What changed in this filing

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Item 1A. Risk Factors

2024-11-13 compared with 2024-05-14 · 104 added, 187 removed, 19 unchanged (94% of the section changed)

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facing our company.

Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially

adversely affect our business, financial condition, and/or operating results.

Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may

materially adversely affect our business, financial condition, and/or operating results.

Risks Relating to Our Business and Industry

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our product candidates.

We depend, and will continue to depend, on third parties,

including, but not limited to, CROs, clinical trial sites and clinical trial principal investigators, contract laboratories, IRBs, manufacturers,

suppliers, and other third parties to conduct our clinical trials, including those for our drug candidates bezisterim (NE3107) and BIV201.

We rely heavily on these third parties over the course of our clinical trials, and we control only certain aspects of their activities.

Nevertheless, we retain ultimate responsibility for ensuring that each of our studies is conducted in accordance with the protocol and

applicable legal, regulatory, and scientific standards and regulations, and our reliance on third parties does not relieve us of our regulatory

responsibilities.

We and these third parties are required to comply with cGCPs, which are regulations and guidelines enforced by the FDA

and comparable foreign regulatory authorities for the conduct of clinical trials on product candidates in clinical development.

authorities enforce cGCPs through periodic inspections and for-cause inspections of clinical trial principal investigators and trial sites.

If, due to the failure of either the Company or a third party, a clinical trial fails to comply with applicable cGCPs, FDA’s Investigational

New Drug (“IND”) requirements, other applicable regulatory requirements, or requirements set forth in the applicable IRB-approved

protocol, including failure to enroll a sufficient number of patients, the Company may be required to conduct additional clinical trials

to support our marketing applications, which would delay the regulatory approval process.

Moreover, our business may be implicated if

any of these third parties violates applicable federal, state, or foreign laws and/or regulations, including but not limited to FDA’s

IND regulations, fraud and abuse or false claims laws, healthcare privacy and data security laws, or provide us or government agencies

with inaccurate, misleading, or incomplete data.

For example, during routine monitoring of blinded data from our Phase 3 study (NCT04669028)

of bezisterim (NE3107), we uncovered what appears to be potential scientific misconduct and significant deviation from study protocol

and GCP violations at fifteen sites, which resulted in the Company excluding all patients from these sites and referring them to the FDA’s

OSI for further action.

The unplanned exclusion of so many patients left our Phase 3 study underpowered for the primary endpoints.

findings of potential scientific misconduct, significant deviation from protocol and GCP violations may call into question the rigor,

robustness and validity of the entire data set for this study (NCT04669028).

We depend, and will continue to depend, on third

parties, including, but not limited to, contract research organizations (“CROs”), clinical trial sites and clinical trial

principal investigators, contract laboratories, IRBs, manufacturers, suppliers, and other third parties to conduct our clinical trials,

including those for our drug candidates bezisterim (NE3107) and BIV201.

We rely heavily on these third parties over the course of our

clinical trials, and we control only certain aspects of their activities.

Nevertheless, we retain ultimate responsibility for ensuring

that each of our studies is conducted in accordance with the protocol and applicable legal, regulatory, and scientific standards and

regulations, and our reliance on third parties does not relieve us of our regulatory responsibilities.

We and these third parties are

required to comply with cGCPs, which are regulations and guidelines enforced by the FDA and comparable foreign regulatory authorities

for the conduct of clinical trials on product candidates in clinical development.

Regulatory authorities enforce cGCPs through periodic

inspections and for-cause inspections of clinical trial principal investigators and trial sites.

If, due to the failure of either the

Company or a third party, a clinical trial fails to comply with applicable cGCPs, FDA’s IND requirements, other applicable regulatory

requirements, or requirements set forth in the applicable IRB-approved protocol, the Company may be required to conduct additional clinical

trials to support our marketing applications, which would delay the regulatory approval process.

For example, our drug product candidate

bezisterim (NE3107) was cleared by FDA for use in a Phase 3, randomized, double blind, placebo controlled, parallel group, multicenter

study in subjects who have mild to moderate AD.

