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Item 1A. Risk Factors

2025-06-30 compared with 2024-07-01 · 301 added, 247 removed, 1341 unchanged (29% of the section changed)

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

intelligence based platforms my present new risks and challenges to our business.

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, social and political pressures, including public concern over the abuse of certain products, including opioids..

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.

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

received a Complete Response Letter (“CRL”) from the FDA indicating that the SequestOx™ NDA is not ready for approval.

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

factors may cause us to be unable to manufacture products or face interruptions in our manufacturing process.

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distribution and third-party sale of counterfeit versions of our products could have a detrimental effect on our reputation and business.

or other third parties may allege that we are infringing upon their IP.

or other third parties may allege that we are infringing upon their intellectual property.

Property Related Risks

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Related to our Common Shares

from issuance of shares to Lincoln Park, 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 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.

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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with customer expectations;

company’s ability to use and integrate technology, including the use and integration of artificial intelligence;

company’s ability to use and integrate technology, including the use and integration of AI;

appearance and labeling;

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

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

Our 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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for the manufacture of pharmaceutical products are subject to inspection by regulatory agencies at any time and must be operated in conformity

with current good manufacturing practice (“cGMP”) and, in the case of controlled substances, DEA regulations.

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.

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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

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.

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safety issues;

or regulatory delays;

or regulatory delays, including as a result of staffing reductions at FDA, DEA or other governmental agencies;

trial or bioequivalence costs that are greater than we currently anticipate.

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marketing our product other than as an OTC drug, in which case revenues could be substantially less than we anticipated.

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

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

of opioids may adversely affect our business.

acceptance of our products among physicians, patients, health care payors and the medical community, is a key component of commercial

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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 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 twelve months 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.

As of March 31, 2024, we continue to hold one approved ANDA for an opioid product that, while

approved by the FDA, has not been launched commercially.

Subsequent to March 31, 2024, the Company acquired three approved ANDAs for

opioid products, and plans on commercially launching these three products, in addition to the one approved ANDA for an opioid product

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

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 price.

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 personnel.

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

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

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.

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 could 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 product.

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

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

For the twelve

months ended March 31, 2024, our significant product families (defined as the top four products based on active pharmaceutical ingredient)

accounted for in excess of 90% of allocated revenues (defined as gross revenues less chargebacks and government rebates processed).

sale of our products may be significantly influenced by market conditions, as well as regulatory actions.

We may experience decreases

in the sale of our products in the future as a result of actions taken by our competitors, such as price reductions, or as a result of

regulatory actions, such as changes in quota, related to our products or to competing products, which could result in a material adverse

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

ended March 31, 2025, our significant product families (defined as the top four products based on active pharmaceutical ingredient) accounted

for in excess of 90% of allocated revenues (defined as gross revenues less chargebacks and government rebates processed).

our products may be significantly influenced by market conditions, as well as regulatory actions.

We may experience decreases in the

sale of our products in the future as a result of actions taken by our competitors, such as price reductions, or as a result of regulatory

actions, such as changes in quota, related to our products or to competing products, which could result in a material adverse on our

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

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

twelve months ended March 31, 2024, 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

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

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

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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Please see Item 9A “ Controls and Procedures ” in Part II.

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.

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

$100 million in annual revenues in a fiscal year, we are permitted, and we intend, to omit the auditor’s attestation on internal

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

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

rely on certain disclosure exemptions.

If some investors find our stock less attractive as a result, there may be a less active trading

market for the stock, and our stock price may be more volatile and could cause our stock price to decline.

Even if we remain a smaller

reporting company, if our public float exceeds $75 million and we report $100 million or more in annual revenues in a fiscal year, we

will become subject to the provisions of Section 404(b) of the Sarbanes-Oxley Act, requiring our independent registered public accounting

firm to provide an attestation report on the effectiveness of our internal control over financial reporting, making the public reporting

process more costly.

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

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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;

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

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, intellectual property 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 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;

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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results of operations, financial condition, and cash flow and ability to operate in the future, depending on the nature and magnitude

of the variation(s).

of the variation.

