Nature of the Business

12 Months Ended

Dec. 31, 2018

Nature of the Business

1. Nature of the Business

Achillion Pharmaceuticals, Inc. (the “Company”) was incorporated on August 17, 1998 in Delaware. The Company is a clinical-stage biopharmaceutical company focused on advancing its oral small molecule complement system inhibitors into late-stage development and commercialization. Each of the product candidates in the Company’s portfolio was discovered in the Company’s laboratories and is wholly owned by the Company. The Company is focusing its product development activities on complement-mediated diseases where there are no approved therapies or significant unmet medical need persists despite existing therapies.

The Company is currently advancing novel orally administered small molecules from its platform that target complement factor D, an essential protein of the alternative pathway. The Company believes that the alternative pathway plays a critical role in a number of disease conditions including the therapeutic areas of nephrology, hematology, ophthalmology and neurology. Initially the Company is targeting C3 glomerulopathy (“C3G”), and immune complex membranoproliferative glomerulonephritis (“IC-MPGN”), two related rare diseases affecting the kidney, and paroxysmal nocturnal hemoglobinuria (“PNH”), a blood disorder. The Company plans to expand its portfolio into additional indications where it believes an overactive alternative pathway plays an important role in disease pathogenesis.

The Company incurred losses of $70,272, $85,236, and $61,706 for the years ended December 31, 2018, 2017 and 2016, respectively. The Company had an accumulated deficit of $672,926 at December 31, 2018. The Company has funded its operations primarily through the sale of equity securities.

Based on the Company’s current development plan, the Company believes that its existing cash, cash equivalents and marketable securities will be sufficient to meet its current projected operating requirements for at least the next 12 months from the issuance of these financial statements. However, the Company’s future capital requirements may change and will depend upon numerous factors, including but not limited to:

• the scope, progress, results and costs of drug discovery, preclinical development, laboratory testing and clinical trials for the Company’s product candidates;

• the Company’s ability to enter into and the terms and timing of any collaborations, licensing or other arrangements that it may establish;

• the number of future product candidates that the Company pursues and their development requirements;

• the outcome, timing and costs of seeking regulatory approvals;

• the costs of commercialization activities for any of the Company’s product candidates that receive marketing approval to the extent such costs are not the responsibility of any collaborators, including the costs and timing of establishing product sales, marketing, distribution and manufacturing capabilities;

• subject to receipt of marketing approval, revenue, if any, received from commercial sales of the Company’s product candidates;

• the Company’s headcount growth and associated costs as, and when, it seeks to expand its clinical development capabilities and establish a commercial infrastructure;

• the costs involved in preparing, filing, prosecuting, maintaining, enforcing and defending patent and other intellectual property rights and defending against intellectual property-related claims;

• the Company’s ability to raise debt or equity capital, including any changes in the credit or equity markets that may impact its ability to obtain capital in the future;

• the costs associated with, and the outcome of, lawsuits against the Company, if any;

• the Company’s acquisition and development of new technologies and product candidates; and

• competing technological and market developments, including those currently unknown to the Company.