What changed in this filing

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Item 1A. Risk Factors

2026-06-29 compared with 2025-06-30 · 524 added, 455 removed, 1187 unchanged (45% of the section changed)

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of generic equivalents of our products by competitors.

operations could be disrupted by failure of our information systems or cyber-attacks and artificial.

operations could be disrupted by failure of our information systems or cyber-attacks.

intelligence (“AI”) based platforms may present new risks and challenges to our business.

in product development may result in failure to achieve adequate return on investment.

business is dependent on market acceptance of our products and social and political pressures, including public concern over the abuse

of certain products, including opioids may adversely affect our business.

business is dependent on market acceptance of our products and social and political pressures, including public concern over the

abuse of certain products, including opioids may adversely affect our business.

economic conditions may adversely affect our business.

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have identified material weaknesses in our internal controls over financial reporting

While we currently qualify as a smaller reporting company under SEC regulations, we cannot be certain, if we take

advantage of the reduced disclosure requirements applicable to these companies, that we will not make our stock less attractive to investors.

Once we lose smaller reporting company status, the costs and demands placed upon our management are expected to increase.

have a relatively limited operating history and our operating results could fluctuate significantly.

we currently qualify as a smaller reporting company under SEC regulations, we cannot be certain, if we take advantage of the reduced

disclosure requirements applicable to these companies, that we will not make our stock less attractive to investors.

smaller reporting company status, the costs and demands placed upon our management are expected to increase.

operating results could fluctuate significantly.

ability to fund operations is uncertain and we may require additional financing to meet objectives.

most likely will require additional financing to meet our business objectives.

have substantial indebtedness which may adversely affect our financial condition.

is a risk of impairment of significant intangible assets on our balance sheet.

requires estimates, judgements and assumptions which inherently contain uncertainties.

requires estimates, judgments and assumptions which inherently contain uncertainties.

and Regulatory Risks

pharmaceutical industry is heavily regulated, which creates uncertainty and substantial compliance costs.

at the FDA, the DEA, the SEC, and other government agencies could negatively impact our business.

business may be adversely affected by legislation or healthcare regulatory reform and initiatives.

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States and internationally.

reporting and payment obligations under the Medicaid rebate program.

reporting and payment obligations under the Medicaid rebate and other governmental programs.

Investigations

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Related to our Common Shares

from issuance of shares to Lincoln Park Capital Fund, LLC, Directors, Employees, Consultants or upon exercise of warrants and options or the

perception that dilution may occur could cause the price per share of common stock to fall.

from issuance of shares pursuant to the exercise of warrants and options or the perception that dilution may occur could cause the

price per share of common stock to fall.

common stock is a penny stock, quoted on the OTC bulletin board, with rules in place that could limit trading and liquidity of our

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depend on third-party suppliers and distributors for the raw materials for our products.

Our success, if any, will depend in part on our ability to

successfully keep pace with these factors.

success, if any, will depend in part on our ability to successfully keep pace with these factors.

we expand our presence in the generic pharmaceuticals market our products may face intense competition from brand-name companies that

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effect on our operations, our business, results of operations and stock price.

addition, outbreaks of contagious diseases and other adverse public health developments affecting us and/or the third parties on which

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

For example, the COVID-19

pandemic, which impacted the operation of healthcare systems, global travel, supply and labor markets and other business and economic

activity worldwide, had a disruptive and adverse impact on our financial condition and results of operations and on those of many of

the third parties on which we rely.

the acute COVID-19 public health emergency has lapsed, we will continue to monitor its long-term impacts, including impacts on market

practices and on the labor market, and adjust our policies and practices as needed to mitigate any adverse impacts to our business operations

and financial condition.

We will also work with our internal teams and the third-parties on which we rely to assess, and seek to mitigate,

the potential impacts on our business operations and financial condition of any future outbreaks of contagious diseases or other adverse

public health developments that may emerge from time to time.

Interruptions

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with cGMP and, in the case of controlled substances, DEA regulations.

with the FDA’s cGMP and DEA requirements applies to both drug products seeking regulatory approval and to approved drug products.

In complying with cGMP requirements, pharmaceutical manufacturing facilities must continually expend significant time, money and effort

in production, recordkeeping, quality assurance and quality control so that their products meet applicable specifications and other requirements

for product safety, efficacy and quality.

Failure to comply with applicable legal requirements subjects us, our manufacturing facilities

and the facilities of our third-party suppliers to possible legal or regulatory action, including, without limitation, shutdown, which

may adversely affect our ability to supply the product.

Additionally, our manufacturing facilities, and those of our third-party suppliers

may face other significant disruptions due to labor strikes, failure to reach acceptable agreement with labor unions, infringement of

intellectual property rights, vandalism, natural disaster, pandemics, storm or other environmental damage, civil or political unrest,

export or import restrictions or other events.

Were we not able to manufacture products at our manufacturing facilities or were our third-party suppliers unable to manufacture products at their facilities because of regulatory, business or any other reasons, the manufacture

and marketing of these products would be interrupted.

This could have a material adverse impact on our business, results of operation,

financial condition, cash flows, competitive position and ability to operate.

Compliance with the FDA’s cGMP and DEA requirements applies

to both drug products seeking regulatory approval and to approved drug products.

In complying with cGMP requirements, pharmaceutical

manufacturing facilities must continually expend significant time, money and effort in production, recordkeeping, quality assurance and

quality control so that their products meet applicable specifications and other requirements for product safety, efficacy and quality.

Failure to comply with applicable legal requirements subjects us, our manufacturing facilities and the facilities of our third-party

suppliers to possible legal or regulatory action, including, without limitation, shutdown, which may adversely affect our ability to

supply the product.

Additionally, our manufacturing facilities, and those of our third-party suppliers may face other significant disruptions

due to labor strikes, failure to reach acceptable agreement with labor unions, infringement of intellectual property rights, vandalism,

natural disaster, pandemics, storm or other environmental damage, civil or political unrest, export or import restrictions or other events.

Were we not able to manufacture products at our manufacturing facilities or were our third-party suppliers unable to manufacture products

at their facilities because of regulatory, business or any other reasons, the manufacture and marketing of these products would be interrupted.

This could have a material adverse impact on our business, results of operation, financial condition, cash flows, competitive position

and ability to operate.

all of our manufacturing operations are conducted at the Northvale Facility and any delays or unanticipated expenses in connection with

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However, as other generic manufacturers receive regulatory approvals for their own generic

versions, that market share, and the price of the that product, will typically decline depending on several factors, including, without

limitation, the number of competitors, the price of the branded product and the pricing strategy of the new competitors.

competition in the generic pharmaceutical marketplace is not uncommon with one result of such being significant decline in revenue and

gross margins.

There can be no assurances of our ability to continue to develop new products or that the number of competitors for any

given product will not increase to such an extent that we may stop marketing a generic drug product for which we previously obtained

approval, resulting in a material adverse effect on our business, financial condition, results of operations, cash flow, ability to operate

and stock price.

versions, that market share, and the price of that product, will typically decline depending on several factors, including, without limitation,

the number of competitors, the price of the branded product and the pricing strategy of the new competitors.

Significant competition

in the generic pharmaceutical marketplace is not uncommon with one result of such being significant decline in revenue and gross margins.

There can be no assurances of our ability to continue to develop new products or that the number of competitors for any given product

will not increase to such an extent that we may stop marketing a generic drug product for which we previously obtained approval, resulting

in a material adverse effect on our business, financial condition, results of operations, cash flow, ability to operate and stock price.

operations could be disrupted by failure of our information systems or cyber-attacks.

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prevalence and severity of any adverse side effects;

● Availability

of alternative treatments;

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would reduce our revenue and future profitability.

concern over the abuse of opioid medications, including increased legal and regulatory action, could also negatively affect our

Certain governmental and regulatory agencies, as well as state and local jurisdictions, are focused on the abuse of opioid

medications in the United States.

State and local governmental agencies may investigate us as a manufacturer and/or distributor of

medicines containing opioids or in conjunction with their investigation of other pharmaceutical wholesale distributors, and others

in the supply chain that have a direct or indirect connection to our operations in relation to the distribution of opioid

In addition, multiple lawsuits have been filed against other pharmaceutical manufacturers and distributors alleging,

among other claims, that they failed to provide effective controls and procedures to guard against the diversion of controlled

substances, acted negligently by distributing controlled substances to pharmacies that serve individuals who abuse controlled

substances, and failed to report suspicious orders of controlled substances in accordance with regulations.

Additional governmental

entities have indicated an intent to sue these other manufacturers and distributors.

While no such actions have been taken against

us, the immediate effect on the Company has been an inability to commercialize and market three opioid products approved during

fiscal years prior to the year ended March 31, 2021 and a cessation of orders for another two other opioid products that had been

marketed by our marketing partners.

