You are cordially invited to attend the special meeting of stockholders (the “Special Meeting”) of Solid Biosciences Inc. (the “Company” or “Solid”), which will be held on    ,    , 2022 at    , Eastern Time. The Special Meeting will be held by a virtual-only format, solely by means of remote communication.

On September 29, 2022, Solid entered into an Agreement and Plan of Merger (the “Merger Agreement”), with AavantiBio, Inc. (“AavantiBio”), a privately-held gene therapy company focused on advancing innovative gene therapies in areas of high unmet medical need, including a lead program in Friedreich’s Ataxia, a rare inherited genetic disease that causes cardiac and central nervous system dysfunction. The Merger Agreement provides for the acquisition of AavantiBio by Solid through the merger of a wholly owned subsidiary of Solid into AavantiBio, with AavantiBio surviving as a wholly owned subsidiary of Solid (the “Acquisition”). The Acquisition will add to Solid’s pipeline of assets, led by Solid’s SGT-003, a differentiated gene transfer candidate, for the treatment of Duchenne muscular dystrophy. Following the closing of the Acquisition, Solid will continue to operate under the name “Solid Biosciences Inc.” and will continue to trade under the ticker symbol “SLDB”.

The aggregate consideration payable by Solid to the former stockholders of AavantiBio in the Acquisition will be (i) $1,000 of cash plus (ii) a number of shares of Solid’s common stock (the “Stock Consideration”) (rounded to the nearest whole share) equal to fifteen percent (15%) of outstanding shares of Solid’s common stock as of immediately following the closing of the Acquisition (and for the avoidance of doubt, before giving effect to the issuance of any securities pursuant to the Private Placement (as defined below)), calculated on a fully diluted basis using the treasury stock method (including, for clarity, calculated by disregarding any out-of-the-money outstanding stock options of Solid and treating any awards or grants that are subject to vesting at such time as being fully vested, settled and outstanding at such time to the extent such awards are not out-of-the-money), subject to certain adjustments based on the amount of closing indebtedness of AavantiBio as of the closing of the Acquisition. The Acquisition and the Merger Agreement are more fully described in the accompanying proxy statement.

In connection with the Acquisition, on September 29, 2022, Solid entered into securities purchase agreements (the “Securities Purchase Agreement”) with several accredited investors pursuant to which Solid agreed to issue and sell to the investors in a private placement (the “Private Placement”) an aggregate of 10,638,290 shares of Solid’s common stock, at a price per share of $7.05. Solid expects to receive aggregate gross proceeds from the Private Placement of approximately $75.0 million, before deducting placement agent fees and estimated offering expenses payable by Solid. The Private Placement is expected to close as of immediately following the closing of the Acquisition, subject to the satisfaction of specified customary closing conditions, including approval from the stockholders of Solid, and contingent upon, among other things, the closing of the Acquisition. The Private Placement and the Securities Purchase Agreement are more fully described in the accompanying proxy statement.

At the Special Meeting, you will be asked to consider and vote upon the following proposals:

Please refer to the attached proxy statement for further information about the proposals. Solid is seeking approval to issue shares of Solid’s common stock in connection with the Acquisition equal to the Stock Consideration, as described above, and 10,638,290 shares of Solid’s common stock in the Private Placement. Because Solid is seeking your approval to issue its shares of common stock in the Acquisition and the Private Placement, the accompanying proxy statement includes certain material information regarding Solid, AavantiBio, the Acquisition, the Merger Agreement, the Private Placement and the Securities Purchase Agreement.

As described in the accompanying proxy statement, certain of Solid’s stockholders who in the aggregate owned approximately 29.8% of the shares of Solid’s common stock outstanding as of immediately prior to the date of the Merger Agreement are parties to support agreements, whereby such stockholders have agreed to vote their shares in favor of the Share Issuance Proposal, subject to the terms and conditions set forth therein.

Stockholders will not be able to attend the Special Meeting in person and will be able to attend the Special Meeting only via the webcast. Solid believes that hosting a “virtual meeting” will enable greater stockholder attendance and participation from any location around the world. Solid has designed the format of the Special Meeting to provide stockholders the same rights and opportunities to participate as they would at an in-person meeting.

Solid’s Board has fixed the close of business on    , 2022 as the record date for the purpose of determining the stockholders who are entitled to receive notice of, and to vote at, the Special Meeting. Only stockholders of record at the close of business on the record date are entitled to notice of, and to vote at, the Special Meeting and at any adjournment of that meeting. Stockholders of record at the close of business on the record date can attend the Special Meeting, including to vote their shares and ask questions, by accessing     shortly prior to the scheduled start of the meeting and entering the 16-digit control number included on your proxy card or voting instruction form.

The rules and procedures applicable to the Special Meeting, together with a list of stockholders of record for inspection for any legally valid purpose, will be available for the participating stockholders of record at    .

On or about    , 2022, Solid is mailing to our stockholders a paper copy of our proxy materials, including a proxy card. The proxy card contains instructions on how to cast your vote via the Internet or by telephone.

Your vote is very important. Whether or not you plan to attend the Special Meeting online, please vote your shares by proxy as promptly as possible to ensure your representation and the presence of a quorum at the Special Meeting. You may vote electronically at the meeting, by telephone, online, or by completing and returning the enclosed proxy card. Solid recommends you vote by proxy even if you plan to participate in the virtual meeting. You can always change your vote by voting electronically at the virtual meeting.

Solid is excited about the opportunities that the acquisition of AavantiBio and the Private Placement bring to its stockholders, and thanks you for your consideration and continued support.

This proxy statement and the accompanying proxy card or voting instruction card are available for viewing, printing and downloading at:      . These documents are also available to any stockholder who wishes to receive a paper copy free of charge by calling (617) 337-4680 or emailing investors@solidbio.com. This proxy statement is also available on the SEC’s website at http://www.sec.gov.

This proxy statement contains information about the Special Meeting of Stockholders (the “Special Meeting”) of Solid Biosciences Inc. (the “Company” or “Solid”) to be held on    ,    , 2022 at    a.m., Eastern Time.

Solid’s Board of Directors (the “Board of Directors” or the “Board”) has furnished this proxy statement and the enclosed proxy card in connection with the solicitation of proxies by Solid’s Board of Directors for the Special Meeting, and any adjournment or postponement of the Special Meeting.

This proxy statement, together with the enclosed form of proxy card, is first being mailed to Solid’s stockholders on or about     , 2022.

All properly submitted proxies will be voted in accordance with the instructions contained in those proxies. If no instructions are specified, the shares represented by the proxies will be voted in accordance with the recommendation of Solid’s Board with respect to each of the matters set forth in the proxy card.

This proxy statement and the accompanying proxy card or voting instruction card are available at:    .

In this proxy statement, the terms “we,” “us,” “our,” “the Company” or “Solid” refer to Solid Biosciences Inc. unless the context indicates otherwise. In this proxy statement, the term “AavantiBio,” refers to AavantiBio, Inc., unless the context indicates otherwise. The surviving corporation following the Acquisition (as defined below) is referred to herein as “the combined company” or “Post-Closing Solid.”

Unless the context indicates otherwise, all information in this proxy statement gives effect to a one-for-15 reverse stock split of our common stock that became effective on October 27, 2022. As a result of the reverse stock split, every 15 shares of our common stock issued and outstanding were converted into one share of our common stock. All share and per share amounts in this proxy statement have been retrospectively adjusted to give effect to the reverse stock split for all periods presented.

Solid has supplied all information contained in this proxy statement relating to Solid, and AavantiBio has supplied all information contained in this proxy statement relating to AavantiBio. Solid and AavantiBio have both contributed to the information related to the Acquisition contained in this proxy statement.

The following are some questions that you, as a holder of common stock of Solid, may have regarding the Special Meeting, the Acquisition, the Private Placement and the proposals and brief answers to such questions. Solid urges you to carefully read this entire proxy statement and the documents referred to in this proxy statement because the information in this section does not provide all the information that may be important to you as a stockholder of Solid with respect to the proposals.

The Special Meeting will be held on    , 2022 at    , Eastern Time. The Special Meeting will be held via the Internet at a webcast at     . As always, Solid encourages you to vote your shares prior to the Special Meeting regardless of whether you intend to attend virtually via the webcast.

On September 29, 2022, Solid entered into an Agreement and Plan of Merger with Greenland Merger Sub LLC, a Delaware limited liability company and wholly owned subsidiary of Solid (“Transitory Subsidiary”), AavantiBio, and, solely in his capacity as equityholder representative, Doug Swirsky (the “Merger Agreement”), a copy of which is attached as Annex A. The Merger Agreement, as it may be amended from time to time, contains the terms and conditions of the proposed acquisition by Solid of AavantiBio, a privately-held gene therapy company. The Merger Agreement provides for the acquisition of AavantiBio by Solid through the merger of Transitory Subsidiary into AavantiBio, with AavantiBio surviving as a wholly owned subsidiary of Solid (the “Acquisition”). Following the Acquisition, Solid will continue to operate under the name Solid Biosciences Inc. and Solid’s ticker symbol will continue to be “SLDB”.

The aggregate consideration payable to the former stockholders of AavantiBio by Solid in the Acquisition will be, subject to certain adjustments based on AavantiBio’s indebtedness as of the closing of the Acquisition, (i) $1,000 in cash and (ii) a number of shares of Solid’s common stock (rounded to the nearest whole share) equal to fifteen percent (15%) of outstanding shares of Solid’s common stock as of immediately following the closing of the Acquisition (and for the avoidance of doubt, before giving effect to the issuance of any securities pursuant to the Private Placement (as defined below)), calculated on a fully diluted basis using the treasury stock method (including, for clarity, calculated by disregarding any out-of-the-money outstanding stock options of Solid and treating any awards or grants that are subject to vesting at such time as being fully vested, settled and outstanding at such time to the extent such awards are not out-of-the-money). For for more information about the Acquisition, please see the sections titled “The Acquisition” beginning on page 91 of this proxy statement.

Solid believes that the acquisition of AavantiBio provides an opportunity to add to Solid’s existing pipeline, strengthen its leadership team and add substantial capital resources, including pursuant to the concurrent Private Placement, positioning it to become a genetic medicine company focused on both neuromuscular and cardiac rare diseases. Following the Acquisition, Post-Closing Solid will focus on advancing a portfolio of neuromuscular and cardiac programs, led by Solid’s SGT-003, a differentiated gene transfer candidate for the treatment of Duchenne muscular dystrophy. The pipeline of programs to be acquired from AavantiBio in the Acquisition include AVB-202, a gene transfer candidate for the treatment of Friedreich’s ataxia, AVB-401, a product candidate for the treatment of BAG3 mediated dilated cardiomyopathy, and additional early-stage assets for the treatment of undisclosed cardiac diseases. For a discussion of Solid’s reasons for the Acquisition, please see the section titled “The Acquisition—Solid’s Reasons for the Acquisition and the Private Placement” beginning on page 96 of this proxy statement.

On September 29, 2022, concurrently with the execution of the Merger Agreement, Solid entered into securities purchase agreements (the “Securities Purchase Agreement”) with several accredited investors, pursuant to which Solid agreed to issue and sell to such investors in a private placement an aggregate of 10,638,290 shares of Solid’s common stock, at a price of $7.05 per share (the “Private Placement”). Solid expects to receive aggregate gross proceeds from the Private Placement of approximately $75.0 million, before deducting placement agent fees and estimated offering expenses payable by Solid.

The Private Placement is expected to close as of immediately following the closing of the Acquisition, subject to the satisfaction of specified customary closing conditions, including approval from the stockholders of Solid of the Share Issuance Proposal (as defined below), and contingent upon, among other things, the closing of the Acquisition. For more detail on the Securities Purchase Agreement and the Private Placement, see the section titled “Agreements Related to the Acquisition and the Private Placement—Securities Purchase Agreement and Registration Rights Agreement—Securities Purchase Agreement” beginning on page 123 of this proxy statement.

On September 29, 2022, in connection with the entry into the Securities Purchase Agreement, Solid entered into a registration rights agreement (the “Registration Rights Agreement”) with the investors in the Private Placement, pursuant to which Solid agreed to register for resale the shares of common stock to be issued in the Private Placement. On or prior to the closing of the Acquisition, each AavantiBio stockholder entitled to receive shares of Solid’s common stock in the Acquisition may elect to become party to the Registration Rights Agreement, in which case Solid will also register for resale the shares of Solid’s common stock to be issued in the Acquisition. Under the Registration Rights Agreement, Solid has agreed to file a registration statement covering the resale of the shares of Solid’s common stock to be issued in the Private Placement and in the Acquisition within 60 days following the closing of the Private Placement. Post-Closing Solid has agreed to use commercially reasonable efforts to cause such registration statement to become effective as soon as practicable and to keep such registration statement effective until the date the shares of common stock covered by such registration statement have been sold or cease to be registrable securities under the Registration Rights Agreement. For more detail on the Registration Rights Agreement, see the section titled “Agreements Related to the Acquisition and the Private Placement—Securities Purchase Agreement and Registration Rights Agreement—Registration Rights Agreement” beginning on page 124 of this proxy statement.

If, for any reason, the Acquisition is not consummated, Solid will not complete the share issuance pursuant to the Merger Agreement, and as a result the Private Placement, which is conditioned on the closing of the Acquisition, will also not be consummated. Under certain specified circumstances, Solid may be obligated to pay AavantiBio a termination fee of $310,000 and reimburse certain expenses of AavantiBio up to $750,000, as more fully described in the section titled “The Merger Agreement—Termination and Termination Fees.”

You are receiving this proxy statement because you have been identified as a holder of Solid’s common stock as of the close of business on     , 2022 (the “Record Date”) and you are entitled to notice of, and to vote at, the Special Meeting. This proxy statement contains important information about the Special Meeting, the Acquisition, the Merger Agreement, the Private Placement, the Securities Purchase Agreement and the other business to be considered by Solid’s stockholders at the Special Meeting and you should read it carefully and in its entirety.

At the Special Meeting, you will be asked to vote upon:

The Board of Solid unanimously recommends that the stockholders vote “FOR” the Share Issuance Proposal and “FOR” the Plan Proposal.

As a condition to the closing of the Acquisition and the Private Placement, Proposal No. 1, which is the Share Issuance Proposal, must be approved by the requisite stockholder vote at the Special Meeting. Approval of Proposal No. 2, which is the Plan Proposal, is not a condition for the closing of the Acquisition or the Private Placement.

Concurrently with the execution of the Merger Agreement, certain stockholders of Solid holding approximately 29.8% of the outstanding shares of Solid’s common stock entered into support agreements with Solid to vote all of their shares of Solid’s common stock (a) in favor of the Share Issuance Proposal and (b) against any alternative acquisition proposals.

In addition to the requirement of obtaining Solid’s stockholder approval of the Share Issuance Proposal at the Special Meeting, the closing of the Acquisition is subject to the satisfaction or waiver of each of the other closing conditions set forth in the Merger Agreement and the closing of the Private Placement is subject to the closing of the Acquisition and the satisfaction or waiver of each of the other closing conditions set forth in the Securities Purchase Agreement. For a complete description of the closing conditions under the Merger Agreement, we urge you to read the section titled “The Merger Agreement—Conditions to the Completion of the Acquisition” beginning on page 117 of this proxy statement. For a complete description of the closing conditions under the Securities Purchase Agreement, we urge you to read the section titled “Agreements Related to the Acquisition and the Private Placement—Securities Purchase Agreement and Registration Rights Agreement—Securities Purchase Agreement” beginning on page 123 of this proxy statement.

You should carefully review the section titled “Risk Factors” beginning on page 10 of this proxy statement, which set forth certain risks and uncertainties related to the Acquisition and the Private Placement, risks and uncertainties to which Post-Closing Solid’s business will be subject, and risks and uncertainties to which each of Solid and AavantiBio, as independent companies, are subject.

Following the consummation of the Acquisition, Alexander (Bo) Cumbo (AavantiBio’s President and Chief Executive Officer who will serve as President and Chief Executive Officer of Solid following the Acquisition) and Adam Koppel (Managing Director of Bain Capital Life Sciences) will each join the board of directors of Post-Closing Solid. All of the current members of Solid’s board will remain on the board of directors of Post-Closing Solid. The staggered structure of Solid’s board of directors will remain in place for the combined company following the completion of the Acquisition.

Immediately following the closing of the Acquisition, the executive management team of Post-Closing Solid is expected to be composed of the following:

Solid currently anticipates that the Acquisition will be consummated during the fourth quarter of 2022, soon after the Special Meeting to be held on    , 2022, but Solid cannot predict the exact timing. For more information about the conditions to the consummation of the Acquisition, please see the section titled “The Merger Agreement—Conditions to the Completion of the Acquisition” beginning on page 117 of this proxy statement.

Solid will not recognize any gain or loss for U.S. federal income tax purposes upon consummation of the Acquisition. In addition, because the stockholders of Solid immediately prior to the consummation of the Acquisition will not sell, exchange or dispose of any shares of Solid common stock in the Acquisition, such stockholders will not recognize any gain or loss upon consummation of the Acquisition.

No, Solid’s stockholders are not entitled to dissenters’ rights in connection with the Acquisition. AavantiBio’s stockholders are entitled to dissenters’ rights in connection with the Acquisition. For more information about dissenters’ rights, please see the section titled “The Acquisition—Appraisal Rights and Dissenters’ Rights” beginning on page 108 of this proxy statement.

Yes, AavantiBio’s stockholders have adopted the Merger Agreement and approved the Acquisition via a written consent of the stockholders of AavantiBio. For more information on the matters approved by the stockholders of AavantiBio please see the sections titled “The Merger Agreement—Conditions to the Completion of the Acquisition” beginning on page 117 of this proxy statement and “The Merger Agreement—Meeting of Solid’s Stockholders and Written Consent of AavantiBio’s Stockholders” beginning on page 115 of this proxy statement.

Stockholders who owned shares of Solid’s common stock on the Record Date may attend and vote at the Special Meeting. There were    shares of Solid’s common stock outstanding on the Record Date. All shares of common stock have one vote per share and vote together as a single class.

The proxy card enables you to appoint Ilan Ganot and Erin Powers Brennan as your proxies at the Special Meeting. By completing and returning or submitting the proxy card as described herein or therein, you are authorizing these individuals to vote your shares at the Special Meeting in accordance with your instructions on the proxy card. This way, your shares will be voted whether or not you attend the Special Meeting. Even if you plan to attend the Special Meeting online, Solid recommends completing and returning or submitting your proxy card before the Special Meeting date in the event your plans change. If a proposal comes up for vote at the Special Meeting that is not on the proxy card, the proxies will vote your shares, under your proxy, according to their best judgment.

Most of Solid’s stockholders hold their shares through a bank, broker or other nominee, rather than holding share certificates in their own name. As summarized below, there are some distinctions between shares held of record and those owned beneficially.

Solid will host the Special Meeting live online via webcast. You may attend the Special Meeting live online by visiting    . The live audio webcast will start at    Eastern time on   ,     , 2022. Online access to the audio webcast will open 10 minutes prior to the start of the Special Meeting to allow time for you to log-in and test your device’s audio system. To be admitted to the virtual Special Meeting, you will need to

log-in at     using the 16-digit control number included on your proxy card or voting instruction form. You are entitled to participate in the Special Meeting only if you were a stockholder as of the close of business on the Record Date, or if you hold a valid proxy for the Special Meeting.

Beginning 10 minutes prior to, and during, the Special Meeting, Solid will have support available to assist stockholders with any technical difficulties they may have accessing or hearing the virtual meeting. If you encounter any difficulty accessing, or during, the virtual meeting, please call the support team at the numbers listed on the web portal at the time of the meeting.

You will be able to submit your questions prior to and during the Special Meeting by visiting    .

The representation online or by proxy of holders of at least a majority of the issued and outstanding shares of Solid’s common stock entitled to vote at the Special Meeting is necessary to constitute a quorum for the transaction of business at the Special Meeting. For purposes of determining the presence of a quorum, abstentions will be counted as present at the Special Meeting. Shares present virtually during the Special Meeting will be considered shares of common stock represented online at the meeting.

A complete list of registered stockholders will be available to stockholders of record during the Special Meeting for examination at    .

Stockholders have four voting options. You may vote using one of the following methods:

Telephone and Internet voting for stockholders of record will be available up until 11:59 p.m., Eastern Time, on    , 2022, and mailed proxy cards must be received by     , 2022 in order to be counted at the Special Meeting. If the Special Meeting is adjourned or postponed, these deadlines may be extended.

If you do not vote by virtue of not being present virtually or by proxy at the Special Meeting, your shares will not be counted for purposes of determining the existence of a quorum.

Abstentions will be counted for the purpose of determining the existence of a quorum.

In tabulating the voting result for the Share Issuance Proposal and the Plan Proposal, abstentions will have the effect of a vote “AGAINST” the Share Issuance Proposal and the Plan Proposal.

Broker non-votes occur on a matter when a bank, broker or other nominee is not permitted to vote on that matter without instructions from the beneficial owner and instructions are not given. These matters are referred to as “non-routine” matters. Broker non-votes will not be counted for the purpose of determining the existence of a quorum. The Share Issuance Proposal and the Plan Proposal are “non-routine” matters. If you do not instruct your bank, broker or other nominee how to vote with respect to the Share Issuance Proposal or the Plan Proposal, your bank, broker or other nominee may not vote with respect to such proposal and those votes will be counted as broker non-votes. In tabulating the voting result for the Share Issuance Proposal and the Plan Proposal, shares that constitute broker non-votes will have no effect on the Share Issuance Proposal or the Plan Proposal.

If your shares are registered differently or in more than one account, you will receive more than one proxy card. To make certain all of your shares are voted, please follow the instructions included in the Notice of Special Meeting of Stockholders on how to access each proxy card and vote each proxy card by telephone or through the Internet. If you requested or received paper proxy materials by mail, please complete, sign and return each proxy card to ensure that all of your shares are voted.

If you just sign or submit your proxy card without providing further instructions, your shares will be counted as a vote “FOR” the Share Issuance Proposal and “FOR” the Plan Proposal.

You may revoke your proxy and change your vote at any time before the polls close at the Special Meeting. You may do this by:

Please note, however, that if your shares are held of record by a bank, broker or other nominee, you must instruct your bank, broker or other nominee that you wish to change your vote by following the procedures on the voting form provided to you by the bank, broker or other nominee. If your shares are held in street name, and you wish      to attend and vote at the Special Meeting, you will need your 16-digit control number included on your proxy card or voting instruction form in order to demonstrate proof of beneficial ownership and to be able to vote during the Special Meeting. Instructions on how to attend and participate online, including how to demonstrate proof of stock ownership, are posted at     . Simply attending the Special Meeting will not constitute a revocation of your proxy.

Solid will bear the costs of soliciting proxies. In addition to solicitations by mail, Solid’s directors, officers and regular employees, without additional remuneration, may solicit proxies by telephone, facsimile, email, personal interviews and other means.

A representative of PricewaterhouseCoopers LLP, Solid’s independent registered public accounting firm, is expected to be present at the Special Meeting and will have an opportunity to make a statement if he or she desires to do so and to respond to appropriate questions from Solid’s stockholders.

If you are a holder of Solid’s common stock as of the Record Date and would like additional copies, without charge, of this proxy statement or if you have questions about the proposals, the Acquisition or the Private Placement, including the procedures for voting your shares, you should contact:

Solid plans to announce preliminary voting results at the Special Meeting and will publish final results in a Current Report on Form 8-K to be filed with the Securities and Exchange Commission within four business days following the Special Meeting.

Solid’s common stock is currently listed on The Nasdaq Global Select Market under the symbol “SLDB.” AavantiBio is a private company and the shares of AavantiBio are not publicly traded. Upon the closing of the Acquisition, Solid’s common stock will continue to be listed under the symbol “SLDB.”

The closing price of Solid’s common stock on September 29, 2022, the trading day immediately prior to the public announcement of the Acquisition on September 30, 2022, as reported on The Nasdaq Global Select Market, was $7.02 per share. The closing price of Solid’s common stock on October 26, 2022, as reported on The Nasdaq Global Select Market, was $6.90 per share.

Because the market price of Solid’s common stock is subject to fluctuation, the market value of the shares of Solid’s common stock that AavantiBio stockholders will be entitled to receive in the Acquisition and that the investors will be entitled to receive in the Private Placement may increase or decrease.

As of    , 2022, the Record Date for the Special Meeting, Solid had approximately   holders of record of Solid’s common stock. This number does not include beneficial owners whose shares were held in street name. The actual number of holders of Solid’s common stock is greater than this number of record holders and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers or held by other nominees. This number of holders of record also does not include stockholders whose shares may be held in trust by other entities.

As of     , 2022, the Record Date for the Special Meeting, AavantiBio had approximately   holders of record of AavantiBio’s common stock and    holders of record of AavantiBio’s preferred stock.

Solid has never declared or paid any cash dividends on Solid’s capital stock and does not anticipate paying cash dividends on Solid’s capital stock for the foreseeable future. Solid currently intends to retain all of its future earnings, if any, to finance the growth and development of the business. In addition, the terms of any future debt agreements may preclude Solid from paying dividends, and pursuant to the Merger Agreement, Solid cannot, without the written consent of AavantiBio, declare or pay dividends on Solid’s capital stock during the period prior to the closing of the Acquisition. Notwithstanding the foregoing, any determination to pay cash dividends subsequent to the Acquisition (in which AavantiBio will become a wholly owned subsidiary of Solid) will be at the discretion of Post-Closing Solid’s board of directors and will depend upon a number of factors, including Post-Closing Solid’s results of operations, financial condition, future prospects, contractual restrictions, restrictions imposed by applicable law and other factors the then-current board of directors deems relevant.

AavantiBio has never declared or paid any cash dividends on shares of AavantiBio’s capital stock. Pursuant to the Merger Agreement, AavantiBio cannot, without the written consent of Solid, declare or pay dividends on AavantiBio’s capital stock during the period prior to the closing of the Acquisition. If the Acquisition is not consummated, AavantiBio does not anticipate paying cash dividends on the AavantiBio’s capital stock for the foreseeable future, and any future determination to pay cash dividends will be at the discretion of AavantiBio’s then-current board of directors and will depend upon a number of factors, including AavantiBio’s results of operations, financial condition, future prospects, contractual restrictions, restrictions imposed by applicable law and other factors the then-current board of directors deems relevant.

The combined company will be faced with a market environment that cannot be predicted and that involves significant risks, many of which will be beyond its control. In addition to the other information contained in this proxy statement, you should carefully consider the material risks described below before deciding how to vote your shares of Solid’s common stock. You should also read and consider the other information in this proxy statement. Please see the section titled “Where You Can Find More Information.”

If the Acquisition is not completed, Solid is subject to the following risks, among others:

If the Merger Agreement is terminated and the Board of Solid determines to seek another strategic or financial transaction, there can be no assurance that Solid will be able to identify and/or consummate such a transaction that would yield greater benefits than the benefits to be provided under the Merger Agreement.

The closing of the Acquisition is subject to a number of conditions as set forth in the Merger Agreement that must be satisfied or waived, including, among others, the approval of the Share Issuance Proposal by Solid’s stockholders at the Special Meeting and the other conditions described in the section titled “The Merger Agreement—Conditions to the Completion of the Acquisition” beginning on page 117 of this proxy statement.

There can be no assurance as to whether or when the conditions to the closing of the Acquisition will be satisfied or waived or as to whether or when the Acquisition will be consummated. If the conditions are not satisfied or waived, the Acquisition may not be consummated or the closing may be delayed, and Solid and AavantiBio each may lose some or all of the intended benefits of the Acquisition.

In connection with the Acquisition, on September 29, 2022, Solid entered into the Securities Purchase Agreement with certain investors, pursuant to which the investors agreed to purchase 10,638,290 shares of Solid’s common stock upon the closing of the Private Placement, which is expected to occur as of immediately following the closing of the Acquisition. The expected gross proceeds from the Private Placement are approximately $75 million, before deducting placement agent fees and estimated offering expenses. The closing of the Private Placement is subject to a number of conditions as set forth in the Securities Purchase Agreement that must be satisfied or waived, including, among others, the approval of the Share Issuance Proposal at the Special Meeting by Solid’s stockholders, the closing of the Acquisition and the other conditions described in the section titled “The Merger Agreement—Securities Purchase Agreement and Registration Rights Agreement” beginning on page 123 of this proxy statement. In the event of any such failure to meet the conditions precedent, if the investors in the Private Placement do not waive Solid’s requirement to satisfy such conditions (to the extent applicable), then the Private Placement will not close.

In general, neither Solid nor AavantiBio is obligated to complete the Acquisition if there is a “material adverse effect” affecting the other party between September 29, 2022, the date of the Merger Agreement, and the closing of the Acquisition. However, certain types of changes are excluded from the concept of a “material adverse effect.” Such exclusions include, but are not limited to, changes in general business or economic conditions affecting the industry in which Solid and/or AavantiBio, as applicable, operates, changes in the generally accepted accounting principles in the United States, or GAAP, changes in laws, rules or regulations of general applicability or interpretations thereof, natural disasters, pandemics (including the COVID-19 pandemic), acts of war, outbreak or escalation of hostilities or acts of terrorism, changes in financial, banking, securities markets, or general economic, regulatory, legislative or political conditions (including changes in interest or exchange rates), changes resulting from the announcement or pendency of the Acquisition, and failures to meet internal expectations or projections of results of operations. Therefore, if any of these events were to occur

impacting Solid or AavantiBio, the other party would still be obliged to consummate the closing of the Acquisition. If any such adverse changes occur and Solid and AavantiBio consummate the closing of the Acquisition, the stock price of Solid following the closing may suffer. This in turn may reduce the value of the Acquisition to the stockholders of Solid, AavantiBio or both. For a more complete discussion of what constitutes a “material adverse effect” on Solid or AavantiBio, see the section titled “The Merger Agreement—Representations and Warranties” beginning on page 110 of this proxy statement.

Directors and executive officers of Solid and AavantiBio have interests in the Acquisition that are different from, or in addition to, the interests of Solid’s stockholders generally. These interests with respect to Solid’s directors and executive officers may include, among others, that Solid’s directors and certain of Solid’s executive officers are expected to continue to serve as directors and executive officers, respectively, of the combined company after the closing of the Acquisition; that certain of Solid’s and AavantiBio’s current executive officers have entered into executive transition and separation agreements providing for certain termination benefits effective upon the closing of the Acquisition; that certain of Solid's and AavantiBio's current executive officers have agreed to enter into consulting arrangements with Solid for a period of time following the closing of the Acquisition; and that Solid’s directors and executive officers are entitled to certain indemnification and liability insurance coverage pursuant to the terms of the Merger Agreement. These interests with respect to AavantiBio’s directors and executive officers may include, among others, retention bonus payments; severance payments if employment is terminated in a qualifying termination in connection with the Acquisition and rights to continued indemnification; expense advancement and insurance coverage. Certain of AavantiBio’s directors have also dedicated substantial time to the inventions underlying AavantiBio’s product candidates, have a personal interest in seeing those product candidates advanced and may receive additional future payments outside of their relationship with AavantiBio based on certain milestones in the advancement of AavantiBio's product candidates. Additionally, certain directors of Solid and AavantiBio and/or their respective affiliated funds will receive additional shares of Solid common stock in the Acquisition and certain funds affiliated with directors of Solid have agreed to participate in the Private Placement, including certain funds affiliated with RA Capital, Perceptive and Bain. Certain of AavantiBio’s executive officers are expected to continue as executive officers of the combined company after the effective time of the Acquisition, including that Alexander (Bo) Cumbo, President and Chief Executive Officer of AavantiBio, is expected to serve as President and Chief Executive Officer of the combined company and on the board of directors of the combined company as of, and contingent upon, the effective time of the Acquisition.

The Solid and AavantiBio boards of directors were aware of and considered those interests, among other matters, in reaching their decisions to approve and adopt the Merger Agreement, approve the Acquisition, and recommend the approval of the Merger Agreement and related matters to Solid and AavantiBio stockholders. These interests, among other factors, may have influenced the directors and executive officers of Solid and AavantiBio to support or approve the Acquisition.

For more information regarding the interests of Solid’s and AavantiBio’s directors and executive officers in the Acquisition, please see the sections titled “The Acquisition—Interests of Solid’s Directors and Executive Officers in the Acquisition” beginning on page 98 and “The Acquisition—Interests of AavantiBio’s Directors, Executive Officers and Certain Other Persons in the Acquisition” beginning on page 102 of this proxy statement.

Pursuant to the Merger Agreement, the aggregate consideration payable to former stockholders of AavantiBio shall be (i) $1,000 of cash plus (ii) a number of shares of Solid’s common stock equal to (a) fifteen percent (15%) of outstanding shares of Solid’s common stock as of immediately following the closing of the Acquisition, less (b) a number of shares of Solid’s common stock equal to (i) the amount by which the aggregate amount of closing indebtedness exceeds $3,000,000, divided by (ii) the VWAP of Solid’s common stock over the five (5) consecutive trading day period ending two (2) full trading days prior to the closing date of the Acquisition.

Because the final exchange ratio depends on a formula determined at the closing of the Acquisition, including based on the number of shares of Solid’s common stock then outstanding, the amount of closing

indebtedness of AavantiBio and Solid’s trading price determined as described above, Solid stockholders will not know or be able to determine at the time of the Special Meeting the exact number of shares of Solid’s common stock that AavantiBio stockholders will receive as aggregate consideration or the market value of such shares.

The market price of Solid’s common stock has fluctuated prior to and after the date of the announcement of the Merger Agreement and will continue to fluctuate from the date of this proxy statement to the date of the Special Meeting, and through the date the Acquisition is completed. It is impossible to accurately predict the market price of Solid’s common stock and, therefore, impossible to accurately predict the value of the shares of Solid’s common stock that Solid will issue to former AavantiBio stockholders in the Acquisition. Stock price changes may result from a variety of factors, including, among others, general market and economic conditions, changes in Solid’s business results of operations, financial condition and prospects, the effect of uncertainties related to the COVID-19 pandemic on U.S. and global markets, market assessments of the likelihood that the Acquisition will be completed, interest rates and other factors generally affecting the price of Solid’s common stock, and the timing of the Acquisition. Many of these factors are beyond the control of Solid.

If the combined company is unable to realize the full strategic and financial benefits currently anticipated from the Acquisition, Solid’s stockholders will have experienced substantial dilution of their ownership interests without receiving any commensurate benefit, or only receiving part of the commensurate benefit to the extent the combined company is able to realize only part of the benefits currently anticipated from the Acquisition and the Private Placement.

AavantiBio’s obligations and liabilities, some of which may not have been disclosed to Solid or may not be reflected or reserved for in AavantiBio’s historical financial statements, may be greater than Solid has anticipated. The obligations and liabilities of AavantiBio could have a material adverse effect on AavantiBio’s business or AavantiBio’s value to Solid or on Solid’s business, financial condition, or results of operations. Solid has only limited indemnification from AavantiBio under the Merger Agreement with respect to obligations or liabilities of AavantiBio, whether known or unknown. In addition, even in cases where Solid is able to obtain indemnification, Solid may discover liabilities greater than the contractual limits or the financial resources of the indemnifying party. In the event that Solid is responsible for liabilities substantially in excess of any amounts recovered through rights to indemnification or alternative remedies that might be available to Solid, or any applicable insurance, Solid could suffer severe consequences that would substantially reduce our earnings and cash flows or otherwise materially and adversely affect Solid’s business, financial condition, or results of operations.

The market price of Solid’s common stock is subject to significant fluctuations. During the 12-month period ended October 26, 2022, the closing sales price of Solid’s common stock on The Nasdaq Global Select Market ranged from a high of $36.90 on November 4, 2021 to a low of $6.42 on May 11, 2022. Market prices for securities of pharmaceutical, biotechnology and other life science companies have historically been particularly volatile. The market price of Solid’s common stock will likely be volatile based on whether stockholders and other investors believe that Solid can complete the Acquisition and the Private Placement or otherwise raise additional capital to support Solid’s operations if the Acquisition is not consummated and another strategic or financial transaction cannot be identified, negotiated and consummated in a timely manner, if at all. In addition, Solid’s common stock will remain subject to such significant fluctuations even if the Acquisition and the Private Placement are completed.

The volatility of the market price of Solid’s common stock may be exacerbated by low trading volume or other factors. Moreover, the stock markets in general have experienced substantial volatility that has often been unrelated to the operating performance of individual companies. These broad market fluctuations may also adversely affect the trading price of Solid’s common stock. In the past, following periods of volatility in the market price of a company’s securities, stockholders have often instituted class action securities litigation against such companies.

The market price of Solid’s common stock may decline as a result of the Acquisition for a number of reasons, including if:

Covenants in the Merger Agreement impede the ability of Solid and AavantiBio to make acquisitions during the pendency of the Acquisition, subject to specified exceptions. As a result, if the Acquisition is not completed, the parties may be at a disadvantage to their competitors during that period. In addition, while the Merger Agreement is in effect, each party is generally prohibited from soliciting, initiating or knowingly encouraging, inducing or facilitating the communication, making, submitting or announcing any acquisition proposal or acquisition inquiry or taking any action that could reasonably be expected to lead to an acquisition proposal or acquisition inquiry, subject to specified exceptions. Any such transactions could be favorable to such party’s stockholders, but the parties may be unable to pursue them. For more information, see the section titled “The Merger Agreement—Non-Solicitation” beginning on page 114 of this proxy statement.

