Monte Rosa Therapeutics Inc

Item 1A. Risk factors

Investing in our common stock involves a high degree of risk. You should carefully consider the following risks and uncertainties, those risks and uncertainties discussed in Part I, Item 1A, Risk Factors in our 2024 Annual Report, as amended and supplemented by the information in our subsequent Quarterly Reports on Form 10-Q, together with all of the other information contained in this Quarterly Report, including our unaudited condensed consolidated financial statements and the related notes appearing elsewhere in this Quarterly Report. The risk factor disclosure in our 2024 Annual Report and subsequent Quarterly Reports on Form 10-Q is qualified by the information that is described in this Quarterly Report. If any of the risks described below or in our 2024 Annual Report actually occur, our business, prospects, operating results and financial condition could suffer materially. In such event, the trading price of our common stock could decline and you might lose all or part of your investment.

Other than as set forth below, there have been no material changes to the risk factors set forth in our 2024 Annual Report.

We have incurred significant operating losses since our inception and anticipate that we will incur continued losses for the foreseeable future.

Since our inception, we have focused substantially all of our efforts and financial resources on developing our proprietary QuEENTM discovery engine, our proprietary MGD library and our initial pipeline of product candidates. To date, we have financed our operations primarily through the issuance and sale of convertible promissory notes, convertible preferred stock, public offerings of our common stock or warrants to purchase common stock, registered direct offerings, and our collaboration agreements with Roche and Novartis. From our inception through the date hereof, we raised an aggregate of $835.86.0 million of gross proceeds from such transactions. As of March 31June 30, 2025, our cash, cash equivalents, restricted cash and marketable securities were $331.0295.5 million. We have incurred netsignificant operating losses in each year since our inception, and we had an accumulated deficit of $391.7404.0 million as of March 31June 30, 2025. For the years six months ended December 31June 30, 2024 and 20235, we reported net lossesincome of $72.7 million and $135.434.6 million, respectively. For the three monthyears ended MarchDecember 31, 20254 and 20243, we reported a net incomelosses of $46.972.7 million and a net loss of $32.0$135.4 million, respectively. Substantially all of our operating losses have resulted from costs incurred in connection with our research and initial pipeline programs and from general and administrative costs associated with our operations. We expect to continue to incur significant expenses and increasing operating losses over the next several years and for the foreseeable future. Our prior losses, combined with expected future losses, have had and will continue to have an adverse effect on our stockholders deficit and working capital. We expect our expenses to significantly increase in connection with our ongoing activities, as we:

conduct our clinical trial for MRT-2359, our MGD product candidate targeting GSPT1;

finalize our Phase 1 clinical trial for MRT-6160, our MGD candidate targeting VAV1 for immune-mediated conditions and, if applicable, co-fund any global clinical development of Phase 3 onward;

continfinalize our Phase 1 clinical trial for MRT-8102, our NEK7-directed MGD being developed for the treatment of inflammatory conditions driven by the NLRP3 inflammasome, IL-1, and IL-6;

continue preclinical activities for our NEK7, CDK2, CCNE1, and other currently undisclosed programs;

prepare and submit IND applications with the FDA for other current and future product candidates, including for MRT-8102, our MGD product candidate targeting NEK7;

complete preclinical studies for current or future product candidates;

progress MGD molecules from our initial programs through lead optimization to development candidates and multiple areas of interest and indication;

initiate and complete clinical trials for current or future product candidates;

29

expand and improve the capabilities of our QuEENTM discovery engine;

24

continue to build our proprietary library of MGDs;

contract to manufacture our product candidates;

advance research and development related activities to expand our product pipeline;

seek regulatory approval for our product candidates that successfully complete clinical development;

develop and scale up our capabilities to support our ongoing preclinical activities and future clinical trials for our product candidates and commercialization of any of our product candidates for which we may obtain marketing approval;

maintain, expand, and protect our intellectual property portfolio;

hire additional staff, including clinical, scientific and management personnel; and

secure facilities to support continued growth in our research, development and commercialization efforts.

