Nkarta, Inc. (NKTX) Business

Item 1. Business.

Overview

We are a clinical-stage biopharmaceutical company pioneering the development of allogeneic, off-the-shelf engineered natural killer ("NK") cell therapies. Our company was founded on the belief that engineered NK cell therapies can transform the lives of patients by offering therapies that are clinically meaningful, broadly accessible and unencumbered by the safety concerns often associated with other cell therapy approaches. Our lead pipeline program is NKX019, a chimeric antigen receptor-natural killer ("CAR NK") product candidate targeting the CD19 antigen for the treatment of patients with autoimmune diseases. Our CAR NK platform enables an on-demand, off-the-shelf approach involving scaled manufacturing to broaden patient access. We have developed proprietary technologies designed to generate an abundant supply of NK cells, increase NK cell recognition of target antigens, and enhance NK cell fitness to support scalable, off the shelf administration. NKX019 is allogeneic, which means it is produced using cells from a different person than the patient(s) being treated, and it is produced in quantity, then frozen and therefore available for treating patients without delay, unlike autologous cell therapies, which are derived from a patient’s own cells and must be manufactured as needed for each patient. We believe that engineered NK cells have the potential to be effective and accessible therapies for autoimmune diseases and other diseases, be well tolerated, and avoid some of the toxicities observed with other cell therapies.

NKX019 is currently being studied in an ongoing Phase 1 clinical trial ("Ntrust-1") for lupus nephritis ("LN") and primary membranous nephropathy ("pMN") and a Phase 1 clinical trial ("Ntrust-2") for systemic sclerosis ("scleroderma"), idiopathic inflammatory myopathy ("myositis"), and antineutrophil cytoplasmic antibody (ANCA)-associated vasculitis ("AAV"). NKX019 is also being studied in an investigator-sponsored trial ("IST") at Columbia University Irving Medical Center for systemic lupus erythematosus ("SLE") and an IST led by researchers at the University of California, Irvine and the University of Kansas Medical Center in myasthenia gravis ("MG"). NKX019 was initially studied in a Phase 1 clinical trial for certain B-cell malignancies, along with NKX101, a CAR NK product candidate targeting cells that display NKG2D ligands, which was studied in a Phase 1 clinical trial for certain hematologic malignancies. Both oncology studies closed patient enrollment in 2023 and have been deprioritized to direct primary resources to the development of our lead pipeline program, NKX019, for the treatment of autoimmune diseases.

Our modular engineering platform builds on the distinctive biology of NK cells and their role in eradicating aberrant and pathologically transformed cells. Our process starts with mature NK cells derived from healthy donors. We build on the intrinsic ability of these immune cells to identify and kill transformed cells with cell engineering to further enhance their activity. This engineering involves inducing the expression of a chimeric antigen receptor ("CAR") on the surface of an NK cell to enable the cell to recognize specific proteins or antigens that are present on the surface of target cells. Our engineered CAR NK cells consist of an NK cell engineered with a targeting receptor, OX40 costimulatory domain, CD3ζ(zeta) signaling moiety, and a membrane-bound form of the cytokine IL(interleukin)-15 ("mbIL-15").

NKX019

Our NKX019 autoimmune program is based on the potential to eliminate the pathologic B cells that produce autoantibodies believed to underpin multiple autoimmune diseases via CD19 targeting. These autoantibodies, the immunologic hallmark of many autoimmune diseases, inappropriately recognize antigens expressed in healthy cells, causing various clinical syndromes from the resultant damage to normal tissues. Abnormal B cells are also the cause of multiple hematologic malignancies, including B-cell lymphoma. Approved CD19-directed cell therapies can eliminate these cancerous B cells, resulting in the possibility of durable complete responses in patients that are refractory to other therapies. Targeted depletion of cells from the B-cell lineage as a therapeutic mechanism is common to both autoimmune diseases and B-cell malignancies. This observation, in addition to recent reported studies of patients with autoimmune diseases who had considerable clinical benefit following treatment with CD19-directed cell therapies, support our belief that NKX019 has the potential to be a disease-modifying therapy for autoimmune diseases. Ntrust-1 is a multi-center, open-label, dose-escalation Phase 1 clinical trial of NKX019 for LN and pMN. Ntrust-2 is a multi-center, open-label, dose-escalation Phase 1 clinical trial of NKX019 for scleroderma, myositis, and AAV, which we believe maximizes the potential success of our clinical trials. In May 2025, we announced the modification of the lymphodepleting conditioning ("LD") prior to administration of

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NKX019 to use a combination of fludarabine ("Flu") and cyclophosphamide ("Cy"), with the option for patients with cytopenias to continue to receive Cy alone as modified LD, in both our Ntrust-1 clinical trial and our Ntrust-2 clinical trial. At that time, we also announced that researchers at the University of California, Irvine initiated an IST of NKX019 in patients with MG.

In November 2025, we announced that deep B-cell depletion was observed in all patients treated to date who received NKX019 with LD using Flu and Cy versus partial B-cell depletion in patients receiving only Cy. At the same time, we reported the implementation of a streamlined enrollment process that allows participant data from both the Ntrust-1 and Ntrust-2 clinical trials to be reviewed by a combined independent Data Safety Monitoring Board (“iDSMB”) to inform dose-escalation decisions. This update followed engagement with the U.S. Food and Drug Administration (“FDA”) and authorization by the iDSMB to initiate enrollment in the second dose-escalation cohort.

The therapeutic benefit of targeting CD19-positive B cells in patients with SLE has been reported in a recent academic study published in Nature Medicine in September 2022 (Mackensen et al. (2022) Nat. Med. 28:2124-2132). Five patients with severe refractory SLE with LN received an autologous CD19 CAR T-cell therapy following LD with Flu and Cy. All patients showed significant clinical improvement in symptoms, including drug-free remissions after approximately three months. The CAR T cells expanded in all patients, with peak levels occurring around day 9, followed by a rapid decline. There was no high-grade cytokine release syndrome ("CRS"), no neurotoxicity, and no substantial elevation of serum IL-6 levels. Depletion of circulating B cells was rapid yet transient, with B cell numbers returning to normal within two to four months. This transience of depletion contrasts sharply with the CD19 CAR T-cell experience in B-cell malignancies, where B-cell suppression typically exceeds 18 months. Despite the limited persistence of CAR T cells and short-term B-cell suppression, all patients had seroconversion of anti-double-stranded DNA antibodies and ongoing disease control, even after B-cell recovery. A subsequent publication expanded this dataset to eight patients with SLE, all of whom had seroconversion and disease remission (Müller et al. (2024) N Engl J Med 390: 687-700). Median follow up in the group was 15 months with some patients having up to 29 months of remission.

As we pursue our goal of developing innovative and broadly accessible cell therapies, manufacturing capabilities and technology are a significant focus of our efforts. We have been manufacturing clinical supply at one of our two good manufacturing practice ("cGMP") facilities located in South San Francisco, California, and intend to use our second facility in South San Francisco for additional clinical supply, supply of NKX019 or future product candidates for future pivotal clinical trials, and potential commercial supply of our product candidates.

Our Strategy

We are developing novel engineered, allogeneic, off-the-shelf cell therapies to improve the lives of people living with autoimmune diseases. Key elements of our strategy to achieve this include:

CAR NK platform enlists natural, healthy human donor NK cells for optimal product candidates.

Our cell engineering platform utilizes healthy donors as our source for NK cells. By enlisting this natural source of NK cells, we start with bona fide NK cells endowed with inherent cytotoxic and tumor-recognizing capabilities. This contrasts with other more complex cell sources where these basic therapeutic features must be painstakingly designed and synthetically added to the cells. Donor-derived NK cells are also available in abundance, providing a large quantity of cells with which to begin each manufacturing run. Finally, healthy donor-derived adult cells consist of a diverse repertoire of NK cells. By utilizing a cell source that contains the full range of naturally occurring NK cells, we believe we can capitalize on the inherent diversity of the innate immune system and potentially select for different NK cell sub-populations with desired characteristics.

Prioritize development of NKX019 for B-cell mediated autoimmune diseases.

NKX019 is designed to target CD19, which is expressed through certain stages of B-cell development. When aberrantly activated, B cells can produce autoantibodies that inappropriately recognize cell surface antigens on normal cells. These antibodies and resultant immune complexes can damage normal tissues and lead to autoimmune diseases, such as LN. Due to the broad expression of CD19 on B cells, the targeting and depletion of CD19-positive

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B cells has been proposed as a mechanism by which long-term drug-free remissions may be achieved in B-cell mediated autoimmune diseases.

Autologous CAR T cell therapies have transformed the treatment landscape for certain blood cancers by targeting cancerous B cells via CD19. This approach also kills normal B cells in large numbers via an on-target, off-tumor effect. In those patients who respond to CD19-directed CAR T cell therapy, normal B cells are also depleted beyond detection in the blood. Recent academic studies have applied this approach of B-cell depletion to the treatment of patients with B-cell mediated autoimmune diseases. In one published report, five patients with highly refractory LN had remarkable improvements in clinical symptoms and normalization of autoantibodies following a course of treatment with CD19 CAR T cells. Because the targeting of CD19 has demonstrated clinical activity with CAR T and CAR NK cell therapies, we believe that NKX019 presents an opportunity to treat a variety of autoimmune diseases while addressing the limitations of CAR T cell therapies.

We are evaluating NKX019 in clinical trials for the treatment of LN, pMN, scleroderma, myositis, and AAV. We have shown that NKX019 is highly active in vitro against B cells from patients with B-cell mediated autoimmune diseases and continue to evaluate additional potential autoimmune indications for potential clinical investigation.

Continue to progress our proprietary manufacturing capabilities to enable speed, control, flexibility, scalability, and cost efficiency.

