What changed in this filing

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Item 1A. Risk Factors

2023-03-16 compared with 2022-03-16 · 237 added, 200 removed, 1309 unchanged (25% of the section changed)

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are a specialty pharmaceutical company with a limited operating history, and it is difficult for potential investors to evaluate our

are a specialty pharmaceutical company founded in April 2017 and have only recently commenced revenue-producing operations and our historical

operations have primarily consisted of the preliminary formulation, testing and development of our various product candidates.

operating history makes it difficult for potential investors to evaluate our initial product candidates or our prospective operations.

As an early-stage company, we are subject to all the risks inherent in the initial organization, financing, expenditures, complications

and delays in a new business.

Further, biopharmaceutical product development is a highly speculative undertaking, involves a substantial

degree of risk and is a capital-intensive business.

Accordingly, you should consider our prospects in light of the costs, uncertainties,

delays and difficulties frequently encountered by companies in the early stages of product development and commercialization, especially

clinical-stage biopharmaceutical companies such as ours.

are a specialty pharmaceutical company founded in April 2017 and have commenced revenue-producing operations and our historical operations

have primarily consisted of the preliminary formulation, testing and development of our various product candidates.

Our limited operating

history makes it difficult for potential investors to evaluate our initial product candidates or our prospective operations.

As an early-stage

company, we are subject to all the risks inherent in the initial organization, financing, expenditures, complications and delays in a

new business.

Further, biopharmaceutical product development is a highly speculative undertaking, involves a substantial degree of risk

and is a capital-intensive business.

Accordingly, you should consider our prospects in light of the costs, uncertainties, delays and

difficulties frequently encountered by companies in the early stages of product development and commercialization, especially clinical-stage

biopharmaceutical companies such as ours.

As a company with a limited operating history, we may be unable to:

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execute any one of the foregoing, our business may not succeed.

business is adversely affected by the ongoing coronavirus pandemic and the impact could be material.

health outbreaks, epidemics or pandemics have had, and could in the future have, an adverse impact on our operations and financial condition.

The continuing pandemic caused by the novel strain of coronavirus (COVID-19) has caused many countries, including the United States,

to declare national emergencies and implement preventive measures such as travel bans and shelter-in-place or total lock-down orders,

some of which have eased.

The continuation or re-implementation of these bans and orders remains uncertain.

In some cases, these bans

and orders have influenced certain aspects of our business.

For example, we began commercializing our Biorphen product in December 2019

and Alkindi Sprinkle product in December 2020;

however, we have encountered difficulty in creating significant market pull-through demand

for our products in 2020 and 2021 as our in-person sales calls to key personnel at hospitals and surgical centers and introductory product

presentation seminars were limited as a result of the COVID-19 pandemic.

We are working on other promotional efforts to drive further

adoption in the market, but we may see our product sales and marketing efforts continue to be adversely affected by the pandemic in 2022

COVID-19 may also affect our ability to complete recruitment and data analysis for our clinical trials and our ability to

conduct research and development of our complement programs in our planned timeframe.

The extent to which COVID-19 impacts our operations

will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration and severity

of the outbreak, and the actions that may be required to contain COVID-19 or treat its impact.

In particular, as a result of the COVID-19

pandemic, we may experience disruptions that could severely impact our business, preclinical studies, drug manufacturing and clinical

trials including:

of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as our clinical trial

sites and hospital staff supporting the conduct of our clinical trials;

of key clinical trial activities, such as clinical trial site data monitoring, due to limitations on travel imposed or recommended

by federal or state governments, employers and others or interruption of clinical trial subject visits and study procedures, which

may impact the integrity of subject data and clinical study endpoints;

or delays in the operations of the FDA or other regulatory authorities, which may impact review and approval timelines;

of, or delays in promoting our products in-person, at conferences and at hospitals due to limitations on travel and in-person gatherings

imposed or recommended by federal or state governments.

may need to grow the size of our organization, and we could experience difficulties in managing this growth .

