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Item 1. Business

2022-03-31 compared with 2021-03-30 · 463 added, 317 removed, 771 unchanged (50% of the section changed)

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Unless otherwise stated, references to particular years, quarters, months or periods refer to our fiscal years ending December 31 and the associated quarters, months and periods of those fiscal years.

We are a clinical-stage biopharmaceutical company committed to advancing innovative products for women’s health.

We are driven by a mission to identify, develop and bring to market a diverse portfolio of differentiated therapies that expand treatment options, improve outcomes and facilitate convenience for women, primarily in the areas of contraception, vaginal health, sexual health and fertility.

Our business strategy is to in-license or otherwise acquire the rights to differentiated product candidates in our areas of focus, some of which have existing clinical proof-of-concept data, to take those candidates through mid to late-stage clinical development, and to establish and leverage strategic partnerships to achieve commercialization.

We are a biopharmaceutical company committed to advancing innovative products for women’s health.

We are driven by a mission to identify, develop and bring to market a diverse portfolio of differentiated therapies that prioritize women's health and well-being, expand treatment options, and improve outcomes, primarily in the areas of contraception, fertility and vaginal and sexual health.

Our first product, XACIATO™ (clindamycin phosphate vaginal gel, 2%), was approved by the FDA in December 2021 for the treatment of bacterial vaginosis in females 12 years of age and older.

In March 2022, we entered into an exclusive global license agreement with an affiliate of Organon & Co., Organon International GmbH, or Organon, to commercialize XACIATO.

XACIATO is expected to be available commercially in the United States in the fourth quarter of 2022.

We began assembling our diverse portfolio of clinical-stage product candidates and pre-clinical programs in 2017 through acquisitions, exclusive in-licenses and other collaborations.

Our programs target unmet needs in women’s health in the areas of contraception, fertility and vaginal and sexual health and aim to expand treatment options, enhance outcomes and improve ease of use for women.

We are primarily focused on progressing the development of our existing product candidates.

We are also exploring opportunities to expand our portfolio by leveraging assets to which we hold rights or obtaining rights to new assets, with continued focus solely on women's health.

We believe the product candidates in our portfolio offer innovative approaches that may provide meaningful benefits over current therapeutic or contraceptive options.

We evaluate potential new product candidates based on similar selection criteria as we applied in assembling our existing portfolio.

Our product candidates, if approved for commercial sale, would be prescription products.

The following graphic summarizes our portfolio, including targeted indications, development status and milestones:

Our goal is to bring to market innovative products in women’s health, primarily in the areas of contraception, fertility and vaginal and sexual health.

We plan to achieve this goal by advancing the drug and drug/device combination product candidates in our portfolio through mid- to late-stage clinical development, and potentially regulatory approval, as well as by establishing and leveraging strategic partnerships and other collaborations to complete product development and commercialize our products, if approved.

We are also exploring portfolio expansion through both business development activities that may result in acquiring, or acquiring access to, new product candidates through in-licensing or other collaborative arrangements, and leveraging assets we previously acquired or in-licensed from third parties.

As with our current portfolio, we look for innovations in women’s health that have (a) attractive market opportunities and potential to address an unmet medical need, including through new formulations, manners of application or delivery methods of well-known drug substances that result in novel, product candidates customized for women, (b) human proof-of-concept clinical data previously generated by third parties and/or potential to utilize the FDA's 505(b)(2) pathway, and (c) potential to become a first-in-category or first-line product.

We believe that there is an opportunity to fill the gap that exists in the development of innovations in women’s health between (a) non-profit organizations, small private companies and individual entrepreneurs that discover, innovate and conduct early-stage research and clinical development of product candidates, and (b) pharmaceutical companies that conduct late-stage clinical development and commercialize approved products.

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In addition, we believe there are gaps in treatment options in the women's health market and there is an opportunity to provide therapies that address persistent unmet needs.

We intend to fill the mid-stage development gap and to address the gaps in treatment options for women.

The dynamics of the women’s health market provide an opportunity for us to assemble a portfolio of product candidates, including clinical-stage candidates, often with published human data.

Since July 2017, we have assembled a portfolio of clinical-stage and pre-clinical-stage candidates.

While we will continue to assess opportunities to expand our portfolio, our current focus is on advancing our existing product candidates through mid and late stages of clinical development or FDA approval.

Our Clinical-Stage and Phase 1-ready Product Candidates and Programs

Our development strategy is two-fold:

(1) We intend to use existing data and any data we generate to prepare Investigational New Drug applications, or INDs, or Investigational Device Exemption applications, or IDEs, to the extent these have not already been prepared, and to design and implement additional pre-clinical and clinical trials to advance our programs toward the submission of New Drug Applications, or NDAs, or Premarket Approvals, or PMAs, for regulatory approval of our product candidates in the U.S.

(2) We intend to identify FDA-approved drugs and therapies that might benefit from a different formulation, manner of application or delivery method to enhance therapeutic outcomes and to expedite the development of these candidates under the FDA's 505(b)(2) pathway.

Our initial focus is in the areas of contraception, vaginal health, sexual health and fertility, and we have acquired, or acquired rights to, candidates in these areas with promising early clinical and/or pre-clinical testing data developed by third parties.

We believe the product candidates currently in our portfolio offer innovative therapeutic approaches that may provide meaningful benefits over current treatment options.

Our portfolio includes three product candidates in advanced stages of clinical development and three product candidates in Phase 1 clinical development or that we believe are Phase 1-ready.

The following graphic provides a snapshot of our clinical-stage product candidates, including their targeted indications and our current expectations for their respective stages of development in 2021:

DARE-BV1 is a novel thermosetting bioadhesive hydrogel formulated with clindamycin phosphate 2% that we are developing as a first - line, single-administration treatment for bacterial vaginosis.

Clindamycin is an antibiotic with FDA approval to treat certain bacterial infections, including in cream formulations to treat bacterial vaginosis.

DARE-BV1 is designed to transition from a viscous liquid to a bioadhesive gel at body temperature following vaginal self-administration.

The bioadhesive properties and release profile of DARE-BV1 are expected to reduce leakage and prolong the duration of exposure to the active drug relative to currently marketed creams and gels with FDA-approval to treat bacterial vaginosis , potentially improving the rate of clinical effectiveness compared to those existing therapies.

We plan to leverage existing safety and efficacy data on clindamycin to utilize the FDA's 505(b)(2) pathway to obtain marketing approval of DARE-BV1 for bacterial vaginosis in the U.S.

We are not aware of any unexpired patent or non-patent market exclusivities for clindamycin, and we do not expect to make any Paragraph IV certification in the NDA for DARE-BV1.

The FDA's 505(b)(2) pathway and Paragraph IV certifications are described in more detail below under "Government Regulation – U.S.

Government Regulation – FDA Approval Process for Prescription Drugs – Marketing Application Submission and FDA Review," and “Government Regulation – U.S.

Government Regulation – New Drug Marketing Exclusivity under the Hatch-Waxman Act Amendments & GAIN Exclusivity Extension – Orange Book Listing & Patent Certification” and “– Non-Patent Exclusivities.”

We intend to fill the mid-stage development gap and to expand treatment options for women.

Key elements of our business strategy are as follows:

• Advance clinical development of the product candidates in our portfolio through mid- to late-stage clinical development or regulatory approval .

We are targeting a 2022 commencement of a pivotal Phase 3 clinical study of Ovaprene in collaboration with the Eunice Kennedy Shriver National Institute of Child Health and Human Development, or NICHD.

In addition, our Phase 2b RESPOND clinical study of Sildenafil Cream, 3.6% in women with female sexual arousal disorder, or FSAD, is ongoing.

In 2022, we also expect to complete our ongoing Phase 1/2 clinical study of DARE-VVA1 and we are commencing a Phase 1/2 clinical study of DARE-HRT1.

• Explore opportunities to expand our portfolio, with the women’s health market as our sole focus .

While simultaneously advancing our current portfolio, we intend to continue to identify other important unmet needs in women’s health and explore opportunities to build our product pipeline by acquiring or in-licensing new programs or leveraging assets we previously acquired or in-licensed to create new programs that meet our selection criteria.

• Pursue strategic collaborations to enhance our development and commercialization capabilities .

We intend to develop and maintain strategic relationships with commercial stage companies that are leaders or emerging leaders in the women’s health market, as well as with other entities, where we believe such collaborations will accelerate or otherwise improve upon our clinical development and/or product commercialization capabilities.

Our license agreement with Bayer to commercialize Ovaprene, if approved, and our Cooperative Research and Development Agreement, or CRADA, with NICHD for the conduct of the Phase 3 clinical study of Ovaprene are examples of these efforts.

• Seek non-dilutive funding to support product development.

We intend to advance development of our programs through a variety of means, including through non-dilutive funding.

For example, technology development and other preclinical activities for DARE-LARC1 have been supported by funding under grant agreements with a private foundation and we anticipate that our 2021 grant agreement will continue to fund pre-clinical activities for that program through most of 2026, contingent upon the program's achievement of specified milestones.

In addition, clinical development of Ovaprene and pre-clinical development activities for DARE-LARC1 and DARE-PTB1 have been supported by NICHD grant awards.

XACIATO [zah-she-AH-toe] (clindamycin phosphate) vaginal gel (formerly known as DARE-BV1), a lincosamide antibacterial, received FDA approval in December 2021 for the treatment of bacterial vaginosis in female patients 12 years of age and older.

XACIATO is a clear, colorless, viscous gel, which contains clindamycin at a concentration of 2%.

A single-dose user-filled disposable applicator delivers 5 g of vaginal gel containing 100 mg of clindamycin.

XACIATO is our first and only approved product.

We achieved FDA approval of XACIATO three years after acquiring rights to the program.

We commenced and completed a successful pivotal clinical study, prepared and filed a new drug application with the FDA and received notification from the FDA of U.S.

marketing approval, all during the COVID-19 pandemic.

In March 2022, we entered into an exclusive license agreement with Organon pursuant to which Organon will obtain exclusive worldwide rights to develop, manufacture and commercialize XACIATO.

XACIATO is expected to be available commercially in the United States in the fourth quarter of 2022.

See "Strategic Agreements for Product Commercialization" below for further discussion of the terms of our agreement with Organon.

XACIATO previously received both Qualified Infectious Disease Product (QIDP) and Fast Track designations from the FDA for the treatment of bacterial vaginosis in women.

As a result of the QIDP designation, XACIATO was eligible to receive a five-year extension of the three years of data exclusivity in the U.S.

available to the product based on the submission of new clinical data that were essential to its approval.

The FDA granted XACIATO for the treatment of bacterial vaginosis in female patients 12 years of age and older three years of data exclusivity, which was extended by five years, such that the data exclusivity period is set to expire on December 7, 2029.

XACIATO has also been designated as a reference listed drug by the FDA for purposes of future generic drug development.

The data exclusivity period should block the FDA from approving either a subsequent abbreviated NDA or 505(b)(2) NDA that relies in whole or in part on our protected clinical data.

See also "Government Regulation - U.S.

Government Regulation- New Drug Marketing Exclusivity under the Hatch-Waxman Act Amendments & GAIN Exclusivity Extension" below.

According to the Centers for Disease Control and Prevention, or the CDC, bacterial vaginosis is the most common vaginal condition in women ages 15-44.

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Symptoms include vaginal discharge, vaginal odor, vaginal pain, itching or burning, and burning during urination.

We believe current bacterial vaginosis therapies are inadequate and there is a significant unmet need for better treatment.

Current FDA-approved therapies have clinical cure rates (based on the Amsel criteria) ranging from 37-68%.

In August 2019, the FDA granted DARE-BV1 Qualified Infectious Disease Product (QIDP) designation for the treatment of bacterial vaginosis in women.

Because of its QIDP designation, if DARE-BV1 is approved by the FDA for the treatment of bacterial vaginosis in women, we expect it to receive the five-year GAIN Act exclusivity extension to any non-patent marketing exclusivity period for which it qualifies upon approval.

In March 2020, we announced that we received Fast Track designation from the FDA for DARE-BV1 for the treatment of bacterial vaginosis.

The designation offers the opportunity for more frequent interactions with the FDA to discuss DARE-BV1's development plan and ensure collection of appropriate data needed.

The Fast Track program is intended to facilitate development and expedite review of a Fast Track drug so that an approved product can reach the market expeditiously.

Given DARE-BV1's QIDP and Fast Track designations, its NDA for bacterial vaginosis could be eligible for priority review by the FDA, and we intend to request priority review upon submission of the NDA as further discussed below.

For additional information about the FDA's QIPD, Fast Track and priority review programs, please see the discussion below under "Government Regulation – U.S.

Government Regulation – FDA Approval Process for Prescription Drugs – Special FDA Programs to Facilitate and Expedite Development and Review of Certain New Drugs" and "Government Regulation – U.S.

Government Regulation – New Drug Marketing Exclusivity under the Hatch-Waxman Act Amendments & GAIN Exclusivity Extension – Qualified Infectious Disease Product Exclusivity."

Prior to our involvement, DARE-BV1 was evaluated in an investigator-initiated proof-of-concept study that enrolled 30 women, ages 18 to 50, to assess its efficacy in treating bacterial vaginosis after a single administration.

The study’s primary efficacy endpoint was clinical cure based on the Amsel criteria at the test-of-cure evaluation visit, or Visit 2, which was approximately 7 to 14 days after administration of DARE-BV1.

Of the 28 evaluable subjects, 24, or 86%, achieved clinical cure at Visit 2.

The women were asked to return to the clinic for a third visit, or Visit 3, approximately 21 to 30 days following administration of DARE-BV1 to evaluate continued efficacy of treatment.

Of the 24 subjects who completed Visit 2 and were deemed clinically cured, 23, or 96% , remained clinically cured at Visit 3.

There were no reports of adverse reactions, including local reactions to DARE-BV1.

In December 2020, we announced positive topline results from our DARE-BVFREE Phase 3 clinical trial of DARE-BV1 for the treatment of bacterial vaginosis.

As further discussed below, the study met its primary endpoint, demonstrating that a single administration of DARE-BV1 was superior to placebo as a primary therapeutic intervention for women diagnosed with bacterial vaginosis.

DARE-BVFREE was a randomized, multicenter, double-blind, placebo-controlled study that randomized 307 women diagnosed with bacterial vaginosis at 32 centers across the United States in a 2:1 ratio to receive a single vaginal dose of DARE-BV1 (clindamycin phosphate vaginal gel, 2%) (N=204) or a single vaginal dose of placebo gel (HEC Universal Placebo Gel) (N=103) to be applied intravaginally within one day of randomization.

Subjects were

evaluated during three clinic visits:

Day 1 (screening and randomization visit), Day 7-14 (assessment visit that occurred 7 to 14 days after study drug administration), and Day 21-30 (test-of-cure visit that occurred 21 to 30 days after study drug administration).

The primary endpoint for the study was clinical cure of bacterial vaginosis determined at the Day 21-30 visit in the modified intent-to-treat (mITT) study population (N=180).

In accordance with FDA guidance, the mITT population excludes subjects from the intent-to-treat (ITT) population (N=307) who subsequently demonstrated a positive test result for other concomitant vaginal or cervical infections at baseline.

Clinical cure was defined as resolution of the specific clinical signs that comprise the Amsel criteria;

specifically, resolution of abnormal vaginal discharge associated with bacterial vaginosis, clue cells less than 20% of total epithelial cells on microscopy, and a negative 10% KOH “whiff” test.

The total study duration was approximately one month for each individual subject.

DARE-BV1 demonstrated statistically significant efficacy in the primary endpoint and in all five pre-specified secondary efficacy assessments.

The clinical cure endpoint results are shown in the following table:

Summary of Clinical Cure Results (mITT Population), p-value < 0.001

We entered this therapeutic category because we felt there was a significant unmet need for better treatment.

Branded prescription products that received FDA approval before XACIATO for the treatment of bacterial vaginosis have clinical cure rates (based on the Amsel criteria) ranging from 37-68%.

XACIATO is contraindicated in individuals with a history of hypersensitivity to clindamycin or lincomycin.

Its prescribing information contains warnings and precautions about clostridioides difficile -associated diarrhea, XACIATO’s incompatibility with and potential to weaken polyurethane condoms so as to make them unreliable for preventing pregnancy or protecting against sexually transmitted diseases (therefore, polyurethane condoms should not be used during treatment with XACIATO or for 7 days following treatment;

latex or polyisoprene condoms should be used), and vaginal candida infections.

