including  legal,  audit  and  accounting  services,  and  depreciation  and  amortization  expense  related  to  property  and  equipment. 
Personnel costs consist of salaries, benefits, severance, and stock-based compensation. We expect to continue to incur additional expenses associated with 
operating as a public company, including expenses related to compliance with the rules and regulations of the Securities and Exchange Commission and 
standards  applicable  to  companies  listed  on  a  national  securities  exchange,  additional  insurance  expenses,  investor  relations  activities,  and  other 
administrative and professional services. 

Change Fair Value of Contingent Consideration

Certain  of  our  license  agreements  include  contingent  consideration  in  the  form  of  additional  issuances  of  our  common  stock  based  on  the 
achievement of certain milestones. For asset acquisitions, we assess whether such contingent consideration obligation meets the definition of a derivative 
and/or can be equity classified, until such time that the contingency or equity classification criteria is met or expires. We have recorded a liability related to 
contingent consideration as the net settlement criteria of the definition of a derivative had been met and equity classification criteria had not been met. The 
derivative  related  to  this  contingent  consideration  was  measured  at  fair  value  as  of  each  balance  sheet  date  with  the  related  change  in  fair  value  being 
reflected in operating results. Gains or losses on contingent consideration expense is driven by changes in the estimated fair value of the liability, which is 
determined using a probability-weighted valuation approach model that reflects the probability and timing of future issuances of our common shares.

Interest Income 

Interest income is primarily related to interest earned on our marketable securities.  

Interest Expense

Interest expense relates to interest on the Loan Agreement entered into on August 3, 2020.

85

 
Other Income (Expense), Net 

We held an equity investment in an entity called Ascentage Pharma Group International, or Ascentage International, an affiliate of a Hong Kong 
based clinical-stage biopharmaceutical company called Ascentage Pharma Group Corp. Limited. In October 2019, Ascentage International completed an 
initial public offering of shares of its common stock on the Hong Kong Stock Exchange. Following the initial public offering, the underlying nature of our 
investment in Ascentage International changed and met the definition of an investment in an equity security with a readily determinable fair value to be 
measured at fair value on a recurring basis, based on quoted stock prices available on the Hong Kong Stock Exchange. During the year ended December 
31, 2020, we sold our entire equity investment in Ascentage International. Other income (expense) in 2020 includes the recognized losses resulting from 
the  sale  of  the  investment  in  this  equity  security  and  the  previous  changes  in  fair  value,  while  other  expense  in  2021  includes  the  commitment  share 
expenses related to the equity purchase agreement with Lincoln Park Capital Fund and the debt extinguishment gain from the conversion of debt to equity. 
Other income during the year ended December 31, 2022 includes the recognized gains resulting from the extinguishment of the derivative related to long 
term debt offset by property and other tax expense. 

Results of Operations

Comparison of the Years Ended December 31, 2022 and 2021

The following table sets forth the significant components of our results of operations (in thousands):

Summary of Operations Data:
Licensing revenue – related party
Operating expenses:

Research and development
General and administrative

Total operating expenses
Loss from operations
Interest income
Interest expense
Other income (expense), net
Net loss

Year ended December 31,
2021
2022

Change

  $

236  

  $

4,784     $

(4,548 )

36,859    
20,949    
57,808    
(57,572 )  
1,220    
(3,558 )  
(17 )  
(59,927 )   $

38,393      
23,056      
61,449      
(56,665 )    
100      
(3,177 )    
(983 )    
(60,725 )   $

(1,534 )
(2,107 )
(3,641 )
(907 )
1,120  
(381 )
966  
798  

  $

Licensing Revenue – Related Party

In December 2021, we entered into a licensing agreement with Jocasta Neuroscience, Inc. (“Jocasta”) pursuant to which we exclusively licensed 
all of our rights to UBX2089, our α-Klotho asset. The agreement provided for an upfront fee of $5.0 million. We recognized revenue of $0.2 million and 
$4.8  million  for  the  years  ended  December  31,  2022  and  2021,  respectively,  related  to  the  grant  of  license  and  delivery  of  the  know-how  performance 
obligation under the License Agreement entered into with Jocasta in December 2021.

Research and Development

Research and development expenses decreased by $1.5 million, to $36.9 million for the year ended December 31, 2022 from $38.4 million for 
the year ended December 31, 2021. The decrease was primarily due to decreases of $3.3 million in facilities-related costs primarily due to allocation to 
general and administrative expenses of net expenses on Brisbane and East Grand facilities which have been subleased, $2.6 million in personnel costs due 
to our reduced headcount and reduction in force, and $1.8 million in laboratory supplies, partially offset by an increase of 

86

 
 
 
 
   
 
 
 
 
 
 
   
 
 
     
     
   
 
     
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$6.2 million in direct research and development expenses mainly due to the continued advancement of our lead UBX1325 candidates. 

General and Administrative

General and administrative expenses decreased by $2.1 million, to $21.0 million for the year ended December 31, 2022 from $23.1 million for 
the year ended December 31, 2021. The decrease was primarily due to decreases of  $1.4 million in personnel costs due to our reduced headcount and 
reduction in force, $0.4 million in professional fees, and $0.3 million in facilities-related costs.

Interest Income 

Our interest income was $1.2 million for the year ended December 31, 2022, as compared to $0.1 million for the year ended December 31, 2021.

The increase is primarily attributable to higher market yields and increased cash balances on our cash equivalents and marketable securities.

Interest Expense

Our  interest  expense  of  $3.5  million  and  $3.2  million  for  the  years  ended  December  31,  2022  and  2021,  respectively,  is  related  to  the  Loan 

Agreement.

Other Income (Expense), Net

Other income, net, was immaterial for the year ended December 31, 2022 which includes the $0.2 million in recognized gains resulting from the 
extinguishment of the derivative related to long term debt and $0.1 million from the gains on sale of assets, offset by $0.3 million property and other tax 
expense. Other expense, net, was $1.0 million for the year ended December 31, 2021 which includes $0.8 million commitment share expenses related to the 
equity purchase agreement with Lincoln Park Capital Fund and $0.3 million property and other tax expense, partially offset by $0.2 million gain from the 
extinguishment of the derivative related to long term debt and the sale of assets. 

Comparison of the years ended December 31, 2021 and 2020

The following table sets forth the significant components of our results of operations (in thousands): 

Summary of Operations Data:
Licensing revenue – related party
Operating expenses:

Research and development
General and administrative
Change in fair value of contingent consideration
Impairment of long-lived assets

Total operating expenses
Loss from operations
Interest income
Interest expense
Other income (expense), net
Net loss

Year ended December 31,
2020
2021

Change

  $

4,784     $

—     $

4,784  

38,393    
23,056    
—    
—    
61,449    
(56,665 )  
100    
(3,177 )  
(983 )  
(60,725 )   $

67,309      
24,025      
(33 )    
2,629      
93,930      
(93,930 )    
1,196      
(1,292 )    
182      
(93,844 )   $

(28,916 )
(969 )
33  
(2,629 )
(32,481 )
37,265  
(1,096 )
(1,885 )
(1,165 )
33,119  

  $

Licensing Revenue – Related Party

In December 2021, we entered into a licensing agreement with Jocasta Neuroscience, Inc. (“Jocasta”) pursuant to which we exclusively licensed 

all of our rights to UBX2089, our α-Klotho asset. The agreement provided 

87

 
 
 
 
 
 
   
 
 
 
 
 
 
   
 
 
     
     
   
 
     
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
for an upfront fee of $5.0 million. Revenue recognized in the year ended December 31, 2021 was related to grant of license and delivery of the know-how 
performance obligation under the License Agreement. We recognized revenue of $4.8 million and zero for the years ended December 31, 2021 and 2020. 

Research and Development

Research and development expenses decreased by $28.9 million, to $38.4 million for the year ended December 31, 2021 from $67.3 million for 
the year ended December 31, 2020. The decrease was primarily due to  decreases of $11.9 million in direct research and development expenses mainly due 
to termination of osteoarthritis studies and decreased safety studies, $10.2 million in personnel costs due to reduction in force, $3.8 million in facilities-
related  costs  primarily  due  to  allocation  to  general  and  administrative  expenses  of  net  expenses  on  Brisbane  and  East  Grand  facilities  which  have  been 
subleased, $2.5 million in laboratory supplies and $0.5 million in consultant expenses. 

General and Administrative

General and administrative expenses decreased by $1.0 million, to $23.0 million for the year ended December 31, 2021 from $24.0 million for 
the  year  ended  December  31,  2020.  The  decrease  was  primarily  due  to  decreases  of  $0.8  million  in  professional  fees,  $0.3  million  in  personnel-related 
expenses and $0.1 million in facilities-related costs, offset by $0.2 million increase in insurance-related expense.

Change in Fair Value of Contingent Consideration

There  was  no  contingent  consideration  liability  at  December  31,  2021  and  2020.  The  change  in  fair  value  of  contingent  consideration  was 

immaterial for the year ended December 31, 2020, and was primarily due to changes in our stock price.  

Impairment of Long-Lived Assets

Impairment charges consisted of impairment of long-lived assets. There were no impairment charges during the year ended December 31, 2021. 
During the year ended December 31, 2020, we recorded an impairment charge of $2.6 million after evaluating the right-of-use asset and related leasehold 
improvements upon exit of our former headquarters located in Brisbane, California. 

Interest Income 

Our interest income was $0.1 million for the year ended December 31, 2021, as compared to $1.2 million for the year ended December 31, 2020.

The decrease is primarily attributable to lower market yields and cash balances on the Company’s cash equivalents and marketable securities.

Interest Expense

Our  interest  expense  of  $3.2  million  and  $1.3  million  for  the  years  ended  December  31,  2021  and  2020,  respectively,  is  related  to  the  Loan 

Agreement.

Other Income (Expense), Net

Other expense, net, was $1.0 million for the year ended December 31, 2021 which includes $0.8 million commitment share expenses related to 
the equity purchase agreement with Lincoln Park Capital Fund and $0.3 million property and other tax expense, offset by $0.2 million gain from the debt 
extinguishment from the conversion of debt to equity and the sale of assets. Other income, net, was $0.2 million for the year ended December 31, 2020 and 
was primarily due to the change in the fair value of our investment in the common stock of Ascentage International. The entire investment was sold in 
2020.

88

 
  
  
  
  
  
  
  
Liquidity, Capital Resources and Capital Requirements

Sources of Liquidity

We have incurred net losses each year since inception. We do not have any products approved for sale and have never generated any revenue 
from  product  sales.  Historically,  we  have  incurred  operating  losses  as  a  result  of  ongoing  efforts  to  develop  our  drug  candidates,  including  conducting 
ongoing research and development, preclinical studies and providing general and administrative support for these operations. Our net losses were $59.9 
million and $60.7 million for the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, we had an accumulated deficit of 
$460.0 million, and we do not expect positive cash flows from operations in the foreseeable future. Based on our current operating plans, we expect our 
existing capital resources will fund our planned operating expenses into the first quarter of 2024, which is expected to fund key clinical data readouts for 
UBX1325, but is less than 12 months from the date of this Annual Report. These conditions raise substantial doubt about our ability to continue as a going 
concern.  Additionally,  our  independent  registered  public  accounting  firm  has  included  in  its  audit  opinion  for  the  year  ended  December  31,  2022  an 
explanatory paragraph that there is substantial doubt as to our ability to continue as a going concern. We expect our operating losses and net cash used in 
operating activities will increase over at least the next several years as we continue our research and development activities, advance our drug candidates 
through  preclinical  and  clinical  testing  and  move  into  later  and  more  costly  stages  of  drug  development,  hire  personnel  and  prepare  for  regulatory 
submissions  and  the  commercialization  of  our  drug  candidates.  As  a  result,  we  will  need  to  raise  additional  capital  to  finance  its  operations.  Adequate 
funding  may  not  be  available  to  us  on  acceptable  terms,  or  at  all,  particularly  in  light  of  the  economic  uncertainty,  liquidity  concerns  at  financial 
institutions, and potential for local and/or global economic recession. Further, if banks and financial institutions enter receivership or become insolvent in 
the future in response to financial conditions affecting the banking system and financial markets, our ability to access our existing cash, cash equivalents 
and investments may be threatened, which could have a material adverse effect on our business and financial condition. 

Further,  based  on  our  public  float,  as  of  the  date  of  the  filing  of  this  Annual  Report  on  Form  10-K,  we  are  only  permitted  to  utilize  a  shelf 
registration statement, including the registration statements under which our ATM Offering Programs are operated, subject to Instruction I.B.6 to Form S-3, 
which is referred to as the “baby shelf” rule. For so long as our public float is less than $75.0 million, we may not sell more than the equivalent of one-third 
of our public float during any 12 consecutive months pursuant to the baby shelf rules. Although alternative public and private transaction structures may be 
available, these may require additional time and cost, may impose operational restrictions on us, and may not be available on attractive terms. If sufficient 
funds on acceptable terms are not available when needed, we could be required to significantly reduce our operating expenses and delay, reduce the scope 
of,  or  eliminate  one  or  more  of  our  development  programs.  Failure  to  manage  discretionary  spending  or  raise  additional  financing,  as  needed,  may 
adversely impact our ability to achieve our intended business objectives because without substantial additional capital, we may not be able to complete 
pivotal trials necessary to advance our product development and our programs.

We  have  historically  financed  our  operations  primarily  through  private  placements  of  preferred  stock  and  promissory  notes,  as  well  as  public 
equity issuances, such as our initial public offering, and more recently through proceeds from our Loan Agreement, our prior and existing at-the-market 
offering programs, the Equity Purchase Agreement, and the sale of common stock and warrants in the Follow-On Offering (each as defined below) and we 
will  continue  to  be  dependent  upon  equity  and/or  debt  financing  to  operate  our  business  until  we  are  able  to  generate  positive  cash  flows  from  our 
operations.

In August 2020, we entered into a Loan Agreement with Hercules Capital, Inc. (“Hercules”) pursuant to a term loan, subject to certain terms and 
conditions  and  $25.0  million  was  advanced  to  us  on  the  date  of  execution  of  the  Loan  Agreement.  In  August  2022,  we  met  certain  clinical  and  capital 
raising milestones, which extended the interest only period to March 2023. On January 25, 2023, we entered into a second amendment to the Loan and 
Security  Agreement  with  Hercules  Capital,  Inc.  whereas  the  amortization  date  was  extended  from  March  1,  2023  to  April  1,  2023.  As  such,  we  will 
continue to make interest only payments up to the amended amortization date and then we will be required to repay the principal balance and interest in 
equal monthly installments through August 1, 2024. In December 2021, we entered into an amendment to our Loan and Security Agreement under the 
terms of which, Hercules (including any of its assignees) has the option for a period of six (6) months to convert up to $5.0 million of the outstanding 
principal under the existing loan into shares of our common stock. Under the Loan Amendment, the 

89

 
required cash reserve amount shall be reduced by the principal amount of the converted loan to not less than $10 million. As of December 31, 2022, we had 
issued 435,497 shares of our common stock reducing our outstanding loan principal balance by $5.0 million and reducing the required cash reserve to $10 
million.  In  addition,  the  interest  only  period  may  extend  an  additional  three  months  to  June  1,  2023  should  we  meet  specific  milestones  related  to  our 
clinical  trials  and  raising  additional  capital  by  April  1,  2023.  There  have  been  no  material  adverse  events  in  connection  with  the  Loan  Agreement  with 
Hercules and the substantial doubt regarding our ability to continue as a going concern does not currently constitute a material adverse event under the 
terms of the Loan Agreement. 

In  March  2022,  we  filed  the  March  2022  Shelf  Registration  Statement  and  entered  into  the  March  2022  Sales  Agreement,  as  amended,  with 
Cowen as sales agent to sell shares of our common stock, from time to time, with aggregate gross sales proceeds of up to $25.0 million pursuant to the 
March 2022 Shelf Registration Statement as an “at-the-market” offering under the Securities Act. Cowen is entitled to up to 3.0% of the gross proceeds of 
any shares of common stock sold under the March 2022 Sales Agreement. During the year ended December 31, 2022, there were 786,544 shares of the 
Company's common stock sold pursuant to the March 2022 Sales Agreement and the Company's received total net proceeds of approximately $9.1 million, 
after deducting commissions and other offering expenses of $0.3 million.

On August 22, 2022, we closed an underwritten offering, or the Follow-On Offering, in which the Company issued and sold an aggregate of 
6,428,571 shares of common stock together with warrants, or the Warrants, to purchase an up to aggregate of 6,428,572 shares of common stock at an 
offering price of $7.00 per unit. The Warrants have an exercise price of $8.50 per share underlying the Warrant. The net proceeds to us were approximately 
$41.7 million.

In October 2022, we filed the October 2022 Shelf Registration Statement and also entered into the October 2022 Sales Agreement with Cowen as 
sales agent to sell shares of our common stock, from time to time, with aggregate gross sales proceeds of up to $50.0 million pursuant to the October 2022 
Shelf Registration Statement as an “at-the-market” offering under the Securities Act. Cowen is entitled to up to 3.0% of the gross proceeds of any shares of 
common stock sold under the October 2022 Sales Agreement. There were no shares sold under the October 2022 ATM Offering Program during the year 
ended December 31, 2022.

In September 2021, we entered into a Purchase Agreement with Lincoln Park Capital Fund, LLC, under which we may at our discretion, sell up 
to  $30.0  million  shares  of  our  common  stock  over  a  36-month  period,  subject  to  certain  daily  limits,  applicable  prices,  and  conditions.  During  the  first 
quarter  of  2022,  we  had  initiated  the  purchase  of  0.1  million  shares  of  our  common  stock  amounting  to  $0.9  million  in  gross  proceeds.  There  were  no 
purchases  initiated  in  the  remaining  three  quarters  of  2022.  Issuances  under  the  Purchase  Agreement  were  to  be  made  pursuant  to  the  Company’s 
Registration  Statement  filed  in  July  2019,  which  has  since  expired.  The  Company  would  need  to  file  a  new  prospectus  supplement  covering  issuances 
under the Purchase Agreement in order to continue using the facility.

Future Funding Requirements

To date we have not generated any product revenue. We expect to continue to incur significant losses for the foreseeable future, and we expect 
the losses to increase as we continue the development of, and seek regulatory approvals for, our drug candidates, and begin to commercialize any approved
products.  We  are  subject  to  all  of  the  risks  typically  related  to  the  development  of  new  drug  candidates,  and  we  may  encounter  unforeseen  expenses, 
difficulties,  complications,  delays,  and  other  unknown  factors  that  may  adversely  affect  our  business.  Moreover,  since  becoming  a  public  company,  we 
continue to incur additional ongoing costs associated with operating as a public company. We anticipate that we will need substantial additional funding in 
connection with our continuing operations.  

Until we can generate a sufficient amount of revenue from the commercialization of our drug candidates or from collaborative agreements with 
third parties, if ever, we expect to finance our future cash needs through various means. We do not have any committed external source of funds. Additional 
capital may be raised through the sale of our equity securities through our ATM Offering programs or otherwise, incurring debt, entering into licensing or 
collaboration  agreements  with  partners,  receiving  research  contributions,  grants  or  other  sources  of  financing  to  fund  our  operations.  There  can  be  no 
assurance that sufficient funds will be available to us on attractive terms or at all. If we are unable to obtain additional funding from these or other sources, 
it may be necessary to significantly reduce our 

90

 
  
  
 
rate of spending through reductions in staff and delaying, scaling back, or stopping certain research and development programs. Insufficient liquidity may 
also require us to relinquish rights to drug candidates at an earlier stage of development or on less favorable terms than we would otherwise choose.

Based on our current operating plans, we expect our existing capital resources will fund our planned operating expenses into the first quarter of
2024, which is expected to fund key clinical data readouts for UBX1325. We have based our projections of operating capital requirements on assumptions 
that may prove to be incorrect and we may use all our available capital resources sooner than we expect. Because of the numerous risks and uncertainties 
associated  with  research,  development,  and  commercialization  of  biotechnology  products,  we  are  unable  to  estimate  the  exact  amount  of  our  operating 
capital requirements. Our future funding requirements will depend on many factors, including, but not limited to:

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

the results of our ongoing clinical trials of UBX1325;

our ability to reduce our operating expenses;

the  scope,  progress,  results  and  costs  of  researching  and  developing  our  drug  candidates,  and  conducting  preclinical  studies  and  clinical 
studies;

potential delays in or an increase in costs associated with our ongoing or planned preclinical studies or clinical trials;

the timing of, and the costs involved in, obtaining regulatory approvals for our current drug candidates or any future drug candidates;

the number and characteristics of any additional drug candidates we develop or acquire;

the timing and amount of any milestone payments we are required to make pursuant to our license agreements;

the cost of manufacturing our current drug candidates or any future drug candidates and any products we successfully commercialize;

the  cost  of  commercialization  activities  if  our  current  drug  candidates  or  any  future  drug  candidates  are  approved  for  sale,  including 
marketing, sales and distribution costs;

our ability to maintain existing, and establish new, strategic collaborations, licensing or other arrangements and the financial terms of any 
such agreements, including the timing and amount of any future milestone, royalty or other payments due under any such agreement;

any product liability or other lawsuits related to our products;

the costs associated with being a public company;

the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing our intellectual property portfolio; and

our ability to utilize our ATM Offering Programs and raise additional capital;

the availability of capital in the technology and life sciences industries following the government closure of Silicon Valley Bank and liquidity 
concerns at other financial institutions;

whether or not we can maintain compliance with the continued listing requirements of Nasdaq; and

91

 
•

the timing, receipt and amount of sales of any future approved products, if any.

Cash Flows

The following table sets forth a summary of the primary sources and uses of cash and restricted cash for each of the periods presented below (in 

thousands):

Cash used in operating activities
Cash provided by (used in) investing activities
Cash provided by financing activities
Net increase (decrease) in cash and
   restricted cash

Operating Activities

2022

Year ended December 31,
2021

2020

  $

(51,029 )   $
(24,545 )    
54,855      

(45,060 )   $
39,313      
20,845      

(78,333 )
(5,208 )
63,875  

  $

(20,719 )   $

15,098     $

(19,666 )

Cash  used  in  operating  activities  of  $51.0  million  for  the  year  ended  December  31,  2022  consisted  primarily  of  a  net  loss  of  $59.9  million 
adjusted for net non-cash charges of $9.9 million and net changes to our operating assets and liabilities of $1.0 million. Our non-cash charges consisted 
primarily of $9.4 million in stock-based compensation, $2.2 million in depreciation and amortization, and $1.3 million in amortization of debt issuance 
costs, partially offset by a $2.2 million in non-cash rent expense, $0.3 million in net accretion and amortization of premium and discounts on marketable 
securities, $0.3 million gain from disposal of property and equipment and $0.2 million gain from the extinguishment of the derivative related to long term 
debt. The net change in our operating assets and liabilities primarily consisted of decreases of $1.0 million in accrued compensation, and $0.2 million in 
accounts payable, partially offset by decreases of $0.1 million in prepaid expenses and other current assets and $0.1 million in other long-term assets. 

Cash  used  in  operating  activities  of  $45.1  million  for  the  year  ended  December  31,  2021  consisted  primarily  of  a  net  loss  of  $60.7  million 
adjusted for net non-cash charges of $16.3 million and net changes to our operating assets and liabilities of $0.6 million. Our non-cash charges consisted 
primarily of $11.6 million in stock-based compensation, $2.9 million in depreciation and amortization, $1.5 million in common stock granted to a third 
party, $1.0 million in net accretion and amortization of premium and discounts on marketable securities, $0.8 million in amortization of debt issuance costs 
and $0.8 million other expenses related to the equity purchase agreement with Lincoln Park Capital Fund, partially offset by a $2.2 million in non-cash rent 
expense and $0.1 million gain from the extinguishment of the derivative related to long term debt. The net change in our operating assets and liabilities 
primarily consisted of decreases of $1.3 million in accrued compensation, $1.1 million in accrued liabilities and other current liabilities, $0.6 million in 
accounts  payable  and  an  increase  of  $0.1  million  in  other  long-term  assets,  partially  offset  by  increases  of  $1.0  million  in  derivative  liability  and  $0.2 
million in deferred revenue and a decrease of $1.3 million in prepaid expenses and other current assets. 

