Vertex Pharmaceuticals · Risk factors

Prior heading: If we are unable to successfully develop and commercialize additional products, our business could be materially harmed.

We invest significant resources in the research and development of therapies to discover and develop transformative medicines for people with serious diseases and conditions, including CF, SCD, TDT, acute and peripheral neuropathic pain, IgAN, AMKD, T1D, DM1, and ADPKD. diseases. Product development is highly uncertain and expensive. Product candidates that may appear promising in research and development but may fail to reach commercial success for many reasons, including: •the failure to establish safety and efficacy through clinical trials; •the failure to obtain marketing approval for the product candidate; approval; •the inability to manufacture the product candidate on economically feasible terms; •the failure to gain and maintain market acceptance among physicians and patients or other members of the medical community; and community; •the failure to obtain market acceptance or adequate pricing or reimbursement levels from third-party payors or foreign governments for such product. governments; and •competition based on, among other factors, safety, efficacy, patient convenience, pricing and reimbursement. If we are not able to successfully develop and commercialize additional products medicines, our business could would be materially harmed.

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Prior heading: If we are unable to sustain and grow revenues from sales of our CF medicines, our business would be materially harmed and the market price of our common stock would likely decline.

Substantially all of our net product revenues have been derived from the sale of our CF medicines over the last several years. As a result, our business is dependent upon our ability medicines. We may be unable to sustain and or increase revenues from sales of our CF medicines. We seek to continue to increase our CF product revenue through serial innovation, including development and commercialization medicines in the future for any number of next-generation CF medicines, extending access reasons, including the potential introduction of CF medicines competitive products or the inability to younger children with CF, seeking additional approvals for our CF medicines in ex-U.S. markets and securing successfully develop and maintaining adequate reimbursements for our CF commercialize next-generation medications or medicines globally, and by developing a nebulized mRNA therapy for the more than 5,000 to treat people with CF who do not make CFTR protein and cannot benefit from CFTR modulators. our current CF medicines. Our concentrated source of revenues presents a number of revenue increases the risks to our business, including: •that one or more competing therapies may be developed successfully by others as a treatment for people associated with CF; •that reimbursement policies of payors and other third parties may make it difficult to obtain reimbursement or may reduce the net price we receive for our products; •that we may experience potential manufacturing or supply disruptions for our CF medicines; and •that we disruptions, safety issues that may experience adverse developments be identified with respect to development or commercialization of our CF medicines. Our ability to increase our CF product revenues is dependent in part on our ability to successfully commercialize ALYFTREK, our recently approved once-daily CF medicine. We expect the commercial opportunity for ALYFTREK to depend on three types of patients: (i) those who are currently on a CFTR modulator who may want to switch medicines, and failure to ALYFTREK, (ii) those patients who have not yet been initiated on a CFTR modulator gain and/or maintain market acceptance or been eligible adequate pricing or reimbursement for a CFTR modulator, and (iii) those who have discontinued from another CFTR modulator. There can be no assurance that people with our CF will be willing to switch from their current CFTR modulator or initiate treatment with ALYFTREK if they are not currently being treated by a CFTR modulator. medicines. If any of the above risks were to materialize, if we are otherwise unable to sustain or increase revenues from sales of our CF medicines, or if we do not meet the expectations of investors or public equity market analysts, investors, our business would be materially harmed and our ability to fund our operations could be adversely affected.

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Prior heading: If we are unable to successfully develop, obtain approval and commercialize treatments for acute and neuropathic pain, our business could be materially harmed.

We believe that a A portion of the value attributed to our company by investors is based on our approved the expected commercial success of JOURNAVX for acute pain and potential treatments on our development programs for both acute and peripheral neuropathic pain. JOURNAVX, which was approved in January 2025 for moderate-to-severe acute pain in adults, JOURNAVX may not gain or maintain market acceptance among physicians and patients physicians, patients, or other members of the medical community. In addition payors due to various factors, including the risks normally availability of lower-cost alternatives, and sales, marketing, pricing, and/or distribution challenges associated with launching introducing a new branded product, JOURNAVX will need to compete, and obtain reimbursement from third-party payors, in an acute pain market that largely consists of low-cost generic drugs, including opioids, non-steroidal anti-inflammatory drugs, acetaminophen and local anesthetics. Similarly, if product into a highly competitive market. Furthermore, we are successful may not succeed in developing and obtaining approval JOURNAVX for suzetrigine additional indications or in peripheral neuropathic pain, this advancing other product will face competition from generic anticonvulsant and antidepressant drugs. If we are not able to successfully develop and commercialize treatments candidates, including NaV1.8 or NaV1.7 inhibitors, for the treatment of acute and or peripheral neuropathic pain, our future net pain. Even if we obtain marketing approvals for these product revenues and cash flows candidates, they will be adversely affected face significant competition and our business could there can be materially harmed.no assurance of commercial success.

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Prior heading: If we are not successful in commercializing CASGEVY, our revenue growth could be limited and our business could be materially harmed.

We have invested significant resources in the development and commercialization of CASGEVY. While we have previously successfully commercialized several small molecule drugs, we have limited experience with the commercialization of cell and genetic therapies. Manufacturing and commercialization of CASGEVY is subject to similar risks and uncertainties as small molecules. In addition: •the manufacturing process for CASGEVY is more complex than the manufacturing processes for our small molecule medicines and we may encounter difficulties in the production of CASGEVY and ensuring that the product meets required specifications; •there are multiple steps along the CASGEVY patient treatment journey, many of which involve significant clinical complexities performed by third parties, including the collection of blood cells from patients, transfer of those cells to and from a manufacturing facility, and other procedures either before or after delivery of CASGEVY; •the The future commercial success of CASGEVY continues to depend in part depends on the medical community, physicians, patients, governments, and third-party or governmental payors accepting it as a medically useful, cost-effective, ethical, and safe, and preferred with respect to current and potential future competitive therapies, and on payors providing adequate reimbursement; reimbursement. In addition to risks generally associated with the commercialization of medicines, the cell collection processes, manufacturing and •global other procedures required to manufacture and administer CASGEVY are more complex, resource-intensive, and operationally demanding than for small molecules. For example, the cost of manufacturing CASGEVY as a percentage of revenue is significantly higher than for our CF medicines. Moreover, market acceptance continues to be dependent in part on the prevalence and severity of side effects associated with the procedure by which CASGEVY is administered, including the prevalence and severity of any side effects those resulting from the myeloablative preconditioning regime. In addition, there is actual and potential future competition for CASGEVY, including bluebird’s SCD gene therapy, LYFGENIA™, and its TDT gene therapy, ZYNTEGLO™, which are both approved in the U.S. If competing therapies are commercialized, or developed and then commercialized, more successfully by other companies as a treatment for people with SCD or TDT, our future net product revenues and cash flows regime. There can be no assurance that we will be adversely affected and able to increase or maintain our business could be materially harmed If we are not successful revenues from CASGEVY in commercializing CASGEVY, our business could be materially harmed.future periods.

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Prior heading: We may experience pricing pressure on our products, which could reduce our revenues and future profitability.

There also has been an increase Revenues from our products depend, to a large degree, on the extent to which the products are purchased by customers, such as wholesalers, pharmacies, and hospitals, and reimbursed by third-party payors, such as government health programs, commercial insurers, and managed health care organizations. Increasingly, these third-party payors are becoming more critical in state legislation evaluating and regulations related reimbursing medicines. The containment of health care costs continues to drug pricing be a priority for many governments, and drug pricing transparency. In the U.S., various states, including Nevada, Maryland, Louisiana, New York, California, Washington, Massachusetts, New Jersey, Connecticut, Vermont, New Hampshire, Utah, Minnesota, Oregon, Colorado, New Mexico, Virginia, Maine, Texas, North Dakota, West Virginia, Florida, has been a focus in this effort. The U.S. federal government and New Jersey state legislatures and foreign governments have passed legislation requiring companies to disclose extensive information relating to drug prices, drug price increases, shown significant and spending evolving interest in implementing cost-containment programs, including price controls, restrictions on research, development, reimbursement, value-based and marketing, among other things. Although it is not always clear what states will do reference pricing, compulsory licensing, including the pursuit of so- called “march in” rights, and mandatory substitution with generic products, all of which could limit the collected information, some laws were designed prices of, or access to, our products. Decisions by third-party payors to obtain additional not cover a product discounts. Additionally, certain states have enacted laws establishing Prescription Drug Affordability Boards (“PDABs”). Some state PDABs either have the authority or have defined restrict access to a pathway where they product may shift over time and could reduce market acceptance of the product and limit product revenues. We must also compete to be granted placed on formularies of managed care providers, as exclusion of our products from a formulary would limit usage by managed care providers and patients. In the authority U.S., pricing and access is primarily governed by practices of private managed care providers and institutional and governmental purchasers, federal laws and regulations related to establish upper payment limits for prescription drugs, including Colorado, Maryland, Washington, Medicare and Minnesota. Under Medicaid, including the Washington law, ACA and the PDAB cannot select for an affordability review drugs that are solely for IRA, and state activities, including the treatment establishment of an orphan-designated disease or condition. In PDABs and price transparency rules. For example, in August 2023, the Colorado PDAB selected five drugs for an affordability review, including TRIKAFTA; TRIKAFTA. Although the Colorado PDAB later that year, it found TRIKAFTA to be not unaffordable, and thus not eligible ineligible for an upper payment limit. We cannot, however, limit we cannot predict whether future reviews by the Colorado PDAB, or any other PDAB, will come to the same conclusion about TRIKAFTA or any of our other therapies, or the amount of any potential upper payment limit. We may continue to see more state action requiring additional disclosures or other actions. In addition, we could see increased federal activity related Furthermore, changes to drug pricing and transparency requiring disclosures or other actions instead of, or in addition to, state requirements. Similar initiatives also are occurring in, or being considered by, some of our ex-U.S. markets, including Italy and Brazil. Additional state actions, including the importation health care system enacted as part of drugs from other countries, also may affect health care reform in the availability and accessibility U.S., as well as increased purchasing power of our medicines. For example, entities that negotiate on January 5, 2024, the FDA authorized Florida’s Agency for Health Care Administration’s drug importation program under section 804 behalf of the Federal Food, Drug, Medicare, Medicaid, and Cosmetic Act, which eventually would allow Florida to import certain prescription drugs from Canada. The importation of drugs from Canada or other countries that potentially could compete with our medicines private payors, could create increased pressure on our revenue and profitability. Complying with these laws can be expensive and requires significant personnel and operational resources. Furthermore, any additional required discounts would adversely affect the result in further pricing of, and revenues from, our products. Finally, while we seek to comply with all statutory and regulatory requirements, we face increased enforcement activity pressures. For example, initiatives by the U.S. federal government, state governments, and private payors against pharmaceutical and biotechnology companies for government to impose most-favored- nation pricing and reimbursement-related issues as well as inquiries from the on U.S. Congress. Other federal activities seeking to specifically address prescription drug prices in government programs, including the recently proposed GUARD Model by the CMS. While there is significant uncertainty around the related executive orders and rulemaking, mandatory initiatives could result in reduced pricing and reimbursement include: •rulemaking related to importation of prescription drugs from Canada, as well as guidance related to importation of prescription drugs from other foreign countries; •attempts to establish reference pricing for certain physician-administered drugs; •executive orders relating to drug pricing that are intended to broadly impact our products. In most markets outside of the pharmaceutical industry; •changes to U.S., the federal anti-kickback statute safe harbors that eliminate anti-kickback statute discount safe harbor protection for certain manufacturer rebate arrangements; pricing and •legislation relating reimbursement medicines is subject to drug pricing, including enhanced transparency measures into governmental control and governments are making greater efforts to reduce drug pricing. We expect government scrutiny over prices and limit drug pricing, reimbursement, spending. The reimbursement process in ex-U.S. markets vary widely and distribution can take a significant time to continue. Potential future government regulation complete, and reimbursement decisions are made on a country-by- country and region-by-region basis. Reimbursement for our products by governments, including the timing of drug prices any reimbursements, may also be affected by budgetary or political constraints, particularly in challenging economic environments. We have experienced challenges in obtaining timely reimbursement creates uncertainties about for our portfolio products in various countries outside the U.S., and could have a material adverse effect on our operations. Moreover, antitrust and/or competition laws are increasingly being used to scrutinize pricing future revenues depend on high-value medicines maintaining such reimbursement. There is no assurance that coverage and entities involved in drug distribution reimbursement will continue for our current products or reimbursement, including some with whom we do business. Defending against an antitrust be available for our future products. Even if reimbursement is available, there is no assurance that the timing or competition claim can level of reimbursement will be expensive and requires significant personnel and operational resources, may ultimately lead sufficient. Furthermore, many ex-U.S. governments are introducing new legislation focused on cost containment measures applicable to a reduction in the prices pharmaceutical industry; such legislation, if finalized, could lead to lower prices, rebates or other forms of discounts or special taxes. Our failure to obtain or maintain adequate prices, coverage, or reimbursement for our products, and can ultimately result a material products would have an adverse effect on profitability and our business overall. Additionally, governmental efforts to pursue compulsory licensing, including the pursuit business, revenue and results of so-called “march in” rights, operations, could affect curtail or eliminate our pricing strategy ability to adequately fund our research and result development programs and/or could cause a decline or volatility in an adverse impact on our revenue.stock price.