In addition, if we obtain marketing approval for our current or future product candidates, we will incur significant expenses relating to our commercialization of such product candidates via our sales, marketing, product manufacturing and distribution efforts. Because of the numerous risks and uncertainties associated with developing pharmaceutical drugs, including in light of economic fluctuations, we are unable to predict the extent of any future losses or when we will become profitable, if at all.

Even if we achieve profitability, we may not be able to sustain or increase our profitability on a quarterly or annual basis. Our failure to become and remain profitable would depress the value of our company and could impair our ability to raise capital, expand our business, maintain our development efforts, obtain product approvals, diversify our offerings or continue our operations. A decline in the value of our company could also cause you to lose all or part of your investment. 

Significant economic, trade, regulatory,

Preclinical and clinical drug development is a lengthy and expensive process, with an uncertain outcome. Our preclinical and clinical programs may experience delays or may never advance, which would adversely affect our ability to obtain regulatory approvals or commercialize our product candidates on a timely basis or at all, which could have an adverse effect on our business. 

In order to obtain FDA approval to market a new small molecule product, we must demonstrate the safety and efficacy of our product candidates in humans to the satisfaction of the FDA. To meet these requirements, we will have to conduct adequate and well-controlled clinical trials. Clinical testing is expensive, time-consuming and subject to uncertainty. Before we can commence clinical trials for a product candidate, we must complete extensive preclinical studies that support our planned and future INDs in the United States. Other than MRT-2359, which is being evaluated in an ongoing clinical trial, MRT-6160 and MRT-8102, both of which are being evaluated in Phase 1 single ascending dose/multiple ascending dose studies, we are currently selecting lead development candidates for preclinical development. We cannot be certain of the timely completion or outcome of our preclinical studies and cannot predict if the FDA will allow our proposed clinical programs to proceed or if the outcome of our preclinical studies will ultimately support further development of our programs. We cannot be sure that we will be able to submit INDs or similar applications with respect to our other product candidates on the timelines we expect, if at all, and we cannot be sure that submission of an IND or similar applications will result in the FDA or other regulatory authorities allowing clinical trials to begin. 

Conducting preclinical testing and clinical trials represents a lengthy, time-consuming and expensive process. The length of time may vary substantially according to the type, complexity and novelty of the program, and often can be several years or more per program. Delays associated with programs for which we are directly conducting preclinical studies may cause us to incur additional operating expenses. The commencement and rate of completion of preclinical studies and clinical trials for a product candidate may be delayed by many factors, including, for geopoliticexample:

inability to generate sufficient preclinical or other in vivo or in vitro data to support the initiation of clinical studies;

timely completion of preclinical develolaboratory tests, animal studies and formulation studies in accordance with the FDAs good laboratory practice requirements and other applicable regulations;

approval by an independent Institutional Review Board, or IRB, ethics committee at each clinical site before each trial may be initiated;

delays in reaching a consensus with regulatory agencies on study design and obtaining regulatory authorization to commence clinical trials;

30

delays in reaching agreement on accepments, table terms with prospective contract research organizations, or CROs, and other circumstances beyond our control, could have a material effect on our financiclinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and clinical trial sites;

delays in identifying, recruiting and training suitable clinical investigators;

delays in recruiting suitable patients to participate in our clinical trials;

delays in manufacturing, testing, releasing, validating or importing/exporting sufficient stable quantities of our product candidates for use in clinical trials or the inability to do any of the foregoing;

insufficient or inadequate supply or quality of product candidates or other materials necessary for use in clinical trials, or delays in sufficiently developing, characterizing or controlling a manufacturing process suitable for clinical trials;

imposition of a temporary or permanent clinical hold by regulatory authorities;

developments on trials conducted by competitors for related technology that raises FDA or foreign regulatory authority concerns about risk to patients of the technology broadly, or if the FDA or a foreign regulatory authority finds that the investigational protocol or plan is deficient to meet its stated objectives;

delays in recruiting, screening and enrolling patients and delays caused by patients withdrawing from clinical trials or failing to return for post-treatment follow-up;

