What changed in this filing

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Item 1A. Risk Factors

2025-04-15 compared with 2024-03-29 · 65 added, 35 removed, 293 unchanged (25% of the section changed)

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Our losses have had, and are expected to continue to have, an adverse impact on our working capital, total assets, and stockholders' equity.

Because of the risks and uncertainties associated with product acceptance, we are unable to predict the extent of any future losses, whether we will ever generate significant revenues or if we will ever achieve or sustain profitability.

Even if we do generate profits from operations, we may not be able to sustain or increase profitability on a quarterly or annual basis.

Our failure to generate profits from operations, and to become and remain profitable, could impair our ability to raise capital, expand our business, and maintain our commercial efforts or continue our operations.

Because of the risks and uncertainties associated with product acceptance and sales expansion, we are unable to predict the extent of any future losses, whether we will ever generate significant revenues or if we will ever achieve or sustain profitability.

Even if we do generate profits from operations, we may not be able to achieve, sustain or increase profitability on a quarterly or annual basis.

Our failure to generate substantive profits from operations and to become and remain profitable could impair our ability to raise capital, expand our business, and maintain our commercial efforts or continue our operations.

A decline in the value of our company could also cause our shareholders to lose all or part of their investment.

We anticipate that we will need additional funding for our operations and may be unable to raise capital when needed, which may force us to delay, curtail or eliminate parts of the commercialization efforts of our CompuFlo Epidural Computer Controlled Anesthesia System.

We anticipate that we will need additional funding for our operations and may be unable to raise capital when needed, which may force us to delay, curtail or eliminate parts of the Company ’ s operations.

Our operations have consumed substantial amounts of cash since inception.

During the years ended December 31, 2024 and 2023, net cash flow used in operations was approximately $2.9 million and approximately $5.3 million, respectively.

We expect to continue to spend substantial amounts on commercialization and marketing activities, including the continued commercialization and marketing of our FDA-approved CompuFlo Epidural Computer Controlled Anesthesia System.

Until such time, if ever, as we can generate enough product revenue and achieve positive cash flow, we expect to seek to finance future cash needs through equity financings or corporate collaboration and licensing arrangements and may seek the sale of non-medical assets.

Sales of a substantial number of shares of our common stock, or the perception that such sales may occur, may adversely impact the price of our common stock.

Almost all our 75,881,840 outstanding shares of common stock on December 31, 2023, as well as a substantial number of shares of our common stock underlying outstanding warrants, are available for sale in the public market, either freely or pursuant to Rule 144 under the Securities Act of 1933, as amended.

Sales of a substantial number of shares of our common stock, or the perception that such sales may occur, may adversely impact the price of our common stock.

We believe that our immediate future viability is dependent on our ability to raise additional capital to finance our operations through public or private equity offerings, collaborations and licensing arrangements or other sources.

Although management plans to pursue additional funding, there is no assurance that we will be successful in obtaining sufficient funding on terms acceptable to us to fund continuing operations, or at all.

If we are unable to raise this capital when needed, we may be forced to delay, or eliminate our research and development programs or other operations.

Sales of a substantial number of shares of our common stock, or the perception that such sales may occur, may adversely impact on the price of our common stock.

Almost all our 78,047,798 outstanding shares of common stock on December 31, 2024, are available for sale in the public market, either freely or pursuant to Rule 144 under the Securities Act of 1933, as amended.

Sales of a substantial number of shares of our common stock, or the perception that such sales may occur, may adversely impact on the price of our common stock.

Raising additional capital by issuing securities or through licensing or lending arrangements may cause dilution to our existing stockholders, restrict our operations, or require us to relinquish proprietary rights.

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In addition, if we raise additional funds through licensing arrangements or the disposition of any of our assets, it may be necessary to relinquish potentially valuable rights to our product candidates or grant licenses on terms that are not favorable to us.

Recent developments in financial institutions could adversely affect our current and projected business operations, financial condition and results of operations.

Recent events involving limited liquidity, defaults, non-performance and other adverse developments that affect financial institutions have led to market-wide liquidity concerns.

For example, on March 10, 2023, Silicon Valley Bank was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation, or FDIC, as receiver.