Enrollment in that trial began in August 2021, with a planned primary completion in late

2022/early 2023.

On November 29, 2023, the Company announced topline efficacy data from its Phase 3 clinical trial (NCT04669028) of bezisterim

(NE3107) in the treatment of mild to moderate AD.

Upon trial completion, as the Company began the process of analyzing the trial data,

the Company found significant deviations from the protocol and cGCP violations at 15 study sites (virtually all of which were from one

geographic area).

This highly unusual level of suspected improprieties led the Company to exclude all patients from these sites.

We subsequently

notified FDA’s OSI of such significant deviations from study protocol, the suspected improprieties, and the study sites involved.

The identification of significant deviations from study protocol and numerous GCP violations at multiple study sites raised questions

regarding the validity and robustness of data from these study sites.

The unplanned exclusion of so many patients left the trial underpowered

for its primary endpoints.

However, based on the remaining dataset from those other sites determined to be in compliance with the protocol

and GCP’s, a preliminary signal of efficacy was detected.

The Company is considering:

(1) employing the adaptive trial feature

of the protocol to continue enrolling patients to achieve statistical significance;

and/or (2) designing a new Phase 3 study of bezisterim

(NE3107) that leverages the most recent scientific literature relating to AD along with the company's understanding regarding the effects

of bezisterim (NE3107) in persons with mild-moderate AD.

Although we design the clinical trials for our product

candidates, our CROs are tasked with facilitating and monitoring our clinical trials.

As a result, many important aspects of our clinical

development programs, including site and investigator selection, and the conduct, timing, and monitoring of the study, is often outside

our direct control, either partially or in whole.

Our reliance on third parties to conduct clinical trials also results in less direct

control over the collection, management, and quality of data developed through clinical trials than would be the case if we were relying

entirely upon our own employees.

Communicating with third parties can also be challenging, potentially leading to mistakes as well as

difficulties in coordinating activities.

Successful development of biopharmaceuticals

is highly uncertain and is dependent on numerous factors, many of which are beyond our control.

Product candidates that appear promising in the early

phases of development may fail to reach the market for several reasons.

Pre-clinical study results may show the product candidate to be

less effective than desired (e.g., the study failed to meet its primary endpoints) or to have harmful or problematic side effects.

candidates may fail to receive the necessary regulatory approvals or may be delayed in receiving such approvals.

Among other things, such

delays may be caused by slow enrollment in clinical studies;

length of time to achieve study endpoints;

additional time requirements for

data analysis;

IND and later NDA preparation;

discussions with the FDA;

an FDA request for additional pre-clinical or clinical data;

safety or manufacturing issues;

manufacturing costs;

pricing or reimbursement issues;

clinical sites deviating from the trial protocol,

committing scientific misconduct, or other violations of regulatory requirements – which can render data from those sites unusable

in support of regulatory approval;

or other factors that make the product not economical.

Proprietary rights of others and their competing

products and technologies may also prevent the product from being commercialized.

Success in pre-clinical and early clinical studies

does not ensure that large-scale clinical studies will be successful.

Clinical results are frequently susceptible to varying interpretations

that may delay, limit or prevent regulatory approvals.

The length of time necessary to complete clinical studies and to submit an application

for marketing approval for a final decision by a regulatory authority varies significantly from one product to the next, and may be difficult

There can be no assurance that any of our products will develop successfully, and the failure to develop our products will

have a materially adverse effect on our business and will cause you to lose all of your investment.

candidates, our CROs are tasked with facilitating and monitoring these trials.

As a result, many aspects of our clinical development

programs, including site and investigator selection, and the conduct, timing, and monitoring of the study, is outside our direct control,

either partially or in whole.

Our reliance on third parties to conduct clinical trials also results in less direct control over the collection,

management, and quality of data developed through clinical trials than would be the case if we were relying entirely upon our own employees.

