Part I [Business](index=7&type=section&id=Item%201.%20Business) Gain Therapeutics is a preclinical biotech developing novel **STARs** for protein misfolding diseases via its **SEE-Tx® platform**, with lead programs in **Parkinson's** and **Gaucher disease** [Overview](index=7&type=section&id=Overview) Gain Therapeutics uses its **SEE-Tx® platform** to discover **STARs** for **LSDs** and **CNS** disorders, with lead programs for **Parkinson's** and **Gaucher disease** in preclinical development - The company uses its **Site-Directed Enzyme Enhancement Therapy (SEE-Tx®) platform** to discover novel allosteric binding sites on proteins and identify proprietary small molecules (**STARs**) to treat diseases like **LSDs** and **CNS** disorders[14](index=14&type=chunk) - Lead compounds for **Parkinson's disease** and **Gaucher disease** are in preclinical studies, with **positive in vitro data** showing **increased GCase protein levels** and **reduction of toxic substrates**[16](index=16&type=chunk) - The company plans to submit a **regulatory dossier** to initiate a **first-in-human Phase 1 clinical trial** for its **Parkinson's disease** program in the **second half of 2022**[17](index=17&type=chunk) - Completed its **Initial Public Offering (IPO)** on **March 17, 2021**, raising net proceeds of **approximately $40.5 million**[19](index=19&type=chunk)[20](index=20&type=chunk) [Our Platform for Computational Target and Drug Discovery](index=9&type=section&id=Our%20Platform%20for%20Computational%20Target%20and%20Drug%20Discovery) The **SEE-Tx® platform** discovers novel allosteric binding sites, identifying **STARs** to modulate protein function with high specificity and a **14%** validated compound hit rate - The **SEE-Tx® platform** uses **computational methods** to identify novel **allosteric binding sites** on proteins, which are distinct from the active site[22](index=22&type=chunk)[23](index=23&type=chunk) - Targeting **allosteric sites** allows for **improved specificity** and **multiple mechanisms of action**, including **protein stabilization**, **destabilization**, and **targeted degradation**[25](index=25&type=chunk)[29](index=29&type=chunk) - The platform's **validated-target approach** is **faster and more efficient** than traditional **high-throughput screening**, with an **average hit rate** for **validated compounds** of **14%**, a significant improvement over traditional methods[28](index=28&type=chunk) [Our Pipeline of STARs](index=15&type=section&id=Our%20Pipeline%20of%20STARs) The company's **STARs** pipeline targets **LSDs**, **CNS** disorders, metabolic diseases, and oncology, with lead preclinical programs **GT-02287** for **Parkinson's** and **GT-02329** for **Gaucher Disease** - The pipeline is built on the **SEE-Tx® platform** and is **disease-agnostic**, with an **initial focus** on **LSDs** and **CNS disorders**[37](index=37&type=chunk) - The lead compound for **Parkinson's Disease**, **GT-02287**, has demonstrated the ability to **increase GCase activity**, **improve lysosomal delivery**, and reduce toxic **alpha-synuclein** in preclinical models, showing **high brain exposure** with a **brain-to-plasma ratio greater than one**[48](index=48&type=chunk)[50](index=50&type=chunk)[55](index=55&type=chunk) - The lead compound for **Gaucher Disease**, **GT-02329**, has been shown to **increase GCase levels**, reduce toxic **glucosylsphingosine**, and **enhance GCase activity** in the brain and plasma in preclinical studies[63](index=63&type=chunk)[66](index=66&type=chunk)[68](index=68&type=chunk) - **Research-stage programs** are targeting enzymes related to **GM1 Gangliosidosis (GLB)**, **MPS1 (IDUA)**, **Krabbe Disease (GALC)**, and **Metachromatic Leukodystrophy (MLD)**[69](index=69&type=chunk)[70](index=70&type=chunk)[77](index=77&type=chunk)[87](index=87&type=chunk)[95](index=95&type=chunk) [Competition](index=35&type=section&id=Competition) The company faces intense competition from gene therapy developers and other firms like **Axovant**, **Lysogene**, **Prevail**, and **Apollo**, many with superior resources - The company faces **competition** from firms developing **gene therapy approaches** and other treatments for its target indications, including **Axovant**, **Lysogene**, **Prevail Therapeutics**, and **Apollo Therapeutics**[108](index=108&type=chunk) - Many competitors have **greater financial, R&D, and manufacturing resources**, which could allow them to establish a **strong market position** before Gain Therapeutics can enter the market[109](index=109&type=chunk) [Strategic Transactions; Collaboration and Licensing Arrangements](index=35&type=section&id=Strategic%20Transactions%3B%20Collaboration%20and%20Licensing%20Arrangements) The company's strategy includes collaborations and licensing, notably an **exclusive SEE-Tx® platform** license from **Minoryx** and a multi-target oncology collaboration with **Zentalis Pharmaceuticals** - The company has an **exclusive, worldwide license** from **Minoryx Therapeutics, S.L.