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any cybersecurity incidents, could harm our ability to operate our business effectively.

the implementation of security measures, our internal computer systems and those of third parties with which we contract are vulnerable

to damage from cyber-attacks, computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical

System failures, accidents or security breaches could cause interruptions in our operations, and could result in a material

disruption of our product development and clinical activities and business operations, in addition to possibly requiring substantial

expenditures of resources to remedy.

Cybersecurity attacks in particular are evolving and include, but are not limited to, malicious

software, attempts to gain unauthorized access to data and other electronic security breaches that could lead to disruptions in systems,

misappropriation of our confidential or otherwise protected information and corruption of data.

The loss, theft or sabotage of product

development or clinical trial data could result in delays in our regulatory approval efforts and significantly increase our costs to

recover or reproduce the data.

To the extent that any disruption or security breach were to result in a loss of, or damage to, our data

or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and our development

programs and the development of our product candidates could be delayed.

the implementation of security measures, our internal computer systems and those of third parties with which we contract are

vulnerable to damage from cyber attacks, computer viruses, unauthorized access, natural disasters, terrorism, war and

telecommunication and electrical failures.

System failures, accidents or security breaches could cause interruptions in our

operations, and could result in a material disruption of our product development and clinical activities and business operations, in

addition to possibly requiring substantial expenditures of resources to remedy.

Cybersecurity attacks in particular are evolving and

include, but are not limited to, malicious software, attempts to gain unauthorized access to data and other electronic security

breaches that could lead to disruptions in systems, misappropriation of our confidential or otherwise protected information and

corruption of data.

The loss, theft or sabotage of product development or clinical trial data could result in delays in our

regulatory approval efforts and significantly increase our costs to recover or reproduce the data.

To the extent that any disruption

or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential

or proprietary information, we could incur liability and our development programs and the development of our product candidates

could be delayed.

of counterfeits of any of our product candidates, as well as unauthorized sales of any of our product candidates, may have adverse effects

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As noted below, many of our product candidates are not eligible for patent protection or the market and data exclusivity provisions under

the Federal Food, Drug and Cosmetic Act (“FDCA”).

Consequently, our commercial operations face significant direct competition

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dosing of our product candidates in any required clinical trial may not be at an optimal level;

results of our clinical trials may not be satisfactory or may not meet the level of statistical or clinical significance required

by the FDA or other regulatory agencies for marketing approval;

dosing of our product candidates in any required clinical trial may not be at an optimal level;

in our clinical trials may suffer adverse effects for reasons that may or may not be related to our product candidates;

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intend to seek FDA approval through the 505(b)(2) regulatory pathway for the majority of our product candidates.

The Drug Price

Competition and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act, added Section 505(b)(2) to the Federal Food,

Drug and Cosmetic Act (“FDCA”).

Section 505(b)(2) permits the filing of an NDA where at least some of the information required

for approval comes from studies that were not conducted by or for the applicant.

If the FDA does not allow us to pursue the 505(b)(2)

regulatory pathway for our product candidates as anticipated, we may need to conduct additional clinical trials, provide additional data

and information and meet additional standards for regulatory approval.

If this were to occur, the time and financial resources required

to obtain FDA approval for our product candidates would likely substantially increase.

Moreover, the inability to pursue the 505(b)(2)

regulatory pathway could result in new competitive products reaching the market faster than our product candidates, which could materially

adversely impact our competitive position and prospects.

Even if we are allowed to pursue the 505(b)(2) regulatory pathway for a product

candidate, we cannot assure you that we will receive the requisite or timely approvals for commercialization of such product candidate.

For example, we had under development a patented injectable pentoxifylline therapeutic candidate, which we believed would satisfy the

requirements of the 505(b)(2) regulatory pathway.

However, based on a pre-IND meeting with the FDA in March 2018 to discuss the clinical

and regulatory pathway for the product, we have decided to suspend all further development activities for this candidate indefinitely

due to extraordinarily high costs of the clinical trials that would be required by the FDA.