Cash  used  in  operating  activities  of  $78.3  million  for  the  year  ended  December  31,  2020  consisted  primarily  of  a  net  loss  of  $93.8  million 
adjusted for net non-cash charges of $20.1 million and net changes to our operating assets and liabilities of $4.6 million. Our non-cash charges consisted 
primarily of $13.8 million in stock-based compensation, $3.4 million in depreciation and amortization, $2.6 million in impairment charges pertaining to 
leasehold improvements and right of use assets in the Company’s former offices, $1.2 million in common stock granted to a third party, $0.3 million in 
amortization of debt issuance costs and $0.3 million in net accretion and amortization of premium and discounts on marketable securities, partially offset 
by  a  $1.1  million  in  non-cash  rent  expense  and  $0.5  million  change  in  fair  value  of  strategic  investment.  The  net  change  in  our  operating  assets  and 
liabilities consisted of decreases of $2.6 million in accounts payable, $0.9 million in accrued liabilities and other current liabilities, $0.5 million in accrued 
compensation and increase of $1.2 million in prepaid expenses and other current assets, partially offset by a decrease of $0.6 million in other long-term 
assets. 

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Investing Activities

Cash used in investing activities of $24.5 million for the year ended December 31, 2022 was related to   purchases of marketable securities of 
$98.8  million  and  property  and  equipment  of  $0.1  million,  partially  offset  by  maturities  of  marketable  securities  of  $74.0  million  and  the  sale  of  $0.4 
million of property and equipment.

Cash provided by investing activities of $39.3 million for the year ended December 31, 2021 was related to maturities of marketable securities of 

$121.0 million which were offset by purchases of marketable securities of $81.5 million and purchases of property and equipment of $0.2 million.

Cash  used  in  investing  activities  of  $5.2  million  for  the  year  ended  December  31,  2020  was  related  to  purchases  of  marketable  securities  of 
$138.5 million and purchases of property and equipment of $0.6 million, which were offset by maturities of marketable securities of $127.9 million and the 
sale of our strategic investment of $6.0 million.

Financing Activities

Cash  provided  by  financing  activities  of  $54.9  million  for  the  year  ended  December  31,  2022  was  related  to  $41.7  million  in  proceeds  from 
issuance of common stock and warrants from our Follow-On Offering, net of issuance costs, $12.2 million in proceeds from the sale of common stock 
through our ATM Offering Program, net of issuance costs, $0.9 million in proceeds from issuance of common stock to Lincoln Park Capital Fund, net of 
issuance costs, and $0.1 million in proceeds from the issuance of common stock under the 2018 Employee Stock Purchase Plan.

Cash provided by financing activities of $20.8 million for the year ended December 31, 2021 was related to $10.4 million in proceeds from the 
sale of common stock through our ATM Offering Program, net of issuance costs, $8.2 million in proceeds from issuance of common stock to Lincoln Park 
Capital  Fund,  net  of  issuance  costs,  $1.8  million  in  proceeds  from  issuance  of  common  stock  upon  exercise  of  stock  options,  net  of  repurchases,  $0.3 
million in proceeds from the issuance of common stock under the 2018 Employee Stock Purchase Plan and $0.2 million in proceeds from the repayment of 
employee promissory note, partially offset by $0.1 million current portion of long-term debt arrangement.

Cash provided by financing activities of $63.9 million for the year ended December 31, 2020 was related to $37.3 million in proceeds from the 
sale of common stock through our ATM Offering Program, net of issuance costs, $24.2 million in proceeds from long-term debt, net of issuance costs, $1.5 
million  in  proceeds  from  issuance  of  common  stock  upon  exercise  of  stock  options,  net  of  repurchases,  $0.6  million  in  proceeds  from  the  issuance  of 
common stock under the 2018 Employee Stock Purchase Plan, and $0.4 million in proceeds from the repayment of promissory notes from an employee.

Contractual Obligations and Other Commitments 

Our contractual obligations and commitments relate primarily to our Loan Agreement, operating leases and non-cancelable purchase obligations 
under agreements with various research and development organizations and suppliers in the ordinary course of business. See Note 7, “Commitments and 
Contingencies” and Note 8, “Term Loan Facility,” to our financial statements for further information. 

We  are  party  to  various  license  agreements  pursuant  to  which  we  have  in-licensed  rights  to  various  technologies,  including  patents,  research 
“know-how”  and  proprietary  research  tools,  for  the  discovery,  research,  development  and  commercialization  of  drug  candidates  to  treat  age-related 
diseases. The license agreements obligate us to make certain milestone payments related to specified clinical development and sales milestone events, as 
well as tiered royalties in the low-single digits based on sales of licensed products. See Note 5 to our financial statements “License Revenue, Agreements 
and Strategic Investment” for additional information. 

Indemnification

In the normal course of business, we enter into contracts and agreements that contain a variety of representations and warranties and provide for 

general indemnifications. Our exposure under these agreements is 

93

 
unknown because it involves claims that may be made against us in the future but have not yet been made. To date, we have not paid any claims or been 
required to defend any action related to our indemnification obligations. However, we may record charges in the future as a result of these indemnification 
obligations.

In accordance with our certificate of incorporation and bylaws, we have potential indemnification obligations to our officers and directors for 
specified events or occurrences, subject to some limits, while they are serving at our request in such capacities. There have been no claims to date, and we 
have director and officer insurance that may enable us to recover a portion of any amounts paid for future potential claims.

Off-Balance Sheet Arrangements

We have not entered into any off-balance sheet arrangements. 

Critical Accounting Policies and Estimates 

This discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared 
in accordance with accounting principles generally accepted in the United States (“GAAP”). The preparation of these financial statements requires us to 
make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of 
the financial statements, as well as the reported expenses incurred during the reporting periods. These items are monitored and analyzed by us for changes 
in facts and circumstances, and material changes in these estimates could occur in the future. Our estimates are based on our historical experience and on 
various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying 
value of assets and liabilities that are not readily apparent from other sources. Changes in estimates are reflected in reported results for the period in which 
they become known. Actual results may differ from these estimates under different assumptions or conditions. 

While  our  significant  accounting  policies  are  described  in  more  detail  in  the  notes  to  our  financial  statements  included  elsewhere  in  this 
prospectus, we believe that the following accounting policies are critical to understanding our historical and future performance, as these policies relate to 
the more significant areas involving management’s judgments and estimates. 

Research and Development Expenses and Accruals 

Costs  related  to  research  and  development  of  drug  candidates  are  charged  to  research  and  development  expense  as  incurred.  Research  and 
development  costs  include,  but  are  not  limited  to,  payroll  and  personnel  expenses  for  personnel  contributing  to  research  and  development  activities, 
laboratory supplies, outside services, licenses acquired to be used in research and development, manufacturing of clinical material, pre-clinical testing and 
consultants and allocated overhead, including rent, equipment, depreciation and utilities. Research and development costs are expensed as incurred unless 
there is an alternative future use in other research and development projects. Payments made prior to the receipt of goods or services to be used in research 
and development are deferred and recognized as expense in the period in which the related goods are received or services are rendered. Such payments are 
evaluated for current or long-term classification based on when they will be realized.

As part of the process of preparing our financial statements, we are required to estimate expenses resulting from our obligations under contracts 
with vendors and consultants and clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to 
negotiations  which  vary  from  contract  to  contract  and  may  result  in  payment  flows  that  do  not  match  the  periods  over  which  materials  or  services  are 
provided under such contracts. Our objective is to reflect the appropriate expenses in our financial statements by matching those expenses with the period 
in which services and efforts are expended. We account for these expenses according to the progress of the production of clinical trial materials or based on 
progression of the clinical trial, as measured by patient progression and the timing of various aspects of the trial. We determine accrual estimates by taking 
into account discussion with applicable personnel and outside service providers as to the progress or state of consummation of goods and services, or the 
services  completed.  During  the  course  of  a  clinical  trial,  we  adjust  the  rate  of  expense  recognition  if  actual  results  differ  from  our  estimates.  We  make 
estimates  of  accrued  expenses  as  of  each  balance  sheet  date  in  our  financial  statements  based  on  the  facts  and  circumstances  known  at  that  time.  Our 
clinical trial accrual is dependent in part upon the timely and accurate reporting of contract research organizations, contract manufacturers and other third-
party vendors. Although we do not expect our estimates to be materially different from amounts 

94

 
actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary 
and may result in our reporting changes in estimates in any particular period. Adjustments to prior period estimates have not been material for the years 
ended December 31, 2022 and 2021.

We have and may continue to enter into license agreements to access and utilize certain technology. We evaluate if the license agreement is an 
acquisition of an asset or a business. To date none of our license agreements have been considered to be an acquisition of a business. For asset acquisitions, 
the  upfront  payments  to  acquire  such  licenses,  as  well  as  any  future  milestone  payments  made  before  product  approval,  are  immediately  recognized  as 
research and development expense when due, provided there is no alternative future use of the rights in other research and development projects. These 
license agreements may also include contingent consideration in the form of cash and additional issuances of our common stock. 

Stock-Based Compensation 

We recognize compensation costs related to stock-based awards granted based on the estimated fair value of the awards on the date of grant, and 
we recognize forfeitures as they occur. For awards that vest solely based on service conditions or a combination of service and performance conditions, we 
estimate the grant date fair value, and the resulting stock-based compensation expense, using the Black-Scholes option-pricing model. The grant date fair 
value of the awards is generally recognized on a straight-line basis over the requisite service period, which is typically their vesting period. We recognize 
forfeitures as they occur. 

The  market  traded  price  of  the  shares  of  common  stock  underlying  the  stock-based  awards  is  the  fair  value  of  our  stock  as  reported  on  the

Nasdaq Global Select Market on the grant date.

The Black-Scholes option-pricing model requires the use of highly subjective assumptions to determine the fair value of stock-based awards. 

These assumptions include: 

•

•

•

•

Expected  term—The  expected  term  represents  the  period  that  the  stock-based  awards  are  expected  to  be  outstanding.  We  use,  due  to 
insufficient historical data, the simplified method to determine the expected term, which is based on the average of the time-to-vesting and 
the contractual life of the options. 

Expected  volatility—Due  to  our  limited  trading  history  for  our  common  stock,  the  expected  volatility  is  estimated  based  on  the  average 
historical volatilities of common stock of comparable publicly traded entities over a period equal to the expected term of the stock option 
grants.  The  comparable  companies  are  chosen  based  on  their  size,  stage  in  the  product  development  cycle  or  area  of  specialty.  We  will 
continue  to  apply  this  process  until  a  sufficient  amount  of  historical  information  regarding  the  volatility  of  our  own  stock  price  becomes 
available. 

Risk-free  interest  rate—The  risk-free  interest  rate  is  based  on  the  U.S.  Treasury  yield  in  effect  at  the  time  of  grant  for  zero-coupon  U.S. 
Treasury notes with maturities approximately equal to the expected term of the awards. 

Expected  dividend—We  have  never  paid  dividends  on  our  common  stock  and  have  no  plans  to  pay  dividends  on  our  common  stock. 
Therefore, we used an expected dividend yield of zero. 

We  have  also  granted  stock  options  to  certain  key  employees  that  vest  in  conjunction  with  certain  market  conditions.  The  Company  uses  the 
Monte-Carlo option-pricing model to estimate the fair value of stock option awards that contain only market conditions. The Monte-Carlo option pricing 
model uses similar input assumptions as the Black-Scholes model; however, it further incorporates into the fair-value determination the possibility that the 
market condition may not be satisfied.

As of December 31, 2022, we had $12.3 million of unrecognized compensation expense related to unvested stock options and restricted stock 
units, which is expected to be recognized over an estimated weighted-average period of 2.9 years. For stock-based awards subject to ratable vesting, we 
recognize compensation cost on a straight-line basis over the service period for the entire award. In future periods, our stock-based compensation expense 
is expected to increase as a result of recognizing our existing unrecognized stock-based compensation for awards that will vest and as we issue additional 
stock-based awards to attract and retain our employees.

95

 
JOBS Act Accounting Election 

We are an emerging growth company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or 
revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. We have 
irrevocably elected to avail ourselves of this exemption from new or revised accounting standards and, therefore, will not be subject to the same new or 
revised accounting standards as other public companies that are not emerging growth companies. We also rely on other exemptions provided by the JOBS 
Act, including, without limitation, providing an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 
404(b)  of  the  Sarbanes-Oxley  Act.  We  will  remain  an  emerging  growth  company  until  the  earlier  of  (1)  the  last  day  of  the  year  following  the  fifth 
anniversary of the consummation of our IPO, (2) the last day of the year in which we have total annual gross revenue of at least $1.235 billion, (3) the last 
day of the year in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market 
value of our common stock held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year or (4) the 
date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. Even after we no longer qualify 
as  an  emerging  growth  company,  we  may  still  qualify  as  a  “smaller  reporting  company”  which  may  allow  us  to  take  advantage  of  many  of  the  same 
exemptions  from  disclosure  requirements  including  not  being  required  to  comply  with  the  auditor  attestation  requirements  of  Section  404(b)  of  the 
Sarbanes-Oxley Act.

We expect that we will no longer qualify as an emerging growth company after December 31, 2023, at which time we will become subject to 
certain disclosure and compliance requirements as discussed herein that apply to other public companies but that did not previously, or currently, apply to 
us due to our status as an emerging growth company.

Recent Accounting Pronouncements 

See Note 2 to our Financial Statements “Summary of Significant Accounting Policies” for information. 

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

Cash, Cash Equivalents and Marketable Securities

We are exposed to market risks in the ordinary course of our business. These risks primarily relate to interest rate sensitivities. We had cash, cash 
equivalents, and marketable securities of $94.8 million as of December 31, 2022, which consist of bank deposits, money market funds, and marketable 
securities.  The  primary  objective  of  our  investment  activities  is  to  preserve  capital  to  fund  our  operations.  We  also  seek  to  maximize  income  from  our 
investments without assuming significant risk. Because our investments are primarily short-term in duration, we believe that our exposure to interest rate 
risk is not significant, and a 1% movement in market interest rates would not have a significant impact on the total value of our portfolio.

Interest Rate Risk

As of December 31, 2022, the outstanding principal amount of the term loan under the Hercules Loan Agreement was $20.0 million. The interest 
payments under our term loan may be subject to interest rate risk and our interest expense could increase if market interest rates increase. The interest on 
the term loan accrues at a per annum rate of the greater of (i) the Wall Street Journal prime rate plus 6.10% and (ii) 9.35%. Accordingly, increases in these 
published rates would increase our interest payments under the term loans.  The effective interest rate at December 31, 2022 was 19.87%. A hypothetical 
1%  change  in  interest  rates  would  increase  expense  by  approximately  $0.2  million  annually  and  would  not  have  a  material  impact  on  our  results  of 
operations.

96

 
Item 8. Financial Statements and Supplementary Data. 

UNITY BIOTECHNOLOGY, INC. 
Index to Financial Statements

Report of Independent Registered Public Accounting Firm (PCAOB ID 42)

Balance Sheets

Statements of Operations and Comprehensive Loss

Statements of Stockholders’ Equity

Statements of Cash Flows

Notes to the Financial Statements

97

Page

98

99

100

101

104

105

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of 
Unity Biotechnology, Inc. 

Opinion on the Financial Statements 
We have audited the accompanying balance sheets of Unity Biotechnology, Inc. (“the Company”) as of December 31, 2022 and 2021, the related 
statements of operations and comprehensive loss, stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2022, 
and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, 
the financial position of the Company at December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the 
period ended December 31, 2022, in conformity with U.S. generally accepted accounting principles.  

The Company's Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the 
financial statements, the Company has suffered recurring losses from operations, and has stated that substantial doubt exists about the Company’s ability to 
continue as a going concern. Management's evaluation of the events and conditions and management’s plans regarding these matters are also described in 
Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion 
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial 
statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) 
(PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and 
regulations of the Securities and Exchange Commission and the PCAOB. 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable 
assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor 
were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of 
internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over 
financial reporting. Accordingly, we express no such opinion. 

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and 
performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in 
the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as 
evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. 

/s/ Ernst & Young LLP 

We have served as the Company’s auditor since 2017. 
San Mateo, California 
March 15, 2023

98

 
 
 
 
 
 
UNITY BIOTECHNOLOGY, INC. 
Balance Sheets 
(in thousands, except for share amounts and par value) 

December 31,

2022

(1)

2021

Assets
Current assets:

Cash and cash equivalents
Short-term marketable securities
Prepaid expenses and other current assets
Restricted cash
Total current assets

Property and equipment, net
Operating lease right-of-use assets
Long-term marketable securities
Long-term restricted cash
Other long-term assets

Total assets

Liabilities and Stockholders’ Equity
Current liabilities:

Accounts payable
Accrued compensation
Accrued and other current liabilities
Deferred revenue
Derivative liability related to debt
Current portion of long-term debt

Total current liabilities
Operating lease liability, net of current portion
Long-term debt, net
Other long-term liabilities
Total liabilities
Commitments and contingencies (Note 7)
Stockholders’ equity:

Convertible preferred stock, $0.0001 par value; 10,000,000 shares
   authorized; no shares issued and outstanding
Common stock, $0.0001 par value; 300,000,000 shares
   authorized as of December 31, 2022 and 2021; 14,215,302 
   and 6,299,158 shares issued and outstanding as of 
   December 31, 2022 and 2021, respectively 
Additional paid-in capital
Accumulated other comprehensive gain
Accumulated deficit
Total stockholders’ equity
Total liabilities and stockholders’ equity

(2)

  $

  $

  $

  $

12,736     $
82,059    
1,740    
—    
96,535    
7,825    
19,042    
—    
896    
52    
124,350     $

1,790     $
3,020    
5,334    
—    
—    
9,476    
19,620    
26,991    
10,891    
—    
57,502    

32,905  
55,170  
1,879  
550  
90,504  
9,942  
21,286  
1,993  
896  
91  
124,712  

1,985  
4,028  
6,370  
216  
963  
3,055  
16,617  
30,094  
18,409  
23  
65,143  

—    

—  

1    
527,049    
(251 )  
(459,951 )  
66,848    
124,350     $

1  
459,636  
(44 )
(400,024 )
59,569  
124,712  

(1) The balance sheet as of December 31, 2021 (as adjusted for the Reverse Split, as defined in Note 2) is derived from the audited financial statements as of that date.
(2) The Company effected a reverse stock split of its outstanding shares of common stock on October 19, 2022 where every ten shares of its common stock issued and outstanding was converted 
into one share of common stock. Any fractional post-split shares as a result of the reverse split were rounded down to the nearest whole post-split share. Shareholders of the Company previously 
authorized the Board of Directors to approve a reverse stock split at the annual meeting on October 18, 2022. All share amounts and per share amounts disclosed in this Annual Report on Form 
10-K have been restated to reflect the reverse stock split on a retroactive basis in all periods presented.

See accompanying notes to the financial statements. 

99

 
 
 
 
 
 
 
 
 
 
 
     
   
 
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     
   
 
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     
   
 
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
UNITY BIOTECHNOLOGY, INC. 
Statements of Operations and Comprehensive Loss 
(in thousands, except share and per share amounts)

Licensing revenue – Related Party
Operating expenses:

Research and development
General and administrative
Change in fair value of contingent consideration
Impairment of long-lived assets

Total operating expenses
Loss from operations
Interest income
Interest expense
Other income (expense), net
Net loss

Other comprehensive loss

Unrealized loss on marketable debt securities

Comprehensive loss

Net loss per share, basic and diluted

Weighted average number of shares used in computing net loss
(1)
   per share, basic and diluted 

2022

Year ended December 31,
2021

2020

  $

236     $

4,784     $

—  

36,859    
20,949    
—    
—    
57,808    
(57,572 )  
1,220    
(3,558 )  
(17 )  
(59,927 )   $

(207 )  
(60,134 )   $
(6.31 )   $

38,393    
23,056    
—    
—    
61,449    
(56,665 )  
100    
(3,177 )  
(983 )  
(60,725 )   $

(49 )  
(60,774 )   $
(10.88 )   $

67,309  
24,025  
(33 )
2,629  
93,930  
(93,930 )
1,196  
(1,292 )
182  
(93,844 )

(85 )

(93,929 )

(18.45 )

9,494,421    

5,581,587    

5,086,489  

  $

  $
  $

(1)  The Company effected a reverse stock split of its outstanding shares of common stock on October 19, 2022 where every ten shares of its common stock issued and outstanding was converted 
into one share of common stock. Any fractional post-split shares as a result of the reverse split were rounded up to the nearest whole post-split share. Shareholders of the Company previously 
authorized the Board of Directors to approve a reverse stock split at the annual meeting on October 18, 2022. All share amounts and per share amounts disclosed in this Annual Report on Form 
10-K have been restated to reflect the reverse stock split on a retroactive basis in all periods presented.

See accompanying notes to the financial statements.

100

 
 
 
 
 
 
 
   
   
 
 
     
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     
     
   
 
 
 
 
 
 
 
 
 
 
 UNITY BIOTECHNOLOGY, INC. 
Statements of Stockholders’ Equity
(in thousands, except share amounts) 

101

 
 
Common Stock 

(1)

Shares

Amou
nt

Additional
Paid-In

Capital

Related Party
Promissory 
Notes
for Purchase 
of
Common 
Stock

Employee 
Promissory 
Notes for 
Purchase of
Common 
Stock

Accumulated
Other
Comprehensi
ve

Accumulated

Total
Stockholders’

    Gain (Loss)

Deficit

Equity

Balances at December 31, 2019

4,722,674  

 $

1  

 $

366,700  

 $

(210 )

 $

(418 )  $

90  

 $

(245,455 )  $

120,708  

Issuance of common stock, net of issuance costs, under
   ATM equity offering program
Issuance of common stock upon exercise of stock 
options
Issuance of common stock upon vesting of restricted
   stock units
Vesting of early exercised stock options
Stock-based compensation
Common stock issued for services
Common stock issued to third parties for milestone 
payments
Repayment of promissory note from employee from
   purchase of common stock
Repayment of promissory note from employee through
   repurchase of early exercise shares
Issuance of common stock under 2018 ESPP
Unrealized loss on available-for-sale marketable 
securities
Net loss

Balances at December 31, 2020

Issuance of common stock, net of issuance costs, under
   ATM equity offering program
Issuance of common stock to Lincoln Park Capital Fund,
   net of issuance costs
Issuance of common stock Hercules Capital,
   net of issuance costs
Issuance of common stock upon exercise of stock 
options
Issuance of common stock under 2018 ESPP
Common stock granted to third party
Repurchase of early exercised shares
Vesting of restricted stock units
Stock-based compensation
Repayment of promissory note for purchase of common
   stock
Unrealized loss on available-for-sale marketable 
securities
Net loss

Balances at December 31, 2021

500,226  

   —  

41,048  

   —  

10,302  
—  
—  
4,355  

   —  
   —  
   —  
   —  

36,164  

   —  

—  

   —  

(1,291 )
11,810  

   —  
   —  

—  
—  

5,325,288  

   —  
   —  
1  
 $

 $

189,453  

   —  

417,286  

   —  

172,736  

49,754  
11,704  
40,005  
(3,337 )
96,269  
—  

   —  
   —  
   —  
   —  
   —  
   —  

—  

   —  

—  
—  

6,299,158  

   —  
   —  
1  
 $

 $

37,270  

1,510  

—  
216  
13,746  
100  

2,310  

—  

(44 )
576  

—  
—  

—  

—  

—  
—  
—  
—  

—  

—  

—  
—  

—  
—  

—  

—  

—  
—  
—  
—  

—  

374  

44  
—  

—  
—  

422,384  

 $

(210 )

 $

—  

 $

10,357  

9,039  

2,704  

1,795  
347  
1,457  
—  
—  
11,553  

—  

—  
—  

459,636  

 $

102

—  

—  

—  

—  
—  
—  
—  
—  
—  

210  

—  
—  

—  

 $

—  

—  

—  

—  
—  
—  
—  
—  
—  

—  

—  
—  

—  

—  

—  

—  
—  
—  
—  

—  

—  

—  
—  

(85 )   
—  

5  

 $

—  

—  

—  

—  
—  
—  
—  
—  
—  

—  

(49 )   
—  
(44 )  $

 $

—  

—  

—  
—  
—  
—  

—  

—  

—  
—  

—  

(93,844 )   
(339,299 )  $

—  

—  

—  

—  
—  
—  
—  
—  
—  

—  

—  

(60,725 )   
(400,024 )  $

37,270  

1,510  

—  
216  
13,746  
100  

2,310  

374  

—  
576  

(85 )
(93,844 )

82,881  

10,357  

9,039  

2,704  

1,795  
347  
1,457  
—  
—  
11,553  

210  

(49 )
(60,725 )

59,569  

 
 
 
 
 
 
 
 
 
   
   
   
 
 
 
 
 
 
 
 
 
 
 
   
   
 
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
 
 
    
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
Issuance of common stock, net of issuance costs, under
   ATM equity offering program
Sale of common stock and warrants to purchase 
common shares 
   under follow-on offering, net of issuance costs
Issuance of common stock to Lincoln Park Capital 
Fund,
   net of issuance costs
Issuance of common stock Hercules Capital,
   net of issuance costs
Issuance of common stock under 2018 ESPP
Vesting of restricted stock units
Stock-based compensation
Unrealized loss on available-for-sale marketable 
securities
Net loss

1,019,046  

—  

12,155  

6,428,571  

—  

41,648  

90,000  

262,761  
25,482  
90,284  
—  

—  
—  

—  

—  
—  
—  
—  

—  
—  

1  

910  

3,179  
142  
—  
9,379  

—  
—  

 $

527,049  

 $

—  

—  

—  

—  
—  
—  
—  

—  
—  

—  

 $

—  

—  

—  

—  
—  
—  
—  

—  
—  

—  

—  

—  

—  

—  
—  
—  
—  

(207 )   
—  
(251 )  $

 $

—  

—  

—  

—  
—  
—  
—  

—  

(59,927 )   
(459,951 )  $

12,155  

41,648  

910  

3,179  
142  
—  
9,379  

(207 )
(59,927 )

66,848  

Balances at December 31, 2022

14,215,302  

 $

(1) The Company effected a reverse stock split of its outstanding shares of common stock on October 19, 2022 where every ten shares of its common stock issued and outstanding was converted 
into one share of common stock. Any fractional post-split shares as a result of the reverse split were rounded down to the nearest whole post-split share. Shareholders of the Company previously 
authorized the Board of Directors to approve a reverse stock split at the annual meeting on October 18, 2022. All share amounts and per share amounts disclosed in this Annual Report on Form 
10-K have been restated to reflect the reverse stock split on a retroactive basis in all periods presented.