On March 12, 2023, Signature Bank and Silvergate Capital Corp.

were also placed into receivership.

Future increases of the borrowing rate by the Federal Reserve Board, to slow inflation or for other reasons, may expose other financial institutions to greater interest rate risk and exacerbate liquidity and other adverse developments affecting such institutions.

Changes in financial institutions could adversely affect our current and projected business operations, financial condition and results of operations.

The Company currently keeps more than $250,000, the maximum amount insured by the Federal Deposit Insurance Corporation (“FDIC”), in its current bank depositary.

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Milestone Scientific believes that a significant portion of its sales will continue to be from its E-Commerce platform launched in January 2023, for the foreseeable future.

Currently, sales of the STA Single Tooth Anesthesia Systems® (STA) and handpieces in the United States are reliant on E-Commerce sales.

We have exposure to risks of operating in an E-commerce platform:

Refunds and customer disputes due to issues like wrong product delivery or defective items can impact your business.

Refunds and customer disputes due to issues like wrong product delivery or defective items can impact on our business;

Online security breaches and cyberattacks;

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Unexpected changes in political or regulatory environments.

If Milestone Scientific is unable to maintain or expand its E-Commerce platform its sales may be negatively affected.

If Milestone Scientific is unable to maintain or expand its E-Commerce platform its sales will be negatively affected.

We are exposed to the risks inherent in international sales.

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political and economic instability;

import and export restrictions and other trade barriers;

import and export control restrictions and other trade barriers such as tariffs;

difficulties in obtaining approval for significant transactions.

If physicians do not accept nor use our CompuFlo Epidural System, our ability to generate revenue from sales will be materially impaired.

Although the FDA has cleared our application to begin marketing the CompuFlo Epidural System, this is no assurance that physicians, hospitals, clinics, and other health care providers will accept and use it.

If physicians neither accept nor use our CompuFlo Epidural System, our ability to generate revenue from sales will be materially impaired.

There is no assurance that physicians, hospitals, clinics, and other health care providers will accept and use the CompuFlo Epidural System.

Acceptance and use of the CompuFlo Epidural System will depend on many factors including:

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These actions could have a negative effect on our financial results.

The existence of direct and indirect price controls and pressures on our products could materially adversely affect our financial prospects and performance.

The existence of direct and indirect price controls and pressures on our products could seriously affect our financial prospects and performance.

We could lose our market advantage earlier than expected.

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We may not be able to attract and retain qualified employees.

Our future success depends upon the continued service of our executive officer and other key management and technical personnel, and on our ability to continue to identify, attract, retain, and motivate them.

Our future success depends upon the services of a executive officer.

The Company is currently looking for a new chief executive officer to replace Mr.

Haverhals, who retired at the end of 2024.

Currently one of our directors, Mr.

Goldman, is the Interim Chief Executive Officer.

We also rely on other key management and technical personnel, and on our ability to continue to identify, attract, retain, and motivate them.

Implementing our business strategy requires specialized territory managers and other talent, as our revenues are highly dependent on technological and product innovations.

The market for employees in our industry is extremely competitive, several such competitors are significantly larger than us and can offer compensation more than what we are able to offer.

If we are unable to attract and retain qualified employees, our business may be harmed.

If we are unable to attract and retain a new chief executive officer and other qualified employees, as needed, our business may be harmed.

Risk Related to Our Dependence on Third Parties

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China’s political and economic systems are very different from most developed countries in many respects, including, the amount of government involvement, the level of development, the control of foreign exchange and the allocation of resources.

The increase in United States tariffs on products from China will impact the price of our goods sold.

Uncertainties may arise with changing governmental policies and measures.

China also faces many social, economic, and political challenges that may produce instabilities in both its domestic arena and in its relationship with other countries.

These instabilities may significantly and adversely affect our supply of dental handpieces which would in turn adversely affect our financial performance.

These instabilities may significantly and adversely affect our supply of dental handpieces and our ability to delivery reasonably priced products, which would in turn adversely affect our financial performance.

In addition, as the Chinese legal system develops, there can be no assurance that changes in laws and regulations and their interpretation or their enforcement will not have a material adverse effect on our business relationship with the sole manufacturer of our dental handpieces.