The terms of the Merger Agreement prohibit each of Solid and AavantiBio from soliciting competing proposals or cooperating with persons making unsolicited takeover proposals, except, in the case of Solid, in limited circumstances as described in further detail in the section titled “The Merger Agreement—Non-Solicitation” beginning on page 114 of this proxy statement. In addition, if the Merger Agreement is terminated under specified circumstances, Solid would be required to pay AavantiBio a termination fee of $310,000 and reimburse AavantiBio’s expenses up to a maximum of $750,000. These payments may discourage third parties from submitting competing proposals to Solid or its stockholders, and may cause the Solid Board to be less inclined to recommend a competing proposal.

The outstanding capital stock of AavantiBio is privately held and is not traded in any public market. The lack of a public market makes it difficult to determine the fair market value of AavantiBio’s capital stock. Because the percentage of Solid’s equity to be issued to AavantiBio’s stockholders in the Acquisition was determined based on negotiations between the parties, it is possible that the value of Solid’s common stock to be issued to AavantiBio’s stockholders in connection with the Acquisition will be more or less than the fair market value of AavantiBio’s capital stock.

Securities litigation or stockholder derivative litigation frequently follows the announcement of certain significant business transactions, such as the sale of a business division or announcement of an acquisition or a business combination transaction. Solid and AavantiBio may become involved in this type of litigation in

connection with the Acquisition, the Private Placement and the other transactions contemplated by the Merger Agreement and the combined company may become involved in this type of litigation in the future. Litigation often is expensive and diverts management’s attention and resources, which could adversely affect the business of Solid, AavantiBio and the combined company.

Since inception, we have incurred significant net losses. Our net loss was $50.4 million for the six months ended June 30, 2022. Our net losses were $72.2 million and $88.3 million for the years ended December 31, 2021 and 2020, respectively. As of June 30, 2022, we had an accumulated deficit of $527.2 million. To date, we have devoted substantially all of our efforts to research and development, including clinical development of our gene transfer product candidate, SGT-001, and preclinical development of our gene transfer product candidate, SGT-003, as well as to building out our management team and infrastructure. We expect that it could be several years, if ever, before we have a commercialized product. We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future. We anticipate that our expenses will increase substantially if, and as, we:

To become and remain profitable, we must develop and eventually commercialize one or more product candidates with significant market potential. This will require us to be successful in a range of challenging activities, and our expenses will increase substantially as we continue to monitor patients dosed in IGNITE DMD and complete future clinical trials of SGT-003 and other future product candidates, obtain marketing approval for SGT-003 or other future product candidates, develop and validate commercial-scale manufacturing processes, manufacture, market and sell any future product candidates for which we may obtain marketing approval and satisfy any post-marketing requirements. We may never succeed in any or all of these activities and, even if we do, we may never generate revenue that is significant or large enough to achieve profitability. If we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our failure to become and remain profitable would decrease the value of our company and could impair our ability to raise capital, maintain our research and development efforts, expand our business or continue our operations. A decline in the value of our company also could cause stockholders to lose all or part of their investment.

We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the research and development of, conduct clinical trials of, and seek marketing approval for, SGT-003 and other future product candidates. In addition, if we obtain marketing approval for SGT-003 or other future product candidates, we expect to incur significant expenses related to product sales, marketing, manufacturing and distribution. We also expect to continue to incur additional costs associated with operating as a public company. While we believe that our cash, cash equivalents and available-for-sale securities as of June 30, 2022 (and without giving effect to the Acquisition or Private Placement, the completion of which cannot be assured) will be sufficient to fund our operating expenses and capital requirements into the second quarter of 2024, we have based this estimate on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently anticipate. In order to continue to operate our business beyond that time, we will need to raise additional funds. However, there can be no assurance that we will be able to generate funds on terms acceptable to us, on a timely basis, or at all. In addition, we anticipate that we will need additional funding to complete the development of SGT-003 and other future product candidates.

If we are able to complete the Acquisition and Private Placement, we would expect to have approximately $215.0 million of cash, cash equivalents, and available-for-sale securities at closing, which we believe will be sufficient to fund our operating expenses and capital expenditure requirements into 2025. There is no guarantee that these transactions will close as planned, or at all.

Our future capital requirements will depend on many factors, including:

Identifying potential product candidates and conducting preclinical testing and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product sales. In addition, our product candidates, if approved, may not achieve commercial success. Our product revenue, if any, will be

derived from or based on sales of product candidates that may not be commercially available for many years, if at all. Accordingly, we will need to continue to rely on additional financing to achieve our business objectives. Adequate additional financing may not be available to us on acceptable terms, or at all.

We may seek additional capital through a combination of public and private equity offerings, debt financings, strategic partnerships and alliances and licensing arrangements. To the extent that we raise additional capital through the sale of equity or convertible debt securities, ownership of our common stock will be diluted and the terms may include liquidation or other preferences that adversely affect the rights of our current stockholders. The incurrence of indebtedness would result in increased fixed payment obligations and could involve restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business. If we raise additional funds through strategic partnerships and alliances and licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, SGT-001, SGT-003 or other future product candidates, or grant licenses on terms unfavorable to us.

Our ability to generate revenue from product sales and achieve profitability depends on our ability, alone or with collaborative partners, to successfully complete the development of, and obtain the regulatory approvals necessary to commercialize, SGT-003 and other future product candidates that we may pursue in the future. We do not anticipate generating revenue from product sales for the next several years, if ever. Our ability to generate future revenue from product sales depends heavily on our success in:

We are a development-stage company founded in 2013. Our operations to date, with respect to the development of SGT-001, SGT-003 and other potential product candidates, have been limited to organizing and staffing our company, business planning, raising capital, acquiring rights to our technology, identifying SGT-001 and SGT-003 as potential gene transfer product candidates and undertaking preclinical studies of SGT-001 and SGT-003 and a clinical trial of SGT-001 and establishing research and development and manufacturing collaborations. We have not yet demonstrated the ability to complete clinical trials of SGT-001 or any other product candidate, obtain marketing approvals, manufacture a commercial-scale product or conduct sales and marketing activities necessary for successful commercialization. Consequently, any predictions our stockholders make about our prospects may not be as accurate as they could be if we had a longer operating history.

The ongoing COVID-19 pandemic has caused many governments to implement measures to slow the spread of the outbreak through quarantines, travel restrictions, heightened border scrutiny, and other measures. The outbreak and government measures taken in response have also 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. The future progression of the outbreak and its effects on our business and operations are uncertain.

We and our third-party manufacturers for our SGT-003 supply, and prospective contract research organizations, or CROs, may face disruptions that may affect our ability to initiate and complete preclinical studies or clinical trials, including disruptions in procuring items that are essential for our research and development activities, including, for example, raw materials used in the manufacturing of our product candidates, and laboratory supplies for our current and future preclinical studies and clinical trials, in each case, for which there may be shortages because of ongoing efforts to address the outbreak. We and our third-party manufacturers, and prospective CROs, may face disruptions related to future clinical trials arising from delays in IND-enabling studies, manufacturing disruptions, and the ability to obtain necessary institutional review board or other necessary site approvals, as well as other delays at clinical trial sites.

We may also face difficulties recruiting or enrolling patients for our clinical trials if patients are affected by the COVID-19 virus or are fearful of visiting or traveling to, or unable to travel to, clinical trial sites because of the outbreak. For example, we experienced a few missed or postponed patient visits in our IGNITE DMD trial due to site closures early in the COVID-19 pandemic.

The response to the COVID-19 pandemic may redirect resources with respect to regulatory and intellectual property matters in a way that would adversely impact our ability to progress regulatory approvals and protect our intellectual property. For example, the FDA has announced that in order to bring new therapies to patients sick with COVID-19 as quickly as possible, it has redeployed medical and regulatory staff from other areas to work on COVID-19 therapies. In addition, we may face impediments to regulatory meetings and approvals due to measures intended to limit in-person interactions.

We expect to continue to take actions as may be required or recommended by government authorities or as we determine are in the best interests of our employees, and other business partners in light of COVID-19. In the event of a continuation of shelter-in-place orders and/or other mandated local travel restrictions, our employees conducting research and development activities may not be able to access our research space, and our core activities may be significant limited or curtailed, possibly for an extended period of time.

The pandemic has caused significant disruptions in the financial markets, and may continue to cause such disruptions, which could impact our ability to raise additional funds through public offerings and may also impact the volatility of our stock price and trading in our stock. Moreover, it is possible the pandemic will

significantly impact economies worldwide, which could result in adverse effects on our business and operations. We cannot be certain what the overall impact of the COVID-19 pandemic, including any variant strains of the COVID-19 virus, will be on our business and it has the potential to adversely affect our business, financial condition, results of operations and prospects.

Finally, in response to the COVID-19 pandemic, the FDA issued guidance on March 18, 2020, and updated it on July 2, 2020, January 27, 2021, and August 30, 2021, to address the conduct of clinical trials during the pandemic. The guidance sets out a number of considerations for sponsors of clinical trials impacted by the pandemic, including the requirement to include in the clinical study report (or as a separate document) contingency measures implemented to manage the study, and any disruption of the study as a result of COVID-19; a list of all study participants affected by COVID-19-related study disruptions by a unique subject identifier and by investigational site, and a description of how the individual’s participation was altered; and analyses and corresponding discussions that address the impact of implemented contingency measures (e.g., participant discontinuation from investigational product and/or study, alternative procedures used to collect critical safety and/or efficacy data) on the safety and efficacy results reported for the study. In its most recent update to this guidance, the FDA addresses questions received during the past year from clinical practitioners who are adapting their operations in a pandemic environment. These questions focused on, among other things, when to suspend, continue or initiate a trial and how to submit changes to protocols for INDs and handle remote site monitoring visits. There is no assurance that this guidance governing clinical studies during the pandemic will remain in effect or, even if it does, that it will help address the risks and challenges enumerated above.

We have historically concentrated our research and development efforts on SGT-001 for the treatment of Duchenne. We plan to prioritize SGT-003 for the treatment of Duchenne and our future success depends on our successful development of SGT-003 and other future product candidates. Our risk of failure is high. We have experienced with SGT-001, and may in the future experience with SGT-003, problems or delays in developing these and other future product candidates. Any such problems or delays would cause unanticipated costs, and any development problems may not be solved. For example, we or another party may uncover a previously unknown risk associated with SGT-003, the adeno-associated virus, or AAV, vector, toxicity or other issues that may be more problematic than we currently believe and this may prolong the period of observation required for obtaining, or result in the failure to obtain, regulatory approval or may necessitate additional clinical testing.

In addition, the product specifications and the clinical trial requirements of the FDA, the European Commission, the European Medicines Agency, or the EMA, and other regulatory authorities and the criteria these regulators use to determine the safety and efficacy of a product candidate vary substantially according to the type, complexity, novelty and intended use and market of such product candidate. The regulatory approval process for novel product candidates such as ours is unclear and can be more expensive and take longer than for other, better known or more extensively studied product candidates. To our knowledge, only a limited number of gene transfer products have been approved for commercialization in the United States and the European Union. As a result, it is difficult to determine how long it will take or how much it will cost to obtain regulatory approvals for SGT-003 in either the United States or the European Union. Approvals by the European Commission may not be indicative of what the FDA may require for approval and vice versa.

During the conduct of clinical trials, patients may experience changes in their health, including illnesses, injuries, discomforts or a fatal outcome. Often, it is not possible to determine whether the product candidate being studied caused these conditions. For instance, we reported a serious adverse event in IGNITE DMD, which resulted in a clinical hold in November 2019, which has since been resolved, and previously the FDA had placed IGNITE DMD on clinical hold after we reported another serious adverse event. In April 2021, the eighth patient treated with SGT-001 in IGNITE DMD experienced a systemic inflammatory response which has since fully resolved. The event was classified as a serious adverse event and considered by the investigator to be drug related.

In addition, it is possible that as we test SGT-003 or other future product candidates in larger, longer and more extensive clinical programs, or as use of these product candidates becomes more widespread if they receive regulatory approval, illnesses, injuries, discomforts and other adverse events that were observed in earlier clinical trials, as well as conditions that did not occur or went undetected in previous clinical trials, will be reported by subjects. Many times, side effects are only detectable after investigational products are tested in large-scale, Phase III clinical trials or, in some cases, after they are made available to patients on a commercial scale after approval. If additional clinical experience indicates that SGT-003 or any other future product candidate has side effects or causes serious or life-threatening side effects, the development of the product candidate may fail or be delayed, or, if the product candidate has received regulatory approval, such approval may be revoked.

There have been several significant adverse side effects in gene therapy treatments in the past, including reported cases of leukemia and death seen in other clinical trials using other vectors. While new recombinant vectors have been developed with the intent to reduce these side effects, gene therapy is still a relatively new approach to disease treatment and additional adverse side effects could develop. More recently, there have been reports of significant adverse side effects, including muscle weakness and myocarditis, in clinical trials of other gene therapy treatments for Duchenne that may be related to the type and location of the specific gene mutation causing the disease. One clinical trial sponsor reported the death, preceded by hypovolemia and cardiogenic shock, of a non-ambulatory trial subject with advanced disease and cardiac dysfunction. There also is the potential risk of delayed adverse events following exposure to gene therapy products due to persistent biologic activity of the genetic material or other components of products used to carry the genetic material. Possible adverse side effects that may occur with treatment with gene therapy products include an immunologic reaction early after administration that could substantially limit the effectiveness of the treatment or represent safety risks for patients. Additionally, in previous clinical trials involving AAV vectors for gene therapy, some subjects experienced the development of a positive ELISPOT test associated with T-cell responses, which is of unclear clinical translatability. If T-cells are activated, the cellular immune response system may trigger the removal of transduced cells. If our gene transfer candidate demonstrates a similar effect, we may decide or be required to halt or delay further clinical development of SGT-003 or other future product candidates involving AAV vectors for gene therapy.

For example, as part of our SGT-001 preclinical program, we performed necessary good laboratory practices, or GLP, toxicology studies to establish the overall safety profile of SGT-001 in wild-type mice and non-human primates, or NHPs. The data and our conclusions from these studies were included in our IND submission to the FDA. Systemic administration of SGT-001 was generally well tolerated in both species. We observed no evidence of test-article-related toxicity for up to 13 weeks after systemic administration of SGT-001 in either species that would prevent us from initiating clinical trials. In the NHP study, test-article-related effects were self-limited, mild chemistry and hematology changes with no microscopic correlates at the end of the study. There was a transient and asymptomatic increase in liver function enzymes observed in NHPs starting on day 9, which returned to normal levels by day 21. We believe there were no other relevant test-article-related adverse events associated with SGT-001 administration in either GLP study. In the NHP toxicology study, a single animal from the high dose cohort was euthanized after it did not recover from an anesthetic procedure. We believe this event was attributed to procedural errors. However, AAV vector cannot be completely ruled out as a contributing factor to the toxicity that gave rise to the event.

In addition to side effects caused by SGT-001 and other current or future product candidates, including SGT-003, the administration process or related procedures also can cause adverse side effects. For example, integration of AAV DNA into the host cell’s genome has been reported to occur. Further, our AAV delivery system has not been validated in human clinical trials previously, and if such delivery system does not meet the safety criteria or cannot provide the desired efficacy results, then we may be forced to suspend or terminate our development of SGT-003. In addition, the relatively high anticipated dosing requirements for SGT-003 may amplify the risk of adverse side effects relating to the AAV vector. When James M. Wilson, M.D., Ph.D., resigned from our Scientific Advisory Board in early 2018 he cited emerging concerns about the possible risks of high systemic dosing of AAV. If any such adverse side effects were to occur in the future and we are unable to demonstrate that they were not caused by the administration process or related procedures, the FDA, the European Commission, the EMA or other regulatory authorities could order us to cease further development of, or deny approval of, SGT-003 or any other future product candidate for any or all targeted indications. Even if

we are able to demonstrate that any serious adverse events are not product-related, such occurrences could affect patient recruitment or the ability of enrolled patients to complete the clinical trial. Patients will also create antibodies to the AAV vector and a second administration of gene transfer might not be successful.

Additionally, if SGT-003 or other future product candidates receive marketing approval, the FDA could require us to adopt a Risk Evaluation and Mitigation Strategy, or REMS, to ensure that the benefits outweigh the risks, which may include, among other things, a medication guide outlining the risks of the product for distribution to patients and a communication plan to health care practitioners. Furthermore, if we or others later identify undesirable side effects caused by SGT-003 or other future product candidates, several potentially significant negative consequences could result, including:

In November 2019, the FDA placed a clinical hold on SGT-001 following a serious adverse event in IGNITE DMD. The third patient in the 2E14 vg/kg cohort of IGNITE DMD, dosed in late October 2019, experienced a serious adverse event deemed related to the study drug that was characterized by complement activation, thrombocytopenia, decrease in red blood cell count, acute kidney injury, and cardio-pulmonary insufficiency. In October 2020, the FDA lifted the clinical hold placed on IGNITE DMD. In connection with the lifting of the clinical hold, we determined to reduce the maximum weight of the next two patients dosed in IGNITE DMD to 18 kg per patient. Additionally, to mitigate the risk of serious drug-related adverse events, we amended the IGNITE DMD clinical protocol to include the prophylactic use of both anti-complement inhibitor eculizumab and C1 esterase inhibitor, and increase the prednisone dose in the first month post dosing. In March 2021, we announced that a seventh patient was safely dosed under the amended protocol, with transient and manageable adverse events, none of which were serious. In April 2021, an eighth patient was treated with SGT-001. The patient experienced a systemic inflammatory response which has since fully resolved. The event was classified as a serious adverse event and considered by the investigator to be drug related. This type of event is described in our Investigators Brochure and is not considered unexpected. Following dosing of these two patients with our second-generation manufacturing process and clinical strategy, we conducted an extensive review of all clinical data, which resulted in a strengthened risk mitigation plan including new patient management guidance. In November 2021, a ninth patient was safely dosed under the amended clinical protocol, with transient and manageable adverse events, none of which were serious. However, we cannot guarantee that similar serious adverse events or clinical holds will not happen in future clinical trials.

Delays in the completion of any clinical trial of SGT-003 or any other future product candidate, as a result of similar serious adverse events or clinical holds or otherwise, will increase our costs, slow down our product candidate development and approval process and delay or potentially jeopardize our ability to commence product sales and generate revenue. In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of SGT-003 or other future product candidates.

We will need to successfully complete clinical trials in order to obtain FDA approval to market SGT-003 or other future product candidates. We have limited experience in preparing, submitting and prosecuting regulatory filings, and have not previously submitted a biologics license application, or BLA, for any product candidate. We cannot be sure that submission of an IND will result in the FDA allowing clinical trials to begin or to begin as proposed, or that, once

begun, issues will not arise that suspend or terminate such clinical trials. Carrying out later-stage clinical trials and the submission of a successful BLA is a complicated process. This may be particularly true for design of a pivotal trial for the treatment of Duchenne as the FDA has not given clear guidance as to the necessary endpoints for approval of a treatment for Duchenne. In addition, we cannot be certain how many clinical trials of SGT-003 or other future product candidates will be required or how such trials should be designed. Consequently, we may be unable to successfully and efficiently execute and complete necessary clinical trials in a way that leads to BLA submission and approval of SGT-003 or other future product candidates. We may require more time and incur greater costs than our competitors and may not succeed in obtaining regulatory approvals of product candidates that we develop. Failure to commence or complete, or delays in, clinical trials, could prevent us from or delay us in commercializing SGT-003 and other future product candidates.

Results from preclinical studies or early clinical trials, including our IGNITE DMD clinical trial, are not necessarily predictive of future clinical trial results and are not necessarily indicative of final results. Our preclinical studies for SGT-003 in animals have been limited. We have only dosed a limited number of human subjects with SGT-001, and we have not dosed any human subjects with SGT-003. There is a high failure rate for gene therapy and biologic products proceeding through clinical trials. Many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in late-stage clinical trials even after achieving promising results in preclinical testing and earlier-stage clinical trials. Data obtained from preclinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory approval. We also may experience regulatory delays or rejections as a result of many factors, including due to changes in regulatory policy during the period of our product candidate development. SGT-003 or other future product candidates may fail to show the desired safety and efficacy in clinical development despite positive results in preclinical studies. This failure could cause us to abandon SGT-003 or other future product candidates.

From time to time, we may announce or publish preliminary or interim data from clinical trials. Positive preliminary or interim data may not be predictive of such trial’s subsequent or overall results. Preliminary or interim data are subject to the risk that one or more of the outcomes may materially change as more data become available. Additionally, preliminary or interim data 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. Therefore, positive preliminary or interim data in any ongoing clinical trial may not be predictive of such results in the completed 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 evaluate all data. As a result, preliminary or interim data that we report may differ from future results from the same clinical trials, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Preliminary or interim data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary or interim data we previously published. As a result, preliminary or interim data should be viewed with caution until the final data are available. Material adverse changes in the final data compared to preliminary or interim data could significantly harm our business prospects.

Before obtaining marketing approval from regulatory authorities for the sale of SGT-003 or other future product candidates, we must conduct extensive clinical trials to demonstrate the safety and efficacy of the product candidate for its intended indications. Clinical testing is expensive, time-consuming and uncertain as to outcome. We cannot guarantee that any clinical trials will be conducted as planned or completed on schedule, if at all. A failure of one or more clinical trials can occur at any stage of testing. Events that may prevent successful or timely completion of clinical development include:

Additionally, if the results of any clinical trials are inconclusive or if there are safety concerns or serious adverse events associated with SGT-003 or other future product candidates, we may:

Our product development costs will increase if we experience delays in testing or marketing approvals. In addition, if we make manufacturing or other changes to SGT-003 or other future product candidates, we may need to conduct additional studies to bridge our modified product candidates to earlier versions. We do not know whether any of our preclinical studies or clinical trials will begin as planned, will need to be restructured or will be completed on schedule, or at all. We may also determine to change the design or protocol of one or more of our clinical trials, which we have done in the past and which could result in delays. Significant preclinical study or clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize our product candidates.

We do not have the personnel capacity to conduct or manage the clinical trials that will be necessary for the development of SGT-003 or other future product candidates. For IGNITE DMD we are relying, and for any future clinical trials we expect we will rely, on third parties to assist us in managing, monitoring and conducting our clinical trials. If these third parties fail to comply with applicable regulations or do not adequately fulfill their obligations under the terms of our agreements with them, we may not be able to enter into alternative arrangements without undue delay or additional expenditures and, therefore, the clinical trials for SGT-003 or other future product candidates may be delayed or unsuccessful.

Furthermore, the FDA can be expected to inspect some or all of the clinical sites participating in our clinical trials to determine if our clinical trials are being conducted according to GCPs. If the FDA determines that these clinical sites are not in compliance with applicable regulations, we may be required to delay, repeat or terminate the clinical trials.

Identifying and qualifying patients to participate in any clinical trials of SGT-003 and other future product candidates are critical to our success. The timing of any clinical trials depends on our ability to recruit patients to participate as well as complete required follow-up periods. If patients are unwilling or unable to participate in our gene therapy clinical trials, including because of negative publicity from adverse events related to our product candidates, other approved gene therapies or the biotechnology or gene therapy fields, or due to competitive clinical trials for similar patient populations, clinical trials in products employing our vector or our platform or for other reasons, the timeline for recruiting patients, conducting clinical trials and obtaining regulatory approval of SGT-003 or our other product candidates may be delayed. We may also experience delays if patients withdraw from the clinical trial or do not complete the required monitoring period. Furthermore, we may face difficulties in recruiting patients to enroll in, or once enrolled, retaining patients in future clinical trials if they or their caretakers are affected by the COVID-19 virus or are fearful of traveling to, or are unable to travel to, our clinical trial sites because of the COVID-19 pandemic. These delays could result in increased costs, delays in advancing SGT-003 or other future product candidates, delays in testing the effectiveness of SGT-003 and other future product candidates or termination of clinical trials altogether.

We may not be able to identify, recruit and enroll a sufficient number of patients, or those with required or desired characteristics, to complete any clinical trials in a timely manner. Patient enrollment and trial completion is affected by many factors, including:

Our ability to successfully initiate, enroll and complete a clinical trial in any foreign country is subject to numerous risks unique to conducting business in foreign countries, including:

We cannot commercialize SGT-003 or other future product candidates until the appropriate regulatory authorities have reviewed and approved the product candidate. The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state and local statutes and regulations require the expenditure of substantial time and financial resources and we may not be able to obtain the required regulatory approvals. Even if our product candidates meet their safety and efficacy endpoints in clinical trials, the regulatory authorities may not complete their review processes in a timely manner, or we may not be able to obtain regulatory approval. Additional delays may result if an FDA advisory committee or other regulatory authority recommends non-approval or restrictions on approval. In addition, we may experience delays or rejections based upon additional government regulation from future legislation or administrative action or changes in regulatory authority policy during the period of product development, clinical trials and the regulatory review process.

Even if we receive regulatory approval, regulatory authorities may approve a product candidate for more limited indications than requested or they may impose significant limitations in the form of narrow indications, warnings or a REMS. Regulatory authorities may require precautions or contra-indications with respect to conditions of use or they may grant approval subject to the performance of costly post-marketing clinical trials. In addition, regulatory authorities may not approve the labeling claims that are necessary or desirable for the successful commercialization of our product candidates. Any of the foregoing scenarios could materially harm the commercial prospects for our product candidates.

Even if we obtain any regulatory approval for SGT-003 or other future product candidates, we will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, advertising, promotion, sampling, record-keeping and submission of safety and other post-market information. Any regulatory approvals that we receive for our product candidates may also be subject to a REMS, limitations on the approved indicated uses for which the product may be marketed or conditions of approval, or requirements for potentially costly post-marketing testing, including Phase IV clinical trials, and surveillance to monitor the quality, safety and efficacy of the product. Advertising and promotional materials must comply with FDA rules and are subject to FDA review, in addition to other potentially applicable federal and state laws.

In addition, later discovery of previously unknown adverse events or other problems with our products, manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may have various consequences, including:

In addition, manufacturers of approved products and those manufacturers’ facilities are required to comply with extensive FDA requirements, including ensuring that quality control and manufacturing procedures conform to cGMPs applicable to drug manufacturers or quality assurance standards applicable to medical device manufacturers, which include requirements relating to quality control and quality assurance as well as the corresponding maintenance of records and documentation and reporting requirements. We, any contract manufacturers we may engage in the future, our future collaborators and their contract manufacturers will also be subject to other regulatory requirements, including submissions of safety and other post-marketing information and reports, registration and listing requirements, requirements regarding the distribution of samples to clinicians, recordkeeping, and costly post-marketing studies or clinical trials and surveillance to monitor the safety or efficacy of the product such as the requirement to implement a REMS.

Non-compliance with European Union requirements regarding safety monitoring or pharmacovigilance, and with requirements related to the development of products for the pediatric population, can also result in significant financial penalties. Similarly, failure to comply with the European Union’s requirements regarding the protection of personal information can also lead to significant penalties and sanctions. Further, similar restrictions apply to approved products in the EU. The holder of a marketing authorization is required to comply with a range of requirements applicable to the manufacturing, marketing, promotion and sale of medicinal products. These include: compliance with the EU’s stringent pharmacovigilance or safety reporting rules, which can impose post-authorization studies and additional monitoring obligations; the manufacturing of authorized medicinal products, for which a separate manufacturer’s license is mandator; and the marketing and promotion of authorized drugs, which are strictly regulated in the EU and are also subject to EU Member State laws.

Accordingly, assuming we, or our collaborators, receive marketing approval for one or more of our product candidates, we, and our collaborators, and our and their contract manufacturers will continue to expend time, money and effort in all areas of regulatory compliance, including manufacturing, production, product surveillance and quality control. If we, and our collaborators, are not able to comply with post-approval regulatory requirements, our or our collaborators’ ability to market any future products could be limited, which could adversely affect our ability to achieve or sustain profitability. Further, the cost of compliance with post-approval regulations may have a negative effect on our operating results and financial condition.

Even if we receive FDA approval of SGT-003 or other future product candidates in the United States, approval of a product candidate in the United States by the FDA does not ensure approval of such product candidate by regulatory authorities in other countries or jurisdictions, and approval by one foreign regulatory authority does not ensure approval by regulatory authorities in other foreign countries or by the FDA. Future

sales of our product candidates outside of the United States will be subject to foreign regulatory requirements governing clinical trials, manufacturing and marketing approval. Approval procedures vary among jurisdictions and can involve requirements and administrative review periods different from, and more onerous than, those in the United States, including additional preclinical studies or clinical trials. In many countries outside the United States, a product candidate must be approved for reimbursement before it can be approved for sale in that country. We intend to submit a marketing authorization application, or MAA, to the EMA for approval of SGT-003 in the European Union, but obtaining such approval from the European Commission following the opinion of the EMA is a lengthy and expensive process. Regulatory authorities in countries outside of the United States and the European Union also have requirements for approval of product candidates with which we must comply prior to marketing in those countries. Obtaining foreign regulatory approvals and compliance with foreign regulatory requirements could result in significant delays, difficulties and costs for us and could delay or prevent the introduction of SGT-003 or other future product candidates in certain countries.

Further, clinical trials conducted in one country may not be accepted by regulatory authorities in other countries. Also, regulatory approval for SGT-003 or other future product candidates may be withdrawn. If we fail to comply with the regulatory requirements, our target market will be reduced, and our ability to realize the full market potential of our product candidates will be harmed.

Additionally, we could face heightened risks with respect to seeking marketing approval in the United Kingdom as a result of Brexit. The United Kingdom is no longer part of the European Single Market and European Union Customs Union. As of January 1, 2021, the Medicines and Healthcare products Regulatory Agency, or the MHRA, became responsible for supervising medicines and medical devices in Great Britain, comprising England, Scotland and Wales under domestic law, whereas Northern Ireland will continue to be subject to European Union rules under the Northern Ireland Protocol. Any delay in obtaining, or an inability to obtain, any marketing approvals, as a result of Brexit or otherwise, may force us to restrict or delay efforts to seek regulatory approval in the United Kingdom for our product candidates, which could significantly and materially harm our business.

The FDA has established the Office of Tissues and Advanced Therapies, or the OTAT, within the Center for Biologics Evaluation and Research, or the CBER, to consolidate the review of gene therapy and related products, and has established the Cellular, Tissue and Gene Therapies Advisory Committee to advise CBER in its review. Gene therapy clinical trials conducted at institutions that receive funding for recombinant DNA research from the U.S. National Institutes of Health, or the NIH, also are potentially subject to review by the Office of Biotechnology Activities’ Recombinant DNA Advisory Committee, or the RAC; however, the NIH announced that the RAC will only publicly review clinical trials if the trials cannot be evaluated by standard oversight bodies and pose unusual risks. Although the FDA decides whether individual gene therapy protocols may proceed, the RAC public review process, if undertaken, can delay the initiation of a clinical trial, even if the FDA has reviewed the trial design and details and approved its initiation. Conversely, the FDA can put an IND on a clinical hold even if the RAC has provided a favorable review or an exemption from in-depth, public review. If we were to engage an NIH-funded institution to conduct a clinical trial, that institution’s institutional biosafety committee, or IBC, as well as its IRB would need to review the proposed clinical trial to assess the safety of the trial. In addition, adverse developments in clinical trials of gene therapy products conducted by others may cause the FDA or other oversight bodies to change the requirements for approval of our product candidates.

The FDA has issued various guidance documents regarding gene therapies, including final guidance documents released in January 2020 relating to chemistry, manufacturing and controls information for gene therapy INDs, gene therapies for rare diseases and gene therapies for retinal disorders. Although the FDA has indicated that these and other guidance documents it previously issued are not legally binding, we believe that our compliance with them is likely necessary to gain approval for any gene therapy product candidate we may develop. The guidance documents provide additional factors that the FDA will consider at each of the above stages of development and relate to, among other things, the proper preclinical assessment of gene therapies; the chemistry, manufacturing, and control information that should be included in an IND application; the proper design of tests to measure product potency in support of an IND or BLA application; and measures to observe delayed adverse effects in subjects who have been exposed to investigational gene therapies when the risk of such effects is high. Further, the FDA usually recommends that sponsors observe subjects for potential gene

therapy-related delayed adverse events for a 15-year period, including a minimum of five years of annual examinations followed by 10 years of annual queries, either in person or by questionnaire.

Further, for a gene therapy product, the FDA also will not approve the product if the manufacturer is not in compliance with good tissue practices, or GTP. These standards are found in FDA regulations and guidance that govern the methods used in, and the facilities and controls used for, the manufacture of human cells, tissues, and cellular and tissue based products, or HCT/Ps, which are human cells or tissue intended for implantation, transplant, infusion, or transfer into a human recipient. The primary intent of the GTP requirements is to ensure that cell and tissue based products are manufactured in a manner designed to prevent the introduction, transmission, and spread of communicable disease. FDA regulations also require tissue establishments to register and list their HCT/Ps with the FDA and, when applicable, to evaluate donors through screening and testing.

Similarly, the EMA may issue new guidelines concerning the development and marketing authorization for gene therapy products and require that we comply with these new guidelines. The grant of marketing authorization in the European Union for gene therapy products is governed by Regulation 1394/2007/EC on advanced therapy medicinal products, read in combination with Directive 2001/83/EC of the European Parliament and of the Council, commonly known as the Community code on medicinal products. Regulation 1394/2007/EC includes specific rules concerning the authorization, supervision, and pharmacovigilance of gene therapy medicinal products. Manufacturers of advanced therapy medicinal products must demonstrate the quality, safety, and efficacy of their products to the EMA, which provides an opinion regarding the MAA. The European Commission grants or refuses marketing authorization in light of the opinion delivered by the EMA.

Finally, ethical, social and legal concerns about gene therapy, genetic testing and genetic research could result in additional regulations or prohibiting the processes we may use. Federal and state agencies, congressional committees and foreign governments have expressed their intentions to further regulate biotechnology. More restrictive regulations or claims that our product candidates are unsafe or pose a hazard could prevent us from commercializing any products. New government requirements may be established that could delay or prevent regulatory approval of our product candidates under development. It is impossible to predict whether legislative changes will be enacted, regulations, policies or guidance changed, or interpretations by agencies or courts changed, or what the impact of such changes, if any, may be.

As we advance our product candidates through clinical development, we will be required to consult with these regulatory and advisory groups, and comply with applicable guidelines. These regulatory review committees and advisory groups and any new guidelines they promulgate may lengthen the regulatory review process, require us to perform additional studies, increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of SGT-003 or other future product candidates or lead to significant post-approval limitations or restrictions. Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential product to market could decrease our ability to generate sufficient product revenue.

Under the Orphan Drug Act, the FDA may designate a product candidate as an orphan drug if it is a drug or biologic intended to treat a rare disease or condition. A similar regulatory scheme governs approval of orphan products by the EMA in the European Union. Generally, if a product candidate with an orphan drug designation subsequently receives the first marketing approval for the indication for which it has such designation, the product is entitled to a period of marketing exclusivity, which precludes the FDA or the EMA from approving another marketing application for the same product for the same therapeutic indication for that time period. The applicable period is seven years in the United States and ten years in the European Union. The exclusivity period in the European Union can be reduced to six years if a product no longer meets the criteria for orphan drug designation, in particular if the product is sufficiently profitable so that market exclusivity is no longer justified.

In order for the FDA to grant orphan drug exclusivity to one of our products, the FDA must find that the product is indicated for the treatment of a condition or disease with a patient population of fewer than 200,000 individuals annually in the United States. The FDA may conclude that the condition or disease for which orphan drug exclusivity is sought does not meet this standard. Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different products can be approved for the same condition.

In addition, even after an orphan drug is approved, the FDA can subsequently approve the same product for the same condition if the FDA concludes that the later product is clinically superior in that it is shown to be safer, more effective or makes a major contribution to patient care. Orphan drug exclusivity may also be lost if the FDA or EMA determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the product to meet the needs of the patients with the rare disease or condition.

The FDA Reauthorization Act of 2017, or FDARA, requires that a drug sponsor demonstrate the clinical superiority of an orphan drug that is otherwise the same as a previously approved drug for the same rare disease in order to receive orphan drug exclusivity. FDARA reverses prior precedent holding that the Orphan Drug Act unambiguously requires that the FDA recognize the orphan exclusivity period regardless of a showing of clinical superiority. The FDA may further reevaluate the Orphan Drug Act and its regulations and policies. This may be particularly true in light of a decision from the Court of Appeals for the 11th Circuit in September 2021 finding that, for the purpose of determining the scope of exclusivity, the term “same disease or condition” means the designated “rare disease or condition” and could not be interpreted by the FDA to mean the “indication or use.” Thus, the Court of Appeals concluded that orphan drug exclusivity applies to the entire designated disease or condition rather than the “indication or use.” We do not know if, when, or how the FDA or Congress may change the orphan drug regulations and policies in the future, and it is uncertain how any changes might affect our business. Depending on what changes the FDA may make to its orphan drug regulations and policies, our business could be adversely impacted.