See accompanying notes to the financial statements.

103

 
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
 
 
UNITY BIOTECHNOLOGY, INC. 
Statements of Cash Flows 
(in thousands) 

Operating activities
Net loss
Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization
Amortization of debt issuance costs
Debt extinguishment gain upon conversion to equity
Net accretion and amortization of premium and discounts on marketable securities
Other expense related to the commitment shares issued to Lincoln Park
   Capital Fund
Gain on disposal of property and equipment
Stock-based compensation
Common stock issued to third parties
Non-cash rent expense
Impairment of long-lived assets
Change in fair value of strategic investment
Change in fair value of contingent consideration
Changes in operating assets and liabilities:

Prepaid expenses and other current assets
Other long-term assets
Accounts payable
Accrued compensation
Accrued liabilities and other current liabilities
Other long-term liabilities
Derivative liability related to debt
Deferred revenue

Net cash used in operating activities
Investing activities
Purchase of marketable securities
Maturities of marketable securities
Sale of strategic investments
Sale of property and equipment
Purchase of property and equipment
Net cash provided by (used in) investing activities
Financing activities
Proceeds from issuance of common stock under ATM offering program, 
   net of issuance costs
Proceeds from sale of common stock and warrants under follow-on offering, 
   net of issuance costs
Proceeds from issuance of common stock to Lincoln Park Capital Fund, 
   net of issuance costs
Proceeds from repayment of employee promissory notes
Proceeds from long-term debt, net of issuance costs to lender
Payment of long-term debt non-lender issuance costs
Proceeds from issuance of common stock upon exercise of stock options,
   net of repurchases
Proceeds from issuance of common stock under the 2018 ESPP
Current portion of long-term debt arrangement
Payments made on capital lease obligations
Net cash provided by financing activities
Net increase (decrease) in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of year
Cash, cash equivalents and restricted cash at end of year

Supplemental Disclosures of Cash Flow Information:
Cash paid for interest

Supplemental Disclosures of Non-Cash Investing and Financing Activities
Issuance of common shares in payment of debt

Property and equipment included in accounts payable

Issuance of common stock in settlement of contingent consideration milestone

Issuance of shares in settlement of share-based liability

Right-of-use assets obtained in exchange for new operating lease liabilities

2022

Year ended December 31,
2021

2020

  $

(59,927 )   $

(60,725 )   $

(93,844 )

2,180  
1,318  
(199 )  
(276 )  

—  
(346 )  
9,379  
—  
(2,136 )  
—  
—  
—  

138  
39  
(194 )  
(1,008 )  
26  
(23 )  
—  
—  

(51,029 )  

(98,827 )  
74,000  
—  
378  
(96 )  
(24,545 )  

12,155  

41,648  

910  
—  
—  
—  

2,880  
813  
(123 )  
1,043  

825  
—  
11,553  
1,457  
(2,152 )  
—  
—  
—  

1,288  

(91 )  
(573 )  
(1,327 )  
(1,131 )  
24  
963  
216  
(45,060 )  

(81,492 )  
121,000  
—  
—  
(195 )  

39,313  

10,357  

—  

8,215  
210  
—  
—  

—  
142  
—  
—  
54,855  
(20,719 )  
34,351  
13,632  

  $

1,784  
347  
(68 )  
—  
20,845  
15,098  
19,253  
34,351  

  $

2,204  

  $

2,370  

  $

3,179  

—  

—  

—  

—  

  $
  $
  $
  $
  $

2,704  

—  

—  

—  

—  

  $
  $
  $
  $
  $

  $

  $

  $
  $
  $
  $
  $

3,449  
318  
—  
256  

—  
—  
13,813  
1,211  
(1,076 )
2,629  
(502 )
(33 )

(1,168 )
628  
(2,640 )
(517 )
(857 )
—  
—  
—  
(78,333 )

(138,486 )
127,915  
6,009  
—  
(646 )
(5,208 )

37,270  

—  

—  
374  
24,550  
(360 )

1,510  
576  
—  
(45 )
63,875  
(19,666 )
38,919  
19,253  

773  

—  

13  

1,098  

100  

27,714  

See accompanying notes to the financial statements. 

104

 
 
 
 
 
 
 
   
   
 
 
 
   
 
   
 
 
 
 
   
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
   
 
 
 
 
   
 
   
 
 
 
UNITY BIOTECHNOLOGY, INC.
NOTES TO THE FINANCIAL STATEMENTS 

1. Organization 

Description of Business 

Unity Biotechnology, Inc. (the “Company”) is a biotechnology company engaged in the research and development of therapeutics to slow, halt, or reverse 
diseases  of  aging.  The  Company  devotes  substantially  all  of  its  time  and  efforts  to  performing  research  and  development  and  raising  capital.  The 
Company’s headquarters are located in South San Francisco, California. The Company was incorporated in the State of Delaware in 2009.

Liquidity

The Company’s Financial Statements have been prepared on a going concern basis, which contemplates the continuity of operations, realization of assets 
and the satisfaction of liabilities and commitments in the ordinary course of business. The Company has incurred operating losses and has an accumulated 
deficit  as  a  result  of  ongoing  efforts  to  develop  drug  product  candidates,  including  conducting  preclinical  and  clinical  trials  and  providing  general  and 
administrative support for these operations. The Company had an accumulated deficit of $460.0 million as of December 31, 2022. During the year ended 
December  31,  2022,  the  Company  incurred  a  net  loss  of  $59.9  million  and  used  $51.0  million  of  cash  in  operating  activities.  To  date,  none  of  the 
Company’s drug candidates have been approved for sale, and therefore, the Company has not generated any product revenue and does not expect positive 
cash flows from operations in the foreseeable future. The Company has financed its operations primarily through private placements of preferred stock and 
promissory notes, public equity issuances, and more recently, from its ATM Offering Program (as defined in Note 10), the Term Loan Facility (as defined 
in Note 8), an Equity Purchase Agreement (as defined in Note 10), and the sale of common stock and warrants under a Follow-On Offering (as defined in 
Note  10),  and  will  continue  to  be  dependent  upon  equity  and/or  debt  financing  until  the  Company  is  able  to  generate  positive  cash  flows  from  its
operations.

The Company had cash, cash equivalents and marketable securities of $94.8 million as of December 31, 2022. The Company expects that its cash and cash 
equivalents as of December 31, 2022 will not be sufficient to fund its current business plan including related operating expenses and capital expenditure 
requirements  through  at  least  12  months  from  the  date  of  issuance  of  these  Financial  Statements.  These  conditions  raise  substantial  doubt  about  the 
Company’s  ability  to  continue  as  a  going  concern.  The  Company  plans  to  seek  to  address  this  condition  by  raising  additional  capital  to  finance  its 
operations. The future viability of the Company is dependent on its ability to raise additional capital to finance its operations. Although the Company has 
been  successful  in  raising  capital  in  the  past,  there  is  no  assurance  that  it  will  be  successful  in  obtaining  such  additional  financing.  Therefore,  it  is  not 
considered  probable  that  the  Company’s  plans  to  raise  additional  capital  will  alleviate  the  substantial  doubt  regarding  its  ability  to  continue  as  a  going
concern.

Management expects operating losses to continue for the foreseeable future. As a result, the Company will need to raise additional capital. If sufficient 
funds on acceptable terms are not available when needed, the Company could be required to significantly reduce its operating expenses and delay, reduce 
the scope of, or eliminate one or more of its development programs. Failure to manage discretionary spending or raise additional financing, as needed, may 
adversely impact the Company’s ability to achieve its intended business objectives. 

2. Summary of Significant Accounting Policies 

Basis of Presentation 

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and 
the rules and regulations of Securities and Exchange Commission (“SEC”) for reporting. 

The Company effected a reverse stock split on October 19, 2022 of its outstanding shares of common stock at a ratio of 1-for-10 pursuant to a Certificate of 
Amendment to the Company's Certificate of Incorporation filed with the Secretary of State of the State of Delaware. The reverse stock split was reflected 
on the Nasdaq Global Select Market beginning with the opening of trading on October 20, 2022. Accordingly, an amount equal to the par value of the 

105

 
 
 
 
decreased shares  resulting  from  the  reverse  stock  split  was  reclassified  from  "Additional  paid-in  capital"  to  "Common  stock".  Any  fractional  post-split 
shares as a result of the reverse stock split were rounded down to the nearest whole post-split share. The reverse stock split did not change the par value of 
the Company's common stock or the authorized number of shares of the Company's common stock. All share amounts and per share amounts disclosed in 
this Annual Report on Form 10-K have been restated to reflect the reverse stock split on a retroactive basis in all periods presented.

Warrants

The Company determines the accounting classification of warrants that are issued, as either liability or equity, by first assessing whether the warrants meet 
liability classification in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity, 
and then in accordance with ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock. 
Under ASC 480-10, warrants are considered liability classified if the warrants are mandatorily redeemable, obligate the issuer to settle the warrants or the 
underlying shares by paying cash or other assets, or must or may require settlement by issuing variable number of shares.

If warrants do not meet liability classification under ASC 480-10, the Company assesses the requirements under ASC 815-40, which states that contracts 
that require or may require the issuer to settle the contract for cash are liabilities recorded at fair value, irrespective of the likelihood of the transaction 
occurring that triggers the net cash settlement feature. If the warrants do not require liability classification under ASC 815-40, in order to conclude equity 
classification, the Company assesses whether the warrants are indexed to its common stock and whether the warrants are classified as equity under ASC 
815-40 or other applicable principles of GAAP. After all relevant assessments are made, the Company concludes whether the warrants are classified as 
liability or equity. Liability classified warrants are required to be accounted for at fair value both on the date of issuance and on subsequent accounting 
period  ending  dates,  with  all  changes  in  fair  value  after  the  issuance  date  recorded  in  the  statements  of  operations  as  a  gain  or  loss.  Equity  classified 
warrants are accounted for at fair value on the issuance date with no changes in fair value recognized after the issuance date.

Use of Estimates 

The  preparation  of  financial  statements  in  conformity  with  GAAP  requires  management  to  make  estimates  and  assumptions  that  affect  the  amounts 
reported  in  the  financial  statements  and  accompanying  notes.  The  Company  bases  its  estimates  on  historical  experience  and  market-specific  or  other 
relevant assumptions that it believes are reasonable under the circumstances. The amounts of assets and liabilities reported in the Company’s balance sheets 
and the amount of expenses and income reported for each of the periods presented are affected by estimates and assumptions, which are used for, but are 
not limited to, determining the fair value of assets and liabilities, contingent consideration liability, the fair value of right-of-use assets and lease liabilities, 
embedded derivatives and stock-based compensation. Actual results could differ from such estimates or assumptions. 

Segments 

The Company has one operating segment. The Company’s chief operating decision maker, its Chief Executive Officer, manages the Company’s operations 
on a consolidated basis for the purposes of allocating resources. 

Cash, Cash Equivalents, and Restricted Cash 

The Company considers all highly liquid investments with original maturities of 90 days or less from the date of purchase to be cash equivalents. Cash 
equivalents primarily include money market funds that invest in U.S. Treasury obligations which are stated at fair value. 

The Company has issued letters of credit under its lease agreements which have been collateralized. This cash is classified as noncurrent restricted cash on 
the balance sheet based on the term of the underlying lease. 

106

 
 
 
 
The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheets that sum to the total of the 
same amounts shown in the statements of cash flows (in thousands).

Cash and cash equivalents
Restricted cash
Total cash, cash equivalents, and restricted cash

Marketable Securities 

2022

December 31,
2021

  $

  $

12,736  
896  
13,632  

  $

  $

32,905  
1,446  
34,351  

  $

  $

2020

17,807  
1,446  
19,253  

The Company generally invests its excess cash in investment grade, short to intermediate-term, fixed income securities. Such investments are considered 
available-for-sale debt securities and reported at fair value with unrealized gains and losses included as a component of stockholders’ equity. Marketable 
securities with original maturities of greater than 90 days from the date of purchase but less than one year from the balance sheet date that are available to 
be converted into cash to fund current operations are classified as short-term, while marketable securities with maturities in one year or beyond one year 
from the balance sheet date are classified as long-term. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of 
discounts to maturity, which is included in interest income on the statements of operations and comprehensive loss. Realized gains and losses and declines 
in value judged to be other-than-temporary, if any, on marketable securities are included in other expense. The cost of securities sold is determined using 
the specific identification method.

The  Company  periodically  evaluates  whether  declines  in  fair  values  of  its  marketable  securities  below  their  book  value  are  other-than-temporary.  This 
evaluation consists of several qualitative and quantitative factors regarding the severity and duration of the unrealized loss as well as the Company’s ability 
and intent to hold the marketable security until a forecasted recovery occurs. Additionally, the Company assesses whether it has plans to sell the security or 
it is more likely than not it will be required to sell any marketable securities before recovery of its amortized cost basis. Factors considered include quoted 
market prices, recent financial results and operating trends, implied values from any recent transactions or offers of investee securities, credit quality of 
debt instrument issuers, other publicly available information that may affect the value of the marketable security, duration and severity of the decline in 
value, and management’s strategy and intentions for holding the marketable security. To date, the Company has not recorded any impairment charges on its 
marketable securities related to other-than-temporary declines in market value. 

Strategic Investments

The Company has previously made investments in strategic partners and may do so again in the future. The Company does not intend to have a controlling 
interest or significant influence when it makes these strategic investments. Investments in equity securities of strategic partners with readily determinable 
fair  values  are  measured  using  quoted  market  prices,  with  changes  recorded  through  other  income  (expense),  net  in  the  statement  of  operations  and 
comprehensive loss.

Fair Value Measurements

The  Company’s  financial  instruments  during  the  periods  presented  consist  of  cash  and  cash  equivalents,  restricted  cash,  marketable  securities,  strategic 
investments,  prepaid  expenses  and  other  current  assets,  accounts  payable,  accrued  compensation,  accrued  and  other  current  liabilities,  contingent 
consideration liabilities, derivative liabilities related to debt and long-term debt. Fair value estimates of these instruments are made at a specific point in 
time, based on relevant market information. Level 3 instruments incorporate certain unobservable inputs such as the selected discount rate of the related 
loan. These estimates may be subjective in nature and involve uncertainties and matters of judgment. 

Revenue Recognition 

The  Company  recognizes  revenue  in  accordance  with  the  provisions  of  Accounting  Standards  Codification  Topic  606,  Revenue  from  Contracts  with 
Customers, or Topic 606. In determining the appropriate amount and timing of revenue to be recognized under this guidance, the Company performs the 
following five steps: (i) identifies the contract(s) with our customer; (ii) identifies the promised goods or services in the agreement and determine whether 
they are performance obligations, including whether they are distinct in the context of the agreement; (iii) measures the transaction price, including the 
constraint on variable consideration; (iv) allocates the transaction price to the 

107

 
 
 
 
 
 
 
   
   
 
 
 
   
   
 
performance obligations based on stand-alone selling prices; and (v) recognizes revenue when (or as) the Company satisfies each performance obligation. 

A  performance  obligation  is  a  promise  in  an  agreement  to  transfer  a  distinct  good  or  service  to  the  customer  and  is  the  unit  of  account  in  Topic  606. 
Significant management judgment is required to determine the level of effort required and the period over which completion of the performance obligations 
is expected under an agreement. If reasonable estimates regarding when performance obligations are either complete or substantially complete cannot be 
made, then revenue recognition is deferred until a reasonable estimate can be made. Revenue is then recognized over the remaining estimated period of 
performance using the cumulative catch-up method.

The Company allocates the total transaction price to each performance obligation based on the estimated relative stand-alone selling prices of the promised 
goods or services underlying each performance obligation. The total consideration which the Company expects to collect in exchange for the Company’s 
products is an estimate and may be fixed or variable. The Company constrains the estimated variable consideration when it assesses it is probable that a 
significant  reversal  in  the  amount  of  cumulative  revenue  recognized  may  occur  in  future  periods.  The  transaction  price  is  re-evaluated,  including  the 
estimated variable consideration included in the transaction price and all constrained amounts, in each reporting period and as uncertain events are resolved 
or  other  changes  in  circumstances  occur.  The  allocation  of  the  transaction  price  is  performed  based  on  standalone  selling  prices,  which  are  based  on 
estimated amounts that the Company would charge for a performance obligation if it were sold separately. Revenue is recognized when, or as, performance 
obligations in the contracts are satisfied, in the amount reflecting the expected consideration to be received from the goods or services transferred to the 
customers. Consideration received in advance are recorded as deferred revenue and are recognized as the related performance obligation is satisfied.

Following  is  a  description  of  the  principal  activities  from  which  the  Company  generates  revenue.  License  revenue  primarily  represent  amounts  earned 
under  agreements  that  license  our  intellectual  property  to  other  companies.  See  Note  5,  “License  Revenue,  Agreements  and  Strategic  Investment”  for 
further  detail.  Consideration  under  these  contracts  generally  includes  a  nonrefundable  upfront  payment,  development,  regulatory  and  commercial 
milestones and royalties based on net sales of approved products. 

Licenses of Intellectual Property. If the Company determines the license to intellectual property is distinct from the other performance obligations identified 
in  the  agreement  and  the  licensee  can  use  and  benefit  from  the  license,  the  Company  recognizes  revenue  from  the  estimated  transaction  price  that  is 
allocated to the license. Licensing arrangements are analyzed to determine whether the promised goods or services, which may include licenses, transfer of 
know-how, transfer of materials, research and development services and governance committee services, are distinct or whether they must be accounted for 
as part of a combined performance obligation. If the license is considered not to be distinct, the license would then be combined with other promised goods 
or services as a combined performance obligation. If the Company is involved in a governance committee, it assesses whether its involvement constitutes a 
separate performance obligation. When governance committee services are determined to be separate performance obligations, the Company determines 
the fair value to be allocated to this promised service.

Milestone Payments: At the inception of each agreement that includes milestone payments, the Company evaluates whether the milestones are considered 
probable of being achieved and estimate the amount to be included in the transaction price using the most likely amount method. If it is probable that a 
significant revenue reversal would not occur, the value of the associated milestone is included in the transaction price. For milestones that the Company do 
not deem to be probable of being achieved, the associated milestone payments are fully constrained and the value of the milestone is excluded from the 
transaction  price  with  no  revenue  being  recognized.  For  example,  milestone  payments  that  are  not  within  our  control,  such  as  regulatory-related 
accomplishments,  are  not  considered  probable  of  being  achieved  until  those  accomplishments  have  been  communicated  by  the  relevant  regulatory 
authority.  Once  the  assessment  of  probability  of  achievement  becomes  probable,  the  Company  recognizes  revenue  for  the  milestone  payment.  At  each 
reporting date, the Company assesses the probability of achievement of each milestone under our current agreements.

Royalties.  For  agreements  with  sales-based  royalties,  including  milestone  payments  based  on  the  level  of  sales,  where  the  license  is  deemed  to  be  the 
predominant  item  to  which  the  royalties  relate,  the  Company  recognizes  revenue  at  the  later  of  (a)  when  the  related  sales  occur,  or  (b)  when  the 
performance  obligation,  to  which  some  or  all  of  the  royalty  has  been  allocated,  has  been  satisfied  (or  partially  satisfied).  At  each  reporting  date,  the 
Company  estimates  the  sales  incurred  by  each  licensee  during  the  reporting  period  based  on  historical  experience  and  accrues  the  associated  royalty 
amount.

108

 
 
 
 
 
Concentrations of Risk 

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents, restricted 
cash, and marketable securities. Substantially all of the Company’s cash and cash equivalents and restricted cash is deposited in accounts with financial 
institutions that management believes are of high credit quality. Such deposits have and will continue to exceed federally insured limits. The Company 
maintains its cash with accredited financial institutions and accordingly, such funds are subject to minimal credit risk. The Company has not experienced 
any losses on its cash deposits. 

The Company’s investment policy limits investments in marketable securities to certain types of securities issued by the U.S. government, its agencies and 
institutions  with  investment-grade  credit  ratings  and  places  restrictions  on  maturities  and  concentration  by  type  and  issuer.  The  Company  is  exposed  to 
credit risk in the event of a default by the financial institutions holding its cash, cash equivalents, restricted cash and marketable securities and issuers of 
marketable  securities  to  the  extent  recorded  on  the  balance  sheets.  As  of  December  31,  2022  and  2021,  the  Company  had  no  off-balance  sheet 
concentrations of credit risk. 

The Company depends on third-party suppliers for key raw materials used in its manufacturing processes and is subject to certain risks related to the loss of 
these third-party suppliers or their inability to supply the Company with adequate raw materials. 

In March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic. To date, the Company’s operations have not been materially 
impacted by the COVID-19 pandemic. However, the Company cannot at this time predict the specific extent, duration, or full impact that the COVID-19 
pandemic  will  have  on  its  financial  condition  and  results  of  operations,  including  ongoing  and  planned  clinical  studies.  The  impact  of  the  COVID-19 
pandemic  on  the  financial  performance  of  the  Company  will  depend  on  future  developments.  These  developments  and  the  impact  of  the  COVID-19 
pandemic on the financial markets and the overall economy are highly uncertain. The Company continues to monitor the impact the COVID-19 pandemic 
may have on the clinical development of its product candidates, including potential delays or modifications to its ongoing and planned studies.  

Research and Development Expenses and Accruals

Costs  related  to  research,  design,  and  development  of  drug  candidates  are  charged  to  research  and  development  expense  as  incurred.  Research  and 
development  costs  include,  but  are  not  limited  to,  payroll  and  personnel  expenses  for  personnel  contributing  to  research  and  development  activities, 
laboratory supplies, outside services, licenses acquired to be used in research and development, manufacturing of clinical material, pre-clinical testing and 
consultants and allocated overhead, including rent, equipment, depreciation, and utilities. Research and development costs are expensed as incurred unless 
there is an alternative future use in other research and development projects. Payments made prior to the receipt of goods or services to be used in research 
and development are deferred and recognized as expense in the period in which the related goods are received or services are rendered. Such payments are 
evaluated for current or long-term classification based on when they will be realized.

As part of the process of preparing its financial statements, the Company is required to estimate expenses resulting from its obligations under contracts with 
vendors  and  consultants  and  clinical  site  agreements  in  connection  with  conducting  clinical  trials.  The  financial  terms  of  these  contracts  are  subject  to 
negotiations  which  vary  from  contract  to  contract  and  may  result  in  payment  flows  that  do  not  match  the  periods  over  which  materials  or  services  are 
provided under such contracts. The Company’s objective is to reflect the appropriate expenses in its financial statements by matching those expenses with 
the period in which services and efforts are expended. The Company accounts for these expenses according to the progress of the production of clinical 
trial materials or based on progression of the clinical trial, as measured by patient progression and the timing of various aspects of the trial. The Company 
determines  accrual  estimates  by  taking  into  account  discussion  with  applicable  personnel  and  outside  service  providers  as  to  the  progress  or  state  of 
consummation of goods and services, or the services completed. 