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Failure by us to comply with these standards could have an adverse effect on our business, financial condition, or results of operations.

The FDA regulates the approval, manufacturing and sales and marketing of many of our products in the United States.

The FDA regulates the product approvals manufacturing, and sales and marketing of many of our products in the United States.

Significant government regulations also exist in other countries in which we conduct business.

As a device manufacturer, we are required to register with the FDA and are subject to periodic inspection by the FDA for compliance with the FDA’s Quality System Regulation requirements, which require manufacturers of medical devices to adhere to certain regulations, including testing, quality control and documentation procedures.

In addition, the federal Medical Device Reporting regulations require us to provide information to the FDA whenever there is evidence that reasonably suggests that a device may have caused or contributed to a death or serious injury or, if a malfunction were to occur, could cause or contribute to a death or serious injury.

Compliance with applicable regulatory requirements is subject to continual review and is rigorously monitored through periodic inspections by the FDA.

In the European community, we are required to maintain certain ISO certifications to sell our products and must undergo periodic inspections by notified bodies to obtain and maintain these certifications.

In the European community, we are required to maintain compliance to ISO, CE marking standards to sell our products and must undergo periodic inspections by notified bodies to obtain and maintain compliance.

Failure to comply with current governmental regulations and quality assurance guidelines could lead to temporary manufacturing shutdowns, product recalls or related field actions, product shortages or delays in product manufacturing.

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Our operations are and will continue to be directly, or indirectly through our distributors, customers, and health care professionals, subject to various U.S.

federal and state fraud and abuse laws, including, without limitation, the federal Anti-Kickback Statute, federal False Claims Act, and the Foreign Corrupt Practice Act of 1977 (“FCPA”).

federal and state fraud and abuse laws, including, without limitation, the federal Anti-Kickback Statute, federal False Claims Act, and the Foreign Corrupt Practice Act of 1977.

These laws may impact, among other things, our proposed sales, and marketing and education programs.

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Safeguards we implement to discourage improper payments or offers of payments by our employees, consultants, sales agents, or distributors may be ineffective, and violations of the FCPA and similar laws may result in severe criminal or civil sanctions, or other liabilities or proceedings against us, any of which would likely harm our reputation, business, results of operations and financial condition.

Changes in United States policy regarding international trade, including import and export regulation and international trade agreements, could also negatively impact Milestone Scientific’s business.

The United States has imposed tariffs and export controls on certain goods and products imported from China and certain other countries, which has resulted in retaliatory tariffs by China and other countries.

Additional tariffs imposed by the United States on a broader range of imports, or further retaliatory trade measures taken by China or other countries in response, could result in an increase in supply chain costs that Milestone Scientific may not be able to offset or that otherwise adversely impact its results of operations.

In addition, political tensions between the United States and China have escalated in recent years.

Rising political tensions could reduce trade, investment and other economic activities between the two major economies.

Any of these factors could have a material adverse effect on Milestone Scientific’s business, prospects, financial condition, and results of operations.

Certain modifications to Milestone Scientific ’ s products may require new 510(k) clearances or other marketing authorizations and may require Milestone Scientific to recall or cease marketing its products.

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If the FDA disagrees with Milestone Scientific’s determinations and requires it to submit new 510(k) notifications, Milestone Scientific may be required to cease marketing or to recall the modified product until it obtains clearance, and it may be subject to significant regulatory fines or penalties.

Changes to United States federal and state regulatory agencies may cause disruptions and delays in approval of the government approval processes and regulation relating to our products.

It is possible that the Trump administration could institute significant changes to certain regulatory agencies and seek to institute the "Department of Government Efficiency," or "DOGE," tasked with making changes to eliminate regulations, cut expenditures, and restructure federal agencies, some of which could impact public companies.

For example, the incoming administration has discussed several changes to the reach and oversight of the Food and Drug Administration, which could affect its relationship with the pharmaceutical industry, transparency in decision making and ultimately the cost and availability of prescription drugs, as well as oversight over clinical trials and pharmaceutical development, all of which could pose risks (or opportunities) for companies in related industries.