We may seek a breakthrough therapy designation for SGT-003 or other future product candidates; however, we cannot assure our stockholders that SGT-003 or other future product candidates will meet the criteria for that designation. A breakthrough therapy is defined as a therapy that is intended, alone or in combination with one or more other therapies, to treat a serious condition, and preliminary clinical evidence indicates that the therapy may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. For therapies and biologics that have been designated as breakthrough therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens. Therapies designated as breakthrough therapies by the FDA may also be eligible for priority review if supported by clinical data at the time the new drug application is submitted to the FDA.

Designation as a breakthrough therapy is within the discretion of the FDA. Accordingly, even if we believe that one of our product candidates meets the criteria for designation as a breakthrough therapy, the FDA may disagree and instead determine not to make such designation. Even if we receive breakthrough therapy designation, the receipt of such designation for a product candidate may not result in a faster development or regulatory review or approval process compared to drugs considered for approval under conventional FDA procedures and does not assure ultimate approval by the FDA. In addition, even if one or more of our product candidates qualifies as a breakthrough therapy, the FDA may later decide that the product candidate no longer meets the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.

We may seek approval of SGT-003 or other future product candidates using the FDA’s accelerated approval pathway. A product may be eligible for accelerated approval if it treats a serious or life-threatening condition and generally provides a meaningful advantage over available therapies. In addition, it must demonstrate 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, or IMM, that is reasonably likely to predict an effect on IMM or other clinical benefit. The FDA or other applicable regulatory agency makes the determination regarding whether a surrogate endpoint is reasonably likely to predict long-term clinical benefit. Given that expression of microdystrophin has not yet been established to predict long-term clinical benefit, it is not currently accepted, and it is possible the FDA and/or other applicable regulatory agencies could decide never to accept it, as a surrogate endpoint for the accelerated approval pathway.

As a condition of approval, the FDA may require that a sponsor of a drug or biologic product candidate receiving accelerated approval perform adequate and well-controlled post-marketing clinical trials. These confirmatory trials must be completed with due diligence. In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch of the product. Even if we do receive accelerated approval, we may not experience a faster development or regulatory review or approval process and receiving accelerated approval does not provide assurance of ultimate FDA approval.

We may seek a regenerative medicine advanced therapy designation, or RMAT, for some of our product candidates. A regenerative medicine advanced therapy is defined as cell therapies, therapeutic tissue engineering products, human cell and tissue products, and combination products using any such therapies or products. Gene therapies, including genetically modified cells, that lead to a durable modification of cells or tissues may meet the definition of a regenerative medicine therapy. The regenerative medicine advanced therapy program is intended to facilitate efficient development and expedite review of regenerative medicine advanced therapies, which are intended to treat, modify, reverse, or cure a serious or life-threatening disease or condition. A new drug application or a BLA for a regenerative medicine advanced therapy may be eligible for priority review or accelerated approval through (1) surrogate or intermediate endpoints reasonably likely to predict long-term clinical benefit or (2) reliance upon data obtained from a meaningful number of sites. Benefits of such designation also include early interactions with the FDA to discuss any potential surrogate or intermediate endpoint to be used to support accelerated approval. A regenerative medicine therapy that is granted accelerated approval and is subject to post-approval requirements may fulfill such requirements through the submission of clinical evidence, clinical studies, patient registries, or other sources of real world evidence, such as electronic health records; the collection of larger confirmatory data sets; or post-approval monitoring of all patients treated with such therapy prior to its approval.

Designation as a regenerative medicine advanced therapy is within the discretion of the FDA. Accordingly, even if we believe one of our product candidates meets the criteria for designation as a regenerative medicine advanced therapy, the FDA may disagree and instead determine not to make such designation. In any event, the receipt of a regenerative medicine advanced therapy designation for a product candidate may not result in a faster development process, review or approval compared to drugs considered for approval under conventional FDA procedures and does not assure ultimate approval by the FDA. In addition, even if one or more of our product candidates qualify as regenerative medicine advanced therapies, the FDA may later decide that the biological products no longer meet the conditions for qualification.

In the EU, we may seek PRIME designation for our product candidates in the future. PRIME is a voluntary program aimed at enhancing the EMA’s role to reinforce scientific and regulatory support in order to optimize development and enable accelerated assessment of new medicines that are of major public health interest with the potential to address unmet medical needs. The program focuses on medicines that target conditions for which there exists no satisfactory method of treatment in the EU or even if such a method exists, it may offer a major therapeutic advantage over existing treatments. PRIME is limited to medicines under development and not authorized in the EU and the applicant intends to apply for an initial marketing authorization application through the centralized procedure. To be accepted for PRIME, a product candidate must meet the eligibility criteria in respect of its major public health interest and therapeutic innovation based on information that is capable of substantiating the claims.

The benefits of a PRIME designation include the appointment of a Committee for Medicinal Products for Human Use rapporteur to provide continued support and help to build knowledge ahead of a marketing authorization application, early dialogue and scientific advice at key development milestones, and the potential to qualify products for accelerated review, meaning reduction in the review time for an opinion on approvability to be issued earlier in the application process. PRIME enables an applicant to request parallel EMA scientific advice

and health technology assessment advice to facilitate timely market access. Even if we receive PRIME designation for any of our product candidates, the designation may not result in a materially faster development process, review or approval compared to conventional EMA procedures. Further, obtaining PRIME designation does not assure or increase the likelihood of EMA’s grant of a marketing authorization.

With enactment of the Food and Drug Administration Safety and Innovation Act in 2012, Congress authorized the FDA to award priority review vouchers to sponsors of certain rare pediatric disease product applications that meet the criteria specified in the law. This provision is designed to encourage development of new drug and biological products for prevention and treatment of certain rare pediatric diseases. Specifically, under this program, a sponsor who receives an approval for a drug or biologic for a “rare pediatric disease” may qualify for a voucher that can be redeemed to receive a priority review of a subsequent marketing application for a different product. The sponsor of a rare pediatric disease drug product receiving a priority review voucher may transfer (including by sale) the voucher to another sponsor. The voucher may be further transferred any number of times before the voucher is used, as long as the sponsor making the transfer has not yet submitted the application.

In order to receive a priority review voucher upon BLA approval, the product must receive designation from the FDA as a product for a rare pediatric disease prior to submission of the marketing application. A “rare pediatric disease” is a disease that is serious or life-threatening, in which the serious or life-threatening manifestations primarily affect individuals aged from birth to 18 years and affects fewer than 200,000 people in the United States, or affects more than 200,000 people in the United States but there is no reasonable expectation that the cost of developing and making available in the United States a product for such disease or condition will be recovered from sales in the United States of such product. In addition to receiving rare pediatric disease designation, in order to receive a priority review voucher, the BLA must be given priority review, rely on clinical data derived from studies examining a pediatric population and dosages of the product intended for that population, not seek approval for a different adult indication in the original rare pediatric disease product application and be for a product that does not include a previously approved active ingredient

The passage of the 21st Century Cures Act in December 2016 extended the Rare Pediatric Disease Priority Review Voucher Program, authorizing the FDA to award vouchers through September 30, 2022, for drugs with rare pediatric disease designation granted by September 30, 2020. On September 30, 2020, Congress provided a short-term extension of the Priority Review Voucher Program. On December 27, 2020, the Rare Pediatric Disease Priority Review Voucher Program was further extended. Under the current statutory sunset provisions, after September 30, 2024, FDA may only award a voucher for an approved rare pediatric disease product application if the sponsor has rare pediatric disease designation for the drug, and that designation was granted by September 30, 2024. After September 30, 2026, FDA may not award any rare pediatric disease priority review vouchers. If we do not obtain approval of a BLA by these dates, and if the Rare Pediatric Disease Priority Review Voucher Program is not further extended by congressional action, we may not receive a Priority Review Voucher.

If a therapy is intended for the treatment of a serious condition and nonclinical or clinical data demonstrate the potential to address unmet medical need for this condition, a drug sponsor may apply for FDA fast track designation. However, fast track designation does not ensure that we will receive marketing approval or that approval will be granted within any particular timeframe. We may not experience a faster development or regulatory review or approval process with fast track designation compared to conventional FDA procedures. In addition, the FDA may withdraw fast track designation if it believes that the designation is no longer supported by data from our clinical development program. Fast track designation alone does not guarantee qualification for the FDA’s priority review procedures.

If the FDA determines that a product candidate offers a treatment for a serious condition and, if approved, the product would provide a significant improvement in safety or effectiveness, the FDA may designate the product candidate for priority review. A priority review designation means that the goal for the FDA to review an application is six months, rather than the standard review period of ten months. We may request priority review for our product candidates, however, we cannot assume that SGT-003 or other future product candidates will meet the criteria for that designation. The FDA has broad discretion with respect to whether or not to grant priority review status to a product candidate, so even if we believe a particular product candidate is eligible for such designation or status, the FDA may decide not to grant it. Moreover, a priority review designation does not necessarily mean a faster development or regulatory review or approval process or necessarily confer any advantage with respect to approval compared to conventional FDA procedures. Receiving priority review from the FDA does not guarantee approval within the six-month review cycle or at all.

The ability of the FDA 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. Average review times at the agency have fluctuated in recent years as a result. Disruptions at the FDA and other agencies may also slow the time necessary for new product candidates to be reviewed and/or approved by necessary government agencies, which would adversely affect our business. In addition, government funding of the SEC and other government agencies on which our operations may rely, including those 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 may also slow the time necessary for new product candidates to be reviewed and/or approved by necessary government agencies, which would adversely affect our business. For example, over the last several years the U.S. government has shut down several times and certain regulatory agencies, such as the FDA and the SEC, have had to furlough critical FDA, SEC and other government employees and stop critical activities. If a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business. Further, future government shutdowns could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.

Separately, in response to the COVID-19 pandemic, a number of companies in 2020 and 2021 announced receipt of complete response letters due to the FDA’s inability to complete required inspections for their applications. Following a period of false starts, and temporary suspensions due to the omicron variant, the FDA announced on February 2, 2022 that it would resume domestic inspections beginning on February 7, 2022, and indicated that it would conduct foreign inspections beginning in April 2022 on a prioritized basis. However, the FDA may not be able to continue its current pace and review timelines could be extended, including where a pre-approval inspection or an inspection of clinical sites is required and due to the ongoing COVID-19 pandemic and travel restrictions, the FDA is unable to complete such required inspections during the review period. Regulatory authorities outside the U.S. may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic and may experience delays in their regulatory activities.

We operate in a highly competitive segment of the biopharmaceutical market. We face competition from many different sources, including larger and better-funded pharmaceutical, specialty pharmaceutical and biotechnology companies, as well as from academic institutions, government agencies and private and public research institutions. Our product candidates, if successfully developed and approved, will compete with

established therapies as well as with new treatments that may be introduced by our competitors. There are a variety of product candidates, including gene therapies, in development for Duchenne. Many of our competitors have significantly greater financial, product candidate development, manufacturing and marketing resources than we do. Large pharmaceutical and biotechnology companies have extensive experience in clinical testing and obtaining regulatory approval for their products, and mergers and acquisitions within these industries may result in even more resources being concentrated among a smaller number of larger competitors. Smaller and other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties compete with us in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.

For example, we are aware of several companies and research institutions conducting clinicals trials of product candidates focused on systemic gene transfers for Duchenne, including Pfizer Inc. and Sarepta Therapeutics, Inc. with product candidates currently in Phase III clinical development, Genethon with a product candidate currently in Phase I/II/III clinical trial development, and REGENXBIO Inc., which has announced that it intends to start a Phase I/II clinical trial in the first half of 2023. In September 2022, Sarepta Therapeutics, Inc. announced that it had submitted a BLA for its gene therapy candidate SRP-9001 for the treatment of ambulant patients with Duchenne.

Our commercial opportunity could be reduced or eliminated if competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, have broader market acceptance, are more convenient or are less expensive than any product candidate that we may develop.

We are aware of several companies focused on developing gene therapies in various indications, as well as several companies addressing other methods for modifying genes and regulating gene expression. Any advances in gene therapy technology made by a competitor may be used to develop therapies that could compete against SGT-003 or any future gene therapy product candidates we develop.

The success of our business depends upon our ability to develop and commercialize SGT-003 and other future product candidates. Because we have limited resources, we may forego or delay pursuit of opportunities with certain programs or product candidates or for indications that later prove to have greater commercial potential than SGT-003 or other future product candidates. For example, in January 2020, in connection with implementing our strategic plan to create a leaner company focused on advancing SGT-001, we curtailed certain activities supporting our other research and development programs. Similarly, in April 2022, we announced a reorganization of our corporate operations to prioritize the advancement of our key programs, and we focused our research and development activities to those related to our SGT-001 and SGT-003 programs. Subsequent to that, in September 2022, we announced that we would be pausing activities for SGT-001.

In addition, in October 2020, we entered into a collaboration and license agreement with Ultragenyx, pursuant to which we granted Ultragenyx an exclusive worldwide license under certain intellectual property rights controlled by us to develop AAV8 or other clade E AAV variant pharmaceutical products that express our MD5 nNOS binding domain form of microdystrophin protein for the treatment of Duchenne and other disease indications resulting from a lack of functional dystrophin, which we refer to as the Licensed Products.

Our spending on current and future research and development programs may not yield any commercially viable product candidates. If we do not accurately evaluate the commercial potential for a particular product candidate, we may relinquish valuable rights to that product candidate through strategic collaborations, licensing or other arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate. Alternatively, we may allocate internal resources to a product candidate in a therapeutic area in which it would have been more advantageous to enter into a partnering arrangement. If any of these events occur, we may be forced to abandon our development efforts with respect to a particular product candidate or fail to develop a potentially successful product candidate.

In October 2020, we entered into a collaboration and license agreement with Ultragenyx, pursuant to which we granted Ultragenyx an exclusive worldwide license under certain intellectual property rights controlled by us to develop the Licensed Products.

While we have retained all rights to and are developing on our own SGT-003, we may in the future enter into development, distribution or marketing arrangements with third parties with respect to SGT-003 or future product candidates. Our likely collaborators for any such sales, marketing, distribution, development, licensing or broader collaboration arrangements include large and mid-size pharmaceutical companies, regional and national pharmaceutical companies and biotechnology companies. If we enter into any such arrangements with any third parties in the future, we will likely have limited control over the amount and timing of resources that our collaborators dedicate to the development or commercialization of our product candidates. Our ability to generate revenues from these arrangements will depend on our collaborators’ abilities and efforts to successfully perform the functions assigned to them in these arrangements.

Collaborations that we enter into, including our collaboration with Ultragenyx, may not be successful, and any success will depend heavily on the efforts and activities of such collaborators. Collaborations pose a number of risks, including the following:

Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner, or at all. If any collaborations that we enter into do not result in the successful development and commercialization of products or if one of our collaborators terminates its agreement with us, we may not receive any future research funding or milestone or royalty payments under the collaboration. If we do not receive the funding we expect under these agreements, our development of our product candidates could be delayed and we may need additional resources to develop our product candidates. All of the risks relating to product development, regulatory approval and commercialization described herein also apply to the activities of our collaborators.

Additionally, subject to its contractual obligations to us, if a collaborator of ours is involved in a business combination, the collaborator might deemphasize or terminate the development or commercialization of any product candidate licensed to it by us. If one of our collaborators terminates its agreement with us, we may find it more difficult to attract new collaborators and our perception in the business and financial communities could be adversely affected.

We may seek to establish strategic partnerships for developing SGT-003 or other future product candidates due to capital costs required to develop, manufacture and commercialize our product candidates. We may not be successful in our efforts to establish such strategic partnerships or other alternative arrangements because, among other things, our research and development pipeline may be insufficient, SGT-003 may be deemed to be at too early of a stage of development for collaborative effort or third parties may not view SGT-003 as having the requisite potential to demonstrate safety and efficacy. We cannot be certain that, following a strategic transaction, we will achieve an economic or business benefit that justifies such transaction. If we seek to but are unable to reach agreements with suitable collaborators on a timely basis, on acceptable terms or at all, we may have to curtail, reduce or delay the development of a product candidate, delay its potential commercialization, reduce the scope of any sales or marketing activities or increase our expenditures and undertake development, manufacturing or commercialization activities independently. If we elect to fund our own independent development or commercialization activities, we will need to obtain additional expertise and additional capital, which may not be available to us on acceptable terms or at all. If we fail to enter into collaborations and do not have sufficient funds or expertise to undertake the necessary development, manufacturing and commercialization activities, we may not be able to further develop SGT-003 or other future product candidates.

The manufacturing process we have used historically and the manufacturing process we plan to use in the future to produce our product candidates are complex and have not been validated for commercial use. We have limited experience manufacturing SGT-003 and other future product candidates. Building our own manufacturing facility, if we decide to do so in the future, would require substantial additional investment, would be time-consuming and may be subject to delays, including those resulting from compliance with regulatory requirements. In addition, building a manufacturing facility may cost more than we currently anticipate. Although we may establish our own manufacturing facility to support a commercial launch, if we are unable to do so or otherwise decide not to do so, we may be unable to produce commercial materials or meet demand, if any should develop, for SGT-003 and other future product candidates. Any such failure could delay or prevent our commercialization of SGT-003 or other future product candidates. The production of SGT-003 using both the process we have used historically and using a transient transfection-based process requires processing steps that are more complex than those required for most chemical pharmaceuticals. Moreover, unlike chemical pharmaceuticals, the physical and chemical properties of a gene transfer product candidate such as ours generally cannot be fully characterized. As a result, assays of the finished product may not be sufficient to ensure that the product will perform in the intended manner. Accordingly, we have and will continue to employ multiple steps to control our manufacturing process to assure that the process works and that SGT-003 is made strictly and consistently in compliance with the process. As a result of the limited number of FDA approvals for gene transfer products to date, the timeframe required for us to obtain approval for a cGMP gene therapy manufacturing facility in the United States is uncertain. We must supply all necessary documentation in support of a BLA or MAA on a timely basis and must adhere to the FDA’s and the European Union’s cGMP requirements before we can obtain marketing approval for SGT-003 and other future product candidates. In order to obtain approval, we will need to ensure that all of our processes, methods and equipment are compliant with cGMP requirements, and perform extensive audits of contract laboratories, manufacturers and suppliers.

We currently rely on third-party manufacturers for our SGT-003 supply. In order to produce sufficient quantities of SGT-003 for clinical trials and initial U.S. commercial demand, we have and will continue to further optimize and increase the capacity of our manufacturing process at our third-party manufacturers, and potentially through our own commercial scale manufacturing facility. We may need to make changes to our manufacturing processes, beyond implementation of a transient transfection-based manufacturing process, for SGT-003. We may not be able to produce sufficient quantities of SGT-003 due to several factors, including equipment malfunctions, facility contamination, material shortages or contamination, natural disasters, a public health issue (for example, an outbreak of a contagious disease such as the COVID-19 pandemic), disruption in utility services, human error or disruptions in the operations of our suppliers. For example, we have not produced a manufacturing run for clinical supply utilizing the transient transfection-based manufacturing process and may experience variability with respect to the success and yield of these runs that will require continued engagement in process development activities to improve the reproducibility, reliability, quality and consistency of yields of the manufacturing process. While we expect to be able to produce for more than one patient from a single batch, additional manufacturing runs will be required to produce necessary or adequate supply for our future clinical trials of SGT-003 and there is no guarantee that all of those runs will be within specifications or produce adequate supply. If we are not able to produce sufficient supply on the timeline expected, our overall development schedule for SGT-003 could be delayed, and we could incur additional expense.

If supply from a manufacturing facility is interrupted, including as a result of equipment malfunctions, facility contamination, material shortages or contamination, natural disasters, the COVID-19 pandemic or another public health issue, disruption in utility services or human error, there could be a significant disruption in supply of SGT-003 or other future product candidates. In such instance, we may need to locate appropriate replacement third-party manufacturers, and we may not be able to enter into arrangements with such additional third-party manufacturers on favorable terms or at all. Use of new third-party manufacturers could increase the risk of delays in production or insufficient supplies of our product candidates as we transfer our manufacturing technology to these manufacturers and as they gain experience manufacturing our product candidates.

In addition, product manufacturers and their facilities are subject to payment of user fees and continual review and periodic inspections by the FDA and other regulatory authorities for compliance with cGMP requirements and adherence to commitments made in the BLA or foreign marketing application. If we, or a

regulatory authority, discover 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, a regulatory authority may impose restrictions relative to that product, the manufacturing facility or us, including requiring recall or withdrawal of the product from the market or suspension of manufacturing.

In addition, the FDA, the EMA and other foreign regulatory authorities may require us to submit samples of any lot of any approved product together with the protocols showing the results of applicable tests at any time. Under some circumstances, the FDA, the EMA or other foreign regulatory authorities may require that we not distribute a lot until the agency authorizes its release. Lot failures or product recalls could cause us to delay or abandon clinical trials or product launches.

We also may encounter problems hiring and retaining the experienced specialist scientific, quality control and manufacturing personnel needed to operate our manufacturing process, which could result in delays in our production or difficulties in maintaining compliance with applicable regulatory requirements.

Any problems in our manufacturing process or facilities could make us a less attractive collaborator for potential partners, including larger pharmaceutical companies and academic research institutions, which could limit our access to additional attractive development programs. Problems in our manufacturing process or facilities also could restrict our ability to meet market demand for SGT-003, other future product candidates or future product candidates.

Until such time, if ever, as we establish a manufacturing facility that has been properly validated to comply with FDA cGMP requirements, we will not be able to independently manufacture material for our current and future clinical programs. For clinical trials of SGT-001, we have utilized, and expect to continue to utilize, and for clinical trials of SGT-003 and other future product candidates, we expect to utilize, materials manufactured by cGMP-compliant third-party suppliers. Even following our potential establishment of a validated cGMP manufacturing facility, we intend to utilize third-party manufacturing capabilities in order to provide multiple sources of supply. In the event that the establishment of our own manufacturing facility is delayed or not otherwise pursued and if these third-party manufacturers do not successfully carry out their contractual duties, meet expected deadlines or manufacture SGT-003 and other future product candidates in accordance with regulatory requirements or if there are disagreements between us and these third-party manufacturers, we may not be able to complete, or may be delayed in completing, the clinical trials required for approval of SGT-003 and other future product candidates. In such instances, we may need to locate an appropriate replacement third-party relationship, which may not be readily available or on acceptable terms, which would cause additional delay or increased expense prior to the approval of our product candidates.

Additionally, we rely on our third-party manufacturers for their compliance with the cGMP and their maintenance of adequate quality control, quality assurance and qualified personnel. Furthermore, all of our third-party suppliers and manufacturers are engaged with other companies to supply and/or manufacture materials or products for such companies, which exposes them to regulatory risks for the production of such materials and products. FDA inspections may identify compliance issues at third-party manufacturer facilities or at the facilities of third-party suppliers that may disrupt production or distribution, or require substantial resources to correct and prevent recurrence of any deficiencies, and could result in fines or penalties by regulatory authorities. In addition, discovery of 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 BLA, including withdrawal or recall of the product from the market or other voluntary, FDA-initiated or judicial action, including fines, injunctions, civil penalties, license revocations, seizure, total or partial suspension of production or criminal penalties, any of which could significantly and adversely affect supplies of our product candidates.

In addition, we do not currently have long-term supply or manufacturing arrangements in place for the production of SGT-003 or other future product candidates at commercial scale. Although we intend to establish additional sources for long-term supply, potentially including our own commercial-scale cGMP-compliant manufacturing facility and one or more third-party manufacturers, if the gene therapy industry were to grow, we may encounter increasing competition for the materials necessary for the production of SGT-003 or other future product candidates. We may experience difficulties in scaling up production beyond clinical batches. Furthermore, demand for third-party cGMP manufacturing facilities may grow at a faster rate than existing

manufacturing capacity, which could disrupt our ability to find and retain third-party manufacturers capable of producing sufficient quantities of SGT-003 or other future product candidates for future clinical trials or to meet initial commercial demand in the United States. We currently rely, and expect to continue to rely, on additional third parties to manufacture materials for our product candidates and to perform quality testing. Even following the potential establishment of our own cGMP-compliant manufacturing capabilities, we intend to maintain third-party manufacturers for these materials, as well as to serve as additional sources of SGT-003 and other future product candidates, which will expose us to risks including:

Any of these events could lead to clinical trial delays or failure to obtain regulatory approval or impact our ability to successfully commercialize SGT-003 or other future product candidates. Some of these events could be the basis for FDA action, including injunction, recall, seizure or total or partial suspension of product manufacture.

We currently have no sales, distribution or marketing organization. To successfully commercialize any product candidate that may result from our development programs, we will need to develop these capabilities, either on our own or with others. The establishment and development of our own commercial team or the establishment of a contract sales force to market any product candidate we may develop will be expensive and time-consuming and could delay any product launch. Moreover, we cannot be certain that we will be able to successfully develop this capability. We may enter into collaborations regarding SGT-003 and other future product candidates with other entities to utilize their established marketing and distribution capabilities, but we may be unable to enter into such agreements on favorable terms, if at all. If any future collaborators do not commit sufficient resources to commercialize our product candidates, or we are unable to develop the necessary capabilities on our own, we will be unable to generate sufficient product revenue to sustain our business. We compete with many companies that currently have extensive, experienced and well-funded sales, distribution and marketing operations to recruit, hire, train and retain marketing and sales personnel. We also face competition in our search for third parties to assist us with the sales and marketing efforts of SGT-003 and other future product candidates. Without an internal team or the support of a third party to perform marketing and sales functions, we will be unable to compete successfully against these more established companies.

We currently have no medical affairs team. If we are unable to successfully build a medical affairs team to address scientific and medical questions and provide expert guidance and education in the application, administration and utilization of SGT-003 and other future product candidates to physicians, we may not be able to establish an educated market for our products. The establishment and development of our own medical affairs team will be expensive and time-consuming and could delay any product launch. Moreover, we cannot be certain that we will be able to successfully develop this capability.

We currently focus our research and product development on treatments for Duchenne. Our understanding of the patient population with this disease is based on estimates in published literature and by Duchenne foundations. These estimates may prove to be incorrect and new studies may reduce the estimated incidence or

prevalence of this disease. The number of patients in the United States, the European Union and elsewhere may turn out to be lower than expected, patients may not be otherwise amenable to treatment with our product candidate or patients may become increasingly difficult to identify and access.

Further, there are several factors that could contribute to making the actual number of patients who receive SGT-003 less than the potentially addressable market. These include the lack of widespread availability of, and limited reimbursement for, new therapies in many underdeveloped markets. Further, the severity of the progression of a degenerative disease such as Duchenne up to the time of treatment will likely diminish the therapeutic benefit conferred by a gene therapy due to irreversible cell damage.

As with many AAV-mediated gene therapy approaches, certain patients’ immune systems might prohibit the successful delivery of certain gene therapy products, thereby potentially limiting the population of patients amenable to gene transfer. While we are working to better understand the prevalence of antibodies to AAV, or seroprevalence, as it relates to gene therapies for Duchenne, the exact Duchenne-wide seroprevalence is currently unknown and it varies by AAV serotype and age. We may not be able to address this potentially limiting factor for gene therapy as a treatment for certain patients.

Even with the requisite approvals from the FDA in the United States, the European Commission in the European Union and other regulatory authorities internationally, the commercial success of SGT-003 will depend, in part, on the acceptance of physicians, patients and health care payors of gene therapy products in general, and SGT-003, as applicable, in particular, as medically necessary, cost-effective and safe. Any product that we commercialize may not gain acceptance by physicians, patients, health care payors and others in the medical community due to ethical, social, medical and legal concerns. If these products do not achieve an adequate level of acceptance, we may not generate significant product revenue and may not become profitable. The degree of market acceptance of gene therapy products and, in particular, SGT-003, if approved for commercial sale, will depend on multiple factors, including:

Even if a potential product candidate displays a favorable efficacy and safety profile in preclinical studies and clinical trials, market acceptance of the product will not be fully known until after it is launched.

Our efforts to educate the medical community and third-party payors on the benefits of SGT-003 and other future product candidates may require significant resources and may never be successful. Such efforts may require more resources than are typically required due to the complexity and uniqueness of our potential product candidates. If SGT-003 or other future product candidates are approved but fail to achieve market acceptance among physicians, patients or third-party payors, we will not be able to generate significant revenue from any such product.

Gene transfer remains a novel technology and public perception may be influenced by claims that gene transfer is unsafe, and gene transfer may not gain the acceptance of the public or the medical community. In particular, our success will depend upon physicians who specialize in the treatment of Duchenne prescribing treatments that involve the use of SGT-003 in lieu of, or in addition to, other treatments with which they are more familiar and for which greater clinical data may be available. More restrictive government regulations or negative public opinion may delay or impair the development and commercialization of SGT-003 or demand for any product candidate we may develop. A public backlash developed against gene therapy following the death of a patient in 1999 during a gene therapy clinical trial of research subjects with ornithine transcarbamylase, or OTC, deficiency, a rare disorder in which the liver lacks a functional copy of the OTC gene. The death of the clinical trial subject was due to complications of adenovirus vector administration. Dr. James M. Wilson, former chair of our Scientific Advisory Board, was a co-investigator of the 1999 trial while he was Director of the Institute for Human Gene Therapy of the University of Pennsylvania. Serious adverse events in our clinical trials, including the events that led to the previously-lifted clinical holds on IGNITE DMD or other clinical trials involving gene transfer products or our competitors’ products, even if not ultimately attributable to the relevant product candidates, and the resulting publicity, could result in increased government regulation, unfavorable public perception, potential regulatory delays in the testing or approval of SGT-003, stricter labeling requirements for SGT-003 if approved and a decrease in demand for SGT-003.

Given the nature of biologics manufacturing, there is a risk of contamination in our manufacturing processes. Any contamination could materially adversely affect our ability to produce SGT-003 on schedule and could cause reputational damage.

Some of the materials required in our manufacturing process are derived from biologic sources. Such materials are difficult to procure and may be subject to contamination or recall. A material shortage, contamination, recall or restriction on the use of biologically derived substances in the manufacture of SGT-003 could adversely impact or disrupt the commercial manufacturing or the production of clinical material, which could materially and adversely affect our development timelines.

There is significant uncertainty related to third-party coverage and reimbursement of newly approved products. We expect the cost of a single administration of gene transfer products, such as those we are developing, to be substantial, when and if they achieve regulatory approval. We expect that coverage and reimbursement by government and private payors will be essential for most patients to be able to afford these treatments. Accordingly, sales of SGT-003 or other future product candidates, if approved, will depend substantially, both domestically and abroad, on the extent to which the costs of such product candidates will be paid by health maintenance, managed care, pharmacy benefit and similar health care management organizations,

or will be reimbursed by government authorities, private health coverage insurers and other third-party payors. Coverage and reimbursement by a third-party payor may depend upon several factors, including the third-party payor’s determination that use of a product is:

Obtaining coverage and reimbursement for a product from third-party payors is a time-consuming and costly process that could require us to provide to the payor supporting scientific, clinical and cost-effectiveness data. If coverage and reimbursement are not available, or are available only at limited levels, we may not be able to successfully commercialize SGT-003 and other future product candidates. Even if coverage is provided, the approved reimbursement amount may not be adequate to realize a sufficient return on our investment.

To our knowledge, only a limited number of gene transfer products have been approved for coverage and reimbursement by the Centers for Medicare & Medicaid Services, or the CMS, the agency responsible for administering the Medicaid program. It is difficult to predict what the CMS will decide with respect to coverage and reimbursement for fundamentally novel products such as ours, as there is no body of established practices and precedents for these types of products either in the United States or the European Union. For example, several cancer drugs have been approved for reimbursement in the United States and have not been approved for reimbursement in certain European Union member states and vice versa. It is difficult to predict what third-party payors will decide with respect to the coverage and reimbursement for SGT-003 and other future product candidates.

Outside the United States, international operations generally are subject to extensive government price controls and other market regulations, and increasing emphasis on cost-containment initiatives in the European Union, Canada and other countries may put pricing pressure on us. In general, the prices of therapeutics outside the United States are substantially lower than in the United States. Other countries may allow companies to fix their own prices for therapeutics, but monitor and control company profits. Additional foreign price controls or other changes in pricing regulations could restrict the amount that we are able to charge for our product candidates. Accordingly, in markets outside the United States, the reimbursement for our product candidates may be reduced compared with the United States and may be insufficient to generate commercially reasonable product revenue.

Additionally, in countries where the pricing of gene therapy products is subject to governmental control, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product. Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after reimbursement has been obtained. Reference pricing used by various European Union member states and parallel distribution, or arbitrage between low-priced and high-priced member states, can further reduce prices. To obtain reimbursement or pricing approval in some countries, we may be required to conduct a clinical trial that compares the cost-effectiveness of our product candidate to other available therapies. Reimbursement of our products may be unavailable or limited in scope or amount, which would adversely affect our revenue, if any.

We expect that we will be subject to additional risks in commercializing SGT-003 and other future product candidates outside the United States, including:

The failure to comply with applicable foreign regulatory requirements may result in, among other things, fines, suspension, variation or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

We may evaluate various acquisitions and strategic collaborations, including licensing or acquiring complementary products, intellectual property rights, technologies or businesses. Any potential acquisition or strategic collaboration may entail numerous risks, including:

In addition, if we undertake acquisitions, we may issue dilutive securities, assume or incur debt obligations, incur large one-time expenses and acquire intangible assets that could result in significant future amortization expense. Moreover, we may not be able to locate suitable acquisition or collaboration opportunities and this inability could impair our ability to grow or obtain access to technology or products that may be important to the development of our business.

We are highly dependent on members of our executive team, the loss of whose services may adversely impact the achievement of our objectives. While we have entered into employment agreements with certain of our executive officers, any of them could leave our employment at any time. We currently do not have “key person” insurance on any of our employees. The loss of the services of one or more of our current key employees might impede the achievement of our research, development and commercialization objectives.

Recruiting and retaining other qualified employees, consultants and advisors for our business, including scientific and technical personnel, also will be critical to our success. There currently is a shortage of skilled individuals with substantial gene therapy experience, which is likely to continue. As a result, competition for skilled personnel, including in gene therapy research and vector manufacturing, is intense and the turnover rate can be high. We may not be able to attract and retain personnel on acceptable terms given the competition among numerous pharmaceutical and biotechnology companies and academic institutions for individuals with similar skill sets. In addition, the failure to succeed in preclinical or clinical trials or applications for marketing approval may make it more challenging to recruit and retain qualified personnel. The inability to recruit, or loss of services of certain executives, key employees, consultants or advisors, may impede the progress of our research, development and commercialization objectives.

In April 2022, we announced a reduction in workforce by approximately 35% as part of a strategic plan designed to streamline our operating structure and better leverage external manufacturing expertise. We may not realize, in full or in part, the anticipated benefits, savings and improvements in our cost structure from our restructuring efforts due to unforeseen difficulties, delays or unexpected costs. If we are unable to realize the expected operational efficiencies and cost savings from the restructuring, our operating results and financial condition would be adversely affected. We also cannot guarantee that we will not have to undertake additional workforce reductions or restructuring activities in the future. Furthermore, our strategic restructuring plan may be disruptive to our operations. For example, our workforce reductions could yield unanticipated consequences, such as attrition beyond planned staff reductions, or increase difficulties in our day-to-day operations. Our workforce reductions could also harm our ability to attract and retain qualified management, scientific, clinical, manufacturing and sales and marketing personnel who are critical to our business. Any failure to attract or retain qualified personnel could prevent us from successfully developing and commercializing our product candidates in the future.

If we are successful in executing our business strategy, we will need to expand our managerial, operational, financial and other systems and resources to manage our operations, continue our research and development activities and, in the longer term, build a commercial infrastructure to support commercialization of SGT-003 and any other future product candidate that is approved for sale. Future growth would impose significant added responsibilities on members of management. It is likely that our management, finance, development personnel, systems and facilities currently in place may not be adequate to support this future growth. Our need to effectively manage our operations, growth and any future product candidates requires that we continue to develop more robust business processes and improve our systems and procedures in each of these areas and to attract and retain sufficient numbers of talented employees. We may be unable to successfully implement these tasks on a larger scale and, accordingly, may not achieve our research, development and growth goals.

We are exposed to the risk of employee fraud or other misconduct, including intentional failures to comply with FDA regulations or similar regulations of comparable foreign regulatory authorities, provide accurate information to the FDA or comparable foreign regulatory authorities, comply with manufacturing standards, comply with federal and state healthcare fraud and abuse laws and regulations and similar laws and regulations established and enforced by comparable foreign regulatory authorities, report financial information or data accurately or disclose unauthorized activities to us. Employee misconduct could also involve the improper use of information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation. This could include violations of the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, other U.S. federal and state law, and requirements of non-U.S. jurisdictions, including the European Union Data Protection Directive. It is not always possible to identify and deter employee misconduct, 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, standards, regulations, guidance or codes of

conduct. 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 results of operations, including the imposition of significant fines or other sanctions.