** to use the **SEE-Tx® discovery platform**, which requires **royalty payments** on net revenues and a **1.25% milestone payment** on any consideration received from a **sale of the company**[117](index=117&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk) - In **April 2021**, entered into a **multi-target collaboration** with **Zentalis Pharmaceuticals** to discover new **cancer treatments**, with the agreement including initiation fees, **R&D cost reimbursement**, and potential **milestone payments up to $41.5 million** plus **royalties**[112](index=112&type=chunk)[116](index=116&type=chunk) - A strategic research collaboration with **Sumitomo Dainippon Pharma** was **terminated**, with a formal notice expected after **March 22, 2022**[111](index=111&type=chunk) [Intellectual Property](index=39&type=section&id=Intellectual%20Property) The company protects its technology through patents and trade secrets, with **five pending European patent applications** and key in-licensed patents for **SEE-Tx®** (**expiring 2032**) and **GLB/GBA** programs (**expiring 2037**) - The company's **patent portfolio** consists of **five pending European patent applications** and related **national stage applications** as of **February 2022**[122](index=122&type=chunk) - Key **in-licensed patents** include one for the **SEE-Tx® Technology** (**expiring 2032**) and patent families for the **GLB** and **GBA programs** (applications, if issued, **expiring 2037**)[122](index=122&type=chunk)[123](index=123&type=chunk)[124](index=124&type=chunk) - The company also relies on **trade secrets**, **know-how**, and **confidentiality agreements** with **employees and collaborators** to protect its **proprietary information**[126](index=126&type=chunk) [Government Regulation](index=41&type=section&id=Government%20Regulation) The company's products face extensive **FDA** regulation, involving lengthy preclinical and clinical trials, with potential for **Orphan Drug Designation** and ongoing compliance with **cGMP**, **ACA**, and anti-fraud laws - The **FDA drug approval process** involves extensive **preclinical studies**, an **IND submission**, and typically **three phases of clinical trials (Phase I, II, III)** to establish **safety and efficacy**[132](index=132&type=chunk)[138](index=138&type=chunk)[139](index=139&type=chunk)[140](index=140&type=chunk) - The company may seek **Orphan Drug Designation**, which is for diseases affecting **fewer than 200,000 individuals** in the U.S. and provides a **seven-year period of marketing exclusivity** if the product is the first approved for that indication[154](index=154&type=chunk)[155](index=155&type=chunk) - The company is subject to **healthcare laws** such as the **Affordable Care Act (ACA)**, which impacts **drug pricing and reimbursement**, and federal/state **anti-kickback** and **false claims laws**[172](index=172&type=chunk)[179](index=179&type=chunk)[181](index=181&type=chunk) - Marketing products outside the U.S., particularly in the **European Economic Area (EEA)**, requires authorization through centralized or national procedures and compliance with regulations like the **GDPR for data privacy**[190](index=190&type=chunk)[191](index=191&type=chunk)[201](index=201&type=chunk) [Employees and Human Capital Resources](index=65&type=section&id=Employees%20and%20Human%20Capital%20Resources) As of **December 31, 2021**, the company had **29 employees** (**20** in **R&D**) across **Barcelona**, **Lugano**, and **Bethesda** - As of **December 31, 2021**, the company had **29 employees**, with **20 in R&D** and **9 in general and administrative roles**[206](index=206&type=chunk) - Employees are located in **Barcelona, Spain (12)**, **Lugano, Switzerland (14)**, and **Bethesda, Maryland (3)**[206](index=206&type=chunk) [Risk Factors](index=67&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks including **operating losses**, need for **additional capital**, uncertain clinical trial outcomes, **SEE-Tx® platform** novelty, **Minoryx** license dependency, competition, and regulatory complexities - The company has a history of **operating losses** and expects to incur losses for the foreseeable future, with no guarantee of achieving profitability[213](index=213&type=chunk) - The company's success is highly dependent on its ability to raise **additional capital**; failure to do so could force delays or termination of development programs[221](index=221&type=chunk)[274](index=274&type=chunk) - The company's product candidates are novel and in early development, with success in **preclinical studies** not being indicative of future **clinical trial results**, and **clinical trials** are expensive, time-consuming, and have an uncertain outcome[231](index=231&type=chunk)[236](index=236&type=chunk)[242](index=242&type=chunk) - The business is significantly dependent on an **exclusive license** from **Minoryx Therapeutics** for its core **SEE-Tx® platform**; termination of this license would have a **material adverse effect** on operations[290](index=290&type=chunk)[291](index=291&type=chunk) - The ongoing **COVID-19 pandemic** and **global instability**, such as the conflict in **Ukraine**, could adversely affect operations, disrupt supply chains, and impact the ability to access capital[280](index=280&type=chunk)[344](index=344&type=chunk) - The company has identified and is remediating **material weaknesses** in its **internal control over financial reporting**, which could affect the accuracy and timeliness of its **financial statements**[341](index=341&type=chunk)[342](index=342&type=chunk)[343](index=343&type=chunk) [Unresolved Staff Comments](index=125&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the **Securities and Exchange Commission** - None[395](index=395&type=chunk) [Properties](index=125&type=section&id=Item%202.