What changed in this filing

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Item 1A. Risk Factors

2024-03-28 compared with 2023-03-31 · 359 added, 340 removed, 359 unchanged (66% of the section changed)

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date we have not generated material revenue from the sale of products, and we do not anticipate that we will report operating income

in the near future.

Our initial product, GlucoTrack® 1.0, has not been approved for marketing in the United States and may not be

sold or marketed without FDA clearance or approval in the United States.

Our next generation product, GlucoTrack® 2.0 is currently

under development.

We continue to incur research and development and selling, marketing and general and administrative expenses related

to our operations, development and commercialization of our first product.

in the foreseeable future.

Our initial product, Glucotrack CBGM, has not been approved for marketing in the United States and is currently

under preclinical development.

We continue to incur research and development and selling, marketing and general and administrative expenses

related to our operations, development and commercialization of our first product.

Our operating losses for the years ended December

and 2021 were approximately $4.4 million and $4.0 million, respectively, and we had an accumulated deficit of approximately $101.9 million

as of December 31, 2022.

We expect to continue to incur losses for the foreseeable future, and these losses will likely increase as we

develop and prepare to commercialize GlucoTrack® 2.0.

If we are not successful in developing, manufacturing and distributing GlucoTrack®

2.0, or if GlucoTrack® 2.0 does not achieve market acceptance, we may never become profitable.

Even if we achieve profitability in

the future, we may not be able to sustain profitability in subsequent periods.

31, 2023 and 2022 were approximately $7.1 million and $4.4 million, respectively, and we had an accumulated deficit of approximately

$109.8 million as of December 31, 2023.

We expect to continue to incur losses for the foreseeable future, and these losses will likely

increase as we develop and prepare to commercialize Glucotrack CBGM.

If we are not successful in developing, manufacturing and distributing

Glucotrack CBGM, or if Glucotrack CBGM does not achieve market acceptance, we may never become profitable.

Even if we achieve profitability

in the future, we may not be able to sustain profitability in subsequent periods.

we continue to evolve from a company primarily involved in development to a company also involved in commercialization, we may encounter

difficulties in managing our growth and expanding our operations successfully.

anticipate that, as our operations expand and, assuming that our development, testing, studies and trials are successful, we will need

to expand our manufacturing, marketing and sales capabilities by contracting with third parties.

Maintaining these relationships and

managing our future growth will impose significant added responsibilities on members of our management.

We must be able to manage our

development efforts effectively;

manage our clinical trials effectively;

hire, train and integrate additional management, development,

administrative and sales and marketing personnel;

improve managerial, development, operational and finance systems;

and expand our facilities,

all of which may impose a strain on our administrative and operational infrastructure.

may have future capital needs and may not be able to obtain additional financing on acceptable terms.

and credit market conditions, the performance of our industry and our financial performance, as well as other factors, may constrain

our financing abilities.

Our ability to secure additional financing, if available, and to satisfy our financial obligations under indebtedness

outstanding from time to time will depend upon our future operating performance, the availability of credit, economic conditions and

financial, business and other factors, many of which are beyond our control.

may require additional financing to fund our operations and growth.

The failure to secure additional financing could have an adverse

effect on our continued development or growth.

None of our officers, directors or stockholders is required to provide any financing to

additional capital may cause dilution to our existing stockholders and investors, restrict our operations, or require us to relinquish

rights to our products and/or product candidates on unfavorable terms to us.

will seek additional capital through a variety of means, including through private and public equity offerings and debt financings, collaborations,

strategic alliances and marketing, distribution, or licensing arrangements.

To the extent that we raise additional capital through the

sale of equity or convertible debt securities, or through the issuance of shares under other types of contracts, or upon the exercise

or conversion of outstanding options, warrants, convertible debt or other similar securities, the ownership interests of our stockholders

will be diluted, and the terms of such financings may include liquidation or other preferences, anti-dilution rights, conversion and

exercise price adjustments and other provisions that adversely affect the rights of our stockholders, including rights, preferences and

privileges that are senior to those of our holders of common stock in terms of the payment of dividends or in the event of a liquidation.

In addition, debt financing, if available, could include covenants limiting or restricting our ability to take certain actions, such

as incurring additional debt, making capital expenditures, entering into licensing arrangements, or declaring dividends and may require

us to grant security interests in our assets.

If we raise additional funds through collaborations, strategic alliances, or marketing,

distribution, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue

streams, product or product candidates or grant licenses on terms that may not be favorable to us.