Our business and financial prospects could be affected by changes in health care spending and policy in the United States and abroad. We operate in a highly regulated industry and new laws or judicial decisions, or new interpretations of existing laws or decisions, related to health care availability, the method of delivery or payment for health care products and services could negatively impact our business, operations and financial condition.

For example, in the United States there is significant interest in promoting health care reform, as evidenced by the enactment of the Patient Protection and Affordable Care Act and the companion Health Care and Education Reconciliation Act, or the Health Care Reform Law. The Health Care Reform Law increased federal oversight of private health insurance plans and included a number of provisions designed to reduce Medicare expenditures and the cost of health care generally, to reduce fraud and abuse, and to provide access to increased health coverage.

The Health Care Reform Law also imposed substantial changes to the U.S. system for paying for health care, including programs to extend medical benefits to millions of individuals who have lacked insurance coverage. Generally, implementation of the Health Care Reform Law has thus far included significant cost-saving, revenue and payment reduction measures with respect to, for example, several government health care programs that might cover our products in the United States, should they be commercialized, including Medicaid and Medicare. Additional downward pricing pressure associated with the Health Care Reform Law includes that the Health Care Reform Law established and provided significant funding for a Patient-Centered Outcomes Research Institute to coordinate and fund Comparative Effectiveness Research, as those terms are defined in the Health Care Reform Law. While the stated intent of Comparative Effectiveness Research is to develop information to guide providers to the most efficacious therapies, outcomes of Comparative Effectiveness Research could influence the reimbursement or coverage for therapies that are determined to be less cost-effective than others. Should any of our products be approved for sale, but then determined to be less cost-effective than alternative therapies, the levels of reimbursement for these products, or the willingness to reimburse at all, could be adversely impacted.

In addition to legislative changes resulting from the passage of the Health Care Reform Law, other legislative changes have been proposed and adopted since the Health Care Reform Law was enacted. In August 2011, the Budget Control Act of 2011, among other things, created measures for spending reductions by Congress. A Joint Select Committee on Deficit Reduction, tasked with recommending a targeted deficit reduction of at least $1.2 trillion for the years 2013 through 2021, was unable to reach required goals, thereby triggering the legislation’s automatic reduction to several government programs. These changes included aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2029 unless additional Congressional action is taken. The Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, suspended the 2% Medicare sequester from May 1, 2020 through December 31, 2020, and extended the sequester through 2031. These Medicare sequester reductions were suspended through the end of March 2022. From April 2022 through June 2022, a 1% sequester cut was in effect, with the full 2% cut resuming as of July 1, 2022. The American Taxpayer Relief Act of 2012, among other things, reduced Medicare payments to several providers and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. These new laws may result in additional reductions in Medicare and other healthcare funding and otherwise affect the prices we may obtain for any of our product candidates for which we may obtain regulatory approval or the frequency with which any such product candidate is prescribed or used.

Since enactment of the Health Care Reform Law, there have been, and continue to be, numerous legal challenges and Congressional actions to repeal and replace provisions of the law. For example, with enactment of the Tax Cuts and Jobs Act of 2017, or the TCJA, Congress repealed the “individual mandate.” The repeal of this provision of the Health Care Reform Law, which requires most Americans to carry a minimal level of health insurance, became effective in 2019. Further, on December 14, 2018, a U.S. District Court judge in the Northern District of Texas ruled that the individual mandate portion of the Health Care Reform Law is an essential and inseverable feature of the Health Care Reform Law, and therefore because the mandate was repealed as part of the TCJA, the remaining provisions of the Health Care Reform Law are invalid as well. The U.S. Supreme Court heard this case on November 10, 2020 and on June 17, 2021, dismissed this action after finding that the plaintiffs do not have standing to challenge the constitutionality of the statute. It is unclear how such litigation

and other efforts to repeal and replace the Health Care Reform Law will impact the Health Care Reform Law and our business. Litigation and legislation over the Health Care Reform Law are likely to continue, with unpredictable and uncertain results.

Although the previous administration took actions to undermine or delay implementation of the Health Care Reform Law, those policies President Biden rescinded those actions with the issuance of an Executive Order on January 28, 2021 which directs federal agencies to reconsider rules and other policies that limit Americans’ access to health care, and consider actions that will protect and strengthen that access. Under this Executive Order, federal agencies are directed to re-examine policies that undermine protections for people with pre-existing conditions, including complications related to COVID-19; demonstrations and waivers under Medicaid and the Health Care Reform Law that may reduce coverage or undermine the programs, including work requirements; policies that undermine the Health Insurance Marketplace or other markets for health insurance; policies that make it more difficult to enroll in Medicaid and the Health Care Reform Law; and policies that reduce affordability of coverage or financial assistance, including for dependents. This Executive Order also directs the U.S. Department of Health and Human Services to create a special enrollment period for the Health Insurance Marketplace in response to the COVID-19 pandemic.

With enactment of the TCJA, Congress repealed the “individual mandate.” The repeal of this provision, which requires most Americans to carry a minimal level of health insurance, became effective in 2019. Additionally, the 2020 federal spending package permanently eliminated, effective January 1, 2020, the Health Care Reform Law-mandated “Cadillac” tax on high-cost employer-sponsored health coverage and medical device tax and, effective January 1, 2021, also eliminates the health insurer tax. Further, the Bipartisan Budget Act of 2018, among other things, amended the Health Care Reform Law, effective January 1, 2019, to increase the point-of-sale discount that is owed by pharmaceutical manufacturers who participate in Medicare Part D and to close the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole.” Congress may consider other legislation to replace elements of the Health Care Reform Law.

In addition, the CMS has proposed regulations that would give states greater flexibility in setting benchmarks for insurers in the individual and small group marketplaces, which may have the effect of relaxing the essential health benefits required under the Health Care Reform Law for plans sold through such marketplaces. On November 30, 2018, CMS announced a proposed rule that would amend the Medicare Advantage and Medicare Part D prescription drug benefit regulations to reduce out-of-pocket costs for plan enrollees and allow Medicare plans to negotiate lower rates for certain drugs. Among other things, the proposed rule changes would allow Medicare Advantage plans to use preauthorization, or PA, and step therapy, or ST, for six protected classes of drugs, with certain exceptions; permit plans to implement PA and ST in Medicare Part B drugs; and change the definition of “negotiated prices” as well as add a definition of “price concession” in the regulations. It is unclear whether these proposed changes will be accepted, and if so, what effect such changes will have on our business.

The prices of prescription pharmaceuticals have been the subject of considerable discussion in the United States. To date, there have been several recent U.S. congressional inquiries, as well as proposed and enacted state and federal legislation designed to, among other things, bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient programs, reduce the costs of drugs under Medicare and reform government program reimbursement methodologies for products. In 2020, CMS issued an interim final rule implementing a most favored nation model for prices that would tie Medicare Part B payments for certain physician-administered pharmaceuticals to the lowest price paid in other economically advanced countries, effective January 1, 2021. That rule, however, has been subject to a nationwide preliminary injunction and, on December 29, 2021, CMS issued a final rule to rescind it. With issuance of this rule, CMS stated that it will explore all options to incorporate value into payments for Medicare Part B pharmaceuticals and improve beneficiaries' access to evidence-based care.

In addition, in October 2020, HHS and the FDA published a final rule allowing states and other entities to develop a Section 804 Importation Program, or SIP, to import certain prescription drugs from Canada into the United States. The final rule is currently the subject of ongoing litigation, but at least six states (Vermont, Colorado, Florida, Maine, New Mexico, and New Hampshire) have passed laws allowing for the importation of drugs from Canada with the intent of developing SIPs for review and approval by the FDA. Further, on November 20, 2020, HHS finalized a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law. The

implementation of the rule has been delayed by the Biden administration from January 1, 2022 to January 1, 2023 in response to ongoing litigation. The rule also creates a new safe harbor for price reductions reflected at the point-of-sale, as well as a new safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers, the implementation of which have also been delayed by the Biden administration until January 1, 2023.

On July 9, 2021, President Biden signed Executive Order 14063, which focuses on, among other things, the price of pharmaceuticals. To address these costs, the Order directs HHS to create a plan within 45 days to combat “excessive pricing of prescription drugs and enhance domestic pharmaceutical supply chains, to reduce the prices paid by the federal government for such drugs, and to address the recurrent problem of price gouging.” On September 9, 2021, HHS released its plan to reduce drug prices. The key features of that plan are to: (a) make drug prices more affordable and equitable for all consumers and throughout the health care system by supporting drug price negotiations with manufacturers; (b) improve and promote competition throughout the prescription drug industry by supporting market changes that strengthen supply chains, promote biosimilars and generic drugs, and increase transparency; and (c) foster scientific innovation to promote better healthcare and improve health by supporting public and private research and making sure that market incentives promote discovery of valuable and accessible new treatments.

More recently, with passage of the Inflation Reduction Act in August 2022, Congress authorized Medicare beginning in 2026 to negotiate lower prices for certain costly single-source drug and biologic products that do not have competing generics or biosimilars. This provision is limited in terms of the number of pharmaceuticals whose prices can be negotiated in any given year and it only applies to drug products that have been approved for at least 9 years and biologics that have been licensed for 13 years. Drugs and biologics that have been approved for a single rare disease or condition are categorically excluded from price negotiation. Further, the new legislation provides that if pharmaceutical companies raise prices in Medicare faster than the rate of inflation, they must pay rebates back to the government for the difference. The new law also caps Medicare out-of-pocket drug costs at an estimated $4,000 a year in 2024 and, thereafter beginning in 2025, at $2,000 a year.

At the state level, individual states are 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. In addition, regional health care 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 health care programs. These measures could reduce the ultimate demand for our products, if approved, or put pressure on our product pricing. We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures.

The Drug Supply Chain Security Act imposes new obligations on manufacturers of pharmaceutical products related to product tracking and tracing. Legislative and regulatory proposals have been made to expand post-approval requirements and restrict sales and promotional activities for pharmaceutical products. We are not sure whether additional legislative changes will be enacted, or whether the current regulations, guidance or interpretations will be changed, or what the impact of such changes on our business, if any, may be.

It is likely that federal and state legislatures within the United States and foreign governments will continue to consider changes to existing health care legislation. We cannot predict the reform initiatives that may be adopted in the future or whether initiatives that have been adopted will be repealed or modified. The continuing efforts of the government, insurance companies, managed care organizations and other health care payors of to contain or reduce costs of health care may adversely affect:

Finally, in the European Union, similar political, economic and regulatory developments may affect our ability to profitably commercialize our product candidates, if approved. In addition to continuing pressure on prices and cost containment measures, legislative developments at the European Union 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 European Union, law and policy. National governments and health service providers have different priorities and approaches to the delivery of healthcare 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 European Union and national regulatory burdens on those wishing to develop and market products, this could prevent or delay marketing approval of our product candidates, restrict or regulate post-approval activities and affect our ability to commercialize our product candidates, if approved.

In markets outside of the United States and the 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 product candidates may lose any regulatory approval that may have been obtained and we may not achieve or sustain profitability.

If we obtain FDA approval for SGT-003 or other future product candidates and begin commercializing those products in the United States, our operations will be directly or indirectly through our prescribers, customers and purchasers, subject to various federal and state fraud and abuse laws and regulations, including, without limitation, the federal Health Care Program Anti-Kickback Statute, the federal civil and criminal laws and the Physician Payment Sunshine Act and regulations. These laws will impact, among other things, our proposed sales, marketing and educational programs. In addition, we may be subject to patient privacy laws by both the federal government and the states in which we conduct our business. The laws that will affect our operations include, but are not limited to:

Because of the breadth of these laws and the narrowness of the statutory exceptions and safe harbors available, it is possible that some of our business activities could be subject to challenge under one or more of such laws. If our operations are found to be in violation of any of the laws described above or any other government regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from participation in government health care programs, such as Medicare and Medicaid, imprisonment and the curtailment or restructuring of our operations.

The risk of our being found in violation of these laws is increased by the fact that many of them have not been fully interpreted by the regulatory authorities or the courts, and their provisions are open to a variety of interpretations. Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. The shifting compliance environment and the need to build and maintain robust and expandable systems to comply with multiple jurisdictions with different compliance and/or reporting requirements increases the possibility that we may run afoul of one or more of the requirements.

The regulatory framework for the collection, use, safeguarding, sharing, transfer and other processing of information worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future. Globally, virtually every jurisdiction in which we operate has established its own data security and privacy frameworks with which we must comply. For example, the collection, use, disclosure, transfer, or other processing of personal data regarding individuals in the European Union, including personal health data, is subject to the General Data Protection Regulation, or GDPR, which took effect across all member states of the European Economic Area, or EEA, in May 2018. The GDPR is wide-ranging in scope and imposes numerous requirements on companies that process personal data, including requirements relating to processing health and other sensitive data, obtaining consent of the individuals to whom the personal data relates, providing information to individuals regarding data processing activities, implementing safeguards to protect the security and confidentiality of personal data, providing notification of data breaches, and taking certain measures when engaging third-party processors. The GDPR increases our obligations with respect to clinical trials conducted in the EEA by expanding the definition of personal data to include coded data and requiring changes to informed consent

practices and more detailed notices for clinical trial subjects and investigators. In addition, the GDPR also imposes strict rules on the transfer of personal data to countries outside the European Union, including the United States and, as a result, increases the scrutiny that clinical trial sites located in the EEA should apply to transfers of personal data from such sites to countries that are considered to lack an adequate level of data protection, such as the United States. The GDPR also permits data protection authorities to require destruction of improperly gathered or used personal information and/or impose substantial fines for violations of the GDPR, which can be up to four percent of global revenues or 20 million Euros, whichever is greater, and it also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR. In addition, the GDPR provides that European Union member states may make their own further laws and regulations limiting the processing of personal data, including genetic, biometric or health data.

Similar actions are either in place or under way in the United States. There are a broad variety of data protection laws that are applicable to our activities, and a wide range of enforcement agencies at both the state and federal levels that can review companies for privacy and data security concerns based on general consumer protection laws. The Federal Trade Commission and state Attorneys General all are aggressive in reviewing privacy and data security protections for consumers. New laws also are being considered at both the state and federal levels. For example, the California Consumer Privacy Act, which went into effect on January 1, 2020, is creating similar risks and obligations as those created by GDPR, though the Act does exempt certain information collected as part of a clinical trial subject to the Federal Policy for the Protection of Human Subjects (the Common Rule). Many other states are considering similar legislation. A broad range of legislative measures also have been introduced at the federal level. Accordingly, failure to comply with federal and state laws (both those currently in effect and future legislation) regarding privacy and security of personal information could expose us to fines and penalties under such laws. There also is the threat of consumer class actions related to these laws and the overall protection of personal data. Even if we are not determined to have violated these laws, government investigations into these issues typically require the expenditure of significant resources and generate negative publicity, which could harm our reputation and our business.

Given the breadth and depth of changes in data protection obligations, preparing for and complying with such requirements is rigorous and time intensive and requires significant resources and a review of our technologies, systems and practices, as well as those of any third-party collaborators, service providers, contractors or consultants that process or transfer personal data collected in the European Union. The GDPR and other changes in laws or regulations associated with the enhanced protection of certain types of sensitive data, such as healthcare data or other personal information from our clinical trials, could require us to change our business practices and put in place additional compliance mechanisms, may interrupt or delay our development, regulatory and commercialization activities and increase our cost of doing business, and could lead to government enforcement actions, private litigation and significant fines and penalties against us and could have a material adverse effect on our business, financial condition or results of operations. Similarly, failure to comply with federal and state laws regarding privacy and security of personal information could expose us to fines and penalties under such laws. Even if we are not determined to have violated these laws, government investigations into these issues typically require the expenditure of significant resources and generate negative publicity, which could harm our reputation and our business.

Further, we cannot provide any assurances that our third-party service providers with access to our or our customers’, suppliers’, trial patients’ and employees’ personally identifiable and other sensitive or confidential information in relation to which we are responsible will not breach contractual obligations imposed by us, or that they will not experience data security breaches or attempts thereof, which could have a corresponding effect on our business, including putting us in breach of our obligations under privacy laws and regulations and/or which could in turn adversely affect our business, results of operations and financial condition. We cannot provide any assurances that our contractual measures and our own privacy and security-related safeguards will protect us from the risks associated with the third-party processing, storage and transmission of such information.

Our operations are subject to anti-corruption laws, including the U.K. Bribery Act 2010, or Bribery Act, the U.S. Foreign Corrupt Practices Act, or FCPA, and other anti-corruption laws that apply in countries where we do business and may do business in the future. The Bribery Act, FCPA and these other laws generally prohibit us, our officers, and our employees and intermediaries from bribing, being bribed or making other prohibited payments to government officials or other persons to obtain or retain business or gain some other business advantage. Compliance with the FCPA, in particular, is expensive and difficult, particularly in countries in which corruption is a recognized problem. In addition, the FCPA presents particular challenges in the pharmaceutical industry, because, in many countries, hospitals are operated by the government, and doctors and other hospital employees are considered foreign officials. Certain payments to hospitals in connection with clinical trials and other work have been deemed to be improper payments to government officials and have led to FCPA enforcement actions.

We may in the future operate in jurisdictions that pose a high risk of potential Bribery Act or FCPA violations, and we may participate in collaborations and relationships with third parties whose actions could potentially subject us to liability under the Bribery Act, FCPA or local anti-corruption laws. In addition, we cannot predict the nature, scope or effect of future regulatory requirements to which our international operations might be subject or the manner in which existing laws might be administered or interpreted. If we expand our operations outside of the United States, we will need to dedicate additional resources to comply with numerous laws and regulations in each jurisdiction in which we plan to operate.

We are also subject to other laws and regulations governing our international operations, including regulations administered by the governments of the United Kingdom and the United States, and authorities in the European Union, including applicable export control regulations, economic sanctions on countries and persons, customs requirements and currency exchange regulations, collectively referred to as the Trade Control laws. In addition, various laws, regulations and executive orders also restrict the use and dissemination outside of the United States, or the sharing with certain non-U.S. nationals, of information classified for national security purposes, as well as certain products and technical data relating to those products. If we expand our presence outside of the United States, it will require us to dedicate additional resources to comply with these laws, and these laws may preclude us from developing, manufacturing, or selling certain products and product candidates outside of the United States, which could limit our growth potential and increase our development costs.

There is no assurance that we will be completely effective in ensuring our compliance with all applicable anti-corruption laws, including the Bribery Act, the FCPA or other legal requirements, including Trade Control laws. If we are not in compliance with the Bribery Act, the FCPA and other anti-corruption laws or Trade Control laws, we may be subject to criminal and civil penalties, disgorgement and other sanctions and remedial measures, and legal expenses, which could have an adverse impact on our business, financial condition, results of operations and liquidity. The Securities and Exchange Commission also may suspend or bar issuers from trading securities on U.S. exchanges for violations of the FCPA’s accounting provisions. Any investigation of any potential violations of the Bribery Act, the FCPA, other anti-corruption laws or Trade Control laws by United Kingdom, U.S. or other authorities could also have an adverse impact on our reputation, our business, results of operations and financial condition.

We face an inherent risk of product liability exposure related to the testing of SGT-003 and any future product candidate in preclinical studies and clinical trials and may face an even greater risk if we commercialize any product candidate that we may develop. If we cannot successfully defend ourselves against claims that our product candidates caused injuries, we could incur substantial liabilities. Regardless of merit or eventual outcome, liability claims may result in:

Although we maintain product liability insurance coverage, such insurance may not be adequate to cover all liabilities that we may incur. We anticipate that we will need to increase our insurance coverage each time we commence a clinical trial and if we successfully commercialize any product candidate. Insurance coverage is increasingly expensive. We may not be able to maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may arise.

We are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the generation, handling, use, storage, treatment, manufacture, transportation and disposal of, and exposure to, hazardous materials and wastes, as well as laws and regulations relating to occupational health and safety. Our operations involve the use of hazardous and flammable materials, including chemicals and viruses and other biologic materials. Our operations also produce hazardous waste products. We generally contract with third parties for the disposal of these materials and wastes. We cannot eliminate the risk of contamination or injury from these materials. In the event of contamination or injury resulting from our use of hazardous materials, we could be held liable for any resulting damages. We also could incur significant costs associated with civil or criminal fines and penalties. 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. Although we maintain workers’ compensation insurance for certain costs and expenses we may incur due to injuries to our employees resulting from the use of hazardous materials or other work-related injuries, this insurance may not provide adequate coverage against potential liabilities. 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 trials or regulatory approvals could be suspended.

In addition, we may incur substantial costs in order to comply with current or future environmental, health and safety laws and regulations, which have tended to become more stringent over time. These current or future laws and regulations may impair our research, development or production efforts. Failure to comply with these laws and regulations also may result in substantial fines, penalties or other sanctions or liabilities.

Despite the implementation of security measures, our internal computer systems and those of our current and any future collaborators and other contractors or consultants are vulnerable to damage from computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures. Such systems are also vulnerable to service interruptions or to security breaches from inadvertent or intentional actions by our employees, third-party vendors and/or business partners, or from cyber-attacks by malicious third parties. Cyber-attacks are increasing in their frequency, sophistication and intensity, and have become increasingly difficult to detect. Cyber-attacks could include the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability and threaten the confidentiality, integrity and availability of information. Cyber-attacks also could include phishing attempts or e-mail fraud to cause payments or information to be transmitted to an unintended recipient.

While we are not aware of any such material system failure, accident, cyber-attack or security breach to date, if such an event were to occur and cause interruptions in our or our collaborators’, contractors’ or consultants’ operations, it could result in a material disruption of our development programs and our business operations, whether due to a loss of our trade secrets or other proprietary information or other similar disruptions. For example, the loss of clinical trial data from preclinical studies or clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or

applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability, our competitive position could be harmed and the further development and commercialization of SGT-003 and other future product candidates could be delayed.

Our ability to develop and commercialize SGT-003 and other future product candidates is heavily dependent on licenses to patent rights and other intellectual property granted to us by third parties. In particular, we have licensed certain patents and patent applications from the University of Missouri, the University of Washington and others that are important or necessary to the development of SGT-003 and other elements of our gene transfer program. Our existing license agreements impose, and we expect that future license agreements will impose, various diligence, development and commercialization obligations, milestone payments, royalties and other obligations on us. If we fail to comply with our obligations under our agreements, we may be subject to damages, which may be significant, and the licensor may have the right to terminate the license, in which event we may not be able to develop or market product candidates or technologies covered by the license, including SGT-003. In addition, certain of these license agreements are not assignable by us without the consent of the respective licensor, which may have an adverse effect on our ability to engage in certain transactions.

Under our existing license agreements, we do not have, and under future license agreements we may not have, the right to control the preparation, filing and prosecution of patent applications, or the maintenance, enforcement and defense of the patents and patent applications that we license from third parties. For example, under our inbound license agreements with the University of Missouri and the University of Washington, each of the applicable licensors controls the prosecution of patent applications and the maintenance of patents and patent applications. Therefore, we cannot be certain that the licensed patents and applications will be prosecuted, maintained, enforced and defended in a manner consistent with the best interests of our business. If our licensors fail to maintain, enforce or defend such patents, or lose rights to those patents or patent applications, the rights we have licensed may be reduced or eliminated and our right to develop and commercialize any of our product candidates that are the subject of such licensed rights, including SGT-003, could be adversely affected. For more information, see Part I, Item 1, “Business—Strategic partnerships and collaborations/licenses” of our 2021 Annual Report on Form 10-K.

Moreover, licenses to additional third-party intellectual property, technology and materials may be required for our development programs but may not be available in the future or may not be available on commercially reasonable terms. For example, third parties may claim that the microdystrophin constructs and the AAV vectors we are developing for use in SGT-003 or other future product candidates are covered by patents held by them. We believe that we would have valid defenses to any such claims; however, if any such claims were ultimately successful, we might require a license to continue to use and sell SGT-003, or other future product candidates and such AAV vectors. Such licenses may not be available on commercially reasonable terms, or at all. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive. These established companies may have a competitive advantage over us due to their size, capital resources and greater clinical development and commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. We also may be unable to license or acquire third-party intellectual property rights on terms that would allow us to make an appropriate return on our investment. Moreover, even if we are able to obtain such licenses, they may only be non-exclusive, which could permit competitors and other third parties to use the same intellectual property in competition with us.

We may collaborate with non-profit and academic institutions to accelerate our preclinical research or development under written agreements with these institutions. These institutions may provide us with an option to negotiate a license to any of the institution’s rights in technology resulting from the collaboration. Regardless of such option, we may be unable to negotiate a license within the required timeframe or under terms that are acceptable to us. If we are unable to do so, the institution may offer the intellectual property rights to other parties, potentially blocking our ability to pursue our program.

If we are unable to successfully obtain rights to any third-party intellectual property rights that are required for the development and commercialization of SGT-003 or any of our other future product candidates, and such third-party intellectual property rights are successfully asserted against us, we may be liable for damages, which may be significant, and we may be required to cease the development and commercialization of SGT-003 or other future product candidates.

Our success depends, in large part, on our and our licensors’ ability to seek, obtain, maintain, enforce and defend patent rights in the United States and other countries with respect to SGT-003, other future product candidates and our future innovation related to our manufacturing technology. Our licensors and we have sought, and we intend to continue to seek, to protect our proprietary position by filing patent applications in the United States and, in at least some cases, one or more countries outside the United States related to SGT-003 and other future product candidates that are important to our business. However, we cannot predict whether the patent applications we and our licensors are currently pursuing will issue as patents or whether the claims of any issued patents will provide us with a competitive advantage.

Moreover, although we have pending patent applications in the United States and abroad, we cannot predict whether or in which jurisdictions the pending applications will result in issuance of patents that effectively protect any of our product candidates or will effectively prevent others from commercializing competitive products. Further, each of the provisional patent applications is not eligible to become an issued patent until, among other things, we file a non-provisional patent application within 12 months of the filing date of each provisional patent application. If we do not timely file a non-provisional patent application in respect of a provisional patent application, we may lose our priority date with respect to such provisional patent application and any patent protection on the inventions disclosed in such provisional patent application. While we intend to timely file non-provisional patent applications relating to our provisional patent applications, we cannot predict whether such future patent applications will result in the issuance of patents that effectively protect any of our product candidates or will effectively prevent others from commercializing competitive products.

The patent prosecution process is expensive, time-consuming and complex, and we and our licensors may not be able to file, prosecute, maintain, enforce, defend or license all necessary or desirable patents and patent applications at a reasonable cost or in a timely manner.

It is also currently unknown what claims may, if ever, issue from pending applications included in our patent rights. Additionally, certain of our in-licensed U.S. patent rights lack corresponding foreign patents or patent applications, and therefore we will be unable to obtain patent protection for our product candidates in certain jurisdictions. We or our licensors may not be able to obtain or maintain patent protection with respect to SGT-003 or other future product candidates.

Changes in either the patent laws or their interpretation in the United States and other countries may diminish our ability to protect our inventions, obtain, maintain and enforce our intellectual property rights, and more generally, could affect the value of our intellectual property rights or narrow the scope of our licensed patents or future owned patents.

It is also possible that we will fail to identify patentable aspects of our research and development output before it is too late to obtain patent protection. Although we enter into non-disclosure and confidentiality agreements with parties who have access to confidential or patentable aspects of our research and development output, such as our employees, corporate collaborators, outside scientific collaborators, CROs, contract manufacturers, consultants, advisors and other third parties, any of these parties may breach the agreements and disclose such output before a patent application is filed, thereby jeopardizing our ability to seek patent protection.

The patent position of biotechnology and pharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has, in recent years, been the subject of much litigation. As a result, the

issuance, scope, validity, enforceability and commercial value of our patent rights are highly uncertain. Patent applications included in our current and future patent rights may not result in patents being issued that protect our product candidates, effectively prevent others from commercializing competitive products or otherwise provide any competitive advantage. In fact, patent applications may not issue as patents at all. Even assuming patents issue from patent applications in which we have rights, changes in either the patent laws or interpretation of the patent laws in the United States and other jurisdictions may diminish the value of our patents or narrow the scope of our patent protection.

Other parties have developed products that may be related or competitive to our own and such parties may have filed or may file patent applications, or may have received or may receive patents, claiming inventions that may overlap or conflict with those claimed in our patent applications or issued patents. We may not be aware of all third-party intellectual property rights potentially relating to SGT-003 or our other current or future product candidates. In addition, we cannot provide any assurances that any of the inventions disclosed in our patent applications will be found to be patentable, including over third-party or our own prior art patents, publications or other disclosures, or will issue as patents. Even if our patent applications issue as patents, we cannot provide any assurances that such patents will not be challenged or ultimately held to be invalid or unenforceable. Publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and in other jurisdictions are typically not published until 18 months after filing, or, in some cases, at all. Therefore, we cannot know with certainty whether the inventors of our licensed patents and applications were the first to make the inventions claimed in those patents or pending patent applications, or that they were the first to file for patent protection of such inventions. Similarly, should we own any issued patents or patent applications in the future, we may not be certain that we were the first to file for patent protection for the inventions claimed in such patents or patent applications. Furthermore, given the differences in patent laws in the United States, Europe and other foreign jurisdictions, for example, the availability of grace periods for filing patent applications and what can be considered as prior art, we cannot make any assurances that any claims in our pending and future patent applications in the United States or other jurisdictions will issue, or if they do issue, whether they will issue in a form that provides us with any meaningful competitive advantage. Similarly, we cannot make any assurances that if the patentability, validity, enforceability or scope of our pending or future patents and patent applications in the United States or foreign jurisdictions are challenged by any third party, that the claims of such pending or future patents and patent applications will survive any such challenge in a form that provides us with any meaningful competitive advantage. For example, we are aware of certain third-party patents and publications related to certain microdystrophin constructs. While we believe that our owned or in-licensed patents and patent applications claim novel and non-obvious features of microdystrophin constructs that are not described in such third-party patents or publications, such third-party patents and publications may have earlier priority or publication dates and may be asserted as prior art against our owned or in-licensed patents and applications. Any such challenge, if successful, could limit or eliminate patent protection for our products and product candidates or otherwise materially harm our business. As a result, the issuance, scope, validity, enforceability and commercial value of our patent rights cannot be predicted with any certainty.

Moreover, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted after issuance. Even if patent applications we license or may own in the future do issue as patents, they may not issue in a form that will provide us with any meaningful protection, prevent competitors or other third parties from competing with us or otherwise provide us with any competitive advantage. Any patents that we license or may own in the future may be challenged, narrowed, circumvented, or invalidated by third parties. Consequently, we do not know whether any of our product candidates will be protectable or remain protected by valid and enforceable patents. Our competitors or other third parties may be able to circumvent our patents by developing similar or alternative products in a non-infringing manner.

The degree of patent protection we require to successfully compete in the marketplace may be unavailable. We cannot provide any assurances that any of the patents or patent applications included in our patent rights include or will include claims with a scope sufficient to protect SGT-003 and other future product candidates or otherwise provide any competitive advantage. In addition, the laws of foreign countries may not protect our proprietary rights to the same extent as the laws of the United States. Furthermore, patents have a limited lifespan. In the United States, the natural expiration of a patent is generally twenty years after it is filed. Certain extensions may be available, however, the life of a patent, and the protection it affords, is limited. Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or

shortly after such candidates are commercialized. As a result, our patent rights may not provide us with adequate and continuing patent protection sufficient to exclude others from commercializing products similar or identical to our product candidates, including biosimilar versions of such products.

Even if we acquire patent protection that we expect should enable us to maintain some competitive advantage, third parties, including competitors, may challenge the validity, enforceability or scope thereof, which may result in such patents being narrowed, invalidated or held unenforceable. In litigation, a competitor could claim that our in-licensed patents or any patents we may own in the future are not valid or enforceable for a number of reasons. If a court agrees, we would lose our rights to those challenged patents. Third parties also may raise similar claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such proceedings could result in the revocation or cancellation of or amendment to our licensed patents and any patents we may own in the future in such a way that they no longer cover SGT-003 or other future product candidates.

Even if issued, the issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our current and future patent rights may be challenged in the courts or patent offices in the United States and abroad. For example, we may be subject to a third-party submission of prior art to the U.S. Patent and Trademark Office, or USPTO, challenging the validity of one or more claims of patents included in our patent rights. Such submissions may also be made prior to a patent’s issuance, precluding the granting of a patent based on one of the pending patent applications included in our patent rights. We may become involved in opposition, derivation, revocation, reexamination, post-grant and inter partes review, or interference proceedings challenging one or more patents included in our patent rights. For example, competitors may claim that they invented the inventions claimed in patents or patent applications included in our patent rights, such as the microdystrophin we use in SGT-003, prior to the inventors of such patents or patent applications, or may have filed one or more patent applications before the filing of the patents or patent applications included in our patent rights. A competitor who can establish an earlier filing or invention date may also assert that we are infringing their patents and that we therefore cannot practice our technology related to our product candidates as claimed in the patents or patent applications included in our patent rights. Competitors may also contest patents or patent applications included in our patent rights by showing that the claimed subject matter was not patent-eligible, was not novel or was obvious or that the patent claims failed any other requirement for patentability or enforceability. In addition, we may in the future be subject to claims by our or our licensors’ current or former employees or consultants asserting an ownership right in the patents or patent applications included in our patent rights as an inventor or co-inventor, as a result of the work they performed.

An adverse determination in any such submission or proceeding may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing similar therapeutics, without payment to us, or could limit the duration of the patent protection covering our product candidates. Such challenges may also result in our inability to manufacture or commercialize our product candidates without infringing third-party patent rights, and we may be required to obtain a license from third parties, which may not be available on commercially reasonable terms or at all, or we may need to cease the development, manufacture and commercialization of one or more of our product candidates. In addition, if the breadth or strength of protection provided by the patents and patent applications included in our patent rights is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize current or future product candidates. Such proceedings also may result in substantial cost and require significant time from our scientists and management, even if the eventual outcome is favorable to us.

Even if they are unchallenged, the patents and pending patent applications included in our patent rights may not provide us with any meaningful protection or prevent competitors from designing around our patent claims to circumvent our patent rights by developing similar or alternative therapeutics in a non-infringing manner. For example, a third party may develop a competitive therapeutic that provides benefits similar to one or more of our product candidates but that uses a vector or an expression construct that falls outside the scope of our patent protection. If the patent protection provided by the patents and patent applications we license or pursue with respect to our product candidates is not sufficiently broad to impede such competition, our ability to successfully commercialize our product candidates could be negatively affected.

We currently depend, and will continue to depend, on our license, collaboration and other similar agreements. Further development and commercialization of SGT-003 and our other current and future product candidates may require us to enter into additional license, collaboration or other similar agreements. The agreements under which we currently license intellectual property or technology from third parties are complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement. Moreover, if disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on commercially acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates.

If any of our licenses or material relationships are terminated or breached, we may:

These risks apply to any agreements that we may enter into in the future for SGT-003 and our other current and future product candidates.

We have certain obligations under licensing agreements with third parties that include annual maintenance fees and payments that are contingent upon achieving various development, commercial and regulatory milestones. Pursuant to many of these license agreements, we are required to make milestone payments if certain development, regulatory and commercial sales milestones are achieved, and may have certain additional research funding obligations. Also, pursuant to the terms of many of these license agreements, when and if commercial sales of a licensed product commence, we must pay royalties to our licensors on net sales of the respective licensed products.

We have entered into license agreements with third parties and may need to obtain additional licenses from one or more of these same third parties or from others to advance our research or allow our commercialization of SGT-003 or other future product candidates. It is possible that we may be unable to obtain additional licenses at a reasonable cost or on reasonable terms, if at all. In that event, we may be required to expend significant time and resources to redesign SGT-003, other future product candidates or the methods for manufacturing them or to develop or license replacement products, all of which may not be feasible on a technical or commercial basis. If we are unable to do so, we may be unable to develop or commercialize SGT-003 or other future product candidates. We cannot provide any assurances that third-party patents or other intellectual property rights do not exist that might be enforced against our manufacturing methods, product candidates or any technologies we may develop, resulting in either an injunction prohibiting our manufacture or sales, or, with respect to our sales, an obligation on our part to pay royalties and/or other forms of compensation to third parties.

In each of our existing license agreements, and we expect in our future agreements, patent prosecution of our licensed technology is controlled solely by the licensor, and we may be required to reimburse the licensor for their costs of patent prosecution. If our licensors fail to obtain and maintain patent or other protection for the proprietary intellectual property we license from them, we could lose our rights to the intellectual property or our exclusivity with respect to those rights, and our competitors could market competing products using the intellectual property. Further, in certain of our license agreements our licensors have the first right to bring any actions against any third party for infringing on the patents we have licensed. Our license agreements also

require us to meet development thresholds to maintain the license, including establishing a set timeline for developing and commercializing product candidates. Disputes may arise regarding intellectual property subject to our licensing agreements, including:

If disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize SGT-003 or other future product candidates. In spite of our best efforts, our licensors might conclude that we have materially breached our license agreements and might therefore terminate the license agreements, thereby resulting in disputes or litigation, which could cause us to incur substantial costs and distract management’s time, and if we are unsuccessful, we could lose our ability to develop and commercialize products covered by these license agreements. If these licenses are ultimately terminated by the licensor, or if the underlying patents fail to provide the intended exclusivity, competitors would have the freedom to seek regulatory approval of, and to market, products identical to ours.