During the course of a clinical trial, the rate of expense recognition is adjusted if actual results differ from the Company’s estimates. The Company makes 
estimates of accrued expenses as of each balance sheet date in its financial statements based on the facts and circumstances known at that time. The clinical 
trial accrual is dependent in part upon the timely and accurate reporting of contract research organizations, contract manufacturers, and other third-party 
vendors. Although the Company does not expect its estimates to be materially different from amounts actually incurred, its understanding of the status and 
timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting changes in estimates in any 
particular period. Adjustments to prior period estimates have not been material for the years ended December 31, 2022 and 2021.

109

 
Contingent Consideration Liability

The  Company  has  entered  into  and  may  continue  to  enter  into,  license  agreements  to  access  and  utilize  certain  technology.  In  each  case,  the  Company 
evaluates whether the license agreement results in the acquisition of an asset or a business. To date, all of the Company’s license agreements have been 
considered acquisitions of assets and none have been considered acquisitions of a business. For license agreements that are considered to be acquisitions of 
assets,  the  upfront  payments  for  such  license,  as  well  as  any  future  milestone  payments  made  before  product  approval,  are  immediately  recognized  as 
research and development expense when due, provided there is no alternative future use of the rights in other research and development projects. Some of 
the Company’s license agreements also include contingent consideration in the form of an obligation to issue additional shares of the Company’s common 
stock based on the achievement of certain milestones. The Company assesses on a continuous basis whether (i) such contingent consideration meets the 
definition of a derivative, and (ii) whether it can be classified within stockholders’ equity. Until such time when equity classification criteria are met or the 
milestones expire, the contingent consideration is classified as a liability. The derivative related to this contingent consideration is measured at fair value as 
of  each  balance  sheet  date  with  the  related  change  in  fair  value  being  reflected  in  operating  expenses.  Upon  a  reassessment  event  that  results  in  the 
contingent consideration no longer meeting the definition of a derivative and/or meeting equity classification criteria, the final change in fair value of the 
instrument is recorded within operating expenses and the liability is reclassified into stockholders’ equity.

Property and Equipment, Net 

Property and equipment are stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful 
lives of the respective assets, generally three years. Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful
lives or the term of the lease. Depreciation and amortization begin at the time the asset is placed in service. Maintenance and repairs are charged to expense 
as incurred and costs of improvement are capitalized. 

Leases 

Prior to January 1, 2020, the Company accounted for its leases of office space and laboratory facilities under non-cancelable operating lease agreements 
and recognized related rent expense on a straight-line basis over the term of the lease. Incentives granted under the Company’s facilities lease, including 
allowances to fund leasehold improvements and rent holidays, were recognized as reductions to rental expense on a straight-line basis over the term of the 
lease. Lessor funded leasehold improvement incentives not yet received were recorded in prepaid expenses and other current assets on the balance sheets. 
The Company did not assume renewals in its determination of the lease term unless they were deemed to be reasonably assured at the inception of the lease 
and began recognizing rent expense on the date that it obtained the legal right to use and control the leased space. Deferred rent consisted of the difference 
between cash payments and the rent expense recognized. The Company recognized a liability for costs that would continue to be incurred under a lease 
contract for its remaining term without economic benefit at its fair value when the entity ceased using the right conveyed by the contract, which was when 
the space was completely vacated.

Subsequent  to  January  1,  2020,  the  Company  determines  whether  the  arrangement  is  or  contains  a  lease  at  the  inception  of  the  arrangement  and  if  so, 
whether such a lease is classified as a financing lease or an operating lease. Operating leases are included in operating lease right-of-use assets, (“ROU 
assets”), operating lease liabilities, net of current portion, and accrued and other current liabilities on the Company’s balance sheets. The Company has 
elected not to recognize on the balance sheets leases with terms of one year or less. Operating lease ROU assets represent the Company’s right to use an 
underlying asset for the lease term and are considered long-lived assets for purposes of identifying, recognizing and measuring impairment. Operating lease 
liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and operating lease liabilities are 
recognized  based  on  the  present  value  of  lease  payments  over  the  expected  lease  term.  As  the  Company’s  leases  do  not  provide  an  implicit  rate,  the 
Company uses its incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease 
payments in a similar economic environment, in determining the present value of lease payments. The operating lease ROU asset also includes any lease 
payments made or incentives received and impairment charges if the Company determines the ROU asset is impaired and excludes lease incentives. The 
Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options to 
extend or terminate the lease. Lease expense for lease payments is recognized on a straight-line basis over the lease term. 

The Company has elected to not separate lease and non-lease components for its leased assets and accounts for all lease and non-lease components of its 
agreements as a single lease component.  The lease components resulting in a 

110

 
 
 
ROU asset have been recorded on the balance sheets and are amortized as lease expense on a straight-line basis over the lease term.

The Company has subleased all of its Brisbane, California facility and a portion of its South San Francisco, California facility under agreements considered 
to  be  operating  leases  according  to  ASC  842.  The  Company  has  not  been  legally  released  from  its  primary  obligations  under  the  original  leases  and 
therefore  it  continues  to  account  for  the  original  leases  as  it  did  before  commencement  of  the  subleases.  The  Company  records  both  fixed  and  variable 
payments received from the sublessee in its statements of operations on a straight-line basis as an offset to rent expense.

The Company does not have any material financing leases.

Impairment of Long-Lived Assets 

The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not 
be  fully  recoverable.  If  indicators  of  impairment  exist  and  the  undiscounted  future  cash  flows  that  the  assets  are  expected  to  generate  are  less  than  the 
carrying value of the assets, the Company reduces the carrying amount of the assets through an impairment charge, to their estimated fair value based on a 
discounted cash flow approach or, when available and appropriate, to comparable market values. During the year ended December 31, 2020, the Company 
evaluated indicators of impairment for the ROU asset and related leasehold improvements considering the current economic environment and COVID-19 
outbreak, its impact on subleasing activity and the exit of its previous headquarters located in Brisbane, California. The Company concluded the carrying 
value of these assets were not fully recoverable and recorded an impairment charge of $2.6 million. See Note 7, “Commitments and Contingencies”.

Determining estimated discounted cash flows for purposes of an impairment analysis requires the Company to make estimates and assumptions regarding 
the  amount  and  timing  of  sublease  income.  There  are  often  risks  and  uncertainties  associated  with  the  intent  to  sublease  offices  and  laboratory  space. 
Consequently,  the  eventual  realized  sublease  revenues  may  vary  from  estimates  as  of  the  impairment  testing  date  and  adjustments  may  occur  in  future 
periods.

Stock-Based Compensation 

The  Company  measures  compensation  expense  for  all  stock-based  awards  based  on  their  grant  date  fair  value.  For  stock-based  awards  with  service 
conditions  only,  stock-based  compensation  expense  is  recognized  over  the  requisite  service  period  using  the  straight-line  method.  For  awards  with 
performance  conditions,  the  Company  evaluates  the  probability  of  achieving  performance  condition  at  each  reporting  date.  The  Company  begins  to 
recognize stock-based compensation expense using an accelerated attribution method when it is deemed probable that the performance condition will be 
met. Forfeitures are recognized as they occur. 

The Company uses the Black-Scholes option-pricing model to estimate the fair value of stock option awards that do not contain market conditions. The 
Black-Scholes option-pricing model requires assumptions to be made related to the expected term of an award, expected dividends, expected volatility and 
risk-free rate. 

The Company has used the Monte-Carlo option-pricing model to estimate the fair value of stock option awards that contain only market conditions. The 
Monte-Carlo  option  pricing  model  uses  similar  input  assumptions  as  the  Black-Scholes  model;  however,  it  further  incorporates  into  the  fair-value 
determination the possibility that the market condition may not be satisfied.

Embedded Derivatives of the Loan Agreement

The Company measures derivative liability related to debt at fair value. Estimated fair value of the derivative liability related to debt, initially measured and 
recorded on the date of the amendment of the loan and security agreement, is considered to be a Level 3 instrument. The fair value of the derivative liability 
related  to  debt  is  based  on  the  term  loan  principal,  the  date  of  maturity,  the  contractual  term  loan  interest  rate,  the  convertible  discount  factor,  and  the 
selected  discount  rate  of  the  loan.  The  derivative  liability  related  to  debt  is  recorded  at  fair  value  at  the  end  of  each  reporting  period  with  changes  in 
estimated fair values recognized as a component of other income (expense), net in the statements of operations and comprehensive loss.

111

 
 
 
 
Restructuring

The Company recognizes restructuring charges related to reorganization plans that have been committed to by management and when liabilities have been 
incurred. In connection with these activities, the Company records restructuring charges at fair value for a) contractual employee termination benefits when 
obligations  are  associated  to  services  already  rendered,  rights  to  such  benefits  have  vested,  and  payment  of  benefits  is  probable  and  can  be  reasonably 
estimated, and b) one-time employee termination benefits when management has committed to a plan of termination, the plan identifies the employees and 
their  expected  termination  dates,  the  details  of  termination  benefits  are  complete,  it  is  unlikely  changes  to  the  plan  will  be  made  or  the  plan  will  be 
withdrawn and communication to such employees has occurred.

One-time employee termination benefits are recognized in their entirety when communication has occurred, and future services are not required. Contract 
termination costs to be incurred over the remaining contract term without economic benefit are recorded in their entirety when the contract is canceled. 

The recognition of restructuring charges requires the Company to make certain judgments and estimates regarding the nature, timing and amount of costs 
associated with the planned reorganization plan. At the end of each reporting period, the Company evaluates the remaining accrued restructuring balances 
to ensure that no excess accruals are retained, and the utilization of the provisions are for their intended purpose in accordance with developed restructuring 
plans.

Income Taxes 

The Company uses the asset and liability method of accounting for income taxes, in which deferred tax assets and liabilities are recognized for future tax 
consequences  attributable  to  the  differences  between  the  financial  statement  carrying  amounts  of  existing  assets  and  liabilities  and  their  respective  tax 
bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary 
differences are expected to be reversed. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income in the period that 
includes  the  enactment  date.  A  valuation  allowance  is  established  if  it  is  more  likely  than  not  that  all  or  a  portion  of  the  deferred  tax  asset  will  not  be 
realized. 

The Company’s tax positions are subject to income tax audits. The Company recognizes the tax benefit of an uncertain tax position only if it is more likely 
than not that the position is sustainable upon examination by the taxing authority, based on the technical merits. The tax benefit recognized is measured as 
the  largest  amount  of  benefit  which  is  more  likely  than  not  to  be  realized  upon  settlement  with  the  taxing  authority.  The  Company  recognizes  interest 
accrued  and  penalties  related  to  unrecognized  tax  benefits  in  its  tax  provision.  The  Company  evaluates  uncertain  tax  positions  on  a  regular  basis.  The 
evaluations are based on a number of factors, including changes in facts and circumstances, changes in tax law, correspondence with tax authorities during 
the  course  of  the  audit,  and  effective  settlement  of  audit  issues.  The  provision  for  income  taxes  includes  the  effects  of  any  accruals  that  the  Company 
believes are appropriate, as well as the related net interest and penalties. 

On  March  18,  2020,  the  Families  First  Coronavirus  Response  Act  (“FFCR  Act”),  and  on  March  27,  2020,  the  Coronavirus  Aid,  Relief,  and  Economic 
Security Act (“CARES Act”) were each enacted in response to the COVID-19 pandemic. The FFCR Act and the CARES Act contain numerous tax-related 
provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative 
minimum  tax  credit  refunds,  modifications  to  the  net  interest  deduction  limitations  and  technical  corrections  to  tax  depreciation  methods  for  qualified 
improvement property.

On  June  29,  2020  California  State  Assembly  Bill  85  (the  “Trailer  Bill”)  was  enacted  which  suspends  the  use  of  California  net  operating  loss  (“NOL”) 
deductions and certain tax credits, including research and development tax credits, for the 2020, 2021, and 2022 tax years.

In December 2020, the Consolidated Appropriations Act, 2021 (the “CAA”) was signed into law. The CAA included additional funding through tax credits 
as part of its economic package for 2021.

The  FFCR  Act,  CARES  Act,  Trailer  Bill  and  CAA  did  not  have  a  material  impact  on  the  Company’s  financial  statements  as  of  December  31,  2020; 
however,  the  Company  continues  to  examine  the  impacts  the  FFCR  Act,  CARES  Act  and  Trailer  Bill  may  have  on  its  business,  results  of  operations, 
financial condition and liquidity.

112

 
 
 
 
 
 
 
 
On March 10, 2021, Congress passed the American Rescue Plan Act (“ARP Act”) of 2021.  On March 11, 2021, President Biden signed the bill into law. 
The ARP contains employment-related provisions. The ARP is a follow-up to the CARES Act, and that part of the CAA Act of 2021 devoted to COVID-19 
relief.  The ARP includes Paycheck Protection Program (PPP) funding changes and expanded the Employee Retention Credit (the “ERC”) provisions under 
the CAA. The Company did not apply for a PPP loan. Regarding the ERC, management has calculated that a total ERC of $535,504 for 2020 and $957,839 
for  2021  are  available.  The  Company  does  not  expect  the  ARP  to  have  a  material  impact  on  the  Company’s  financial  statements.  Any  change  to  the 
deferred taxes as a result of the enactment of the ARP is expected to be fully offset to the valuation allowance.

On  August  16,  2022,  President  Joe  Biden  signed  The  Inflation  Reduction  Act  of  2022  (the  “IRA”).    The  IRS  includes  a  new  Corporate  Alternative 
Minimum  Tax  (“CAMT”)  that  imposes  a  15%  tax  on  a  corporation’s  Adjusted  Financial  Statement  Income  (“AFSI”).  The  CAMT  applies  to  any 
corporation (certain exceptions apply) whose average annual AFSI for any consecutive three tax year period ending after December 31, 2021 and preceding 
tax years exceeds $1 billion.  The IRA is not expected to have a material impact on the Company.

Net Loss per Common Share 

Basic net loss per share is calculated by dividing net loss by the weighted average number of shares outstanding for the period. Diluted net loss per share is 
calculated by dividing net loss by the weighted average number of shares of common stock and potential dilutive common stock equivalents outstanding 
during the period if the effect is dilutive. Since the Company was in a loss position for all periods presented, basic net loss per share is the same as diluted 
net loss per share as the effects of potentially dilutive securities are antidilutive. The calculation of diluted loss per share also requires that, to the extent the 
presumed issuance of additional shares as contingent consideration is dilutive to loss per share for the period, adjustments to net loss used in the calculation 
are  required  to  remove  the  change  in  fair  value  of  the  contingent  consideration  liability  for  the  period.  Likewise,  adjustments  to  the  denominator  are 
required to reflect the related dilutive shares. In all periods presented, the Company’s outstanding stock options, convertible preferred stock, early exercised 
common  stock  subject  to  future  vesting,  restricted  stock  accounted  for  as  options  common  and  preferred  stock  warrants  and  presumed  issuance  of 
additional shares as contingent consideration were excluded from the calculation of diluted net loss per share because their effects were antidilutive.

Comprehensive Loss 

Comprehensive  loss  includes  net  loss  and  certain  changes  in  stockholders’  equity  that  are  excluded  from  net  loss,  primarily  unrealized  losses  on  the 
Company’s marketable securities.

Recently Issued Accounting Pronouncements 

The  Company  continues  to  monitor  new  accounting  pronouncements  issued  by  the  FASB  and  does  not  believe  any  accounting  pronouncements  issued 
through the date of this report will have a material impact on the Company's financial statements.

3. Fair Value Measurements 

The Company determines the fair value of financial and non-financial assets and liabilities based on the assumptions that market participants would use in 
pricing  the  asset  or  liability  in  an  orderly  transaction  between  market  participants  at  the  measurement  date.  The  identification  of  market  participant 
assumptions provides a basis for determining what inputs are to be used for pricing each asset or liability. A fair value hierarchy has been established which 
gives precedence to fair value measurements calculated using observable inputs over those using unobservable inputs. This hierarchy prioritized the inputs 
into three broad levels as follows:

•

•

•

Level 1: Quoted prices in active markets for identical instruments 

Level 2: Other significant observable inputs (including quoted prices in active markets for similar instruments) 

Level 3: Significant unobservable inputs (including assumptions in determining the fair value of certain investments) 

113

 
 
The  carrying  amounts  of  financial  instruments  such  as  cash  and  cash  equivalents,  restricted  cash,  prepaid  expenses  and  other  current  assets,  accounts 
payable, accrued compensation, accrued and other current liabilities approximate the related fair values due to the short maturities of these instruments. As 
the long-term debt is subject to variable interest rates that are based on market rates which are regularly reset, considering level 2 inputs, the Company 
believes the carrying value of the long-term debt approximates its fair value.

The Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used in such measurements 
were as follows (in thousands):

Assets:

Cash equivalents:

Money market funds
Total cash equivalents
Short-term marketable securities:

U.S. treasuries
U.S. government debt securities
Total short-term marketable securities

Total assets subject to fair value measurements
   on a recurring basis

Assets:

Cash equivalents:

Money market funds
Total cash equivalents
Short-term marketable securities:

U.S. treasuries
U.S. government debt securities
Total short-term marketable securities
Long-term marketable securities:

U.S. treasuries

Total long-term marketable securities

Total assets subject to fair value measurements
   on a recurring basis

Total

Level 1

Level 2

Level 3

December 31, 2022

  $

5,083     $
5,083    

5,083     $
5,083    

—     $
—    

30,758    
51,301    
82,059  

—    
—    
—  

30,758    
51,301    
82,059  

  $

87,142     $

5,083     $

82,059     $

Total

Level 1

Level 2

Level 3

December 31, 2021

  $

21,421     $
21,421    

21,421     $
21,421    

—     $
—    

52,146    
3,024    
55,170  

1,993    
1,993    

—    
—    
—  

—    
—    

52,146    
3,024    
55,170  

1,993    
1,993    

  $

78,584     $

21,421     $

57,163     $

—  
—  

—  
—  
—  

—  

—  
—  

—  
—  
—  

—  
—  

—  

The  Company  estimates  the  fair  value  of  its  money  market  funds,  U.S.  and  foreign  commercial  paper,  U.S.  and  foreign  corporate  debt  securities,  U.S. 
treasuries,  and  U.S.  government  debt  securities  by  taking  into  consideration  valuations  obtained  from  third-party  pricing  services.  The  pricing  services 
utilize  industry  standard  valuation  models,  including  both  income  and  market-based  approaches,  for  which  all  significant  inputs  are  observable,  either 
directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities, issuer credit 
spreads; benchmark securities; prepayment/default projections based on historical data; and other observable inputs. See Note 4, “Marketable Securities,” 
for further information regarding the carrying value of the Company's financial instruments. 

In December 2021, the Company recorded a derivative liability relating to an amendment to its loan and security agreement. It comprised of a redemption 
conversion feature which met the definition of a derivative instrument, which terms are included in the amended loan and security agreement. See Note 8, 
“Term Loan Facility”. The Company classified this instrument as a liability on the balance sheet because the feature was not clearly and closely related to 
its host instrument and met the definition of a derivative. The derivative liability was initially recorded at fair value upon issuance of the loan amendment 
and is being subsequently remeasured to fair value at each reporting date. Changes in the fair value of the derivative liability are recognized as a component 
of other income (expense), net in the statements of operations. There were no adjustments to the fair value of the derivative as of December 31, 2022.

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The  following  table  provides  a  reconciliation  of  the  derivative  liability  related  to  debt  measured  at  fair  value  on  a  recurring  basis  using  significant 
unobservable inputs (Level 3) (in thousands):

Balance at December 31, 2020
Additions
Conversion
Balance at December 31, 2021
Conversion
Balance at December 31, 2022

Derivative Liability related to 
Debt Conversion Feature

(1)

$

$

—  
1,782  
(819 )
963  
(963 )
—  

(1)

Transfers into Level 3 during the year ended December 31, 2021 relate to the call option with Hercules Capital, Inc, where the lender can convert principal debt into 
common stock. Transfers out of Level 3 during the year relate to the conversions calls of this option made by Hercules Capitals, Inc. 

4. Marketable Securities

Marketable securities, which are classified as available-for-sale, consisted of the following (in thousands):

Cash equivalents:

Money market funds
Total cash equivalents
Short-term marketable securities:
U.S. government debt securities
U.S. treasuries

Total short-term marketable securities
Total marketable securities

Cash equivalents:

Money market funds
Total cash equivalents

Short-term marketable securities:
U.S. government debt securities
U.S. treasuries

Total short-term marketable securities
Long-term marketable securities:

U.S. treasuries

Total long-term marketable securities
Total marketable securities

Amortized
Cost Basis

December 31, 2022

Unrealized
Gains

Unrealized
Losses

Fair
 Value

5,083     $
5,083    

51,491    
30,820    
82,311    
87,394     $

—     $
—    

6    
1    
7    
7     $

—     $
—    

(196 )  
(63 )  
(259 )  
(259 )   $

5,083  
5,083  

51,301  
30,758  
82,059  
87,142  

Amortized
Cost Basis

December 31, 2021

Unrealized
Gains

Unrealized
Losses

Fair
 Value

21,421     $
21,421    

3,026    
52,186    
55,212    

1,995  
1,995  
78,628     $

—     $
—    

—    
—    
—    

—  
—  
—     $

—     $
—    

(2 )  
(40 )  
(42 )  

(2 )  
(2 )    
(44 )   $

21,421  
21,421  

3,024  
52,146  
55,170  

1,993  
1,993  
78,584  

  $

  $

  $

  $

At  December  31,  2022,  the  remaining  contractual  maturities  of  available-for-sale  debt  securities  were  less  than  a  year.  There  have  been  no significant 
realized  gains  or  losses  on  available-for-sale  debt  securities  for  the  periods  presented.  Available-for-sale  debt  securities  that  were  in  a  continuous  loss 
position but were not deemed to be other than temporarily impaired were immaterial at both December 31, 2022 and 2021. The Company does not intend 
to and believes it is not more likely than not that it will be required to sell these debt securities before their maturities.

See Note 3, “Fair Value Measurements,” for further information regarding the fair value of the Company's financial instruments. 

5. License Revenue, Agreements and Strategic Investment

The Company has entered into license agreements with other pharmaceutical and biotechnology companies. The Company’s accounts receivable balances 
may contain billed and unbilled amounts from milestones and other 

115

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
   
 
   
 
 
     
     
     
   
 
 
 
 
 
 
     
     
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
   
 
   
 
 
     
     
     
   
 
 
 
 
 
 
     
     
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     
     
     
   
 
 
   
   
 
 
 
   
   
 
 
 
contingent payments. The Company performs a regular review of its customers’ credit risk and payment histories, including payments made after period 
end. Historically, the Company has not experienced credit loss from its accounts receivable and, therefore, has not recorded a reserve for estimated credit 
losses as of December 31, 2022.

In accordance with the license agreements, the Company recognized revenue as follows:

Jocasta Neuroscience, Inc. 

(1)

2022

Year ended December 31,
2021

2020

  $
  $

236  
236  

  $
  $

4,784     $
4,784     $

—  
—  

(1)

Jocasta Neuroscience, Inc. was deemed a related party at the effective time the agreement was made on December 17, 2021.

License Agreement with Jocasta Neuroscience, Inc.

In December 2021, the Company signed a License Agreement with Jocasta Neuroscience, Inc. (“the Jocasta Agreement”) to exclusively license its rights in 
the α-Klotho asset for development and commercialization, and included a sublicense agreement under the original license agreement with the University 
of California, San Francisco. Under the Jocasta Agreement, the Company received a $5.0 million upfront cash payment from Jocasta Neuroscience, Inc. 
The Company may also receive additional payments based on development milestones, approval milestones, and sales-based royalties, per indication. The 
Jocasta agreement is recognized in accordance with ASC 606, Revenue from Contracts with Customers, and is classified under License Revenue.

Promises that the Company concluded were distinct performance obligations in the License Agreement included: (1) the license of intellectual property and 
delivery of know-how, and (2) the transfer of licensed compounds and materials.