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Prior heading: If our competitors bring products with superior product profiles to market, our products may not be competitive, and our revenues could decline.

A number of companies are seeking to identify Our products and develop product candidates for face or may face competition from existing and potential competing products. See also Item 1., Business – Competition of this Annual Report on Form 10-K. Competing products may be more effective, safer, more effectively marketed, have lower prices or better coverage or reimbursement levels, eliminate or minimize the need for treatment of CF, SCD, TDT, pain, and with our products or product candidates, or have other therapeutic areas differentiating factors that negatively affect the demand for our products or product candidates. If a competitor obtains approval and reimbursement before we are targeting with do, approval and/or reimbursement of our research products or product candidates could be delayed, denied, or otherwise adversely affected. We compete with an array of companies and development activities. Our success in rapidly developing other organizations, including those that have substantially greater resources, more mature development, manufacturing and commercializing our CF medicines commercial organizations, and/or other competitive advantages. Smaller companies with innovative programs or technologies are frequently acquired by and enter into collaborations with larger competitors, which may increase result in the resources that our competitors allocate to acceleration or enhancement of competitive programs. We cannot predict the development timing or impact of potential the introduction of competitive treatments. products. If one or more a competing therapies are product is successfully developed as a treatment and commercialized for people with CF, SCD, TDT, pain or any of the other disease areas a patient population we are currently targeting in our pipeline, our products and our net product revenues could face competitive pressures. If one treating or more competing therapies prove to be superior are seeking to our then-existing products and/or product candidates, treat, our revenues, business or market position could be materially adversely affected. affected. In addition, our business faces competition from major pharmaceutical and biotechnology companies possessing substantially greater financial resources than we possess, as well as from numerous smaller public and private companies, academic institutions, government agencies, public and private research organizations, and charitable venture philanthropy organizations that conduct research, seek patent protection, and/or establish collaborative arrangements for research, development, manufacturing, and commercialization. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources being concentrated among a smaller number release of our competitors. Smaller and other early-stage companies also may prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties compete with us in recruiting and retaining qualified scientific and management personnel, establishing new information, including clinical trial sites data and patient registration for clinical trials, as well as in acquiring technologies complementary to, regulatory approval timelines, by our competitors regarding competitive products or necessary for, potentially competitive product candidates can affect investors’ perceptions regarding the prospects of our programs. Our products and any products that we develop product candidates, and has caused and may in the future may not be able to compete effectively with marketed therapies or new therapies that may be developed by competitors. The risk of competition is particularly important to our company because substantially all of cause our revenues are related stock price to the treatment of people with CF. There are many other companies developing products for the same patient populations that we are pursuing. To compete successfully in these areas, we must demonstrate improved safety, efficacy and/or tolerability, ease decline or experience periods of manufacturing, and gain and maintain market acceptance over competing products.significant volatility.

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Prior heading: If we discover safety issues with any of our products or if we fail to comply with continuing U.S. and applicable foreign regulations, commercialization efforts for the product could be negatively affected, the approved product could lose its approval, and our business could be materially harmed.

Our products are subject to continuing After regulatory oversight, including the review of additional safety information. Products approval and launch, our products are more widely used over longer periods of time and by larger populations of patients once approval has been obtained and therefore side effects than during pre-approval clinical trials. Additional clinical and other problems non-clinical studies, such as for label expansions, new combinations or otherwise, may also be observed conducted after approval that were not seen or anticipated, or were not regulatory approval. For example, as prevalent or severe, during pre-approval clinical trials part of FDA approval for CASGEVY, we are required to conduct post-marketing safety studies to assess certain long-term risks associated with the treatment. Additionally, when post-marketing studies involve our marketed products, or nonclinical studies. an active pharmaceutical ingredient thereof, they can raise new safety issues for our existing products. The subsequent discovery or appearance of previously unknown or underestimated problems safety or efficacy concerns with a product could negatively affect commercial sales of the product, result in restrictions on the product reduced coverage or reimbursement by payors, cause reputational harm, government investigations, and/or lawsuits against us. Subsequent adverse safety events, as well as safety or efficacy issues affecting suppliers or competing products, may also lead to the recalls, denial or withdrawal of the product from the market. regulatory approvals, non-renewal of conditional regulatory approvals, label changes, obligations to conduct additional or more extensive clinical trials or to implement a risk management plan, and reductions in market acceptance. Each of our CF products shares at least one active pharmaceutical ingredient with another of our products. As a result, if If any of our CF products were to experience safety issues or labeling modifications, our other CF products may be adversely affected. For example, in December 2024, the FDA modified required us to modify the labeling of TRIKAFTA label by revising information regarding liver injury and liver failure and moving it that information from the “warnings and precautions” section to a “boxed warning” section, and included section; the FDA required similar language in the ALYFTREK label. In SCD and TDT, as part of the FDA approval for CASGEVY, we are required to conduct two post-marketing requirement addition, safety studies to assess or efficacy issues affecting suppliers’ or competitors’ products also may reduce the long-term risk market acceptance of hematologic malignancies and off-target genome editing effects by CRISPR/Cas9. Negative or ambiguous results from these studies could have a significant impact on our ability to commercialize our products. The reporting discovery of adverse safety events involving our products or public speculation about such events could limit or reduce product revenues and cause our stock price to decline or experience periods of volatility. Our business also may be materially harmed by reduced coverage or reimbursement by payors, impaired sales of our products, denial or withdrawal of regulatory approvals, non-renewal of conditional regulatory approvals, required label changes or additional clinical trials, reputational harm, or government investigations or lawsuits brought against us. Our products are subject to ongoing regulatory requirements governing the testing, manufacturing, labeling, packaging, storage, advertising, promotion, sale, distribution, import, export, recordkeeping, and submission of safety and other post-market information. We and our third-party manufacturers must comply with cGMP and other applicable regulations governing the manufacturing and distribution of our products. Regulatory authorities periodically inspect our drug manufacturing facilities, and those of our third-party manufacturers, to evaluate compliance with cGMP and other regulatory requirements. If we or our collaborators, or third-parties acting on our behalf, fail to comply with applicable continuing regulatory requirements, we or our collaborators may be subject to fines, suspension or withdrawal of regulatory approvals for specific products, product recalls and seizures, operating restrictions and/or criminal prosecutions, any of which could have a material adverse effect on our business, reputation, financial condition, and results of operations.volatility.

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Prior heading: Our product candidates remain subject to clinical testing and regulatory approval, and our future success is dependent on our ability to successfully develop additional product candidates for both CF and non-CF indications.