%20Properties) The company leases facilities in **Bethesda**, **Lugano**, and **Barcelona** for its operations, with potential future expansion needs - Leases **1,568 sq ft** of **office space** in **Bethesda, Maryland** (**lease expires Sept 2024**)[396](index=396&type=chunk) - Leases **2,992 sq ft** of **office space** in **Lugano, Switzerland** (**lease expires May 2026**)[397](index=397&type=chunk) - Leases a total of **2,819 sq ft** of lab and **office space** in **Barcelona, Spain** across two agreements (**leases expire Dec 2025** and **Nov 2026**)[397](index=397&type=chunk)[398](index=398&type=chunk) [Legal Proceedings](index=126&type=section&id=Item%203.%20Legal%20Proceedings) The company is not currently involved in any **legal proceedings** - None[399](index=399&type=chunk) [Mine Safety Disclosures](index=126&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is **not applicable** to the company's business - Not applicable[400](index=400&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=127&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's **common stock** trades on **Nasdaq** under **GANX**, with **54 holders** as of **February 28, 2022**, and no plans for **dividends** - **Common Stock** trades on the **Nasdaq Global Market** under the symbol "**GANX**"[402](index=402&type=chunk) - As of **February 28, 2022**, there were **approximately 54 holders of record**[402](index=402&type=chunk) - The company has no intention to declare or pay a **dividend** in the foreseeable future[403](index=403&type=chunk) [Selected Financial Data](index=127&type=section&id=Item%206.%20Selected%20Financial%20Data) This section has been **reserved** and contains no information - Reserved[404](index=404&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=127&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) For **2021**, the company reported a **net loss of $13.9 million**, driven by increased **R&D** and **G&A** expenses, with **$36.9 million** in cash as of **December 31, 2021**, expected to fund operations into **H2 2023** | Financial Metric | 2021 | 2020 | | :--- | :--- | :--- | | **Total Revenues** | **$164,994** | **$28,881** | | **Research and Development Expenses** | **$7,164,229** | **$2,259,204** | | **General and Administrative Expenses** | **$6,826,938** | **$1,249,126** | | **Loss from Operations** | **$(13,826,173)** | **$(3,479,449)** | | **Net Loss** | **$(13,890,606)** | **$(3,577,682)** | | **Net Loss Per Share** | **$(1.37)** | **$(1.33)** | - The increase in **R&D expenses** was primarily due to expanded research activities, including external collaborations for chemical synthesis and toxicology studies, and higher personnel costs[436](index=436&type=chunk) - The increase in **G&A expenses** was driven by costs associated with being a public company, including legal, accounting, and investor relations fees, as well as increased personnel and stock-based compensation costs[438](index=438&type=chunk) - As of **December 31, 2021**, the company had **cash and cash equivalents of $36.9 million** and an **accumulated deficit of $20.9 million**[412](index=412&type=chunk)[440](index=440&type=chunk) - The company believes its existing cash, including **IPO proceeds**, will fund **operating expenses** and **capital requirements** into the **second half of 2023**[454](index=454&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=145&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company faces **interest rate** and **foreign currency risk**, with minimal **interest rate risk** and **foreign currency risk** from **CHF** and **EUR** operations, where a **10% USD-CHF** change would impact **2021 net loss** by **$587,000** - Primary market risk exposures are **interest rate sensitivity** and **foreign currency exchange risk**[471](index=471&type=chunk)[473](index=473&type=chunk) - **Interest rate risk is minimal** due to the **short-term nature of cash equivalents** and **zero-interest debt**[471](index=471&type=chunk)[472](index=472&type=chunk) - **Foreign currency risk exists** due to **operations in Switzerland (CHF) and Spain (EUR)**, where a **hypothetical 10% change** in the **USD-CHF exchange rate** would have changed the **2021 net loss by approximately $587,000**[473](index=473&type=chunk) [Financial Statements and Supplementary Data](index=147&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's **audited consolidated financial statements** for **2021** and **2020**, including **balance sheets**, **statements of operations**, and **cash flows**, with **total assets of $39.0 million** and **total liabilities of $4.2 million** as of **December 31, 2021** | Balance Sheet Item | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | **Total Current Assets** | **$37,722,044** | **$8,987,828** | | **Total Assets** | **$38,985,071** | **$9,604,358** | | **Total Current Liabilities** | **$2,552,546** | **$2,114,831** | | **Total Liabilities** | **$4,167,525** | **$3,402,369** | | **Total Stockholders' Equity** | **$34,817,546** | **$6,201,989** | | Cash Flow Item | Year Ended Dec 31, 2021 | Year Ended Dec 31, 2020 | | :--- | :--- | :--- | | **Cash used in operating