What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2024-03-28 compared with 2023-03-30 · 448 added, 332 removed, 761 unchanged (51% of the section changed)

12 unchanged sentences

affected if we are unable to obtain needed funding.

have generated no revenue from commercial operations to date and have an accumulated deficit.

We anticipate that we will incur losses

for the foreseeable future.

have generated an insignificant amount of revenue from commercial operations to date and have an accumulated deficit.

We anticipate

that we will incur losses for the foreseeable future.

We may never achieve or sustain profitability.

had previously identified a material weakness in our internal control over financial reporting which has been remediated.

material weakness, our discovery of any additional weaknesses, and our inability to achieve and maintain effective internal control

over financial reporting, could adversely affect our results of operations, our stock price and investor confidence in our company.

COVID-19 pandemic could continue to adversely impact our business, including clinical trials.

44 unchanged sentences

affected if we are unable to obtain needed funding.

ended December 31, 2022 with approximately $1.2 million of operating cash on-hand and will need to raise additional capital in the

second quarter and beyond to fund operations.

If we do not raise additional capital from outside sources before or during the second

quarter of 2023, we may be forced to further curtail or cease our operations.

Based on these circumstances, our ability to continue

as a going concern is at risk and our independent registered public accounting firm included a “going concern”

explanatory paragraph as to our ability to continue as a going concern in their audit report dated March 30, 2023, included in this

Our cash requirements and cash resources will vary significantly depending upon the timing, and the financial and other

resources that will be required to complete ongoing development and pre-clinical and clinical testing of our product candidates,

regulatory efforts and collaborative arrangements necessary for our product candidates that are currently under development.

addition to development and other costs, we expect to incur capital expenditures from time to time.

These capital expenditures will

be influenced by our regulatory compliance efforts, our success, if any, at developing collaborative arrangements with strategic

partners, our needs for additional facilities and capital equipment and the growth, if any, of our business in general.

require additional funding to continue our anticipated operations and support our capital and operating needs.

We are currently

seeking and will continue to seek financings from other existing and/or new investors to raise necessary funds through a combination

of public or private equity offerings.

We may also pursue debt financings, other financing mechanisms, strategic collaborations and

licensing arrangements.

We may not be able to obtain additional financing on terms favorable to us, if at all.

In addition, general

market conditions, including the effects of Russia’s invasion of Ukraine and attendant economic sanctions, high inflation,

rising interest rates and the COVID-19 pandemic on financial markets, as well as the effects of laws and regulations on foreign

investment in the United States under the jurisdiction of the Committee on Foreign Investment in the United States (CFIUS), and

other agencies and related regulations, including the Foreign Investment Risk Review Modernization Act (FIRRMA), adopted in August

2018, may make it difficult for us to seek financing from the capital markets.

ended the year 2023 with approximately $0.4 million of operating cash on-hand and received debt financing of $0.5 million in

gross proceeds subsequent to December 31, 2023 and will need to raise additional capital in the first quarter and beyond to

fund operations.

If we do not raise additional capital from outside sources during the first quarter of 2024, we may be

forced to further curtail or cease our operations.

Based on these circumstances, our ability to continue as a going concern is at

risk and our independent registered public accounting firm included a “going concern” explanatory paragraph as to our

ability to continue as a going concern in their audit report dated March 28, 2024, included in this Form 10-K.

Our cash requirements

and cash resources will vary significantly depending upon the timing, and the financial and other resources that will be required to

complete ongoing development and pre-clinical and clinical testing of our product candidates, regulatory efforts and collaborative

arrangements necessary for our product candidates that are currently under development.

In addition to development and other costs,

we expect to incur capital expenditures from time to time.

These capital expenditures will be influenced by our regulatory

compliance efforts, our success, if any, at developing collaborative arrangements with strategic partners, our needs for additional

facilities and capital equipment and the growth, if any, of our business in general.

We will require additional funding to continue

our anticipated operations and support our capital and operating needs.

We are currently seeking and will continue to seek

financings from other existing and/or new investors to raise necessary funds through a combination of public or private equity

We may also pursue debt financings, other financing mechanisms, strategic collaborations and licensing arrangements.

may not be able to obtain additional financing on terms favorable to us, if at all.

In addition, general market conditions,

including the effects of Russia’s invasion of Ukraine and attendant economic sanctions, high inflation, rising interest rates

and the COVID-19 pandemic on financial markets, as well as the effects of laws and regulations on foreign investment in the United

States under the jurisdiction of the Committee on Foreign Investment in the United States (CFIUS), and other agencies and related

regulations, including the Foreign Investment Risk Review Modernization Act (FIRRMA), adopted in August 2018, may make it difficult

for us to seek financing from the capital markets.

additional equity financings could result in significant dilution to our stockholders and possible restrictions on subsequent financings.

56 unchanged sentences

and other employees may voluntarily terminate their employment at any time upon short notice.

In February 2020, our Chief Executive Officer

James McGorry resigned;

and in July 2019, our Chief Financial Officer Thomas McNaughton resigned;

and in October 2020, we determined

that Peter Chakoutis, our former Vice President of Finance, who had been on a temporary leave of absence for personal reasons, would

not be returning to us.

The loss of the services of any member of our senior management team, including our Chief Executive Officer

David Green, our President Hong Yu, our Chief Scientific Officer Dr.

William Fodor, and our Chief Financial Officer Joseph Damasio,

and our other key scientific, technical and management personnel, may significantly delay or prevent the achievement of product development

and other business objectives.

We can give no assurance that we could find satisfactory replacements for our current and future key scientific

and management employees, including recently terminated executives, on terms that would not be unduly expensive or burdensome to us.

The loss of the services of any member

of our senior management team, including our Chief Executive Officer Jerry He, our President Hong Yu, our Chief Scientific Officer Dr.

William Fodor, and our Chief Financial Officer Joseph Damasio, and our other key scientific, technical and management personnel, may

significantly delay or prevent the achievement of product development and other business objectives.

We can give no assurance that we

could find satisfactory replacements for our current and future key scientific and management employees, including recently terminated

executives, on terms that would not be unduly expensive or burdensome to us.

our collaborators do not devote sufficient time and resources to successfully carry out their duties or meet expected deadlines, we may

24 unchanged sentences

or slow our product and technology development efforts.

previously identified a material weakness in our internal control over financial reporting that has been remediated.

This prior weakness,

our discovery of any additional weaknesses, and our inability to achieve and maintain effective internal control over financial reporting,

could adversely affect our results of operations, our stock price and investor confidence in our company.

404 of the Sarbanes-Oxley Act of 2002 requires that companies evaluate and report on their systems of internal control over financial

As disclosed in more detail under “Controls and Procedures” in Part II, Item 9A of this Annual Report on Form 10-K, we remediated

a material weakness that existed as of December 31, 2020 in our internal control over financial reporting resulting from our failure

to design or maintain effective internal controls over the timely identification and recording of financial statement adjustments.