Communicating with third parties can also be challenging, potentially leading to mistakes as well as difficulties in coordinating activities.

Our business may be impacted if any of these third parties violates applicable federal, state, or foreign laws and/or regulations, including

but not limited to FDA’s IND regulations, cGCPs, fraud and abuse or false claims laws, healthcare privacy and data security laws,

or provide us or government agencies with inaccurate, misleading, or incomplete data.

Adverse Developments Affecting the Financial

Services Industry and Concentration of Risk

As of March 31, 2024, the Company had cash deposited

in certain financial institutions in excess of federally insured levels.

The Company regularly monitors the financial stability of these

financial institutions and believes that it is not exposed to any significant credit risk in cash and cash equivalents.

However, in March

and April 2023, certain U.S.

government banking regulators took steps to intervene in the operations of certain financial institutions

due to liquidity concerns, which caused general heightened uncertainties in financial markets.

While these and other current events have

not had a material direct impact on the Company’s operations, if further liquidity and financial stability concerns arise with respect

to banks and financial institutions, either nationally or in specific regions, the Company’s ability to access cash or enter into

new financing arrangements may be threatened, which could have a material adverse effect on its business, financial condition and results

of operations.

We are currently subject to securities class

action litigation and may be subject to similar or other litigation in the future, all of which will require significant management time

and attention, result in significant legal expenses and may result in unfavorable outcomes, which may have a material adverse effect on

our business, operating results and financial condition, and negatively affect the price of our common stock.

We are, and may in the future become, subject to various legal proceedings

and claims that arise in or outside the ordinary course of business.

For example, On January 19, 2024, a purported shareholder class action

complaint, captioned Eric Olmstead v.

3:24-cv-00035, was filed in the U.S.

District Court for the District

of Nevada, naming the Company and certain of its officers and/or directors as defendants.

On April 15, 2024 the court ordered the motion

to consolidate the six pending motions, appointed the lead plaintiff and approved selection of the lead counsel, now captioned Olmstead

BioVie Inc., et al., Case 3:24-cv-0035 LRH-CSD and Way v.

BioVie Inc., et al., Case No.

2:24-cv-00361-LRH-CSD.

The lawsuit alleges

that the Company made material misrepresentations and/or omissions of material fact relating to the Company’s business, operations,

compliance, and prospects, including information related to the study and trial of bezisterim (NE3107), in

violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder.

action is on behalf of purchasers of the Company’s securities during the period from August 5, 2021 through November 29, 2023 and

seeks unspecified monetary damages on behalf of the putative class and an award of costs and expenses, including attorney’s fees.

See Part II, Item 1 of this Quarterly Report on Form 10-Q, entitled “Legal Proceedings” for more information regarding this

It is possible that additional lawsuits will be filed,

or allegations received from stockholders, with respect to these same or other matters and also naming us and/or our officers and directors

as defendants.

Such lawsuits and any other related lawsuits are subject to inherent uncertainties, and the actual defense and disposition

costs will depend upon many unknown factors.

The outcome of such lawsuits is necessarily uncertain.

We could be forced to expend significant

resources in the defense of the pending lawsuit and any additional lawsuits, and we may not prevail.

In addition, we may incur substantial

legal fees and costs in connection with such lawsuits.

We currently are not able to estimate the possible cost to us from this matter,

as the pending lawsuit is currently at an early stage, and we cannot be certain how long it may take to resolve the pending lawsuit or

the possible amount of any damages that we may be required to pay.

Monitoring, initiating and defending against legal actions is time-consuming

for our management, is likely to be expensive and may detract from our ability to fully focus our internal resources on our business activities.

We could be forced to expend significant resources in the settlement or defense of the pending lawsuit and any potential future lawsuits,

and we may not prevail in such lawsuits.

Although we have insurance coverage that we believe

applies to these actions, the coverage is subject to a $2 million deductible.

