What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2022-07-19 compared with 2021-07-29 · 424 added, 432 removed, 1150 unchanged (43% of the section changed)

2 unchanged sentences

You should carefully consider the risks described below, as well as the other information in this Annual Report, including

our financial statements and the related notes and the section of this Annual Report titled “Management’s Discussion and Analysis

of Financial Condition and Results of Operations,”

before deciding whether to invest in our common stock.

our financial statements and the related notes and the section of this Annual Report titled “Management’s Discussion and Analysis

of Financial Condition and Results of Operations,” before deciding whether to invest in our common stock.

The occurrence of any

3 unchanged sentences

and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations.

Risks Related to Our Company, Preclinical Stage

Risks Related to Our Company, Early Clinical-Stage

of Development and Financial Condition

We are at a preclinical stage of development and currently have

no source of near-term revenue and may never become profitable.

We are a preclinical stage

We are at an early clinical-stage of development

and currently have no source of near-term revenue and may never become profitable.

We are an early clinical-stage

biopharmaceutical company.

Currently, we have no products approved for commercial sale and, to date, we have not generated any revenue.

We have recently initiated clinical trials for our AL001 and AL002 programs.

To date, we have not initiated

or completed a pivotal clinical trial, obtained marketing approval for any product candidates, manufactured a commercial scale product

or arranged for a third party to do so on our behalf, or conducted sales and marketing activities necessary for successful product commercialization.

Our ability to generate revenue depends heavily on, among other developments:

4 unchanged sentences

• market acceptance of AL001 and AL002.

We only have two product candidates,

AL001 and AL002, which will require extensive clinical evaluation, regulatory review and approval, significant marketing efforts and substantial

We only have two product candidates, AL001

and AL002, which will require extensive clinical evaluation, regulatory review and approval, significant marketing efforts and substantial

investment before either or both of them, and any respective successors, will provide us with any revenue.

As a result, if we do not successfully

develop, achieve regulatory approval and commercialize AL001 or AL002, we will be unable to generate any revenue for many years,

develop, achieve regulatory approval for and commercialize AL001 or AL002, we will be unable to generate any revenue for many years,

We do not anticipate that we will generate revenue for a few years, at the earliest, or that we will achieve profitability

16 unchanged sentences

that we will successfully address any of these contingencies.

We will need, but may be unable to obtain,

funding on satisfactory terms, which could dilute our stockholders and investors, or impose burdensome financial restrictions on our business.

We have relied upon cash

from financing activities and in the future, we hope to rely on revenues generated from operations to fund all of the cash requirements

of our activities.

We will need, but may be unable to obtain, funding on

satisfactory terms, which could dilute our stockholders and investors, and/or impose burdensome financial restrictions on our business.

We have relied upon cash from

financing activities and in the future, we hope to rely on revenues generated from operations to fund all of the cash requirements of

our activities.

However, it is extremely unlikely that we will be able to generate any significant cash from our operating activities

in the foreseeable future.

Future financings may not be available on a timely basis, in sufficient amounts or on terms acceptable to

us, if at all.

Any debt financing or other financing of securities senior to our common stock will likely include financial and other

covenants that will restrict our flexibility.

Any failure to comply with these covenants may cause an event of default and acceleration

of the obligation to pay the debt, which would have a material adverse effect on our business, prospects, financial condition and results

of operations and we could lose our existing sources of funding and impair our ability to secure new sources of funding.

no assurance that we will be able to generate any further investor interest in our securities or other types of funding, in which case

you would likely lose the entirety of your investment in us.

Future financings may not be available on a timely basis, in sufficient amounts or on terms acceptable to us,

Any debt financing or other financing of securities senior to our common stock will likely include financial and other covenants

that will restrict our flexibility.

Any failure to comply with these covenants may cause an event of default and acceleration of the obligation

to pay the debt, which would have a material adverse effect on our business, prospects, financial condition and results of operations

and we could lose our existing sources of funding and impair our ability to secure new sources of funding.

There can be no assurance that

we will be able to generate any further investor interest in our securities or other types of funding, in which case you would likely

lose the entirety of your investment in us.

Risks Related to Our Product Candidates

2 unchanged sentences

Research Foundation.

There are certain initial

license fees and milestone payments required to be paid by us to the University of South Florida Research Foundation, Inc., as licensor,

pursuant to the terms of license agreements we have entered into with the licensor.

The license agreements for AL002 require us to pay

royalty payments of 4% on net sales of products developed from the licensed technology for AL002 while the license agreements for AL001

require that we pay combined royalty payments of 4.5% on net sales of products developed from the licensed technology for AL001.

already paid an initial license fee of $200,000 for AL002 and an initial license fee of $200,000 for AL001.

As an additional licensing

fee for the license of AL002, the licensor received 3,601,809 shares of our common stock.

As an additional licensing fee for the license

of the AL001 technologies, the licensor received 2,227,923 shares of our common stock.

Minimum royalties for AL001 are $25,000 in 2023,

$45,000 in 2024 and $70,000 in 2025 and every year thereafter, for the life of the agreement.

Minimum royalties for AL002 are $20,000

in 2022, $40,000 in 2023 and $50,000 in 2024 and every year thereafter, for the life of the respective agreement.

Additionally, we are

required to pay milestone payments on the due dates to the licensor for the license of the AL001 technologies and for the AL002 technology,

There are certain license fees and milestone

payments required to be paid by us to the Licensor, pursuant to the terms of license agreements we have entered into with the Licensor.

The license agreements for AL002 require us to pay royalty payments of 4% on net sales of products developed from the licensed technology

for AL002 while the license agreements for AL001 require that we pay combined royalty payments of 4.5% on net sales of products developed

from the licensed technology for AL001.

We have already paid an initial license fee of $200,000 for AL002 and an initial license fee of

$200,000 for AL001.

As an additional licensing fee for the license of AL002, the Licensor received 3,601,809 shares of our common stock.

As an additional licensing fee for the license of the AL001 technologies, the Licensor received 2,227,923 shares of our common stock.

Minimum royalties for AL001 are $25,000 in 2023, $45,000 in 2024 and $70,000 in 2025 and every year thereafter, for the life of the agreement.

Minimum royalties for AL002 are $20,000 in 2022, $40,000 in 2023 and $50,000 in 2024 and every year thereafter, for the life of the respective

Additionally, we are required to pay milestone payments on the due dates to the Licensor for the license of the AL001 technologies

and for the AL002 technology, as follows:

Original AL001 License :

Completed September 2019

Pre-IND meeting

Completed June 2021

IND application filing

12 months from IND filing date

Completed December 2021

Upon first dosing of patient in a clinical trial

12 months from first patient dosing

Completed March 2022

Upon Completion of first clinical trial

24 months from completion of the first clinical trial

12 months from completion of the first Phase II clinical trial

Upon first patient treated in a Phase III clinical trial

1 unchanged sentence

Upon FDA approval

have met the Pre-IND meeting and IND application filing milestones encompassing AL001.

If we fail to meet a milestone payment by the specified

date, the licensor may terminate the respective license agreement.

If the licensor were to terminate either license agreement for whatever

reason, it would materially and adversely affect our business, financial position and future prospects and you would likely lose the entirety

of your investment in us.

*Milestone met and completed

have met the pre-IND meeting, IND application filing, and successfully completed the Phase I clinical trial milestones encompassing AL001.

If we fail to meet a milestone payment by the specified date, the Licensor may terminate the respective license agreement.

If the Licensor

were to terminate either license agreement for whatever reason, it would materially and adversely affect our business, financial position

and future prospects and you would likely lose the entirety of your investment in us.

