Structure Therapeutics(GPCR) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION This section provides the unaudited condensed consolidated financial statements and management's discussion and analysis of the company's financial condition and results of operations Item 1. Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements, including the balance sheets, statements of operations and comprehensive loss, statements of shareholders' equity, and statements of cash flows, along with detailed notes explaining the company's financial position, performance, and significant accounting policies for the periods ended June 30, 2025, and December 31, 2024 Condensed Consolidated Balance Sheets This statement presents the company's financial position, including assets, liabilities, and equity, at specific reporting dates Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :------------------------------- | | Cash and cash equivalents | $147,024 | $169,510 | | Short-term investments | $639,472 | $714,008 | | Total current assets | $799,298 | $891,211 | | Total assets | $816,443 | $903,330 | | Total current liabilities | $39,033 | $36,021 | | Total liabilities | $44,362 | $38,487 | | Total shareholders' equity | $772,081 | $864,843 | - Total assets decreased from $903.3 million at December 31, 2024, to $816.4 million at June 30, 2025, primarily due to a reduction in cash, cash equivalents, and short-term investments[16] Condensed Consolidated Statements of Operations and Comprehensive Loss This statement details the company's revenues, expenses, and net loss over specific reporting periods, reflecting operational performance Condensed Consolidated Statements of Operations and Comprehensive Loss (in thousands) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :------------------------------------------ | :------------------------------------------ | | Research and development | $54,710 | $22,050 | $97,577 | $42,729 | | General and administrative | $15,741 | $11,266 | $29,185 | $22,602 | | Total operating expenses | $70,451 | $33,316 | $126,762 | $65,331 | | Loss from operations | $(70,451) | $(33,316) | $(126,762) | $(65,331) | | Interest and other income, net | $8,929 | $7,335 | $18,505 | $13,343 | | Net loss attributable to ordinary shareholders | $(61,661) | $(26,034) | $(108,494) | $(52,070) | | Net loss per share, basic and diluted | $(0.36) | $(0.18) | $(0.63) | $(0.36) | - Net loss attributable to ordinary shareholders significantly increased for both the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily driven by a substantial rise in research and development expenses[19] Condensed Consolidated Statements of Shareholders' Equity This statement outlines changes in the company's equity accounts, including net losses, share-based compensation, and share issuances Condensed Consolidated Statements of Shareholders' Equity (in thousands) | Metric | December 31, 2024 (in thousands) | March 31, 2025 (in thousands) | June 30, 2025 (in thousands) | | :-------------------------------- | :------------------------------- | :---------------------------- | :--------------------------- | | Total Shareholders' Equity | $864,843 | $824,638 | $772,081 | | Accumulated Deficit | $(329,098) | $(375,931) | $(437,592) | - Total shareholders' equity decreased from $864.8 million at December 31, 2024, to $772.1 million at June 30, 2025, primarily due to net losses and unrealized losses on investments, partially offset by share-based compensation and proceeds from share issuances[21] Condensed Consolidated Statements of Cash Flows This statement summarizes the cash inflows and outflows from operating, investing, and financing activities over specific periods Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash used in operating activities | $(106,787) | $(60,473) | | Net cash provided by (used in) investing activities | $82,975 | $(203,097) | | Net cash provided by financing activities | $1,326 | $515,405 | | Net change in cash and cash equivalents | $(22,486) | $251,835 | | Cash and cash equivalents, end of period | $147,024 | $381,627 | - For the six months ended June 30, 2025, net cash used in operating activities increased to $106.8 million, while investing activities provided $83.0 million, primarily from net maturities of short-term investments. Financing activities provided $1.3 million, resulting in a net decrease in cash and cash equivalents of $22.5 million[23] Notes to Unaudited Condensed Consolidated Financial Statements This section provides detailed explanations and supplementary information for the figures presented in the unaudited financial statements - The company is a clinical-stage global biopharmaceutical company incorporated in the Cayman Islands with operating subsidiaries in the United States and China, focused on developing novel oral therapeutics for chronic diseases[24] Summary of Financing Events | Financing Event | Net Proceeds (approx.) | | :---------------- | :--------------------- | | Initial Public Offering (Feb 2023) | $166.7 million | | Private Placement (Oct 2023) | $281.5 million | | Follow-On Offering (June 2024) | $512.7 million | - As of June 30, 2025, the company had $786.5 million in cash, cash