The Drug Price Competition

and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act, added Section 505(b)(2) to the FDCA.

Section 505(b)(2) permits the filing of an NDA where at least some of the information required for approval

comes from studies that were not conducted by or for the applicant.

If the FDA does not allow us to pursue the 505(b)(2) regulatory pathway

for our product candidates as anticipated, we may need to conduct additional clinical trials, provide additional data and information

and meet additional standards for regulatory approval.

If this were to occur, the time and financial resources required to obtain FDA

approval for our product candidates would likely substantially increase.

Moreover, the inability to pursue the 505(b)(2) regulatory pathway

could result in new competitive products reaching the market faster than our product candidates, which could materially adversely impact

our competitive position and prospects.

Even if we are allowed to pursue the 505(b)(2) regulatory pathway for a product candidate, we

cannot assure you that we will receive the requisite or timely approvals for commercialization of such product candidate.

we had under development a patented injectable pentoxifylline therapeutic candidate, which we believed would satisfy the requirements

of the 505(b)(2) regulatory pathway.

However, based on a pre-IND meeting with the FDA in March 2018 to discuss the clinical and regulatory

pathway for the product, we have decided to suspend all further development activities for this candidate indefinitely due to extraordinarily

high costs of the clinical trials that would be required by the FDA.

Notwithstanding

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convenience, dosing burden and ease of administration;

prevalence and severity of any adverse effects;

willingness of physicians to prescribe our product candidates, and the target patient population to try new therapies;

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Further, the FDA or comparable foreign regulatory authorities

may place conditions on approvals or require risk management plans or a Risk Evaluation and Mitigation Strategy (“REMS”),

may place conditions on approvals or require risk management plans or a REMS,

to assure the safe use of the drug.

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These requirements include registration with the FDA, as well as continued compliance

with current Good Clinical Practices regulations (“cGCPs”) for any clinical trials that we conduct post-approval.

with current cGCP regulations for any clinical trials that we conduct post-approval.

manufacturers of drug products and their facilities are subject to continual review and periodic inspections by the FDA and other regulatory

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established a Medicare Part D coverage gap discount program.

of the provisions of the Health Care Reform Law have yet to be implemented, and there have been judicial and Congressional challenges

to certain aspects of the Health Care Reform Law, as well as recent efforts by the Trump administration to repeal or replace certain

aspects of the Health Care Reform Law.

Since January 2017, former President Trump had signed two executive orders and other directives

designed to delay, circumvent or loosen certain requirements mandated by the Health Care Reform Law.

Concurrently, Congress has considered

legislation that would repeal or repeal and replace all or part of the Health Care Reform Law.

While Congress has not passed comprehensive

repeal legislation, two bills affecting the implementation of certain taxes under the Health Care Reform Law have been signed into law.

The Tax Act included a provision which repealed, effective January 1, 2019, the tax-based shared responsibility payment imposed by the

Health Care Reform Law on certain individuals who fail to maintain qualifying health coverage for all or part of a year that is commonly

referred to as the “individual mandate.” On January 22, 2018, former President Trump signed a continuing resolution on appropriations

for fiscal year 2018 that delayed the implementation of certain Health Care Reform Law-mandated fees, including the so-called “Cadillac”

tax on certain high-cost employer-sponsored insurance plans, the annual fee imposed on certain health insurance providers based on market

share, and the medical device excise tax on non-exempt medical devices.

The Bipartisan Budget Act of 2018, among other things, amended

the Health Care Reform, effective January 1, 2019, to increase from 50% to 70% the point-of-sale discount that is owed by pharmaceutical

manufacturers who participate in Medicare Part D and to close the coverage gap in most Medicare drug plans, commonly referred to as the

“donut hole”.

of the provisions of the Health Care Reform Law have yet to be implemented, and there have been judicial and Congressional

challenges to certain aspects of the Health Care Reform Law, as well as recent efforts by the Trump administration to repeal or

replace certain aspects of the Health Care Reform Law.