That means that we are responsible for the first $2 million

of loss arising from these actions, which includes both defense costs and damages, before any insurance coverage will apply.

our insurance coverage may be insufficient, and our assets may be insufficient to cover any amounts that exceed our insurance coverage,

and we may have to pay damage awards or otherwise may enter into a settlement arrangement in connection with such claim.

A decision adverse

to our interests in the pending lawsuit, or in similar or related litigation, could result in the payment of substantial damages, or possibly

fines, and could have a material adverse effect on our business, our stock price, cash flow, results of operations and financial condition.

We have not established any reserve for any potential liability relating to the pending lawsuit or any potential future lawsuits.

such payments or settlement arrangements in current or future litigation could have a material adverse effect on our business, operating

results or financial condition.

In addition, such lawsuits may make it more difficult to finance our operations and affect our ability

to make payments for damages.

As of September 30, 2024,

the Company had cash deposited in a certain financial institution in excess of federally insured levels.

The Company regularly monitors

the financial stability of the financial institution and believes that it is not exposed to any significant credit risk in cash and cash

Bank failures, events involving limited liquidity, defaults, non-performance, or other adverse developments that affect financial

institutions, or concerns or rumors about such events, may lead to liquidity constraints.

In 2023, certain U.S.

government banking regulators

took steps to intervene in the operations of certain financial institutions due to liquidity concerns, which caused general heightened

uncertainties in financial markets.

While previous bank failures have not had a material direct impact on the Company’s operations,

if further liquidity and financial stability concerns arise with respect to banks and financial institutions, either nationally or in

specific regions, the Company’s ability to access cash or enter into new financing arrangements may be threatened, which could have

a material adverse effect on its business, financial condition and results of operations.

Risks Relating To Our Common Stock

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of future equity offerings or if we issue shares subject to options, warrants, stock awards or other arrangements.

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, including

under the Controlled Equity Offering Sales Agreement (the “Sales Agreement”), dated as of August 31, 2022, with Cantor Fitzgerald

(the “Agent”), pursuant to which the Company may issue and sell from time to time shares of common stock through

We may sell shares or other securities in any other offering at a price per share that is less than the current market price

of our securities, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders.

The sale of additional shares of common stock or other securities convertible into or exchangeable for our common stock would dilute all

of our stockholders, and if such sales of convertible securities into or exchangeable into our common stock occur at a deemed issuance

price that is lower than the current exercise price of our outstanding warrants sold to Acuitas Group Holdings, LLC (“Acuitas”)

in August 2022, the exercise price for those warrants would adjust downward to the deemed issuance price pursuant to price adjustment

protection contained within those warrants.

In addition, as of March 31, 2024, there were

warrants outstanding to purchase an aggregate of 19,320,285 shares of common stock at exercise prices ranging from $1.25 to

$12.50 per share and 4,022,758 shares issuable upon exercise of outstanding options at exercise prices ranging from $1.69 to $42.09 per

share and restricted stock units totaling 539,920.

Our Loan Agreement entered into on November 30, 2021 contains a conversion feature

whereby at the option of lender, up to $5 million of the outstanding loan amount may be converted into shares of common stock at a conversion

price of $6.98 per share.

We may grant additional options, warrants or equity awards.

To the extent such shares are issued, the interest

of holders of our common stock will be diluted.

Moreover, we are obligated to issue shares of common

stock upon achievement of certain clinical, regulatory and commercial milestones with respect to certain of our drug candidates (i.e.,

bezisterim (NE3107), NE3291, NE3413, and NE3789) pursuant to the asset purchase agreement, dated April 27, 2021, by and among the Company,

NeurMedix, Inc.

and Acuitas, as amended on May 9, 2021.

The achievement of these milestones could result in the issuance of up to 18 million

shares of our common stock, further diluting the interest of holders of our common stock.

Certain stockholders who are also officers and

directors of the Company may have significant control over our management.

As of March 31, 2024, our directors and executive

officers and affiliates currently own aggregate 23,631,735 shares of our Common Stock, which currently constitutes 38.8% of our issued

and outstanding Common Stock.