Our business depends upon the successful development and commercialization of product candidates. These product candidates are in various stages of development and must satisfy rigorous standards of safety and efficacy before they can be approved for sale by the FDA or comparable foreign regulatory authorities. To satisfy these standards, we must allocate resources among our various development programs and must engage in expensive and lengthy Extensive testing of is required for our product candidates. Discovery candidates and development efforts for new pharmaceutical and biological products, including new combination therapies, are resource-intensive and may take 10 to 15 years or longer for each product candidate. It is impossible to predict when or if any indications of our product candidates will prove effective and safe in humans or will receive regulatory approval. Despite our efforts, our product candidates may not: •offer therapeutic or other improvement over existing competitive therapies; •show the level marketed products. The outcomes of safety such clinical and non-clinical testing are highly uncertain, may not generate sufficient safety, efficacy, including the level of statistical significance, required by the FDA or other data, and may not support regulatory authorities for approval of a drug or biologic; •meet applicable regulatory standards; •be capable of being produced in commercial quantities at acceptable costs; or •if approved for commercial sale, be successfully marketed as pharmaceutical or biological products. We have recently completed and/or have ongoing or planned clinical trials for several of our product candidates. The strength of our product portfolio and pipeline will depend in large part upon the outcomes of these clinical trials, including those evaluating TRIKAFTA/KAFTRIO and ALYFTREK in younger children with CF, VX-522 in CF, suzetrigine in peripheral neuropathic pain, VX-993 in acute and diabetic peripheral neuropathy, Clinical and zimislecel non-clinical testing, and VX-264 in T1D. Failure to advance product candidates through clinical development could impair our ability to ultimately commercialize products, which could materially harm our business and long-term prospects. Results of our clinical trials and findings from particular our nonclinical studies, including toxicology findings in nonclinical studies conducted concurrently with later- stage clinical trials, could lead to abrupt changes in our development activities, including the possible cessation of development activities associated with a particular product candidate or program. Moreover, clinical data are often susceptible to varying interpretations, expensive and many companies that have believed their product candidates performed satisfactorily in clinical trials have nonetheless failed to obtain marketing approval of their product candidate. Furthermore, results resource intensive. The data from our clinical trials may not meet the level of statistical significance or otherwise provide the level of evidence or safety preclinical studies and efficacy required by the FDA or other regulatory authorities for approval of a product candidate. Finally, clinical trials are expensive and require significant operational resources to implement and maintain. Many companies research activities have in the pharmaceutical past and biotechnology industries, including our company, have suffered significant setbacks may in later-stage clinical trials even after achieving promising the future fail to predict results in earlier-stage clinical trials. For example, despite considerable non-clinical testing, the results from completed preclinical studies and clinical trials may not be replicated study of VX-264 in later clinical trials, and ongoing T1D did not meet its efficacy endpoint. Similarly, results from earlier-stage clinical trials for our product candidates may not be predictive of the results we may obtain in from later-stage clinical trials trials, or of the likelihood of approval of a product candidate for commercial sale. sale. In addition, from time to time, we report interim, topline, and preliminary data from our clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change. Interim interim or preliminary data from a clinical trial may not be predictive of final results from the clinical trial and are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment and treatment continues and continues, more patient data become available available, or as patients from our clinical trials continue other treatments for their disease. Topline data also remain subject to audit and verification procedures that may result in the final disease. The data being materially different from the preliminary data our clinical programs may not support approval or successful commercialization of our product candidates, and we previously published. As a result, topline data should may be viewed with caution until the final data are available. If unable to recoup the interim, topline, significant research and development, clinical trial, acquisition-related, and other expenses incurred, which could have an adverse effect on our business, financial condition and results of operations, and/or cause our stock price to decline or preliminary data that we report differ experience periods of volatility. In addition, results of our clinical trials and findings from actual results, or if others, nonclinical studies could lead to abrupt changes in our development activities, including regulatory authorities, disagree the possible cessation of development activities associated with a particular product candidate or program. For example, after VX-264 did not meet its efficacy endpoint, we announced that the conclusions reached, our ability program would not advance into further clinical studies. Failure to obtain approval for, and commercialize, our advance product candidates may be harmed, through clinical development would impair our ability to commercialize products, which could materially harm our business, operating results, prospects or financial condition. The ability condition and long-term prospects. Our research and development activities are highly regulated, and it is possible that the FDA and other regulatory authorities: •pause or halt our clinical trials based on their assessment of third parties to review and/or analyze data the potential or actual risks of continuing; •disagree with our conclusions about the results from our clinical trials; •require additional clinical trials, including as a result of government disclosure, also may increase the risk of commercial confidentiality breaches and result in enhanced scrutiny of confirmatory trials, or disagree with our clinical trial results. For example, Clinical Trial Regulation (EU) No. 536/2014, and design or endpoint; •fail to approve the EMA policy on publication facilities or processes used to manufacture a product candidate, or our dosing or delivery methods; •grant marketing approval that is more restricted than anticipated, including limiting indications to narrow patient populations and imposing safety monitoring requirements, or risk evaluation and mitigation strategies; •withdraw approval of clinical data for medicinal products for human use, both permit a product or indication, including when the EMA to publish product or indication was approved under an accelerated approval pathway and confirmatory studies were unsuccessful. Furthermore, we periodically release new information, including clinical information submitted in marketing authorization applications. Third party review data, regarding our products and scrutiny could result in public misconceptions product candidates, which may affect investors’ perceptions regarding our drugs products and product candidates. These publications could also result candidates, and cause our stock price to decline or experience periods of significant volatility. For example, our stock price decreased in August 2025 after we released Phase 2 data for VX-993 and informed investors that the disclosure FDA did not see a path toward a broad peripheral neuropathic pain label for suzetrigine at that time. The timing of the release of information to by us regarding our competitors that we might otherwise deem confidential, which could harm product development programs is often beyond our business.control and is influenced by the timing of receipt of communications from regulators and data from our clinical trials, among other things.

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Prior heading: Enrollment for clinical trials for our cell and gene therapies may face additional and unique challenges and adverse developments associated with these clinical trials could result in action by regulatory bodies, including revised requirements for approval.

For cell and genetic therapy programs addressing rare genetic diseases with small patient populations, we may not be able to identify, recruit and enroll Conducting clinical trials is a sufficient number of patients, or those with required or desired characteristics, complex, lengthy and expensive process. Our ability to complete our clinical studies in an trials on our anticipated timelines depends on numerous factors, including proper and efficient protocol design, regulatory and institutional review board approval, adequate patient enrollment and timely manner. Additionally, patients may be unwilling to participate retention rates, and compliance with current good clinical practices. Delays or complications in our clinical trials because of concerns that cell and genetic therapies are unsafe may arise from difficulties in enrolling or unethical, negative publicity retaining patients, competition from other clinical trials, the occurrence of significant and/or unexpected adverse safety events events, changes in the biotechnology or gene therapy industries, regulatory requirements, supply chain issues or disruptions at clinical trial sites. Further, we may face additional challenges identifying and enrolling sufficient patients for other reasons, including competitive clinical studies trials for similar rare diseases and cell and gene therapies due to small patient populations. Moreover, adverse developments in clinical trials conducted by others of With respect to cell and genetic therapy products or products created using similar technology, or adverse public perception therapies there may be additional concerns regarding the safety of these more novel therapeutic approaches to the field treatment of cell these diseases. If we or our third-party clinical trial providers, including contract research organizations (“CROs”), do not successfully conduct and genetic therapies, manage our clinical activities or adequately comply with regulatory requirements, our clinical trials may cause the FDA experience delays or increased costs, and other regulatory bodies to revise the requirements for potential regulatory approval of any cell a product candidate or genetic therapy expansion of a label for a marketed product candidates we may develop be delayed or limit the use of products utilizing technologies such as ours, either of which denied. Any delay in obtaining required regulatory approvals could materially harm adversely affect our business.ability to successfully commercialize a product candidate.

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Prior heading: The regulatory approval process for our cell or genetic therapies involves additional consultations with regulatory agencies, costs, and potentially longer timelines as compared to those for small molecules.

As we advance our cell The health care industry is highly regulated and genetic therapy product candidates, we will be required subject to consult with various regulatory authorities, complex and we must comply with all applicable laws, rules, increasing regulations. U.S. federal and regulations, which may change from time to time, state regulators, including during the course of development of FDA and comparable ex-U.S. regulators directly regulate our cell most critical business activities, including those related to research, development, manufacturing, and genetic therapy product candidates. If we fail commercialization, as described in Item 1, “Business – Government Regulation.” The process for obtaining regulatory approvals to do so, we market a product is costly and time consuming, and approvals may not be required to delay granted for future products, or discontinue the clinical development of certain of our cell and genetic therapy product candidates. These additional processes may result in indications of existing products, on a review and approval process that is longer than we otherwise would have expected. Even if timely basis or at all. In addition, we comply with applicable laws, rules, and regulations, and even if cannot guarantee that we maintain close coordination will remain compliant with the applicable regulatory authorities with oversight over requirements once approval has been obtained. These requirements govern, among other things, our cell and genetic therapy product candidates, manufacturing practices, communications regarding our development programs may experience delays or fail to succeed. Delay or products, and reporting of safety events. Maintaining compliance with these extensive regulations is complex, expensive, and time consuming, and failure to obtain, or unexpected costs comply may result in obtaining, the additional regulatory approval necessary to bring a potential cell actions, including recalls, withdrawal or genetic therapy suspension of product to market would materially adversely affect our business, financial condition, results approvals, civil and criminal charges, reputational harm, and fines, penalties, or other monetary or non-monetary remedies, including exclusion from receipt of operations payment from U.S. federal and prospects. The regulatory approval process state healthcare programs like Medicare and clinical trial Medicaid. Compliance with the regulatory requirements for biologics and cell and genetic gene therapies can be more burdensome, expensive and take longer time-consuming than for other, better known or more extensively studied product candidates, and regulatory types of medicines, such as small molecules. Regulatory requirements governing cell and genetic therapy products have changed frequently and may continue to change in the future. For example, the FDA established the Office of Tissues and Advanced Therapies within its Center for Biologics Evaluation and Research (“CBER”) Furthermore, risks relating to consolidate the review of cell therapies compliance with laws and related products, regulations may be heightened as we continue to expand our global operations and enter new therapeutic areas with different patient populations, which may require different commercialization activities from those we currently utilize. We expect that regulation of the Cellular, Tissue and Gene Therapies Advisory Committee healthcare industry will continue to advise CBER on its review. These and other regulatory review agencies, committees evolve through political and advisory groups, legal action, as future proposals to reform healthcare systems are considered by U.S. and the requirements foreign governments and guidelines they promulgate, may lengthen the regulatory review process, require us to perform authorities. We cannot predict when additional preclinical studies or clinical trials, increase our development costs, lead to changes in regulatory positions the healthcare industry in general, or the pharmaceutical industry in particular, will occur, or what the impact of such changes may be. For example, new proposals or requirements regarding local manufacturing of pharmaceutical products, enhanced data security and interpretations, delay privacy measures, sustainability, importation restrictions, embargoes, or prevent approval trade sanctions may negatively impact our business. In addition, our development and commercialization of these treatment candidates activities could be harmed or lead to significant post-approval limitations delayed by a shutdown of the U.S. government or restrictions.events that affect the manner in which the FDA operates.

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Prior heading: If regulatory authorities interpret any of our conduct, including our marketing practices, as being in violation of applicable health care laws, including fraud and abuse laws, laws prohibiting false and misleading promotion, disclosure laws or other similar laws, we may be subject to civil or criminal penalties.

