What changed in this filing

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Item 1A. Risk Factors

2024-03-28 compared with 2023-03-29 · 385 added, 392 removed, 1008 unchanged (44% of the section changed)

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allocated a significant amount of time and resources into developing a treatment for COVID-19, and these efforts may ultimately be

unfruitful particularly given the increasing number of FDA approved competitor treatments with the passage of time.

regulatory approval processes of the FDA and other government authorities are lengthy, time consuming and inherently unpredictable.

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in a timely manner or at all.

of the recent terminations of our Collaboration Agreement with Merck and License Agreements with KSURF, we no longer have potential

revenue prospects or the other perceived benefits of those relationships, which may adversely affect our development and commercialization

in preclinical studies or earlier clinical trials may not be indicative of results in future clinical trials or an ability to ultimately

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are a preclinical and early stage clinical, biopharmaceutical discovery and development company.

We completed a Phase 1 clinical trial

for our Influenza A lead oral candidate CC-42344 in December 2022.

We also plan to commence a COVID-19 clinical trial in 2023 for our

lead oral candidate CDI-988.

Because of the need to complete clinical trials, establish safety and efficacy and obtain regulatory approval,

which is an expensive and time-consuming process, we do not anticipate generating revenue from product sales for at least five years

and will continue to sustain considerable losses.

We may develop a partnership that could generate income sooner, but there is no guarantee

that will be achievable.

We completed a Phase 2a clinical trial

for our Influenza A lead oral candidate CC-42344 in 2023.

We also completed a COVID-19 clinical trial in 2023 for our lead oral candidate

We expect to report findings from these studies in 2024.

Because of the need to complete clinical trials, establish safety and

efficacy and obtain regulatory approval, which is an expensive and time-consuming process, we do not anticipate generating revenue from

product sales for at least four years and will continue to sustain considerable losses.

We may develop a partnership that could generate

income sooner, but there is no guarantee that will be achievable.

had an accumulated deficit of $315,914,000 from inception through December 31, 2023 and expect to continue losing money in the future.

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pharmaceutical products.

As a result, we have lost $297,930,000 from inception through December 31, 2022, expect losses to continue,

and have never generated revenue from product sales.

As a result, we have accumulated losses of $315,914,000 from inception through December 31, 2023, expect losses

to continue, and have never generated revenue from product sales.

It is likely that we will need to raise additional capital in the future.

can be no assurance that we will ever generate income from operations or have positive cash flow from operations.

There can be no assurance that we will ever generate income from operations or have positive cash flow from operations.

we have yet to generate any revenue from product sales on which to evaluate our potential for future success and to determine if we will

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and validating new therapeutic strategies;

into collaborations with large pharmaceutical or biotechnology companies, similar to our Collaboration Agreement with Merck;

into and maintaining collaborations and relationships with large pharmaceutical or biotechnology companies;

our research and preclinical development of pharmaceutical product candidates;

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However, our ability to conduct clinical trials in a cost-effective manner and within the desired

timeframes remains subject to uncertainties arising from COVID-19 (including the pandemic’s effect on third parties on which we

rely), supply chain shortages, and potential difficulties in obtaining adequate participant enrollments.

Further, developing pharmaceutical

products, including conducting preclinical studies and clinical trials, is capital-intensive.

As a rule, research and development expenses

increase substantially as we advance our product candidates toward clinical programs.

If we are able to advance our products through

clinical trials, we may need to raise additional capital to support our operations and/or form partnerships, in addition to our existing

collaborative alliances, which may give substantial rights to a partner.

Such funding or partnerships may not be available to us on acceptable

terms, or at all.

timeframes remains subject to uncertainties, supply chain shortages, and potential difficulties in obtaining adequate participant enrollments.

Further, developing pharmaceutical products, including conducting preclinical studies and clinical trials, is capital-intensive.

rule, research and development expenses increase substantially as we advance our product candidates toward clinical programs.

able to advance our products through clinical trials, we may need to raise additional capital to support our operations and/or form partnerships,

in addition to our existing collaborative alliances, which may give substantial rights to a partner.

Such funding or partnerships may

not be available to us on acceptable terms, or at all.

Moreover, any future financing may be very dilutive to our existing stockholders.

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RELATED TO THE DISCOVERY, DEVELOPMENT AND COMMERCIALIZATION OF PRODUCT CANDIDATES

COVID-19 programs are in the preclinical stage and we face significant competition from major companies who have developed vaccines or

COVID-19 treatments.

COVID-19 programs are in the early clinical stage and we face significant competition from major companies who have developed vaccines

or COVID-19 treatments.

If we fail to gain market share because our competitors develop and successfully commercialize effective COVID-19

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virus, our business and future prospects could be materially and adversely affected.

we plan to commence a Phase 1 clinical study of our COVID-19 lead oral candidate CDI-988 in the first half of 2023, we may be unable

to produce an effective therapy in a timely manner or at all.

Additionally, we are committing substantial financial and other resources

to our COVID-19 program, which may negatively impact our other programs.

Further, in the wake of the global COVID-19 pandemic a number

of third parties, including large biotechnology and pharmaceutical companies and academic institutions have developed vaccines, at least

two of which have FDA approval.

Some competitors have also received FDA approval or emergency use authorization for the treatment of

Some of these large pharmaceutical companies, including Pfizer, Moderna and Janssen Biotech, Inc., have obtained FDA approval

for vaccines which have demonstrated high efficacy rates and are currently being distributed to the general population, with the permitted

age of use for certain vaccines as low as six months and older.

While our COVID-19 program is focused on treatment rather than prevention,

widespread vaccination limits our prospects with respect to any therapeutic product candidate we develop.

some of our competitors that are also developing treatments for the virus have substantially more resources, including government funding,

than we do and have existing products in significantly more advanced stages of development.

For example, the FDA approved remdesivir,

an investigational antiviral agent developed by Gilead for the treatment of patients with COVID-19 requiring hospitalization.

the FDA has issued an emergency use authorization for the investigational monoclonal antibody therapy for the treatment of mild-to-moderate

COVID-19 in adult and pediatric patients.

At least one other competitor is conducting a combination Phase 2/3 clinical trials for a treatment

using cannabidiol to treat COVID-19 for patients with heart issues.

Another competitor is conducting Phase 2 clinical trials for the

treatment of “long” COVID, also known as post-COVID syndrome, for patients who experience symptoms for more than four weeks.

Even if we do obtain FDA authorization for a therapeutic product, the FDA may subsequently rescind or limit such authorization as more

information about the product, including its efficacy and side effects, becomes available.

Further, this virus is highly mutative and

a number of variants have already arisen, and any treatment we are able to develop and commercialize will therefore remain subject to

the risk that a mutation will occur that produces a strain or strains of the virus to which such treatment has a diminished effect or

is ineffective.

For example, the Omicron variant of the virus is more resistant to treatments that were effective against prior variants

of the virus.

If we do develop a treatment that is effective against a current variant, a later variant may arise that reduces or eliminates

the product’s efficacy before we are able to commercialize it.

Further, if this occurs, one or more competitors’ products

may be more effective against new variants than ours, resulting in a diminished market for our products.