We believe that internal cGMP manufacturing capabilities will facilitate clinical product supply, lower the risk of manufacturing disruptions, and enable more cost-effective manufacturing for both clinical and, if successfully developed, commercial supply of our product candidates. We currently manufacture our clinical drug supply at one of our two cGMP facilities in South San Francisco, California. Our second facility is designed to manufacture additional clinical supply, including for potential pivotal clinical trials, and subject to successful scaling and process validation and operational readiness, may support commercial supply of NKX019 or future product candidates.

Based on our current operating plans and assumptions regarding manufacturing scaling and facility performance, we believe our current facilities will be sufficient to meet our anticipated requirements for non-pivotal and pivotal clinical trials, as well as our potential commercial launch.

Continue to advance our CAR NK platform.

Our proprietary NK cell engineering platform is based on a modular and generalizable approach that we believe enables us to generate next generation and new product candidates in a rapid and cost-efficient manner. Our engineered CAR NK cells generally consist of an NK cell engineered with a targeting receptor, OX40 costimulatory domain, CD3ζ(zeta) signaling moiety, and mbIL-15. We believe that the modular nature of our platform and the proprietary technologies we use for the multiplex engineering of NK cells are advantages that can support the generation of new Investigational New Drugs ("INDs") for product candidates with enhanced properties. With these attributes, we plan to continue assessing opportunities to develop additional product candidates focused on novel targets as well as clinically and commercially validated targets.

Continue to evaluate enabling, adjacent or potentially competing technologies, and, where advantageous, seek licenses or collaborations regarding those technologies, to advance our platform.

We continue to evaluate enabling, adjacent, and potentially competing technologies that may enhance our NK cell platform and expand the potential applications of our product candidates. As part of these efforts, we conduct discovery and preclinical research designed to identify new targets, engineering approaches, and manufacturing innovations that may improve the functionality, scalability, or therapeutic potential of our NK cell product candidates. We may also pursue licenses, strategic collaborations, or other partnerships with biotechnology and pharmaceutical companies, academic institutions, or technology providers where such arrangements could accelerate development, broaden our platform capabilities, or support the advancement of our pipeline.

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The Immune System and Autoimmune Diseases

The normal role of the immune system is to defend the body’s own tissues against harmful pathogens. However, in autoimmune diseases, the immune system targets the body’s own cells and tissues. This occurs due to the loss of immune tolerance, a mechanism that prevents the immune system from reacting against the body’s own tissues and self-antigens. When immune tolerance is lost, activation of autoreactive immune cells including T and B cells occurs, resulting in T and B cells being unable to recognize the body as “self”. This leads to the body’s own T cells directly attacking target self-antigens and causes B cells to produce autoantibodies that lead to inflammation and tissue damage.

The enhancement and engineering of immune effector cells to selectively target and kill pathologic cells has had a profound impact on the treatment of hematologic malignancies. This approach is now being investigated for its potential to “reset” the immune system in the context of autoimmune diseases. Several autoimmune diseases are associated with the production of autoantibodies that act against healthy cells and tissue. The use of immune effector cells to target the source of these autoantibodies is being explored as a potential disease modifying therapy for autoimmune diseases.

Cellular Immunotherapies

Cellular immunotherapy involves engineering human cells to recognize and destroy diseased cells in a targeted manner. Most cellular immunotherapies are focused on modulating or enhancing the activity of different lymphocytes, a subtype of white blood cell that are responsible for defending the body against pathogens and other foreign material, as well as killing cancerous cells within the body. There are different classes of lymphocytes which differ in function. T cells are a type of lymphocyte that primarily serves to protect from infections such as bacteria, viruses, fungi, and parasites. Every T cell recognizes a specific antigen, or substances found on pathogens or other foreign material. This type of lymphocyte is activated and divides rapidly when it detects its specific antigen. Accordingly, T cells are the foundation of the adaptive immune system, selectively responding to different threats.

NK cells are the foundation of the innate immune system. While T cells are activated by unique antigens specific to each T cell, the activity of NK cells is tightly regulated by a common set of activating receptors on these cells that serve to improve recognition and killing of cancerous or virally infected cells, as well as a set of inhibitory receptors that help identify healthy cells. This balance of inhibition and activation spares healthy cells from the surveillance and killing effects of the innate immune system.

A frequently used approach for cellular immunotherapy involves engineering CARs on the surface of a lymphocyte that enable the cell to recognize specific proteins or antigens that are present on the surface of diseased cells. The concept of a CAR builds upon and enhances the normal biology of T cells and NK cells, whereby naturally occurring receptors serve to activate these cells when a foreign pathogen or transformed cell is detected. The key components of CARs used today often include the following elements:

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Target binding domain. At one end of the CAR is a binding domain that is specific to a target antigen or protein. This domain extends out from the surface of the engineered lymphocyte, where it can recognize the target antigen or antigens. The target binding domain may be based upon a binder derived from a monoclonal antibody against a target antigen, such as the CD19 binder for NKX019.

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Transmembrane domain and hinge. This middle portion of the CAR links the target binding domain to the activating elements inside the cell. This transmembrane domain anchors the CAR in the cell’s membrane. In addition, the transmembrane domain may also interact with other transmembrane proteins that enhance CAR function. The hinge domain, which extends to the exterior of the cell, connects the

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transmembrane domain to the receptor and provides structural flexibility to facilitate binding to the target antigen on the surface of the target cell.

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Activating domains. The other end of the CAR, inside the lymphocyte, includes domains responsible for activating the lymphocyte when the CAR binds to its target antigen. The first, found in almost all CAR constructs, is called CD3ζ(zeta) and is the natural basis for lymphocyte activation. The second, called a costimulatory domain, is found in the more recent generations of CARs under development and provides an additional activating signal. Together, these signals trigger lymphocyte activation, resulting in proliferation of the CAR cells and killing of the diseased cells. In addition, activated CAR cells stimulate the secretion of cytokines and other molecules that can thereby recruit and activate additional immune cells to increase killing of the diseased cells.

The FDA has approved six CAR-based T-cell therapies for the treatment of certain types of cancer affecting B cells, and several CAR-based T-cell therapies are in clinical development for B-cell mediated autoimmune diseases. Each of these approved therapies is an autologous therapy, or derived from a patient’s own cells, which necessitates a complex, individualized manufacturing process for every patient treated. The approvals of these patient-specific cell therapies were a landmark event for many reasons, including the ability to treat and provide long-term remission for otherwise deadly disease; achieving the run-to-run product consistency required by the FDA despite the complex manufacturing required; and achieving successful reimbursement in the United States and other countries of several hundred thousand dollars per treatment. To date, there are no approved cell therapies to treat autoimmune diseases driven by autoantibody-producing B cells.

Limitations of Current CAR T Therapies

Despite advances made with CAR T therapies, including approvals in cancer, the accessibility of these cell therapies remains limited and may impact their potential to treat autoimmune diseases. Only a minority of eligible patients who might benefit from currently approved cell therapies are able to receive them. These therapies have certain features that are believed to limit their accessibility and broader adoption. These features include:

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Adverse events. According to the product labels for the three CAR T therapies approved for non-Hodgkin lymphoma ("NHL"), CRS was observed in 46% to 94% of patients treated in the respective pivotal clinical trials. In addition, neurotoxicity was seen in 35% to 87% of patients treated in such trials. Because of the frequency and severity of these adverse events, patients treated with the approved CAR T therapies can require lengthy hospitalization and costly ancillary care. In 2024, the FDA required that a boxed warning be added on all approved CAR T therapies for B-cell malignances to reflect the risk of secondary T-cell malignancies occurring after CAR T treatment.

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Availability restricted to select centers. Administration of CAR T therapies is concentrated at specialized treatment centers due to safety considerations, infrastructure requirements, and logistical complexity. In June 2025, the FDA eliminated the Risk Evaluation and Mitigation Strategy ("REMS") program that had previously applied to then-approved BCMA- and CD19-directed CAR T therapies; however, the administration of these therapies continues to require significant clinical expertise and institutional capabilities.

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Accessibility further compromised by lengthy manufacturing time. Due to the individualized manufacturing process, patients must wait approximately two to four weeks to be treated with their engineered cells. In the registrational trials for the first four approved CAR T therapies, 7% to 34% of enrolled patients did not receive CAR T cells, for reasons including manufacturing failure as well as patient progression or death while waiting for manufacturing.

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High manufacturing complexity and cost. The manufacture of autologous T cell therapy is individualized and labor-intensive. The collection of T cells through leukapheresis from each individual patient is a time-consuming and costly step in the autologous manufacturing process. In contrast to traditional pharmaceutical manufacturing where a single manufacturing run generates product for hundreds or thousands of patients, a full manufacturing run of autologous T cell therapy generates product for a single patient. In addition, autologous T cell therapy requires specialized infrastructure to maintain a strict chain of custody and identity of patient cells throughout collection, manufacturing and delivery, adding significant cost to the process and limiting the ability to scale.

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These limitations are difficult to address as many are inherent to fundamental aspects of T cell biology. CRS, which accounts for many of the adverse events which in part limit availability, is believed to be a consequence of the exponential expansion of T cells upon detection of a target antigen. Manufacturing time, product variability, and cost are due in great part to the autologous nature of approved CAR-T therapies.

Allogeneic NK Cell Therapies

The development of allogeneic, off-the-shelf cell therapies addresses certain limitations of autologous CAR T cells by offering these potential advantages:

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Tolerability. In initial clinical data reported by us and others, patients who received allogeneic NK cell therapies did not experience the more severe adverse events that are commonly associated with approved autologous CAR T cell therapies. This emerging safety profile of allogeneic NK cell therapies may enable their use in outpatient settings and broader access to treatment.

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Availability. Because an allogeneic NK cell therapy is produced in quantity then frozen in advance of patient need, it would be available for on-demand administration to patients in an outpatient setting.