equivalents, and short-term investments, which it believes will be sufficient to fund projected operations for at least 12 months[31] Research and Development and General and Administrative Expenses (in thousands) | R&D Expense Category | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Discovery research and development | $48,031 | $20,392 | | Clinical research and development | $40,306 | $17,696 | | Other research and development expenses | $9,240 | $4,641 | | General and administrative | $29,185 | $22,602 | | Total operating expenses | $126,762 | $65,331 | - A $3.0 million milestone payment was achieved and paid under the Aconcagua-Schrödinger Agreement as of June 30, 2025. Additionally, Basecamp Bio Inc. entered into an Asset Purchase Agreement with Exelixis, Inc. on August 5, 2025, for early-stage assets, with potential initial payments of $10.0 million and up to $90.0 million in contingent milestones[80][81] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides an overview of the company's clinical-stage biopharmaceutical business, its pipeline of oral small molecule therapeutics targeting GPCRs for chronic diseases, and a detailed analysis of its financial performance, liquidity, and capital resources. The company reported increased net losses driven by higher R&D expenses, particularly for aleniglipron, and discussed its funding strategy and future capital needs Overview This section introduces the company's clinical-stage biopharmaceutical business, its drug discovery platform, and its pipeline of oral small molecule therapeutics - The company is a clinical stage global biopharmaceutical company focused on developing novel oral small molecule therapeutics for chronic diseases, utilizing a differentiated technology platform that leverages structure-based drug discovery and computational chemistry against G-protein coupled receptors (GPCRs)[84] - Aleniglipron (GSBR-1290), an oral GLP-1R agonist, is the most advanced product candidate, currently in two Phase 2 clinical studies (ACCESS and ACCESS II) for obesity and overweight. Positive topline Phase 2a data showed a 6.2% placebo-adjusted mean weight decrease at 12 weeks. Enrollment for ACCESS and ACCESS II was completed in February 2025, with topline data expected in Q4 2025[85][86][89] - The pipeline also includes ACCG-2671 (oral amylin receptor agonist, IND-enabling studies ongoing, Phase 1 expected by year-end 2025), ANPA-0073 (oral APJ receptor agonist, Phase 2 ready), and LTSE-2578 (oral LPA1R antagonist for IPF, completed Phase 1 in July 2025)[85][92][95] - The company relies on third parties for manufacturing product candidates and is diversifying suppliers outside of China. It has incurred significant net operating losses ($108.5 million for six months ended June 30, 2025) and had an accumulated deficit of $437.6 million as of June 30, 2025[97][98][100] - Existing cash, cash equivalents, and short-term investments ($786.5 million as of June 30, 2025) are expected to fund operations through at least 2027, including Phase 3 readiness for aleniglipron (excluding registrational studies). Substantial additional capital will be needed for Phase 3 and future growth[101][102] Impact of Geopolitical and Macroeconomic Factors This section assesses the potential effects of global geopolitical and macroeconomic developments on the company's operations and financial outlook - While no significant financial impact was observed for the six months ended June 30, 2025, the company acknowledges potential future impacts from geopolitical and macroeconomic developments, including disruptions in access to bank deposits, tariffs, global pandemics, and US-China tensions[103][105] - The One Big Beautiful Bill Act (OBBBA), signed on July 4, 2025, repeals the requirement to capitalize domestic R&D expenditures for federal income tax purposes for taxable years beginning after December 31, 2024, and allows 100% bonus depreciation. The company preliminarily does not anticipate a material change to its effective income tax rate due to a full valuation allowance[106] Components of Our Results of Operations This section outlines the primary categories of expenses and income that constitute the company's financial performance - Research and development expenses primarily consist of costs for discovery, engineering, preclinical and clinical studies, including personnel, consulting, clinical trial expenses, and regulatory costs. These expenses are expected to increase substantially as product candidates advance[107][109] - General and administrative expenses include personnel costs for executive, legal, finance, and administrative functions, professional fees, and other operating expenses. These are expected to increase due to headcount expansion and public company operating costs[110][111] - Interest and other income, net, primarily comprises interest earned on cash, cash equivalents, and short-term investments, including amortization/accretion of premiums/discounts, and foreign currency exchange gains/losses[114] Results of Operations This section analyzes the company's financial performance, highlighting key changes in revenues, expenses, and net loss over the reporting periods Results of