If we are unable to raise additional

funds through equity or debt financing when needed, we may need to curtail or cease our operations.

independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about

our ability to continue as a “going concern.”

may not have sufficient liquidity to meet our anticipated obligations over the next year from the issuance of the financial statements

contained in this Report.

We have incurred net losses and negative cash flows from our operations and comprehensive loss since our inception

and as of December 31, 2023, there is an accumulated deficit of $109,853.

These conditions raise substantial doubt about the Company’s

ability to continue as a going concern.

Related to Owning our Common Stock

have never declared or paid any cash dividends on our Common Stock and do not anticipate paying any dividends on our Common Stock in

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factors deemed relevant to our Board of Directors.

Common Stock may be delisted from Nasdaq if we fail to comply with continued listing standards.

Common Stock is currently traded on Nasdaq under the symbol “GCTK.” If we fail to meet any of the continued listing standards

of Nasdaq, for which we have one or more deficiencies, our Common Stock could be delisted from Nasdaq.

The continued listing standards

include specifically enumerated criteria, such as:

$1.00 minimum closing bid price;

Stockholders’

equity of $2,500;

shares of publicly held Common Stock with a market value of at least $1,000;

round-lot stockholders;

with Nasdaq’s corporate governance requirements, as well as additional or more stringent criteria that may be applied in the

exercise of Nasdaq’s discretionary authority.

May 26, 2023, we received a notice from the Staff of Nasdaq that we no longer complied with Nasdaq Listing Rule 5550(a)(2), which requires

listed securities to maintain a minimum bid price of $1.00 per share.

The Nasdaq letter stated that we had 180 days, or until November

22, 2023, to regain compliance with the Bid Price Rule.

On November 24, 2023, we received a letter from the Staff of Nasdaq notifying

us that we have been granted an additional 180 calendar days, or until May 20, 2024, to regain compliance with the Bid Price Rule.

at any time during the Extended Compliance Period, the closing bid price of our Common Stock is at least $1.00 per share for a minimum

of 10 consecutive business days, the Staff of Nasdaq will provide written confirmation that we have achieved compliance with the Bid

If we cannot demonstrate compliance during the Extended Compliance Period, then the Staff of Nasdaq will provide notice that

our Common Stock will be subject to delisting.

At that time, we may appeal the Staff’s determination to a hearings panel.

price on March 19, 2024 was $0.32, and, as such, we are not currently in compliance with the Bid Price Rule.

Nasdaq delists our Common Stock from trading on its exchange for failure to meet the Bid Price Rule or any other listing standards, we

and our stockholders could face significant material adverse consequences including:

limited availability of market quotations for our securities;

determination that our common stock is a “penny stock,” which will require brokers trading in our common stock to adhere

to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our common

limited amount of analyst coverage;

decreased ability to issue additional securities or obtain additional financing in the future.

had identified a material weakness in our internal control over financial reporting, and we may not be able to successfully implement

remedial measures.

identified material weaknesses related to our internal control over financial reporting as of December 31, 2023 and concluded that internal

control over financial reporting as at December 31, 2023 were not effective.

The ineffectiveness of the Company’s internal control

over financial reporting was due to identification of material weaknesses related to lack of sufficient internal accounting personnel,

segregation of duties, and lack of sufficient internal controls (including IT general controls) that encompass the Company as a whole

with respect to entity and transactions level controls in order to ensure complete documentation of complex and non-routine transactions

and adequate financial reporting.

there can be no assurance that we will not suffer from other material weaknesses or significant deficiencies in the future.

to remediate these material weaknesses or fail to otherwise maintain effective internal controls over financial reporting in the future,

such failure could result in a material misstatement of our annual or quarterly financial statements that would not be prevented or detected

on a timely basis and which could cause investors and other users to lose confidence in our financial statements, limit our ability to

raise capital and have a negative effect on the trading price of our Common Stock.

Additionally, failure to remediate the material weakness

or otherwise maintain effective internal controls over financial reporting may also negatively impact our operating results and financial

condition, impair our ability to timely file our periodic and other reports with the SEC, subject us to additional litigation and regulatory

actions and cause us to incur substantial additional costs in future periods relating to the implementation of remedial measures.

market price of our Common Stock may fluctuate significantly.

market price of the Common Stock may fluctuate significantly in response to numerous factors, some of which are beyond our control, such

of trials or studies;

announcement of new products or product enhancements by us or our competitors;

concerning intellectual property rights and regulatory approvals;

in our and our competitors’ results of operations;

in earnings estimates or recommendations by securities analysts, if the Common Stock is covered by analysts;

in the medical device industry;

results of product liability or intellectual property lawsuits;

issuances of Common Stock or other securities;

addition or departure of key personnel;

announcements

by us or our competitors of acquisitions, investments or strategic alliances;

market conditions and other factors, including factors unrelated to our operating performance.

in recent years, the stock market in general, and the market for medical device companies in particular, have experienced extreme price

and volume fluctuations.