The most common adverse reactions reported in >2% of patients and at a higher rate in the XACIATO group than in the placebo group in the pivotal DARE-BVFREE trial were vulvovaginal candidiasis and vulvovaginal discomfort.

Systemic clindamycin has neuromuscular blocking properties that may enhance the action of other neuromuscular blocking agents.

It should be used with caution in patients receiving such agents.

Other clindamycin vaginal products have been used to treat pregnant women during the second and third trimester.

XACIATO has not been studied in pregnant women.

However, based on the low systemic absorption of XACIATO following the intravaginal route of administration in nonpregnant women, maternal use is not likely to result in significant fetal exposure to the drug.

Similarly, because systemic absorption following intravaginal administration of clindamycin is low, transfer of the drug into breastmilk is likely to be low and adverse effects on the breastfed infant are not expected.

The safety and effectiveness of XACIATO have not been established in pediatric patients younger than 12 years of age.

XACIATO has not been evaluated in geriatric patients (65 years of age or older) to determine whether they respond differently than younger patients.

Clinical Data

The efficacy of XACIATO as a treatment of bacterial vaginosis in females 12 years of age and older was demonstrated in the Phase 3 DARE-BVFREE trial (NCT04370548), a randomized, double-blind, placebo-controlled clinical study that randomized 307 patients at 32 centers across the United States.

A single dose of XACIATO was compared to a single dose of placebo vaginal gel (hydroxyethylcellulose [HEC] Universal Placebo Gel) for the treatment of bacterial vaginosis.

Patients were evaluated at three timepoints:

a Day 1 screening/randomization visit, a Day 7 to 14 Interim Assessment visit, and a Day 21 to 30 Test of Cure visit.

The total study duration was up to approximately one month for each individual patient.

To be eligible, patients had to have a clinical diagnosis of bacterial vaginosis defined as an off-white (milky or gray), thin, homogeneous discharge with minimal or absent pruritus and inflammation of the vulva and vagina, clue cells > 20% of the total epithelial cells on microscopic examination of the saline wet mount, vaginal secretion pH of > 4.5, and a fishy odor of the vaginal discharge with the addition of a drop of 10% KOH (i.e., a positive whiff test).

The 307 patients were randomized in a 2:1 ratio, with 204 in the XACIATO group and 103 in the placebo group.

The modified Intent-To-Treat (mITT) Population excluded women with a positive test result for other concomitant vaginal or cervical infections at baseline, including a positive vaginal culture for Candida spp.

or who had a baseline Nugent score of < 7.

Clinical Cure was defined as resolution of the abnormal vaginal discharge associated with bacterial vaginosis, a negative 10% KOH whiff test, and clue cells < 20% of the total epithelial cells in the saline wet mount.

Bacteriological Cure was defined as a Nugent score < 4.

Therapeutic Cure was defined as the presence of both a Clinical Cure and Bacteriological Cure.

In the mITT population, a statistically significantly greater percentage of patients experienced Clinical Cure, Bacteriological Cure, and Therapeutic Cure at the Test of Cure (Day 21-30) visit in the XACIATO arm compared to placebo (Table 1).

Statistically significant results for the endpoints were also achieved at the Interim Assessment visit (Day 7-14).

Summary of Clinical Cure, Bacteriological Cure, and Therapeutic Cure (mITT Population)

Interim Assessment visit (day 7-14) Test of Cure visit (day 21-30)

Parameter XACIATO

n (%) Placebo

Clinical Cure at Day 7-14 visit 76.0% 23.7%

Clinical Cure at Day 21-30 visit (primary endpoint) 70.2% 35.6%

The clinical cure rate at the Day 21-30 visit for the ITT population was similar to that for the mITT population (70.1% for the DARE-BV1 group (N=204) and 36.9% for the placebo group (N=103), p-value < 0.001).

The clinical cure rate at the Day 21-30 visit for the per protocol (PP) population was 77.2% for the DARE-BV1 group (N=101) and 42.6% for the placebo group (N=47).

The PP population (N=148) means subjects from the mITT population who have no major protocol violations that impact the primary or secondary endpoints or who received any other bacterial vaginosis therapy for any reason.

The clinical cure rate at the Day 7-14 visit for the PP population was 81.2% for the DARE-BV1 group (N=101) and 29.8% for the placebo group (N=47).

DARE-BV1 was well-tolerated in the study.

There were no early discontinuations due to adverse events (AEs), and the only serious AE occurred in a woman in the placebo group.

In the DARE-BV1 group, 15.3% of patients reported AEs that were considered to be possibly, probably or definitely related to study treatment compared to 9.7% of patients in the placebo group.

Only two AEs were reported by more than 2% of patients in the DARE-BV1 group and at a rate higher than in patients in the placebo group – vulvovaginal candidiasis, commonly called a vaginal yeast infection (17.2% in the DARE-BV1 group and 3.9% in the placebo group), and vulvovaginal pruritus, commonly referred to as vaginal itching (4.4% in the DARE-BV1 group and 1.9% in the placebo group).

Over half of the vaginal yeast infections reported in the DARE-BV1 group and exactly half of those reported in the placebo group occurred in patients who exhibited a positive yeast culture prior to dosing.

Based on the topline results from the DARE-BVFREE study and our meetings and other communications with the FDA since we announced those results, we plan to submit an NDA for DARE-BV1 for the treatment of bacterial vaginosis by the end of the second quarter of 2021.

We have requested an application fee waiver for the NDA submission, using the small business eligibility criteria available under the Prescription Drug User Fee Act, or PDUFA, and anticipate that the FDA will grant that fee waiver.

As discussed above, we intend to request priority review status for the NDA upon submission, which, if granted, could allow for a review period of six months from the FDA's receipt of our NDA submission, rather than the 10-month review period for non-priority submissions.

Assuming we submit our DARE-BV1 NDA in the second quarter of 2021, the FDA grants priority review and sets a goal date for a decision, or a PDUFA date, within approximately six months from the NDA submission date, and the FDA approves the NDA in 2021, we would expect a commercial launch of DARE-BV1 in the United States in early 2022.

n (%) Treatment Difference (%) [95% Confidence Interval] XACIATO

n (%) Placebo

n (%) Treatment Difference (%) [95% Confidence Interval]

Cure 93 (76.2) 14 (23.7) 52.5 (38.0, 67.0) 86 (70.5) 21 (35.6) 34.9 (19.0, 50.8)

Bacteriological Cure 50 (41.0) 2 (3.4) 37.6 (26.5, 48.7) 53 (43.4) 3 (5.1) 38.4 (26.7, 50.1)

Cure 43 (35.2) 0 32.5 (25.5, 45.0) 45 (36.9) 3 (5.1) 31.8 (20.3, 43.3)

The percentage of patients with Clinical Cure at the Test of Cure visit was also significantly higher in the XACIATO group compared to the placebo group among the subsets of patients defined by prior episodes of bacterial vaginosis (≤ 3 episodes and >3 episodes in the previous 12 months) at 71.3% (72/101) for XACIATO and 39.1% (18/46) placebo, and 70.0% (14/20) for XACIATO and 23.1% (3/13) placebo, respectively.

The median age of the patients in the trial was 35 years (range 15-59 years).

The population was 56% Black or African American and 41% White.

Persons of Hispanic or Latino ethnicity made up 25% of the population.

A history of prior bacterial vaginosis was noted in 89% of the population.

XACIATO was well-tolerated in the trial.

Our Pipeline:

Clinical-Stage Programs

We believe the need for more effective and convenient options is particularly true with contraception.

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an effective, short-acting, hormone-free method of contraception that does not require intervention at the time of intercourse.

Ovaprene is a novel, investigational hormone-free monthly intravaginal contraceptive designed to be worn conveniently over multiple weeks (one menstrual cycle) and with the potential to achieve “typical use” contraceptive efficacy comparable to current FDA-approved non-implanted hormonal contraceptive methods (pills, patches and vaginal rings), which is approximately 91% typical use efficacy.

Typical use contraceptive efficacy refers to the expected rate of pregnancy prevention during the first year of actual use of a method, including sometimes using the

method in a way that is not correct or not consistent.

efficacy approaching that of current FDA-approved non-implanted hormonal contraceptive methods (pills, patches and vaginal rings), which is approximately 91% typical use efficacy.

Typical use contraceptive efficacy refers to the expected rate of pregnancy prevention during the first year of actual use of a method, including sometimes using the method in a way that is not correct or not consistent.

Ovaprene features a proprietary knitted polymer barrier to physically block sperm from entering the cervical canal within a silicone-reinforced ring that releases non-hormonal agent ferrous gluconate to impede sperm motility.

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If approved, Ovaprene could be the first hormone-free, monthly contraceptive option for women.

Ovaprene is a combination product and, following a request for designation process, the FDA designated the Center for Devices and Radiological Health, or CDRH, as the lead FDA program center for premarket review and product regulation.

CDRH has determined that premarket approval will be required to market Ovaprene in the U.S.

Ovaprene is composed of both device and drug components and is considered a combination product by the FDA.

Ovaprene previously underwent a request for designation process with the FDA that determined that the Center for Devices and Radiological Health, or CDRH, would lead the review of a premarket approval, or PMA, for potential marketing approval in the U.S.

Clinical Data

In a postcoital test, or PCT, pilot clinical study conducted by the previous sponsor in 20 women and published in The Journal of Reproductive Medicine® in 2009, Ovaprene demonstrated the ability to immobilize sperm and prevent their progression into the cervical mucus.

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Infertility research suggests that higher rates of pregnancy are associated with PMS per HPF of from greater than one to greater than 20 sperm, and less than five PMS per HPF is considered indicative of contraceptive effectiveness.

Based on the positive results of our PCT clinical trial of Ovaprene, and with the support of Bayer under the commercial license agreement discussed below, we are conducting activities to support submission of an IDE to the FDA in the fourth quarter of 2021 for a pivotal clinical study of Ovaprene.

We are designing the study to evaluate the safety and efficacy of Ovaprene to prevent pregnancy when used over a period of at least six months and up to approximately 12 months by approximately 250 women.

We will seek to confirm alignment with the FDA on the study's design prior to commencement.

Our ongoing communications with the FDA regarding the trial design include discussion of the amount of product use sufficient to demonstrate efficacy and safety (i.e., the number of study subjects to complete evaluation and the total number of menstrual cycles to be assessed using Ovaprene).

We believe that the development activities we are conducting prior to commencement of the planned pivotal study will continue to advance this program and enable a study start by the first quarter of 2022 and a six-month safety and efficacy data readout by year-end 2022.

If the planned pivotal clinical study is successful, we expect the study's data to support a PMA submission to the FDA, as well as regulatory filings in Europe and other countries worldwide, to allow for marketing approvals of Ovaprene.

We are developing Ovaprene with ADVA-Tec, Inc.

and Bayer HealthCare LLC, or Bayer, as part of two strategic collaborations announced in March 2017 and January 2020, respectively.

See "License Agreements" below for discussion of the terms of e ach collaboration.

Pivotal Phase 3 Clinical Study

In January 2022, we initiated an Investigational Device Exemption, or IDE, review process with the FDA for a multi-center, non-comparative, pivotal Phase 3 clinical study of the safety and efficacy of Ovaprene to prevent pregnancy.

Our IDE submission was subsequently converted to an IDE pre-submission so that the FDA could engage in a collaborative discussion with us regarding items that must be addressed prior to enrollment of any subjects in the Phase 3 study.

This process is ongoing and we believe it will allow us to finalize the protocol and design of the study as the registration study to support a future PMA submission.

Based on communications with the FDA, in terms of study sample size and duration, we expect that at least 200 subjects completing 12 months of Ovaprene use will be adequate.

We are targeting commencement of the Phase 3 study during 2022.

In July 2021, we entered into the CRADA with the U.S.

Department of Health and Human Services, as represented by NICHD, part of the National Institutes of Health, for the conduct of the Phase 3 study, which will be conducted within NICHD’s Contraceptive Clinical Trial Network with NICHD contractor Health Decisions Inc., a

contract research organization, providing clinical coordination and data collection and management services.

We and NICHD will each provide medical oversight and final data review and analysis for the study and will work together to prepare the final report of the results of the study.

We are responsible for providing clinical supplies of Ovaprene, coordinating interactions with the FDA, preparing and submitting supportive regulatory documentation, and providing a total of $5.5 million in payments to NICHD to be applied toward the costs of conducting the Phase 3 study.

NICHD will be responsible for the other costs related to the conduct of the Phase 3 study and will manage the payment of expenses to Health Decisions Inc., the clinical sites, and other parties involved with the study.

If the planned Phase 3 study is successful, we expect the data to support a pre-market approval submission, or PMA, to the FDA, as well as regulatory filings in Europe and other countries worldwide, to allow for marketing approvals of Ovaprene.

In addition to the CRADA, we are collaborating with ADVA-Tec, Inc.

and Bayer HealthCare LLC, or Bayer, for the development and commercialization of Ovaprene as part of two strategic collaborations announced in March 2017 and January 2020, respectively.

See "Strategic Agreements for Pipeline Development" and "Strategic Agreements for Product Commercialization" below for discussion of the terms of e ach collaboration.

Sildenafil Cream, 3.6%

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Sildenafil Cream, 3.6% is designed to facilitate vasodilation and increase genital blood flow, and, as a result, to provide improvements in the female genital arousal response, while avoiding systemic side effects observed with oral formulations of sildenafil.

Clinical Data

In a Phase 1 clinical study of three escalating doses of topical sildenafil cream (1 g cream with 35 mg sildenafil;

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The study, which was designed to evaluate up to 10 subjects, achieved the study objectives based on a planned interim analysis of the first six completed subjects, and thus additional subjects were not enrolled.

In this study, Sildenafil Cream, 3.6% demonstrated significantly greater increases in genital temperature compared to placebo cream, indicating a positive impact on genital blood flow during the 30-minute post-dosing testing session, with statistical separation from placebo cream within the first 15 minutes after dosing.

In this study, Sildenafil Cream, 3.6% demonstrated significantly greater increases in genital temperature compared to

placebo cream, indicating a positive impact on genital blood flow during the 30-minute post-dosing testing session, with statistical separation from placebo cream within the first 15 minutes after dosing.

Additionally, significantly greater self-reported arousal responses were reported during Sildenafil Cream, 3.6% visits compared to placebo cream visits.

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The findings of that study helped facilitate alignment with the FDA on acceptable efficacy endpoints in our Phase 2b clinical study and future Phase 3 program, including with respect to the patient reported outcome, or PRO, instruments to be used to screen eligible patients with FSAD and to measure achievement of the primary efficacy endpoint in the Phase 2b study.

In March 2021, we announced initiation of our Phase 2b RESPOND clinical study of Sildenafil Cream, 3.6% in women with FSAD and that we are targeting a topline data readout by year-end 2021.

During the planned Phase 2b RESPOND clinical trial, subjects will use Sildenafil Cream, 3.6% and placebo cream in their home setting and will document genital arousal symptoms and distress using PRO instruments.

The primary efficacy endpoint of the study

is a composite endpoint that includes patient-reported improvement in genital sensations of arousal and reduction in distress associated with FSAD.

The Phase 2b RESPOND trial is designed to evaluate Sildenafil Cream, 3.6% compared to placebo cream over 12 weeks of dosing following both a non-drug and placebo run-in period.

The Phase 2b RESPOND study is expected to randomize 400 to 590 subjects into the double-blind dosing period from 40 to 50 sites in the U.S.

Phase 2b RESPOND Clinical Study

In March 2021, we announced initiation of our Phase 2b RESPOND clinical study of Sildenafil Cream, 3.6% in women with FSAD.

During the Phase 2b RESPOND clinical study, subjects will use Sildenafil Cream, 3.6% and placebo cream in their home setting and will document genital arousal symptoms and distress using PRO instruments.

The primary efficacy endpoint of the study is a composite endpoint that includes patient-reported improvement in genital sensations of arousal and reduction in distress associated with FSAD.

The Phase 2b RESPOND clinical study is designed to evaluate Sildenafil Cream, 3.6% compared to placebo cream over 12 weeks of dosing following both a non-drug and placebo run-in period.