Operations - Three Months Ended June 30 (in thousands) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Change ($) | Change (%) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :--------- | :--------- | | Research and development | $54,710 | $22,050 | $32,660 | 148% | | General and administrative | $15,741 | $11,266 | $4,475 | 40% | | Interest and other income, net | $8,929 | $7,335 | $1,594 | 22% | | Net loss | $(61,661) | $(26,034) | $(35,627) | 137% | Results of Operations - Six Months Ended June 30 (in thousands) | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change ($) | Change (%) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :--------- | :--------- | | Research and development | $97,577 | $42,729 | $54,848 | 128% | | General and administrative | $29,185 | $22,602 | $6,583 | 29% | | Interest and other income, net | $18,505 | $13,343 | $5,162 | 39% | | Net loss | $(108,494) | $(52,070) | $(56,424) | 108% | - The increase in R&D expenses was primarily due to preclinical research, clinical trial costs, employee expenses (personnel increase), and a $3.0 million milestone payment under the Aconcagua-Schrödinger Agreement[116][121] Product Candidate R&D Expenses - Three Months Ended June 30 (in thousands) | Product Candidate R&D Expenses | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Aleniglipron (GSBR-1290) | $28,365 | $9,943 | | ACCG-2671 | $9,649 | $2,429 | | ANPA-0073 | $1,048 | $1,635 | | LTSE-2578 | $1,493 | $2,181 | | Other | $14,155 | $5,862 | | Total R&D Expenses | $54,710 | $22,050 | Product Candidate R&D Expenses - Six Months Ended June 30 (in thousands) | Product Candidate R&D Expenses | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Aleniglipron (GSBR-1290) | $53,350 | $19,478 | | ACCG-2671 | $15,259 | $4,412 | | ANPA-0073 | $2,154 | $2,749 | | LTSE-2578 | $2,919 | $4,343 | | Other | $23,895 | $11,747 | | Total R&D Expenses | $97,577 | $42,729 | Liquidity and Capital Resources This section discusses the company's ability to generate and manage cash, its funding sources, and future capital requirements - The company has funded operations through equity financings, including an IPO ($166.7 million net proceeds in Feb 2023), a Private Placement ($281.5 million net proceeds in Oct 2023), and a Follow-On Offering ($512.7 million net proceeds in June 2024)[125] - As of June 30, 2025, cash, cash equivalents, and short-term investments totaled $786.5 million, with an accumulated deficit of $437.6 million. The company believes existing capital is sufficient for at least 12 months, covering projected operations and key clinical milestones through 2027 (excluding Phase 3 registrational studies)[125][126][127] - Substantial additional capital will be needed for Phase 3 clinical studies of aleniglipron and future operations, with funding expected from equity sales, debt, grants, or collaborations[102][129][131] Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash used in operating activities | $(106,787) | $(60,473) | | Net cash provided by (used in) investing activities | $82,975 | $(203,097) | | Net cash provided by financing activities | $1,326 | $515,405 | | Net (decrease) increase in cash and cash equivalents | $(22,486) | $251,835 | - Contractual obligations as of June 30, 2025, include $8.6 million in facilities lease payments, with $3.1 million due within the next 12 months[141] Item 3. Quantitative and Qualitative Disclosures About Market Risk This section states that there were no material changes to the company's quantitative and qualitative disclosures about market risk during the six months ended June 30, 2025, compared to those reported in its Annual Report - No material changes to quantitative and qualitative disclosures about market risk were reported during the six months ended June 30, 2025[145] Item 4. Controls and Procedures Management, including the Chief Executive Officer and Chief Financial Officer, concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2025. No changes in internal control over financial reporting were identified that materially affected, or are reasonably likely to materially affect, internal control during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that disclosure controls and procedures were effective at the reasonable assurance level as of June 30, 2025[147] - No changes in internal control over financial reporting were identified during the quarter ended June 30, 2025, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[148] PART II. OTHER INFORMATION This section provides additional disclosures beyond financial statements, including legal proceedings, risk factors, and other required information Item 1. Legal Proceedings The company is not currently involved in any material governmental investigations, private lawsuits, or other legal proceedings that would have a material adverse effect on its financial position, results of operations, or cash flows - The company is not currently the subject of any material governmental investigation, private lawsuit, or other legal proceeding[151] Item 1A. Risk Factors The company faces numerous risks, including its limited operating history, significant ongoing losses, and substantial capital requirements