Our commercial success depends upon our ability and the ability of our future collaborators to develop, manufacture, market and sell SGT-003 or other future product candidates without infringing, misappropriating or otherwise violating the proprietary rights and intellectual property of third parties. The biotechnology and pharmaceutical industries are characterized by extensive and complex litigation regarding patents and other intellectual property rights. We or our licensors may in the future become party to, or be threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to SGT-003 or other future product candidates, including interference proceedings, post grant review and inter partes review before the USPTO. Our competitors or other third parties may assert infringement claims against us, alleging that, among other things, our therapeutics, manufacturing methods, formulations or administration methods are covered by their patents.

Given the vast number of patents in our field of technology, we cannot be certain or guarantee that a court would hold that SGT-003 or any of our other future product candidates do not infringe an existing patent or a patent that may be granted in the future. Many companies and institutions have filed, and continue to file, patent applications related to gene therapy and related manufacturing methods. Some of these patent applications have already been allowed or issued and others may issue in the future. Since this area is competitive and of strong interest to pharmaceutical and biotechnology companies, there will likely be additional patent applications filed and additional patents granted in the future, as well as additional research and development programs expected in the future. Furthermore, because patent applications can take many years to issue, may be confidential for 18 months or more after filing and can be revised before issuance, there may be applications now pending that may later result in issued patents that may be infringed by the manufacture, use, sale or importation of our product candidates and we may or may not be aware of such patents. If a patent holder believes the manufacture, use, sale or importation of one of our product candidates infringes its patent, the patent holder may sue us even if we have licensed other patent protection for our product candidates. Moreover, we may face patent infringement claims from non-practicing entities that have no relevant product revenue and against whom our licensed patent portfolio may therefore have no deterrent effect.

It is also possible that we have failed to identify relevant third-party patents or applications for which we may need a license to develop and commercialize SGT-003 and other future product candidates. For example, applications filed before November 29, 2000, and certain applications filed after that date that will not be filed outside the United States remain confidential until patents issue. Moreover, it is difficult for industry participants, including us, to identify all third-party patent rights that may be relevant to our product candidates because patent searching is imperfect due to differences in terminology among patents, incomplete databases and the difficulty in assessing the meaning of patent claims. We may fail to identify relevant patents or patent applications or may identify pending patent applications of potential interest but incorrectly predict the likelihood that such patent applications may issue with claims of relevance to our product candidates. In addition, we may be unaware of one or more issued patents that would be infringed by the manufacture, sale or use of a current or future product candidate, or we may incorrectly conclude that a third-party patent is invalid, unenforceable or not infringed by our activities. Additionally, pending patent applications that have been published can, subject to certain limitations, be later amended in a manner that could cover our product candidates.

Third parties may assert infringement claims against us based on existing patents or patents that may be granted in the future, regardless of their merit. There is a risk that third parties may choose to engage in litigation with us to enforce or to otherwise assert their patent or other intellectual property rights against us. For example, third parties may claim that the microdystrophin or the AAV vectors we are developing for use in SGT-003 or other future product candidates are covered by patents held by them. Even if we believe such claim, or other intellectual property claims alleged by third parties, are without merit, there is no assurance that we would be successful in defending such claims. A court of competent jurisdiction could hold that these third-party patents are valid, enforceable and infringed, which could materially and adversely affect our ability to commercialize SGT-003 or other future product candidates covered by the asserted third-party patents. In order to successfully challenge the validity of any such U.S. patent in federal court, we would need to overcome a presumption of validity. As this burden is a high one requiring us to present clear and convincing evidence as to the invalidity of any such U.S. patent claim, there is no assurance that a court of competent jurisdiction would invalidate the claims of any such U.S. patent. Similarly, there is no assurance that a court of competent jurisdiction would find that SGT-003 or other future product candidates did not infringe a third-party patent.

Patent and other types of intellectual property litigation can involve complex factual and legal questions, and their outcome is uncertain. If we are found, or believe there is a risk that we may be found, to infringe, misappropriate or otherwise violate a third party’s intellectual property rights, and we are unsuccessful in demonstrating that such intellectual property rights are invalid or unenforceable, we could be required or may choose to obtain a license from such third party to continue developing, manufacturing and marketing our product candidates. However, we may not be able to obtain any required license on commercially reasonable terms or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors and other third parties access to the same technologies licensed to us, and it could require us to make substantial licensing and royalty payments. We could be forced, including by court order, to cease developing, manufacturing and commercializing the infringing product candidate, including SGT-003 or other future product candidates. In addition, we could be found liable for monetary damages, including treble damages and attorneys’ fees, if we are found to have willfully infringed a patent or other intellectual property right. A finding of infringement, misappropriation or other violation of intellectual property rights, or claims that we have done so, could prevent us from manufacturing and commercializing our product candidates or force us to cease some or all of our business operations.

Litigation or other legal proceedings relating to intellectual property claims, with or without merit, is unpredictable and generally expensive and time-consuming. Competitors may infringe patents that we may own in the future or the patents of our licensing partners or we may be required to defend against claims of infringement. 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. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. 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 substantial adverse effect on the price of our common stock.

Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities.

We may not have sufficient financial or other resources to adequately conduct such litigation or proceedings. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources and more mature and developed intellectual property portfolios. Accordingly, despite our efforts, we may not be able to prevent third parties from infringing or misappropriating or successfully challenging our intellectual property rights. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could have a material adverse effect on our ability to compete in the marketplace.

Periodic maintenance fees, renewal fees, annuity fees and various other government fees on patents and/or applications will be due to be paid to the USPTO and various government patent agencies outside of the United States over the lifetime of our licensed patents and applications and any patents and patent applications we may own in the future. The USPTO and various non-U.S. government patent agencies require compliance with several procedural, documentary, fee payment and other similar provisions during the patent application process. We employ reputable intellectual property law firms and other professionals to help us comply and we are also dependent on our licensors to take the necessary action to comply with these requirements with respect to our licensed intellectual property. In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. There are situations, however, in which non-compliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, potential competitors might be able to enter the market and this circumstance could have a material adverse effect on our business.

Some of the intellectual property rights we have licensed, including such rights licensed from the University of Missouri and the University of Washington, are stated to have been generated through the use of U.S. government funding and may therefore be subject to certain federal regulations. As a result, the U.S. government may have certain rights to intellectual property embodied in our current or future product candidates pursuant to the Bayh-Dole Act of 1980, or Bayh-Dole Act. These U.S. government rights in certain inventions developed under a government-funded program include a non-exclusive, non-transferable, irrevocable worldwide license to use inventions for any governmental purpose. In addition, the U.S. government has the right to require us to grant exclusive, partially exclusive or non-exclusive licenses to any of these inventions to a third party if it determines that: (i) adequate steps have not been taken to commercialize the invention, (ii) government action is necessary to meet public health or safety needs or (iii) government action is necessary to meet requirements for public use under federal regulations (also referred to as “march-in rights”). The U.S. government also has the right to take title to these inventions if we, or the applicable licensor, fail to disclose the invention to the government and fail to file an application to register the intellectual property within specified time limits. Intellectual property generated under a government funded program is also subject to certain reporting requirements, compliance with which may require us or the applicable licensor to expend substantial resources. In addition, the U.S. government requires that any products embodying the subject invention or produced through the use of the subject invention be manufactured substantially in the United States. The manufacturing preference requirement can be waived if the owner of the intellectual property can show that reasonable but unsuccessful efforts have been made to grant licenses on similar terms to potential licensees that would be likely to manufacture substantially in the United States or that under the circumstances domestic manufacture is not commercially feasible. This preference for U.S. manufacturers may limit our ability to contract with non-U.S. product manufacturers for products covered by such intellectual property. To the extent any of our current or future intellectual property is generated through the use of U.S. government funding, the provisions of the Bayh-Dole Act may similarly apply.

Filing, prosecuting, maintaining, enforcing and defending patents on product candidates in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the United States could be less extensive than those in the United States. Although our license agreements grant us worldwide rights, certain of our in-licensed U.S. patents lack corresponding foreign patents or patent applications. For example, 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 even in jurisdictions where we and our licensors pursue patent protection. Consequently, we and our licensors may not be able to prevent third parties from practicing our inventions in all countries outside the United States, even in jurisdictions where we and our licensors pursue patent protection, or from selling or importing products made using our inventions in and into the United States or other jurisdictions. Competitors may use our inventions in jurisdictions where we and our licensors have not pursued and obtained patent protection to develop their own products and may export otherwise infringing products to territories where we have patent protection, but where enforcement is not as strong as it is in the United States. These products may compete with our product candidates 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, trade secrets and other intellectual property rights, particularly those relating to biotechnology products, which could make it difficult for us to stop the infringement of our patents, if pursued and obtained, or the marketing of competing products in violation of our intellectual property and proprietary rights generally. Proceedings to enforce our intellectual property and proprietary rights in foreign jurisdictions could (i) result in substantial costs and divert our efforts and attention from other aspects of our business, (ii) put our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing and (iii) 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.

In addition to the protection afforded by patents, we rely on trade secret protection and confidentiality agreements to protect 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 the discovery and development processes of SGT-003 and other future product candidates that involve proprietary know-how, information or technology that is not covered by patents. Aspects of our manufacturing process are protected by trade secrets. However, trade secrets can be difficult to protect and some courts inside and outside the United States are less willing or unwilling to protect trade secrets.

We seek to protect our proprietary know-how, trade secrets and processes, in part, by entering into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements or other similar agreements with our employees, consultants, scientific advisors, CROs, manufacturers and contractors. These agreements typically limit the rights of third parties to use or disclose our confidential information. However, we may not be able to prevent the unauthorized disclosure or use of our technical know-how or other trade secrets by the parties to these agreements, despite the existence generally of confidentiality agreements and other contractual restrictions. We cannot guarantee that we have entered into such agreements with each party that may have or have had access to our trade secrets or proprietary processes. Monitoring unauthorized uses and disclosures is difficult and we do not know whether the steps we have taken to protect our proprietary know-how and trade secrets will be effective. If any of our employees, collaborators, CROs, manufacturers, consultants, advisors and other third parties who are parties to these agreements breaches or violates the terms of any of these agreements, we may not have adequate remedies for any such breach or violation. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive, and time-consuming, and the outcome is unpredictable. As a result, we could lose our trade secrets. We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems. While we have confidence in these security measures, they may still be breached, and we may not have adequate remedies for any breach.

In addition, our trade secrets may otherwise become known or be independently discovered by competitors. Competitors could purchase our product candidates, if approved, and attempt to replicate some or all of the competitive advantages we derive from our development efforts, willfully infringe, misappropriate or otherwise violate our intellectual property rights, design around our protected know-how and trade secrets, or develop their own competitive technologies that fall outside of our intellectual property rights. If any of our trade secrets were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent them, or those to whom they communicate such trade secrets, from using that technology or information to compete with us. If our trade secrets are not adequately protected so as to protect our market against competitors’ products and technologies, our competitive position could be adversely affected.

Certain of our employees, consultants or advisors are currently, or were previously, employed at universities or other biotechnology or pharmaceutical companies, including our competitors or potential competitors, as well as our academic partners. Although we try to ensure that our employees, consultants and advisors do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that these individuals or we have used or disclosed intellectual property, including trade secrets or other proprietary information, of any such individual’s current or former employer. Litigation may be necessary to defend against these claims. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel. An inability to incorporate such technologies or features would have a material adverse effect on our business and may prevent us from successfully commercializing our product candidates. Moreover, any such litigation or the threat of such litigation may adversely affect our ability to hire employees or contract with independent contractors. A loss of key personnel or their work product could hamper or prevent our ability to commercialize our product candidates. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management.

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. Moreover, even when we obtain agreements assigning intellectual property to us, the assignment of intellectual property rights may not be self-executing or the assignment agreements may be breached, and we may be forced to bring claims against third parties, or defend claims that they may bring against us, to determine the ownership of what we regard as our intellectual property. Moreover, individuals executing agreements with us may have preexisting or competing obligations to a third party, such as an academic institution, and thus an agreement with us may be ineffective in perfecting ownership of inventions developed by that individual.

Changes in either the patent laws or the interpretation of the patent laws in the United States could increase the uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of issued patents. On September 16, 2011, the Leahy-Smith America Invents Act, or the Leahy-Smith Act, was signed into law. The Leahy-Smith Act includes several significant changes to U.S. patent law. Prior to March 2013 in the United States, assuming that other requirements for patentability are met, the first to make the claimed invention was entitled to the patent, while outside the United States, the first to file a patent application was entitled to the patent. After March 2013, under the Leahy-Smith Act, the United States transitioned to a first inventor to file system in which, assuming that other requirements for patentability are met, the first inventor to file a patent application will be entitled to the patent on an invention regardless of whether a third party was the first to invent the invention. The Leahy-Smith Act also includes a number of significant changes that affect the way patent applications will be prosecuted and may also affect patent litigation. These include allowing third-party submission of prior art to the USPTO during patent prosecution and additional procedures to attack the validity of a patent through various post-grant proceedings administered by the USPTO. The USPTO 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. Accordingly, it is not clear what, if any, impact the Leahy-Smith Act will have on the operation of our business as, among other reasons, the USPTO must still implement various regulations. However, 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.

The patent positions of companies engaged in the development and commercialization of biologics and pharmaceuticals are particularly uncertain. Two cases involving diagnostic method claims and “gene patents” have been decided by the U.S. Supreme Court. On March 20, 2012, the U.S. Supreme Court issued a decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc., or Prometheus, a case involving patent claims directed to a process of measuring a metabolic product in a patient to optimize a drug dosage for the patient. According to the U.S. Supreme Court, the addition of well understood, routine or conventional activity such as “administering” or “determining” steps was not enough to transform an otherwise patent-ineligible natural phenomenon into patent-eligible subject matter. On July 3, 2012, the USPTO issued a guidance memo to patent examiners indicating that process claims directed to a law of nature, a natural phenomenon or a naturally occurring relation or correlation that do not include additional elements or steps that integrate the natural principle into the claimed invention such that the natural principle is practically applied and the patent claim amounts to significantly more than the natural principle itself should be rejected as directed to patent-ineligible subject matter. On June 13, 2013, the U.S. Supreme Court issued its decision in Association for Molecular Pathology v. Myriad Genetics, Inc., or Myriad, a case involving patent claims held by Myriad Genetics, Inc. relating to the breast cancer susceptibility genes BRCA1 and BRCA2. Myriad held that an isolated segment of naturally occurring DNA, such as the DNA constituting the BRCA1 and BRCA2 genes, is not patent-eligible subject matter, but that complementary DNA may be patent-eligible.

In 2014, the USPTO issued a guidance to its patent examiners for evaluating claims for patent subject matter eligibility under the relevant statute (35 U.S.C. § 101). This guidance was in response to a series of decisions from the U.S. Supreme Court on patent claims reciting judicial exceptions, including Abstract Ideas, Laws of Nature/Natural Principles, Natural Phenomena and/or Natural Products. Based on judicial decisions and public feedback, several supplements to this guidance and additional memoranda and materials have since been issued and are continually being issued, while the current eligibility guidance has been incorporated into the latest (10th) edition of the MPEP (Manual for Patent Examination Procedure), last revised in June 2020. The current subject matter eligibility guideline instructs USPTO examiners to follow a two-part test, set forth in the U.S. Supreme Court decisions Alice/Mayo, as the only test that should be used to evaluate the eligibility of claims under examination, including claims directed to natural products and principles including all naturally occurring nucleic acids. Certain claims of our licensed patents and patent applications contain, and any future patents we may obtain may contain, claims that relate to specific recombinant DNA sequences that are naturally occurring at least in part and, therefore, could be the subject of future challenges made by third parties. In addition, the current USPTO subject matter eligibility guidance and the constantly evolving case law, together with contemplated congressional action, could all impact our ability to pursue similar patent claims in patent applications we may prosecute in the future.

We cannot assure our stockholders that our efforts to seek patent protection for our product candidates will not be negatively impacted by the decisions described above, rulings in other cases or changes in guidance or procedures issued by the USPTO. We cannot fully predict what impact the U.S. Supreme Court’s decisions in Prometheus and Myriad may have on the ability of life science companies to obtain or enforce patents relating to their products in the future. These decisions, the guidance issued by the USPTO and rulings in other cases or changes in USPTO guidance or procedures could have a material adverse effect on our existing patent rights and our ability to protect and enforce our intellectual property in the future.

Moreover, although the U.S. Supreme Court has held in Myriad that isolated segments of naturally occurring DNA are not patent-eligible subject matter, certain third parties could allege that activities that we may undertake infringe other gene-related patent claims, and we may deem it necessary to defend ourselves against these claims by asserting non-infringement and/or invalidity positions, or paying to obtain a license to these claims. In any of the foregoing or in other situations involving third-party intellectual property rights, if we are unsuccessful in defending against claims of patent infringement, we could be forced to pay damages or be subjected to an injunction that would prevent us from utilizing the patented subject matter.

Depending upon the timing, duration and specifics of any FDA marketing approval of SGT-003 and other future product candidates, one or more U.S. patents that we license or may own in the future may be eligible for limited patent term extension under the Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Amendments. The Hatch-Waxman Amendments permit a patent extension term of up to five years as compensation for patent term lost during the FDA regulatory review process based on the first regulatory approval for a particular drug or biologic. A patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval, only one patent may be extended and only those claims covering the approved drug, a method for using it or a method for manufacturing it may be extended. However, we may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements. Moreover, the applicable time period or the scope of patent protection afforded could be less than we request. In addition, to the extent we wish to pursue patent term extension based on a patent that we in-license from a third party, we would need the cooperation of that third party. If we are unable to obtain patent term extension or the term of any such extension is less than we request, our competitors may be able to enter the market sooner.

We have registered trademarks with the USPTO for the marks “SOLID BIOSCIENCES”, “SOLID GT” and “SOLID”. Once registered, our trademarks or trade names may be challenged, infringed, diluted, tarnished, circumvented or declared generic or determined to be infringing on other marks. We may not be able to protect our rights to these trademarks and trade names, which we need to build name recognition among potential partners or customers in our markets of interest. At times, competitors may adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion. In addition, there could be potential trade name or trademark infringement, dilution or tarnishment claims brought by owners of other registered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade names. Over the long term, if we are unable to establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively and our business may be adversely affected. Our efforts to enforce or protect our proprietary rights related to trademarks, trade secrets, domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion of resources.

The degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations, and may not adequately protect our business or permit us to maintain our competitive advantage. For example:

The Biologics Price Competition and Innovation Act of 2009, or BPCIA, was enacted as part of the Health Care Reform Law to establish an abbreviated pathway for the approval of biosimilar and interchangeable biological products. The 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 approved biologic. Under the BPCIA, a reference biological product is granted 12 years of data exclusivity from the time of first licensure of the product, and the FDA will not accept an application for a biosimilar or interchangeable product based on the reference biological product until four years after the date of first licensure of the reference product In addition, the licensure 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 develop and receive approval of a competing biologic, so long as its BLA does not reply on the reference product, sponsor’s data or submit the application as a biosimilar application. 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, and any new policies or processes adopted by the FDA could have a material adverse effect on the future commercial prospects for our biological products.

We believe that any of the product candidates we develop as a biological product under a BLA should qualify for the 12-year period of exclusivity. However, there is a risk that this exclusivity could be shortened due to congressional action or otherwise, or that the FDA will not consider the subject product candidates to be reference products for competing products, potentially creating the opportunity for biosimilar competition sooner than anticipated. Moreover, the extent to which a biosimilar, once approved, will be substituted for any one of the reference products in a way that is similar to traditional generic substitution for non-biological products will depend on a number of marketplace and regulatory factors that are still developing. Nonetheless, the approval of a biosimilar to our product candidates would have a material adverse impact on our business due to increased competition and pricing pressure.

Our common stock is currently listed on The Nasdaq Global Select Market. To maintain the listing of our common stock on The Nasdaq Global Select Market, we are required to meet certain listing requirements, including related to the price of our common stock. As previously disclosed, on May 31, 2022, we received a deficiency letter from the Listing Qualifications Department of The Nasdaq Stock Market, or Nasdaq, notifying us that, for a period of 30 consecutive business days, the bid price for our common stock had closed below the $1.00 per share minimum bid price requirement for continued inclusion on The Nasdaq Global Select Market.

Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), we have been provided an initial compliance period of 180 calendar days from receipt of the Notice, or until November 28, 2022, to regain compliance with the

minimum bid price requirement. To regain compliance, the bid price for our common stock would need to close at $1.00 per share or more for a minimum of 10 consecutive business days, among other requirements. If we are unable to meet Nasdaq’s listing maintenance standards for any reason, our common stock could be delisted from The Nasdaq Global Select Market.

To help cure the deficiency, we effected a reverse stock split on October 27, 2022.

If we do not regain compliance with the minimum bid price requirement by the November 28, 2022, we may be eligible for an additional 180 calendar day compliance period. To qualify, we would need to transfer the listing of our common stock to the Nasdaq Capital Market, provided that we meet the continued listing requirement for the market value of publicly held shares and all other initial listing standards, with the exception of the bid price requirement. To effect such a transfer, we would also need to pay an application fee to Nasdaq and will need to provide written notice to Nasdaq of our intention to cure the deficiency during the additional compliance period by effecting a reverse stock split, if necessary. As part of its review process, the Nasdaq staff will make a determination of whether it believes we will be able to cure this deficiency

We intend to monitor the closing bid price of our common stock and may, if appropriate, consider available options to regain compliance with the bid price requirement. However, there can be no assurance that we will be able to regain compliance with the bid price requirement.

There are many factors that may adversely affect our minimum bid price. As a result, we may not be able to sustain compliance with the minimum bid price in the long term. Any potential delisting of our common stock from Nasdaq would likely result in decreased liquidity and increased volatility for our common stock and would adversely affect our ability to raise additional capital or to enter into strategic transactions. Any potential delisting of our common stock from Nasdaq would also make it more difficult for our stockholders to sell our common stock in the public market.

Our executive officers and directors and principal stockholders, in the aggregate, beneficially own shares representing a significant percentage of our capital stock. As a result, if these stockholders were to choose to act together, they would be able to control or significantly influence all matters submitted to our stockholders for approval, as well as our management and affairs. For example, these persons, if they choose to act together, would control or significantly influence the election of directors and approval of any merger, consolidation or sale of all or substantially all of our assets.

This concentration of voting power may:

Sales of a substantial number of shares of our common stock in the public market could occur at any time. These sales, or the perception in the market that holders of a large number of shares intend to sell shares, could reduce the market price of our common stock. Our outstanding shares of common stock may be freely sold in the public market at any time to the extent permitted by Rules 144 and 701 under the Securities Act of 1933, as amended, or the Securities Act, or to the extent such shares have already been registered under the Securities Act and are held by non-affiliates of ours. Moreover, holders of a substantial number of shares of our common stock have rights, subject to certain conditions, to require us to file registration statements covering their shares or to include their shares in registration statements that we may file for ourselves or other stockholders.

In October 2020, in connection with the execution of our collaboration and license agreement with Ultragenyx, we issued and sold 521,719 shares of our common stock to Ultragenyx. For the ten-year period after date of such sale, subject to specified conditions, we have agreed to file a registration statement in order to register all or a portion of the shares sold to Ultragenyx.

In July 2019 and December 2020, we completed private placements of shares of our common stock and pre-funded warrants to purchase shares of our common stock to several accredited investors. We have filed registration statements covering the resale of these shares by the purchasers in these private placements and have agreed to keep such registration statements effective until the date the shares covered by the respective registration statement have been sold or can be resold without restriction under Rule 144 of the Securities Act.

On September 29, 2022, we entered into a registration rights agreement, pursuant to which we are required to register for resale the shares to be purchased in the Private Placement. Under this agreement, subject to certain conditions, we have agreed to file a registration statement covering the resale of the shares to be purchased by the purchasers in the Private Placement and any stock consideration issuable in connection with the Acquisition within 60 days following the closing of the Private Placement. In addition, we have agreed to use commercially reasonable efforts to cause such registration statement to become effective as soon as practicable after it is filed with the SEC and to keep such registration statement effective until the date the shares covered by the registration statement have been sold or can be resold without restriction under Rule 144 of the Securities Act.

In addition, we have filed registration statements registering all shares of common stock that we may issue under our equity compensation plans. These shares can be freely sold in the public market upon issuance, subject to black-out periods and volume limitations applicable to affiliates.

We currently have on file with the SEC a universal shelf registration statement which allows us to offer and sell registered common stock, preferred stock, debt securities, depositary shares, warrants and/or units from time to time pursuant to one or more offerings at prices and terms to be determined at the time of sale.

Our stock price has been, and in the future is likely to be, volatile. The stock market in general and the market for biopharmaceutical or pharmaceutical companies in particular, has experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, our stockholders may not be able to sell their shares of common stock at or above the price they paid for their shares. The market price for our common stock may be influenced by many factors, including:

If our quarterly operating results fall below the expectations of investors or securities analysts, the price of our common stock could decline substantially. Furthermore, any quarterly fluctuations in our operating results may, in turn, cause the price of our stock to fluctuate substantially.

In the past, following periods of volatility in the market price of a company’s securities, securities class-action litigation often has been instituted against that company. We and certain of our executive officers and board members have previously been named as defendants in purported class action lawsuits. Any such litigation instituted against us could cause us to incur substantial costs to defend such claims and divert management’s attention and resources.

Although our common stock is listed on the Nasdaq Global Select Market, given the limited trading history of our common stock, there is a risk that an active trading market for our shares may not continue to develop or be sustained. If an active market for our common stock does not continue to develop or is not sustained, it may be difficult for our stockholders to sell shares without depressing the market price for the shares, or at all.

We are an “emerging growth company,” or EGC, as defined in the Jumpstart our Business Startups Act of 2012, or the JOBS Act. We will remain an EGC until the earliest of: (i) the last day of the fiscal year in which we have total annual gross revenues of $1.07 billion or more; (ii) December 31, 2023; (iii) the date on which we have issued more than $1.0 billion in nonconvertible debt during the previous three years; and (iv) the date on which we are deemed to be a large accelerated filer under the rules of the Securities and Exchange Commission, or the SEC. For so long as we remain an EGC, we are permitted and intend to rely on exemptions from certain disclosure requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include:

We are also a smaller reporting company, and we will remain a smaller reporting company until the fiscal year following the determination that our voting and non-voting common stock held by non-affiliates is more than $250 million measured on the last business day of our second fiscal quarter, or our annual revenues are less than $100 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is more than $700 million measured on the last business day of our second fiscal quarter.

Similar to emerging growth companies, smaller reporting companies are able to provide simplified executive compensation disclosure and have certain other reduced disclosure obligations, including, among other things, being permitted to provide only two years of audited financial statements, with correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; not being required to furnish a contractual obligations table in “Management's Discussion and Analysis of Financial Condition and Results of Operations”; and not being required to furnish a stock performance graph in our annual report.

We may choose to take advantage of some, but not all, of the available exemptions. We have taken advantage of reduced reporting burdens in our filings with the Securities and Exchange Commission. In particular, we have not included all of the executive compensation information that would be required if we were not an EGC. We cannot predict whether investors will find our common stock less attractive if we rely on certain or all of 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.

As a public company, and particularly after we are no longer an EGC or a smaller reporting company, we incur significant legal, accounting and other expenses that we did not incur as a private company. In addition, the Sarbanes-Oxley Act and rules subsequently implemented by the SEC and Nasdaq have imposed various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices. Our management and other personnel devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect that these rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance.

Pursuant to Section 404, we are required to furnish a report by our management on our internal control over financial reporting. However, while we remain an EGC or a smaller reporting company with less than $100 million in revenue, we will not be required to include an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. To achieve compliance with Section 404 within the prescribed period, we will be engaged in a process to document and evaluate our internal control over financial reporting, which is both costly and challenging. In this regard, we will need to continue to dedicate internal resources, engage outside consultants and adopt a detailed work plan to assess and document the adequacy of internal control over financial reporting, continue steps to improve control processes, validate through testing that controls are functioning as documented and implement a continuous reporting and improvement process for internal control over financial reporting. Despite our efforts, there is a risk that neither we nor our independent registered public accounting firm will be able to conclude within the prescribed timeframe that our internal control over financial reporting is effective as required by Section 404. This could result in an adverse reaction in the financial markets due to a loss of confidence in the reliability of our financial statements.

Provisions in our certificate of incorporation and our bylaws may discourage, delay or prevent a merger, acquisition or other change in control of us that stockholders may consider favorable, including transactions in which our stockholders might otherwise receive a premium for their shares. These provisions also could limit the price that investors might be willing to pay in the future for shares of our common stock, thereby depressing the market price of our common stock. In addition, because our Board of Directors is responsible for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our Board of Directors. Among other things, these provisions:

Moreover, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, or the DGCL, which prohibits a person who owns in excess of 15% of our outstanding voting stock from merging or combining with us for a period of three years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner.

We have never declared or paid cash dividends on our capital stock. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. In addition, the terms of any future debt agreements may preclude us from paying dividends. As a result, capital appreciation, if any, of our common stock will be the sole source of gain for an investor for the foreseeable future.

Our certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware is the exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim for breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL, our certificate of incorporation or our bylaws or (iv) any action asserting a claim governed by the internal affairs doctrine. We do not intend to have this choice of forum provision apply to, and this choice of forum provision will not apply to, actions arising under the Securities Act or the Exchange Act. The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and other employees. Alternatively, if a court were to find the choice of forum provision contained in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions.

Since inception, AavantiBio has incurred significant net losses. AavantiBio’s net loss was $23.2 million for the six months ended June 30, 2022 and $36.6 million for the year ended December 31, 2021. AavantiBio’s net loss was approximately $7.0 million for the year ended December 31, 2020. As of June 30, 2022, AavantiBio had an accumulated deficit of $67.4 million. To date, AavantiBio has devoted substantially all of its efforts to research and development, including preclinical development of its main product candidate, AVB-202, a gene transfer candidate for the treatment of Friedreich’s ataxia, as well as to building out its management team and infrastructure. AavantiBio expects that it could be several years, if ever, before it has a commercialized product. AavantiBio expects to continue to incur significant expenses and increasing operating losses for the foreseeable future.

To become and remain profitable, AavantiBio must develop and eventually commercialize one or more product candidates with significant market potential. This will require AavantiBio to be successful in a range of challenging activities, and AavantiBio’s expenses will increase substantially as it prepares to submit investigational new drug applications, or INDs, initiates planned and future clinical trials of AVB-202, initiates preclinical studies of AVB-401 and its other product candidates, prepares for and potentially obtains marketing approval for AVB-202, AVB-401 or its other product candidates, develops and validates commercial-scale manufacturing processes, manufactures, markets and sells any future product candidates for which it may obtain marketing approval and satisfies any post-marketing requirements. Moreover, the manufacturing process requires materials which may fluctuate in cost or be limited or unavailable to AavantiBio, as well as relationships with contract development and manufacturing organizations to facilitate the manufacturing process. AavantiBio may never succeed in any or all of these activities and, even if it does, AavantiBio may never generate revenue that is significant or large enough to achieve profitability.

Identifying potential product candidates and conducting preclinical testing and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete, and AavantiBio may never generate the necessary data or results required to submit a biologics license application, or BLA, or obtain marketing approval and achieve product sales. In addition, AavantiBio’s product candidates, if approved, may not achieve commercial success. AavantiBio’s product revenue, if any, will be derived from or based on sales of product candidates that may not be commercially available for many years, if at all.

AavantiBio will need to successfully initiate and complete clinical trials in order to obtain FDA approval to market AVB-202, AVB-401 or its other product candidates. AavantiBio has never submitted an IND to initiate a clinical trial. AavantiBio has limited experience in preparing, submitting and prosecuting regulatory filings, and has not previously submitted a new drug application or a BLA for any product candidate. AavantiBio cannot be sure that submission of an IND will result in the FDA allowing clinical trials to begin or to begin as proposed, or that, once begun, issues will not arise that suspend or terminate such clinical trials. Carrying out later-stage clinical trials and the submission of a successful BLA is a complicated process. In addition, AavantiBio cannot be certain how many clinical trials of AVB-202, AVB-401 or its other product candidates will be required or how such trials should be designed. Consequently, AavantiBio may be unable to successfully and efficiently execute and complete necessary clinical trials in a way that leads to BLA submission and approval of AVB-202, AVB-401 or its other product candidates. AavantiBio may require more time and incur greater costs than its competitors and may not succeed in obtaining regulatory approvals of product candidates that it develops. Failure to commence or complete, or delays in, clinical trials, could prevent AavantiBio from or delay it in commercializing AVB-202, AVB-401 and its other product candidates.

Results from preclinical studies or early clinical trials are not necessarily predictive of future clinical trial results and are not necessarily indicative of final results, and many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in late-stage clinical trials. AavantiBio’s preclinical studies for AVB-202 in animals have been limited. AavantiBio’s product candidates are still at the preclinical and IND-enabling stage of development, and there is a high failure rate for gene therapy and biologic products proceeding through clinical trials. Even if AavantiBio’s product candidates achieve promising results in preclinical testing and earlier-stage clinical trials, AavantiBio may suffer significant setbacks in late-stage clinical trials.

Preclinical studies also present their own risks and data obtained from preclinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory approval. AavantiBio also may experience regulatory delays or rejections as a result of many factors, including due to changes in regulatory policy during the period of AavantiBio’s product candidate development. AVB-202, AVB-401 or AavantiBio’s other product candidates may fail to show the desired safety and efficacy in clinical development despite initial positive results in preclinical studies. This failure could cause AavantiBio to abandon AVB-202, AVB-401 or its other product candidates before even reaching the clinical trial stage of development or during the clinical trial stage of development.

In the event AavantiBio proceeds to clinical trials, side effects caused by AavantiBio’s product candidates could cause AavantiBio or regulatory authorities to interrupt, delay, or terminate clinical trials. They additionally may result in a delay of regulatory approval by the FDA or comparable foreign authorities, or, even in the instance that an affected product candidate is approved, may result in a restrictive drug label.

AavantiBio’s product candidates have not been studied in human patients. AavantiBio may experience a high rate or severity of adverse events and high rates of discontinuation of trial participants in its future clinical trials. There is no guarantee that additional or more severe side effects than AavantiBio anticipates will not be identified during future clinical trials of its product candidates for current and other indications. Undesirable side effects and negative results for other indications may negatively impact the development and potential for approval of AavantiBio’s product candidates for their proposed indications.

Additionally, even if one or more of AavantiBio’s product candidates receives marketing approval, and AavantiBio or others later identify undesirable side effects caused by such products, potentially significant negative consequences could result, including but not limited to:

Any of these events could prevent AavantiBio from achieving or maintaining market acceptance of a product candidate, even if approved, and could significantly harm its business, results of operations, and prospects.

During the conduct of clinical trials, patients may experience changes in their health, including illnesses, injuries, discomforts or a fatal outcome. Often, it is not possible to determine whether the product candidate being studied caused these conditions.

There have been several significant adverse side effects in gene therapy treatments of other companies in the past, including reported cases of leukemia and death seen in other companies’ clinical trials using other vectors. While new recombinant vectors have been developed with the intent to reduce these side effects, gene therapy is still a relatively new approach to disease treatment and additional adverse side effects could develop. There also is the potential risk of delayed adverse events following exposure to gene therapy products due to persistent biologic activity of the genetic material or other components of products used to carry the genetic material. Possible adverse side effects that may occur with treatment with gene therapy products include an immunologic reaction early after administration that could substantially limit the effectiveness of the treatment or represent safety risks for patients. Additionally, in previous clinical trials of other companies for gene therapy, some subjects experienced the development of a positive ELISPOT test associated with T-cell responses, which is of unclear clinical significance. If T-cells are activated, the cellular immune response system may trigger the removal of transduced cells. If AavantiBio’s gene transfer candidates demonstrate a similar effect or other undesirable side effects, it may decide or be required to halt or delay any clinical development of such product candidates.

Before obtaining marketing approval from regulatory authorities for the sale of AVB-202, AVB-401 or its other product candidates, AavantiBio must conduct extensive clinical trials to demonstrate the safety and efficacy of the product candidate for its intended indications. Clinical testing is expensive, time-consuming and uncertain as to outcome. AavantiBio cannot guarantee that any clinical trials will be conducted as planned or completed on

schedule, if at all. A failure of one or more clinical trials can occur at any stage of testing. Events that may prevent successful or timely completion of clinical development, include, but are not limited to, delays in reaching a consensus with regulatory authorities on trial design, delays in enrolling patients in clinical trials, delays in opening clinical trial sites, failure to adhere to clinical trial requirements, failure to perform in accordance with good clinical practices, occurrence of serious adverse events, changes in regulatory requirements. Additionally, if the results of any clinical trials are inconclusive or if there are safety concerns or serious adverse events associated with product candidates, AavantiBio may be delayed or fail in obtaining marketing approval, obtain approval for indications or patient populations that are not as broad as it intended or desired, obtain approval with labeling that includes significant use or distribution restrictions or safety warnings or be required to perform additional clinical trials to support approval or be subject to additional post-marketing testing requirements.