In order to determine the transaction price, the Company evaluated all the payments to be received during the duration of the contract. Fixed consideration 
exists in the form of the upfront payment. Regulatory milestones and royalties were considered variable consideration. The estimated variable consideration 
is  constrained  until  the  Company  determines  it  is  probable  that  a  significant  reversal  in  the  amount  of  cumulative  revenue  recognized  will  not  occur  in 
future  periods.  Milestone  payments  are  constrained  and  not  included  in  the  transaction  price  due  to  the  uncertainties  of  research  and  development.  The 
Company  will  re-evaluate  the  transaction  price,  including  the  estimated  variable  consideration  included  in  the  transaction  price  and  all  constrained 
amounts, in each reporting period and as uncertain events are resolved or other changes in circumstances occur. The Company determined that the initial 
transaction price consists of the upfront payment of $5.0 million. The allocation of the transaction price is performed based on standalone selling prices, 
which  are  based  on  estimated  amounts  that  the  Company  would  charge  for  a  performance  obligation  if  it  were  sold  separately.  The  transaction  price 
allocated to the license of intellectual property and delivery of know-how was recognized upon grant of license and delivery of know-how. The transaction 
price allocated the transfer of licensed compounds and materials, will be recognized over time as the materials are delivered. Consideration received in 
advance are recorded as deferred revenue and will be recognized as the performance obligations are satisfied. 

For the years ended December 31, 2022, 2021 and 2020, the Company recognized $0.2 million, $4.8 million and zero, respectively, of license revenue, 
primarily related to the delivery of a performance obligation consisting of a license of intellectual property and related know-how which was delivered in 
2021. For the years ended December 31, 2022 and 2021, the Company recorded zero and $0.2 million, respectively, as deferred revenue.

License Agreements with Research Institutions

In  May  2019,  the  Company  entered  into  a  license  agreement  with  The  Regents  of  the  University  of  California  on  behalf  its  San  Francisco  campus 
(collectively, “UCSF”) which provides the Company the rights to certain patents and related know-how to make, use, sell, offer for sale and import certain 
products  and  practice  certain  methods  for  use  in  the  development  of  human  therapeutics,  which  excludes  the  provision  of  services  to  third  parties  for 
consideration of any kind. The license to the Company is subject to UCSF’s reserved rights under the licensed intellectual property for educational and 
non-commercial research purposes and a requirement to substantially manufacture any licensed products in the United States. The Company is obligated to 
use diligent efforts to develop and obtain regulatory approval for at least one product commercialized pursuant to the agreement, and must meet certain 
regulatory and development milestones. In June 2019, as part of this license agreement, the Company issued 12,000 shares of its common stock to UCSF. 
In addition, the Company is obligated to pay an annual license maintenance fee and may be 

116

 
 
 
 
 
 
 
 
 
 
 
 
 
 
obligated to make milestone payments or issue up to an additional 3,400 shares of its common stock upon the occurrence of specified development events, 
up  to  aggregate  milestone  payments  of  $13.6  million  for  each  product  licensed  under  the  agreement,  and  upon  commercialization,  to  make  royalty 
payments in the low single digit percentages (subject to a specified minimum annual royalty) based on net sales of products commercialized pursuant to the 
agreement. None of these events had occurred and no milestone payments or royalty payments had been recognized as of December 31, 2022. The upfront 
issuance of 12,000 shares of the Company’s common stock was valued at $1.0 million and recorded as additional paid-in capital upon issuance in June 
2019.  In  December  2021,  the  Company  entered  an  agreement  to  exclusively  license  its  rights  in  the  α-Klotho  asset  to  Jocasta  Neuroscience,  Inc.  for 
development and commercialization. Under the license agreement, Jocasta Neuroscience, Inc. is, in addition to the payments due to the Company, required 
to  make  all  payments  due  to  UCSF  from  the  Company  under  the  UCSF  License.  See  above,  “License  Agreement  with  Jocasta  Neuroscience,  Inc.”  for 
additional information on the Jocasta Agreement.

The Company has also entered into license agreements with various research institutions which have provided the Company with rights to patents, and in 
certain  cases,  research  “know-how”  and  proprietary  research  tools  to  research,  develop  and  commercialize  drug  candidates.  In  addition  to  upfront 
consideration paid to these various research institutions in either cash or shares of the Company’s common stock, the Company may be obligated to make 
milestone  payments,  payable  in  cash  and/or  the  issuance  of  shares  of  the  Company’s  common  stock  upon  achievement  of  certain  specified  clinical 
development  and/or  sales  events.  The  contingent  consideration  liability  considered  to  be  a  derivative  associated  with  the  potential  issuance  of  common 
stock related to these license agreements was not significant at December 31, 2022 and 2021. To date, none of these events has occurred and no contingent 
consideration, milestone or royalty payments have been recognized.

Ascentage Commercial Agreements

The Company was a party to three agreements, or the Commercial Agreements, with Ascentage Pharma: (a) a compound library and option agreement 
executed in February 2016, the Library Agreement, granting the Company the right to research and nominate an active compound from Ascentage’s library 
of Bcl compounds and subsequently nominate a development candidate from any active compound in order to begin GLP toxicology work for indications 
outside of oncology, which expired in February 2022; (b) a license agreement executed in February 2016 granting the Company rights to an Ascentage 
Pharma compound known as APG1252, or the APG1252 License Agreement, which the Company terminated in July 2020 due to the Company’s decision 
to  prioritize  the  progression  of  UBX1325;  and  (c)  a  second  license  agreement  executed  in  January  2019  granting  the  Company  world-wide  rights  to 
develop  and  commercialize  UBX0601,  the  active  parent  molecule  of  our  lead  drug  candidate  UBX1325,  outside  of  Greater  China,  or  the  Original  Bcl 
Agreement, for indications outside of oncology. 

The Commercial Agreements referenced above include cash payments of up to $70.3 million as well as the equity payments of up to an aggregate of (a) 
93,333 shares of common stock in the event there is only one licensed product, and (b) 133,333 shares of common stock in the event there are two or more 
licensed  products,  in  each  case  to  be  issued based  on  the  Company’s  achievement  of  certain  preclinical  and  clinical  development  and  sales  milestone 
events. The Company is required to make 80% of all equity payments to Ascentage Pharma and the remaining 20% to an academic institution from whom 
Ascentage  Pharma  had  previously  licensed  the  technology.  The  milestones  include  the  advancement  of  additional  compounds  into  Investigational  New 
Drug application (“IND”) enabling studies, the filing of an IND, the commencement of clinical studies, Food and Drug Administration (“FDA”) and/or 
European Medicines Agency approval, and a net sales threshold. The Original Bcl License Agreement also includes tiered royalties in the low-single digits 
based on sales of licensed products.   

The Company issued no additional shares pursuant to these agreements during the year ended December 31, 2022. The Company had previously issued 
126,975 shares of common stock to Ascentage Pharma and 29,194 shares of common stock to the academic institution from whom Ascentage Pharma had 
previously licensed the technology. In May 2021, the Company initiated a Phase 2 proof-of-concept study of UBX1325 in patients with diabetic macular 
edema. As a result of the first patient dosed in the Phase 2 proof-of-concept UBX1325 study in June 2021, the Company triggered a milestone payment of 
$2.0  million  for  Ascentage  Pharma,  which  the  Company  elected  to  settle  in  shares  of  the  Company’s  common  stock.  At  the  instruction  of  Ascentage 
Pharma, the Company issued 29,477 shares of its common stock to Ascentage Pharma as of August 2021 with a fair market value of $1.1 million net of 
withholding  taxes,  and  10,527  shares  of  its  common  stock  to  the  academic  institution  with  a  fair  market  value  of  $0.4  million  at  settlement  date.  The 
milestone  payment  was  recognized  as  research  and  development  expense  in  the  statement  of  operations  and  comprehensive  loss  during  the  year  ended 
December  31,  2021.  The  Company  had  previously  issued  36,166  shares  of  its  common  stock  with  a  value  of  $2.3  million  to  Ascentage  Pharma  as  of 
December 31, 2021.

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The Commercial Agreements included contingent consideration in the form of additional issuances of shares of the Company’s common stock based on the 
achievement of the specified milestones. Upon the July 2020 termination of the license to APG1252, the Company determined that the contingency no 
longer  applied  and  adjusted  the  fair  value  of  the  contingent  consideration  liability  to  zero.  To  date,  no  royalties  were  due  from  the  sales  of  licensed 
products.

Strategic Investment

The  Company  previously  held  an  equity  investment  in  Ascentage  International,  an  affiliate  of  Ascentage  Pharma.  The  equity  interest  represented  an 
insignificant level of ownership in the investee and was recorded within strategic investment on the Company’s condensed balance sheets. The fair value of 
the Company’s equity investment in Ascentage International was zero as of December 31, 2022 and 2021. The change in fair value of this investment was 
zero for the years ended December 31, 2022 and 2021, and $0.5 million for the year ended December 31, 2020 and was recorded in other income and 
(expense) on the statements of operations and comprehensive loss.

6. Balance Sheet Components 

Property and Equipment, Net 

Property and equipment, net, consists of the following (in thousands): 

Laboratory equipment
Computer equipment
Furniture and fixtures
Leasehold improvements
Total property and equipment
Less: accumulated depreciation and amortization
Construction-in-progress
Total property and equipment, net

December 31,

2022

2021

  $

  $

4,197     $
412    
726    
15,244    
20,579    
(12,754 )  
—    
7,825     $

5,718  
499  
818  
15,158  
22,193  
(12,258 )
7  
9,942  

Depreciation and amortization expense related to property and equipment was $2.2 million, $2.9 million and $3.4 million for the years ended December 31, 
2022, 2021 and 2020, respectively. 

Accrued and Other Current Liabilities 

Accrued and other current liabilities consist of the following (in thousands): 

Operating lease liability - current portion
Accrued research and development
Liability related to early exercise shares
Accrued other

7. Commitments and Contingencies 

Leases 

December 31,

2022

2021

  $

  $

3,100     $
1,623  

10    
601    
5,334     $

4,378  
1,390  
10  
592  
6,370  

In February 2019, the Company entered into a lease agreement for new office and laboratory space in South San Francisco, California. The term of the 
lease agreement commenced in May 2019. The lease has an initial term from occupancy of approximately ten years ending on December 31, 2029 with an 
option  to  extend  the  term  for  an  additional  eight  years  at  then-market  rental  rates.  The  total  base  rent  payment  escalates  annually  based  on  a  fixed 
percentage beginning from the 13th month of the lease agreement. The Company will also be responsible for the operating expenses and real estate taxes 
allocated to the building and common areas. Pursuant to the lease agreement, the landlord provided the Company with a tenant improvement allowance of 
$10.7 million, which was included in 

118

 
 
 
 
 
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 
 
   
 
 
 
 
 
 
 
 
deferred  rent  and  leasehold  improvements  on  the  balance  sheet  at  December  31,  2019.  In  connection  with  the  execution  of  the  lease  agreement,  the 
Company delivered a letter of credit of approximately $0.9 million to the landlord.

In May 2016, the Company executed a non-cancellable lease agreement for office and laboratory space in Brisbane, California which commenced in May 
2016 and expired in October 2022. The lease agreement includes an escalation clause for increased rent and a renewal provision allowing the Company to 
extend this lease for an additional four years by giving the landlord written notice of the election to exercise the option at least fifteen months prior to the 
original expiration of the lease term. The lease provides for monthly base rent amounts escalating over the term of the lease and the lessor provided the 
Company a $3.9 million tenant improvement allowance to complete the laboratory and office renovation which was recorded as deferred rent liability and 
leasehold  improvements  within  property  and  equipment,  net.  In  May  2017,  the  Company  entered  into  an  amendment  to  expand  the  leased  space  and 
received a three-month rent holiday for the expanded space.

The Company’s operating leases include various covenants, indemnities, defaults, termination rights, security deposits and other provisions customary for 
lease transactions of this nature.

The following table summarizes the components of lease expense, which are included in operating expenses in the Company’s statements of operations and 
comprehensive loss (in thousands):

Operating lease expense
Variable lease expense
Sublease income
Impairment of operating lease right-of-use asset

Total lease expense

2022

Year ended December 31,
2021

2020

  $

  $

  $

4,264  
1,318  
(4,317 )    
—  
1,265     $

  $

4,357  
1,633  
(2,578 )    
—  
3,412     $

4,721  
1,168  
—  
1,409  
7,298  

Variable lease payments include amounts relating to common area maintenance, real estate taxes and insurance and are recognized in the statements of 
operations and comprehensive loss as incurred. 

The following table summarizes supplemental information related to leases (in thousands):

Cash paid for amounts included in the measurement of lease liabilities

Operating cash flows from operating leases
Weighted-average remaining lease term (years)

Operating leases

Weighted-average discount rate (percentage)

Operating leases

2022

Year ended December 31,
2021

2020

  $

6,283  

  $

6,653  

  $

5,797  

7.0  

7.7  

6.0 %    

5.9 %   

8.5  

5.8 %

The following table summarizes the maturities of lease liabilities as of December 31, 2022 (in thousands):

2023
2024
2025
2026
2027
Thereafter

Total future minimum lease payments

Less: Amount representing interest

Present value of future minimum lease payments

Less: Current portion of operating lease liability
Noncurrent portion of operating lease liability

Amount

  $

  $

4,810  
4,964  
5,123  
5,287  
5,457  
11,435  
37,076  
(6,985 )
30,091  
(3,100 )
26,991  

In February  2020,  the  Company  completed  its  move  into  the  new  office  and  laboratory  space  in  South  San  Francisco,  exited  its  previous  offices  and 
laboratory space in Brisbane, California, and began to actively market this space for 

119

 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
   
   
   
   
   
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     
     
   
 
     
     
   
   
   
   
 
     
     
   
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
sublease. Concurrent with this move and in consideration of real estate market conditions, in particular due to the COVID-19 pandemic in March 2020, the 
Company  identified  indicators  of  impairment  in  the  related  asset  group,  which  included  the  leased  ROU  asset  and  related  leasehold  improvements 
associated with the lease. The Company subsequently evaluated and compared the net book value of the asset group to the estimated undiscounted future 
cash  flows  over  the  remaining  term  of  the  lease  and  concluded  that  an  impairment  had  occurred.  The  discounted  estimated  future  cash  flows  included 
estimates of sublease rentals through the end of the lease term, which ends on October 31, 2022, utilizing a discount rate of 3.5% based on the Company’s 
estimated  incremental  borrowing  rate  at  that  time.  The  estimated  discounted  cash  flows  were  compared  to  the  net  book  value  of  the  ROU  asset  and 
leasehold  improvements  resulting  in  an  impairment  loss  of  $2.6  million  during  the  year  ended  December  31,  2020,  which  was  included  in  operating 
expense in the statements of operations and comprehensive loss. No impairment loss was recorded during the year ended December 31, 2022 and 2021.

In February 2021, the Company entered into an agreement to sublease the first floor of the Brisbane, California facility, consisting of approximately 27,000 
square feet, to Zymergen, Inc., through August 31, 2022. The base sublease rent rate is $3.53 per rental square foot per month and will increase by 3% on 
March 1, 2022 through expiration of the agreement. Additionally, the subtenant is required to pay approximately 41% of operating expenses and property 
management  fees  that  the  Company  is  required  to  pay  under  the  lease  for  the  Brisbane,  California  facility.  In  May  2021,  the  Company  entered  into  an 
agreement  to  sublease  the  second  floor  of  the  Brisbane,  California  facility,  consisting  of  approximately  11,500  square  feet,  to  CareDx,  Inc.,  through 
September 30, 2022. The base sublease rent rate is $1.00 per rental square foot per month through expiration of the agreement. Additionally, the subtenant 
is required to pay approximately 30% of operating expenses and property management fees that the Company is required to pay under the lease for the 
Brisbane, California facility. The Company incurred initial direct costs of $0.1 million in sublease commissions related to entering into the agreements to 
sublease the Brisbane, California facility. To account for the commissions, the Company capitalized the total commissions amount and will amortize the 
balance over the term of the sublease. Sublease income was $1.3 million, $1.5 million and zero for the years ended December 31, 2022, 2021 and 2020, 
respectively, which was offset against total rent expense. 

In  June  2021,  the  Company  entered  into  an  agreement  to  sublease  a  portion  of  the  first  floor  of  the  South  San  Francisco  facility,  consisting  of 
approximately 23,000 square feet, to Freenome Holdings, Inc., through August 31, 2024. The base sublease rent rate is $6.25 per rental square foot per 
month  and  will  increase  annually  by  3.5%  through  expiration  of  the  agreement.  Additionally,  the  subtenant  is  required  to  pay  approximately  37%  of 
operating expenses and property management fees that the Company is required to pay under the lease for the South San Francisco, California facility. The 
Company incurred initial direct costs of $0.2 million in sublease commissions related to entering into the agreements to sublease the South San Francisco, 
California facility. To account for the commissions, the Company capitalized the total commissions amount and will amortize the balance over the term of 
the sublease. No impairment loss was recorded during the year ended December 31, 2022. Sublease income was $2.2 million, $1.1 million and zero for the 
years ended December 31, 2022, 2021 and 2020, respectively, which was offset against total rent expense.

In  May  2022,  the  Company  entered  into  an  agreement  to  sublease  a  portion  of  the  second  floor  of  the  South  San  Francisco  facility,  consisting  of 
approximately 15,000 square feet, to Initial Therapeutics, Inc. The sublease term will commence on July 1, 2022 and continues through June 30, 2024. The 
base sublease rent rate is $7.80 per rental square foot per month and will increase by 3.5% annually through the expiration of the agreement. Additionally, 
the subtenant is required to pay approximately 24% of operating expenses and property management fees that the Company is required to pay under the 
lease for the South San Francisco facility. The Company incurred initial direct costs of $0.1 million in sublease commissions related to entering into the 
agreements  to  sublease  the  South  San  Francisco,  California  facility.  To  account  for  the  commissions,  the  Company  capitalized  the  total  commissions 
amount and will amortize the balance over the term of the sublease. No impairment loss was recorded during the year ended December 31, 2022. Sublease 
income was $0.8 million for the year ended December 31, 2022 which was offset against total rent expense.

Indemnifications 

The Company indemnifies each of its officers and directors for certain events or occurrences, subject to certain limits, while the officer or director is or was 
serving  at  the  Company’s  request  in  such  capacity,  as  permitted  under  Delaware  law  and  in  accordance  with  the  Company’s  amended  and  restated 
certificate of incorporation and bylaws. The term of the indemnification period lasts as long as an officer or director may be subject to any proceeding 
arising out of acts or omissions of such officer or director in such capacity. 

The maximum amount of potential future indemnification is unlimited; however, the Company currently holds director and officer liability insurance. This 
insurance allows the transfer of risk associated with the Company’s exposure and 

120

 
may enable  the  Company  to  recover  a  portion  of  any  future  amounts  paid.  The  Company  believes  that  the  fair  value  of  these  potential  indemnification 
obligations is minimal. Accordingly, the Company has not recognized any liabilities relating to these obligations for any period presented.

8. Term Loan Facility

On August 3, 2020, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Hercules Capital, Inc. (“Hercules”). Under the 
Loan Agreement, Hercules provided the Company with access to a term loan with an aggregate principal amount of up to $80.0 million (the “Term Loan 
Facility”), available in four tranches, subject to certain terms and conditions. The first tranche of $25.0 million was advanced to the Company on the date 
the Loan Agreement was executed. The milestones for the remaining tranches have not yet been reached and as of December 31, 2022 are not expected to 
be  reached  as  they  were  dependent,  in  whole  or  in  part,  upon  continued  advancement  in  the  clinical  development  of  UBX0101  in  patients  with 
osteoarthritis of the knee.

On December 15, 2021, the Company entered into an amendment to the Loan and Security Agreement (“the Loan Amendment”). The Loan Amendment 
includes a Lender Optional Conversion where after the effective date and until the six-month anniversary of the execution date, the lender may elect to 
convert to equity of the Company all or any part of up to twenty percent (20%) of the original principal amount for a maximum amount of $5.0 million. As 
of December 31, 2021, the lender had elected to convert $2.3 million of the outstanding principal into equity. The Company incurred approximately $0.1 
million in loan issuance costs relating to the amendment, which were offset against the loan proceeds and are accounted for as a loan discount. 

During the first quarter of 2022, Hercules Capital, Inc. had elected to convert the remaining convertible debt option into equity of the Company’s common 
stock. This resulted in the conversion of $2.7 million of principal debt into common stock, and reducing the outstanding principal under the first tranche to 
$20.0 million.

Pursuant  to  the  Loan  Amendment,  the  Company  was  able  to  achieve  specific  milestones  related  to  its  clinical  trials  and  raising  additional  capital.  As  a 
result, the Company is able to extend its interest only period and expects to make interest only payments through April 1, 2023. The Company expects to 
then repay the principal balance and interest in equal monthly installments through August 1, 2024. The interest only period may extend an additional 3 
months to June 1, 2023 should the Company meet additional specific milestones related to its clinical trials.

On  January  25,  2023,  the  Company  entered  into  a  second  amendment  to  the  Loan  and  Security  Agreement  with    Hercules  Capital,  Inc.  whereby  the 
amortization date was extended from March 1, 2023 to April 1, 2023. Should all three of the interest only milestones be satisfied prior to this date, the 
interest only period may extend an additional two months to June 1, 2023.

The Company may prepay advances under the Loan Agreement, in whole or in part, at any time subject to a prepayment charge of up to 1.50%  of  any 
amount prepaid, depending upon when the prepayment occurs. Upon prepayment or repayment of all or any of the term loans under the Term Loan Facility, 
the Company is required to pay an end of term fee (“End of Term Fee”) equal to 6.25% of the total aggregate amount of the term loans being prepaid or 
repaid, which has been recorded as a discount on the principal balance upon issuance.

Interest on the term loan accrues at a per annum rate equal to the greater of (i) the Wall Street Journal prime rate plus 6.10% and (ii) 9.35%. On December 
31,  2022,  the  interest  rate  on  the  term  loan  was  13.60%.  Interest  expense  is  calculated  using  the  effective  interest  method  and  is  inclusive  of  non-cash 
amortization of capitalized loan issuance costs. At December 31, 2022, the effective interest rate was 19.87%.

Under the terms of the Loan Agreement, the Company granted first priority liens and security interests in substantially all of the Company’s assets, other 
than intellectual property, as collateral for the obligations thereunder. The Company also granted Hercules the right, at their discretion, to participate in any 
closing  of  any  single  subsequent  financing  as  defined  up  to  a  maximum  aggregate  amount  of  $2.0  million.  The  Loan  Agreement  also  contains 
representations  and  warranties  by  the  Company  and  Hercules,  indemnification  provisions  in  favor  of  Hercules  and  customary  affirmative  and  negative 
covenants, and events of default, including a material adverse change in the Company’s business, payment defaults, breaches of covenants following any 
applicable  cure  period,  and  a  material  impairment  in  the  perfection  or  priority  of  Hercules’  security  interest  in  the  collateral.  The  liquidity  covenant 
beginning  July  1,  2021,  originally  to  maintain  $15.0  million  in  unrestricted  cash,  was  subsequently  amended  on  December  15,  2021,  requiring  the 
Company to maintain at least $10.0 million in unrestricted cash upon the election to convert $5.0 million of the loan principal into shares of the Company's 
common stock. Through February 14, 2022, Hercules had elected to 

121

 
 
convert the full $5.0 million of the loan principal. In the event of default by the Company under the Loan Agreement, the Company may be required to 
repay all amounts then outstanding under the Loan Agreement. The substantial doubt regarding the Company’s ability to continue as a going concern does 
not constitute a material adverse event under the terms of the Loan Agreement. 

The Company has determined that the risk of subjective acceleration under the material adverse events clause included in the Loan Agreement is remote 
and, therefore, have classified the outstanding principal amount in current and long-term liabilities based on the timing of scheduled principal payments. As 
of December 31, 2022 and as of the date of the issuance of these financial statements, the Company was in compliance with all covenants and has not been 
notified of an event of default by the lender under the Loan Agreement.

As of December 31, 2022, the carrying value of the term loan consists of $20.0 million principal outstanding less the debt discount and issuance costs of 
approximately $1.2 million. The End of Term Fee of $1.6 million is recognized over the life of the term loan as interest expense using the effective interest
method. The debt issuance costs have been recorded as a debt discount, netted within long-term debt, which are being accreted to interest expense through 
the maturity date of the term loan.  

Interest expense relating to the term loan, which is included in interest expense in the statements of operations and comprehensive loss, was $3.6 million, 
$3.2 million and $1.3 million for the years ended December 31, 2022, 2021  and 2020, respectively.