AL002 License:

January 1, 2022

IND application filing

Completed January 2022

Upon IND application filing

12 months from IND application filing date

2 unchanged sentences

Upon completion of first Phase I clinical trial

24 months from completion of first Phase I Trial

24 months from completion of first Phase I clinical trial

Upon completion of first Phase II clinical trial

2 unchanged sentences

7 years from the effective date of the agreement

Upon receipt of FDA BLA approval

On June 10, 2020, we obtained two additional

royalty-bearing exclusive worldwide licenses from the licensor to a therapy named AL001.

One of the additional licenses is for the treatment

of neurodegenerative diseases excluding Alzheimer’s and the other license is for the treatment of psychiatric diseases and disorders.

There are certain license fees and milestone payments required to be paid pursuant to the terms of the Standard Exclusive License Agreements

with Sublicensing Terms, both dated June 10, 2020 and effective as of November 1,

2019, with the licensor and the University of South Florida (the “June AL001 License Agreements”).

Under each of the June

AL001 License Agreements, a royalty payment of 3% is required on net sales of products developed from the licensed technology.

two additional AL001 licenses, in the aggregate, we paid initial license fees of $20,000.

Additionally, under each of the June AL001 License

Agreements, we are required to pay milestone payments on the due dates to the licensor for the license of the technology, as follows:

Upon FDA BLA approval

*Milestone met and completed

On June 10, 2020, we

obtained two additional royalty-bearing exclusive worldwide licenses from the Licensor to a therapy named AL001.

One of the additional

licenses is for the treatment of neurodegenerative diseases excluding Alzheimer’s and the other license is for the treatment of

psychiatric diseases and disorders.

There are certain license fees and milestone payments required to be paid pursuant to the terms of

the June AL001 License Agreements.

Under each of the June AL001 License Agreements, a royalty payment of 3% is required on net sales of

products developed from the licensed technology.

For the two additional AL001 licenses, in the aggregate, we paid initial license fees

Additionally, under each of the June AL001 License Agreements, we are required to pay milestone payments on the due dates

to the Licensor for the license of the technology, as follows:

Additional AL001 Licenses:

Upon first pre-IND meeting

Pre-IND meeting

December 31, 2022

Upon IND application filing

IND application filing

5 unchanged sentences

Upon first patient treated in a Phase III clinical trial

August 1, 2029

8 years from the effective date of the agreement

First commercial sale

These license agreements have

an indefinite term that continue until the later of the date no licensed patent under the applicable agreement remains a pending application

or enforceable patent, the end date of any period of market exclusivity granted by a governmental regulatory body, or the date on which

the licensee’s obligations to pay royalties expire under the applicable license agreement.

These June AL001 License Agreements

have an indefinite term that continue until the later of the date no licensed patent under the applicable agreement remains a pending

application or enforceable patent, the end date of any period of market exclusivity granted by a governmental regulatory body, or the

date on which the licensee’s obligations to pay royalties expire under the applicable license agreement.

If we fail to comply with our obligations

56 unchanged sentences

trade secrets, and regulatory exclusivity for AL001 and AL002;

the effectiveness of our and our eventual partners’

marketing, sales and distribution strategy and

• the effectiveness of our and our eventual partners’ marketing, sales and distribution strategy and

• the ability of our third-party manufacturers to manufacture supplies of our product and product candidates

11 unchanged sentences

significantly limit our ability to generate revenue.

Even if we develop AL001 or

AL002 and gain regulatory approvals for either or both candidates, unless physicians and patients accept our product candidates, we may

not be able to sell them and generate significant revenues.

We cannot assure you that AL001, AL002 or any other potential products will

achieve market acceptance and revenue if and when they obtain the requisite regulatory approvals.

Market acceptance of any product candidate

depends on a number of factors, including but not limited to:

Even if we develop AL001 or AL002 and gain

regulatory approvals for either or both candidates, unless physicians and patients accept our product candidates, we may not be able to

sell them and generate significant revenues.

We cannot assure you that AL001, AL002 or any other potential product candidates we may eventually

develop will achieve market acceptance and revenue if and when they obtain the requisite regulatory approvals.

Market acceptance of any

product candidate depends on a number of factors, including but not limited to:

• the indication and warnings approved by regulatory authorities in the product label;

• continued demonstration to the FDA of safety and efficacy in commercial use;

physicians’

willingness to prescribe the product;

• physicians’ willingness to prescribe the product;

• reimbursement from third-party payers such as government health care systems and insurance companies;

1 unchanged sentence

• the nature of any post-approval risk management plans mandated by regulatory authorities;

• competition;

• the effectiveness of marketing and distribution support.

7 unchanged sentences

The manufacturing of AL001 and AL002 necessitates compliance with

applicable regulatory requirements of the FDA and the European Union, as well as with international current Good Manufacturing Practice

(“cGMP”) and other international regulatory requirements.

As of the date of this Annual Report, we do not have our own manufacturing

We have contracted with a third-party manufacturer for the clinical supply using GMP manufacturing for our planned AL001 clinical

trials and plan to contract with established third parties for the long-term commercial production of AL001 and AL002.

The responsibility

to obtain market authorization for AL001 and AL002 remains with us.

As such, even if we could potentially have a claim against one or

more third parties, we are legally liable for any noncompliance related to AL001 and AL002 and we expect to retain legal responsibility

for any future product candidates as well.

Additionally, we may have

limited control over the associated manufacturing costs and potential unexpected increases in those costs over time.

If costs increase,

we may choose to pass on such costs to our customers, which could reduce our ability to compete by increasing the prices of our products

(which we expect to be priced at a significant premium over competing generic products).

See “—

Risks Related to Our Business

and Industry —

We expect to face substantial competition, with other entities possibly discovering, developing or commercializing

products before, or more successfully than, we do.”

If we cannot pass on all such costs to our customers, then our profitability

may be adversely affected.

applicable regulatory requirements of the FDA and the European Union, as well as with international cGMP and other international regulatory

requirements.

As of the date of this Annual Report, we do not have our own manufacturing facilities.

We have contracted with a third-party

manufacturer for the clinical supply of AL001 using GMP manufacturing for our planned AL001 clinical trials and plan to contract with

established third parties for the long-term commercial production of AL001 and AL002.

The responsibility to obtain market authorization

for AL001 and AL002 remains with us.

As such, even if we could potentially have a claim against one or more third parties, we are legally

liable for any noncompliance related to AL001 and AL002 and we expect to retain legal responsibility for any future product candidates

Additionally, we may have limited control

over the associated manufacturing costs and potential unexpected increases in those costs over time.

If costs increase, we may choose

to pass on such costs to our customers, which could reduce our ability to compete by increasing the prices of our products (which we expect

to be priced at a significant premium over competing generic products).

See “Risks Related to Our Business and Industry — We

expect to face substantial competition, with other entities possibly discovering, developing or commercializing products before, or more

successfully than, we do.” If we cannot pass on all such costs to our customers, then our profitability would be adversely affected.

If we are unable to manufacture,

19 unchanged sentences

our business, results of operations and financial condition.

See also “Risks Related to Development and Regulatory Approval of Our

Product.”