Identifying and qualifying patients to participate in any clinical trials of AVB-202, AVB-401 and its other product candidates is critical to AavantiBio’s success. The timing of any clinical trials depends on AavantiBio’s ability to recruit patients to participate as well as complete required follow-up periods. Patient enrollment is affected by many factors, including, but not limited to, size of the patient population, eligibility and exclusion criteria, perceived risks and benefits of gene therapy-based approaches to treatment of diseases, severity of the disease, availability of competing therapies and clinical trials and proximity and availability of clinical trial sites. If patients are unwilling or unable to participate in AavantiBio’s gene therapy clinical trials, including because of negative publicity from adverse events related to AavantiBio’s product candidates, other approved gene therapies or the biotechnology or gene therapy fields, or due to competitive clinical trials for similar patient populations, clinical trials in products employing AavantiBio’s vector or its platform or for other reasons, the timeline for recruiting patients, conducting clinical trials and obtaining regulatory approval of AVB-202 or AavantiBio’s other product candidates may be delayed. AavantiBio may also experience delays if patients withdraw from the clinical trial or do not complete the required monitoring period. Furthermore, AavantiBio may face difficulties in recruiting patients to enroll in, or retaining patients in, future clinical trials if they or their caregivers are affected by the COVID-19 virus or are fearful of traveling to, or are unable to travel to, AavantiBio’s clinical trial sites because of the COVID-19 pandemic or other unforeseen events. These delays could result in increased costs, delays in advancing AVB-202, AVB-401 or AavantiBio’s other product candidates, delays in testing the effectiveness of AVB-202, AVB-401 and AavantiBio’s other product candidates or termination of clinical trials altogether.

AavantiBio has concentrated its research and development efforts on AVB-202 for the treatment of Friedreich’s ataxia and AVB-401 for the treatment of BAG3 mediated dilated cardiomyopathy, and AavantiBio’s future success depends on its successful development of that AVB-202, AVB-401 and any other product candidates AavantiBio develops. AavantiBio’s risk of failure is high. AavantiBio has experienced, and may in the future experience, problems or delays in developing AVB-202, AVB-401 and its other product candidates. Any such problems or delays would cause unanticipated costs, and any development problems may not be solved. For example, AavantiBio or another party may uncover a previously unknown risk associated with AVB-202, AVB-401, the adeno-associated virus, or AAV, vector, construct, toxicity or other issues that may be more problematic than AavantiBio currently believes and this may prolong the period of observation required for obtaining, or result in the failure to obtain, regulatory approval or may necessitate additional clinical testing.

The regulatory approval process for novel product candidates such as AavantiBio’s is unclear and can be more expensive and take longer than for other, better known or more extensively studied product candidates. To AavantiBio’s knowledge, only a limited number of gene transfer products have been approved for commercialization. As a result, it is difficult to determine how long it will take or how much it will cost to obtain regulatory approvals for AVB-202 or AVB-401, if at all.

AavantiBio cannot commercialize AVB-202, AVB-401 or its other product candidates until the appropriate regulatory authorities have reviewed and approved the product candidate. The process of obtaining regulatory

approvals and the subsequent compliance with appropriate federal, state and local statutes and regulations require the expenditure of substantial time and financial resources and AavantiBio may not be able to obtain the required regulatory approvals. Even if AavantiBio’s product candidates meet their safety and efficacy endpoints in clinical trials, the regulatory authorities may not complete their review processes in a timely manner, or AavantiBio may not be able to obtain regulatory approval. Additional delays may result if an FDA advisory committee or other regulatory authority recommends non-approval or restrictions on approval. In addition, AavantiBio may experience delays or rejections based upon additional government regulation from future legislation or administrative action or changes in regulatory authority policy during the period of product development, clinical trials and the regulatory review process.

Even if AavantiBio receives regulatory approval, regulatory authorities may approve a product candidate for more limited indications than requested or they may impose significant limitations in the form of narrow indications, warnings or a REMS. Regulatory authorities may require precautions or contra-indications with respect to conditions of use or they may grant approval subject to the performance of costly post-marketing clinical trials. In addition, regulatory authorities may not approve the labeling claims that are necessary or desirable for the successful commercialization of AavantiBio’s product candidates. Any of the foregoing scenarios could materially harm the commercial prospects for AavantiBio’s product candidates.

AavantiBio operates in a highly competitive segment of the biopharmaceutical market. AavantiBio faces competition from many different sources, including larger and better-funded pharmaceutical, specialty pharmaceutical and biotechnology companies, as well as from academic institutions, government agencies and private and public research institutions. AavantiBio’s product candidates, if successfully developed and approved, will compete with established therapies as well as with new treatments that may be introduced by its competitors. There are a variety of product candidates, including gene therapies, in development for Friedreich’s ataxia or dilated cardiomyopathy. Many of AavantiBio’s competitors have significantly greater financial, product candidate development, manufacturing and marketing resources than AavantiBio does. Large pharmaceutical and biotechnology companies have extensive experience in clinical testing and obtaining regulatory approval for their products, and mergers and acquisitions within these industries may result in even more resources being concentrated among a smaller number of larger competitors. Smaller and other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties compete with AavantiBio in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, AavantiBio’s programs.

AavantiBio’s commercial opportunity could be reduced or eliminated if competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, have broader market acceptance, are more convenient or are less expensive than any product candidate that AavantiBio may develop, or in the event a competitor obtains regulatory exclusivity.

AavantiBio is aware of several companies focused on developing gene therapies in various indications, as well as several companies addressing other methods for modifying genes and regulating gene expression. Any advances in gene therapy technology made by a competitor may be used to develop therapies that could compete against AVB-202, AVB-401 or any future gene therapy product candidates AavantiBio develops.

The Biologics Price Competition and Innovation Act of 2009, or BPCIA, was enacted as part of the Health Care Reform Law to establish an abbreviated pathway for the approval of biosimilar and interchangeable biological products. The 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 approved biologic. Under the BPCIA, a reference biological product is granted 12 years of data exclusivity from the time of first licensure of the product, and the FDA will not accept an application for a biosimilar or interchangeable product based on the reference biological product until four years after the date of first licensure of the reference product. In addition, the licensure 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 develop and receive approval of a competing biologic, so long as its BLA does not reply on the reference product, sponsor’s data or submit the application as a

biosimilar application. 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, and any new policies or processes adopted by the FDA could have a material adverse effect on the future commercial prospects for AavantiBio’s biological products.

AavantiBio believes that any of the product candidates it develops as a biological product under a BLA should qualify for the 12-year period of exclusivity. However, there is a risk that this exclusivity could be shortened due to congressional action or otherwise, or that the FDA will not consider the subject product candidates to be reference products for competing products, potentially creating the opportunity for biosimilar competition sooner than anticipated. Moreover, the extent to which a biosimilar, once approved, will be substituted for any one of the reference products in a way that is similar to traditional generic substitution for non-biological products will depend on a number of marketplace and regulatory factors that are still developing. Nonetheless, the approval of a biosimilar to AavantiBio’s product candidates would have a material adverse impact on AavantiBio’s business due to increased competition and pricing pressure.

While AavantiBio has retained all rights to and is developing on its own AVB-202 and AVB-401, AavantiBio may in the future enter into development, distribution or marketing arrangements with third parties with respect to AVB-202, AVB-401 or future product candidates. AavantiBio’s likely collaborators for any such sales, marketing, distribution, development, licensing or broader collaboration arrangements include large and mid-size pharmaceutical companies, regional and national pharmaceutical companies and biotechnology companies. If AavantiBio enters into any such arrangements with any third parties in the future, AavantiBio will likely have limited control over the amount and timing of resources that AavantiBio’s collaborators dedicate to the development or commercialization of its product candidates. AavantiBio’s ability to generate revenues from these arrangements will depend on AavantiBio’s collaborators’ abilities and efforts to successfully perform the functions assigned to them in these arrangements. Collaborations that AavantiBio enters into may not be successful, and any success will depend heavily on the efforts and activities of such collaborators.

Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner, or at all. If any collaborations that AavantiBio enters into do not result in the successful development and commercialization of products or if one of AavantiBio’s collaborators terminates its agreement with it, AavantiBio may not receive any future research funding or milestone or royalty payments under the collaboration. If AavantiBio does not receive the funding it expects under these agreements, AavantiBio’s development of its product candidates could be delayed and AavantiBio may need additional resources to develop its product candidates.

Additionally, subject to its contractual obligations to AavantiBio, if a collaborator of AavantiBio is involved in a business combination, the collaborator might deemphasize or terminate the development or commercialization of any product candidate licensed to it by AavantiBio. If one of AavantiBio’s collaborators terminates its agreement with it, AavantiBio may find it more difficult to attract new collaborators and AavantiBio’s perception in the business and financial communities could be adversely affected.

AavantiBio may seek to establish strategic partnerships for developing AVB-202, AVB-401 or its other product candidates due to capital costs required to develop, manufacture and commercialize its product candidates. AavantiBio may not be successful in its efforts to establish such strategic partnerships or other alternative arrangements because, among other things, AavantiBio’s research and development pipeline may be insufficient, AVB-202 or AVB-401 may be deemed to be at too early of a stage of development for collaborative effort or third parties may not view AVB-202 or AVB-401 as having the requisite potential to demonstrate safety and efficacy. AavantiBio cannot be certain that, following a strategic transaction, it will achieve an economic or business benefit that justifies such transaction. If AavantiBio seeks to but is unable to reach agreements with suitable collaborators on a timely basis, on acceptable terms or at all, AavantiBio may have to curtail, reduce or delay the development of a product candidate, delay its

potential commercialization, reduce the scope of any sales or marketing activities or increase AavantiBio’s expenditures and undertake development, manufacturing or commercialization activities independently. If AavantiBio elects to fund its own independent development or commercialization activities, AavantiBio will need to obtain additional expertise and additional capital, which may not be available to it on acceptable terms or at all. If AavantiBio fails to enter into collaborations and does not have sufficient funds or expertise to undertake the necessary development, manufacturing and commercialization activities, AavantiBio may not be able to further develop AVB-202, AVB-401 or its other product candidates.

AavantiBio currently focuses its research and product development on treatments for Friedreich’s ataxia, BAG3-related cardiomyopathy and other pipeline indications. AavantiBio’s understanding of the patient populations with these diseases is based on estimates in published literature. These estimates may prove to be incorrect and new studies may reduce the estimated incidence or prevalence of these diseases. The number of patients in the United States and elsewhere may turn out to be lower than expected, patients may not be otherwise amenable to treatment with AavantiBio’s product candidates or patients may become increasingly difficult to identify and access.

Further, there are several factors that could contribute to making the actual number of patients who receive AVB-202, AVB-401 or other pipeline candidate products less than the potentially addressable market. These include the lack of widespread availability of, and limited reimbursement for, new therapies in many underdeveloped markets. Further, it is possible that the severity of the progression of a degenerative disease such as Friedreich’s ataxia up to the time of treatment may diminish the therapeutic benefit conferred by a gene therapy due to irreversible cell damage.

Certain patients’ immune systems might inhibit the successful delivery of certain gene therapy products, thereby potentially limiting the population of patients amenable to gene transfer. While AavantiBio is working to better understand the prevalence of antibodies to AAV, or seroprevalence, as it relates to gene therapies for Friedreich’s ataxia, the exact Friedreich’s ataxia-wide seroprevalence of such antibodies is currently unknown and it varies by AAV serotype and age of the patient. AavantiBio may not be able to address this potentially limiting factor for gene therapy as a treatment for certain patients.

Even with the requisite approvals from the FDA in the United States and other regulatory authorities internationally, the commercial success of AVB-202 will depend, in part, on the acceptance of physicians, patients and health care payors of gene therapy products in general, and AVB-202 in particular, as medically necessary, cost-effective and safe. Any product that AavantiBio commercializes may not gain acceptance by physicians, patients, health care payors and others in the medical community due to ethical, social, medical and legal concerns. If these products do not achieve an adequate level of acceptance, AavantiBio may not generate significant product revenue and may not become profitable. The degree of market acceptance of gene therapy products and, in particular, AVB-202, if approved for commercial sale, will depend on multiple factors, including, but not limited to the efficacy and safety of AVB-202, the perceived advantages of AVB-202 over alternative treatments, the cost of treatment relative to alternative treatments, the willingness of physicians to prescribe new therapies, the willingness of the target patient population to try new therapies and favorable third-party payor coverage and adequate reimbursement. Even if a potential product candidate displays a favorable efficacy and safety profile in preclinical studies and clinical trials, market acceptance of the product will not be fully known until after it is launched.

AavantiBio’s efforts to educate the medical community and third-party payors on the benefits of AVB-202, AVB-401 and its other product candidates may require significant resources and may never be successful. Such efforts may require more resources than are typically required due to the complexity and uniqueness of AavantiBio’s potential product candidates. If AVB-202, AVB-401 or AavantiBio’s other product candidates are approved but fail to achieve market acceptance among physicians, patients or third-party payors, AavantiBio will not be able to generate significant revenue from any such product.

Gene transfer remains a novel technology and public perception may be influenced by claims that gene transfer is unsafe, and gene transfer may not gain the acceptance of the public or the medical community. In particular, AavantiBio’s success will depend upon physicians who specialize in the treatment of Friedreich’s ataxia prescribing treatments that involve the use of AVB-202 in lieu of, or in addition to, other treatments with which they are more familiar and for which greater clinical data may be available. More restrictive government regulations or negative public opinion may delay or impair the development and commercialization of AVB-202 or demand for any product candidate AavantiBio may develop. A public backlash developed against gene therapy following the death of a patient in 1999 during a gene therapy clinical trial of research subjects with ornithine transcarbamylase, or OTC, deficiency, a rare disorder in which the liver lacks a functional copy of the OTC gene. The death of the clinical trial subject was due to complications of adenovirus vector administration. Serious adverse events in clinical trials, even if not ultimately attributable to the relevant product candidates, and the resulting publicity, could result in increased government regulation, unfavorable public perception, potential regulatory delays in the testing or approval of a product candidate, stricter labeling requirements for a product candidate if approved and a decrease in demand for a product candidate.

AavantiBio’s ability to develop and commercialize AVB-202, AVB-401 and its other product candidates is heavily dependent on licenses to patent rights and other intellectual property granted to it by third parties. In particular, AavantiBio has licensed certain patents and patent applications from third parties that are important or necessary to the development of AVB-202 and other elements of AavantiBio’s gene transfer program. AavantiBio’s existing license agreements impose, and AavantiBio expects that future license agreements will impose, various diligence, development and commercialization obligations, milestone payments, royalties and other obligations on AavantiBio. If AavantiBio fails to comply with its obligations under these agreements, AavantiBio may be subject to damages, which may be significant, and the licensor may have the right to terminate the license, in which event AavantiBio may not be able to develop or market product candidates or technologies covered by the license, including AVB-202 or AVB-401. In addition, certain of these license agreements are not assignable by AavantiBio without the consent of the respective licensor, which may have an adverse effect on its ability to engage in certain transactions.

Under AavantiBio’s existing license agreements, AavantiBio does not have, and under future license agreements may not have, the right to control the preparation, filing and prosecution of patent applications, or the maintenance, enforcement and defense of the patents and patent applications that it licenses from third parties. If AavantiBio’s licensors fail to maintain, enforce or defend such patents, or lose rights to those patents or patent applications, the rights AavantiBio has licensed may be reduced or eliminated and its right to develop and commercialize any of AavantiBio’s product candidates that are the subject of such licensed rights, including AVB-202, could be adversely affected.

Moreover, licenses to additional third-party intellectual property, technology and materials may be required for AavantiBio’s development programs but may not be available in the future or may not be available on commercially reasonable terms. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies may pursue strategies to license or acquire third-party intellectual property rights that AavantiBio may consider attractive. These established companies may have a competitive advantage over AavantiBio due to their size, capital resources and greater clinical development and commercialization capabilities. In addition, companies that perceive AavantiBio to be a competitor may be unwilling to assign or license rights to it. AavantiBio also may be unable to license or acquire third-party intellectual property rights on terms that would allow AavantiBio to make an appropriate return on its investment. Moreover, even if AavantiBio is able to obtain such licenses, they may only be non-exclusive, which could permit competitors and other third parties to use the same intellectual property in competition with AavantiBio.

AavantiBio may collaborate with non-profit and academic institutions to accelerate its preclinical research or development under written agreements with these institutions. These institutions may provide AavantiBio with an

option to negotiate a license to any of the institution’s rights in technology resulting from the collaboration. Regardless of such option, AavantiBio may be unable to negotiate a license within the required timeframe or under terms that are acceptable to it. If AavantiBio is unable to do so, the institution may offer the intellectual property rights to other parties, potentially blocking AavantiBio ability to pursue its program.

If AavantiBio is unable to successfully obtain rights to any third-party intellectual property rights, or successfully challenge such rights, that are required for the development and commercialization of AVB-202, AVB-401 or any of its other product candidates, and such third-party intellectual property rights are successfully asserted against it, AavantiBio may be liable for damages, which may be significant, and AavantiBio may be required to cease the development and commercialization of AVB-202, AVB-401 or its other product candidates.

AavantiBio’s success depends, in large part, on AavantiBio’s and its licensors’ ability to seek, obtain, maintain, enforce and defend patent rights in the United States and other countries with respect to AVB-202, AVB-401, its other product candidates and AavantiBio’s future innovation related to its manufacturing technology. AavantiBio’s licensors and AavantiBio have sought, and AavantiBio intends to continue to seek, to protect its proprietary position by filing patent applications in the United States and, in at least some cases, one or more countries outside the United States related to AVB-202, AVB-401 and certain other product candidates that are important to AavantiBio’s business. However, AavantiBio cannot predict whether the patent applications it and its licensors are currently pursuing will issue as patents or whether the claims of any issued patents will provide AavantiBio with a competitive advantage.

Moreover, although AavantiBio has pending patent applications in the United States and abroad, AavantiBio cannot predict whether or in which jurisdictions the pending applications will result in issuance of patents that effectively protect any of its product candidates or will effectively prevent others from commercializing competitive products. Further, each of the provisional patent applications is not eligible to become an issued patent until, among other things, AavantiBio files a non-provisional patent application within 12 months of the filing date of each provisional patent application. If AavantiBio does not timely file a non-provisional patent application in respect of a provisional patent application, it may lose its priority date with respect to such provisional patent application and any patent protection on the inventions disclosed in such provisional patent application. While AavantiBio intends to timely file non-provisional patent applications relating to its provisional patent applications, AavantiBio cannot predict whether such future patent applications will result in the issuance of patents that effectively protect any of its product candidates or will effectively prevent others from commercializing competitive products.

The patent prosecution process is expensive, time-consuming and complex, and AavantiBio and its licensors may not be able to file, prosecute, maintain, enforce, defend or license all necessary or desirable patents and patent applications at a reasonable cost or in a timely manner.

It is also currently unknown what claims may, if ever, issue from pending applications included in AavantiBio’s patent rights. Additionally, certain of AavantiBio’s in-licensed U.S. patent rights lack corresponding foreign patents or patent applications, and therefore it will be unable to obtain patent protection for its product candidates in certain jurisdictions. AavantiBio or its licensors may not be able to obtain or maintain patent protection with respect to AVB-202, AVB-401 or its other product candidates.

Changes in either the patent laws or their interpretation in the United States and other countries may diminish AavantiBio’s ability to protect its inventions, obtain, maintain and enforce its intellectual property rights, and more generally, could affect the value of AavantiBio’s intellectual property rights or narrow the scope of its licensed patents or future owned patents.

It is also possible that AavantiBio will fail to identify patentable aspects of its research and development output before it is too late to obtain patent protection. Although AavantiBio enters into non-disclosure and

confidentiality agreements with parties who have access to confidential or patentable aspects of its research and development output, such as its employees, corporate collaborators, outside scientific collaborators, contract research organizations, or CROs, contract manufacturers, consultants, advisors and other third parties, any of these parties may breach the agreements and disclose such output before a patent application is filed, thereby jeopardizing AavantiBio’s ability to seek patent protection.

The patent position of biotechnology and pharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has, in recent years, been the subject of much litigation. As a result, the issuance, scope, validity, enforceability and commercial value of AavantiBio’s patent rights are highly uncertain. Patent applications included in AavantiBio’s current and future patent rights may not result in patents being issued that protect its product candidates, effectively prevent others from commercializing competitive products or otherwise provide any competitive advantage. In fact, patent applications may not issue as patents at all. Even assuming patents issue from patent applications in which AavantiBio has rights, changes in either the patent laws or interpretation of the patent laws in the United States and other jurisdictions may diminish the value of AavantiBio’s patents or narrow the scope of its patent protection.

Other parties have developed products that may be related or competitive to those of AavantiBio and such parties may have filed or may file patent applications, or may have received or may receive patents, claiming inventions that may overlap or conflict with those claimed in AavantiBio’s patent applications or issued patents. AavantiBio may not be aware of all third-party intellectual property rights potentially relating to AVB-202, AVB-401 or its other current or future product candidates. In addition, AavantiBio cannot provide any assurances that any of the inventions disclosed in its patent applications will be found to be patentable, including over third-party or its own prior art patents, publications or other disclosures, or will issue as patents. Even if AavantiBio’s patent applications issue as patents, AavantiBio cannot provide any assurances that such patents will not be challenged or ultimately held to be invalid or unenforceable. Publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and in other jurisdictions are typically not published until 18 months after filing, or, in some cases, at all. Therefore, AavantiBio cannot know with certainty whether the inventors of its licensed patents and applications were the first to make the inventions claimed in those patents or pending patent applications, or that they were the first to file for patent protection of such inventions. Similarly, should AavantiBio own any issued patents or patent applications in the future, AavantiBio may not be certain that it was the first to file for patent protection for the inventions claimed in such patents or patent applications. Furthermore, given the differences in patent laws in the United States, Europe and other foreign jurisdictions, for example, the availability of grace periods for filing patent applications and what can be considered as prior art, AavantiBio cannot make any assurances that any claims in its pending and future patent applications in the United States or other jurisdictions will issue, or if they do issue, whether they will issue in a form that provides AavantiBio with any meaningful competitive advantage. Similarly, AavantiBio cannot make any assurances that if the patentability, validity, enforceability or scope of its pending or future patents and patent applications in the United States or foreign jurisdictions are challenged by any third party, that the claims of such pending or future patents and patent applications will survive any such challenge in a form that provides AavantiBio with any meaningful competitive advantage. For example, third-party patents and publications may have earlier priority or publication dates and may be asserted as prior art against AavantiBio’s owned or in-licensed patents and applications. Any such challenge, if successful, could limit or eliminate patent protection for AavantiBio’s products and product candidates or otherwise materially harm its business. As a result, the issuance, scope, validity, enforceability and commercial value of AavantiBio’s patent rights cannot be predicted with any certainty.

Moreover, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted after issuance. Even if patent applications AavantiBio licenses or may own in the future do issue as patents, they may not issue in a form that will provide AavantiBio with any meaningful protection, prevent competitors or other third parties from competing with AavantiBio or otherwise provide it with any competitive advantage. Any patents that AavantiBio licenses or may own in the future may be challenged, narrowed, circumvented, or invalidated by third parties. Consequently, AavantiBio does not know whether any of its product candidates will be protectable or remain protected by valid and enforceable patents. AavantiBio’s competitors or other third parties may be able to circumvent AavantiBio’s patents by developing similar or alternative products in a non-infringing manner

The degree of patent protection AavantiBio requires to successfully compete in the marketplace may be unavailable. AavantiBio cannot provide any assurances that any of the patents or patent applications included in its patent rights include or will include claims with a scope sufficient to protect AVB-202, AVB-401 and AavantiBio’s other product candidates or otherwise provide any competitive advantage. In addition, the laws of foreign countries may not protect AavantiBio’s proprietary rights to the same extent as the laws of the United States. Furthermore, patents have a limited lifespan. In the United States, the natural expiration of a patent is generally twenty years after it is filed. Certain extensions may be available, however, the life of a patent, and the protection it affords, is limited. Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized. As a result, AavantiBio’s patent rights may not provide it with adequate and continuing patent protection sufficient to exclude others from commercializing products similar or identical to AavantiBio’s product candidates, including biosimilar versions of such products.

Even if AavantiBio acquires patent protection that AavantiBio expects should enable it to maintain some competitive advantage, third parties, including competitors, may challenge the validity, enforceability or scope thereof, which may result in such patents being narrowed, invalidated or held unenforceable. In litigation, a competitor could claim that AavantiBio’s in-licensed patents or any patents it may own in the future are not valid or enforceable for a number of reasons. If a court agrees, AavantiBio would lose its rights to those challenged patents. Third parties also may raise similar claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such proceedings could result in the revocation or cancellation of or amendment to AavantiBio’s licensed patents and any patents it may own in the future in such a way that they no longer cover AVB-202, AVB-401 or AavantiBio’s other product candidates.

Even if issued, the issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and AavantiBio’s current and future patent rights may be challenged in the courts or patent offices in the United States and abroad. For example, AavantiBio may be subject to a third-party submission of prior art to the U.S. Patent and Trademark Office, or USPTO, challenging the validity of one or more claims of patents included in its patent rights. Such submissions may also be made prior to a patent’s issuance, precluding the granting of a patent based on one of the pending patent applications included in AavantiBio’s patent rights. AavantiBio may become involved in opposition, derivation, revocation, reexamination, post-grant and inter partes review, or interference proceedings challenging one or more patents included in its patent rights. A competitor who can establish an earlier filing or invention date may also assert that AavantiBio is infringing their patents and that it therefore cannot practice its technology related to AavantiBio’s product candidates as claimed in the patents or patent applications included in AavantiBio’s patent rights. Competitors may also contest patents or patent applications included in AavantiBio’s patent rights by showing that the claimed subject matter was not patent-eligible, was not novel or was obvious or that the patent claims failed any other requirement for patentability or enforceability. In addition, AavantiBio may in the future be subject to claims by its or its licensors’ current or former employees or consultants asserting an ownership right in the patents or patent applications included in its patent rights as an inventor or co-inventor, as a result of the work they performed.

An adverse determination in any such submission or proceeding may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit AavantiBio’s ability to stop others from using or commercializing similar therapeutics, without payment to AavantiBio, or could limit the duration of the patent protection covering AavantiBio’s product candidates. Such challenges may also result in AavantiBio’s inability to manufacture or commercialize its product candidates without infringing third-party patent rights, and AavantiBio may be required to obtain a license from third parties, which may not be available on commercially reasonable terms or at all, or AavantiBio may need to cease the development, manufacture and commercialization of one or more of its product candidates. In addition, if the breadth or strength of protection provided by the patents and patent applications included in AavantiBio’s patent rights is threatened, it could dissuade companies from collaborating with AavantiBio to license, develop or commercialize current or future product candidates. Such proceedings also may result in substantial cost and require significant time from AavantiBio’s scientists and management, even if the eventual outcome is favorable to AavantiBio.

Even if they are unchallenged, the patents and pending patent applications included in AavantiBio’s patent rights may not provide AavantiBio with any meaningful protection or prevent competitors from designing around its patent claims to circumvent AavantiBio’s patent rights by developing similar or alternative therapeutics in a non-infringing manner. For example, a third party may develop a competitive therapeutic that provides benefits similar to one or more of AavantiBio’s product candidates but that uses a vector or an expression construct that falls outside the scope of AavantiBio’s patent protection. If the patent protection provided by the patents and patent applications AavantiBio licenses or pursues with respect to its product candidates is not sufficiently broad to impede such competition, AavantiBio’s ability to successfully commercialize its product candidates could be negatively affected.

AavantiBio currently depends, and will continue to depend, on its license, collaboration and other similar agreements. Further development and commercialization of AVB-202, AVB-401 and AavantiBio’s other current and future product candidates may require AavantiBio to enter into additional license, collaboration or other similar agreements. The agreements under which AavantiBio currently licenses intellectual property or technology from third parties are complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what AavantiBio believes to be the scope of its rights to the relevant intellectual property or technology, or increase what AavantiBio believes to be its financial or other obligations under the relevant agreement. Moreover, if disputes over intellectual property that AavantiBio has licensed prevent or impair AavantiBio’s ability to maintain its current licensing arrangements on commercially acceptable terms, AavantiBio may be unable to successfully develop and commercialize the affected product candidates.

AavantiBio’s commercial success depends upon its ability and the ability of its future collaborators to develop, manufacture, market and sell AVB-202, AVB-401 and AavantiBio’s other current and future product candidates without infringing, misappropriating or otherwise violating the proprietary rights and intellectual property of third parties. The biotechnology and pharmaceutical industries are characterized by extensive and complex litigation regarding patents and other intellectual property rights. AavantiBio or its licensors may in the future become party to, or be threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to AVB-202, AVB-401 or its other product candidates, including interference proceedings, post grant review and inter partes review before the USPTO. AavantiBio’s competitors or other third parties may assert infringement claims against it, alleging that, among other things, AavantiBio’s therapeutics, manufacturing methods, formulations or administration methods are covered by their patents.

Given the vast number of patents in AavantiBio’s field of technology, AavantiBio cannot be certain or guarantee that a court would hold that AVB-202, AVB-401 or any of its other product candidates does not infringe an existing patent or a patent that may be granted in the future. Many companies and institutions have filed, and continue to file, patent applications related to gene therapy and related manufacturing methods. Some of these patent applications have already been allowed or issued and others may issue in the future. Since this area is competitive and of strong interest to pharmaceutical and biotechnology companies, there will likely be additional patent applications filed and additional patents granted in the future, as well as additional research and development programs expected in the future. Furthermore, because patent applications can take many years to issue, may be confidential for 18 months or more after filing and can be revised before issuance, there may be applications now pending that may later result in issued patents that may be infringed by the manufacture, use, sale or importation of its product candidates and AavantiBio may or may not be aware of such patents. If a patent holder believes the manufacture, use, sale or importation of one of AavantiBio’s product candidates infringes its patent, the patent holder may sue AavantiBio even if it has licensed other patent protection for its product candidates. Moreover, AavantiBio may face patent infringement claims from non-practicing entities that have no relevant product revenue and against whom AavantiBio’s licensed patent portfolio may therefore have no deterrent effect.

It is also possible that AavantiBio has failed to identify relevant third-party patents or applications for which AavantiBio may need a license to develop and commercialize AVB-202, AVB-401 and its other product candidates. For example, applications filed before November 29, 2000 and certain applications filed after that date that will not be filed outside the United States remain confidential until patents issue. Moreover, it is difficult for industry participants, including AavantiBio, to identify all third-party patent rights that may be relevant to its product candidates because patent searching is imperfect due to differences in terminology among patents, incomplete databases and the difficulty in assessing the meaning of patent claims. AavantiBio may fail to identify relevant patents or patent applications or may identify pending patent applications of potential interest but incorrectly predict the likelihood that such patent applications may issue with claims of relevance to AavantiBio’s product candidates. In addition, AavantiBio may be unaware of one or more issued patents that would be infringed by the manufacture, sale or use of a current or future product candidate, or AavantiBio may incorrectly conclude that a third-party patent is invalid, unenforceable or not infringed by its activities. Additionally, pending patent applications that have been published can, subject to certain limitations, be later amended in a manner that could cover AavantiBio’s product candidates.

Third parties may assert infringement claims against AavantiBio based on existing patents or patents that may be granted in the future, regardless of their merit. There is a risk that third parties may choose to engage in litigation with AavantiBio to enforce or to otherwise assert their patent or other intellectual property rights against AavantiBio. For example, third parties may claim that the AAV vectors AavantiBio are developing for use in AVB-202, AVB-401 or its other product candidates are covered by patents held by them. Even if AavantiBio believes such claim, or other intellectual property claims alleged by third parties, are without merit, there is no assurance that AavantiBio would be successful in defending such claims. A court of competent jurisdiction could hold that these third-party patents are valid, enforceable and infringed, which could materially and adversely affect AavantiBio ability to commercialize AVB-202, AVB-401 or its other product candidates covered by the asserted third-party patents. In order to successfully challenge the validity of any such U.S. patent in federal court, AavantiBio would need to overcome a presumption of validity. As this burden is a high one requiring AavantiBio to present clear and convincing evidence as to the invalidity of any such U.S. patent claim, there is no assurance that a court of competent jurisdiction would invalidate the claims of any such U.S. patent. Similarly, there is no assurance that a court of competent jurisdiction would find that AVB-202, AVB-401 or AavantiBio’s other product candidates did not infringe a third-party patent.

Patent and other types of intellectual property litigation can involve complex factual and legal questions, and their outcome is uncertain. If AavantiBio is found, or believes there is a risk that it may be found, to infringe, misappropriate or otherwise violate a third party’s intellectual property rights, and AavantiBio is unsuccessful in demonstrating that such intellectual property rights are invalid or unenforceable, AavantiBio could be required or may choose to obtain a license from such third party to continue developing, manufacturing and marketing its product candidates. However, AavantiBio may not be able to obtain any required license on commercially reasonable terms or at all. Even if AavantiBio is able to obtain a license, it could be non-exclusive, thereby giving AavantiBio’s competitors and other third parties access to the same technologies licensed to AavantiBio , and it could require AavantiBio to make substantial licensing and royalty payments. AavantiBio could be forced, including by court order, to cease developing, manufacturing and commercializing the infringing product candidate, including AVB-202, AVB-401 or its other product candidates. In addition, AavantiBio could be found liable for monetary damages, including treble damages and attorneys’ fees, if it is found to have willfully infringed a patent or other intellectual property right. A finding of infringement, misappropriation or other violation of intellectual property rights, or claims that AavantiBio has done so, could prevent it from manufacturing and commercializing its product candidates or force AavantiBio to cease some or all of its business operations.

In addition to the protection afforded by patents, AavantiBio relies on trade secret protection and confidentiality agreements to protect proprietary know-how that is not patentable or that AavantiBio elects not to patent, processes for which patents are difficult to enforce and any other elements of the discovery and development processes of AVB-202, AVB-401 and AavantiBio’s other product candidates that involve proprietary know-how, information or technology that is not covered by patents. AavantiBio’s manufacturing process is protected by trade secrets. However, trade secrets can be difficult to protect and some courts inside and outside the United States are less willing or unwilling to protect trade secrets.

AavantiBio seeks to protect its proprietary know-how, trade secrets and processes, in part, by entering into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements or other similar agreements with its employees, consultants, scientific advisors, CROs, manufacturers and contractors. These agreements typically limit the rights of third parties to use or disclose AavantiBio’s confidential information. However, AavantiBio may not be able to prevent the unauthorized disclosure or use of its technical know-how or other trade secrets by the parties to these agreements, despite the existence generally of confidentiality agreements and other contractual restrictions. AavantiBio cannot guarantee that it has entered into such agreements with each party that may have or have had access to AavantiBio’s trade secrets or proprietary processes. Monitoring unauthorized uses and disclosures is difficult and AavantiBio does not know whether the steps it has taken to protect its proprietary know-how and trade secrets will be effective. If any of AavantiBio’s employees, collaborators, CROs, manufacturers, consultants, advisors and other third parties who are parties to these agreements breaches or violates the terms of any of these agreements, AavantiBio may not have adequate remedies for any such breach or violation. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive, and time-consuming, and the outcome is unpredictable. As a result, AavantiBio could lose its trade secrets. AavantiBio also seeks to preserve the integrity and confidentiality of its data and trade secrets by maintaining physical security of its premises and physical and electronic security of its information technology systems. While AavantiBio has confidence in these security measures, they may still be breached, and AavantiBio may not have adequate remedies for any breach.

In addition, AavantiBio’s trade secrets may otherwise become known or be independently discovered by competitors. Competitors could purchase AavantiBio’s product candidates, if approved, and attempt to replicate or reverse engineer some or all of the competitive advantages AavantiBio derives from its development efforts, willfully infringe, misappropriate or otherwise violate AavantiBio’s intellectual property rights, design around AavantiBio’s protected know-how and trade secrets, or develop their own competitive technologies that fall outside of AavantiBio’s intellectual property rights. If any of AavantiBio’s trade secrets were to be lawfully obtained or independently developed by a competitor, AavantiBio would have no right to prevent them, or those to whom they communicate such trade secrets, from using that technology or information to compete with AavantiBio. If AavantiBio’s trade secrets are not adequately protected so as to protect its market against competitors’ products and technologies, its competitive position could be adversely affected.

Certain of AavantiBio’s employees, consultants or advisors are currently, or were previously, employed at universities or other biotechnology or pharmaceutical companies, including AavantiBio’s competitors or potential competitors, as well as AavantiBio’s academic partners. Although AavantiBio tries to ensure that its employees, consultants and advisors do not use the proprietary information or know-how of others in their work for it, AavantiBio may be subject to claims that these individuals or AavantiBio has used or disclosed intellectual property, including trade secrets or other proprietary information, of any such individual’s current or former employer. Litigation may be necessary to defend against these claims. If AavantiBio fails in defending any such claims, in addition to paying monetary damages, it may lose valuable intellectual property rights or personnel. An inability to incorporate such technologies or features would have a material adverse effect on AavantiBio’s business and may prevent AavantiBio from successfully commercializing its product candidates. Moreover, any such litigation or the threat of such litigation may adversely affect AavantiBio’s ability to hire employees or contract with independent contractors. A loss of key personnel or their work product could hamper or prevent AavantiBio’s ability to commercialize its product candidates. Even if AavantiBio is successful in defending against such claims, litigation could result in substantial costs and be a distraction to management.