During the year ended March 31, 2020, we disposed of four approved ANDAs for opioid products.

currently hold four approved ANDAs for opioid products, with three of these being commercially sold and one to be commercially

launched within a timeframe that is beneficial to the Company’s interests.

Further, defense against any such opioid related

lawsuits could be cost-prohibitive resulting in an adverse material effect on our business, financial condition, results of

operations, cash flows and stock price.

Similar allegations made against us, even without litigation, could also negatively affect

our business in various ways, including through increased costs and harm to our reputation.

In addition, an adverse resolution of

any lawsuit or investigation could also have a material adverse effect on our business, results of operations, cash flows and stock

concern over the abuse of opioid medications, including increased legal and regulatory action, could also negatively affect our business.

Certain governmental and regulatory agencies, as well as state and local jurisdictions, are focused on the abuse of opioid medications

in the United States.

State and local governmental agencies may investigate us as a manufacturer and/or distributor of medicines containing

opioids or in conjunction with their investigation of other pharmaceutical wholesale distributors, and others in the supply chain that

have a direct or indirect connection to our operations in relation to the distribution of opioid medications.

In addition, multiple lawsuits

have been filed against other pharmaceutical manufacturers and distributors alleging, among other claims, that they failed to provide

effective controls and procedures to guard against the diversion of controlled substances, acted negligently by distributing controlled

substances to pharmacies that serve individuals who abuse controlled substances, and failed to report suspicious orders of controlled

substances in accordance with regulations.

Additional governmental entities have indicated an intent to sue these other manufacturers

and distributors.

While no such actions have been taken against us, the immediate effect on the Company has been an inability to commercialize

and market three opioid products approved during fiscal years prior to the year ended March 31, 2021 and a cessation of orders for another

two other opioid products that had been marketed by our marketing partners.

During the year ended March 31, 2020, we disposed of four

approved ANDAs for opioid products.

We currently hold four approved ANDAs for opioid products.

Further, defense against

any such opioid related lawsuits could be cost-prohibitive resulting in an adverse material effect on our business, financial condition,

results of operations, cash flows and stock price.

Similar allegations made against us, even without litigation, could also negatively

affect our business in various ways, including through increased costs and harm to our reputation.

In addition, an adverse resolution

of any lawsuit or investigation could also have a material adverse effect on our business, results of operations, cash flows and stock

perceptions of our business are important to us, especially market perceptions of the safety and quality of our products.

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depend on qualified scientific and technical personnel and our ability to attract and retain such personnel.

of the specialized scientific nature of our business, we are highly dependent upon our ability to continue to attract and retain

qualified scientific and technical personnel.

We are not aware of any pending, significant losses of scientific or technical

Loss of the services of, or failure to recruit, key scientific and technical personnel, however, would be significantly

detrimental to our product development programs.

As a result of our small size and limited financial and other resources, it may be

difficult for us to attract and retain qualified officers and qualified scientific and technical personnel.

of the specialized scientific nature of our business, we are highly dependent upon our ability to continue to attract and retain qualified

scientific and technical personnel.

We are not aware of any pending, significant losses of scientific or technical personnel.

the services of, or failure to recruit, key scientific and technical personnel, however, would be significantly detrimental to our product

development programs.

As a result of our small size and limited financial and other resources, it may be difficult for us to attract

and retain qualified officers and qualified scientific and technical personnel.

addition, marketing of our branded product, SequestOx™, if approved, will require much greater use of a direct sales force compared

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Collaborations

and licensing arrangements may be terminated, in which case we will experience increased

operating expenses and capital requirements if we elect to pursue further development of

the related product candidate;

and licensing arrangements may be terminated, in which case we will experience increased operating expenses and capital requirements

if we elect to pursue further development of the related product candidate;

Collaborators

and licensees may delay clinical trials and prolong clinical development, under-fund a clinical

trial program, stop a clinical trial, or abandon a product candidate;

revenue might not be generated because milestones may not be achieved, and product candidates

may not be developed;

and licensees may delay clinical trials and prolong clinical development, under-fund a clinical trial program, stop a clinical trial,

or abandon a product candidate;

revenue might not be generated because milestones may not be achieved, and product candidates may not be developed;

Collaborators

and licensees could independently develop, or develop with third parties, products that compete with our future products;

terms of our contracts with current or future collaborators and licensees may not be favorable

to us in the future;

collaborator or licensee with marketing and distribution rights to one or more of our products

may not commit enough resources to the marketing and distribution of our products, limiting

our potential revenues from the commercialization of a product;

may arise delaying or terminating the research, development, or commercialization of our

product candidates, or result in significant and costly litigation or arbitration;

or more third-party developers could obtain approval for a similar product prior to the collaborator

or licensee resulting in unforeseen price competition in connection with the development

terms of our contracts with current or future collaborators and licensees may not be favorable to us in the future;

collaborator or licensee with marketing and distribution rights to one or more of our products may not commit enough resources to

the marketing and distribution of our products, limiting our potential revenues from the commercialization of a product;

may arise delaying or terminating the research, development, or commercialization of our product candidates, or result in significant

and costly litigation or arbitration;

or more third-party developers could obtain approval for a similar product prior to the collaborator or licensee resulting in unforeseen

price competition in connection with the development product.

or all of the above could result in a material adverse effect on our business, financial condition, results of operations, cash flow,

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also expect that we will continue to derive a substantial portion of our revenue from sales to a limited number of customers.

the year ended March 31, 2025, our six largest customers accounted for in excess of 80% of revenues.

The loss of any one or more of

these customers, without replacement by a customer of similar significance, or the substantial reduction in orders from any one or

more of these customers, without replacement of orders of a similar magnitude from other customers, could result in a material

adverse effect on our business, financial condition, results of operations, cash flow, ability to operate and stock

year ended March 31, 2026, our six largest customers accounted for in excess of 75% of revenues.

The loss of any one or more of these

customers, without replacement by a customer of similar significance, or the substantial reduction in orders from any one or more of

these customers, without replacement of orders of a similar magnitude from other customers, could result in a material adverse effect

on our business, financial condition, results of operations, cash flow, ability to operate and stock price.

depend to a large extent on third-party suppliers and distributors for the raw materials for our products, particularly the chemical

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reporting company status, the costs and demands placed upon our management are expected to increase.

SEC’s rules exempt smaller reporting companies, like us, from various reporting requirements applicable to public companies that are

not smaller reporting companies.

SEC’s rules exempt smaller reporting companies, like us, from various reporting requirements applicable to public companies that

are not smaller reporting companies.

As long as we qualify as a smaller reporting company based on our public float and report less than

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control over financial reporting that would otherwise be required by the Sarbanes-Oxley Act.

This Annual Report on Form 10-K reports annual revenues for the fiscal year ended March 31, 2026 in excess of $100

We therefore expect to no longer qualify for smaller reporting company status in the near future.

such time that we lose smaller reporting company status, it is unclear if investors will find our stock less attractive because we may

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process more costly.

have a relatively limited operating history and our operating results could fluctuate significantly.

operating results could fluctuate significantly.

revenues and operating results may vary significantly from year-to-year and quarter-to-quarter as well as in comparison to the corresponding

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of clinical trial programs;

or unexpected health or safety concerns with our products, brand products which we have genericized,

products currently under development or any other product candidates;

● Introduction

or unexpected health or safety concerns with our products, brand products which we have genericized, products currently under development

or any other product candidates;

of new products by others that render our products obsolete or non-competitive;

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of product manufactured and sold due to each product having different gross margins;

cost and outcome of litigation, in the event that such occurs in relation to, without limitation,

IP issues, regulatory or other matters;

ability to comply with complex and numerous governmental regulations and regulatory authorities

which oversee and regulate many aspects of our business and operations;

in coverage and reimbursement policies of health plans and other health insurers, including

changes to Medicare, Medicaid, and similar state programs, especially in relation to those

products that are currently manufactured, under development or identified for future development

by the Company;

cost and outcome of litigation, in the event that such occurs in relation to, without limitation, IP issues, regulatory or other

ability to comply with complex and numerous governmental regulations and regulatory authorities which oversee and regulate many aspects

of our business and operations;

in coverage and reimbursement policies of health plans and other health insurers, including changes to Medicare, Medicaid, and similar

state programs, especially in relation to those products that are currently manufactured, under development or identified for future

development by the Company;

in the cost of raw materials contained within our products;

Manufacturing

and supply interruptions, including product rejections or recalls due to failure to comply

with manufacturing specifications;

and supply interruptions, including product rejections or recalls due to failure to comply with manufacturing specifications;

of revenue recognition relating to our licensing and other agreements;

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of the variation.

addition, although we have been in operation since 1990, we have a relatively short operating history, have only achieved profitability

for the first time during the fiscal year ended March 31, 2021 and limited financial data upon which you may evaluate our business and

There can be no assurances of our ability to sustain current profitability.