Specifically,

we did not identify, analyze, record, and disclose certain non-routine accounting matters, such as a lease extension and a grant contract,

timely and accurately.

this weakness has been remediated, we may in the future identify additional internal control deficiencies that could rise to the level

of a material weakness or uncover errors in financial reporting.

During the course of our evaluation, we may identify areas requiring

improvement and may be required to design additional enhanced processes and controls to address issues identified through this review.

In addition, there can be no assurance that our internal control over financial reporting will be effective as a result of these efforts

or that any such future deficiencies identified may not be material weaknesses that would be required to be reported in future periods.

as a result of deficiencies in our internal control over financial reporting we cannot provide reliable financial statements, our business

decision processes may be adversely affected, our business and results of operations could be harmed, investors could lose confidence

in our reported financial information and our ability to obtain additional financing, or additional financing on favorable terms, could

be adversely affected.

In addition, if we fail to remediate this material weakness and maintain an effective system of internal control

over financial reporting, we may not be able to rely on the integrity of our financial results, which could result in inaccurate or late

reporting of our financial results, as well as delays or the inability to meet our reporting obligations or to comply with SEC rules

and regulations.

Any of these could result in delisting actions, result in investigation and sanctions by regulatory authorities, impair

our ability to produce accurate financial statements on a timely basis, lead to a restatement of our financial statements and adversely

affect our business and the trading price of our common stock.

perception of ethical and social issues surrounding the use of cell technology may limit or discourage the use of our technologies, which

may reduce the demand for our products and technologies and reduce our revenues.

success will depend in part upon our and our collaborators’ ability to develop therapeutic approaches incorporating, or

discovered through, the use of cells.

If bioengineered organ implant technology is perceived negatively by the public for

social, ethical, medical or other reasons, governmental authorities in the U.S.

and other countries may call for prohibition of, or

limits on, cell-based technologies and other approaches to bioengineering and tissue engineering.

product candidates have not, to date, used the more controversial stem cells derived from human embryos or fetuses in the human

transplant surgeries using our product candidates, claims that human-derived stem cell technologies are ineffective or unethical may

influence public attitudes.

The subject of cell and stem cell technologies in general has at times received negative publicity and

aroused public debate in the U.S.

success will depend in part upon our and our collaborators’ ability to develop therapeutic approaches incorporating, or discovered

through, the use of cells.

If bioengineered organ implant technology is perceived negatively by the public for social, ethical, medical

or other reasons, governmental authorities in the U.S.

and other countries may call for prohibition of, or limits on, cell-based technologies

and other approaches to bioengineering and tissue engineering.

Although our product candidates have not, to date, used the more controversial

stem cells derived from human embryos or fetuses in the human transplant surgeries using our product candidates, claims that human-derived

stem cell technologies are ineffective or unethical may influence public attitudes.

The subject of cell and stem cell technologies in

general has at times received negative publicity and aroused public debate in the U.S.

and some other countries.

Ethical and other concerns about such cells could materially harm the

market acceptance of our product candidates.

Ethical and other concerns

about such cells could materially harm the market acceptance of our product candidates.

products will subject us to liability exposure.

face an inherent risk of product liability claims, especially with respect to our products that will be used within the human body,

including the scaffolds we manufacture.

Product liability coverage is expensive and sometimes difficult to obtain, if it can be

obtained at all.

face an inherent risk of product liability claims, especially with respect to our products that will be used within the human body, including

the scaffolds we manufacture.

Product liability coverage is expensive and sometimes difficult to obtain, if it can be obtained at all.

We may not be able to obtain or maintain insurance at a reasonable cost.

We have and in the future may be subject

to claims for liabilities for unsuccessful outcomes of surgeries involving our products, which may include claims relating to

patient suffering and death.

We may also be subject to claims for liabilities relating to patients that suffer serious complications

or death during or following implantations involving our products, including the patients who had surgeries utilizing our

first-generation scaffold device or our bioreactor technology or our esophageal implant, or patients that may have surgeries

utilizing any of our products in the future.

As further described below under the heading “Item 3.

Legal Proceedings,”

on April 27, 2022, we and Harvard Bioscience executed a settlement, relating to an ongoing wrongful death lawsuit, which resolved

all claims relating to the litigation.

The settlement resulted in the dismissal with prejudice of the wrongful death claim, and

neither we nor Harvard Bioscience admitted any fault or liability in connection with the claim.

The settlement also resolved any and

all claims by and between the parties and our products liability insurance carriers, which resulted in the dismissal with prejudice

of all claims asserted by or against those carriers, us and Harvard Bioscience.

Our current product liability coverage is $5 million

per occurrence and in the aggregate.

We will need to increase our insurance coverage if and when we begin commercializing any of our

There can be no assurance that existing insurance coverage will extend to other products in the future.

liability insurance coverage may not be sufficient to satisfy all liabilities resulting from product liability claims.

insurance carriers may deny that coverage exists after a claim is made.

A successful claim may prevent us from obtaining adequate

product liability insurance in the future on commercially desirable items, if at all.

If claims against us substantially exceed our

coverage, then our business could be adversely impacted.

Regardless of whether we are ultimately successful in any product liability

litigation, such litigation could consume substantial amounts of our financial and managerial resources and could result in, among

We have and in the future may be subject to claims for liabilities

for unsuccessful outcomes of surgeries involving our products, which may include claims relating to patient suffering and death.

also be subject to claims for liabilities relating to patients that suffer serious complications or death during or following implantations

involving our products, including the patients who had surgeries utilizing our first-generation scaffold device or our bioreactor technology

or our esophageal implant, or patients that may have surgeries utilizing any of our products in the future.

On April 27, 2022, we and

Harvard Bioscience executed a settlement, relating to an ongoing wrongful death lawsuit, which resolved all claims relating to the litigation.

The settlement resulted in the dismissal with prejudice of the wrongful death claim, and neither we nor Harvard Bioscience admitted any

fault or liability in connection with the claim.

The settlement also resolved any and all claims by and between the parties and our products

liability insurance carriers, which resulted in the dismissal with prejudice of all claims asserted by or against those carriers, us

and Harvard Bioscience.

Our current product liability coverage is $10 million per occurrence and in the aggregate.

We will need to increase

our insurance coverage if and when we begin commercializing any of our products.

There can be no assurance that existing insurance coverage

will extend to other products in the future.

Any product liability insurance coverage may not be sufficient to satisfy all liabilities

resulting from product liability claims.

Furthermore, insurance carriers may deny that coverage exists after a claim is made.

claim may prevent us from obtaining adequate product liability insurance in the future on commercially desirable items, if at all.

claims against us substantially exceed our coverage, then our business could be adversely impacted.