Future principal payments for the long-term debt are as follows (in thousands):

2023
2024

Total principal payments

End of term fee due at maturity in 2024

Total principal and end of term fee payments

Unamortized discount and debt issuance costs
Present value of remaining debt payments

Current portion of long-term debt

Long-term debt, net

9. Related Party Transactions 

Licensing Revenue – Related Party

December 31, 2022

  $

  $

10,078  
9,922  
20,000  
1,563  
21,563  
(1,196 )
20,367  
(9,476 )
10,891  

In December 2021, the Company entered into a license agreement with Jocasta Neuroscience, Inc. A member of the Board of Directors of the Company is 
also  an  affiliate  of  Jocasta  Neuroscience,  Inc.  The  agreement  provides  for  an  upfront  fee  of  $5.0  million  and  the  opportunity  for  future  research  and 
development services to be provided. The Company recognized $0.2 million and $4.8 million of licensing revenue for the years ended December 31, 2022 
and 2021, respectively.

10. Equity Financing

On October 19, 2022, the Company effected a reverse stock split of its outstanding share of common stock at a ratio of 1-for-10 pursuant to a Certificate of 
Amendment to the Company's Certificate of Incorporation filed with the Secretary of State of the State of Delaware. The reverse stock split was reflected 
on the Nasdaq Global Select Market beginning with the opening of trading on October 20, 2022. All share amounts and per share amounts disclosed in this 
Annual Report on Form 10-K have been restated to reflect the reverse stock split on a retroactive basis in all periods presented.

The Company has 10,000,000 shares of convertible preferred stock authorized for issuance, par value of $0.0001 per share. As of December 31, 2022 and 
2021, no shares of preferred stock were issued and outstanding. 

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The Company has 300,000,000 shares of common stock authorized for issuance, par value of $0.0001 per share. Holders of the Company’s common stock 
are entitled to one vote per share. As of December 31, 2022 and 2021, there were 14,215,302 and 6,299,158 shares, respectively, of common stock issued 
and outstanding.

 Follow-On Offering

In  August  2022,  the  Company  closed  an  underwritten  offering  (the  “Follow-On  Offering”)  in  which  the  Company  issued  and  sold  an  aggregate  of 
6,428,571 of the Company’s common stock together with warrants (the "Warrants”) to purchase up to 6,428,572 of the Company’s common stock at an 
offering price of at an aggregate offering price of $7.00 per unit. The Warrants have an exercise price of $8.50 per share underlying the Warrant. These 
Warrants were recorded as a component of stockholders’ equity within additional paid-in capital. The gross proceeds to the Company were $45.0 million 
before deducting underwriting discounts and commissions and other offering expenses. The net proceeds of the Follow-On Offering were approximately 
$41.7 million. 

The Warrants are exercisable at any time after their original issuance and on or prior to the five-year anniversary of the original issuance date. A holder of 
Warrants  may  not  exercise  the  warrant  if  the  holder,  together  with  its  affiliates,  would  beneficially  own  more  than  4.99%  of  the  number  of  shares  of 
common stock outstanding immediately after giving effect to such exercise. No warrants have been exercised as of December 31, 2022.

At-the-Market Offering

In June 2019, the Company filed a Registration Statement on Form S-3 (the “Shelf Registration Statement”), covering the offering of up to $250.0 million 
of  common  stock,  preferred  stock,  debt  securities,  warrants  and  units.  The  Shelf  Registration  Statement  included  a  prospectus  covering  the  offering, 
issuance and sale of up to $75.0 million of the Company’s common stock from time to time through an “at-the-market” offering under the Securities Act of 
1933, as amended (the “Initial ATM Offering Program”). The SEC declared the Shelf Registration Statement effective on June 6, 2019.

In June 2019, the Company also entered into a sales agreement (the “June 2019 Sales Agreement”) with Cowen and Company, LLC (“Cowen”) to sell 
shares of the Company’s common stock, from time to time, with aggregate gross sales proceeds of up to $75.0 million, through the ATM Offering Program 
under which Cowen acts as its sales agent. Cowen is entitled to compensation for its services equal to up to 3.0% of the gross proceeds of any shares of 
common  stock  sold  through  Cowen  under  the  June  2019  Sales  Agreement.  During  the  year  ended  December  31,  2020,  the  Company  issued  and  sold
500,226  shares  of  its  common  stock  through  its  ATM  Offering  Program  and  received  net  proceeds  of  approximately  $37.3  million,  after  deducting 
commissions and other offering expenses of $1.3 million.

In July 2020, the Company filed an additional prospectus supplement to the Shelf Registration Statement. This prospectus supplement covers the offering, 
issuance and sale of up to an additional $50.0 million of the Company’s common stock from time to time through an additional “at-the-market” offering 
under the Securities Act of 1933, as amended (the “Additional ATM Offering Program”). The Initial ATM Offering Program and Additional ATM Offering 
Program are collectively called the “ATM Offering Programs”.

In July 2020, the Company entered into a second sales agreement (the “July 2020 Sales Agreement”) with Cowen to sell shares of the Company’s common 
stock, from time to time, with aggregate gross sales proceeds of up to $50.0 million, through the Additional ATM Offering Program under which Cowen 
will act as its sales agent. The issuance and sale of shares of common stock by the Company pursuant to the July 2020 Sales Agreement are also deemed an 
“at-the-market” offering under the Securities Act of 1933, as amended (the “Securities Act”). Cowen is entitled to compensation for its services equal to up 
to 3.0% of the gross proceeds of any shares of common stock sold through Cowen under the July 2020 Sales Agreement. During the year ended December
31, 2021, there were 118,707 shares of the Company’s common stock sold through the Initial ATM Offering Program and 70,746 shares of the Company’s 
common  stock  sold  through  the  Additional  ATM  Offering  Program  and  received  total  net  proceeds  of  approximately  $10.4  million,  after  deducting 
commissions and other offering expenses of $0.3 million. 

In March 2022, the Company filed a Registration Statement on Form S-3 (the “March 2022 Shelf Registration Statement”), covering the offering of up to 
$125.0 million of common stock, preferred stock, debt securities, warrants, and units, which was declared effective by the SEC in May 2022. In March 
2022, the Company also entered into a sales agreement (the “March 2022 Sales Agreement”) with Cowen and Company, LLC ("Cowen") as sales agent to 
sell shares of the Company’s common stock, from time to time, with aggregate gross sales proceeds of up to $50.0 million pursuant to the March 2022 
Shelf Registration Statement as an “at-the-market” offering under the Securities 

123

 
 
Act (the "March 2022 ATM Offering Program"). Cowen is entitled to up to 3.0%  of  the  gross  proceeds  of  any  shares  of  common  stock  sold  under  the 
March 2022 Sales Agreement. During the year ended December 31, 2022, there were 786,544 shares of the Company's common stock sold pursuant to the 
March 2022 Sales Agreement and the Company received total net proceeds of approximately $9.1 million, after deducting commissions and other offering 
expenses of $0.3  million.  On  August  17,  2022,  the  Company  entered  into  Amendment  No.  1  (the  “Amendment”)  to  the  March  2022  Sales  Agreement, 
which Amendment decreased the amount of the Company’s common stock that can be sold by the Company through Cowen under the March 2022 Sales 
Agreement, from an aggregate offering of up to $50.0 million to an aggregate offering of up to $25.0 million. Following the Amendment, $15.6 million of 
shares of common stock remained available for sale under the March 2022 Sales Agreement, as amended, as of December 31, 2022.

In October 2022, the Company filed a Registration Statement on Form S-3 (the “October 2022 Shelf Registration Statement”), covering the offering of up 
to $250.0 million of common stock, preferred stock, debt securities, warrants, and units. In October 2022, the Company also entered into a sales agreement 
(the “October 2022 Sales Agreement”) with Cowen as sales agent to sell shares of the Company’s common stock, from time to time, with aggregate gross 
sales proceeds of up to $50.0 million pursuant to the October 2022 Shelf Registration Statement as an “at-the-market” offering under the Securities Act. 
Cowen is entitled to up to 3.0% of the gross proceeds of any shares of common stock sold under the October 2022 Sales Agreement. During the year ended 
December 31, 2022, there were no shares of the Company's common stock sold pursuant to the October 2022 Sales Agreement.

Equity Purchase Agreement

In  September  2021,  the  Company  entered  into  an  equity  purchase  agreement  (the  “Purchase  Agreement”  or  “Equity  Purchase  Agreement”)  and  a 
registration  rights  agreement  with  Lincoln  Park  Capital  Fund,  LLC  (“Lincoln  Park”  or  “Investor”)  which  provides  for  the  sale  to  Lincoln  Park  up  to
$30,000,000 of shares (the “Purchase Shares”) of its common stock over the thirty-six (36) month term of the Purchase Agreement. In connection with the 
Purchase  Agreement,  Lincoln  Park  purchased  102,040  Purchase  Shares  at  a  purchase  price  of  $2.94  per  share,  for  a  total  gross  purchase  price  of  $3.0 
million (the “Initial Purchase”), and the Company issued 25,244 shares of common stock to Lincoln Park as a commitment fee in connection with entering
into the Purchase Agreement. The Company recognized $0.8 million of other expense relating to the commitment fee share issuance. As of December 31, 
2021,  the  Company  had  initiated  the  purchase  of  an  additional  0.3  million  shares  of  the  Company’s  common  stock  amounting  to  $5.3 million in gross 
proceeds. During the year ended December 31, 2022, the Company initiated purchases of an additional 90,000 shares of the Company’s common stock
amounting to $0.9 million in gross proceeds.

Under the Purchase Agreement, the Company has sole discretion, subject to certain conditions, on any business day selected by the Company to require 
Lincoln Park to purchase up to 10,000 shares of common stock (the “Regular Purchase Amount”) at the Purchase Price (as defined below) per purchase 
notice (each such purchase, a “Regular Purchase”). The Regular Purchase Amount may be increased as follows: up to 15,000 shares if the closing price is 
not below $35.00, up to 20,000 shares if the closing price is not below $50.00, and up to 25,000 shares if the closing price is not below $70.00. Lincoln 
Park’s  committed  obligation  under  each  Regular  Purchase  is  capped  at  $2,000,000,  unless  the  Parties  agree  otherwise.  The  purchase  price  for  Regular 
Purchases (the “Purchase Price”) shall be equal to the lesser of: (i) the lowest sale price of the common shares during the Purchase Date, or (ii) the average 
of the three (3) lowest closing sale prices of the common shares during the ten (10) business days prior to the Purchase Date. 

In addition to Regular Purchases and subject to certain conditions and limitations, the Company in its sole discretion may require Lincoln Park on each 
Purchase Date to purchase on the following business day up to the lesser of (i) three (3) times the number of shares purchased pursuant to such Regular 
Purchase  or  (ii)  30%  of  the  trading  volume  on  the  Accelerated  Purchase  Date  (the  “Accelerated  Purchase”)  (unless  the  Parties  agree  otherwise)  at  a 
purchase price equal to the lesser of 97% of (i) the closing sale price on the Accelerated Purchase Date, or (ii) the Accelerated Purchase Date’s volume 
weighted  average  price  (the  “Accelerated  Purchase  Price”).  The  Company  has  the  sole  right  to  set  a  minimum  price  threshold  for  each  Accelerated 
Purchase in the notice provided with respect to such Accelerated Purchase and under certain circumstances and in accordance with the Purchase Agreement 
the Company may direct multiple Accelerated Purchases in a day.

The aggregate number of shares that the Company can sell to Lincoln Park under the Purchase Agreement may not exceed 1,106,580 shares of the common 
stock  (which  is  equal  to  approximately  19.99%  of  the  shares  of  the  common  stock  outstanding  immediately  prior  to  the  execution  of  the  Purchase 
Agreement) (the “Exchange Cap”), unless (i) shareholder approval is obtained to issue Purchase Shares above the Exchange Cap, in which the Exchange 
Cap will no longer apply, or (ii) the average price of all applicable sales of common stock to Lincoln Park under the Purchase 

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Agreement equals or exceeds $29.40 per share; provided that at no time may Lincoln Park (together with its affiliates) beneficially own more than 9.99% of 
the Company’s issued and outstanding common stock. 

The Purchase Agreement contains customary representations, warranties, covenants, closing conditions, indemnification and termination provisions. The 
Purchase Agreement may be terminated by the Company at any time, at its sole discretion, without any cost or penalty, by giving one business day notice to 
Lincoln Park. Further, Lincoln Park has covenanted not to engage in any direct or indirect short selling or hedging of the Common Shares. There are no 
limitations on the use of proceeds, financial or business covenants, restrictions on future financings (other than restrictions on the Company’s ability to 
enter into a similar type of agreement or Equity Line of Credit during the Term, excluding an At-The-Market transaction with a registered broker-dealer), 
rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement. Issuances under the Purchase Agreement were to be 
made pursuant to the Company's Registration Statement on Form S-3 filed in July 2019, which has since expired. The Company would need to file a new 
prospectus supplement covering issuances under the Purchase Agreement in order to continue using the facility. 

11. Corporate Restructuring

In February 2022, the Company implemented a corporate restructuring to align its resources to focus on its UBX1325 program while further extending 
operating capital. The restructuring resulted in an elimination of 29 positions, or approximately 50% of the Company’s workforce, in the first nine months 
of  2022.  The  Company  incurred  a  one-time  employee  benefits  and  severance  charge  of  approximately  $1.9  million  in  operating  expenses  which  was 
primarily recorded in the first nine months of 2022. Restructuring charges incurred under this plan primarily consisted of employee termination benefits. 
Employee  termination  benefits  include  $1.6  million  of  severance  costs,  $0.2  million  of  employee-related  benefits,  $0.1  million  of  payroll  taxes  and 
supplemental one-time termination payments. Charges and other costs related to the workforce reduction and structure realignment, and non-cash share-
based compensation credits related to the forfeiture of stock options for $1.7 million, are included in operating expenses in the Statement of Operations and 
Comprehensive Loss. Of the total charge, $1.4 million was recorded to research and development expenses and $0.5 million was recorded to general and 
administrative expenses during the year ended December 31, 2022. The Company may also incur additional costs not currently contemplated due to events 
that may occur as a result of, or that are associated with, the restructuring. 

12. Stock-Based Compensation 

Summary of Equity Incentive Plans 

In March 2018, the Company’s board of directors adopted the Company’s 2018 Incentive Award Plan (the “2018 Plan”). The 2018 Plan was approved by 
the Company’s stockholders in April 2018 and became effective in May 2018. The 2018 Plan initially reserved 428,994 shares for the issuance of stock 
options  as  well  as  any  automatic  annual  increases  in  the  number  of  shares  of  common  stock  reserved  for  future  issuance  under  the  2018  Plan.  Awards 
granted under the 2018 Plan expire no later than ten years from the date of grant. For stock options, the option price shall not be less than 100%  of  the 
estimated fair value on the day of grant. Options granted typically vest over a four-year period but may be granted with different vesting terms. Unvested 
options not exercised at the time of an employee’s termination of employment are added back to the 2018 Plan. 

Following the Company’s IPO and in connection with the effectiveness of the 2018 Plan, the 2013 Equity Incentive Plan (the “2013 Plan”) terminated and 
no further awards will be granted under that plan. All outstanding awards under the 2013 Plan will continue to be governed by their existing terms and the 
shares that remained outstanding for issuance under the 2013 Plan were transferred into the 2018 Plan. As of December 31, 2022, there were in aggregate 
1,562,202 shares of common stock authorized for issuance under the 2018 Plan.

Prior to its termination, the 2013 Plan provided for the granting of incentive stock options (“ISOs”), non-statutory stock options (“NSOs”) and restricted 
shares to employees, directors, and consultants at the discretion of management and the board of directors. The exercise price of an ISO and NSO shall not 
be less than 100% of the estimated fair value of the shares on the date of grant, and the exercise price of an ISO and NSO granted to a 10% stockholder 
shall not be less than 110% of the estimated fair value of the shares on the date of grant. For awards granted between September 2017 and February 2018 
with an exercise price of $3.42, a deemed fair value ranging from $3.95 to $8.47  per  share  was  used  in  calculating  stock-based  compensation  expense, 
which was determined using management hindsight. Options granted under the 2013 Plan expire no later than ten years from the date of grant and generally 
vest 

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over a  four-year  period  but  may  be  granted  with  different  vesting  terms.  Unvested  options  not  exercised  at  the  time  of  an  employee’s  termination  of 
employment are added back to the 2018 Plan.

Under the 2013 Plan, the Company permitted early exercise of certain stock options prior to vesting. These unvested shares are subject to repurchase by the 
Company  at  the  original  issuance  price  in  the  event  the  optionee’s  employment  is  terminated  either  voluntarily  or  involuntarily.  The  amounts  paid  for 
shares  purchased  under  an  early  exercise  of  stock  options  and  subject  to  repurchase  by  the  Company  are  reported  as  a  liability  and  reclassified  into
additional paid-in capital as the shares vest. 

In March 2020, the Company’s board of directors approved the Company’s 2020 Employment Inducement Incentive Plan (“the 2020 Plan”), to provide for 
grants to newly hired employees as a material inducement for them to commence employment with the Company. The 2020 Plan initially reserved 110,000 
shares for the issuance of stock options, and in November 2020, the Company reserved an additional 150,000 shares of common stock for future issuance 
under the 2020 Plan. Awards granted under the 2020 Plan expire no later than ten years from the date of grant. For stock options, the option price shall not 
be less than 100% of the estimated fair value on the day of grant. Options granted typically vest over a four-year period but may be granted with different 
vesting terms. Unvested options not exercised at the time of an employee’s termination of employment are added back to the 2020 Plan. As of December 
31, 2022, there were in aggregate 246,000 shares of common stock authorized for issuance under the 2020 Plan.

Equity Incentive Plan Activity

The following sections summarize activity under the Company’s equity incentive plans.

Stock Options and Restricted Stock Units (RSUs) Activity 

A summary of the Company’s stock option activity under the 2013 Plan, 2018 Plan and 2020 Plan for the year ended December 31, 2022 is as follows: 

Shares
Available
for Grant

Outstanding
Options

Weighted-
Average
Exercise 
Price

Weighted-
Average
Remainin
g
Contract

Term    

Aggregate
Intrinsic
Value

Balance at December 31, 2021

Shares added
Granted
Exercised
Canceled

Balance at December 31, 2022

Vested and exercisable at December 31, 2022

Vested and expected to vest at December 31, 2022

531,484     
332,265     
(986,279 )   
—     
191,368     
68,838     

866,589    $
—     
926,652     
—     
(183,303 )   
1,609,938    $
511,496    $
1,609,938    $

   (in Years)    (in thousands)  
—  

7.7    $

60.46     
—    
4.19    
—    
65.37    

27.51     

59.91     

27.51     

8.3    $
6.0    $
8.3    $

251  

—  

251  

The  total  intrinsic  value  of  options  exercised  was  zero and $1.1  million  for  the  years  ended  December  31,  2022  and  2021,  respectively.  The  weighted-
average estimated fair value of stock options granted was $3.11 and $35.79 for the years ended December 31, 2022 and 2021, respectively. 

The aggregate intrinsic value of options exercisable was zero as of December 31, 2022 and 2021. 

In September 2020, the board of directors granted retention stock-based awards to employees covering an aggregate of 320,000 shares of common stock, 
including options to purchase an aggregate of 25,000 shares of common stock and 295,985 of restricted stock units. The awards are all time-based vesting 
and vest over three to four years.

During  the  years  ended  December  31,  2022  and  2021,  there  were  no  shares  issued  in  settlement  of  stock-based  compensation  awards  accounted  for  as 
liability awards.

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The following table summarizes the Company’s RSU, RSA and PSU activity for the year ended December 31, 2022:

Unvested at December 31, 2021

Granted
Released
Canceled

Unvested at December 31, 2022

Shares

199,024     $
59,627     $
(90,284 )   $
(22,034 )   $
146,333     $

Weighted-
Average
Grant Date
Fair Value

39.23  
8.77  
38.65  
35.99  

27.66  

As  of  December  31,  2022,  the  total  stock-based  compensation  cost  related  to  options,  RSAs,  RSUs  and  PSUs  granted  but  not  yet  amortized  was  $12.3 
million and will be recognized over a weighted-average period of approximately 2.9 years. The total grant date fair value of RSUs and RSAs vested during 
the years ended December 31, 2022 and 2021 was approximately $0.6 million and $3.1 million, respectively. 

In March 2020, the board of directors granted the Company’s newly hired Chief Executive Officer stock-based awards covering an aggregate of 110,000 
shares of common stock, including options to purchase an aggregate of 80,000 shares of common stock, 12,000 RSUs, 15,000 PSUs, and 3,000 RSAs that 
immediately  vested  on  the  grant  date.  The  stock-based  awards  were  granted  pursuant  to  the  2020  Employment  Inducement  Incentive  Plan,  which  was 
approved  by  the  board  of  directors  in  March  2020  to  provide  for  grants  to  newly  hired  employees  as  a  material  inducement  for  them  to  commence 
employment with the Company. 

In February 2022, the Company’s board of directors approved the granting of retention awards to critical and important Company personnel. The awards 
consisted of 189,333 stock options and 46,332 restricted stock units with a grant date total fair value of $2.0 million and $0.5 million, respectively.

Valuation of Stock Options

The Company uses the Black-Scholes option-pricing model for determining the estimated fair value and stock-based compensation related to stock options 
and ESPP awards. The fair value of stock options granted to employees was estimated on the date of grant using the Black-Scholes option pricing model 
using the following assumptions: 

Expected term of options (in years)
Expected stock price volatility
Risk-free interest rate
Expected dividend yield

The valuation assumptions were determined as follows: 

2022
5.55
86.22%-93.17%
2.41%-4.01%

Year ended December 31,
2021
6.0
85.7%-88.5%
1.08%-1.35%

2020
6.1
92.6%-107.9%
0.29%-0.52%

—    

—    

—  

Expected Term—The expected term represents the period that the options granted are expected to be outstanding and is determined using the simplified 
method (based on the mid-point between the vesting date and the end of the contractual term) as the Company has concluded that its stock option exercise 
history does not provide a reasonable basis upon which to estimate expected term.

Expected Volatility—Due to limited historical data, the Company estimates stock price volatility based on a combined weighted-average of the Company’s 
historical  average  volatility  and  that  of  a  selected  peer  group  of  comparable  publicly  traded  companies  within  the  biotechnology  and  pharmaceutical 
industry that were deemed to be representative of future stock price trends over the expected life of the award. 

Risk-Free Interest Rate—The Company based the risk-free interest rate over the expected term of the options based on the constant maturity rate of U.S. 
Treasury securities with similar maturities as of the date of the grant.

Expected  Dividend  Yield—The  Company  has  never  paid  any  dividends  and  does  not  plan  to  pay  dividends  in  the  foreseeable  future.  Therefore,  the 
expected dividend yield is zero.

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The fair value of ESPP awards was not material for all periods presented.

Performance Stock Units 

The PSUs were originally scheduled to vest as to 5,000 PSUs upon the attainment of (a) a volume-weighted average per share closing trading price of the 
Company’s common stock of at least $368.75 over a trailing 30-day period or (b) a change in control transaction in which the price per share to the holders 
of the Company’s common stock is at least $368.75 and as to 10,000 PSUs (x) at such time as the Company’s market capitalization reaches at least $2.5 
billion, as measured based on the volume weighted-average closing trading price over a trailing 30  day  period  or  (y)  a  change  in  control  transaction  in 
which the consideration paid to the Company’s stockholders is equal to at least $2.5 billion, as determined by the Company’s board of directors. In January 
2021, the board of directors modified the PSUs to vest as to 5,000 PSUs upon the attainment of (a) a volume-weighted average per share closing trading 
price of the Company’s common stock of at least $180.00 over a trailing 30-day period or (b) a change in control transaction in which the price per share to 
the holders of the Company’s common stock is at least $180.00 and as to 10,000 PSUs upon the attainment of (x) a volume-weighted average per share 
closing trading price of the Company’s common stock of at least $360.00 over a trailing 30-day period or (y) a change in control transaction in which the 
price per share to the holders of the Company’s common stock is at least $360.00, as determined by the Company’s board of directors.

For the PSU awards, the Company used the Monte-Carlo option pricing model to determine the fair value of awards at the date of grant. The Monte-Carlo 
option  pricing  model  uses  similar  input  assumptions  as  the  Black-Scholes  model;  however,  it  further  incorporates  into  the  fair-value  determination  the 
possibility that the market condition may not be satisfied. Compensation costs related to awards with a market-based condition are recognized regardless of 
whether the market condition is ultimately satisfied. Compensation cost is not reversed if the achievement of the market condition does not occur. The total 
grant date fair value of the PSU awards was determined to be $0.7 million and will be recognized as compensation expense over the weighted-average 
derived service period of approximately 4.3 years. The incremental fair value of the PSUs on the modification date of $31,000 are added to the unamortized 
value of the original grant of $569,000 and will be amortized to expense over the new implied service periods of 1.63 years to 2.79 years.

