Kadmon Holdings, Inc. Annual Report 2018
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Kadmon Holdings, Inc. Annual Report 2018 Form 10-K (NYSE:KDMN) Published: March 6th, 2018 PDF generated by stocklight.com UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________________ FORM 10-K _______________________________ (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2017 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For transition period from to . Commission File Number: 001-37841 Kadmon Holdings, Inc. (Exact name of registrant as specified in its charter) _______________________________ Delaware 27‑3576929 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 450 East 29th Street, New York, 10016 NY (Zip Code) (Address of principal executive offices) (212) 308‑6000 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of exchange on which registered Common Stock, par value $0.001 per share The New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None _______________________________ Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ☐ NO ☒ Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. YES ☐ NO ☒ Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ☒ NO ☐ Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). YES ☒ NO ☐ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☒ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non- accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act: Large accelerated Accelerated Non-accelerated Smaller reporting Emerging growth filer ☐ filer ☒ filer ☐ company ☐ company ☒ (Do not check if a smaller reporting company) If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ As of June 30, 2017, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of its voting and non-voting common equity held by non-affiliates was approximately $115,222,352 based upon the closing price of the registrant’s common stock on June 30, 2017. The number of shares of the registrant’s common stock outstanding as of March 2, 2018 was 78,652,149. Kad mon Holdings, Inc. Table of Contents Page P ART I I tem 1. Business 4 I tem 1A. Risk Factors 30 I tem 1B. Unresolved Staff Comments 70 I tem 2. Properties 70 I tem 3. Legal Proceedings 70 I tem 4. Mine Safety Disclosures 70 P ART II I tem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 71 I tem 6. Selected Financial Data 73 I tem 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 74 I tem 7A. Quantitative and Qualitative Disclosures About Market Risk 89 I tem 8. Financial Statements and Supplementary Data 90 I tem 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 90 I tem 9A. Controls and Procedures 90 I tem 9B. Other Information 91 P ART III I tem 10. Directors, Executive Officers and Corporate Governance 92 I tem 11. Executive Compensation 97 Security Ownership of Certain Beneficial Owners and Management and I tem 12. 105 Related Stockholder Matters I tem 13. Certain Relationships and Related Transactions, and Director Independence 109 I tem 14. Principal Accounting Fees and Services 114 P ART IV I tem 15. Exhibits and Financial Statement Schedules 115 I tem 16. Form 10-K Summary 115 S ignatures 168 REF ERENCES TO KADMON In this Annual Report on Form 10-K, unless otherwise stated or the context otherwise requires: · references to the “Company,” “Kadmon,” “we,” “us” and “our” following the date of the Corporate Conversion (July 26, 2016) refer to Kadmon Holdings, Inc. and its consolidated subsidiaries; · references to the “Company,” “Kadmon,” “we,” “us” and “our” prior to the date of the Corporate Conversion refer to Kadmon Holdings, LLC and its consolidated subsidiaries; and · references to the “Corporate Conversion” or “corporate conversion” refer to all of the transactions related to the conversion of Kadmon Holdings, LLC into Kadmon Holdings, Inc., including the conversion of all of the outstanding membership units of Kadmon Holdings, LLC into shares of common stock of Kadmon Holdings, Inc. effected on July 26, 2016. See Note 1, “Organization—Corporate Conversion, Initial Public Offering and Debt Conversion,” of the notes to our audited consolidated financial statements included in this Annual Report on Form 10-K for more information. FORWARD‑LOOKING STATEMENTS This Annual Report on Form 10-K contains forward‑looking statements. All statements other than statements of historical facts contained in this Annual Report on Form 10-K may be forward‑looking statements. Statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, including, among others, statements regarding future capital expenditures and debt service obligations, are forward‑looking statements. In some cases, you can identify forward ‑looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. Forward‑looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward‑looking statements. We believe that these factors include, but are not limited to, the following: · the initiation, timing, progress and results of our preclinical studies and clinical trials, and our research and development programs; · our ability to advance product candidates into, and successfully complete, clinical trials; · our reliance on the success of our product candidates; · the timing or likelihood of regulatory filings and approvals; · our ability to expand our sales and marketing capabilities; · the commercialization of our product candidates, if approved; · the pricing and reimbursement of our product candidates, if approved; · the implementation of our business model, strategic plans for our business, product candidates and technology; · the scope of protection we are able to establish and maintain for intellectual property rights covering our product candidates and technology; · our ability to operate our business without infringing , misappropriating or otherwise violating the intellectual property rights and proprietary technology of third parties; · cost associated with defending or enforcing, if any, intellectual property infringement, misappropriation or · other intellectual property violation, product liability and other claims; · regulatory developments in the United States, Europe and other jurisdictions; · estimates of our expenses, future revenues, capital requirements and our needs for additional financing; · the potential benefits of strategic collaboration agreements and our ability to enter into strategic arrangements; · our ability to maintain and establish collaborations or obtain additional grant funding; · the rate and degree of market acceptance , if any, of our product candidates; · developments relating to our competitors and our industry, including competing therapies; · our ability to effectively manage our anticipated growth; · our ability to attract and retain qualified employees and key personnel; · our ability to achieve cost savings and benefits from our efforts to streamline our operations and to not harm our business with such efforts; · our expectations regarding the period during which we qualify as an emerging growth company under the Jumpstart