The regulatory approval process is uncertain, requires us to utilize significant financial, physical and human resources,

See also “Risks Related to Development and Regulatory Approval of Our

Product.” The regulatory approval process is uncertain, requires us to utilize significant financial, physical and human resources,

and may prevent us or our future commercial partners from obtaining approvals for the commercialization of some or all of our product

9 unchanged sentences

• regulatory authorities may require certain labeling statements, such as warnings or contraindications

or limitations on the indications for use, or impose restrictions on distribution in the form of a Risk Evaluation and Mitigation Strategy

“REMS”), in connection with approval, if any;

or limitations on the indications for use, or impose restrictions on distribution in the form of REMS in connection with approval, if

• regulatory authorities may withdraw their approval, require more onerous labeling statements or impose

7 unchanged sentences

demonstrate that either AL001 or AL002 is unlikely to receive regulatory approval or is unlikely to be successfully commercialized.

addition, regulatory agencies, an Ethics Committee or Institutional Review Board (an “IRB”), or data safety monitoring boards

may at any time recommend the temporary or permanent discontinuation of our clinical trials or request that we cease using investigators

20 unchanged sentences

Additionally, even if there is some form of reimbursement and coverage from third-party payers, if the level of third-party reimbursement

is insufficient from the patient’s perspective or coverage is limited, our revenue and gross margins will be materially and adversely

A current trend in the U.S.

31 unchanged sentences

we nor any commercial partner is permitted to market any of our current or future product candidates in the United States until we receive

approval from the FDA of either an NDA or BLA for AL001 and AL002, respectively.

approval from the FDA of either a NDA or BLA for AL001 and AL002, respectively.

Obtaining approval of an NDA or a BLA can be an uncertain

10 unchanged sentences

Even if we fully comply with

all applicable laws and regulations, the FDA may still determine that our clinical data is insufficient for final approval of an NDA or

all applicable laws and regulations, the FDA may still determine that our clinical data are insufficient for final approval of an NDA

The process required by the FDA and most foreign regulatory authorities before human health care pharmaceuticals may be marketed

16 unchanged sentences

In addition, separate regulatory

approvals are required in order to market any product in many jurisdictions, including the United States, the European Economic Area,

which consists of the 28 Member States (known as the “EU Member States”) of the European Union plus Norway, Iceland and Liechtenstein,

and many others.

Approval procedures vary among countries and can involve additional studies and testing, and the time required to obtain

approval may differ from that required to obtain FDA approval.

Studies conducted in one country may not be accepted by regulatory authorities

in other countries.

Approval by the FDA does not ensure approval by regulatory authorities in other countries, and approval by one or

more foreign regulatory authorities does not ensure approval by regulatory authorities in other foreign countries or by the FDA.

a failure or delay in obtaining regulatory approval in one country may have a negative effect on the regulatory process in others.

foreign regulatory approval process may include all of the risks associated with obtaining FDA approval.

We may be unable to file for

regulatory approvals or do so on a timely basis and, even if we are able to, we may not receive necessary approvals to commercialize our

products in any market.

Any of these results could have a material adverse effect on our business, results of operations and financial

approvals are required in order to market any product in many jurisdictions, including the United States, the United Kingdom, European

Economic Area, which consists of the 27 Member States (known as the “EU Member States”) of the European Union plus Norway,

Iceland and Liechtenstein, and many others.

Approval procedures vary among countries and can involve additional studies and testing, and

the time required to obtain approval may differ from that required to obtain FDA approval.

Studies conducted in one country may not be

accepted by regulatory authorities in other countries.

Approval by the FDA does not ensure approval by regulatory authorities in other

countries, and approval by one or more foreign regulatory authorities does not ensure approval by regulatory authorities in other foreign

countries or by the FDA.

However, a failure or delay in obtaining regulatory approval in one country may have a negative effect on the

regulatory process in others.

The foreign regulatory approval process may include all of the risks associated with obtaining FDA approval.

We may be unable to file for regulatory approvals or do so on a timely basis and, even if we are able to, we may not receive necessary

approvals to commercialize our products in any market.

Any of these results could have a material adverse effect on our business, results

of operations and financial condition.

There is a high rate of failure for drug

9 unchanged sentences

In the event that

we obtain negative or inconclusive results from the AL001 or AL002 from a clinical trial;

the FDA places a clinical hold on our clinical trials due to potential chemistry, manufacturing and controls

(i) we obtain negative or inconclusive results from the AL001 or AL002 from a clinical trial,

(ii) the FDA places a clinical hold on our clinical trials due to potential chemistry, manufacturing and controls

issues or other hurdles, or

the FDA does not approve our NDA for AL001 or our Biologics License Application (“BLA”) for

(iii) the FDA does not approve our NDA for AL001 or our BLA for AL002, then:

• we may not be able to generate sufficient revenue or obtain financing to continue our operations;

4 unchanged sentences

materially and adversely affect our business, results of operations or financial condition.

Nearly every attempt

at drug approval for Alzheimer’s has failed.

billions of dollars invested by the National Institute of Health and the biopharmaceutical industry in research programs to develop novel

therapeutics for Alzheimer’s, the FDA has not approved any new drugs for Alzheimer’s

since 2003, except, however, that in June 2021, aducanumab (Biogen, Inc) received approval from the FDA for the treatment of Alzheimer’s

using the accelerated approval pathway.

Since 2003, many new types and classes of drugs have been developed and tested in Alzheimer’s,

including monoclonal antibodies, gamma secretase modulators and inhibitors, β-site amyloid precursor protein cleaving enzyme (BACE)

inhibitors, receptor for advanced glycation end-products (RAGE) inhibitors, nicotinic partial agonists and allosteric modulators, serotonin

subtype receptor (5HT6) antagonists, and others.

Except for Biogen’s approval, referred to above, virtually all of these scientific

programs have failed in clinical testing.

Clinical trials for AL001 or AL002 can be

expensive, time consuming, uncertain and susceptible to change, delay or termination.

Clinical trials are expensive,

time consuming and difficult to design and implement.

The result of a clinical trial may be undesirable and can result in a clinical trial

cancellation or the need for re-evaluation and supplementation.

Even if the results of our clinical trials are favorable, the clinical

trials for AL001 or AL002 are expected to continue for a few years and may even take significantly longer to complete.

we, the FDA, an IRB, or other regulatory authority, including in the United States, European Union and elsewhere, may suspend, delay or

terminate our clinical trials at any time, for various reasons, including, without limitation:

Clinical trials are expensive, time consuming

and difficult to design and implement.

The result of a clinical trial may be undesirable and can result in a clinical trial cancellation

or the need for re-evaluation and supplementation.

Even if the results of our clinical trials are favorable, the clinical trials for AL001

or AL002 are expected to continue for a few years and may even take significantly longer to complete.

In addition, we, the FDA, an

IRB, or other regulatory authority, whether in the United States, European Union or elsewhere, may suspend, delay or terminate our clinical

trials at any time, for various reasons, including, without limitation:

• lack of effectiveness of AL001 or AL002 during clinical trials;

7 unchanged sentences

• inadequacy of or changes in our manufacturing process or product formulation;

delays in obtaining regulatory authorization to commence a trial, including experiencing “clinical

or delays requiring suspension or termination of a trial by a regulatory agency, such as the FDA, before or after a trial

• delays in obtaining regulatory authorization to commence a trial, including experiencing “clinical

holds” or delays requiring suspension or termination of a trial by a regulatory agency, such as the FDA, before or after a trial

is commenced;

4 unchanged sentences

• unfavorable results from ongoing preclinical studies and clinical trials;

failure of any contract research organizations (“CROs”) that we may partner with in the future,

• failure of any contract research organizations (“CROs”) that we may partner with in the future,

or other third-party contractors, to comply with all contractual requirements or to perform their services in a timely or acceptable manner;

6 unchanged sentences

foregoing could have a material adverse effect on our business, results of operations and financial condition.

See “—

is a high rate of failure for drug candidates proceeding through clinical trials”

See the risk factor “There

is a high rate of failure for drug candidates proceeding through clinical trials” above.