Additionally, in certain years prior to the year

ended March 31, 2021, the auditor’s opinion on our financials was qualified with respect to there being substantial doubt as to

the Company’s ability to continue as a going concern due to continued losses not being sufficiently offset by operating revenues.

A failure to generate sufficient revenues to offset related costs of operations will have a material adverse effect on our business,

results of operations, financial condition, cash flow and ability to operate.

addition, we have been in operation since 1990, and were not profitable until the fiscal year ended March 31, 2021.

In certain years

prior to the fiscal year ended March 31, 2021, the auditor’s opinion on our financial statements was qualified with respect to

there being substantial doubt as to the Company’s ability to continue as a going concern due to continued losses not being sufficiently

offset by operating revenues.

There can be no assurances of our ability to sustain current profitability and a failure to generate sufficient

revenues to offset related costs of operations will have a material adverse effect on our business, results of operations, financial

condition, cash flow and ability to operate.

our business model is likely to continue to evolve as we attempt to expand our product offerings and our presence in the generic pharmaceutical

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condition, and cash flow and ability to operate in the future.

ability to fund operations is uncertain and we may require additional financing to meet objectives.

ability to fund our operations, maintain liquidity and meet our financing obligations is reliant on our operations, which are subject

to significant risks and uncertainties.

We rely on cash generated by operations as well as access to financial markets and equipment

financings, to fund our commercial, product development and other operations, maintain liquidity and meet our financial obligations.

There can be no assurances of our ability to secure equipment financing, resulting in an increased risk of our inability to achieve critical

or necessary facility upgrades.

ability to fund and grow operations is uncertain and we may require additional financing to meet objectives.

ability to fund current operations, maintain liquidity and execute growth plans is reliant on resources generated from our operations,

which are subject to significant risks and uncertainties.

We rely mainly on cash generated by operations and have also in the past accessed

financial markets and equipment financings, to fund our commercial, product development and other operations, maintain liquidity and

meet our financial obligations.

of March 31, 2026, we had cash on hand of approximately $30 million and a working capital of approximately $95 million, and for the

year ended March 31, 2026, we generated income from operations totaling approximately $49 million, net other income totaling

approximately $8 million and a net tax expense of approximately $12 million, resulting in a net income of approximatley $45 million.

There can be no assurances of the continuation of revenues being earned from the current generic product line, nor Elite’s

successful commercialization of other products in our development pipeline.

In addition, there can be no assurances of Elite being

able to raise additional funds in a timely manner, on acceptable terms, if needed to support commercial operations, implement

necessary facility upgrades or finance the execution of strategic growth initiatives, resulting in a material detrimental effect on

Elite’s operations and profits as well as having a material adverse effect on our business, results of operations, financial

condition, and cash flow.

operations are also subject to many significant risks and uncertainties, as described, without limitation, in this “ Risk Factors ”

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including, without limitation, one or more of the following:

dedication of a substantial portion of our cash flows from operations to the payment of legal

or related expenses, resulting in these same funds being unavailable for other purposes,

including, without limitation, debt service, operations, capital expenditures, product development

and future business opportunities;

limitation in our ability to adjust to changing market conditions, causing us to be more

vulnerable to periods of negative or impaired growth in the general economy or in our business,

resulting the company being put at a competitive disadvantage as a result of a decreased

or unavailable ability to engage in capital spending and take all other actions that would

otherwise be required to ensure growth and competitiveness;

dedication of a substantial portion of our cash flows from operations to the payment of legal or related expenses, resulting in these

same funds being unavailable for other purposes, including, without limitation, debt service, operations, capital expenditures, product

development and future business opportunities;

limitation in our ability to adjust to changing market conditions, causing us to be more vulnerable to periods of negative or impaired

growth in the general economy or in our business, resulting in the Company being put at a competitive disadvantage as a result of a

decreased or unavailable ability to engage in capital spending and take all other actions that would otherwise be required to ensure

growth and competitiveness;

limitation in our ability to attract and retain key personnel;

decrement in our debt service and compliance obligations related to certain of our outstanding

debt obligations, exposing us to events of default and reduced credit ratings, which in turn

lead to increased capital costs and potential unavailability of capital and

decrement in our debt service and compliance obligations related to certain of our outstanding debt obligations, exposing us to events

of default and reduced credit ratings, which in turn lead to increased capital costs and potential unavailability of capital and

overall inability to fund our operations and liquidity needs.

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strategic alliances, or cost-saving initiatives.

Any refinancing of our substantial indebtedness could be at significantly higher interest

rates, which will depend on both the conditions of the market as well as the Company’s finances at such time, and may also require

our compliance with covenants that could be more onerous than current, which in turn could result in the further restriction of our business

Any refinancing of indebtedness could be at significantly higher interest rates, which

will depend on both the conditions of the market as well as the Company’s finances at such time, and may also require our compliance

with covenants that could be more onerous than current, which in turn could result in the further restriction of our business operations.

Any refinancing may also increase the amount of our secured indebtedness.

In addition, the terms of existing or future debt

agreements may restrict us from adopting any of the alternatives.

Internal reorganizations, restructuring activities, asset sales and

cost saving initiatives may also be complex and could entail significant costs and charges or could otherwise negatively impact shareholder

There can also be no assurance that we will be able to accomplish any of these alternatives on terms acceptable to us, or at all,

or that even if accomplished, that the intended results and benefits would be realized.

most likely will require additional financing to meet our business objectives.

most likely will need additional funding to accomplish our plans to conduct the clinical development and commercialization of a range

of multiple abuse-deterrent opioids or initiate, continue or complete the development of additional generic products already identified

for development or currently in development.

of March 31, 2025, we had cash on hand of approximately $11.3 million and a working capital surplus of $45.9 million, and for the year

ended March 31, 2025, we generated income from operations totaling $19.6 million, net other expenses totaling $19.7 million and a net

tax expense of $4.3 million, resulting in a net loss of $4.3 million.

growth in our current generic product line, consisting of Phentermine Tablets, Phendimetrazine Tablets, Naltrexone Tablets, Isradipine

Capsules, Trimipramine Capsules, Loxapine capsules, Amphetamine IR Tablets, Amphetamine ER Capsules, Methotrexate Tablets, APAP Codeine

Tablets, APAP Hydrocodone Tablets, Lisdex Capsules and successful commercialization of other products in our product development pipeline,

may lead to increased profitability, there can be no assurances of Elite increasing profits or achieving profitable operations in the

Furthermore, there can be no assurances of the continuation of revenues being earned from the current generic product line, nor Elite’s successful commercialization of other products in our development pipeline.

In addition, there can be no

assurances of Elite being able to raise additional funds in a timely manner, on acceptable terms, if needed to support commercial operations

resulting in a material detrimental effect on Elite’s operations and profits as well as having a material adverse effect on our

business, results of operations, financial condition, and cash flow.

sustain operations and meet our business objectives we must be able to commercialize our products and other products or pipeline opportunities.

If we are unable to timely obtain additional financing, if necessary, and/or we are unable to timely generate greater revenues from our

operations, we will be required to reduce and, possibly, cease operations and liquidate our assets.

No assurance can be given that we

will be able to commercialize the new opportunities or consummate such other financing or strategic alternative in the time necessary

to avoid the cessation of our operations and liquidation of our assets.

the capital and credit markets have experienced extreme volatility.

Disruptions in the credit markets make it harder and more expensive

to obtain funding.

In the event current resources do not satisfy our needs, we may have to seek additional financing.

The availability

of additional financing will depend on a variety of factors such as market conditions and the general availability of credit.

debt financing may not be available to us when required or may not be available on acceptable terms, and as a result we may be unable

to grow our business, take advantage of business opportunities, or respond to competitive pressures.

have substantial indebtedness which may adversely affect our financial condition.

currently have substantial indebtedness.

Total liabilities as of March 31, 2025, were $42.9 million, with such amount including, without

limitation, $10.9 million in various loans, leases, bonds payable and deferred revenues, $25.2 million in derivative liabilities and

$6.8 million in current payables and accruals.

The consequences of this substantial indebtedness could include:

to the risk of increased interest rates;

Company being required to dedicate a substantial portion of cash flow from operations for

debt service and the attendant result of a diminished ability to fund working capital, capital

expenditures and other expenses;

limitation in our flexibility in planning for, or reacting to, changes in our business and

the industry in which we operate;

being at a competitive disadvantage as compared to competitors with less indebtedness;

limitation in our ability to borrow additional funds that may be needed to operate and expand

our business.

addition, a notice of default was issued by the New Jersey Economic Development Authority in relation to prior obligations of our

tax-exempt bonds (the “NJEDA Bonds”).

Although we are current in our payments under these bonds, if the principal balances due under these bonds are

accelerated pursuant to the notice of default, our ability to operate in the future will be materially and adversely

more information on the NJEDA Bonds, see Part II, Item 7 “ Management’s Discussion and Analysis of Financial Condition

and Results of Operations;

Liquidity and Capital Resources;

NJEDA Bonds.”