As a result, directors and executive officers and affiliates may have a significant influence on our affairs

and management, as well as on all matters requiring member approval, including electing and removing members of our Board of Directors,

causing us to engage in transactions with affiliates entities, causing or restricting our sale or merger, and certain other matters.

majority shareholder, Mr.

Terren Peizer, may be deemed to beneficially own the 23,166,210 shares of Common Stock held by Acuitas, which

constitutes 38.0% of our issued and outstanding Common Stock Such concentration of ownership and control could have the effect of delaying,

deferring or preventing a change in control of us even when such a change of control would be in the best interests of our stockholders.

We may, in the future, issue additional common

stock, which would reduce investors’ percent of ownership and may dilute our share value.

As of March 31, 2024, our Articles of Incorporation,

As of September 30, 2024, our Articles of Incorporation,

as amended, authorize the issuance of 800,000,000 shares of Common Stock, and we had 7,982,986 shares of Common Stock issued and 7,956,660

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Accordingly, we may issue up to an additional 792,043,340 shares of Common Stock.

The future issuance

of Common Stock may result in substantial dilution in the percentage of our Common Stock held by our then existing stockholders.

value any Common Stock in the future on an arbitrary basis.

The issuance of Common Stock for future services or acquisitions or other

corporate actions may have the effect of diluting the value of the shares held by our investors, might have an adverse effect on any trading

market for our Common Stock and could impair our ability to raise capital in the future through the sale of equity securities.

Unregistered sales of equity securities

Defaults Upon Senior Securities

Mine Safety Disclosures

The future issuance of Common

Stock may result in substantial dilution in the percentage of our Common Stock held by our then existing stockholders.

We may value any

Common Stock in the future on an arbitrary basis.

The issuance of Common Stock for future services or acquisitions or other corporate

actions may have the effect of diluting the value of the shares held by our investors, might have an adverse effect on any trading market

for our Common Stock and could impair our ability to raise capital in the future through the sale of equity securities.

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.

shares or other securities in offerings at a price per share that is less than the current market price of our securities, and investors

purchasing shares or other securities in the future could have rights superior to existing stockholders.

The sale of additional shares

of our Common Stock or other securities convertible into or exchangeable for our Common Stock would dilute all of our stockholders, and

if such sales of convertible securities into or exchangeable into our Common Stock occur at a deemed issuance price that is lower than

the current exercise price of our outstanding warrants sold to Acuitas Group Holdings, LLC (“Acuitas”) in August 2022, the

exercise price for those warrants would adjust downward to the deemed issuance price pursuant to price adjustment protection contained

within those warrants.

As of September 30, 2024, there were warrants outstanding

to purchase an aggregate of 4,316,002 shares of our Common Stock at exercise prices ranging from $1.53 to $125.00 per share and 517,996

shares issuable upon exercise of outstanding options at exercise prices ranging from $4.70 to $420.90 per share and restricted stock units

totaling 34,566.

In addition, pursuant to the Loan and Security Agreement and the Supplement to the Loan and Security Agreement, each

entered into on November 30, 2021, with Avenue Venture Opportunities Fund II, L.P.

and Avenue Venture Opportunities Fund, L.P., the lenders

have the option to convert up to $5 million of the outstanding loan amount into shares of our Common Stock at a conversion price of $69.80

We may also grant additional options, warrants or equity awards.

To the extent such shares are issued, the interest of holders

of our Common Stock will be diluted.

Moreover, we are obligated to issue shares of our

Common Stock upon achievement of certain clinical, regulatory and commercial milestones with respect to certain of our drug candidates

(i.e., bezisterim (NE3107), NE3291, NE3413, and NE3789) pursuant to the asset purchase agreement, dated April 27, 2021, by and among the

Company, NeurMedix and Acuitas, as amended on May 9, 2021.

The achievement of these milestones could result in the issuance of up to 1.8

million shares of our Common Stock, further diluting the interest of holders of our Common Stock.

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-Q

Item 1A. Risk Factors