The study is expected to randomize 400 to 590 subjects into the double-blind dosing period at 40 to 50 clinical sites in the U.S.

to ensure a total of 300 (150:150) to 440 (220:220) subjects complete the 12-week double-blind dosing period.

The final study sample size will be determined by a single interim analysis for unblinded sample size re-estimation, based on the study’s adaptive design.

The final size of the study will be determined by a single interim analysis for unblinded sample size re-estimation, based on the study’s adaptive design.

An adaptive design implemented in accordance with the FDA’s Guidance for Industry on adaptive designs for clinical trials of drugs mitigates the risk of the study being underpowered if the true treatment effect and variability are significantly different from estimates based on published data but are still clinically meaningful.

Our target timeline for topline data readout of the Phase 2b RESPOND study assumes that enrollment proceeds successfully and that an increase in sample size above 400 randomized subjects is not required.

We will continue to actively engage with the FDA in 2021 to help ensure that any additional required studies and development activities may be completed during the course of the clinical development program to support an NDA submission.

The pace of enrollment of participants in the trial has been slower than initially expected.

While the COVID-19 pandemic contributed in part to the slower pace of enrollment, we identified a number of other contributing factors, and we implemented mitigation strategies and adapted certain requirements to increase study subject recruitment.

We do not expect these changes to impact trial results.

We anticipate that the planned interim analysis will be conducted in 2022, after which we will be able to predict the timeframe for announcement of topline data from this trial.

We are developing Sildenafil Cream, 3.6% with Strategic Science & Technologies-D LLC under our license and collaboration agreement announced in February 2018.

See “License Agreements” below for discussion of the terms of this collaboration.

DARE-HRT1 is a unique IVR containing bio-identical estradiol and bio-identical progesterone that is designed to be worn over multiple weeks for sustained drug delivery for the treatment of vasomotor and vaginal symptoms associated with menopause as part of a hormone therapy regimen.

See “Strategic Agreements for Pipeline Development” below for discussion of the terms of this collaboration.

DARE-HRT1 is a unique intravaginal ring, or IVR, designed to deliver bio-identical 17β-estradiol and bio-identical progesterone continuously over a 28-day period as part of a hormone therapy regimen to treat the vasomotor symptoms, or VMS, and genitourinary syndrome associated with menopause.

The IVR technology used in DARE-HRT1 was developed by Dr.

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Hormone therapy is considered the most effective treatment for vasomotor symptoms, commonly referred to as hot flashes, and the genitourinary syndrome of menopause, and it has been shown to prevent bone loss and fracture.

Following clinical development, we intend to leverage existing safety and efficacy data on estradiol and progesterone, the active ingredients in DARE-HRT1, to utilize the FDA's 505(b)(2) pathway to obtain marketing approval in the U.S.

There are currently no FDA-approved IVRs that deliver bio-identical progesterone in combination with bio-identical estradiol.

As such, DARE-HRT1 has the potential to be a first-in-category product that offers monthly convenience for women.

We intend to leverage the existing safety and efficacy data on the active ingredients in DARE-HRT1, estradiol and progesterone, to utilize the FDA’s 505(b)(2) pathway to obtain marketing approval of DARE-HRT1 in the U.S.

In July 2020, our wholly-owned Australian subsidiary commenced a Phase 1 open-label, three-arm, parallel group clinical study of DARE-HRT1 to evaluate the pharmacokinetics, or PK, and safety of DARE-HRT1 in approximately 30 healthy, post-menopausal women at specialty women's health sites in Australia.

The primary objective of the study is to describe the PK parameters of two different dose combinations (estradiol 80 µg/progesterone 4 mg IVR and estradiol 160 µg/progesterone 8 mg IVR) over 28 days.

Secondary endpoints of the study include assessing the safety and tolerability of DARE-HRT1 and comparing the exposure of estradiol, estrone, and progesterone of DARE-HRT1 over 28 days against a daily combination of oral estrogen (Estrofem®) and oral progesterone (Prometrium®).

We completed enrollment in the study in March 2021 and anticipate reporting topline data in the second quarter of 2021.

Clinical Data

In June 2021, we announced positive topline results from our Phase 1 clinical trial of DARE-HRT1.

The randomized, open-label, three-arm, parallel group trial evaluated the pharmacokinetics, or PK, and safety of DARE-HRT1 in approximately 30 healthy, post-menopausal women with intact uteri, and was conducted by our wholly owned Australian subsidiary at specialty women's health sites in Australia.

The primary objective of the study was to describe the PK parameters of two different dose combinations (estradiol 80 µg/progesterone 4 mg IVR and estradiol 160 µg/progesterone 8 mg IVR) over 28 days.

Secondary endpoints of the study were to assess the safety and tolerability of DARE-HRT1 and compare the systemic exposure of estradiol, estrone, and progesterone of DARE-HRT1 over 28 days against a daily combination of oral estrogen (Estrofem®) and oral progesterone (Prometrium®).

Baseline-corrected steady state release level data from the study demonstrate that both the lower (IVR1) and higher (IVR2) dose versions of DARE-HRT1 successfully delivered the bio-identical estradiol and bio-identical progesterone over the 28-day evaluation period (Table 2).

Baseline-Corrected Steady State Levels of Estradiol and Progesterone

(Standard Deviation)

DARE-HRT1 IVR1 (n=10)

Estradiol 20.6 (16.8) pg/mL

Progesterone 1.32 (0.20) ng/mL

DARE-HRT1 IVR2 (n=11)

Estradiol 32.5 (9.3) pg/mL

Progesterone 2.23 (0.61) ng/mL

The levels of estradiol released from each formulation of DARE-HRT1 evaluated in the study achieved or exceeded the levels that were targeted for hormone therapy.

Target levels of estradiol for hormone treatment for either the VMS or vaginal symptoms of menopause were established by reviewing PK levels published for FDA-approved products for both the treatment of VMS as well as the genitourinary symptoms of menopause.

Based on the estradiol PK data in the Phase 1 study, the results support further development of DARE-HRT1 as a potentially effective hormone therapy for both VMS and vaginal symptoms associated with menopause.

The levels of progesterone released from each version of DARE-HRT1 evaluated in the study met the objectives of releasing progesterone.

Progesterone is used in hormone therapy to reduce the impact of estrogen on nontarget sites, such as the endometrium, to prevent estrogen-induced endometrial hyperplasia.

The study treatment was well tolerated with the most common adverse events consistent with other vaginal products.

There was only one early discontinuation due to an adverse event, which was found to be unrelated to study treatment or participation, and no serious adverse events were reported.

The proportion of participants reporting adverse events was similar across all dose groups, the two DARE-HRT1 groups as well as the group receiving a daily combination of FDA-approved oral estrogen and oral progesterone products, with 89% of adverse events mild in severity and all other adverse events (11%) rated as moderate.

DARE-HRT1 had a high level of acceptability in the study, with over 80% of subjects on the lower and higher dose versions of DARE-HRT1 reporting the IVR as comfortable or very comfortable.

Additionally, over 80% of subjects in each IVR dose group stated they were either somewhat or very likely to use the IVR for a women’s health condition or disease if needed.

Phase 1/2 Clinical Study

We are commencing a Phase 1/2 clinical study of DARE-HRT1 in Australia in the second quarter of 2022.

The open-label study will evaluate the PK of the lower and higher dose versions of DARE-HRT1 in approximately 20 healthy, post-menopausal women with intact uteri over approximately three consecutive months of use.

The study will also collect safety, usability, acceptability and symptom-relief data.

We are developing DARE-HRT1 under our license agreement with Catalent JNP, Inc.

See “License Agreements” below for discussion of the terms of that agreement.

DARE-FRT1 is an IVR designed to deliver bio-identical progesterone over a 14-day period and is being developed for the prevention of preterm birth and for broader luteal phase support as part of an in vitro fertilization, or IVF , treatment plan.

DARE-FRT1 was developed from the same IVR technology platform as DARE-HRT1.

We plan to continue to conduct development activities for DARE-FRT1 in preparation for a Phase 1 clinical trial anticipated to start in 2022.

The timing and availability of additional funding will impact the timing of initiation of a Phase 1 clinical study of DARE-FRT1.

We intend to leverage the existing safety and efficacy data for progesterone to utilize the FDA’s 505(b)(2) pathway to obtain marketing approval of DARE-FRT1 in the U.S.

We are developing DARE-FRT1 under our license agreement with Catalent JNP, Inc.

See "License Agreements" below for discussion of the terms of that agreement.

See “Strategic Agreements for Pipeline Development” below for discussion of the terms of that agreement.

DARE-VVA1 is a proprietary formulation of tamoxifen for vaginal administration.

We are developing DARE-VVA1 as an alternative to estrogen-based therapies for the treatment of vulvar and vaginal atrophy, or VVA , in women with or at risk for hormone-receptor positive (HR+) breast cancer, including women on anti-cancer therapy, to treat the symptoms of VVA.

We are developing DARE-VVA1 as an alternative to estrogen-based therapies for the treatment of moderate to severe vulvar and vaginal atrophy, or VVA , in women with or at risk for hormone-receptor positive (HR+) breast cancer, including women on anti-cancer therapy, to treat the symptoms of VVA.

Tamoxifen is a well-known and well-characterized selective estrogen receptor modulator, or SERM.

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Due to the prevalence of aromatase inhibitors for the treatment of HR+ breast cancer, the prevalence of VVA in post-menopausal breast cancer patients is estimated to be between 42 and 70 percent.

We plan to continue to conduct development activities for DARE-VVA1 in preparation for a Phase 1 clinical trial anticipated to start during the second half of 2021.

The timing and availability of additional funding will impact the timing of initiation of a Phase 1 clinical study of DARE-VVA1.

We intend to leverage the existing safety and efficacy data for tamoxifen to utilize the FDA’s 505(b)(2) pathway to obtain marketing approval of DARE-VVA1 in the U.S.

An exploratory study of vaginal administration of tamoxifen in four healthy postmenopausal women diagnosed with VVA published in Clinical and Experimental Obstetrics & Gynecology demonstrated that tamoxifen self-administered intravaginally for three months clinically benefited women with symptoms of VVA without significant systemic absorption of the study drug.

In the open-label prospective cohort study with no placebo arm, participants were instructed to self-administer a vaginal suppository containing tamoxifen (20 mg) daily for one week and twice weekly for three months.

The study treatment was effective in reducing vaginal pH and vaginal dryness.

When measured after eight weeks on the study treatment, serum tamoxifen levels were negligible, 5.8 ng/ml (median), with a range of 1.0 to 10.0 ng/ml.

In comparison, after three months of once daily administration of oral dose of 20-mg tamoxifen, Nolvadex® (tamoxifen citrate) tablets, the average steady state plasma concentration of tamoxifen is 122 ng/ml (range of 71 to 183 ng/ml).

In September 2021, we announced initiation of our Phase 1/2 clinical study of DARE-VVA1.

The randomized, multi-center, double-blind, parallel-arm, placebo-controlled, dose-ranging study is designed to evaluate the safety, tolerability, PK, and pharmacodynamics (PD) of DARE-VVA1 in postmenopausal participants with moderate to severe VVA and is being conducted by our wholly owned Australian subsidiary.

We expect the study will enroll approximately 40 postmenopausal women with VVA, including a cohort of women with a history of hormone-receptor positive breast cancer, at approximately three study sites.

Eligible participants will be randomly allocated to one of the five treatment groups (approximately 8 participants per group) that will evaluate four dose levels (1 mg, 5 mg, 10 mg, and 20 mg) and a placebo.

Following a screening visit, DARE-VVA1 will be self-administered intravaginally once a day for the first two weeks, and then twice a week for the following six weeks for a total treatment period of 56 days.

In each treatment group, participants will have serial blood sampling for PK analysis and undergo safety evaluations and preliminary assessments of effectiveness.

Following the completion of the treatment period, participants will attend a safety follow-up visit.

The primary endpoints of the study will evaluate the safety and tolerability of DARE-VVA1 by vaginal administration and determine the plasma PK of DARE-VVA1 after intravaginal application.

Secondary endpoints will evaluate the preliminary efficacy and PD of DARE-VVA1 in terms of the most bothersome symptom and changes in vaginal cytology and pH.

We anticipate reporting topline data from the study in the second half of 2022.

We acquired the DARE-VVA1 program through our acquisition of Pear Tree Pharmaceuticals in 2018.

See "Strategic Agreements for Pipeline Development" below for discussion of that merger agreement.

DARE-FRT1 and DARE-PTB1

DARE-FRT1 and DARE-PTB1 are IVRs designed to release bio-identical progesterone over a 14-day period.

DARE-FRT1 is being developed for broader luteal phase support as part of an in vitro fertilization, or IVF , treatment plan.

DARE-PTB1 is being developed for the prevention of preterm birth.

Each of DARE-FRT1 and DARE-PTB1 was developed from the same IVR technology platform as DARE-HRT1.

We are conducting development activities in preparation for Phase 1 clinical studies of these product candidates.

We intend to leverage the existing safety and efficacy data for progesterone to utilize the FDA’s 505(b)(2) pathway to obtain marketing approval of DARE-FRT1 and DARE-PTB1 in the U.S.

We are developing DARE-FRT1 and DARE-PTB1 under our license agreement with Catalent JNP, Inc.

See "Strategic Agreements for Pipeline Development " below for discussion of the terms of that agreement.

Our Pipeline:

Pre-Clinical Stage Programs

Our pre-clinical stage programs are:

• DARE-LARC1 , a contraceptive implant delivering levonorgestrel with a woman-centered design that has the potential to be a long-acting, yet convenient and user-controlled contraceptive option;

• ADARE-204 and ADARE-214 , injectable formulations of etonogestrel designed to provide contraception over 6-month and 12-month periods, respectively;

• DARE-RH1 , a novel approach to non-hormonal contraception for both men and women by targeting the CatSper ion channel.

DARE-LARC1, our potential user-controlled, long-acting reversible contraceptive, is designed to store and precisely deliver hundreds of therapeutic doses of the contraceptive levonorgestrel over a period of years and to be controlled by the user, without further intervention by a healthcare provider.

DARE-LARC1’s woman-centered design seeks to offer the benefits of traditional long-acting reversible contraceptives with the added flexibility and convenience for the user to pause and resume release of levonorgestrel, depending on her desire for fertility or contraceptive protection.

Under a grant agreement we entered into in June 2021, we may receive up to $48.95 million, payable over approximately five years, to advance development of the technology through nonclinical proof of principle studies to enable an investigational new drug, or IND, submission.

We received an initial payment under that grant of $11.45 million in 2021.

Additional payments are contingent upon the DARE-LARC1 program's achievement of development and reporting milestones specified in the grant agreement.

Additionally in 2021, we received an unrelated NICHD grant award of approximately $300,000 to be used to explore device insertion and removal in nonclinical studies.

Sales and Marketing

We currently have no formal internal marketing or sales infrastructure or capabilities.

To commercialize our products, if and when our product candidates are approved, we expect to enter into agreements with companies with established marketing, sales and distribution capabilities in women's health in order to supplement our internal marketing or sales efforts.

Such arrangements may include granting pharmaceutical companies with other commercial products in women's health out-licenses to exclusively market, sell and distribute our products in specific geographies, engaging commercial sales organizations to utilize their internal sales organizations and other commercial functions for market access, marketing, distribution, and other related services, or assembling a hybrid of these potential options to co-promote our products.

In January 2020, we entered into an exclusive license agreement with Bayer for the commercialization of Ovaprene in the U.S.

See “License Agreements” below for discussion of the terms of this collaboration.

Manufacturing and Suppliers

We do not own or operate, nor do we currently plan to establish, manufacturing facilities for the production of our product candidates.

We rely on third-party contract manufacturers, or CMOs, to provide all the material and supplies for our nonclinical and clinical studies, and, if our product candidates receive regulatory approval, we expect to rely on CMOs to produce commercial quantities of our products, as well as the raw materials, drug substances, excipients and other supplies required to produce the finished products.

These arrangements allow us to maintain a smaller and more flexible infrastructure.

We have no long-term arrangements for the production or supply of our product candidates or the materials required to produce them, except with respect to Ovaprene and Sildenafil Cream, 3.6%.