Regardless of whether we are ultimately

successful in any product liability litigation, such litigation could consume substantial amounts of our financial and managerial resources

and could result in, among others:

awards or judgments against us;

18 unchanged sentences

Failure to obtain adequate reimbursement

would result in reduced sales of our products, which could have a material adverse effect on our business, financial

condition and results of operations.

would result in reduced sales of our products, which could have a material adverse effect on our business, financial condition and results

of operations.

depend upon single-source suppliers for the hardware used for our proprietary automatic cell seeder, bioreactor control and acquisition

6 unchanged sentences

If we were unable to acquire hardware or other products or services from applicable single-source suppliers,

we could experience a delay in developing and manufacturing our products, which could have a material adverse effect on our business, financial

condition and results of operations.

we could experience a delay in developing and manufacturing our products, which could have a material adverse effect on our business,

financial condition and results of operations.

use and generate hazardous materials in our business and must comply with environmental laws and regulations, which can be expensive.

28 unchanged sentences

These other organs are more complex than the esophagus and airways.

There is no assurance that we

will be able to successfully apply our technologies to these other more complex organs, which might limit our expected growth.

There is no assurance

that we will be able to successfully apply our technologies to these other more complex organs, which might limit our expected growth.

success will depend partly on our ability to operate without infringing on, or misappropriating, the intellectual property or confidentiality

12 unchanged sentences

order to protect or enforce our patent and trademark rights, we may initiate litigation against third parties.

become subject to interference proceedings conducted in the patent and trademark offices of various countries to determine the

priority of inventions.

The defense and prosecution, if necessary, of intellectual property suits, interference proceedings and

related legal and administrative proceedings would be costly and may divert our technical and management personnel from their normal

responsibilities.

We may not prevail in any of these suits should they occur.

An adverse determination of any litigation or defense

proceedings could put our patents at risk of being invalidated or interpreted narrowly and could put our patent applications at risk

of being rejected and patents not being issued.

We may also become subject

to interference proceedings conducted in the patent and trademark offices of various countries to determine the priority of inventions.

The defense and prosecution, if necessary, of intellectual property suits, interference proceedings and related legal and administrative

proceedings would be costly and may divert our technical and management personnel from their normal responsibilities.

We may not prevail

in any of these suits should they occur.

An adverse determination of any litigation or defense proceedings could put our patents at risk

of being invalidated or interpreted narrowly and could put our patent applications at risk of being rejected and patents not being issued.

because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some

38 unchanged sentences

on our operating results, financial condition and future growth prospects.

property rights do not necessarily address all potential threats to our competitive advantage.

degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations,

and may not adequately protect our business, or permit us to maintain our competitive advantage.

The following examples are illustrative:

or any collaborators might not have been the first to make the inventions covered by the issued patents or pending patent applications

may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our intellectual

property rights;

is possible that our pending patent applications will not lead to issued patents;

competitors might conduct research and development activities in the United States and other countries that provide a safe harbor

from patent infringement claims for certain research and development activities, as well as in countries where we do not have patent

rights, and then use the information learned from such activities to develop competitive products for sale in our major commercial

may not develop additional proprietary technologies that are patentable.

competitors and potential competitors may have greater resources than we have and may develop products and technologies that are more

19 unchanged sentences

operating results and financial condition.

Cyber-attacks

or other failures in telecommunications or information technology systems and deficiency in our, or those of third parties upon which

we rely, cybersecurity could result in information theft, data corruption and significant disruption of our business operations.

the ordinary course of business, we and the third parties upon which we rely and may process proprietary, confidential, and sensitive

data, including personal data (such as health-related data), intellectual property, and trade secrets (collectively, sensitive information).

Cyber-attacks, malicious internet-based activity, online and offline fraud, and other similar activities threaten the confidentiality,

integrity, and availability of our sensitive information and information technology systems, and those of the third parties upon which

Such threats are prevalent and continue to rise, are increasingly difficult to detect, and come from a variety of sources, including

traditional computer “hackers,” threat actors, “hacktivists,” organized criminal threat actors, personnel (such

as through theft or misuse), sophisticated nation states, and nation-state-supported actors.

actors now engage and are expected to continue to engage in cyber-attacks, including without limitation nation-state actors for geopolitical

reasons and in conjunction with military conflicts and defense activities.

During times of war and other major conflicts, we and the

third parties upon which we rely may be vulnerable to a heightened risk of these attacks, including retaliatory cyber-attacks, that could

materially disrupt our systems and operations, supply chain, and ability conduct our research and development programs and our clinical

We and the third parties upon which we rely may be subject to a variety of evolving threats, including but not limited to social-engineering

attacks (including through phishing attacks and deep fakes, which may be increasingly more difficult to identify as fake), malicious

code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks,

credential stuffing attacks, credential harvesting, personnel misconduct or error, ransomware attacks, supply-chain attacks, software

bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications

failures, and other similar threats.

In particular, severe ransomware attacks are becoming increasingly prevalent and severe and can

lead to significant interruptions in our operations, disruption of clinical trials, loss of sensitive data (including data related to

clinical trials), loss of income, reputational harm, and diversion of funds.

Extortion payments may alleviate the negative impact of

a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting

such payments.

Remote work has become more common and has increased risks to our information technology systems and data, as more of

our employees utilize network connections, computers, and devices outside of our premises or network, including working at home, while

in transit and in public locations.

Future or past business transactions (such as acquisitions or integrations) could expose us to additional

cybersecurity risks and vulnerabilities, as our systems could be negatively affected by vulnerabilities present in acquired or integrated

entities’ systems and technologies.

addition, our reliance on third-party service providers could introduce new cybersecurity risks and vulnerabilities, including supply-chain

attacks, and other threats to our business operations.

We may rely on third- party service providers and technologies to operate critical

business systems to process sensitive information in a variety of contexts, including, without limitation, third-party providers of information

technology infrastructure, cloud-based infrastructure, encryption and authentication technology, employee email, content delivery to

customers, CROs for managing clinical trial data, and other functions.

We may also rely on third-party service providers to provide other

products, services, parts, or otherwise operate our business.

Our ability to monitor these third parties’ information security

practices is limited, and these third parties may not have adequate information security measures in place.

If our third-party service

providers experience a security incident or other interruption, we could experience adverse consequences.

While we may be entitled to

damages if our third-party service providers fail to satisfy their privacy or security-related obligations to us, the liability of such

third party may be limited such that any award may be insufficient to cover our damages, or we may be unable to recover any such award.

In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties’ infrastructure

in our supply chain or our third-party partners’ supply chains have not been compromised.

may expend significant resources or modify certain of our business activities (which could include our clinical trial activities) to

try to protect against security incidents.

Certain data privacy and security obligations may require us to implement and maintain specific

security measures, industry-standard or reasonable security measures to protect our information technology systems and sensitive information.

we have established physical, electronic and organizational security measures designed to safeguard and secure our systems against security

incidents, there can be no assurance that these measures will be effective.

