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Item 1A. Risk Factors

2026-03-20 compared with 2025-03-13 · 282 added, 306 removed, 929 unchanged (39% of the section changed)

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Risks Related to Our Financial Position and Capital Needs

We have incurred significant operating losses since inception and anticipate that we will continue to incur substantial operating losses for the foreseeable future and may never achieve or maintain profitability.

We have incurred significant operating losses since inception and anticipate that we will continue to incur substantial operating losses for the foreseeable future until revenue from CARDAMYST is sufficient to fund our operations, if ever, and may never achieve or maintain profitability.

Since inception in 2003, we have incurred significant operating losses.

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continue our ongoing and planned development of etripamil, including future Phase 3 clinical trials for the treatment of AFib-RVR and potential Phase 4 clinical trials for treatment of PSVT;

seek marketing approvals for etripamil for the treatment of PSVT, AFib-RVR and other cardiovascular indications;

establish a sales, marketing, manufacturing and distribution capability, either directly or indirectly with third parties, to commercialize etripamil or any future product candidate for which we may obtain marketing approval;

seek, either directly or through collaboration with our partners, marketing approval for etripamil nasal spray for the treatment of PSVT from regulatory agencies responsible for regions outside the United States;

seek marketing approvals for etripamil for the treatment of AFib-RVR and other cardiovascular indications;

increase our sales, marketing, manufacturing and distribution capabilities, either directly or indirectly with third parties;

build a portfolio of product candidates through development, or the acquisition or in-license of drugs, product candidates or technologies;

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hire additional clinical, regulatory and scientific personnel;

add operational, financial and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts;

add operational, financial and management information systems and personnel, including personnel to support our product development and potential expansion of our future commercialization efforts;

incur additional legal, insurance related, accounting and other expenses associated with operating as a public company.

To become and remain profitable, we must succeed in developing and eventually commercializing drugs that generate significant revenue.

This will require us to be successful in a range of challenging activities, including completing clinical trials of etripamil and any future product candidates that way may pursue, obtaining regulatory approval, procuring commercial-scale manufacturing, marketing and selling etripamil and any future products for which we may obtain regulatory approval, as well as discovering or acquiring and then developing additional product candidates.

To become and remain profitable, we must succeed in commercializing CARDAMYST for the treatment of PSVT and developing and eventually commercializing product candidates that generate significant revenue.

This will require us to be successful in a range of challenging activities, including commercialization of CARDAMYST for the treatment of PSVT, completing any further clinical trials of etripamil and any future product candidates that way may pursue, obtaining regulatory approval, and manufacturing, marketing and selling etripamil and any future products for which we may obtain regulatory approval, as well as discovering or acquiring and then developing additional product candidates.

We are only in the preliminary stages of some of these activities.

We may never succeed in these activities and, even if we do, may never generate revenues that are significant enough to achieve profitability.-scale manufacturing, marketing and selling etripamil and any future products for which we may obtain regulatory approval, as well as discovering or acquiring and then developing additional product candidates.

We are only in the preliminary stages of some of these activities.

We may never succeed in these activities and, even if we do, may never generate revenues that are significant enough to achieve profitability.

Our revenue will be dependent, in part, upon the size of the markets in the territories for which we have gained or may gain regulatory approval, the accepted price for the product, the ability to obtain coverage and reimbursement, and whether we own the commercial rights for that territory.

If the number of our addressable patients is not as significant as we estimate, the indication approved by regulatory authorities is narrower than we expect, or the treatment population is narrowed by competition, physician choice or treatment guidelines, we may not generate significant revenue from sales of such products.

Because of the numerous risks and uncertainties associated with drug development, we are unable to accurately predict the timing or amount of expenses or when, or if, we will be able to achieve profitability.

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A decline in the value of our common shares could also cause you to lose all or part of your investment.

Our limited operating history may make it difficult for you to evaluate the success of our business to date and to assess our future viability.

We are a clinical-stage company founded in 2003, and our operations to date have been largely focused on raising capital, organizing, staffing our Company and undertaking preclinical studies and conducting clinical trials for etripamil.

As an organization, we have not yet demonstrated an ability to successfully complete clinical development, obtain regulatory approvals, manufacture a commercial-scale product or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful commercialization.

Our limited operating history and limited history of commercializing products may make it difficult for you to evaluate the success of our business to date and to assess our future viability.

We are a commercial pharmaceutical company founded in 2003, and our operations to date have been largely focused on raising capital, organizing, staffing our Company and undertaking preclinical studies and conducting clinical trials for etripamil.

As an organization, we have not yet demonstrated the ability to conduct sales and marketing activities necessary for successful commercialization.

Consequently, any predictions about our future success or viability may not be as accurate as they could be if we had a longer operating history or a history of scaling product or arranging for a third party to do so on our behalf, or conducting sales and marketing activities necessary for successful commercialization.

Consequently, any predictions about our future success or viability may not be as accurate as they could be if we had a longer operating history or a history of successful clinical development and commercialization of products.

We may encounter unforeseen expenses, difficulties, complications, delays and other known or unknown factors in achieving our business objectives.

We will need to transition at some point from a company with a research and development focus to a company capable of supporting commercial activities.

We are currently transitioning from a company with a research and development focus to a company primarily focused on commercial activities.

We may not be successful in such a transition.

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We will require substantial additional funding to finance our operations.

If we are unable to raise capital when needed, we could be forced to delay, reduce or terminate our development of etripamil or other operations.

Based on our research and development plans, we expect that our existing cash and cash equivalents and short-term investments will be sufficient to fund our operations for at least the next 12 months from the date of issuance of this 10-K for the year ended December 31, 2024 and that there are no events or conditions that may cast substantial doubt on our ability to continue as a going concern for at least the next 12 months from the date of this filing.

However, we will need

to obtain substantial additional funding in connection with our continuing operations and planned activities.

If we are unable to raise capital when needed, we could be forced to delay, reduce or terminate our development of etripamil or other operations, including the continued commercialization of CARDAMYST.

Based on our commercialization and research and development plans, we expect that our existing cash and cash equivalents and short-term investments will be sufficient to fund our operations for at least the next 12 months from the date of issuance of this 10-K for the year ended December 31, 2025 and that there are no events or conditions that we are aware of that cast substantial doubt on our ability to continue as a going concern for at least the next 12 months from the date of this filing.

However, we will need to obtain substantial additional funding in connection with our continuing operations and planned activities, including the continued commercialization of CARDAMYST.

Our future capital requirements will depend on many factors, including:

the timing, progress of NDA review and results of our ongoing and planned clinical trials of etripamil in PSVT, AFib-RVR and in other indications;

the timing, progress of and results of our ongoing and planned clinical trials of etripamil in AFib-RVR and in other indications;

the success of our commercialization efforts;

the scope, progress, results and costs of preclinical development, laboratory testing and clinical trials of etripamil for additional indications or any future product candidates that we may pursue;

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the ability of vendors who we rely on to accurately forecast expenses and deliver on expectations;

the costs, timing and outcome of regulatory review of etripamil and any future product candidates;

the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distribution, for etripamil and any future product candidates for which we receive marketing approval;

the revenue, if any, received from commercial sales of etripamil and any future product candidates for which we receive marketing approval;

the costs, timing and outcome of regulatory review of etripamil in subsequent indications and any future product candidates;

the costs and timing of commercialization activities, including product manufacturing, marketing, sales and distribution, for etripamil and any future product candidates for which we receive marketing approval;

the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims;

the extent to which we acquire or in-license other product candidates and technologies;

and license other product candidates and technologies;

the costs of operating as a public company.

Identifying potential product candidates and conducting preclinical testing and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete, and we may never generate the necessary data or results required to obtain regulatory approval and achieve product sales.

Identifying potential product candidates and conducting preclinical testing and clinical trials is a time-consuming, expensive, and uncertain process that takes years to complete, and we may never generate the necessary data or results required to obtain regulatory approval of additional product candidates and achieve product sales related thereto.

For example, our NODE-301 trial of etripamil for PSVT did not meet its primary endpoint.

In addition, etripamil and any future product candidates, if approved, may not achieve commercial success.

Our commercial revenues, if any, will be derived from sales of drugs that are not yet approved anywhere in the world and carry the risk of not being commercially available for several years, if at all.

In addition, CARDAMYST, additional indications of etripamil and any future product candidates may not achieve commercial success.

In the near term, our commercial revenues will be derived from sales of CARDAMYST, which may not be sufficient to fund our operations.

Accordingly, we will need to continue to rely on additional financing to achieve our business objectives.

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If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce, or altogether terminate our research and development programs or future commercialization efforts.

Economic uncertainty may adversely affect our results of operations.

Our results of operations may be materially affected by global economic conditions, including inflation, which has recently increased at the fastest pace in nearly 40 years, sustained uncertainty regarding future economic conditions, prolonged tightening of credit markets and changes in tax rates.

In recent years, the U.S.

and other significant economic markets have experienced cyclical downturns, and worldwide economic conditions remain uncertain.

Increased inflation may result in increased operating costs.

In addition, the U.S.

Federal Reserve has raised interest rates in response to

concerns about inflation.

While such uncertainty persists, investor concerns over inflation, market volatility, new or changing international tariffs, geopolitical tensions (such as the war between Russia and Ukraine or the Israel-Hamas war) and public health crises (such as the COVID-19 pandemic), as well as potential future conditions, which may be impacted by the implementation of tariffs by the United States and other countries, may cause deteriorating market conditions with adverse effects on our business, financial condition and operating results.

See also “─Unstable market and economic conditions, including as a result of recent bank closures, public health crises or geopolitical tensions such as the Russia-Ukraine and/or the Israel-Hamas war, may have serious adverse consequences on our business, financial condition and share price.”

Greater than expected returns of CARDAMYST may exceed our reserve for returns, which would adversely affect our revenue and operating results.

The pharmaceutical wholesalers and distributors to which we sell CARDAMYST are permitted to return purchased product under certain circumstances.

We estimate expected returns based on our review of similar products in the industry and record discrete reserves if products held by distributors, forecasted sales and expiration of product warrant a reserve.

Any significant increase in returns that exceeds our reserve could adversely affect our revenue and operating results.

Unfavorable global economic conditions could adversely affect our business, financial condition or results of operations .

Our results of operations could be adversely affected by general conditions in the global economy.

Unfavorable conditions in the economy both in the United States and abroad, including conditions resulting from changes in gross domestic product growth in the United States or abroad, financial and credit market fluctuations, inflation, fluctuating interest rates, international tariff policies, trade wars and other concerns regarding international trade relations, political turmoil, natural catastrophes, outbreaks of contagious diseases, geopolitical tensions, warfare and terrorist attacks, could cause a decrease in business investments, disrupt the timing and cadence of key industry events, and negatively affect the growth of our business and our results of operations.

For example, the COVID-19 pandemic adversely affected workforces, economies and financial markets globally, leading to a reduction in the ability of, or the inability of, partners, suppliers, vendors or other parties to meet their contractual obligations, and for a period of time, a reduction in customer spending on technology, and such conditions may reoccur in the future.

Geopolitical conflict, including wars, and the related political and economic responses thereto, such as sanctions, may also exacerbate these issues.

A severe or prolonged economic downturn could result in a variety of risks to our business, including weakened demand for CARDAMYST, our product candidates and our ability to raise additional capital when needed on acceptable terms, if at all.

A weak or declining economy could also strain our suppliers, possibly resulting in supply disruption, or cause delays in payments for our services by third-party payors or our collaborators.

Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate and financial market conditions could adversely impact our business, financial condition, results of operations and prospects.

Raising additional capital may cause dilution to our shareholders, restrict our operations or require us to relinquish rights to our product candidates.

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We do not have any committed external source of funds.

To the extent that we raise additional capital through the sale of equity or convertible debt securities, such as the 2029 Convertible Notes (as defined herein), your ownership interest may be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a shareholder.

and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a shareholder.

Debt and equity financings, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as redeeming our shares, making investments, incurring additional debt, making capital expenditures, declaring dividends or placing limitations on our ability to acquire, sell or license intellectual property rights.

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If we are unable to raise additional capital when needed, we may be required to delay, limit, reduce or terminate our drug development or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise develop and market ourselves.

Our ability to use our non-capital loss carryforwards to offset future taxable income may be subject to certain limitations.

Our ability to use our non-capital loss carry-forwards to offset future taxable income may be subject to certain limitations.

In general, where control of a corporation has been acquired by a person or group of persons, subsection 111(5) of the Income Tax Act (Canada), or the “Canadian Tax Act,” and equivalent provincial income tax legislation restrict the corporation’s ability to carry forward non-capital losses from preceding taxation years.