Under our agreements with ADVA-Tec and SST, respectively, ADVA-Tec is responsible for providing all clinical trial and commercial supplies of Ovaprene, either directly or through a CMO, and SST is responsible for providing Sildenafil Cream, 3.6% for the planned Phase 2b clinical study.

For further clinical development, we plan to utilize CMOs to produce and supply Sildenafil Cream, 3.6%.

As we advance our product candidates toward regulatory approval, we intend to identify, qualify and enter into long-term arrangements with CMOs for commercial production of each approved product.

We do not have established marketing, sales or distribution infrastructure or capabilities.

In order to commercialize any of our product candidates if approved for commercial sale, we must either establish a sales and marketing organization with technical expertise and supporting distribution capabilities or collaborate with third-parties that have sales and marketing experience.

Our approach is to develop an appropriate commercialization strategy for each of our product candidates based on the size of the market opportunity, the level of competition and the anticipated complexity of the launch.

As we move our product candidates through development toward, and in some cases, through regulatory approval, we evaluate several options for each product candidate's commercialization strategy.

These options include building our own sales force and other commercial infrastructure, entering into strategic marketing partnerships with third parties, including commercial sales organizations or other pharmaceutical or biotechnology companies, out-licensing the product to other pharmaceutical or biotechnology companies, and combinations of these strategies.

We have entered into an exclusive license agreement with Organon to out-license worldwide commercialization of XACIATO and an exclusive license agreement with Bayer to out-license U.S.

commercialization of Ovaprene.

Each of these licensees has established marketing, sales and distribution capabilities in women's health.

We expect to continue to evaluate each product opportunity and pursue the commercialization strategy that we believe will maximize the return on our assets in and outside of the U.S.

for our stockholders.

We have engaged third parties to assist in commercial planning and other commercial readiness activities for our product candidates and intend to continue to do so, as needed.

See “Strategic Agreements for Product Commercialization” below for a discussion of the terms of our out-license agreements.

Manufacturing and Supply

We do not own or operate, nor do we expect to own or operate, facilities for manufacturing, storage and distribution, or testing of our product or product candidates.

We rely on third parties to supply and manufacture our product candidates and other materials necessary to conduct pre-clinical testing, clinical trials and other activities required for regulatory approval of our product candidates, and expect to continue to do so in the future.

In addition, to the extent our commercialization strategy for a product requires that we undertake commercial supply obligations, we intend to rely on contract manufacturers and suppliers for manufacture, storage, distribution and testing of our finished commercial products and their respective components, including the active pharmaceutical ingredients, or API.

These arrangements require less upfront capital expenditure and allow us to maintain a smaller and more flexible infrastructure.

Under the terms of our license agreement with Organon, we will be responsible for providing product supply of XACIATO on an interim basis until Organon assumes such responsibility.

In March 2022, we entered into a long-term supply and manufacturing agreement with the contract manufacturing organization, or CMO, that provided clinical supplies of XACIATO for our pivotal Phase 3 DARE-BVFREE clinical study.

This CMO currently is our sole source for commercial supplies of XACIATO.

Under the terms of our agreement, the CMO is responsible for obtaining supplies, at our expense, of all the components necessary for the manufacture of XACIATO, including the API, clindamycin.

Our agreement contemplates potential assignment by us to a commercial collaborator.

We expect to have sufficient quantities of XACIATO finished product to support commercial launch in 2022.

Other than our agreement with ADVA-Tec, we have no long-term arrangements for the production or supply of our product candidates or the materials required to produce them.

We expect that our current arrangements will meet our foreseeable needs for clinical trial materials or, generally, that alternative supply sources will be readily available.

However, for some key raw materials or components of our clinical-stage product candidates, including Ovaprene and Sildenafil Cream, 3.6%, alternative supply sources may not be readily available.

"RISK FACTORS – Risks Related to our Business – Our success relies on third-party suppliers and manufacturers of our product candidates, including multiple single source suppliers and manufacturers," below.

License Agreements

However, we may experience manufacturing and supply delays and disruptions in connection with CMOs scaling up production to meet our clinical supply requirements for later stage clinical studies.

In addition, some key raw materials or components of our clinical-stage product candidates, including Ovaprene and Sildenafil Cream, 3.6%, have only a single source of supply and alternative supply sources may not be readily available.

Global supply chain disruptions related to the COVID-19 pandemic and recent geopolitical events may contribute to manufacturing and supply delays.

"RISK FACTORS – Risks Related to Product Research & Development and Regulatory Approval – Manufacturing and supply delays and disruptions may significantly delay our clinical studies and be expensive for us to resolve” below.

Strategic Agreements for Product Commercialization

Organon License Agreement

On March 31, 2022, we entered into an exclusive license agreement with Organon pursuant to which Organon will obtain exclusive worldwide rights to develop, manufacture and commercialize XACIATO and other future intravaginal or urological products for human use formulated with clindamycin that rely on intellectual property we control.

Under the agreement, we will receive a $10.0 million non-refundable and non-creditable payment following the effective date of the agreement and will be entitled to receive tiered double-digit royalties based on net sales and up to $182.5 million in milestone payments as follows:

$2.5 million following the first commercial sale of a licensed product in the United States, which is expected to occur during the fourth quarter of 2022;

and up to $180.0 million in tiered commercial sales milestones and regulatory milestones.

Royalty payments will be subject to customary reductions and offsets.

The royalty period for each licensed product will continue on a country-by-country basis from the first commercial sale of the licensed product in the country until the expiration of the later of (i) the date that no valid patent claim would be infringed in the absence of the license granted under the agreement by the sale of the licensed product in the country, (ii) 10 years after the end of the month in which the first commercial sale of the licensed product in the country occurred, and (iii) the expiration of regulatory market exclusivity for the licensed product in that country.

Under the agreement, we will be responsible for regulatory interactions and for providing product supply on an interim basis until Organon assumes such responsibilities.

Until such time, Organon will purchase all of its product requirements of XACIATO from us at a transfer price equal to our manufacturing costs plus a single-digit percentage markup.

The effective date of the agreement will occur following the satisfaction of closing conditions that include receipt of all applicable approvals, or the expiration or termination of all applicable waiting periods, required under applicable antitrust laws, including the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

Unless terminated earlier, the agreement will expire on a product-by-product and country-by-country basis upon expiration of the applicable royalty period for each licensed product.

In addition to customary termination rights for both parties, following the first anniversary of the effective date of the Agreement, Organon may terminate the Agreement in its entirety or on a country-by-country basis at any time in Organon’s sole discretion on 120 days’ advance written notice.

The agreement includes customary representations and warranties, covenants and indemnification obligations of each party.

In addition, the terms of the agreement provide Organon exclusive worldwide rights of first negotiation for specified potential future products of ours.

Bayer License Agreement

In January 2020, we entered into a license agreement with Bayer regarding the further development and commercialization of Ovaprene in the U.S.

We received a $1.0 million upfront non-refundable payment from Bayer and Bayer agreed to support us in development and regulatory activities by providing the equivalent of two experts to advise us in clinical, regulatory, preclinical, commercial, CMC and product supply matters.

Bayer, in its sole discretion, has the right to make the license effective by paying us an additional $20.0 million, referred to as the Clinical Trial and Manufacturing Activities Fee.

Such license would be exclusive with regard to the commercialization of Ovaprene for human contraception in the U.S.

and co-exclusive with us with regard to development.

The following is a summary of the other terms of the Bayer license agreement:

Milestone Payments Paid by Bayer.

We will be entitled to receive (a) a milestone payment in the low double-digit millions upon the first commercial sale of Ovaprene in the U.S.

and escalating milestone payments based on annual net sales of Ovaprene during a calendar year, totaling up to $310.0 million if all such milestones, including the first commercial sale, are achieved, (b) tiered royalties starting in the low double digits based on annual net sales of Ovaprene during a calendar year, subject to customary royalty reductions and offsets, and (c) a percentage of sublicense revenue .

We will be responsible for the pivotal trial for Ovaprene and for its development and regulatory activities and we have product supply obligations.

After payment of the Clinical Trial and Manufacturing Activities Fee, Bayer will be responsible for the commercialization of Ovaprene for human contraception in the U.S.

The initial term of the agreement, which is subject to automatic renewal terms, continues until the later of (a) the expiration of any valid claim covering the manufacture, use, sale or import of Ovaprene in the U.S.;

or (b) 15 years from the first commercial sale of Ovaprene in the U.S.

In addition to customary termination rights for both parties, Bayer may terminate the agreement at any time on 90 days’ notice and the agreement will automatically terminate if we do not receive the Clinical Trial and Manufacturing Activities Fee if and when due.

Strategic Agreements for Pipeline Development

Hammock/MilanaPharm Assignment and License Agreement

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The licensed intellectual property relates to the hydrogel drug delivery platform of TriLogic and MilanaPharm known as TRI-726.

In DARE-BV1, this proprietary technology is formulated with clindamycin for the treatment of bacterial vaginosis.

In XACIATO, this proprietary technology is formulated with clindamycin for the treatment of bacterial vaginosis.

In December 2019, we entered into amendments to each of the Assignment Agreement and License Amendment.

In September 2021, we entered into another amendment to the License Agreement.

The following is a summary of other terms of the License Amendment, as amended:

License Fees.

A total of $235,000 in license fees were payable, and were paid, to MilanaPharm:

(1) $25,000 in connection with the execution of the License Amendment;

(2) $100,000 in 2019;

and (3) $110,000 in 2020.

A total of $235,000 in license fees were payable to MilanaPharm, the final installment of which was $110,000 paid in 2020.

Milestone Payments.

We will pay to MilanaPharm:

(1) up to $300,000 in the aggregate upon achievement of certain clinical and regulatory development milestones, $50,000 of which was paid in 2020, and (2) up to $1.75 million in the aggregate upon achieving certain commercial sales milestones.

We paid MilanaPharm $300,000 in the aggregate upon achievement of certain clinical and regulatory development milestones, $50,000 of which was paid in 2020, and $250,000 of which was paid in 2021.

We may also pay MilanaPharm up to $1.75 million in the aggregate upon achieving certain commercial sales milestones.

Foreign Sublicense Income .

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Hammock assigned and transferred to us all of its right, title and interest in and to the MilanaPharm License Agreement and agreed to cooperate to transfer to us all of the data, materials and the licensed technology in its possession pursuant to a technology transfer plan to be agreed upon by the parties, with a goal for us to independently practice the licensed intellectual property as soon as commercially practical in order to develop and commercialize the licensed products and processes.

A total of $512,500 in fees were payable, and were paid, to Hammock:

(1) $250,000 in connection with the execution of the Assignment Agreement;

(2) $125,000 in 2019;

and (3) $137,500 in 2020.

A total of $512,500 in fees were payable to Hammock, the final installment of which was paid in 2020.

Milestone Payments .

We will pay Hammock up to $1.1 million in the aggregate upon achievement of certain clinical and regulatory development milestones.

We will pay Hammock up to $1.1 million in the aggregate upon achievement of certain clinical and regulatory development milestones, $100,000 of which was paid in 2020 and $750,000 of which was paid in 2021.

The remaining milestone does not relate to a bacterial vaginosis product.

The Assignment Agreement will terminate upon the later of (1) completion of the parties’ technology transfer plan, and (2) payment to Hammock of the last of the milestone payments.

ADVA-Tec License Agreement

In March 2017, we entered into a license agreement with ADVA-Tec, Inc., under which we were granted an exclusive license under ADVA-Tec’s intellectual property rights to develop and commercialize Ovaprene for human contraceptive use worldwide.

ADVA-Tec and its affiliates own issued patents or patent applications covering Ovaprene, and control proprietary trade secrets covering the manufacture of Ovaprene.

As of March 29, 2021, this patent portfolio includes nine issued U.S.

patents, one pending U.S.

patent applications, eight granted foreign patents, including four European patents, and seven pending foreign patent applications, all of which are exclusively licensed to us for all uses of Ovaprene as a human contraceptive device.

Under this license agreement, we have a right of first refusal to license these patents and patent applications for additional indications.

In March 2017, we entered into a license agreement with ADVA-Tec, Inc., under which we were granted an exclusive license to develop and commercialize Ovaprene for human contraceptive use worldwide.

We must use commercially reasonable efforts to develop and commercialize Ovaprene, and must meet certain minimum spending amounts per year, including $2.5 million per year to cover such activities until a final PMA is filed, or until the first commercial sale of Ovaprene, whichever occurs first.

ADVA-Tec will conduct certain research and development work as necessary to allow us to seek a PMA from the FDA and will provide us with clinical trial and commercial supplies of Ovaprene, either directly or through a CMO, on commercially reasonable terms.

Under the license agreement, in addition to an exclusive license to ADVA-Tec’s and its affiliates’ intellectual property rights for all uses of Ovaprene as a human contraceptive device, we have a right of first refusal to license these patents and patent applications for additional indications.

The following is a summary of other terms of the ADVA-Tec license agreement:

Research and Development.

ADVA-Tec will conduct certain research and development work as necessary to allow us to seek a PMA from the FDA and will provide us with clinical supplies of Ovaprene for clinical and commercial use on commercially reasonable terms.

We must use commercially reasonable efforts to develop and commercialize Ovaprene, and must meet certain minimum spending amounts per year, and $5 million in the aggregate over the first three years, to cover such activities until a final PMA is filed, or until the first commercial sale of Ovaprene, whichever occurs first.

Milestone and Royalty Payments.

Milestone Payments.

We will pay to ADVA-Tec:

(1) up to $14.6 million in the aggregate based on the achievement of specified development and regulatory milestones;

(1) up to $14.6 million in the aggregate based on the achievement of specified development and regulatory milestones, $200,000 of which was paid in 2021;

and (2) up to $20 million in the aggregate based on the achievement of certain worldwide net sales milestones.

The development and regulatory milestones include:

the completion of a successful postcoital clinical study;

The remaining development and regulatory milestones include:

the FDA’s approval to commence a pivotal clinical trial;

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and obtaining regulatory approval in Japan.

Because future milestone payments depend upon the successful progress of our product development programs, we cannot estimate with certainty when these payments will occur.

Royalty Payments.

After the commercial launch of Ovaprene, we will pay to ADVA-Tec royalties based on aggregate annual net sales of Ovaprene in specified regions at a royalty rate that will vary between 1% and 10% and will increase based on various net sales thresholds.

After the commercial launch of Ovaprene, we will pay ADVA-Tec royalties based on aggregate annual net sales of Ovaprene in specified regions at a royalty rate that will vary between 1% and 10% and will increase based on various net sales thresholds.

Unless earlier terminated, the license we received under the agreement continues on a country-by-country basis until the later of the life of the licensed patents or our last commercial sale of Ovaprene.

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(2) satisfy the annual spending obligation described above, (3) use commercially reasonable efforts to complete all necessary pre-clinical and clinical studies required to support and submit a PMA, (4) conduct clinical trials as set forth in the development plan to which we and ADVA-Tec agree, and as may be modified by a joint research committee, unless such failure is caused by events outside of our reasonable control, or (5) enroll a patient in the first non-significant risk medical device study or clinical trial as allowed by an institutional review board within six months of the production and release of Ovaprene, unless such failure is caused by events outside of the our reasonable control.

Bayer HealthCare LLC License Agreement

In January 2020, we entered into a license agreement with Bayer regarding the further development and commercialization of Ovaprene in the U.S.

We received a $1.0 million upfront payment from Bayer and Bayer agreed to support us in development and regulatory activities by providing the equivalent of two experts to advise us in clinical, regulatory, preclinical, commercial, CMC and product supply matters.

Bayer, in its sole discretion, has the right to make the license effective by paying us an additional $20.0 million, referred to as the Clinical Trial and Manufacturing Activities Fee.

Such license would be exclusive with regard to the commercialization of Ovaprene for human contraception in the U.S.

and co-exclusive with us with regard to development.

The following is a summary of the other terms of the Bayer license agreement:

Milestone Payments Paid by Bayer.

We will be entitled to receive (a) a milestone payment in the low double-digit millions upon the first commercial sale of Ovaprene in the U.S.

We will be responsible for the pivotal trial for Ovaprene and for its development and regulatory activities and we have product supply obligations.

After payment of the Clinical Trial and Manufacturing Activities Fee, Bayer will be responsible for the commercialization of Ovaprene for human contraception in the U.S.

or (b) 15 years from the first commercial sale of Ovaprene in the U.S.