In addition, the terms of existing or future debt agreements

may restrict us from adopting any of the alternatives.

Internal reorganizations, restructuring activities, asset sales and cost saving

initiatives may also be complex and could entail significant costs and charges or could otherwise negatively impact shareholder value.

There can also be no assurance that we will be able to accomplish any of these alternatives on terms acceptable to us, or at all, or

that even if accomplished, that the intended results and benefits would be realized.

is a risk of impairment of significant intangible assets on our balance sheet.

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material effect on our profitability.

assets represent a significant portion of our assets.

As of March 31, 2025, intangible assets were approximately $5.6 million, or approximately

6% of our assets.

accepted accounting principles in the United States (“GAAP”) requires that intangible assets be subject to regular

impairment analysis to determine if changes in circumstances indicate that the value of the asset as recorded may not be

Such events or changes in circumstances are an inherent risk in the pharmaceutical industry and often cannot be

However, should a change in circumstance occur, requiring the impairment of an intangible asset, the result of such an

impairment may have an adverse material effect on our business, financial condition, results of operations, cash flows and stock

During the years ended March 31, 2025 and 2024, we recorded impairment of approximately $1.6 million and $0.0 million,

respectively, related to our ANDA and patent intangible assets.

requires estimates, judgements and assumptions which inherently contain uncertainties.

assets represent a material asset on our balance sheet.

As of March 31, 2026, intangible assets were approximately $4.8 million.

accepted accounting principles in the United States (“GAAP”) requires that intangible assets be subject to regular impairment

analysis to determine if changes in circumstances indicate that the value of the asset as recorded may not be recoverable.

or changes in circumstances are an inherent risk in the pharmaceutical industry and often cannot be predicted.

However, should a change

in circumstance occur, requiring the impairment of an intangible asset, the result of such an impairment may have an adverse material

effect on our business, financial condition, results of operations, cash flows and stock price.

During the year ended March 31, 2026,

we recorded impairment of approximately $1 million related to our ANDA and patent intangible assets.

requires estimates, judgments and assumptions which inherently contain uncertainties.

are inherent uncertainties involved in estimates, judgments and assumptions used in the preparation of financial statements in accordance

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adverse events.

The FDA also can require companies to formulate approved (REMS) to help ensure

that a drug’s benefits outweigh its risks.

The FDA also can require companies to formulate approved (REMS) to help ensure that a drug’s benefits outweigh

may seek FDA approval for certain product candidates through the 505(b)(2) regulatory pathway.

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and financial condition.

at the FDA, the DEA, the SEC and other government agencies could negatively impact our business.

at, without limitation, the FDA, the DEA, and other regulatory agencies, including

due to changes in government or significant changes in leadership or personnel, could increase the time required for new products to

be reviewed and approved, or otherwise cause delays to the regulatory approval or post-approval processes for our products, which could

adversely affect our business.

The ability of the FDA, the DEA or other regulatory agencies to review and approve new products or manage

post-approval requirements for marketed products can be affected by a variety of factors, including government budget and funding levels,

ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, political and policy changes.

Average review times for product submissions have fluctuated in recent years as a result.

In addition, government funding of the SEC

and other government agencies on which our operations may rely is subject to the impacts of political events, which are inherently fluid

and unpredictable.

example, over the last several years, the U.S.

government has shut down several times, including the fall of 2025, and certain regulatory

agencies, such as the FDA, the DEA and the SEC, have had to furlough critical employees and stop critical

If a prolonged government shutdown occurs, or if other global, political or economic conditions impact the regulatory agencies

with which we interact, it could significantly impact the ability of the FDA, the DEA, the SEC and other agencies to timely review and

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

business may be adversely affected by legislation or healthcare regulatory reform and initiatives.

business and financial condition may be adversely affected by legislation or regulatory reform of the healthcare system in the United

We cannot predict with any certainty how existing laws may be applied or how laws or legal standards may change in the future.

Current or future legislation, whether state or federal, or in any of the non-U.S.

jurisdictions with authority over our suppliers, customers

or operations, may have a material effect on our business, ability to operate, financial condition, results of operations and cash flows.

may seek to reduce costs by reducing or eliminating employer group healthcare plans or by transferring a greater portion of their healthcare

costs to their employees.

Job losses, or other economic hardships may also result in reduced levels of coverage for some individuals,

potentially resulting in lower healthcare coverage for themselves or their families.

Furthermore, increased instability in the insurance

marketplace or an increase in uninsured Americans or others living and working in the USA may result from the Tax Cuts and Jobs Act of

2017, elimination of the Tax Cuts and Jobs Act of 2017, elimination of the Patient Protection and Affordable Care Act (“PPACA”)

requirement that individuals maintain health insurance or incur a financial penalty and other steps taken by various governmental and

other organizations to limit or end subsidies to such individuals at comparatively lower income levels.

These economic conditions may

affect an individual’s ability to afford healthcare as a result of increased premiums, co-pay or deductible obligations, greater

cost sensitivity to existing co-pay or deductible obligations, lost healthcare coverage or for other reasons.

It is possible that such

conditions could lead to changes in patient behavior and spending patterns that could negatively affect prescription and usage of certain

or all of our products, including, without limitation, delaying of treatment, rationing of prescription medications, non-filling of prescriptions,

reduction in the frequency of visits to healthcare facilities, utilizing alternative therapies or foregoing healthcare insurance coverage

Such changes may result in the reduced demand for any or all of our products, which could have a material adverse effect

on our business, results of operations, financial condition, cash flows and ability to operate as a going concern.

our ability to commercialize and generate revenues and profit splits relating to the sale of our products depends, in part, on the extent

to which reimbursement for the costs of these products is available from third-party payors, including government healthcare programs,

such as Medicaid and Medicare, private health insurers and other payors.

We cannot be certain that, over time, third-party reimbursements

for our products will be adequate for us to maintain price levels sufficient for realization of an appropriate return on our investment.

Government payers, private insurers and other third-party payers are increasingly attempting to contain healthcare costs by:

both coverage and the level of reimbursement (including adjusting co-pays) for drugs, (ii) refusing, in some cases, to provide any coverage

for certain uses for drugs, (iii) requiring rebates, in the case of government healthcare programs, for net sales amounts above statutorily

defined ceilings, with such ceilings being potentially below production costs and (iv) requiring or encouraging, through more favorable

reimbursement levels or otherwise, the substitution of generic alternatives to branded drugs.

For example, government agencies or third-party

payers could attempt to reduce reimbursement for physician administered products through their interpretation of complex government price

reporting obligations and payment and reimbursement coding rules, and could attempt to reduce reimbursement for separate physician administered

products that share an active ingredient by requiring the blending of sales and pricing information in the same payment and reimbursement

unavailability of, or reduction in, the reimbursement of our products could have a material adverse effect on our business, ability to

operate as a going concern, financial condition, results of operations and cash flow.

have been, and there will continue to be, legislative, regulatory and third-party payor proposals to change the healthcare system in

ways that could impact our ability to commercialize our products profitably.

We anticipate that the federal and state legislatures and

the private sector will continue to consider and may adopt and implement healthcare policies, such as the IRA and the Patient Protection

and Affordable Care Act enacted in 2010 (“ACA”), intended to curb rising healthcare costs.

These cost-containment measures

may include, among other measures:

requirements for pharmaceutical companies to negotiate prescription drug prices with government healthcare

controls on government-funded reimbursement for drugs;

new or increased requirements to pay prescription drug rebates to government

healthcare programs, including if drug prices increase at a higher rate than inflation;

controls on healthcare providers;

to or limits on the pricing of drugs, including pricing controls or limits or prohibitions on reimbursement for specific products through

requirements to try less expensive products or generics before a more expensive branded product;

and public funding for

cost effectiveness research, which may be used by government and private third-party payors to make coverage and payment decisions.

example, the ACA includes numerous provisions that affect pharmaceutical companies, including provisions intended to expand healthcare

coverage to the uninsured through private health insurance reforms and an expansion of Medicaid.

The ACA also imposes substantial costs

on pharmaceutical manufacturers, such as an increase in liability for rebates paid to Medicaid, new drug discounts that must be offered

to certain enrollees in the Medicare prescription drug benefit and an annual fee imposed on all manufacturers of brand prescription drugs

The ACA also requires increased disclosure obligations and an expansion of an existing program requiring pharmaceutical discounts

to certain types of hospitals and federally subsidized clinics and contains cost-containment measures that could reduce reimbursement

levels for pharmaceutical products.

The ACA also includes provisions known as the Physician Payments Sunshine Act, which require manufacturers

of drugs, biologics, devices and medical supplies covered under Medicare and Medicaid to record any transfers of value to certain U.S.

healthcare providers (including, but not limited to, physicians, physician assistants, nurse practitioners, dentists, optometrists, podiatrists,

chiropractors and other healthcare providers) and teaching hospitals and to report this data to the CMS annually for subsequent public

Similar reporting requirements have also been enacted on the state level domestically, and an increasing number of countries

worldwide either have adopted or are considering similar laws requiring transparency of interactions with healthcare professionals.

to report appropriate data may result in civil or criminal fines and/or penalties.

addition, the IRA contains provisions intended to lower beneficiary drug spending.

