Item 1A. Risk Factors
Item 1A. Risk Factors
There have been no material changes to our risk factors disclosed in Part I, Item 1A “Risk Factors” to the 2019 10-K, except as supplemented and updated as follows. Also note that references in the 2019 10-K to NovoTTF-100L now refer to Optune Lua.
The COVID-19 pandemic could materially adversely impact our business, including our clinical trials.
As the COVID-19 pandemic continues to spread around the globe, we have experienced and will likely continue to experience disruptions that could severely impact our business and clinical trials, which could include:
• delays or difficulties in onboarding active patients and enrolling patients in our clinical trials;
• delays or difficulties in clinical site initiation, including difficulties in recruiting clinical site investigators and clinical site staff;
• declines in prescriptions written due to a perception that our Products are difficult to administer remotely or if patients are unwilling to travel to treatment sites or receive in-home treatment assistance from us or other caregivers;
• reductions in third-party reimbursements, which could materially affect our revenue, as most of our patients rely on third-party payors to cover the cost of our Products and a material number of our patients could lose access to their private health insurance plan if they or someone in their family lose their job;
• diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as our clinical trial sites and hospital staff supporting the conduct of our clinical trials;
• interruption of key clinical trial activities, such as clinical trial site monitoring, due to limitations on travel imposed or recommended by federal or state governments, employers and others;
• delays in receiving approval from local regulatory authorities to initiate our planned clinical trials;
• delays in clinical sites receiving the supplies and materials needed to conduct our clinical trials;
• interruption in global shipping that may affect the transport of active patient and clinical trial materials;
• changes in local regulations as part of a response to the COVID-19 coronavirus outbreak which may require us to change the ways in which our clinical trials are conducted, which may result in unexpected costs, or to discontinue the clinical trials altogether;
• delays in necessary interactions with local regulators, ethics committees and other important agencies and contractors due to limitations in employee resources or forced furlough of government employees;
• disruption of our supply chain, as our suppliers and common carriers are unable to meet our requirements to provide us the materials we need for clinical trial and active patient care needs;
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• indirect consequences of the pandemic on the global economy in general, such as an increase in bankruptcies of our key suppliers, and the inability of our third-party payors to meet their obligations reimburse us in a timely fashion or at all;
• postponements and cancellations of key conferences and meetings and travel restrictions could interfere with our ability to interact with key thought leaders in the field, leading to a disruption in the rate of adoption of our technology;
• increases in expenditures on technology and other tools necessary to provide patient care in an environment where both patient and care-giver travel is restricted and access to in-person interaction is limited; and
• refusal of the FDA to accept data from clinical trials in affected geographies outside the United States.
The global outbreak of the COVID-19 coronavirus continues to rapidly evolve. The extent to which the COVID-19 coronavirus may impact our business and clinical trials will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the ultimate geographic spread of the disease, the duration of the outbreak, travel restrictions and social distancing guidelines in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease. The COVID-19 pandemic may also have the effect of heightening many of the other risks described in our 2019 10-K.
Safety issues concerning lithium-ion batteries could have a material adverse impact on our business.
Our Products use lithium ion batteries. On rare occasions, lithium-ion cells can rapidly release the energy they contain by venting smoke, heat, and flames in a manner that can ignite nearby materials as well as other lithium-ion cells. A failure in the lithium ion battery contained in a Product could occur, which could result in accidents, casualty or damages, and subject us to lawsuits, product recalls, or redesign efforts. In addition, we store a significant number of lithium-ion cells at our facilities. Any failure of battery cells or a safety issue or fire related to the cells could disrupt our operations. Such damage or injury could lead to adverse publicity and potentially a safety recall.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.