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As of December 31, 2025, we had U.S.

federal net operating loss carryforwards, or “NOLs,” of $67.0 million as a result of expenses incurred by Milestone Pharmaceuticals USA, Inc., our wholly owned subsidiary.

federal net operating loss carry-forwards, or “NOLs,” of $103.2 million as a result of expenses incurred by Milestone Pharmaceuticals USA, Inc., our wholly owned subsidiary.

Under current U.S.

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Risks Related to the Development of Our Product Candidates

We have only one product candidate, etripamil, for which we are currently pursuing clinical development and regulatory approval.

Our future success is substantially dependent on the successful clinical development and regulatory approval of etripamil.

If we are not able to obtain required regulatory approvals for etripamil or any future product candidates, we will not be able to commercialize etripamil or any future product candidates and our ability to generate revenue will be adversely affected.

Etripamil is currently our only product candidate.

We have not obtained regulatory approval for etripamil or any product candidate, and it is possible that neither etripamil nor any product candidates we may seek to develop in the future will ever obtain regulatory approval.

We currently have one approved product, CARDAMYST™ (etripamil) nasal spray, a prescription medication for the conversion of acute symptomatic episodes of PSVT.

We are currently pursuing clinical development for subsequent etripamil indications.

If we are not able to obtain required regulatory approvals for subsequent etripamil indications or any future product candidates, our ability to generate revenue will be adversely affected.

Etripamil is currently our only product.

We have not obtained regulatory approval for additional indications of etripamil or any other product candidate, and it is possible that neither new indications of etripamil nor any product candidates we may seek to develop in the future will ever obtain regulatory approval.

Neither we nor any future collaborator is permitted to market any drug product candidates in the United States or other countries until we receive regulatory approval from the FDA or applicable foreign regulatory agency.

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In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change during the course of a product candidate’s clinical development and may vary among jurisdictions.

Prior to obtaining approval to commercialize etripamil and any other drug product candidate in the United States or elsewhere, we must demonstrate with substantial evidence from well controlled clinical trials, and to the satisfaction of the FDA or comparable foreign regulatory authorities, that such product candidates are safe and effective for their intended uses.

Prior to obtaining approval to commercialize etripamil for additional indications and any other drug product candidate in the United States or elsewhere, we must demonstrate with substantial evidence from well controlled clinical trials, and to the satisfaction of the FDA or comparable foreign regulatory authorities, that such product candidates are safe and effective for their intended uses.

Results from nonclinical studies and clinical trials can be interpreted in different ways.

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The FDA may also require us to conduct additional nonclinical studies, including human factor studies, or clinical trials for our product candidates either prior to or post-approval, or it may object to elements of our clinical development program.

For example, the approval of CARDAMYST is subject to a postmarketing requirement to conduct a safety, pharmacokinetics and pharmacodynamics trial in pediatric patients with PSVT.

Of the large number of products in development, only a small percentage successfully complete the FDA or comparable foreign regulatory authorities’ approval processes and are commercialized.

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We have invested a significant portion of our time and financial resources in the development of etripamil.

Our business is dependent on our ability to successfully complete development of, obtain regulatory approval for, and, if approved, successfully commercialize etripamil and any future product candidates in a timely manner.

In May 2024, we announced that the FDA accepted our NDA.

The NDA for etripamil was resubmitted based on guidance from the FDA after receipt of a Refusal to File, “RTF,” letter from the FDA in December 2023 in connection with the original NDA submission in October 2023.

In the RTF letter and upon preliminary review, the FDA determined that the NDA was not sufficiently complete to permit substantive review.

The FDA requested clarification about the data recorded for the time of adverse events in Phase 3 clinical trials;

FDA did not express concerns about the nature or severity of adverse events.

In February 2024, Milestone held a Type A Meeting with the FDA to determine the next steps for the resubmission of the NDA.

The Agency indicated that the adverse events, or “AEs,” hourly timing data in question had minimal impact on the overall characterization of the etripamil safety profile.

As a result, data sets that capture timing of AEs reported in the Phase 3 pivotal studies were revised to align with FDA requests and resubmitted as supplementary information to the original NDA.

The resubmission package included restructured data sets that captured timing of reported AEs and certain data files reformatted to facilitate FDA’s analyses.

No additional efficacy or safety data were requested as part of the RTF.

Although the FDA indicated that the AE hourly timing data in question had minimal impact on the overall characterization of the etripamil safety profile, our revisions of the database to align with FDA requests may not be satisfactory and we cannot provide any assurance that our NDA will be approved by the FDA.

Even if we eventually complete clinical testing and receive approval of an NDA, or foreign marketing application for etripamil and any future product candidates, the FDA or the comparable foreign regulatory authorities may grant approval or other marketing authorization contingent on the performance of costly additional clinical trials, including post-market clinical trials.

Our business would be enhanced if we are able to successfully develop etripamil and obtain regulatory approval for subsequent indications and other potential product candidates.

Even if we eventually complete clinical testing and receive approval of an NDA, or foreign marketing application for additional indications of etripamil and any future product candidates, the FDA or the comparable foreign regulatory authorities may grant approval or other marketing authorization contingent on the performance of costly additional clinical trials, including post-market clinical trials.

The FDA or the comparable foreign regulatory authorities also may approve or authorize for marketing a product candidate for a more limited indication or patient population that we originally request, and the FDA or comparable foreign regulatory authorities may not approve or authorize the labeling that we believe is necessary or desirable for the successful commercialization of a product candidate.

Any delay in obtaining, or inability to obtain, applicable regulatory approval or other marketing authorization would delay or prevent commercialization of that product candidate and would materially adversely impact our business and prospects.

In addition, the FDA and comparable foreign regulatory authorities may change their policies, adopt additional regulations or revise existing regulations or take other actions, which may prevent or delay approval of our future products under development on a timely basis.

Although we have received approval of CARDAMYST in the United States, the FDA may change their policies, adopt additional regulations or revise existing regulations or take other actions, which may prevent or delay approval of our future products under development on a timely basis.

Such policy or regulatory changes could impose additional requirements upon us that could delay our ability to obtain approvals, increase the costs of compliance, or restrict our ability to maintain any marketing authorizations we may have obtained.

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We intend to build a pipeline of product candidates beyond etripamil for PSVT and progress these product candidates through clinical development.

For example, on November 11, 2023, we announced positive Phase 2 clinical trial data on etripamil for the treatment of AFib-RVR and we intend to conduct Phase 3 development for this indication for which we anticipate enrolling patients in the first half of 2025.

For example, on November 11, 2023, we announced positive Phase 2 clinical trial data on etripamil for the treatment of AFib-RVR and we intend to conduct Phase 3 development.

We may not be able to successfully expand the scope of cardiovascular indications for etripamil beyond PSVT, or leverage our expertise and experience with etripamil in PSVT to other product candidates.

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Success in preclinical testing and earlier clinical trials does not ensure that later clinical trials will generate the same results or otherwise provide adequate data to demonstrate the efficacy and safety of a product candidate.

Preclinical tests and Phase 1 and Phase 2 clinical trials are primarily designed to test safety, to study pharmacokinetics and pharmacodynamics and to understand the side effects of product candidates at various doses and schedules.

Preclinical tests and Phase 1 and Phase 2 clinical trials are primarily designed to test safety, to study pharmacokinetics and pharmacodynamics

and to understand the side effects of product candidates at various doses and schedules.

Success in preclinical studies and earlier clinical trials does not ensure that later efficacy trials will be successful, nor does it predict final results.

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While our RAPID Phase 3 trial did meet its primary endpoint, our NODE-301 clinical trial did not meet its primary endpoint.

Etripamil and any future product candidates may fail to show the desired safety and efficacy in clinical development despite positive results in preclinical studies or having successfully advanced through earlier clinical trials.

Additional indications of etripamil and any future product candidates may fail to show the desired safety and efficacy in clinical development despite positive results in preclinical studies or having successfully advanced through earlier clinical trials.

In addition, the design of a clinical trial can determine whether its results will support approval of a product, and flaws in the design of a clinical trial may not become apparent until the clinical trial is well advanced.

Clinical trial design flaws

are more likely in therapy areas, such as PSVT, where there are limited previous trials from which to learn and model clinical trials.

As an organization, we have limited experience designing clinical trials and may be unable to design and execute a clinical trial to support regulatory approval.

Clinical trial design flaws are more likely in therapy areas, such as PSVT, where there are limited previous trials from which to learn and model clinical trials.

As an organization, we have limited experience designing clinical trials for future indications of etripamil or other product candidates and may be unable to design and execute a clinical trial to support regulatory approval.

Many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in late-stage clinical trials even after achieving promising results in preclinical testing and earlier clinical trials.

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We may encounter substantial delays or difficulties in our clinical trials.

We may not commercialize, market, promote or sell any product candidate without obtaining marketing approval from the FDA or comparable foreign regulatory authorities, and we may never receive such approvals.

It is impossible to predict when or if any of our product candidates will prove effective or safe in humans and will receive regulatory approval.

It is impossible to predict when or if any of our future product candidates will prove effective or safe in humans and will receive regulatory approval.

Before obtaining marketing approval from regulatory authorities for the sale of our product candidates, we must complete preclinical development and then conduct extensive clinical trials to demonstrate the safety and efficacy of our product candidates in humans.

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delays in reaching agreement on acceptable terms with prospective clinical research organizations, or “CROs,” and clinical trial sites;

the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate, patients may drop out of these clinical trials at a higher rate than we anticipate or fail to return for post-treatment follow up or we may fail to recruit suitable patients to participate in a trial;

trials at a higher rate than we anticipate or fail to return for post-treatment follow up or we may fail to recruit suitable patients to participate in a trial;

clinical trials of our product candidates may produce negative or inconclusive results;

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changes in regulatory requirements and guidance that require amending or submitting new clinical protocols;

interruptions resulting from public health emergencies, or other geopolitical tensions, such as Russia’s incursion into Ukraine or the Israel-Hamas war;

interruptions resulting from public health emergencies, or other geopolitical tensions;

• interruptions to government agencies, such as the FDA, including as a result of levels of government funding, the ability to fill key leadership roles;

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Our product candidates will require clinical testing before we are prepared to submit an NDA, or comparable application to foreign regulatory authorities, for regulatory approval.

We cannot predict with any certainty if or when we might submit

an application for regulatory approval for any of our product candidates or whether any such application will be approved by the FDA or foreign regulatory authority.

We cannot predict with any certainty if or when we might submit an application for regulatory approval for any of our product candidates or whether any such application will be approved by the FDA or foreign regulatory authority.

Human clinical trials are very expensive and difficult to design and implement, in part because they are subject to rigorous regulatory requirements.

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Patient enrollment and retention in clinical trials depends on many factors, including the size of the patient population, the nature of the trial protocol, the existing body of safety and efficacy data, the number and nature of competing treatments and ongoing clinical trials of competing therapies for the same indication, the proximity of patients to clinical sites, the experience and capabilities of the clinical sites to recruit the correct patients, and the eligibility criteria for the trial.

In our Phase 3 clinical trials, we are attempting to enroll elderly patients and patients taking concomitant medications that impact the heart, such as other calcium channel blockers and beta blockers.

We are doing this in order to obtain efficacy and safety data on patients representing the subset of our intended population that is most vulnerable to safety concerns with the use of etripamil.

Such patients may be difficult to enroll in this trial, and the lack of data on these patients may negatively impact the approvability or labeling of etripamil.

Patient enrollment may also be affected by public health crises, such as patients experiencing difficulty accessing clinical trial sites and complying with clinical trial protocols.

In our Phase 2 clinical trial of etripamil for the treatment of PSVT, only 104 of 199 enrolled patients completed the trials, with 70 patients unable to induce or sustain episodes of SVT during the trial period.

The first Phase 3 trial of PSVT for etripamil enrolled over 400 diagnosed patients with PSVT meeting inclusion and exclusion criteria in order to achieve the required treatment of 150 confirmed PSVT episodes.

PSVT is episodic and unpredictable, and all of our Phase 3 trial designs depended on patients experiencing and recognizing an episode of SVT, self-administering etripamil and monitoring their cardiac activity using a monitoring device.

We cannot control the timing of these episodes or guarantee that patients will correctly recognize the episode, self-administer etripamil and use the cardiac monitor as directed.

There is limited, if any, meaningful precedent from which to inform our trial design and make assumptions about patient enrollment and compliance.

Accordingly, our Phase 3 trial design is subject to significantly more risks than if there were numerous studies upon which we could model our protocols.

Furthermore, our efforts to build relationships with patient communities may not succeed, which could result in delays in patient enrollment in our clinical trials.

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Differences between preliminary or interim data and final data could significantly harm our business prospects and may cause the trading price of our common shares to fluctuate significantly.