for product development. Key risks also involve the uncertain and lengthy drug development and regulatory approval processes, reliance on third parties for manufacturing and clinical studies, intense competition, and challenges in achieving market acceptance and reimbursement. Furthermore, the company's international operations, particularly in China, expose it to geopolitical, regulatory, and intellectual property risks, while its public company status adds compliance costs and potential stock price volatility Risks Related to Our Limited Operating History, Financial Position and Capital Requirements This section highlights financial risks stemming from the company's early operational stage, consistent losses, and significant future capital needs - The company has a limited operating history, has incurred significant operating losses since its inception, and expects to incur significant losses for the foreseeable future, with an accumulated deficit of $437.6 million as of June 30, 2025[153][154] - Substantial additional capital will be required to finance operations, particularly for Phase 3 clinical studies of aleniglipron, and this capital may not be available on acceptable terms or at all, potentially forcing delays or termination of product development programs[156][157][159] - Raising additional capital may dilute shareholder ownership, restrict operations through debt covenants, or require relinquishing rights to technologies or product candidates through collaborations[161] Risks Related to the Discovery, Development and Regulatory Approval of Product Candidates This section details the inherent uncertainties, high costs, and lengthy processes involved in drug discovery, clinical development, and obtaining regulatory approvals - The company's structure-based drug discovery platform is unproven, and there is no guarantee of developing commercially valuable products. Failure of one program could negatively impact perception of others[162] - The company is in early development stages with only four product candidates (aleniglipron, ACCG-2671, ANPA-0073, LTSE-2578) in early clinical development, and all other programs are preclinical or discovery stage. Successful advancement, regulatory approval, and commercialization are uncertain and subject to significant delays[165][168][169] - Clinical and preclinical drug development is a lengthy, expensive, and uncertain process. Prior results are not necessarily predictive of future outcomes, and product candidates can fail at any stage[170][174] - Difficulties or delays in clinical studies, such as data collection omissions, patient enrollment challenges, or regulatory hurdles, could increase costs, delay revenue generation, and adversely affect commercial prospects[175][177][179][189] - Serious adverse events or unexpected properties of product candidates identified during development or after approval could lead to discontinuation of programs, refusal of regulatory approval, or revocation of marketing authorizations[191][192][193] - The company lacks experience in conducting later-stage clinical studies or submitting New Drug Applications (NDAs), which are lengthy, time-consuming, expensive, and inherently unpredictable processes[196][198] - There is a risk of expending limited resources on product candidates or indications that may be less profitable or have a lower likelihood of success, potentially missing greater commercial opportunities[202] - The company may not be able to obtain or maintain orphan drug designations or exclusivity for its product candidates, which could limit their potential profitability[203][206] - Clinical studies conducted outside the United States (e.g., Australia, China) may not be accepted by the FDA or other foreign equivalents, leading to delays and increased costs[207][208] - Preliminary, topline, and interim data from clinical studies are subject to change and audit, and may differ materially from final data, potentially harming business prospects[209][210] Risks Related to Commercialization of Our Product Candidates This section addresses challenges in bringing approved product candidates to market, including regulatory compliance, market acceptance, reimbursement, and competitive pressures - Even if product candidates receive marketing approval, they will be subject to ongoing regulatory obligations and review, potentially leading to significant additional expenses, labeling restrictions, or market withdrawal[255][256][259][260][261] - Market acceptance by physicians, patients, and third-party payors is crucial for commercial success, and failure to achieve adequate acceptance could prevent significant product revenue[263][264] - Coverage and adequate reimbursement may not be available for approved product candidates, making profitable sales difficult and impacting demand and pricing[265][267][268] - The company faces substantial competition from major pharmaceutical and biotechnology companies, including those utilizing AI for drug discovery, which may result in others commercializing products more successfully[269][270][271][273][274][276] - If market opportunities for product candidates are smaller than estimated, revenue may be