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Consistency. By using true NK cells from a healthy donor as starting material, and producing large numbers of doses per manufacturing run, an allogeneic NK cell therapy provides the opportunity for more rigorous quality control and release of consistent engineered cells.

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Cost of manufacturing. An allogeneic NK cell therapy provides an opportunity to spread manufacturing costs across a large number of doses, thereby significantly lowering the cost per dose produced.

The Opportunity for Engineered NK Cells in Treating Autoimmune Diseases

Early studies using CD19-directed CAR T-cell therapies provide important proof of concept for disease modification in autoimmune diseases. In addition, some features of NK cells are potentially advantageous, as compared to T cells.

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Well-defined target. Targeting CD19 cells can lead to a deep suppression of the B cells that produce pathogenic autoantibodies. Despite this transient suppression afforded by cell therapy thus far, some patients have shown sustained drug-free remissions that persist after recovery. This has potential applicability to multiple autoimmune diseases that are similarly driven by autoantibodies.

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Supportive data. NKX019 has been extensively evaluated in clinical and pre-clinical settings. In our NKX019 clinical trial in oncology, NKX019 drove responses in patients with various refractory B-cell malignancies. Further, in vitro assays reveal consistent sensitivity to B cells collected from patients with various autoimmune diseases.

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B cell susceptibility. Pathogenic B cells that secret autoantibody may be more susceptible to NK-mediated killing than cancer cells. Malignant B cells have multiple pathways for evading killing, including antigen escape via downregulation or loss of CD19 expression and growth in a tumor cluster which offers a relatively immunosuppressive and inaccessible tumor microenvironment, none of which is expected in non-malignant B cells, although NKX019 can target cells expressing low levels of CD19. Further, the cell burden of target cells is generally much lower at the time of treatment in autoimmune diseases than in B-cell malignancies, thereby increasing the expected effector to target ratio of NKX019 in contrast to the antigen-dependent activation and expansion required by CD19-directed CAR T therapies.

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Tissue trafficking and penetration. NK cells traffic to nearly every tissue in the body, including immune-privileged sites that are known to be isolated from the rest of the body’s immune system. In addition, malignant B cells provide a proxy for trafficking of B cells, and NKX019 has driven complete responses in patients with NHL despite widespread malignant B cell (blood, bone marrow, lymph nodes, secondary lymphoid tissue, extra-nodal sites).

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Immediate activity. NK cells do not require expansion for maximal activity and peak exposure occurs near the time of infusion. The explosive growth of T cells is believed to be the basis of both their activity and the risk of CRS and immune effector cell-associated neurotoxicity syndrome associated with CAR T cell therapy.

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Disease-tailored LD. Adoptive cell therapy typically requires LD, which is preparative chemotherapy often with Cy and Flu, to provide an optimal cytokine milieu and suppress the host immune response. However, the pharmacokinetics of NK cells and T cells differ, enabling alternative LD approaches to address these differences. Specifically, the early peak exposure and mbIL-15 engineering of NKX019 allow evaluation of single-agent LD with Cy. A Flu-sparing LD regimen would eliminate potential toxicities of this agent, including cytopenias and myelodysplastic syndromes. Further, Cy is already used by specialist providers for various autoimmune conditions and may provide an opportunity for expanding this potentially disease-modifying to multiple other areas of high unmet need beyond SLE.

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On-demand availability. Because an allogeneic NK cell therapy is produced in quantity then frozen in advance of patient need, it would be available for on-demand administration to patients, potentially in an outpatient setting, where patients with autoimmune diseases are typically treated. This approach also eliminates the need for infrastructure to support apheresis and other facets of bespoke manufacturing, lowering the burden for providers and facilities to deliver therapy.

Challenges with Developing NK Cell Therapies

We believe that the emerging data from our clinical trials of NK cell products along with the prior academic experience with NK cells validate the opportunity for NK cells for the treatment of autoimmune diseases. To achieve a commercially viable engineered NK cell therapy, we believe that a number of challenges inherent with NK cells must be addressed. These include the following:

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Expansion. One of the historical challenges in treating patients with NK cells has been the lack of robust techniques to grow these cells in large numbers without causing exhaustion, or the inability of the expanded NK cells to kill target cells with the same potency as native NK cells.

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Engineering. Primary NK cells have been reported to be difficult to engineer efficiently. Poor efficiency of engineering could limit the potency and consistency of engineered NK cell therapies.

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Persistence. Non-engineered human NK cells turn over rapidly, with a half-life of seven to 10 days in the body. This short lifetime could limit the cytotoxicity of these NK cells.

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Cryopreservation. Without cryopreservation, a truly off-the-shelf engineered NK cell therapy would be challenging to commercialize. However, freezing then thawing NK cells while maintaining cytotoxicity is difficult to achieve using standard techniques for T cell cryopreservation.

Our NK Cell Engineering Platform

Our cell engineering platform is designed to operationalize the full therapeutic potential of NK cells and address the limitations and challenges of current technologies for engineering T cells and NK cells. The platform is a result of our internal expertise and deep understanding of NK cell biology. It includes proprietary technologies for NK cell expansion, persistence, targeting, genome editing, and cryopreservation. This enables us to generate an abundant supply of NK cells, engineer enhanced NK cell recognition of target antigens, improve the persistence of these cells for sustained activity in the body, and freeze, transport and store our engineered NK cells for off-the-shelf use for the treatment of autoimmune diseases.

We have chosen to use healthy donors as our source for NK cells. We believe this offers a number of advantages including:

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Starting with differentiated, natural, and mature NK cells with inherent cell-targeting and cytotoxic capabilities, as compared to other cell sources such as stem cells, which must be artificially manipulated in an in vitro setting to reproduce these fundamental features;

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A large number of NK cells as starting material for each manufacturing run, as compared to other potential sources of NK cells;

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The ability to select donors with consistent and favorable NK cell characteristics, thereby avoiding challenges with patient-derived or other cell sources; and

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A diverse repertoire of NK cells. Different NK cell sub-populations have different characteristics, and by utilizing the entire natural gamut of NK cells as our cell source, we can capitalize on the inherent diversity of the innate immune system.

Below are the five core technologies that comprise our proprietary platform. Each of these technologies is part of an integrated approach to develop potent, scalable, and consistent NK cell products:

Expansion. The first pillar of our technology platform enables NK cell expansion without causing cell exhaustion. Our proprietary, engineered K562 stimulatory cells ("NKSTIM cells") have been engineered with mbIL-15 as well as a protein named 4-1BB ligand ("4-1BBL"). IL-15 is a naturally occurring growth protein that induces cell proliferation in NK cells. 4-1BBL binds to 4-1BB, a receptor normally found on NK cells that stimulates NK cell division and expansion. Therefore, NKSTIM cells are selectively able to stimulate the expansion of NK cells as compared to other leukocytes, and thereby provide large numbers of NK cells. Based on our current process and early cGMP manufacturing experience, we believe that we can produce hundreds of doses from a single manufacturing run.

Persistence. Pharmacokinetics of allogeneic NK cells will be limited by both immune suppression of allogeneic cells following LD, and by the intrinsic half-life of the administered cells. In addition to immune suppression, LD enhances the bioavailability of host cytokines, especially IL-15, which is associated with improved persistence of CAR T cell therapies. The second component of our technology platform is engineering NK cells with mbIL-15 to enhance their persistence without dependence on LD-mediated cytokines, facilitating a disease-tailored approach to LD. Because IL-15 is a selective driver of NK activation and expansion, tethering IL-15 to the surface of our engineered NK cells serves to stimulate the naturally occurring IL-15 receptor on these NKs, and thereby provide weeks of persistence in immune-deficient animal models. Because mbIL-15 selectively stimulates NK cells without elevating soluble IL-15 concentration, we believe that mbIL-15 provides meaningful advantages as compared to secreted IL-15 or the systemic administration of other cytokines such as IL-2 or IL-21. The first graph below shows data from a cell culture experiment which demonstrates the increase of the number and persistence of NK cells engineered with mbIL-15, as compared to unmodified NK cells or NK cells expressing soluble IL-15. The second graph below shows the increased number and persistence in mice of NK cells engineered with mbIL-15, as compared to unmodified NK cells, as a percentage of total peripheral blood mononuclear cells.

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Source: Imamura et al., Blood. 2014 Aug 14;124(7):1081-8

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Targeting and Signaling. The third element of our technology platform is CARs optimized for NK cells, based on extensive preclinical evaluation of different possible constructs. We have performed extensive optimization of the CARs that serve to direct our engineered NK cells to target-cells as well as provide signals that engage the inherent ability of NK cells to target and kill transformed cells. For NKX019, we have found that using the OX40 costimulatory domain enhances the ability of the engineered NK cells to kill cancerous cells repeatedly in several in vitro models, as compared to CAR NK cells that include other costimulatory domains commonly used for CAR T cells. We confirmed these findings in animal models for both product candidates.

Genome Editing. The fourth component of our platform is the ability to edit our NK cells using CRISPR-Cas9 technology. We have identified a number of genomic modifications that serve to further enhance the cytotoxicity and resistance to tumor-mediated immune suppression. We have shown that knocking out certain genes can prolong the persistence and activity of CAR NK cells, and improve their resistance to suppression by the tumor microenvironment.

Immune Evasion. Through a combination of ectopic expression and genome editing, we have identified a number of strategies that could enable NK cells to resist allogeneic suppression.

Cryopreservation. The fifth constituent of our technology platform is cryopreservation of our engineered NK cells, the ability to freeze and store these cells for an extended time. The development of robust cryopreservation techniques is a result of our insight into the biology of engineered NK cells as well as extensive experimental optimization. Based on our preclinical data, we are able to freeze and subsequently thaw individual doses of engineered NK cells without significant loss of cell killing potency of our engineered NK cells. Cryopreservation of our allogeneic CAR NK cells will enable their off-the-shelf use in medical centers around the world, for administration to a patient at any time. Therefore, we believe that our cryopreservation of CAR NK cells will enable us to achieve the attractive commercial profile of an off-the-shelf, allogeneic cell therapy.