We are subject to health care fraud and abuse laws, such as the FCA and the AKS, and other similar laws and regulations both in the U.S. and in non-U.S. markets. In the U.S., the Federal Anti-Kickback Statute prohibits knowingly and willfully offering, paying, soliciting, receiving or providing remuneration, directly or indirectly, in exchange for or market our products to induce either the referral of an individual, or the ordering, furnishing, arranging for or recommending of an item or service that is reimbursable, in whole or in part, by a federal health care program, such as Medicare or Medicaid. Because of the broad scope of the prohibition, most financial interactions between pharmaceutical manufacturers and prescribers, purchasers, third party payors and patients would be subject to the statute. Although there are a number of statutory exceptions providers and regulatory safe harbors protecting certain common activities from prosecution, financial interactions must be structured carefully to qualify for protection or otherwise withstand scrutiny. Federal false claims laws, including the FCA, prohibit any person from knowingly presenting, or causing to be presented, a false claim for payment to the federal government, or knowingly making, or causing to be made, a false statement to get a false claim paid. Pharmaceutical companies have been prosecuted under these laws for a variety of alleged provide promotional materials and marketing activities, such as providing free product to customers with the expectation that the customers would bill federal programs for the product; reporting to pricing services inflated average wholesale prices that were then used by federal informational programs to set reimbursement rates; engaging in promotion for uses that the FDA has not approved, that caused claims to be submitted to Medicaid for those unapproved uses; submitting inflated “best price” information to the Medicaid Rebate Program; and certain manufacturing-related violations. The scope of this and other laws may expand in ways that make compliance more difficult and expensive. The FDA and other regulatory agencies closely regulate regarding the post-approval marketing and promotion use of products to ensure that they are marketed only for the approved indications and each product in accordance or consistent with the provisions of the approved labeling. Although physicians are generally these patient populations. In jurisdictions where permitted, based on their medical judgment, to prescribe products for indications other than those approved by the applicable regulatory agency, manufacturers are prohibited from promoting such unapproved uses. We we also market our products to eligible people with CF, SCD, TDT, and acute pain patients for whom the applicable product has been approved and provide promotional materials and informational programs approved, as well as to physicians regarding the use of each product in these patient populations. These eligible people do not represent all people with CF, SCD, TDT, and acute pain. their caregivers. If a regulatory agency determines that authority interprets any of our promotional materials, conduct, including our marketing practices or other activities constitute patient support programs, as promotion of unapproved uses or otherwise false and misleading promotion, misleading, it could request that we modify or withdraw our promotional materials or other activities, conduct issue corrective advertising, or subject us to regulatory advertising. It could also take enforcement actions, action, such as the issuance of a issuing warning or untitled letter, injunction, seizure, letters, prohibiting certain of our activities, seizing products, and imposing civil fines and criminal penalties. It also is also possible that other federal, state, or foreign enforcement authorities might take action if they believe that the alleged improper promotion conduct led to the submission and payment of claims for an unapproved use, uses of our product, which could result in significant fines or penalties under other statutory authorities, such as laws prohibiting false claims for reimbursement. penalties. Even if it is later determined we were not in violation of these laws, we may be faced with negative publicity, incur significant expenses defending our actions, and have to divert significant management resources from other matters. In the U.S., federal and state laws regulate financial Our interactions between pharmaceutical manufacturers with health care providers that prescribe or purchase our products are also subject to laws and healthcare providers, require disclosure regulations designed to government authorities prevent fraud and abuse in the public sale and use of such interactions, medicines and mandate that place significant restrictions on the adoption marketing practices of compliance standards or programs. For example, biopharmaceutical companies. The relationships between companies and health care providers are scrutinized and have been the so-called federal “sunshine law” requires pharmaceutical manufacturers to report annually to CMS payments or other transfers target of value made by that entity to physicians, physicians assistants, advanced practice registered nurses, lawsuits and teaching hospitals. We also have similar reporting obligations with respect investigations alleging various problematic conduct, including submission of incorrect pricing information, improper promotion of pharmaceutical products, payments intended to financial interactions throughout influence the E.U. We expended significant efforts to establish, referral of health care business, submission of false claims for government reimbursement, and anticompetitive behavior. We are continuing to devote significant resources to maintain and enhance, systems and processes to comply with these regulations. Requirements required to track and disclose financial interactions with health care providers and organizations health care organizations, which may increase government and public scrutiny of these financial interactions. Failure to comply with these reporting requirements could result in significant civil monetary penalties. As we commercialize products in areas with broader for new patient populations, populations and in new geographies, we will have more interactions with a broader set of healthcare practitioners. Failure providers and we must continue to expend significant efforts to establish, maintain and enhance systems and processes to comply with the laws and regulations governing those interactions. Government price reporting requirements could result in significant civil monetary penalties. The sales and marketing practices of our industry have been the subject of increased scrutiny from government authorities in payment regulations are also complex, requiring us to continually assess the U.S. and other countries in methods by which we market our products, calculate and we believe that this trend will continue. Many of report pricing in accordance with these laws have not been fully interpreted by the government authorities or the courts, and their provisions obligations. Our methodologies for calculations are inherently subject to a variety of interpretations. While we have a corporate compliance program which, together with our policies assumptions and procedures, is designed may be subject to actively identify, prevent and mitigate risk through the implementation of compliance policies and systems review and challenge by various government agencies, which may disagree with our interpretation. If the promotion of a culture of compliance, if government disagrees with our reported calculations, we are found not may need to be in full compliance with these laws restate previously reported data and regulations, our business could be materially harmed. We may be subject to penalties, including civil additional financial and criminal penalties, damages, fines, exclusion from federal health care programs and/or the curtailment or restructuring of our operations. Even if we successfully defend against government challenge, responding to the challenge may cause us to incur significant legal expenses and divert our management’s attention from the operation of our business.liability.

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Prior heading: If our patents do not protect our products or our products infringe third-party patents, we could be subject to litigation which could result in injunctions preventing us from selling our products, substantial damages, or circumvention of our patents by third parties.

We own and/or control numerous issued patents and pending patent applications in the U.S., as well as counterparts in other countries. Our success will depend, depends, in significant part, on our ability to obtain and defend U.S. obtain, maintain, and foreign enforce patents covering our products, their uses and our processes, to preserve our trade secrets and to operate without infringing the proprietary intellectual property rights of third parties. We cannot be certain that any patents will issue from our pending patent applications or, even if patents issue or have issued, that the issued claims will provide us with adequate protection against competitive products or otherwise be commercially valuable. U.S. such as trademarks and foreign patent applications typically are maintained in confidence for a period of time after they initially are filed with the applicable patent office. Consequently, we cannot be certain copyrights that we were the first to file patent applications on our products or product candidates or their use. If a third-party has an earlier filed patent application relating to protect our product or products, product candidates, their uses, or a similar invention, and technologies. In addition, we may be unable rely upon trade secret protection and contractual arrangements to obtain an issued patent from protect certain of our application. proprietary information. Due to evolving the complexity of the legal standards and factual questions relating to the patentability, validity, and enforceability of patents covering pharmaceutical and biotechnological inventions and the scope of claims made under these patents, our ability to obtain, maintain and enforce our patents is uncertain and involves complex legal uncertain. The initial grant of patents or regulatory exclusivity in the U.S. and factual questions. We have many pending patent applications covering our products. These pending ex- U.S. markets depends upon decisions of the patent applications may not issue, offices, courts, and we governments in those countries. We may not receive any additional patents. The issuance of a patent is not conclusive as fail to its inventorship, scope, validity, obtain, defend or enforceability. Our patents may be challenged by third parties otherwise preserve patent and other intellectual property rights, including certain forms of regulatory exclusivity, and our patents have been challenged. This could result in the patent being deemed invalid, unenforceable current intellectual property rights or narrowed protections and those we obtain in scope, or the third party future may circumvent any such issued patents, including through compulsory licensing mechanisms. When market exclusivity ends not be broad enough or if our patents are circumvented, generic versions of sufficient to protect our medicines may be approved and marketed, which could cause substantial and rapid declines commercial interests in the sales of our products. Our patents or patents all countries where we license might not contain claims that are sufficiently broad conduct business. In the U.S. and ex-U.S. markets, third parties have challenged and may continue to prevent others from developing competing products. For instance, issued patents, challenge, invalidate, or circumvent our patents that may issue in the future, (i) and patent applications relating to our small molecules may be limited to a particular molecule or molecules products, product candidates, and may not cover similar molecules that technologies. We have similar clinical properties, had and (ii) relating may continue to cell or genetic therapies have disputes with respect to the rights to products, product candidates, and technologies developed in collaboration with other parties. If we cannot resolve disputes and obtain adequate intellectual property right protections, we may not cover similar technologies that would allow competitors be able to achieve similar results. Consequently, our competitors may independently develop competing products that do not infringe our patents or other intellectual property. The laws market our products. Settlements of many foreign jurisdictions do not protect intellectual property rights to the same extent as such proceedings could also result in reducing the U.S. We, like many companies in our segment period of the pharmaceutical industry, have encountered challenges in protecting exclusivity and defending such rights other protections, resulting in a reduction in revenue from affected products. Any litigation, including litigation related to Abbreviated New Drug Applications (“ANDA”), litigation related to 505(b)(2) applications, interference proceedings to determine priority of inventions, derivations proceedings, inter partes review, oppositions to patents in foreign jurisdictions. countries, litigation against our collaborators, or similar actions, could harm our business. Difficulties in, or preclusion from from, protecting our intellectual property rights in foreign jurisdictions, including through compulsory licensing, jurisdictions could substantially harm our business. Because business. Third-party manufacturers may be able to sell generic versions of the extensive time required our products in countries that do not provide effective mechanisms for the discovery, development, testing and regulatory review enforcement of product candidates, it is possible that our patents or other intellectual property rights. For example, we have experienced a patent may expire before violation of our intellectual property rights in Russia, where a copy product candidate can be commercialized, or that infringes our patents has been made available. In addition, many foreign countries have compulsory licensing laws under which a patent may expire or remain owner must grant licenses to third parties in effect certain circumstances. Compulsory licenses have been used in certain countries for only a short period following commercialization of such product candidate. This would result market access purposes and, in some cases, as a minimal cost-containment measure. Compulsory licenses issued for our patents may diminish or non-existent period of patent exclusivity. If reduce revenue from those jurisdictions and negatively affect our product candidates are not commercialized significantly ahead results of the expiration date operations. Third parties may also illegally distribute and sell counterfeit versions of any applicable patent, our products. Copy or if we have no patent protection on counterfeit products may not meet our rigorous manufacturing and testing standards and a patient who receives such product candidates, then, to the extent available we would rely on other forms may be at risk for a number of exclusivity, such dangerous health consequences. Our business and reputation could suffer harm as data exclusivity or orphan drug exclusivity.a result of illegally produced and distributed generic versions of our products, as well as counterfeit products sold under our brand name. The diversion of products from their authorized market into other channels may result in reduced revenues and negatively affect our profitability.

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Prior heading: Risks Related to Intellectual Property

•If our patents do not Our competitors seek to protect our products their products, product candidates and our products infringe third-party proprietary information through patents, we could be subject to litigation which could result trademarks, trade secrets, and copyrights. Third parties have claimed and may claim in injunctions preventing us from selling the future that our products, substantial damages, products or circumvention of other activities infringe their intellectual property rights or that our patents by third parties. •Uncertainty over employees have misappropriated their intellectual property in the pharmaceutical and biotechnology industry has been the source rights. See also Item 1., Business – Intellectual Property of litigation and this Annual Report on Form 10-K. Resolving an intellectual property infringement or other disputes that are inherently claim can be costly and unpredictable. •We time consuming and may be subject require us to claims by third parties asserting that our employees enter into license agreements, which may not be available on commercially reasonable terms. A successful claim of patent infringement or we have misappropriated their other violation or misappropriation of intellectual property, property rights by a third party could subject us to significant damages and/or an injunction preventing the manufacture, sale, or claiming ownership use of what we regard as the affected product or products, and/or require us to pay royalties or redesign our own intellectual property.infringing products, which may be impossible or require substantial time and monetary expenditure.

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Prior heading: Our business has a substantial risk of product liability claims and other litigation liability.