For example, on February 11,

2022, the FDA announced its emergency use authorization for bebtelovimab, a new monoclonal antibody for the treatment of COVID-19 by

non-hospitalized patients, that retains activity against the Omicron variant.

we completed a Phase 1 clinical study of our COVID-19 lead oral candidate CDI-988 in 2023, we may be unable to produce an effective therapy

in a timely manner or at all.

Additionally, we are committing substantial financial and other resources to our COVID-19 program, which

may negatively impact our other programs.

Further, in the wake of the global COVID-19 pandemic a number of third parties, including large

biotechnology and pharmaceutical companies and academic institutions have developed vaccines and treatments which have FDA approval or

emergency use authorization, as more particularly described above under “Business.” While the approval or authorization of

certain of these competitive offerings are limited to specified circumstances or patients, given the uncertainties in our ability to

fully develop a viable COVID-19 therapeutic product, the substantial amount of time and resources that would be necessary to complete

development and obtain regulatory approval, and the growing number of competitive offerings, we may ultimately be unable to produce a

product that is commercially viable or is able to generate material revenue.

if we do obtain FDA authorization for a therapeutic product, the FDA may subsequently rescind or limit such authorization as more information

about the product, including its efficacy and side effects, becomes available.

Further, this virus is highly mutative and a number of

variants have already arisen, and any treatment we are able to develop and commercialize will therefore remain subject to the risk that

a mutation will occur that produces a strain or strains of the virus to which such treatment has a diminished effect or is ineffective.

For example, newer variants of the virus can be more resistant to treatments that were effective against prior variants of the virus.

If we do develop a treatment that is effective against a current variant, a later variant may arise that reduces or eliminates the product’s

efficacy before we are able to commercialize it.

Further, if this occurs, one or more competitors’ products may be more effective

against new variants than ours, resulting in a diminished market for our products.

If we are unable to timely advance our COVID-19 program,

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and effective COVID-19 therapies more quickly than we do, our business and future prospects could be materially and adversely affected.

will depend on Merck for the successful research, development and commercialization of our Influenza A/B product candidates.

are party to the Collaboration Agreement, dated January 4, 2019, with Merck to research, develop, and commercialize certain proprietary

Influenza A/B antiviral agents.

On January 19, 2021, the Company announced that it had completed all research obligations under the Collaboration

Agreement with Merck, and Merck is now solely responsible for further development of the Influenza A/B antiviral compounds and will also

be solely responsible for the commercialization of any products derived therefrom.

See “Item 1 – Business – Collaborations

– Merck Collaboration” for more information on the Collaboration Agreement.

As such, the success of this collaborative alliance

will depend on the efforts and activities of Merck, particularly moving forward.

our research collaboration with Merck is terminated or is otherwise unsuccessful, including failure to reach milestones, we would not

receive milestone payments or royalties, which could materially and adversely affect our ability to successfully develop and commercialize

Influenza A/B product candidates and our future financial condition.

to the terms of the Collaboration Agreement, Merck agreed to, among other things, (i) fund the research and development collaboration,

including clinical development and commercialization;

(ii) make certain milestone payments up to a total of $156 million, including payments

associated with the successful product development and attainment of certain U.S.

and EU regulatory approvals for the developed products

and sales volume;

Merck recently terminated our Collaboration Agreement and we recently terminated our License Agreements with KSURF, we no longer have

potential revenue prospects or the other perceived benefits of those relationships, which may adversely affect our development and commercialization

efforts particularly with respect to our influenza A/B, coronavirus and norovirus programs.

late 2023 Merck notified us that it was terminating our Collaboration Agreement, effective March

Pursuant to the terms of the Collaboration Agreement, Merck had agreed to, among other things, (i) fund the research

and development collaboration, including clinical development and commercialization;

(ii) make certain milestone payments up to a total

of $156 million, including payments associated with the successful product development and attainment of certain U.S.

and EU regulatory

approvals for the developed products and sales volume;

and (iii) pay royalties on net sales of the products.

can terminate the Collaboration Agreement at any time prior to the first commercial sale of the first product developed under the Collaboration

Agreement, in its sole discretion, without cause.

Furthermore, research collaborations, including the Collaboration Agreement, may turn

out to be unsuccessful and are subject to certain risks, including the following risks:

disagreements

with Merck resulting in delays or termination of the research, development or commercialization of product candidates, or litigation;

the focus by Merck of its development and commercialization efforts;

by Merck to commit sufficient resources to the testing, marketing, distribution or development of product candidates;

by Merck of alternative products either on its own or in collaboration with others, or conflicts of interest or changes in business

strategy or other business issues, which could adversely affect its willingness or ability to fulfill their obligations to us.

our collaboration with Merck is unsuccessful for these or other reasons, or is otherwise terminated for any reason, we would not receive

the milestone payments or royalties under the Collaboration Agreement.

pursuant to the Collaboration Agreement Merck will only be obligated to make many of the milestone payments if our Influenza A/B product

receives required regulatory approvals, is commercialized and net sales exceed the thresholds set forth in the Collaboration Agreement.

Achieving milestones may be difficult and time-consuming.

If some or all of these goals are not achieved, we may not receive some or

all of the milestone payments under the Collaboration Agreement.

As of the date of this Report, none of the milestones under the Collaboration

Agreement have been reached.

of the foregoing could have a material adverse effect on our ability to successfully develop and commercialize Influenza A/B product

candidates and our future financial condition.

Because of the termination,

we will not be receiving any further payments from Merck, and will no longer have the ability to realize the other potential benefits

of this former partnership.

We may also be unable to locate a new development and commercialization partner on favorable terms or at

all, or otherwise achieve our objectives with respect to our influenza A/B program.

The loss of our alliance with Merck and its name

recognition in the industry and in general could also have adverse consequences outside of this program in terms of our ability to attract

strategic alliances to further our development and commercialization efforts generally.

in early 2024 we terminated our License Agreements with KSURF, under which we previously licensed proprietary broad-spectrum antiviral

compounds for the potential treatment of norovirus and coronavirus infections.

As a result of the terminations, which were based on our

determination that proceeding with research and development efforts under the licenses would be futile, our prospects in our coronavirus

and norovirus programs are diminished because any perceived or anticipated benefits of the licenses and collaboration will not be realized.

Following the terminations the pool of prospective compounds from which we can potentially identify, develop and commercialize viable

therapeutic product candidates under these programs is reduced.

Any of the foregoing could materially adversely affect our research and

development efforts, business and prospects.

we form strategic alliances which are unsuccessful or are terminated, we may be unable to develop or commercialize certain product candidates

and we may be unable to generate revenues from our development programs.

addition to the Collaboration Agreement with Merck, we are likely to use third-party alliance partners for financial, scientific, manufacturing,

marketing and sales resources for the clinical development and commercialization of certain of our product candidates.

These strategic

alliances will likely constrain our control over development and commercialization of our product candidates, especially once a candidate

will likely need to use third-party alliance partners for financial, scientific, manufacturing, marketing and sales resources for the

clinical development and commercialization of certain of our product candidates.

These strategic alliances, if we are able to enter into

them, will likely constrain our control over development and commercialization of our product candidates, especially once a candidate

has reached the stage of clinical development.