Since January 2017, former President Trump had signed two executive orders

and other directives designed to delay, circumvent or loosen certain requirements mandated by the Health Care Reform Law.

Concurrently, Congress has considered legislation that would repeal or repeal and replace all or part of the Health Care Reform Law.

While Congress has not passed comprehensive repeal legislation, two bills affecting the implementation of certain taxes under the

Health Care Reform Law have been signed into law.

The Tax Act included a provision which repealed, effective January 1, 2019, the

tax-based shared responsibility payment imposed by the Health Care Reform Law on certain individuals who fail to maintain qualifying

health coverage for all or part of a year that is commonly referred to as the “individual mandate.” On January 22, 2018,

former President Trump signed a continuing resolution on appropriations for fiscal year 2018 that delayed the implementation of

certain Health Care Reform Law-mandated fees, including the so-called “Cadillac” tax on certain high-cost

employer-sponsored insurance plans, the annual fee imposed on certain health insurance providers based on market share, and the

medical device excise tax on non-exempt medical devices.

The Bipartisan Budget Act of 2018, among other things, amended the Health

Care Reform Law, effective January 1, 2019, to increase from 50% to 70% the point-of-sale discount that is owed by pharmaceutical

manufacturers who participate in Medicare Part D and to close the coverage gap in most Medicare drug plans, commonly referred to as

the “donut hole”.

On December 14, 2018, a Texas U.S.

District Court Judge ruled that the Health Care Reform is unconstitutional

in its entirety because the “individual mandate” was repealed by Congress as part of the Tax Act.

While the Texas U.S.

Court Judge, as well as the Trump administration and CMS, have stated that the ruling will have no immediate effect pending appeal of

the decision, it is unclear how this decision, subsequent appeals, and other efforts to repeal and replace the Health Care Reform will

impact the ACA and our business.

We cannot predict the impact on our business of changes to current laws and regulations.

changes that lower reimbursements for products for which we may obtain regulatory approval, or that impose administrative and financial

burdens on us, could adversely affect our business.

District Court Judge ruled that the Health Care Reform Law is

unconstitutional in its entirety because the “individual mandate” was repealed by Congress as part of the Tax Act.

June 17, 2021, the U.S.

Supreme Court overturned the 2018 Texas U.S.

District Court decision.

It is unclear how subsequent appeals, and other efforts to repeal and replace the Health Care Reform will impact our business.

We cannot predict the

impact on our business of changes to current laws and regulations.

However, any changes that lower reimbursements for products for

which we may obtain regulatory approval, or that impose administrative and financial burdens on us, could adversely affect our

addition, other legislative changes have been proposed and adopted in the United States since the Health Care Reform Law was enacted.

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reimbursable under Medicare, Medicaid or other federally financed health care programs.

This statute has been interpreted broadly to

apply to arrangements between pharmaceutical manufacturers on the one hand and prescribers, purchasers, formulary managers, and others

on the other hand.

Although there are several statutory exceptions and regulatory safe harbors protecting certain common activities from

prosecution, the exceptions and safe harbors are drawn narrowly, and practices that involve remuneration intended to induce prescribing,

purchasing or recommending may be subject to scrutiny if they do not qualify for an exception or safe harbor.

Our practices may not,

in all cases, meet all of the criteria for safe harbor protection from anti-kickback liability.

Moreover, recent health care reform legislation

has strengthened these laws.

For example, the Health Care Reform Law, among other things, amended the intent requirement of the U.S.

This statute has been interpreted broadly to apply

to arrangements between pharmaceutical manufacturers on the one hand and prescribers, purchasers, formulary managers, and others on the

Although there are several statutory exceptions and regulatory safe harbors protecting certain common activities from prosecution,

the exceptions and safe harbors are drawn narrowly, and practices that involve remuneration intended to induce prescribing, purchasing

or recommending may be subject to scrutiny if they do not qualify for an exception or safe harbor.

Failure to meet all of the requirements

of a particular applicable statutory exception or regulatory safe harbor does not make the conduct per se illegal under the Federal Anti-Kickback

Instead, the legality of the arrangement will be evaluated on a case-by-case basis based on a cumulative review of all of its

facts and circumstances.