adversely affected[277] - The company currently lacks a marketing and sales organization and experience in commercializing products, requiring significant investment or reliance on third parties, which may not generate sufficient product revenue[279] - Commercializing products in foreign markets exposes the company to additional regulatory burdens, economic, political, and other risks[280] Risks Related to Our Business Operations and Industry This section covers operational challenges, regulatory compliance, personnel dependency, and external factors affecting the company's business and the broader industry - Operating results may fluctuate significantly due to various factors, making future predictions difficult and potentially causing results to fall below expectations[281][282] - High dependence on senior management and the ability to attract and retain qualified personnel. Failure to do so could harm business operations and growth[283][286][287] - The need to expand the organization and manage growth could disrupt operations and divert management attention[289][290] - Operations in Australia, conducted through wholly-owned subsidiaries, are subject to risks including the potential loss or refund of research and development tax credits[292][294] - Relationships with healthcare providers and third-party payors are subject to federal and state healthcare fraud and abuse laws, false claims laws, and health data privacy and security laws. Non-compliance could lead to substantial penalties[295][296][297][298][299][300] - Healthcare legislative reform measures, such as the ACA, IRA, and OBBBA, may negatively impact the business and results of operations, particularly regarding drug pricing and reimbursement[301][302][303][304][305][306][307][310] - The use of hazardous and biological materials by third-party manufacturers could lead to liability for damages, fines, or operational interruptions[311] - Product liability lawsuits related to clinical testing or commercialized products could result in substantial liabilities, decreased demand, and harm to reputation[312][315] - Compromises or disruptions to information technology systems or data, including those of third parties, could lead to significant financial, legal, regulatory, business, and reputational harm[316][317][318][320][321][322] - Misconduct by employees, principal investigators, consultants, or commercial partners, including non-compliance with regulatory standards or insider trading, could lead to regulatory sanctions and reputational damage[323] - Governments outside the United States may impose strict price controls on prescription pharmaceuticals, adversely affecting potential revenues[324] - The company is subject to stringent and evolving U.S. and foreign data security and privacy laws (e.g., GDPR, CCPA, PIPL), with non-compliance potentially leading to government enforcement actions, litigation, fines, and business disruptions[325][327][328][329][330][331][332][335][336][337][338][339][342] - Tax risks are associated with cross-border arrangements and activities between the company and its subsidiaries, with potential challenges to transfer pricing and increased tax liabilities[343][344][345][346] - Changes in tax laws or regulations, such as the One Big Beautiful Bill Act, could adversely affect the business, cash flow, financial condition, or results of operations[348] Risks Related to Doing Business in China and Our International Operations This section outlines the specific political, economic, regulatory, and legal risks associated with the company's operations and business relationships in China and other international markets - Changes in political and economic policies or relations between China and the United States may affect the company's business, financial condition, results of operations, and the market price of its ADSs[349][351] - Compliance with China's Data Security Law, Cyber Security Law, Cybersecurity Review Measures, and Personal Information Protection Law (PIPL) may entail significant expenses and affect business operations, with uncertainties in interpretation and implementation[352][353][354][355][356][357][358][359] - Approval, filing, or other procedures with the CSRC or other Chinese regulatory authorities may be required for issuing securities to foreign investors, and the ability to obtain such approvals or complete procedures is uncertain[360][362][363] - Pharmaceutical companies operating in China are subject to extensive regulations and permit requirements, and the ability to obtain and maintain these approvals is uncertain, with future government regulation potentially placing additional burdens[364][366] - As a company with operations and business relationships outside the United States, the business is subject to economic, political, regulatory, and other risks associated with international operations[367][369] - Failure to comply with Chinese environmental, health, and safety laws and regulations could lead to fines, penalties, or costs that materially adversely affect the business[370][371] - Developments in the Chinese legal system, which is a civil law system with evolving laws and regulations, could materially and adversely