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Item 1A. Risk Factors

2022-05-31 compared with 2021-12-14 · 95 added, 67 removed, 35 unchanged (82% of the section changed)

You should carefully consider the risks described

below together with all of the other information included in this prospectus before making an investment decision with regard to our securities.

The risks set forth below are not the only risks facing us.

Additional risks and uncertainties may exist that could also adversely affect

our business, prospects or operations.

If any of the following risks actually occurs, our business, financial condition or results of

operations could be harmed.

In that case, the trading price of our common stock could decline, and you may lose all or a significant part

of your investment.

You should carefully consider the key risks

described below together with all of the other information included in this report and our Annual Report on Form 10-K, filed with the

Securities and Exchange Commission on April 28, 2022, before making an investment decision with regard to our securities.

The risks set

forth below and in our Form 10-K are not the only risks facing us.

Additional risks and uncertainties may exist that could also adversely

affect our business, prospects or operations.

If any of the following risks actually occurs, our business, financial condition or results

of operations could be harmed.

In that case, the trading price of our common stock could decline, and you may lose all or a significant

part of your investment.

Because we are an early-stage company with

minimal revenue and a history of losses and we expect to continue to incur substantial losses for the foreseeable future, we cannot assure

you that we can or will be able to operate profitably.

minimal revenue and a history of losses and we expect to continue to incur losses for the foreseeable future, we cannot assure you that

we can or will be able to operate profitably.

We did not generate any revenue prior to the quarter

ended October 31, 2018 and since then, we have incurred losses as, 4P Therapeutics generated only modest revenue from contract research

and development services which are not related to our pharmaceutical transdermal patch business.

Although we anticipate that, for the

near term, we will continue to perform research and development services for third parties, we do not expect to generate significant revenue

from performing contract research and development services for our clients and we have generated losses from operations from this business.

During the year ended January 31, 2021, we experienced a significant decline in revenue from 4P Therapeutics’ largest customer.

We generated negative cash flow from operations for the years ended January 31, 2021 and 2020.

We are subject to the risks common to start-up,

pre-revenue enterprises, including, among other factors, undercapitalization, cash shortages, limitations with respect to personnel, financial

and other resources and lack of revenues.

Drug development companies typically incur substantial losses during the product development

and FDA testing phase of the business and do not generate revenues until after the drug has received FDA approval, which cannot be assured,

and until the company has started to sell the product.

We can give no assurance that we can or will ever be successful in achieving profitability

and the likelihood of our success must be considered in light of our early stage of operations.

We cannot assure you that we will be able

to operate profitably or generate positive cash flow.

If we cannot achieve profitability, we may be forced to cease operations and you

may suffer a total loss of your investment.

ended October 31, 2018 and, since then, we have reported only modest revenue from our pharmaceutical transdermal patch business.

subject to the risks common to start-up, pre-revenue enterprises, including, among other factors, undercapitalization, cash shortages,

limitations with respect to personnel, financial and other resources and lack of revenues.

Drug development companies typically incur

substantial losses during the product development and FDA testing phase of the business and do not generate revenues until after the drug

has received FDA approval, which cannot be assured, and until the company has started to sell the product.

We can give no assurance that

we can or will ever be successful in achieving profitability and the likelihood of our success must be considered in light of our early

stage of operations.

We cannot assure you that we will be able to operate profitably or generate positive cash flow.

If we cannot achieve

profitability, we may be forced to cease operations and you may suffer a total loss of your investment.

Because we do not have a product we can

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to the following, may affect our ability to develop our business and operate profitably:

our ability to obtain necessary funding to develop our proposed products;

the success of clinical trials for our products;

our ability to obtain FDA approval for us to market any proposed product in our pipeline in the United States;

any delays in regulatory review and approval of product in development;

if we obtain FDA approval to market our product, our ability to establish manufacturing and distribution operations or entering into manufacturing and distribution agreements with qualified third parties;

● our ability to obtain necessary

funding to develop our proposed products;

● the success of clinical trials

for our products;

● our ability to obtain FDA approval

for us to market any proposed product in our pipeline in the United States;

● any delays in regulatory review

and approval of product in development;

● if we obtain FDA approval to

market our product, our ability to establish manufacturing and distribution operations or entering into manufacturing and distribution

agreements with qualified third parties;

● market acceptance of our products;

our ability to establish an effective sales and marketing infrastructure;

our ability to protect our intellectual property;

competition from existing products or new products that may emerge;

the ability to commercialize our products;

potential product liability claims and adverse events;

our ability to adequately support future growth;

our ability to attract and retain key personnel to manage our business effectively.

We are dependent on obtaining additional

financing to enable us to pay off debt and to resume our product development operations.

Our continued operations are substantially dependent

on our ability to obtain additional financing to pay off substantial debt incurred in our August 31, 2020 acquisition of Pocono Coated

Products, LLC and to provide us with the ability to resume product development operations and continue to finance our current operations

and generate growth in our revenues.