If our products do not receive breakthrough

therapy designation, it could potentially increase the FDA’s review time and adversely impact our development timeline.

the FDA grants breakthrough therapy designation, it does not guarantee faster product development or FDA review and does not necessarily

7 unchanged sentences

designation for both AL001 and AL002.

However, we have not received breakthrough therapy designation or have qualified for expedited development,

and no assurance can be given that we will be able to do so.

Even if we qualify for breakthrough therapy designation or expedited development,

it may not actually lead to faster development or expedited regulatory review and approval or necessarily increase the likelihood that

we will receive FDA approval.

However, we have not received breakthrough therapy designation or have qualified for

expedited development, and no assurance can be given that we will.

Even if we qualify for breakthrough therapy designation or expedited

development, it may not actually lead to faster development or expedited regulatory review and approval or necessarily increase the likelihood

that we will receive FDA approval.

Even if we believe that our

6 unchanged sentences

our development process.

There is no guarantee that, even with the FDA’s assistance through the breakthrough therapy designation,

that the development process will be accelerated, the FDA will review or approve our submissions in a timely manner, or that our product

2 unchanged sentences

that our product candidates will receive breakthrough therapy designations and, even if they do, we cannot guarantee that such designations

will have any bearing on the FDA’s review or approval of our product candidates.

Even if we receive regulatory approval for

79 unchanged sentences

We plan to seek full FDA approval

in the United States for AL001 and AL002 to treat Alzheimer’s.

If AL001 or AL002 is approved, the FDA will restrict our ability

to market or advertise it for the treatment of indications other than the one for which it is approved, which would limit its use.

we decide to attempt to develop, promote and commercialize new treatment indications and protocols for AL001, AL002 and potentially other

product candidates in the future, we could not predict when, or if, we would ever receive the approvals required to do so.

required to conduct additional studies to support such applications for additional use, which would consume additional resources and may

produce results that do not result in FDA approvals.

If we do not obtain additional FDA approvals, our ability to expand our business

in the United States would be adversely affected, which could materially and adversely affect our business, results of operations and

financial condition.

in the United States for AL001 and AL002 to treat neurodegenerative diseases and psychiatric disorders, including Alzheimer’s.

addition, we have submitted a pre-IND meeting request with the FDA to explore AL001 for the treatment of bipolar disorder, MDD and PTSD.

If AL001 or AL002 is approved, the FDA will restrict our ability to market or advertise it for the treatment of indications other than

the one for which it is approved, which would limit its use.

If we decide to attempt to develop, promote and commercialize new treatment

indications and protocols for AL001, AL002 and potentially other product candidates in the future, we could not predict when, or if, we

would ever receive the approvals required to do so.

We would be required to conduct additional studies to support such applications for

additional use, which would consume additional resources and may produce results that do not result in FDA approvals.

If we do not obtain

additional FDA approvals, our ability to expand our business in the United States would be adversely affected, which could materially

and adversely affect our business, results of operations and financial condition.

The anticipated development of a REMS for

4 unchanged sentences

REMS elements can

include medication guides, communication plans for health care professionals, and elements to assure safe use (“ETASU”).

ETASU’s

include medication guides, communication plans for health care professionals, and elements to assure safe use (“ETASU”).

can include, but are not limited to, special training or certification for prescribing or dispensing, dispensing only under certain circumstances,

1 unchanged sentence

Moreover, product approval may require substantial post-approval testing and surveillance

to monitor the drug’s safety or efficacy.

We may be required to adopt a REMS for AL001 or AL002 to ensure that the benefits outweigh

13 unchanged sentences

of operations and financial condition.

If we are found in violation of “fraud

and abuse”

laws, we may be subject to criminal and civil penalties and/or be suspended or excluded from participation in government-run

If we are found in violation of “fraud

and abuse” laws, we may be subject to criminal and civil penalties and/or be suspended or excluded from participation in government-run

health care programs, which may adversely affect our business, financial condition and results of operations.

If we are successful in obtaining

marketing approval for our products in the United States and elsewhere, we will be subject to various health care “fraud and abuse”

laws, including anti-kickback laws, false claims laws and other laws intended to reduce fraud and abuse in government-run health care

21 unchanged sentences

to governmental health care programs.

Under laws such as the Health Insurance Portability and Accountability Act of 1996 in the U.S.,

we are prohibited from knowingly and willfully executing a scheme to defraud any health care benefit program, including private payers,

or knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent

statement in connection with the delivery of or payment for health care benefits, items or services.

Violations of fraud and abuse laws

may be punishable by criminal and/or civil sanctions, including fines and/or exclusion or suspension from government-run health care programs

such as Medicare and Medicaid and debarment from contracting with the U.S.

Under laws such as the Health Insurance Portability and Accountability Act of 1996 in the United

States, we are prohibited from knowingly and willfully executing a scheme to defraud any health care benefit program, including private

payers, or knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or

fraudulent statement in connection with the delivery of or payment for health care benefits, items or services.

Violations of fraud and

abuse laws may be punishable by criminal and/or civil sanctions, including fines and/or exclusion or suspension from government-run health

care programs such as Medicare and Medicaid and debarment from contracting with the U.S.

and other governments.

In addition, in the United States, individuals

have the ability to bring actions on behalf of the government and potentially share in the recovery under the federal False Claims Act

as well as under state false claims laws.

In addition, in the United

States, individuals have the ability to bring actions on behalf of the government and potentially share in the recovery under the federal

False Claims Act as well as under state false claims laws.

Many states in the United

49 unchanged sentences

potential competitors include large health care companies, such as Celgene Corporation, Merck & Co., Inc., Sanofi S.A., Eli Lilly

and Company, Bayer AG, Novartis AG and Boehringer Ingelheim GmbH.

We also know of several smaller early stage companies that are developing

products for use in our segment of the market.

Some of the potential competitive compounds referred to above are being developed by large,

well-financed and established pharmaceutical and biotechnology companies or have been partnered with such companies, which may give them

development, regulatory and marketing advantages over our products.

and Company, Bayer AG, Novartis AG, Johnson and Johnson and Boehringer Ingelheim GmbH.

We also know of several smaller early-stage

companies that are developing products for use in our segment of the market.

Some of the potential competitive compounds referred to above

are being developed by large, well-financed and established pharmaceutical and biotechnology companies or have been partnered with such

companies, which may give them development, regulatory and marketing advantages over our products.

Our commercial opportunity

22 unchanged sentences

and financial condition.

Changes in funding

for the FDA and other government agencies could hinder their ability to hire and retain key leadership and other personnel, or otherwise

prevent our product candidates from being developed or commercialized in a timely manner, which could negatively impact our business.

rely on the FDA to assist with the development our product candidates.

The ability of the FDA to review and approve new drug products

can be affected by a variety of factors outside of our control, including government budget and funding levels, ability to hire and retain

key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes.

Average review times at the agency have

fluctuated in recent years as a result.

In addition, government funding of other government agencies that fund research and development

activities is subject to the political process, which is inherently fluid and unpredictable.

at the FDA and other agencies may also slow the time necessary for our product candidates to be reviewed and/or potentially approved by

necessary government agencies, which would adversely affect our business.

For example, over the last several years, including for 35 days

beginning on December 22, 2018, the U.S.

government has shut down several times and certain regulatory agencies, such as the FDA, have

had to furlough critical FDA employees and stop critical activities.

If a prolonged government shutdown occurs, it could significantly

impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our

If the timing of FDA’s review and approval of new products is delayed, the estimated timing of our drug development program

may be delayed which would materially increase costs of drug development and harm our operations or business.

Risks Related to Our Intellectual Property

42 unchanged sentences

financial compensation.