We are or may be involved in various legal proceedings, including securities/shareholder matters and claims related to product liability, intellectual property, employment law, competition law, data privacy, and breach of contract. Such proceedings may involve claims for, or the possibility of, damages or fines and penalties involving substantial amounts of money or other relief, including civil or criminal fines and penalties. If any of these legal proceedings were to result in an adverse outcome, it could have a material adverse effect on our business. For example, we pay royalties on certain sales of TRIKAFTA/KAFTRIO, SYMDEKO/SYMKEVI, KALYDECO, ORKAMBI and ALYFTREK pursuant to our agreement with the Cystic Fibrosis Foundation. The third-party to whom the Cystic Fibrosis Foundation has assigned rights to receive these royalty payments has made public statements related to the calculation of royalties associated with ALYFTREK. Based on the agreement between Vertex and the Cystic Fibrosis Foundation, we believe the third party is wrong. If any potential future adversarial proceedings were not resolved in our favor, however, we could be required to pay a higher royalty percentage on ALYFTREK sales than we currently expect, testing, manufacturing, marketing and our future cost of goods with respect to ALYFTREK could increase above our current expectations. The use of our approved products and our product candidates exposes us to the involve substantial risk of product liability claims. Product liability These claims may be brought against us made directly by people participating in clinical trials, consumers, patients, healthcare providers, or others selling or coming in contact with our products or our product candidates. There is a risk that our products or our product candidates may induce adverse events. For instance, the product labels for TRIKAFTA and ALYFTREK include a boxed warning regarding liver injury and liver failure. If we cannot successfully defend ourselves against product liability claims, we could incur substantial others. Product liability claims and costs, which could have a material adverse effect on our business lawsuits and safety alerts or financial condition. In addition, product recalls, regardless of merit or eventual their ultimate outcome, product liability claims may result in: •Decreased decrease demand for our approved products, such as TRIKAFTA and ALYFTREK, products or any product candidate for which we obtain marketing approval; •Inability to successfully commercialize approved products; •Impairment of our business reputation approval, and exposure to may have a material adverse publicity; •New or increased warnings effect on our product labels; •Withdrawal of clinical trial participants; •Costs as a result of related litigation; •Distraction business, results of management’s attention from operations, reputation, and our primary business; •Substantial monetary awards ability to patients or other claimants; and •Loss of revenue. We have market our products. Our product liability insurance and clinical trial insurance in amounts that we believe are adequate to cover this risk. However, our insurance may not provide adequate coverage against all potential liabilities. If a claim is brought against us, we might be required liabilities. There continues to pay legal be a significant volume of government and other expenses to defend the claim, regulatory investigations and litigation against companies operating in our industry, as well as pay uncovered damage awards and these damages could be significant robust regulatory enforcement and have a material adverse effect on whistleblower claims. Investigations into aspects of our financial condition. Furthermore, whether or not we business include inquiries, subpoenas, and other types of information demands from government and regulatory authorities. We are ultimately successful also involved in defending any such claims, we might be required and are subject to direct other various legal proceedings, including litigation, and other dispute- related proceedings. These activities require significant financial and managerial resources internal resources. This includes the arbitration initiated by the third party to whom the CFF has assigned its ALYFTREK royalty rights. Please see Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Annual Report on Form 10-K for more information. The outcome of such defense legal proceedings, investigations or any other dispute-related proceedings are inherently uncertain and adverse publicity is likely to result.developments or outcomes can result in significant expenses, monetary damages, penalties, injunctions, or other relief against us, and in the ALYFTREK arbitration, could result in higher future costs of goods if royalty fees are higher than anticipated. For a description of our litigation, investigation and other dispute-related matters, see Note P., Commitments and Contingencies — Legal Matters and Other Contingencies, included in this Annual Report on Form 10-K.

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Prior heading: We are subject to various and evolving laws and regulations governing the privacy and security of personal data, and our failure to comply could adversely affect our business, result in fines and/or criminal penalties, and damage our reputation.

We are subject to a variety of evolving and developing data privacy and security laws and regulations in various jurisdictions that apply related to the collection, storage, use, sharing, and security of personal data, including health information, and impose significant compliance obligations. In addition, numerous other federal and state laws, including state security breach notification laws, state health information privacy laws and federal and state consumer protection laws, govern the collection, use, disclosure and security of personal information. The legislative and regulatory landscape for privacy and data protection continues to evolve, and there has been an increasing focus on privacy and information. Regulators globally are imposing data protection issues with the potential to affect our business. As we enter into new disease areas and jurisdictions both commercially and for clinical trials, we must continue to evaluate new and evolving privacy laws. For example, the E.U. General Data Protection Regulation (“GDPR”) went into effect in 2018 and has imposed new obligations on us with respect to our processing of personal data and the cross-border transfer of such data, including higher standards of obtaining consent, more robust transparency requirements, data breach notification security requirements, requirements for contractual language with our data processors, and stronger individual data rights. Different E.U. member states have interpreted such as the E.U.’s GDPR differently and many have imposed additional requirements, which add to the complexity of processing personal data in the E.U. The GDPR also imposes strict rules on the transfer of personal other domestic data to countries outside the E.U., including the U.S. privacy and security laws, such as the U.K., California Consumer Privacy Act and permits data protection authorities to impose large penalties for violations of the GDPR. Similarly, other jurisdictions have either introduced or enacted legislation or executive orders restricting cross-border data transfers. California Privacy Rights Act. These regulations restrict the transfer of certain and other similar types of data (e.g., sensitive personal data) or restrict the transfer of data to certain jurisdictions. The rules related to cross border data transfers continue to evolve based on court decisions and regulator guidance, which presents certain practical challenges to compliance. Regulators also continue to focus enforcement efforts on behavioral advertising laws and other online tracking technologies commonly used by companies. Compliance regulations that have been or may be passed often include requirements with these evolving rules is challenging, as country specific guidance and rules are continually changing and limited alternatives currently exist in the market. respect to personal information. Compliance with the these privacy laws and regulations is a rigorous and time-intensive process that may increase our cost of doing business or require us to change our business practices, and despite those efforts, there is a risk that we may be subject to fines and penalties, litigation, and reputational harm in connection with any activities falling within the scope of the GDPR or other privacy laws or regulations. In the U.S., numerous states have introduced or enacted comprehensive privacy legislation. Similar to the California Consumer Rights Act, which came into effect in January 2023), these comprehensive privacy laws place numerous obligations on businesses with respect to the collection and processing of personal data. Some states have passed privacy legislation focusing specifically on the collection and processing of consumer health data. Enforcement at the federal level in the U.S. from the FTC has been focused on the use of health information for targeted advertising. While we continue to address the implications of the new data privacy regulations, data privacy remains an evolving landscape at both the domestic and international level, with new regulations coming into effect and continued legal challenges. Each law is also subject to various interpretations by courts and regulatory agencies, creating even more uncertainty. While we have a global privacy program that addresses such laws and regulations, our efforts to comply with the evolving data protection rules may be unsuccessful. We must devote significant resources to understanding and complying with the changing landscape in this area. practices. Failure to comply with data protection laws may expose us to risk of enforcement actions taken by data protection authorities, private rights of action result in some jurisdictions, and potential significant penalties if we are found to be non-compliant. Failure to comply with the GDPR liability through government enforcement, private actions, civil and applicable national data protection laws of European Economic Area member states could lead to criminal fines of up to €20,000,000 or up to 4% of the total worldwide annual revenue of the preceding financial year, whichever is higher. Some of these laws and regulations also carry the possibility of criminal sanctions. For example, while penalties, litigation, and reputational harm. Although we are not directly subject to the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act (“HIPAA”), HIPAA, we could be subject to face penalties, including criminal penalties if we liability, for knowingly obtain obtaining or disclose individually identifiable disclosing protected health information from a non-compliant HIPAA-covered health care provider or research institution that has not complied with HIPAA’s requirements for disclosing such information. In addition, the entities. The commercialization of cell and gene genetic therapies requires the collection and involves processing of a greater amount of more personal data than traditional therapies, potentially increasing risk. our risk exposure. Furthermore, the number of government investigations and investigations, enforcement actions actions, and class action lawsuits related to data security incidents and privacy violations, with a specific focus particularly focused on online data sharing, continue to increase and government increase. Government investigations typically require significant resources and generate negative publicity, which could harm our business and our reputation.

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Prior heading: We may face manufacturing, supply, and distribution difficulties, among other challenges, delays, or interruptions, including at our third-party providers.

We rely on a worldwide network of third-party manufacturers and our internal capabilities, including our own manufacturing facilities in Boston, to manufacture product candidates for clinical trials as well as our medicines for commercial use. We also depend on third-party logistics providers to manage our shipments globally, and on approved distributors for supply, sales and marketing in certain markets. While we have developed internal capabilities could be subject to significant supply product candidates interruptions for use in our clinical trials as well as some of our products for commercial sale, a majority of the manufacturing steps needed to produce our medicines, therapies, product candidates, and drug products are performed through a third-party manufacturing network. The manufacture of our products and or product candidates can be complex, which may require lengthy technology transfers between us and the third parties on which we rely. We expect that we will continue to rely on third parties to meet our commercial supply needs and a significant portion of our clinical supply needs for the foreseeable future. We could be subject to significant supply interruptions as a result of disruptions to third party or our internal manufacturing capabilities. Our supply chain for sourcing raw materials and manufacturing drug product ready for distribution, including obtaining necessary supplies, is a multi-step international endeavor. Third-party contract manufacturers, including some in China, perform different parts of our manufacturing process. Contract manufacturers may supply us with raw materials, convert these raw materials into drug substance and/or convert the drug substance into final dosage form. We also use third parties are used for packaging, warehousing, and distribution of products. We maintain property insurance to cover potential losses that may result from supply interruptions capabilities or destruction at these third parties, however, this insurance may not be sufficient to cover all potential losses that may result. The manufacturing and logistics for cell and genetic therapies are highly complex, often short lead time operations that require partnership with an extensive network those of third parties to deliver product. These manufacturing and logistics operations require significant investment by us to secure capacity at third parties with expertise to meet our requirements. Even with the relevant experience and expertise, manufacturers of cell and genetic therapy products often encounter difficulties in production, including difficulties with production costs and yields, quality control, and compliance with federal, state and foreign regulations. There are many risks that could result in delays and additional costs, including the need to hire and train qualified employees and obtain access to necessary equipment and third-party technology. This capacity may be limited by the number of other clinical trials and commercial manufacturing ongoing for other companies seeking similar support. If third parties are unwilling suppliers or unable to meet our requirements, we could experience supply disruptions outside of our control. Additionally, manufacturing facilities, both foreign and domestic, are subject to inspections by the FDA and other U.S. and foreign government authorities. Although we actively engage with regulatory authorities, the timing of regulatory approvals for each of these facilities may be delayed for a variety of reasons. We may experience supply disruptions if regulatory agencies are unable to inspect the manufacturing facilities on which we rely. In addition, we and the third parties with whom we engage are required to maintain compliance with quality regulations globally. An inability to maintain compliance with such regulations, including cGMP requirements, could cause significant disruptions to our business and operations. Additionally, establishing, managing and expanding our global manufacturing and supply chain requires a significant financial commitment and the creation and maintenance of our numerous third-party contractual relationships. We may not be able to agree on contractual terms with third parties as needed for manufacturing of our products. Although we attempt to manage the business relationships with our partners, we could be subject to supply disruptions outside of our control. partners. Supply disruptions may result from a number variety of factors, including shortages in product raw materials, labor materials or labor, technical difficulties, regulatory inspections or restrictions, delays in construction, regulatory approval, and inspection of new facilities or the expansion of existing facilities, shipping or customs delays, inability to maintain compliance with quality or other regulations, including cGMP requirements, general global supply chain disruptions, events beyond our control, or any other and performance failure failures by us or any third-party manufacturer on which we rely. rely. Disruption in our supply chain or manufacturing capabilities can result in shipment delays, inventory shortages, lot failures, product withdrawals, recalls and other interruptions in the commercial and clinical supply of our products and product candidates. Any such disruption with respect to our commercial products could result in a failure to meet market demand, could negatively affect our patients, could reduce our net product revenues and/or increase our costs. Any such disruption in the supply of product candidates to our clinical trials could negatively affect the subjects enrolled in our clinical trials and/or cause delays in our clinical trials and applications for regulatory approval. Additionally, unfavorable geopolitical events or situations could affect our ability to interact with or conduct business with specific vendors within our global supply network, network or could prevent or delay the transportation of supplies or products to their planned destination. Any such disruptions could disrupt sales of our products and/or the timing or advancement of our clinical trials. If we or our third-party manufacturers become unable (including potentially through governmental actions or legislation targeted toward them) or unwilling to continue manufacturing product and we are not able to promptly identify another manufacturer, For example, we could experience a disruption in the commercial supply of our then-marketed medicines, which would have a significant effect depend on patients, our business, and our product revenues. Similarly, a disruption in the clinical supply of product candidates could delay the completion of clinical trials and affect timelines for regulatory filings. We have a limited number of critical steps and key materials for our manufacturing process that are single sourced, including China-based suppliers for commercialized products. To ensure the stability portions of our supply chains, we continue to develop chain. Finding alternative suppliers for our manufacturing processes and key materials. However, there can be no assurance that we will be able due to establish and maintain additional manufacturers geopolitical developments or capacity for all of our product candidates and products on a timely basis otherwise may not be feasible or at all. In the course of providing its services, could take a contract manufacturer may develop process technology related significant amount of time and involve significant expense due to the manufacture nature of our products or product candidates that and the manufacturer owns, either independently or jointly with us. This would increase our reliance on that manufacturer or require us need to obtain a license from that manufacturer to have our products or product candidates manufactured by other suppliers utilizing the same process.regulatory approvals.