As an organization, we have completed pivotal clinical trials, but we have never submitted a successful NDA.

We may be unable to do so for any product candidates we may develop.

After completing pivotal clinical trials, we will need to obtain the approval of the FDA and other regulatory agencies to market etripamil or any of our other product candidates.

Carrying out later-stage clinical trials and the submission of a successful NDA is a complicated process.

As an organization, we have completed two Phase 3 clinical trials, we have other trials ongoing, and we have limited experience in preparing, submitting and prosecuting regulatory filings.

We may require more time and incur greater costs than our competitors and may not succeed in obtaining regulatory approvals of product candidates that we develop.

Failure to commence or complete, or delays in, our planned clinical trials could prevent us from or delay us in commercializing etripamil for the treatment of PSVT or AFIB-RVR.

The FDA may issue a complete response letter rather than approval of etripamil for PSVT for commercial marketing.

We may require more time and incur greater costs than our competitors and may not succeed in obtaining regulatory approvals of product candidates that we develop.

Failure to commence or complete, or delays in, our planned clinical trials could prevent us from or delay us in commercializing etripamil for the treatment of PSVT or AFIB-RVR.

We may explore additional strategic collaborations that may never materialize, or we may be required to relinquish important rights to and control over the development of our product candidates to any future collaborators.

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strategic collaborators could terminate the arrangement or allow it to expire, which would delay the development and may increase the cost of developing our product candidates.

Risks Related to the Commercialization of Our Product Candidates

If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell etripamil or any future product candidates, we may not be successful in commercializing etripamil or any future product candidates, if and when they are approved.

To successfully commercialize etripamil or any future product candidate that may result from our development programs, we will need to build out our sales and marketing capabilities, either on our own or with others.

The establishment and development of our own commercial team or the establishment of a contract field force to market any product candidate we may develop will be expensive and time-consuming and could delay any drug launch.

Moreover, we cannot be certain that we will be able to successfully develop this capability.

We may seek to enter into collaborations with other entities to use their established marketing and distribution capabilities, but we may be unable to enter into such agreements on favorable terms, if at all.

If any current or future collaborators do not commit sufficient resources to commercialize our product candidates, or we are unable to develop the necessary capabilities on our own, we may be unable to generate sufficient revenue to sustain our business.

We may compete with many companies that currently have extensive, experienced, and well-funded marketing and sales operations to recruit, hire, train and retain marketing and sales personnel.

We will likely also face competition if we seek third parties to assist us with the sales and marketing efforts of etripamil and any future product candidates.

Without an internal team or the support of a third party to perform marketing and sales functions, we may be unable to compete successfully against these more established companies.

In addition, if we enter into a strategic collaboration with a third party for the commercialization of etripamil or any future product candidate, we will not be able to control the amount of time or resources that they devote to such efforts.

If any strategic collaborator does not commit adequate resources to the marketing and distribution of etripamil or any future product candidate, it could limit our potential revenues.

Even if etripamil or any future product candidates receive marketing approval, they may fail to achieve market acceptance by physicians, patients, third-party payors or others in the medical community necessary for commercial success.

Even if etripamil or any future product candidates receive marketing approval, they may fail to gain market acceptance by physicians, patients, third-party payors and others in the medical community.

If such product candidates do not achieve an adequate level of acceptance, we may not generate significant drug revenue and may not become profitable.

The degree of market acceptance of etripamil or any future product candidates, if approved for commercial sale, will depend on a number of factors, including but not limited to:

Risks Related to the Commercialization of Our Product and Product Candidates

If we are unable to successfully implement and maintain sales, marketing and distribution capabilities for CARDAMYST for the treatment of PSVT or any product candidate that may receive regulatory approval, we may not be successful in commercializing CARDAMYST for the treatment of PSVT or our product candidates if and when they are approved .

We are in the early stages of commercializing CARDAMYST for the treatment of PSVT.

To achieve commercial success for CARDAMYST for the treatment of PSVT, any additional indications for etripamil and any other product candidate for which we may obtain marketing approval, we will need to continue to implement and maintain an effective sales and marketing organization.

We have built a focused sales and marketing organization to launch CARDAMYST for the treatment of PSVT in the United States.

However, we may choose to expand upon our sales force in the future for PSVT, additional etripamil indications, or other product candidates.

There are inherent risks to implementing and maintaining a standalone commercial organization, which is also time-consuming and requires significant financial resources.

Factors that create risk and may inhibit our efforts to commercialize our products on our own include:

• our inability to recruit, train and retain adequate numbers of effective sales and marketing personnel;

• the inability of sales personnel to obtain access to physicians or educate adequate numbers of physicians on the benefits of prescribing any future products;

• inability to obtain favorable insurance coverage of any approved product;

• the lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage relative to companies with more extensive product lines;

• unforeseen costs and expenses associated with creating an independent sales and marketing organization.

If we are unable to successfully implement and maintain our own sales, marketing and distribution capabilities and are forced to enter into arrangements with, and rely on, third parties to perform these services, our revenue and our profitability, if any, are likely to be lower than if we had developed such capabilities ourselves.

In addition, we may not be successful in entering into arrangements with third parties to sell, market and distribute our product candidates or may be unable to do so on terms that are favorable to us.

We likely will have little control over such third parties, and any of them may fail to devote the necessary resources and attention to sell and market our products effectively.

If we do not maintain sales, marketing and distribution capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing our product candidates

CARDAMYST, along with any subsequent etripamil indications or any other product candidates, if approved, may fail to achieve market acceptance by physicians, patients, third-party payors or others in the medical community necessary for commercial success

CARDAMYST, any subsequent etripamil indications and any other product candidates that receive marketing approval may fail to gain market acceptance by physicians, patients, third-party payors and others in the medical community.

If such CARDAMYST, any subsequent etripamil indications or any future product candidates do not achieve an adequate level of acceptance, we may not generate significant drug revenue and may not become profitable.

The degree of market acceptance of CARDAMYST, any subsequent etripamil indications or any future product candidates, if approved for commercial sale, will depend on a number of factors, including but not limited to third-party payors and others in the medical community.

the convenience and ease of administration compared to alternative treatments and therapies;

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and the awareness and support from key opinion leaders in cardiology.

Our efforts to educate physicians, patients, third-party payors and others in the medical community on the benefits of etripamil or any future product candidates may require significant resources and may never be successful.

Such efforts may require more resources than are typically required due to the potential of etripamil to shift the treatment paradigm away from acute-care settings to self-administration.

Because we expect sales of etripamil or any future product candidates, if approved, to generate substantially all of our revenues for the foreseeable future, the failure of these product candidates to find market acceptance would harm our business.

Even if we successfully obtain approval for etripamil, its success will be dependent on its proper use.

Our efforts to educate physicians, patients, third-party payors and others in the medical community on the benefits of CARDAMYST, any subsequent etripamil indications or any future product candidates may require significant resources and may never be successful.

Because we expect sales of CARDAMYST, any subsequent etripamil indications or any future product candidates, if approved, to generate substantially all of our revenues for the foreseeable future, the failure of these product candidates to find market acceptance would harm our business.

The success of etripamil for the treatment of PSVT will be dependent on its proper use.

While we have designed etripamil to be self-administered, we cannot control the successful use of the product.

While we have conducted, and intend in the future to conduct, human factors studies to determine how to optimize the instructions for use, the results in our clinical trials may not be replicated by users in the future.

If we are not successful in promoting the proper use of etripamil, if approved, we may not be able to achieve market acceptance or effectively commercialize the drug.

If we are not successful in promoting the proper use of etripamil, we may not be able to achieve market acceptance or effectively commercialize the drug.

In addition, even in the event of proper use of etripamil, individual devices may fail.

Increasing the scale of production inherently creates increased risk of manufacturing errors, and we may not be able to adequately inspect every device that is produced, and it is possible that individual devices may fail to perform as designed.

Manufacturing errors could negatively impact market acceptance of any of our product candidates that receive approval, result in negative press coverage, or increase our liability.

If the market opportunities for etripamil and any future product candidates are smaller than we estimate, our business may suffer.

Our eligible patient population may differ significantly from the actual market addressable by our product candidates.

If the market opportunities for CARDAMYST, any subsequent indications for etripamil and any future product candidates are smaller than we estimate, our business may suffer.

Our eligible patient population may differ significantly from the actual market addressable by our products and product candidates.

Our projections of both the number of people who have these conditions, as well as the subset of people with these diseases who have the potential to benefit from treatment with our product candidates, are based on our beliefs and estimates.

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More established companies may have a competitive advantage over us due to their greater size, resources, and institutional experience.

In particular, these companies have greater experience and expertise in securing reimbursement, government contracts and relationships with key opinion leaders, conducting testing and clinical trials, obtaining and maintaining regulatory approvals and distribution relationships to market products and marketing approved drugs.

These companies

also have significantly greater research and marketing capabilities than we do.

In particular, these companies have greater experience and expertise in securing reimbursement, negotiating government contracts, establishing relationships with key opinion leaders, conducting testing and clinical trials, obtaining and maintaining regulatory approvals, and distribution relationships.

These companies also have significantly greater research and marketing capabilities than we do.

If we are not able to compete effectively against existing and potential competitors, our business and financial condition may be harmed.

As a result of these factors, our competitors may obtain regulatory approval of their drugs before we are able to, which may limit our ability to develop or commercialize etripamil and any future product candidates.

Our competitors may also develop therapies that are safer, more effective, more widely accepted or less expensive than ours, and may also be more successful than we in manufacturing and marketing their drugs.

These advantages could render our product candidates obsolete or non-competitive before we can recover the costs of such product candidates’ development and commercialization.

As a result of these factors, our competitors may obtain regulatory approval of their drugs before we are able to, which may limit our ability to develop or commercialize future product candidates.

Our competitors may also develop therapies that are safer, more effective, more widely accepted or less expensive than ours, and may also be more successful than we

in manufacturing and marketing their drugs.

These advantages could render our product candidates obsolete or noncompetitive before we can recover the costs of such product candidates’ development and commercialization.

Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources being concentrated among a smaller number of our competitors.

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production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad;

business interruptions resulting from pandemics and public health crisis (such as the COVID-19 pandemic), geopolitical actions, including war (such as the Russia-Ukraine and Israel-Hamas wars) and terrorism or natural disasters including earthquakes, typhoons, floods and fires.

business interruptions resulting from pandemics and public health crisis (such as the COVID-19 pandemic), geopolitical actions, including war , and terrorism or natural disasters including earthquakes, typhoons, floods and fires.

We have no prior experience in these areas.

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On May 15, 2021, the Company entered into a license and collaboration agreement, or the License Agreement, with Corxel, which is an entity affiliated with RTW Investments, LP, or “RTW,” an existing shareholder of the Company.

Under the License Agreement, the Company granted Corxel exclusive development and commercialization rights to any pharmaceutical product that uses a device to deliver etripamil by nasal spray for all prophylactic and therapeutic uses in humans in the following territories:

humans in the following territories:

People’s Republic of China, including mainland China, Hong Kong, Macau, and Taiwan.

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In addition, any failure by the Company or its partners to maintain compliance with applicable laws and regulations or obtain and maintain required licenses and permits may result in the suspension or termination of its business activities in China or create other legal risks and the continuing compliance of such changing regulation may require the Company to incur substantial legal and regulatory expenses.

Coverage and adequate reimbursement may not be available for etripamil or any future product candidates, which could make it difficult for us to gain market acceptance.

Market acceptance and sales of any product candidates that we commercialize, if approved, will depend in part on the extent to which reimbursement for these drugs and related treatments will be available from third-party payors, including government health administration authorities, managed care organizations and other private health insurers.

Third-party payors decide for which therapies and establish reimbursement levels.

Coverage and adequate reimbursement may not be available for CARDAMSYT or any future product candidates, which could make it difficult for us to gain market acceptance.

Market acceptance and sales of any product candidates that we commercialize, will depend in part on the extent to which reimbursement for these drugs and related treatments will be available from third-party payors, including government health administration authorities, managed care organizations and other private health insurers.

Third-party payors decide which therapies are reimbursed and establish reimbursement levels.

While no uniform policy for coverage and reimbursement exists in the United States, third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own coverage and reimbursement policies.

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Each payor determines whether or not it will provide coverage for a therapy, what amount it will pay the manufacturer for the therapy, and on what tier of its formulary it will be placed.

The position on a payor’s list of covered drugs, or formulary, generally determines the co-payment that a patient will need to make to obtain the therapy and can strongly influence the adoption of such therapy by patients and physicians.

The position on a payor’s list of covered drugs, or formulary, generally determines the copayment that a patient will need to make to obtain the therapy and can strongly influence the adoption of such therapy by patients and physicians.