Our practices may not, in all cases, meet all of the criteria for safe harbor protection from anti-kickback liability.

Moreover, recent health care reform legislation has strengthened these laws.

For example, the Health Care Reform Law, among other things,

amended the intent requirement of the U.S.

Anti-Kickback Statute and other criminal health care fraud statutes;

a person or entity no longer needs to have actual knowledge of the

statutes or specific intent to violate them in order to have committed a violation.

In addition, the Health Care Reform Law provides

that the government may assert that a claim including items or services resulting from a violation of the U.S.

Anti-Kickback Statute

constitutes a false or fraudulent claim for purposes of the U.S.

a person or entity no

longer needs to have actual knowledge of the statutes or specific intent to violate them in order to have committed a violation.

the Health Care Reform Law provides that the government may assert that a claim including items or services resulting from a violation

Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the U.S.

False Claims Act.

Federal false claims laws prohibit any person from

knowingly presenting, or causing to be presented, a false claim for payment to the federal government or knowingly making, or causing

to be made, a false statement to get a false claim paid.

the past few years, several pharmaceutical and other health care companies have been prosecuted under these laws for a variety of alleged

promotional and marketing activities, such as:

allegedly providing free trips, free goods, sham consulting fees and grants and other

monetary benefits to prescribers;

reporting to pricing services inflated average wholesale prices that were then used by federal programs

to set reimbursement rates;

Federal false claims

laws prohibit any person from knowingly presenting, or causing to be presented, a false claim for payment to the federal government or

knowingly making, or causing to be made, a false statement to get a false claim paid.

Over the past few years, several pharmaceutical and other health care companies have been prosecuted under these laws for a variety of

alleged promotional and marketing activities, such as:

allegedly providing free trips, free goods, sham consulting fees and grants and

other monetary benefits to prescribers;

reporting to pricing services inflated average wholesale prices that were then used by federal

programs to set reimbursement rates;

engaging in off-label promotion that caused claims to be submitted to Medicare or Medicaid for non-covered,

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products from reimbursement under government programs, fines and imprisonment.

Due to the breadth of these federal and state anti-kickback

laws, and the potential for additional legal or regulatory change in this area, it is possible that our future business activities, including

our sales and marketing practices and/or our future relationships with physicians and the medical community might be challenged under

anti-kickback laws, which could harm us.

are completely dependent on third parties to manufacture our approved products and new product candidates, and our commercialization

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fail to do so at acceptable quality levels or prices .

do not currently have, nor do we plan to acquire, the capability or infrastructure to manufacture the active pharmaceutical ingredient

(“API”) in our product candidates for use in our clinical trials or for commercial product, if any.

do not currently have, nor do we plan to acquire, the capability or infrastructure to manufacture the API in our product candidates for use in our clinical trials or for commercial product, if any.

In addition, we do not

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any of these outcomes occur, we may not receive approval for our product candidate.

coverage and reimbursement and health care cost containment initiatives and treatment guidelines may constrain our future revenues .

ability to successfully market Biorphen and our product candidates will depend in part on the coverage and level of reimbursement that

government health administration authorities, private health coverage insurers and other organizations provide for the cost of our products

and related treatments.

Countries in which any of our product candidates are sold through reimbursement schemes under national health

insurance programs frequently require that manufacturers and sellers of pharmaceutical products obtain governmental approval of initial

prices and any subsequent price increases.

In certain countries, including the United States, government-funded and private medical care

plans can exert significant indirect pressure on prices.

Increasingly, third-party payors attempt to contain health care costs in ways

that are likely to impact our development of products, including:

to approve or challenging the prices charged for health care products;

reimportation schemes from lower priced jurisdictions;

both coverage and the amount of reimbursement for new therapeutic products;

or limiting coverage for products that are approved by the regulatory agencies but are considered to be experimental or investigational

by third-party payors;

to provide coverage when an approved product is used in a way that has not received regulatory marketing approval.

may not be able to sell Biorphen or our product candidates profitably if adequate prices are not approved or coverage and reimbursement

is unavailable or limited in scope.

are subject to extensive laws and regulations related to data privacy, and our failure to comply with these laws and regulations could

harm our business.

are subject to laws and regulations governing data privacy and the protection of personal information.