activities** | **$(12,365,670)** | **$(3,240,237)** | | **Cash used in investing activities** | **$(94,212)** | **$(20,826)** | | **Cash provided by financing activities** | **$41,766,775** | **$10,486,961** | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=195&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes or disagreements with its accountants regarding **accounting and financial disclosure** - None[634](index=634&type=chunk) [Controls and Procedures](index=195&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded **disclosure controls** were ineffective as of **December 31, 2021**, due to an unremediated **material weakness** in procedures for **timely financial statement preparation**, though personnel issues were **remediated** - Management concluded that **disclosure controls and procedures were not effective** as of **December 31, 2021**, due to a **material weakness** in **internal control over financial reporting**[635](index=635&type=chunk) - Of the two **material weaknesses** identified in **2020**, the one related to a lack of sufficient **accounting and supervisory personnel** was **remediated** as of **December 31, 2021**[638](index=638&type=chunk)[640](index=640&type=chunk) - The **material weakness** related to a lack of **adequate procedures and controls** to ensure accurate and **timely financial statement preparation remains unremediated**[638](index=638&type=chunk)[640](index=640&type=chunk) [Other information](index=197&type=section&id=Item%209B.%20Other%20information) **Not applicable** - Not applicable[643](index=643&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=198&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance will be in the **2022 Proxy Statement**, filed within **120 days** of **December 31, 2021**, with a **code of ethics** available online - Information is incorporated by reference to the company's **Proxy Statement** for the **2022 annual meeting of stockholders**[646](index=646&type=chunk) - The company has a **code of ethics** posted on its website[647](index=647&type=chunk) [Executive Compensation](index=198&type=section&id=Item%2011.%20Executive%20Compensation) Information on **executive compensation** is incorporated by reference from the **2022 Proxy Statement**, to be filed within **120 days** of fiscal year-end - Information is incorporated by reference to the company's **Proxy Statement** for the **2022 annual meeting of stockholders**[649](index=649&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=198&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information on **security ownership** is incorporated by reference from the **2022 Proxy Statement**, to be filed within **120 days** of fiscal year-end - Information is incorporated by reference to the company's **Proxy Statement** for the **2022 annual meeting of stockholders**[650](index=650&type=chunk) [Certain Relationships and Related Transactions and Director Independence](index=198&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%20and%20Director%20Independence) Information on **related party transactions** and **director independence** is incorporated by reference from the **2022 Proxy Statement**, to be filed within **120 days** of fiscal year-end - Information is incorporated by reference to the company's **Proxy Statement** for the **2022 annual meeting of stockholders**[651](index=651&type=chunk) [Principal Accountant Fees and Services](index=198&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information on **principal accountant fees and services** is incorporated by reference from the **2022 Proxy Statement**, to be filed within **120 days** of fiscal year-end - Information is incorporated by reference to the company's **Proxy Statement** for the **2022 annual meeting of stockholders**[652](index=652&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=199&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists **exhibits** for the **Annual Report on Form 10-K**, with **financial statements** under **Item 8**, omitted schedules, and an **exhibit list** including **organizational documents** and **material contracts** - The **financial statements** required by this item are filed under **Item 8** of this report[654](index=654&type=chunk) - All **financial statement schedules** have been omitted as they are **not applicable** or the required information is included in the **financial statements** or notes[654](index=654&type=chunk) - A **list of exhibits** filed with the report is provided, including **organizational documents**, **material contracts**, and required **certifications**[655](index=655&type=chunk) [Form 10-K Summary](index=201&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company has **not provided** a **summary** for **Form 10-K** - None[660](index=660&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40237 GAIN THERAPEUTICS, INC. (Exact name of registrant as specified in its charter) Delaware 85-1726310 ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40237 GAIN THERAPEUTICS, INC. (Exact name of registrant as specified in its charter) Delaware 85-1726310 (Stat ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Table of Contents Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40237 GAIN THERAPEUTICS, INC. Securities registered pursuant to Section 12(b) of the Act: | Title of each cla ...