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Prior heading: We rely on third parties to carry out our operations. Failure to maintain our third-party relationships or challenges at or with these third parties could materially harm our business.

Our business depends on relationships with third parties for a variety of functions, parties, including activities critical to supply and research, development, manufacturing, commercialization, research and development, and technology. For example, we rely on third parties such as CROs for the day-to-day management and oversight of our clinical trials, on CMOs for active ingredient manufacturing and finishing operations, and on logistics providers for the distribution of our products. We are expanding our relationships with CROs, CMOs, and other third parties as we enter markets in which we have no or limited experience. Failure by these any of our third parties to meet their contractual, regulatory, or other obligations, or any disruption in the relationship between Vertex and these a third parties, party upon whom we rely, or the failure of a third party to conduct activities in accordance with our expectations, could have an adverse effect on adversely affect the relevant research, development, manufacturing, commercial, or administrative activity and our business. Furthermore, these The foregoing risks may be heightened as a result of the limited number or specialized nature of certain third parties, as we may not be able to replace such third party in a timely manner, on commercially reasonable terms, or at all. The third parties upon which we rely are subject to their own unique operational and financial risks that are out of risks, as well as other difficulties, which, if realized, could negatively affect our control. When one business. If any of our third parties encounters financial, operational, violate, or are alleged to have violated, any laws or regulations, including anti-corruption or anti-bribery regulations, the GDPR, or other difficulties, our business laws and results regulations, during the performance of operations their obligations to us, we could be negatively affected.suffer financial and reputational harm or other negative outcomes, including possible legal consequences.

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Prior heading: If we fail to scale our operations to accommodate growth, our business may suffer.

We have expanded and are continuing As we continue to expand our global operations and capabilities, which has placed, and will continue to place, significant we face increasing demands on our management and our operational, research and development and financial infrastructure. To effectively manage our growing business, we need to continue to adapt as our business grows in scale and complexity across multiple disease states, modalities, and geographies, including by: to: •implement and clearly communicating our communicate corporate-wide strategies; •enhancing strategies and effectively prioritize resources; •enhance our operational and financial infrastructure, including expansion of our controls over data, records data and information; •enhancing information controls; •effectively leverage technology and automation where appropriate to enable efficient growth and remain competitive; •improve our operational, administrative, financial and management processes, including our cross-functional decision-making processes and our budget prioritization systems; prioritization; •effectively growing, training grow, train and managing manage our global employee base; and •expanding •expand our compliance and legal resources.

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Prior heading: A variety of risks associated with operating in foreign countries could materially adversely affect our business.

We have expanded our international Our global operations over the past several years subject us to market our medicines and expand risks that could adversely affect our research and development capabilities. New laws and industry codes in the E.U. and elsewhere have expanded transparency requirements regarding payments business and transfers of value revenue. In addition to healthcare professionals, requirements surrounding patient-level clinical trial data, the protection of personal data and increased sanctions for violations. Collectively, our expansion and these new requirements are adding ex-U.S. risks we face with respect to our compliance costs and potentially exposes us to sanctions in the event of an infringement or failure to report in these jurisdictions. In addition, a significant portion of our commercial supply chain, including sourcing of raw materials with local laws and manufacturing, is located in China regulatory requirements, pricing and the E.U. Consequently, we are, reimbursement, intellectual property, manufacturing capabilities and will continue to be, subject to risks related to operating in supply chain, foreign countries, including risks relating to intellectual property protections exchange risks, and business interruptions. Risks reliance on third parties, risks associated with operating a global biotechnology company include: •differing regulatory requirements for drug approvals and regulation of approved drugs in foreign countries; •varying reimbursement regimes and difficulties or the inability to obtain reimbursement for our products in foreign countries in a timely manner; •differing patient treatment infrastructures, particularly since our business is focused on the treatment of serious diseases that affect relatively smaller numbers of patients and are typically prescribed by specialist physicians; •collectability of accounts receivable; •changes in tariffs, trade barriers, and regulatory requirements, the risks of which appear to have increased in include the current political environment; potential for: •economic weakness, including recession and inflation, or political instability in globally or with respect to particular foreign economies and markets; •differing levels of enforcement and/or recognition of contractual and intellectual property rights; •circulation of unauthorized copy versions of our medicines that infringe our intellectual property rights; •governments seeking to override our intellectual property rights through the introduction of compulsory license or similar mechanisms; •complying with local laws and regulations, which can change significantly over time; •foreign taxes, •business interruptions resulting from geo-political actions, including withholding of payroll taxes; •foreign currency fluctuations, which could result in reduced revenues or increased operating expenses, and other obligations incident to doing business or operating in another country; •workforce uncertainty in countries where labor unrest is more common than in the U.S.; •reliance on third-party vendors, distributors war and suppliers; terrorism; •import and export licensing requirements, tariffs, trade barriers, and other trade and travel restrictions; restrictions, the risks of which appear to have increased in the current political environment; •credit risks related to our customers, which may be higher in less developed markets; and •global or regional public health emergencies that could affect our operations or business; •production shortages resulting from emergencies. If any events affecting raw material supply or manufacturing capabilities abroad; and •business interruptions resulting from geo-political actions, including war and terrorism. These of the above risks are increased with respect were to countries such as China that have substantially different local laws and occur, our revenues, results of operations, financial condition or business practices and weaker protections for intellectual property. In particular, there is currently significant uncertainty about the could be materially harmed. Current or future relationship between the U.S. and various other countries, legislation, including China, with respect to trade policies, treaties, tariffs, taxes, and executive orders, or other limitations on cross-border operations. The U.S. government has made and continues to make significant additional new changes in laws, regulations or policies in the U.S. trade policy and may continue to take future actions that or other countries could negatively impact U.S. trade. our business by increasing costs, decreasing demand for our products, and increasing government cost controls, among other risks. For example, U.S. legislation has been introduced in Congress to limit certain U.S. biotechnology companies from using equipment or services produced or provided by from select Chinese biotechnology companies, and others in Congress have advocated for the use of existing executive branch authorities to limit limitations on those Chinese service providers’ ability to engage in business in the U.S. We cannot predict what actions may ultimately be taken with respect to trade relations between the United States and China or other countries, what products and services may be subject to such actions actions, the effective date or duration of such actions, or what actions may be taken by the other countries in retaliation. response to actions by the United States. If we are unable to obtain or use services from existing service providers or become unable to export or sell our products to any of our customers or service providers, our business could be materially and adversely affected. Our revenues are subject to foreign exchange rate fluctuations due to the global nature of our operations. Although we have a foreign currency risk management program, our efforts to reduce currency exchange volatility may not be successful. As a result, currency fluctuations among our reporting currency, the U.S. dollar, and the currencies in which we do business will affect our operating results, often in unpredictable ways. In addition, our international operations are subject to regulation under U.S. law. For example, the FCPA prohibits U.S. companies and their representatives from offering, promising, authorizing or making payments to foreign officials for the purpose of obtaining or retaining business abroad. In many countries, the health care professionals we regularly interact with may meet the definition of a foreign government official for purposes of the FCPA. We also are subject to import/export control laws. Failure to comply with domestic or foreign laws could result in various adverse consequences, including the possible delay in approval or refusal to approve a product, recalls, seizures, withdrawal of an approved product from the market, the imposition of civil or criminal sanctions, the prosecution of executives overseeing our international operations and corresponding bad publicity and negative perception of our company in foreign countries.affected.

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Prior heading: A breakdown or breach of our information technology systems could subject us to liability or interrupt the operation of our business.