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

intellectual property. Moreover, individuals executing agreements with AavantiBio may have preexisting or competing obligations to a third party, such as an academic institution, and thus an agreement with AavantiBio may be ineffective in perfecting ownership of inventions developed by that individual.

Although Solid expects that the combined company will have approximately $215.0 million in cash and investments at the closing of the Acquisition, which Solid expects will provide the combined company cash runway into 2025, following such period of time (or during that period of time, if the combined company depletes it capital resources sooner than expected), the combined company will require additional funds to continue the development and potential commercialization of SGT-003, AVB-202 and any other product candidates it develops. The combined company’s future capital requirements will depend upon a number of factors, including: the number and timing of future product candidates in the pipeline; progress with and results from preclinical testing and clinical trials; the ability to manufacture sufficient drug supplies to complete preclinical studies and clinical trials; the costs involved in preparing, filing, acquiring, prosecuting, maintaining and enforcing patent and other intellectual property claims; and the time and costs involved in obtaining regulatory approvals and favorable reimbursement or formulary acceptance.

Raising additional capital may be costly or difficult to obtain and could significantly dilute stockholders’ ownership interests or inhibit the combined company’s ability to achieve its business objectives. It is also possible that the terms of any new equity securities may have preferences over the combined company’s common stock. Any debt financing the combined company enters into may involve covenants that restrict its operations. These restrictive covenants may include limitations on additional borrowing and specific restrictions on the use of the combined company’s assets, as well as prohibitions on its ability to create liens, pay dividends, redeem its stock or make investments. In addition, if the combined company raises additional funds through licensing arrangements, it may be necessary to grant licenses on terms that are not favorable to the combined company. Even if the combined company were to obtain sufficient funding, there can be no assurance that it will be available on terms acceptable to the combined company or its stockholders.

The market price of the combined company’s common stock following the Acquisition could be subject to significant fluctuations and may drop following the Acquisition. Some of the factors that may cause the market price of the combined company’s common stock to fluctuate include:

Moreover, the stock markets in general have experienced substantial volatility that has often been unrelated to the operating performance of individual companies. These broad market fluctuations may also adversely affect the trading price of the combined company’s common stock. In addition, a recession, depression or other sustained adverse market event resulting from the spread of COVID-19 or otherwise could materially and adversely affect the combined company’s business and the value of its common stock. In the past, following periods of volatility in the market price of a company’s securities, stockholders have often instituted class action securities litigation against such companies. Furthermore, market volatility may lead to increased shareholder activism if the combined company experiences a market valuation that activists believe is not reflective of its intrinsic value. Activist campaigns that contest or conflict with the combined company’s strategic direction or seek changes in the composition of its board of directors could have an adverse effect on its operating results and financial condition.

The Acquisition involves the combination of two companies which currently operate as independent companies. Following the Acquisition, the combined company will focus on advancing a portfolio of neuromuscular and cardiac programs, led by SGT-003, a differentiated gene transfer candidate, for the treatment of Duchenne. Additional pipeline programs include AVB-202, a gene transfer candidate for the treatment of Friedreich’s ataxia, AVB-401 for BAG3 mediated dilated cardiomyopathy, and additional assets for the treatment of undisclosed cardiac diseases. The combined company will be required to devote significant management attention and resources to integrating its business practices and operations. The combined company may fail to realize some or all of the anticipated benefits of the Acquisition, including if the integration process takes longer than expected or is more costly than expected. Potential difficulties the combined company may encounter in the integration process include the following:

In addition, Solid and AavantiBio have operated and, until the completion of the Acquisition, will continue to operate, independently. It is possible that the integration process also could result in the diversion of each company’s management’s attention, the disruption or interruption of, or the loss of momentum in, each company’s ongoing businesses or inconsistencies in standards, controls, procedures and policies, any of which could adversely affect the combined company’s ability to maintain its relationships with third parties or the ability to achieve the anticipated benefits of the Acquisition, or could otherwise adversely affect the business and financial results of the combined company.

Neither Solid nor AavantiBio have commercialized a product or generated revenue from the sale of any products. The combined company is expected to incur significant net losses for the foreseeable future and may never achieve or maintain profitability. Developing pharmaceutical products, including conducting preclinical studies and clinical trials, is a time-consuming, expensive and uncertain process that takes years to complete. SGT-003 and AVB-202 are gene transfer candidates based on novel technology, which makes it difficult to predict the time and cost of development and of subsequently obtaining regulatory approval for such product candidates. The combined company may never generate the necessary data or results required to obtain marketing approval for any product candidates or generate revenue from the sale of any products for which the combined company may obtain marketing approval. Solid and AavantiBio cannot predict when, or if, the combined company will obtain regulatory approval to commercialize SGT-003, AVB-202 or other future product candidates.

The unaudited pro forma financial data for Solid and AavantiBio included in this proxy statement are presented for illustrative purposes only and are not necessarily indicative of the combined company’s actual financial condition or results of operations of future periods, or the financial condition or results of operations that would have been realized had the entities been combined during the periods presented. The combined company’s actual results and financial position after the Acquisition may differ materially and adversely from the unaudited pro forma financial data included in this proxy statement. The aggregate consideration payable by Solid, including the estimated number of shares of Solid common stock to be issued in the Acquisition, reflected in this proxy statement is preliminary. In addition, Solid’s unaudited pro forma Purchase Price (as defined below) allocation includes acquired in-process research and development (“IPR&D”) with a preliminary fair value of approximately $6.9 million. Solid tests IPR&D for impairment at least annually for events or circumstances that may indicate a possible impairment exists. If an impairment is identified, Solid would be required to record an impairment charge with respect to the impaired asset to the period in which the determination is made. A significant impairment charge could have a material negative impact on Solid’s financial condition and results of operations. Solid will continue to evaluate its intangible assets for potential impairment in accordance with its accounting policies. The unaudited pro forma financial statements have been derived from the historical financial statements of Solid and AavantiBio and adjustments and assumptions have been made regarding the combined company after giving effect to the transaction. The information upon which these adjustments and assumptions have been made is preliminary, and these kinds of adjustments and assumptions are difficult to make with accuracy. Moreover, the unaudited pro forma financial statements do not reflect all costs that are expected to be incurred by the combined company in connection with the transactions or that have been incurred since the date of such unaudited pro forma financial statements. The assumptions used in preparing the unaudited pro forma financial information may not prove to be accurate, and other factors may affect the combined company’s financial condition following the Acquisition. For more information see the section titled “Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 202 of this proxy statement.

The current expectation is that the combined company will retain its future earnings, if any, to finance the growth and development of the combined company’s business as opposed to paying dividends. As a result, capital appreciation, if any, of the common stock of the combined company will be your sole source of gain, if any, for the foreseeable future.

The combined company may be exposed to increased litigation from stockholders, customers, suppliers, consumers and other third parties due to the combination of Solid’s and AavantiBio’s businesses following the Acquisition. Such litigation may have an adverse impact on the combined company’s business and results of operations or may cause disruptions to the combined company’s operations. In addition, in the past, stockholders have initiated class action lawsuits against biotechnology companies following periods of volatility in the market prices of these companies’ stock. Such litigation, if instituted against the combined company, could cause the combined company to incur substantial costs and divert management’s attention and resources, which could have a material adverse effect on the combined company’s business, financial condition and results of operations.

If existing securityholders of Solid and AavantiBio sell, or indicate an intention to sell, substantial amounts of the combined company’s common stock in the public market after legal restrictions on resale discussed in this proxy statement lapse, the trading price of the common stock of the combined company could decline. Based on shares of common stock outstanding as of September 30, 2022, and after giving effect the shares of common stock to be issued in the Private Placement and the shares of common stock expected to be issued upon completion of the Acquisition, the combined company is expected to have outstanding a total of approximately 19,525,475 shares of common stock immediately following the completion of the Acquisition and the Private Placement. The combined company has agreed to file a registration statement covering the resale of the shares issued in the Acquisition and the Private Placement within 60 days of the closing of the Private Placement. The combined company has agreed to keep such registration statement effective until the date the shares covered by such registration statement have been sold or can be resold without restriction under Rule 144 of the Securities Act. If outstanding shares of common stock are sold, the trading price of the combined company’s common stock could decline.

Upon the completion of the Acquisition and the Private Placement, it is anticipated that the combined company’s executive officers, directors and principal stockholders, including entities affiliated with Perceptive, RA Capital and Bain, will, in the aggregate, beneficially own approximately 52% of the combined company’s outstanding shares of common stock. As a result, if these stockholders were to choose to act together, they would be able to control or significantly influence all matters submitted to the combined company’s stockholders for approval, as well as the combined company’s management and affairs. For example, these persons, if they choose to act together, would control or significantly influence the election of directors and approval of any merger, consolidation or sale of all or substantially all of the combined company’s assets. This concentration of voting power could delay or prevent an acquisition of the combined company on terms that other stockholders may desire.

The combined company will have broad discretion over the use of the cash, cash equivalents and available-for-sale securities of the combined company and the proceeds from the Private Placement. You may not agree with the combined company’s decisions, and its use of the proceeds may not yield any return on your

investment. The combined company’s failure to apply these resources effectively could compromise its ability to pursue its growth strategy and the combined company might not be able to yield a significant return, if any, on its investment of these net proceeds. You will not have the opportunity to influence its decisions on how to use the combined company’s cash resources.

The combined company’s ability to compete in the highly competitive pharmaceuticals industry depends on its ability to attract and retain highly qualified managerial, scientific, medical, legal, sales and marketing and other personnel. The combined company will be highly dependent on its management and scientific personnel. The loss of the services of any of these individuals could impede, delay or prevent the successful development of the combined company’s product candidates, completion of its planned clinical trials, commercialization of its product candidates or in-licensing or acquisition of new assets and could impact negatively its ability to implement successfully its business plan. If the combined company loses the services of any of these individuals, it might not be able to find suitable replacements on a timely basis or at all, and its business could be harmed as a result. The combined company might not be able to attract or retain qualified management and other key personnel in the future due to the intense competition for qualified personnel among biotechnology, pharmaceutical and other businesses.

This proxy statement contains forward-looking statements relating to Solid, AavantiBio, the Acquisition, the Private Placement and the other proposed transactions contemplated thereby.

These forward-looking statements include, without limitation, statements regarding: future expectations, plans and prospects for Solid, AavantiBio and Post-Closing Solid following the anticipated consummation of the Acquisition; the anticipated benefits of the Acquisition; the anticipated timing of the Acquisition and the Private Placement; the anticipated milestones, business focus and pipeline of the combined company following the closing of the Acquisition; the expected stock consideration to be issued in the Acquisition; the expected cash and cash investments of the combined company at closing of the transactions and the cash runway of Post-Closing Solid; the expected management team and board of Post-Closing Solid; Solid’s SGT-003 program for Duchenne muscular dystrophy, including expectations for filing an IND and initiating dosing; and AavantiBio’s AVB-202 program for Friedreich’s ataxia and AVB-401 program for BAG3 mediated dilated cardiomyopathy, including expectations for filing an IND for AVB-202. In addition, any statements that refer to projections, forecasts or other characterizations of future developments or circumstances, including any underlying assumptions, are forward-looking statements. The words “aim,” “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “working,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements are based on management’s current expectations and beliefs concerning future events and their potential effects. There can be no assurance that future developments affecting Solid, AavantiBio or the proposed transactions will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond Solid’s or AavantiBio’s control) or other assumptions that could cause actual results or performance to differ materially and adversely from those set forth in, expressed or implied by, such forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties associated with: completion of the Acquisition and the Private Placement in a timely manner or on the anticipated terms or at all; the satisfaction (or waiver) of closing conditions to the consummation of the Acquisition and the Private Placement, including with respect to the approval of the Share Issuance Proposal by Solid’s stockholders at the Special Meeting; the occurrence of any event, change or other circumstance or condition that could give rise to the termination of the Merger Agreement or the Private Placement; the effect of the announcement or pendency of the Acquisition on Solid’s or AavantiBio’s business relationships, operating results and business generally; the ability to recognize the anticipated benefits of the Acquisition; the outcome of any legal proceedings that may be instituted against Solid or AavantiBio following any announcement of the Acquisition and related transactions; the ability to obtain or maintain the listing of the common stock of Post-Closing Solid on the Nasdaq Stock Market following the Acquisition; risks related to Solid’s and AavantiBio’s ability to correctly estimate their respective operating expenses and expenses associated with the transaction, as well as uncertainties regarding the impact any delay in the closing would have on the anticipated cash resources of Post-Closing Solid upon the closing and other events and unanticipated spending and costs that could reduce Post-Closing Solid’s cash resources; costs related to the Acquisition, including unexpected costs, charges or expenses resulting from the Acquisition; changes in applicable laws or regulation; the possibility that Solid or AavantiBio may be adversely affected by other legislative, regulatory, political, economic, business and/or competitive factors and developments; competitive responses to the Acquisition and the Private Placement; risks related to Solid’s continued listing on the Nasdaq Global Select Market; Solid’s ability to advance its SGT-003 program on the timelines expected or at all, obtain and maintain necessary approvals from the U.S. Food and Drug Administration (“FDA”) and other regulatory authorities; following the Acquisition, Solid’s ability to advance the programs acquired from AavantiBio, including the AVB-202 and AVB-401 programs, on the timelines expected or at all, obtain and maintain necessary approvals from the FDA and other regulatory authorities; obtaining and maintaining the necessary approvals from investigational review boards at clinical trial sites and independent data safety monitoring board; replicating in clinical trials positive results found in preclinical studies and early-stage clinical trials of product candidates; whether the methodologies, assumptions and applications utilized to assess particular safety or efficacy parameters will yield meaningful statistical results; advancing the development of product candidates under the timelines it anticipates in current and future clinical trials; successfully transitioning, optimizing and scaling Solid’s manufacturing process; obtaining, maintaining or protecting intellectual property rights related to Solid’s and AavantiBio’s product candidates; competing successfully with other companies that are seeking to develop treatments for Duchenne, Friedreich’s ataxia and BAG3 mediated dilated cardiomyopathy, as well as

other gene therapies; managing expenses; and raising the substantial additional capital needed, on the timeline necessary, to continue development of SGT-003, AVB-202, AVB-401 and other product candidates; achieving Solid’s other business objectives and continuing as a going concern. Should one or more of these risks or uncertainties materialize, or should any of the assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Some of these risks and uncertainties may in the future be amplified by the ongoing COVID-19 pandemic and there may be additional risks that Solid considers immaterial or which are unknown. It is not possible to predict or identify all such risks. The forward-looking statements only speak as of the date they are made, and Solid does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

For a discussion of the factors that may cause Solid, AavantiBio or Post-Closing Solid’s actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied in such forward-looking statements, or for a discussion of risks associated with the ability of Solid and AavantiBio to complete the Acquisition and the Private Placement and the effects of the Acquisition on the business of Solid, AavantiBio and Post-Closing Solid, please see the section titled “Risk Factors” beginning on page 10 of this proxy statement. Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in reports filed with the Securities and Exchange Commission (“SEC”) by Solid. Please see the section titled “Where You Can Find More Information” beginning on page 213 of this proxy statement. There can be no assurance that the Acquisition and the Private Placement will be completed, or if completed, that such transactions will be completed within the anticipated time period or that the expected benefits of the Acquisition and the Private Placement will be realized.

If any of these risks or uncertainties materialize or any of these assumptions prove incorrect, the results of Solid, AavantiBio or Post-Closing Solid could differ materially from the forward-looking statements. All forward-looking statements in this proxy statement are current only as of the date on which the statements were made. Solid and AavantiBio do not undertake any obligation (and expressly disclaim any such obligation) to publicly update any forward-looking statement to reflect events or circumstances after the date on which any statement is made or to reflect the occurrence of unanticipated events, except as required by applicable law.

The terms of the Merger Agreement are the result of arm’s-length negotiations between representatives of Solid and AavantiBio. The following is a brief discussion of the background of these negotiations, the Merger Agreement and the Acquisition.

In an effort to enhance stockholder value, the Solid board of directors and Solid executive management regularly review and discuss Solid’s near- and long-term operating and strategic priorities. Among other things, these reviews and discussions focus on the opportunities and risks associated with Solid’s development programs, financial condition and availability of sources of capital, and its strategic relationships and potential long-term strategic options. In particular, as part of Solid’s ongoing consideration and evaluation of its long-term prospects and strategies, Solid’s board and management regularly evaluate strategic opportunities involving potential transactions, including licensing transactions, capital raising transactions, partnerships and acquisition opportunities. Further, in the fourth quarter of 2021, Ilan Ganot, Solid’s co-founder, chief executive officer and president, presented a chief executive officer leadership transition proposal to Solid’s board of directors, and the board of directors began discussing in executive session conducting a search for a chief executive officer and chief financial officer, including engaging an executive search firm.

Also, in the fourth quarter of 2021, Solid was engaged in preliminary, exploratory discussions with respect to various licensing or manufacturing transactions and acquisition transactions, and the Solid board had directed management to continue identifying and evaluating potential opportunities. In the course of identifying potential counterparties for licensing, collaboration, manufacturing and/or acquisition opportunities, Solid management and the board of directors of Solid identified potential counterparties, including AavantiBio, and the board directed Solid management to conduct outreach. As part of this outreach, in December 2021, Mr. Ganot reached out to Bo Cumbo, AavantiBio’s chief executive officer, regarding potential business development opportunities between the two companies, given the potential synergies and complementary nature of their pipelines and manufacturing. Mr. Cumbo was receptive to discussions, and each undertook to discuss with their respective boards.

On December 15, 2021, the Solid board of directors held a meeting by videoconference in which members of Solid management were present, along with representatives of Wilmer Cutler Pickering Hale and Dorr LLP (“WilmerHale”), Solid’s outside counsel. During the meeting, following regularly scheduled business, including regarding Solid’s standalone business results, strategy and outlook, Solid management provided an update regarding various preliminary discussions and outreach regarding potential transaction counterparties, including AavantiBio. In connection with Solid’s potential leadership search, Ian Smith was appointed Executive Chair of Solid. During the meeting, Solid management and the Solid board reviewed potential conflicts involving certain members of the board of directors with respect to certain of the potential counterparties to a strategic transaction, including, in particular, that certain of Solid’s directors were affiliated with various investment funds that were investors in, and in some cases had board representation on, certain of the potential counterparties, and/or certain of the directors served on the boards of such potential counterparties. In particular, Adam Stone is chief investment officer of Perceptive Advisors, Rajeev Shah is a portfolio manager and managing director at RA Capital Management, and Dr. Adam Koppel is a managing director of Bain Capital Life Sciences. Each of Perceptive, RA Capital and Bain are investors in AavantiBio, and representatives of Perceptive, RA Capital and Bain serve on the board of directors of AavantiBio. In addition, Ian Smith serves on the board of directors of AavantiBio. Further, Dr. Sukumar Nagendran and the board of directors determined that Dr. Nagendran also had a conflict at such time, unrelated to AavantiBio. The Solid board discussed creating a special transaction committee of independent and disinterested directors, composed of Robert Huffines, Lynne Sullivan, Dr. Martin Freed, Dr. Georgia Keresty and Dr. Clare Khan (the “Transaction Committee”), with Mr. Huffines serving as chair. At the meeting, the board delegated authority to the Transaction Committee to, among other things: direct the process for the review and evaluation of any potential strategic transaction; to provide guidance regarding any potential strategic transaction to Solid management and advisors; identify and engage appropriate advisors in connection with any such strategic transaction; review, evaluate, pursue and reject any potential strategic transaction or counterparty; and recommend to the full board what action, if any, should be taken by the board and Solid with respect to any potential strategic transaction.

On December 20, 2021, the Transaction Committee held a meeting by videoconference in which members of Solid management and representatives of WilmerHale were present. At the meeting, WilmerHale reviewed certain fiduciary duties of the directors. Solid management reviewed for the Transaction Committee the status of

discussions with the various potential counterparties. The Transaction Committee directed Solid management to continue to engage in further discussions with these counterparties with which Solid was in preliminary, exploratory discussions, including AavantiBio.

Between December 20, 2021 and January 7, 2022, Solid management continued preliminary discussions with potential strategic counterparties, including AavantiBio. On January 7, 2022, the Transaction Committee held a meeting by videoconference in which members of Solid management and representatives of WilmerHale were present. Solid management reviewed for the Transaction Committee an overview of the potential transaction structures and pipeline programs of the potential counterparties, as well as information regarding the companies’ cash balances, personnel and other matters. The Transaction Committee directed management to continue to conduct additional diligence, including regarding the pipeline products, personnel, intellectual property arrangements and cash burn of the other potential counterparties.

From January 7, 2022 through January 25, 2022, Solid management engaged in preliminary discussions and due diligence activities regarding the potential counterparties, including regarding the attractiveness of AavantiBio as a potential acquisition target. On January 25, 2022, the Transaction Committee held a meeting by videoconference in which members of Solid management and representatives of WilmerHale were present. At the meeting, Solid management reviewed for the Transaction Committee the status of Solid’s discussions with potential counterparties. In this discussion, Solid management reviewed for the Transaction Committee its due diligence findings with respect to AavantiBio, including regarding AavantiBio’s pipeline assets, the potential for synergies, capital requirements, personnel, and expectations regarding the exchange ratio AavantiBio was likely to require. Following review of these materials and discussions, the Transaction Committee preliminarily determined that the AavantiBio transaction was unlikely to be compelling at that time given the absence of immediate synergies, status of AavantiBio’s programs and the capital requirements of its current development pipeline and research activities. The Transaction Committee directed management of Solid to deliver this message to AavantiBio, which it did following the meeting. The Transaction Committee determined that Solid should continue focusing on its stand-alone prospects while continuing to evaluate other potential transactions.

On January 29, 2022, AavantiBio delivered a non-binding, preliminary proposal to Solid. The non-binding proposal from AavantiBio reflected that Solid and AavantiBio would merge in an all-stock transaction, with AavantiBio shareholders owning 38% of the combined company and Solid shareholders would own 62% of the combined company. The proposal from AavantiBio stated that Mr. Cumbo would be the chief executive officer for the combined company, and the executive leadership team for the combined company would be composed of AavantiBio’s existing executive leadership team, with certain members of Solid’s team having senior roles in the combined company. The proposal also contemplated that the combined company would seek to raise capital in a concurrent private placement financing.

On February 8, 2022, the Transaction Committee held a meeting by videoconference in which members of Solid management and representatives of WilmerHale were present. Solid management reviewed the terms of the proposal received from AavantiBio, including the previously discussed diligence findings regarding synergies, capital requirements and the pipeline assets. The Transaction Committee further discussed the proposed exchange ratio and transaction structure, uncertainty regarding the proposed financing, and the prospects of a combined company. The Transaction Committee unanimously determined that, given the discussions to date, a transaction with AavantiBio on the terms then proposed was not at that time compelling, and it directed management to inform AavantiBio that Solid would focus on its standalone path as well as other strategic alternatives, and was terminating discussions.

On February 14, 2022, the Transaction Committee held a meeting by videoconference, in which members of Solid management and representatives of WilmerHale were present. At this meeting, Solid management confirmed for the Transaction Committee that it had told representatives of AavantiBio that discussions were being terminated, and that Solid would be pursuing its standalone path and other strategic alternatives. At the meeting, the status of discussions regarding other potential transactions was also discussed.

From February 14, 2022 through April 2022, Solid management and the board of directors continued to evaluate other potential strategic transactions, but none of the discussions led to announcement of any transaction or the execution of any letters of intent.

On April 14, 2022, the board of directors of Solid held a meeting by videoconference in which members of Solid management and representatives of WilmerHale were present. At the meeting, among other matters, the board

determined, on the recommendation of the nominating and corporate governance committee, the nominees for re-election as Class I directors at Solid’s upcoming annual meeting of stockholders. The nominating and corporate governance committee did not recommend nominating for re-election, and the board determined not to nominate for re-election, Dr. Koppel, at Dr. Koppel’s request. Dr. Koppel subsequently ceased to be a member of Solid’s board of directors following Solid’s annual meeting held on June 7, 2022. Further, at the April 14, 2022 meeting, management of Solid reviewed for the board its proposals regarding certain updates to Solid’s strategic priorities, including that Solid should focus on developing SGT-001 and SGT-003, and align its organization behind those two programs. In addition, management recommended to the board of directors that Solid use transfection-based manufacturing processes for both SGT-001 and SGT-003, narrow its research and development activities to those related to SGT-001, SGT-003 and next generation capsids, and effect a reduction in headcount. Following discussion, the board determined to proceed with management’s recommendations regarding updates to Solid’s strategic priorities.

On April 27, 2022, in connection with announcing its first quarter earnings results, Solid announced an update to its strategic priorities to focus on developing SGT-001 and SGT-003, and that it would be aligning its organization behind those two programs. These updates included the use of transfection-based manufacturing processes for both SGT-001 and SGT-003, a narrowing of research and development activities to those related to SGT-001, SGT-003 and next generation capsids, and a reduction in headcount by approximately 35 percent.

On May 2, 2022, Mr. Cumbo requested a call with Mr. Ganot to inform Mr. Ganot of certain updates that had occurred at AavantiBio since they had last spoken. In particular, Mr. Cumbo stated that AavantiBio had ceased certain manufacturing activities to focus on its AVB-202 program using transient transfection manufacturing, was planning a reduction in its workforce and attendant reduction in costs, had raised approximately $50.0 million in an equity financing, and was willing to engage in discussions on terms more favorable to Solid than what AavantiBio had previously proposed.

On May 12, 2022, the Transaction Committee held a meeting by videoconference, in which members of Solid management and representatives of WilmerHale were present. At this meeting, Solid management informed the Transaction Committee of the recent developments at AavantiBio, and recommended to the Transaction Committee that exploratory discussions be resumed between the parties regarding a potential transaction. The Transaction Committee and management reviewed the previous diligence performed on AavantiBio to date, as well as the strategic rationale and benefits of a potential transaction with AavantiBio given the changed circumstances. The Transaction Committee directed Solid management to engage in additional discussions and diligence regarding a potential transaction.

On May 20, 2022, the Transaction Committee held a meeting by videoconference, in which members of Solid management and representatives of WilmerHale were present. Solid management reviewed for the board the diligence findings to date, including of AavantiBio’s pipeline assets, the anticipated cash balance and cash needs of the combined company, and potential synergies. Following discussion, the Transaction Committee directed Solid management to tell AavantiBio that Solid was interested in exploring a potential acquisition of AavantiBio, but that, while Solid’s due diligence remained ongoing, the aggregate consideration payable by Solid would in all cases represent an amount less than 19.9% of Solid’s fully diluted equity, and likely materially less than that given the assets and prospects of each company on a standalone basis.

On May 20, 2022, Mr. Ganot delivered the Transaction Committee’s message to Mr. Cumbo. On May 23, 2022, Mr. Cumbo and Mr. Ganot had a follow up conversation, during which Mr. Cumbo stated that AavantiBio was not supportive of a transaction at those levels, and each of Mr. Cumbo and Mr. Ganot agreed that discussions would be terminated but that they would stay in contact in the event that circumstances changed.

From May 23, 2022 through July 30, 2022, Solid continued to focus on its standalone business and other potential alternative transactions. On July 19, 2022, Mr. Cumbo and Mr. Ganot had a meeting to discuss general industry topics, during which time the topic of the previous discussions regarding a potential transaction were mentioned. The following week, Mr. Cumbo told Mr. Ganot that AavantiBio may be interested in revisiting the previous discussions, including with a level of consideration consistent with the feedback from Solid’s Transaction Committee in May 2022.

On July 30, 2022, AavantiBio sent to Solid a non-binding proposal, reflecting an acquisition of AavantiBio by Solid for aggregate merger consideration consisting of shares of Solid common stock equal to 18% of the equity of the combined company, a concurrent private placement of at least $50 million, in which each company’s shareholders would share the dilution, a commitment by AavantiBio to effect certain extensions to its

existing intellectual property arrangements, and that Mr. Cumbo would become the chief executive officer of the combined company, with the rest of the executive leadership team determined by Mr. Cumbo and the Solid board of directors, and that the post-acquisition board of Solid would be as determined by the parties. Mr. Cumbo also orally informed Mr. Ganot that, based on his discussions, Perceptive, RA Capital and Bain had indicated a willingness to invest a significant portion of the anticipated concurrent private placement financing.

On August 2, 2022, the Transaction Committee held a meeting by videoconference, in which members of Solid management and representatives of WilmerHale were present. Solid management reviewed for the board the non-binding proposal received from AavantiBio, as well as Mr. Cumbo’s statements regarding the willingness of certain investors to invest in the anticipated concurrent private placement financing. Following discussion, the Transaction Committee directed management to continue negotiations with AavantiBio regarding a potential transaction, including that Mr. Huffines and Mr. Freed would speak to the current and former directors of Solid affiliated with Perceptive, RA Capital and Bain, respectively, in their capacities as representatives of such investors, regarding their perspective regarding the potential acquisition and willingness to invest in a concurrent financing transaction. Further, the Transaction Committee determined that the independent members of Solid’s nominating and corporate governance committee and certain other members of the Transaction Committee should speak with Mr. Cumbo, and conduct an evaluation process of Mr. Cumbo as potential chief executive officer of a post-acquisition Solid.

On August 5, 2022, the Transaction Committee held a meeting by videoconference, in which members of Solid management and representatives of WilmerHale were present. Solid management reviewed for the board the status of discussions with AavantiBio. Mr. Huffines and Dr. Freed reviewed for the Transaction Committee their conversations with the current and former directors affiliated with Perceptive, RA Capital and Bain, respectively, in their capacities as representatives of such investors, including their support for a potential transaction, willingness to invest in the combined company, and support for Mr. Cumbo as potential chief executive officer of Solid, subject to the review and determination of the independent members of the nominating and corporate governance committee. Solid management also reviewed for the board the status of discussions with other strategic counterparties, including the likelihood and timing of a potential strategic transaction. The Transaction Committee also reviewed and discussed Solid’s stand-alone prospects, Solid’s ability to obtain additional capital, including in the current market environment, and other alternatives reasonably likely to be available to Solid. The Transaction Committee then directed management to send a revised proposal to AavantiBio which would propose, subject to diligence and in particular ongoing review by the Transaction Committee and nominating and corporate governance committee of the board, that the aggregate consideration for the acquisition would consist of shares of stock of Solid equal to 15% of Solid’s equity, support for a concurrent private placement transaction which would equally dilute both companies’ pre-transaction stockholders, that Mr. Cumbo would serve as chief executive officer of the combined company, and that the board of directors of Solid would remain unchanged except that Mr. Cumbo would be appointed to the board, along with an additional director to be determined among the parties, who would be affiliated with a lead investor in the private placement.

Solid delivered to AavantiBio on August 9, 2022 a revised non-binding letter of intent reflecting these terms.

On August 13, 2022, AavantiBio sent a revised non-binding letter of intent, in which it, among other things, indicated acceptance of aggregate consideration of shares of stock of Solid equal to 15% of Solid’s outstanding equity, and proposed potential additional changes to Solid’s post-transaction board, including the addition of a third director. From August 13, 2022 through August 19, 2022, the parties discussed and finalized the terms of the non-binding letter of intent, including AavantiBio’s acceptance that the post-transaction board of Solid would consist of all of Solid’s existing directors, plus Mr. Cumbo and another director determined by the parties who would be affiliated with one of the private placement investors.

On August 16, 2022, the Transaction Committee held a meeting by videoconference, in which members of Solid management and representatives of WilmerHale were present. Solid management reviewed for the board the status of discussions with AavantiBio, and Dr. Keresty provided the Transaction Committee with an update regarding the vetting process for Mr. Cumbo, including discussions to date, as well as the process for review and assessment by Solid’s executive search group. Solid management shared with the Transaction Committee that the non-binding letter of intent with AavantiBio was in near-final form, and was likely to be executed imminently. Solid management also reviewed for the Transaction Committee the process and timeline for the potential private placement transaction, and WilmerHale reviewed for the committee the process and timing for the acquisition, including applicable stockholder

approval requirements. The Transaction Committee directed Solid management to execute the non-binding letter of intent on the terms discussed, and to continue work regarding the private placement transaction, including retaining the assistance of one or more placement agents on customary market terms.

On August 19, 2022, the non-binding letter of intent was executed by each of Solid and AavantiBio.

From August 19, 2022 through August 31, 2022, each of Solid and AavantiBio conducted due diligence with respect to the other party, and discussed the process, structure and timing for the anticipated private placement transaction. During this time, AavantiBio was approached by, and each of AavantiBio and Solid executed confidentiality agreements with, a special purchase acquisition company (“SPAC”), which proposed that, concurrently with the execution of definitive documents for Solid to acquire AavantiBio, Solid would concurrently execute a business combination agreement with the SPAC, and, at closing, the combined company would receive the proceeds from the funds in the SPAC’s trust account, after giving effect to redemptions. On August 24, 2022, AavantiBio and Solid received a non-binding proposal from the SPAC, reflecting this structure along with certain SPAC related terms.

On August 26, 2022, the Transaction Committee held a meeting by videoconference, in which members of Solid management and representatives of WilmerHale were present. During the meeting, representatives of an investment bank with expertise in SPAC transactions also joined for portions of the meeting. Solid management reviewed for the Transaction Committee the status of discussions and due diligence with AavantiBio, as well as the potential SPAC transaction and proposed terms. Solid management, the members of the Transaction Committee, WilmerHale and the investment bank discussed the terms proposed by the SPAC, the potential impact on the timing and ability to consummate the proposed acquisition of AavantiBio, the challenges in the market for transactions with SPACs, including uncertainty regarding the availability of funds in the SPAC trust given the potential for redemptions by SPAC stockholders. Given the priorities for Solid alongside the potential for additional capital into Solid, the Transaction Committee determined that the proposed acquisition of AavantiBio would remain the strategic priority for Solid, but Solid management should continue to explore the potential transaction with the SPAC.

From August 26, 2022 through August 31, 2022, each of Solid and AavantiBio continued discussions with the SPAC, including to improve the terms proposed by the SPAC, as well as to discuss the potential transaction structures and timing. On August 31, 2022, the SPAC, AavantiBio and Solid each mutually agreed, given, among other factors, the challenges in the market for SPACs (including regarding redemptions) and the unique features of the transactions under discussion, to terminate discussions regarding a transaction with the SPAC and allow each party to focus on alternative transactions, including, in the case of Solid, the potential acquisition of AavantiBio.

During the period from September 1, 2022 and September 28, 2022, representatives of Solid and representatives of AavantiBio completed confirmatory due diligence on each other and representatives of WilmerHale and Sidley Austin LLP (“Sidley”) negotiated the terms of the merger agreement drafted by WilmerHale, including the calculation of the aggregate merger consideration (including the inclusion of $1,000 of cash as part of the consideration, to accommodate the tax treatment desired by AavantiBio), the representations and warranties and operating covenants of each party, the amount of the termination fees and expense reimbursement, non-solicitation provisions, the indemnification provisions, and the terms of the forms of support agreement. Also during this period, representatives of Solid and AavantiBio, with the assistance of BofA Securities, which acted as placement agent, engaged in discussions with potential investors for the concurrent private placement. During this period, the Transaction Committee met on six occasions to receive updates regarding, and to review and discuss, the terms of the proposed merger agreement and the terms of the proposed concurrent private placement, as well as to review and determine the post-closing leadership of Solid under Mr. Cumbo and arrangements for Solid employees who would not be continuing as employees following the transaction, including Mr. Ganot. Further, the Transaction Committee and independent members of the nominating and corporate governance committee determined that Dr. Koppel would, upon the closing of the acquisition, again become a director of Solid, given his longstanding relationship with Solid, deep market and industry expertise, and the continued significant investment by Bain, including in the proposed concurrent private placement.

On September 29, 2022, the Transaction Committee held a meeting at which members of Solid management and WilmerHale were present. During the meeting, the representatives of WilmerHale reviewed the fiduciary duties of the Transaction Committee in connection with the proposed transaction with AavantiBio and the concurrent private placement, and the terms of the merger agreement and related documents. The Transaction Committee then discussed various considerations with respect to the proposed transaction. Following discussion

and the presentations, the members of the Transaction Committee unanimously recommended to the Solid board of directors that the Solid board of directors approve the merger agreement, the concurrent private placement and the other transactions contemplated by the merger agreement. Subsequently, also on September 29, 2022, the full board of directors of Solid held a meeting at which members of Solid management and representatives of WilmerHale were present. During the meeting, the representatives of WilmerHale reviewed the fiduciary duties of the Solid board of directors and in connection with the proposed transaction with AavantiBio and the concurrent private placement, and the terms of the merger agreement and related documents. The board and the Transaction Committee then discussed various considerations with respect to the proposed transaction, as summarized under “Solid's Reasons for the Acquisition and the Private Placement”. Following discussion, on the recommendation of the Transaction Committee, the Solid board of directors unanimously approved the merger agreement and the transactions contemplated by the merger agreement and authorized Solid management to execute the merger agreement and documents for the private placement on behalf of Solid.