Cooperative Research and Development Agreement with NICHD

In July 2021, we entered into a CRADA with the U.S.

Department of Health and Human Services, as represented by NICHD, part of the National Institutes of Health, or NIH, for the conduct of a pivotal Phase 3 clinical study of Ovaprene.

See also “Our Pipeline:

Clinical Stage Programs – Ovaprene” above.

Pursuant to the terms of the CRADA, we are responsible for providing a total of $5.5 million in four payments to NICHD to be applied toward the costs of conducting the Phase 3 study, a total of $1.5 million of which we paid in two installments 2021 and $3.5 million of which we paid in the first quarter of 2022 in accordance with the payment schedule under the CRADA.

The final payment, due in the second quarter of 2023, is $500,000.

NICHD will be responsible for the other costs related to the conduct of the Phase 3 study and will manage the payment of expenses to other parties involved with the study.

Either we or NICHD may terminate the CRADA for any reason upon 30 days’ prior written notice to the other party.

If the CRADA is terminated before completion of the Phase 3 study, NICHD will cooperate with us to transfer the data and the conduct of the study to us or our designee and will continue to conduct the study for so long as necessary to enable such transfer to be completed without interrupting the study.

If we terminate the CRADA before the completion of any active study protocol, we generally will be responsible for providing sufficient clinical supplies of Ovaprene to NICHD in order to complete the study.

NICHD may retain and use payments we make under the CRADA for up to one year after expiration or termination to cover costs associated with the conduct of activities described under the research plan in the CRADA that were initiated prior to expiration or termination, and any unused funds will be returned to us.

Under the CRADA, each party granted the other party rights to use their respective background inventions solely to the extent necessary to conduct the activities described in the research plan in the CRADA.

Subject to the U.S.

government’s nonexclusive, nontransferable, irrevocable, paid-up right to practice any CRADA invention for research or other government purposes, each party will own inventions, data and materials produced by its employees, and both parties will jointly own inventions jointly invented by their employees in performing the research plan.

Under the CRADA, we were granted an exclusive option to negotiate an exclusive or nonexclusive development and commercialization license with a field of use that does not exceed the scope of the research plan to rights that the U.S.

government may have in inventions jointly or independently invented by NICHD employees for which a patent application is filed.

The CRADA also contains customary representations, warranties, and indemnification and confidentiality obligations.

The CRADA expires five years from its effective date.

SST License and Collaboration Agreement

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Milestone Payments.

We must make potential future development and sales milestone payments of (1) up to $13.5 million in the aggregate upon achieving certain clinical and regulatory milestones, and (2) up to $30.3 million in the aggregate upon achieving certain commercial sales milestones for each product or process covered by the licenses granted under the agreement.

We must make potential future development and sales milestone payments of (1) up to $13.5 million in the aggregate upon achieving certain clinical and regulatory milestones, $1.0 million of which became payable in the third quarter of 2021, and in accordance with the license agreement, the amount was offset by the $100,000 annual maintenance fee, resulting in a net amount of $900,000 paid during the third quarter of 2021, and (2) up to $30.3 million in the aggregate upon achieving certain commercial sales milestones for each product or process covered by the licenses granted under the agreement.

Royalty Payments .

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Upon expiration (but not early termination) of the agreement, the licenses granted thereunder will convert automatically to fully-paid irrevocable licenses.

Catalent may terminate the agreement (1) upon 30 days’ notice for our uncured breach of any payment obligation under the agreement, (2) if we fail to maintain required insurance, (3) immediately upon our insolvency or the making of an assignment for the benefit of our creditors or if a bankruptcy petition is filed for or against us, which petition is not dismissed within 90 days, or (4) upon 60 days’ notice for any uncured material breach by us of any of our other

obligations under the agreement.

We may terminate the agreement on a country-by-country basis for any reason by giving 180 days’ notice (or 90 days’ notice if such termination occurs prior to receipt of marketing approval in the United States).

If Catalent terminates the agreement for the reason described in clause (4) above or if we terminate the agreement, Catalent will have full access including the right to use and reference all product data generated during the term of the agreement that is owned by us.

Microchips Acquisition

In November 2019, we acquired Microchips Biotech, Inc., or Microchips, via a merger transaction in which a wholly owned subsidiary we formed for purposes of this transaction merged with and into Microchips , and Microchips survived as our wholly owned subsidiary.

Microchips is developing a proprietary, implantable drug delivery system designed to store and precisely deliver numerous therapeutic doses over months and years on a schedule determined by the user and controlled via wireless remote.

Microchips’ lead product candidate is a pre-clinical stage contraceptive application of the technology that utilizes levonorgestrel, now known as DARE-LARC1.

At the closing of the merger, we issued an aggregate of approximately 3.0 million shares of our common stock to the holders of shares of Microchips’ capital stock outstanding immediately prior to the effective time of the merger.

Such shares were in consideration of Microchips' cash and cash equivalents, less liabilities, at closing.

Microchips' cash and cash equivalents at closing were approximately $5.9 million after taking into account payment of transaction-related expenses.

We agreed to pay the following contingent consideration to the former Microchips stockholders:

Pear Tree Acquisition

In May 2018, we completed our acquisition of Pear Tree Pharmaceuticals, Inc., or Pear Tree.

We acquired Pear Tree to secure the rights to develop a proprietary vaginal formulation of tamoxifen, now known as DARE-VVA1, as a potential treatment for vulvar and vaginal atrophy.

Milestone Payments .

Contingent payments to the Pear Tree former stockholders or their representatives that become payable upon achievement of specified clinical, regulatory and commercial milestones, may be paid, in our sole discretion, in cash or shares of our common stock.

Royalty Payments .

The former stockholders of Pear Tree will be eligible to receive, subject to certain offsets, tiered royalties, including customary provisions permitting royalty reductions and offset, based on percentages of annual net sales of certain products subject to license agreements we assumed and a percentage of sublicense revenue.

MBI Acquisition

In November 2019, we acquired Dare MB Inc.

(formerly, Microchips Biotech, Inc.), or MBI, to secure the rights to develop a long-acting reversible contraception method that a woman can turn on or off herself, according to her own needs.

This candidate is now known as DARE-LARC1.

At the closing of the merger, we issued an aggregate of approximately 3.0 million shares of our common stock to the holders of shares of MBI’s capital stock outstanding immediately prior to the effective time of the merger.

The transaction was valued at $2.4 million, based on the fair value of the approximately 3.0 million shares issued at $0.79 per share, which was the closing price per share of our common stock on the date of closing.

The shares were issued in consideration of MBI's cash and cash equivalents of $6.1 million, less net liabilities of $3.5 million and transaction costs of $202,000, which was allocated based on the relative fair value of the assets acquired and liabilities assumed.

We agreed to pay the following additional consideration to the former MBI stockholders:

(a) up to $46.5 million contingent upon the achievement of specified funding, product development and regulatory milestones;

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and (d) a percentage of sublicense revenue related to such products.

We agreed to use commercially reasonable efforts to achieve specified development and regulatory objectives relating to the implantable contraceptive product in development by Microchips.

We recorded $1.0 million in contingent consideration associated with the milestone payments that we expect to become payable in the first half of 2021, and if and when they become due and payable, we may make such milestone payments in cash, shares of our common stock or some combination of both.

The shares of our common stock issued at the closing of the Microchips merger are being held, and any contingent consideration that becomes payable during the 18-month period following the closing will be held, in escrow for a period of 18 months post-closing to satisfy the indemnification obligations, if any, of the former Microchips stockholders under the merger agreement.

That 18-month period will expire in May 2021.

We agreed to register the shares of our common stock issued at the closing as well as any shares issuable after the closing as contingent consideration to the former Microchips stockholders for resale under the Securities Act of 1933, as amended, or the Securities Act.

A registration statement on Form S-3 registering the possible resale from time to time of up to approximately 5.0 million shares of our common stock by the former Microchips stockholders, including the shares we issued at the closing of the merger, became effective on June 8, 2020.

We agreed to use commercially reasonable efforts to achieve specified development and regulatory objectives relating to DARE-LARC1.

In June 2021, a total of $1.25 million of that potential additional consideration became payable upon the achievement of certain of the funding and product development milestone events, $1.0 million of which was recorded as contingent consideration on our consolidated balance sheets upon the completion of the MBI acquisition and $250,000 of which was expensed in 2021.

In July 2021, our board of directors elected to make these milestone payments in shares of our common stock, to the extent permissible under the terms of the merger agreement with MBI, and, in September 2021, we issued approximately 700,000 shares of our common stock to former stockholders of MBI and paid $75,000 in cash to the stockholders' representative in accordance with the terms of the merger agreement in satisfaction of the $1.25 million in milestone payments associated with milestones achieved in June 2021.

Adare Development and Option Agreement

In March 2018, we entered into an exclusive development and option agreement with Adare Pharmaceuticals (formerly known as Orbis Biosciences, and which we refer to as Adare), for the development of long-acting injectable etonogestrel contraceptive with 6- and 12-month durations (now known as ADARE-204 and ADARE-214, respectively).

The agreement provides us with an option to negotiate an exclusive license agreement for the programs if we fund the conduct of specified development work by Adare.

Intellectual Property

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Even if we, or our licensors were to prevail in any such action, any litigation could be costly and time-consuming and would divert the attention of management and key personnel from our business operations.

Also, if our product candidates or any future products are found to infringe the patents of others, our development, manufacture, and sale of these

potential products could be severely restricted or prohibited.

Also, if our product candidates or any future products are found to infringe the patents of others, our development, manufacture, and sale of these potential products could be severely restricted or prohibited.

In addition, there can be no assurance that any patent applications filed by us or our licensors will result in the grant of a patent either in the United States or elsewhere, or that any patents granted will be valid and enforceable, or that any patents will provide a competitive advantage or afford protection against competitors with similar technologies.

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Under the terms of the Assignment Agreement with Hammock Pharmaceuticals, Inc.

and the License Amendment with TriLogic Pharma, LLC and MilanaPharm, LLC, regarding the thermosetting hydrogel platform which includes DARE-BV1, we are the exclusive licensee of two issued U.S.

patents set to expire in December 2028, subject to any extensions or disclaimers, and two foreign patents, including one European Patent Office, or EPO, patent validated in four countries, that expire in December 2028, subject to any extensions or disclaimers.

In addition, we have rights to three pending foreign patent applications and one pending U.S patent application.

If issued the patent term for these patents would be expected to expire in 2036, subject to any extensions or disclaimers.

and the License Amendment with TriLogic Pharma, LLC and MilanaPharm, LLC, regarding the thermosetting hydrogel platform which includes XACIATO, we are the exclusive licensee of three issued U.S.

patents, two of which are set to expire in December 2028 and one of which is set to expire in September 2036, subject to any extensions or disclaimers, and three foreign patents, including one European Patent Office, or EPO, patent validated in four countries, that expire in December 2028, subject to any extensions or disclaimers.

One of the three issued U.S.

patents is listed in the FDA’s compendium of “Approved Drug Products with Therapeutic Equivalence Evaluation," known as the Orange Book, under the Patent Exclusivity Information for XACIATO.

In addition, we have rights to three pending foreign patent applications and one pending U.S.

patent application.

If issued, the patent term for these patents issuing from these pending applications would be expected to expire in 2036, subject to any extensions or disclaimers.

Under the terms of the ADVA-Tec license agreement, regarding Ovaprene, we are the exclusive licensee of nine granted U.S.

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Two of the patents that are particularly important to the protection of Ovaprene have terms until August 2028, which includes days added to the term by patent term adjustment, and a third patent has a term that expires in July 2027, including patent term adjustment, each of such terms being subject to any future extensions or disclaimers.

Under the terms of the SST license agreement, regarding Sidenafil Cream, 3.6%, we are the exclusive licensee in the Field of Use of 19 issued patents worldwide (nine U.S.

Under the terms of the SST license agreement, regarding Sildenafil Cream, 3.6%, we are the exclusive licensee in the Field of Use of 22 issued patents worldwide (nine U.S.

patents and 13 foreign patents, including two EPO patents validated in a total of 24 countries).

Additionally, there is one patent application pending in the US, one in Europe, and three in other international markets.

Additionally, there is one patent application pending in the US, one in Europe, and two in other international markets.

The issued U.S.

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When we acquired Pear Tree Pharmaceuticals, Inc.

in April 2018, regarding DARE-VVA1, we obtained the rights to three U.S.

in 2018, regarding DARE-VVA1, we obtained the rights to three U.S.

patents and one Japanese patent.

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The Japanese patent has a term that is set to expire in June 2027.

When we acquired Microchips Biotech, Inc.

in November 2019, we obtained the rights to over 100 patents and applications.

When we acquired MBI in 2019, we obtained the rights to over 100 patents and applications.

The key technology underlying the platform is supported by 16 U.S.

patents and 42 foreign patents, including six EPO patents validated in various European countries, and 16 pending patent applications, including three U.S.

applications and 13 international applications.

We believe that the three most recently granted patent families are most directly applicable to our DARE-LARC1 program.

patents and 45 foreign patents, including six EPO patents validated in various European countries, and six pending patent applications, including two U.S.

applications and one Patent Cooperation Treaty (PCT) international application.

We believe that three of the most recently granted patent families are most directly applicable to our DARE-LARC1 program.

Those patent families have patent terms that are set to expire 2032, 2033, and 2034 respectively, subject to any extensions or disclaimers.

These patent families include patents granted in the U.S., E.U.

Those patent families include patents granted in the U.S., E.U.

and other key international markets.

One pending patent application related to DARE-LARC1, if granted, would have a patent term that would be expected to expire in 2040, subject to any extensions or disclaimers.

One pending U.S.

patent application, which has a pending PCT international counterpart, related to DARE-LARC1, if granted, would have a patent term that would be expected to expire in 2040, subject to any extensions or disclaimers.

We also rely upon trade secret rights to protect our product candidates as well as other technologies that may be used to discover, validate and commercialize our current or any future product candidates.

We presently seek protection, in part, through confidentiality and proprietary information agreements.

We hold a domestic registration for the trademark Daré Bioscience.

We hold a domestic registration for the trademark Daré Bioscience and our registration for the XACIATO trademark in the U.S.

In accordance with the terms of the ADVA-Tec license agreement, we are the exclusive licensee of the Ovaprene registered trademark.

Pre-Clinical Programs

In addition to our clinical-stage product candidates, we have licenses or other rights to the following pre-clinical stage product candidates in women’s health that meet our selection criteria of technology or product candidates with potential to expand options, improve outcomes, and facilitate convenience for women:

• DARE-LARC1 , a combination product designed to provide long-acting, reversible contraception comprising an implantable, user-controlled wireless drug delivery system and levonorgestrel;

• ORB-204 and ORB-214 , injectable formulations of etonogestrel designed to provide contraception over 6-month and 12-month periods, respectively;

• DARE-RH1 , a novel approach to non-hormonal contraception for both men and women by targeting the CatSper ion channel.

The industries in which we operate (biopharmaceutical, specialty pharmaceutical, biotechnology and medical device) are highly competitive and subject to rapid and significant change.

We may not compete successfully against organizations with competitive products, particularly large pharmaceutical companies.

Our success is highly dependent upon our

ability to acquire or in-license, develop and obtain regulatory approval for innovative medical products on a cost-effective basis and to market them successfully, either on our own or together with strategic partners.

We face and will continue to face intense competition from a variety of businesses, including large, fully integrated, well-established pharmaceutical companies that already possess a significant share of the women’s health market.

Many of our potential competitors have greater clinical, regulatory, manufacturing, marketing, distribution, compliance and financial resources and experience than we do.

"RISK FACTORS—Risks Related to our Business— The product candidates we are developing or may develop are likely to face significant competition and our business and operating results will suffer if we fail to compete effectively ,” below.

We expect that, if approved, DARE-BV1 will compete directly with the multiple generic and branded prescription drug products currently approved in the U.S.

"RISK FACTORS—Risks Related to Commercialization of XACIATO and Our Product Candidates— Our product candidates, if approved, and XACIATO will face intense competition and our business and operating results will suffer if we, or our commercial collaborators, fail to compete effectively” and “— The women's health market includes many generic products and growth in generics is expected to continue, which could make the successful introduction of our branded products difficult and expensive” below.