Patients who are prescribed treatments for their conditions and providers prescribing such services generally rely on third-party payors to reimburse all or part of the associated healthcare costs.

Patients are unlikely to use our products unless coverage is provided and reimbursement is adequate to cover a significant portion of the cost of our products.

Further, the increased emphasis on cost containment in the United States and abroad will put additional pressure on product pricing, reimbursement and usage.

For example, HHS imposes rebates on many Medicare Part B and Medicare Part D products to penalize price increases that outpace inflation on an annual basis.

HHS has also been empowered to negotiate the price of certain single-source drugs that have been on the market for at least seven (7) years covered under Medicare as part of the Medicare Drug Price Negotiation Program.

Each year up to twenty (20) products will be selected by HHS for the Medicare Drug Price Negotiation Program.

Products subject to the Medicare Drug Price Negotiation Program are expected to experience a significant reduction in reimbursement from the Medicare program on a per unit basis.

Third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications.

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Therefore, even if favorable coverage and reimbursement status is attained for one or more drug products for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

If we are unable to obtain and maintain sufficient third-party coverage and adequate reimbursement for our drug products, the commercial success of our

drug products may be greatly hindered, and our financial condition and results of operations may be materially and adversely affected.

If we are unable to obtain and maintain sufficient third-party coverage and adequate reimbursement for our drug products, the commercial success

of our drug products may be greatly hindered, and our financial condition and results of operations may be materially and adversely affected.

Product liability lawsuits against us could cause us to incur substantial liabilities and could limit commercialization of any product candidates that we may develop.

We face an inherent risk of product liability exposure related to the testing of etripamil or any future product candidates in clinical trials and may face an even greater risk if we commercialize any product candidate that we may develop.

We face an inherent risk of product liability exposure related to commercializing etripamil or testing and commercializing any future product candidates in clinical trials.

If we cannot successfully defend ourselves against claims that any such product candidates caused injuries, we could incur substantial liabilities.

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Risks Related to Regulatory Compliance

Even if we obtain and maintain approval for etripamil or any future product candidates from the FDA, we may never obtain approval of etripamil or any future product candidates outside of the United States, which would limit our market opportunities and could harm our business.

Even if we maintain approval for CARDAMYST, or we obtain and maintain approval for subsequent etripamil indications or any future product candidates from the FDA, we may never obtain approval of etripamil or any future product candidates outside of the United States, which would limit our market opportunities and could harm our business.

Approval of a product candidate in the United States by the FDA does not ensure approval of such product candidate by regulatory authorities in other countries or jurisdictions, and approval by one foreign regulatory authority does not ensure approval by regulatory authorities in other foreign countries or by the FDA.

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In some cases, the price that we intend to charge for any product candidates, if approved, is also subject to approval.

Obtaining approval for etripamil or any future product candidates in the European Union from the European Commission following the opinion of the European Medicines Agency, if we choose to submit a marketing authorization application there, would be a lengthy and expensive process.

Even if a product candidate is approved, the FDA or the

European Commission, as the case may be, may limit the indications for which the drug may be marketed, require extensive warnings on the drug labeling or require expensive and time-consuming additional clinical trials or reporting as conditions of approval.

application there, would be a lengthy and expensive process.

Even if a product candidate is approved, the FDA or the European Commission, as the case may be, may limit the indications for which the drug may be marketed, require extensive warnings on the drug labeling or require expensive and time-consuming additional clinical trials or reporting as conditions of approval.

Obtaining foreign regulatory approvals and compliance with foreign regulatory requirements could result in significant delays, difficulties and costs for us and could delay or prevent the introduction of etripamil or any future product candidates in certain countries.

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If we fail to comply with the regulatory requirements, our target market will be reduced and our ability to realize the full market potential of etripamil or any future product candidates will be harmed and our business, financial condition, results of operations and prospects could be harmed.

Even if we obtain regulatory approval for etripamil or any future product candidates, they will remain subject to ongoing regulatory oversight.

Even if we obtain regulatory approvals for etripamil or any future product candidates, such approvals will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, advertising, promotion, sampling, record-keeping and submission of safety and other post-market information.

CARDAMYST, and any subsequent etripamil indications or any future product candidates, if approved, will remain subject to ongoing regulatory oversight.

CARDAMYST, and any subsequent etripamil indications or any future product candidates, if approved, will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, advertising, promotion, sampling, record-keeping, and submission of safety and other post-market information.

Any regulatory approvals that we receive for etripamil or any future product candidates may also be subject to a REMS, limitations on the approved indicated uses for which the drug may be marketed or to the conditions of approval, or contain requirements for potentially costly post-marketing testing, including Phase 4 trials, and surveillance to monitor the quality, safety, and efficacy of the drug.

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If we, or a regulatory authority, discover previously unknown problems with a drug, such as adverse events of unanticipated severity or frequency, or problems with the facility where the drug is manufactured or if a regulatory authority disagrees with the promotion, marketing, or labeling of that drug, a regulatory authority may impose restrictions relative to that drug, the manufacturing facility or us, including requesting a recall or requiring withdrawal of the drug from the market or suspension of manufacturing.

If we fail to comply with applicable regulatory requirements following approval of etripamil or any future product candidates, a regulatory authority may:

If we fail to comply with applicable regulatory requirements for CARDAMYST or any subsequent etripamil indications, a regulatory authority may:

issue an untitled letter or warning letter asserting that we are in violation of the law;

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Physicians, on the other hand, may prescribe products for off-label uses.

Although the FDA and other regulatory agencies do not regulate a physician’s choice of drug treatment made in the physician’s independent medical judgment, they do restrict promotional communications from companies or their sales force with respect to off-label uses of products for which marketing clearance has not been issued.

Although the FDA and other regulatory agencies do not regulate a physician’s choice of drug treatment made in the physician’s independent medical judgment, they do regulate promotional communications from companies or their sales force with respect to off-label uses of products for which marketing clearance has not been issued.

However, biopharmaceutical companies may share truthful and not misleading information that is otherwise consistent with the labeling.

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Remuneration has been broadly defined to include anything of value, including cash, improper discounts, and free or reduced-price items and services.

Additionally, the intent standard under the federal Anti-Kickback Statute was amended by the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively, “PPACA”, to a stricter standard such that a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

Additionally, the intent standard under the federal Anti-Kickback Statute was amended by PPACA, to a stricter standard such that a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

Further, PPACA codified case law that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act.

The federal false claims, including the False Claims Act, and civil monetary penalties laws, which prohibit individuals or entities from, among other things, knowingly presenting, or causing to be presented, false or fraudulent claims for payment of federal funds, and knowingly making, or causing to be made, a false record or statement material to a false or fraudulent claim to avoid, decrease or conceal an obligation to pay money to the federal government.

or knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement, in connection with the delivery of, or payment for, healthcare benefits, items or services.

The federal Health Information Insurance Portability and Accountability Act of 1996, or “HIPAA,” prohibits, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, or knowingly and willfully falsifying, concealing, or covering up a material fact or making any materially false statement,

in connection with the delivery of, or payment for, healthcare benefits, items, or services.

Similar to the U.S.

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federal government and the states and any other countries in which we conduct our business, including our research, and the sales, marketing, and distribution of our product candidates and products once they have obtained marketing authorization.

Analogous state and foreign anti-kickback and false claims laws that may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third party payors, including private insurers, or that apply regardless of payor;

state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government;

state and local laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures;

state laws that require the reporting of information related to drug pricing;

state and local laws requiring the registration of pharmaceutical sales representatives;

and state and foreign laws governing the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.

Additionally, some state and local laws require certain regulatory licenses to manufacture or distribute our products commercially and/or the registration of pharmaceutical sales representatives in the jurisdiction.

Further, some state laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government in addition to requiring manufacturers to report information related to payments to physicians and other health care providers or marketing expenditures.

State and foreign laws also govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.

Ensuring that our business arrangements with third parties comply with applicable healthcare laws and regulations will likely be costly.

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Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development, manufacturing, sales, marketing, or distribution activities.

Uncertainties resulting from the initiation and continuation of litigation or other

proceedings relating to applicable healthcare laws and regulations could have a material adverse effect on our ability to compete in the marketplace.

Uncertainties resulting from the initiation and continuation of litigation or other proceedings relating to applicable healthcare laws and regulations could have a material adverse effect on our ability to compete in the marketplace.

Healthcare legislative reform measures may have a negative impact on our business and results of operations.

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There have been amendments, as well as executive, judicial and Congressional challenges, to certain aspects of the PPACA.

For example, on August 16, 2022, the Inflation Reduction Act of 2022, or “IRA,” was signed into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in PPACA marketplaces through plan year 2025.

The IRA also eliminates the "donut hole" under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and through a newly established manufacturer discount program.

It is possible that the PPACA will be subject to judicial or Congressional challenges in the future.

It is unclear how any additional healthcare reform measures of the second Trump administration will impact the PPACA and our business.

Further, in the United States there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under government payor programs, and review the relationship between pricing and manufacturer patient programs.

At the federal level, the IRA, among other things (i) directs HHS to negotiate the price of certain high-expenditure, single-source drugs that have been on the market for at least seven years and covered under Medicare, or the “Medicare Drug Price Negotiation Program,” and (ii) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation.

These provisions began to take effect progressively starting in fiscal year 2023.

On August 15, 2024, HHS announced the agreed-upon prices of the first ten drugs that were subject to price negotiations, although the Medicare Drug Price Negotiation program is currently subject to legal challenges.

On January 17, 2025, HHS selected fifteen additional products covered under Part D for price negotiation in 2025.

Each year thereafter more Part B and Part D products will become subject to the Medicare Drug Price Negotiation Program.

On December 8, 2023, the National Institute of Standards and Technology published for comment a Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights which for the first time includes the price of a product as one factor an agency can use when deciding to exercise march-in rights.

While march-in rights have not previously been exercised, it is uncertain if that will continue under the new framework.

At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

For example, on January 5, 2024, the FDA approved Florida’s Section 804 Importation Program, or “SIP”, proposal to import certain drugs from Canada for specific state healthcare programs.

It is unclear how this program will be implemented, including which drugs will be chosen, and whether it will be subject to legal challenges in the United States or Canada.

Other states have also submitted SIP proposals that are pending review by the FDA.

Any such approved importation plans, when implemented, may result in lower drug prices for products covered by those programs.

We expect that additional U.S.

healthcare reform measures will be adopted in the future, any of which could limit the amounts that the U.S.

federal government will pay for healthcare products and services, which could result in reduced demand for etripamil or any future product candidates or additional pricing pressures.

For example, on July 4, 2025, the One Big Beautiful Bill Act, or the OBBBA, was signed into law, which narrowed access to PPACA marketplace exchange enrollment and declined to extend the PPACA enhanced advanced premium tax credits that expired at the end of 2025, which, among other provisions in the law, are anticipated to reduce the number of Americans with health insurance.

The OBBBA is also expected to reduce Medicaid spending and enrollment by implementing work requirements for some beneficiaries, capping state-directed payments, reducing federal funding, and limiting provider taxes used to fund the program.

Congress is considering proposed legislation intended to further reduce healthcare costs with alternatives to replace the expired PPACA subsidies.

In addition, other legislative changes have been proposed and adopted since the PPACA was enacted.

On August 2, 2011, the Budget Control Act of 2011 was signed into law, which includes reductions to Medicare payments to providers of 2% per fiscal year, which went into effect on April 1, 2013 and, due to subsequent legislative amendments to the statute, will remain in effect until 2032 unless additional Congressional action is taken Additionally, on March 11, 2021, the American Rescue Plan Act of 2021 was signed into law, which eliminated the statutory Medicaid drug rebate cap, currently set at

100% of a drug’s average manufacturer price, for single source and innovator multiple source drugs, beginning January 1, 2024.

We cannot predict the likelihood, nature or extent of health reform initiatives that may arise from future legislation or administrative action in the United States or any other jurisdiction, particularly given the recent change in administration.

The current Trump administration is pursuing policies to reduce regulations and expenditures across government including at HHS, the FDA, the Centers for Medicare & Medicaid Services and related agencies.

These changes include aggregate reductions to Medicare payments to providers of 2% per fiscal year, which began in 2013 and will remain in effect until 2032 unless additional Congressional action is taken.

The current administration is pursuing policies to reduce regulations and expenditures across government agencies including at HHS, the FDA, the Centers for Medicare & Medicaid Services, or “CMS,” and related agencies.

These actions, presently directed by executive orders or memoranda from the Office of Management and Budget, may propose policy changes that create additional uncertainty for our business.