Subsequently, also on September 29, 2022, Solid and AavantiBio entered into the merger agreement, and Solid executed definitive documents with the investors in the private placement. On September 30, 2022 in advance of the Nasdaq opening for trading, Solid and AavantiBio issued a joint press release announcing the execution of the merger agreement and the agreements for the concurrent financing, and Solid filed a current report on Form 8-K with the SEC announcing the execution of the merger agreement and the agreements for the concurrent private placement.

During the course of its evaluation of the Merger Agreement and the transactions contemplated by the Merger Agreement, each of the board of directors of Solid and the Transaction Committee held numerous meetings, consulted with Solid’s senior management and legal counsel, and reviewed and assessed a significant amount of information. In reaching its decision to approve the Merger Agreement and the other transactions contemplated by the Merger Agreement, including the Private Placement, the Transaction Committee, in connection with its determination and recommendation to the board of directors of Solid, and the board of directors of Solid, following such recommendation by the Transaction Committee, considered a number of factors that it viewed as supporting its decision to approve the Merger Agreement and the other transactions contemplated by the Merger Agreement, including the Private Placement, including:

The Transaction Committee and, following the Transaction Committee’s recommendation, the board of directors of Solid also reviewed the terms of the Merger Agreement and related transaction documents, including those described below, and concluded that the terms of the Merger Agreement and related transaction documents, in the aggregate, were reasonable under the circumstances:

In the course of its deliberations and in addition to the analyses and recommendation of the Transaction Committee, the board of directors of Solid also considered a variety of risks and other countervailing factors related to entering into the Acquisition and the Private Placement, including:

The foregoing information and factors considered by the Transaction Committee and, following the Transaction Committee’s recommendation, the board of directors of Solid are not intended to be exhaustive but are believed to include all of the material factors considered by the Transaction Committee and the board of directors of Solid. In view of the wide variety of factors considered in connection with its evaluation of the Acquisition and the complexity of these matters, the Transaction Committee and the board of directors of Solid did not find it useful, and did not attempt, to quantify, rank or otherwise assign relative weights to these factors. In considering the factors described above, individual members of the Transaction Committee and the board of directors of Solid may have given different weight to different factors. The Transaction Committee and the board of directors of Solid conducted an overall analysis of the factors described above, including thorough discussions with, and questioning of, the Solid management team and the legal advisors of Solid, and considered the factors overall to be favorable to, and to support, its determination.

In considering the recommendation of Solid’s Board of Directors with respect to issuing shares of Solid’s common stock in the Acquisition and the Private Placement and the other matters to be acted upon by Solid’s stockholders at the Special Meeting, Solid’s stockholders should be aware that Solid’s directors and executive officers have interests in the Acquisition and the Private Placement that are different from, or in addition to, the interests of Solid’s stockholders generally. These interests may present them with actual or potential conflicts of interest, and these interests, to the extent material, are described below.

Solid’s Board of Directors was aware of these potential conflicts of interest and considered them, among other matters, in reaching its decision to approve the Merger Agreement, the Acquisition, the Securities Purchase Agreement and the Private Placement and to recommend that Solid’s stockholders approve the proposals to be presented to Solid’s stockholders for consideration at the Special Meeting as contemplated by this proxy statement.

As of September 30, 2022, (i) Solid’s current non-employee directors and executive officers were deemed to beneficially own, in the aggregate, approximately 973,266 of the outstanding shares of Solid’s common stock and (ii) to the knowledge of Solid, Solid’s former non-employee directors and executive officers who served as non-employee directors or executive officers, as applicable, of Solid since the beginning of Solid’s last fiscal year were deemed to beneficially own, in the aggregate, none of the outstanding shares of Solid’s common stock, in each case, which excludes any shares of Solid’s common stock issuable upon exercise or settlement of stock options or restricted stock units held by such individuals.

Certain stockholders of Solid affiliated with Solid’s directors after giving effect to the closing of the Acquisition also currently hold shares of Solid’s common stock. The table below sets forth the ownership of Solid’s common stock by certain of these affiliated entities as of September 30, 2022.

The affirmative vote of a majority of the shares present online or represented by proxy at the Special Meeting, assuming a quorum is present, is required for approval of the Share Issuance Proposal and the Plan Proposal. Certain Solid stockholders who in the aggregate owned as of September 30, 2022 approximately 29.8% of the outstanding shares of Solid’s common stock have entered into a support agreement in connection with the Plan Proposal, including the above listed entities affiliated with RA Capital, Perceptive and Bain Capital Life Sciences. For a more detailed discussion of the support agreements, please see the section titled “Agreements Related to the Acquisition and the Private Placement—Support Agreements” beginning on page 122 of this proxy statement.

Entities affiliated with Perceptive, RA Capital and Bain Capital Life Sciences are also currently principal stockholders of AavantiBio, and such entities have also executed support agreements in connection with, among other matters, approval of the Acquisition and adoption of the Merger Agreement. Upon the effective time of the Acquisition and pursuant to the Merger Agreement, entities affiliated with Perceptive are expected to receive approximately 438,594 shares of Solid’s common stock, entities affiliated with RA Capital are expected to receive approximately 410,027 shares of Solid’s common stock and entities affiliated with Bain Capital Life Sciences are expected to receive approximately 438,593 shares of Solid’s common stock, in each case, in exchange for the shares then-held in AavantiBio, subject to certain adjustments as described in the section titled “The Merger Agreement—Acquisition Consideration” beginning on page 109 of this proxy statement.

Ian Smith is the executive chairman of the Board of Solid. Mr. Smith is on the board of directors of AavantiBio. Mr. Smith is also a stockholder in AavantiBio and is expected to receive approximately 13,171 shares of Solid’s common stock upon the effective time of the Acquisition and pursuant to the Merger Agreement, in exchange for the shares then-held by Mr. Smith in AavantiBio. See the section titled “Interests of AavantiBio’s Directors, Executive Officers and Certain Other Persons in the Acquisition” beginning on page 102 of this proxy statement. For more information about the ownership of Solid’s common stock following the closing of the Acquisition and the Private Placement, see the section titled “Principal Stockholders of Post-Closing Solid” beginning on page 195 of this proxy statement.

Perceptive Life Sciences Master Fund, LTD, RA Capital Healthcare Fund, L.P. and BCLS II Investco, LP have each agreed to purchase in the Private Placement 2,163,120 shares of Solid’s common stock for a total of $15,249,996.00 each. For more information about the ownership of Solid’s common stock following the closing of the Acquisition and the Private Placement, see the section titled “Principal Stockholders of Post-Closing Solid” beginning on page 195 of this proxy statement.

Matthew Arnold was a founding member of Solid and served as a member of Solid’s Board of Directors from 2013 to June 2021. Mr. Arnold has agreed to purchase in the Private Placement 177,304 shares of Solid’s common stock for $1,249,993.20.

All restricted stock units covering shares of Solid’s common stock and all outstanding options to purchase shares of Solid’s common stock will continue, on and after the closing of the Acquisition, in accordance with their terms as of immediately prior to the effective time of the Acquisition.

Each of the current directors of Solid is expected to continue as a director of Solid after the effective time of the Acquisition. Further, as of and subject to the closing of the Acquisition, Adam Koppel, Managing Director of Bain Capital Life Sciences, will join the board of directors of Post-Closing Solid.

For a discussion of the indemnification provisions related to Solid’s directors and officers under the Merger Agreement, please see the section titled “The Merger Agreement—Indemnification for Directors and Officers” beginning on page 116 of this proxy statement.

Solid compensates its non-employee directors for their service on Solid’s Board of Directors pursuant to its non-employee director compensation program. Solid does not currently pay any compensation to Mr. Ganot, its President and Chief Executive Officer, in connection with his service on Solid’s Board of Directors. For a description of the non-employee director compensation program, please see the section titled “Executive Compensation of Solid—Non-Employee Director Compensation of Solid” beginning on page 190 of this proxy statement.

In addition to the current members of Solid’s Board who are all expected to continue to serve on the Board following the closing of Acquisition, Mr. Ganot, who will continue to serve on Solid’s Board of Directors but in a non-employee director capacity, and Dr. Koppel, Managing Director of Bain Capital Life Sciences, who is expected to join Solid’s Board of Directors upon the closing of the Acquisition, will be eligible to be compensated as a non-employee director pursuant to Solid’s non-employee director compensation program.

On September 30, 2022, Solid entered into the First Amendment to the Executive Chair Agreement with Mr. Smith (the “Amendment to the Executive Chair Agreement”). As consideration for Mr. Smith’s continued services as executive chairman of Solid’s Board from and after January 1, 2023, Solid shall, subject to approval of Solid’s Board, grant to Mr. Smith equity awards (the “2023 Awards”) with an aggregate total Black Scholes value of $700,000, consisting of (i) 50% stock options at an exercise price per share equal to the closing price of Solid’s common stock on January 2, 2023 (the “2023 Grant Date”) and (ii) 50% restricted stock units. The 2023 Awards will vest in equal quarterly installments with the first installment vesting three months from the 2023 Grant Date and the final installment vesting date on the date that is 12 months from the 2023 Grant Date, subject to Mr. Smith’s continued services as a director of Solid. In the event of (i) the early termination of the Amendment to the Executive Chair Agreement prior to the expiration of its term on December 31, 2023 and/or (ii) a “change in control” of Solid and on terms consistent with board of director equity award agreements, all unvested 2023 Awards will accelerate and vest in full.

Carl Morris, Chief Scientific Officer of Solid, is expected to serve as Chief Scientific Officer, Neuromuscular, of Solid, after the closing of the Acquisition. Stephen DiPalma, interim Chief Financial Officer and Treasurer of Solid, is expected to continue to serve in such position, after the closing of Acquisition.

Ilan Ganot intends to resign as Solid’s Chief Executive Officer and President, subject to, and contingent and effective upon, the closing of the Acquisition. Following the resignation, Mr. Ganot will continue to serve on the Board of Solid.

On September 29, 2022, Solid entered into an Executive Transition and Separation Agreement with Ilan Ganot (the “Ganot Transition Agreement”), which will be subject to, and contingent and effective upon, the closing of the Acquisition (such date, the “Separation Date”). Pursuant to the Ganot Transition Agreement, Mr. Ganot will be entitled to receive all unpaid base salary earned through the Separation Date, any amounts for accrued unused paid time off to which he is entitled through such date in accordance with Solid’s policy, and reimbursement of any properly incurred unreimbursed business expenses incurred through such date. In addition, Mr. Ganot will be entitled

to (1) continued payment of his base salary, in accordance with Solid’s regular payroll procedures, for a period of 18 months, (2) provided he is eligible for and timely elects to continue receiving group medical insurance under COBRA and the payments would not result in the violation of nondiscrimination requirements of applicable law, payment by Solid of the portion of health coverage premiums Solid pays for similarly-situated, active employees who receive the same type of coverage, for a period of up to 18 months following the Separation Date, and (3) $477,427, less applicable taxes and withholdings, which is a lump sum payment equal to 150% of his target bonus for 2022. In the event that the Separation Date occurs in 2023, Solid shall also provide Mr. Ganot with a pro-rated bonus for 2023, calculated by multiplying his target bonus by a fraction, the numerator of which is the number of days Mr. Ganot was employed by Solid in 2023 and denominator of which is 365, less applicable taxes and withholding. Mr. Ganot’s outstanding equity awards will continue to vest and be exercisable in accordance with the terms of the applicable equity award agreement and the equity plan under which such award was granted.

The Ganot Transition Agreement also provides for, among other things, a release of claims by Mr. Ganot, non-disclosure and non-disparagement obligations applicable to Mr. Ganot and non-disparagement obligations applicable to Solid. In addition, the Ganot Transition Agreement provides that the confidentiality, assignment of inventions, non-competition and non-solicitation provisions of the Employment Agreement, dated as of January 25, 2019, between Solid and Mr. Ganot remain in effect in accordance with their terms.

On September 29, 2022, Solid and Mr. Ganot also entered into a Consulting Agreement (the “Ganot Consulting Agreement”), to be effective as of the Separation Date, pursuant to which Mr. Ganot will assist with the transition of his duties to Mr. Cumbo and provide other consulting and advisory services, as requested from time to time by Solid. Mr. Ganot shall devote up to 415 hours (up to 8 hours weekly) over 12 months following the Separation Date. Mr. Ganot will be compensated at a rate of $20,833 per month for his services under the Ganot Consulting Agreement. In addition, in respect of his services as a consultant, Solid anticipates granting, subject to Board approval, Mr. Ganot an option to purchase 13,333 shares of Solid’s Common Stock (the “Ganot Stock Options”) and 6,333 restricted stock units with respect to Solid’s Common Stock (the “Ganot RSUs”). The Ganot Stock Options and the Ganot RSUs will vest in equal quarterly installments with the first installment vesting three months from the date of grant and the final installment vesting date being the date that is 12 months from the Separation Date, subject to Mr. Ganot’s continued provision of services under the Ganot Consulting Agreement. In addition, in the event of a change in control (as defined in the Ganot Consulting Agreement), the unvested Ganot Stock Options and Ganot RSUs will accelerate in full. The term of the Ganot Consulting Agreement will continue for 12 months following the Separation Date. Either party will be able to terminate the Ganot Consulting Agreement, for any or no reason, upon at least 10 days prior notice, and Solid may terminate for cause (as defined therein) immediately upon notice; provided that if Solid terminates the Ganot Consulting Agreement without cause and Mr. Ganot executes a release of claims in a form provided by Solid, then (i) the monthly consulting fees will continue to be paid to Mr. Ganot for the remainder of the term of the Ganot Consulting Agreement, (ii) the vesting of the Ganot Stock Options will accelerate in full as of the date of the termination and (iii) the Ganot RSUs will continue to settle in accordance with the vesting schedule notwithstanding Mr. Ganot’s cessation of service.

Erin Powers Brennan intends to resign as Solid’s Chief Legal Officer and Secretary, subject to, and contingent and effective upon, the closing of the Acquisition.

On September 29, 2022, Solid entered into an Executive Transition and Separation Agreement with Erin Powers Brennan (the “Brennan Transition Agreement”), which will be subject to, and contingent and effective upon, the Separation Date. Pursuant to the Brennan Transition Agreement, Ms. Brennan will be entitled to receive all unpaid base salary earned through the Separation Date, any amounts for accrued unused paid time off to which she is entitled through such date in accordance with Solid’s policy, and reimbursement of any properly incurred unreimbursed business expenses incurred through such date. In addition, Ms. Brennan will be entitled to (1) continued payment of her base salary, in accordance with Solid’s regular payroll procedures, for a period of 12 months, (2) provided she is eligible for and timely elects to continue receiving group medical insurance under COBRA and the payments would not result in the violation of nondiscrimination requirements of applicable law, payment by Solid of the portion of health coverage premiums Solid pays for similarly-situated, active employees who receive the same type of coverage, for a period of up to 12 months following the Separation Date, and (3) $172,200, which is a lump sum payment equal to 100% of her target bonus for 2022, as well as an additional $66,106 payment, which represents the retention bonus Ms. Brennan would have received on May 1, 2023 pursuant to the April 28, 2022 Retention Bonus Opportunity letter had she remained employed by Solid on that date, both amounts less applicable taxes and withholdings. In the event

that the Separation Date occurs in 2023, Solid shall also provide Ms. Brennan with a pro-rated bonus for 2023, calculated by multiplying her target bonus by a fraction, the numerator of which is the number of days Ms. Brennan was employed by Solid in 2023 and denominator of which is 365, less applicable taxes and withholdings. Ms. Brennan’s outstanding restricted stock units will vest in full as of the Separation Date, and her outstanding option awards will continue to vest and be exercisable in accordance with the terms of the applicable option award agreement and the equity plan under which such award was granted.

The Brennan Transition Agreement also provides for, among other things, a release of claims by Ms. Brennan, non-disclosure and non-disparagement obligations applicable to Ms. Brennan and non-disparagement obligations applicable to Solid. In addition, the Brennan Transition Agreement provides that the confidentiality, assignment of inventions, non-competition and non-solicitation provisions of the Employment Agreement, dated as of March 1, 2021, between Solid and Ms. Brennan remain in effect in accordance with their terms.

On September 29, 2022, Solid and Ms. Brennan also entered into a Consulting Agreement (the “Brennan Consulting Agreement”), to be effective as of the Separation Date, pursuant to which Ms. Brennan will assist with the transition of her duties and provide other consulting and advisory services, as requested from time to time by Solid. Ms. Brennan will provide up to eight (8) hours of services weekly over the first six (6) months of the term of the agreement and shall provide services on an ad hoc basis for the remainder of the term (but shall at no time provide more than eight (8) hours of services per week). Ms. Brennan will be compensated at a rate of $400 per hour for her services under the Brennan Consulting Agreement. The term of the Consulting Agreement will continue for nine months following the Separation Date. Either party will be able to terminate the Brennan Consulting Agreement at any time, for any or no reason, upon at least 10 days prior notice, and Solid may terminate for cause (as defined therein) immediately upon notice; provided that if Solid terminates the Brennan Consulting Agreement without cause and Ms. Brennan executes a release of claims in a form provided by Solid, then any unvested options that were outstanding as of the Separation Date shall become vested in full as of the termination.

The Merger Agreement provides that all of AavantiBio’s equity-based awards that are outstanding immediately prior to the effective time of the Acquisition (including all stock options and restricted stock awards), whether or not then vested or exercisable, will be cancelled for no consideration.

The Merger Agreement provides that Solid will take all actions necessary to pay to each employee of AavantiBio who will become an employee of Post-Closing Solid upon the closing of the Acquisition (to the extent their employment has not terminated by January 1, 2023) 100% of their 2022 target annual cash bonus to the extent not already paid by AavantiBio in connection with the closing of the Acquisition.

The following summarizes the Employment Agreements AavantiBio currently has in place with its executive officers, which employment agreements for continuing employees will be superseded, following the closing of the Acquisition, with the agreements described below under “Positions with Post-Closing Solid and New Employment Agreements and Severance Agreements”.

AavantiBio has entered into an employment agreement with each of its executive officers that provide for certain benefits upon a termination of employment. For Mr. Cumbo, AavantiBio’s current Chief Executive Officer and President, if his employment is terminated by AavantiBio other than due to “cause,” or if he terminates his employment for “good reason”, AavantiBio will pay Mr. Cumbo (i) his base salary for 12 months following his date of termination, (ii) 12 months of his target annual bonus for the year of termination, (iii) the full COBRA premiums for continued insurance coverage for up to 12 months and (iv) the shares subject to all outstanding time-vested equity grants will immediately vest upon his termination as if his employment had continued for a period of 6 months after his termination date, subject to execution of a release of claims in favor of AavantiBio. Mr. Cumbo is also entitled to an excise tax gross-up, which would require AavantiBio to pay him an amount equal to either 100% (if AavantiBio remained a privately owned corporation) or 50% (if AavantiBio had become a publicly-traded company) of the excise tax imposed in connection with his receipt of any “parachute payments” as defined under Internal Revenue Code Section 280G and the applicable regulations promulgated thereunder.

For Douglas Swirsky, AavantiBio’s current Chief Financial Officer, Ty Howton, AavantiBio’s current Chief Operating Officer and Christopher Wright, AavantiBio’s current Chief Medical Officer, if their employment is terminated by AavantiBio other than due to “cause,” or if they terminate employment for “good reason”, AavantiBio will pay to each of Messrs. Swirsky, Howton, and Wright, as applicable, (i) his base salary for 6 months following his date of termination or, in the event he is terminated within 3 months prior to or 12 months following “a change in control”, 9 months following his date of termination, (ii) 6 or 9 months, as applicable, of his annual target bonus for the year of termination (for Mr. Swirsky and Mr. Wright, his annual target bonus for the year of termination for 6 months following his date of termination or, in the event he is terminated within 3 months prior to or 12 months following “a change in control”, 12 months following his date of termination), (iii) the full COBRA premiums for continued insurance coverage for up to 6 or 9 months, as applicable, and (iv) the shares subject to all outstanding time-vested equity grants will immediately vest upon his termination as if his employment had continued for a period of 6 months after his termination date, subject to execution of a release of claims in favor of AavantiBio. The Board of Directors of AavantiBio has also approved, and AavantiBio will enter into, amendments to Mr. Swirsky and Mr. Wright’s employment agreements to provide them with an additional 3 months of annual target bonus in the event of termination following a “change of control.”

For Dr. Hanrahan, AavantiBio’s current Chief Regulatory Officer, if her employment is terminated by AavantiBio other than due to “cause,” or if she terminates her employment for “good reason”, AavantiBio will pay to Dr. Hanrahan (i) her base salary for 6 months following her date of termination, or, in the event she is terminated within 3 months prior to or 12 months following “a change in control”, her base salary for 9 months following her date of termination, (ii) 6 or 9 months, as applicable, of her annual target bonus for the year of termination, (iii) the full COBRA premiums for continued insurance coverage for up to 6 or 9 months, as applicable, and (iv) the shares subject to all outstanding time-vested equity grants will immediately vest upon her termination as if her employment had continued for a period of 6 months after her termination date, subject to execution of a release of claims in favor of AavantiBio.

For Mr. Herzich, AavantiBio’s current Chief Technology Officer, if his employment is terminated by AavantiBio other than due to “cause,” or if he terminates his employment for “good reason”, AavantiBio will pay to Mr. Herzich (i) his base salary for 6 months following his date of termination, or, in the event he is terminated within 3 months prior to or 12 months following “a change in control”, his base salary for 9 months following his date of termination, (ii) 6 or 9 months, as applicable, of his annual target bonus for the year of termination, (iii) the full COBRA premiums for continued insurance coverage for up to 6 or 9 months, as applicable, and (iv) in the event he is terminated within 3 months prior to or 12 months following “a change in control”, the shares subject to all outstanding equity grants will immediately vest upon his termination of employment.

For Dr. Marlowe, AavantiBio’s current Chief Scientific Officer, if her employment is terminated by AavantiBio other than due to “cause,” or if she terminates her employment for “good reason”, AavantiBio will pay to Dr. Marlowe (i) her base salary for 12 months following her date of termination, (ii) 12 months of her target annual bonus for the year of termination, (iii) the full COBRA premiums for continued insurance coverage for up to 12 months, and (iv) 25% of the shares subject to all outstanding equity grants will immediately vest as of immediately prior to her termination of employment, subject to execution of a release of claims in favor of AavantiBio.

“Cause”, “good reason” and “change in control” have the meaning set forth in each executive officer’s individual employment agreement.

Severance payments under these agreements are subject to the executive officers’ compliance with non-solicitation obligations in favor of AavantiBio for a period of one year following a termination of employment.

In connection with the closing of the Acquisition, Solid has entered into employment agreements with each of Jessie Hanrahan, Ph.D., AavantiBio’s current Chief Regulatory Officer, Mr. Herzich, Mr. Cumbo, Mr. Howton and Dr. Marlowe providing for continued employment by Post-Closing Solid after the closing of the Acquisition. For a description of the positions each such officer will hold in Post-Closing Solid following the closing of the Acquisition, please see the section titled “Management Following the Acquisition” beginning on page 179 of this proxy statement.

Among other changes, the new employment agreements provide for: an increase in base salary, an increase in annual target bonus, equity grants with respect to Post-Closing Solid’s common stock and enhanced severance

entitlements. Pursuant to his new employment agreement, Mr. Cumbo will receive a base salary of $585,000, a target annual bonus of up to 55% of the then-current annual base salary and equity awards consisting of a non-qualified stock option to purchase 228,900 shares of Post-Closing Solid's common stock and 114,449 restricted stock units of Post-Closing Solid, subject in both cases to the applicable vesting schedule. Pursuant to her new employment agreement, Dr. Hanrahan will receive an annual base salary of $420,000, target annual bonus of up to 40% of the then-current annual base salary and equity awards consisting of a non-qualified stock option to purchase 94,899 shares of Post-Closing Solid's common stock and 47,449 restricted stock units of Post-Closing Solid, subject in both cases to the applicable vesting schedule. Pursuant to his new employment agreement, Mr. Herzich will receive an annual base salary of $420,000, target annual bonus of up to 40% of the then-current annual base salary and equity awards consisting of a non-qualified stock option to purchase 57,900 shares of Post-Closing Solid’s common stock and 28,955 restricted stock units of Post-Closing Solid, subject in both cases to the applicable vesting schedule. Pursuant to his new employment agreement, Mr. Howton will receive an annual base salary of $455,000, target annual bonus of up to 40% of the then-current annual base salary and equity awards consisting of a non-qualified stock option to purchase 104,410 shares of Post-Closing Solid’s common stock and 52,205 restricted stock units of Post-Closing Solid, subject in both cases to the applicable vesting schedule. Pursuant to her new employment agreement, Dr. Marlowe will receive an annual base salary of $430,500, a target annual bonus of up to 40% of the then-current annual base salary and equity awards consisting of a non-qualified stock option to purchase 95,110 shares of Post-Closing Solid’s common stock and 47,555 restricted stock units of Post-Closing Solid, subject in both cases to the applicable vesting schedule.

In addition, each of Dr. Hanrahan, Mr. Herzich, Mr. Cumbo, Mr. Howton and Dr. Marlowe are entitled to the following severance benefits: in the event the executive’s employment is terminated by Post-Closing Solid without “cause” or by the executive for “good reason” prior to or more than 12 months following a “change in control”, Post-Closing Solid will pay to the executive (A) 12 months’ base salary and (B) the full COBRA premiums for continued insurance coverage for 12 months, subject to execution of a release of claims in favor of Post-Closing Solid or in the event the executive’s employment is terminated within 12 months following a “change in control”, Post-Closing Solid will pay to the executive (A) 12 months’ base salary 18 months for Mr. Cumbo), (B) 12 months of executive’s target annual bonus for the year in which employment was terminated (or executive’s target bonus immediately prior to the change in control, if higher) 18 months for Mr. Cumbo), and (C) the full COBRA premiums for continued insurance coverage for 12 months 18 months for Mr. Cumbo), and the shares subject to all outstanding time-vested equity grants will immediately vest upon termination, subject to execution of a release of claims in favor of Post-Closing Solid.

All of the foregoing equity awards will be granted as an inducements material to each such employee’s acceptance of employment with Post-Closing Solid in accordance with Nasdaq Listing Rule 5635(c)(4).

“Cause”, “good reason” and “change in control” have the meaning set forth in each executive officer’s individual employment agreement.

In connection with the closing of the Acquisition, AavantiBio has entered into a consulting agreement with Mr. Swirsky to continue providing services to AavantiBio following the closing of the Acquisition. Pursuant to this new consulting agreement, Mr. Swirsky will be paid $12,000 per month for finance, accounting and administrative consulting services. In addition, Mr. Swirsky is also eligible to receive a lump-sum payment of $33,215 upon the closing of the Acquisition for his assistance with respect to the closing of the Acquisition and a lump-sum payment of $25,000 conditioned upon the completion of certain cash management milestones of AavantiBio. This new consulting agreement also provides for payment, from time to time or at the end of the one-year term of the agreement, equal to 5% of contract and/or lease savings achieved. Total payments under this new consulting agreement may not exceed a total of $600,000.

In connection with the Merger Agreement, AavantiBio has entered into amended consulting agreements with Barry Byrne, M.D., Ph.D. and Manuela Corti, P.T., Ph.D. to continue certain consulting services to AavantiBio after the closing of the Acquisition. Among other changes to the existing agreements, the consulting agreements with Dr. Byrne and Dr. Corti were amended to extend the terms of the consulting arrangements to December 31, 2025, amend the terms of certain restrictive covenants in the agreements to be more restrictive and to provide for amended

consulting fees to be paid over time to each of Dr. Byrne and Dr. Corti. An initial one-time payment of $200,000 will be paid to each of Dr. Byrne and Dr. Corti under the amended consulting agreements 5 days prior to the effective time of the Acquisition. The remainder of the fees pursuant to the amended consulting agreements shall be paid in $25,000 quarterly installments through December 31, 2025 (the previous agreements provided for quarterly payments of $25,000 to each of Dr. Byrne and Dr. Corti until the termination of the agreement). Dr. Byrne and Dr. Corti each hold approximately 2,500,000 shares of AavantiBio’s common stock which shares will be cancelled for no consideration pursuant to the terms of the Merger Agreement.

Dr. Byrne and Dr. Corti have substantial interests in the development and commercialization of certain of AavantiBio’s product candidates outside of their consulting agreements with and ownership interests in AavantiBio. Drs. Byrne and Corti co-founded AavantiBio and through their foundational research in Friedreich’s ataxia created inventions that are licensed to AavantiBio by third parties and that are critical to AvantiBio’s ability to develop and commercialize these product candidates. Drs. Byrne and Corti may receive additional future payments from the third party licensors and their affiliated entities relating to the commercialization and development of these product candidates, and these payments could be material to each of Dr. Byrne and Dr. Corti.

Under the Merger Agreement, Solid will acquire AavantiBio for aggregate consideration of (i) $1,000 and (ii) a number of shares of the Post-Closing Solid’s common stock, (rounded to the nearest whole share) equal to 15% of outstanding shares of Solid’s common stock as of immediately following the closing of the Acquisition (and for the avoidance of doubt, before giving effect to the issuance of any securities pursuant to the Private Placement, calculated on a fully diluted basis using the treasury stock method (including, for clarity, calculated by disregarding any out-of-the-money outstanding stock options of Solid)), subject to certain adjustments depending on the amount of certain indebtedness of AavantiBio at closing. Based on the closing price of Solid’s common stock on September 28, 2022, the aggregate value of Acquisition consideration to be received by AavantiBio stockholders is approximately $9,750,000. Pursuant to the preferential payment provisions found in the amended and restated certificate of incorporation of AavantiBio, it is anticipated that only holders of AavantiBio Series A-1 Preferred stock, $0.0001 par value per share (“Series A-1 Preferred Stock) and Series A-2 Preferred Stock, $0.0001 par value per share (“Series A-2 Preferred Stock” and, together with the Series A-1 Preferred Stock, “Preferred Stock”) will receive a portion of the Acquisition consideration, and therefore all outstanding shares of common stock of AavantiBio, as well as any outstanding stock options and other outstanding equity awards, will be cancelled and holders of such shares of AavantiBio’s common stock, stock options and equity awards will not receive consideration for their shares or equity awards. As more fully described below in the section titled “Directors and Officers of AavantiBio Receiving Acquisition Consideration”, Mr. Cumbo, the current Chief Executive Officer, President and director of AavantiBio, and Ian F. Smith, a senior advisor to Bain Capital Life Sciences LP, the current Chair of the Board of Directors of Solid and also a director of AavantiBio, will be receiving cash and shares of Post-Closing Solid’s common stock as consideration for their shares of Preferred Stock under the Merger Agreement.

Holders of approximately 77% of the fully diluted ownership of AavantiBio have signed support and joinder agreements. These same holders have consented to the Acquisition, constituting a percentage large enough to activate the drag-along rights under the under AavantiBio’s Voting Agreement, dated as of October 21, 2022 by and among AavantiBio and the signatories listed therein (the “Voting Agreement”). Under the drag-along rights in the Voting Agreement, these stockholders may cause the other stockholders vote in favor of the Acquisition and the other transactions contemplated by the Merger Agreement, and the other stockholders are contractually obligated not to object to the Acquisition or the other transactions contemplated by the Merger Agreement and such other stockholders have waived their appraisal rights with respect to the Acquisition. The stockholders who signed these support and joinder agreements and consented to the Acquisition represent the holders of a majority of issued and outstanding Preferred Stock and also Dr. Byrne and Dr. Corti, who together hold a majority of AavantiBio’s issued and outstanding common stock.

As a holder of Preferred Stock of AavantiBio, Mr. Cumbo will be receiving approximately 584 shares of Post-Closing Solid’s common stock, having a market value of approximately $4,200 based on the closing price of Solid’s common stock on September 28, 2022. Also as a holder of Preferred Stock of AavantiBio, Mr. Smith will be receiving approximately 13,171 shares of Post-Closing Solid’s common stock, having a market value of approximately $95,000 based on the closing price of Solid’s common stock on September 28, 2022.

Upon the closing of the Acquisition, Mr. Cumbo will become the Chief Executive Officer, President and a director of Post-Closing Solid. Upon the closing of the Acquisition, Mr. Smith will remain the Chair of the Board of Post-Closing Solid.

Funds affiliated with Bain Capital Life Sciences Investors, LLC (“Bain”), funds affiliated with RA Capital Management (“RA Capital”) and funds affiliated with Perceptive Life Sciences Master Fund LTD (“Perceptive”) are principal stockholders of both AavantiBio and of Solid. For information about Bain’s, RA Capital’s and Perceptive’s ownership in Solid, see the section titled “Principal Stockholders of Solid” beginning on page 193 of this proxy statement.

Bain, Perceptive and RA Capital collectively hold shares of capital stock of AavantiBio representing approximately 75% of the outstanding voting power, and will receive approximately 95% of the aggregate consideration in the Acquisition payable to AavantiBio stockholders. As holders of Preferred Stock of AavantiBio, certain funds affiliated with Bain will be receiving approximately 438,593 shares of Post-Closing Solid’s common stock in connection with the Acquisition, having a market value of approximately $3,200,000 based on the closing price of Solid’s common stock on September 28, 2022. As holders of Preferred Stock, certain funds affiliated with Perceptive will be receiving approximately 438,594 shares of Post-Closing Solid’s common stock in connection with the Acquisition, having a market value of approximately $3,200,000 based on the closing price of Solid’s common stock on September 28, 2022. As holders of Preferred Stock, certain funds affiliated with RA Capital will be receiving approximately 410,027 shares of Post-Closing Solid’s common stock in connection with the Acquisition, having a market value of approximately $3,000,000 based on the closing price of Solid’s common stock on September 28, 2022.

Solid has also entered into a Securities Purchase Agreement with funds associated with Bain, RA Capital and Perceptive, among other accredited investors, pursuant to which Solid agreed to issue and sell to such investors in the Private Placement an aggregate of 10,638,290 shares of the Post-Closing Solid’s common stock, at a price of $7.05 per share. The Private Placement is expected to close immediately following the closing of the Acquisition. For more information about the Private Placement, the Securities Purchase Agreement and the purchasers in the Private Placement, see the sections entitled “Agreements Related to the Acquisition and the Private Placement—Securities Purchase Agreement and Registration Rights Agreement” beginning on page 123 of this proxy statement and “The Acquisition—Interests of Solid’s Directors and Executive Officers in the Acquisition” beginning on page 98 of this proxy statement.

Certain members of the board of directors of both AavantiBio and Solid are affiliated with Bain, Perceptive and RA Capital. On AavantiBio’s Board of Directors, Benjamin Lund is a principal at Bain, Ellen Hukkelhoven is a senior biotechnology analyst at Perceptive and Jake Simson is a partner at RA Capital. On Solid’s Board of Directors, Mr. Smith is a senior advisor to Bain, Adam Stone is the chief investment officer of Perceptive and Rajeev Shah is a portfolio manager and managing director at RA Capital. Mr. Lund, Dr. Hukkelhoven and Dr. Simson will not serve on the Post-Closing Solid Board of Directors. Mr. Smith, Mr. Stone and Mr. Shah will continue to serve on the Post-Closing Solid Board of Directors following the Acquisition and, Adam Koppel, Managing Director at Bain Capital Life Sciences, will also join the Post-Closing Solid Board of Directors upon the closing of the Acquisition.

In addition to the indemnification obligations required by the certificate of incorporation and the bylaws of Solid, Solid has entered into or will enter into indemnification agreements with each of its directors and officers. Under the terms of Solid’s indemnification agreements, Solid is required to indemnify each of its directors and officers, to the fullest extent permitted by the laws of the State of Delaware, if the basis of the indemnitee’s involvement was by reason of the fact that the indemnitee is or was a director, or officer, of Solid or any of its subsidiaries or was serving at Solid’s request in an official capacity for another entity. Solid is required to indemnify its officers and directors against (1) attorneys’ fees and (2) all other costs of any type or nature whatsoever, including any and all expenses and obligations paid or incurred in connection with investigating, defending, being a witness in, participating in (including on appeal) or preparing to defend, be a witness or participate in any completed, actual, pending or threatened action, suit, claim or proceeding, whether civil, criminal, administrative or investigative, or establishing or enforcing a right to

indemnification under the indemnification agreement. The indemnification agreements also set forth certain procedures that will apply in the event of a claim for indemnification thereunder. These indemnification provisions and the indemnification agreements may be sufficiently broad to permit indemnification of Solid’s officers and directors for liabilities, including reimbursement of expenses incurred, arising under the Securities Act. Solid believes that provisions in the certificate of incorporation and bylaws and indemnification agreements are necessary to attract and retain qualified persons as directors and officers. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the applicable company pursuant to the foregoing provisions, Sol