We may become subject to third parties’

claims alleging infringement of patents and proprietary rights or seeking to invalidate our patents or proprietary rights, which would

2 unchanged sentences

litigation and other proceedings regarding patent and other intellectual property rights in the pharmaceutical industry, as well as patent

challenge proceedings, including interference and administrative law proceedings before the U.S.

Patent and Trademark Office (“USPTO”)

and the European Patent Office (“EPO”), and oppositions and other comparable proceedings in other jurisdictions.

patent reform laws, new procedures including inter partes review and post grant review have been implemented.

As stated below,

the novel implementation of such laws presents uncertainty regarding the outcome of challenges to our patents in the future.

challenge proceedings, including interference and administrative law proceedings before the USPTO and the European Patent Office (“EPO”),

and oppositions and other comparable proceedings in other jurisdictions.

Recently, under U.S.

patent reform laws, new procedures including

inter partes review and post grant review have been implemented.

As stated below, the novel implementation of such laws presents uncertainty

regarding the outcome of challenges to our patents in the future.

We cannot assure you that

12 unchanged sentences

claims in the future against us or our collaborators that would cause us to incur substantial expenses and, if successful against us,

could cause us to pay substantial damages, including treble damages and attorney’s fees if we are found to be willfully infringing

a third party’s patents.

could cause us to pay substantial damages, including treble damages and attorney’s fees if we are found to be willfully infringing

a third party’s patents.

If a patent infringement suit were brought against us or our collaborators, we or our collaborators could

10 unchanged sentences

Even if we are successful in defending such claims, infringement and other intellectual

property litigation can be expensive and time-consuming to litigate and divert management’s attention from our core business.

of these events could harm our business significantly.

117 unchanged sentences

Risks Relating to Legal Matters

We received a subpoena from the Securities

and Exchange Commission in the investigation known as “In the Matter of DPW Holdings, Inc.,”

the consequences of which are

We received a subpoena from the SEC in

the investigation known as “In the Matter of DPW Holdings, Inc.,” the consequences of which are unknown.

In November 2019, we

received a subpoena from the Securities and Exchange Commission (“SEC”) that stated that the staff of the SEC is conducting

an investigation known as “In the Matter of DPW Holdings, Inc.,”

and that the subpoena was issued as part of an investigation

as to whether Ault Global Holdings, Inc., formerly known as DPW Holdings, Inc.

(“Ault Global”), and certain of its officers,

directors, employees, partners, subsidiaries and/or affiliates, and/or other persons or entities, directly or indirectly, violated certain

provisions of the Securities Act and the Exchange Act, in connection with the offer and sale of its securities.

Although the order states

that the SEC may have information relating to such alleged violations, the subpoena expressly provides that the inquiry is not to be construed

as an indication by the SEC or its staff that any violations of the federal securities laws have occurred.

During the last 18 months,

received a subpoena from the SEC that stated that the staff of the SEC is conducting an investigation known as “In the Matter of

DPW Holdings, Inc.,” and that the subpoena was issued as part of an investigation as to whether BitNile Holdings, Inc., formerly

known as DPW Holdings, Inc.

(“BitNile”), and certain of its officers, directors, employees, partners, subsidiaries and/or

affiliates, and/or other persons or entities, directly or indirectly, violated certain provisions of the Securities Act and the Exchange

Act, in connection with the offer and sale of its securities.

Although the order states that the SEC may have information relating to

such alleged violations, the subpoena expressly provides that the inquiry is not to be construed as an indication by the SEC or its staff

that any violations of the federal securities laws have occurred.

We have produced documents in response to the subpoena.

The SEC may in the future require us to produce additional documents, information

or seek testimony from other members of our management team.

in the future require us to produce additional documents, information or seek testimony from other members of our management team.

We are unaware of the scope

or timing of the SEC’s investigation.

As a result, we do not know how the SEC’s investigation is proceeding or when the investigation

or timing of the SEC’s investigation.

As a result, we do not know how the SEC’s investigation is proceeding or when the investigation

will be concluded.

6 unchanged sentences

This investigation could result in significant

legal expenses, the diversion of management’s attention from our business, damage to our business and reputation, and could subject

us to a wide range of remedies, including an enforcement action by the SEC.

Two members of our current Board of Directors, Messrs.

and Nisser, are directors of Ault Global.

There can be no assurance that any final resolution of this and any similar matters will not

have a material adverse effect on our business, financial condition or results of operations.

and Nisser, are directors of BitNile.

There can be no assurance that any final resolution of this and any similar matters will not have

a material adverse effect on our business, financial condition or results of operations.

If product liability lawsuits are brought

26 unchanged sentences

financial condition.

Risks Related to Our Affiliates’

Risks Related to Our Affiliates’ Control

and Relationships

1 unchanged sentence

over us, which could limit your ability to affect the outcome of key transactions, including a change of control.

In the aggregate, beneficial ownership of

the shares of our common stock by our directors and executive officers and their respective affiliated parties represents approximately

45.76% of the outstanding shares of our common stock.

As a result, these stockholders, if they act together, will be able to influence

our management and affairs and all matters requiring stockholder approval, including the election of directors and approval of significant

corporate transactions.

This concentration of ownership may have the effect of delaying or preventing a change in control of our company

and might affect the market price of our common stock.

In the aggregate, beneficial

ownership of the shares of our common stock by our directors and executive officers and their respective affiliated parties represents

approximately 48.2% of the outstanding shares of our common stock.

As a result, these stockholders, if they act together, will be able

to influence our management and affairs and all matters requiring stockholder approval, including the election of directors and approval

of significant corporate transactions.

This concentration of ownership may have the effect of delaying or preventing a change in control

of our company and might affect the market price of our common stock.

Members of the Board of Directors and executive

officers of our company, Ault Global and Avalanche International Corp.

contain some of the same individuals, which may present potential

conflicts of interest.

Our company is controlled

(Todd) Ault III, our Founder, Chairman Emeritus and consultant, directly and indirectly through his controlling equity interest

in Ault Life Sciences, Inc.

officers of our company and BitNile, contain some of the same individuals, which may present potential conflicts of interest.

Our company is controlled by Milton C.

Ault III, our Founder, Chairman Emeritus and consultant, directly and indirectly through his controlling equity interest in Ault &

Company, Inc.

the parent of Ault Life Sciences, Inc.

and Ault Life Sciences Fund, LLC.

Ault is also the Executive Chairman and single largest stockholder

(through Ault & Company, Inc.) of Ault Global, a publicly-traded diversified holding company focused primarily on the defense/aerospace,

industrial and telecommunications industries.

The Board of Directors and executive officers of our company and the board of directors

and executive officers of Ault Global contain some of the same individuals, all of whom devote a portion of their business and professional

time and efforts to the respective businesses of our company, Ault Global and/or Avalanche International Corp.

dba MTIX International

(“Avalanche”).

Horne, the Chairman of the Board of our company, is the Chief Executive Officer and a director of

Ault Global, Henry C.W.

Nisser, our Executive Vice President, General Counsel and a director of our company, is the President, General

Counsel and a director of Ault Global, and Kenneth S.

Cragun, our Senior Vice President of Finance is the Chief Financial Officer of Ault

Ault is also the Executive Chairman and

single largest stockholder (through his control of Ault Alpha, LP) of BitNile, a publicly-traded diversified holding company focused primarily

on the digital mining, investment, defense/aerospace, industrial and telecommunications industries.

The Board of Directors and executive

officers of our company and the board of directors and executive officers of BitNile contain some of the same individuals, all of whom

devote a portion of their business and professional time and efforts to the respective businesses of our company as well as BitNile.

Horne, the Chairman of the Board of our company, is the Chief Executive Officer and a director of BitNile, Henry C.W.