These actions may include, for example, directives to reduce agency workforce, rescinding a Biden administration executive order tasking the Center for Medicare and Medicaid Innovation to consider new payment and healthcare models to limit drug spending and eliminating the Biden administration’s executive order that directed HHS to establishing an AI task force and developing a strategic plan.

Additionally, in its June 2024 decision in Loper Bright, the U.S.

Supreme Court overturned the longstanding Chevron doctrine, under which courts were required to give deference to regulatory agencies’ reasonable interpretations of ambiguous federal statutes.

The Loper Bright decision could result in additional legal challenges to current regulations and guidance issued by federal agencies applicable to our operations, including those issued by the FDA.

Congress may introduce and ultimately pass health care related legislation that could impact the drug approval process and make changes to the Medicare Drug Price Negotiation Program created under the IRA.

If we, or any third parties we may engage, are slow or unable to adapt to changes in existing or new requirements or policies, or if we or such third parties are not able to maintain regulatory compliance, we may not achieve or sustain profitability.

For example, the current administration has announced agreements with several pharmaceutical companies that require the drug manufacturers to offer, through a direct to consumer platform, or “TrumpRx” U.S.

patients and Medicaid programs prescription drug Most-Favored Nation pricing equal to or lower than those paid in other developed nations, with additional mandates for direct-to-patient discounts and repatriation of foreign revenues.

Other recent actions, for example, include (1) directing agencies to reduce agency workforce and cut programs;

(2) directing HHS and other agencies to lower prescription drug costs through a variety of initiatives;

(3) imposing tariffs on imported pharmaceutical products;

and (4) as part of the Make America Healthy Again, or “MAHA,” Commission’s Strategy Report released in September 2025, working across government agencies to increase enforcement on direct-to-consumer pharmaceutical advertising.

Additionally, the current administration recently called on Congress to enact "The Great Healthcare Plan," to codify and expand Most-Favored Nation pricing, lower government subsidies to private insurance companies, increase healthcare price transparency, expand pharmaceutical drugs available for over-the-counter purchase, and enact restrictions on pharmacy benefit manager, or “PBM,” payment methodologies, among other things.

These actions and policies may significantly reduce U.S.

drug prices, potentially impacting manufacturers’ global pricing strategies and profitability, while increasing their operational costs and compliance risks.

In June 2024, the U.S.

Supreme Court’s Loper Bright decision greatly reduced judicial deference to regulatory agencies, which could increase successful legal challenges to federal regulations affecting our operations.

Congress may introduce and ultimately pass health care related legislation that could impact the drug approval process and make changes to the Medicare Drug Price Negotiation Program.

Our business involves the use of hazardous materials and we and our third-party manufacturers and suppliers must comply with environmental laws and regulations, which can be expensive and restrict how we do business.

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We cannot eliminate the risk of contamination, which could cause an interruption of our commercialization efforts, research and development efforts and business operations, environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products.

Although we believe that the safety procedures utilized by our third-party manufacturers for handling and disposing of these materials generally comply with the standards prescribed by these laws and regulations, we cannot guarantee that this is the case or eliminate the risk of accidental contamination or injury from these materials.

Although we believe that the safety procedures utilized by our third-party

manufacturers for handling and disposing of these materials generally comply with the standards prescribed by these laws and regulations, we cannot guarantee that this is the case or eliminate the risk of accidental contamination or injury from these materials.

In such an event, we may be held liable for any resulting damages and such liability could exceed our resources and state or federal or other applicable authorities may curtail our use of certain materials and/or interrupt our business operations.

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The facilities used by our contract manufacturers to manufacture etripamil and any future product candidates must be approved by the FDA pursuant to inspections.

We do not control the manufacturing process of, and are completely dependent on, our contract manufacturing partners for compliance with the regulatory requirements, known as cGMPs for manufacture of active drug substances, nasal spray device, and finished product candidates.

We do not control the manufacturing process of, and are completely dependent on, our contract manufacturing partners for compliance with regulatory requirements including current Good Manufacturing Practices or, “cGMPs,” for manufacture of active drug substances, nasal spray devices, and finished product candidates.

If our contract manufacturers cannot successfully manufacture material that conforms to our specifications and the strict regulatory requirements of the FDA or others, we will not be able to secure and/or maintain regulatory approval for our product candidates.

In addition, we have no control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and qualified

In addition, we have no control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and qualified personnel.

We intend to use multiple contract manufacturers for clinical and commercial supply of our drug product and drug substance.

As such, we will need to demonstrate to the FDA that the drug product and drug substance from these contract manufacturers are comparable, which may include conducting additional equivalence studies.

If the FDA or a comparable foreign regulatory authority does not approve these facilities for the manufacture of our product candidates or if it withdraws any such approval in the future, we may need to find alternative manufacturing facilities, which would significantly impact our ability to develop, obtain regulatory approval for or market our product candidates, if approved.

Any significant delay in the supply of a product candidate, or the raw material components thereof, for an ongoing clinical trial due to the need to replace a third-party manufacturer could considerably delay completion of our clinical trials, product testing, and potential regulatory approval of our product candidates

Further, we also will rely on third-party manufacturers to supply us with sufficient quantities of etripamil and any future product candidates, if approved, for commercialization.

We do not yet have a commercial supply agreement for commercial quantities of drug substance, drug product or nasal spray device.

We do not yet have a commercial supply agreement for the nasal spray device.

If we are not able to meet market demand for any approved product, it would negatively affect our ability to generate revenue, harm our reputation, and could have a material and adverse effect on our business and financial condition.

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Manufacturing errors could negatively impact market acceptance of any of our product candidates that receive approval, result in negative press coverage, or increase our liability.

Further, our reliance on third-party manufacturers entails risks to which we would not be subject if we manufactured product candidates ourselves, including:

Further, our reliance on third-party manufacturers entails risks to which we may not be subject if we manufactured product candidates ourselves, including:

inability to meet our product specifications and quality requirements consistently;

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we may not own, or may have to share, the intellectual property rights to any improvements made by our third-party manufacturers in the manufacturing process for our product candidates;

operations of our third party manufacturers or suppliers could be disrupted by conditions unrelated to our business or operations, including public health emergencies, natural disasters, such as earthquakes, fires or floods, the bankruptcy of the manufacturer or supplier, carrier disruptions or increased costs that are beyond

our control, and global macro uncertainty related to Russia’s incursion into Ukraine or Israel-Hamas war;

operations of our third-party manufacturers or suppliers could be disrupted by conditions unrelated to our business or operations, including public health emergencies, natural disasters, such as earthquakes, fires or floods, the bankruptcy of the manufacturer or supplier, carrier disruptions or increased costs that are beyond our control, and global macro uncertainty related to geopolitical conflicts;

the possibility that, to the extent we need to complete technology transfers to a backup CMO or alternative CMO, we may be subject to additional costs associated with the technology transfer or dependent on the cooperation of our current CMOs.

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We rely on third parties to conduct, supervise and monitor our preclinical studies and clinical trials, and if those third parties perform in an unsatisfactory manner, it may harm our business.

We have engaged CROs to conduct our Phase 3 clinical trials of etripamil for the treatment of PSVT, and our Phase 2 clinical trial of etripamil for the treatment of AFib-RVR, and we expect to engage a CRO for future clinical trials of etripamil and any future product candidates.

We have engaged CROs to conduct our Phase 2 clinical trial of etripamil for the treatment of AFib-RVR, and we expect to engage a CRO for future clinical trials of etripamil and any future product candidates.

We do not currently have the ability to independently conduct any clinical trials.

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Nevertheless, we will be responsible for ensuring that each of our preclinical studies and clinical trials is conducted in accordance with the applicable protocol, legal, regulatory and scientific standards, and our reliance on the CROs does not relieve us of our regulatory responsibilities.

We and our CROs are required to comply with the good laboratory practices, or “GLPs,” and GCPs, which are regulations and guidelines enforced by the FDA and comparable foreign regulatory authorities in the form of International Conference on Harmonization guidelines for any of our product candidates that are in preclinical and clinical development.

The regulatory authorities enforce GCPs through periodic inspections of trial sponsors, principal investigators and clinical trial sites.

Although we rely on CROs to conduct GCP-compliant clinical trials, we remain responsible for ensuring that each of our GLP preclinical studies and clinical trials is conducted in accordance with its investigational plan and protocol and applicable laws and regulations, and our reliance on the CROs does not relieve us of our regulatory responsibilities.

If we or our CROs fail to comply with GCPs, the clinical data generated in our clinical trials may be deemed unreliable, and the FDA or comparable foreign regulatory authorities may require us to perform additional clinical trials before approving our marketing applications.

We and our CROs are required to comply with good laboratory practices, or “GLPs,” and GCPs, which are regulations and guidelines enforced by the FDA and comparable foreign regulatory authorities in the form of International Conference on Harmonization guidelines for any of our product candidates that are in preclinical and clinical development.

Regulatory authorities enforce GCPs through periodic inspections of trial sponsors, principal investigators, and clinical trial sites.

Our reliance on the CROs does not relieve us of our regulatory responsibilities.

marketing applications.

Accordingly, if our CROs fail to comply with these regulations or fail to recruit a sufficient number of subjects, we may be required to repeat clinical trials, which would delay the regulatory approval process.

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There are a limited number of device suppliers that address our particular design requirements.

In addition, increasing the scale of production inherently creates increased risk of manufacturing errors, and we may not be able to adequately inspect every device that is produced, and it is possible that individual devices may fail to perform as designed.

While we intend to explore alternative nasal spray devices for the delivery of etripamil that are produced by other suppliers to have backup sources for future commercial needs, we may not identify other nasal device suppliers that meet our requirements, and such alternative devices may not be as effective at the delivery of etripamil as our current supplier’s device.

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Even if we reach an agreement for commercial supply, if we do not have additional nasal spray device suppliers, our sole supplier may be unable to meet our demands.

Unpredictability of supply could have a material adverse effect on our commercialization plans for etripamil, if approved, and could have a material adverse effect on our business and financial condition.

Our finished drug product in the intra-nasal delivery system will be regulated as a drug/device combination product.

We may experience delays in obtaining regulatory approval of etripamil given the increased complexity of the review process when approval of the product and a delivery device is sought under a single marketing application.

In the United States, each component of a combination product is subject to the requirements established by the FDA for that type of component, whether a drug, biologic, or device.

The delivery system device would be subject to FDA device requirements regarding design, performance and validation as well as human factors testing, among other things.

Unpredictability of supply could have a material adverse effect on our commercialization plans for etripamil and could have a material adverse effect on our business and financial condition.

Delays in or failure of the studies conducted by us, or failure of our Company, our collaborators, if any, or the third-party providers or suppliers to obtain or maintain regulatory approval could result in increased development costs, delays in or failure to obtain regulatory approval, and associated delays in etripamil reaching the market.

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As a result, the issuance, scope, validity, and commercial value of our patent rights cannot be predicted with any certainty.

Moreover, we may be subject to a third-party pre-issuance submission of prior art to the U.S.

Moreover, we may be subject to a third-party preissuance submission of prior art to the U.S.

Patent and Trademark Office, or “USPTO,” or become involved in opposition, derivation, reexamination, inter parties review, post grant review, or interference proceedings, in the United States or elsewhere, challenging our patent rights or the patent rights of others.

An adverse determination in any such submission, proceeding or litigation could reduce the scope of, or invalidate, our patent rights, allow third parties to commercialize our technology or product candidates and

compete directly with us, without payment to us, or result in our inability to manufacture or commercialize products without infringing third-party patent rights.

An adverse determination in any such submission, proceeding, or litigation could reduce the scope of, or invalidate, our patent rights, allow third parties to commercialize our technology or product candidates and compete directly with us, without payment to us, or result in our inability to manufacture or commercialize products without infringing third-party patent rights.

Our pending and future patent applications may not result in patents being issued that protect our technology or product candidates, in whole or in part, or which effectively prevent others from commercializing competitive technologies and products.

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Non-compliance events that could result in abandonment or lapse of a patent or patent application include, but are not limited to, failure to respond to official actions within prescribed time limits, non-payment of fees, and failure to properly legalize and submit formal documents.

If we fail to maintain the patents and patent applications covering our products or technologies, we may not be able to stop a competitor from marketing products that are the same as or similar to etripamil or any future product candidates, which would have a material adverse effect on our business.

If we fail to maintain the patents and patent applications covering our products or

technologies, we may not be able to stop a competitor from marketing products that are the same as or similar to etripamil or any future product candidates, which would have a material adverse effect on our business.

In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules.

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Given the amount of time required for the development, testing, and regulatory review of new product candidates, such as etripamil, patents protecting such candidates might expire before or shortly after such candidates are commercialized.