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

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regulatory approval of our products;

our growth, control expenditures and align costs with revenues;

our growth, control expenditures and align costs with revenues and

retain, and motivate qualified personnel;

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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 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;

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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for development or currently in development.

of March 31, 2024, we had cash on hand of approximately $7.1 million and a working capital surplus of $27.0 million, as of March 31,

2024, we generated income from operations totaling $10.8 million, net other expenses totaling $10.3 million and a net tax benefit of

$19.6 million, resulting in net income of $20.1 million.

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

Tablets, Isradipine Capsules, Trimipramine Capsules, Loxapine capsules, Amphetamine IR Tablets, Amphetamine ER Capsules and Dantrolene

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 future.

Furthermore, there can be no

assurances of the continuation of revenues being earned from the current generic product line, no assurances of 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 and ability to operate in the future.

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.

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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;

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

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 affected.

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

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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 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, 2023,

we determined that circumstances indicated that the value of our intangible assets may not be recoverable.

During the years ended March

31, 2024 and 2023, we recorded impairment of approximately $0.0 million, and $0.3 million respectively, of our ANDA and patent intangible

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.

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adverse events.

The FDA also can require companies to formulate approved Risk Evaluation and Mitigation Strategies (REMS) to help ensure

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

that a drug’s benefits outweigh its risks.

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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)’s

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

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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.

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

“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 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.

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.

The IRA contains substantial drug pricing reforms, including the establishment of a drug

price negotiation program within the U.S.

Department of Health and Human Services 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 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

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.

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.

Under this order, the

Department of Health and Human Services would direct federal health insurers to pay no more than the lowest price paid by other high-income

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

Under the order, most-favored nation pricing will

apply only to brand products without generic or biosimilar competition.

The effect of this order on our business and the pharmaceutical

industry in general is not yet known.

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

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

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

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.

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

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

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.

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with review of such agreements by the U.S.

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

of Justice (the “DOJ”) being required by law.

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

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may not be able to obtain or maintain adequate insurance coverages.

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

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

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may also be situations where we use our business judgment and decide to market and sell products, notwithstanding the fact that allegations

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

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

The risk involved in doing so can be substantial because the

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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

Department of Health and Human Services (“HHS”), the DOJ and various state Attorneys General actively enforce laws and regulations

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.

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partners comply with these restrictions.

the FDA, HHS, DOJ, and/or state Attorneys General, and qui tam relators may take the position that the Company is not in compliance with

such requirements, and if such non-compliance is proven, the consequences of such may have an adverse material effect on our business,

the FDA, HHS, DOJ, and/or state Attorneys General, and qui tam relators may take the position that the Company is not in compliance

with such requirements, and if such non-compliance is proven, the consequences of such may have an adverse material effect on our business,

financial condition, results of operations, cash flows and stock price.

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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 U.S.

Department of Health and Human Services, the U.S.

Department of Justice, individual

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

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.

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 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 government;

federal Health Insurance Portability and Accountability Act of 1996, or 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;

● 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;

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 the Health Information Technology for Economic and Clinical Health Act of 2009, or 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;

Foreign Corrupt Practices Act, or the 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.

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.

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;

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 Department of Justice have increased their FCPA enforcement activities

with respect to pharmaceutical companies.

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 intellectual property (“IP”), forcing us

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.

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Property Related Risks

ability to protect intellectual property rights and successfully defend third party allegations of intellectual property infringement

is vital to our business and uncertain.

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

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.

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Related to our Common Shares

from issuance of shares to 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.

of March 31, 2024, 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, vested options to purchase an aggregate of approximately 15.7 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 consultants.

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

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 Securities Exchange

Act of 1934, as amended (the “Exchange Act”).

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

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significant volatility in the market prices for our Common Stock.

For the twelve months ended March 31, 2024, the closing sale price

on the Venture Market (“OTCQB”) of our Common Stock fluctuated from a high of $0.21 per share to a low of $0.03 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, 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:

of our clinical trials;

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of other material events;

or proprietary rights developments;

● Governmental

● Patent 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