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or prosecute intellectual property rights possibly jeopardizing our rights in such property.

of a strategic alliance may require us to seek out and establish alternative strategic alliances with third-party partners.

not be possible, including due to restrictions under the terms of our existing collaborations, or we may not be able to do so on terms

acceptable to us.

See also the risk factor entitled “We will depend on Merck for the successful research, development and commercialization

of our Influenza A/B product candidates.” If we fail to establish alternative strategic alliances with third-party partners on

terms acceptable to us, or at all, we may be required to limit the size or scope of one or more of our programs or decrease our expenditures

and seek additional funding by other means.

Such events would likely have a material adverse effect on our results of operations and

financial condition.

of a strategic alliance such as the recent terminations of the Merck Collaboration Agreement and KSURF License Agreements may require

us to seek out and establish alternative strategic alliances with third-party partners.

This may not be possible, including due to restrictions

under the terms of our existing collaborations, or we may not be able to do so on terms acceptable to us.

See also the risk factor entitled

“Because Merck recently terminated our Collaboration Agreement and we recently terminated our License Agreements with KSURF, we

no longer have potential revenue prospects or the other perceived benefits of those relationships, which will adversely affect our development

and commercialization efforts particularly with respect to our influenza A/B, coronavirus and norovirus programs.” If we fail to

establish alternative strategic alliances with third-party partners on terms acceptable to us, or at all, we may be required to limit

the size or scope of one or more of our programs or decrease our expenditures and seek additional funding by other means.

would likely have a material adverse effect on our results of operations and financial condition.

expect to rely on third parties to conduct some or all aspects of our compound formulation, research and preclinical testing, if those

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material delays and cost increases in general throughout the pandemic caused by pandemic-related difficulties faced by our CROs and CMOs.

See the risk factor titled “Our business has been and may continue to be affected by the COVID-19 pandemic, and the full extent

of such impact remains uncertain.” Further, any disputes that may arise from our arrangements with CROs or CMOs may result in additional

unexpected expenses and force our management to allocate their limited time to seeking a resolution to the problem, which could materially

adversely affect our operations.

Further, any disputes that may arise from our arrangements with CROs or CMOs may result in additional unexpected expenses and force our

management to allocate their limited time to seeking a resolution to the problem, which could materially adversely affect our operations.

these third parties terminate their engagements, we will need to enter into alternative arrangements which would delay our product development

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our product candidates ourselves, including:

ongoing supply chain shortages;

chain shortages which were prevalent during the COVID-19 pandemic;

inability to meet any product specifications and quality requirements consistently;

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of supply may cause a delay in developing and commercializing these product candidates.

intend to establish manufacturing relationships with a limited number of suppliers to manufacture raw materials, drug substances, and

the drug product of any product candidate for which we are responsible for preclinical or clinical development.

Each supplier may require

licenses to manufacture such components if such processes are not owned by the supplier or in the public domain.

As part of any marketing

approval, a manufacturer and its processes must be qualified by the FDA or foreign regulatory authorities prior to commercialization.

of our business plan envisions establishing manufacturing relationships with a limited number of suppliers to manufacture raw materials,

drug substances, and the drug product of any product candidate for which we are responsible for preclinical or clinical development.

Each supplier may require licenses to manufacture such components if such processes are not owned by the supplier or in the public domain.

As part of any marketing approval, a manufacturer and its processes must be qualified by the FDA or foreign regulatory authorities prior

to commercialization.

If supply from the approved vendor is interrupted, there could be a significant disruption in commercial supply.

An alternative vendor

would need to be qualified through a New Drug Application (“NDA”) or marketing authorization supplement, which could cause

further delay.

The FDA or other regulatory agencies outside of the United States may also require additional studies if a new supplier

is relied upon for commercial production.

An alternative vendor would need to be qualified through a New Drug Application (“NDA”) or marketing authorization supplement,

which could cause further delay.

The FDA or other regulatory agencies outside of the United States may also require additional studies

if a new supplier is relied upon for commercial production.

factors could cause the delay of clinical trials, regulatory submissions, required approvals or commercialization of our product candidates,

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for marketing our product candidates, including approval by the FDA.

efforts to develop our product candidates are at an early stage.

To date, with two exceptions, including recently completing a Phase

1 trial for our Influenza A product candidate in late 2022, we have not entered other compounds into human clinical trials.

advance the Influenza A product to a Phase 2a trial, and to commence a Phase 1 trial for a COVID-19 product candidate, in 2023.

be unable to progress our product candidates undergoing preclinical testing into clinical trials.

Success in preclinical testing and

early clinical trials does not ensure that later clinical trials will succeed, and favorable initial results from a clinical trial do

not determine outcomes in subsequent clinical trials.

The indications of use for which we are pursuing development may have clinical

effectiveness endpoints not previously reviewed or validated by the FDA or foreign regulatory authorities, which may complicate or delay

our effort to obtain marketing approval.

efforts to develop our product candidates are limited to a small number of product candidates aimed at treating a small number of viral

To date, we have only entered a limited number of compounds into human clinical trials, including in 2023 when we advanced

our Influenza A product candidate to a Phase 2a trial and our COVID-19 product candidate where we initiated a Phase 1 trial.

unable to progress our product candidates undergoing preclinical testing into clinical trials.

Success in preclinical testing and early

clinical trials does not ensure that later clinical trials will succeed, and favorable initial results from a clinical trial do not determine

outcomes in subsequent clinical trials.

The indications of use for which we are pursuing development may have clinical effectiveness

endpoints not previously reviewed or validated by the FDA or foreign regulatory authorities, which may complicate or delay our effort

to obtain marketing approval.

We cannot guarantee that our clinical trials will succeed.

In fact, most compounds fail in clinical

trials, even at companies far larger and more experienced than us.

In fact, most compounds fail in clinical trials,

even at companies far larger and more experienced than us.

If any preclinical or clinical trials yield adverse results, it could delay

the development of the product candidate, force us to cease pursuing the product candidate, or render it impossible or impracticable

to proceed towards commercialization.

have not obtained marketing approval or commercialized any of our product candidates.

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reports summarizing clinical trial data.

Following the completion of this pilot program in March 2020, the FDA may consider making release

of clinical study reports mandatory and may consider making additional information publicly available on a routine basis in response

to concerns expressed by the academic community emphasized by the COVID-19 pandemic, including information we may consider to be trade

secrets or other proprietary information.

If the FDA takes these measures, we may be forced to disclose propriety information about our

product candidates and research, which could materially harm our business.

Based on these trends, the FDA may consider making release of clinical study reports mandatory

and may consider making additional information publicly available on a routine basis in response to concerns expressed by the academic

community emphasized by the COVID-19 pandemic, including information we may consider to be trade secrets or other proprietary information.

If the FDA takes these measures, we may be forced to disclose propriety information about our product candidates and research, which

could materially harm our business.

laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the United States.

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This resulted from ongoing discussions among WTO member countries which began in 2020 with a proposal for a more extensive waiver

that would have covered patents for COVID-19 related diagnostics and therapeutics as well as vaccines, and the WTO is still under discussions

to potentially extend the waiver to such products.

Similarly, some have argued that the WTO should also extend the waiver to apply to

other types of intellectual property such as know-how related to the development and distribution of the COVID-19 related products.

as of March 15, 2023 no definitive action has been taken on expanding upon the WTO waiver that is currently in effect.