We expect to seek extensions of patent terms in the United States and, if available, in other countries where we are prosecuting

We expect to seek extensions of patent terms in the United States and, if available, in other countries where we are prosecuting patents.

In the United States, the Drug Price Competition and Patent Term Restoration Act of 1984 permits a patent term extension of up to five years beyond the normal expiration of the patent, which is limited to the approved indication (or any additional indications approved during the period of extension).

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In addition, in a patent infringement proceeding, there is a risk that a court will decide that a patent of ours is invalid or unenforceable, in whole or in part, and that we do not have the right to stop the other party from using the invention at issue.

There is also a risk that, even if the validity of such

patents is upheld, the court will construe the patent’s claims narrowly or decide that we do not have the right to stop the other party from using the invention at issue on the grounds that our patents do not cover the invention.

There is also a risk that, even if the validity of such patents is upheld, the court will construe the patent’s claims narrowly or decide that we do not have the right to stop the other party from using the invention at issue on the grounds that our patents do not cover the invention.

An adverse outcome in a litigation or proceeding involving our patents could limit our ability to assert our patents against those parties or other competitors and may curtail or preclude our ability to exclude third parties from making and selling similar or competitive products.

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patent claim, there is no assurance that a court of competent jurisdiction would invalidate the claims of any such U.S.

If we are found to infringe a third party’s valid and enforceable intellectual property rights, we could be required to obtain a license from such third party to continue developing, manufacturing and marketing our product candidate(s) and technology.

If we are found to infringe a third party’s valid and enforceable intellectual

property rights, we could be required to obtain a license from such third party to continue developing, manufacturing and marketing our product candidate(s) and technology.

However, we may not be able to obtain any required license on commercially reasonable terms or at all.

Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors and other third parties access to the same technologies licensed to us, and it could require us to make substantial licensing and royalty payments.

Even if we were able to obtain a license, it could be nonexclusive, thereby giving our competitors and other third parties access to the same technologies licensed to us, and it could require us to make substantial licensing and royalty payments.

We could be forced, including by court order, to cease developing, manufacturing and commercializing the infringing technology or product candidate.

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We may need to license intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms.

A third party may hold intellectual property rights, including patent rights, that are important or necessary to the development of etripamil or any future product candidates.

A third party may hold intellectual property rights, including patent rights, which are important or necessary to the development of etripamil or any future product candidates.

It may be necessary for us to use the patented or proprietary technology of third parties to commercialize our product candidates, in which case we would be required to obtain a license from these third parties.

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Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations.

In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained.

In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the

value of patents, once obtained.

Depending on actions by the U.S.

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For example, the complexity and uncertainty of European patent laws have also increased in recent years.

In Europe, a new unitary patent system is scheduled to be introduced by June 1, 2023, which would significantly impact European patents, including those granted before the introduction of such a system.

Under the unitary patent system, European applications will soon have the option, upon grant of a patent, of becoming a Unitary Patent which will be subject to the jurisdiction of the Unitary Patent Court (UPC).

As the UPC is a new court system, there is no precedent for the court, increasing the uncertainty of any litigation.

Patents granted before the implementation of the UPC will have the option of opting out of the jurisdiction of the UPC and remaining as national patents in the UPC countries.

Patents that remain under the jurisdiction of the UPC will be potentially

vulnerable to a single UPC-based revocation challenge that, if successful, could invalidate the patent in all countries who are signatories to the UPC.

In Europe, a unitary patent system was launched on June 1, 2023.

Under the unitary patent system, European applications have the option, upon grant of a patent, of becoming a Unitary Patent which is subject to the jurisdiction of the Unitary Patent Court, or “UPC.” As the UPC is a relatively new court system, there is little precedent for the court, increasing the uncertainty of any litigation.

Patents granted before the implementation of the UPC had the option of opting out of the jurisdiction of the UPC and remaining as national patents in the UPC countries.

Patents that remain under the jurisdiction of the UPC are potentially vulnerable to a single UPC-based revocation challenge that, if successful, could invalidate the patent in all countries who are signatories to the UPC.

We cannot predict with certainty the long-term effects of any potential changes.

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Reliance on third parties requires us to share our proprietary information, which increases the possibility that such information will be misappropriated or disclosed.

Because we rely on third parties to develop and manufacture etripamil and any future product candidates, such as Corxel, or if we collaborate with additional third parties for the development or commercialization of etripamil or any future product candidates, we must, at times, share proprietary information with them.

Because we rely on third parties to develop and manufacture etripamil and any future product candidates, or if we collaborate with additional third parties for the development or commercialization of etripamil or any future product candidates, we must, at times, share proprietary information with them.

We seek to protect our proprietary technology in part by entering into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements, or other similar agreements with our advisors, employees, third-party contractors, and consultants prior to beginning research or disclosing proprietary information.

These agreements typically limit the rights of the third parties to use or disclose our confidential information.

Despite the contractual provisions employed when working with third parties, the need to share confidential information increases the risk that such information becomes known by our competitors, is inadvertently incorporated into the technology of others, or is disclosed or used in violation of these agreements.

incorporated into the technology of others, or is disclosed or used in violation of these agreements.

Given that our proprietary position is based, in part, on our know-how, a competitor’s discovery of our know-how or other unauthorized use or disclosure could have an adverse effect on our business and results of operations.

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Monitoring unauthorized uses and disclosures is difficult, and we do not know whether the steps we have taken to protect our proprietary technologies will be effective.

If any of the collaborators, scientific advisors, employees, contractors and consultants who are parties to these agreements breaches or violates the terms of any of these agreements, we may not have adequate remedies for any such

breach or violation.

If any of the collaborators, scientific advisors, employees, contractors, and consultants who are parties to these agreements breaches or violates the terms of any of these agreements, we may not have adequate remedies for any such breach or violation.

Moreover, if confidential information that is licensed or disclosed to us by our partners, collaborators, or others is inadvertently disclosed or subject to a breach or violation, we may be exposed to liability to the owner of that confidential information.

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We expect to rely on trademarks as one means to distinguish any of our product candidates that are approved for marketing from the products of our competitors.

We have not yet selected trademarks for etripamil and have not yet begun the process of applying to register trademarks for etripamil or any other product candidate.

Once we select trademarks and apply to register them, our trademark applications may not be approved.

Third parties may oppose our trademark applications or otherwise challenge our use of the trademarks.

In the event that our trademarks are successfully challenged, we could be forced to rebrand our products, which could result in loss of brand recognition and could require us to devote resources to advertising and marketing new brands.

Our competitors may infringe our trademarks, and we may not have adequate resources to enforce our trademarks.

In addition, any proprietary name we propose to use with etripamil or any future product candidate in the United States must be approved by the FDA, regardless of whether we have registered it, or applied to register it, as a trademark.

In addition, any proprietary name we propose to use with any future product candidate in the United States must be approved by the FDA, regardless of whether we have registered it, or applied to register it, as a trademark.

The FDA typically conducts a review of proposed product names, including an evaluation of the potential for confusion with other product names.

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If we are unable to protect the confidentiality of our proprietary information, our business and competitive position would be harmed.

In addition to seeking patent and trademark protection for etripamil and any future product candidate, we also rely on unpatented know-how, technology and other proprietary information, to maintain our competitive position.

In addition to seeking and/or maintaining patent and trademark protection for etripamil and any future product candidate, we also rely on unpatented know-how, technology and other proprietary information, to maintain our competitive position.

We seek to protect our proprietary information, in part, by entering into non-disclosure and confidentiality agreements with parties who have access to them, such as our employees, corporate collaborators, outside scientific collaborators, contract manufacturers, consultants, advisors, and other third parties.

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Competitors could purchase our products and replicate some or all of the competitive advantages we derive from our development efforts for technologies on which we do not have patent protection.

If any of our proprietary information were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent them, or those to whom they communicate, from using that technology or information to compete with us.

If any of our proprietary information were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent

them, or those to whom they communicate, from using that technology or information to compete with us.

If any of our proprietary information were to be disclosed to or independently developed by a competitor, our competitive position would be harmed.

We also seek to preserve the integrity and confidentiality of our data and other confidential information by maintaining physical security of our premises and physical and electronic security of our information technology systems.

While we have confidence in these individuals, organizations and systems, agreements or security measures may be breached and detecting the disclosure or misappropriation of confidential information and enforcing a claim that a party illegally disclosed or misappropriated confidential information is difficult, expensive and time-consuming, and the outcome is

unpredictable.

While we have confidence in these individuals, organizations, and systems, agreements or security measures may be breached and detecting the disclosure or misappropriation of confidential information and enforcing a claim that a party illegally disclosed or misappropriated confidential information is difficult, expensive and time-consuming, and the outcome is unpredictable.

Further, we may not be able to obtain adequate remedies for any breach.

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We may expand our organization in the future, and we may experience difficulties in managing this growth, which could disrupt our operations.

As the clinical development of etripamil progresses and as we expand our pipeline, we may, in the future, experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of research, drug development, regulatory affairs and, if etripamil or any future product candidates receives marketing approval, sales, marketing and distribution.

As we continue our efforts to commercialize CARDAMYST for the treatment of PSVT, pursue the development of subsequent etripamil indications and as we look to expand our pipeline, we may, in the future, experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of research, drug development, regulatory affairs, sales, marketing and distribution.

To manage any future growth, we will be required to continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit and train additional qualified personnel.

Due to our limited financial resources and the limited experience of our management team in managing a company with growth, we may not be able to effectively manage any expansion of our operations or recruit and train additional qualified personnel.

Any expansion of our operations may lead to significant costs and may divert our management and business development resources.

Any expansion of our operations may lead to significant

costs and may divert our management and business development resources.

Any inability to manage growth could delay the execution of our business plans or disrupt our operations.

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disruption of our business operations.

In the ordinary course of our business, we and the third parties with whom we work, process proprietary, confidential, and sensitive data, including personal data (such as health-related data), intellectual property and trade secrets (collectively, “sensitive information”).

Our internal computer systems and those of our current and any future collaborators, contractors, consultants, or other third parties with whom we work, are vulnerable to a variety of evolving threats, including but not limited to damage from malicious code (such as computer viruses and worms), unauthorized access, natural disasters, terrorism, war, social-engineering attacks (including through deep fakes, which may be increasingly more difficult to identify as fake, and phishing attacks), 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, attacks enhanced or facilitated by artificial intelligence, telecommunication and electrical failures, and other similar threats.

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Cyber-attacks are increasing in their frequency, sophistication, and intensity, and have become increasingly difficult to detect.

Cyber-attacks, malicious internet-based activity, online and offline fraud, and other similar activities can affect service reliability and threaten the confidentiality, integrity, and availability of information, and those of the third parties with whom we work.

Cyber-attacks, malicious internet-based activity, online and offline fraud, and other similar activities can affect service reliability and threaten the confidentiality, integrity, and availability our sensitive information and information technology systems, and those of the third parties with whom we work.

Cyber-attacks also could include phishing attempts or e-mail fraud to cause payments or information to be transmitted to an unintended recipient.

Some 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, the third parties with whom we work, 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 to produce, sell and distribute our goods and services.

During times of war and other major conflicts, we, the third parties with whom we work, may be vulnerable to a heightened risk of these attacks, including retaliatory cyber-attacks, which could materially disrupt our systems and operations, supply chain, and ability to produce, sell, and distribute our goods and services.

A significant system failure, accident, or security could cause interruptions in our operations, and could result in a disruption of our development programs and our business operations, whether due to a loss of our trade secrets or other proprietary information or other similar disruptions.

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Applicable data privacy and security obligations may require us, or we may voluntarily choose, to notify relevant stakeholders, including affected individuals, customers, regulators, and investors, of security incidents, or to take other actions, such as providing credit monitoring and identity theft protection services.

Such disclosures and related actions can be costly, and the disclosure or the failure to comply with such requirements could lead to adverse consequences.

We have implemented security measures designed to protect our information technology systems and infrastructure and detect, mitigate, and remediate vulnerabilities in our information systems (such as our hardware and/or software, including that of third parties with whom we work), but we may not, in the future be able to detect or prevent service interruptions or security breaches, in a timely manner that could adversely affect our business.

To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of sensitive information, we could incur liability, our competitive position could be harmed, and the further development and commercialization of our product candidates could be delayed.

Such disclosures and related actions can be costly, and the disclosure or failure to comply with such requirements could lead to adverse consequences.

While we have implemented security measures designed to protect against security incidents, there can be no assurance that these measures will be effective.

We take steps to detect, mitigate, and remediate vulnerabilities in our information systems (such as our hardware and/or software, including that of third parties with whom we work), but we may not, in the future, be able to detect and remediate all such vulnerabilities including on a timely basis.