Our business is impacted by the following additional

● our ability to establish an

effective sales and marketing infrastructure;

● our ability to protect our intellectual

● competition from existing products

or new products that may emerge;

● the ability to commercialize

our products;

● potential product liability

claims and adverse events;

● our ability to adequately support

future growth;

● our ability to attract and retain

key personnel to manage our business effectively.

Our business is impacted by the following

additional key risks :

● Our business could be adversely

14 unchanged sentences

the availability or cost of materials, which could disrupt our supply chain.

The FDA regulatory process may take longer and be more expensive than we anticipate without any assurance that we will obtain FDA approval.

If we are not able to obtain FDA approval for our lead product, we may not have the resources to develop any other product, and we may not be able to continue in business.

We may not be able to launch any products for which we receive FDA marketing approval.

We may not be able to establish a distribution network for the marketing and sale of any products for which we receive FDA approval.

We may not be able to establish manufacturing facilities in compliance with FDA good manufacturing practices or to enter into manufacturing agreements for the manufacture of our products in an FDA approved manufacturing facility.

It may be necessary to us to enter into a joint venture or other strategic relationship in order to develop, perform clinical testing for, manufacture or market any of our proposed products.

We may not be able to enter into such a relationship, and any relationship may not be successful, and the other party may have business interests and priorities that are different from ours.

We are party to a settlement agreement with the SEC resulting from statements in our SEC filings that did not accurately reflect the FDA’s jurisdiction over our consumer products and did not disclose that we could not legally market these products in the United States.

The settlement included a cease-and-desist order against violating the provisions of the Securities Exchange Act which require us to file accurate registration statements and annual reports with the SEC.

Our failure to comply with our obligations under the settlement agreement could result in enforcement proceedings against us or our officers.

We may not be able to protect our rights in our intellectual property, and we may be subject to intellectual property litigation which would be expensive and disruptive of our operations even if we eventually prevail on the merits.

Unanticipated side effects or other adverse events resulting from the use of our product could require a recall of our products and, even if no recall is required, our reputation could be impaired by side effects.

We may not be able to evaluate potential acquisition candidates, with the result that we may not be able to benefit from the acquisition or integrate the acquired business with our business.

We have recently incurred an impairment charge as a result of an acquisition when the intellectual property assets of the acquired company were not as represented.

We cannot assure you that we will not incur similar or other problems with any future acquisitions.

We may fail to comply with all applicable laws and regulations relating to our product.

We may have to change or adapt our operations in the event of changes in national, regional and local government regulations, taxation, controls and political and economic developments that affect our products and the market for our products;

We may be unable to accurately estimate anticipated expenses, capital requirements and needs for additional financing;

● The FDA regulatory process may

take longer and be more expensive than we anticipate without any assurance that we will obtain FDA approval.

● If we are not able to obtain

FDA approval for our lead product, we may not have the resources to develop any other product, and we may not be able to continue in

● We may not be able to launch

any products for which we receive FDA marketing approval.

● We may not be able to establish

a distribution network for the marketing and sale of any products for which we receive FDA approval.

● We may not be able to establish

manufacturing facilities in compliance with FDA good manufacturing practices or to enter into manufacturing agreements for the manufacture

of our products in an FDA approved manufacturing facility.

● It may be necessary to us to

enter into a joint venture or other strategic relationship in order to develop, perform clinical testing for, manufacture or market any

of our proposed products.

We may not be able to enter into such a relationship, and any relationship may not be successful, and the other

party may have business interests and priorities that are different from ours.

● We are party to a settlement

agreement with the SEC resulting from statements in our SEC filings that did not accurately reflect the FDA’s jurisdiction over

our consumer products and did not disclose that we could not legally market these products in the United States.

The settlement included

a cease-and-desist order against violating the provisions of the Securities Exchange Act which require us to file accurate registration

statements and annual reports with the SEC.

Our failure to comply with our obligations under the settlement agreement could result in

enforcement proceedings against us or our officers.

● We may not be able to protect

our rights in our intellectual property, and we may be subject to intellectual property litigation which would be expensive and disruptive

of our operations even if we eventually prevail on the merits.

● Unanticipated side effects or

other adverse events resulting from the use of our product could require a recall of our products and, even if no recall is required,

our reputation could be impaired by side effects.

● We may not be able to evaluate

potential acquisition candidates, with the result that we may not be able to benefit from the acquisition or integrate the acquired business

with our business.

We have recently incurred an impairment charge as a result of an acquisition when the intellectual property assets

of the acquired company were not as represented.

We cannot assure you that we will not incur similar or other problems with any future

acquisitions.

● We may fail to comply with all

applicable laws and regulations relating to our product.

We may have to change or adapt our operations in the event of changes in national,

regional and local government regulations, taxation, controls and political and economic developments that affect our products and the

market for our products;

● We may be unable to accurately

estimate anticipated expenses, capital requirements and needs for additional financing;

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-Q

Item 1A. Risk Factors