The WTO waiver,

together with similar actions that may be taken with respect to COVID-19-related products or other products in which we are or may become

involved could materially diminish or eliminate our ability to protect the underlying intellectual property rights we rely on for such

products, including those licensed from third parties, and as a result any potential competitive advantage would be lost.

If we are unable

to prevent material disclosure of the non-patented intellectual property related to our technologies to third parties, and there is no

guarantee we will have any such enforceable trade secret protection, we may not be able to establish or maintain a competitive advantage

in our market, which could materially adversely affect our business, results of operations and financial condition.

that would have covered patents for COVID-19 related diagnostics and therapeutics as well as vaccines.

The WTO waiver, together with

similar actions that may be taken with respect to COVID-19-related products or other products in which we are or may become involved

could materially diminish or eliminate our ability to protect the underlying intellectual property rights we rely on for such products,

including those licensed from third parties, and as a result any potential competitive advantage would be lost.

If we are unable to prevent

material disclosure of the non-patented intellectual property related to our technologies to third parties, and there is no guarantee

we will have any such enforceable trade secret protection, we may not be able to establish or maintain a competitive advantage in our

market, which could materially adversely affect our business, results of operations and financial condition.

third-party intellectual property infringement claims are asserted against us, it may prevent or delay our development and commercialization

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have a material adverse effect on the price of our common stock.

depend on intellectual property licensed from third parties in one of our COVID-19 programs and termination of any of these licenses

could have a material adverse effect on our business.

one of our COVID-19 programs, we leverage the rights to preclinical leads from our two License Agreements with KSURF.

1 – Business – Research and Development Update – Coronavirus infections” for more information on these License

depend on the patents, know-how and other intellectual property for the development and, if approved, commercialization of our COVID-19

If these licenses are terminated, or found to be unenforceable, it could result in the loss of significant rights and could

harm our ability to commercialize our future product candidates in the coronavirus program.

License Agreements impose certain obligations on us, including obligations to use diligent efforts to meet development thresholds and

payment obligations.

Failure by us to comply with such obligations may result in termination of the respective License Agreement.

KSURF terminates these License Agreements, we may not be able to proceed with that particular coronavirus program or discover, develop

or commercialize any other product candidates covered by these agreements.

the License Agreements are complex, and contain certain provisions which may be susceptible to multiple interpretations.

disputes may arise between us and our licensors regarding intellectual property subject to a license agreement, including those relating

scope of rights, if any, granted under the license agreement and other interpretation-related issues;

and to what extent our technology and processes infringe on intellectual property of the licensor that is not subject to the license

our licensor or its licensor had the right to grant the license agreement;

third parties are entitled to compensation or equitable relief, such as an injunction, for our use of the intellectual property without

their authorization;

right to sublicense patent and other rights to third parties under collaborative development relationships;

we are complying with our obligations with respect to the use of the licensed technology in relation to our development and commercialization

of product candidates;

involvement in the prosecution and enforcement of the licensed patents and our licensors’ overall patent prosecution and enforcement

allocation of ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors

and by us and any future partners or collaborators;

amounts of royalties, milestones or other payments due under the license agreement.

resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the

relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant

may need to obtain additional licenses to intellectual property rights from third parties.

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biotechnology and pharmaceutical industries are intensely competitive.

We have competitors both in the United States and internationally,

including major multinational pharmaceutical companies, biotechnology companies and universities and other research institutions.

competitors have substantially greater financial, technical and other resources, such as larger research and development staff and experienced

marketing and manufacturing organizations.

This enables them, among other things, to make greater research and development investments

and efficiently utilize their research and development costs.

Additional mergers and acquisitions in the biotechnology and pharmaceutical

industries may cause even more resources being concentrated in our competitors.

Additionally, smaller or early-stage companies of which

we may not be aware could also prove to be material competitors, particularly through collaborative arrangements with larger, more well-established

companies or by competing with us for limited resources and strategic alliances with our current or prospective partners.

may increase further because of advances in the commercial applicability of technologies and greater availability of capital for investment

in these industries.

Our competitors may develop, acquire or license drug products that are more effective or less costly than any product

candidate we may develop.

See “Business-Competition” at page 10 for a description

of the competitive environment we face.

We have competitors both in the United States and internationally, including major multinational

pharmaceutical companies, biotechnology companies and universities and other research institutions.

Our competitors have substantially

greater financial, technical and other resources, such as larger research and development staff and experienced marketing and manufacturing

organizations.

This enables them, among other things, to make greater research and development investments and efficiently utilize their

research and development costs.

Additional mergers and acquisitions in the biotechnology and pharmaceutical industries may cause even

more resources being concentrated in our competitors.

Additionally, smaller or early-stage companies of which we may not be aware could

also prove to be material competitors, particularly through collaborative arrangements with larger, more well-established companies or

by competing with us for limited resources and strategic alliances with our current or prospective partners.

Competition may increase

further because of advances in the commercial applicability of technologies and greater availability of capital for investment in these

Our competitors may develop, acquire or license drug products that are more effective or less costly than any product candidate

we may develop.

programs we are focusing on are in a preclinical d or early clinical development stage and are targeted toward indications for which

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and commercialize.

For example, the widespread distribution of COVID-19 vaccines will reduce the demand for any therapeutic product we

develop to treat symptoms caused by the virus.

We will not achieve our business plan if the acceptance of our products is inhibited by

price competition or the reluctance of physicians to switch from existing drug products to our products, or if physicians switch to other

new drug products or reserve our products for use in limited circumstances.

Additionally, the biopharmaceutical industry is characterized

by rapid technological and scientific change, and we may not be able to adapt to these rapid changes to the extent necessary to keep

up with competitors or at all.

The inability to compete with existing or subsequently introduced drug products would have a material

adverse impact on our business, financial condition and prospects.

For example, the widespread distribution of COVID-19 treatments and vaccines will reduce the demand for any therapeutic

product we develop to treat symptoms caused by the virus, particularly as new competing products are developed and approved by the FDA

and other regulators.

We will not achieve our business plan if the acceptance of our products is inhibited by price competition or the

reluctance of physicians to switch from existing drug products to our products, or if physicians switch to other new drug products or

reserve our products for use in limited circumstances.

Additionally, the biopharmaceutical industry is characterized by rapid technological

and scientific change, and we may not be able to adapt to these rapid changes to the extent necessary to keep up with competitors or

The inability to compete with existing or subsequently introduced drug products would have a material adverse impact on our business,

financial condition and prospects.

pharmaceutical companies may invest heavily to accelerate discovery and development of novel compounds or to in-license novel compounds

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candidates before we do, which would have a material adverse impact on our business.

business could be negatively impacted by cybersecurity threats and other security threats and disruptions.

our business relies on proprietary technology and computer systems, we face certain security threats, including threats to our information

technology infrastructure, attempts to gain access to our proprietary or confidential information, threats to physical security, and

domestic terrorism events.

Our information technology networks and related systems are critical to the operation of our business and

our research and development efforts.

We are also involved with information technology systems for certain third parties, which generally

face similar security threats.