Performance and Market Contingent Stock Options

In  January  2021,  the  board  of  directors  modified  1,747  performance  and  market  contingent  stock  options  with  vesting  conditions  that  required  the 
combination  of  a  liquidity  event,  change  of  control  or  IPO  with  a  market  condition  at  prescribed  levels.  The  modification  removed  the  performance 
condition  and  lowered  the  market  conditions  to  a  volume-weighted  average  per  share  closing  trading  price  of  the  Company’s  common  stock  of  at  least 
$180.00 over a trailing 30-day period for one tranche and at least $360.00 over a trailing 30-day period for the second tranche. The fair value of the options 
on the modification date of $81,000 will be amortized to expense over the implied service periods of 1.46 years to 2.52 years. 

In June 2021, the board of directors modified 3,336 performance and market contingent stock options with vesting conditions that required the combination 
of  a  liquidity  event,  change  of  control  or  IPO  with  a  market  condition  at  prescribed  levels.  The  modification  removed  the  performance  condition  and 
adjusted the market conditions to a date on which the Company attains a valuation of at least one billion dollars measured by the volume-weighted average 
per share closing trading price of the Company’s common stock over a trailing 30-day period. The fair value of the options on the modification date of 
$102,000 will be amortized to expense over the implied service periods of 1.85 years.

As of December 31, 2022, there were 3,336 market contingent stock option awards outstanding with a total fair value of $0.1 million.

2018 Employee Stock Purchase Plan

In March 2018, the Company’s board of directors adopted the Company’s 2018 Employee Stock Purchase Plan (the “2018 ESPP”). The 2018 ESPP was 
approved by the Company’s stockholders in April 2018 and became effective on May 2, 2018. The 2018 ESPP reserved 53,624 shares of common stock for 
issuance  pursuant  to  future  awards,  as  well  as  any  automatic  increases  in  the  number  of  shares  of  the  Company’s  common  stock  reserved  for  future 
issuance under this plan.  

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Under the 2018 ESPP, employees are offered the option to purchase the Company’s common stock at a discount during the offering periods, at semi-annual 
intervals,  with  their  accumulated  payroll  deductions.  The  option  purchase  price  will  be  85%  of  the  lower  of  the  closing  trading  price  per  share  at  the 
beginning of the offering period or at the purchase date. The 2018 ESPP provides for consecutive offering periods and eligible employees may elect to 
withhold up to 15% of their compensation through payroll deductions during the offering period for the purchase of stock. The maximum number of shares 
that may be purchased by any one participant is limited to 15,000 shares in each offering period and $25,000 in fair market value during any calendar year 
per the Internal Revenue Code limits. The first offering period commenced on September 16, 2018. 

Stock-Based Compensation Expense 

The following table sets forth the total stock-based compensation expense for all options granted to employees and nonemployees, including shares sold 
through  the  issuance  of  non-recourse  promissory  notes  which  are  considered  to  be  options  for  accounting  purposes,  and  costs  associated  with  the  2018 
ESPP included in the Company’s statement of operations (in thousands):

Research and development
General and administrative

Total

2022

Year Ended December 31,
2021

2020

  $

  $

3,526     $
5,853  
9,379     $

4,809     $
6,744  
11,553     $

6,563  
7,250  
13,813  

There was no expense related to awards accounted for as liability awards included in stock-based compensation for the years ended December 31, 2022 and 
2021.  Stock-based  compensation  for  the  year  ended  December  31,  2020  included  $0.1  million  of  expense  related  to  awards  accounted  for  as  liability 
awards.

During  the  years  ended  December  31,  2022,  2021  and  2020,  stock-based  compensation  expense  recognized  related  to  nonemployee  options  was  $0.2 
million, $0.4 million and $0.3 million, respectively.

13. Net Loss per Common Share 

Basic net loss per share is calculated by dividing net loss by the weighted-average number of shares outstanding for the period. Diluted net loss per share is 
calculated by dividing net loss by the weighted-average number of shares of common stock and potential dilutive common stock equivalents outstanding 
during the period if the effect is dilutive. 

The calculation of diluted earnings (loss) per share also requires that, to the extent contingencies are satisfied during the period and the presumed issuance 
of additional shares as contingent consideration is dilutive to earnings (loss) per share for the period, adjustments to net income or net loss used in the 
calculation are required to remove the change in fair value of the contingent consideration liability for the period. Likewise, adjustments to the denominator 
are  required  to  reflect  the  related  dilutive  shares.  In  all  periods  presented,  the  Company’s  outstanding  stock  options,  RSUs  (including  PSUs),  early 
exercised common stock subject to future vesting, restricted stock accounted for as options, shares subject to the 2018 ESPP and presumed issuance of 
additional shares as contingent consideration were excluded from the calculation of diluted net loss per share because their effects were antidilutive.

A reconciliation of the numerators and denominators used in computing net loss from continuing operations per share is as follows (in thousands, except 
per share amounts):

2022

Year ended December 31,
2021
(in thousands, except share and per share amounts)

2020

Numerator:
Net loss

Denominator:
Weighted average number of shares outstanding—basic
   and diluted
Net loss per share—basic and diluted

  $

(59,927 )

  $

(60,725 )

  $

(93,844 )

  $

9,494,421  
(6.31 )

  $

5,581,587  
(10.88 )

  $

5,086,489  
(18.45 )

129

 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     
     
   
 
 
   
   
 
Since the Company was in a net loss position for all periods presented, basic net loss per common share is the same as diluted net loss per common share as 
the inclusion of all potential common shares outstanding would have been anti-dilutive. 

Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows: 

Options to purchase common stock
Outstanding warrants to purchase common stock
Early exercised common stock subject to future vesting
RSUs
PSUs
Shares subject to the 2018 ESPP
Total

Year ended December 31,
2021

2022
1,609,938      
6,428,572      
3,336      
146,333      
—      
65,939      
8,254,118      

866,696      
—      
3,336      
199,094      
—      
14,774      
1,083,900      

2020

754,047  
—  
6,674  
283,208  
15,000  
11,138  
1,070,067  

Up  to  3,390  shares  may  be  contingently  issued,  if  certain  performance  conditions  are  met  under  the  Company’s  in-licensing  agreements.  See  Note  5, 
“License Revenue, Agreements and Strategic Investment,” to the Company’s financial statements for additional information.

14. Defined Contribution Plan 

The Company sponsors a 401(k) Plan that stipulates that eligible employees can elect to contribute to the 401(k) Plan, subject to certain limitations, on a 
pretax basis. In January 2019, the Company began to match 4%  of  employees’  salary.  During  the  years  ended  December  31,  2022,  2021  and  2020,  the 
Company recorded matching contributions of $0.4 million, $0.5 million and $0.6 million, respectively.

15. Income Taxes 

The Company has incurred net operating losses for all the periods presented. The Company has not reflected the benefit of any such net operating loss 
carryforwards in the accompanying financial statements. The Company has established a full valuation allowance against its deferred tax assets due to the 
uncertainty surrounding the realization of such assets. All losses to date have been incurred domestically as the Company has no international operations or 
subsidiaries. 

No provision for U.S. income taxes exists due to tax losses incurred in all periods presented. All losses incurred were U.S. based.

The  effective  tax  rate  for  the  years  ended  December  31,  2022,  2021  and  2020  is  different  from  the  federal  statutory  rate  primarily  due  to  the  valuation 
allowance  against  deferred  tax  assets  as  a  result  of  insufficient  sources  of  income.  The  effective  tax  rate  of  the  Company’s  provision  for  income  taxes 
differs from the federal statutory rate as follows: 

Taxes at the U.S. statutory income tax rate
State tax, net of federal benefit
Other
Stock-based compensation
Research and development tax credits
Rate change
ASC 740-10
Change in valuation allowance

Total provision for income taxes

2022

Year ended December 31,
2021

2020

21.0   %  
6.8    
(0.6 )  
(4.9 )  
2.2    
3.5    
(5.6 )  
(22.4 )  

—   %  

21.0   %  
4.4    
(0.4 )  
(1.6 )  
3.2    
3.8    
(4.2 )  
(26.2 )  

—   %  

21.0   %
—    
1.8    
(1.6 )  
2.2    
0.1    
—    
(23.5 )  
—   %

Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting 
purposes and the amounts used for income tax purposes, and (b) operating losses and tax credit carryforwards.

130

 
 
 
 
 
 
 
 
   
   
 
   
   
   
   
   
   
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
The tax effects of significant items comprising the Company’s deferred income taxes are as follows: 

Deferred tax assets:

Federal and state operating loss carryforwards
Research and development tax credits
Stock-based compensation
Accruals and other
Intangibles
Section 174 capitalization research expenses
Charitable contributions
Operating lease liabilities

Total deferred tax assets
Deferred tax liabilities:

Operating lease right-of-use assets
Fixed assets

Total deferred tax liabilities
Valuation allowance
Net deferred tax assets

2022

December 31,

(in thousands)

2021

  $

73,322     $
8,646    
4,589    
587    
5,329    
6,624    
12    
6,908    
106,017    

(4,371 )  
(1,299 )  
(5,670 )  
(100,347 )  

  $

—     $

68,216  
7,356  
5,232  
837  
3,581  
—  
266  
7,608  
93,096  

(4,698 )
(1,500 )
(6,198 )
(86,898 )
—  

The  tax  benefit  of  net  operating  losses,  temporary  differences  and  credit  carryforwards  should  be  recorded  as  an  asset  to  the  extent  that  management 
assesses that their realization is "more likely than not." Realization of the future tax benefits is dependent on the Company's ability to generate sufficient 
taxable income within the carryforward period. Because of the Company's recent history of operating losses, management believes that recognition of the 
deferred tax assets arising from the above-mentioned future tax benefits is currently not likely to be realized and, accordingly, has provided a valuation 
allowance. 

Realization of the net deferred tax assets is dependent upon future taxable income, if any, the amount and timing of which is uncertain. Based on the weight 
of  available  positive  and  negative  objective  evidence,  management  believes  it  more  likely  than  not  that  the  Company’s  deferred  tax  assets  are  not 
realizable. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance. The valuation allowance increased by $13.4 million and 
$15.9 million during the years ended December 31, 2022 and 2021, respectively.

Net operating losses and tax credit carryforwards as of December 31, 2022 are as follows:

Net operating losses, federal (post December 31, 2017)
Net operating losses, federal (pre January 1, 2018)
Net operating losses, state
Research and development tax credits, federal
Research and development tax credits, California

  $

Amount
(in thousands)

284,490    
64,136    
141,720    
8,047    
6,747    

Expiration Years
Do Not Expire
2029 - 2037
2034 - 2042
2034 - 2042
Indefinite

Federal and state laws impose restrictions on the utilization of net operating loss carryforwards and R&D credit carryforwards in the event of a change in 
ownership of the Company, which constitutes an 'ownership change' as defined by Internal Revenue Code Section 382 and 383. The Company experienced 
an ownership change in the past that impacts the availability of its net operating losses and tax credits. The amounts indicated in the above tables reflect the 
reduction of net operating losses and credit carryforwards as a result of previous ownership changes that the Company experienced. In August 2022, the 
Company's Offering may have resulted in an ownership change, which could substantially restrict the ability to utilize existing net operating losses, credits 
and other attribute carryforwards as well. The Company is still analyzing the impact of the Offering relative to Internal Revenue Code Sections 382 and 
383.

The Company determines its uncertain tax positions based on a determination of whether and how much of a tax benefit taken by the Company in its tax 
filings is more likely than not to be sustained upon examination by the relevant income tax authorities.

131

 
 
 
 
 
 
 
   
 
 
 
 
 
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
The following table summarizes the activity related to the Company’s unrecognized tax benefits: 

Gross unrecognized tax benefits at January 1
Additions for tax positions taken in the current year
Reductions for tax positions taken in the prior year
Gross unrecognized tax benefits at December 31

2022

Year ended December 31,
2021
(in thousands)

2020

  $

  $

13,221     $
4,395    
(11 )  
17,605     $

7,142     $
3,457    
2,622    
13,221     $

9,762  
255  
(2,875 )
7,142  

If  recognized,  none  of  the  unrecognized  tax  benefits  as  of  December  31,  2022  and  2021  would  reduce  the  annual  effective  tax  rate,  primarily  due  to 
corresponding adjustments to the valuation allowance. The Company will recognize both accrued interest and penalties related to unrecognized benefits in 
income tax expense. As of December 31, 2022 and 2021, no liability has been recorded for potential interest or penalties. The Company does not expect the 
unrecognized tax benefits to change significantly over the next 12 months. 

The  Company  files  income  tax  returns  in  the  U.S.  federal  jurisdiction  and  Arizona,  California,  Colorado,  Delaware,  Florida,  Massachusetts  and  Rhode 
Island. The Company is not currently under audit by the Internal Revenue Service or other similar state or local authorities. All tax years remain open to 
examination by major taxing jurisdictions to which the Company is subject.

132

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

None.

Item 9A. Controls and Procedures. 

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our chief executive and financial officers, evaluated the effectiveness of our disclosures controls and procedures, 
as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of December 31, 2022. The term “disclosure controls and procedures,” as defined 
in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information 
required  to  be  disclosed  by  a  company  in  the  reports  that  it  files  or  submits  under  the  Exchange  Act  is  recorded,  processed,  summarized,  and  reported 
within  the  time  periods  specified  in  the  SEC’s  rules  and  forms.  Disclosure  controls  and  procedures  include,  without  limitation,  controls  and  procedures 
designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and 
communicated to the company’s management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions 
regarding  required  disclosure.  Management  recognizes  that  any  controls  and  procedures,  no  matter  how  well  designed  and  operated,  can  provide  only 
reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible 
controls and procedures. Based on the evaluation of our disclosure controls and procedures as of December 31, 2022, our chief executive officer and chief 
financial officer concluded that, as of such date, our disclosure controls and procedures were effective at a reasonable assurance level.

Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-
15(f) under the Securities Exchange Act of 1934. Our internal control over financial reporting is designed to provide reasonable assurance regarding the 
reliability  of  financial  reporting  and  the  preparation  of  financial  statements  for  external  purposes  in  accordance  with  generally  accepted  accounting 
principles in the United States and includes those policies and procedures that:

•

•

•

Pertain to the maintenance of records that accurately and fairly reflect in reasonable detail the transactions and dispositions of the assets of our 
company;

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with 
generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our 
management and directors; and

Provide reasonable assurances regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could 
have a material adverse effect on our financial statements.

Our  management  assessed  the  effectiveness  of  our  internal  control  over  financial  reporting  as  of  December  31,  2022.  In  making  this  assessment, 
management  used  the  criteria  set  forth  by  the  Committee  of  Sponsoring  Organizations  of  the  Treadway  Commission,  or  COSO,  in  Internal  Control-
Integrated Framework (2013 framework). Based on our assessment, management concluded our internal control over financial reporting was effective as of 
December 31, 2022, based on the COSO criteria.

Attestation Report of the Registered Public Accounting Firm

This Annual Report on Form 10-K does not include an attestation report of our registered public accounting firm due to an exemption established by the 
JOBS Act for “emerging growth companies.”

Inherent Limitations on Effectiveness of Controls and Procedures

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed 
and  operated,  can  provide  only  reasonable  assurance  of  achieving  the  desired  control  objectives.  In  addition,  the  design  of  disclosure  controls  and 
procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible 
controls and procedures relative to their costs.

133

 
Changes in Internal Control over Financial Reporting

Management  determined  that,  as  of  December  31,  2022,  there  were  no  changes  in  our  internal  control  over  financial  reporting  that  occurred  during  the 
fiscal quarter then ended that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information. 

None.

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

Not Applicable.

134

 
Item 10. Directors, Executive Officers and Corporate Governance. 

PART III 

Information  required  by  this  Item  is  incorporated  herein  by  reference  to  the  sections  titled  “Executive  Officers,”  “Election  of  Directors,”  “Corporate 
Governance”  and  “Section  16(a)  Beneficial  Ownership  and  Reporting  Compliance”  in  our  Definitive  Proxy  Statement  with  respect  to  our  2023  Annual 
Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K.

Item 11. Executive Compensation. 

Information  required  by  this  Item  is  incorporated  herein  by  reference  to  the  section  titled  “Executive  Compensation,”  “Director  Compensation”  and 
“Corporate Governance”  in our Definitive Proxy Statement with respect to our 2023 Annual Meeting of Stockholders to be filed with the SEC within 120 
days after the end of the fiscal year covered by this Annual Report on Form 10-K.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. 

Information  required  by  this  Item  is  incorporated  herein  by  reference  to  the  section  titled  “Security  Ownership  of  Certain  Beneficial  Owners  and 
Management” and “Equity Compensation Plan Information” in our Definitive Proxy Statement with respect to our 2023 Annual Meeting of Stockholders to 
be filed with the SEC within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K.

Item 13. Certain Relationships and Related Transactions, and Director Independence. 

Information  required  by  this  Item  is  incorporated  herein  by  reference  to  the  section  titled  “Certain  Relationships  and  Related  Party  Transactions”  and 
“Corporate Governance” in our Definitive Proxy Statement with respect to our 2023 Annual Meeting of Stockholders to be filed with the SEC within 120 
days after the end of the fiscal year covered by this Annual Report on Form 10-K.

Item 14. Principal Accounting Fees and Services. 

Information  required  by  this  Item  is  incorporated  herein  by  reference  to  the  section  titled  “Ratification  of  Selection  of  Independent  Registered  Public 
Accounting Firm” in our Definitive Proxy Statement with respect to our 2023 Annual Meeting of Stockholders to be filed with the SEC within 120 days 
after the end of the fiscal year covered by this Annual Report on Form 10-K.

135

 
Item 15. Exhibits, Financial Statement Schedules. 

(a)  The following documents are filed as part of this report:

1. Financial Statements

PART IV 

See Index to Financial Statements in Part II Item 8 of this Annual Report on Form 10-K.

2. Financial Statement Schedules

All  schedules  are  omitted  because  they  are  not  applicable  or  the  required  information  is  shown  in  the  financial  statements  or  notes 
thereto.

3. Exhibits

136

 
Exhibit Index

Exhibit
Number

Description

Form

Number

Filing Date

Filed 
Herewith

Incorporated by Reference

3.1
3.2

3.3
4.1
4.2
4.3
4.4

4.5

  Amended and Restated Certificate of Incorporation of Unity Biotechnology, Inc.  
  Certificate of Amendment to Amended and Restated Certificate of 

Incorporation of Unity Biotechnology, Inc.

  Amended and Restated Bylaws of Unity Biotechnology, Inc.
  Reference is made to exhibits 3.1 through 3.2.
  Form of Common Stock Certificate.
  Form of Warrant.
  Amended and Restated Investors’ Rights Agreement, dated as of March 15, 

2018, by and among Unity Biotechnology, Inc. and the investors party thereto.

  Description of Unity’s Securities Registered Pursuant to Section 12 of the 

Securities Exchange Act of 1934. 

8-K
8-K

8-K

10-Q  
8-K
S-1

3.1
3.1

3.2

4.2
4.1
4.3

`

5-7-18
10-19-22

5-7-18

11-8-22
8-22-22
4-5-18

X

10.1(a)

  Lease Agreement, dated as of May  13, 2016, by and between Unity 

Biotechnology, Inc. and BMR-Bayshore Boulevard L.P.

10.1(b)

  First Amendment to Lease Agreement, dated as of May 23, 2017, by and 
between Unity Biotechnology, Inc. and BMR-Bayshore Boulevard L.P.

10.2(a)

  Space License Agreement, dated as of October 20, 2016, by and between Unity 

10.2(b)

10.2(c)

10.3(a)#
10.3(b)#
10.4(a)#
10.4(b)#

Biotechnology, Inc. and BMR-Bayshore Boulevard L.P.

  First Amendment to Space License Agreement, dated as of December 5, 2016, 
by and between Unity Biotechnology, Inc. and BMR-Bayshore Boulevard L.P.
  Second Amendment to Space License Agreement, dated as of January 30, 2017, 
by and between Unity Biotechnology, Inc. and BMR-Bayshore Boulevard L.P.

  2013 Equity Incentive Plan.
  Form of Stock Option Agreement under 2013 Equity Incentive Plan.
  2018 Incentive Award Plan.
  Form of Stock Option Grant Notice and Stock Option Agreement under the 

2018 Incentive Award Plan.

10.4(c)#

  Form of Restricted Stock Award Grant Notice and Restricted Stock Award 

Agreement under the 2018 Incentive Award Plan.

10.4(d)#

  Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit 

Award Agreement under the 2018 Incentive Award Plan.

S-1

S-1

S-1

S-1

S-1

S-1
S-1
S-1
S-1

S-1

S-1

10.1(a)

4-5-18

10.1(b)

4-5-18

10.2(a)

4-5-18

10.2(b)

4-5-18

10.2(c)

4-5-18

10.3(a)
10.3(b)
10.4(a)
10.4(b)

4-5-18
4-5-18
4-23-18
4-5-18

10.4(c)

4-5-18

10.4(d)

4-5-18

10.5#
10.6#

10.7#
10.8#

10.9+

  2018 Employee Stock Purchase Plan.
  Amended and Restated Non-Employee Director Compensation Program 

S-1
10-K  

10.5
10.6

(Effective January 1, 2019)

  Form of Indemnification Agreement for directors and officers.
  Employment Agreement, dated January 29, 2018, by and between Unity 

S-1
S-1

10.7
10.11

Biotechnology, Inc. and Jamie Dananberg.

4-23-18
3-6-19

4-5-18
4-5-18

  Compound Library and Option Agreement, dated as of February 2, 2016, by and 

10-K  

10.14

3-23-21

between Ascentage Pharma Group Corp. Ltd. and Unity Biotechnology, Inc.

137

 
 
 
 
 
 
  
 
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
10.10+

  APG1252 License Agreement, dated as of February 2, 2016, by and between 

10-K  

10.15

3-23-21

Ascentage Pharma Group Corp. Ltd. and Unity Biotechnology, Inc.

10.11†

  Research Services Agreement, dated as of February 2, 2016, by and between 

S-1

10.16

4-5-18

Ascentage Pharma Group Corp. Ltd. and Unity Biotechnology, Inc.

10.12+

  Amendment to APG1252 License Agreement, dated as of February 2, 2016, by 

10-K  

10.17

3-23-21

and between Ascentage Pharma Group Corp. Ltd. 

10.13+

  Amendment to Compound Library and Option Agreement, dated as of February 

10-K  

10.18

3-23-21

2, 2016, by and between Ascentage Pharma Group Corp. Ltd. and Unity 
Biotechnology, Inc.

10.14(a)+

  Exclusive License Agreement, dated as of June 28, 2013, by and between the 

10-K  

10.19(a)

3-23-21

Mayo Foundation for Medical Education and Research and Unity 
Biotechnology, Inc.

10.14(b)+

  Amendment No. 1 to Exclusive License Agreement, dated as of September 10, 

10-K  

10.19(b)

3-23-21

2014, by and between the Mayo Foundation for Medical Education and 
Research and Unity Biotechnology, Inc.

10.14(c)†

  Amendment No. 2 to Exclusive License Agreement, dated as of November 17, 

S-1

10.19(c)

4-23-18

2014, by and between the Mayo Foundation for Medical Education and 
Research and Unity Biotechnology, Inc.

10.14(d)+

  Amendment No. 3 to Exclusive License Agreement, dated as of May 5, 2015, 

10-K  

10.19(d)

3-23-21

by and between the Mayo Foundation for Medical Education and Research and 
Unity Biotechnology, Inc.

10.14(e)+

  Amendment No. 4 to Exclusive License Agreement, dated as of September 15, 

10-K  

10.19(e)

3-23-21

2016, by and between the Mayo Foundation for Medical Education and 
Research and Unity Biotechnology, Inc.

10.14(f)+

  Addendum to Amendment No. 4 to Exclusive License Agreement, dated as of 

10-K  

10.19(f)

3-23-21

September 15, 2016, by and between the Mayo Foundation for Medical 
Education and Research and Unity Biotechnology, Inc.

10.14(g)+

  Amendment No. 5 to Exclusive License Agreement, dated as of October 17, 

10-K  

10.19(g)

3-23-21

2016, by and between the Mayo Foundation for Medical Education and 
Research and Unity Biotechnology, Inc.