Continued or renewed market fluctuations could result in extreme volatility in the price of our Common Stock,

which could cause a decline in the value of the Common Stock.

Related to our Business and Industry

crises and market instability may materially and adversely affect the demand for our products, as well as our ability to obtain credit

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failure to do so may materially adversely affect our ability to continue operations.

may not be approved for sale in the United States or other (non-CE Mark) jurisdictions.

will likely be required to undertake significant clinical trials to demonstrate to the FDA that GlucoTrack® is either safe and effective

for its intended use or is substantially equivalent in terms of safety and effectiveness to an existing, lawfully marketed non-Section

515 premarket approval (PMA) device (refer to “ Management Discussion and Analysis - Government Regulatory ”).

also be required to undertake clinical trials by non-U.S.

regulatory agencies in non-CE Mark jurisdictions.

Clinical trials are expensive

and uncertain processes that may take years to complete.

Failure can occur at any point in the process and early positive results do

not ensure that the entire clinical trial will be successful.

Product candidates in clinical trials may fail to show desired efficacy

and safety traits despite early promising results.

A number of companies in the medical device industry have suffered significant setbacks

in advanced clinical trials, even after their product candidates demonstrated promising results at earlier points.

results from the limited pre-clinical trials and safety and performance clinical trial that we have conducted should not be relied upon

as evidence that later-stage or large-scale clinical trials will succeed.

These trials involved limited patient populations and there

is no assurance that the experimental protocol or protocols, as the case may be, used in these informal trials will be methodologically

similar to ones submitted to the FDA or any other regulatory body for its approval.

Because of the sample size, possible variation in

methodology, differences in exclusion/inclusion criteria, or differences in endpoints, the results of these pre-clinical trials may not

CBGM is not approved for sale in the United States or other jurisdictions.

will likely be required to undertake significant clinical trials to demonstrate to the FDA that Glucotrack CBGM is safe and effective

for its intended use (refer to “ Management Discussion and Analysis - Government Regulatory ”).

We may also be required

to undertake similar clinical trials by non-U.S.

regulatory agencies, particularly for the European Union (CE Mark).

Clinical trials

for implantable medical devices are expensive and uncertain processes that take years to complete.

Failure can occur at any point in

the process and early positive results do not ensure that the entire clinical trial will be successful.

Product candidates in clinical

trials may fail to show desired efficacy and safety traits despite early promising results.

A number of companies in the medical device

industry have suffered significant setbacks in advanced clinical trials, even after their product candidates demonstrated promising results

at earlier points.

results from the limited safety and performance pre-clinical trials that we have conducted should not be relied upon as evidence that

early-stage or large-scale clinical trials will succeed.

Despite efforts to choose the proper animal model reflecting our intended use,

our pre-clinical animal trials cannot be a guarantee of clinical trial success because human physiology and anatomy are different.

of the sample size, possible variation in methodology, or differences in physiology, the results of these pre-clinical trials may not

be indicative of future results.

We will likely be required to demonstrate through well-controlled clinical trials that GlucoTrack®

or future product candidates, if any, are safe and effective for their intended uses.

In the event that the FDA deems GlucoTrack®

to be a Class II device, which we do not believe is likely at this point, then we would be required to demonstrate that it is substantially

equivalent in terms of safety and effectiveness to a device lawfully marketed either through a premarket notification or prior to May

Additionally,

although we have received our CE Mark approval for GlucoTrack® 1.0, EU member countries may request or require additional performance

and/or safety data from time to time, on a case-by-case basis.

GlucoTrack® 2.0 is currently under development.

GlucoTrack® or our future product candidates, if any, may not be cleared or approved, as the case may be, even if the clinical data

are satisfactory and support, in our view, its or their clearance or approval.

We will be required to demonstrate through well-controlled clinical trials that Glucotrack CBGM or future

product candidates, if any, are safe and effective for their intended uses.

the Glucotrack CBGM or our future product candidates, if any, may not be cleared or approved, as the case may be, even if the clinical

data are satisfactory and support, in our view, it’s or their clearance or approval.