We take steps designed to detect, mitigate and remediate

vulnerabilities in our information technology systems (such as our hardware and/or software, including that of third parties upon which

We may not, however, detect and remediate all such vulnerabilities including on a timely basis.

Further, we may experience

delays in developing and deploying remedial measures and patches designed to address identified vulnerabilities.

Vulnerabilities

could be exploited and result in a security incident.

Any of the previously identified or similar threats could cause a security incident

or other interruption that could result in unauthorized, unlawful, or accidental acquisition, modification, destruction, loss, alteration,

encryption, disclosure of, or access to our sensitive information or our information technology systems, or those of the third parties

upon whom we rely.

A security incident or other interruption could disrupt our ability (and that of third parties upon whom we rely)

to provide our products.

For example, the loss of clinical trial data from completed or ongoing or planned clinical trials could result

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

data privacy and security obligations may require us to notify relevant stakeholders of security incidents.

Such disclosures are costly,

and the disclosure or the failure to comply with such requirements could lead to adverse consequences.

If we (or a third party upon whom

we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences.

These consequences may include:

government enforcement actions (for example, investigations, fines, penalties, audits, and inspections);

additional reporting requirements and/or oversight; restrictions on processing sensitive information (including personal data);

litigation (including class-action claims); indemnification obligations; negative publicity; reputational harm; monetary

fund diversions; interruptions in our operations (including availability of data); financial loss; and other similar harms.

contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in

our contracts are sufficient to protect us from liabilities, damages, or claims related to our data privacy and security obligations.

We cannot be sure that our insurance coverage will be adequate or sufficient to protect us from or to mitigate liabilities arising out

of our privacy and security practices, that such coverage will continue to be available on commercially reasonable terms or at all, or

that such coverage will pay future claims.

addition to experiencing a security incident, third parties may gather, collect, or infer sensitive information about us from public

sources, data brokers, or other means that reveals competitively sensitive details about our organization and could be used to undermine

our competitive advantage or market position.

we do not successfully manage our growth, our business goals may not be achieved.

31 unchanged sentences

events following the surgeries, including serious health complications or death, which may or may not be related to materials provided

In 2017, our esophageal implant candidate was used in a human surgery at Mayo Clinic via an FDA-approved single-use expanded

access application.

In 2013 and 2014 we had provided a previous generation trachea scaffold device that was used in implants in human

patients under compassionate use.

To date, we believe that at least four of the six patients who received those tracheal implants have

While we believe that none of those patients died because of a failure of the applicable device, these and any other such events

have and may cause or contribute to the delay or termination of our clinical trials or pre-clinical development efforts.

termination of our pre-clinical development efforts or clinical trials will delay the filing of our product submissions and, ultimately,

our ability to commercialize our products and generate revenues.

It is also possible that patients enrolled in clinical trials will experience

adverse side effects that are not currently part of the product candidate’s profile.

In 2017, our esophageal implant candidate was used in a human surgery at Mayo Clinic via an FDA-approved single-use expanded access

In 2013 and 2014 we had provided a previous generation trachea scaffold device that was used in implants in human patients

under compassionate use.

To date, we believe that at least four of the six patients who received those tracheal implants have died.

we believe that none of those patients died because of a failure of the applicable device, these and any other such events have and may

cause or contribute to the delay or termination of our clinical trials or pre-clinical development efforts.

Any delay or termination

of our pre-clinical development efforts or clinical trials will delay the filing of our product submissions and, ultimately, our ability

to commercialize our products and generate revenues.

It is also possible that patients enrolled in clinical trials will experience adverse

side effects that are not currently part of the product candidate’s profile.

approval delays due to COVID-19

86 unchanged sentences

commercially distribute and market these products would be adversely impacted.

currently do not have regulatory approval to market any of our implant product candidates, including those for the esophagus,

or trachea and bronchus.

Our product candidates are subject to rigorous regulation by the FDA, and numerous other federal and state governmental

authorities in the U.S., as well as foreign governmental authorities.

In the U.S., the FDA permits commercial distribution of new medical

products only after approval of a Premarket Approval, or PMA, New Drug Application, or NDA, or BLA, unless the product is specifically

exempt from those requirements.

currently do not have regulatory approval to market any of our implant product candidates, including those for the esophagus, colon,

Our product candidates are subject to rigorous regulation by the FDA, and numerous other federal and state governmental authorities

in the U.S., as well as foreign governmental authorities.

In the U.S., the FDA permits commercial distribution of new medical products

only after approval of a Premarket Approval, or PMA, New Drug Application, or NDA, or BLA, unless the product is specifically exempt

from those requirements.

A PMA, NDA or BLA must be supported by extensive data, including, but not limited to, technical, pre-clinical,

11 unchanged sentences

not employed or affiliated with our company, and we did not pay him any compensation or consulting fees.

In June 2014, we ceased support of any human surgeries with Dr.

Since the time we withdrew

from involvement with Dr.

In June 2014, we ceased support

of any human surgeries with Dr.

Since the time we withdrew from involvement with Dr.

Macchiarini, allegations that Dr.

Macchiarini had failed to obtain informed consent and accurately report patient

conditions, among other things, for surgeries performed at the Karolinska Institutet in Stockholm, Sweden, were made public.

had failed to obtain informed consent and accurately report patient conditions, among other things, for surgeries performed at the Karolinska

Institutet in Stockholm, Sweden, were made public.

Karolinska Institutet investigated the allegations and concluded that while in some instances Dr.

16 unchanged sentences

In May 2022, Dr.

Macchiarini was tried in Solna District Court in Sweden

for aggravated assault against three patients treated at the Karolinska University Hospital.

Macchiarini was tried in Solna District Court in Sweden for

aggravated assault against three patients treated at the Karolinska University Hospital.

On June 16, 2022, Dr.

Macchiarini was acquitted

in two of these cases and in the third was found guilty of causing bodily harm to the patient and was given a suspended sentence for two

These allegations, the results of the investigation and any further actions that

may be taken in connection with these matters, have and may continue to harm the perception of our product candidates or company and

make it difficult to recruit patients for any clinical trials, which could have a material adverse effect on our business, financial

condition or results of operations.

FDA has informed us that our esophageal implant would be viewed by the FDA as a combination product comprised of a biologic, or

cells, and a medical device component.

in two of these cases and in the third was found guilty of causing bodily harm to the patient and was given a suspended sentence for

These allegations, the results of the investigation and any further actions that may be taken in connection with these matters,

have and may continue to harm the perception of our product candidates or company and make it difficult to recruit patients for any clinical

trials, which could have a material adverse effect on our business, financial condition or results of operations.

FDA has informed us that our esophageal implant would be viewed by the FDA as a combination product comprised of a biologic, or cells,

and a medical device component.