affect the company[372] - Exposure to the U.S. Foreign Corrupt Practices Act (FCPA), U.S. domestic bribery laws, and similar anti-corruption and anti-bribery laws in China and other countries, as well as export controls and trade sanctions, could limit competitiveness and harm reputation[373][375][376] - Chinese regulatory requirements on currency exchange may limit the ability to receive and effectively use financing in foreign currencies for Chinese subsidiaries[377][378] - Chinese regulations relating to the establishment of offshore special purpose companies by residents in China may subject beneficial owners or subsidiaries to liability or penalties, and limit capital injection or profit distribution[379][380][381] - Classification as a China resident enterprise for China income tax purposes could result in unfavorable tax consequences, including a 25% EIT on global income and withholding taxes on dividends and gains for non-Chinese shareholders[382][384][385] - Uncertainties exist in China regarding indirect transfers of equity interests in China resident enterprises, potentially subjecting such transfers to income tax[386][388] - Failure to comply with Chinese regulations regarding registration requirements for employee equity incentive plans may lead to fines and sanctions[389] Risks Related to Our Intellectual Property This section addresses the critical risks associated with obtaining, maintaining, and enforcing intellectual property rights, including patents, trade secrets, and trademarks - Inability to obtain and maintain sufficient or broad intellectual property protection for platform technologies and product candidates could allow competitors to develop similar products, adversely affecting commercialization[390][392][393][394][395] - Patent rights relating to pending applications may not issue, or issued patents may be challenged, invalidated, or rendered unenforceable, leading to loss of exclusivity or narrowed protection[396][398][399][401] - Reliance on trade secrets and proprietary know-how is vulnerable to disclosure or misappropriation, which can be difficult to trace and enforce, harming the business and competitive position[402][403] - Reliance on in-licenses from third parties means losing these rights or disputes with licensors could materially adversely affect the business and ability to develop/commercialize products[404][405][406][407][409][410][411] - Intellectual property licensed from third parties may be subject to retained rights by licensors or government agencies (e.g., Bayh-Dole Act), potentially limiting the company's ability to exploit or enforce patents[412][414] - Obtaining and maintaining patent protection requires compliance with various procedural, document submission, and fee payment requirements; non-compliance could lead to loss of patent rights[415][416] - Patent terms may be inadequate to protect competitive position for a sufficient amount of time, especially given the lengthy development and regulatory review process[417][419][420] - Intellectual property rights have limitations and may not adequately protect the business from various threats, such as competitors developing similar compounds not covered by claims or independent development[421][424] - Third parties may initiate legal proceedings alleging infringement, misappropriation, or other violations of their intellectual property rights, leading to uncertain outcomes, substantial litigation expenses, and potential limitations on commercialization[422][425][426][427][428][429] - Lawsuits to protect or enforce patents or other intellectual property could be expensive, time-consuming, and unsuccessful, potentially resulting in loss of patent protection or an inability to stop infringers[430][431][432][434][435][436] - Changes in U.S. patent law (e.g., Leahy-Smith Act) or foreign patent law could diminish the value of patents, increasing uncertainties and costs for protecting inventions[437][438][439][440][441] - Inability to protect intellectual property rights throughout the world, particularly in countries with weaker enforcement, could negatively impact the business and competitive advantage[442][443][444] - Claims that employees, consultants, or advisors have wrongfully used or disclosed trade secrets of former employers, or claims asserting inventorship or ownership of the company's intellectual property, could lead to litigation and loss of valuable rights[445][446][447][448] - Failure to identify relevant third-party patents or incorrect interpretation of their relevance, scope, or expiration could adversely affect the ability to develop and market products[449][450] - Inadequate protection of trademarks and trade names could prevent building name recognition and adversely affect the business[451][452] Risks Related to Our ADSs This section addresses risks specific to the company's American Depositary Shares (ADSs), including market volatility, delisting potential, and shareholder rights - The trading price of the company's ADSs is likely to be highly volatile and subject to wide fluctuations due to various factors, including clinical study results, regulatory decisions, competition, and general market