The IRA enables Medicare to negotiate prescription

drug prices with manufacturers of certain high-cost drugs for the first time.

A separate provision requires drug manufacturers to pay

rebates to Medicare if their drug prices increase at a higher rate than the rate of inflation (the so-called inflation rebate provision).

Additionally, beginning in 2024, the IRA eliminated the 5% coinsurance for catastrophic coverage under Medicare Part D;

the IRA capped the beneficiary annual out-of-pocket expenditure and required new mandatory manufacturer discounts.

Since its enactment,

CMS has taken steps to implement various provisions of the IRA, including negotiating and publishing maximum fair prices for drugs selected

under the IRA’s negotiation framework.

The ultimate impact of the IRA’s drug pricing provisions on the pharmaceutical industry,

including on pricing, reimbursement, and market dynamics, remains uncertain.

and regulatory efforts to implement drug pricing reforms, including MFN models, can adversely affect our business, if implemented.

These reforms

create uncertainty for our business, and they remain subject to change through potential legal challenges or subsequent rulemaking or

sub-regulatory guidance.

While we are unable to predict whether any pending or future reforms may be adopted, if such reforms are adopted

they could lower our pricing, which would have a material negative impact on our competitive position in the market, our sales levels

and our profitability.

addition, while we are not currently engaged in clinical trials at this time, if that changes and we are unable to adapt to changes in

existing requirements or the adoption of new requirements or policies governing clinical trials, our development plans may be impacted.

For example, in December 2022, with the passage of Food and Drug Omnibus Reform Act (“FDORA”), Congress required sponsors

to develop and submit a Diversity Action Plan (“DAP”) for each Phase 3 clinical trial or any other “pivotal study”

of a new drug or biological product.

These plans are meant to encourage the enrollment of more diverse patient populations in late-stage

clinical trials of FDA-regulated products.

In June 2024, as mandated by FDORA, the FDA issued draft guidance outlining the general requirements

Unlike most guidance documents issued by the FDA, the DAP guidance when finalized will have the force of law because FDORA

specifically dictates that the form and manner for submission of DAPs are specified in FDA guidance.

In January 2025, in response to

an Executive Order issued by the President of the United States on Diversity, Equity and Inclusion programs, the FDA removed this draft

guidance from its website.

This action raises questions about the applicability of statutory obligations to submit DAPs and the agency’s

current thinking on best practices for clinical development.

new laws or regulations that have the effect of imposing additional costs or regulatory burden on pharmaceutical manufacturers, or otherwise

negatively affect the industry, could adversely affect our ability to successfully commercialize our products and any future product

candidates, if approved.

The implementation of any price controls, caps on prescription drugs or price transparency requirements, whether at the federal

level or state level, could have a material adverse effect on our business, ability to operate as a going concern, financial condition,

results of operations and cash flow.

of generics may be limited through legislative, regulatory or efforts of pharmaceutical companies.

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These efforts have included:

new patents for existing products which may be granted just before the expiration of earlier

patents, which could extend patent protection for additional years;

new patents for existing products which may be granted just before the expiration of earlier patents, which could extend patent protection

for additional years;

the Citizen Petition process (for example, under 21 C.F.R.

Sections 10.30) to request amendments

to FDA standards;

to use the legislative and regulatory process to have drugs reclassified or rescheduled or

to set definitions of abuse-deterrent formulations to protect patents and profits;

in state-by-state initiatives to enact legislation that restricts the substitution of some

generic drugs.

Sections 10.30) to request amendments to FDA standards;

to use the legislative and regulatory process to have drugs reclassified or rescheduled or to set definitions of abuse-deterrent

formulations to protect patents and profits;

in state-by-state initiatives to enact legislation that restricts the substitution of some generic drugs.

changes to U.S.

Pharmacopeia, an organization that publishes industry recognized compendia

of drug standards;

Pharmacopeia, an organization that publishes industry recognized compendia of drug standards;

patent extension amendments to non-related federal legislation;

regulatory bodies to withdraw the approval of brand-name drugs for which the patents are

about to expire and converting the market to another product of the brand company on which

longer patent protection exists;

into agreements whereby other generic companies will begin to market an authorized generic

at the same time or after generic competition initially enters the market;

suits for patent infringement and other claims that may delay or prevent regulatory approval,

manufacture and/or scale of generic products;

● Introducing

“next generation” products prior to the expiration of market exclusivity for

the reference product, which often materially reduces demand for the generic or the reference

product for which we seek regulatory approval for a generic equivalent.

regulatory bodies to withdraw the approval of brand-name drugs for which the patents are about to expire and converting the market

to another product of the brand company on which longer patent protection exists;

into agreements whereby other generic companies will begin to market an authorized generic at the same time or after generic competition

initially enters the market;

suits for patent infringement and other claims that may delay or prevent regulatory approval, manufacture and/or scale of generic

“next generation” products prior to the expiration of market exclusivity for the reference product, which often materially

reduces demand for the generic or the reference product for which we seek regulatory approval for a generic equivalent.

pharmaceutical companies or other third parties are successful in limiting the use of generic products through these or other means,

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revenues and profits from generic products may decline as a result of changes in regulatory policy.

IRA contains substantial drug pricing reforms, including the establishment of a drug price negotiation program within the HHS that

would require manufacturers to charge a negotiated “maximum fair price” for certain selected drugs or pay an excise tax

for noncompliance, the establishment of rebate payment requirements on manufacturers of certain drugs payable under Medicare Parts B

and D to penalize price increases that outpace inflation, and requires manufacturers to provide discounts on Part D drugs.

Substantial penalties can be assessed for noncompliance with the drug pricing provisions.

IRA contains substantial drug pricing reforms, including the establishment of a drug price negotiation program within the HHS that would

require manufacturers to charge a negotiated “maximum fair price” for certain selected drugs or pay an excise tax for noncompliance,

the establishment of rebate payment requirements on manufacturers of certain drugs payable under Medicare Parts B and D to penalize price

increases that outpace inflation, and requires manufacturers to provide discounts on Part D drugs.

Substantial penalties can be assessed

for noncompliance with the drug pricing provisions.

with an available generic or biosimilar, certain drugs that represent a limited portion of Medicare program spending, drugs with an orphan

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non-compliant manufacturers or those who refuse to negotiate.

IRA also imposes rebate requirements on manufacturers of single-source generics and other drugs covered under Medicare Part B and

Part D where the price of the drug increases faster than inflation.

Multisource generics and all products with an average

manufacturer’s price of less than $100 per year, per individual, are exempt from rebate requirements.

Beginning on October 1,

2022 for Part D products and on January 1, 2023 for Part B products, CMS will monitor for products with price increases higher than

the rate of inflation on a quarterly basis.

Rebates will be calculated as the total number of units sold by the amount the product

exceeds the inflation-adjusted price, with 2021 as the base year to measure cumulative changes relative to inflation.

manufacturers will be subject to a civil monetary penalty of at least 125% of the calculated rebate amount.

IRA also imposes rebate requirements on manufacturers of single-source generics and other drugs covered under Medicare Part B and Part

D where the price of the drug increases faster than inflation.

Multisource generics and all products with an average manufacturer’s

price of less than $100 per year, per individual, are exempt from rebate requirements.

Beginning on October 1, 2022 for Part D products

and on January 1, 2023 for Part B products, CMS will monitor for products with price increases higher than the rate of inflation on a

quarterly basis.

Rebates will be calculated as the total number of units sold by the amount the product exceeds the inflation-adjusted

price, with 2021 as the base year to measure cumulative changes relative to inflation.

Noncompliant manufacturers will be subject to

a civil monetary penalty of at least 125% of the calculated rebate amount.

effect of the IRA on our business, generic manufacturers, and the pharmaceutical industry in general is not yet known.

May 12, 2025, President Trump issued an executive order implementing the concept of most-favored nation pricing.

May 12, 2025, President Trump issued an executive order implementing the concept of MFN pricing.

Under this order, the

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countries for medications covered by such insurers, including Medicare and Medicaid.

Under the order, most-favored nation pricing will

Under the order, MFN pricing will

apply only to brand products without generic or biosimilar competition.

The effect of this order on our business and the pharmaceutical

The effect of this order on our business and the generic pharmaceutical

industry in general is not yet known.

tariffs and evolving trade policy between the US and other countries may adversely affect our business.

tariffs, evolving trade policy, and geopolitical factors and military conflicts between the US and other countries may adversely affect our business.

tariffs and evolving trade policy between the United States and other countries, including China and Mexico, may have an adverse effect

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causing us to raise prices or make changes to our products.