We maintain and rely extensively on information technology systems and network infrastructures infrastructures, internally and with third parties for the effective operation of our business. In the course of our business, we We collect, store, and transmit confidential information (including information, including personal information, financial information and intellectual property), and it is critical that we do so in a secure manner to maintain the confidentiality, integrity, and availability of such confidential information. A disruption, property. Disruption, infiltration, or failure of our information technology systems or any of our data centers as a result because of software or hardware malfunctions, computer viruses, cyber-attacks, employee theft or misuse, power disruptions, natural disasters, floods disasters or accidents could cause breaches of data security and and/or loss of critical data, which in turn could materially adversely affect our business and subject us to both private and governmental causes of action. While we have implemented security measures to minimize these risks to our data and information technology systems and have adopted a business continuity plan to deal with a disruption to our information technology systems, there can be no assurance that our efforts to protect our data and information systems will prevent breakdowns or breaches in our systems that could adversely affect our business. In addition, we maintain cyber liability insurance, however, this insurance may not be sufficient to cover the financial, legal, business or reputational losses that may result from an interruption or breach of our systems and those of critical third parties. business. Cyber-attacks and incidents are increasing in their frequency, sophistication, and intensity, and are becoming increasingly difficult to detect. They detect. Cyber-attacks are often carried out by well-resourced and skilled parties, including nation states, organized crime groups, “hacktivists” groups and employees or contractors acting carelessly or individuals with malicious intent. Cyber-attacks include deployment a wide range of harmful malware motives and key loggers, ransomware, denial-of-service attacks, malicious websites, expertise. Due to the use nature of social engineering, some cyber-attacks and other means to affect incidents, there is a risk that they may remain undetected for a period of time. Recent developments in the confidentiality, integrity threat landscape include the use of adversarial artificial intelligence techniques and availability machine learning, as well as an increased number of our technology systems cyber extortion attacks with higher financial ransom demand amounts and data. increasing sophistication and variety of ransomware techniques. Cyber-attacks and incidents also include manufacturing, hardware or software supply chain attacks, which could cause disruption to or a delay in the manufacturing of our products or products produced for contract manufacturing product candidates, or lead to a data privacy or security breach. Our business partners We use cloud technologies and any failure by cloud or other technology service providers to adequately safeguard their systems and prevent cyber-attacks or data privacy incidents could disrupt our operations and result in misappropriation, corruption, or loss of confidential or proprietary information. The third parties upon which we rely face similar risks and when they experience a security breach of their systems, our security can be adversely affected. Similar to other affected. Like many companies, we have experienced immaterial cybersecurity incidents, including temporary service interruptions of third-party suppliers. In addition, There can be no assurance that our increased use of cloud technologies heightens these third party and other operational risks, and any failure by cloud or other technology service providers efforts to adequately safeguard their systems protect our data and information systems will prevent cyber-attacks breakdowns or breaches in our systems that could disrupt adversely affect our operations and business. While we maintain cyber liability insurance, this insurance may not be sufficient to cover the financial, legal, business or reputational losses that may result in misappropriation, corruption, from an interruption or breach of our systems and those of critical third parties. Cybersecurity incidents can cause the loss of confidential critical or propriety information. A significant portion of our workforce continues sensitive information, including personal information, and could give rise to legal liability and regulatory action under data protection and privacy laws. In addition, we face certain risks as we seek to leverage hybrid work. Risk artificial intelligence to optimize productivity and efficiency in various aspects of cyber-attack is increased with employees working remotely. Remote work increases the risk we organization. Flaws, biases, or malfunctions in these systems could lead to operational disruptions, data loss, or erroneous decision-making, impacting our operations, financial condition, and reputation. Ethical and legal challenges may be vulnerable arise, including biases or discrimination in generated outcomes, non-compliance with data protection regulations and laws specifically governing the use of artificial intelligence systems and tools, and lack of transparency. Furthermore, the deployment of artificial intelligence systems could expose us to cybersecurity-related events increased cybersecurity threats, such as phishing attacks data breaches and unauthorized access. We also face competitive risks if we do not implement artificial intelligence or other security threats.machine learning technologies in a timely fashion.

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Prior heading: If our facilities were to experience a catastrophic loss, our operations would be seriously harmed.

Most of our operations, including our research and development activities, are conducted in a limited number of facilities. If any of our major facilities were to experience a catastrophic loss, loss due to an earthquake, flood, severe storms, fire or similar event, our operations could would be seriously harmed. For example, our corporate headquarters, as well as additional leased space that we use for certain logistical and laboratory operations and manufacturing, are located in a flood zone along the Massachusetts coast. We have adopted business continuity plans to address most crises. However, if If we are unable to fully effectively implement our business continuity plans, we may experience delays in recovery of data and/or an inability to perform vital corporate functions, which could result in a significant disruption in our research, development, manufacturing and/or commercial activities, operations, large expenses to repair or replace the facility and/or the loss of critical data, which could have a material adverse effect on our business. In addition, data. Additionally, we maintain use hazardous materials in some of our facilities, and any accident, injury or other loss related thereto could result in substantial liability. Our property insurance, however, this or other relevant insurance may not be sufficient to cover all potential losses that may result from an interruption to our operations.operations or damage resulting from these risks.

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Prior heading: Risks Related to Business Development Activities

•We face risks in connection with existing and future collaborations As part of our business strategy, we seek to enter into strategic transactions to acquire, license, or collaborate with respect other entities, in each case that have potential to the complement and advance our ongoing research, development, manufacture manufacturing, and commercialization efforts. Over the last several years we have engaged in a number of our products strategic transactions and product candidates. •Our ability to execute on collaborations, including our long-term strategy depends in part acquisition of Alpine and its lead asset, povetacicept, as well as several smaller transactions and collaboration arrangements. See also Item 1., Business – Strategic Transactions of this Annual Report on our ability Form 10-K. Our future transactions and collaborations may be similar to engage in prior transactions, may be structured differently from prior transactions, or may involve larger transactions or later-stage assets. We face significant competition for potential strategic transactions and collaborations with from a variety of other entities that add companies, some of which have significantly more financial resources and experience in business development activities. We may not complete future transactions in a timely manner, or at all, including due to our pipeline the possibility that a governmental entity or provide us with new commercial opportunities. •We regulatory body may delay or refuse to grant approval for the consummation of the transaction. We may not realize the anticipated benefits of existing our completed or future acquisitions of strategic transactions. The product candidates or products contemplated by those transactions may be delayed or terminated at any point during research or clinical development. Even if a product is approved, we may not be able to successfully commercialize it. As a result, we may fail to generate expected revenue growth or income contribution within the anticipated timeframe or at all. We also face risks that we: •may not effectively integrate acquired assets or businesses into our ongoing business; •may incur additional expenses or technologies, and fail to achieve anticipated cost savings related to the integration following strategic transactions; •may incur impairment charges related to assets acquired in any such acquisition may disrupt transactions; or •may acquire unanticipated liabilities. In addition, future strategic transactions could result in potentially dilutive issuances of equity securities or the incurrence of debt. We continue to collaborate with outside partners on research, development, manufacturing, and/or commercialization activities with respect to product candidates and products. We face the same research, development, manufacturing, and commercialization risks with respect to product candidates and products that are subject to collaborations as with product candidates and products that we have developed ourselves. We face additional risks in connection with our business current and management.future collaborative arrangements, including with respect to the performance of the collaborator and their compliance with contractual obligations.

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Prior heading: Our effective tax rate fluctuates, and changes in tax laws, regulations and treaties, unfavorable resolution to the tax positions we have taken or exposure to additional income tax liabilities could have a material impact on our future taxable income.

Our effective tax rate is derived from a combination of applicable tax rates in the various places that we operate globally. globally. Our effective tax rate may be different than experienced in the past due to numerous factors, including changes including: •changes in the mix of our profitability from country to country, tax country; •tax authority examinations/audits of our tax filings, adjustments filings; •adjustments to the value of our uncertain tax positions, changes positions; •changes in accounting for income taxes, taxes; and changes •changes in tax laws or modifications of treaties in various jurisdictions. jurisdictions. Any of these factors could cause us to experience an effective tax rate that is significantly different from previous periods or our current expectations. Various jurisdictions in which the group operates, including the U.K. and the E.U. member states have agreed expectations. For example, actions taken with respect to implement the minimum tax component (“Pillar Two”) of tax-related matters by associations such as the Organization Organisation for Economic Co-operation and Development’s (the “OECD’s”), global international tax reform initiative that aims to reform international taxation policies and ensure that multinational companies pay taxes wherever they operate Development and generate profits. Although aspects of Pillar Two have been implemented that affect accounting periods withing our group starting on or after December 31, 2023, the full impact of this initiative on our effective European Commission could influence tax rate will depend on the timing of implementation within each country laws in jurisdictions in which we operate, such as the exact nature of each country’s implementation legislation, guidance and regulations thereon, and their application enactments by tax authorities either prospectively or retrospectively. We are continuing to evaluate the potential impact on future periods both E.U. and non-E.U. member countries of the Pillar Two guidance, pending legislative adoption by individual countries, including those in which we do business. a global minimum tax. We are subject to ongoing tax audits in various jurisdictions, and local tax authorities may disagree with certain positions we have taken and assess additional taxes. We regularly assess the probable outcomes of these audits to determine the appropriateness of our tax provision, and we have established contingency reserves for material tax exposures. However, there can be no assurance that we will accurately predict the outcomes of these disputes or other tax audits or that issues raised by tax authorities will be resolved at a financial cost that does not exceed our related reserves and the actual outcomes of these disputes and other tax audits could have a material impact on our results of operations or financial condition.

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Prior heading: Future indebtedness could materially and adversely affect our financial condition, and the terms of our credit agreements impose restrictions on our business, reducing our operational flexibility and creating default risks.

In July 2022, we entered into a credit agreement providing for a $500.0 million revolving credit facility. If we borrow under our current credit agreement or any future credit agreements, or otherwise issue or incur additional debt, such indebtedness could have important consequences to our business, including increasing our vulnerability to general adverse financial, business, economic and industry conditions, as well as other factors that are beyond our control. business. The credit agreement requires that we comply with certain financial covenants, including a consolidated leverage ratio covenant. Further, the credit agreement includes covenant and negative covenants, subject to exceptions, restricting or limiting our ability and the ability of our subsidiaries to, among other things, incur additional indebtedness, grant liens, engage in certain investment, acquisition and disposition transactions, and enter into transactions with affiliates. As a result, we may be restricted from engaging in business activities that may otherwise improve our business. Failure to comply with the covenants could result in an event of default that could trigger acceleration of our indebtedness, which would require us to repay all amounts owed under the credit agreements and/or our finance leases and could have a material adverse effect on our business. Additionally, our obligations under the credit agreement are unconditionally guaranteed by certain of our domestic subsidiaries. indebtedness. If we incur additional indebtedness, the risks related to our business and our ability to service or repay our indebtedness would increase.

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Prior heading: Our stock price may fluctuate.

Market prices for securities of companies such as ours are highly volatile. Our stock price is subject to significant fluctuations. From January 1, 2024 2025 to December 31, 2024, 2025, our common stock traded between $377.85 $362.50 and $519.88 $519.68 per share. The market for our stock, like that of other companies in the biotechnology industry, has experienced significant price and volume fluctuations. The Our future market stock price of our securities could be significantly and adversely affected by factors such as: •the information contained in our quarterly earnings releases, including updates regarding our commercialized products or our product candidates, our net product revenues and operating expenses for completed periods and financial guidance regarding future periods; •announcements of FDA actions with respect to our therapies or those of our competitors, or regulatory filings for our therapies or those of our competitors, or announcements of interim or final results of clinical trials or nonclinical studies relating to our therapies or those of our competitors; by: •announcements we make or investor analyst commentary by public equity analysts with respect to regarding the clinical development of the our product candidates in our pain program; •developments in domestic as new information, including efficacy and international governmental policy or regulation, for example, relating to drug pricing safety information becomes available; •our financial guidance and/or financial results, including quarterly and tax law changes; •technological innovations or the introduction of new drugs by our competitors; •government regulatory action; •public concern annual fluctuations resulting from factors such as to the safety timing and amount of drugs developed by us or our competitors; •developments in patent or other intellectual property rights or announcements relating to these matters; •information disclosed by third parties regarding our business or products; •developments relating specifically to other companies and market conditions for pharmaceutical and biotechnology stocks or stocks in general; •business development, capital structuring or financing activities; revenues and •general worldwide or national economic, political expenses; and capital market conditions, •other factors including as a the risks described in these “Risk Factors.” Fluctuations in our stock price can result of inflation and rapid fluctuations in interest rates. substantial losses for shareholders. Following periods of volatility in the market price of a company’s securities, stockholder shareholder derivative lawsuits and securities class action litigation are common. common. Such litigation, if instituted against us or our officers and directors, could result in substantial costs and a diversion of management’s attention and resources.other harm to our business.