The FDA or other non-U.S.

regulatory authorities may disagree

with our trial design or interpretation of the clinical data.

In addition, any of these regulatory authorities may change requirements

for the clearance or approval of a product candidate even after reviewing and providing comment on a protocol for a pivotal clinical

trial that has the potential to result in FDA approval.

In addition, any of these regulatory authorities may also clear or approve a

product candidate for fewer or more limited uses than we request or may grant clearance or approval contingent on the performance of

regulatory authorities

may disagree with our trial design or interpretation of the clinical data.

In addition, any of these regulatory authorities may change

requirements for the clearance or approval of a product candidate even after reviewing and providing comment on a protocol for a pivotal

clinical trial that has the potential to result in FDA approval.

In addition, any of these regulatory authorities may also clear or approve

a product candidate for fewer or more limited uses than we request or may grant clearance or approval contingent on the performance of

costly post-marketing clinical trials.

In addition, the FDA or other non-regulatory authorities may not approve the labeling claims necessary

or desirable for the successful commercialization of GlucoTrack® or our future product candidates, if any.

are highly dependent on the success of our next generation product candidate, GlucoTrack® 2.0, and cannot give any assurance that

it will receive regulatory approval or clearance or be successfully commercialized.

are highly dependent on the success of our next generation product candidate, GlucoTrack® model 2.0.

We cannot give any assurance

that the FDA will permit us to clinically test the device, nor can we give any assurance that the clinical trials will be successful

or that GlucoTrack® 2.0 will receive regulatory clearance or approval or be successfully commercialized, for a number of reasons,

including, without limitation, the potential introduction by our competitors of more clinically-effective or cost-effective alternatives,

failure in our sales and marketing efforts, or the failure to obtain positive coverage determinations or reimbursement.

Any failure to

obtain approval to conduct clinical trials, favorable clinical data, clearance or approval of or to successfully commercialize GlucoTrack®

2.0 would have a material adverse effect on our business.

our competitors develop and market products that are more effective, safer or less expensive than GlucoTrack® or our future product

or desirable for the successful commercialization of Glucotrack CBGM or our future product candidates, if any.

are highly dependent on the success of our product candidate, Glucotrack CBGM, and cannot give any assurance that it will receive regulatory

approval or clearance or be successfully commercialized.

are highly dependent on the success of our product candidate, Glucotrack CBGM.

We cannot give any assurance that the FDA will permit

us to clinically test the device, nor can we give any assurance that the clinical trials will be successful or that GluctTrack CBGM will

receive regulatory clearance or approval or be successfully commercialized, for a number of reasons, including, without limitation, the

potential introduction by our competitors of more clinically-effective or cost-effective alternatives, failure in our sales and marketing

efforts, or the failure to obtain positive coverage determinations or reimbursement.

Any failure to obtain approval to conduct clinical

trials, favorable clinical data, clearance or approval of or to successfully commercialize Glucotrack CBGM would have a material adverse

effect on our business.

our competitors develop and market products that are more effective, safer or less expensive than Glucotrack CBGM or our future product

candidates, if any, our commercial opportunities will be adversely affected.

life sciences industry is highly competitive and we face significant competition from many medical device companies that are researching

and marketing products designed to address the needs of persons suffering from diabetes.

We are currently developing medical devices

that will compete with other medical devices that currently exist or are being developed.

Some of our competitors have significantly

greater financial, manufacturing, marketing and product development resources than we do.

Large medical device companies, in particular,

have extensive experience in clinical testing and in obtaining regulatory clearances or approvals for medical devices.

These companies

also have significantly greater research and marketing capabilities than us.

life sciences industry is highly competitive;

and we face significant competition from many medical device companies that are researching

and marketing products designed to address the needs of people suffering from diabetes.

We are currently developing medical devices that

will compete with other medical devices that currently exist or are being developed.

Some of our competitors have significantly greater

financial, manufacturing, marketing and product development resources than we do.

Large medical device companies, in particular, have

extensive experience in clinical testing and in obtaining regulatory clearances or approvals for medical devices.

These companies also

have significantly greater research and marketing capabilities than us.

Some of the medical device companies that we expect to compete

with include Roche;

LifeScan, Inc., a division of Johnson & Johnson;

the MediSense and TheraSense divisions of Abbott Laboratories;

Ascensia, a spin off from Bayer Corporation;

and Medtronic, Inc.