Cybersecurity threats in particular, are persistent, evolve quickly and include, but are not limited to,

computer viruses, attempts to access information, denial of service and other electronic security breaches believe that we have implemented

appropriate measures and controls and invested in skilled information technology resources to appropriately identify threats and mitigate

potential risks, but there can be no assurance that such actions will be sufficient to prevent disruptions to critical systems, the unauthorized

release of confidential information or corruption of data.

A security breach or other significant disruption involving these types of

information and information technology networks and related systems could:

the proper functioning of these networks and systems and therefore its operations and/or

those of third parties on which we rely;

in the unauthorized access to, and destruction, loss, theft, misappropriation or release

of, our proprietary, confidential, sensitive or otherwise valuable information, or that of

third parties with which we collaborate or otherwise depend, which others could use to compete

against us or for disruptive, destructive or otherwise harmful purposes and outcomes;

or compromise preclinical or clinical studies or the analysis and use of data collected in

our efforts to develop product candidates;

significant attention and resources of management and key personnel to remedy any damages

or other adverse consequences that result;

us to claims for breach of contract, damages, credits, penalties or termination with respect

to our relationships with third parties, or regulatory actions by governmental agencies;

our reputation with industry participants, existing or prospective strategic alliances, and

the public generally.

or all of the foregoing could have a material negative impact on its business, financial condition and prospects.

of our information technology infrastructure to operate effectively could adversely affect our business.

depend on information technology infrastructure to pursue our business objectives and development efforts with respect to our product

If a problem occurs that impairs this infrastructure, including as a result of an outage or malfunctioning of the hardware

and software comprising or contributing to the information technology, the resulting disruption could impede our ability to proceed with

research objectives in a timely manner, or otherwise carry on business in the normal course.

Any such events could cause us to lose opportunities

or progress with respect to product candidates or strategic alliances, and could require us to incur significant expense to remediate.

intelligence presents risks and challenges that can negatively impact our business.

intelligence-based platforms and tools are increasingly being used in the biopharmaceutical, pharmaceutical, and consumer health industries.

As with many technological innovations, artificial intelligence presents risks and challenges that could impact our business.

current use of artificial intelligence-based platforms or tools in our business is relatively minimal, many of our competitors have begun

utilizing artificial intelligence tools to aid in the development of pharmaceutical products.

Our decision to not implement artificial

intelligence platforms or tools may put us at a competitive disadvantage in comparison to competitors who currently use artificial intelligence

platforms and tools in the development of pharmaceutical products.

artificial intelligence expands, our competitors, which may have significantly greater financial and human capital resources, may use

artificial intelligence to further their research efforts and advance competitive product candidates through clinical trials.

the future, we may adopt and integrate artificial intelligence platforms and/or tools into our business.

Further, any third-party collaborators

may incorporate artificial intelligence platforms and tools into their business without disclosing this to us, and the providers of these

artificial intelligence platforms and tools may not meet existing or rapidly evolving regulatory or industry standards with respect to

privacy and data protection.

If our third-party collaborators who use artificial intelligence platforms or tools experience an actual

or perceived breach related incident because of the use of artificial intelligence, we may lose valuable intellectual property, confidential

information, and suffer reputational damage.

Further, bad actors around the world use increasingly sophisticated methods, including the

use of artificial intelligence, to engage in illegal activities involving the theft and misuse of personal information, confidential

information, and intellectual property.

Any of these outcomes could damage our reputation, result in the loss of valuable property and

information, and adversely impact our business.

commercial success of our product candidates will depend upon the acceptance of these product candidates by the medical community, including

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or is available at limited levels, we may not be able to successfully commercialize product candidates we develop.

to the recent change in the United States presidency, we expect increased regulation as well as uncertainty, which may adversely affect

our business.

President Biden, we expect that the FDA, the Centers for Disease Control and other agencies which affect our business may increase their

regulatory efforts.

At the senior administrative level, new regulators with a regulatory zeal may tighten existing regulations and that

approach may also be taken in the routine interactions between staff and our scientists and others.

For example, since taking office

in 2021, the Biden Administration has forwarded proposed rules and budget allocations intended to expand the FDA’s purview and

regulatory capabilities.

These rules or other regulatory developments which may occur in the future could have an adverse impact, directly

or indirectly, on our operations or on the operations of our collaborators.

Increased regulation and enforcement may lead to increased

costs and further delays in getting approvals, which may adversely affect our business.

to the change in the United States presidency and upcoming election, we and our industry face uncertainty including the potential for

increased regulation, which may adversely affect our business.

Biden has expressed a desire to make healthcare more affordable, including adopting new laws and working with federal agencies in a manner

which may adversely affect our business through an increase in regulatory efforts.

At the senior administrative level, new regulators

with a regulatory zeal may tighten existing regulations and that approach may also be taken in the routine interactions between staff

and our scientists and others.

For example, in December 2023, the Biden Administration announced its intention to lower prescription

drug costs and address certain features of the current healthcare sector, such as the focus on insurance and consolidation.

or other regulatory developments which may occur in the future could have an adverse impact, directly or indirectly, on our operations

or on the operations of our collaborators.

These trends and potential future government action, particularly at the federal level, are

highly uncertain and we expect will be dependent to some extent on the outcome of the next presidential election later this year.

President Biden is elected for another four-year term, he could take further action on the issues his administration has previously addressed.

Contrarily, if former President Trump (or another Republican candidate) were elected, there will be a de-emphasis on regulation.

regulation and enforcement may lead to increased costs and further delays in getting approvals, which may adversely affect our business.

pressures on our drug candidates, including as the result of proposed legislative changes, may negatively impact our future results of

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prescription prices by permitting Medicare to negotiate prices;

price increases;

price increases and pricing control by private sector industry participants;

prices for drugs which do not have competition;

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Additionally,

in 2022 the Biden administration proposed legislation to implement a number of regulatory changes to make affordable healthcare available

for a larger number of Americans, including by lowering the costs of prescription drugs.

The proposal includes measures that would allow

the government to negotiate prices of certain prescription drugs under Medicare and would redesign the Medicare Part D benefit to limit

patient out-of-pocket drug costs and shift liabilities among stakeholders, including manufacturers.

Following the proposal, the Inflation Reduction Act was enacted later in

2022 which provides for lower cost prescription drugs and vaccines in Medicare and other federal programs, including by establishing a

$2,000 annual cap on out-of-pocket drug costs for Medicare participants beginning in 2025.

In a similar vein, in October 2022, President

Biden issued an executive order to address concerns about the high costs of prescription drugs in the U.S., wherein the Secretary of the

Department of Health and Human Services (“HHS”) was tasked with evaluating potential new health care payment and delivery

models designed to lower drug costs and promote access to innovative drug therapies for beneficiaries enrolled in the Medicare and Medicaid

programs, including models that may lead to lower cost-sharing for commonly used drugs and support value-based payment that promotes high-quality

In its responsive report, the HHS indicated that it was “full steam ahead in delivering cost savings” and identified

three potential price-reducing models for further consideration, as well as other areas for further research.

Like the Inflation Reduction

Act, certain of the recent or newly proposed regulatory changes will be subject to Congressional approval, and we cannot predict what,

if any, of these broad proposals or other legislation or regulation will pass or otherwise be implemented, particularly with a divided

beginning in 2022 the Biden administration proposed legislation and policy changes to implement a number of regulatory changes to make

affordable healthcare available for a larger number of Americans, including by lowering the costs of prescription drugs.