Nisser, our Executive

Vice President, General Counsel and a director of our company, is the President, General Counsel and a director of BitNile, and Kenneth

Cragun, our Senior Vice President of Finance is the Chief Financial Officer of BitNile.

Additionally, Mr.

Ault is the Chairman of Avalanche, a smaller publicly-traded company currently engaged in developing advanced

materials and processing technology for textile applications.

Horne is a director of Avalanche and its Chief Financial Officer,

Nisser is its Executive Vice President and General Counsel, and Philip E.

Mansour, our former Chief executive and a former director

of our company, is Avalanche’s Chief Executive Officer and a director.

While we believe that our

business and technologies are distinguishable from those of Ault Global and Avalanche, and that we do not compete in the markets in which

Ault Global and Avalanche compete, Mr.

Ault and the other named individuals may have potential conflicts of interest with respect

to, among other things, potential corporate opportunities, business combinations, joint ventures and/or other business opportunities that

may become available to them, our company, Ault Global and/or Avalanche.

Moreover, while Mr.

Ault and the other named individuals

have agreed to devote a portion of their business and professional time and efforts to our company, potential conflicts of interest also

include the amount of time and effort devoted by each of them to the affairs of Ault Global and Avalanche.

We may be materially adversely

affected if Mr.

Ault and/or the other named individuals choose to place the interests of Ault Global and/or Avalanche before those

of our company.

Ault and the other named individuals has agreed that, to the extent such opportunities arise, he will

carefully consider a number of factors, including whether such opportunities were presented to him in his capacity as an officer or director

of our company, whether such opportunities are within our company’s line of business or consistent with our strategic objectives

and whether our company will be able to undertake or benefit from such opportunities.

In addition, our Board of Directors has adopted

a policy whereby any future transactions between us and any of our subsidiaries, affiliates, officers, directors, principal stockholders

or any affiliates of the foregoing will be on terms no less favorable to our company than could reasonably be obtained in “arm’s

length”

transactions with independent third parties, and any such transactions will also be approved by a majority of our disinterested

outside directors.

Ault is the Chairman

of Avalanche International, Corp.

(“Avalanche”), a company currently engaged in developing advanced materials and processing

technology for textile applications.

Horne is a director of Avalanche and its Chief Financial Officer and Mr.

its Executive Vice President and General Counsel.

While we believe that our business and technologies

are distinguishable from those of BitNile and that we do not compete in the markets in which BitNile compete, Mr.

Ault and the other

named individuals may have potential conflicts of interest with respect to, among other things, potential corporate opportunities, business

combinations, joint ventures and/or other business opportunities that may become available to them, our company or BitNile.

Ault and the other named individuals have agreed to devote a portion of their business and professional time and efforts

to our company, potential conflicts of interest also include the amount of time and effort devoted by each of them to the affairs of BitNile.

We may be materially adversely affected if Mr.

Ault and/or the other named individuals choose to place the interests of BitNile before

those of our company.

Ault and the other named individuals has agreed that, to the extent such opportunities arise, he

will carefully consider a number of factors, including whether such opportunities were presented to him in his capacity as an officer

or director of our company, whether such opportunities are within our company’s line of business or consistent with our strategic

objectives and whether our company will be able to undertake or benefit from such opportunities.

In addition, our Board of Directors has

adopted a policy whereby any future transactions between us and any of our subsidiaries, affiliates, officers, directors, principal stockholders

or any affiliates of the foregoing will be on terms no less favorable to our company than could reasonably be obtained in “arm’s

length” transactions with independent third parties, and any such transactions will also be approved by a majority of our disinterested

independent directors.

The named individuals, other than Mr.

15 unchanged sentences

involving us.

In addition, through any such person’s control of our Board and voting power, the affiliate may be able to control

certain decisions, including decisions regarding the qualification and appointment of officers, dividend policy, access to capital (including

4 unchanged sentences

Risks Relating to Ownership of Our Common Stock

If we do not continue

to satisfy the Nasdaq Capital Market continued listing requirements, our common stock could be delisted from the Nasdaq Capital Market.

listing of our common stock on the Nasdaq Capital Market is contingent on our compliance with the Nasdaq Capital Market’s conditions

for continued listing.

We are currently not in compliance with Nasdaq listing requirements, specifically the minimum bid price requirement,

and must regain compliance on or prior to December 19, 2022.

If we are unable to regain such compliance, we will cease to be eligible

to trade on Nasdaq.

we were to fail to meet a Nasdaq Capital Market listing requirement, we may be subject to delisting by the Nasdaq Capital Market.

event our common stock is no longer listed for trading on the Nasdaq Capital Market, our trading volume and share price may decrease and

we may experience further difficulties in raising capital which could materially affect our operations and financial results.

delisting from the Nasdaq Capital Market could also have other negative effects, including potential loss of confidence by partners, lenders,

suppliers and employees and could also trigger various defaults under our lending agreements and other outstanding agreements.

delisting could make it harder for us to raise capital and sell securities.

You may experience future dilution as a result of future equity

In order to raise additional capital, we may in the future offer additional shares of our common stock or other securities

convertible into or exchangeable for our common stock.

We do not know whether an active market

7 unchanged sentences

other factors, the price of our common stock may fall.

The market price of our common stock may

be volatile, which could result in substantial losses for investors.

The market price of our shares

may be volatile.

Many factors may have a material adverse effect on the market price of our shares, including, but not limited to:

announcements of the failure to obtain regulatory approvals or receipt of a “complete response letter”

The market price of our common stock is

volatile, which could result in substantial losses for investors.

Our common stock is listed

on the Nasdaq Capital Market.

Since our initial public offering last year, our trading price has fluctuated widely, depending on many

factors that may have little to do with our operations or business prospects.

During the past 52-week period (through April 30, 2022),

our stock closed at prices between $0.88 per share and $13.50 per share, as reported on Nasdaq.com.

Stock markets, in general,

have experienced, and continue to experience, significant price and volume volatility, and the market price of our common stock may continue

to be subject to similar market fluctuations unrelated to our operating performance or prospects.

This increased volatility, coupled with

depressed economic conditions, could continue to have a depressive effect on the market price of our common stock.

The following factors,

many of which are beyond our control, may influence our stock price:

• announcements of the failure to obtain regulatory approvals or receipt of a “complete response letter”

from the FDA;

5 unchanged sentences

• changes or developments in laws or regulations applicable to our product candidates;

the failure of our testing and clinical trials;

• any failure of our testing and clinical trials;

• the impact of the ongoing COVID-19 pandemic on our business;

3 unchanged sentences

• the loss of any of our key scientific or management personnel;

any major changes in our Board of Directors or management;

• any major changes to our Board of Directors or management;

• the failure to obtain new commercial partners;

23 unchanged sentences

of our common stock, regardless of our actual operating performance.

Following periods of such volatility in the market price of a company’s

securities, securities class action litigation has often been brought against that company.

2 unchanged sentences

Securities litigation could result in substantial costs

and divert management’s attention and resources from our business.

A significant portion of our total outstanding

shares is restricted from immediate resale but may be sold into the market in the near future, which could cause the market price of our

common stock to decline significantly, even if our business is doing well.

Sales of a substantial number of shares of our Common Stock in the

public market could occur at any time.

These sales, upon the expiration of any or all of the lock-up agreements entered into between the

representative and each of our directors, executive officers and substantially all holders of more than 5% of our outstanding Common Stock,

as well as certain other parties (the “lock-up agreements”), the early release from these agreements or the perception in

the market that the holders of a large number of shares of our Common Stock intend to sell shares, could cause the market price of our

Common Stock to fall and could impair our ability to raise capital by selling additional securities.