XACIATO will compete directly with the multiple generic and branded prescription drug products currently approved in the U.S.

for the treatment of bacterial vaginosis, including oral and vaginal gel formulations of metronidazole and vaginal cream formulations of clindamycin.

Branded, single-dose FDA-approved products for bacterial vaginosis include Solosec® (secnidazole) oral granules manufactured for and distributed by Lupin Pharmaceuticals, Inc., Clindesse® (clindamycin phosphate) vaginal cream, 2% manufactured and distributed by Perrigo, and Nuvessa™ (metronidazole vaginal gel 1.3%) distributed by Exeltis USA, Inc.

Branded, single-dose FDA-approved products for bacterial vaginosis include Solosec® (secnidazole) oral granules manufactured for and distributed by Lupin Pharmaceuticals, Inc., Clindesse® (clindamycin phosphate) vaginal cream, 2% manufactured and distributed by Padagis, and Nuvessa™ (metronidazole vaginal gel 1.3%) distributed by Exeltis USA, Inc.

Based on the XACIATO product profile reflected in the FDA-approved prescribing information, including the consistent cure rates demonstrated among the subsets of patients defined by prior episodes of bacterial vaginosis (≤ 3 and >3 episodes in the previous 12 months), and the labeling for special populations such as pregnant and lactating women, we expect that the product may to be used by health care providers as a first line option for treating bacterial vaginosis.

Our investigational contraceptive products, including Ovaprene, if approved, will compete with a wide range of prescription and over-the-counter contraceptive options, including hormone-free options such as condoms, diaphragms, cervical caps, sponges, copper IUDs, spermicides and vaginal gels, as well as hormonal products such as pills, patches, vaginal rings and injectables.

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The process of obtaining regulatory approvals in the U.S.

foreign countries and jurisdictions, and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations, require the expenditure of substantial time and financial resources.

and in foreign countries and jurisdictions, and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations, require the expenditure of substantial time and financial resources.

We and our third-party manufacturers, distributors and contract research organizations, or CROs, may also be subject to government regulation under other federal, state, and local laws, including the U.S.

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• submission of a NDA to the FDA along with payment of the application user fee and FDA acceptance of that NDA;

• satisfactory completion of an FDA pre-approval inspection of the manufacturing facilities at which the active pharmaceutical ingredient, or API, and finished drug product are produced and tested to assess readiness for commercial manufacturing and conformance to the manufacturing-related elements of the application, to conduct a data integrity audit, and to assess compliance with current good manufacturing practices, or cGMPs, in order to assure that the facilities, methods and controls are adequate to preserve the drug candidate’s identity, strength, quality and purity;

• satisfactory completion of an FDA pre-approval inspection of the manufacturing facilities at which the active pharmaceutical ingredient, or API, and finished drug product are produced and tested to assess readiness for commercial manufacturing and conformance to the manufacturing-related elements of the application, to conduct a data integrity audit, and to assess compliance with current good manufacturing practices, or cGMP, in order to assure that the facilities, methods and controls are adequate to preserve the drug candidate’s identity, strength, quality and purity;

• possible inspection of selected clinical study sites to confirm compliance with GCP requirements and data integrity;

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Preclinical tests intended for submission to the FDA to support the safety of a product candidate must be conducted in compliance with GLP regulations and the United States Department of Agriculture’s Animal Welfare Act, if applicable.

A drug sponsor must submit the results of the preclinical tests, together with manufacturing information, analytical data and any available clinical data or literature, among other things, to the FDA as part of an IND.

A drug sponsor must submit the results of the preclinical

tests, together with manufacturing information, analytical data and any available clinical data or literature, among other things, to the FDA as part of an IND.

Some nonclinical testing may continue after the IND is submitted.

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Clinical trials must be conducted under the supervision of one or more qualified investigators in accordance with the FDA’s GCP requirements.

They must be conducted under protocols detailing the objectives of the trial, dosing procedures, research subject selection and exclusion criteria and the safety and effectiveness criteria to be

They must be conducted under protocols detailing the objectives of the trial, dosing procedures, research subject selection and exclusion criteria and the safety and effectiveness criteria to be evaluated.

Each protocol, and any subsequent material amendment to the protocol, must be submitted to the FDA as part of the IND, and progress reports detailing the status of the clinical trials must be submitted to the FDA annually.

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An institutional review board, or IRB, is responsible for ensuring that human subjects in clinical studies are protected from inappropriate study risks.

An IRB at each institution participating in the clinical trial must review and approve the protocol before a clinical trial commences at that institution and must also approve the information regarding the trial and the consent form that must be provided to each research subject or the subject’s legal representative, monitor the trial until completed and otherwise comply with IRB regulations.

trial until completed and otherwise comply with IRB regulations.

The IRB also may halt a study, either temporarily or permanently, for failure to comply with GCP or the IRB’s requirements, or if the investigational new drug has been associated with unexpected serious harm to patients.

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Under the goals and policies agreed to by the FDA under PDUFA, the FDA has ten months from receipt in which to complete its initial review of a standard NDA for a drug that is not a new molecular entity, and six months from the receipt date for an application with priority review.

The FDA does not always meet its PDUFA goal dates, and the review process is often significantly extended by FDA requests for additional information or clarification and a sponsor’s process to respond to such inquiries.

The FDA does not always meet its PDUFA goal dates, and the review process is often significantly extended by FDA requests for additional information or clarification and the sponsor’s process to respond to such inquiries.

As a result, the NDA review process can be very lengthy.

passage of the Drug Price Competition and Patent Term Restoration Act, informally known as the Hatch-Waxman Act, that established an abbreviated regulatory scheme authorizing the FDA to approve generic drugs based on an innovator or “reference” product, Congress also enacted Section 505(b)(2) of the FDCA, which provides a hybrid pathway combining features of a traditional NDA and a generic drug application.

Most innovative drug products (other than biological products) obtain FDA marketing approval pursuant to an NDA submitted under Section 505(b)(1) of the FDCA, commonly referred to as a traditional or "full NDA." In 1984, with passage of the Drug Price Competition and Patent Term Restoration Act, informally known as the Hatch-Waxman Act, that established an abbreviated regulatory scheme authorizing the FDA to approve generic drugs based on an innovator or “reference” product, Congress also enacted Section 505(b)(2) of the FDCA, which provides a hybrid pathway combining features of a traditional NDA and a generic drug application.

Section 505(b)(2) enables the applicant to rely, in part, on the FDA’s prior findings of safety and efficacy data for an existing product, or published literature, in support of its application.

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A Section 505(b)(2) applicant may eliminate or reduce the need to conduct certain pre-clinical or clinical studies, if it can establish that reliance on studies conducted for a previously-approved product is scientifically appropriate.

The FDA may also require companies to perform additional studies or measurements, including nonclinical and clinical studies, to support the change from the approved product.

The FDA may also require companies to perform additional studies or measurements, including nonclinical and clinical studies,

to support the change from the approved product.

The FDA may then approve the new product candidate for all or some of the labeled indications for which the referenced product has been approved, as well as for any new indication for which the Section 505(b)(2) NDA applicant has submitted data.

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An approval letter authorizes commercial marketing of the drug product with specific prescribing information for specific indications.

CRL indicates that the review cycle of the application is complete and the application will not be approved in its present form.

A CRL indicates that the review cycle of the application is complete and the application will not be approved in its present form.

The deficiencies identified may be minor, for example, requiring labeling changes, or major, for example, requiring additional clinical trials.

Additionally, the complete response letter may include recommended actions that the applicant might take to place the application in a condition for approval.

Additionally, the CRL may include recommended actions that the applicant might take to place the application in a condition for approval.

If a CRL is issued, the applicant may either resubmit the NDA, addressing all of the deficiencies identified in the letter, or withdraw the application.

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The FDA may impose restrictions and conditions on product distribution, prescribing, or dispensing in the form of a REMS plan, or otherwise limit the scope of any approval.

In addition, the FDA may require post marketing clinical trials, sometimes referred to as “Phase 4” clinical trials, designed to further assess a product’s safety and effectiveness, and/or testing and surveillance programs to monitor the safety of approved products that have been commercialized.

have been commercialized.

After approval, some types of changes to the approved product, such as adding new indications, manufacturing changes and additional labeling claims, are subject to further testing requirements and FDA review and approval.

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In addition, fast track designation may be withdrawn by the sponsor or rescinded by the FDA if the designation is no longer supported by data emerging in the clinical trial process.

FDASIA also included the Generating Antibiotics Incentives Now Act, or the GAIN Act, which directed FDA to implement QIDP designation program.

The Food and Drug Administration Safety and Innovation Act of 2012, or FDASIA, included the Generating Antibiotics Incentives Now Act, or the GAIN Act, which directed FDA to implement QIDP designation program.

The GAIN Act created incentives for the development of antibacterial and antifungal drug products for the treatment of serious or life-threatening infections.

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The FDA determines at the time that the marketing application is submitted, on a case-by-case basis, whether the proposed drug represents a significant improvement in treatment, prevention or diagnosis of disease when compared with other available therapies.

Significant improvement may be illustrated by evidence of increased effectiveness in the treatment of a condition,

elimination or substantial reduction of a treatment-limiting drug reaction, documented enhancement of patient compliance that may lead to improvement in serious outcomes, or evidence of safety and effectiveness in a new subpopulation.

Significant improvement may be illustrated by evidence of increased effectiveness in the treatment of a condition, elimination or substantial reduction of a treatment-limiting drug reaction, documented enhancement of patient compliance that may lead to improvement in serious outcomes, or evidence of safety and effectiveness in a new subpopulation.

A priority review designation is intended to direct overall attention and resources to the evaluation of such applications, and to shorten the FDA’s goal for taking action on a marketing application from ten months to six months.

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There also are continuing, annual user fee requirements for that are now assessed as program fees for certain NDA-approved drugs.

The most recent, 2017 reauthorization of PDUFA restructured the prescription drug user fee program to eliminate the previously collected establishment and supplemental application fees.

In addition, FDA regulations require that products be manufactured in specific approved facilities and in accordance with cGMPs.

In addition, FDA regulations require that products be manufactured in specific approved facilities and in accordance with cGMP.

The cGMP regulations include requirements relating to organization of personnel, buildings and facilities, equipment, control of components and drug product containers and closures, production and process controls, packaging and labeling controls, holding and distribution, laboratory controls, records and reports and returned or salvaged products.

Drug manufacturers and other entities involved in the manufacture and distribution of approved drugs are required to register their establishments with the FDA and some state agencies, and are subject to periodic unannounced inspections by the FDA for compliance with cGMPs and other requirements.

Changes to the manufacturing process, specifications or container closure system for an approved drug product are strictly regulated and often require prior FDA approval before being implemented.

FDA regulations also require, among other things, the investigation and correction of any deviations from cGMP and the imposition of reporting and documentation requirements upon the NDA sponsor and any third-party manufacturers involved in producing the approved drug product.

Accordingly, both sponsors and manufacturers must continue to expend time, money, and effort in the area of production and quality control to maintain cGMP compliance and other aspects of quality control and quality assurance, and to ensure ongoing compliance with other statutory requirements the FDCA, such as the requirements for making manufacturing changes to an approved NDA.

Accordingly, both sponsors and manufacturers must continue to expend time, money, and effort in the area of production and quality control to maintain cGMP compliance and other aspects of quality control and quality assurance, and to ensure ongoing compliance with other statutory requirements of the FDCA, such as the requirements for making manufacturing changes to an approved NDA.

Accordingly, even after a new drug approval is granted, the FDA may withdraw the approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market.

Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information;

imposition of post-market studies or clinical trials

to assess new safety risks;

imposition of post-market studies or clinical trials to assess new safety risks;

or the imposition of distribution or other restrictions under a REMS plan.

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The Prescription Drug Marketing Act of 1987, or PDMA, was the first federal law to set minimum standards for the registration and regulation of drug distributors by the states and to regulate the distribution of drug samples.

Today, both the PDMA and state laws limit the distribution of prescription pharmaceutical product samples and impose requirements to ensure accountability in distribution.

Today, both the PDMA and state laws limit the distribution of prescription pharmaceutical product samples and impose

requirements to ensure accountability in distribution.

Congress more recently enacted the Drug Supply Chain Security Act, or DSCSA, which made significant amendments to the FDCA, including by replacing certain provisions from the PDMA pertaining to wholesale distribution of prescription drugs with a more comprehensive statutory scheme.

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If not, it is generally a medical device.

Unless an exemption applies, a new medical device may not be marketed in the United States unless and until it has been cleared through the premarket notification, or 510(k), process, or approved by the FDA pursuant to a premarket approval application, or PMA.

The information that must be submitted to the FDA in order to obtain clearance or approval to market a new medical device varies depending on how the medical device is classified by the FDA.

As medical devices have become increasingly connected to the Internet, hospital networks, and other medical devices to provide features that improve health care and patient accessibility, FDA and other regulatory authorities have recognized that those same features also increase the risk of potential cybersecurity threats.

As electronic and digital medical devices have become increasingly connected to the Internet, hospital networks, and other medical devices to provide features that improve health care and patient accessibility, FDA and other regulatory authorities have recognized that those same features also increase the risk of potential cybersecurity threats.

These types of medical devices may be vulnerable to security breaches, potentially impacting the safety and effectiveness of the device, and accordingly device manufacturers are responsible for identifying cybersecurity risks and hazards associated with their products.

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the agency also monitors reports of cybersecurity risks as part of its post-marketing device surveillance activities.

Medical devices are classified into one of three classes on the basis of the controls deemed by the FDA to be necessary to reasonably ensure their safety and effectiveness.

Class I devices are those low risk devices for

which reasonable assurance of safety and effectiveness can be provided by adherence to the FDA’s general controls for medical devices, which include applicable portions of the FDA’s Quality System Regulation, or QSR;

Medical devices are classified into one of three classes on the basis of the controls deemed by the FDA to be necessary to reasonably assure their safety and effectiveness.

Class I devices are those low risk devices for which reasonable assurance of safety and effectiveness can be provided by adherence to the FDA’s general controls for medical devices, which include applicable portions of the FDA’s Quality System Regulation, or QSR;

facility registration and product listing;

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The device to which the sponsor’s device is compared for the purpose of determining substantial equivalence is called a “predicate device.” The FDA’s goal is to make a substantial equivalence determination within 90 days of FDA’s receipt of the 510(k) application, but it often takes longer if the FDA requests additional information.

Most 510(k)s do not require supporting data from clinical trials, but the FDA may request such data.

Most 510(k)s do not require supporting data from clinical trials, but such data is typically required if the predicate device relied in part on clinical trial data to obtain clearance.

After a device receives 510(k) clearance, any modification that could significantly affect its safety or effectiveness, or that would constitute a major change in its intended use, will require a new clearance or possibly a pre-market approval.

Premarket notifications are subject to user fees, unless a specific exemption applies.

Class III devices are deemed by the FDA to pose the greatest risk to patients, such as those for which reasonable assurance of the device’s safety and effectiveness cannot be assured solely by the general controls and special controls described above and that are life-sustaining or life-supporting.

Class III devices are deemed by the FDA to pose the greatest risk to patients, such as life-sustaining or life-supporting devices, devices that present a potential unreasonable risk of illness or injury, or, more generally, devices whose safety and effectiveness cannot be assured solely by the general controls and special controls described above.

All Class III devices must be reviewed and approved by the FDA through the PMA process.

A PMA must be supported by extensive data including, but not limited to, technical, preclinical, clinical trials, manufacturing and labeling to demonstrate to the FDA’s satisfaction the safety and effectiveness of the device for its intended use.

After a PMA is sufficiently complete, the FDA will accept the application for filing and begin an in‑depth review of the submitted information.

A PMA must be supported by extensive data including, but not limited to, technical data, nonclinical studies, clinical trials, manufacturing and labeling to demonstrate to the FDA’s satisfaction the safety and effectiveness of the device for its intended use.

After a PMA is submitted and the FDA determines the application is sufficiently complete, the agency will accept it for filing and begin an in-depth review of the submitted information.

By statute, the FDA has 180 days to review the accepted application, although review of the application generally can take between one and three years.

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In addition, the FDA will conduct a preapproval inspection of the manufacturing facility to ensure compliance with the QSR.

New premarket approval applications or premarket approval application supplements are also required for product modifications that affect the safety and efficacy of the device.