In addition, many other universities and private and public

research institutions are or may become active in research involving blood glucose measurement devices.

with include Abbott Laboratories, DexCom, Medtronic, and Senseonics.

In addition, many universities and private and public research institutions

are or may become active in research involving blood glucose measurement devices.

believe that our ability to successfully compete will depend on, among other things:

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ability to protect intellectual property rights related to our products.

our competitors market products that are more effective, safer, easier to use or less expensive than GlucoTrack® or our future product

candidates, if any, or that reach the market sooner than GlucoTrack® or our future product candidates, if any, we may not achieve

our competitors market products that are more effective, safer, easier to use or less expensive than Glucotrack CBGM or our future product

candidates, if any, or that reach the market sooner than Glucotrack CBGM or our future product candidates, if any, we may not achieve

commercial success.

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obsolete or less competitive.

number of medical device companies, medical researchers and pharmaceutical companies are also pursuing new delivery technologies, procedures,

drugs and other therapies for the monitoring, treatment and prevention of diabetes.

If successful, these technologies could render glucose

monitoring devices, like the Glucotrack CBGM, obsolete.

Technological breakthroughs in diabetes treatment or prevention could reduce

the potential market for Glucotrack CBGM, making it less competitive or obsolete altogether.

diabetes market is currently seeing increasing use of GLP-1 drugs for the treatment of obesity and type 2 diabetes.

While we believe

that GLP-1s are a companion product and can be used in conjunction with CGM systems, such drugs could potentially compete with the Glucotrack

CBGM and impact successful commercialization.

product development activities could be delayed or stopped.

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regulatory approval process is expensive, time-consuming and uncertain and may prevent us from obtaining approvals for the commercialization

of GlucoTrack® or our future product candidates, if any.

of Glucotrack CBGM or our future product candidates, if any.

research, testing, manufacturing, labeling, approval, selling, marketing and distribution of medical devices are subject to extensive

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We are not permitted

to market our product candidates in the United States until we receive a clearance letter under the 510(k)-premarket notification process

or approval of a Section 515 premarket approval, from the FDA, depending on the nature of the device.

We have not submitted an application

or premarket notification for or received marketing clearance or approval for any of our product candidates.

Obtaining approval of any

premarket approval can be a lengthy, expensive and uncertain process.

While the FDA normally reviews, and clears a premarket notification

in three months, there is no guarantee that our products will qualify for this more expeditious regulatory process, which is reserved

for Class I and II devices, nor is there any assurance that, even if a device is reviewed under the 510(k)-premarket notification process,

the FDA will review it expeditiously or determine that the device is substantially equivalent to a lawfully marketed non-premarket approval

If the FDA fails to make this finding, then we cannot market the device.

In lieu of acting on a premarket notification, the FDA

may seek additional information or additional data which would further delay our ability to market the product.

In addition, failure

to comply with FDA, non-U.S.

regulatory authorities or other applicable U.S.

regulatory requirements may, either before

or after product clearance or approval, if any, subject us to administrative or judicially imposed sanctions, including:

to market our product candidates in the United States until we receive a clearance letter under Section 515 premarket approval, from

We have not submitted an application or premarket notification for or received marketing clearance or approval for any of our

product candidates.

Obtaining approval of any premarket approval can be a lengthy, expensive and uncertain process, particularly those

for Class III devices under which our product falls.

In lieu of acting on a premarket notification, the FDA may seek additional information

or additional data which would further delay our ability to market the product.

In addition, failure to comply with FDA, non-U.S.

authorities or other applicable U.S.

regulatory requirements may, either before or after product clearance or approval,

if any, subject us to administrative or judicially imposed sanctions, including:

on the products, manufacturers or manufacturing process;

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to clear or approve pending applications or premarket notifications.

approval of a PMA or PMA supplement or clearance pursuant to a 510(k)-premarket notification is not guaranteed, and the approval or clearance

process, as the case may be, is expensive and may, especially in the case of the PMA, take several years.

The FDA also has substantial

discretion in the medical device clearance or approval processes.

Despite the time and expense exerted, failure can occur at any stage

and we could encounter problems that cause us to abandon clinical trials or to repeat or perform additional pre-clinical studies and

clinical trials.

The number of pre-clinical studies and clinical trials that will be required for FDA clearance or approval varies depending

on the medical device candidate, the disease or condition that the medical device candidate is designed to address, and the regulations

applicable to any particular medical device candidate.