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Prior heading: If we fail to attract and retain skilled employees, our business could be materially harmed.

Due to the highly technical nature of our drug discovery We must attract and development activities, we require the services of retain highly qualified and trained scientists who have the skills necessary to conduct these activities. In addition, we need to attract and retain scientists, as well as employees with experience in the development, marketing manufacture, and commercialization of medicines and therapies, medicines, including biologic and cell and genetic therapies. We provide stock-related compensation benefits to all of our key employees that vest over time and therefore induce them to remain with us and have entered into employment agreements with some executives. However, the employment agreements can be terminated by the executive on relatively short notice. The value to employees of stock-related benefits that vest over time can be significantly affected by movements in our stock price and business performance, and may, at any point in time, be insufficient to counteract more lucrative offers from other companies. We face intense competition for our personnel such talent from our competitors competitors, other companies, academic institutions, and other companies organizations throughout our industry, especially with respect to employees with expertise in cell or genetic therapies. We also experience competition for the hiring of scientific and clinical personnel from universities and research institutions. Moreover, the growth of local biotechnology companies and the expansion of major pharmaceutical companies into the Boston area has increased competition for the available pool of skilled employees, especially in technical fields. The high cost of living can make it difficult to attract employees to our global headquarters in Boston and our international headquarters in London. Challenges could adversely affect our operations and financial results if we do Our compensation program, including equity awards, may not have be sufficient staff to perform necessary functions. In addition, the available pool of skilled employees would be further reduced retain employees, especially if immigration laws change in a manner that increases restrictions on immigration. our stock price declines or other employers offer more attractive opportunities. Our ability to continue to commercialize our products and achieve our research and development objectives depends on our ability to respond effectively to these demands. If we are unable to hire and retain qualified personnel, there our ability to advance our pipeline, commercialize our products, and achieve our business objectives could be a material adverse effect on our business.materially adversely affected.

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Prior heading: The use of social media platforms and artificial intelligence tools presents risks and challenges.

Social media is being increasingly used by patients, advocacy groups, and other third parties to communicate about discuss our products and product candidates and the diseases our therapies are designed to treat. We believe that members of the communities supporting serious diseases may be more active on social media as compared to other patient populations due to the demographics of those patient populations. candidates. Social media practices in the pharmaceutical and biotechnology industries are evolving, which creates uncertainty and risk of noncompliance with regulations applicable to our business. For example, patients posts may use social media platforms to comment on the effectiveness of, include statements about efficacy or adverse experiences with, a product or a product candidate, which events that could result in create reporting obligations. In addition, our employees may engage on obligations or regulatory scrutiny. Our employees’ use of social media in ways that may not comply also presents risks, including potential noncompliance with legal or regulatory requirements, which may give rise to liability, lead to the loss of trade secrets and other intellectual property, or result in public disclosure of protected personal information. There is a risk of inappropriate disclosure of sensitive confidential information or personal information, and loss of intellectual property. In addition, misinformation, negative or inaccurate posts or comments about us on any social networking website. Negative sentiment about us or our business shared over social media, or misinformation disseminated from fraudulent accounts impersonating our employees or our business, sentiment, or otherwise, could harm impersonation of our business and reputation, whether or not it is based in fact. Certain data protection regulations, such as the GDPR, apply to personal data contained on social media. If any of these events were to occur or we otherwise fail to comply with applicable regulations, we media could incur liability, face regulatory actions cause reputational damage or incur otherwise harm to our business, including damage business. Failure to our reputation. Similar appropriately manage these risks relating to inappropriate disclosure of sensitive information or inaccurate information appearing could result in the public domain may also apply from our employees engaging with and use of new artificial intelligence tools, such as ChatGPT.regulatory actions, liability, or other adverse consequences.

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Prior heading: We have adopted provisions in our articles of organization and by-laws and are subject to Massachusetts corporate laws that may frustrate any attempt to remove or replace members of our board or to effectuate certain types of business combinations involving us.

Provisions of our articles of organization, by-laws and Massachusetts state laws may frustrate any attempt to remove or replace members of our current Board of Directors and may discourage certain types of business combinations involving us. us. Our by-laws allow the Board of Directors to adjourn any meetings of shareholders prior to the time the meeting has been convened. We may issue shares of any class or series of preferred stock in the future without shareholder approval and upon such terms as our Board of Directors may determine. The rights of the holders of common stock will be subject to, and may be adversely affected by, the rights of the holders of any class or series of preferred stock that may be issued in the future. future. Massachusetts state law also prohibits us from engaging in specified business combinations with an interested stockholder, subject to certain exceptions, unless the combination is approved or consummated in a prescribed manner, and places restrictions on voting by any shareholder who acquires 20% or more of the aggregate shareholder voting power without approval by non-interested shareholders. As a result, shareholders or other parties may find it difficult to remove or replace our directors or to effectuate certain types of business combinations involving us. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This Annual Report on Form 10-K, including the descriptions of our Business set forth in Part I, Item 1, our Risk Factors set forth in Part I, Item 1A, and our Management’s Discussion and Analysis of Financial Condition and Results of Operations set forth in Part II, Item 7, contains forward-looking statements. Forward-looking statements are not purely historical and may be accompanied by words such as “anticipates,” “may,” “forecasts,” “expects,” “intends,” “plans,” “potentially,” “believes,” “seeks,” “estimates,” and other words and terms of similar meaning. Such statements may relate to: •our expectations regarding the amount of, timing of, and trends with respect to our financial performance, including revenues, costs and expenses, and other gains and losses; •our expectations regarding clinical trials, including expectations for patient enrollment, development timelines, the expected timing of data from our ongoing and planned clinical trials, and regulatory authority filings and other submissions for our therapies; •our beliefs, expectations, and plans with respect to the commercial launches of CASGEVY for the treatment of SCD and TDT, ALYFTREK for the treatment of CF, and JOURNAVX for the treatment of moderate-to-severe acute pain; pain, and the anticipated launch of povetacicept for the treatment of IgAN; •our ability to maintain and obtain adequate reimbursement for our products and product candidates, our ability to launch, commercialize and market our products or any of our other therapies for which we obtain regulatory approval, and our ability to obtain label expansions for existing therapies; •our expectations regarding our ability to continue to grow our CF business by increasing the number of people with CF eligible and able to receive our medicines and providing improved treatment options for people who are already eligible for one of our medicines; medicines, and our beliefs that the majority of people with CF will transition to ALYFTREK over time; •our beliefs regarding the support provided by clinical trials and preclinical and nonclinical studies of our therapies for further investigation, clinical trials or potential use as a treatment, including with respect to povetacicept as a pipeline-in-a-product and as a potential best-in-class approach for the treatment of IgAN, pMN, and gMG; •the data that will be generated by ongoing and planned clinical trials and the ability to use that data to advance compounds, continue development, support regulatory filings, or accelerate regulatory approval, including our plans to share data in 2025 from complete the ongoing clinical trial full submission for potential accelerated approval of VX-522 povetacicept in patients with CF IgAN in the first half of 2026 and to share data from Part B the interim analysis of the ongoing Phase 2/3 clinical trial evaluating VX-264 of inaxaplin in patients with T1D, AMKD in late 2026 or early 2027 and our plans to file for accelerated regulatory approvals based on interim analyses from the AMPLITUDE study Phase 2 trial in people with AMKD and the RAINIER study in IgAN; mid-2026; •our beliefs that ALYFTREK will provide additional clinical benefits to eligible people with CF, regarding the durable efficacy and effectiveness of CASGEVY as one-time functional cure for people with SCD and TDT, and regarding the clinical benefits of JOURNAVX without the evidence of the several limitations of other available therapies; •our beliefs regarding the support provided by clinical trials and preclinical and nonclinical studies of our therapies for further investigation, clinical trials or potential use as a treatment; •our plans to continue investing in our research and development programs, including anticipated timelines for our programs, and our strategy to develop our pipeline programs, alone or with third party-collaborators; third-party collaborators; •our beliefs regarding the approximate patient populations for the disease areas on which we focus; •the potential benefits and therapeutic scope of our acquisitions and collaborations, including our acquisition of Alpine and its lead asset, povetacicept, its potential to become a pipeline-in-a-product, and our expectations regarding the Zai collaboration; our agreements with Zai, Ono and WuXi; •our expectations regarding the lower royalty burden for ALYFTREK; •our plans to expand, strengthen, and invest in our global supply chains and manufacturing infrastructure and capabilities, including for biologic and cell and gene therapies; •the effects of import and export licensing requirements, tariffs, trade barriers, and other trade and travel restrictions; •potential business development activities, including the identification of potential collaborative partners or acquisition targets; •our ability to expand and protect our intellectual property portfolio and otherwise maintain exclusive rights to products; •our expectations or beliefs regarding any legal proceedings in which we are involved, including any litigation, arbitration or other similar proceedings involving our products, product candidates or activities; •the establishment, development and maintenance of collaborative relationships, including potential milestone payments or other obligations; •potential fluctuations in foreign currency exchange rates and the effectiveness of our foreign currency management program; •our expectations regarding the amount of cash to generated by operations, our cash balance and expected generation and interest income; •our expectations regarding our provision for or benefit from income taxes and the utilization of our deferred tax assets; •our ability to use our research programs to identify and develop new product candidates to address serious diseases and significant unmet medical needs; •the effectiveness of our governance, plans and strategy with respect to managing cybersecurity risks and other threats to our information technology systems; •our ability to effectively implement artificial intelligence systems and tools; •our ability to attract and retain skilled personnel; •our expectations involving governmental cost containment and other regulatory efforts; •our expectations surrounding the competitive landscape facing our products and product candidates; and •our liquidity and our expectations regarding the possibility of raising additional capital. Forward-looking statements are subject to certain risks, uncertainties, or other factors that are difficult to predict and could cause actual events or results to differ materially from those indicated in any such statements. These risks, uncertainties, and other factors include, but are not limited to, those described in our Risk Factors, set forth in Part I, Item 1A, and elsewhere in this report and those described from time to time in our future reports filed with the Securities and Exchange Commission. Any such forward-looking statements are made on the basis of our views and assumptions as of the date of the filing and are not estimates of future performance. Except as required by law, we undertake no obligation to publicly update any forward-looking statements. The reader is cautioned not to place undue reliance on any such statements.

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