Further, the continued threats of tariffs, trade restrictions, retaliatory actions and trade barriers

could have a generally disruptive impact on the global economy and, therefore, negatively impact our sales.

Given the volatility and

uncertainty regarding the scope and duration of these tariffs and other aspects of U.S.

international trade policy, the impact on our

operations and results is uncertain and could be significant.

Further governmental action related to tariffs, additional taxes, regulatory

changes or other retaliatory trade measures could occur in the future.

Any of these factors could have a material adverse effect on our

business, financial condition, results of operations and cash flows.

Further, the continued threats of tariffs, trade restrictions, retaliatory

actions and trade barriers could have a generally disruptive impact on the global economy and, therefore, negatively impact our sales.

Given the volatility and uncertainty regarding the scope and duration of these tariffs and other aspects of U.S.

international trade

policy, the impact on our operations and results is uncertain and could be significant.

Further governmental action related to tariffs,

additional taxes, regulatory changes or other retaliatory trade measures could occur in the future.

Any of these factors could have a

material adverse effect on our business, financial condition, results of operations and cash flows.

Further, recent global

events may adversely affect workforces, organizations, economies, and financial markets globally, leading to economic downturns, inflation,

and increased market volatility.

Military conflicts and wars (such as the ongoing conflicts between the US and Iran, Russia and Ukraine,

and Israel and Hamas), terrorist attacks, other geopolitical events, high inflation, increasing interest rates, bank failures and associated

financial instability and crises, and supply chain and logistics issues can cause exacerbated volatility and disruptions to various aspects

of the global economy.

The uncertain nature, magnitude, and duration of hostilities stemming from such conflicts, including the potential

effects of sanctions and counter-sanctions, or retaliatory cyber-attacks on the world economy and markets, have contributed to increased

market volatility and uncertainty, which could have an adverse impact on macroeconomic factors that affect our business and operations.

DEA could limit the availability of active ingredients used in many of our products.

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received a CRL from the FDA indicating that the SequestOx™ NDA is not ready for approval .

received a CRL from the FDA that indicated that our SequestOx™ NDA is not ready for approval in its present

We have paused further development of this product and we cannot assure that development will restart.

If we are unable to obtain

approval for SequestOx™ or if we incur significant costs or delays in obtaining such approval, our return on investment in SequestOx™

will be materially adversely affected.

received a CRL from the FDA that indicated that our SequestOx™ NDA is not ready for approval in its present form.

We have paused

further development of this product and we cannot assure that development will restart.

If we are unable to obtain approval for SequestOx™

or if we incur significant costs or delays in obtaining such approval, our return on investment in SequestOx™ will be materially

adversely affected.

July 2016, the FDA issued a Complete Response Letter, or CRL, regarding the NDA.

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with review of such agreements by the U.S.

Federal Trade Commission (the “FTC”) and the Antitrust Division of the DOJ being required by law.

The FTC has stated publicly its view that some of these settlement agreements

violate antitrust laws and has commenced actions against the branded and generic companies that are parties to these agreements.

in the event of the Company being party to a settlement agreement, either as the branded, innovator product owner, or as the generic

applicant, we may receive formal or informal requests from the FTC for information about a settlement agreement and there is a risk of

the FTC or DOJ alleging a violation of antitrust laws and commencing an action against us.

Federal Trade Commission (the “FTC”) and the Antitrust Division of the DOJ being

required by law.

The FTC has stated publicly its view that some of these settlement agreements violate antitrust laws and has commenced

actions against the branded and generic companies that are parties to these agreements.

Accordingly, in the event of the Company being

party to a settlement agreement, either as the branded, innovator product owner, or as the generic applicant, we may receive formal or

informal requests from the FTC for information about a settlement agreement and there is a risk of the FTC or DOJ alleging a violation

of antitrust laws and commencing an action against us.

such action could have an adverse effect on the Company’s business, operations and financial condition.

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and sanctions which could have a material adverse effect on our business.

regulations applicable to us regarding reporting and payment obligations with respect to Medicaid reimbursement and rebates and other

governmental programs are complex.

Our calculations and methodologies are subject to review and challenge by the applicable governmental

agencies, and it is possible that such reviews could adversely affect us and our business.

In addition, because our processes for these

calculations and the judgments involved in making these calculations involve, and will continue to involve, subjective decisions and

complex methodologies, these calculations are subject to the risk of error and misjudgment.

Any governmental agencies that have commenced

(or that may commence) an investigation of us could impose, based on a claim of violation of anti - fraud and false claims laws

or otherwise, civil and/or criminal sanctions, including fines, penalties and possible exclusion from federal health care programs (including

Medicaid and Medicare).

Some of the applicable laws may impose liability even in the absence of specific intent to defraud.

should there be ambiguity with respect to how to properly calculate and report payments, and even in the absence of any such ambiguity,

a governmental authority may take a position contrary to a position that we have taken and may impose civil and/or criminal sanctions

Any such penalties, sanctions, or exclusion from federal health care programs could have a material adverse effect on our business,

financial position, results of operation, ability to operate and stock price.

participate in, without limitation, the Medicaid Drug Rebate Program, the 340B program, the U.S.

Department of Veterans Affairs’

FSS pricing program and other governmental purchasing and rebate programs and have obligations to report the average sales price for

certain of our drugs.

and rebate calculations vary across products and programs, are complex and are often subject to interpretations by us, governmental or

regulatory agencies and the courts, which can change and evolve over time.

In the case of our Medicaid pricing data, if we become aware

that our reporting for a prior quarter was incorrect, or has changed as a result of recalculation of the pricing data, we are generally

obligated to resubmit the corrected data for up to three years after those data were originally due.

Such restatements and recalculations

increase our costs for complying with the laws and regulations governing the Medicaid Drug Rebate Program and could result in an adjustment

to our rebate liability for past quarters.

Price recalculations also may affect the ceiling price at which we are required to offer our

products under the 340B program and give rise to an obligation to refund entities participating in the 340B program for overcharges during

past quarters by a price recalculation.

monetary penalties can be applied if we are found to have knowingly submitted any false price or product information to the government,

if we are found to have made a misrepresentation in the reporting of our average sales price, if we fail to submit the required price

data on a timely basis, or if we are found to have charged 340B covered entities more than the statutorily mandated ceiling price.

could also decide to terminate our Medicaid drug rebate agreement, in which case federal payments may not be available under Medicaid

or Medicare Part B for our covered outpatient drugs.

We cannot assure you that our submissions will not be found by CMS to be incomplete

or incorrect.

failure to comply with our reporting and payment obligations under the Medicaid Drug Rebate Program and other governmental programs could

negatively impact our financial results.

CMS issued a final regulation, which became effective in April 2016, to implement the changes

to the Medicaid Drug Rebate Program under the Affordable Care Act.

Since that time, CMS has issued multiple proposed and final rules

that change the Medicaid Drug Rebate Program.

Regulatory and legislative changes, and judicial rulings relating to the Medicaid Drug

Rebate Program and related policies have increased and will continue to increase our costs and the complexity of compliance, have been

and will continue to be time-consuming to implement, and could have a material adverse effect on our results of operations, particularly

if CMS or another agency challenges the approach we take in our implementation.

Health Resources and Service Administration (“HRSA”)

issued a final regulation regarding the calculation of the 340B ceiling price and the imposition of civil monetary penalties on manufacturers

that knowingly and intentionally overcharge covered entities, which became effective in January 2019.

Implementation

of this regulation could affect our obligations and potential liability under the 340B program in ways we cannot anticipate.

required to report the 340B ceiling prices for our covered outpatient drugs to HRSA, which then publishes them to 340B covered entities.

Any charge by HRSA that we have violated this regulation or other requirements of the program could negatively impact our financial results.

Moreover, HRSA has established an administrative dispute resolution (“ADR”) process, which is governed by a final regulation

effective June 2024, for claims by covered entities that a manufacturer engaged in overcharging, including claims that a manufacturer

limited the ability of a covered entity to purchase the manufacturer’s drugs at the 340B ceiling price, and by manufacturers that

a covered entity violated the prohibitions against diversion or duplicate discounts.

Such claims are to be resolved through an ADR panel

of government officials rendering a decision that could be appealed only in federal court.

An ADR proceeding could potentially subject

us to discovery by covered entities and other onerous procedural requirements and could result in additional liability.

HRSA could also

decide to terminate a manufacturer’s agreement to participate in the 340B program for a violation of that agreement or other good

cause shown, in which case the manufacturer’s covered outpatient drugs may no longer be eligible for federal payment under the

Medicaid or Medicare Part B program.

legislation may be introduced that, if passed, would, among other things, further expand the 340B program to include additional

covered entities or would require participating manufacturers to agree to provide 340B discounted pricing on drugs used in an

inpatient setting, and any additional future changes to the definition of average manufacturer price or the Medicaid rebate amount

could affect our 340B ceiling price calculations and negatively impact our results of operations.