New PMA applications or supplements are also required for product modifications that affect the safety and efficacy of the device.

PMA (and supplemental PMAs) are subject to significantly higher user fees than are 510(k) premarket notifications.

Medical device types that the FDA has not previously classified as Class I, II or III are automatically classified into Class III regardless of the level of risk they ultimately pose to patients and/or users.

Novel medical device types that the FDA has not previously classified as Class I, II or III are automatically classified into Class III regardless of the level of risk they ultimately pose to patients and/or users.

The Food and Drug Administration Modernization Act of 1997 established a new route to market for low to moderate risk medical devices that are automatically placed into Class III due to the absence of a predicate device, called the “Request for Evaluation of Automatic Class III Designation,” or the De Novo classification procedure.

This procedure allows a manufacturer whose novel device is automatically classified into Class III to request down-classification of its medical device into Class I or Class II based on a benefit-risk analysis demonstrating the device actually presents low or moderate risk, rather than requiring the submission and approval of a PMA application.

Prior to the enactment of the Food and Drug Administration Safety and Innovation Act of 2012, or FDASIA, a medical device could only be eligible for de novo classification if the manufacturer first submitted a 510(k) premarket notification and received a determination from the FDA that the device was not substantially equivalent.

Prior to the enactment of FDASIA, a medical device could only be eligible for De Novo classification if the manufacturer first submitted a 510(k) premarket notification and received a determination from the FDA that the device was not substantially equivalent.

FDASIA streamlined the De Novo classification pathway by permitting manufacturers to request De Novo classification directly without first submitting a 510(k) premarket notification to the FDA and receiving a not substantially equivalent determination.

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If the manufacturer seeks reclassification into Class II, the manufacturer must include a draft proposal for special controls that are necessary to provide a reasonable assurance of the safety and effectiveness of the medical device.

In addition, the FDA may reject the reclassification petition if it identifies a legally marketed predicate device

that would be appropriate for a 510(k) or determines that the device is not low to moderate risk or that general controls would be inadequate to control the risks and special controls cannot be developed.

De novo reclassification requests are also subject to user fees, unless a specific exemption applies.

Clinical trials are almost always required to support a PMA application and are sometimes required for a de novo classification request or 510(k) pre-market notification.

In addition, the FDA may reject the reclassification petition if it identifies a legally marketed predicate device that would be appropriate for a 510(k) or determines that the device is not low to moderate risk or that general controls would be inadequate to control the risks and special controls cannot be developed.

De Novo classification requests are also subject to user fees, unless a specific exemption applies.

Clinical trials are almost always required to support a PMA application and are sometimes required for a De Novo classification request or 510(k) premarket notification.

In order to conduct a clinical investigation involving human subjects for the purpose of demonstrating the safety and effectiveness of a medical device, an investigator acting on behalf of the company must, among other things, apply for and obtain IRB approval of the proposed investigation.

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The IDE must be approved in advance by the FDA for a specified number of study participants, unless the product is deemed a non-significant risk device and eligible for abbreviated IDE requirements.

Generally, clinical trials for a significant risk device may begin once the IDE is approved by the FDA and the study protocol and informed consent are approved by a duly-appointed IRB at each clinical trial site.

Generally, clinical trials for a significant risk device may begin once the IDE is approved by the FDA and the study protocol and informed consent form are approved by a duly-appointed IRB at each clinical trial site.

FDA’s IDE regulations govern investigational device labeling, prohibit promotion, and specify an array of GCP requirements, which include, among other things, recordkeeping, reporting and monitoring responsibilities of study sponsors and study investigators.

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• compliance with the QSR, which requires manufacturers to follow stringent design, testing, control, documentation, record maintenance, including maintenance of complaint and related investigation files, and other quality assurance controls during the manufacturing process;

• unannounced routine or for-cause device facility inspections by the FDA;

• labeling regulations, which prohibit the promotion of products for uncleared or unapproved (or “off-label”) uses and impose other restrictions relating to promotional activities;

• pre-scheduled or unannounced device facility inspections by the FDA;

• labeling regulations, which prohibit the promotion of devices for uncleared or unapproved (or “off-label”) uses and impose other restrictions relating to promotional activities;

• corrections and removal reporting regulations, which require that manufacturers report to the FDA field corrections or removals if undertaken to reduce a risk to health posed by a device or to remedy a violation of the FDCA that may present a risk to health;

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• total or partial suspension of production;

• delay or refusal of the FDA or other regulators to grant 510(k) clearance or PMA approvals of new products;

• delay or refusal of the FDA or other regulators to grant 510(k) clearance or PMA approvals of new or modified devices;

• withdrawals of marketing authorization;

• in the most serious cases, criminal prosecution.

To ensure compliance with regulatory requirements, medical device manufacturers are subject to market surveillance and periodic, pre-scheduled and unannounced inspections by the FDA, and these inspections may include the manufacturing facilities of subcontractors and third-party component suppliers.

To ensure compliance with regulatory requirements, medical device manufacturers are subject to market surveillance and periodic, prescheduled or unannounced inspections by the FDA, and these inspections may include the manufacturing facilities of subcontractors and third-party component suppliers.

FDA Review and Approval Process for Combination Products

A combination product is a product composed of a combination of two or more FDA-regulated product components or products, e.g., drug-device or biologic-device.

Such products often raise regulatory, policy and review management challenges because they integrate components that are regulated under different types of regulatory requirements and by different FDA Centers, namely, the Center for Drug Evaluation and Research, or CDER, the Center for Devices and Radiological Health, or CDRH, or the Center for Biologics Evaluation and Research, or CBER.

Differences in regulatory pathways for each component can impact the regulatory processes for all aspects of product development and management, including preclinical testing, clinical investigation, marketing applications, manufacturing and quality control, adverse event reporting, promotion and advertising, and post-approval modifications.

A combination product is a product composed of a combination of two or more FDA-regulated product constituent parts or products, e.g., drug-device or biologic-device.

Such products often raise regulatory, policy and review management challenges because they integrate constituent parts that are regulated under different types of regulatory requirements and by different FDA Centers, namely, the Center for Drug Evaluation and Research, or CDER, the Center for Devices and Radiological Health, or CDRH, or the Center for Biologics Evaluation and Research, or CBER.

Differences in regulatory pathways for each constituent part can impact the regulatory processes for all aspects of product development and management, including preclinical testing, clinical investigation, marketing applications, manufacturing and quality control, adverse event reporting, promotion and advertising, and post-approval modifications.

Specifically, under regulations issued by the FDA, a combination product may be:

• a product comprised of two or more regulated components that are physically, chemically, or otherwise combined or mixed and produced as a single entity;

• a product comprised of two or more regulated constituent parts that are physically, chemically, or otherwise combined or mixed and produced as a single entity;

• two or more separate products packaged together in a single package or as a unit and comprised of drug and device products;

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In most instances, the Lead Center applies its usual regulatory pathway.

For example, a drug-device combination product assigned to CDER will typically be reviewed under an NDA, while a drug-device combination product assigned to CDRH is typically reviewed under through a 510(k), PMA, or de novo reclassification request.

Often it is difficult for OCP to determine with reasonable certainty the most important therapeutic action of the combination product.

In those difficult cases, OCP will consider consistency with other combination products raising similar types of safety and effectiveness questions, or which Center has the most expertise to evaluate the

most significant safety and effectiveness questions raised by the combination product.

A sponsor may use a voluntary formal process, known as a Request for Designation, when the product classification is unclear or in dispute, to obtain a binding decision as to which Center will regulate the combination product.

If the sponsor objects to that decision, it may request that the agency reconsider that decision.

If the sponsor objects to that decision, the sponsor may request that OCP reconsider its decision.

Combination products are subject to FDA user fees based on the type of application submitted for the product’s premarket approval or clearance.

For example, a combination product for which an NDA is submitted is subject to the NDA fee under the PDUFA.

Likewise, a combination product for which a PMA is submitted is subject to the PMA fee under the Medical Device User Fee and Modernization Act of 2002.

Since a combination product incorporates two or more components that have different regulatory requirements, a combination product manufacturer must comply with all cGMP and QSR requirements that apply to each component.

For example, a combination product for which an NDA is submitted is subject to the NDA fee under PDUFA.

Likewise, a combination product for which a PMA is submitted is subject to the PMA fee under the Medical Device User Fee and Modernization Act.

Since a combination product incorporates two or more constituent parts that have different regulatory requirements, a combination product manufacturer must comply with all cGMP and QSR requirements that apply to each constituent part.

The FDA has issued a combination product cGMP regulation, along with final guidance, describing two approaches a combination product manufacturer may follow to demonstrate compliance.

Under these two options, the manufacturer demonstrates compliance with:

(1) All cGMP regulations applicable to each separate regulated component included in the combination product;

or (2) either the drug cGMPs or the QSR, as well as with specified provisions from the other of these two sets of requirements (also called the “streamlined approach”).

In addition, The 21st Century Cures Act, or the Cures Act, which became law in December 2016 and, among other things, amended provisions of the FDCA, clarified that for drug-device combination products comprising an FDA-approved drug and device primary mode of action, Hatch-Waxman Act requirements apply.

Accordingly, a potential patent dispute regarding the listed drug that is being referenced by the combination product sponsor may result in the delay of the 510(k) clearance or PMA approval of the combination product.

Furthermore, the Cures Act amendments applied Hatch-Waxman Act exclusivity provisions (e.g., new chemical entity and new clinical investigation) to the device clearance and approval process for combination products with a device primary mode of action.

(1) All cGMP regulations applicable to each separate

regulated constituent part included in the combination product;

or (2) either the drug cGMP or the QSR, as well as with specified provisions from the other of these two sets of requirements (also called the “streamlined approach”).

In addition, The 21st Century Cures Act, or the Cures Act, which became law in December 2016 and, among other things, amended provisions of the FDCA, clarified that for drug-device combination products with a device PMOA and an FDA-approved drug constituent part, Hatch-Waxman Act requirements apply.

Accordingly, a potential patent dispute regarding the listed drug that is being referenced by the combination product sponsor may delay the marketing authorization of the combination product.

New Drug Marketing Exclusivity under the Hatch-Waxman Act Amendments & GAIN Exclusivity Extension

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At the same time, the FDA must also determine that the generic drug is “bioequivalent” to the innovator drug.

Under the statute, a generic drug is bioequivalent to a RLD if “the rate and extent of absorption of the drug do not show a significant difference from the rate and extent of absorption of the listed drug.” Upon approval of an ANDA, the FDA indicates whether the generic product is “therapeutically equivalent” to the RLD in its publication “Approved Drug Products with Therapeutic Equivalence Evaluations,” also referred to as the “Orange Book.” Physicians and pharmacists consider a therapeutic equivalent generic drug to be fully substitutable for the RLD.

Physicians and pharmacists consider a therapeutic equivalent generic drug to be fully substitutable for the RLD.

In addition, by operation of certain state laws and numerous health insurance programs, the FDA’s designation of therapeutic equivalence often results in substitution of the generic drug without the knowledge or consent of either the prescribing physician or patient.

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A certification that the new product will not infringe the already approved product’s listed patents, or that such patents are invalid, is called a Paragraph IV certification.

If the follow-on applicant has provided a Paragraph IV certification to the FDA, the applicant must also send notice of the Paragraph IV certification to the NDA and patent holders once the ANDA or 505(b)(2) NDA has been accepted for filing by the FDA.

If the follow-on applicant has provided a Paragraph IV certification to the FDA, the applicant

must also send notice of the Paragraph IV certification to the NDA and patent holders once the ANDA or 505(b)(2) NDA has been accepted for filing by the FDA.

The NDA and patent holders may then initiate a patent infringement lawsuit in response to the notice of the Paragraph IV certification.

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The length of the patent term extension is related to the length of time the drug or medical device is under regulatory review while the patent is in force.

The restoration period granted on a patent covering a new FDA-regulated medical product is typically one-half the time between the date a clinical investigation on human beings is begun and the submission date of an application for premarket approval of the product, plus the time between the submission date of an application for approval of the product and the ultimate approval date.

between the submission date of an application for approval of the product and the ultimate approval date.

Patent term restoration cannot be used to extend the remaining term of a patent past a total of 14 years from the product’s approval date.

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Failure to timely register a covered clinical study or to submit study results as provided for in the law can give rise to civil monetary penalties and also prevent the non-compliant party from receiving future grant funds from the federal government.

The NIH’s Final Rule on ClinicalTrials.gov registration and reporting requirements became effective in 2017, and both NIH and the FDA have recently signaled the government’s willingness to begin enforcing those requirements against non-compliant clinical trial sponsors.

The NIH’s Final Rule on ClinicalTrials.gov registration and reporting requirements became effective in 2017, and both NIH and the FDA have recently begun enforcing those requirements against non-compliant clinical trial sponsors.

Health Care Laws and Compliance Requirements

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These laws include, among others, health care information and data privacy protection laws, transparency laws, and fraud and abuse laws, such as:

• The federal Anti-Kickback Statute prohibits, among other things, any person from knowingly and willfully offering, providing, soliciting or receiving remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce either the referral of an individual, for an item or service or the purchasing or ordering of a good or service, for which payment may be made under federal healthcare programs such as the Medicare and Medicaid programs.

• The federal Anti-Kickback Statute prohibits, among other things, any person from knowingly and willfully offering, providing, soliciting or receiving remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce either the referral of an individual, for an item or service or the purchasing or ordering of a good or service, for which payment may be made under federal health care programs such as the Medicare and Medicaid programs.

The federal Anti-Kickback Statute is subject to evolving interpretations.

the government has enforced the federal Anti-Kickback Statute to reach large settlements with healthcare companies based on sham consulting and other financial arrangements with physicians.

In the past, the government has enforced the federal Anti-Kickback Statute to reach large settlements with health care companies based on sham consulting and other financial arrangements with physicians.

A person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

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The federal government uses these laws, and the accompanying threat of significant liability, in its investigation and prosecution of pharmaceutical and biotechnology companies throughout the U.S., for example, in connection with the promotion of products for unapproved uses and other allegedly unlawful sales and marketing practices;

federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, created new federal, civil and criminal statutes that prohibit among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services.

federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, created new federal, civil and criminal statutes that prohibit among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud any health care benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a health care benefit program, willfully obstructing a criminal investigation of a health care offense, and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for health care benefits, items or services.

Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

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• HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, or HITECH, and their respective implementing regulations impose specified requirements relating to the privacy, security and transmission of individually identifiable health information.

Among other things, HITECH makes HIPAA’s privacy and security standards directly applicable to “business associates,” defined as independent contractors or agents of covered entities, which include certain healthcare providers, health plans, and healthcare clearinghouses, that create, receive, maintain or transmit protected health information in connection with providing a service for or on behalf of a covered entity.

Among other things, HITECH makes HIPAA’s privacy and security standards directly applicable to “business associates,” defined as independent contractors or agents of covered entities, which include certain health care providers, health plans, and health care clearinghouses, that create, receive, maintain or transmit protected health information in connection with providing a service for or on behalf of a covered entity.

HITECH also increased the civil and criminal penalties that may be imposed against covered entities, business associates and possibly other persons, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce HIPAA and seek attorney’s fees and costs associated with pursuing federal civil actions;

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Moreover, in November 2020, the U.S.

Department of Health and Human Services finalized significant changes to the regulations implementing the Anti-Kickback Statute, as well as the Physician Self-Referral Law (Stark Law) and the civil monetary penalty rules regarding beneficiary inducements, with the goal of offering the healthcare industry more flexibility and reducing the regulatory burden associated with those fraud and abuse laws, particularly with respect to value-based arrangements among industry participants.

Department of Health and Human Services finalized significant changes to the regulations implementing the Anti-Kickback Statute and the civil monetary penalty rules regarding beneficiary inducements, with the goal of offering the health care industry more flexibility and reducing the regulatory burden associated with those fraud and abuse laws, particularly with respect to value-based arrangements among industry participants.

To the extent we commercialize or co-promote our products, if approved, and because such products could be reimbursed under federal and other governmental health care programs, we expect to develop a compliance program that establishes internal controls to facilitate adherence to the rules and health care program requirements.

Although compliance programs and adherence thereto may mitigate the risk of violation of and subsequent investigation and prosecution for violations of the laws described above, the risks cannot be eliminated entirely.