As of July 12, 2021, we have 85,304,525

shares of Common Stock outstanding.

Of these shares, 2,875,000 shares that were sold in our initial public offering are freely tradable

without restriction or further registration under the Securities Act, except for any shares purchased by holders subject to lock-up agreements

or by any of our affiliates within the meaning of Rule 144 under the Securities Act, which generally includes executive officers, directors

and 10% stockholders.

Of the 85,304,525 shares of our Common Stock outstanding, a significant amount of them are locked-up as a result

of the lock-up agreements that existing stockholders have signed restricting their ability to transfer our stock for 180 days after June

Certain of these holders will be subject to a lock-up agreement that will allow them to sell, beginning 90 days after June 14,

2021 (the “Leak-Out Period Commencement Date”), up to 33.3% of their shares and any other Locked-Up Securities (as defined

herein) in any rolling 30-day period, with a daily cap of 10% of the traded volume on Nasdaq.

Holders subject to this version of the lock-up

agreement will be released from such lock-up upon the earlier of (i) the 90th day after the Leak-Out Period Commencement Date and (ii)

the meeting of certain stock price and trading volume thresholds, which release would be no earlier than the 10th trading day after the

Leak-Out Period Commencement Date.

Substantially all of the remaining shares, held by persons who are not deemed to be affiliates (at

the time of or at any time during the three months preceding a sale), were either sold by us in a Regulation A offering and are freely

transferable or are restricted securities under Rule 144, in that they were issued in private transactions not involving a public offering,

and have been beneficially owned for at least one year.

All of these remaining shares are currently eligible for sale.

In addition, the

potential future exercise of warrants and stock options to purchase our Common Stock and conversion of convertible debt instruments into

our Common Stock could result in our issuing a significant number of additional shares of Common Stock.

We have registered all shares

of Common Stock that we may issue under our stock incentive plans, which can be freely sold in the public market upon issuance and once

vested, subject to volume limitations applicable to affiliates and the lock-up agreements described above.

If any of these additional

shares are sold, or if it is perceived that they will be sold, in the public market, the market price of our Common Stock could decline

significantly, even if our business is doing well.

Because we are a closely held, potentially

thinly-traded company, there may not be an active public trading market for our shares of common stock, so investors may be unable to

sell their shares when they desire.

Digital Power Lending, LLC, a wholly-owned

subsidiary of Ault Global, purchased $10.0 million (2,000,000 shares) of common stock in the initial public offering.

Horne, our Chairman of the Board, is an executive officer and director of Ault Global, as are several other officers and board members

of our company.

Only 875,000 shares of common stock were sold to public investors with no association to our company in the initial public

Although these shares and certain other outstanding shares are freely tradable following the initial public offering, approximately

45.76% of our outstanding shares of common stock are beneficially owned by our executive officers and directors and their respective affiliates

as of July 13, 2021.

These shares and a significant number of additional shares will be restricted from sale for a limited period

of time under the terms of lock-up agreements described in the risk factor above.

Accordingly, our common stock may be thinly traded making

it more difficult to develop and maintain an active public trading market and for investors to sell their shares when they desire.

cannot give investors any assurance that the volume of trading will be sufficient to allow for timely trades.

Investors may not be able

to sell our common stock quickly or at the latest market price if trading in our shares is not active or if trading volume is limited.

In addition, if trading volume in our common stock is limited, trades of relatively small numbers of shares may have a disproportionate

effect on the market price of our common stock.

We may fail to meet our publicly announced

guidance or other expectations about our business, which would cause our stock price to decline.

We expect to provide guidance

regarding our expected financial and business performance, such as projections regarding sales and product development, as well as anticipated

future revenues, gross margins, profitability and cash flows.

Correctly identifying key factors affecting business conditions and predicting

future events is inherently an uncertain process and our guidance may not be accurate.

Our guidance is based on certain assumptions such

as those relating to anticipated FDA approval for our product candidates, the results of our clinical trials, the marketing of any of

our product candidates, among many other factors.

If our guidance is not accurate or varies from actual results due to our inability to

meet our assumptions or the impact on our financial performance that could occur as a result of various risks and uncertainties, the market

value of our common stock could decline significantly.

and divert management’s attention and resources from our business.

If there are substantial sales of shares

of our common stock, the price of our common stock could decline.

The price of our

common stock could decline if there are substantial sales of our common stock, particularly sales by our directors, executive officers

and significant stockholders, or if there is a large number of shares of our common stock available for sale and the market perceives

that sales will occur.

As of July 19, 2022, we had 95,481,790 shares of our common stock outstanding.

Shares held by directors, executive

officers and other affiliates will be subject to volume limitations under Rule 144 under the Securities Act and various vesting agreements.

We have registered shares of common stock that we have issued and may issue under our employee equity incentive plans, which shares may

be sold freely in the public market upon issuance.

Sales of our common stock by current stockholders may make it more difficult for us

to sell equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate, and make it more

difficult for other stockholders to sell shares of our common stock.

market price of the shares of our common stock could decline as a result of the sale of a substantial number of our shares of common stock

in the public market or the perception in the market that the holders of a large number of shares intend to sell their shares.

unable to predict the effect that sales may have on the prevailing market price of our common stock.

The concentration

of our stock ownership will limit your ability to influence corporate matters, including the ability to influence the outcome of director

elections and other matters requiring stockholder approval.

executive officers, directors and the holders of more than 5% of our outstanding common stock, in the aggregate, beneficially own a significant

percentage of our common stock.

As a result, these stockholders, acting together, will have significant influence over all matters that

require approval by our stockholders, including the election of directors and approval of significant corporate transactions.

actions might be taken even if other stockholders oppose them.

This concentration of ownership might also have the effect of delaying

or preventing a change of control of our company that other stockholders may view as beneficial.

Our bylaws provide that the Court of Chancery

of the State of Delaware and the federal district courts of the United States are the exclusive forums for substantially all disputes

between us and our stockholders, which could limit our stockholders’

ability to obtain a favorable judicial forum for disputes with

between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with

us or our directors, officers or employees.

13 unchanged sentences

arising under the Securities Act.

The enforceability of similar exclusive federal forum provisions in other companies’

organizational

The enforceability of similar exclusive federal forum provisions in other companies’ organizational

documents has been challenged in legal proceedings, and while the Delaware Supreme Court has ruled that this type of exclusive federal

2 unchanged sentences

These exclusive forum provisions

may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors,

officers or other employees, which may discourage such lawsuits against us and our directors, officers and other employees.

17 unchanged sentences

us and, as a result, the value of our common stock.

We have limited accounting

personnel to adequately execute our accounting processes and other supervisory resources with which to address our internal control over

financial reporting.

In connection with the audit of our financial statements as of and for the years ended April 30, 2021 and

2020, we identified material weaknesses in our internal control over financial reporting.

A material weakness is a deficiency, or combination

of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement

of our financial statements will not be prevented or detected on a timely basis.

The material weaknesses related to a lack of sufficient

number of qualified personnel within our accounting function to adequately segregate duties, to perform sufficient reviews and approval

of manual journal entries posted to the general ledger and to consistently execute review procedures over general ledger account reconciliations,

financial statement preparation and accounting for non-routine transactions and, we have not designed and implemented effective Information

Technology General Controls (ITGC) related to access controls to payment and financial accounting systems.

We have limited accounting personnel to

adequately execute our accounting processes and other supervisory resources with which to address our internal control over financial

In connection with the audit of our financial statements for the year ended April 30, 2022, we identified material

weaknesses in our internal control over financial reporting.

A material weakness is a deficiency, or combination of deficiencies,

in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our financial

statements will not be prevented or detected on a timely basis.