These laws and regulations govern

our processing of personal data, including the collection, access, use, analysis, modification, storage, transfer, security breach notification,

destruction and disposal of personal data.

There are foreign and state law versions of these laws and regulations to which we are currently

and/or may in the future, be subject.

For example, the collection and use of personal health data in the European Union is governed by

The GDPR, which is wide-ranging in scope, imposes several requirements relating to the consent of the individuals to whom the

personal data relates, the information provided to the individuals, the security and confidentiality of the personal data, data breach

notification and the use of third-party processors in connection with the processing of personal data.

The GDPR also imposes strict rules

on the transfer of personal data out of the European Union to the United States, provides an enforcement authority and imposes large

monetary penalties for noncompliance.

The GDPR requirements apply not only to third-party transactions, but also to transfers of information

within our company, including employee information.

In addition, in 2018 California adopted a new privacy law that became effective on

January 1, 2020, which borrows heavily from the GDPR.

The GDPR and similar data privacy laws of other jurisdictions place significant

responsibilities on us and create potential liability in relation to personal data that we or our third-party service providers process,

including in clinical trials conducted in the United States and the European Union.

In addition, we expect that there will continue to

be new proposed laws, regulations and industry standards relating to privacy and data protection in the United States, the European Union

and other jurisdictions, and we cannot determine the impact such future laws, regulations and standards may have on our business.

are subject to data privacy and security laws and regulations by both the federal government and the states in which we conduct our business.

HIPAA and their respective implementing regulations,

including the Final Omnibus Rule published on January 25, 2013, govern our processing of personal data, including the collection, access,

use, analysis, modification, storage, transfer, security breach notification, destruction and disposal of personal data.

There are foreign

and state law versions of these laws and regulations to which we are currently and/or may in the future, be subject.

For example, the

collection and use of personal health data in the European Union is governed by the GDPR.

The GDPR, which is wide-ranging in scope, imposes

several requirements relating to the consent of the individuals to whom the personal data relates, the information provided to the individuals,

the security and confidentiality of the personal data, data breach notification and the use of third-party processors in connection with

the processing of personal data.

The GDPR also imposes strict rules on the transfer of personal data out of the European Union to the

United States, provides an enforcement authority and imposes large monetary penalties for noncompliance.

The GDPR requirements apply

not only to third-party transactions, but also to transfers of information within our company, including employee information.

the United States, there are numerous privacy laws that may be applicable to our activities, and a range of enforcement agencies at both

the state and federal levels that can review companies for privacy and data security concerns based on general consumer protection laws.

New laws also are being considered or have been implemented at both the state and federal levels.

For example, the California Consumer

Privacy Act of 2018 (effective on January 1, 2020), as amended by the California Privacy Rights and Enforcement Act of 2020 (effective

on January 1, 2023) (“CCPA”), requires companies that process information of California residents (“consumers,”

as defined under the CCPA) to make specific disclosures about their data collection, use and disclosure practices, provides consumers

with individual data privacy rights, including enabling consumers to limit the use of their sensitive personal information, imposes new

operational requirements for covered businesses, imposes data retention limitations, provides a private right of action for data breaches,

creates a statutory damages framework and creates a new state agency, the California Privacy Protection Agency, that is vested with the

authority to implement and enforce the CCPA.

Although there are limited exemptions for clinical trial data under the CCPA, the CCPA and

other similar laws could impact our business activities in the future depending on our revenue growth, how much consumer data we process,

and how such laws are interpreted.

Additionally, four additional states have enacted privacy laws, which could increase our potential

liability and adversely affect our business in the future.