difficulty collaborating with patient groups and investigators;

failure by our CROs, other third parties or us to adhere to clinical trial protocols;

failure to perform clinical trials in accordance with the FDAs good clinical practice requirements, or GCPs, or applicable regulatory guidelines in other countries;

occurrence of adverse events associated with the product candidate that are viewed to outweigh its potential benefits, or occurrence of adverse events in a trial of the same class of agents conducted by other companies;

changes to the clinical trial protocols;

clinical sites dropping out of a trial;

changes in regulatory requirements and guidance that require amending or submitting new clinical protocols;

changes in the standard of care on which a clinical development plan was based, which may require new or additional trials;

selection of clinical endpoints that require prolonged periods of observation or analyses of resulting data;

the cost of clinical cotrials of our product candidates being greater than we anticipate;

clinical trials of our product candition or resultdates producing negative or inconclusive results, which may result in our deciding, or regulators requiring us, to conduct additional clinical trials of operations.

r abandon development of such product candidates;

transfer of manufacturing processes to larger-scale facilities operated by a contract manufacturing organization, or CMO, and delays or failure by our CMOs or us to make any necessary changes to such manufacturing process; and

third parties being unwilling or unable to satisfy their contractual obligations to us.

Further, conducting clinical trials in foreign countries, as we may do for our product candidates, presents additional risks that may delay completion of our clinical trials. These risks include the failure of enrolled patients in foreign countries to adhere to clinical protocol as a result of differences in healthcare services or cultural customs, managing additional administrative burdens associated with foreign regulatory schemes, as well as political and economic risks relevant to such foreign countries. Delays in the completion of any preclinical studies or clinical trials of our product candidates will increase our costs, slow down our product candidate development and approval process and delay or potentially jeopardize our ability to commence product sales and generate product revenue. In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of our product candidates. Any delays to our preclinical studies or clinical trials that occur as a result could shorten any period during which we may have the exclusive right to commercialize our product candidates and our competitors may be able to bring products to market before we do, and the commercial viability of our product candidates could be significantly reduced. Any of these occurrences may harm our business, financial condition and prospects significantly. 

31

Our business is dependent on the success of our lead programs, and any other product candidates that we advance into the clinic. We cannot be certain that we will be able to obtain regulatory approval for, or successfully commercialize, any of our current or future product candidates.

All of our pipeline programs other than MRT-2359, MRT-6160 and MRT-8102 are currently in preclinical development. The preclinical studies and future clinical trials of our current or future product candidates are, and the manufacturing and marketing of our current or future product candidates will be, subject to extensive and rigorous review and regulation by numerous government authorities in the U.Significant economic, trade, regul. and in other countries where we intend to test or, if approved, market any of our current or future product candidates. Before obtaining regulatory approvals for the commercial sale of any of our current or future product candidates, we must demonstrate through preclinical studies and clinical trials that each product candidate is safe and effective for use in each target indication. Drug development is a long, expensive and uncertain process, and delay or failure can occur at any stage of any of our preclinical studies and clinical trials. This process can take many years and may include post-marketing studies and surveillance, which will require the expenditure of substantial resources beyond the proceeds we raised in our IPO. Of the large number of drugs in development in the U.S., only a small percentage will successfully complete the FDA regulatory, or geopolitical de approval process and will be commercialized, with similarly low rates of success for drugs in development in the European Union obtaining regulatory approval from the European Medicines Agency, or EMA. Accordingly, even if we are able to obtain the requisite financing to continue to fund our development and preclinical studies and clinical trials, we cannot assure you that any of our current or future product candidates will be successfully developments are difficult to predict and may haed or commercialized. 