Ensuring that our current and future business arrangements with third parties comply with applicable healthcare laws and regulations could involve substantial costs.

It is possible that governmental authorities will conclude that our business practices do not comply with current or future statutes, regulations, agency guidance or case law involving applicable fraud and abuse or other healthcare laws and regulations.

If we or our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to significant civil, criminal and administrative penalties, including monetary damages, fines, individual imprisonment, disgorgement, loss of eligibility to obtain approvals from the FDA, exclusion from participation in government contracting, healthcare reimbursement or other government programs, including Medicare and Medicaid, contractual damages, reputational harm, administrative burdens, diminished profits and future earnings, additional reporting requirements if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with any of these laws, and/or the curtailment or restructuring of our operations.

If any of the physicians or other healthcare providers or entities with whom we expect to do business is found to be not in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs.

Ensuring that our current and future business arrangements with third parties comply with applicable health care laws and regulations could involve substantial costs.

If we or our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to significant civil, criminal and administrative penalties, including monetary damages, fines, individual imprisonment, disgorgement, loss of eligibility to obtain approvals from the FDA, exclusion from participation in government contracting, health care reimbursement or other government programs, including Medicare and Medicaid, contractual damages, reputational harm, administrative burdens, diminished profits and future earnings, additional reporting requirements if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with any of these laws, and/or the curtailment or restructuring of our operations.

If any of the physicians or other health care providers or entities with whom we expect to do business is found to be not in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded health care programs.

Coverage, Pricing, and Reimbursement

Sales of our drug and drug-device combination products, if approved, will depend, in part, on the extent to which the costs of our products will be covered by third-party payors, such as government health care programs, private health insurers, managed health care providers, and other organizations.

private health insurers, managed health care providers, and other organizations.

These third-party payors are increasingly challenging drug prices and examining the medical necessity and cost-effectiveness of medical products and services, in addition to their safety and efficacy.

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Net prices for products may be reduced by mandatory discounts or rebates required by third-party payors and by any future relaxation of laws that presently restrict imports of products from countries where they may be sold at lower prices than in the United States.

In the U.S., third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement policies, but they also have their own methods and approval process apart from Medicare coverage and reimbursement determinations.

In the United States, third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement policies, but they also have their own methods and approval process apart from Medicare coverage and reimbursement determinations.

Accordingly, one third-party payor’s determination to provide coverage for a product does not assure that other payors will also provide coverage for the product.

Accordingly, the coverage determination process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our products to each payor separately, with no assurance that coverage and adequate payment will be applied consistently or obtained.

The process for determining whether a payor will cover and how much it will reimburse a product may be separate from the process of seeking approval of the product or for setting the price of the product.

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The ACA also increased the Medicaid rebate rate and the volume of rebated drugs has been expanded to include beneficiaries in Medicaid managed care organizations.

The ACA also expanded the 340B drug discount program (excluding orphan drugs), including a 50% discount on brand name drugs for Medicare Part D participants in the coverage gap, and revised the definition of “average manufacturer price” for reporting purposes, which could increase the amount of the Medicaid drug rebates paid to states.

drug rebates paid to states.

It also contains substantial provisions intended to broaden access to health insurance, reduce or constrain the growth of health care spending, enhance remedies against health care fraud and abuse, add new transparency requirements for the health care industry, impose new taxes and fees on pharmaceutical manufacturers, and impose additional health policy reforms, any or all of which may affect our business.

Since its enactment there have been judicial and congressional challenges to certain aspects of the ACA, and we expect there will be additional challenges and amendments to the ACA in the future.

Certain members of the U.S.

Congress have indicated that they may continue to seek to modify, repeal or otherwise invalidate all, or certain provisions of, the ACA.

While Congress has to date not passed comprehensive repeal legislation, two bills affecting the implementation of certain taxes under the ACA have been signed into law.

For example, the Tax Cuts and Jobs Act of 2017 repealed the tax-based shared responsibility payment imposed by the ACA on certain individuals who fail to maintain qualifying health coverage for all or part of a year that is commonly referred to as the "individual mandate." In December 2019, the Fifth Circuit Court of Appeals upheld a district court's finding that the individual mandate in the ACA is unconstitutional following removal of the penalty provision from the law.

However, the Fifth Circuit reversed and remanded the case to the district court to determine if other reforms enacted as part of the ACA, but not specifically related to the individual mandate or health insurance, could be severed from the rest of the ACA so as not to have the law declared invalid in its entirety.

In March 2020, the U.S.

Supreme Court granted the petitions for writs of certiorari to review this case and, in November 2020, heard oral arguments.

A decision from the Supreme Court is expected to be issued in spring 2021.

It is unclear how this litigation and other efforts to repeal and replace the ACA will affect the implementation of that law, the pharmaceutical industry more generally, and our business.

We continue to evaluate the potential impact of the ACA and its possible repeal or replacement on our business.

Since enactment of the ACA, there have been judicial and Congressional challenges to certain aspects of the ACA, and as a result certain sections of the ACA have not been fully implemented or have been effectively repealed through Executive Orders and/or executive agency actions.

However, following several years of litigation in the federal courts, in June 2021, the U.S.

Supreme Court upheld the ACA when it dismissed a legal challenge to the ACA’s constitutionality.

Further legislative and regulatory changes under the ACA remain possible, although the new federal administration under President Biden has signaled that it plans to build on the ACA and expand the number of people who are eligible for health insurance subsidies under it.

It is unknown what form any such changes or any law would take, and how or whether it may affect the biopharmaceutical industry as a whole or our business in the future.

We expect that changes or additions to the ACA, the Medicare and Medicaid programs, such as changes allowing the federal government to directly negotiate drug prices, and changes stemming from other healthcare reform measures, especially with regard to healthcare access, financing or other legislation in individual states, could have a material adverse effect on the health care industry in the United States.

Other legislative changes have also been proposed and adopted since the ACA was enacted.

These changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013 and will remain in effect through 2030 unless additional Congressional action is taken.

The Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, which

was signed into law on March 27, 2020 and was designed to provide financial support and resources to individuals and businesses affected by the COVID-19 pandemic, suspended the 2% Medicare sequester from May 1, 2020 through December 31, 2020, and extended the sequester by one year, through 2030, in order to offset the added expense of the 2020 cancellation.

The Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, which was signed into law on March 27, 2020 and was designed to provide financial support and resources to individuals and businesses affected by the COVID-19 pandemic, suspended the 2% Medicare sequester from May 1, 2020 through December 31, 2020 (the suspension was subsequently extended through March 31, 2022, with a reduction of the suspension to 1% sequester through June 30, 2022), and extended the sequester by one year, through 2030, in order to offset the added expense of the 2020 cancellation.

The 2021 Consolidated Appropriations Act was subsequently signed into law on December 27, 2020 and extends the CARES Act suspension period to March 31, 2021.

The Biden Administration, which assumed control of the Executive Branch on January 20, 2021, has indicated that lowering prescription drug prices is a priority, but we do not yet know what steps the administration will take or whether such steps will be successful, It is uncertain whether and how future legislation or regulatory changes could affect prospects for our product candidates or what actions federal, state, or commercial payors for pharmaceutical products may take in response to any such health care reform proposals or legislation.

The Biden Administration, which assumed control of the Executive Branch on January 20, 2021, has indicated that lowering prescription drug prices is a priority.

For example, in July 2021, President Biden issued a sweeping executive order on promoting competition in the American economy that includes several mandates pertaining to the pharmaceutical and health care insurance industries.

Among other things, the executive order directs the FDA to work towards implementing a system for importing drugs from Canada (following on a Trump administration notice-and-comment rulemaking on Canadian drug importation that was finalized in October 2020).

The Biden order also called on HHS to release a comprehensive plan to combat high prescription drug prices, and it includes several directives regarding the Federal Trade Commission’s oversight of potentially anticompetitive practices within the pharmaceutical industry.

The drug pricing plan released by HHS in September 2021 in response to the executive order makes clear that the Biden Administration supports aggressive action to address rising drug prices, including allowing HHS to negotiate the cost of Medicare Part B and D drugs, but such significant changes will require either new legislation to be passed by Congress or time-consuming administrative actions.

It is uncertain whether and how future legislation or regulatory changes could affect prospects for our product candidates or what actions federal, state, or commercial payors for pharmaceutical products may take in response to any such health care reform proposals or legislation.

Adoption of price controls and cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures reforms may prevent or limit our ability to generate revenue, attain profitability or commercialize our product candidates.

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Our customers and research partners must comply with laws governing the privacy and security of health information, including HIPAA, HITECH and state health information privacy laws.

If we knowingly obtain health information that is protected under HIPAA, called “protected health information,” our customers or research collaborators may be subject to enforcement and we may have direct liability for the unlawful receipt of protected health information or for aiding and abetting a HIPAA violation.

If we knowingly obtain health information that is protected under HIPAA, called “protected health information,” our customers or

research collaborators may be subject to enforcement and we may have direct liability for the unlawful receipt of protected health information or for aiding and abetting a HIPAA violation.

State laws protecting health and personal information are becoming increasingly stringent.

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For example, in August 2017, the FDA Reauthorization Act was signed into law, which reauthorized the FDA’s user fee programs and included additional drug and device provisions that build on the Cures Act enacted in December 2016.

Furthermore, the next FDA Reauthorization Act is currently being negotiated and is due to be submitted to Congress in 2022.

If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we otherwise may have obtained and we may not achieve or sustain profitability, which would adversely affect our business, prospects, financial condition and results of operations.

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Clinical trial applications must be accompanied by an investigational medicinal product dossier with supporting information prescribed by the European Clinical Trials Directive and corresponding national laws of the member states and further detailed in applicable guidance documents.

In April 2014, the new Clinical Trials Regulation, (EU) No 536/2014 (Clinical Trials Regulation) was adopted and it is anticipated to come into application in late 2021.

In April 2014, the new Clinical Trials Regulation, (EU) No 536/2014 (Clinical Trials Regulation) was adopted and became effective on January 31, 2022.

The Clinical Trials Regulation will be directly applicable in all the EU Member States, repealing the current Clinical Trials Directive 2001/20/EC.

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The penalties could include warnings, orders to discontinue the promotion of the drug product, seizure of promotional materials, fines and possible imprisonment.

In addition, medical devices marketed in Europe currently are required to comply with the Essential Requirements defined in Annex I to the EU Medical Devices Directive, or MDD, a coordinated system for the authorization of medical devices.

The directives and standards regulate the design, manufacture, clinical trials, labeling and adverse event reporting for medical devices.

Prior to May 26, 2021, the date on which the new Medical Device Regulation ("MDR") became effective, medical devices marketed in Europe were required to comply with the Essential Requirements defined in Annex I to the EU Medical Devices Directive, or MDD, a coordinated system for the authorization of medical devices.

The MDD regulated the design, manufacture, clinical trials, labeling and adverse event reporting for medical devices.

Devices that comply with the requirements of a relevant directive are entitled to bear the CE conformity marking, indicating that the device conforms to the essential requirements of the applicable directives.

The method of assessing conformity varies depending on the class of the product, but normally involves a combination of self-assessment by the manufacturer and a third-party assessment by a “Notified Body.” This third-party assessment may consist of an audit of the manufacturer’s quality system and specific testing of the manufacturer’s product.

An assessment by a Notified Body of one country within the European Union is required in order for a manufacturer to commercially distribute the product throughout the EU.

The method of assessing conformity depended on the class of the product, but normally involved a combination of self-assessment by the manufacturer and a third-party assessment by a “Notified Body.” This third-party assessment may consist of an audit of the manufacturer’s quality system and specific testing of the manufacturer’s product.

In 2017, European Union regulatory bodies finalized a new Medical Device Regulation (“MDR”), which replaced the existing MDD framework and provided three years for transition and compliance, for a final effective date of May 26, 2020.

As a result of the COVID-19 pandemic, however, the European Parliament voted in April 2020 to postpone implementation of the MDR by one year, giving the medical device industry and Notified Bodies until May 26, 2021 to come into compliance assuming no additional delays are needed.

The MDR changes several aspects of the existing regulatory framework for medical device marketing in Europe and is expected to result in increased regulatory oversight of all medical devices marketed in the EU, which may, in turn, increase the costs, time and requirements that need to be met in order to place an innovative or high-risk medical device on the European market.

Specifically, the MDR will require changes in the clinical evidence required for medical devices, post-market clinical follow-up evidence, annual reporting of safety information for Class III products, and bi-annual reporting for Class II products, unique device identification, or UDI, for all products, submission of core data elements to a European UDI database prior to placement of a device on the market, reclassification of medical devices, and multiple other labeling changes.

An assessment by a Notified Body of one country within the European Union and designated under the MDR is required in order for a manufacturer to commercially distribute the product throughout the EU.

A CE certificate issued under the MDD before May 26, 2021 may remain valid until May 25, 2024 under certain conditions.

However, we must acquire approvals under the MDR for new products and renew our existing CE mark certificates once our current certifications expire, which could be challenging and costly.

Review and Approval of Medicinal Products in Canada

Health Canada is the Canadian federal authority that regulates, evaluates and monitors the safety, effectiveness, and quality of drugs, medical devices, and other therapeutic products available to Canadians.

Canada’s regulatory process for review, approval and regulatory oversight of products is similar to the regulatory process conducted by the FDA.

Health Canada’s regulatory process for review, approval and regulatory oversight of products is similar to the regulatory process conducted by the FDA.

To initiate clinical testing of a drug candidate in human subjects in Canada, a CTA must be filed with and approved by Health Canada.

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Regulatory obligations and oversight continue following the initial market approval of a pharmaceutical product.

For example, every market authorization holder must report any new information received concerning adverse drug reactions, including timely reporting of serious adverse drug reactions that occur in Canada and any serious unexpected adverse drug reactions that occur outside of Canada.

serious unexpected adverse drug reactions that occur outside of Canada.

The market authorization holder must also notify Health Canada of any new safety and efficacy issues that it becomes aware of after the launch of a product.

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The requirements governing the conduct of clinical studies, product licensing, pricing and reimbursement vary greatly from country to country.

some international markets, additional clinical trials may be required prior to the filing or approval of marketing applications within the country.

In some international markets, additional clinical trials may be required prior to the filing or approval of marketing applications within the country.

Moreover, outside of the United States, pricing and reimbursement schemes vary widely from country to country.

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This is because the GDPR allows EU member states to derogate from the requirements of the GDPR mainly in regard to specific processing situations (including special category data and processing for scientific or statistical purposes).

As the EU states continue to reframe their national legislation to harmonize with the GDPR, we will need to monitor compliance with all relevant EU member states’ laws and regulations, including where permitted derogations from the GDPR are introduced.

As the EU states

continue to reframe their national legislation to harmonize with the GDPR, we will need to monitor compliance with all relevant EU member states’ laws and regulations, including where permitted derogations from the GDPR are introduced.

We will also be subject to evolving EU laws on data export, if we transfer data outside the EU to ourselves or third parties outside of the EU.

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corporations and their representatives from offering, promising, authorizing or making payments to any foreign government official, government staff member, political party or political candidate in an attempt to obtain or retain business abroad.

The scope of the FCPA would include interactions with certain healthcare professionals in many countries, either directly or through third parties.

The scope of the FCPA would include interactions with certain health care professionals in many countries, either directly or through third parties.

Our present and future business has been and will continue to be subject to various other U.S.

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As of March 30, 2022, we had 28 employees.

Sixteen of our employees are full-time and seven are part-time employees, 12 are in research and development and 11 are in general and administrative.

Twenty of our employees are full-time and eight are part-time, 17 are in research and development and 11 are in general and administrative.

Given the differing characteristics of our product candidates, our approach is to engage consultants with experience in varying specialties to help us develop such candidates.

Our numerous consultants serve as an extension to our employee base.

We believe this approach will enable us to access the expertise needed in a cost-efficient manner and without the need to rapidly increase the number of full-time employees and their associated costs.

We believe this approach enables us to access the expertise needed in a cost-efficient manner and without the need to rapidly increase the number of full-time employees and their associated costs.

In the future, if we select a commercialization strategy for a

product or product candidate that requires us to establish marketing, sales or distribution infrastructure and capabilities, we may need to rapidly increase our employee base.

What changed 10-K

Item 1. Business