The FDA can delay, limit or deny clearance or approval of a medical device candidate

for many reasons, including:

medical device candidate may not be deemed safe or effective, in the case of a PMA;

medical device candidate may not be deemed to be substantially equivalent to a lawfully marketed non-premarket approval device in

the case of a 510(k)-premarket notification;

approval of a PMA or PMA supplement is not guaranteed, and the approval will take several years when factoring in clinical trial timelines.

The FDA also has substantial discretion in the medical device clearance or approval processes.

Despite the time and expense exerted,

failure can occur at any stage and we could encounter problems that cause us to abandon clinical trials or to repeat or perform additional

pre-clinical studies and clinical trials.

The number of pre-clinical studies and clinical trials that will be required for FDA clearance

or approval varies depending on the medical device candidate, the disease or condition that the medical device candidate is designed

to address, and the regulations applicable to any particular medical device candidate.

The FDA can delay, limit or deny clearance or

approval of a medical device candidate for many reasons, including:

medical device candidate may not be deemed safe or effective;

officials may not find the data from the clinical trials sufficient;

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FDA may change its clearance or approval policies or adopt new regulations.

while we have received CE Mark approval for GlucoTrack® 1.0, the MDD requires only minimum harmonization.

In practice, uniform regulation

throughout the EU is not ensured.

Rather, member countries may apply and enforce the MDD’s terms differently, and certain EU member

countries may request or require performance and/or safety data additional to the MDD’s requirements from time to time, on a case-by-case

Therefore, we cannot predict whether we will be able to successfully commercialize GlucoTrack® or our future product candidates,

if any, in the EU.

to recruit and enroll patients for clinical trials may cause the development of our product candidates to be delayed.

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regulatory authorities

clear or approve GlucoTrack® or our future product candidates, if any, the labeling, packaging, adverse event reporting, storage,

clear or approve Glucotrack CBGM or our future product candidates, if any, the labeling, packaging, adverse event reporting, storage,

advertising and promotion for the product will be subject to extensive regulatory requirements.

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to market future product candidates and may not achieve or sustain profitability.

if we receive regulatory clearance or approval to market GlucoTrack® or our future product candidates, if any, the market may not

if we receive regulatory clearance or approval to market Glucotrack CBGM or our future product candidates, if any, the market may not

be receptive to our products.

if GlucoTrack® or our future product candidates, if any, obtain regulatory clearance or approval, resulting products may not gain

if Glucotrack CBGM or our future product candidates, if any, obtain regulatory clearance or approval, resulting products may not gain

market acceptance among physicians, patients, health care payors or the medical community.

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of coverage and reimbursement from government and other third-party payors.

the GlucoTrack® or our future product candidates, if any, fail to achieve market acceptance, we may not be able to generate significant

the Glucotrack CBGM or our future product candidates, if any, fail to achieve market acceptance, we may not be able to generate significant

revenue or achieve or sustain profitability.

coverage and reimbursement status of newly cleared or approved medical devices is uncertain, and failure to obtain adequate coverage

and adequate reimbursement could limit our ability to market GlucoTrack® or future product candidates, if any, and may inhibit our

ability to generate revenue from GlucoTrack® or our future product candidates, if any, that may be cleared or approved.

and adequate reimbursement could limit our ability to market Glucotrack CBGM or future product candidates, if any, and may inhibit our

ability to generate revenue from Glucotrack CBGM or our future product candidates, if any, that may be cleared or approved.

is significant uncertainty related to the third-party coverage and reimbursement of newly cleared or approved medical devices.

The commercial

success of GlucoTrack® or our future product candidates, if any, in both domestic and international markets will depend in part on

success of Glucotrack CBGM or our future product candidates, if any, in both domestic and international markets will depend in part on

the availability of coverage and adequate reimbursement from third-party payors, including government payors, such as the Medicare and

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attempting to contain health care costs by limiting both coverage and the level of reimbursement for new products and, as a result, they

may not cover or provide adequate payment for GlucoTrack® or our future product candidates, if any.

may not cover or provide adequate payment for Glucotrack CBGM or our future product candidates, if any.

These payors may conclude that

our products are not as safe or effective as existing devices or that the overall cost of using one of our devices exceeds the overall

cost of the competing device, and third-party payors may not approve GlucoTrack® or our future product candidates, if any, for coverage

cost of the competing device, and third-party payors may not approve Glucotrack CBGM or our future product candidates, if any, for coverage

and adequate reimbursement.