We believe that these key elements of our technology platform have the potential to grant us a key competitive advantage if our product candidates are approved.

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Our Pipeline

Our current pipeline for our lead program is shown below.

NKX019

Our product candidate NKX019 consists of allogeneic, donor-derived and expanded NK cells that have been genetically engineered to express mbIL-15 along with a CAR containing a CD19 binder, an OX40 costimulatory domain and a CD3ζ(zeta) signaling moiety for enhanced cell targeting and greater persistence and activity. CD19 is expressed on B cells through various stages of development, including on plasmablasts, which are associated with autoantibody production. NKX019 is active against B cells, supported by our clinical data from patients in our clinical protocols, as well as in vitro studies using cell collected from patients with various autoimmune diseases.

Ntrust-1 Clinical Trial for Lupus Nephritis and Primary Membranous Nephropathy

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In October 2023, we announced the clearance of an IND application by the FDA to evaluate NKX019 for the treatment of LN in our Ntrust-1 clinical trial, and in May 2025, we announced the addition of pMN as an indication to our Ntrust-1 clinical trial, which is a multi-center, open-label, dose-escalation Phase 1 clinical trial that evaluates the safety and clinical activity of NKX019 in patients with refractory LN. The clinical trial consists of dose-finding followed by dose-expansion and is designed to identify the recommended Phase 2 dose. Patients receive a three-dose cycle of NKX019 at 1 billion or 1.5 billion cells per dose on Days 0, 3, and 7 following LD with single agent cyclophosphamide, an agent with an established safety profile in SLE and LN. The study is designed to initially enroll up to 12 patients, and in December 2024, we announced the first patient had been dosed. The dosing schema for the clinical trial is shown in the graphic below.

Ntrust-2 Clinical Trial for Additional Autoimmune Diseases

In June 2024, we announced the clearance of an IND application by the FDA to evaluate NKX019 for the treatment of scleroderma, myositis, and AAV. Ntrust-2 is enrolling patients with scleroderma, myositis, and AAV into parallel cohorts, and NKX019 will be dosed on Days 0, 3, and 7. The study is designed to initially enroll up to 12 patients. The dosing schema for the clinical trial is shown in the graphic below.

Investigator Sponsored Trials for Autoimmune Diseases

In July 2024, we announced that researchers at Columbia University Irving Medical Center initiated an IST of NKX019 in patients with SLE, and in November 2024, we announced that their first patient had been dosed. This single-center, single-arm, open-label Phase 1 IST is designed to enroll up to six patients with SLE, regardless of renal involvement, and will evaluate safety and clinical outcomes in a potentially different population than Ntrust-1. Translational and biomarker studies, including autoantibodies, cytokine profiles and pharmacokinetics are also planned. Patients receive NKX019 on Days 0, 3 and 7 following LD with single-agent cyclophosphamide.

In December 2024, we announced the IND clearance of an IST led by researchers at the University of California, Irvine and the University of Kansas Medical Center to evaluate NKX019 in patients with MG. The single-arm, open-label Phase 1 IST is designed to enroll patients with MG and will evaluate safety and clinical outcomes. Translational and biomarker studies, including autoantibodies, cytokine profiles and pharmacokinetics are also planned. Patients will receive NKX019 on Days 0, 3 and 7 following LD with single-agent cyclophosphamide.

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CAR NK Platform and Other Programs

We have prioritized the development of NKX019 for B-cell mediated autoimmune diseases. We plan to continue assessing opportunities for further expansion of NKX019 into additional indications with supportive data for our mechanism. While the further development of our oncology programs has been deprioritized, we continue to monitor enrolled patients.

Manufacturing

Our process for the generation of an allogeneic, off-the-shelf NK cell therapy requires multiple steps. To achieve a commercially viable product, we believe that each of these steps must be scalable, reproducible and cost-effective and must provide consistent cell killing potency of our CAR NK cells once these cells are frozen and then thawed. Therefore, we have focused on developing a manufacturing process that incorporates the following elements:

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starting material consisting of differentiated, mature NK cells with inherent cytotoxic and tumor-recognizing capabilities, as compared to other cell sources such as stem cells, where these fundamental features must be engineered into the cells which must be artificially manipulated in an in vitro setting to reproduce these fundamental features;

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a cell source which provides high numbers of easily characterized NK cells;

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expansion technology which increases the number of NK cells by orders of magnitude, without inducing exhaustion;

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techniques for genetic engineering of NK cells which are cost-effective and which introduce a controlled and specified range of the number of copies of the gene into each cell;

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techniques for genome editing of NK cells to selectively knock-out or knock-in genetic targets in each cell;

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cryopreservation techniques that permit bulk CAR NK cells to be frozen in individual doses; and

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techniques for thawing the frozen NK cell product that are easy to adopt in different clinical settings, and that provide consistent CAR NK cell recovery, viability and potency.

Our overall manufacturing scheme is shown in the diagram below.

The source material for production of our off-the-shelf NK cell therapy product candidates is NK cells collected from healthy donors by leukapheresis, the selective collection of white blood cells from plasma. We then isolate the NK cells from the other cells in the leukapheresis product. Next, we selectively activate the NK cells by co-culture with NKSTIM cells. After initial expansion, we engineer the expanded NK cells using a gamma-retrovirus to express mbIL-15 and the CAR. We further expand the NK cells, followed by harvesting and cryopreservation to form the final cell product. For off-the-shelf administration, clinical sites will thaw the CAR NK product candidate for administration to patients at the clinical site.

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We believe that establishing our own internal cGMP manufacturing capabilities will facilitate clinical product supply, lower the risk of manufacturing disruptions, and enable more cost-effective manufacturing for clinical and commercial supply of our product candidates. We have a 2,700-square foot clinical cGMP facility at our original corporate location in South San Francisco, California, which we have used to produce clinical supply. We have a second facility in South San Francisco to support research and development and future manufacturing of Nkarta’s cell therapy products and product candidates, including potential needs for pivotal clinical trials and commercial launch. In addition to housing a 12,500-square foot cGMP facility, the second site also serves as our headquarters with office space and research facilities. We currently manufacture clinical supply of NKSTIM cells and the gamma-retrovirus at third-party contract manufacturing sites. We may manufacture NKSTIM cells in house in the future.

Compliance with government regulations related to the manufacture of our product candidates may require significant effort and financial resources. The design, construction, qualification and regulatory approvals for our cGMP manufacturing facilities require substantial capital and technical expertise. The facilities will be subject to inspection by the FDA and other regulatory agencies to ensure compliance with cGMP. Any delays in receiving regulatory approvals for our manufacturing facilities or any failure by us to comply with applicable regulations at our manufacturing facilities could delay our development and commercialization activities. In addition, if our product candidates fail to meet the required specifications after manufacture or if we change the manufacturing process, we may need to obtain additional regulatory approvals. If we are not able to obtain the necessary additional regulatory approvals, we may need to perform additional clinical trials or manufacturing runs or further refine our manufacturing processes, which could delay development and commercialization of our product candidates and cost substantial additional capital. Any delays in our development and commercialization activities could have a material effect on our business, financial position, results of operations and competitive position.

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Patents, Trademarks and Proprietary Technology

We protect our intellectual property rights and proprietary technology with a combination of patent rights that we own or license in certain fields of use, trademark rights, confidentiality procedures and contractual provisions. We seek not only to protect our intellectual property rights and proprietary technology in select key global markets, but also to supplement our intellectual property portfolio with new filings and applications to enhance such protection and support commercialization of current and future product candidates. To that end, we continue to seek protection for our technological innovations and branding efforts by filing new patent and trademark applications when and where appropriate. Our patent portfolio consists of a combination of issued patents and pending patent applications licensed from third parties, jointly owned by us with third parties, and owned solely by us. For example, some of our issued patents and patent applications are exclusively licensed to us in therapeutic fields of use from the National University of Singapore ("NUS"), St. Jude Children’s Research Hospital, Inc., or both (collectively, "Licensors"). As of December 31, 2025, our patent portfolio includes at least 55 issued utility patents and at least 200 pending utility patent applications, which are solely owned by us, jointly owned with others, or licensed to us. Our portfolio includes patents and patent applications that relate to NKX019, our NK cell engineering platform (e.g., NK cell expansion and/or persistence), potential future pipeline product candidates, and alternative technologies.

At least 30 of the issued utility patents and at least 50 of the pending utility patent applications in our portfolio are related to our NKX019 product candidate, and include composition-of-matter, manufacturing process, and method-of-use claims (e.g., targeting CD19-expressing cells, including monotherapies and combination therapies). These issued utility patents include patents in the United States, Europe, Japan, and other jurisdictions outside the United States and are solely owned by us or licensed from Licensors. These pending utility patent applications include applications in the United States, Europe, Japan, the Patent Cooperation Treaty, and other jurisdictions outside the United States. Of these pending patent applications, at least 45 are solely owned by us, with the remaining licensed from Licensors. The estimated expiration dates of the issued utility patents are between approximately 2024 and 2040, and the estimated expiration dates of the pending utility patent applications, to the extent they issue as patents or are used to establish nonprovisional patent applications that issue as patents, are between approximately 2024 and 2046, with estimated expiration dates subject to any patent term adjustments or extensions. Among these issued utility patents and pending utility patent applications, we have three issued US patents and one pending U.S. patent application with composition-of-matter claims directed to our NKX019 product candidate, all of which are solely owned by us and are estimated to expire in 2040, subject to any patent term adjustments or extensions.