Additionally, we have implemented

a policy governing the eligibility of covered entities to purchase our products at the 340B price for shipment to a contract

We implemented this policy out of concern that contract pharmacy arrangements are diverting the benefits of the 340B

program from patients to contract pharmacies and contributing to the pervasive lack of transparency within the 340B program,

rendering it difficult to identify inappropriate duplicate discounts and product diversion.

Certain pharmaceutical manufacturers and

the industry group, Pharmaceutical Research and Manufacturers of America (“PhRMA”) are involved in ongoing litigation

with the HRSA regarding manufacturer initiatives that restrict covered entities’ ability to purchase products at the 340B

program price for shipment through an unlimited number of contract pharmacies.

Additionally, several states have enacted, and many

other states are considering, laws that prohibit manufacturer restrictions on contract pharmacies.

Certain pharmaceutical

manufacturers and PhRMA have initiated litigation challenging these state laws.

The outcome of pending judicial proceedings and the

potential impact on the way in which manufacturers extend discounts to covered entities through contract pharmacies remain uncertain

and negative legal rulings, or the passage of legislation in respect of this topic, may materially adversely impact our results of

have obligations to report the average sales price for certain of our drugs to the Medicare program.

In addition, we are required to

report the best price for our drugs, as defined under the Medicaid Drug Rebate Program, to CMS.

Statutory or regulatory changes or changes

in CMS guidance could affect the average sales price or best price calculations for our products and the resulting Medicare payment rate

or rebates we owe to state Medicaid programs.

Such changes could negatively impact our results of operations.

to applicable law, knowing provision of false information in connection with price reporting under the U.S.

Department of Veterans Affairs,

FSS or Tricare programs can subject a manufacturer to civil monetary penalties.

These program obligations also contain extensive disclosure

and certification requirements.

If we overcharge the government in connection with our arrangements with FSS or Tricare, we are required

to refund the difference to the government.

Failure to make necessary disclosures and/or to identify contract overcharges can result

in allegations against us under the False Claims Act and other laws and regulations.

Unexpected refunds to the government, and responding

to a government investigation or enforcement action, would be expensive and time-consuming, and could have a material adverse effect

on our business, financial condition, results of operations and growth prospects.

Investigations

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cost of insurance, including directors and officers insurance, workers compensation, product liability for products containing opioids

and products not containing opioids, truck and general liability insurance have increase significantly in recent years and may continue

and products not containing opioids, truck and general liability insurance have increased significantly in recent years and may continue

to increase in the future.

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of patent infringement have not been finally resolved by the courts.

The risk involved in doing so can be substantial because the

remedies available to the owner of a patent for infringement include, among other things, damages measured by the profits lost by the

patent owner and not by the profits earned by the infringer.

In the case of a willful infringement, the definition of which is subjective,

such damages may be trebled.

Moreover, because of the discount pricing typically involved with bioequivalent products, patented brand

products generally realize a substantially higher profit margin than bioequivalent products.

An adverse decision in a case such as this

or in other similar litigation could have a material adverse effect on our business, financial position and results of operations and

could cause the market value of our Common Stock to decline.

The risk involved in doing so can be substantial because the remedies

available to the owner of a patent for infringement include, among other things, damages measured by the profits lost by the patent owner

and not by the profits earned by the infringer.

In the case of a willful infringement, the definition of which is subjective, such damages

may be trebled.

Moreover, because of the discount pricing typically involved with bioequivalent products, patented brand products generally

realize a substantially higher profit margin than bioequivalent products.

An adverse decision in a case such as this or in other similar

litigation could have a material adverse effect on our business, financial position and results of operations and could cause the market

value of our Common Stock to decline.

we are found liable in any lawsuits, including patent infringement, violation of proprietary rights, product liability claims or actions

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the subject of off-label uses of drug products by pharmaceutical companies.

The FDA, FTC, the Office of the Inspector General of the HHS, the DOJ and various state Attorneys General actively enforce laws and regulations

that prohibit the promotion of off-label uses.

A company that is found to have improperly promoted off-label uses may be subject to significant

liability, including civil fines, criminal fines and penalties, civil damages, exclusion from federal funded healthcare programs and

potential liability under the federal False Claims Act and any applicable state false claims act.

Conduct giving rise to such liability

could also form the basis for private civil litigation by third-party payers or other persons claiming to be harmed by such conduct.

The FDA, FTC, the Office of the Inspector General of the

HHS, the DOJ and various state Attorneys General actively enforce laws and regulations that prohibit the promotion of off-label uses.

A company that is found to have improperly promoted off-label uses may be subject to significant liability, including civil fines, criminal

fines and penalties, civil damages, exclusion from federal funded healthcare programs and potential liability under the federal False

Claims Act and any applicable state false claims act.

Conduct giving rise to such liability could also form the basis for private civil

litigation by third-party payers or other persons claiming to be harmed by such conduct.

Notwithstanding

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These laws and regulations are interpreted and enforced by various federal, state and local authorities including

CMS, the Office of Inspector General for the HHS, DOJ, individual

Attorney offices within the Department of Justice, and state and local governments.

CMS, the Office of Inspector General for the HHS, DOJ, individual U.S.

Attorney offices within the Department of Justice, and state and

local governments.

These laws include:

federal Anti-Kickback Statute, which prohibits, among other things, persons or entities

from knowingly and willfully soliciting, offering, receiving or paying any remuneration,

directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward either

the referral of an individual for, or the purchase, lease, order, or arranging for or recommending

the purchase, lease or order of, any good or service, for which payment may be made, in whole

or in part, under federal healthcare programs such as Medicare and Medicaid.

entity does not need to have actual knowledge of the statute or specific intent to violate

it in order to have committed a violation

civil False Claims Act (which can be enforced through “qui tam,” or whistleblower

actions, by private citizens on behalf of the federal government and impose civil and criminal

penalties), prohibits any person from, among other things, knowingly presenting, or causing

to be presented false or fraudulent claims for payment of government funds or knowingly making,

using or causing to be made or used, a false record or statement material to an obligation

to pay money to the government or knowingly and improperly avoiding, decreasing or concealing

an obligation to pay money to the U.S.

federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from knowingly and willfully soliciting,

offering, receiving or paying any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward

either the referral of an individual for, or the purchase, lease, order, or arranging for or recommending the purchase, lease or

order of, any good or service, for which payment may be made, in whole or in part, under federal healthcare programs such as Medicare

and Medicaid.

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

civil False Claims Act (which can be enforced through “qui tam,” or whistleblower actions, by private citizens on

behalf of the federal government and impose civil and criminal penalties), prohibits any person from, among other things, knowingly

presenting, or causing to be presented false or fraudulent claims for payment of government funds or knowingly making, using or causing

to be made or used, a false record or statement material to an obligation to pay money to the government or knowingly and improperly

avoiding, decreasing or concealing an obligation to pay money to the U.S.

federal government;

● HIPAA, which imposes

criminal liability and amends provisions on the reporting, investigation, enforcement, and

penalizing of civil liability for, among other things, knowingly and willfully executing,

or attempting to execute, a scheme to defraud any healthcare benefit program, or knowingly

and willfully falsifying, concealing or covering up a material fact or making any materially

false statement, in connection with the delivery of, or payment for healthcare benefits,

items or services by a healthcare benefit program, which includes both government and privately

funded benefits programs;

which imposes criminal liability and amends provisions on the reporting, investigation, enforcement, and penalizing of civil liability

for, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit

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

in connection with the delivery of, or payment for healthcare benefits, items or services by a healthcare benefit program, which

includes both government and privately funded benefits programs;

similar to the U.S.

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;

as amended by HITECH, and its implementing regulations, which also imposes obligations, including mandatory

contractual terms, with respect to safeguarding the privacy, security and transmission of

individually identifiable health information without appropriate authorization by covered

entities subject to the rule, such as health plans, healthcare clearinghouses and healthcare

providers as well as their business associates and their subcontractors that perform certain

services for or on their behalf involving the use or disclosure of individually identifiable

health information;

laws and regulations, including state anti-kickback and false claims laws, that may apply

to our business practices, including but not limited to, research, distribution, sales and

marketing arrangements and claims involving healthcare items or services reimbursed by any

third-party payer, including private insurers;

state laws that require pharmaceutical companies

to comply with the pharmaceutical industry’s voluntary compliance guidelines and the

relevant compliance guidance promulgated by the U.S.

federal government, or otherwise restrict

payments that may be made to healthcare providers and other potential referral sources;

state laws and regulations that require drug manufacturers to file reports relating to pricing

and marketing information, which requires tracking gifts and other remuneration and items

of value provided to healthcare professionals and entities;

Physician Payments Sunshine Act, implemented as the Open Payments program, and its implementing

regulations, requires certain manufacturers of drugs, devices, biologics and medical supplies

that are reimbursable under Medicare, Medicaid, or the Children’s Health Insurance

Program to report annually to CMS information related to certain payments made in the preceding

calendar year and other transfers of value to physicians and teaching hospitals, as well

as ownership and investment interests held by physicians and their immediate family members;

beginning in 2022, applicable manufacturers are required to report such information regarding

payments and transfers of value provided, as well as ownership and investment interests held,

during the previous year to physician assistants, nurse practitioners, clinical nurse specialists,

certified nurse anesthetists, and certified nurse-midwives;

● the FCPA, which generally prohibits offering, promising,

giving, or authorizing others to give anything of value, either directly or indirectly, to

government official in order to influence official action, or otherwise obtain

or retain business.