A 2022 legislative

proposal included measures that would allow the government to negotiate prices of certain prescription drugs under Medicare and would

redesign the Medicare Part D benefit to limit patient out-of-pocket drug costs and shift liabilities among stakeholders, including manufacturers.

Following the proposal, the Inflation Reduction Act was enacted later in 2022 which provides for lower cost prescription drugs and vaccines

in Medicare and other federal programs, including by establishing a $2,000 annual cap on out-of-pocket drug costs for Medicare participants

beginning in 2025.

In a similar vein, in October 2022, President Biden issued an executive order to address concerns about the high costs

of prescription drugs in the U.S., wherein the Secretary of the Department of Health and Human Services (“HHS”) was tasked

with evaluating potential new health care payment and delivery models designed to lower drug costs and promote access to innovative drug

therapies for beneficiaries enrolled in the Medicare and Medicaid programs, including models that may lead to lower cost-sharing for

commonly used drugs and support value-based payment that promotes high-quality care.

In its responsive report, the HHS indicated that

it was “full steam ahead in delivering cost savings” and identified three potential price-reducing models for further consideration,

as well as other areas for further research.

A similar initiative covering a broader scope of activities and intended actions (including

addressing drug prices and industry consolidation and control) was again released by the White House in December 2023.

Like the Inflation

Reduction Act, certain of the recent or newly proposed regulatory changes will be subject to Congressional approval, and we cannot predict

what, if any, of these broad proposals or other legislation or regulation will pass or otherwise be implemented, particularly with a

divided Congress.

the state level, individual states are increasingly aggressive in passing legislation and implementing regulations designed to control

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of March 28, 2024, we have 12 full-time employees.

As our Company matures, we expect to expand our employee base to increase our

managerial, scientific and operational, commercial, financial and other resources and to hire more consultants and contractors.

growth would impose significant additional responsibilities on our management, including the need to identify, recruit, maintain, motivate

and integrate additional employees, consultants and contractors.

Also, our management may need to divert a disproportionate amount of

its attention away from our day-to-day activities and to manage these growth activities.

We may not be able to effectively manage the

expansion of our operations, which may cause weaknesses in our infrastructure, and give rise to operational mistakes, loss of business

opportunities, loss of employees and reduced productivity among remaining employees.

Our expected growth could require significant capital

expenditures and may divert financial resources from other projects, such as developing additional product candidates.

If our management

cannot effectively manage our growth, our expenses may increase more than expected, our ability to generate and/or grow revenues could

be reduced, and we may not be able to implement our business strategy.

Our future financial performance and our ability to commercialize

product candidates and compete effectively will depend, in part, on our ability to manage our future growth.

As our Company matures, we expect to expand our employee base to increase our managerial,

scientific and operational, commercial, financial and other resources and to hire more consultants and contractors.

Future growth would

impose significant additional responsibilities on our management, including the need to identify, recruit, maintain, motivate and integrate

additional employees, consultants and contractors.

Also, our management may need to divert a disproportionate amount of its attention

away from our day-to-day activities and to manage these growth activities.

We may not be able to effectively manage the expansion of

our operations, which may cause weaknesses in our infrastructure, and give rise to operational mistakes, loss of business opportunities,

loss of employees and reduced productivity among remaining employees.

Our expected growth could require significant capital expenditures

and may divert financial resources from other projects, such as developing additional product candidates.

If our management cannot effectively

manage our growth, our expenses may increase more than expected, our ability to generate and/or grow revenues could be reduced, and we

may not be able to implement our business strategy.

Our future financial performance and our ability to commercialize product candidates

and compete effectively will depend, in part, on our ability to manage our future growth.

relationships with customers and third-party payors may be subject, directly or indirectly, to federal and state healthcare fraud and

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office in Miami, Florida and an administrative office in Australia.

In addition, our Influenza A Phase 1 clinical trial depends on one

or more CROs and their facilities located in Australia for Phase 1 and the United Kingdom for Phase 2a for the furtherance of our research

and development efforts as to that product.

We also plan use Australian CROs for our planned COVID-19 clinical trial in 2023.

third parties on which we rely are vulnerable to natural disasters such as earthquakes, tornados, severe storms, hurricanes, tsunamis,

and fires, as well as other events that could disrupt our operations and cause delays in research and development of our product candidates.

We do not carry insurance for natural disasters or similar events, and we may not carry sufficient business interruption insurance to

compensate us for losses that may occur.

Any losses or damages we incur could have a material adverse effect on our operations.

In addition, our Influenza A Phase 1 program has been dependent on

one or more CROs and their facilities located in Australia for Phase 1 and will depend on one or more CROs in the United Kingdom for

Phase 2a for the furtherance of our research and development efforts as to that product.

We also rely on Australian CROs for our coronaviruses

and norovirus programs.

We and third parties on which we rely are vulnerable to natural disasters such as earthquakes, tornados, severe

storms, hurricanes, tsunamis, and fires, as well as other events that could disrupt our operations and cause delays in research and development

of our product candidates.

We do not carry insurance for natural disasters or similar events, and we may not carry sufficient business

interruption insurance to compensate us for losses that may occur.

Any losses or damages we incur could have a material adverse effect

on our operations.

our information technology systems are compromised, the information we store and process, including our intellectual property, could

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of operations.

are increasingly suffering damage from attacks by hackers and there is a general risk that the Russia may adopt widespread Internet hacking

as a weapon in the Ukrainian war, which hacking may ultimately affect us.

In the ordinary course of business, we store sensitive information,

such as our intellectual property, including trade secrets and results of our clinical and preclinical research, and that of our suppliers

and business partners, on a central server, and such information is transmitted via email correspondence.

The secure maintenance and

processing of this information is critical to our research and development activities and future operations.

Despite our security measures,

our information technology and infrastructure may be vulnerable to attacks by hackers or breaches due to employee error, malfeasance

or other disruptions.

Any such breach could compromise our information technology systems and the information stored there could be accessed

by third parties, publicly disclosed, lost or stolen.

Any such unauthorized access, disclosure, misappropriation or other loss of information

could result in disruption of our operations, including our existing and future research collaborations, and damage our reputation, which

in its turn could harm our business and future results of operations.

are increasingly suffering damage from attacks by hackers and there is a general risk that adversaries in geopolitical conflicts such

as those taking place in Ukraine and in the Middle East adopt widespread Internet hacking as a weapon, which hacking may ultimately affect

In the ordinary course of business, we store sensitive information, such as our intellectual property, including trade secrets and

results of our clinical and preclinical research, and that of our suppliers and business partners, on a central server, and such information

is transmitted via email correspondence.

The secure maintenance and processing of this information is critical to our research and development

activities and future operations.

Despite our security measures, our information technology and infrastructure may be vulnerable to attacks

by hackers or breaches due to employee error, malfeasance or other disruptions.

Any such breach could compromise our information technology

systems and the information stored there could be accessed by third parties, publicly disclosed, lost or stolen.