At least 20 of the issued utility patents and at least 15 of the pending utility patent applications in our portfolio are related to our NK cell engineering platform, and include manufacturing process, method-of-use and composition-of-matter claims relating to NK cell expansion and/or NK cell persistence. These issued utility patents include patents in the United States, Europe, Japan, and other jurisdictions outside the United States and are solely owned by us or licensed from Licensors. These pending utility patent applications include applications in the United States, Europe, Japan, and other jurisdictions outside the United States. Of these pending patent applications, at least 10 are solely owned by us, with the remaining licensed from Licensors. The estimated expiration dates of the issued utility patents are between approximately 2024 and 2040, and the estimated expiration dates of the pending utility patent applications, to the extent they issue as patents or are used to establish nonprovisional patent applications that issue as patents, are between approximately 2024 and 2045, with estimated expiration dates subject to any patent term adjustments or extensions. Composition-of-matter claims relating to our NKSTIM cells are estimated to have expired in Q4 2024, subject to any patent term adjustments or extensions.

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In August 2016, we entered into a license agreement with the Licensors. Pursuant to this license, the Licensors granted to us an exclusive, worldwide, royalty-bearing, sublicensable license under specified patents and patent applications related to NK cell technology in the field of therapeutics. Payments to the Licensors pursuant to the license agreement include single-digit royalty payments on commercial sales, a portion of any sublicensing revenue, patent expenses, license maintenance fees and milestone payments upon completion of certain regulatory and commercial milestones related to the clinical development and commercialization of our product candidates, in an aggregate amount of up to 5 million Singapore Dollars. The License Agreement also includes certain performance objectives which obligate us to meet various milestones related to the clinical development and commercialization of our product candidates over time for up to 120 months after the effective date of the License Agreement. The term of the license agreement extends until expiration of the last of the patent rights licensed to us by the Licensors, which is currently expected to occur in approximately 2039, subject to any patent term adjustments or extensions. We may terminate the license agreement at will upon 90 days’ prior written notice to the Licensors. The Licensors may terminate the license agreement for certain conditions such as uncured material breach by us, the cession of our business, or our insolvency, liquidation, or receivership.

The U.S. government has certain rights in some of our licensed patents (including U.S. Patent Nos. 7,435,596, 8,026,097, and 11,673,937 and certain related U.S. patent applications, which relate to our NK cell engineering platform) in accordance with the Bayh-Dole Act of 1980. These rights in certain technology developed under government-funded research include, for example, a license to use those inventions for governmental purposes and the right to require us to grant exclusive licenses to such inventions to a third party under certain circumstances. In addition, the U.S. government requires that any products embodying any of these inventions or produced through the use of any of these inventions be manufactured substantially in the United States unless domestic manufacture is not feasible or the requirement is waived. For further details about risks related to the government’s rights in such inventions, see “—The U.S. government could choose to exercise certain rights in technology developed under government-funded research, which could eliminate our exclusive use of such technology or require us to commercialize our product candidates in a way we consider sub-optimal” in the section titled “Risk Factors” in Part I, Item 1A in this Annual Report on Form 10-K.

Our continuing research and development activities, technical expertise and contractual arrangements supplement our existing intellectual property protection and help us maintain our competitive position, and we rely on trade secrets to protect our proprietary information and technologies, especially where we do not believe patent protection is appropriate or obtainable, or where such patents would be difficult to enforce. In order to maintain such trade secrets and other proprietary information, we rely in part on confidentiality agreements with our employees, consultants, contractors, outside scientific collaborators and other advisors.

We also protect our brand through trademark rights. As of December 31, 2025, we are the listed owner of the U.S. registered trademark, NKARTA, and 15 related foreign registered trademarks. In addition, we have pending U.S. trademark applications for NKSTIM and NTRUST. In order to supplement the protection of our brand, we also have registered internet domain names.

Government Regulation

Government authorities in the United States, at the federal, state and local level, and in other countries and jurisdictions, extensively regulate, among other things, the research, development, testing, manufacture, quality control, approval, packaging, storage, recordkeeping, labeling, advertising, promotion, distribution, marketing, post-approval monitoring and reporting, and import and export of pharmaceutical products.

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FDA Approval Process

In the United States, the FDA regulates investigational drugs, including biological products, under the Federal Food, Drug, and Cosmetic Act ("FDCA") and its implementing regulations. Marketing authorization of a biological product via a biologics license application ("BLA") occurs under section 351 of the Public Health Service Act ("PHSA"). The steps required before a product candidate may be approved for marketing in the United States generally include:

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preclinical laboratory tests and animal tests conducted under Good Laboratory Practices;

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the submission to the FDA of an IND for human clinical testing, which must become effective before human clinical trials commence;

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approval by an independent institutional review board ("IRB") representing each clinical site before each clinical trial may be initiated;

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adequate and well-controlled human clinical trials to establish the safety and efficacy of the product for each indication and conducted in accordance with Good Clinical Practices ("GCP");

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the preparation and submission to the FDA of a BLA;

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FDA acceptance, review and approval of the BLA, which might include an advisory committee review; and

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satisfactory completion of an FDA inspection of the manufacturing facilities at which the product, or components thereof, are made to assess compliance with cGMPs and in the case of cell-based advanced therapy, additionally, current Good Tissue Practices.

The testing and approval process typically requires many years and substantial effort and financial resources, and the receipt and timing of any approval is uncertain. The actual time required may vary substantially based upon the type, complexity, and novelty of the product or disease, along with events outside our control, such as reductions in the FDA’s budget, employees and operations. For example, the FDA has, at times, taken longer than its usual 30-day window to complete its review of certain first-of kind INDs. In addition, the FDA may suspend clinical trials at any time on various grounds, including a finding that the subjects or patients are being exposed to an unreasonable and significant health risk.

Preclinical and Human Clinical Trials in Support of a BLA

Preclinical studies generally include laboratory evaluations of product chemistry, formulation, and toxicity, as well as animal studies to assess the potential safety and bioactivity of the product candidate. The results of the preclinical studies, together with manufacturing information and analytical data, among other things, are submitted to the FDA as part of the IND, which must become effective before clinical trials may be commenced. The IND will typically become effective automatically 30 days after receipt by the FDA, unless the FDA raises concerns or questions about the conduct of the trials as outlined in the IND prior to that time. In this case, the IND sponsor and the FDA must resolve any outstanding concerns before clinical trials can proceed. If outstanding concerns cannot be resolved, the FDA will place the clinical trial, or a portion of it, on clinical hold. The FDA may also initiate a full or partial clinical hold after the 30 days if, for example, significant public health risks arise during the trial, if FDA believes the study is not being conducted in accordance with FDA regulations, or if results from additional preclinical studies are required by the FDA to evaluate the potential risk and benefit to patients for such a trial. Clinical holds may be temporary or permanent.

Clinical trials involve the administration of the product candidate to human subjects under the supervision of qualified investigators in accordance with federal regulations, in compliance with GCP requirements, and in accordance with a protocol submitted to FDA as part of the IND detailing the objectives of the trial, the parameters used to monitor safety, and the effectiveness criteria, if any, to be evaluated. Each clinical trial and informed consent information must also be reviewed and approved by an independent IRB at each of the sites at which the trial will be conducted. The IRB will consider, among other things, ethical factors, the safety of human subjects and the possible liability of the institution. An IRB may also require the clinical trial at the site to be halted, either temporarily or permanently, for failure to comply with the IRB’s requirements, or may impose other conditions if it believes that

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the patients are subject to unacceptable risk. Additionally, an independent group of qualified experts organized by the clinical trial sponsor, often known as a Data Safety Monitoring Board ("DSMB") or committee, may oversee some clinical studies.

Clinical trials to support BLAs for marketing approval are typically conducted in three sequential phases prior to approval, but the phases may overlap or be combined. These phases generally include the following:

Phase 1. Phase 1 clinical trials represent the initial introduction of a product candidate into human subjects. In Phase 1 trials of cellular therapies, the product candidate is tested for safety, including adverse effects.

Phase 2. Phase 2 clinical trials usually involve studies in a limited patient population to (i) evaluate the efficacy of the product candidate for specific indications, (ii) determine dosage tolerance and optimal dosage and (iii) identify possible adverse effects and safety risks.

Phase 3. If a product candidate is found to be potentially effective and to have an acceptable safety profile in Phase 2 clinical trials, the clinical trial program will be expanded to Phase 3 clinical trials to further demonstrate clinical efficacy, optimal dosage and safety within a larger number of patients, typically at geographically dispersed clinical trial sites.

Phase 4 (post-approval). Phase 4 clinical trials may be conducted after approval to gain additional experience from the treatment of patients in the intended therapeutic indication and to document a clinical benefit in the case of drugs approved under accelerated approval regulations, or when otherwise requested by the FDA (post-approval commitments) or required by the FDA (post-approval requirements). Failure to promptly conduct any required Phase 4 clinical trials could result in enforcement action or withdrawal of approval.

A pivotal trial is a clinical trial that is designed to meet regulatory requirements to demonstrate a product candidate’s safety and efficacy to support the approval of the drug or biologic. Generally, pivotal trials are Phase 3 trials, but the FDA may accept results from any phase clinical trial if the design provides a well-controlled and reliable assessment of clinical benefit, particularly in situations in which there is an unmet medical need and the results are sufficiently robust.

Submission and Review of a BLA

The results of preclinical studies and clinical trials, together with detailed information on the product’s manufacture, composition, quality, controls and proposed labeling, among other things, are submitted to the FDA in the form of a BLA, requesting approval to market the product. The cost of preparing and submitting a BLA is substantial and requires payment of a significant user fee to the FDA. The FDA has 60 days from its receipt of a BLA to determine whether the application will be accepted for filing based on the FDA’s determination that it is adequately organized and sufficiently complete to permit substantive review. The FDA has substantial discretion in the approval process and may refuse to accept an application or decide that the data are insufficient for approval and require additional preclinical, clinical or other studies.