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The failure to obtain coverage and adequate reimbursement for

GlucoTrack® or our future product candidates, if any, or health care cost containment initiatives that limit or restrict reimbursement

Glucotrack CBGM or our future product candidates, if any, or health care cost containment initiatives that limit or restrict reimbursement

for such products may reduce any future product revenue.

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We currently maintain product liability insurance up to

$5,000 thousand per claim and in the aggregate.

Although we have product liability coverage, we may have to pay amounts awarded by a

court or negotiated in a settlement that exceed our coverage limitations or that are not covered by our insurance, and we may not have,

or be able to obtain, sufficient capital to pay such amounts.

$5,000 per claim and in the aggregate.

Although we have product liability coverage, we may have to pay amounts awarded by a court or

negotiated in a settlement that exceed our coverage limitations or that are not covered by our insurance, and we may not have, or be

able to obtain, sufficient capital to pay such amounts.

we fail to attract and retain key management and scientific personnel, we may be unable to successfully develop or commercialize Glucotrack

or our future product candidates, if any.

CBGM or our future product candidates, if any.

will need to expand and effectively manage our managerial, operational, financial, development and other resources in order to successfully

pursue our research, development and commercialization efforts for GlucoTrack® or our future product candidates, if any.

pursue our research, development and commercialization efforts for Glucotrack CBGM or our future product candidates, if any.

depends on our continued ability to attract, retain and motivate highly qualified management and pre-clinical and clinical personnel.

The loss of the services of any of our senior management could delay or prevent the development or commercialization of GlucoTrack®

The loss of the services of any of our senior management could delay or prevent the development or commercialization of Glucotrack CBGM

or our future product candidates, if any.

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our senior management team, we may not be able to find suitable replacements in a timely fashion or at all and our business may be harmed

we continue to evolve from a company primarily involved in development to a company also involved in commercialization, we may encounter

difficulties in managing our growth and expanding our operations successfully.

anticipate that, as our operations expand, we will need to expand our manufacturing, marketing and sales capabilities by contracting

with third parties.

Maintaining these relationships and managing our future growth will impose significant added responsibilities on

members of our management.

We must be able to manage our development efforts effectively;

manage our clinical trials effectively;

train and integrate additional management, development, administrative and sales and marketing personnel;

improve managerial, development,

operational and finance systems;

and expand our facilities, all of which may impose a strain on our administrative and operational infrastructure.

rely on third parties to manufacture and supply our product.

do not own or operate manufacturing facilities for clinical or commercial production of GlucoTrack®, other than a prototype lab.

We have no experience in medical device manufacturing and lack the resources and the capability to manufacture the GlucoTrack® on

do not own or operate manufacturing facilities for clinical or commercial production of Glucotrack CBGM, other than a prototype lab.

We have no experience in medical device manufacturing and lack the resources and the capability to manufacture the Glucotrack CBGM on

a commercial scale.

To date we have manufactured GlucoTrack® with a third-party manufacturer in Israel.

To date we have manufactured Glucotrack CBGM with a third-party manufacturer in Israel.

our manufacturing partners are unable to produce our products in the amounts, timing or pricing that we require, we may not be able to

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We expect to depend on third-party contract manufacturers for the foreseeable future.

does, and our future product candidates, if any, likely will require precise, high quality manufacturing.

CBGM does, and our future product candidates, if any, likely will require precise, high quality manufacturing.

Any of our contract manufacturers

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on acceptable terms in a timely manner, or at all.

clinical investigators and contract research organizations that we may engage to conduct our clinical trials may not be diligent,

careful or timely.

clinical investigators and contract research organizations that we may engage to conduct our clinical trials may not be diligent, careful

will depend on independent clinical investigators to conduct our clinical trials.

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affect the clinical development of our product candidates and harm our business.

business may become subject to economic, political, regulatory and other risks associated with international operations, which could

harm our business.

business is subject to risks associated with conducting business internationally.

Accordingly, our future results could be harmed by

a variety of factors, including:

in compliance with non-U.S.

laws and regulations;

regulations and customs;

currency exchange rates and currency controls;

in a specific country’s or region’s political or economic environment;

protection measures, import or export licensing requirements or other restrictive actions by U.S.

consequences from changes in tax laws;

associated with staffing and managing foreign operations, including differing labor relations.

may not be able to enforce covenants not-to-compete under current Israeli law, which might result in added competition for our products.

have non-competition agreements or provisions with all of our employees and executive officers, all of which are governed by Israeli

These agreements or provisions prohibit our employees from competing with us or working for our competitors, generally during, and

for up to nine months after termination of, their employment with us.