conditions, potentially leading to a loss of investment[453][455] - There is a risk of delisting under the Holding Foreign Companies Accountable Act (HFCA Act) or Accelerating Holding Foreign Companies Accountable Act (AHFCA Act) if the SEC identifies that the company's audit work is performed by an auditor not subject to PCAOB inspection, although currently, the company's auditor is PCAOB-inspected[456][457][458][460][461][462] - The company previously identified and remediated material weaknesses in internal control over financial reporting as of June 30, 2024. Future material weaknesses could lead to material misstatements in financial statements or failure to meet reporting obligations[463][464][465][466] - Principal shareholders and management own approximately 45% of the voting power, allowing them to exert significant control over matters requiring shareholder approval, potentially conflicting with other shareholders' interests[467] - Substantial future sales of ADSs by existing shareholders or through equity offerings could cause the market price to drop significantly[468][469] - Holders of ADSs have fewer rights than ordinary shareholders and must act through the depositary to exercise voting rights, potentially limiting their ability to vote or receive distributions[470][471][473] - ADS holders may not be entitled to a jury trial for claims arising under the deposit agreement, which could result in less favorable outcomes for plaintiffs[472] - The right to participate in future rights offerings may be limited, potentially causing dilution to holdings[474] - The company does not anticipate paying cash dividends in the foreseeable future, making capital appreciation the sole source of gains for investors[475] - The company is subject to tax in both the Cayman Islands and the United States, potentially leading to a material adverse effect on financial condition and results of operations[476][477][478] - The ability to use net operating loss carryforwards and certain other tax attributes may be limited by ownership changes (Sections 382 and 383 of the Code) or state tax laws, potentially increasing future tax liability[479][480] General Risk Factors This section covers broad risks impacting the company's overall operations, including financial infrastructure, internal controls, legal proceedings, and external disasters - Failure to build adequate finance infrastructure and improve accounting systems and controls could impair compliance with financial reporting and internal controls requirements for publicly-traded companies, leading to significant costs and potential misstatements[492][495][496][497][499] - Disclosure controls and procedures, or internal controls, may not prevent or detect all errors or acts of fraud due to inherent limitations[500][501] - Future changes in financial accounting standards or practices may cause adverse and unexpected revenue fluctuations and affect reported results of operations[502] - Lack of or unfavorable equity research analyst coverage could negatively impact the price and trading volume of the company's ADSs[503] - The company could be subject to securities class action litigation or material legal proceedings, which could have a negative impact on its reputation or business[504][506] - The company or third parties it depends on may be adversely affected by earthquakes, fires, or other natural disasters, and business continuity plans may not adequately protect against serious disasters[507] - Failure to comply with environmental, health, and safety laws and regulations could lead to fines, penalties, or costs that materially adversely affect the business[508][510] - Failure to meet Nasdaq's continued listing requirements could result in a delisting of the company's ADSs, negatively affecting their price and liquidity[511][512] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the three months ended June 30, 2025 - No unregistered sales of equity securities occurred during the three months ended June 30, 2025[513] Item 3. Defaults Upon Senior Securities The company reported no defaults upon senior securities during the period - No defaults upon senior securities were reported[514] Item 4. Mine Safety Disclosures The company reported no mine safety disclosures - No mine safety disclosures were reported[515] Item 5. Other Information The company reported no other information - No other information was reported[515] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including organizational documents, specimen certificates, the deposit agreement, certifications of principal officers, and XBRL interactive data files - The exhibits include the Amended and Restated Memorandum and Articles of Association, Registrant's Specimen Certificate for Ordinary Shares, Form of Deposit Agreement, and certifications of the Principal Executive Officer and Principal Financial Officer[517] Signatures The report was duly signed on August 6, 2025, by Raymond Stevens, Ph.D., Chief Executive Officer, and Jun Yoon, Chief Financial Officer, on behalf of Structure Therapeutics Inc - The report was signed by Raymond Stevens, Ph.D., Chief Executive Officer, and Jun Yoon, Chief Financial Officer, on August 6, 2025[520]