We are not permitted to market our current or future product candidates in the U.S. until we receive approval of a new drug application, or NDA, from the FDA, or in the European Economic Area, until we receive approval of a marketing authorization application, or an MAA, from the European Commission, or in any other foreign countries until we receive the requisite approval from such countries. Obtaining approval of an NDA or MAA is a complex, lengthy, expensive, and uncertain process, and the FDA or EMA may delay, limit or deny approval of any of our current or future product candidates for many reasons, including, among others:

we may not be able to demonstrate that our current or future product candidates are safe and effective a materiin treating their target indications to the satisfaction of the FDA or applicable foreign regulatory agency;

the results of our preclinical studies and clinical trials may not meet the level of statistical or clinical effect on ussignificance required by the FDA or applicable foreign regulatory agency for marketing approval;

the FDA or applicable foreign regulatory agency may disagree with the number, design, size, conduct or implementation of our preclinical studies and clinical trials;

the FDA or applicable foreign regulatory agency may require that we conduct additional preclinical studies and clinical trials;

we may be unable to demonstrate that a product candidates clinical and other benefits outweigh its safety risks;

the FDA or applicable foreign regulatory agency may not approve the formulation, labeling or specifications of any of our current or future product candidates;

the CROs that we retain to conduct our preclinical studies and clinical trials may take actions outside of our control that materially adversely impact our preclinical studies and clinical trials;

the FDA or applicable foreign regulatory agency may find the data from preclinical studies and clinical trials insufficient to demonstrate that our current or future product candidates clinical and other benefits outweigh their safety risks;

the FDA or applicable foreign regulatory agency may disagree with our interpretation of data from our preclinical studies and clinical trials;

the FDA or applicable foreign regulatory agency may not accept data generated at our preclinical study and clinical trial sites;

if our NDA, if and when submitted, is reviewed by an advisory committee, the FDA may have difficulties scheduling an advisory committee meeting in a timely manner or the advisory committee may recommend against approval of our application or may recommend that the FDA require, as a condition of approval, additional preclinical studies or clinical trials, limitations on approved labeling or distribution and use restrictions;

the FDA may require development of a Risk Evaluation and Mitigation Strategy, or REMS, as a condition of approval or post-approval;

32

the FDA or the applicable foreign regulatory agency may determine that the manufacturing processes or facilities of third-party manufacturers with which we contract do not conform to applicable requirements, including current Good Manufacturing Practices, or cGMPs;

the FDA or applicable foreign regulatory agency may be delayed in their review processes due to staffing or other constraints arising from public health crises; or

the FDA or applicable foreign regulatory agency may change its approval policies or adopt new regulations. 

Any of these factors, many of which are beyond our control, could jeopardize our ability to obtain regulatory approval for and successfully market our current or future product candidates. In addition, the FDA and other applicable foreign regulatory agencies have substantial discretion in the approval process and determining when or whether regulatory approval will be granted for any product candidate that we develop and may decide that our data are insufficient for approval or require additional preclinical, clinical, or other data. The Unit.S. Supreme Courts July 2024 decision to overturn prior established States recently imposecase law giving deference to regulatory agencies interpretations of ambiguous statutory language has introduced uncertainty regarding the extent to which FDAs regulations, policies and decisions may become subject to increasing legal challenges, delays, and/or changes. Any setbacks in our pursuit of regulatory approval would have a material adverse effect on our business and prospects.

Significant economic, trade, regulatory, or geopolitical developments, and other circumstances beyond our control, could have a material effect on our financial condition or results of operations.

Significant economic, trade, regulatory, or geopolitical developments are difficult to predict and may have a material effect on us. The U.S. recently imposed tariffs on virtually all imports to the U.S. and significantly higher reciprocal tariffs applicable to imports from many countries, certain of which reciprocal tariffs were subsequently temporarily paused. If tariffs are broadly imposed it could lead to additional corresponding punitive actions by the countries with which the U.S. trades. Historically, tariffs have led to increased trade and political tensions, between not only the U.S. and China, but also between the U.S. and other countries in the international community. Political tensions could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. Any changes in political, trade, regulatory, and economic conditions , or new legislative and/or regulatory developments, could have a material adverse effect on our financial condition or results of operations. Until we know how such changes may impact our business and the business of our competitors, suppliers and other parties we work with over the long term, we will not know if, overall, we will benefit from them or be negatively affected by them.

2533