Once a BLA has been accepted for filing, the FDA sets a user fee goal date that informs the applicant of the specific date by which the FDA intends to complete its review, which is typically ten months from the date that the FDA accepts the BLA for filing for standard review BLAs. Applications classified as priority review are reviewed within six months of the date the FDA accepts the BLA for filing. A BLA can be classified for priority review when the FDA determines the biologic product has the potential to treat a serious or life-threatening condition and, if approved, would be a significant improvement in safety or effectiveness compared to available therapies. The review process can be extended by FDA requests for additional information or clarification. The FDA reviews BLAs to determine, among other things, whether the proposed product is safe and effective for its intended use, whether the product is being manufactured in accordance with cGMP to assure and preserve the product’s identity, strength, quality and purity, and whether the sponsor and clinical trial sites comply with GCP. The FDA may also refer applications for novel biologic products, or biologic products that present difficult questions of safety or efficacy, to be reviewed by an advisory committee—typically a panel that includes clinicians, statisticians and other

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experts—for review, evaluation, and a recommendation as to whether the BLA should be approved. The FDA is not bound by the recommendation of an advisory committee, but generally follows such recommendations.

The FDA will provide a preliminary determination as to whether a REMS is necessary to assure the safe use of the product prior to the BLA, but a final decision will be made during the approval process. If the FDA concludes a REMS is needed, the sponsor of the application must submit a proposed REMS, and the FDA will not approve the application without an approved REMS, if required. A REMS can include medication guides, communication plans for healthcare professionals, and elements to assure a product’s safe use, such as special training or certification for prescribing or dispensing the product, dispensing the product only under certain circumstances, special monitoring, and the use of patient-specific registries. A REMS can substantially increase the costs of obtaining approval. The FDA could also require a special warning, known as a boxed warning, to be included in the product labeling in order to highlight a particular safety risk. The FDA may require substantial post-marketing testing and surveillance to monitor safety or efficacy of a product.

On the basis of the FDA’s evaluation of the BLA and accompanying information, including the results of the inspection of the manufacturing facilities, the FDA will issue either an approval of the BLA or a Complete Response Letter, detailing the deficiencies in the submission and the additional testing or information required for reconsideration of the application. The FDA typically reviews resubmissions within two or six months, depending on the type of information included. Even with submission of this additional information, the FDA may ultimately decide that the application does not satisfy the regulatory criteria for approval. If, or when, those deficiencies have been addressed to the FDA’s satisfaction in a resubmission of the BLA, the FDA will issue an approval letter. An approval letter authorizes commercial marketing and distribution of the biologic with specific prescribing information for specific indications.

Once granted, product approvals may need be withdrawn if compliance with regulatory standards is not maintained or problems are identified following initial marketing. Changes to some of the conditions established in an approved BLA, including changes in indications, product labeling, manufacturing processes or facilities, require submission and FDA approval of a new BLA or BLA supplement before the change can be implemented. A BLA supplement for a new indication typically requires clinical data similar to that in the original application, and the FDA follows the same procedures, including timelines, and actions in reviewing BLA supplements as it does in reviewing BLAs.

Expedited Approval Programs

A sponsor may seek approval of its drug candidate under programs designed to accelerate FDA’s review of INDs and BLA. For example, the FDA may grant fast track designation ("FTD") to a drug intended for treatment of a serious or life-threatening disease or condition that has potential to address unmet medical needs for the disease or condition. The key benefits of FTD are the eligibility for priority review, rolling review (submission of portions of an application before the complete marketing application is submitted) and accelerated approval, if the application meets relevant criteria.

In addition, a sponsor may seek a FDA IND designation of its drug candidate as a breakthrough therapy if the drug can, alone or in combination with one or more other drugs, treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. A breakthrough therapy designation ("BTD") allows companies to work earlier, more closely, and frequently with the FDA, and they may be eligible for priority review and accelerated approval. The sponsor of a new biologic product candidate may request that the FDA designate the candidate for a specific indication as a breakthrough therapy concurrent with, or after, the submission of the IND for the biologic product candidate. The FDA must determine if the biological product qualifies for BTD within 60 days of receipt of the sponsor’s request.

Cell-based advanced therapies intended to treat, modify, reverse or cure a serious medical condition can receive regenerative medicine advanced therapy ("RMAT") designation from the FDA once preliminary clinical evidence has been obtained demonstrating the therapy has the potential to address unmet medical needs for the

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condition. Similar to BTD, the RMAT allows companies developing regenerative medicine therapies to work earlier, more closely, and frequently with the FDA, and RMAT designated products may be eligible for priority review and accelerated approval. 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. The timing of a sponsor’s request for designation and FDA response are the same as for the breakthrough therapy designation program.

Special Protocol Assessment

A company may reach an agreement with the FDA under the Special Protocol Assessment ("SPA") process as to the required design and size of clinical trials intended to form the primary basis of an efficacy claim. Under the FDCA and FDA guidance implementing the statutory requirement, an SPA is generally binding upon the FDA except in limited circumstances, such as if the FDA identifies a substantial scientific issue essential to determining safety or efficacy after the clinical trial begins, public health concerns emerge that were unrecognized at the time of the protocol assessment, the sponsor and the FDA agree to the change in writing, or if the clinical trial sponsor fails to follow the protocol that was agreed upon with the FDA.

Disclosure of Clinical Trial Information

Sponsors of clinical trials of FDA-regulated products, including biological products, are required to register and disclose certain clinical trial information on the website www.clintrials.gov. Information related to the product, patient population, phase of investigation, trial sites and investigators, and other aspects of a clinical trial are then made public as part of the registration. Sponsors are also obligated to disclose the results of their clinical trials after completion. Disclosure of the results of clinical trials can be delayed in certain circumstances for up to two years after the date of completion of the trial. The U.S. National Institutes of Health’s ("NIH") Final Rule on ClinicalTrials.gov registration and reporting requirements became effective in 2017, and both NIH and FDA have signaled the government’s willingness to begin enforcing those requirements against non-compliant clinical trial sponsors, which can give rise to civil monetary penalties and also prevent the non-compliant party from received future grant funds from the federal government.

Orphan Drugs

Under the Orphan Drug Act, the FDA may grant orphan designation to a drug intended to treat a rare disease or condition affecting fewer than 200,000 individuals in the United States, or in other limited cases. Orphan drug designation ("ODD") must be requested before submitting a BLA. If the FDA grants ODD, the identity of the biological product and its potential orphan disease use are disclosed publicly by the FDA. ODD does not convey any advantage in or shorten the duration of the regulatory review and approval process, though companies developing orphan drugs may be eligible for certain incentives, including tax credits for qualified clinical testing. In addition, a BLA for a product that has received ODD is not subject to a prescription drug user fee unless the application includes an indication other than the rare disease or condition for which the drug was designated. In December 2021, we announced that the FDA granted ODD to our product candidate NKX101 for treatment of acute myeloid leukemia. Generally, if a product that has ODD subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications to market the same active moiety for the same indication for seven years, except in limited circumstances, such as another drug’s showing of clinical superiority over the drug with orphan exclusivity. A product can be considered clinically superior if it is safer, more effective or makes a major contribution to patient care.

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Additional Controls for Biologics

To help reduce the increased risk of the introduction of adventitious agents, the PHSA emphasizes the importance of manufacturing controls for products whose attributes cannot be precisely defined. The PHSA also provides authority to the FDA to immediately suspend biologics licenses in situations where there exists a danger to public health, to prepare or procure products in the event of shortages and critical public health needs, and to authorize the creation and enforcement of regulations to prevent the introduction or spread of communicable diseases within the United States.

After a BLA is approved, the product may also be subject to official lot release as a condition of approval. As part of the manufacturing process, the manufacturer is required to perform certain tests on each lot of the product before it is released for distribution. If the product is subject to official release by the FDA, the manufacturer submits samples of each lot of product to the FDA together with a release protocol showing a summary of the lot manufacturing history and the results of all of the manufacturer’s tests performed on the lot. The FDA may also perform certain confirmatory tests on lots of some products, such as viral vaccines, before allowing the manufacturer to release the lots for distribution. In addition, the FDA conducts laboratory research related to the regulatory standards on the safety, purity, potency, and effectiveness of biological products. As with drugs, after approval of a BLA, biologics manufacturers must address any safety issues that arise, are subject to recalls or a halt in manufacturing, and are subject to periodic inspection after approval.

Biosimilars

The Biologics Price Competition and Innovation Act of 2009 ("BPCIA") creates an abbreviated approval pathway for biological products shown to be highly similar to or interchangeable with an FDA licensed reference biological product. Biosimilarity sufficient to reference a prior FDA-approved product requires that there be no differences in conditions of use, route of administration, dosage form, and strength, and no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and potency. Biosimilarity must be shown through analytical trials, animal trials, and a clinical trial or trials, unless the Secretary of Health and Human Services waives a required element. A biosimilar product may be deemed interchangeable with a previously approved product if it meets the higher hurdle of demonstrating that it can be expected to produce the same clinical results as the reference product and, for products administered multiple times, the biologic and the reference biologic may be switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biologic. To date, a small number of biosimilar products and no interchangeable products have been approved under the BPCIA. Complexities associated with the larger, and often more complex, structures of biological products, as well as the process by which such products are manufactured, pose significant hurdles to biosimilar product implementation, which is still being evaluated by the FDA.

A reference biologic is granted 12 years of exclusivity from the time of first licensure, or BLA approval, of the reference product, and no application for a biosimilar can be submitted for four years from the date of licensure of the reference product. The first biologic product submitted under the biosimilar abbreviated approval pathway that is determined to be interchangeable with the reference product has exclusivity against a finding of interchangeability for other biologics for the same condition of use for the lesser of (i) one year after first commercial marketing of the first interchangeable biosimilar, (ii) 18 months after the first interchangeable biosimilar is approved if there is no patent challenge, (iii) 18 months after resolution of a lawsuit over the patents of the reference biologic in favor of the first interchangeable biosimilar applicant, or (iv) 42 months after the first interchangeable biosimilar’s application has been approved if a patent lawsuit is ongoing within the 42-month period.