Any such unauthorized

access, disclosure, misappropriation or other loss of information could result in disruption of our operations, including our existing

and future research collaborations, and damage our reputation, which in its turn could harm our business and future results of operations.

we fail to comply with applicable laws and regulations, including environmental, health and safety laws and regulations, we could become

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Another requirement for being listed on Nasdaq is that the Company have a minimum of 300 round lot holders.

While the bid price of our common stock was $1.91 on March 10, 2023.

While the bid price of our common stock was $[XX] on March [XX], 2024.

If we again fail to comply with Nasdaq’s minimum bid price,

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2022, and declined further following the reverse split taking effect to below $2.00 on certain dates in December 2022 and February 2023.

More recently, our common stock fell from as high as $3.14 in August 2023 to $1.46 in November 2023, and it has hovered around that range

Our common stock may continue to be volatile and could materially fall for a number of reasons including:

Announcements

by the FDA of final approval of vaccines and treatments for COVID-19;

by the FDA of final approval of vaccines and treatments for COVID-19 and other diseases we target;

Announcements

relating to the spread of new variants of COVID-19;

relating to the spread of new variants of COVID-19 and other diseases we target;

Announcements

by competitors that they are initiating human trials of drugs to treat COVID-19;

which demonstrate that the rapid spread of COVID-19 has receded;

by competitors that they are initiating human trials of drugs to treat the diseases we target;

which demonstrate that the spread or intensity of COVID-19 or other diseases has receded;

disclosure that the use of our technology and the patents we licensed do not appear promising for the treatment of this virus;

results of our planned COVID-19 trial and other clinical trials;

results of our clinical trials;

announcement concerning the initiation of or delay in our planned clinical trials;

announcements concerning our Influenza A/B product candidate;

termination of any other factors which may have created the unusual volatility and spike in volume.

the current price and volume level is reduced, investors may sustain large losses.

Announcements

of entering into or terminating strategic alliances such as the termination of the Merck Collaboration Agreement which we disclosed

in December 2023 and the terminations of the KSURF License Agreements which we disclosed in March 2024;

occurrence of any other events or factors which may have created the unusual volatility and spike in volume.

the current price is reduced, investors may sustain large losses.

to factors beyond our control, our common stock price may be volatile, or may decline regardless of our operating performance, and you

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and volume fluctuations in the overall stock market from time-to-time;

to external factors such as geopolitical turmoil, inflation or other events, including the Russian invasion of Ukraine or other

to external factors such as geopolitical turmoil, inflation or other events, including the conflicts in Ukraine and Israel or other

unknown hostilities, investors may sell our common stock to meet margin calls on other stocks or as the result of economic disruptions;

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result in substantial costs and a diversion of our management’s attention and resources.

we are unable to rely on certain exemptions from registration under the federal securities laws, as the result of a “disqualifying

event” involving a director of the Company, it could adversely affect our ability to obtain future private financing.

January 10, 2019, Dr.

Phillip Frost, one of our directors, was permanently enjoined from violating a certain anti-fraud provision of

the Securities Act of 1933 (the “Securities Act”), future violations of Section 13(d) of the Exchange Act and Rule 13d-1(a)

thereunder and participating in penny stock offerings with certain exceptions.

So long as Dr.

Frost is a director or until January 11,

2024, the Company will be unable to rely on certain exemptions from registration including the exemptions under Rule 506 and Regulation

A promulgated under the Securities Act absent a waiver issued by the Securities and Exchange Commission (the “SEC”).

not applied for a waiver, and even if we do, the SEC may choose not to grant us a waiver.

While there is a statutory exemption for private

placements under Section 4(a)(2) of the Securities Act, case law creates uncertainty on establishing an exemption outside of the Rule

506 safe harbor.

The absence of the Rule 506 safe harbor could adversely affect our ability to raise necessary capital in private placements.

It has not and will not affect our ability to raise capital in registered public offerings.

of the Russian invasion of Ukraine and other major events, the effect on the capital markets and the economy is uncertain, and we may have to deal with a

recessionary economy and economic uncertainty including possible material adverse effects upon our business.

Beginning with the Russian invasion of Ukraine, certain events began to

affect the global and United States economy including increased inflation, increases in the prices of commodities such as oil and gas,

large Western companies ceasing to do business in Russia and uncertain capital markets with declines in leading market indexes.

of this war and its impact are at best uncertain and continuation may result in Internet access issues if Russia, for example, began illicit

cyber activities.

More recently, in March 2023 two major U.S.

banks collapsed, while certain other banks began facing extreme financial

difficulty and seeking immediate sources of liquidity to remain open.

These developments were widely considered a product of the rising

interest rates that began in 2022 as the Federal Reserve in U.S.

of geopolitical conflicts, central bank actions to combat inflation and other major events, the effect on the capital markets and the

economy is uncertain, and we may have to deal with a recessionary economy and economic uncertainty including possible material adverse

effects upon our business.

with the Russian invasion of Ukraine, certain events began to affect the global and United States economy including increased inflation,

increases in the prices of commodities such as oil and gas, large Western companies ceasing to do business in Russia and uncertain capital

markets with declines in leading market indexes.

In 2023 another conflict arose in Israel which has also added to the uncertainty.

duration of these events and their impact are at best uncertain and continuation may result in negative consequence on the U.S.

Further, in March 2023 two major U.S.

banks collapsed, while certain other banks faced extreme financial difficulty and had

to seek immediate sources of liquidity to remain open.

These developments were widely considered a product of the increase in interest

rates that began in 2022 as the Federal Reserve in U.S.

and central banks in other jurisdictions have sought to combat inflation.

inflation has since declined, uncertainty remains as to the timing of the Federal Reserve reducing interest rates, and if

inflation does not fall low enough and/or the Federal Reserve declines to reduce interest rates in the near term, the result could be

tipping the U.S.

economy into a recession.

In the wake of these events, the U.S.

and global capital markets have demonstrated substantial volatility, as many investors consider

economic outlooks to be uncertain at best.

Ultimately the economy may turn into a recession with uncertain and potentially severe impacts

upon public the capital markets and us.

We cannot predict how this will affect our business, but the impact may be material and adverse.

certain of our stockholders control a significant number of shares of our common stock, they may have effective control over our actions

requiring stockholder approval.

of March 21, 2023, our directors, executive officers and our former Board Chairman, and their respective affiliates, beneficially own

approximately 12.6% of our outstanding shares of common stock.

As a result, these stockholders, acting together, would have the ability

to influence or control the outcome of matters submitted to our stockholders for approval, including the election of directors and any

merger, consolidation or sale of all or substantially all of our assets.

Raymond Schinazi, our former Board Chairman, owns approximately

7.9% of our common stock.

Schinazi and Dr.

Philip Frost, a director, and certain other stockholders entered into a Stockholder Rights Agreement in November 2014.

This Agreement gives each of Dr.

Schinazi (together with certain other stockholders) and Dr.

Frost (together with certain other stockholders)

the right to designate three directors to a seven-person board of directors and together agree upon the seventh designee.

our principal stockholders, acting together, would have the ability to control the management and affairs of our company.

this concentration of ownership might harm the market price of our common stock by:

deferring or preventing a change in corporate control;

a merger, consolidation, takeover or other business combination involving us;

a potential acquirer from making a tender offer or otherwise attempting to obtain control of us.

and global capital markets have demonstrated volatility,

as many investors consider economic outlooks to be uncertain .