Nevertheless, we cannot be certain how the FDA will regulate our products.

The FDA may require

us to obtain marketing clearance and approval from multiple FDA centers.

The review of combination products is often more complex and

more time consuming than the review of products under the jurisdiction of only one center within the FDA.

the FDA has informed us that our esophageal implant would be regulated by the FDA as a combination product, we cannot be certain

that any of our other products would also be regulated by the FDA as a combination product.

For a combination product, the Office of

Combination Products, or OCP, within FDA can determine which center or centers within the FDA will review the product and under what

legal authority the product will be reviewed.

Generally, the center within the FDA that has the primary role in regulating a combination

product is determined based on the primary mode of action of the product.

Generally, if the primary mode of action is as a device, the

FDA’s Center for Devices and Radiological Health, or CDRH, takes the lead.

Alternatively, if the primary mode of action is cellular,

then the CBER takes the lead.

On October 18, 2016, we also received written confirmation from the CBER that the FDA intends to regulate

our esophageal implant as a combination product under the primary jurisdiction of CBER.

We further understand that CBER may

choose to consult or collaborate with CDRH with respect to the characteristics of the synthetic scaffold component of our product based

on CBER’s determination of need for such assistance.

The FDA may require us to

obtain marketing clearance and approval from multiple FDA centers.

The review of combination products is often more complex and more

time consuming than the review of products under the jurisdiction of only one center within the FDA.

the FDA has informed us that our esophageal implant would be regulated by the FDA as a combination product, we cannot be certain that

any of our other products would also be regulated by the FDA as a combination product.

For a combination product, the Office of Combination

Products, or OCP, within FDA can determine which center or centers within the FDA will review the product and under what legal authority

the product will be reviewed.

Generally, the center within the FDA that has the primary role in regulating a combination product is determined

based on the primary mode of action of the product.

Generally, if the primary mode of action is as a device, the FDA’s Center for

Devices and Radiological Health, or CDRH, takes the lead.

Alternatively, if the primary mode of action is cellular, then the CBER takes

On October 18, 2016, we also received written confirmation from the CBER that the FDA intends to regulate our esophageal implant

as a combination product under the primary jurisdiction of CBER.

We further understand that CBER may choose to consult or collaborate

with CDRH with respect to the characteristics of the synthetic scaffold component of our product based on CBER’s determination

of need for such assistance.

process of obtaining FDA marketing approval is lengthy, expensive, and uncertain, and we cannot be certain that our product candidates,

4 unchanged sentences

and/or different legal authority, in which case the path to regulatory approval would be different and could be more lengthy and costly.

the FDA does not approve or clear our products in a timely fashion, or at all, our business, financial condition or operations will

be adversely affected.

the FDA does not approve or clear our products in a timely fashion, or at all, our business, financial condition or operations will be

adversely affected.

the E.U., our esophagus product candidate will likely be regulated as a combined advanced therapy medicinal product and our other product

candidates, including for the trachea or bronchus, may also be viewed as advanced therapy medicinal products, which could delay approvals

candidates, including for the colon and uterus, may also be viewed as advanced therapy medicinal products, which could delay approvals

and clearances and increase costs of obtaining such approvals and clearances.

May 28, 2014, we received notice from the European Medicines Agency, or EMA, that our first-generation trachea product candidate would

be regulated as a combined advanced therapy medicinal product.

May 28, 2014, we received notice from the European Medicines Agency, or EMA, that our first-generation trachea product candidate

would be regulated as a combined advanced therapy medicinal product.

While we have not had any formal interaction with the EMA with respect

to our esophageal implant, we believe that such implant technology would likely be regulated as a combined advanced therapy

medicinal product.

In the event of such classification, it would be necessary to seek a marketing authorization for these products granted

by the European Commission before being marketed in the E.U.

to our esophageal implant, we believe that such implant technology would likely be regulated as a combined advanced therapy medicinal

In the event of such classification, it would be necessary to seek a marketing authorization for these products granted by the

European Commission before being marketed in the E.U.

products we may develop, including any products pertaining to the airways or otherwise, may similarly be regulated as advanced therapy

45 unchanged sentences

to grant export approval for our products;

The occurrence of any of these events could have a material adverse effect on our business, financial condition or results of operations.

occurrence of any of these events could have a material adverse effect on our business, financial condition or results of operations.

enforcement actions can generate adverse commercial consequences.

15 unchanged sentences

affect our business, operating results and prospects.

Related to Our Separation from Harvard Bioscience

may have received better terms from unaffiliated third parties than the terms we received in our agreements with Harvard Bioscience.

agreements related to the Separation, including the separation and distribution agreement, tax sharing agreement, transition services

agreement and the other agreements, were negotiated in the context of the Separation while we were still part of Harvard Bioscience and,

accordingly, may not reflect terms that would have resulted from arm’s-length negotiations among unaffiliated third parties.

terms of the agreements we negotiated in the context of the Separation related to, among other things, allocation of assets, liabilities,

rights, indemnifications and other obligations among Harvard Bioscience and us.

We may have received better terms from third parties

because third parties may have competed with each other to win our business.

parties may seek to hold us responsible for liabilities of Harvard Bioscience that we did not assume in our agreements.

connection with the Separation, Harvard Bioscience has generally agreed to retain all liabilities that did not historically arise from

our business.

Third parties may seek to hold us responsible for Harvard Bioscience’s retained liabilities.

Under our agreements

with Harvard Bioscience, Harvard Bioscience has agreed to indemnify us for claims and losses relating to these retained liabilities.

However, if those liabilities are significant and we are ultimately liable for them, we cannot assure you that we will be able to recover

the full amount of our losses from Harvard Bioscience, which could have a material adverse effect on our business, financial

condition or results of operations.

political and other risks associated with our international operations could adversely affect our revenues and international growth prospects.

Company started selling longevity supplements through Longevity Products in the third quarter of 2023.

These products are marketed

to the general public and initially targeted at consumers in the Great China Region through eCommerce (online sales).

Longevity Products plans to include a broad

range of products focused on personal healthcare including longevity dietary supplements.

Our international operations are subject

to a number of risks inherent to operating in foreign countries, and any expansion of our international operations will amplify the

effects of these risks, which include, among others:

political and economic instability of foreign markets;

foreign governments’ restrictive trade policies or the

impact of trade tensions amongst nations;

inconsistent product regulation or sudden policy changes by

foreign agencies or governments;

the imposition of, or increase in, duties, taxes, government

royalties or non-tariff trade barriers;

difficulty in collecting international accounts receivable

and potentially longer payment cycles;

difficulty of enforcing contractual obligations of foreign

increased costs in maintaining international marketing efforts;

problems entering international markets with different cultural

bases and consumer preferences;

compliance with foreign regulatory requirements such as the

General Data Protection Regulation (GDPR), domestic laws and regulations applicable to international operations, such as the Foreign

Corrupt Practices Act and regulations promulgated by the Office of Foreign Asset Control, as well as regulatory laws, regulations and

restrictions that may impact or target dietary supplement retailers and manufacturers;

fluctuations in foreign currency exchange rates;

operating in new, developing or other markets in which there

are significant uncertainties regarding the interpretation, application and enforceability of laws and regulations relating to contract

and intellectual property rights.

of these risks could have a material adverse effect on our international operations and our growth strategy.