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Post-Approval Requirements or Commitments

Approved drugs and biologics that are manufactured or distributed in the United States pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to recordkeeping, periodic reporting, adverse event reporting, product sampling and distribution, advertising and promotion including standards and regulations for direct-to-consumer advertising, off label promotion, industry-sponsored scientific and educational activities and promotional activities involving the Internet. The FDA may also impose a number of post-approval requirements or commitments as a condition of approval of a BLA.

In addition, entities involved in the manufacture and distribution of approved drugs are required to register their establishments with the FDA and state agencies and are subject to periodic unannounced inspections by the FDA and these state agencies for compliance with cGMP requirements. Changes to the manufacturing process are strictly regulated and often require prior FDA approval before being implemented. FDA regulations also require investigation and correction of any deviations from cGMP requirements and impose reporting and documentation requirements upon the sponsor and any third party manufacturers that the sponsor may decide to use.

Once an approval is granted, the FDA may issue enforcement letters or product approvals may need to be withdrawn if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market, which could delay product distribution. Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in, among other things, revisions to the approved labeling to add new safety information, imposition of post-market studies or clinical trials to assess new safety risks or imposition of distribution or other restrictions under a REMS program.

The FDA strictly regulates marketing, labeling, advertising and promotion of products that are placed on the market. Drugs may be promoted only for the approved indications and in accordance with the provisions of the approved labeling.

Foreign Regulation

In order to market any product outside of the United States, we would need to comply with numerous and varying regulatory requirements of other countries and jurisdictions regarding quality, safety and efficacy and governing, among other things, clinical trials, marketing authorization, commercial sales and distribution of our products. Whether or not we obtain FDA approval for a product, we would need to obtain the necessary approvals by the comparable foreign regulatory authorities before we can commence clinical trials or marketing of the product in foreign countries and jurisdictions. Although many of the issues discussed above with respect to the United States apply similarly in the context of the European Union and other geographies, the approval process varies between countries and jurisdictions and can involve additional product testing and additional administrative review periods. The time required to obtain approval in other countries and jurisdictions might differ from and be longer than that required to obtain FDA approval. Regulatory approval in one country or jurisdiction does not ensure regulatory approval in another, but a failure or delay in obtaining regulatory approval in one country or jurisdiction may negatively impact the regulatory process in others.

Coverage, Reimbursement and Pricing

In the United States and foreign markets, sales of any products for which we receive regulatory approval for commercial sale will depend, in part, on the availability of coverage and the adequacy of reimbursement from third-party payors. Third-party payors include government authorities and private entities, such as managed care organizations, private health insurers and other organizations. The process for determining whether a third-party payor will provide coverage for a product may be separate from the process for setting the reimbursement rate that the payor will pay for the product. Third-party payors may limit coverage to specific products on an approved list, or formulary, which might not include all of the FDA-approved products for a particular indication. Moreover, a third-party payor’s decision to provide coverage for a product does not imply that an adequate reimbursement rate will be approved. For example, the payor’s reimbursement payment rate may not be adequate or may require co-payments

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that patients find unacceptably high. Additionally, coverage and reimbursement for products can differ significantly from payor to payor. Adequate third-party reimbursement may not be available to enable us to maintain price levels sufficient to realize an appropriate return on our investment in product development. Further, some third-party payors may require pre-approval of coverage for new or innovative devices or drug therapies before they provide reimbursement for use of such therapies.

Third-party payors are increasingly challenging the price and examining the medical necessity and cost-effectiveness of products and services, in addition to their safety and efficacy. To obtain coverage and reimbursement for any product that might be approved for sale, we may need to conduct expensive pharmaco-economic studies to demonstrate the medical necessity and cost-effectiveness of our product. These studies will be in addition to the studies required to obtain regulatory approvals. If third-party payors do not consider a product to be cost-effective compared to other available therapies, they may not cover the product after approval as a benefit under their plans or, if they do, the level of payment may not be sufficient to allow a company to sell its products at a profit. Even if we attain favorable coverage and reimbursement status for one or more products for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

U.S. and foreign governments regularly consider reform measures that affect healthcare coverage and costs. The focus on cost containment measures, particularly in the United States, has increased and we expect will continue to increase the pressure on pharmaceutical pricing. For example, the U.S. and state legislatures have shown significant interest in implementing cost containment programs to limit the growth of government-paid health care costs, including price controls, restrictions on reimbursement and requirements for substitution of generic products for branded prescription products. The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (collectively, the "ACA") contains provisions that may reduce the profitability of products, including, for example, increased rebates for products sold to Medicaid programs, extension of Medicaid rebates to Medicaid managed care plans, mandatory discounts for certain Medicare Part D beneficiaries and annual fees based on pharmaceutical companies’ share of sales to federal health care programs. The Centers for Medicare and Medicaid Services ("CMS") may develop new payment and delivery models, such as bundled payment models. Adoption of government controls and measures, and tightening of restrictive policies in jurisdictions with existing controls and measures, could limit payments for our products. Due to general uncertainty in the current regulatory and healthcare policy environment, and specifically regarding positions that the new Presidential administration may take with respect to these issues, we are unable to predict the impact of any legislative, regulatory, third-party payer or policy actions, including potential cost containment and healthcare reform measures.

European Union Coverage Reimbursement and Pricing

In the European Union, pricing and reimbursement schemes vary widely from country to country. Some countries provide that drug products may be marketed only after a reimbursement price has been agreed. Some countries may require the completion of additional studies that compare the cost effectiveness of a particular drug candidate to currently available therapies in order to obtain reimbursement or pricing approval.

For example, the European Union provides options for its member states to restrict the range of drug products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. European Union member states may approve a specific price for a drug product or may instead adopt a system of direct or indirect controls on the profitability of the company.

Healthcare Laws and Regulations

Physicians, other healthcare providers, and third-party payors will play a primary role in the recommendation and prescription of any product candidates for which we obtain marketing approval. Our arrangements with healthcare professionals, principal investigators, consultants, customers and third-party payors are and will be subject to various federal, state and foreign fraud and abuse laws and other healthcare laws and regulations. The U.S. federal and state healthcare laws and regulations that may affect our ability to operate include, without limitation, the following:

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The federal Anti-Kickback Statute, which prohibits persons from, among other things, knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under federally funded healthcare programs, such as Medicare and Medicaid. The term “remuneration” has been broadly interpreted to include anything of value;

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The federal civil and criminal false claims laws, including, without limitation, the federal civil monetary penalties law and the civil False Claims Act (which can be enforced by private citizens through qui tam actions), prohibit individuals or entities from, among other things, knowingly presenting, or causing to be presented, false or fraudulent claims for payment of federal funds, and knowingly making, or causing to be made, a false record or statement material to a false or fraudulent claim to avoid, decrease or conceal an obligation to pay money to the federal government;

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The federal Health Insurance Portability and Accountability Act of 1996 ("HIPAA") which creates federal criminal laws that prohibit, among other things, executing or attempting to execute a scheme to defraud any healthcare benefit program knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement in connection with the delivery of or payment for healthcare benefits, items or services;

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HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 and its implementing regulations, which imposes certain obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information without the appropriate authorization by entities subject to the law, such as certain healthcare providers, health plans and healthcare clearinghouses and their respective business associates who use, disclose, store or otherwise process HIPAA-protected health information on their behalf;

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The federal transparency requirements under the Physician Payments Sunshine Act, created under the ACA, which requires certain manufacturers of drugs, devices, biologics and medical supplies reimbursed under Medicare, Medicaid or the Children’s Health Insurance Program ("CHIP") to report to the Department of Health and Human Services ("HHS") information related to payments and other transfers of value provided to physicians and teaching hospitals and physician ownership and investment interests;

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Analogous state laws and regulations, such as state anti-kickback and false claims laws, that impose similar restrictions and may apply to items or services reimbursed by non-governmental third-party payors, including private insurers;

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State laws that require pharmaceutical companies to implement compliance programs, comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government, or to track and report gifts, compensation and other remuneration provided to physicians and other health care providers;

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State and local laws requiring the registration of pharmaceutical sales representatives;

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State health information privacy and data breach notification laws, such as the California Consumer Privacy Act and the California Privacy Rights Act, which govern the collection, use, disclosure and protection of health-related and other personal information, many of which differ from each other in significant ways and often are not pre-empted by HIPAA, thus complicating compliance efforts; and

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State unfair and deceptive trade practices statutes, pursuant to which significant statutory fines and penalties can be imposed against pharmaceutical companies alleged to have engaged in consumer fraud.

Recent healthcare reform legislation has strengthened these federal and state healthcare laws. For example, the ACA amends the intent requirement of the federal Anti-Kickback Statute and criminal healthcare fraud statutes to clarify that liability under these statutes does not require a person or entity to have actual knowledge of the statutes or a specific intent to violate them. Moreover, the ACA provides that the government may assert that a claim that includes items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or

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fraudulent claim for purposes of the civil False Claims Act. Government regulators have been very active in the last several years in revising existing regulations and promulgating new regulations, as well as bringing enforcement actions based on these regulations, however it is unclear how and to what extent any challenges and/or reform measures by the new Presidential administration will impact the ACA and our business. 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 we are found to be in violation of these laws, we may be subject to criminal, civil and administrative sanctions including monetary penalties, damages, fines, disgorgement, individual imprisonment, exclusion from participation in government funded healthcare programs, such as Medicare and Medicaid, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of noncompliance with these laws, and reputational harm, in which case we may be required to curtail or restructure our operations. Moreover, we expect that there will continue to be federal and state laws and regulations, proposed and implemented, that could impact our future operations and business.