In particular, the Virginia Consumer Data Protection Act (“VCDPA”)

became effective on January 1, 2023;

the Colorado Privacy Act (“CPA”) and the Connecticut Data Privacy Act (“CTDPA”)

will become effective on July 1, 2023;

and the Utah Consumer Privacy Act (“UCPA”) will become effective on December 31, 2023.

While these regulations incorporate many similar concepts to the CCPA, there are also several key differences in their scope, application,

and enforcement that will, among other things, impact how regulated businesses collect and process personal sensitive data, conduct data

protection assessments, transfer personal data to affiliates, and respond to consumer rights requests.

Other states are considering similar

legislation and a broad range of legislative measures also have been introduced at the federal level.

Such proposed legislation, if enacted,

may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional investment of resources

in compliance programs, impact strategies and the availability of previously useful data and could result in increased compliance costs

and/or changes in business practices and policies.

The existence of comprehensive privacy laws in different states in the country makes

our compliance obligations more complex and costly and may increase the likelihood that we may be subject to enforcement actions or otherwise

incur liability for noncompliance.

regulations promulgated pursuant to HIPAA imposes privacy, security and breach notification obligations on certain healthcare

providers, health plans, and healthcare clearinghouses, known as covered entities, as well as their business associates that perform

certain services that involve creating, receiving, maintaining or transmitting individually identifiable health information for or on

behalf of such covered entities, and their covered subcontractors.

HIPAA establishes privacy and security standards that limit the use

and disclosure of individually identifiable health information and protected health information, or PHI, and requires the implementation

of administrative, physical, and technological safeguards to protect the privacy of PHI and ensure the confidentiality, integrity, and

availability of electronic PHI.

Most healthcare providers, including research institutions from which we obtain patient health information,

are subject to privacy and security regulations promulgated under HIPAA.

We do not believe that we are currently acting as a covered entity or business associate under HIPAA and thus

are not directly subject to its requirements or penalties.

However, any person may be prosecuted under HIPAA’s criminal provisions

either directly or under aiding-and-abetting or conspiracy principles.

Consequently, depending on the facts and circumstances, we could

face substantial criminal penalties if we knowingly receive individually identifiable health information from a HIPAA-covered healthcare

provider or research institution that has not satisfied HIPAA’s requirements for disclosure of individually identifiable health

global legislative and regulatory landscape for privacy and data protection continues to evolve, and implementation standards and enforcement

practices are likely to remain uncertain for the foreseeable future.

This evolution may create uncertainty in our business, result in

liability or impose additional costs on us.

The cost of compliance with these laws, regulations and standards is high and is likely to

continue to increase in the future.

is possible that privacy laws may be interpreted and applied in a manner that is inconsistent with our practices.

Any failure or perceived

failure by us to comply with federal, state, or foreign laws or self-regulatory standards could result in negative publicity, diversion

of management time and effort and proceedings against us by governmental entities or others.

In many jurisdictions, enforcement actions

and consequences for noncompliance are rising.

As we continue to expand into other foreign countries and jurisdictions, we may be subject

to additional laws and regulations that may affect how we conduct business.

addition to the risks associated with enforcement activities and potential contractual liabilities, our ongoing efforts to comply with

evolving laws and regulations at the federal and state level may be costly and require ongoing modifications to our policies, procedures

Further, any failure by our third-party collaborators, service providers, contractors or consultants to comply with applicable

law, regulations or contractual obligations related to data privacy or security could result in proceedings against us by governmental

entities or others.

We may also publish

privacy policies and other documentation regarding our collection, processing, use and disclosure of personal information and/or other

confidential information.

Although we endeavor to comply with applicable regulations, our published policies and other documentation,

we may at times fail to do so or may be perceived to have failed to do so.

Despite our efforts, we may not be successful in achieving

compliance if our employees or vendors fail to comply with our published policies and documentation.

Such failures can subject us to

potential international, local, state and federal action if they are found to be deceptive, unfair, or misrepresentative of our actual

Claims that we have violated individuals’ privacy rights or failed to comply with data protection laws or applicable

privacy notices, even if we are not found liable, could be expensive and time-consuming to defend and could result in adverse publicity

that could harm our business.