Similarly, there have been discussions of "reigning in" regulatory agencies such as the Federal Trade Commission, the Federal Communications Commission and the Federal Energy Regulatory Commission, all of which could impact how companies do business and could pose risks related to business operations and financial outlook.

Milestone Scientific may be subject to enforcement actions if it engages in improper marketing or promotion of its products.

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Any new laws or regulations governing our operations could have an adverse impact on our business, results of operations and prospects.

Changes to trade policy, including tariff and import/export regulations, may have a material adverse effect on our results of operations, cash flows and financial condition.

Changes in United States policy regarding international trade, including import and export regulation and international trade agreements, could adversely affect our business.

government has instituted and proposed further changes in trade policies that include the imposition of higher tariffs on imports into the U.S., the negotiation or termination of trade agreements, economic sanctions on individuals, corporations or countries, and other government regulations affecting trade between the U.S.

and other countries where we conduct our business.

It may be time-consuming and expensive for us to alter our operations in order to adapt to or comply with any such changes.

Tariffs and other changes in U.S.

trade policy have triggered retaliatory actions by the affected countries, and certain foreign governments, including China, have instituted or are considering imposing retaliatory measures on certain U.S.

We do a significant amount of business that will be impacted by changes to the trade policies of the U.S.

and foreign countries (including governmental action related to tariffs, international trade agreements, or economic sanctions).

Tariffs and other retaliatory measures imposed by the United States on imports, and other retaliatory trade measures taken by the United States, China and other countries, and successive rounds of retaliatory trade measures as part of a trade war or otherwise, will result in an increase in supply chain costs and limit availability of products that Milestone Scientific may not be able to offset or that otherwise adversely impact its operations.

Such changes have the potential to adversely impact the U.S.

economy or certain sectors thereof, our industry and the global demand for our products, and as a result, could have a material adverse effect on our results of operations, cash flows and financial condition.

In addition, political tensions between the United States and China have escalated in recent years.

Rising political tensions could reduce trade, investment and other economic activities between the two major economies.

Any of these factors could have a material adverse effect on Milestone Scientific’s business, prospects, financial condition, and results of operations.

Turnover at U.S.

Department of Health and Human Services, including the FDA, is expected to lead to different enforcement objectives.

In addition, on June 28, 2024, the U.S.

Supreme Court ruled on Loper Bright Enterprises v.

Raimondo, thereby overturning the Chevron Doctrine, a Supreme Court ruling from 1984 that provided for deference to U.S.

regulatory agency regulations adopted pursuant to general federal statutory authority.

This decision and other related decisions may create new legal avenues to challenge federal regulations, which may create unforeseen uncertainty, especially for businesses that have relied on a settled regulatory environment in their industry.

Our historical reliance on an established regulatory environment may be subject to the potential risks of challenges to agency rules that regulate our industry.

International conflict has affected commerce worldwide, and may have a material adverse effect on our results of operations, cash flows and financial condition.

The Ukraine/Russia conflict and various Middle East conflicts have received significant media coverage.

Geopolitical instability can lead to significant disruption in supply chain efficiency, adding cost and delays.

Russia-related sanctions have been instituted by the Office of Foreign Assets Control (OFAC) are likely to have unpredictable and wide-ranging effects on the domestic and global economy and financial markets, which could have an adverse effect on our business and results of operations.

As a direct impact from the conflict, we have experienced a decrease in international sales to Ukraine and halted all sales to Russia.

We will continue to monitor the situation carefully and, if necessary, take action to protect our business, operations, and financial condition.

Risks Related to Milestone Scientific Common Stock

Milestone Scientific is effectively controlled by a limited number of stockholders.

Milestone Scientific Scientific’s principal stockholders, Leonard Osser and Gian Domenico Trombetta control approximately 20% of the issued and outstanding shares of common stock.

Milestone Scientific Scientific’s principal stockholders, Leonard Osser and BP4, Srl, control approximately 20% of the issued and outstanding shares of common stock.

As a result, they can exercise substantial control over our affairs and corporate actions requiring stockholder approval, including electing directors, selling all or substantially all our assets, merging with another entity, or amending our certificate of incorporation.

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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