Further, we have experienced and may in the future 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.

To the extent that any

disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of sensitive information, we could incur liability, our competitive position could be harmed, and the further development and commercialization of our product candidates could be delayed.

We may expend significant resources or modify our business activities (including our clinical trial activities) to try to protect against security incidents.

Further, we have (and may in the future) experienced delays in developing and deploying remedial measures and patches designed to address identified vulnerabilities.

Certain data privacy and security obligations have required us to implement and maintain specific security measures or industry-standard or reasonable security measures to protect our information technology systems and sensitive information.

It may be difficult and/or costly to detect, investigate, mitigate, contain, and remediate a security incident.

Our efforts to do so may not be successful.

Actions taken by us or the

third parties with whom we work to detect, investigate, mitigate, contain, and remediate a security incident could result in outages, data losses, and disruptions of our business.

Actions taken by us or the third parties with whom we work to detect, investigate, mitigate, contain, and remediate a security incident could result in outages, data losses, and disruptions of our business.

Threat actors may also gain access to other networks and systems after a compromise of our networks and systems.

For example, threat actors may use an initial compromise of one part of our environment to gain access to other parts of our environment, or leverage a compromise of our networks or systems to gain access to the networks or systems of third parties with whom we work, such as through phishing or supply chain attacks.

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.

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While we may be entitled to damages if the third parties with whom we work fail to satisfy their privacy or security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such an 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 that of the third parties with whom we work have not been compromised.

Any of the previously identified or similar threats have in the past and may in the future cause a security incident or other interruption that have in the past and may in the future 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 with whom we work.

A security incident or other interruption could disrupt our ability (and that of the third parties with whom we work) to provide our services.

If we (or the third parties with whom we work) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences, such as government enforcement actions (for example, investigations, fines, penalties, audits, and inspections);

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Additionally, sensitive information of the Company could be leaked, disclosed, or revealed as a result of or in connection with our employees’, personnel’s, or vendors’ use of generative artificial intelligence, or “AI,” technologies.

Any sensitive information (including confidential, competitive, proprietary, or personal data) that we input into a third-party generative AI or machine learning (“ML”) platform could be leaked or disclosed to others, including if sensitive information is used to train the third parties’ AI/ML model.

Additionally, where an AI/ML model ingests personal data and makes connections using such data, those technologies may reveal other personal or sensitive information generated by the model.

Moreover, AI/ML models may create flawed, incomplete, or inaccurate outputs, some of which may appear correct.

This may happen if the inputs that the model relied on were inaccurate, incomplete or flawed (including if a bad actor “poisons” the AI/ML with bad inputs or logic), or if the logic of the AI/ML is flawed (a so-called “hallucination”).

We may use AI/ML outputs to make certain decisions.

Any sensitive information (including confidential, competitive, proprietary, or personal data) that we input into a third-party generative AI or platform could be leaked or disclosed to others, including if sensitive information is used to train the third parties’ AI technologies.

Additionally, where an AI technology ingests personal data and makes connections using such data, those technologies may reveal other personal or sensitive information generated by the model.

Moreover, AI technologies may create flawed, incomplete, or inaccurate outputs, some of which may appear correct.

This may happen if the inputs that the model relied on were inaccurate, incomplete or flawed (including if a bad actor “poisons” the AI technology with bad inputs or logic), or if the logic of the AI technology is flawed (a so-called “hallucination”).

We may use AI technology outputs to make certain decisions.

Due to these potential inaccuracies or flaws, the model could be biased and could lead us to make decisions that could bias certain individuals (or classes of individuals), and adversely impact their rights, employment, and ability to obtain certain pricing, products, services, or benefits.

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For example, Washington’s My Health My Data Act, or “MHMD,” broadly defines consumer health data, places restrictions on processing consumer health data (including imposing stringent requirements for consents), provides consumers certain rights with respect to their health data, and creates a private right of action to allow individuals to sue for violations of the law.

Other states are considering and may adopt similar laws.

Other states have passed, are considering, and may adopt similar laws.

Outside the United States, an increasing number of laws, regulations, and industry standards govern data privacy and security.

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We are conducting clinical trial activities in Europe, which subject us to European data protection laws, including the EU GDPR and the UK GDPR.

The GDPR establishes requirements applicable to the processing of personal data (i.e., data which identifies an individual or from which an individual is identifiable).

The GDPR establishes requirements applicable to the processing of personal data (i.e., data which identifies an individual or from which an individual is

identifiable).

The GDPR creates significant and complex compliance burdens for companies such as:

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introducing the obligation to carry out so-called data protection impact assessments in certain circumstances;

establishing limitations on collection and retention of personal data through ‘data

minimization’ and ‘storage limitation’ principles;

establishing limitations on collection and retention of personal data through ‘data minimization’ and ‘storage limitation’ principles;

establishing obligations to implement ‘privacy by design’;

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introducing the obligation to provide notice of certain significant personal data breaches to the relevant supervisory authority(ies) and affected individuals;

and mandating the appointment of representatives in the United Kingdom and/or European Union in certain circumstances.

and mandating the appointment of representatives in the United Kingdom, or the “UK,” and/or European Union in certain circumstances.

The processing of “special category personal data”, such as health information, may also impose heightened compliance burdens under the GDPR.

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This may be onerous and materially adversely affect our business, financial condition, results of operations, and prospects.

Regulators in the United States such as the Department of Justice are also increasingly scrutinizing certain personal data transfers and have proposed and enacted certain data localization requirements, for example, the Biden Administration’s executive order Preventing Access to Americans’ Bulk Sensitive Personal Data and United States Government-Related Data by Countries of Concern.

A particular issue presented by the GDPR is the restriction on transfers of personal data from Europe to the United States and most other countries unless the parties to the transfer have implemented specific safeguards to protect the transferred personal data.

In the ordinary course of business, we transfer personal data from Europe and other jurisdictions to the United States or other countries.

Europe and other jurisdictions have enacted laws requiring data to be localized or limiting the transfer of personal data to other countries.

In particular, the European Economic Areas, or “EEA,” and the UK have significantly restricted the transfer of personal data to the United States and other countries whose privacy laws it generally believes are inadequate.

One of the primary safeguards allowing U.S.

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However, these mechanisms are subject to legal challenges, and there is no assurance that we can satisfy or rely on these measures to lawfully transfer personal data to the United States.

As such, if we are unable to implement a valid solution for personal data transfers from Europe, including, we will face increased exposure to regulatory actions, substantial fines and injunctions against processing personal data from Europe.

Inability to import personal data from Europe may also:

restrict our activities in Europe;

limit our ability to collaborate with partners as well as other service providers, contractors and other companies subject to European data protection laws;

and require us to increase our data processing capabilities in Europe at significant expense.

Restrictions on our ability to import personal data from Europe could therefore impact our clinical trial activities in Europe and limit our ability to collaborate with CROs and other third parties subject to European data protection laws.

Additionally, other countries outside of Europe have enacted or are considering enacting similar cross-border data transfer restrictions and laws requiring local data residency, which could increase the cost and complexity of delivering our services and operating our business.

As such, if we are unable to implement a valid solution to transfer personal data from the EEA, the UK or other jurisdictions to the United States, or if the requirements for a legally-compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, increased exposure to regulatory actions, substantial fines and penalties, injunctions against our processing or transferring of personal data necessary to operate our business, the need to relocate part of or all of our business or data processing activities to other jurisdictions (such as Europe) at significant expense, and limit our ability to collaborate with partners as well as other service providers, contractors and other companies subject to European data protection laws.

Restrictions on our ability to import personal data from Europe could therefore impact our clinical trial activities in Europe and limit our

ability to collaborate with CROs and other third parties subject to European data protection laws.

Additionally, other countries outside of Europe have enacted or are considering enacting similarly stringent data localization and cross-border data transfer restrictions and laws, which could increase the cost and complexity of delivering our services and operating our business.

The type of challenges we face in Europe will likely also arise in other jurisdictions that adopt laws similar in construction to the GDPR or regulatory frameworks of equivalent complexity.

Additionally, the U.S.

Department of Justice issued a rule entitled Preventing Access to U.S.

Sensitive Personal Data and Government-Related Data by Countries of Concern or Covered Persons, which places additional restrictions on certain data transactions involving countries of concern (e.g., China, Russia, Iran) and covered individuals (i.e., individuals and entities located in or controlled by individuals or entities located in those jurisdictions) that may impact certain business activities such as vendor engagements, employment of certain individuals and investor agreements.

Violations of the rule could lead to significant civil and criminal fines and penalties.

The rule applies regardless of whether data is anonymized, key-coded, pseudonymized, de-identified or encrypted.

In addition to data privacy and security laws, we are contractually subject to industry standards adopted by industry groups, and we are and may become in the future, subject to such obligations.

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additional reporting requirements and/or oversight;

bans on processing personal data;

bans or restrictions on processing personal data;

orders to destroy or not use personal data;

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or substantial changes to our business model or operations.

We use AI/ML to assist us in making certain decisions, which is regulated by certain privacy laws.

Due to inaccuracies or flaws in the inputs, outputs, or logic of the AI/ML, the model could be biased and could lead us to make decisions that could bias certain individuals (or classes of individuals), and adversely impact their rights, employment, and ability to obtain certain pricing, products, services, or benefits.

The development and use of AI/ML present various privacy and security risks that may impact our business.

AI/ML are subject to privacy and data security laws, as well as increasing regulation and scrutiny.

Our employees and personnel use AI technologies to perform their work, and the disclosure and use of personal data in generative AI technologies is subject to various privacy laws and other privacy obligations.

Governments have passed and are likely to pass additional laws regulating generative AI.

We use generative AI to assist us in making certain decisions, which is regulated by certain privacy laws.

Due to inaccuracies or flaws in the inputs, outputs, or logic of the AI technologies, the model could be biased and could lead us to make decisions that could bias certain individuals (or classes of individuals), and adversely impact their rights, employment, and ability to obtain certain pricing, products, services, or benefits.

The development and use of AI technologies present various privacy and security risks that may impact our business.

AI technologies are subject to privacy and data security laws, as well as increasing regulation and scrutiny.

Our employees and personnel may use AI technologies to perform their work, and the disclosure and use of personal data in generative AI technologies is subject to various privacy laws and other privacy obligations.

Governments have passed

and are likely to pass additional laws and regulations which regulate generative AI.

Our use of this technology could result in additional compliance costs, regulatory investigations and actions, and lawsuits.

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These laws and regulations restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs, and other business arrangements.

Such misconduct also could involve the improper use of information obtained in the course of clinical trials or interactions

with the FDA or other regulatory authorities, which could result in regulatory sanctions and cause serious harm to our reputation.

Such misconduct also could involve the improper use of information obtained in the course of clinical trials or interactions with the FDA or other regulatory authorities, which could result in regulatory sanctions and cause serious harm to our reputation.

It is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from government investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations.

If any such actions are instituted against us and we are not successful in defending ourselves or asserting our rights, those actions could result in significant civil, criminal, and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion from participating in government-funded healthcare programs, such as Medicare and Medicaid, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, contractual damages, reputational harm, and the curtailment or restructuring of our operations, any of which could have a negative impact on our business, financial condition, results of operations, and prospects.

Disruptions at the FDA may slow the time necessary for new products to be reviewed and/or approved, which would adversely affect our business.

In addition, t here is substantial uncertainty regarding the new Administration’s initiatives and how these might impact the FDA, its implementation of laws, regulations, policies and guidance and its personnel.

Similar initiatives may also be directed toward other government agencies.

These initiatives could prevent, limit or delay development and regulatory approval of our product candidates, which would adversely affect our business.

Disruptions at the FDA, the SEC and other government agencies and regulatory authorities caused by funding shortages or global health concerns could hinder their ability to hire and retain key leadership and other personnel, prevent new products and services from being developed or commercialized in a timely manner or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business .

The ability of the FDA and comparable foreign regulatory authorities to review and approve new products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes.

Average review times at the agency have fluctuated in recent years as a result.

In addition, government funding of the SEC, and other government agencies on which our operations may rely, including those that fund research and development activities, is subject to the political process, which is inherently fluid and unpredictable.

Disruptions at the FDA may slow the time necessary for new products to be reviewed and/or approved, which would adversely affect our business.

For example, over the last several years, including most recently in October 2025, the U.S.

government has shut down several times and certain regulatory agencies, such as the FDA and the SEC, have had to furlough critical FDA, SEC and other government employees and stop critical activities.

If a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

The ability of the FDA and other government agencies to properly administer their functions is highly dependent on the levels of government funding and the ability to fill key leadership appointments, among various factors.