Additionally,

if the opportunity arises, we may expand our operations into new and high-growth international markets.

However, there is no assurance

that we will expand our operations in such markets in our desired time frame.

To expand our operations into new international markets,

we may enter into business combination transactions, make acquisitions or enter into strategic partnerships, joint ventures or alliances,

any of which may be material.

We may enter into these transactions to acquire other businesses or products to expand our products or

take advantage of new developments and potential changes in the industry.

Our lack of experience operating in new international markets

and our lack of familiarity with local economic, political and regulatory systems could prevent us from achieving the results that we

expect on our anticipated time frame or at all.

If we are unsuccessful in expanding into new or high-growth international markets, it

could adversely affect our operating results and financial condition.

Additionally,

our business is increasingly exposed to operational risks in China.

These include, among others, changes in economic conditions (including

consumer spending, unemployment levels and wage and commodity inflation), consumer preferences, the regulatory environment, and tax laws

and regulations, as well as increased media scrutiny, fluctuations in foreign exchange rates, increased restrictions or tariffs on imported

supplies as a result of trade disputes and increased competition.

Any significant or prolonged deterioration in U.S.-China relations

could adversely affect our operations in China if Chinese consumers reduce the frequency of their purchases of our products.

law regulates our business conducted within China.

In addition, if we are unable to enforce our intellectual property or contract rights

in China, it could result in an interruption in the operation of our brands, which could negatively impact our financial results.

our business is harmed or development of our Chinese operations is slowed in China due to any of these factors, it could negatively impact

our overall financial results or our growth prospects.

Relating to Our Common Stock

4 unchanged sentences

The interests of these stockholders may conflict with your interests.

This significant concentration of share ownership may adversely affect the trading price for

our common stock because investors may perceive disadvantages in owning stock in companies with controlling stockholders.

This significant concentration of share ownership may adversely affect the trading price for our common stock because investors may perceive

disadvantages in owning stock in companies with controlling stockholders.

trading market that will provide you with adequate liquidity may not develop for our common stock.

6 unchanged sentences

revenues or operating results fall below the expectations of investors or securities analysts, the price of our common stock could decline

substantially, which could have a material adverse effect on our ability to raise additional

capital, to use our stock as consideration for future acquisitions or for compensation of our employees.

In addition to the other factors discussed under these “Risk Factors,” specific factors that may cause fluctuations

in our operating results include:

substantially, which could have a material adverse effect on our ability to raise additional capital, to use our stock as consideration

for future acquisitions or for compensation of our employees.

In addition to the other factors discussed under these “Risk Factors,”

specific factors that may cause fluctuations in our operating results include:

and pricing for our products;

44 unchanged sentences

market price of our common stock may fluctuate widely, depending upon many factors, some of which may be beyond our control, including:

the success and costs of

preclinical and clinical testing and obtaining regulatory approvals or clearances for our products;

the success or failure

of surgeries and procedures involving the use our products;

a shift in our investor

our quarterly or annual

results of operations, or those of other companies in our industry;

actual or anticipated fluctuations

in our operating results due to factors related to our business;

changes in accounting standards,

policies, guidance, interpretations or principles;

announcements by us or

our competitors of significant acquisitions, dispositions or intellectual property developments or issuances;

the failure of securities

analysts to cover our common stock;

changes in earnings estimates

by securities analysts or our ability to meet those estimates;

the operating and stock

price performance of other comparable companies;

success and costs of preclinical and clinical testing and obtaining regulatory approvals or clearances for our products;

success or failure of surgeries and procedures involving the use our products;

shift in our investor base;

quarterly or annual results of operations, or those of other companies in our industry;

or anticipated fluctuations in our operating results due to factors related to our business;

in accounting standards, policies, guidance, interpretations or principles;

announcements

by us or our competitors of significant acquisitions, dispositions or intellectual property developments or issuances;

failure of securities analysts to cover our common stock;

in earnings estimates by securities analysts or our ability to meet those estimates;

operating and stock price performance of other comparable companies;

our issuance of equity, debt or other financing instruments;

overall market fluctuations;

general macroeconomic conditions.

market fluctuations;

macroeconomic conditions.

markets in general have experienced volatility that has often been unrelated to the operating performance of a particular company.

6 unchanged sentences

have in the past issued, and we may at any time in the future issue, additional shares of authorized preferred stock.

For example, in

our December 2017 private placement transaction, we authorized 12,000 shares of Series D convertible preferred stock, of which we issued

3,108 shares, all of which have been converted into shares of common stock, and in June 2022 we also issued 4,000 shares of Series

E convertible preferred stock, and additional shares of Series E convertible preferred stock thereafter

in relation to dividends on such Series E convertible preferred stock.

The Company issued an aggregate of 180

shares of Series E Convertible Preferred Stock relating to accrued dividends during the year ended December 31, 2022.

in our December 2017 private placement transaction, we authorized 12,000 shares of Series D convertible preferred stock, of which we

issued 3,108 shares, all of which have been converted into shares of common stock, and in June 2022 we also issued 4,000 shares of

Series E convertible preferred stock, and additional shares of Series E convertible preferred stock thereafter in relation to

dividends on such Series E convertible preferred stock.

The Company issued an aggregate of 180 and 77 shares of Series E convertible

preferred stock relating to accrued dividends during the years ended December 31, 2022 and 2023, respectively.

All shares of Series E convertible

preferred stock have been converted into shares of common stock as of December 31, 2023.

do not intend to pay cash dividends on our common stock.

29 unchanged sentences

perception of our business, and announcements made by us, our competitors, parties with whom we have business relationships or third

Impact of COVID-19, Supply Chain Disruptions

and Other Matters

The impact of the COVID-19 outbreak has subsided substantially in the U.S.

but continues to result in reduced activity levels outside of the U.S., such as continued restrictions on travel and business operations and advising or requiring individuals to limit or forego their time outside of their homes or places of business.

In response to the global supply chain instability and inflationary cost increases, we have taken action to minimize, as much as possible, any potential adverse impacts by working with our suppliers to monitor the availability of raw material components (e.g., polymers and organic solvents), lead times, and freight carrier availability.

We expect global supply chain instability will continue to have an impact on our business, but to date that has not been material to our financial performance or the development of our products.