However, Israeli courts are reluctant to enforce non-compete undertakings

of former employees and tend, if at all, to enforce those provisions for only relatively brief periods of time or in restricted geographical

In addition, Israeli courts typically require the presence of additional circumstances, such as a demonstration of an employer’s

legitimate interest which was damaged;

breach of fiduciary duties, loyalty and acting not in good faith;

a payment of a special consideration

for employee’s non-compete obligation;

material concern for disclosing employer’s trade secrets;

or a demonstration that

an employee has unique value to the employer specific to that employer’s business, before enforcing a non-competition undertaking

against such employee.

funding that we received through the Israeli Innovation Authority (“IIA”) for research and development activities restricts

our ability to manufacture products or to transfer technology outside of Israel.

March 4, 2004, the IIA agreed to provide us with a grant of 420 New Israeli Shekels (“NIS”), or approximately $93 at an exchange

rate of 4.502 NIS/dollar (the exchange rate in effect on such date), for our plan to develop a non-invasive blood glucose monitor (the

“development plan”).

This grant constituted 60% of our research and development budget for the development plan at that time.

Due to our acceptance of this grant, we are subject to the provisions of the Israeli Law for the Encouragement of Industrial Research

and Development, 1984 (the “R&D Law”).

Among other things, the R&D Law restricts our ability to sell or transfer

rights in technology or know-how developed with IIA funding or transfer any Means of Control (as defined in the R&D Law) of us to

non-Israeli entities.

The Industrial Research and Development Committee at the IIA (the “research committee”) may, under

special circumstances, approve the transfer outside of Israel of rights in technology or know-how developed with IIA funding subject

to certain conditions, including the condition that certain payments be made to the IIA.

Additionally, we may not manufacture products

developed with IIA funding outside of Israel without the approval of the research committee.

The restrictions regarding the sale or transfer

of technology or manufacturing rights out of Israel could have a material adverse effect on our ability to enter into strategic alliances

or enter into merger or acquisition transactions in the future that provide for the sale or transfer of our technology or manufacturing

Related to Intellectual Property

we are unable to obtain and enforce patent protection for our products, our business could be materially harmed.

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For this and other reasons, we may be unable to secure desired patent rights, thereby losing desired exclusivity.

Although we do not believe that we need any licenses for GlucoTrack®, we may need to obtain licenses in the future for other products

Although we do not believe that we need any licenses for Glucotrack CBGM, we may need to obtain licenses in the future for other products

or in certain circumstances, such as if one of our patents were declared invalid in the future.

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would impair our competitive position and may materially harm our business, financial condition and results of operations.

jurisdictions may require us to grant licenses to third parties.

Such compulsory licenses could be extended to include some of our product

candidates, which may limit potential revenue opportunities.

countries, including certain countries in Europe, have compulsory licensing laws under which a patent owner may be compelled to grant

licenses to third parties.

In addition, most countries limit the enforceability of patents against government agencies or government

In these countries, the patent owner may be limited to monetary relief and may be unable to enjoin infringement, which could

materially diminish the value of the patent.

Compulsory licensing of life-saving products is also becoming increasingly popular in developing

countries, either through direct legislation or international initiatives.

Such compulsory licenses could be extended to include some

of our product candidates, which may limit our potential revenue opportunities.

commercial success depends significantly on our ability to operate without infringing the patents and other proprietary rights of third

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to sustain operations.

governments often impose strict price controls, which may adversely affect our future profitability.

intend to seek approval to market GlucoTrack® and our future product candidates, if any, in both the U.S.

and in non-U.S.

jurisdictions.

If we obtain approval in one or more non-U.S.

jurisdictions, we will be subject to rules and regulations in those jurisdictions relating

to our products.

In some countries, particularly countries of the EU, each of which has developed its own rules and regulations, pricing

may be subject to governmental control under certain circumstances.

In these countries, pricing negotiations with governmental authorities

can take considerable time after the receipt of marketing approval for a medical device candidate.

Each of the EU member states has its

own unique legal system and thus it is difficult to predict the particular requirements to which we may be subject.

To obtain reimbursement

or pricing approval in some countries, we may be required to conduct a clinical trial that compares the cost-effectiveness of our product

to other available products.

If reimbursement of our product candidates is unavailable or limited in scope or amount, or if pricing is

set at unsatisfactory levels, we may be unable to achieve or sustain profitability.