Changes in FDA staffing could result in delays in the FDA’s responsiveness or in its ability to review submissions or applications, issue regulations or guidance, or implement or enforce regulatory requirements in a timely fashion or at all.

If any legislation, executive orders, or lapses in agency funding impose constraints on the FDA’s ability to engage in oversight and implementation activities in the normal course, our business may be negatively impacted.

If any legislation, executive orders, or lapses in agency funding impose constraints on the FDA’s ability to engage in oversight and

implementation activities in the normal course, our business may be negatively impacted.

In addition, government funding of other government agencies that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable.

Similar consequences would also result in the event of another significant shutdown of the federal government.

For example, in 2024, the U.S.

government was on the verge of a shutdown and has previously shut down several times, and certain regulatory agencies, such as the FDA, had to furlough critical employees and stop critical activities.

If a prolonged government shutdown occurs, or if geopolitical or global health concerns prevent the FDA from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Further, future government shutdowns or delays could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.

Our current or future acquisitions or strategic collaborations could increase our capital requirements, dilute our shareholders, cause us to incur debt, or assume contingent liabilities and subject us to other risks.

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The market price of our common shares has been and may continue to be highly volatile and could be subject to wide fluctuations in price in response to various factors, many of which are beyond our control.

Since our initial public offering which occurred in May 2019, through March 13, 2025, the price of our common shares has ranged from $1.12 per share to $27.15 per share.

From January 1, 2025 through March 20, 2026, the price of our common shares has ranged from $0.65 per share to $2.95 per share.

The stock market in general and the market for biopharmaceutical and pharmaceutical companies in particular, has experienced extreme volatility that has often been unrelated to the operating performance of particular companies.

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In addition to the factors discussed in this “Risk Factors” section and elsewhere in this Annual Report on Form 10-K, the market price for our common shares may be influenced by the following:

our ability to meet external revenue and profitability expectations for CARDAMYST TM for the treatment of PSVT;

the commencement, enrollment, or results of our planned or future clinical trials of etripamil and any future product candidates or those of our competitors;

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market conditions in the pharmaceutical and biotechnology sectors;

general economic, political, and market conditions, including deteriorating market conditions due to investor concerns regarding inflation and Russian hostilities in Ukraine, the Israel-Hamas war, changes in trade and tariff policies, and overall fluctuations in the financial markets in the United States and abroad;

general economic, political, and market conditions, including deteriorating market conditions due to investor concerns regarding inflation and global geopolitical conflicts, changes in trade and tariff policies, and overall fluctuations in the financial markets in the United States and abroad;

investors’ general perception of us and our business.

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We also may decide to settle lawsuits on unfavorable terms.

Any such negative outcome could result in payments of substantial damages or fines, damage to our reputation or adverse changes to our business practices.

Any such negative outcome could result in payments of

substantial damages or fines, damage to our reputation, or adverse changes to our business practices.

Defending against litigation is costly and time-consuming, and could divert our management’s attention and our resources.

Furthermore, during the course of litigation, there could be negative public announcements of the results of hearings, motions, or other interim proceedings or developments, which could have a negative effect on the market price of our common shares.

Unstable market and economic conditions, including as a result of recent bank closures, public health crises or geopolitical tensions such as the Russia-Ukraine and/or the Israel-Hamas war, may have serious adverse consequences on our business, financial condition and share price.

We have a substantial number of outstanding warrants.

The exercise of our outstanding warrants will dilute existing stockholders and could adversely affect the trading price of our common stock.

While the holders of our outstanding pre-funded warrants and warrants are subject to beneficial ownership limitations, as of December 31, 2025, we had (i) outstanding pre-funded warrants to purchase, without regard to any beneficial ownership limitations, up to 16,412,925 shares of our common stock at an exercise price of $0.001 per share and (ii) outstanding warrants to purchase, without regard to any beneficial ownership limitations, up to 55,707,997 shares of common stock at a weighted average exercise price of $1.73 per share.

The exercise of our outstanding warrants could result in significant dilution to existing stockholders, cause the trading price of our common stock to decline and impair our ability to raise capital through the sale of additional equity securities.

Moreover, the expectation of such exercises could encourage the short selling of our common stock, which could place further downward pressure on the trading price of our common stock.

Unstable market and economic conditions, including as a result of recent bank closures, public health crises or geopolitical tensions may have serious adverse consequences on our business, financial condition, and share price.

The global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in inflation rates, and uncertainty about economic stability.

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Our general business strategy may be materially or adversely impacted if these unpredictable and unstable market conditions continue.

Additionally, the Russia-Ukraine and the Israel-Hamas wars have created extreme volatility in the global capital markets and are expected to have further global economic consequences, including potential disruptions of the global supply chain, manufacturing and energy markets.

Our general business strategy may be materially or adversely impacted if these unpredictable and unstable market conditions continue.

Additionally, the global geopolitical conflicts have created extreme volatility in the global capital markets and are expected to have further global economic consequences, including potential disruptions of the global supply chain, manufacturing, and energy markets.

Additionally, the introduction of or changes in tariffs or trade barriers, such as the enactment of tariffs on goods imported into the United States, could also increase our expenses.

such volatility and disruptions may have adverse consequences on us or the third parties on whom we rely.

For example, in February 2026, the United States Supreme Court (SCOTUS) invalidated certain tariffs imposed by the U.S.

government under emergency statutory authority in 2025.

Shortly thereafter, President Trump signed an executive order implementing a new 10% global tariff pursuant to an alternative statutory authority, which may be raised up to 15%.

It remains unclear whether and to what extent duties previously collected under the invalidated tariffs will be refunded, whether refunds will be subject to administrative or judicial processes, or whether offsets or alternative measures may be imposed.

This evolving legal and policy landscape has contributed to continued volatility in the trade environment.

Any such volatility and disruptions may have adverse consequences on us or the third parties on whom we rely.

If the equity and credit markets deteriorate, including as a result of inflation expectations, recent bank closures, the changing interest rate environment, political unrest or war, it may make any necessary debt or equity financing more difficult to obtain in a timely manner or on favorable terms, more costly or more dilutive.

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The price of our shares could decline if one or more equity research analysts downgrade our shares or issue other unfavorable commentary or research about us.

If one or more equity research analysts ceases coverage of us or fails to publish reports on us regularly, demand for our shares could decrease, which in turn could cause the trading price or trading volume of our common shares to decline.

If one or more equity research analysts cease coverage of us or fails to publish reports on us regularly, demand for our shares could decrease, which in turn could cause the trading price or trading volume of our common shares to decline.

Because we do not anticipate paying any cash dividends on our share capital in the foreseeable future, capital appreciation, if any, will be your sole source of gain.

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Treasury Regulations.

Holder is directly, indirectly, or constructively owns at least 10% of our common shares, such holder may be subject to adverse U.S.

federal income tax consequences.

Holder is treated as owning (directly, indirectly or constructively) at least 10% of the value or voting power of our common shares, such U.S.

Holder may be treated as a “United States shareholder” with respect to each “controlled foreign corporation” in our group (if any).

Because our group includes at least one U.S.

subsidiary (Milestone Pharmaceuticals USA Inc.), if we were to form or acquire any non-U.S.

subsidiaries in the future, they may be treated as controlled foreign corporations.

A United States shareholder of a controlled foreign corporation may be required to annually report and include in its U.S.

taxable income its pro rata share of “Subpart F income,” “global intangible low-taxed income” and investments in U.S.

property by that controlled foreign corporation, regardless of whether that controlled foreign corporation, or we, make any distributions.

An individual that is a United States shareholder with respect to a controlled foreign corporation generally would not be allowed certain tax deductions or foreign tax credits that would be allowed to a United States shareholder that is a U.S.

We cannot provide any assurances that we will assist investors in determining whether any non-U.S.

subsidiaries that we may form or acquire in the future will be treated as

controlled foreign corporations or whether any such investor would be treated as a United States shareholder with respect to any of such controlled foreign corporations.

Further, we cannot provide any assurances that we will furnish to any investor information that may be necessary to comply with the reporting and tax paying obligations discussed above.

Failure to comply with these reporting obligations may subject a U.S.

Holder to significant monetary penalties and may extend the statute of limitations with respect to its U.S.

federal income tax return for the year for which reporting was due.

Holders should consult their tax advisors regarding the potential application of these rules to their investment in our common shares.

Future changes to tax laws could materially adversely affect our Company and reduce net returns to our shareholders.

Our tax treatment is subject to the enactment of, or changes in, tax laws, regulations and treaties, or the interpretation thereof, tax policy initiatives and reforms under consideration and the practices of tax authorities in jurisdictions in which we operate, including those related to the Organization for Economic Co-Operation and Development’s, or “OECD,” Base Erosion and Profit Shifting, or “BEPS,” Project, the European Commission’s state aid investigations and other initiatives.

Our tax treatment is subject to the enactment of, or changes in, tax laws, regulations, and treaties, or the interpretation thereof, tax policy initiatives and reforms under consideration and the practices of tax authorities in jurisdictions in which we operate, including those related to the Organization for Economic Co-Operation and Development, or “OECD,” the Base Erosion and Profit Shifting, or “BEPS,” Project, the European Commission’s state aid investigations, and other initiatives.

Such changes may include (but are not limited to) the taxation of operating income, investment income, dividends received, or (in the specific context of withholding tax) dividends paid.

We are unable to predict what tax reform may be proposed or enacted in the future or what effect such changes would have on our business, but such changes, to the extent they are brought into tax legislation, regulations, policies, or practices, could affect our financial position and overall or effective tax rates in the future in countries where we have operations, reduce post-tax returns to our shareholders, and increase the complexity, burden, and cost of tax compliance.

For example, the Tax Act enacted many significant changes to the U.S.

Future guidance from the Internal Revenue Service, or the “IRS,” and other tax authorities with respect to the Tax Act may affect us, and certain aspects of the Tax Act could be repealed or modified in future legislation.

In addition, it is uncertain if and to what extent various states will conform to federal tax legislation.

Changes in corporate tax rates, the realization of net deferred tax assets relating to our operations, the taxation of foreign earnings, and the deductibility of expenses under the Tax Act or future reform legislation could have a material impact on the value of our deferred tax assets, could result in significant one-time charges, and could increase our future U.S.

We urge you to consult with your legal and tax advisors with respect to this legislation and the potential tax consequences of investing in or holding our common shares.

For example, legislation commonly referred to as the OBBBA, enacted in 2025, the Inflation Reduction Act enacted in 2022, the Coronavirus Aid, Relief, and Economic Security Act enacted in 2020, and the Tax Cuts and Jobs Act enacted in 2017 made many significant changes to the U.S.

Internal Revenue Code of 1986, as amended, or the “Code.” The Tax Cuts and Jobs Act required taxpayers to capitalize and amortize U.S.-based and non-U.S.-based research and experimental, or “R&E,” expenditures over five and fifteen years, respectively.

The OBBBA restored the deductibility of domestic R&E expenditures in the year incurred for tax years beginning after December 31, 2024, but retained the capitalization and amortization requirement for foreign R&E expenditures.

Future guidance from the Internal Revenue Service and other tax authorities with respect to any legislation may affect us, and certain aspects of such legislation could be repealed or modified in future legislation or sunset in future years.

It is possible that changes in or interpretations under the OBBBA, the Tax Cuts and Jobs Act, or other tax legislation, or the enactment of new tax legislation, could increase our future tax liability, which could in turn adversely impact our business and future profitability.

We continue to evaluate the impact that these and other tax reforms may have on our business.

The impact of these and other tax reforms is uncertain and one or more of these or similar measures could seriously harm our business.

We urge you to consult with your legal and tax advisors with respect to these tax reforms and the potential tax consequences of investing in or holding our common shares.

Tax authorities may disagree with our positions and conclusions regarding certain tax positions, resulting in unanticipated costs, taxes, or non-realization of expected benefits.

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or a public float of less than $700 million.

As a smaller reporting company, we are permitted to comply with scaled-back disclosure obligations in our SEC filings compared to other issuers, including with respect to disclosure obligations regarding executive compensation in our

periodic reports and proxy statements.

We have elected to adopt the accommodations available to smaller reporting companies.

We have elected to adopt the accommodations available to smaller reporting

Until we cease to be a smaller reporting company, the scaled-back disclosure in our SEC filings will result in less information about our company being available than for other public companies.

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Canadian courts may refuse to hear a claim based on an alleged violation of U.S.

securities laws against us or these persons on the grounds that Canada is not the most appropriate forum in which to bring such a claim.

securities laws against us or these persons on the grounds

that Canada is not the most appropriate forum in which to bring such a claim.

Even if a Canadian court agrees to hear a claim, it may determine that Canadian law and not U.S.

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

What changed 10-K

Item 1A. Risk Factors