The consequences of the pandemic, global supply chain instability and inflationary cost increases and their adverse impact to the global economy, continue to evolve.

Accordingly, the significance of the future impact to our business, financial condition and results of operations remains subject to significant uncertainty.

securities or industry analysts do not publish research or reports, or publish unfavorable research or reports, about us, our business

or our market, our stock price and trading volume could decline.

trading market for our common stock will be influenced by the research and reports that securities or industry analysts publish about

us and our business.

Securities or industry analysts may elect not to provide coverage of our common stock, and such lack of coverage

may adversely affect the market price of our common Stock.

In the event we do not secure additional securities or industry analyst coverage,

we will not have any control over the analysts or the content and opinions included in their reports.

The price of our stock could decline

if one or more securities or industry analysts downgrade our stock or issue other unfavorable commentary or research.

If one or more

securities or industry analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could

decrease, which in turn could cause our stock price or trading volume to decline.

of COVID-19, Supply Chain Disruptions and Other Matters

impact of the COVID-19 outbreak has subsided substantially in the U.S.

but continues to result in reduced activity levels outside of

the U.S., such as continued restrictions on travel and business operations and advising or requiring individuals to limit or forego their

time outside of their homes or places of business.

In response to the global supply chain instability and inflationary cost increases,

we have taken action to minimize, as much as possible, any potential adverse impacts by working with our suppliers to monitor the availability

of raw material components (e.g., polymers and organic solvents), lead times, and freight carrier availability.

We expect global supply

chain instability will continue to have an impact on our business, but to date that has not been material to our financial performance

or the development of our products.

The consequences of the pandemic, global supply chain instability and inflationary cost increases

and their adverse impact to the global economy, continue to evolve.

Accordingly, the significance of the future impact to our business,

financial condition and results of operations remains subject to significant uncertainty.

are subject to new U.S.

3 unchanged sentences

October 2018, the U.S.

Department of Treasury announced a pilot program to implement part of the FIRRMA, effective November 10, 2018.

Department of Treasury announced a pilot program to implement part of the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA),

effective November 10, 2018.

The pilot program expands the jurisdiction of CFIUS to include certain direct or indirect foreign investments in a defined category of

companies, which may include companies such as Biostage in the biotechnology industry.

Among other things, FIRRMA empowers CFIUS

to require certain foreign investors to make mandatory filings and permits CFIUS to charge filing fees related to such filings.

filings are subject to review by CFIUS.

Any such restrictions on the ability to purchase shares of our common stock may have the effect

of delaying or deterring any particular investment and could also affect the price that some investors are willing to pay for our common

In addition, such restrictions could also limit the opportunity for our stockholders to receive a premium for their shares of

our common stock in relation to any potential change in control.

companies, which may include companies such as Harvard Apparatus Regenerative Technology in the biotechnology industry.

things, FIRRMA empowers CFIUS to require certain foreign investors to make mandatory filings and permits CFIUS to charge filing fees

related to such filings.

Such filings are subject to review by CFIUS.

Any such restrictions on the ability to purchase shares of our

common stock may have the effect of delaying or deterring any particular investment and could also affect the price that some investors

are willing to pay for our common stock.

In addition, such restrictions could also limit the opportunity for our stockholders to receive

a premium for their shares of our common stock in relation to any potential change in control.

intend to generate significant revenues outside the U.S., including in China and the E.U.

9 unchanged sentences

policies, treaties, government regulations and tariffs.

The current United States administration has called for substantial changes to U.S.

trade policy including greater restrictions on international trade and significant increases in tariffs on goods imported into the U.S.

Under the current status, we do not expect that this tariff will significantly impact any Biostage products and thus the tariff should

not have a materially adverse effect on our business, financial condition or results of operations.

We are unable to predict whether

or when additional tariffs will be imposed or the impact of any such future tariff increases.

are exposed to a variety of risks relating to our potential international sales and operations, including fluctuations in exchange

rates, local economic conditions and delays in collection of accounts receivable.

The current United States administration has called for substantial changes to

foreign trade policy including greater restrictions on international trade and significant increases in tariffs on goods imported

into the U.S.

Under the current status, we do not expect that this tariff will significantly impact any Harvard Apparatus Regenerative

Technology products and thus the tariff should not have a materially adverse effect on our business, financial condition or results of

We are unable to predict whether or when additional tariffs will be imposed or the impact of any such future tariff increases.

are exposed to a variety of risks relating to our potential international sales and operations, including fluctuations in exchange rates,

local economic conditions and delays in collection of accounts receivable.

intend to generate significant revenues outside the U.S.

in multiple foreign currencies including Chinese Renminbi, Euros, British

pounds, and in U.S.

in multiple foreign currencies including Chinese Renminbi, Euros, British pounds,

dollar-denominated transactions conducted with customers who generate revenue in currencies other than the U.S.

In such instances, for those foreign customers who purchase our products in U.S.

dollars, currency fluctuations between the

dollar and the currencies in which those customers do business may have a negative impact on the demand for our products in

foreign countries where the U.S.

such instances, for those foreign customers who purchase our products in U.S.

dollars, currency fluctuations between the U.S.

and the currencies in which those customers do business may have a negative impact on the demand for our products in foreign countries

where the U.S.

dollar has increased in value compared to the local currency.

58 unchanged sentences

the United States, there have been and continue to be a number of legislative initiatives to contain healthcare costs.

in March 2010, the Affordable Care Act, or ACA, was passed, which substantially changes the way healthcare is financed by both

governmental and private insurers, and significantly impacts the U.S.

For example, in

March 2010, the Affordable Care Act, or ACA, was passed, which substantially changes the way healthcare is financed by both governmental

and private insurers, and significantly impacts the U.S.

pharmaceutical industry.

The ACA, among other things, subjects

biological products to potential competition by lower-cost biosimilars, addresses a new methodology by which rebates owed by

manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or

injected, increases the minimum Medicaid rebates owed by manufacturers under the Medicaid Drug Rebate Program and extends the rebate

program to individuals enrolled in Medicaid managed care organizations, establishes annual fees and taxes on manufacturers of

certain branded prescription drugs, and creates a new Medicare Part D coverage gap discount program, in which manufacturers must

agree to offer 50% (70% commencing January 1, 2019) point-of-sale discounts off negotiated prices of applicable brand drugs to

eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered

under Medicare Part D.

Some of the provisions of the ACA have yet to be fully implemented, while certain provisions have been

subject to Judicial and Congressional challenges, as well as efforts by the Trump administration to repeal or replace certain

aspects of the ACA.

