AKAO 2017 Annual Report

3 Part I Forward-Looking Statements This Annual Report on Form 10-K, including “Business” in Part I, Item I and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7, contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Annual Report on Form 10-K are statements that could be deemed forward-looking statements reflecting the current beliefs and expectations of management with respect to future events or to our future financial performance and involve known and unknown risks, uncertainties and other 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 these forward-looking statements. These statements are often identified by the use of words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “should,” “estimate,” or “continue,” and similar expressions or variations. The risks and uncertainties referred to above include, without limitation, risks related to our research and development efforts, need for future capital, timely completion of our clinical trials, uncertainty of clinical trial results or regulatory approvals or clearances, manufacturing of our product candidates at scales and costs appropriate for commercialization, enforcement of our patent and proprietary rights, potential competition and other risks that are described herein and that are otherwise described from time to time in our Securities and Exchange Commission (“SEC”) reports including, but not limited to, the factors described in Item 1A, “Risk Factors,” of this Annual Report. Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. Item 1. Business. Overview We are a late-stage biopharmaceutical company passionately committed to the discovery, development, and commercialization of innovative antibacterial treatments against multi-drug resistant (“MDR”) gram-negative infections. We are developing plazomicin, our lead product candidate, for the treatment of serious bacterial infections, due to MDR Enterobacteriaceae, including carbapenem-resistant Enterobacteriaceae (“CRE”). In 2013, the Centers for Disease Control and Prevention (“CDC”) identified CRE as a “nightmare bacteria” and an immediate public health threat that requires “urgent and aggressive action” and in 2017 the World Health Organization (“WHO”) identified CRE as a Global Priority 1 Pathogen: Critical Need for Research and Development of New Antibiotics. Our second antibacterial candidate is C-Scape, an orally-administered combination of clavulanate and ceftibuten, which targets serious bacterial infections due to expanded spectrum beta-lactamases (“ESBL”) producing Enterobacteriaceae. In 2017, the WHO identified ESBL as a Global Priority 1 Pathogen: Critical Need for Research and Development of New Antibiotics. We also have other programs in early and late preclinical stages focused on other MDR gram-negative infections and additional disease areas. On January 2, 2018, we announced the acceptance of a New Drug Application (“NDA”) for substantive U.S. Food and Drug Administration (“FDA”) for plazomicin, seeking approval to treat complicated review to the urinary tract infections (“cUTI”), including acute pyelonephritis (“AP”) and bloodstream infections (“BSI”) due to d certain Enterobacteriaceae in patients who have limited or no alternative treatment options. The NDA is supporte by data from two Phase 3 clinical trials, EPIC (Evaluating Plazomicin In cUTI) and CARE (Combating Antibiotic Resistant Enterobacteriaceae). The FDA has granted the NDA Priority Review as well as set a target action date under the Prescription Drug User Fee Act (“PDUFA”) of June 25, 2018. We expect a commercial launch of plazomicin in the United States in 2018, if our NDA is approved by the PDUFA date. We also intend to submit an application for marketing authorization (“MAA”) in the European Union (“EU”) in 2018. On May 23, 2017, we announced that the FDA granted Breakthrough Therapy designation (“BTD”) for plazomicin for the treatment of BSI caused by certain Enterobacteriaceae in patients who have limited or no alternative treatment options. BTD was created by the FDA to expedite the development and review of drugs that target serious or life-threatening conditions. Plazomicin has also received Qualified Infectious Disease Product (“QIDP”) designation from the FDA, which provides incentives for the development of new antibiotics, including priority review and an extension by an additional five years of any existing non-patent market exclusivity the