Healthcare Reform

In the United States, the European Union and other jurisdictions, there have been, and we expect there will continue to be, a number of legislative and regulatory changes and proposed changes to the healthcare system that could affect our results of operations. In particular, there have been and continue to be a number of initiatives at the United States federal and state levels that seek to reduce healthcare costs. For example, in March 2010, the ACA was enacted, which includes measures that have significantly changed the way healthcare is financed by both governmental and private payors. The provisions of the ACA of importance to the pharmaceutical and biotechnology industry are, among others, the following:

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an annual, nondeductible fee on any entity that manufactures or imports certain branded prescription drug agents or biologic agents, which is apportioned among these entities according to their market share in certain government healthcare programs;

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an increase in the rebates a manufacturer must pay under the Medicaid Drug Rebate Program to 23.1% and 13% of the average manufacturer price for branded and generic drugs, respectively;

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

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extension of manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations, unless the drug is subject to discounts under the 340B drug discount program;

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

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expansion of eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to additional individuals and by adding new mandatory eligibility categories for certain individuals with income at or below 133% of the federal poverty level, thereby potentially increasing manufacturers’ Medicaid rebate liability;

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expansion of the entities eligible for discounts under the Public Health Service pharmaceutical pricing program;

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requirements under the federal Physician Payments Sunshine Act for drug manufacturers to report information related to payments and other transfers of value made to physicians and teaching hospitals as well as ownership or investment interests held by physicians and their immediate family members;

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

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creation of the Independent Payment Advisory Board, which, if and when impaneled, will have authority to recommend certain changes to the Medicare program that could result in reduced payments for prescription drugs; and

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

Since its enactment, there have been legislative, judicial, and executive challenges to certain aspects of the ACA, including efforts to repeal or replace all or part of the ACA. Although such attempts to reform the U.S. healthcare system have not significantly impacted our business to date, challenges to the ACA are ongoing and it is unclear how other efforts, if any, to challenge, repeal or replace the ACA, and other healthcare reform measures, will impact our business.

Other federal health reform measures have been proposed and adopted in the United States since the ACA was enacted. These have, among other things, reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers. These new laws or any other similar laws introduced in the future may result in additional reductions in Medicare and other health care funding, which could negatively affect our customers and accordingly, our financial operations.

There have also been a number of proposals in the United States, at both the federal and state level, to control the escalating cost of healthcare, including the cost of drug treatments, patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and we expect that coverage and reimbursement for new therapies will be increasingly restricted. For example, certain states, including California, have implemented state-level cost containment strategies, which could adversely impact adoption of higher-cost medicines that are new to the market. Further, there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which have resulted in several recent Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products. Most significantly, in August 2022, the Inflation Reduction Act of 2022 ("IRA") was signed into law which introduced substantial changes to drug pricing, reimbursement and access support in the United States, including enabling the CMS to assert control over the prices of certain single-source drugs and biotherapeutics reimbursed under Medicare Part B and Part D. The IRA also imposes additional rebates for certain Medicare Part B and Part D drugs where relevant pricing metrics associated with the products increase faster than inflation. The effect of the IRA on our business and the healthcare industry in general is not yet known, but we continue to evaluate its potential impact. At the state level, individual states in the United States have also become increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. In December 2020, the U.S. Supreme Court held unanimously that federal law does not preempt the states’ ability to regulate pharmaceutical benefit managers and other members of the health care and pharmaceutical supply chain, an important decision that may lead to further and more aggressive efforts by states in this area. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs. These measures could reduce the ultimate demand for our products, once approved, or put pressure on our product pricing.

We cannot predict what initiatives may be adopted in the future. Due to general uncertainty in the current regulatory and healthcare policy environment, and specifically regarding positions that the new Presidential administration may take with respect to these issues, we are unable to predict the impact of any legislative, regulatory, third-party payer or policy actions, including potential cost containment and healthcare reform measures. Further federal, state, and regional developments are likely, and we expect ongoing initiatives to increase pressure on drug pricing. These changes may adversely impact the prices we or our future collaborators may charge for our products candidates, if commercialized.

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Additional Regulation

In addition to the foregoing, state and federal laws regarding environmental protection and hazardous substances, including the Occupational Safety and Health Act, the Resource Conservation and Recovery Act and the Toxic Substances Control Act, affect our business. These and other laws govern the use, handling and disposal of various biologic, chemical and radioactive substances used in, and wastes generated by, operations. If our operations result in contamination of the environment or expose individuals to hazardous substances, we could be liable for damages and governmental fines. Equivalent laws have been adopted in foreign countries that impose similar obligations. We may also be subject to climate-related disclosure obligations, either at the federal or state level, including, for example, bills enacted in California in October 2023 which require corporations doing business in California to annually report their greenhouse gas emissions and disclose climate-related financial risks and risk mitigation strategies.

We are also subject to the Foreign Corrupt Practices Act (the "FCPA"), the U.S. domestic bribery statute contained in 18 U.S.C. §201, the U.S. Travel Act, the USA PATRIOT Act, and possibly other state and national anti-bribery and anti-money laundering laws in countries in which we conduct activities. These anti-corruption laws prohibit any U.S. individual or business from paying, offering or authorizing payment or offering of anything of value, directly or indirectly, to any foreign official, political party or candidate for the purpose of influencing any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business. This could become relevant in the conduct of international clinical trials where the sites for such trials may be a government-owned hospital. Activities that violate the FCPA, even if they occur wholly outside the United States, can result in criminal and civil fines, imprisonment, disgorgement, oversight and debarment from government contracts.

Competition

The biopharmaceutical industry in general, and the cell therapy field in particular, is characterized by rapidly advancing and changing technologies, intense competition and a strong emphasis on intellectual property. Our product candidate, NKX019, if approved, may address multiple B-cell driven autoimmune diseases, including lupus nephritis, idiopathic inflammatory myositis, systemic sclerosis, ANCA-vasculitis and others. We face substantial and increasing competition from many different sources, including large and specialty biopharmaceutical companies, academic research institutions, governmental agencies and public and private research institutions. Competitors may compete with us in hiring scientific and management personnel, establishing clinical study sites, recruiting patients to participate in clinical trials, and acquiring technologies complementary to, or necessary for, our programs.

A large number of biopharmaceutical companies are applying their technology and development capabilities to the field of B-cell mediated autoimmune diseases. These companies are pursuing an array of distinct therapeutic approaches that vary by modality and target. Companies developing autologous cell therapies for autoimmune diseases which compete directly with NKX019 include but are not limited to AstraZeneca, Autolus, Bristol-Myers Squibb, Cabaletta, Cartesian, Gilead, iCell, Juventas, JW Therapeutics, Kyverna, Miltenyi, Novartis, Roche, Rui Therapeutics, and Synthekine. Companies developing allogeneic cell therapies intended to treat autoimmune diseases which compete directly with NKX019 include but are not limited to Adicet, Allogene, Artiva, Atara, CRISPR Therapeutics, Fate Therapeutics, TG Therapeutics, and Sana Biotechnology. A number of companies are seeking to harness the biology of immune cells through engagers designed to direct a patient’s own NK or T cells to eliminate B cells. Companies developing cell engagers which compete directly with NKX019 include Amgen, Candid, Cullinan, Dragonfly Therapeutics, GlaxoSmithKline, GT Biopharma, Innate Pharma, Merck, Ouro, Roche, Servier, Xencor, and Zenas. Lastly, a number of companies are developing therapeutic monoclonal antibodies that directly target surface proteins on B cells. Companies developing therapeutic monoclonal antibodies which compete directly with NKX019 include Amgen, Climb Bio, GlaxoSmithKline, Roche, and Zenas. Companies developing in vivo chimeric antigen receptor approaches targeting autoimmune diseases which compete directly with NKX019 include Abbvie, BMS, and Lilly.

Many of our current or potential competitors have significantly greater financial, technical and human resources, as well as more expertise in research and development, manufacturing, preclinical testing, conducting

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clinical studies and trials and commercializing and marketing approved products, than us. Mergers and acquisitions in the biopharmaceutical industry may result in even greater resource concentration among a smaller number of competitors. Smaller or early-stage companies may also prove to be significant competitors, either alone or through collaborative arrangements with large and established companies.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop. Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours, which could result in our competitors establishing a strong market position before we are able to enter the market. The key competitive factors affecting the success of all of our programs are likely to be their efficacy, safety, convenience, price and degree of reimbursement.

Human Capital

We believe that our values – patient first, data driven, intellectually honest, transparent, diverse, inclusive, work/life balance, respectful, humble, creative, and ethical – are the foundations for our team and our behaviors for promoting creativity, innovation and productivity. As of December 31, 2025, we had 108 full-time employees, 28 of whom have advanced degrees including but not limited to Ph.D., M.D. and J.D. degrees. Of these full-time employees, 87 employees are engaged in research and development activities and 21 employees are engaged in finance, business development, human resources, operations and other general and administrative functions. We have no collective bargaining agreements with our employees and we have not experienced any work stoppages. We consider our relations with our employees to be good. However, in March 2025, we executed a reduction in workforce, which may negatively impact our relationship with our employees going forward.

We believe that a performance-based, inclusive work environment is critical for driving innovation and the development of new cell therapies. As part of our comprehensive approach to inclusion at Nkarta, we rely on data to identify gaps, set priorities and enable ongoing assessment of our progress against these principles. We foster an open and collaborative culture based on merit, where talented candidates are considered for opportunities based on their skills, abilities and performance.

Compensation, Benefits and Well-being

We strive to offer fair, market-competitive compensation and benefits that support our employees’ overall well-being. To ensure alignment with our short- and long-term objectives, our compensation programs for all employees include base pay, short-term incentives, and opportunities for long-term incentives. Our well-being and benefit programs focus on four key pillars: physical, emotional, financial and community. We offer a wide array of benefits including comprehensive health insurance, generous time-off and leave, and retirement and financial support.