Since January 2017, former President Trump signed two Executive Orders designed to delay the implementation

of certain provisions of the ACA or otherwise circumvent some of the requirements for health insurance mandated by the

The ACA, among other things, subjects biological products

to potential competition by lower-cost biosimilars, addresses a new methodology by which rebates owed by manufacturers under the Medicaid

Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, increases the minimum Medicaid

rebates owed by manufacturers under the Medicaid Drug Rebate Program and extends the rebate program to individuals enrolled in Medicaid

managed care organizations, establishes annual fees and taxes on manufacturers of certain branded prescription drugs, and creates a new

Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% (70% commencing January 1, 2019) point-of-sale

discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition

for the manufacturer’s outpatient drugs to be covered under Medicare Part D.

Some of the provisions of the ACA have yet to be fully

implemented, while certain provisions have been subject to Judicial and Congressional challenges, as well as efforts by the Trump administration

to repeal or replace certain aspects of the ACA.

Since January 2017, former President Trump signed two Executive Orders designed to delay

the implementation of certain provisions of the ACA or otherwise circumvent some of the requirements for health insurance mandated by

Concurrently,

43 unchanged sentences

between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs.

Most recently, the Inflation Reduction Act of 2022 included a number of significant drug pricing reforms, which include the establishment of a drug price negotiation program within the U.S.

Department of Health and Human Services that requires manufacturers to charge a negotiated “maximum fair price” for certain selected drugs or pay an excise tax for noncompliance, the establishment of rebate payment requirements on manufacturers under Medicare Parts B and D to penalize price increases that outpace inflation, and a redesign of the Part D benefit, as part of which manufacturers are required to provide discounts on Part D drugs.

recently, the Inflation Reduction Act of 2022 included a number of significant drug pricing reforms, which include the establishment

of a drug price negotiation program within the U.S.

Department of Health and Human Services that requires manufacturers to charge a negotiated

“maximum fair price” for certain selected drugs or pay an excise tax for noncompliance, the establishment of rebate payment

requirements on manufacturers under Medicare Parts B and D to penalize price increases that outpace inflation, and a redesign of the

Part D benefit, as part of which manufacturers are required to provide discounts on Part D drugs.

of these regulatory changes and events could limit our ability to form collaborations and our ability to commercialize our products,

11 unchanged sentences

stock less attractive to investors.

are a smaller reporting company, or SRC, and a non-accelerated filer, which allows us to take advantage of exemptions from various

reporting requirements that are applicable to other public companies that are not SRCs or non-accelerated filers, including not

being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended,

reduced disclosure obligations, including disclosures regarding executive compensation, in our Annual Report and our periodic

reports and proxy statements and providing only two years of audited financial statements in our Annual Report and our periodic

We will remain an SRC until (a) the aggregate market value of our outstanding common stock held by non-affiliates as of the

last business day our most recently completed second fiscal quarter exceeds $250 million or (b) in the event we have over $100

million in annual revenues, and the aggregate market value of our outstanding common stock held by non-affiliates as of the last

business day our most recently completed second fiscal quarter exceeds $700 million.

We cannot predict whether investors will find

our common stock less attractive if we rely on certain or all of these exemptions.

If some investors find our common stock less

attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile and

are a smaller reporting company, or SRC, and a non-accelerated filer, which allows us to take advantage of exemptions from various reporting

requirements that are applicable to other public companies that are not SRCs or non-accelerated filers, including not being required

to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended, reduced disclosure

obligations, including disclosures regarding executive compensation, in our Annual Report and our periodic reports and proxy statements

and providing only two years of audited financial statements in our Annual Report and our periodic reports.

We will remain an SRC until

(a) the aggregate market value of our outstanding common stock held by non-affiliates as of the last business day our most recently completed

second fiscal quarter exceeds $250 million or (b) in the event we have over $100 million in annual revenues, and the aggregate market

value of our outstanding common stock held by non-affiliates as of the last business day our most recently completed second fiscal quarter

exceeds $700 million.

We cannot predict whether investors will find our common stock less attractive if we rely on certain or all of

these exemptions.

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

our common stock and our stock price may be more volatile and may decline.

incur increased costs as a result of operating as a public company, and our management is required to devote substantial time to new

1 unchanged sentence

a public company, we incur significant legal, accounting, and other expenses that we did not incur as a private company.

generally increase for a company whose shares are listed on the NYSE American or Nasdaq Capital Market as compared to the costs for

a company for whose shares are quoted on the OTCQB Venture Market.

The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and

Consumer Protection Act, FINRA rules and other applicable securities rules and regulations impose various requirements on public

companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance

Our management and other personnel need to devote a substantial amount of time to these compliance initiatives.

these rules and regulations increase our legal and financial compliance costs and make some activities more time-consuming and

generally increase for a company whose shares are listed on the NYSE American or Nasdaq Capital Market as compared to the costs for a

company for whose shares are quoted on the OTCQB Venture Market.

The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer

Protection Act, FINRA rules and other applicable securities rules and regulations impose various requirements on public companies, including

establishment and maintenance of effective disclosure and financial controls and corporate governance practices.

Our management and other

personnel need to devote a substantial amount of time to these compliance initiatives.

Moreover, these rules and regulations increase

our legal and financial compliance costs and make some activities more time-consuming and costly.

continue to evaluate these rules and regulations and cannot predict or estimate the amount of additional costs we may incur or the timing

6 unchanged sentences

Insurance Corporation (“FDIC”), the loss of which would have a severe negative affect on our operations and liquidity.

currently have the majority of our cash and cash equivalents held in deposit at Bank of America.

While the amounts held in the

deposit accounts as of March 20, 2023 were less than the insurance coverage offered by the FDIC, in the future, we will likely

maintain our cash assets at financial institutions in the U.S.

currently have the majority of our cash and cash equivalents held in deposit at East West Bank.

While the amounts held in the deposit

accounts as of December 31, 2023 were less than the insurance coverage offered by the FDIC, in the future, we will likely maintain our cash

assets at financial institutions in the U.S.

in amounts that may be in excess of the FDIC insurance limit of $250,000.

Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial

institutions, transactional counterparties or other companies in the financial services industry or the financial services industry

generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead

to market-wide liquidity problems.

For example, on March 10, 2023, Silicon Valley Bank, or SVB, was closed by the California

Department of Financial Protection and Innovation, which appointed the FDIC as receiver.

In the event of a failure or liquidity

issue of or at any of these financial institutions where we maintain our deposits or other assets, we may incur a loss, and to the

extent such loss exceeds the FDIC insurance limitation it could have a material adverse effect upon our liquidity, financial

condition and our results of operations.

Unresolved Staff Comments.

Actual events

involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional

counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors

about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems.

For example, on March 10, 2023, Silicon Valley Bank, or SVB, was closed by the California Department of Financial Protection and Innovation,

which appointed the FDIC as receiver.

In the event of a failure or liquidity issue of or at any of these financial institutions where

we maintain our deposits or other assets, we may incur a loss, and to the extent such loss exceeds the FDIC insurance limitation it could

have a material adverse effect upon our liquidity, financial condition and our results of operations.

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