We also face a threat of consumer class actions related to these laws and the overall protection of personal

Even if we are not determined to have violated these laws, government investigations into these issues typically require

the expenditure of significant resources and generate negative publicity, which could harm our reputation and our business, financial

condition, results of operations or prospects.

Relating to Our Intellectual Property Rights

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from the U.S.

Patent and Trademark Office (“U.S.

PTO”), or made a misleading statement, during prosecution.

Patent and Trademark Office (“USPTO”), or made a misleading statement, during prosecution.

Third parties

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some of the other changes introduced by the AIA are changes that limit where a patentee may file a patent infringement suit and providing

opportunities for third parties to challenge any issued patent in the U.S.

opportunities for third parties to challenge any issued patent in the USPTO.

This applies to all of our U.S.

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before March 16, 2013.

Because of a lower evidentiary standard necessary to invalidate a patent claim in the U.S.

PTO proceedings compared

Because of a lower evidentiary standard necessary to invalidate a patent claim in the USPTO proceedings compared

to the evidentiary standard in U.S.

federal court, a third party could potentially provide evidence in a U.S.

PTO proceeding sufficient

PTO to hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if first presented

federal court, a third party could potentially provide evidence in a USPTO proceeding sufficient

for the USPTO to hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if first presented

in a district court action.

Accordingly, a third party may attempt to use the U.S.

PTO procedures to invalidate our patent claims that

Accordingly, a third party may attempt to use the USPTO procedures to invalidate our patent claims that

would not have been invalidated if first challenged by the third party as a defendant in a district court action.

on decisions by the U.S.

Congress, the federal courts, the U.S.

PTO, or similar authorities in foreign jurisdictions, the laws and regulations

Congress, the federal courts, the USPTO, or similar authorities in foreign jurisdictions, the laws and regulations

governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce our existing in-licensed

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If we were to challenge the validity of these or any issued U.S.

an administrative trial before the Patent Trial and Appeal Board in the U.S.

PTO, we would have to prove that the claims are unpatentable

an administrative trial before the Patent Trial and Appeal Board in the USPTO, we would have to prove that the claims are unpatentable

by a preponderance of the evidence.

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in earnings estimates or recommendations by securities analysts, if our shares are covered by analysts;

being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley

in earnings estimates or recommendations by securities analysts, if our shares are covered by analysts;

of technological innovations or new competitive products by others;

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are not “emerging growth companies” including, but not limited to:

being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley

disclosure obligations regarding executive compensation in our periodic reports and proxy statements;

from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute

being required to comply with the auditor attestation requirements of Section 404 of the

Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”);

disclosure obligations regarding executive compensation in our periodic reports and proxy

from the requirements of holding a nonbinding advisory vote on executive compensation and

stockholder approval of any golden parachute payments;

transition periods available for complying with new or revised accounting standards.

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of federal NOLs generated in tax years beginning before December 31, 2017, is limited.

It is uncertain if and to what extent various

states will conform to the Tax Act.

In addition, under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, and corresponding

provisions of state law, if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50%

change (by value) in its equity ownership over a three-year period, the corporation’s ability to use its pre-change NOL carryforwards,

or NOLs, and other pre-change tax attributes (such as research tax credits) to offset its post-change income may be limited.

We filed in GA, IL, MN and TN for 2021.

conforms to the Tax Act.

IL and TN do not conform (their NOL will expire if not used and there is no limit deduction on their NOL).

does conform with the 80% of taxable income limitation section of the Tax Act but not the indefinite carryforward section.

expire if not used.

In addition, under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, and corresponding provisions

of state law, if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50% change (by

value) in its equity ownership over a three-year period, the corporation’s ability to use its pre-change NOL carryforwards, or

NOLs, and other pre-change tax attributes (such as research tax credits) to offset its post-change income may be limited.

We are performing

100 unchanged sentences

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