10.15+

  Amended and Restated License Agreement, dated as of January 27, 2017, by 

10-K  

10.20

3-23-21

and between the Buck Institute for Research on Aging and Unity Biotechnology, 
Inc.

10.16††

  License Agreement for APG1197, dated as of January 2, 2019, by and between 

10-K  

10.22

3-6-19

Ascentage Pharma Group Corp. Ltd. And Unity Biotechnology, Inc.

10.17

  Lease Agreement, dated as of February 28, 2019, by and between Unity 

10-K  

10.23

3-6-19

10.18††††

10.19†††

10.20††††

Biotechnology, Inc. and Bayside Area Development, LLC

  First Amendment to Compound License Agreement for APG1197, dated as of 
November 19, 2019, by and between Ascentage Pharma Group Corp. Ltd. and 
Unity Biotechnology, Inc.

  Second Amendment to APG1252 License Agreement, dated as of November 
19, 2019, by and between Ascentage Pharma Group Corp. Ltd. and Unity 
Biotechnology, Inc.

  Second Amendment to Compound Library and Option Agreement, dated as of 
January 8, 2020, by and between Ascentage Pharma Group Corp. Ltd. and 
Unity Biotechnology, Inc.

138

8-K

10.1

11-25-19

10-K  

10.25

3-11-20

10-K  

10.26

3-11-20

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
10.21#

  Amendment to Employment Agreement, dated March 9, 2020, by and between 

10-K  

10.27

3-11-20

Unity Biotechnology, Inc. and Nathaniel E. David.

10.22#

  Amendment to Employment Agreement, dated March 9, 2020, by and between 

10-K  

10.29

3-11-20

Unity Biotechnology, Inc. and Jamie Dananberg.

10.23#

  Employment Agreement, dated March 30, 2020, by and between Unity 

8-K

10.1

3-30-20

Biotechnology, Inc. and Anirvan Ghosh.

10.24#

  Amended and Restated Non-Employee Director Compensation Program 

10-Q  

10.2

5-7-20

(effective as of March 30, 2020)

10.25†††

  Third Amendment to Compound License Agreement for APG-1197, dated June 

8-K

10.1

7-1-20

29, 2020, by and between Ascentage Pharma Group Corp. Ltd. and Unity 
Biotechnology, Inc. 

10.26#

  Employment Agreement, dated August 1, 2020, by and between Unity 

10-Q  

10.2

11-4-20

Biotechnology, Inc. and Lynne Sullivan.

10.27#

  Amendment to Employment Agreement, dated September 1, 2020, by and 

10-Q  

10.3

11-4-20

between Unity Biotechnology, Inc. and Lynne Sullivan.

10.28†††

  Loan and Security Agreement, dated August 3, 2020, between Unity 

8-K

Biotechnology, Inc. and Hercules Capital. Inc.

10.29

10.30

10.31

10.32

10.33

10.34

23.1
24.1
  31.1

  Amendment No. 1 to Loan and Security Agreement, dated December 15, 2021, 

8-K

by and between the Company and Hercules Capital, Inc.

  Purchase Agreement, dated September 29, 2021, by and between the Unity 

Biotechnology, Inc. and Lincoln Park Capital Fund, LLC.

  Registration Rights Agreement, dated September 29, 2021, by and between 

Unity Biotechnology and Lincoln Park Capital Fund, LLC.

  Sales Agreement, dated March 15, 2022, by and between Unity Biotechnology, 

Inc. and Cowen and Company , LLC.

8-K

8-K

S-3

  Amendment No. 1 to Sales Agreement, dated August 17, 2022, by and between 

8-K

Unity Biotechnology, Inc. and Cowen and Company, LLC.

  Sales Agreement, dated October 14, 2022, by and between Unity 

S-3

Biotechnology, Inc. and Cowen and Company, LLC.

  Consent of Independent Registered Public Accounting Firm
  Power of Attorney. Reference is made to the signature page.
   Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 

15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to 
Section 302 of the Sarbanes-Oxley Act of 2002.

  31.2

   Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 

15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to 
Section 302 of the Sarbanes-Oxley Act of 2002.

  32.1**

   Certification of Principal Executive Officer and Principal Financial Officer 

Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the 
Sarbanes-Oxley Act of 2002.

101.INS

   Inline XBRL Instance Document – the instance document does not appear in the 

Interactive Data File because its XBRL tags are embedded within the Inline 
XBRL document.

101.SCH
101.CAL

  Inline XBRL Taxonomy Extension Schema Document
  Inline XBRL Taxonomy Extension Calculation Linkbase Document

139

10.1

10.1

10.1

8-4-20

12-15-21

9-29-21

10.2

9-29-21

1.2

1.1

1.2

3-15-22

8-19-22

10-14-22

X
X
X

X

X

X

X
X

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 
 
 
 
   
   
   
   
 
   
   
   
 
   
   
   
 
   
   
   
 
   
   
   
 
   
   
   
 
101.DEF
101.LAB
101.PRE
104

  Inline XBRL Taxonomy Extension Definition Linkbase Document
  Inline XBRL Taxonomy Extension Label Linkbase Document
  Inline XBRL Taxonomy Extension Presentation Linkbase Document
  Cover Page Interactive Data File (formatted as inline XBRL and contained in 

Exhibit 101)

X
X
X
X

† Confidential treatment has been granted for certain information contained in this exhibit. Such information has been omitted and filed separately with the 
Securities and Exchange Commission.
†† Portions of this exhibit (indicated by asterisks) have been omitted pursuant to a request for confidential treatment filed separately with the Securities and 
Exchange Commission.
† † †   Portions  of  this  exhibit  (indicated  by  asterisks)  have  been  omitted  pursuant  to  Regulation  S-K,  Item  601(b)(10).  Such  omitted  information  is  not 
material and would likely cause competitive harm to the registrant if publicly disclosed.
† † † †   Portions  of  this  exhibit  (indicated  by  asterisks)  have  been  omitted  pursuant  to  Regulation  S-K,  Item  601(b)(10).  Such  omitted  information  is  not 
material and would likely cause competitive harm to the registrant if publicly disclosed. Additionally, schedules and attachments to this exhibit have been 
omitted pursuant to Regulation S-K, Item 601(a)(5).
+ Certain confidential portions of this exhibit have been omitted from this exhibit in accordance with Regulation S-K 601(b)(10). Exhibit being refiled 
upon expiration of confidential treatment previously granted by the SEC.
# Indicates management contract or compensatory plan.
** The certification attached as Exhibit 32.1 that accompanies this Annual Report on Form 10-K is not deemed filed with the Securities and Exchange 
Commission and is not to be incorporated by reference into any filing of Unity Biotechnology, Inc. under the Securities Act of 1933, as amended, or the 
Securities  Exchange  Act  of  1934,  as  amended,  whether  made  before  or  after  the  date  of  this  Annual  Report  on  Form  10-K,  irrespective  of  any  general 
incorporation language contained in such filing.

Item 16. Form 10-K Summary. 

None.

140

 
   
   
   
 
   
   
   
 
   
   
   
 
   
   
   
 
 
 
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this 

Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized.

SIGNATURES

Date: March 15, 2023

Unity Biotechnology, Inc.

By:

/s/ Anirvan Ghosh
Anirvan Ghosh, Ph.D.
Chief Executive Officer

POWER OF ATTORNEY

KNOW  ALL  PERSONS  BY  THESE  PRESENTS,  that  each  person  whose  signature  appears  below  constitutes  and  appoints  each  of  Anirvan 
Ghosh, Alexander Nguyen, and Lynne Sullivan his or her true and lawful attorney-in-fact and agent, with full power of substitution, for him or her and in 
his or her name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with 
all exhibits thereto, and other documents in connection therewith, with the U.S. Securities and Exchange Commission, granting unto said attorneys-in-fact 
and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection 
therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming that all said attorneys-in-fact and 
agents, or their, his or her substitutes or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant  to  the  requirements  of  the  Securities  Exchange  Act  of  1934,  this  Annual  Report  on  Form  10-K  has  been  signed  by  the  following

persons on behalf of the Registrant in the capacities and on the dates indicated.

Name

Title

Date

/s/ Anirvan Ghosh

Anirvan Ghosh, Ph.D.

Chief Executive Officer and Director
(Principal Executive Officer) 

/s/ Lynne Sullivan

Lynne Sullivan

 Chief Financial Officer
(Principal Financial and Accounting Officer)

March 15, 2023

March 15, 2023

/s/ Keith R. Leonard Jr.

    Chairman

March 15, 2023

Keith R. Leonard Jr.

/s/ Paul L. Berns

    Director

March 15, 2023

Paul L. Berns

/s/ Nathaniel E. David

    Director

March 15, 2023

Nathaniel E. David, Ph. D.

/s/ Gilmore O’Neill

    Director

March 15, 2023

Gilmore O’Neill, M.B.

/s/ Margo Roberts

    Director

March 15, 2023

Margo Roberts, Ph.D.

/s/ Michael P. Samar
Michael P. Samar

    Director

/s/ Camille D. Samuels

    Director

Camille D. Samuels

141

March 15, 2023

March 15, 2023

 
 
  
  
  
  
  
  
  
  
 
 
 
 
  
 
 
  
  
  
 
 
  
  
 
 
  
 
 
 
  
     
 
 
 
  
 
 
  
 
 
 
 
 
 
 
 
 
 
     
 
 
 
  
     
  
 
 
 
     
 
 
 
  
     
  
 
 
 
     
 
 
 
  
     
  
 
 
 
     
 
 
 
  
     
  
 
 
 
     
 
 
 
  
     
  
 
 
 
   
 
 
 
 
 
 
 
 
 
     
 
 
 
 
Exhibit 4.5

DESCRIPTION OF UNITY’S SECURITIES REGISTERED PURSUANT TO
SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934

As  of  December  31,  2022,  Unity  Biotechnology,  Inc.  had  common  stock,  $0.0001  par  value  per  share,  registered  under  Section  12  of  the 
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and listed on The Nasdaq Global Select Market under the trading symbol “UBX.” 
References to “UBX,” the “Company,” “we,” “us” or “our” refer to Unity Biotechnology, Inc.

The following description of our securities is a summary. This summary is subject to the General Corporation Law of the State of Delaware (the 
“DGCL”) and the complete text of our amended and restated certificate of incorporation (the “certificate of incorporation”), certificate of amendment to our 
amended and restated certificate of incorporation (the “certificate of amendment”) and amended and restated bylaws (the “bylaws”) and is qualified in its 
entirety by reference to the full text of our certificate of incorporation, certificate of amendment and bylaws, filed as Exhibits 3.1, 3.2 and 3.3, respectively, 
to our Annual Report on Form 10-K. We encourage you to read that law and those documents carefully.

On  October  19,  2022,  we  filed  the  certificate  of  amendment  to  effect  a  1-for-10  reverse  stock  split  of  our  common  stock  (the  “Reverse  Stock 
Split”). The Reverse Stock Split became effective at 5:00 p.m., Eastern time, on October 19, 2022. As a result of the Reverse Stock Split, every 10 shares 
of our issued and outstanding common stock were automatically reclassified into one new share of common stock. The Reverse Stock Split did not modify 
any rights or preferences of the shares of our common stock. No fractional shares were issued as a result of the Reverse Stock Split. Stockholders who 
otherwise would have been entitled to receive fractional shares of common stock were entitled to receive cash for such fractional share based upon the 
closing sales price of the common stock as reported on The Nasdaq Global Select Market as of October 19, 2022. Proportionate adjustments were made to 
the exercise prices and the number of shares underlying our outstanding equity awards, as applicable, and warrants exercisable for shares of common stock, 
as well as to the number of shares issuable under our equity incentive plans and certain existing agreements. The following description of the terms of our 
capital stock gives effect to the Reverse Stock Split, except as otherwise indicated.

DESCRIPTION OF COMMON STOCK

Common Stock

General

Our authorized capital stock consists of 300,000,000 shares of common stock, $0.0001 par value per share.

Voting Rights

Each  holder  of  our  common  stock  is  entitled  to  one  vote  for  each  share  on  all  matters  submitted  to  a  vote  of  the  stockholders,  including  the 
election of directors. Our stockholders do not have cumulative voting rights in the election of directors. Accordingly, holders of a majority of the voting 
shares are able to elect all of the directors. In addition, the affirmative vote of holders of sixty-six and two-thirds percent (66 2/3%) of the voting power of 
all of the then outstanding voting stock is required to take certain actions, including amending certain provisions of our amended and restated certificate of 
incorporation, such as the provisions relating to amending our amended and restated bylaws, the classified board and director liability.

Dividends

Subject  to  preferences  that  may  be  applicable  to  any  then  outstanding  preferred  stock,  holders  of  our  common  stock  are  entitled  to  receive 

dividends, if any, as may be declared from time to time by our board of directors out of legally available funds.

Liquidation

In the event of our liquidation, dissolution or winding up, holders of our common stock will be entitled to share ratably in the net assets legally 
available for distribution to stockholders after the payment of all of our debts and other liabilities and the satisfaction of any liquidation preference granted 
to the holders of any then outstanding shares of preferred stock.

 
 
Rights and Preferences

Holders  of  our  common  stock  have  no  preemptive,  conversion,  subscription  or  other  rights,  and  there  are  no  redemption  or  sinking  fund 
provisions applicable to our common stock. The rights, preferences and privileges of the holders of our common stock are subject to and may be adversely 
affected by the rights of the holders of shares of any series of our preferred stock that we may designate in the future.

Anti-Takeover Effects of Provisions

Certain provisions of Delaware law and our certificate of incorporation and bylaws contain provisions that could make the following transactions 
more  difficult:  acquisition  of  us  by  means  of  a  tender  offer;  acquisition  of  us  by  means  of  a  proxy  contest  or  otherwise;  or  removal  of  our  incumbent 
officers  and  directors.  It  is  possible  that  these  provisions  could  make  it  more  difficult  to  accomplish  or  could  deter  transactions  that  stockholders  may 
otherwise consider to be in their best interest or in our best interests, including transactions that might result in a premium over the market price for our 
shares.

These provisions, summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are
also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of increased 
protection  of  our  potential  ability  to  negotiate  with  the  proponent  of  an  unfriendly  or  unsolicited  proposal  to  acquire  or  restructure  us  outweigh  the 
disadvantages of discouraging these proposals because negotiation of these proposals could result in an improvement of their terms.

Delaware Anti-Takeover Statute

We  are  subject  to  Section  203  of  the  DGCL,  which  prohibits  persons  deemed  “interested  stockholders”  from  engaging  in  a  “business 
combination”  with  a  publicly-held  Delaware  corporation  for  three  years  following  the  date  these  persons  become  interested  stockholders  unless  the 
business  combination  is,  or  the  transaction  in  which  the  person  became  an  interested  stockholder  was,  approved  in  a  prescribed  manner  or  another 
prescribed exception applies. Generally, an “interested stockholder” is a person who, together with affiliates and associates, owns, or within three years 
prior  to  the  determination  of  interested  stockholder  status  did  own,  15%  or  more  of  a  corporation’s  voting  stock.  Generally,  a  “business  combination” 
includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. The existence of this provision may 
have an anti-takeover effect with respect to transactions not approved in advance by the board of directors, such as discouraging takeover attempts that 
might result in a premium over the market price of our common stock.

Undesignated Preferred Stock

Under our certificate of incorporation, our board of directors has the authority, without further action by our stockholders, to designate and issue 
up to 10,000,000 shares of preferred stock, par value $0.0001 per share, in one or more series and to fix the rights, preferences, privileges and restrictions 
thereof.  These  rights,  preferences  and  privileges  could  include  dividend  rights,  conversion  rights,  voting  rights,  terms  of  redemption,  liquidation 
preferences, sinking fund terms and the number of shares constituting, or the designation of, such series, any or all of which may be greater than the rights 
of our common stock. The issuance of our preferred stock could adversely affect the voting power of holders of common stock and the likelihood that such 
holders will receive dividend payments and payments upon our liquidation. The ability to authorize undesignated preferred stock makes it possible for our 
board of directors to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to change control of us. 
These and other provisions may have the effect of deterring hostile takeovers or delaying changes in control or management of our company.

Special Stockholder Meetings

Our  bylaws  provide  that  a  special  meeting  of  stockholders  may  be  called  at  any  time  by  our  board  of  directors,  or  our  President  or  Chief 
Executive Officer or President (in the absence of a Chief Executive Officer), but such special meetings may not be called by the stockholders or any other 
person or persons.

Classified Board; Election and Removal of Directors; Filling Vacancies

Our board of directors is divided into three classes. The directors in each class serve for a three-year term, with one class being elected each year 
by our stockholders, with staggered three-year terms. Only one class of directors will be elected at each annual meeting of our stockholders, with the other 
classes continuing for the remainder of their respective three-year terms. Because our stockholders do not have cumulative voting rights, our stockholders 
holding a majority of the shares of common stock outstanding will be able to elect all of our directors. Furthermore, the size of the board of directors shall 
be determined from time to time exclusively by the board of directors pursuant to a 

 
resolution adopted by the board of directors, provided the board of directors may not consist of fewer than one member. Our certificate of incorporation 
provides for the removal of any of our directors only for cause and requires a stockholder vote by the holders of at least sixty-six and two-thirds percent (66 
2/3%) of the voting power of the then outstanding shares of voting stock. Furthermore, any vacancy on our board of directors, including a vacancy resulting 
from an increase in the size of the board, may be filled only by a majority vote of the board of directors then in office, although less than a quorum, or by a 
sole remaining director. This system of electing and removing directors and filling vacancies may tend to discourage a third party from making a tender 
offer or otherwise attempting to obtain control of us, because it generally makes it more difficult for stockholders to replace a majority of the directors.

Amendment of the Certificate of Incorporation and Bylaws

The amendment of any of the above provisions in our certificate of incorporation, except for the provision making it possible for our board of 
directors to issue undesignated preferred stock, would require approval by holders of at least sixty-six and two-thirds percent (66 2/3%) of the voting power 
of the then outstanding voting stock, voting together as a single class. Subject to limitations set forth in the bylaws or the certificate of incorporation, the 
board  is  expressly  empowered  to  adopt,  amend  or  repeal  the  bylaws.  Stockholders  shall  have  the  power  to  amend  the  bylaws provided  that  any  such 
amendment would require approval by holders of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the then outstanding voting 
stock, voting together as a single class.

The  provisions  of  the  DGCL,  our  certificate  of  incorporation  and  bylaws  could  have  the  effect  of  discouraging  others  from  attempting  hostile 
takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock that often result from actual or 
rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in our management. It is possible that these provisions 
could make it more difficult to accomplish transactions that stockholders may otherwise deem to be in their best interests.

Limitations of Liability and Indemnification Matters

Our certificate of incorporation contains provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by 
Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as 
directors, except liability for:

•

•

•

•

any breach of the director’s duty of loyalty to us or our stockholders;

any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL; or

any transaction from which the director derived an improper personal benefit.

Each of our certificate of incorporation and bylaws provides that we are required to indemnify our directors and officers, in each case to the fullest 
extent permitted by Delaware law. Our bylaws also obligate us to advance expenses incurred by a director or officer in advance of the final disposition of 
any action or proceeding, and permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or 
her actions in that capacity regardless of whether we would otherwise be permitted to indemnify him or her under Delaware law. We have entered and 
expect to continue to enter into agreements to indemnify our directors, executive officers and other employees as determined by our board of directors. 
With specified exceptions, these agreements provide for indemnification for related expenses including, among other things, attorneys’ fees, judgments, 
fines and settlement amounts incurred by any of these individuals in any action or proceeding. We believe that these bylaw provisions and indemnification 
agreements are necessary to attract and retain qualified persons as directors and officers. We also maintain directors’ and officers’ liability insurance.

The  limitation  of  liability  and  indemnification  provisions  in  our  certificate  of  incorporation  and  bylaws  may  discourage  stockholders  from 
bringing a lawsuit against our directors and officers for breach of their fiduciary duty. They may also reduce the likelihood of derivative litigation against 
our directors and officers, even though an action, if successful, might benefit us and our stockholders. Further, a stockholder’s investment may be adversely 
affected to the extent that we pay the costs of settlement and damages.

Transfer Agent and Registrar

The transfer agent and registrar for our common stock is Computershare Trust Company, N.A. The transfer agent and registrar’s address is 250 

Royall Street, Canton, Massachusetts 02021.

 
  
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 

Exhibit 23.1

We consent to the incorporation by reference in the following Registration Statements:

(1) Registration Statement (Form S-3 No. 333-267886) of Unity Biotechnology, Inc.,

(2) Registration Statement (Form S-3 No. 333-263574) of Unity Biotechnology, Inc.,

(3) Registration Statement (Form S-8 No. 333-263576) pertaining to the 2018 Incentive Award Plan and 2018 Employee Stock Purchase Plan of 

Unity Biotechnology, Inc.,

(4) Registration Statement (Form S-8 No. 333-254619) pertaining to the 2018 Incentive Award Plan and 2018 Employee Stock Purchase Plan of 

Unity Biotechnology, Inc.,

(5) Registration Statement (Form S-8 No. 333-250926) pertaining to the 2020 Employment Inducement Incentive Award Plan, as amended of Unity 

Biotechnology, Inc.,

(6) Registration Statement (Form S-8 No. 333-237474) pertaining to the 2020 Employment Inducement Incentive Plan of Unity Biotechnology, Inc.,

(7) Registration Statement (Form S-8 No. 333-237088) pertaining to the 2018 Incentive Award Plan and 2018 Employee Stock Purchase Plan of 

Unity Biotechnology, Inc.,

(8) Registration Statement (Form S-8 No. 333-230086) pertaining to the 2018 Incentive Award Plan and 2018 Employee Stock Purchase Plan of 

Unity Biotechnology, Inc., and

(9) Registration Statement (Form S-8 No. 333-224726) pertaining to the 2013 Equity Incentive Plan, 2018 Incentive Award Plan, and 2018 

Employee Stock Purchase Plan of Unity Biotechnology, Inc.

of our report dated March 15, 2023, with respect to the financial statements of Unity Biotechnology, Inc. included in this Annual Report (Form 10-K) of 
Unity Biotechnology, Inc. for the year ended December 31, 2022.

/s/ Ernst & Young LLP

San Mateo, California 
March 15, 2023

 
 
 
 
Exhibit 31.1

CERTIFICATION PURSUANT TO
RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Anirvan Ghosh, certify that:

1.

2.

3.

4.

I have reviewed this Annual Report on Form 10-K of Unity Biotechnology, Inc. for the year ended December 31, 2022;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the 
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this 
report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the 
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in 
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:

(a)

(b)

(c)

(d)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to 
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those 
entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our 
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for 
external purposes in accordance with generally accepted accounting principles;

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the 
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent 
fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to 
materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to 
the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)

(b)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are 
reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal 
control over financial reporting.

Date: March 15, 2023

   By:

/s/ Anirvan Ghosh
Anirvan Ghosh, Ph.D.
Chief Executive Officer
(Principal Executive Officer)

 
 
  
     
  
     
 
 
Exhibit 31.2

CERTIFICATION PURSUANT TO
RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Lynne Sullivan, certify that:

1.

2.

3.

4.

I have reviewed this Annual Report on Form 10-K of Unity Biotechnology, Inc. for the year ended December 31, 2022;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the 
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this 
report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the 
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in 
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:

(a)

(b)

(c)

(d)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to 
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those 
entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our 
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for 
external purposes in accordance with generally accepted accounting principles;

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the 
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent 
fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to 
materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to 
the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)

(b)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are 
reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal 
control over financial reporting.

Date: March 15, 2023

   By:

/s/ Lynne Sullivan
Lynne Sullivan
Chief Financial Officer
(Principal Financial and Accounting Officer)

 
 
  
     
  
     
 
 
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Exhibit 32.1

In connection with the Annual Report of Unity Biotechnology, Inc. (the “Company”) on Form 10-K for the year ending December 31, 2022 as filed 

with the Securities and Exchange Commission on the date hereof (the “Report”), I, Anirvan Ghosh, Chief Executive Officer of the Company, and Lynne 
Sullivan, Chief Financial Officer of the Company, do each hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-
Oxley Act of 2002, that:

(1)

(2)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the 
Company.

Date: March 15, 2023

Date: March 15, 2023

   By:

   By:

/s/ Anirvan Ghosh
Anirvan Ghosh, Ph.D. 
Chief Executive Officer
(Principal Executive Officer)

/s/ Lynne Sullivan
Lynne Sullivan
Chief Financial Officer
(Principal Financial and Accounting Officer)