While the capital markets have since recovered, ultimately the economy

may turn into a recession with uncertain and potentially severe impacts upon public the capital markets and us.

We cannot predict how

this will affect our business, but the impact may be material and adverse.

issuances of our common stock or rights to purchase our common stock could cause additional dilution of the percentage ownership of our

stockholders and could cause our stock price to fall.

the year ended December 31, 2022 we did not conduct public or private offerings of securities.

We expect that our current cash position

will be sufficient to fund our operations over the next 12 months subject to the many uncertainties and risks that may rise such as those

described herein, significant additional capital may be needed in the future to continue our planned operations.

To the extent we have

raised and continue to raise additional capital by issuing equity securities, our stockholders may experience substantial dilution.

may sell common stock, convertible securities or other equity securities in one or more transactions at prices and in a manner we determine

from time to time.

If we sell common stock, convertible securities or other equity securities in more than one transaction, investors

may be materially diluted by subsequent sales.

These sales may also result in material dilution to our existing stockholders, and new

investors could gain rights superior to our existing stockholders.

the year ended December 31, 2023 we conducted a private sale of a total of 2,030,458 shares of our common stock for gross proceeds of

$4,000,000, and did not conduct any public offerings.

We expect that our current cash position will be sufficient to fund our operations

over the next 12 months subject to the many uncertainties and risks that may rise such as those described herein, significant additional

capital may be needed in the future to continue our planned operations.

To the extent we have raised and continue to raise additional

capital by issuing equity securities, our stockholders may experience substantial dilution.

We may sell common stock, convertible securities

or other equity securities in one or more transactions at prices and in a manner, we determine from time to time.

If we sell common stock,

convertible securities or other equity securities in more than one transaction, investors may be materially diluted by subsequent sales.

These sales may also result in material dilution to our existing stockholders, and new investors could gain rights superior to our existing

stockholders.

sales of large amounts of our common stock in the public market or a perception that such sales might occur could cause a decrease in

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Additionally,

as of December 31, 2022, we had approximately 350,000 options and 13,000

warrants outstanding that, if fully exercised, would result in the issuance of 363,000 shares of common stock and approximately 484,000

shares of common stock remain available for future grants under the Cocrystal Pharma, Inc.

as of December 31, 2023, we had approximately 558,000 options and 11,000 warrants outstanding that, if fully exercised, would result

in the issuance of 569,000 shares of common stock and approximately 275,000 shares of common stock remain available for future grants

under the Cocrystal Pharma, Inc.

2015 Equity Incentive Plan.

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or disclosure by us which may result, would expose us to numerous risks, including risks to our reputation and stock price.

Institutional

and individual investors are increasingly using ESG screening criteria to determine whether certain equity securities such as our common

stock should be included in their investment portfolios, although certain states are resisting using ESG criteria.

In recent years, a

growing number of investors, regulators, self-regulatory organizations and other stakeholders have expressed an interest in setting often-ambitious

ESG goals and to require the provision of new and more robust disclosure and implementation of such goals, including progress toward

the goals and other matters of interest to ESG stakeholders.

In response, we may voluntarily elect or be required to adopt strategies,

policies, or procedures related to ESG matters, in response to new rules or regulations, external pressures or otherwise.

we may undertake to accomplish and accurately report on ESG goals and objectives could present numerous material operational, reputational,

financial, legal and other risks, any of which could have a material negative impact, including on our reputation and stock price.

example, any ESG objectives or policies we implement, be it in response to new laws, regulations or rules (including any that may in

the future be implemented by the SEC or Nasdaq), actions taken by self-regulatory organizations, investors or other stakeholders, or

otherwise, could cause us to expend significant capital and human resources and/or divert management’s attention from central operational

Further, any failure by us to accurately disclose and effectively carry out ESG undertakings, which may include forward-looking

proposals based on assumptions and subject to factors beyond our control, could expose us to reputational harm, government enforcement

or private litigation, and stock price and volume volatility.

recent years, institutional and individual investors focused on ESG screening criteria to determine whether certain equity securities

such as our common stock should be included in their investment portfolios, although certain states are resisting using ESG criteria.

A growing number of investors, regulators, self-regulatory organizations and other stakeholders have expressed an interest in setting

often-ambitious ESG goals and to require the provision of new and more robust disclosure and implementation of such goals, including

progress toward the goals and other matters of interest to ESG stakeholders.

However, in January 2024, two large financial firms, JP

Morgan Asset Management and State Street Global Advisors, retreated from the Climate Action 100+ investor compact, which launched in

2017 as a collaborative investor group working to influence large corporate emitters of greenhouse gasses to commit to net zero targets

and introduce climate-related governance and disclosure processes.

Further, it is reported investors pulled a total of $13 billion out

of ESG-focused investment funds during the 2023 fiscal year.

In December 2023, House Republicans subpoenaed BlackRock and State Street

Global Advisors, requesting documents and communications relating to their respective advancement of ESG policies in connection with

an ongoing investigation into current antitrust laws.

the large financial firms’ exit from ESG initiatives may spark a larger trend of stepping away from ESG-related investment decisions,

it is uncertain how the market at large will respond.

If we decide to report any of the Company’s ESG-related efforts, goals, or

objectives, we could be presented with numerous material operational, reputational, financial, legal and other risks, any or all of which

could have a material negative impact, including on our reputation and stock price.

For example, any ESG objectives or policies we implement,

be it in response to new laws, regulations or rules (including any that may in the future be implemented by the SEC or Nasdaq), actions

taken by self-regulatory organizations, investors or other stakeholders, or otherwise, could cause us to expend significant capital and

human resources and/or divert management’s attention from central operational matters.

Further, any failure by us to accurately

disclose and effectively carry out ESG undertakings, which may include forward-looking proposals based on assumptions and subject to

factors beyond our control, could expose us to reputational harm, government enforcement or private litigation, and stock price and volume

ability to use our net operating loss carry forwards and certain other tax attributes may be limited.

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To date, the Delaware Supreme Court has upheld the exclusive

jurisdiction provisions in certificates of incorporation for claims under the Securities Act, but the U.S.

Court of Appeals for the Seventh

Circuit held that a forum selection clause was unenforceable as to a derivative claim that was brought under the Exchange Act.

to date no court has ruled on the exclusive venue provision for claims under the Securities Act.

Accordingly, if a stockholder files

a Securities Act claim or an Exchange Act claim in a federal court and we seek to rely upon the Delaware venues, we may not be successful.

jurisdiction provisions in certificates of incorporation for claims under the Securities Act.

However, two different federal Court of

Appeals reached conflicting decisions with one Court ruling that a forum selection clause was unenforceable as to a derivative claim

that was brought under the Exchange Act.

Further, to date no court has ruled on the exclusive venue provision for claims under the Securities

Act and the other Court ruling it was enforceable.

Accordingly, if a stockholder files a Securities Act claim or an Exchange Act claim

in a federal court and we seek to rely upon the Delaware venues, we may not be successful.

the choice of forum provisions in our Bylaws may have the effect of severing certain causes of action between federal and state courts,

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other employee, agent, or stockholder.

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