The FCPA also requires public companies to make and keep books and records

that accurately and fairly reflect the transactions of the corporation and to devise and

maintain an adequate system of internal accounting controls.

Our industry is heavily regulated

and therefore involves significant interaction with public officials, including officials

Additionally, in many other countries, the health care providers

who prescribe pharmaceuticals are employed by their government, and the purchasers of pharmaceuticals

are government entities;

therefore, our dealings with these prescribers and purchasers are

subject to regulation under the FCPA.

Recently, the SEC and DOJ have increased

their FCPA enforcement activities with respect to pharmaceutical companies.

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;

as amended by HITECH, and its implementing regulations, which also imposes obligations, including mandatory contractual terms, with

respect to safeguarding the privacy, security and transmission of individually identifiable health information without appropriate

authorization by covered entities subject to the rule, such as health plans, healthcare clearinghouses and healthcare providers as

well as their business associates and their subcontractors that perform certain services for or on their behalf involving the use

or disclosure of individually identifiable health information;

laws and regulations, including state anti-kickback and false claims laws, that may apply to our business practices, including but

not limited to, research, distribution, sales and marketing arrangements and claims involving healthcare items or services reimbursed

by any third-party payer, including private insurers;

state laws that require pharmaceutical companies to comply with the pharmaceutical

industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S.

federal government,

or otherwise restrict payments that may be made to healthcare providers and other potential referral sources;

and state laws and

regulations that require drug manufacturers to file reports relating to pricing and marketing information, which requires tracking

gifts and other remuneration and items of value provided to healthcare professionals and entities;

Physician Payments Sunshine Act, implemented as the Open Payments program, and its implementing regulations, requires certain manufacturers

of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid, or the Children’s Health

Insurance Program to report annually to CMS information related to certain payments made in the preceding calendar year and other

transfers of value to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their

immediate family members;

beginning in 2022, applicable manufacturers are required to report such information regarding payments

and transfers of value provided, as well as ownership and investment interests held, during the previous year to physician assistants,

nurse practitioners, clinical nurse specialists, certified nurse anesthetists, and certified nurse-midwives;

FCPA, which generally prohibits offering, promising, giving, or authorizing others to give anything of value, either directly or

indirectly, to a non-U.S.

government official in order to influence official action, or otherwise obtain or retain business.

FCPA also requires public companies to make and keep books and records that accurately and fairly reflect the transactions of the

corporation and to devise and maintain an adequate system of internal accounting controls.

Our industry is heavily regulated and

therefore involves significant interaction with public officials, including officials of non-U.S.

Additionally, in many

other countries, the health care providers who prescribe pharmaceuticals are employed by their government, and the purchasers of

pharmaceuticals are government entities;

therefore, our dealings with these prescribers and purchasers are subject to regulation

under the FCPA.

Recently, the SEC and DOJ have increased their FCPA enforcement activities with respect to pharmaceutical companies.

of any of these laws or any other governmental regulations that may apply to us, may subject us to significant civil, criminal and administrative

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on our business, results of operations and financial condition.

competitors or other third parties may allege that we are infringing upon their IP, forcing us

to expend substantial resources in litigation, the outcome of which is uncertain.

Any unfavorable outcome of such litigation, including,

without limitation, losses related to “at-risk” product launches, could have a material effect our business, financial position

and results of operations.

competitors or other third parties may allege that we are infringing upon their IP, forcing us to expend substantial resources in litigation,

the outcome of which is uncertain.

Any unfavorable outcome of such litigation, including, without limitation, losses related to “at-risk”

product launches, could have a material effect our business, financial position and results of operations.

that produce branded pharmaceutical products routinely bring litigation against ANDA filers or similar applicants that seek regulatory

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Property Related Risks

ability to protect intellectual property rights and successfully defend against third-party allegations of IP infringement is vital

to our business and uncertain.

ability to protect intellectual property rights and successfully defend against third-party allegations of IP infringement is vital to

our business and uncertain.

success depends on our ability to protect our current and future products and to defend our IP rights.

to protect our intellectual property adequately, competitors may manufacture and market products similar to ours.

currently hold three patents and we may intend to file further patent applications in the future.

If we fail to protect our intellectual

property adequately, competitors may manufacture and market products similar to ours.

currently hold two patents and we may intend to file further patent applications in the future.

We cannot be certain that any further

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Related to our Common Shares

from issuance of shares to Directors, Officers, Employees, Consultants or upon exercise of warrants and options or the perception

that dilution may occur could cause the price per share of common stock to fall.

of March 31, 2025, there were outstanding warrants to purchase an aggregate of approximately 79.0 million shares of Common Stock at

a cash exercise price of $0.1521 per share and vested options to purchase an aggregate of approximately 9.1 million shares at a

weighted average cash exercise price of $0.05.

Additional shares of Common Stock may be issuable as a result of anti-dilution

provisions in the outstanding warrants.

We may also issue shares from time to time to our directors, officers, employees, and

from issuance of shares upon exercise of warrants and options or the perception that dilution may occur could cause the price per share

of common stock to fall.

of March 31, 2026, there were outstanding warrants to purchase an aggregate of approximately 79.0 million shares of Common Stock at a

cash exercise price of $0.1521 per share and vested options to purchase an aggregate of approximately 5 million shares at a weighted

average cash exercise price of $0.06.

Additional shares of Common Stock may be issuable as a result of anti-dilution provisions in the

outstanding warrants.

We may also issue shares from time to time to our directors, officers, employees, and consultants.

a result of the above discussed potential issuance of securities, such issuances by us could result in substantial dilution to the interests

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increased transaction costs that could adversely affect our price per share.

common stock is a “low-priced” security or “penny stock” under rules promulgated under the Exchange

In accordance with these rules, broker-dealers participating in transactions

in low-priced securities must first deliver a risk disclosure document which describes the risks associated with such stocks, the broker-dealer’s

duties in selling the stock, the customer’s rights and remedies and certain market and other information.

Furthermore, the broker-dealer

must make a suitability determination approving the customer for low-priced stock transactions based on the customer’s financial

situation, investment experience and objectives.

Broker-dealers must also disclose these restrictions in writing to the customer, obtain

specific written consent from the customer, and provide monthly account statements to the customer.

The effect of these restrictions

will likely decrease the willingness of broker-dealers to make a market in our Common Stock, will decrease liquidity of our Common Stock

and will increase transaction costs for sales and purchases of our Common Stock as compared to other securities.

common stock is a “low-priced” security or “penny stock” under rules promulgated under the Exchange Act.

In accordance

with these rules, broker-dealers participating in transactions in low-priced securities must first deliver a risk disclosure document

which describes the risks associated with such stocks, the broker-dealer’s duties in selling the stock, the customer’s rights

and remedies and certain market and other information.

Furthermore, the broker-dealer must make a suitability determination approving

the customer for low-priced stock transactions based on the customer’s financial situation, investment experience and objectives.

Broker-dealers must also disclose these restrictions in writing to the customer, obtain specific written consent from the customer, and

provide monthly account statements to the customer.

The effect of these restrictions will likely decrease the willingness of broker-dealers

to make a market in our Common Stock, will decrease liquidity of our Common Stock and will increase transaction costs for sales and purchases

of our Common Stock as compared to other securities.

addition, our Common stock is quoted on the Venture Market (the “OTCQB”), which is a regulated quotation service that displays

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significant volatility in the market prices for our Common Stock.

For the year ended March 31, 2025, the closing sale price on the OTCQB of our Common Stock fluctuated from a high of $0.71 per share to a low of $0.12 per share.

The price per

share of our Common Stock may not exceed or even remain at current levels in the future.

The market price of our Common Stock may be

affected by a number of factors, including, without limitation:

For the year ended March 31, 2026, the closing sale price on the OTCQB

of our Common Stock fluctuated from a high of $0.77 per share to a low of $0.32 per share.

The price per share of our Common Stock may

not exceed or even remain at current levels in the future.

The market price of our Common Stock may be affected by a number of factors,

including, without limitation:

of our clinical trials;

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of other material events;

● Governmental

● Patent or proprietary rights developments;

or proprietary rights developments;

contests or litigation;

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in third-party reimbursement policies for drugs;

● Fluctuations

in our operating results.

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

What changed 10-K

Item 1A. Risk Factors