The material weaknesses related to a lack of sufficient number of qualified

personnel within our accounting function to adequately segregate duties, to perform sufficient reviews and approval of manual journal

entries posted to the general ledger and to consistently execute review procedures over general ledger account reconciliations, financial

statement preparation and accounting for non-routine transactions and, we have not designed and implemented effective Information Technology

General Controls (“ITGC”) related to access controls to payment and financial accounting systems.

We are implementing measures

12 unchanged sentences

required to maintain internal control over financial reporting and to report any material weaknesses in such internal controls.

with our fiscal year ending April 30, 2022, we must perform system and process evaluation and testing of our internal controls over financial

reporting to allow management to report on the effectiveness of our internal controls over financial reporting in our Form 10-K filing

for that year, as required by Section 404 of the Sarbanes-Oxley Act.

The Sarbanes-Oxley Act also requires that our independent registered

public accounting firm provides an attestation report on the effectiveness of our internal control over financial reporting, to the extent

we are no longer an “emerging growth company,”

as defined in the Jumpstart Our Business Startups Act of 2012 (JOBS Act).

do not expect our independent registered public accounting firm to provide an attestation report on the effectiveness of our internal

control over financial reporting for so long as we are an emerging growth company.

We are in the process of enhancing

our internal control over financial reporting required to comply with this obligation, which process will be time consuming, costly and

If we identify any additional material weaknesses in our internal control over financial reporting, if we are unable to comply

with the requirements of Section 404 in a timely manner, if we are unable to assert that our internal control over financial reporting

is effective, or when required in the future, if our independent registered public accounting firm is unable to express an opinion as

to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness

of our financial reports and the market price of our common stock could be adversely affected, and we could become subject to investigations

perform system and process evaluation and testing of our internal controls over financial reporting to allow management to report on the

effectiveness of our internal controls over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act.

The Sarbanes-Oxley

Act also requires that our management report on internal control over financial reporting be attested to by our independent registered

public accounting firm, to the extent we are no longer an “emerging growth company,” as defined in the Jumpstart Our Business

Startups Act of 2012 (JOBS Act).

We do not expect our independent registered public accounting firm to attest to our management report

on internal control over financial reporting for so long as we are an emerging growth company.

We are in the process of enhancing our internal

control over financial reporting required to comply with this obligation, which process will be time consuming, costly and complicated.

If we identify any additional material weaknesses in our internal control over financial reporting, if we are unable to comply with the

requirements of Section 404 in a timely manner, if we are unable to assert that our internal control over financial reporting is

effective, or when required in the future, if our independent registered public accounting firm is unable to express an opinion as to

the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of

our financial reports and the market price of our common stock could be adversely affected, and we could become subject to investigations

by the Nasdaq Stock Market, the SEC, or other regulatory authorities, which could require additional financial and management resources.

28 unchanged sentences

In addition, if we attempt to apply our technology to develop product candidates

for indications outside of Alzheimer’s, we will need to conduct genotoxicity and immunotoxicity trials, in which the results are

presently uncertain.

If we do not successfully develop and commercialize product candidates based upon our technological approach, we

will not be able to obtain product revenue in future periods, which would make it unlikely that we would ever achieve profitability.

for indications outside of Alzheimer’s, we will need to evaluate the preclinical data and determine if additional data are needed

to support the new indications.

If we do not successfully develop and commercialize product candidates based upon our technological approach,

we will not be able to obtain product revenue in future periods, which would make it unlikely that we would ever achieve profitability.

We may experience product recalls or inventory

10 unchanged sentences

or specifications.

Most of our products must be stored and transported at temperatures within a certain range, which is known as “strict

cold chain”

storage and transportation.

If these environmental conditions deviate from the norm, our products’

remaining shelf

Most of our products must be stored and transported at temperatures within a certain range, which is known as “strict

cold chain” storage and transportation.

If these environmental conditions deviate from the norm, our products’ remaining shelf

lives could be impaired or their quality could become adversely affected, making them no longer suitable for use.

49 unchanged sentences

will be subject to certain anti-corruption laws, including the U.S.

Foreign Corrupt Practices Act (“FCPA”), and other anti-corruption

laws that apply in countries where we do business.

11 unchanged sentences

EU, including applicable export control regulations, economic sanctions on countries and persons, customs requirements and currency exchange

regulations (collectively, “Trade Control Laws”).

There can be no assurance

10 unchanged sentences

incorporation, bylaws and Delaware law make it more difficult for a third party to acquire us and make a takeover more difficult to complete,

even if such a transaction were in the stockholders’

even if such a transaction were in the stockholders’ interest.

Our certificate of incorporation,

4 unchanged sentences

In general, Section 203

prohibits a public Delaware corporation from engaging in a “business combination”

with an “interested stockholder”

prohibits a public Delaware corporation from engaging in a “business combination” with an “interested stockholder”

for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business

combination is approved in a prescribed manner.

A “business combination”

includes mergers, asset sales or other transactions

A “business combination” includes mergers, asset sales or other transactions

resulting in a financial benefit to the stockholder.

An “interested stockholder”

is a person who, together with affiliates

and associates, owns, or within three years did own, 15% or more of the corporation’s outstanding voting stock.

An “interested stockholder” is a person who, together with affiliates

and associates, owns, or within three years did own, 15% or more of the corporation’s outstanding voting stock.

These provisions

3 unchanged sentences

requirements for publicly traded companies.

As a public company, we operate in an increasingly demanding regulatory

environment, which requires us to comply with the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, the regulations of The Nasdaq

Capital Market, the rules and regulations of the Securities and Exchange Commission, expanded disclosure requirements, accelerated reporting

requirements and more complex accounting rules.

Company responsibilities required by the Sarbanes-Oxley Act include establishing corporate

oversight and adequate internal control over financial reporting and disclosure controls and procedures.

Effective internal controls are

necessary for us to produce reliable financial reports and are important to help prevent financial fraud.

We must perform system and process

evaluation and testing of our internal controls over financial reporting to allow management to report on the effectiveness of our internal

controls over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act.

As a public company, we operate

in an increasingly demanding regulatory environment, which requires us to comply with the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley

Act, the regulations of The Nasdaq Capital Market, the rules and regulations of the SEC, expanded disclosure

requirements, accelerated reporting requirements and more complex accounting rules.

Company responsibilities required by the Sarbanes-Oxley

Act include establishing corporate oversight and adequate internal control over financial reporting and disclosure controls and procedures.

Effective internal controls are necessary for us to produce reliable financial reports and are important to help prevent financial fraud.

We must perform system and process evaluation and testing of our internal controls over financial reporting to allow management to report

on the effectiveness of our internal controls over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act.

We anticipate that the process

11 unchanged sentences

Our internal control over financial reporting will not prevent or detect all errors and all fraud.

system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s

objectives will be met.

18 unchanged sentences

to cover our stock, we could lose visibility in the market for our common stock, which in turn could cause our stock price to decline.

We are an “emerging growth company,”

and the reduced disclosure requirements applicable to emerging growth companies may make our common stock less attractive to investors.

We are an “emerging

growth company,”

as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act.

We are an “emerging

growth company,” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act.

For so long as we remain an emerging

3 unchanged sentences

of SOX Section 404, not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight

Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the

audit and the financial statements, reduced disclosure obligations regarding executive compensation, and exemptions from the requirements

59 unchanged sentences

the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.

We could be subject

to securities class action litigation.

the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities.

This risk is especially relevant for us because biopharmaceutical companies have experienced significant stock price volatility in recent

If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources,

which could harm our business.

UNRESOLVED STAFF COMMENTS

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors