What changed in this filing

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Item 1A. Risk Factors

2021-03-31 compared with 2020-03-26 · 1869 added, 1697 removed, 663 unchanged (84% of the section changed)

investment in our securities carries a significant degree of risk.

You should carefully consider the following risks, as well

as the other information contained in this prospectus, including our historical financial statements and related notes included

elsewhere in this prospectus, before you decide to purchase our securities.

Any one of these risks and uncertainties has the potential

to cause material adverse effects on our business, prospects, financial condition and operating results which could cause actual

results to differ materially from any forward-looking statements expressed by us and a significant decrease in the value of our

Common Shares and Warrants.

Refer to “Cautionary Statement Regarding Forward-Looking Statements.”

may not be successful in preventing the material adverse effects that any of the following risks and uncertainties may cause.

These potential risks and uncertainties may not be a complete list of the risks and uncertainties facing us.

There may be additional

risks and uncertainties that we are presently unaware of, or presently consider immaterial, that may become material in the future

and have a material adverse effect on us.

You could lose all or a significant portion of your investment due to any of these risks

and uncertainties.

Related to Our Business, Technology and Industry

are a development-stage company with limited operating history and has incurred losses since our inception.

We anticipate that

we will continue to incur increasing and significant losses for the foreseeable future.

are a development-stage biopharmaceutical company with limited operating history.

We have incurred losses in each year since BiomX’s

inception in 2015.

As of December 31, 2019, our accumulated deficit was $44.6 million, and we expect to incur increasingly significant

losses for the foreseeable future.

You should carefully consider the risks and

uncertainties described below and the other information in this Annual Report before making an investment in our securities.

Our business,

financial condition, results of operations, or prospects could be materially and adversely affected if any of these risks occurs, and

as a result, the market price of our securities could decline and you could lose all or part of your investment.

This Annual also contains

forward-looking statements that involve risks and uncertainties.

See “Cautionary Statement Regarding Forward-Looking Statements.”

Our actual results could differ materially and adversely from those anticipated in these forward-looking statements as a result of certain

factors, including those set forth below.

Risks Related to Our Business, Technology

We are a development clinical-stage company with limited operating

history and have incurred losses since our inception.

We anticipate that our expenses will increase significantly, and we will continue

to incur increasing and significant losses for the foreseeable future.

We are a development clinical-stage biopharmaceutical

company with limited operating history.

We have incurred losses in each year since BiomX Ltd.’s inception in 2015.

December 31, 2020, our accumulated deficit was $72.3 million, and we expect to incur increasingly significant losses for the foreseeable

Preclinical development and clinical trials and activities are costly.

We have devoted, and

will continue to devote for the foreseeable future, substantially all of our resources to research and development and clinical

trials for our product candidates.

We do not expect to generate any revenue from the commercial sales of our product candidates

We have devoted, and will continue to devote for

the foreseeable future, substantially all of our resources to research and development and clinical trials for our product candidates.

We do not expect to generate any revenue from the commercial sales of our product candidates in the near term.

For the years ended

December 31, 2020 and 2019, we had losses from operations of $30.3 million and $22.2 million, respectively.

We anticipate that

our expenses will increase substantially if and as we:

continue to develop and conduct clinical trials

with respect to our lead product candidate, BX001, and other product candidates in our pipeline;

initiate and continue research, preclinical

and clinical development efforts for any future product candidates;

seek to discover and develop additional product

candidates and further expand our clinical product pipeline;

seek marketing and regulatory approvals for

any product candidates that successfully complete clinical trials;

require the manufacture of larger quantities

of product candidates for clinical development and, potentially, commercialization;

maintain, expand and protect our intellectual

property portfolio;

expand our research and development infrastructure,

including hiring and retaining additional personnel, such as clinical, quality control and scientific personnel;

establish sales, marketing, distribution and

other commercial infrastructure in the future to commercialize products for which we obtain marketing approval, if any;

add operational, financial and management information

systems and personnel, including personnel to support our product development and commercialization and help us comply with

our obligations as a subsidiary of a public company.

We will need to raise

additional capital in the future to support our operations.

As of December 31, 2020, we had cash, cash equivalents

and short-term deposits of $57.1 million, and we have had recurring losses from operations and negative operating cash flows since inception.

We will need to raise additional capital in the future to support our operations and product development activities.

In the near term,

For the years ended December 31, 2019 and 2018, BiomX had losses from operations of $23.2 and $12.5 million,

respectively.

We anticipate that our expenses will increase substantially if and as we:

to develop and conduct clinical trials with respect to our lead product candidate, BX001, and other product candidates in

our pipeline;

and continue research, preclinical and clinical development efforts for any future product candidates;

to discover and develop additional product candidates and further expand our clinical product pipeline;

marketing and regulatory approvals for any product candidates that successfully complete clinical trials;

the manufacture of larger quantities of product candidates for clinical development and, potentially, commercialization;

expand and protect our intellectual property portfolio;

our research and development infrastructure, including hiring and retaining additional personnel, such as clinical, quality

control and scientific personnel;

sales, marketing, distribution and other commercial infrastructure in the future to commercialize products for which we obtain

marketing approval, if any;

operational, financial and management information systems and personnel, including personnel to support our product development

and commercialization and help us comply with our obligations as a subsidiary of a public company.

will need to raise additional capital in the future to support our operations.

December 31, 2019, the Company had cash, cash equivalents and short-term deposits of $82.3 million, and it has had recurring losses

from operations and negative operating cash flows since inception.

We will need to raise additional capital in the future to support

our operations and product development activities.

In the near term, we expect to continue to fund our operations and other development

activities relating to additional product candidates from the cash held by us, governmental and other grants and through future

equity financings.

We may also seek funds through arrangements with collaborators or others that may require us to relinquish

rights to the product candidates that we might otherwise seek to develop or commercialize independently.

If we enter into a collaboration

for one or more of our current or future product candidates at an earlier development stage, the terms of such a collaboration

will likely be less favorable than if we were to enter the collaboration in later stages or if we commercialized the product independently.

If we raise additional funds through equity offerings, the terms of these securities may include liquidation or other preferences

that adversely affect our stockholders’

we expect to continue to fund our operations and other development activities relating to additional product candidates from the cash

held by us, governmental and other grants and through future equity financings.

In connection with our efforts to raise additional capital,

we filed a shelf registration statement on Form S-3, which was declared effective by the SEC on December 11, 2020.

In addition, on December

4, 2020, we entered into an Open Market Sale Agreement SM , or the Sale Agreement, with Jefferies LLC, or Jefferies, pursuant

to which we may issue and sell shares of our Common Stock having an aggregate offering price of up to $50,000,000 from time to time through

Jefferies and through March 25, 2021, we sold an aggregate of 610,820 shares of Common Stock pursuant to the Sale Agreement for aggregate

gross proceeds of $4,519,474.

We may continue to sell shares under the Sale Agreement and otherwise to use our shelf registration statement

to raise additional funds from time to time.

We may also seek funds through arrangements with collaborators or others that may require

us to relinquish rights to the product candidates that we might otherwise seek to develop or commercialize independently.

into a collaboration for one or more of our current or future product candidates at an earlier development stage, the terms of such a

collaboration will likely be less favorable than if we were to enter the collaboration in later stages or if we commercialized the product

independently.

If we raise additional funds through equity offerings, the terms of these securities may include liquidation or other

preferences that adversely affect our stockholders’

rights or cause significant dilution to our stockholders.

3 unchanged sentences

or licensing intellectual property rights.

additional capital is not available to us when needed or on acceptable terms, we may not be able to continue to operate our business

pursuant to our business plan and may be required to delay our clinical development.

While we believe that our existing cash and

cash equivalents, together with our existing resources, will be sufficient to fund our planned operations for at least the next

24 months, we cannot provide assurances that our estimates are accurate, that our plans will not change or that changed circumstances

will not result in the depletion of our capital resources more rapidly than we currently anticipate.

drugs and conducting clinical trials is expensive.

If additional capital is not available

to us when needed or on acceptable terms, we may not be able to continue to operate our business pursuant to our business plan

and may be required to delay our clinical development.

While we believe that our existing cash and cash equivalents, together

with our existing resources, will be sufficient to fund our planned operations until at least mid-2022, we cannot provide assurances

that our estimates are accurate, that our plans will not change or that changed circumstances will not result in the depletion

of our capital resources more rapidly than we currently anticipate.

Developing drugs and conducting clinical

trials is expensive.

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

costs, timing and progress of our research and development and clinical activities;

manufacturing

costs associated with our targeted bacteriophage, or phage, therapies strategy and other research and development activities;

terms and timing of any collaborative, licensing, acquisition or other arrangements that we may establish;

employee-related

expenses, as well as external costs such as fees paid to outside consultants;

costs and timing of seeking regulatory approvals and related to compliance with regulatory requirements;

costs of filing, prosecuting, defending and enforcing any patent applications, claims, patents and other intellectual property

and international equity and debt markets have experienced and may continue to experience heightened volatility and turmoil based

on domestic and international economic conditions and concerns.

In the event these economic conditions and concerns continue or

worsen and the markets continue to remain volatile, or a bear market, or recession, ensues in the U.S.

stock market, and the impact

recently seen associated with the coronavirus outbreak, our operating results and liquidity could be affected adversely by those

factors in many ways, including making it more difficult for us to raise funds if necessary and our stock price may decline.

can be no assurance that sufficient funds will be available to us when required or on acceptable terms, if at all.

Our inability

to obtain additional funds could have a material adverse effect on our business, financial condition and results of operations.

Moreover, if we are unable to obtain additional funds on a timely basis, there will be substantial doubt about our ability to

continue as a going concern and increased risk of insolvency and up to a total loss of investment by our shareholders.

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

inception in 2015, BiomX has devoted substantially all of its resources to developing product candidates with phage technology

through its preclinical programs, building its intellectual property portfolio, developing a supply chain, planning its business,

raising capital and providing general and administrative support for these operations.

We have not yet demonstrated our ability

to successfully complete any clinical study or other pivotal clinical trials, 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

product commercialization.

Additionally, we expect our financial condition and operating results to fluctuate significantly from

quarter to quarter and year to year due to a variety of factors, many of which are beyond our control.

Consequently, any predictions

made about our future success or viability may not be as accurate as they could be if we had a longer operating history.

addition, as an early-stage company, we may encounter unforeseen expenses, difficulties, complications, delays and other known

and unknown circumstances.

As we advance our product candidates, we will need to transition from a company with a research focus

to a company capable of supporting clinical development and, if successful, commercial activities.

We may not be successful in

such a transition.

have never generated any revenue from product sales and may never be profitable or, if achieved, may not sustain profitability.

ability to generate meaningful revenue and achieve profitability depends on our ability, and the ability of any third party with

which we may partner, to successfully complete the development of, and meet regulatory requirements, including (but not limited

to) obtaining any necessary regulatory approvals, to commercialize our product candidates.

We do not currently meet regulatory

requirements or have the required approvals to market our product candidates and may never meet or receive them.

We do not anticipate

generating revenue from product sales for the foreseeable future, if ever.

If any of our product candidates fail in clinical trials

or if any of our product candidates do not meet regulatory requirements, including gaining regulatory approval when needed, or

if any of our product candidates, if marketed, fail to achieve market acceptance, we may never become profitable.

Even if we achieve

profitability in the future, we may not be able to sustain profitability in subsequent periods.

Our ability to generate future

revenue from product sales depends heavily on our success in:

research and preclinical and clinical development of our product candidates;

and obtaining regulatory and marketing approvals for product candidates for which we complete clinical trials;

regulatory requirements for marketing the products;

a sustainable, scalable, reproducible and transferable manufacturing process for our product candidates;

and commercializing product candidates for which we obtain regulatory and marketing approval or are otherwise permitted to

market, either by establishing a sales force, marketing and distribution infrastructure or by collaborating with a partner;

market acceptance of any approved products;

any competing technological and market developments;

additional internal systems and infrastructure, as needed;

and validating new product candidates;

favorable terms in any collaboration, licensing or other arrangements into which we may enter;

protecting and expanding our portfolio of intellectual property rights, including patents, trade secrets and know-how;

hiring and retaining qualified personnel.

if one or more of the product candidates that we develop is approved for commercial sale or otherwise permitted for marketing,

we anticipate incurring significant costs associated with commercializing any approved product.

Our expenses could increase beyond

expectations if we are required by the U.S.

Food and Drug Administration (“FDA”), the European Medicines Agency (“EMA”)

or other equivalent foreign regulatory agencies to perform clinical trials and other studies in addition to those that we currently

Even if we are able to generate revenue from the sale of any approved products, we may not become profitable and may

need to obtain additional funding to continue operations.

If we fail to become profitable, or if we are unable to fund our continuing

losses, our business, financial condition and results of operations may be materially adversely impacted.

are seeking to develop product candidates using phage technology, an approach for which is difficult to predict the time and cost

of development.

To our knowledge, no bacteriophage has thus far been sold as a cosmetic or approved as a drug in the United States

or in the European Union.

the costs, timing and progress of our research

and development and clinical activities;

manufacturing costs associated with our targeted

bacteriophage, or phage, therapies strategy and other research and development activities;

the terms and timing of any collaborative, licensing,

acquisition or other arrangements that we may establish;

employee-related expenses, as well as external

costs such as fees paid to outside consultants;

the costs and timing of seeking regulatory approvals

and related to compliance with regulatory requirements;

the costs of filing, prosecuting, defending

and enforcing any patent applications, claims, patents and other intellectual property rights.

Domestic and international equity and debt

markets have experienced and may continue to experience heightened volatility and turmoil based on domestic and international

economic conditions and concerns.

In the event these economic conditions and concerns continue or worsen and the markets continue

to remain volatile, or a bear market, or recession, ensues in the U.S.

stock market, and the impact recently seen associated with

the coronavirus outbreak, our operating results and liquidity could be affected adversely by those factors in many ways, including

making it more difficult for us to raise funds if necessary and our stock price may decline.

There can be no assurance that sufficient

funds will be available to us when required or on acceptable terms, if at all.

Our inability to obtain additional funds could

have a material adverse effect on our business, financial condition and results of operations.

Moreover, if we are unable to obtain

additional funds on a timely basis, there will be substantial doubt about our ability to continue as a going concern and increased

risk of insolvency and up to a total loss of investment by our stockholders.

We are seeking to develop product candidates using phage

technology, an approach for which is difficult to predict the time and cost of development.

To our knowledge, no bacteriophage

has thus far been approved as a drug in the United States or in the European Union.

are developing our product candidates with phage technology.

We have not, nor to our knowledge have any other company, sold our

product candidates as cosmetics or received regulatory approval from the FDA or equivalent foreign regulatory agencies for a product

based on this approach.

While in vitro and in vivo studies have characterized the behavior of phage in cell cultures

and animal models and there exists a body of literature regarding the use of phage therapy in humans, the safety and efficacy

of phage therapy in humans has not been extensively studied in well-controlled modern clinical trials.

Most of the prior research

on phage-based therapy was conducted in the former Soviet Union prior to and immediately after World War II and lacked appropriate

control group design or lacked control groups at all.

Furthermore, the standard of care has changed substantially during the ensuing

decades since those studies were performed, diminishing the relevance of prior claims of improved cure rates.

Any product candidates

that we develop may not demonstrate in patients the therapeutic properties ascribed to them in laboratory and other preclinical

studies, and they may interact with human biological systems in unforeseen, ineffective or even harmful ways.

We cannot be certain

that our approach will lead to the development of approvable or marketable products.

Furthermore, the bacterial targets of phage

may develop resistance to our product candidates over time, which we may or may not be able to overcome with the development of

new phage cocktails or we may not be able to construct a cocktail with sufficient coverage of our target pathogen universe.

our product candidates receive regulatory approval but do not achieve an adequate level of acceptance by physicians, healthcare

payors and patients, we may not generate product revenue sufficient to attain profitability.

Our success will depend upon physicians

who specialize in the treatment of diseases targeted by our product candidates that we pursue as drugs, prescribing potential

treatments that involve the use of our product candidates in lieu of, or in addition to, existing treatments with which they are

more familiar and for which greater clinical data may be available.

Our success will also depend on consumer acceptance and adoption

of our products that we commercialize.

Adverse events in preclinical studies and clinical trials of our product candidates or

in clinical trials of others developing similar products and the resulting publicity, as well as any other adverse events in the

field of phage therapeutics, could result in a decrease in demand for any product that we may develop.

The degree of market acceptance

of any approved products will depend on a number of factors, including:

effectiveness of the product;

prevalence and severity of any side effects;

advantages or disadvantages over alternative treatments;

convenience and ease of administration;

strength of marketing and distribution support;

price of the product, both in absolute terms and relative to alternative treatments;

third-party coverage or reimbursement.

our product candidates on a commercial scale will require substantial technical, financial and human resources.

We and our third-party

collaborators may experience delays in developing manufacturing capabilities for our product candidates, and may not be able to

do so at the scale required to efficiently conduct the clinical trials required to obtain regulatory approval of those of our

product candidates that require it, or to manufacture commercial quantities of our products, if approved or otherwise permitted

to be marketed.

are considering marketing our lead candidate product —

We have not, nor to our knowledge has any other company, received

regulatory approval from the FDA, or equivalent foreign regulatory agencies for a product based on this approach.

vitro and in vivo studies have characterized the behavior of phage in cell cultures and animal models and there exists

a body of literature regarding the use of phage therapy in humans, the safety and efficacy of phage therapy in humans has not

been extensively studied in well-controlled modern clinical trials .

Most of the prior research on phage-based therapy was conducted in the former Soviet Union prior to and immediately after World

War II and lacked appropriate control group design or lacked control groups at all.

Furthermore, the standard of care has changed

substantially during the ensuing decades since those studies were performed, diminishing the relevance of prior claims of improved

Any product candidates that we develop may not demonstrate in patients the therapeutic properties ascribed to them

in laboratory and other preclinical studies, and they may interact with human biological systems in unforeseen, ineffective or

even harmful ways.

We cannot be certain that our approach will lead to the development of approvable or marketable products.

the bacterial targets of phage may develop resistance to our product candidates over time, which we may or may not be able to

overcome with the development of new phage cocktails or we may not be able to construct a cocktail with sufficient coverage of

our target pathogen universe.

If our product candidates receive regulatory

approval but do not achieve an adequate level of acceptance by physicians, healthcare payors and patients, we may not generate

product revenue sufficient to attain profitability.

Our success will depend upon physicians who specialize in the treatment of

diseases targeted by our product candidates that we pursue as drugs, prescribing potential treatments that involve the use of

our product candidates in lieu of, or in addition to, existing treatments with which they are more familiar and for which greater

clinical data may be available.

Our success will also depend on consumer acceptance and adoption of our products that we commercialize.

Adverse events in preclinical studies and clinical trials of our product candidates or in clinical trials of others developing

similar products and the resulting publicity, as well as any other adverse events in the field of phage therapeutics, could result

in a decrease in demand for any product that we may develop.

The degree of market acceptance of any approved products will depend

on a number of factors, including:

the effectiveness of the product;

the prevalence and severity of any side effects;

potential advantages or disadvantages over alternative

relative convenience and ease of administration;

the strength of marketing and distribution support;

the price of the product, both in absolute terms

and relative to alternative treatments;

sufficient third-party coverage or reimbursement.

Developing our product candidates on a

commercial scale will require substantial technical, financial and human resources.

We and our third-party collaborators may experience

delays in developing manufacturing capabilities for our product candidates, and may not be able to do so at the scale required

to efficiently conduct the clinical trials required to obtain regulatory approval of those of our product candidates that require

it, or to manufacture commercial quantities of our products, if approved or otherwise permitted to be marketed.

We are considering marketing our lead candidate

product —

BX001 —

as a cosmetic, although this positioning also presents

some challenges, as explained in the risk factors below.

in part on how BX001 is marketed, it may be classified as a cosmetic or a drug or as something else by the FDA and equivalent

foreign regulatory agencies.

There are fewer requirements to market cosmetics in the United States; however, if we attempt

to market as a cosmetic and the FDA disagrees with its classification, we may be required to stop marketing the product to pursue

approval as a drug and not market the product again until we receive such approval, which we may not receive.

FDA and equivalent foreign regulatory agencies regulate products largely by their intended uses, but may also consider the ingredients

of the product.

At the current time, such agencies have not approved a new drug application (“NDA”) or a Biologics

License Application for a phage product.

Products intended to beautify, moisturize, cleanse, or change one’s appearance

may be regulated as cosmetics.

Products intended to diagnose, prevent, cure or mitigate a disease or condition are regulated as

drugs (or in some cases, as medical devices).

premarket approval process is not required for cosmetic products.

Manufacturers of cosmetics must test for and assure that finished

products and all ingredients are safe prior to marketing them in the United States or the European Union, and claims may not be

made that the product prevents, mitigates or cures a condition or disease.

Products that claim to treat acne are generally regulated

as drugs in the United States and the European Union.

In the United States, drug products must either be approved through one

of several FDA drug approval pathways or, in the case of some over-the-counter (“OTC”) drugs, meet the monograph criteria

established by U.S.

Similarly, in the European Union, drugs must be approved by the national regulatory authority

or the European Commission before being placed on the national or European market.

we market BX001 as a cosmetic, we will not be able to promote the product for the treatment of acne, and our main claims would

be limited to those that are consistent with permitted cosmetic claims, to beautify, moisturize, cleanse or change the appearance

of the skin such as “for beautiful, bright skin”

as a cosmetic, although this positioning also presents some challenges, as explained in this “Risk

Factors”

Our product candidates must undergo clinical testing

which may fail to demonstrate the requisite safety and tolerability for cosmetics, safety and efficacy for drug products, or safety,

purity, and potency for biologics, and any of our product candidates could cause adverse effects, which would substantially delay

or prevent regulatory approval and/or commercialization.

Before we can obtain regulatory approval

for a product candidate or otherwise obtain evidence allowing us to market the product, we must undertake extensive preclinical

and clinical testing in humans to demonstrate safety and efficacy to the satisfaction of the FDA or other regulatory agencies.

Clinical trials of product candidates sufficient to obtain regulatory marketing approval or otherwise demonstrate safety prior

to marketing, are expensive and take years to complete, especially for our product candidate designed to treat CRC as the phage

will be genetically modified, which could make the conduct of clinical trials more complex.

Furthermore, results from these clinical

trials may not show safety or efficacy of our product candidates sufficient to lead to approval, or to warrant further development.

For example, our approach is intended to design phage combinations, or cocktails, to target specific strains of pathogenic bacteria

in order to alter microbiome composition and confer potential therapeutic or cosmetic benefit to patients.

However, there can

be no assurance that the eradication of the selected targets will result in a clinically meaningful effect on the underlying disease,

such as in cases where the pathology of the disease is not well-defined.

In addition, the bacteria that we target may be associated

with the disease, but may not be causative or contributive to the pathology of the disease, or there may be other bacteria that

our product candidates do not target that are more meaningful drivers of the underlying disease.

In addition, our product candidates

require the use of effective delivery vehicles to reach the target organ or tissue, and there can be no assurance that our intended

delivery systems will allow our product candidates to reach the desired locations in a patient.

Safety must first be established

through preclinical testing and early clinical trials, before efficacy can be evaluated and established and thereby lead to FDA

or other regulatory agencies marketing approval.

Our clinical trials may produce undesirable side effects or negative or inconclusive

results, and we may decide, or regulators may require us, to conduct additional clinical and/or preclinical testing or to abandon

The ongoing COVID-19 pandemic

has and may continue to adversely affect our business, including our clinical trials.

The COVID-19 pandemic has had and continues to have a significant impact,

both direct and indirect, on businesses and commerce, as worker shortages have occurred;

supply chains have been disrupted;

and production have been suspended;

and demand for certain goods and services, such as medical services and supplies, has spiked, while

demand for other goods and services, such as travel, has fallen.

In response to the spread of COVID-19, we temporarily had closed

our executive offices with our administrative employees continuing their work outside of our offices and may need to close them again

in the future.

In addition, we have modified our business practices, including restricting employee travel, developing social distancing

plans for our employees and cancelling physical participation in meetings, events and conferences.

As a result of the COVID-19 pandemic,

we have experienced and may continue to experience additional disruptions that could severely impact our business, preclinical studies

and clinical trials, including:

delays or difficulties in enrolling patients

in our clinical trials;

delays or difficulties in clinical site initiation,

including difficulties in recruiting clinical site investigators and clinical site staff;

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 data monitoring, due to limitations on travel imposed or recommended by federal or state governments,

and the government in Israel, employers and others or interruption of clinical trial subject visits and study

procedures (such as endoscopies that are deemed non-essential), which may impact the integrity of subject data and clinical

study endpoints;

interruption or delays in the operations of

the FDA or other regulatory authorities, which may impact review and approval timelines;

interruption of, or delays in receiving, supplies

of our product candidates from our contract manufacturing organizations due to staffing shortages, production slowdowns or

stoppages and disruptions in delivery systems;

limitations on employee resources that would

otherwise be focused on the conduct of our clinical trials, including because of sickness of employees or their families or

the desire of employees to avoid contact with large groups of people;

interruptions or

delays to our sourced discovery and clinical activities.

The pandemic and the resulting government actions have impacted

and may continue to adversely impact our planned and ongoing clinical trials.

Clinical site initiation, including difficulties

in recruiting clinical site investigators and clinical site staff, and patient enrollment may be delayed due to prioritization

of hospital resources toward the COVID-19 pandemic.

Some patients have not been willing and/or able to comply with clinical

trial protocols due to the COVID-19 pandemic, particularly if quarantines or other restrictions impede patient movement

or interrupt healthcare services.

Similarly, our ability to recruit and retain patients and principal investigators and site staff

who, as healthcare providers, may have heightened exposure to COVID-19 has been impeded and may continue to remain impeded,

which would adversely impact our clinical trial operations.

The diversion of healthcare resources away from the conduct of clinical

trials to focus on pandemic concerns, including the attention of physicians serving as our clinical trial investigators and hospitals

serving as our clinical trial sites, may significantly disrupt our research activities.

As a result, the expected timeline for

data readouts of our clinical trials and certain regulatory filings will likely be negatively impacted, which would adversely affect

and delay our ability to obtain regulatory approvals for our product candidates, increase our operating expenses and have a material

adverse effect on our financial condition.

Furthermore, the response to the COVID-19 pandemic

may redirect resources with respect to regulatory matters and intellectual property matters in a way that would adversely impact

our ability to progress regulatory approvals and protect our intellectual property.

In addition, we may face impediments to regulatory

meetings and approvals due to measures intended to limit in-person interactions.

For example, the FDA postponed most

inspections of foreign manufacturing facilities and products and postponed routine surveillance inspections of domestic manufacturing

Comparable regulatory authorities in other jurisdictions may adopt similar restrictions or other policy measures in

response to the COVID-19 pandemic and provide guidance regarding the conduct of clinical trials.

If global health concerns

continue to prevent the FDA or other regulatory authorities 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.

The COVID-19 pandemic continues

The extent to which the outbreak impacts our business, preclinical studies 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 pandemic, travel restrictions and social distancing in the United States Canada, Europe, Israel and

other countries, business closures or business disruptions and the effectiveness of actions taken in the United States, Canada,

Europe, Israel and other countries to contain and treat the disease.

As a result, the COVID-19 pandemic has had and

may continue to have a material adverse effect on our business, results of operations, financial condition and prospects and heighten

many of our known risks described or referenced in this “Risk Factors”

If we are not able to obtain, or if there are delays

in obtaining, required regulatory approvals for our product candidates for therapeutic indications, we will not be able to commercialize,

or will be delayed in commercializing, our product candidates, and our future ability to generate revenue will be materially impaired.

Our product candidates and the activities

associated with their development and commercialization for therapeutic indications, including their design, testing, manufacture,

safety, efficacy, recordkeeping, labeling, storage, approval, advertising, promotion, sale, distribution, import and export are

subject to regulation by the FDA and other regulatory agencies in the United States and by equivalent foreign regulatory authorities.

Before we can commercialize any of our product candidates for therapeutic indications, we must obtain marketing approval.

not received approval to market any of our product candidates from regulatory authorities in any jurisdiction, and it is possible

that none of our product candidates or any product candidates we may seek to develop in the future will ever obtain regulatory

The process of obtaining regulatory approvals

for therapeutic indications, both in the United States and in other countries, is expensive, may take many years if additional

clinical trials are required, and can vary substantially based upon a variety of factors, including the type, complexity and novelty

of the product candidates involved.

Changes in marketing approval policies during the development period, changes in or the enactment

of additional statutes or regulations, or changes in regulatory review for each submitted IND, new drug application, or NDA, or

equivalent application types, may cause delays in the approval or rejection of an application.

The FDA and equivalent foreign

regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may decide

that our data is insufficient for approval and require additional preclinical, clinical or other studies.

Our product candidates

could be delayed in receiving, or fail to receive, regulatory approval for many reasons, including the following:

the FDA or equivalent foreign regulatory authorities

may disagree with the design, including study population, dose level, dose regimen, and bioanalytical assay methods, or implementation

of our clinical trials;

we may be unable to demonstrate to the satisfaction

of the FDA or equivalent foreign regulatory authorities that a drug candidate is safe and effective for its proposed indication

or a related companion diagnostic is suitable to identify appropriate patient populations;

the results of clinical trials may not meet

the level of statistical significance required by the FDA or equivalent foreign regulatory authorities for approval;

we may be unable to demonstrate that a drug

product candidate’s clinical and other benefits outweigh its safety risks;

the FDA or equivalent foreign regulatory authorities

may disagree with our interpretation of data from preclinical studies, non-IND human clinical studies or clinical trials;

the data collected from clinical trials of our

product candidates may not be sufficient to support the submission of an NDA or other submission or to obtain regulatory approval

in the United States or elsewhere;

the FDA or equivalent foreign regulatory authorities

may fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical

and commercial supplies;

the approval policies or regulations of the

FDA or equivalent foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient

for approval.

Of the large number of drugs in development,

only a small percentage successfully complete the FDA or equivalent foreign regulatory approval processes and are commercialized.

The lengthy approval process as well as the unpredictability of future clinical trial results may result in us failing to obtain

regulatory approval to market its product candidates, which would significantly harm our business, results of operations and prospects.

The FDA may also require a panel of experts,

referred to as an Advisory Committee, to deliberate on the adequacy of the safety and efficacy data to support approval for therapeutic

The opinion of the Advisory Committee, although not binding, may have a significant impact on our ability to obtain

approval of any product candidates that we develop based on the completed clinical trials.

In the European Union, the safety and

efficacy data of our product candidate for the treatment of CRC will be reviewed by the European Medicines Agency’s, or

the EMA’s, Committee for Advanced Therapies, or CAT, a group of experts in advanced therapy medicinal products.

product candidates would be reviewed by CAT as well if the EMA were to consider that they also qualify as advanced therapy medicinal

Moreover, under PREA, in the United States, and the Paediatric

Regulation, in the European Union, the FDA or equivalent foreign regulatory authority could require mandatory testing in the pediatric

Applications for approval in the United States or in the European Union must contain data to assess the safety and

efficacy of the biologic for the claimed indications in all relevant pediatric subpopulations and to support dosing and administration

for each pediatric subpopulation for which the product is safe and effective.

The FDA or equivalent foreign regulatory authority

may, in its discretion, grant full or partial waivers, or deferrals, for submission of data in pediatric subjects.

If the FDA requires

data in pediatric patients, significantly more capital will have to be invested in order to conduct the mandatory pediatric clinical

trials and studies, but the approval of the medicinal products for the adult population should normally not be affected.

results of such pediatric studies are not positive, our product candidates will not be approved for children.

In addition, even if we were to obtain

approval, regulatory authorities may approve any of our product candidates for fewer or more limited therapeutic indications than

our requests, may include limitations for use or contraindications that limit the suitable patient population, may not approve

the price we intend to charge for our products, may grant approval contingent on the performance of costly post-marketing clinical

trials or may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the

successful commercialization of that product candidate.

Any of the foregoing scenarios could materially harm the commercial prospects

for our product candidates.

If we experience delays in obtaining approval

or if we fail to obtain approval of our product candidates, the commercial prospects for our product candidates may be harmed

and our future ability to generate revenues will be materially impaired.

Regulatory requirements for development of our product

candidates are uncertain and evolving.

Changes in these laws or the current interpretation or application of these laws would

have a significant adverse impact on our ability to develop and commercialize our product candidates.

We intend to develop our lead product candidate, BX001 initially

as a cosmetic gel designed to improve the appearance of acne-prone skin.

BX001 contains known cosmetic ingredients combined with

phage that are designed to help control the growth of C.

acnes , and thereby help improve the appearance of acne-prone skin.

In the European Union, a product candidate

is considered to be a cosmetic if it is intended to and presented as protecting the skin, maintaining the skin in good condition

or improving the appearance of the skin, provided that it is not a medicinal product due to its composition.

With regard to the

ingredients, in the European Union, the composition of a cosmetic may not be such that it has a significant effect on the body

through a pharmacological, immunological or metabolic mode of action.

No test has been determined yet for the significance of

By contrast, a product candidate is a drug if it is intended to or presented as treating or preventing a disease or

restoring, correcting or modifying significantly physiological functions by a pharmacological, immunological or metabolic action.

However, in the European Union, medical or biocidal (i.e.

antibacterial) claims may be made for cosmetics, provided that they

are ancillary to the cosmetic claims.

As a result, we believe that we may develop BX001 as a cosmetic, including conducting non-IND

human clinical studies in order to evaluate safety, tolerability and biomarkers for non-drug applications.

Some countries also regulate other categories

of products that could be relevant such as biocides in the European Union.

Unlike medicinal products, cosmetic products are generally not

subject to premarket approval by regulatory agencies.

However, they must not contain certain ingredients or concentrations of ingredients

and must be safe and properly labeled in relation to their cosmetic purpose.

We remain unclear whether phage are authorized for

use in cosmetic products, in the United States, the European Union and other countries.

Moreover, the FDA or equivalent foreign

regulatory agencies may determine that BX001 is not governed by cosmetics regulations but by pharmaceutical regulations and, therefore

may classify BX001 as being ineligible for use in clinical studies without a regulatory approval.

A determination that BX001 does

not meet the regulatory cosmetic requirements of the FDA or equivalent foreign regulatory agencies could cause a delay in the

commercialization of BX001, which may lead to reduced acceptance by the public or others.

Any such determination could prevent

our reliance on existing regulatory frameworks to conduct non-IND human clinical studies for BX001 and could significantly increase

the cost of and delay the commercialization of BX001.

Should we choose to continue to develop

and commercialize BX001 as a cosmetic and if the FDA or equivalent foreign regulatory agencies determine BX001 falls outside the

cosmetics regulations, the agency could ask us to withdraw BX001 from the market.

In addition, if new safety issues are raised

by cosmetic clinical studies for BX001, then our ability to seek an IND to conduct clinical trials intended to lead toward approval

of the product as a drug, if pursued, could be adversely affected, for example the FDA or equivalent foreign regulatory agencies

could ask us to modify approved labeling for or withdraw BX001 from the market.

We have never generated any revenue from product sales

and may never be profitable or, if achieved, may not sustain profitability.

Our ability to generate meaningful revenue

and achieve profitability depends on our ability, and the ability of any third party with which we may partner, to successfully

complete the development of, and meet regulatory requirements, including (but not limited to) obtaining any necessary regulatory

approvals, to commercialize our product candidates.

We do not currently meet regulatory requirements or have the required approvals

to market our product candidates and may never meet or receive them.

We do not anticipate generating revenue from product sales

for the foreseeable future, if ever.

If any of our product candidates fail in clinical trials or if any of our product candidates

do not meet regulatory requirements, including gaining regulatory approval when needed, or if any of our product candidates, if

marketed, fail to achieve market acceptance, we may never become profitable.

Even if we achieve profitability in the future, we

may not be able to sustain profitability in subsequent periods.

Our ability to generate future revenue from product sales depends

heavily on our success in:

completing research and preclinical and clinical

development of our product candidates;

seeking and obtaining regulatory and marketing

approvals for product candidates for which we complete clinical trials;

meeting regulatory requirements for marketing

the products;

developing a sustainable, scalable, reproducible

and transferable manufacturing process for our product candidates;

launching and commercializing product candidates

for which we obtain regulatory and marketing approval or are otherwise permitted to market, either by establishing a sales

force, marketing and distribution infrastructure or by collaborating with a partner;

obtaining market acceptance of any approved

addressing any competing technological and market

developments;

implementing additional internal systems and

infrastructure, as needed;

identifying and validating new product candidates;

negotiating favorable terms in any collaboration,

licensing or other arrangements into which we may enter;

maintaining, protecting and expanding our portfolio

of intellectual property rights, including patents, trade secrets and know-how;

attracting, hiring and retaining qualified personnel.

Even if one or more of the product candidates

that we develop is approved for commercial sale or otherwise permitted for marketing, we anticipate incurring significant costs

associated with commercializing any approved product.

Our expenses could increase beyond expectations if we are required by the

FDA, or the EMA, or other equivalent foreign regulatory agencies to perform clinical trials and other studies in addition to those

that we currently anticipate.

Even if we are able to generate revenue from the sale of any approved products, we may not become

profitable and may need to obtain additional funding to continue operations.

If we fail to become profitable, or if we are unable

to fund our continuing losses, our business, financial condition and results of operations may be materially adversely impacted.

Depending in part on how BX001 is marketed, it may be

classified as a cosmetic or a drug or as something else by the FDA and equivalent foreign regulatory agencies.

There are fewer

requirements to market cosmetics in the United States;

however, if we attempt to market as a cosmetic and the FDA disagrees with

its classification, we may be required to stop marketing the product to pursue approval as a drug and not market the product again

until we receive such approval, which we may not receive.

The FDA and equivalent foreign regulatory agencies regulate

products largely by their intended uses but may also consider the ingredients of the product.

At the current time, such agencies

have not approved an NDA, or a BLA for a phage product.

Products intended to beautify, moisturize, cleanse, or change one’s

appearance may be regulated as cosmetics.

Products intended to diagnose, prevent, cure or mitigate a disease or condition are regulated

as drugs (or in some cases, as medical devices).

A premarket approval process is not required

for cosmetic products.

Manufacturers of cosmetics must test for and assure that finished products and all ingredients are safe

prior to marketing them in the United States or the European Union, and claims may not be made that the product prevents, mitigates

or cures a condition or disease.

Products that claim to treat acne are generally regulated as drugs in the United States and the

European Union.

In the United States, drug products must either be approved through one of several FDA drug approval pathways

or, in the case of some over-the-counter, or OTC, drugs, meet the monograph criteria established by U.S.

in the European Union, drugs must be approved by the national regulatory authority or the European Commission before being placed

on the national or European market.

If we market BX001 as a cosmetic, as we currently plan to, we

will not be able to promote the product for the treatment of acne, and our main claims would be limited to those that are consistent

with permitted cosmetic claims, to beautify, moisturize, cleanse or change the appearance of the skin such as “for beautiful,

bright skin”

and similar claims.

If we market the product as a cosmetic, it is

possible that the FDA or equivalent foreign regulatory agencies will disagree with us and find that the product should be marketed

Although the FDA or equivalent foreign regulatory agencies have not affirmatively decided the regulatory status of

phages, given that their function is antibacterial, it is possible that the such agencies will decide that products containing

phages are drugs regardless of the claims presented on the product or any other considerations.

If the FDA evaluates BX001 and

determines that the product is a drug and marketing it as a cosmetic is a prohibited act under the Food, Drug, and Cosmetic Act,

it may issue a Warning Letter and demand that we stop marketing the product unless and until the product is approved as a drug.

If the FDA issues a Warning Letter, it will be made available on the FDA’s website, and we may suffer reputational damage.

If we market the product as a cosmetic, it is possible that the FDA or equivalent foreign

regulatory agencies will disagree with us and find that the product should be marketed as a drug.

Although the FDA or equivalent

foreign regulatory agencies have not affirmatively decided the regulatory status of phage, given that their function is antibacterial,

it is possible that such agencies will decide that products containing phage are drugs regardless of the claims presented on the

product or any other considerations.

If the FDA evaluates BX001 and determines that the product is a drug and marketing it as a

cosmetic is a prohibited act under the FDCA, it may issue a Warning Letter and demand that we stop marketing the product unless

and until the product is approved as a drug.

If the FDA issues a Warning Letter, it will be made available on the FDA’s website,

and we may suffer reputational damage.

The same applies to the national competent authorities in the European Union.

There is the risk that if we go to market with BX001

as a cosmetic, potential competitors will bring the FDA’s or equivalent foreign regulatory authorities’

to the marketing of BX001 as a cosmetic to encourage the FDA or equivalent foreign regulatory authorities to take this very type

of enforcement action against us.

is possible that the regulatory requirements or framework will change by the time we are ready to market our product and these

changes may eliminate the possibility of marketing BX001 as a cosmetic.

For example, the FDA could affirmatively determine that

phages are to be regulated as drugs and are not permitted in cosmetic products.

If this were to occur, then BX001 would need to

be approved as a drug in order to be marketed in the United States and would need to be approved as an OTC drug rather than a

prescription drug in order to be sold in products that are also cosmetics.

risk that if we go to market with BX001 as a cosmetic, potential competitors will bring the FDA’s or equivalent foreign regulatory

authorities’

attention to the marketing of BX001 as a cosmetic to encourage the FDA or equivalent foreign regulatory authorities

to take this very type of enforcement action against us.

It is possible that the regulatory requirements or framework

will change by the time we are ready to market our product and these changes may eliminate the possibility of marketing BX001 as

For example, the FDA could affirmatively determine that phage are to be regulated as drugs and are not permitted in

cosmetic products.

If this were to occur, then BX001 would need to be approved as a drug in order to be marketed in the United

States and would need to be approved as an OTC drug rather than a prescription drug in order to be sold in products that are also

The same applies in the European Union.

on the regulatory environment and requirements at the time BX001 is ready for market, we may decide that pursuing a drug approval

(either prescription or OTC) is the better pathway to market, in which case, it will take longer to bring BX001 to market in the

United States and in other countries.

And in this case, all other risks generally related to approval pathways would also be applicable

even if we are permitted to market BX001 as a cosmetic in one country, this does not guarantee that we will be permitted to market

BX001 as a cosmetic in other countries.

Each country has its own distinct requirements for marketing products as cosmetics and

BX001 would need to independently meet each jurisdiction’s requirements.

requirements for development of our lead product candidate, BX001, are uncertain and evolving.

Changes in these laws or the current

interpretation or application of these laws would have a significant adverse impact on our ability to develop and commercialize

intend to develop our lead product candidate, BX001 initially as a cosmetic gel designed to improve the appearance of acne-prone

BX001 contains known cosmetic ingredients combined with phages that are designed to help control the growth of C.

and thereby help improve the appearance of acne-prone skin.

the European Union, a product candidate is considered to be a cosmetic if it is intended to and presented as protecting the skin,

maintaining the skin in good condition or improving the appearance of the skin, provided that it is not a medicinal product due

to its composition.

With regard to the ingredients, in the European Union, the composition of a cosmetic may not be such that

it has a significant effect on the body through a pharmacological, immunological or metabolic mode of action.

No test has been

determined yet for the significance of the effect.

By contrast, a product candidate is a drug if it is intended to or presented

as treating or preventing a disease or restoring, correcting or modifying significantly physiological functions by a pharmacological,

immunological or metabolic action.

However, in the European Union, medical or biocidal (i.e.

antibacterial) claims may be made

for cosmetics, provided that they are ancillary to the cosmetic claims.

As a result, we believe that we may develop BX001 as a

cosmetic, including conducting non-investigational new drug (“IND”) human clinical studies in order to evaluate safety,

tolerability and biomarkers for non-drug applications.

countries also regulate other categories of products that could be relevant such as biocides in the European Union.

medicinal products, cosmetic products are generally not subject to premarket approval by regulatory agencies.

They however must

not contain certain ingredients or concentrations of ingredients and must be safe and properly labeled in relation to their cosmetic

We remain unclear whether phages are authorized for use in cosmetic products, in the United States, the European Union

and other countries.

the FDA or equivalent foreign regulatory agencies may determine that BX001 is not governed by cosmetics regulations but by pharmaceutical

regulations and, therefore may classify BX001 as being ineligible for use in clinical studies without a regulatory approval.

determination that BX001 does not meet the regulatory cosmetic requirements of the FDA or equivalent foreign regulatory agencies

could cause a delay in the commercialization of BX001, which may lead to reduced acceptance by the public or others.

determination could prevent our reliance on existing regulatory frameworks to conduct non-IND human clinical studies for BX001

and could significantly increase the cost of and delay the commercialization of BX001.

we choose to develop and commercialize BX001 as a cosmetic and if the FDA or equivalent foreign regulatory agencies determine

BX001 falls outside the cosmetics regulations, the agency could ask us to withdraw BX001 from the market.

In addition, if new

safety issues are raised by cosmetic clinical studies for BX001, then our ability to seek an IND to conduct clinical trials intended

to lead toward approval of the product as a drug, if pursued, could be adversely affected, for example the FDA or equivalent foreign

regulatory agencies could ask us to modify approved labeling for or withdraw BX001 from the market.

are seeking to develop product candidates to improve the appearance of acne-prone skin and treat medical conditions related to

the presence of certain bacteria.

Our success is largely dependent on a broad degree of market acceptance, and in the case of

drug products, physician adoption and use, which are necessary for commercial success.

if we obtain FDA or foreign regulatory approvals for our drug product candidates, or BX001 is permitted to be marketed as a cosmetic,

the commercial success of our product candidates will depend on consumer acceptance and adoption of products that we commercialize.

Adverse events in preclinical studies and clinical trials of our product candidates or in clinical trials of others developing

similar products and the resulting publicity could result in a decrease in demand for any product that we may develop.

addition, the commercial success of our drug product candidates will depend significantly on their broad adoption and use by dermatologists,

pediatricians and other physicians for approved therapeutic indications, as well as any other indications for which we may seek

We cannot be certain that our approach will lead to the development of approvable or marketable products.

high titers for specific phage cocktails necessary for our preclinical and clinical testing may be difficult and time-consuming.

product candidates are phage cocktails that we have designed to meet specific characteristics.

We and our contract manufacturers

produce a cocktail of multiple phage and it may be difficult or time-consuming to achieve high titers, or levels, of phage sufficient

for our preclinical and clinical testing.

In some cases, it may require multiple product runs in order for us to obtain the amounts

necessary for its clinical testing.

This may result in delays in our clinical trial timelines, and it may increase production

costs and associated expenses.

Also, it may be difficult to reproduce the manufacturing process to the extent that more significant

quantities are required as our product candidates advance through the clinical development process.

product candidates must undergo clinical testing which may fail to demonstrate the requisite safety and tolerability for cosmetics,

safety and efficacy for drug products, or safety, purity, and potency for biologics, and any of our product candidates could cause

adverse effects, which would substantially delay or prevent regulatory approval and/or commercialization.

we can obtain regulatory approval for a product candidate or otherwise obtain evidence allowing us to market the product, we must

undertake extensive preclinical and clinical testing in humans to demonstrate safety and efficacy to the satisfaction of the FDA

or other regulatory agencies.

Clinical trials of product candidates sufficient to obtain regulatory marketing approval or otherwise

demonstrate safety prior to marketing, are expensive and take years to complete, especially for our product candidate designed

to treat colorectal cancer (“CRC”) as the phage will be genetically modified, which could make the conduct of clinical

trials more complex.

Furthermore, results from these clinical trials may not show safety or efficacy of our product candidates

sufficient to lead to approval, or to warrant further development.

For example, our approach is intended to design phage combinations,

or cocktails, to target specific strains of pathogenic bacteria in order to alter microbiome composition and confer potential

therapeutic or cosmetic benefit to patients.

However, there can be no assurance that the eradication of the selected targets will

result in a clinically meaningful effect on the underlying disease, such as in cases where the pathology of the disease is not

well-defined.

In addition, the bacteria that we target may be associated with the disease, but may not be causative or contributive

to the pathology of the disease, or there may be other bacteria that our product candidates do not target that are more meaningful

drivers of the underlying disease.

In addition, our product candidates require the use of effective delivery vehicles to reach

the target organ or tissue, and there can be no assurance that our intended delivery systems will allow our product candidates

to reach the desired locations in a patient.

Safety must first be established through preclinical testing and early clinical trials,

before efficacy can be evaluated and established and thereby lead to FDA or other regulatory agencies marketing approval.

clinical trials may produce undesirable side effects or negative or inconclusive results, and we may decide, or regulators may

require us, to conduct additional clinical and/or preclinical testing or to abandon programs.

we are not able to obtain, or if there are delays in obtaining, required regulatory approvals for our product candidates for therapeutic

indications, we will not be able to commercialize, or will be delayed in commercializing, our product candidates, and our future

ability to generate revenue will be materially impaired.

product candidates and the activities associated with their development and commercialization for therapeutic indications, including

their design, testing, manufacture, safety, efficacy, recordkeeping, labeling, storage, approval, advertising, promotion, sale,

distribution, import and export are subject to regulation by the FDA and other regulatory agencies in the United States and by

equivalent foreign regulatory authorities.

Before we can commercialize any of our product candidates for therapeutic indications,

we must obtain marketing approval.

We have not received approval to market any of our product candidates from regulatory authorities

in any jurisdiction, and it is possible that none of our product candidates or any product candidates we may seek to develop in

the future will ever obtain regulatory approval.

process of obtaining regulatory approvals for therapeutic indications, both in the United States and in other countries, is expensive,

may take many years if additional clinical trials are required, and can vary substantially based upon a variety of factors, including

the type, complexity and novelty of the product candidates involved.

Changes in marketing approval policies during the development

period, changes in or the enactment of additional statutes or regulations, or changes in regulatory review for each submitted

IND, NDA or equivalent application types, may cause delays in the approval or rejection of an application.

The FDA and equivalent

foreign regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or

may decide that our data is insufficient for approval and require additional preclinical, clinical or other studies.

candidates could be delayed in receiving, or fail to receive, regulatory approval for many reasons, including the following:

FDA or equivalent foreign regulatory authorities may disagree with the design, including study population, dose level, dose

regimen, and bioanalytical assay methods, or implementation of our clinical trials;

may be unable to demonstrate to the satisfaction of the FDA or equivalent foreign regulatory authorities that a drug candidate

is safe and effective for its proposed indication or a related companion diagnostic is suitable to identify appropriate patient

results of clinical trials may not meet the level of statistical significance required by the FDA or equivalent foreign regulatory

authorities for approval;

may be unable to demonstrate that a drug product candidate’s clinical and other benefits outweigh its safety risks;

FDA or equivalent foreign regulatory authorities may disagree with our interpretation of data from preclinical studies, non-IND

human clinical studies or clinical trials;

data collected from clinical trials of our product candidates may not be sufficient to support the submission of an NDA or

other submission or to obtain regulatory approval in the United States or elsewhere;

FDA or equivalent foreign regulatory authorities may fail to approve the manufacturing processes or facilities of third-party

manufacturers with which we contract for clinical and commercial supplies;

approval policies or regulations of the FDA or equivalent foreign regulatory authorities may significantly change in a manner

rendering our clinical data insufficient for approval.

the large number of drugs in development, only a small percentage successfully complete the FDA or equivalent foreign regulatory

approval processes and are commercialized.

The lengthy approval process as well as the unpredictability of future clinical trial

results may result in us failing to obtain regulatory approval to market its product candidates, which would significantly harm

our business, results of operations and prospects.

FDA may also require a panel of experts, referred to as an Advisory Committee, to deliberate on the adequacy of the safety and

efficacy data to support approval for therapeutic indications.

The opinion of the Advisory Committee, although not binding, may

have a significant impact on our ability to obtain approval of any product candidates that we develop based on the completed clinical

In the European Union, the safety and efficacy data of our product candidate for the treatment of CRC will be reviewed

by the EMA’s Committee for Advanced Therapies (“CAT”), a group of experts in advanced therapy medicinal products.

Our other product candidates would be reviewed by CAT as well if the EMA were to consider that they also qualify as advanced therapy

medicinal products.

under the Pediatric Research Equity Act (“PREA”), in the United States, and the Paediatric Regulation, in the European

Union, the FDA or equivalent foreign regulatory authority could require mandatory testing in the pediatric population.

for approval in the United States or in the European Union must contain data to assess the safety and efficacy of the biologic

for the claimed indications in all relevant pediatric subpopulations and to support dosing and administration for each pediatric

subpopulation for which the product is safe and effective.

The FDA or equivalent foreign regulatory authority may, in its discretion,

grant full or partial waivers, or deferrals, for submission of data in pediatric subjects.

If the FDA requires data in pediatric

patients, significantly more capital will have to be invested in order to conduct the mandatory pediatric clinical trials and

studies, but the approval of the medicinal products for the adult population should normally not be affected.

If the results of

such pediatric studies are not positive, our product candidates will not be approved for children.

addition, even if we were to obtain approval, regulatory authorities may approve any of our product candidates for fewer or more

limited therapeutic indications than our requests, may include limitations for use or contraindications that limit the suitable

patient population, may not approve the price we intend to charge for our products, may grant approval contingent on the performance

of costly post-marketing clinical trials or may approve a product candidate with a label that does not include the labeling claims

necessary or desirable for the successful commercialization of that product candidate.

Any of the foregoing scenarios could materially

harm the commercial prospects for our product candidates.

we experience delays in obtaining approval or if we fail to obtain approval of our product candidates, the commercial prospects

for our product candidates may be harmed and our future ability to generate revenues will be materially impaired.

from preclinical studies of our product candidates BX001 and BX002 may not be predictive of the results of clinical trials or

later stage clinical development.

studies of our product candidates BX001 and BX002, including studies in animal disease models in the case of BX002 may not accurately

Depending on the regulatory environment

and requirements at the time BX001 is ready for market, we may decide that pursuing a drug approval (either prescription or OTC)

is the better pathway to market, in which case, it will take longer to bring BX001 to market in the United States and in other

And in this case, all other risks generally related to approval pathways would also be applicable to BX001.

Finally, even if we are permitted to market

BX001 as a cosmetic in one country, this does not guarantee that we will be permitted to market BX001 as a cosmetic in other countries.

Each country has its own distinct requirements for marketing products as cosmetics and BX001 would need to independently meet

each jurisdiction’s requirements.

We are seeking to develop product candidates to improve

the appearance of acne-prone skin and treat medical conditions related to the presence of certain bacteria.

Our success is largely

dependent on a broad degree of market acceptance, and in the case of drug products, physician adoption and use, which are necessary

for commercial success.

Even if we obtain FDA or foreign regulatory

approvals for our drug product candidates, or BX001 is permitted to be marketed as a cosmetic, the commercial success of our product

candidates will depend on consumer acceptance and adoption of products that we commercialize.

Adverse events in preclinical studies

and clinical trials of our product candidates or in clinical trials of others developing similar products and the resulting publicity

could result in a decrease in demand for any product that we may develop.

In addition, the commercial success of

our drug product candidates will depend significantly on their broad adoption and use by dermatologists, pediatricians and other

physicians for approved therapeutic indications, as well as any other indications for which we may seek approval.

certain that our approach will lead to the development of approvable or marketable products.

Obtaining high titers for specific phage cocktails necessary

for our preclinical and clinical testing may be difficult and time-consuming.

Our product candidates are phage cocktails

that we have designed to meet specific characteristics.

We and our contract manufacturers produce a cocktail of multiple phage

and it may be difficult or time-consuming to achieve high titers, or levels, of phage sufficient for our preclinical and clinical

In some cases, it may require multiple product runs in order for us to obtain the amounts necessary for its clinical

This may result in delays in our clinical trial timelines, and it may increase production costs and associated expenses.

Also, it may be difficult to reproduce the manufacturing process to the extent that more significant quantities are required as

our product candidates advance through the clinical development process.

Results from preclinical studies of our product candidates

may not be predictive of the results of clinical trials or later stage clinical development.

Preclinical studies of our product candidates,

such as BX001 and BX003, including studies in animal disease models in the case of BX003 and other studies, may not accurately

predict the safety of the product candidate such that further human clinical trials would be allowed to proceed.

2 unchanged sentences

products to address conditions in the human clinical settings.

For example, while we have studied phage activity in vitro and

in vivo, in the case of BX002, these results may not be replicated when our phage cocktails are administered to human subjects.

Despite promising data in any preclinical studies, our phage technology may be found not to be efficacious when studied in clinical

satisfy FDA or equivalent foreign regulatory approval standards, we must demonstrate safety for any cosmetic product, and we must

demonstrate in adequate and well controlled clinical trials that our drug product candidates are safe and effective for their

intended use.

Success in preclinical testing and early-stage clinical trials does not ensure that later clinical trials will be

Our initial results from preclinical testing also may not be confirmed by later analysis or subsequent larger clinical

A number of companies in the pharmaceutical industry have suffered significant setbacks in advanced clinical trials, even

after obtaining promising results in earlier clinical trials, and most product candidates that commence clinical trials are never

approved for commercial sale.

products that require regulatory approvals, we are subject to significant regulatory approval requirements, which could delay,

prevent or limit our ability to market our product candidates.

research and development activities, preclinical studies, clinical trials and the anticipated manufacturing and marketing of our

drug product candidates are subject to extensive regulation by the FDA and other regulatory agencies in the United States and

by comparable authorities in Europe and elsewhere.

To satisfy FDA or equivalent foreign regulatory approval standards, we must

demonstrate in adequate and well controlled clinical trials that our drug product candidates are safe and effective for their

intended use.

The regulatory approval process is expensive and time-consuming, and the timing of receipt of regulatory approval

is difficult to predict.

Given the uncertainties around phage therapy, our product candidates could require a significantly longer

time to gain regulatory approval than expected, or may never gain approval.

This is especially so for the product candidate designed

to treat CRC as the phage will be genetically modified, which adds potential complexity to the process, particularly in the European

We cannot be certain that, even after expending substantial time and financial resources, we will obtain regulatory approval

for any of our product candidates.

A delay or denial of regulatory approval could delay or prevent our ability to generate product

revenue and to achieve profitability.

legal and regulatory status of phage therapy remains unclear in many countries, including the European Union.

Changes in regulatory

approval policies during the development period of any of our product candidates, changes in, or the enactment of, additional

regulations or statutes, or changes in regulatory review practices for a submitted product application may cause a delay in obtaining

approval or result in the rejection of an application for regulatory approval.

approval, if obtained, may be made subject to limitations on the indicated uses for which we may market a product, as well as

the approved labeling for the product.

For example, while we have studied phage activity in vitro

and in vivo , in the case of BX003, these results may not be replicated when our phage cocktails are administered to human

Despite promising data in any preclinical studies, our phage technology may be found not to be efficacious when studied

in clinical trials.

To satisfy FDA or equivalent foreign regulatory

approval standards, we must demonstrate safety for any cosmetic product, and we must demonstrate in adequate and well controlled

clinical trials that our drug product candidates are safe and effective for their intended use.

Success in preclinical testing

and early-stage clinical trials does not ensure that later clinical trials will be successful.

Our initial results from preclinical

testing also may not be confirmed by later analysis or subsequent larger clinical trials.

A number of companies in the pharmaceutical

industry have suffered significant setbacks in advanced clinical trials, even after obtaining promising results in earlier clinical

trials, and most product candidates that commence clinical trials are never approved for commercial sale.

For products that require regulatory approvals, we are

subject to significant regulatory approval requirements, which could delay, prevent or limit our ability to market our product

Our research and development activities,

preclinical studies, clinical trials and the anticipated manufacturing and marketing of our drug product candidates are subject

to extensive regulation by the FDA and other regulatory agencies in the United States and by comparable authorities in Europe

and elsewhere.

To satisfy FDA or equivalent foreign regulatory approval standards, we must demonstrate in adequate and well controlled

clinical trials that our drug product candidates are safe and effective for their intended use.

The regulatory approval process

is expensive and time-consuming, and the timing of receipt of regulatory approval is difficult to predict.

Given the uncertainties

around phage therapy, our product candidates could require a significantly longer time to gain regulatory approval than expected

or may never gain approval.

This is especially so for the product candidate designed to treat CRC as the phage will be genetically

modified, which adds potential complexity to the process, particularly in the European Union.

We cannot be certain that, even

after expending substantial time and financial resources, we will obtain regulatory approval for any of our product candidates.

A delay or denial of regulatory approval could delay or prevent our ability to generate product revenue and to achieve profitability.

The legal and regulatory status of phage

therapy remains unclear in many countries, including the European Union.

Changes in regulatory approval policies during the development

period of any of our product candidates, changes in, or the enactment of, additional regulations or statutes, or changes in regulatory

review practices for a submitted product application may cause a delay in obtaining approval or result in the rejection of an

application for regulatory approval.

Regulatory approval, if obtained, may be

made subject to limitations on the indicated uses for which we may market a product, as well as the approved labeling for the

These limitations could adversely affect our potential product revenue.

Regulatory approval

may also be conditioned on costly post-marketing follow-up studies.

In addition, the labeling, packaging, adverse event reporting,

storage, advertising, promotion and recordkeeping related to the product will be subject to extensive ongoing regulatory requirements.

Furthermore, for any marketed product, our manufacturer and our manufacturing facilities will be subject to registration and listing

requirements and continual review and periodic inspections by the FDA or other regulatory authorities.

Failure to comply with

applicable regulatory requirements may, among other things, result in fines, suspensions of regulatory approvals, product recalls,

product seizures, operating restrictions and criminal prosecution.

we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise

adversely affected.

of clinical trials depends, among other things, on our ability to enroll a sufficient number of patients, which is a function

of many factors, including:

therapeutic endpoints chosen for evaluation;

eligibility criteria defined in the protocol;

perceived benefit of the product candidate under study;

size of the patient population required for analysis of the clinical trial’s therapeutic endpoints;

ability to recruit clinical trial investigators and sites with the appropriate competencies and experience;

ability to obtain and maintain patient consents;

for patients from clinical trials for other treatments.

may experience difficulties in enrolling patients in our clinical trials, which could increase the costs or affect the timing

Regulatory approval may also be conditioned on

costly post-marketing follow-up studies.

In addition, the labeling, packaging, adverse event reporting, storage, advertising,

promotion and recordkeeping related to the product will be subject to extensive ongoing regulatory requirements.

for any marketed product, our manufacturer and our manufacturing facilities will be subject to registration and listing requirements

and continual review and periodic inspections by the FDA or other regulatory authorities.

Failure to comply with applicable regulatory

requirements may, among other things, result in fines, suspensions of regulatory approvals, product recalls, product seizures,

operating restrictions and criminal prosecution.

If we encounter difficulties enrolling patients in our

clinical trials, our clinical development activities could be delayed or otherwise adversely affected.

Completion of clinical trials depends,

among other things, on our ability to enroll a sufficient number of patients, which is a function of many factors, including:

the therapeutic endpoints chosen for evaluation;

the eligibility criteria defined in the protocol;

the perceived benefit of the product candidate

the size of the patient population required

for analysis of the clinical trial’s therapeutic endpoints;

our ability to recruit clinical trial investigators

and sites with the appropriate competencies and experience;

our ability to obtain and maintain patient consents;

competition for patients from clinical trials

for other treatments.

We may experience difficulties in enrolling

patients in our clinical trials, including due to the impacts of COVID-19, which could increase the costs or affect the timing

or outcome of these clinical trials.

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or may not meet the entry criteria for our studies.

may not be able to initiate or continue clinical trials if it is unable to locate a sufficient number of eligible patients to

participate in the clinical trials required by the FDA or equivalent foreign regulatory agencies.

In addition, the process of

finding and diagnosing patients may prove costly.

Our inability to enroll a sufficient number of patients for any of our clinical

trials would result in significant delays or may require us to abandon one or more clinical trials.

in our clinical trials could result in us not achieving anticipated developmental milestones when expected, increased costs and

delays in our ability to obtain regulatory approval for and commercialization of our product candidates.

in our clinical trials could result in us not meeting anticipated clinical milestones and could materially impact our product

development costs and delay regulatory approval of our product candidates.

For example, we plan to initiate Phase 1 clinical trials

to explore the safety and tolerability of BX002 in 2020.

However, planned clinical trials may not be commenced or completed on

schedule, or at all.

trials can be delayed for a variety of reasons, including:

in the development of manufacturing capabilities for our product candidates to enable their consistent production at clinical

in our internal manufacturing operations that result in our inability to consistently and timely produce bacteriophages in

sufficient quantities to support our clinical trials;

availability of financial resources to commence and complete our planned clinical trials;

in reaching a consensus with clinical investigators on study design;

in reaching a consensus with regulatory agencies on trial design or in obtaining regulatory approval to commence a trial;

in obtaining clinical materials;

than expected patient recruitment for participation in clinical trials;

constraints or injunctions (for example, from supervisory authorities in case of noncompliance with cybersecurity and data

privacy laws);

by clinical trial sites, other third parties or us to adhere to clinical trial agreements;

in reaching agreement on acceptable clinical trial agreement terms with prospective sites or obtaining institutional review

board approval;

safety events experienced during our clinical trials.

we do not successfully commence or complete our clinical trials on schedule, the price of our Common Stock may decline.

preclinical or clinical trial delays could shorten any periods during which we may have the exclusive right to commercialize our

product candidates or allow our competitors to bring products to market before we do, potentially impairing our ability to successfully

commercialize our product candidates and harming our business and results of operations.

current or future product candidates may cause adverse effects that could halt their clinical development, prevent their approval

or marketing, limit their commercial potential or result in significant negative consequences.

effects could occur and cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more

restrictive label or the delay or denial of marketing approval by the FDA or equivalent foreign regulatory agencies.

such adverse effects would prevent marketing BX001 as a cosmetic.

Results of our trials could reveal a high and unacceptable severity

and prevalence of side effects or unexpected characteristics.

adverse effects arise in the development of our product candidates, we, the FDA or equivalent foreign regulatory agencies, the

Institutional Review Boards (“IRBs”) or independent ethics committees at the institutions in which our studies are

conducted, or the Data Safety Monitoring Board (“DSMB”) could suspend or terminate our clinical trials or the FDA

or equivalent foreign regulatory agencies could deny approval of our product candidates for any or all targeted indications.

events in studies with BX001 as a cosmetic may lead us to stop our marketing.

intend to evaluate our product candidates for safety and tolerability in the form of Phase 1 clinical trials.

None of our product

candidates have completed this testing to date, and we have initiated the first human studies of BX001 in November 2019.

our current and future product candidates will undergo safety testing to the extent possible and, where applicable, under such

conditions discussed with regulatory authorities, not all adverse effects of drugs can be predicted or anticipated.

adverse effects could arise either during clinical development or, if such adverse effects are more rare, after our products have

been approved by regulatory authorities and the approved product has been marketed, resulting in the exposure of additional patients.

For example, while we screen our phages in attempts to minimize safety issues, there can be no assurance that we will eliminate

the risk of the appearance of virulence genes, antibiotic resistance genes, lysogenic genes, integrase genes, or other toxic genes

in our phages, or of adverse reactions to our phages in a patient’s immune system.

So far, we have not demonstrated, and

we cannot predict, if ongoing or future clinical trials will demonstrate that any of our product candidates are safe in humans.

Moreover, clinical trials of our product candidates are conducted in carefully defined sets of patients who have agreed to enter

into clinical trials.

Consequently, it is possible that our clinical trials may indicate an apparent positive effect of a product

candidate that is greater than the actual positive effect, if any, or alternatively fail to identify undesirable adverse effects.

some or all of our product candidates may prove to be unsafe for human use.

Moreover, we could be subject to significant liability

if any volunteer or patient suffers, or appears to suffer, adverse health effects as a result of participating in our clinical

Any of these events could prevent us from achieving or maintaining market acceptance of our product candidates and could

substantially increase commercialization costs.

have not completed composition development of our product candidates.

development of our product candidates requires that we isolate, select, optimize and combine a number of phages that target the

desired bacteria for that product candidate.

The selection of phages for any of our product candidates is based on a variety of

factors, including, without limitation, the ability of the selected phages, in combination, to successfully kill the targeted

bacteria, the degree of cross-reactivity of the individual phages with the same part of the bacterial targets, the ability of

the combined phages to satisfy regulatory requirements, our ability to manufacture sufficient quantities of the phages, intellectual

property rights of third parties, and other factors.

While we have selected initial formulations of BX001 and BX002, there can

be no assurance that these initial formulations will be the final formulations of these product candidates for commercialization

If we are unable to complete formulation development of our product candidates in the time frame that we have anticipated,

then our product development time lines, and the regulatory approval of our product candidates, could be delayed.

must continue to develop manufacturing processes for our product candidates, and any delay in doing so, or our inability to do

so, would result in delays in our clinical trials.

manufacturing processes for our product candidates, and the scale-up of such processes for clinical trials, may present challenges,

and there can be no assurance that we will be able to complete this work in a timely manner, if at all.

Any delay in the development

or scale-up of these manufacturing processes could delay the start of clinical trials and harm our business.

In order to scale-up

our manufacturing capacity, we need to either build additional internal manufacturing capacity, contract with one or more partners,

Our technology and the production process for our equipment and tools are complex and we may encounter unexpected difficulties

in manufacturing our product candidates.

For example, the manufacturing hosts that we use to produce our phages may contain one

or more integrated phages in their genomes that, if we are unable to remove, can present challenges in manufacturing of the produced

There is no assurance that we will be able to continue to build manufacturing capacity internally or find one or more

suitable partners, or both, to meet the necessary volume and quality requirements.

Manufacturing and product quality issues may

arise as we increase the scale of our production.

Any delay or inability in establishing or expanding our manufacturing capacity

could diminish our ability to develop our product candidates.

the third quarter of 2019, we opened our own current Good Manufacturing Process (“cGMP”) manufacturing facility at

its headquarters in Ness Ziona, Israel.

Our facility must undergo ongoing inspections for compliance with cGMP regulations before

the respective product candidates can be approved for use in clinical trials or commercialization.

We may not be able to initiate or continue

clinical trials if we are unable to locate a sufficient number of eligible patients to participate in the clinical trials required

by the FDA or equivalent foreign regulatory agencies.

In addition, the process of finding and diagnosing patients may prove costly.

Our inability to enroll a sufficient number of patients for any of our clinical trials would result in significant delays or may

require us to abandon one or more clinical trials.

Delays in our clinical trials could result in us not

achieving anticipated developmental milestones when expected, increased costs and delays in our ability to obtain regulatory approval

for and commercialization of our product candidates.

Delays in our clinical trials could result

in us not meeting anticipated clinical milestones and could materially impact our product development costs and delay regulatory

approval of our product candidates.

Planned clinical trials may not be commenced or completed on schedule, or at all.

Clinical trials can be delayed for a variety

of reasons, including:

delays in the development of manufacturing capabilities

for our product candidates to enable their consistent production at clinical trial scale;

failures in our internal manufacturing operations

that result in our inability to consistently and timely produce bacteriophages in sufficient quantities to support our clinical

the availability of financial resources to commence

and complete our planned clinical trials;

delays in reaching a consensus with clinical

investigators on study design;

delays in reaching a consensus with regulatory

agencies on trial design or in obtaining regulatory approval to commence a trial;

delays in obtaining clinical materials;

slower than expected patient recruitment for

participation in clinical trials;

regulatory constraints or injunctions (for example,

from supervisory authorities in case of noncompliance with cybersecurity and data privacy laws);

failure by clinical trial sites, other third

parties or us to adhere to clinical trial agreements;

delays in reaching agreement on acceptable clinical

trial agreement terms with prospective sites or obtaining IRB approval;

adverse safety events experienced during our

clinical trials.

If we do not successfully commence or complete

our clinical trials on schedule, the price of our securities may decline.

Significant preclinical or clinical trial delays could

shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors

to bring products to market before we do, potentially impairing our ability to successfully commercialize our product candidates

and harming our business and results of operations.

Our current or future product candidates may cause adverse

effects that could halt their clinical development, prevent their approval or marketing, limit their commercial potential or result

in significant negative consequences.

Adverse effects could occur and cause us

or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay

or denial of marketing approval by the FDA or equivalent foreign regulatory agencies.

Similarly, such adverse effects would prevent

marketing BX001 as a cosmetic.

Results of our trials could reveal a high and unacceptable severity and prevalence of side effects

or unexpected characteristics.

If adverse effects arise in the development

of our product candidates, we, the FDA or equivalent foreign regulatory agencies, the IRBs or independent ethics committees at

the institutions in which our studies are conducted, or the Data Safety Monitoring Board could suspend or terminate our clinical

trials or the FDA or equivalent foreign regulatory agencies could deny approval of our product candidates for any or all targeted

Adverse events in studies with BX001 as a cosmetic may lead us to stop our marketing.

We intend to continue to evaluate our product

candidates for safety and tolerability in the form of Phase 1 clinical trials.

While our current and future product candidates

will undergo safety testing to the extent possible and, where applicable, under such conditions discussed with regulatory authorities,

not all adverse effects of drugs can be predicted or anticipated.

Unforeseen adverse effects could arise either during clinical

development or, if such adverse effects are more rare, after our products have been approved by regulatory authorities and the

approved product has been marketed, resulting in the exposure of additional patients.

For example, while we screen our phage in

attempts to minimize safety issues, there can be no assurance that we will eliminate the risk of the appearance of virulence genes,

antibiotic resistance genes, lysogenic genes, integrase genes, or other toxic genes in our phage, or of adverse reactions to our

phage in a patient’s immune system.

So far, we have not demonstrated, and we cannot predict, if ongoing or future clinical

trials will demonstrate that any of our product candidates are safe in humans.

Moreover, clinical trials of our product candidates

are conducted in carefully defined sets of patients who have agreed to enter into clinical trials.

Consequently, it is possible

that our clinical trials may indicate an apparent positive effect of a product candidate that is greater than the actual positive

effect, if any, or alternatively fail to identify undesirable adverse effects.

Ultimately, some or all of our product

candidates may prove to be unsafe for human use.

Moreover, we could be subject to significant liability if any volunteer or patient

suffers, or appears to suffer, adverse health effects as a result of participating in our clinical trials.

Any of these events

could prevent us from achieving or maintaining market acceptance of our product candidates and could substantially increase commercialization

We have not completed composition development of our

product candidates.

The development of our product candidates requires that we isolate,

select, optimize and combine a number of phage that target the desired bacteria for that product candidate.

The selection of phage

for any of our product candidates is based on a variety of factors, including, without limitation, the ability of the selected

phage, in combination, to successfully kill the targeted bacteria, the degree of cross-reactivity of the individual phage with

the same part of the bacterial targets, the ability of the combined phage to satisfy regulatory requirements, our ability to manufacture

sufficient quantities of the phage, intellectual property rights of third parties, and other factors.

While we have selected initial

formulations of BX001 and BX003, there can be no assurance that these initial formulations will be the final formulations of these

product candidates for commercialization if approved.

If we are unable to complete formulation development of our product candidates

in the time frame that we have anticipated, then our product development timelines, and the regulatory approval of our product

candidates, could be delayed.

We must continue to develop manufacturing processes for

our product candidates, and any delay in doing so, or our inability to do so, would result in delays in our clinical trials.

The manufacturing processes for our product

candidates, and the scale-up of such processes for clinical trials, may present challenges, and there can be no assurance that

we will be able to complete this work in a timely manner, if at all.

Any delay in the development or scale-up of these manufacturing

processes could delay the start of clinical trials and harm our business.

In order to scale-up our manufacturing capacity, we need

to either build additional internal manufacturing capacity, contract with one or more partners, or both.

Our technology and the

production process for our equipment and tools are complex and we may encounter unexpected difficulties in manufacturing our product

For example, the manufacturing hosts that we use to produce our phage may contain one or more integrated phage in their

genomes that, if we are unable to remove, can present challenges in manufacturing of the produced phage.

There is no assurance

that we will be able to continue to build manufacturing capacity internally or find one or more suitable partners, or both, to

meet the necessary volume and quality requirements.

Manufacturing and product quality issues may arise as we increase the scale

of our production.

Any delay or inability in establishing or expanding our manufacturing capacity could diminish our ability to

develop our product candidates.

In the third quarter of 2019, we established

our own current cGMP manufacturing facility at our headquarters in Ness Ziona, Israel and we have executed cGMP manufacturing

for our first in human clinical study (IBD project).

Our facility undergoes ongoing inspections for compliance with cGMP regulations

before the respective product candidates are approved for use in clinical trials or commercialization.

In the event this facility

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any of which would result in significant cost to us as well as a delay of up to several years in obtaining approval for such product

manufacturing facility will be subject to ongoing periodic inspection for compliance with European, FDA and cGMP regulations.

Compliance with these regulations and standards is complex and costly, and there can be no assurance that we will be able to comply.

Any failure to comply with applicable regulations could result in sanctions being imposed (including fines, injunctions and civil

penalties), failure of regulatory authorities to grant marketing approval of our product candidates, delays, suspension or withdrawal

of approvals, license revocation, seizures or recalls of product candidates or products, operating restrictions and criminal prosecution.

our competitors are able to develop and market products that are more effective, safer or more affordable than ours, or obtain

marketing approval before we do, our commercial opportunities may be limited.

in the biotechnology and pharmaceutical industries is intense and continues to increase.

Some companies that are larger and have

significantly more resources than us are aggressively pursuing development programs for indications that we are pursuing, including

traditional therapies and therapies with novel mechanisms of action.

In addition, other companies are developing phage-based products

for therapeutic and non-therapeutic uses, and may elect to use their expertise in phage development and manufacturing to try to

develop products that would compete with our products.

also face potential competition from academic institutions, government agencies and private and public research institutions engaged

in the discovery and development of drugs and therapies.

Many of our competitors have significantly greater financial resources

and expertise in research and development, preclinical testing, conducting clinical trials, obtaining regulatory approvals, manufacturing,

sales and marketing than we do.

Smaller or early-stage companies may also prove to be significant competitors, particularly through

collaborative arrangements with large and established pharmaceutical companies.

the European Union, potential competition also comes from medicinal preparations made by hospitals or pharmacists and administered

without marketing authorizations, generally referred to as “compounding.”

In some member states, national authorities

generally promote compounding in order to reduce healthcare expenses.

competitors may succeed in developing products that are more effective, have fewer side effects and are safer or more affordable

than our product candidates, which would render our product candidates less competitive or noncompetitive and would prevent the

granting or maintenance of an orphan designation.

These competitors also compete with us to recruit and retain qualified scientific

and management personnel, establish clinical trial sites and patient registration for clinical trials, as well as to acquire technology

and technology licenses complementary to our programs or advantageous to our business.

Moreover, competitors that are able to

achieve patent protection, obtain regulatory approvals and commence commercial sales of their products before we do, and competitors

that have already done so may enjoy a significant competitive advantage.

faces significant competition in the market.

facial aesthetic market is highly competitive and dynamic, and is characterized by rapid and substantial technological development

and product innovations.

If BX001 can be marketed as a cosmetic, we may face significant competition from other facial aesthetic

Due to less stringent regulatory requirements, there are many more possibilities for marketing cosmetics in international

markets than there are in the United States.

There are also fewer limitations on the claims that our competitors in international

markets can make about the effectiveness of their products and the manner in which they can market them.

As a result, if we partner

with other companies in these markets and launch our products, we may face more competition in these markets than in the United

requirements as well as ethical and social concerns about synthetic biology and genetic engineering could limit or prevent the

use of our technologies and limit our revenues.

technology may include the use of synthetic biology and genetic engineering.

In some countries, drugs made using genetically modified

organisms may be subject to a more stringent legal regime, which could prove to be complex and very challenging, especially for

a small life sciences company.

For example, in the European Union, the rules on genetically modified organisms would apply in

addition to the general rules on medicinal products or cosmetic products.

The rules on advanced therapy medicinal products may

Additionally,

public perception about the safety and environmental hazards of, and ethical concerns over, synthetic biology and genetic engineering

could influence public acceptance of our technologies, product candidates and processes.

If we and our collaborators are not able

to overcome the legal challenges as well as the ethical and social concerns relating to synthetic biology and genetic engineering,

our technologies, product candidates and processes may not be accepted.

These challenges and concerns could result in increased

expenses, regulatory scrutiny and increased regulation, trade restrictions on imports of our product candidates, delays or other

impediments to our programs or the public acceptance and commercialization of our products.

We design and produce product candidates

with characteristics comparable or superior to those found in naturally occurring organisms or enzymes in a controlled laboratory;

however, the release of such organisms into uncontrolled environments could have unintended consequences.

Any adverse effect resulting

from such a release could have a material adverse effect on our business, financial condition or results of operations, and we

may have exposure to liability for any resulting harm.

may not be successful in our efforts to identify or discover additional product candidates.

we intend to utilize our technology to evaluate other therapeutic opportunities in addition to the product candidates that we

are currently developing, we may fail to identify other product candidates for clinical development for a number of reasons.

example, our research methodology may not be successful in identifying potential product candidates, or those we identify may

be shown to have harmful side effects or other characteristics that make them unmarketable or unlikely to receive regulatory approval.

In addition, we may not be able to identify phages that eradicate the target bacteria, including due to sourcing difficulties

such as lack of diversity, inability to obtain samples in a timely manner or at all, or contamination in the samples.

encounter difficulties in designing phage cocktails that meet the requirements of an investigational therapy, including due to

the build-up of resistances in bacteria to our phages, the range of host bacteria that are affected by our phages, the variety

of activity on different bacteria growth states, issues with toxicity in our phages, and the stability, robustness and ease of

manufacturing of our product candidates.

In addition, the designing of synthetically engineered phages may fail to result in the

development of phages with the desired characteristics or behaviors that are suitable for use as viable therapies, or may result

in phages that contain undesired features such as immunogenicity, toxicity and other safety concerns.

key part of our strategy is to utilize our screening technology to identify product candidates to pursue in clinical development.

If we fail to identify and develop additional potential product candidates, we may be unable to grow our business and our results

of operations could be materially harmed.

Such product candidates will require additional, time-consuming development efforts

prior to commercial sale, including preclinical studies, clinical trials and approval by the FDA and/or applicable foreign regulatory

All product candidates are prone to the risks of failure that are inherent in pharmaceutical product development.

may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates

or indications that may be more profitable or for which there is a greater likelihood of success.

we have limited financial and managerial resources, we intend to focus on developing product candidates for specific indications

that we identify as most likely to succeed, in terms of both their potential for marketing approval and commercialization.

a result, we may forego or delay pursuit of opportunities with other product candidates or for other indications that may prove

to have greater commercial potential.

resource allocation decisions may cause us to fail to capitalize on viable commercial products or profitable market opportunities.

Our spending on current and future research and development programs and product candidates for specific indications may not yield

any commercially viable product candidates.

If we do not accurately evaluate the commercial potential or target market for a particular

product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty

arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights

to the product candidate.

success depends, in part, on our ability to retain key executives and to attract, retain and motivate qualified personnel.

are highly dependent on Jonathan Solomon, our chief executive officer, as well as the other principal members of our management,

scientific and clinical team.

Although we have entered into employment agreements with our executive officers, each of them may

terminate their employment with us at any time.

We do not maintain “key person”

insurance for any of our executives

or other employees.

The loss of the services of any of our executive officers, other key employees, and other scientific and medical

advisors, and our inability to find suitable replacements could result in delays in product development and harm our business.

continued ability to attract, retain and motivate highly qualified management, clinical and scientific personnel and our ability

to develop and maintain important relationships with leading academic institutions, clinicians and scientists is critical to our

Competition for qualified personnel in the biotechnology field is intense, particularly in Israel where our headquarters

We face competition for personnel from other biotechnology and pharmaceutical companies, universities, public and

private research institutions and other organizations.

We also face competition from other more well-funded and well-established

businesses, and we may also be viewed as a riskier choice from a job stability perspective due to our relatively newer status

than longer existing biotech and pharmaceutical companies.

We may not be able to attract and retain qualified personnel on acceptable

terms given the competition for such personnel.

If we are unsuccessful in our retention, motivation and recruitment efforts, we

may be unable to execute our business strategy.

is a substantial risk of product liability claims in our business.

If we do not obtain sufficient liability insurance, a product

liability claim could result in substantial liabilities to us.

business exposes us to significant potential product liability risks that are inherent in the development, manufacturing and marketing

of human therapeutic products.

manufacturing facility will be subjected to ongoing periodic inspection for compliance with European, FDA and cGMP regulations

as progress will be made in clinical phases.

Compliance with these regulations and standards is complex and costly, and there

can be no assurance that we will be able to comply.

Any failure to comply with applicable regulations could result in sanctions

being imposed (including fines, injunctions and civil penalties), failure of regulatory authorities to grant marketing approval

of our product candidates, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of product candidates

or products, operating restrictions and criminal prosecution.

If our competitors are able to develop and market products

that are more effective, safer or more affordable than ours, or obtain marketing approval before we do, our commercial opportunities

may be limited.

Competition in the biotechnology and pharmaceutical

industries is intense and continues to increase.

Some companies that are larger and have significantly more resources than us

are aggressively pursuing development programs for indications that we are pursuing, including traditional therapies and therapies

with novel mechanisms of action.

In addition, other companies are developing phage-based products for therapeutic and non-therapeutic

uses, and may elect to use their expertise in phage development and manufacturing to try to develop products that would compete

with our products.

We also face potential competition from

academic institutions, government agencies and private and public research institutions engaged in the discovery and development

of drugs and therapies.

Many of our competitors have significantly greater financial resources and expertise in research and development,

preclinical testing, conducting clinical trials, obtaining regulatory approvals, manufacturing, sales and marketing than we do.

Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements

with large and established pharmaceutical companies.

In the European Union, potential competition

also comes from medicinal preparations made by hospitals or pharmacists and administered without marketing authorizations, generally

referred to as “compounding.”

In some member states, national authorities generally promote compounding in order to

reduce healthcare expenses.

Our competitors may succeed in developing

products that are more effective, have fewer side effects and are safer or more affordable than our product candidates, which

would render our product candidates less competitive or noncompetitive and would prevent the granting or maintenance of an orphan

These competitors also compete with us to recruit and retain qualified scientific and management personnel, establish

clinical trial sites and patient registration for clinical trials, as well as to acquire technology and technology licenses complementary

to our programs or advantageous to our business.

Moreover, competitors that are able to achieve patent protection, obtain regulatory

approvals and commence commercial sales of their products before we do, and competitors that have already done so may enjoy a

significant competitive advantage.

BX001 faces significant competition in the market.

The facial aesthetic market is highly competitive

and dynamic, and is characterized by rapid and substantial technological development and product innovations.

If BX001 can be

marketed as a cosmetic, we may face significant competition from other facial aesthetic products.

Due to less stringent regulatory

requirements, there are many more possibilities for marketing cosmetics in international markets than there are in the United

There are also fewer limitations on the claims that our competitors in international markets can make about the effectiveness

of their products and the manner in which they can market them.

As a result, if we partner with other companies in these markets

and launch our products, we may face more competition in these markets than in the United States.

Legal requirements as well as ethical and social concerns

about synthetic biology and genetic engineering could limit or prevent the use of our technologies and limit our revenues.

Our technology may include the use of synthetic

biology and genetic engineering.

In some countries, drugs made using genetically modified organisms may be subject to a more stringent

legal regime, which could prove to be complex and very challenging, especially for a small life sciences company.

in the European Union, the rules on genetically modified organisms would apply in addition to the general rules on medicinal products

or cosmetic products.

The rules on advanced therapy medicinal products may also apply.

Additionally, public perception about the

safety and environmental hazards of, and ethical concerns over, synthetic biology and genetic engineering could influence public

acceptance of our technologies, product candidates and processes.

If we and our collaborators are not able to overcome the legal

challenges as well as the ethical and social concerns relating to synthetic biology and genetic engineering, our technologies,

product candidates and processes may not be accepted.

These challenges and concerns could result in increased expenses, regulatory

scrutiny and increased regulation, trade restrictions on imports of our product candidates, delays or other impediments to our

programs or the public acceptance and commercialization of our products.

We design and produce product candidates with characteristics

comparable or superior to those found in naturally occurring organisms or enzymes in a controlled laboratory;

however, the release

of such organisms into uncontrolled environments could have unintended consequences.

Any adverse effect resulting from such a

release could have a material adverse effect on our business, financial condition or results of operations, and we may have exposure

to liability for any resulting harm.

We may not be successful in our efforts to identify or

discover additional product candidates.

Although we intend to utilize our technology to evaluate other

therapeutic opportunities in addition to the product candidates that we are currently developing, we may fail to identify other

product candidates for clinical development for a number of reasons.

For example, our research methodology may not be successful

in identifying potential product candidates, or those we identify may be shown to have harmful side effects or other characteristics

that make them unmarketable or unlikely to receive regulatory approval.

In addition, we may not be able to identify phage that

eradicate the target bacteria, including due to sourcing difficulties such as lack of diversity, inability to obtain samples in

a timely manner or at all, or contamination in the samples.

We may also encounter difficulties in designing phage cocktails that

meet the requirements of an investigational therapy, including due to the build-up of resistances in bacteria to our phage, the

range of host bacteria that are affected by our phage, the variety of activity on different bacteria growth states, issues with

toxicity in our phage, and the stability, robustness and ease of manufacturing of our product candidates.

In addition, the designing

of synthetically engineered phage may fail to result in the development of phage with the desired characteristics or behaviors

that are suitable for use as viable therapies, or may result in phage that contain undesired features such as immunogenicity, toxicity

and other safety concerns.

A key part of our strategy is to utilize

our screening technology to identify product candidates to pursue in clinical development.

If we fail to identify and develop

additional potential product candidates, we may be unable to grow our business and our results of operations could be materially

Such product candidates will require additional, time-consuming development efforts prior to commercial sale, including

preclinical studies, clinical trials and approval by the FDA and/or applicable foreign regulatory agencies.

All product candidates

are prone to the risks of failure that are inherent in pharmaceutical product development.

We intend to rely on our new BOLT (BacteriOphage Lead

to Treatment) proprietary product platform to develop our phage therapies.

Our competitive position could be materially harmed

if our competitors develop similar platforms and develop rival product candidates.

Our new BOLT platform enables us to rapidly

develop, manufacture and formulate phage therapy candidates targeting particular pathogenic bacteria and incorporates our experience

over the past six years with process refinement and implementation of technological advancements.

For a given indication, the

platform will allow for the completion of a clinical proof of concept study in patients, meaning Phase 2 results, within approximately

12-18 months from project initiation;

however in certain indications the length of clinical proof of concept may be longer depending

on the indication, identity of target bacteria, recruitment rate, cohort size and other factors.

We are initially implementing

the ability to complete a clinical proof of concept study in patients within approximately 12-18 months from project initiation

in our cystic fibrosis and atopic dermatitis programs.

Our BOLT platform is new and may not achieve the benefits we anticipate.

To the extent we utilize our resources to further develop our BOLT platform, we may become more dependent on its success.

We may expend our limited resources to pursue a particular

product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for

which there is a greater likelihood of success.

Because we have limited financial and managerial

resources, we intend to focus on developing product candidates for specific indications that we identify as most likely to succeed,

in terms of both their potential for marketing approval and commercialization.

As a result, we may forego or delay pursuit of

opportunities with other product candidates or for other indications that may prove to have greater commercial potential.

Our resource allocation decisions may cause

us to fail to capitalize on viable commercial products or profitable market opportunities.

Our spending on current and future

research and development programs and product candidates for specific indications may not yield any commercially viable product

If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we

may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases

in which it would have been more advantageous for us to retain sole development and commercialization rights to the product candidate.

There is a substantial risk of product liability claims

in our business.

If we do not obtain sufficient liability insurance, a product liability claim could result in substantial liabilities

Our business exposes us to significant

potential product liability risks that are inherent in the development, manufacturing and marketing of human therapeutic products.

Regardless of merit or eventual outcome, product liability claims may result in:

or failure to complete our clinical trials;

of clinical trial participants;

demand for our product candidates;

to our reputation;

monetary awards against us;

of management or other resources from key aspects of our operations.

we succeed in marketing products, product liability claims could result in an FDA or equivalent foreign regulatory agency investigation

of the safety or efficacy of our products, our manufacturing processes and facilities or our marketing programs.

Such investigation

could also potentially lead to a recall of our products or more serious enforcement actions, or limitations on the indications,

for which they may be used, or suspension or withdrawal of approval.

have clinical trial insurance that covers our clinical trial for up to a $3.0 million annual per claim and aggregate limit.

addition, we have a specific clinical trial insurance that covers our clinical trials in BX001 up to EUR 5 million aggregate limit.

We intend to expand our insurance coverage to include the sale of commercial products if marketing approval is obtained for our

product candidates or any other compound that we may develop.

However, insurance coverage is expensive, and we may not be able

to maintain insurance coverage at a reasonable cost or at all, and the insurance coverage that we obtain may not be adequate to

cover potential claims or losses.

to comply with health and data protection laws and regulations could lead to claims, government enforcement actions (which could

include civil or criminal penalties), regulatory actions, private litigation and/or adverse publicity and could negatively affect

our operating results and business.

may be subject to federal, state and foreign data protection laws and regulations (i.e., laws and regulations that address privacy

and security).

In the United States, numerous federal and state laws and regulations, including federal health information privacy

laws, state consumer privacy laws, state data breach notification laws, state health information privacy laws and federal and

state consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), that govern the collection, use, disclosure

and protection of health-related and other personal information could apply to our operations or the operations of our collaborators.

In addition, we may obtain health information from third parties (including research institutions from which we obtain clinical

trial data) that are subject to privacy and security requirements under the HIPAA (as defined below), as amended by HITECH (as

defined below).

Depending on the facts and circumstances, We could be subject to criminal penalties if we knowingly obtain, use

or disclose individually identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized

or permitted by HIPAA.

requirements may also be imposed by international data protection laws.

In this context, Regulation 2016/679, the General Data

Protection Regulation (the “GDPR”) (in addition to many other international data protection laws) may have an impact

on our operations when we collect and/or process personal data of individuals located in the European Union.

The GDPR has applied

since May 25, 2018 (replacing previously applicable data protection frameworks) and has an extraterritorial reach.

The GDPR allows

members states to introduce specific requirements in relation to certain areas, including processing of special categories of

data, and we may face further restrictions and non-compliance risks under such national frameworks.

We have not yet assessed whether

its activities might be caught by the GDPR.

of the types of data we collect and process, which may involve health, biometric and genetic data, we may face high risks for

non-compliance with the GDPR rules (or local declinations of GDPR-rules across the different European Union Member States), as

these types of data are considered as special categories of data and are granted higher protection.

The risks are further increased

considering the diverging approach in the European Union as to the rules, requirements and frameworks in relation to the processing

of personal data in clinical trials (in matters such as the choice of the legal basis for the processing of data, the possible

uses of the personal data collected, etc.) and the interplay with other relevant frameworks.

The GDPR introduced stringent data

protection requirements in the European Union, as well as potential fines for noncompliant companies of up to the greater of €20

million or 4% of annual worldwide turnover.

Supervisory authorities also have the ability to restrict our processing activities

if those are deemed not to be in compliance with the GDPR (or local declinations);

this may significantly impact the way we conduct

our activities.

The GDPR imposes numerous requirements for the collection, use and disclosure of personal data, including high

standards for consent to be valid, and specific information to be provided to individuals about how their personal data is used,

the obligation to notify regulators and (in some cases) to communicate to affected individuals of personal data breaches, extensive

new internal privacy governance requirements and obligations to allow individuals to exercise their strengthened privacy rights

(e.g., the right to access, correct and delete their personal data, to withdraw their consent, etc.), and obligations when contracting

with third parties such as service provides, CROs, etc.

In addition, the GDPR includes restrictions on data transfers outside

the European Economic Area (“EEA”).

The actual mechanisms made available under GDPR to transfer such personal data

have recently received heightened regulatory and judicial scrutiny.

If we cannot rely on existing mechanisms for transferring

personal data from the EEA, the United Kingdom, or other jurisdictions, we may be unable to transfer personal data in those regions.

Further, the United Kingdom’s vote in favor of exiting the European Union, often referred to as “Brexit,”

created uncertainty as to whether or not the United Kingdom data protection legislation will depart from the GDPR and how data

transfers to and from the United Kingdom will be regulated.

and international data protection laws and regulations could require us to take on more onerous obligations in our contracts,

restrict our ability to collect, use and disclose data, or in some cases, impact our ability to operate in certain jurisdictions.

Such laws and regulations could limit our ability to use and share personal or other data, thereby increasing our costs and harming

our business and financial condition.

Failure to comply with U.S.

and international data protection laws and regulations could

result in claims, government enforcement actions (which could include civil or criminal penalties), regulatory actions, private

litigation and/or adverse publicity and could negatively affect our operating results and business.

Moreover, clinical trial subjects

about whom we or our potential collaborators obtain information, as well as the providers who share this information with us,

may contractually limit our ability to use and disclose the information.

Claims that we have violated individuals’

rights, failed to comply with data protection laws, or breached our contractual obligations, even if we are not found liable,

could be expensive and time consuming to defend and could result in adverse publicity that could harm our business.

may be required to disclose personal data pursuant to demands from government agencies, from law enforcement agencies, and from

intelligence agencies.

This disclosure may result in a failure or perceived failure by us to comply with data privacy laws, rules,

and regulations and could result in proceedings or actions against us in the same or other jurisdictions, and could have an adverse

impact on our reputation and brand.

business and operations might be adversely affected by security breaches, including any cybersecurity incidents.

depend on the efficient and uninterrupted operation of our computer and communications systems, and those of our consultants,

contractors and vendors, which we use for, among other things, sensitive company data, including our intellectual property, financial

data and other proprietary business information.

certain of our operations have business continuity and disaster recovery plans and other security measures intended to prevent

and minimize the impact of IT-related interruptions, our IT infrastructure and the IT infrastructure of our consultants, contractors

and vendors are vulnerable to damage from cyberattacks, computer viruses, unauthorized access, electrical failures and natural

disasters or other catastrophic events.

We could experience failures in our information systems and computer servers, which could

result in an interruption of our normal business operations and require substantial expenditure of financial and administrative

resources to remedy.

System failures, accidents or security breaches can cause interruptions in our operations and can result

in a material disruption of our targeted phage therapies, product candidates and other business operations.

The loss of data from

completed or future studies or clinical trials could result in delays in our research, development or regulatory approval efforts

and significantly increase our costs to recover or reproduce the data.

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 confidential or proprietary information,

we could incur regulatory investigations and redresses, penalties and liabilities and the development of our product candidates

could be delayed or otherwise adversely affected.

though we believe we carry commercially reasonable business interruption and liability insurance, we might suffer losses as a

result of business interruptions that exceed the coverage available under our insurance policies or for which we do not have coverage.

For example, we are not insured against terrorist attacks or cyberattacks.

Any natural disaster or catastrophic event could have

a significant negative impact on our operations and financial results.

Moreover, any such event could delay the development of

our product candidates.

employees, independent contractors, consultants, commercial partners and vendors may engage in misconduct or other improper activities,

including noncompliance with regulatory standards and requirements.

are exposed to the risk of employee fraud or other illegal activity by our employees, independent contractors, consultants, commercial

partners and vendors.

Misconduct by these parties could include intentional, reckless and/or negligent conduct that fails to comply

with the laws of the FDA and other similar foreign regulatory bodies, provide true, complete and accurate information to the FDA

and other similar foreign regulatory bodies, comply with manufacturing standards we have established, comply with healthcare fraud

and abuse laws in the United States and similar foreign fraudulent misconduct laws or report financial information or data accurately

or to disclose unauthorized activities to us.

If we obtain FDA approval of any of our product candidates and begin commercializing

those products in the United States, our potential exposure under such laws will increase significantly, and our costs associated

with compliance with such laws are also likely to increase.

These laws may impact, among other things, our current activities

with principal investigators and research patients, as well as proposed and future sales, marketing and education programs.

relationships with healthcare providers, physicians and third-party payors will be subject to applicable anti-kickback, fraud

and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual

damages, reputational harm and diminished profits and future earnings.

providers, physicians and third-party payors in the United States and elsewhere play a primary role in the recommendation and

prescription of pharmaceutical products.

Arrangements with third-party payors and customers can expose pharmaceutical manufacturers

to broadly applicable fraud and abuse and other healthcare laws and regulations, including, without limitation, the federal Anti-Kickback

Statute and the federal False Claims Act (“FCA”) and foreign equivalent legislation, which may constrain the business

or financial arrangements and relationships through which such companies sell, market and distribute pharmaceutical products.

In particular, the promotion, sales and marketing of healthcare items and services, as well as certain business arrangements in

the healthcare industry, are subject to extensive laws designed to prevent fraud, kickbacks, self-dealing and other abusive practices.

These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, structuring

and commissions, certain customer incentive programs and other business arrangements generally.

Activities subject to these laws

also involve the improper use of information obtained in the course of patient recruitment for clinical trials.

The applicable

federal, state and foreign healthcare laws and regulations laws that may affect our ability to operate include, but are not limited

federal Anti-Kickback Statute, which prohibits, among other things, knowingly and willfully soliciting, receiving, offering

or paying any remuneration (including any kickback, bribe or rebate), directly or indirectly, overtly or covertly, in cash

or in kind, to induce, or in return for, either the referral of an individual, or the purchase, lease, order or recommendation

of any good, facility, item or service for which payment may be made, in whole or in part, under a federal healthcare program,

such as the Medicare and Medicaid programs.

A person or entity can be found guilty of violating the statute without actual

knowledge of the statute or specific intent to violate it.

In addition, 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 FCA.

The Anti-Kickback

Statute has been interpreted to apply to arrangements between pharmaceutical manufacturers on the one hand and prescribers,

purchasers and formulary managers on the other hand.

There are a number of statutory exceptions and regulatory safe harbors

protecting some common activities from prosecution;

civil and criminal false claims laws and civil monetary penalty laws, including the FCA, which prohibit, among other things,

individuals or entities from knowingly presenting, or causing to be presented, false or fraudulent claims for payment to,

or approval by Medicare, Medicaid or other federal healthcare programs, knowingly making, using or causing to be made or used

a false record or statement material to a false or fraudulent claim or an obligation to pay or transmit money to the federal

government, or knowingly concealing or knowingly and improperly avoiding or decreasing or concealing an obligation to pay

money to the federal government.

Manufacturers can be held liable under the FCA even when they do not submit claims directly

to government payors if they are deemed to “cause”

the submission of false or fraudulent claims.

permits a private individual acting as a “whistleblower”

to bring actions on behalf of the federal government

alleging violations of the FCA and to share in any monetary recovery;

which created new federal criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme

to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises,

any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the

payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a

material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits,

items or services relating to healthcare matters.

Similar to the federal Anti-Kickback Statute, a person or entity can be

found guilty of violating HIPAA without actual knowledge of the statute or specific intent to violate it;

as amended by HITECH and their respective implementing regulations, which impose, among other things, requirements on certain

covered healthcare providers, health plans and healthcare clearinghouses, as well as their respective business associates

that perform services for them that involve the use, or disclosure of, individually identifiable health information relating

to the privacy, security and transmission of individually identifiable health information without appropriate authorization.

HITECH also created new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable

to business associates and gave state attorneys general new authority to file civil actions for damages or injunctions in

federal courts to enforce the federal HIPAA laws and seek attorneys’

fees and costs associated with pursuing federal

civil actions;

federal Physician Payment Sunshine Act, created under the Patient Protection and Affordable Care Act and its implementing

regulations, which require manufacturers of drugs, devices, biologicals and medical supplies for which payment is available

under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to

the United States Department of Health and Human Services information related to payments or other transfers of value made

to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals,

as well as ownership and investment interests held by physicians and their immediate family members;

consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially

harm consumers;

state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing

arrangements and claims involving healthcare items or services reimbursed by nongovernmental third-party payors, including

private insurers, and may be broader in scope than their federal equivalents;

state and foreign 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 or otherwise restrict payments that may be made to healthcare providers;

state and foreign

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;

and state and foreign laws governing the privacy and security of

health information in certain circumstances, many of which differ from each other in significant ways and often are not preempted

by HIPAA, thus complicating compliance efforts;

Union and other foreign provisions.

distribution of pharmaceutical products is subject to additional requirements and regulations, including extensive recordkeeping,

licensing, storage, security requirements intended to prevent the unauthorized sale of pharmaceutical products and, in some foreign

countries, including the European Union countries, mandatory anti-counterfeit features.

scope and enforcement of each of these laws is uncertain and subject to rapid change in the current environment of healthcare

reform, especially in light of the lack of applicable precedent and regulations.

Federal and state enforcement bodies have recently

increased their scrutiny of interactions between healthcare companies and healthcare providers, which has led to a number of investigations,

prosecutions, convictions and settlements in the healthcare industry.

Ensuring business arrangements comply with applicable healthcare

laws, as well as responding to possible investigations by government authorities, can be time- and resource-consuming and can

divert a company’s attention from the business.

failure to comply with any of these laws or regulatory requirements could subject us to possible legal or regulatory action.

on the circumstances, failure to meet applicable regulatory requirements can result in civil, criminal and administrative penalties,

damages, fines, disgorgement, individual imprisonment, possible exclusion from participation in federal and state funded healthcare

programs, contractual damages and the curtailment or restricting of our operations, as well as additional reporting obligations

and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of noncompliance

with these laws.

Any action for violation of these laws, even if successfully defended, could cause a pharmaceutical manufacturer

to incur significant legal expenses and divert management’s attention from the operation of the business.

Prohibitions or

restrictions on sales or withdrawal of future marketed products could materially affect business in an adverse way.

are subject to a code of business conduct and ethics, but it is not always possible to identify and deter employee misconduct,

and the precautions we take to detect and prevent inappropriate conduct may not be effective in controlling unknown or unmanaged

risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be

in compliance with such laws or regulations.

Efforts to ensure that the our business arrangements will comply with applicable

healthcare laws may involve substantial costs.

It is possible that governmental and enforcement authorities will conclude that

our business practices may not comply with current or future statutes, regulations or case law interpreting applicable fraud and

abuse or other healthcare laws and regulations.

If any such actions are instituted against us, and we are not successful in defending

ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of

civil, criminal and administrative penalties, damages, disgorgement, monetary fines, possible exclusion from participation in

Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future

earnings, and curtailment of our operations, any of which could adversely affect our ability to operate our business and our results

of operations.

In addition, the approval and commercialization of any of our product candidates outside the United States will

also likely subject us to foreign equivalents of the healthcare laws mentioned above, among other foreign laws.

FDA and other equivalent foreign regulatory agencies may implement additional regulations or restrictions on the development and

commercialization of products which act on the microbiome, which may be difficult to predict.

FDA and equivalent foreign regulatory agencies in other countries have each expressed interest in further regulating biotechnology

products and product candidates, such as those that act on the human microbiome.

Agencies at both the federal and state level

in the United States, as well as the U.S.

congressional committees and other governments or governing agencies, have also expressed

interest in further regulating the biotechnology industry.

Such action may delay or prevent commercialization of some or all of

our product candidates.

Adverse developments in non-IND human clinical studies or clinical trials of microbiome products conducted

by others may cause the FDA or other oversight bodies to change the requirements for approval of any of our product candidates.

These regulatory review agencies and committees and the new requirements or guidelines they promulgate may lengthen the regulatory

review process, require us to perform additional studies or trials, increase our development costs, lead to changes in regulatory

positions and interpretations, delay or prevent approval and commercialization of our product candidates or lead to significant

post-approval limitations or restrictions.

As we advance our product candidates, we will be required to consult with these regulatory

agencies and comply with applicable requirements and guidelines.

If we fail to do so, we may be required to delay or discontinue

development of such product candidates.

These additional processes may result in a review and approval process that is longer

than we otherwise would have expected.

Delays as a result of an increased or lengthier regulatory approval process or further

restrictions on the development of our product candidates can be costly and could negatively impact our ability to complete clinical

trials and commercialize our current and future product candidates in a timely manner if at all.

rate fluctuations between the U.S.

Dollar, the New Israeli Shekel, the Euro and other foreign currencies, may negatively affect

our future revenues.

proceeds from sales of our securities are generally received in U.S.

Our headquarters are located in Israel, where the

majority of our general and administrative expenses and research and development costs are incurred in the New Israeli Shekel

(the “NIS”).

Future expenses may be incurred in foreign currencies such as the Euro or British Pound.

our financial results may be affected by fluctuations in the exchange rates of currencies in the countries.

For example, during

2019, we witnessed a strengthening of the average exchange rate of the NIS against the U.S.

delay or failure to complete our clinical trials;

withdrawal of clinical trial participants;

decreased demand for our product candidates;

injury to our reputation;

litigation costs;

substantial monetary awards against us;

diversion of management or other resources from

key aspects of our operations.

If we succeed in marketing products, product

liability claims could result in an FDA or equivalent foreign regulatory agency investigation of the safety or efficacy of our

products, our manufacturing processes and facilities or our marketing programs.

Such investigation could also potentially lead

to a recall of our products or more serious enforcement actions, or limitations on the indications, for which they may be used,

or suspension or withdrawal of approval.

We currently only have limited clinical

trials insurance policies that cover clinical trials in certain territories.

We intend to expand our insurance coverage to include

the sale of commercial products if marketing approval is obtained for our product candidates or any other compound that we may

However, insurance coverage is expensive, and we may not be able to maintain insurance coverage at a reasonable cost

or at all, and the insurance coverage that we have or obtain may not be adequate to cover potential claims or losses.

Our employees, independent contractors, consultants,

commercial partners and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory

standards and requirements.

We are exposed to the risk of employee

fraud or other illegal activity by our employees, independent contractors, consultants, commercial partners and vendors.

by these parties could include intentional, reckless and/or negligent conduct that fails to comply with the laws of the FDA and

other similar foreign regulatory bodies, provide true, complete and accurate information to the FDA and other similar foreign

regulatory bodies, comply with manufacturing standards we have established, comply with healthcare fraud and abuse laws in the

United States and similar foreign fraudulent misconduct laws or report financial information or data accurately or to disclose

unauthorized activities to us.

If we obtain FDA approval of any of our product candidates and begin commercializing those products

in the United States, our potential exposure under such laws will increase significantly, and our costs associated with compliance

with such laws are also likely to increase.

These laws may impact, among other things, our current activities with principal investigators

and research patients, as well as proposed and future sales, marketing and education programs.

The FDA and other equivalent foreign regulatory agencies

may implement additional regulations or restrictions on the development and commercialization of products which act on the microbiome,

which may be difficult to predict.

The FDA and equivalent foreign regulatory

agencies in other countries have each expressed interest in further regulating biotechnology products and product candidates,

such as those that act on the human microbiome.

Agencies at both the federal and state level in the United States, as well as

congressional committees and other governments or governing agencies, have also expressed interest in further regulating

the biotechnology industry.

Such action may delay or prevent commercialization of some or all of our product candidates.

developments in non-IND human clinical studies or clinical trials of microbiome products conducted by others may cause the FDA

or other oversight bodies to change the requirements for approval of any of our product candidates.

These regulatory review agencies

and committees and the new requirements or guidelines they promulgate may lengthen the regulatory review process, require us to

perform additional studies or trials, increase our development costs, lead to changes in regulatory positions and interpretations,

delay or prevent approval and commercialization of our product candidates or lead to significant post-approval limitations or

restrictions.

As we advance our product candidates, we will be required to consult with these regulatory agencies and comply with

applicable requirements and guidelines.

If we fail to do so, we may be required to delay or discontinue development of such product

These additional processes may result in a review and approval process that is longer than we otherwise would have

Delays as a result of an increased or lengthier regulatory approval process or further restrictions on the development

of our product candidates can be costly and could negatively impact our ability to complete clinical trials and commercialize

our current and future product candidates in a timely manner if at all.

Exchange rate fluctuations between the U.S.

New Israeli Shekel, the Euro and other foreign currencies, may negatively affect our future revenues.

Our proceeds from sales of our securities

are generally received in U.S.

Our headquarters are located in Israel, where the majority of our general and administrative

expenses and research and development costs are incurred in the New Israeli Shekel, or NIS.

Future expenses may be incurred in

foreign currencies such as the Euro or British Pound.

As a result, our financial results may be affected by fluctuations in the

exchange rates of currencies in the countries.

For example, during 2020, we witnessed a strengthening of the average exchange

rate of the NIS against the U.S.

Dollar, which increased the U.S.

value of Israeli expenses.

If the NIS strengthens against the U.S.

Dollar value of Israeli expenses.

If the NIS strengthens against

Dollar, as it did in 2020, the U.S.

Dollar value of our Israeli

expenses, mainly personnel and facility-related, will increase.

To date, we have not entered into any foreign currency hedging

contracts to mitigate our exposure to foreign currency exchange risk.

Although exposure to currency fluctuations to date has

not had a material adverse effect on our business, there can be no assurance that fluctuations in the future will not have a material

adverse effect on our operating results and financial condition.

we engage in future acquisitions or strategic partnerships, this may increase our capital requirements, dilute our stockholders,

cause us to incur debt or assume contingent liabilities, and subject us to other risks.

may evaluate various acquisition opportunities and strategic partnerships, including licensing or acquiring complementary products,

intellectual property rights, technologies or businesses.

Any potential acquisition or strategic partnership may entail numerous

risks, including:

operating expenses and cash requirements;

assumption of additional indebtedness or contingent liabilities;

issuance of our equity securities;

of operations, intellectual property and products of an acquired company, including difficulties associated with integrating

new personnel;

diversion of our management’s attention from our existing product programs and initiatives in pursuing such a strategic

merger or acquisition;

of key employees, the loss of key personnel and uncertainties in our ability to maintain key business relationships;

and uncertainties associated with the other party to such a transaction, including the prospects of that party and their existing

products or product candidates and marketing approvals;

inability to generate revenue from acquired technology and/or products sufficient to meet our objectives in undertaking the

acquisition or even to offset the associated acquisition and maintenance costs.

Related to Government Regulation

Therapy Designation or Fast Track Designation by the FDA, even if granted for any of our product candidates developed for therapeutic

indications, may not lead to a faster development, regulatory review or approval process, and it does not increase the likelihood

that any of our product candidates will receive marketing approval in the United States.

the United States, we may seek a Breakthrough Therapy Designation for some of our product candidates, including BX002 and/or BX003.

Dollar value of our Israeli expenses, mainly personnel and facility-related, will

We use foreign exchange contracts (mainly option and forward contracts) to hedge balance sheet items from currency exposure.

However, these foreign exchange contracts are not designated as hedging instruments for accounting purposes and they may not be

Although exposure to currency fluctuations to date has not had a material adverse effect on our business, there can

be no assurance that fluctuations in the future will not have a material adverse effect on our operating results and financial

Our limited operating history may make it difficult to

evaluate the success of our business to date and to assess our future viability.

Since inception in 2015, BiomX Ltd.

devoted substantially all of its resources to developing product candidates with phage technology through its preclinical programs,

building its intellectual property portfolio, developing a supply chain, planning its business, raising capital and providing

general and administrative support for these operations.

We have not yet demonstrated our ability to successfully complete any

clinical study or other pivotal clinical trials, 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 product commercialization.

Consequently, any predictions made about our future success or viability may not be as accurate as they could be if we had a longer

operating history.

In addition, as an early-stage company,

we may encounter unforeseen expenses, difficulties, complications, delays and other known and unknown circumstances.

As we advance

our product candidates, we will need to transition from a company with a research focus to a company capable of supporting clinical

development and, if successful, commercial activities.

We may not be successful in such a transition.

We need to grow the size of our organization and may experience

difficulties in managing this growth.

As our research, development, manufacturing

and commercialization plans and strategies develop as a public company, we need additional managerial, operational, sales, marketing,

financial and other personnel.

Future growth would impose significant added responsibilities on members of management, including:

identifying, recruiting, compensating, integrating, maintaining and motivating additional employees;

managing our internal research and development efforts effectively, including identification of clinical candidates, scaling our manufacturing process and navigating the clinical and FDA review process for our product candidates;

improving our operational, financial and management controls, reporting systems and procedures.

Our future financial performance and our

ability to commercialize our product candidates will depend, in part, on our ability to effectively manage any future growth, and

our management may also have to divert a disproportionate amount of our attention away from day-to-day activities in order to devote

a substantial amount of time to managing these growth activities.

If we are not able to effectively expand

our organization by hiring new employees and expanding our groups of consultants and contractors, we may not be able to successfully

implement the tasks necessary to further develop and commercialize our product candidates and, accordingly, may not achieve our

research, development and commercialization goals.

We are an “emerging growth company,”

cannot be certain that the reduced disclosure requirements applicable to “emerging growth companies”

will not make

our Common Stock less attractive to investors.

We are an “emerging growth company,”

as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act.

For so long as we remain an emerging growth company,

we intend to take advantage of certain exemptions from reporting requirements that are applicable to other public companies that

are not emerging growth companies, including, but not limited to, compliance with the auditor attestation requirements of Section

404(b) of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation

in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive

compensation and stockholder approval of any golden parachute payments not previously approved.

Further, under the JOBS Act, emerging

growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until

such time as those standards apply to private companies.

We have irrevocably elected not to avail ourselves of this exemption from

new or revised accounting standards and, therefore, will be subject to the same new or revised accounting standards as other public

companies that are not emerging growth companies.

We will remain an emerging growth company

until the earliest of (a) the last day of our fiscal year during which we have generated total annual gross revenue of at least

$1.07 billion;

(b) the last day of our fiscal year following the fifth anniversary of the completion of our IPO;

which we have issued more than $1.0 billion in nonconvertible debt securities during the prior three-year period;

or (d) the date

on which we are deemed to be a “large accelerated filer”

under the Exchange Act.

Risks Related to Government Regulation

Breakthrough Therapy Designation or Fast Track Designation

by the FDA, even if granted for any of our product candidates developed for therapeutic indications, may not lead to a faster

development, regulatory review or approval process, and it does not increase the likelihood that any of our product candidates

will receive marketing approval in the United States.

In the United States, we may seek a Breakthrough

Therapy Designation for some of our product candidates, including BX003 or our cystic fibrosis product candidate under development.

A breakthrough therapy is defined as a therapy that is intended, alone or in combination with one or more other therapies, to

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the discretion of the FDA.

the European Union, the PRIME (PRIority MEdicines) status is similar to the Breakthrough Therapy Designation.

The EMA has implemented

the PRIME status to support the development and accelerate the approval of complex, innovative medicinal products addressing an

unmet medical need.

The PRIME status enables early dialogue with the relevant EMA scientific committees and, possibly, some payors

and thus reinforces the EMA’s scientific and regulatory support.

The PRIME status, which is granted at the EMA’s discretion,

focuses on medicinal products the marketing authorization of which qualifies for accelerated assessment (medicinal products of

major interest from a public health perspective, in particular from a therapeutic innovation perspective).

even if we believe one of our product candidates meets the criteria for designation as a breakthrough therapy or for PRIME status,

the FDA or EMA, respectively, may disagree and instead determine not to make such designation.

In any event, the receipt of a

Breakthrough Therapy Designation or PRIME status for a product candidate may not actually result in a faster development process,

review or approval compared to therapies considered for approval under conventional procedures and does not assure ultimate approval.

In addition, even if one or more of our product candidates qualify as breakthrough therapies or is granted PRIME status, the FDA

or EMA, respectively, may later decide that such product candidates no longer meet the conditions for qualification or decide

that the time period for review or approval will not be shortened.

the United States, we may seek Fast Track Designation for some of our product candidates for therapeutic indications.

is intended for the treatment of a serious or life-threatening condition and the therapy demonstrates the potential to address

unmet medical needs for this condition, the therapy sponsor may apply for Fast Track Designation.

The FDA has broad discretion

whether or not to grant this designation, so even if we believe a particular product candidate is eligible for this designation;

we cannot assure you that the FDA would decide to grant it.

Even if we receive Fast Track Designation, we may not experience a

faster development process, review or approval compared to conventional FDA procedures.

The FDA may withdraw Fast Track Designation

if we believe that the designation is no longer supported by data from our clinical development program.

Fast Track Designation

alone does not guarantee qualification for the FDA’s priority review procedures.

countries may have adopted schemes designed to ensure an accelerated approval of drugs that are especially important for patients.

For example, in the European Union, the EMA may agree to an accelerated assessment (150 days instead of 210 days) for medicinal

products of major interest from a public health perspective, in particular from a therapeutic innovation perspective).

competent regulatory authorities may grant market authorizations “under exceptional circumstances,”

in cases where

all the required safety and efficacy data have not been and will not be collected, to medicinal products designed for unmet needs

or orphan medicinal products.

Although a marketing authorization under exceptional circumstances is definitive, the risk-benefit

balance of the medicinal product must be reviewed annually and the marketing authorization is withdrawn if it becomes negative.

Moreover, under the centralized procedure, the European Commission may grant “conditional marketing authorizations”

in cases where all the required safety and efficacy data are not yet available.

The conditional marketing authorization is subject

to conditions to be fulfilled for generating the missing data or ensuring increased safety measures.

It is valid for one year

and has to be renewed annually until fulfillment of all the conditions.

If the conditions are not fulfilled within the timeframe

set by the EMA, the marketing authorization ceases to be renewed.

As with Fast Track Designation, the competent regulatory authorities

in the European Union have broad discretion whether or not to grant such an accelerated assessment or approval and, even if such

assessment or approval is granted, we may not experience a faster development process, review or approval compared to conventional

may seek a priority review designation for one or more of our other product candidates for therapeutic indications, but we might

not receive such designation, and even if we do, such designation may not lead to a faster development or regulatory review or

approval process.

the FDA determines that a product candidate offers a treatment for a serious condition and, if approved, the product would provide

a significant improvement in safety or effectiveness, the FDA may designate the product candidate for priority review.

review designation means that the goal for the FDA to review an application is six months, rather than the standard review period

of ten months.

We may request priority review for our product candidates.

The FDA has broad discretion with respect to whether

or not to grant priority review status to a product candidate, so even if we believe a particular product candidate is eligible

for such designation or status, the FDA may decide not to grant it.

Moreover, a priority review designation does not necessarily

result in an expedited regulatory review or approval process or necessarily confer any advantage with respect to approval compared

to conventional FDA procedures.

Receiving priority review from the FDA does not guarantee approval within the six-month review

cycle or at all.

may fail to obtain and maintain orphan drug designations from the FDA or equivalent foreign regulatory agencies for our current

and future therapeutic product candidates, as applicable.

strategy may include filing for the orphan drug designation where available for our product candidates for therapeutic indications.

We currently believe that BX003 may qualify for such a designation in the United States, the European Union, and the other countries

supporting the development and marketing of drugs for rare diseases.

the United States, under the Orphan Drug Act, the FDA may grant orphan drug designation to a drug or biologic intended to treat

a rare disease or condition, which is defined as one occurring in a patient population of fewer than 200,000 in the United States,

or a patient population greater than 200,000 in the United States where there is no reasonable expectation that the cost of developing

the drug or biologic will be recovered from sales in the United States.

In the United States, the orphan drug designation entitles

a party to financial incentives, such as opportunities for grant funding toward clinical trial costs, tax advantages and user-fee

In addition, if a product that has the orphan drug designation subsequently receives the first FDA approval for the disease

for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve

any other applications, including an NDA, to market the same drug or biologic for the same indication for seven years, except

in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity or where the original

manufacturer is unable to assure sufficient product quantity.

addition, exclusive marketing rights in the United States may be limited if we seek approval for an indication broader than the

orphan-designated indication or may be lost if the FDA later determines that the request for designation was materially defective,

or if we are unable to assure sufficient quantities of the product to meet the needs of patients with the orphan-designated disease

or condition.

Further, even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the

product from competition because different drugs with different active moieties may receive and be approved for the same condition,

and only the first applicant to receive approval will receive the benefits of marketing exclusivity.

Even after an orphan-designated

product is approved, the FDA can subsequently approve a later drug with the same active moiety for the same condition if the FDA

concludes that the later drug is clinically superior if it is shown to be safer, more effective or makes a major contribution

In the European Union, the PRIME (PRIority

MEdicines) status is similar to the Breakthrough Therapy Designation.

The EMA has implemented the PRIME status to support the

development and accelerate the approval of complex, innovative medicinal products addressing an unmet medical need.

status enables early dialogue with the relevant EMA scientific committees and, possibly, some payors and thus reinforces the EMA’s

scientific and regulatory support.

The PRIME status, which is granted at the EMA’s discretion, focuses on medicinal products

the marketing authorization of which qualifies for accelerated assessment (medicinal products of major interest from a public

health perspective, in particular from a therapeutic innovation perspective).

Accordingly, even if we believe one of

our product candidates meets the criteria for designation as a breakthrough therapy or for PRIME status, the FDA or EMA, respectively,

may disagree and instead determine not to make such designation.

In any event, the receipt of a Breakthrough Therapy Designation

or PRIME status for a product candidate may not actually result in a faster development process, review or approval compared to

therapies considered for approval under conventional procedures and does not assure ultimate approval.

In addition, even if one

or more of our product candidates qualify as breakthrough therapies or is granted PRIME status, the FDA or EMA, respectively,

may later decide that such product candidates no longer meet the conditions for qualification or decide that the time period for

review or approval will not be shortened.

In the United States, we may seek Fast

Track Designation for some of our product candidates for therapeutic indications.

If a therapy is intended for the treatment of

a serious or life-threatening condition and the therapy demonstrates the potential to address unmet medical needs for this condition,

the therapy sponsor may apply for Fast Track Designation.

The FDA has broad discretion whether or not to grant this designation,

so even if we believe a particular product candidate is eligible for this designation;

we cannot assure you that the FDA would

decide to grant it.

Even if we receive Fast Track Designation, we may not experience a faster development process, review or approval

compared to conventional FDA procedures.

The FDA may withdraw Fast Track Designation if we believe that the designation is no

longer supported by data from our clinical development program.

Fast Track Designation alone does not guarantee qualification

for the FDA’s priority review procedures.

Other countries may have adopted schemes

designed to ensure an accelerated approval of drugs that are especially important for patients.

For example, in the European Union,

the EMA may agree to an accelerated assessment (150 days instead of 210 days) for medicinal products of major interest from a

public health perspective, in particular from a therapeutic innovation perspective).

Furthermore, competent regulatory authorities

may grant market authorizations “under exceptional circumstances,”

in cases where all the required safety and efficacy

data have not been and will not be collected, to medicinal products designed for unmet needs or orphan medicinal products.

a marketing authorization under exceptional circumstances is definitive, the risk-benefit balance of the medicinal product must

be reviewed annually and the marketing authorization is withdrawn if it becomes negative.

Moreover, under the centralized procedure,

the European Commission may grant “conditional marketing authorizations”

in cases where all the required safety and

efficacy data are not yet available.

The conditional marketing authorization is subject to conditions to be fulfilled for generating

the missing data or ensuring increased safety measures.

It is valid for one year and has to be renewed annually until fulfillment

of all the conditions.

If the conditions are not fulfilled within the timeframe set by the EMA, the marketing authorization ceases

to be renewed.

As with Fast Track Designation, the competent regulatory authorities in the European Union have broad discretion

whether or not to grant such an accelerated assessment or approval and, even if such assessment or approval is granted, we may

not experience a faster development process, review or approval compared to conventional procedures.

We may seek a priority review designation for one or

more of our other product candidates for therapeutic indications, but we might not receive such designation, and even if we do,

such designation may not lead to a faster development or regulatory review or approval process.

If the FDA determines that a product candidate

offers a treatment for a serious condition and, if approved, the product would provide a significant improvement in safety or

effectiveness, the FDA may designate the product candidate for priority review.

A priority review designation means that the goal

for the FDA to review an application is six months, rather than the standard review period of ten months.

We may request priority

review for our product candidates.

The FDA has broad discretion with respect to whether or not to grant priority review status

to a product candidate, so even if we believe a particular product candidate is eligible for such designation or status, the FDA

may decide not to grant it.

Moreover, a priority review designation does not necessarily result in an expedited regulatory review

or approval process or necessarily confer any advantage with respect to approval compared to conventional FDA procedures.

priority review from the FDA does not guarantee approval within the six-month review cycle or at all.

We may fail to obtain and maintain orphan drug designations

from the FDA or equivalent foreign regulatory agencies for our current and future therapeutic product candidates, as applicable.

Our strategy may include filing for the orphan drug designation

where applicable for our product candidates for therapeutic indications.

We currently believe that our product candidate under

development for cystic fibrosis patients may qualify for such a designation in the United States, the European Union, and

the other countries supporting the development and marketing of drugs for rare diseases.

In the United States, under the Orphan

Drug Act, the FDA may grant orphan drug designation to a drug or biologic intended to treat a rare disease or condition, which

is defined as one occurring in a patient population of fewer than 200,000 in the United States, or a patient population greater

than 200,000 in the United States where there is no reasonable expectation that the cost of developing the drug or biologic will

be recovered from sales in the United States.

In the United States, the orphan drug designation entitles a party to financial

incentives, such as opportunities for grant funding toward clinical trial costs, tax advantages and user-fee waivers.

if a product that has the orphan drug designation subsequently receives the first FDA approval for the disease for which it has

such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications,

including an NDA, to market the same drug or biologic for the same indication for seven years, except in limited circumstances,

such as a showing of clinical superiority to the product with orphan drug exclusivity or where the original manufacturer is unable

to assure sufficient product quantity.

In addition, exclusive marketing rights

in the United States may be limited if we seek approval for an indication broader than the orphan-designated indication or may

be lost if the FDA later determines that the request for designation was materially defective, or if we are unable to assure sufficient

quantities of the product to meet the needs of patients with the orphan-designated disease or condition.

Further, even if we obtain

orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different

drugs with different active moieties may receive and be approved for the same condition, and only the first applicant to receive

approval will receive the benefits of marketing exclusivity.

Even after an orphan-designated product is approved, the FDA can

subsequently approve a later drug with the same active moiety for the same condition if the FDA concludes that the later drug

is clinically superior if it is shown to be safer, more effective or makes a major contribution to patient care.

Orphan drug designation

neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review

or approval process.

In addition, while we may seek the orphan drug designation for our product candidates, we may never receive

such designation.

An orphan drug legal regime also exists

in the European Union.

The EMA’s Committee for Orphan Medicinal Products, or COMP, gives opinions, and the European Commission

takes decisions, on the granting of the orphan drug designation to the development of products that are intended for the diagnosis,

prevention or treatment of (i) a life-threatening or chronically debilitating condition affecting not more than five in 10,000

persons in the European Economic Area (European Union plus Iceland, Liechtenstein and Norway);

or (ii) a life-threatening, seriously

debilitating or serious and chronic condition when, without incentives, it is unlikely that sales of the drug in the European

Economic Area would be sufficient to justify the necessary investment in developing the drug or biological product.

of the orphan designation requires that there is no satisfactory method of diagnosis, prevention or treatment, or, if such a method

exists, that the future medicine is to be of significant benefit to those affected by the condition.

The test for that later condition

is stringent, because the future product must be compared with all existing therapies for the rare condition, including surgical

operations, already authorized medicinal products and compounded preparations (subject to certain conditions).

At the time of

marketing authorization, the orphan designation is reviewed again by the COMP in view of the maintenance of the orphan status.

If the designation criteria are no longer met, the European Commission withdraws the orphan designation.

Maintenance of the orphan

designation at the time of marketing authorization means that all the drugs/biologicals authorized since the granting of the designation

become relevant for determining the lack of satisfactory therapy or the significant benefit.

If obtained, the orphan drug designation

would entitle us to financial incentives, such as reductions of fees or fee waivers and 10 years of market exclusivity.

exclusivity precludes the EMA or the national competent authorities from validating a marketing authorization application, and

the European Commission or a national competent authority from granting a marketing authorization, for a same or similar drug/biological

and the same therapeutic indication.

The 10-year period may be reduced to six years if the orphan designation criteria are no

longer met, including where it is shown that the product is not sufficiently profitable to justify maintenance of market exclusivity.

The orphan exclusivity may also be lost vis-à-vis another drug/biological in cases where the manufacturer is unable to

assure sufficient quantity of the drug to meet patient needs or if that other product is proved to be clinically superior to the

approved orphan product.

A drug/biological is clinically superior if it is safer, more effective or makes a major contribution

to patient care.

Orphan drug designation neither shortens the development time or regulatory review time of a drug nor gives the

drug any advantage in the regulatory review or approval process.

In addition, while we may seek the orphan drug designation for

our product candidates, we may never receive such designation.

orphan drug legal regime also exists in the European Union.

The EMA’s Committee for Orphan Medicinal Products (“COMP”)

gives opinions, and the European Commission takes decisions, on the granting of the orphan drug designation to the development

of products that are intended for the diagnosis, prevention or treatment of (i) a life-threatening or chronically debilitating

condition affecting not more than five in 10,000 persons in the European Economic Area (European Union plus Iceland, Liechtenstein

and Norway); or (ii) a life-threatening, seriously debilitating or serious and chronic condition when, without incentives,

it is unlikely that sales of the drug in the European Economic Area would be sufficient to justify the necessary investment in

developing the drug or biological product.

The granting of the orphan designation requires that there is no satisfactory method

of diagnosis, prevention or treatment, or, if such a method exists, that the future medicine is to be of significant benefit to

those affected by the condition.

The test for that later condition is stringent, because the future product must be compared with

all existing therapies for the rare condition, including surgical operations, already authorized medicinal products and compounded

preparations (subject to certain conditions).

At the time of marketing authorization, the orphan designation is reviewed again

by the COMP in view of the maintenance of the orphan status.

If the designation criteria are no longer met, the European Commission

withdraws the orphan designation.

Maintenance of the orphan designation at the time of marketing authorization means that all

the drugs/biologicals authorized since the granting of the designation become relevant for determining the lack of satisfactory

therapy or the significant benefit.

orphan drug designation entitles the company to financial incentives, such as reductions of fees or fee waivers and 10 years of

market exclusivity.

Market exclusivity precludes the EMA or the national competent authorities from validating a marketing authorization

application (“MAA”), and the European Commission or a national competent authority from granting a marketing authorization,

for a same or similar drug/biological and the same therapeutic indication.

The 10-year period may be reduced to six years if the

orphan designation criteria are no longer met, including where it is shown that the product is not sufficiently profitable to

justify maintenance of market exclusivity.

The orphan exclusivity may also be lost vis-à-vis another drug/biological in

cases where the manufacturer is unable to assure sufficient quantity of the drug to meet patient needs or if that other product

is proved to be clinically superior to the approved orphan product.

A drug/biological is clinically superior if it is safer, more

effective or makes a major contribution to patient care.

if we receive regulatory approval of any product candidates for therapeutic indications, we will be subject to ongoing regulatory

compliance obligations and continued regulatory review, which may result in significant additional expense.

Additionally, any

of our product candidates, if approved, could be subject to labeling and other restrictions and market withdrawal, and we may

be subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with our product

any of our product candidates is approved for therapeutic indications, we will be subject to ongoing regulatory requirements for

manufacturing, labeling, packaging, storage, distribution, advertising, promotion, sampling, recordkeeping, export, import, conduct

of post-marketing studies and submission of safety, efficacy and other post-market information, including both federal and state

requirements in the United States and requirements of equivalent foreign regulatory agencies.

In addition, we will be subject

to continued compliance with cGMP and good clinical practice (“GCP”) requirements for any clinical trials that we

conduct post-approval.

Manufacturers

and manufacturers’

facilities are required to comply with extensive FDA and equivalent foreign regulatory agency requirements,

including ensuring that quality control and manufacturing procedures conform to cGMP regulations.

As such, we and our contract

manufacturers will be subject to continual review and inspections to assess compliance with cGMP and adherence to commitments

made in any NDA, other marketing applications and previous responses to inspection observations.

Accordingly, we and others with

whom we work must continue to expend time, money, and effort in all areas of regulatory compliance, including manufacturing, production

and quality control.

FDA or equivalent foreign regulatory agencies have significant post-marketing authority, including, for example, the authority

to require labeling changes based on new safety information and to require post-marketing studies or clinical trials to evaluate

serious safety risks related to the use of a drug.

Any regulatory approvals that we receive for our product candidates may be

subject to limitations on the approved indicated uses for which the product may be marketed or to the conditions of approval,

or contain requirements for potentially costly post-marketing testing, including Phase 4 clinical trials and surveillance to monitor

the safety and efficacy of the product candidate.

The FDA or equivalent foreign regulatory agencies may also require a REMS program

as a condition of approval of our product candidates, which could entail requirements for long-term patient follow-up, a medication

guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient

registries and other risk minimization tools.

In addition, if the FDA or an equivalent foreign regulatory agency approves our

product candidates, we will have to comply with requirements, including submissions of safety and other post-marketing information

and reports and registration.

FDA or equivalent foreign regulatory agencies may impose consent decrees or withdraw approval if compliance with regulatory requirements

and standards is not maintained or if problems occur after the product reaches the market.

Later discovery of previously unknown

problems with our product candidates, including adverse events of unanticipated severity or frequency, or with our third-party

manufacturers or manufacturing processes, or failure to comply with regulatory requirements may result in revisions to the approved

labeling to add new safety information, the imposition of post-market studies or clinical trials to assess new safety risks, or

the imposition of distribution restrictions or other restrictions under a REMS program.

Other potential consequences include,

among other things:

on the marketing or manufacturing of our products, withdrawal of products from the market, or voluntary or mandatory product

warning or untitled enforcement letters, or holds on clinical trials;

by the FDA or equivalent foreign regulatory agencies to approve pending applications or supplements to approved applications

filed by us or the suspension or revocation of license approvals;

seizure or detention or refusal to permit the import or export of our product candidates; and

or the imposition of civil or criminal penalties.

Even if we receive regulatory approval of any product

candidates for therapeutic indications, we will be subject to ongoing regulatory compliance obligations and continued regulatory

review, which may result in significant additional expense.

Additionally, any of our product candidates, if approved, could be

subject to labeling and other restrictions and market withdrawal, and we may be subject to penalties if we fail to comply with

regulatory requirements or experience unanticipated problems with our product candidates.

If any of our product candidates is approved for therapeutic

indications, we will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, distribution,

advertising, promotion, sampling, recordkeeping, export, import, conduct of post-marketing studies and submission of safety, efficacy

and other post-market information, including both federal and state requirements in the United States and requirements of equivalent

foreign regulatory agencies.

In addition, we will be subject to continued compliance with cGMP and GCP requirements for any clinical

trials that we conduct post-approval.

Manufacturers and manufacturers’

are required to comply with extensive FDA and equivalent foreign regulatory agency requirements, including ensuring that quality

control and manufacturing procedures conform to cGMP regulations.

As such, we and our contract manufacturers will be subject to

continual review and inspections to assess compliance with cGMP and adherence to commitments made in any NDA, other marketing applications

and previous responses to inspection observations.

Accordingly, we and others with whom we work must continue to expend time, money,

and effort in all areas of regulatory compliance, including manufacturing, production and quality control.

The FDA or equivalent foreign regulatory

agencies have significant post-marketing authority, including, for example, the authority to require labeling changes based on

new safety information and to require post-marketing studies or clinical trials to evaluate serious safety risks related to the

use of a drug.

Any regulatory approvals that we receive for our product candidates may be subject to limitations on the approved

indicated uses for which the product may be marketed or to the conditions of approval, or contain requirements for potentially

costly post-marketing testing, including Phase 4 clinical trials and surveillance to monitor the safety and efficacy of the product

The FDA or equivalent foreign regulatory agencies may also require a REMS program as a condition of approval of our

product candidates, which could entail requirements for long-term patient follow-up, a medication guide, physician communication

plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization

In addition, if the FDA or an equivalent foreign regulatory agency approves our product candidates, we will have to comply

with requirements, including submissions of safety and other post-marketing information and reports and registration.

The FDA or equivalent foreign regulatory

agencies may impose consent decrees or withdraw approval if compliance with regulatory requirements and standards is not maintained

or if problems occur after the product reaches the market.

Later discovery of previously unknown problems with our product candidates,

including adverse events of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes,

or failure to comply with regulatory requirements may result in revisions to the approved labeling to add new safety information,

the imposition of post-market studies or clinical trials to assess new safety risks, or the imposition of distribution restrictions

or other restrictions under a REMS program.

Other potential consequences include, among other things:

restrictions on the marketing or manufacturing of our products, withdrawal of products from the market, or voluntary or mandatory product recalls;

fines, warning or untitled enforcement letters, or holds on clinical trials;

refusal by the FDA or equivalent foreign regulatory agencies to approve pending applications or supplements to approved applications filed by us or the suspension or revocation of license approvals;

product seizure or detention or refusal to permit the import or export of our product candidates;

injunctions or the imposition of civil or criminal penalties.

FDA or equivalent foreign regulatory agencies strictly regulate the marketing, labeling, advertising and promotion of drug products

47 unchanged sentences

which would be costly and time-consuming and may delay aspects of our business plan.

products that we may develop may become subject to unfavorable pricing regulations, third-party reimbursement practices or health

care reform initiatives, which could make it difficult for us to sell any product candidates or therapies profitably.

products that we may develop may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare

reform initiatives, which could make it difficult for us to sell any product candidates or therapies profitably.

regulations that govern pricing for new medical products vary widely from country to country.

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could be adversely affected.

health care legislative and regulatory reform measures may have a material adverse effect on our business and results of operations.

health care legislative and regulatory reform measures may have a material adverse effect

on our business and results of operations.

in regulations, statutes or the interpretation of existing regulations could impact our business in the future by requiring, for

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could adversely affect the operation of our business.

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

in March 2010, the Patient Protection and Affordable Care Act (the “ACA”), was passed, which substantially changed

In the United States, there have been and continue to be a number

of legislative initiatives to contain health care costs.

For example, in March 2010, the ACA was passed, which substantially changed

the way health care is financed by both governmental and private insurers and significantly impacted the United States pharmaceutical

The ACA, among other things, subjects biological products to potential competition by lower-cost biosimilars;

a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that

are inhaled, infused, instilled, implanted or injected;

increases the minimum Medicaid rebates owed by manufacturers under the

Medicaid Drug Rebate Program;

a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are

inhaled, infused, instilled, implanted or injected;

increases the minimum Medicaid rebates owed by manufacturers under the Medicaid

Drug Rebate Program;

and extends the rebate program to individuals enrolled in Medicaid managed care organizations.

also establishes annual fees and taxes on manufacturers of certain branded prescription drugs and creates a new Medicare Part

D coverage gap discount program in which manufacturers must agree to offer 50% point of sale discounts off negotiated prices of

applicable brand drugs to eligible beneficiaries during their coverage gap period as a condition for the manufacturer’s

outpatient drugs to be covered under Medicare Part D.

It also establishes

annual fees and taxes on manufacturers of certain branded prescription drugs and creates a new Medicare Part D coverage gap discount

program in which manufacturers must agree to offer 50% point of sale discounts off negotiated prices of applicable brand drugs

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

under Medicare Part D.

of the provisions of the ACA have yet to be fully implemented, while certain provisions have been subject to judicial and Congressional

challenges, as well as efforts by the current administration to repeal or replace certain aspects of the ACA.

challenges, as well as efforts by the Trump administration to repeal or replace certain aspects of the ACA.

laws and future state and federal health care reform measures may be adopted in the future, any of which may result in additional

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with typically lower prices) leads to price reductions in countries that traditionally granted high prices.

are subject to certain U.S.

and foreign anticorruption, anti-money laundering, export control, sanctions and other trade laws

and regulations.

at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire,

retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved

or commercialized in a timely manner or at all, which could negatively impact our business.

ability of the FDA to review and or approve new products can be affected by a variety of factors, including government budget

and funding levels, statutory, regulatory, and policy changes, the FDA’s ability to hire and retain key personnel and accept

the payment of user fees, and other events that may otherwise affect the FDA’s ability to perform routine functions.

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

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.

Disruptions at the FDA and other regulatory authorities may also slow the time necessary for new drugs and biologics to be reviewed

and/or approved by necessary regulatory authorities, which would adversely affect our business.

For example, over the last several

years, including for 35 days beginning on December 22, 2018, the U.S.

government has shut down several times and certain regulatory

authorities, such as the FDA, have had to furlough critical FDA employees and stop critical activities.

in response to the global pandemic of COVID-19, on March 10, 2020 the FDA announced its intention to postpone most foreign inspections

of manufacturing facilities and products through April 2020, and subsequently, on March 18, 2020, the FDA temporarily postponed

routine surveillance inspections of domestic manufacturing facilities.

Subsequently, on July 10, 2020 the FDA announced its intention

to resume certain on-site inspections of domestic manufacturing facilities subject to a risk-based prioritization system.

FDA intends to use this risk-based assessment system to identify the categories of regulatory activity that can occur within a

given geographic area, ranging from mission critical inspections to resumption of all regulatory activities.

Regulatory authorities

outside the United States may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic.

If a prolonged

government shutdown occurs, or if global health concerns continue to prevent the FDA or other regulatory authorities from conducting

their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other

regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on

our business.

We are subject to certain U.S.

and foreign anticorruption,

anti-money laundering, export control, sanctions and other trade laws and regulations.

We can face serious consequences for violations.

other matters, U.S.

and foreign anticorruption, anti-money laundering, export control, sanctions and other trade laws and regulations,

which are collectively referred to as Trade Laws, prohibit companies and their employees, agents, clinical research organizations,

legal counsel, accountants, consultants, contractors and other partners from authorizing, promising, offering, providing, soliciting

or receiving, directly or indirectly, corrupt or improper payments or anything else of value to or from recipients in the public

or private sector.

Violations of Trade Laws can result in substantial criminal fines and civil penalties, imprisonment, the loss

of trade privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences.

We have direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals,

universities and other organizations.

We also expect our non-U.S.

Among other matters, U.S.

and foreign anticorruption,

anti-money laundering, export control, sanctions and other trade laws and regulations, which are collectively referred to as Trade

Laws, prohibit companies and their employees, agents, clinical research organizations, legal counsel, accountants, consultants,

contractors and other partners from authorizing, promising, offering, providing, soliciting or receiving, directly or indirectly,

corrupt or improper payments or anything else of value to or from recipients in the public or private sector.

Violations of Trade

Laws can result in substantial criminal fines and civil penalties, imprisonment, the loss of trade privileges, debarment, tax reassessments,

breach of contract and fraud litigation, reputational harm, and other consequences.

We have direct or indirect interactions with

officials and employees of government agencies or government-affiliated hospitals, universities and other organizations.

expect our non-U.S.

activities to increase over time.

We plan to engage third parties

for clinical trials and/or to obtain necessary permits, licenses, patent registrations and other regulatory approvals, and we

can be held liable for the corrupt or other illegal activities of our personnel, agents or partners, even if we do not explicitly

authorize or have prior knowledge of such activities.

We plan to engage third parties for clinical trials and/or to obtain necessary

permits, licenses, patent registrations and other regulatory approvals, and we can be held liable for the corrupt or other illegal

activities of our personnel, agents or partners, even if we do not explicitly authorize or have prior knowledge of such activities.

Related to our Licensed and Co-Owned Intellectual Property

license agreements we maintain, including the Research and License Agreement dated as of June 22, 2015, as amended (the “License

Agreement”) with Yeda Research and Development Company Limited (“Yeda”), are important to our business.

or the other parties to our license agreements fail to adequately perform under the license agreements, or if we or they terminate

the license agreements, the development, testing, manufacture, production and sale of our microbiome-based therapeutic product

license agreements we maintain, including the Yeda 2015 License Agreement, with Yeda are important to our business.

other parties to our license agreements fail to adequately perform under the license agreements, or if we or they terminate the

license agreements, the development, testing, manufacture, production and sale of our phage-based therapeutic or cosmetic product

candidates would be delayed or terminated, and our business would be adversely affected.

undertakes to procure certain research and development activities under the License Agreement, including the proof-of-concept

studies testing in vivo phage eradication against a model bacteria in germ-free mice, development of an IBD model in animals under

germ-free conditions and establishing in vivo method for measuring immune induction capability (Th1) of bacteria, followed by

testing several candidate IBD-inducing bacterial strains, during the research period, subject to the terms and conditions specified

Yeda 2015 License Agreement provides for an exclusive worldwide license to certain know-how and research information related to

the development, testing, manufacture, production and sale of microbiome-based therapeutic product candidates, including candidates

specified in the agreement, which are used in our phage discovery platform, as well as patents, research and other rights to phage

product candidates resulting from the work of the consultants identified in the agreement and further research that we funded.

The License Agreement terminates upon the later of the expiration of the last of the patents covered under the License Agreement

and the expiry of a continuous 15-year period during which there has not been a first commercial sale of any product in any country.

Yeda may also terminate the agreement if we fail to observe certain diligence and development requirements and milestones as described

in the License Agreement.

The License Agreement with Yeda provides for an exclusive worldwide license to certain know-how and

research information related to the development, testing, manufacture, production and sale of microbiome-based therapeutic product

candidates, including candidates specified in the agreement, which are used in our phage discovery platform, as well as patents,

research and other rights to phage product candidates resulting from the work of the consultants identified in the agreement and

further research that we funded.

The License Agreement terminates upon the later of the expiration of the last of the patents

covered under the License Agreement and the expiry of a continuous 15-year period during which there has not been a first commercial

sale of any product in any country.

Yeda may also terminate the agreement if we fail to observe certain diligence and development

requirements and milestones as described in the License Agreement.

we or Yeda may terminate the agreement for the material uncured

breach of the other party after a notice period or the other party’s winding up, bankruptcy, insolvency, dissolution or

other similar discontinuation of business.

Upon termination of the agreement, other than due to the passage of time, we are required

to grant to Yeda a nonexclusive, irrevocable, perpetual, fully paid-up, sublicensable, worldwide license in respect of our rights

in know-how and research results as described in the License Agreement, provided that, if Yeda subsequently grants a license to

a third party that utilizes our rights, we are entitled to share in the net proceeds actually received by Yeda arising out of

that license, subject to a cap based on the development expenses that we incur in connection with the License Agreement.

information on the License Agreement, see “

Business—Material Agreements—License Agreements—License

Agreement with Yeda.

we or Yeda may terminate the agreement for the material uncured breach of the other party after a notice

period or the other party’s winding up, bankruptcy, insolvency, dissolution or other similar discontinuation of business.

Upon termination of the agreement, other than due to the passage of time, we are required to grant to Yeda a nonexclusive, irrevocable,

perpetual, fully paid-up, sublicensable, worldwide license in respect of our rights in know-how and research results as described

in the Yeda 2015 License Agreement, provided that, if Yeda subsequently grants a license to a third party that utilizes our rights,

we are entitled to share in the net proceeds actually received by Yeda arising out of that license, subject to a cap based on

the development expenses that we incur in connection with the License Agreement.

For more information on the License Agreement,

Business—Material Agreements—License Agreements—License Agreement with Yeda.

also maintain additional license agreements:

the MIT, pursuant to which we received an exclusive, royalty-bearing license to certain patents held by MIT covering methods

to synthetically engineer phages in the field of treating, preventing or diagnosing IBD, cancer in humans, or certain other

specified indications or specific bacterial targets to utilize patents held by MIT;

Keio University (“Keio”) and JSR Corporation (“JSR”), pursuant to which we were granted an exclusive,

royalty-bearing, worldwide, perpetual sublicense by JSR to certain patent rights related to our IBD program.

Specifically,

these patent rights relate to bacterial targets that have been observed to be related to IBD and the phages that were observed

to eradicate these bacterial targets;

Keio and JSR, pursuant to which we were granted an exclusive, royalty-bearing, worldwide, perpetual sublicense by JSR to certain

patent rights related to our primary sclerosing cholangitis (“PSC”) program.

Specifically, these patent rights

relate to bacterial targets that have been observed to be related to PSC and the phages that were observed to eradicate these

bacterial targets.

with Keio and JSR, pursuant

to which we were granted an exclusive, royalty-bearing, worldwide, perpetual sublicense by JSR to certain patent rights related

to our IBD program.

Specifically, these patent rights relate to bacterial targets that have been observed to be related to IBD

and the phage that were observed to eradicate these bacterial targets;

with Keio and JSR, pursuant

to which we were granted an exclusive, royalty-bearing, worldwide, perpetual sublicense by JSR to certain patent rights related

to PSC program.

Specifically, these patent rights relate to bacterial targets that have been observed to be related to PSC and

the phage that were observed to eradicate these bacterial targets.

of the license agreements could cause significant delays in our product and commercialization efforts that could prevent us from

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In particular, we received exclusive, royalty-bearing licenses to certain patents held by third parties, including Yeda,

MIT, Keio and JSR.

Our license agreement with Yeda provides license to certain know-how and research information related to the

development, testing, manufacture, production and sale of microbiome-based therapeutic product candidates that are used in our

phage discovery platform, as well as patents, research and other rights to phage product candidates resulting from the work of

the consultants identified in the agreement and further research that we funded.

Our license agreements with MIT, Keio and JSR

provide licenses to patents related to, among other things, synthetic biology and our IBD, PSC and PSC programs.

Pursuant to these

license agreements, we are required to pay annual license fees, as well as a contingent consideration comprised of milestone and

royalty payments, which depend on the achievement of future milestones and potential revenue from products.

More information on

our license agreements, see “

Material Agreements.

Keio and JSR.

Our license agreement with Yeda provide license to certain know-how and research information related to the development,

testing, manufacture, production and sale of microbiome-based therapeutic product candidates that are used in our phage discovery

platform, as well as patents, research and other rights to phage product candidates resulting from the work of the consultants

identified in the agreement and further research that we funded.

Our license agreements with Keio and JSR provide licenses to

patents related to, among other things, IBD and PSC programs.

Pursuant to these license agreements, we are required to pay annual

license fees, as well as a contingent consideration comprised of milestone and royalty payments, which depend on the achievement

of future milestones and potential revenue from products.

we fail to comply with our obligations under our license agreements, including payment terms, our licensors may have the right

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in the U.S., defendant counterclaims alleging invalidity or unenforceability are common, as are validity challenges by the defendant

against the subject patent or related patents before the United States Patent and Trademark Office (“USPTO”).

for a validity challenge could be an alleged failure to meet any of several statutory patentability requirements, including lack

of novelty, obviousness, non-enablement, failure to meet the written description requirement, indefiniteness, and/or failure to

claim patentable subject matter.

Grounds for an unenforceability assertion could be an allegation that someone connected to prosecution

of the patent/s at issue intentionally withheld material information from the USPTO or made a misleading statement during prosecution.

Additional grounds for an unenforceability assertion include an allegation of misuse or anticompetitive use of patent rights,

and an allegation of incorrect inventorship with deceptive intent.

Third parties may also raise similar claims before the USPTO,

even outside the context of litigation.

The outcome of any assertion of invalidity and/or unenforceability is unpredictable.

a defendant or third party were to prevail on a legal assertion of invalidity and/or unenforceability, We and our licensors would

lose at least part, and perhaps all, of the claims of the challenged patent/s.

Such a loss of patent protection could have a material

adverse impact on our business.

against the subject patent or related patents before the USPTO.

Grounds for a validity challenge could be an alleged failure to

meet any of several statutory patentability requirements, including lack of novelty, obviousness, non-enablement, failure to meet

the written description requirement, indefiniteness, and/or failure to claim patentable subject matter.

Grounds for an unenforceability

assertion could be an allegation that someone connected to prosecution of the patent/s at issue intentionally withheld material

information from the USPTO or made a misleading statement during prosecution.

Additional grounds for an unenforceability assertion

include an allegation of misuse or anticompetitive use of patent rights, and an allegation of incorrect inventorship with deceptive

Third parties may also raise similar claims before the USPTO, even outside the context of litigation.

The outcome of any

assertion of invalidity and/or unenforceability is unpredictable.

If a defendant or third party were to prevail on a legal assertion

of invalidity and/or unenforceability, We and our licensors would lose at least part, and perhaps all, of the claims of the challenged

Such a loss of patent protection could have a material adverse impact on our business.

are dependent on patents and proprietary technology.

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not adequately protect our rights or permit us to gain or keep our competitive advantage.

might not be the first to file patent applications for our inventions;

may independently develop similar or alternative product candidates to any of our product candidates that fall outside the

scope of our patents;

pending patent applications may not result in issued patents;

issued patents may not provide a basis for commercially viable products or may not provide us with any competitive advantages

or may be challenged by third parties;

may design around our patent claims to produce competitive products that fall outside the scope of our patents;

may not develop additional patentable proprietary technology related to our product candidates;

are dependent upon the diligence of our appointed agents in national jurisdictions, acting for and on our behalf, which control

the prosecution of pending domestic and foreign patent applications and maintain granted domestic and foreign patents.

we might not be the

first to file patent applications for our inventions;

others may independently

develop similar or alternative product candidates to any of our product candidates that fall outside the scope of our patents;

our pending patent applications may not result

in issued patents;

our issued patents may not provide a basis for

commercially viable products or may not provide us with any competitive advantages or may be challenged by third parties;

others may design around our patent claims to

produce competitive products that fall outside the scope of our patents;

we may not develop additional patentable proprietary

technology related to our product candidates;

we are dependent upon the diligence of our appointed

agents in national jurisdictions, acting for and on our behalf, which control the prosecution of pending domestic and foreign

patent applications and maintain granted domestic and foreign patents.

issued patent does not guarantee us the right to practice the patented technology or commercialize the patented product.

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may arise between us and our licensors regarding intellectual property subject to a license agreement, including:

scope of rights granted under the license agreement and other interpretation-related issues;

and the extent to which, our products, services, technology and processes infringe on the intellectual property of the licensor

that is not subject to the license agreement;

right to sublicense patent and other rights to third parties under collaborative development relationships;

diligence obligations under the license agreement and what activities satisfy those diligence obligations;

inventorship and ownership of inventions and know-how resulting from the joint creation or use of intellectual property by

our licensors and us and our collaborators;

priority of invention of patented technology.

the scope of rights granted under the license

agreement and other interpretation-related issues;

whether, and the extent to which, our products,

services, technology and processes infringe on the intellectual property of the licensor that is not subject to the license

our right to sublicense patent and other rights

to third parties under collaborative development relationships;

our diligence obligations under the license

agreement and what activities satisfy those diligence obligations;

the inventorship and ownership of inventions

and know-how resulting from the joint creation or use of intellectual property by our licensors and us and our collaborators;

the priority of invention of patented technology.

we do not prevail in such disputes, we may lose any or all of our rights under such license agreements.

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proprietary product platform technologies or other technologies.

currently have rights to certain intellectual property, through licenses from third parties, to develop our product candidates

and proprietary product platform technologies.

Some health care companies and academic institutions are competing with us in the

field of microbiome therapies and may have patents and/or have filed and are likely filing patent applications potentially relevant

to our business.

In order to avoid infringing these third-party patents, we may find it necessary or prudent to obtain licenses

to such patents from such third-party intellectual property holders.

We may also require licenses from third parties for certain

technologies that we may be evaluating for use with our current or future product candidates.

However, we may be unable to secure

such licenses or otherwise acquire or in-license any compositions, methods of use, processes or other intellectual property rights

from third parties that we identify as necessary for our current or future product candidates and our proprietary product platform

at a reasonable cost or on reasonable terms, if at all.

We currently have rights to certain intellectual property, through

licenses from third parties, to develop our product candidates and proprietary product platform technologies.

Some healthcare companies

and academic institutions are competing with us in the field of microbiome therapies and may have patents and/or have filed and are likely

filing patent applications potentially relevant to our business.

In order to avoid infringing these third-party patents, we may find it

necessary or prudent to obtain licenses to such patents from such third-party intellectual property holders.

We may also require licenses

from third parties for certain technologies that we may be evaluating for use with our current or future product candidates.

we may be unable to secure such licenses or otherwise acquire or in-license any compositions, methods of use, processes or other intellectual

property rights from third parties that we identify as necessary for our current or future product candidates and our proprietary product

platform at a reasonable cost or on reasonable terms, if at all.

The licensing or acquisition of third-party intellectual property rights

is a competitive area, and several more established companies may pursue strategies to license or acquire third-party intellectual

property rights that we may consider attractive or necessary.

These established companies may have a competitive advantage over

us due to their size, capital resources and greater clinical development and commercialization capabilities.

In addition, companies

that perceive us to be a competitor may be unwilling to assign or license rights to us.

We also may be unable to license or acquire

third-party intellectual property rights on terms that would allow us to make an appropriate return on our investment or at all.

is a competitive area, and several more established companies may pursue strategies to license or acquire third-party intellectual property

rights that we may consider attractive or necessary.

These established companies may have a competitive advantage over us due to their

size, capital resources and greater clinical development and commercialization capabilities.

In addition, companies that perceive us to

be a competitor may be unwilling to assign or license rights to us.

We also may be unable to license or acquire third-party intellectual

property rights on terms that would allow us to make an appropriate return on our investment or at all.

the event that we try to obtain rights to required third-party intellectual property rights and is ultimately unsuccessful, we

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significant portion of our intellectual property has been developed by our employees in the course of their employment for us.

Under the Israeli Patent Law, 5727-1967 (the “Patent Law”) inventions conceived by an employee during the term and

as part of the scope of his or her employment with a company are regarded as “service inventions,”

which belong to

the employer, absent a specific agreement between the employee and employer giving the employee service invention rights.

Patent Law also provides that, if there is no such agreement between an employer and an employee, the Israeli Compensation and

Royalties Committee, or the Committee, a body constituted under the Patent Law, shall determine whether the employee is entitled

to remuneration for his or her inventions.

We generally enter into assignment of invention agreements with our employees pursuant

to which such individuals assign to us all rights to any inventions created in the scope of their employment or engagement with

Although our employees have agreed to assign to our service invention rights, we may face claims demanding remuneration in

consideration for assigned inventions.

As a consequence of such claims, we could be required to pay additional remuneration or

royalties to our current or former employees or be forced to litigate such claims, which could negatively affect our business.

Under the Israeli Patent Law, 5727-1967, or the Patent Law, inventions conceived by an employee during the term and as part of

the scope of his or her employment with a company are regarded as “service inventions,”

which belong to the employer,

absent a specific agreement between the employee and employer giving the employee service invention rights.

The Patent Law also

provides that, if there is no such agreement between an employer and an employee, the Israeli Compensation and Royalties Committee,

or the Committee, a body constituted under the Patent Law, shall determine whether the employee is entitled to remuneration for

his or her inventions.

We generally enter into assignment of invention agreements with our employees pursuant to which such individuals

assign to us all rights to any inventions created in the scope of their employment or engagement with us.

Although our employees

have agreed to assign to our service invention rights, we may face claims demanding remuneration in consideration for assigned

As a consequence of such claims, we could be required to pay additional remuneration or royalties to our current or

former employees or be forced to litigate such claims, which could negatively affect our business.

Related to Our Reliance on Third Parties

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including failing to meet deadlines for the completion of such trials.

continue to rely on third parties, such as contract research organizations (“CROs”), and clinical investigators, to

conduct and manage our clinical trials.

continue to rely on third parties, such as contract research organizations, or CROs, and clinical investigators, to conduct and

manage our clinical trials.

reliance on these third parties for research and development activities will reduce our control over these activities but does

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Moreover, the FDA requires us to comply with

regulatory standards, commonly referred to as GCPs, for conducting, recording and reporting the results of clinical trials to

assure that data and reported results are credible and accurate and that the rights, safety and welfare of trial participants

are protected.

GCPs for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible

and accurate and that the rights, safety and welfare of trial participants are protected.

Other countries’

regulatory agencies also have requirements for clinical trials with which we must comply.

We are also required to register ongoing clinical trials and post the results of completed clinical trials in a government-sponsored

database, clinicaltrials.gov, within specified time frames.

Failure to do so can result in fines, adverse publicity, and civil

and criminal sanctions.

regulatory agencies

also have requirements for clinical trials with which we must comply.

We are also required to register ongoing clinical trials

and post the results of completed clinical trials in a government-sponsored database, clinicaltrials.gov, within specified time

Failure to do so can result in fines, adverse publicity, and civil and criminal sanctions.

these third parties may also have relationships with other entities, some of which may be our competitors.

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may pose a number of risks, including the following:

parties have, and future third-party collaborators may have, significant discretion in determining the efforts and resources

that they will apply;

and future third parties may not perform their obligations as expected;

and future third parties may not pursue development and commercialization of any product candidates that achieve regulatory

approval or may elect not to continue or renew development or commercialization programs based on clinical trial results,

changes in the third parties’

strategic focus or available funding, or external factors, such as a strategic transaction

that may divert resources or create competing priorities;

parties may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon

a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical

and future third parties could independently develop, or develop with third parties, products that compete directly or indirectly

with our products and product candidates if the third parties believe that the competitive products are more likely to be

successfully developed or can be commercialized under terms that are more economically attractive than ours;

candidates discovered in collaboration with us may be viewed by our current or future third parties as competitive with their

own product candidates or products, which may cause such third parties to cease to devote resources to the commercialization

of our product candidates;

and future third parties may fail to comply with applicable regulatory requirements regarding the development, manufacture,

distribution or marketing of a product candidate or product;

and future third parties with marketing and distribution rights to one or more of our product candidates that achieve regulatory

approval may not commit sufficient resources to the marketing and distribution of such product or products;

disagreements

with current or future third parties, including disagreements over proprietary rights, contract interpretation or the preferred

course of development, might cause delays or terminations of the research, development or commercialization of product candidates,

might lead to additional responsibilities for us with respect to product candidates, or might result in litigation or arbitration,

any of which would be time-consuming and expensive;

and future third parties may not properly maintain or defend our intellectual property rights or may use our proprietary information

in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information

or expose us to potential litigation;

and future third parties may infringe the intellectual property rights of others, which may expose us to litigation and potential

and future third parties may infringe regulatory frameworks (such as but not limited to cybersecurity and/or privacy frameworks),

which may expose us to litigation and potential liability or require or lead us to terminate relationships with them;

a current or future third party is involved in a business combination, the collaborator might deemphasize or terminate the

development or commercialization of any product candidate licensed to it by us;

and future relationships may be terminated by the collaborator, and, if terminated, we could be required to raise additional

capital to pursue further development or commercialization of the applicable product candidates.

third parties have, and future third-party collaborators

may have, significant discretion in determining the efforts and resources that they will apply;

current and future third parties may not perform

their obligations as expected;

current and future third parties may not pursue

development and commercialization of any product candidates that achieve regulatory approval or may elect not to continue

or renew development or commercialization programs based on clinical trial results, changes in the third parties’

focus or available funding, or external factors, such as a strategic transaction that may divert resources or create competing

third parties may delay clinical trials, provide

insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct

new clinical trials or require a new formulation of a product candidate for clinical testing;

current and future third parties could independently

develop, or develop with third parties, products that compete directly or indirectly with our products and product candidates

if the third parties believe that the competitive products are more likely to be successfully developed or can be commercialized

under terms that are more economically attractive than ours;

product candidates discovered in collaboration

with us may be viewed by our current or future third parties as competitive with their own product candidates or products,

which may cause such third parties to cease to devote resources to the commercialization of our product candidates;

current and future third parties may fail to

comply with applicable regulatory requirements regarding the development, manufacture, distribution or marketing of a product

candidate or product;

current and future third parties with marketing

and distribution rights to one or more of our product candidates that achieve regulatory approval may not commit sufficient

resources to the marketing and distribution of such product or products;

disagreements with current or future third parties,

including disagreements over proprietary rights, contract interpretation or the preferred course of development, might cause

delays or terminations of the research, development or commercialization of product candidates, might lead to additional responsibilities

for us with respect to product candidates, or might result in litigation or arbitration, any of which would be time-consuming

and expensive;

current and future third parties may not properly

maintain or defend our intellectual property rights or may use our proprietary information in such a way as to invite litigation

that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation;

current and future third parties may infringe

the intellectual property rights of others, which may expose us to litigation and potential liability;

current and future third parties may infringe

regulatory frameworks (such as but not limited to cybersecurity and/or privacy frameworks), which may expose us to litigation

and potential liability or require or lead us to terminate relationships with them;

if a current or future third party is involved

in a business combination, the collaborator might deemphasize or terminate the development or commercialization of any product

candidate licensed to it by us;

current and future relationships may be terminated

by the collaborator, and, if terminated, we could be required to raise additional capital to pursue further development or

commercialization of the applicable product candidates.

our relationships do not result in the successful discovery, development and commercialization of products or if one of our third-party

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Related to Our Operations in Israel

have received, and may continue to receive, Israeli governmental grants to assist in the funding of our research and development

If we lose our funding from these research and development grants, we may encounter difficulties in the funding of

future research and development projects and implementing technological improvements, which would harm our operating results.

December 31, 2019, we had received an aggregate of $2.1 million in the form of grants from the Israeli Innovation Authority (“IIA”).

We were formed as an incubator company as part of the FutuRx incubator, and, until 2017, the majority of our funding was from

IIA grants and funding by the incubator, which is supported by the IIA.

We continued to apply for and receive IIA grants after

we left the incubator.

The requirements and restrictions for such grants are found in the Israel Encouragement of Research and

Development in Industries (the “Research Law”).

Under the Research Law, royalties of 3% to 3.5% on the revenue derived

from sales of products or services developed in whole or in part using these IIA grants are payable to the Israeli government.

We developed both of our platform technologies, at least in part, with funds from these grants, and, accordingly, we would be

obligated to pay these royalties on sales of any of our product candidates that achieve regulatory approval.

As long as the manufacturing

of our product candidates takes place in Israel and no technology funded with IIA grants is sold or out licensed to a non-Israeli

entity, the maximum aggregate royalties paid generally would not exceed 100% of the grants made to us, plus annual interest equal

to the 12-month LIBOR rate applicable to dollar deposits, as published on the first business day of each calendar year.

December 31, 2019, the balance of the principal and interest in respect of our commitments for future payments to the IIA totaled

approximately $2.2 million.

As part of funding our current and planned product development activities, we have submitted follow-up

grant applications for new grants.

grants have funded some of our personnel, development activities with subcontractors, and other research and development costs

and expenses.

However, if these awards are not funded in their entirety or if new grants are not awarded in the future, due to,

for example, IIA budget constraints or governmental policy decisions, our ability to fund future research and development and

implement technological improvements would be impaired, which would negatively impact our ability to develop our product candidates.

Israeli government grants we have received for research and development expenditures restrict our ability to manufacture products

2 unchanged sentences

we may be required to refund grants previously received, together with interest and penalties.

research and development efforts have been financed, in part, through the grants that we have received from the IIA.

We, therefore,

must comply with the requirements of the Research Law.

For the years ended December 31, 2019 and 2018, we recorded grants totaling

$0.3 and $0.6 million, from the IIA, respectively.

The grants represented 2.3% and 6.6% of our gross research and development

expenditures for the years ended December 31, 2019 and 2018, respectively.

research and development efforts have been financed, in part, through the grants that we have received from the Israeli Innovation

Authority, or the IIA..

We, therefore, must comply with the requirements of the Israel Encouragement of Research and Development

in Industries, or the Research Law.

For the years ended December 31, 2020 and 2019, we recorded grants totaling $0.5 million,

$0.3 million, from the IIA, respectively.

The grants represented 2.4% and 2.3% of our gross research and development expenditures

for the years ended December 31, 2020 and 2019, respectively.

the Research Law, we are required to manufacture the major portion of each of our products developed using these grants in the

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and development facilities are located, may adversely affect our results of operations.

headquarters and principal offices and most of our operations are located in the State of Israel.

In addition, all but one of

our key employees and officers are residents of Israel.

Accordingly, political, economic and military conditions in Israel directly

affect our business.

Since the State of Israel was established in 1948, a number of armed conflicts have occurred between Israel

and its neighboring countries.

Our headquarters and principal offices and most of our operations are

located in the State of Israel.

In addition, all but one of our key employees and officers are residents of Israel.

Accordingly, political,

economic and military conditions in Israel directly affect our business.

hostilities involving Israel or the interruption or curtailment of trade between Israel and its present trading partners, or a

2 unchanged sentences

hostilities or other Israeli political or economic factors could harm our operations, product development and results of operations.

Israel has entered into various agreements with Egypt, Jordan and the Palestinian Authority, there has been an increase in unrest

and terrorist activity, which began in October 2000 and has continued with varying levels of severity.

For instance, beginning

in July 2014, for approximately seven weeks, Israel experienced an armed conflict between Israel and Hamas, which included rocket

strikes against civilian targets in various parts of Israel and disrupted day-to-day civilian activity in southern and central

If renewed, such hostilities may negatively affect business conditions in Israel.

In addition, Israel faces threats from

more distant neighbors, in particular, Iran.

Our insurance policies do not cover us for the damages incurred in connection with

these conflicts or for any resulting disruption in our operations.

The Israeli government, as a matter of law, provides coverage

for the reinstatement value of direct damages that are caused by terrorist attacks or acts of war; however, the government

may cease providing such coverage or the coverage might not be enough to cover potential damages.

In the event that hostilities

disrupt the ongoing operation of our facilities or the airports and seaports on which we depend to import and export our supplies

and products, our operations may be materially adversely affected.

Although Israel has entered into various agreements

with Egypt, Jordan and the Palestinian Authority and with various states in the Persian Gulf, there has been a continuous unrest and

terrorist activity with varying levels of severity.

In addition, Israel faces threats from more distant neighbors, in particular, Iran.

Our insurance policies do not cover us for the damages incurred in connection with these conflicts or for any resulting disruption in

our operations.

The Israeli government, as a matter of law, provides coverage for the reinstatement value of direct damages that are

caused by terrorist attacks or acts of war;

however, the government may cease providing such coverage or the coverage might not be enough

to cover potential damages.

In the event that hostilities disrupt the ongoing operation of our facilities or the airports and seaports

on which we depend to import and export our supplies and products, our operations may be materially adversely affected.

addition, since the end of 2010, numerous acts of protest and civil unrest have taken place in several countries in the Middle

East and North Africa, many of which involved significant violence.

The civil unrest in Egypt, which borders Israel, resulted

in the resignation of its president, Hosni Mubarak, and significant changes to the country’s government.

In Syria, also

bordering Israel, a civil war continues to take place.

The ultimate effect of these developments on the political and security

situation in the Middle East and on Israel’s position within the region is not clear at this time.

Such instability may

lead to deterioration in the political and trade relationships that exist between the State of Israel and certain other countries.

East and North Africa, many of which involved significant violence, including in Syria and Egypt that border with Israel.

ultimate effect of these developments on the political and security situation in the Middle East and on Israel’s position

within the region is not clear at this time.

Such instability may lead to deterioration in the political and trade relationships

that exist between the State of Israel and certain other countries.

countries, principally in the Middle East, still restrict doing business with Israel and Israeli companies, and additional countries

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have been recognized by the courts, such as the protection of a company’s trade secrets or other intellectual property.

We have received, and may continue to receive, Israeli governmental

grants to assist in the funding of our research and development activities.

If we lose our funding from these research and development

grants, we may encounter difficulties in the funding of future research and development projects and implementing technological improvements,

which would harm our operating results.

Through December 31, 2020, we had received an aggregate

of $2.7 million in the form of grants from the IIA.

was formed as an incubator company as part of the FutuRx incubator, and,

until 2017, the majority of our funding was from IIA grants and funding by the incubator, which is supported by the IIA.

to apply for and receive IIA grants after we left the incubator.

The requirements and restrictions for such grants are found in the Research

Under the Research Law, royalties of 3% to 3.5% on the revenue derived from sales of products or services developed in whole or in

part using these IIA grants are payable to the Israeli government.

We developed both of our platform technologies, at least in part, with

funds from these grants, and, accordingly, we would be obligated to pay these royalties on sales of any of our product candidates that

achieve regulatory approval.

As long as the manufacturing of our product candidates takes place in Israel and no technology funded with

IIA grants is sold or out licensed to a non-Israeli entity, the maximum aggregate royalties paid generally would not exceed 100% of the

grants made to us, plus annual interest equal to the 12-month LIBOR rate applicable to dollar deposits, as published on the first business

day of each calendar year.

As of December 31, 2020, the balance of the principal and interest in respect of our commitments for future

payments to the IIA totaled approximately $2.3 million.

As part of funding our current and planned product development activities, we

have submitted follow-up grant applications for new grants.

These grants have funded some of our personnel,

development activities with subcontractors, and other research and development costs and expenses.

However, if these awards are not funded

in their entirety or if new grants are not awarded in the future, due to, for example, IIA budget constraints or governmental policy decisions,

our ability to fund future research and development and implement technological improvements would be impaired, which would negatively

impact our ability to develop our product candidates.

operations may be disrupted by the obligations of personnel to perform military service.

9 unchanged sentences

and/or “Preferred Enterprise”

as defined under the Encouragement of Capital Investment Law -1959 (the “Law”)

as defined under the Encouragement of Capital Investment Law -1959, or the “Law,

and its regulations, as amended and, accordingly, could be subject to a reduced corporate tax rate on its income that will meet

7 unchanged sentences

may be difficult to enforce a U.S.

judgment against us or our officers and directors named in this prospectus in Israel or the

United States or to assert U.S.

judgment against us or our officers and directors in Israel or the United States or to assert

securities laws claims in Israel or serve process on our officers and directors.

68 unchanged sentences

or commercial manufacturing.

Related to Our Operations

Related to Our Common Stock

significant number of shares of our Common Stock are subject to issuance upon exercise of outstanding warrants and options, which

upon such exercise may result in dilution to our security holders.

As of December 31, 2020, we had an aggregate of 10,265,418 warrants

outstanding to purchase an aggregate of up to 6,765,418 shares of Common Stock with a weighted average exercise price of $11.09, certain

of which are included in our outstanding units, certain of which were issued in private placements and certain of which are traded on

the NYSE American under the symbol “PHGE.WS,”

or the Outstanding Warrants, in each case subject to adjustment.

To the extent

such warrants are exercised, additional shares of our Common Stock will be issued, which will result in dilution to the then existing

holders of Common Stock and increase the number of shares eligible for resale in the public market.

Sales of substantial numbers of such

shares in the public market could adversely affect the market price of our Common Stock.

addition, as of December 31, 2020, we had outstanding vested and unvested options to purchase 3,569,769 shares of our Common Stock.

To the extent any of these options are exercised, additional shares of Common Stock will be issued that will generally be eligible

for resale in the public market (subject to limitations under Rule 144 under the Securities Act with respect to shares held by

our affiliates), which will result in dilution to our security holders.

We plan to grant additional options and warrants in the

The issuance of additional securities could also have an adverse effect on the market price of our Common Stock.

have never paid dividends on our Common Stock, and we do not anticipate paying any cash dividends on our Common Stock in the foreseeable

have never declared or paid cash dividends on our Common Stock.

We do not anticipate paying any cash dividends on our Common Stock

in the foreseeable future.

We currently intend to retain all available funds and any future earnings to fund the development and

growth of our business.

As a result, capital appreciation, if any, of our Common Stock will be our stockholders’

of gain for the foreseeable future.

may be unable to maintain the listing of our securities in the future.

Common Stock and certain of our warrants currently trade on the NYSE American and our Common Stock currently trades on the Tel

Aviv Stock Exchange.

If our Common Stock or warrants are subsequently delisted, we could face significant material adverse consequences,

a limited availability of market quotations

for our securities;

reduced liquidity with respect to our securities;

a determination that our shares are a “penny

stock,”

which will require brokers trading in our securities to adhere to more stringent rules, possibly resulting in

a reduced level of trading activity in the secondary trading market for our securities;

a limited amount of news and analyst coverage

for the post-transaction company;

a decreased ability to issue additional securities

or obtain additional financing in the future.

As a “smaller reporting company”

we are permitted

to provide less disclosure than larger public companies, which may make our Common Stock less attractive to investors.

We are currently a “smaller reporting company,”

by Rule 12b-2 of the Exchange Act.

As a smaller reporting company, we are eligible to take advantage of certain exemptions from various

reporting requirements applicable to other public companies.

Consequently, it may be more challenging for investors to analyze our results

of operations and financial prospects which may result in less investor confidence.

Investors may find our Common Stock less attractive

as a result of our smaller reporting company status.

If some investors find our Common Stock less attractive, there may be a less active

trading market for our Common Stock and our stock price may be more volatile.

success depends, in part, on our ability to retain key executives and to attract, retain and motivate qualified personnel.

are highly dependent on Jonathan Solomon, our chief executive officer, as well as the other principal members of our management,

scientific and clinical team.

Although we have entered into employment agreements with our executive officers, each of them may

terminate their employment with us at any time.

We do not maintain “key person”

insurance for any of our executives

or other employees.

The loss of the services of any of our executive officers, other key employees, and other scientific and medical

advisors, and our inability to find suitable replacements could result in delays in product development and harm our business.

continued ability to attract, retain and motivate highly qualified management, clinical and scientific personnel and our ability

to develop and maintain important relationships with leading academic institutions, clinicians and scientists is critical to our

Competition for qualified personnel in the biotechnology field is intense, particularly in Israel where our headquarters

We face competition for personnel from other biotechnology and pharmaceutical companies, universities, public and

private research institutions and other organizations.

We also face competition from other more well-funded and well-established

businesses, and we may also be viewed as a riskier choice from a job stability perspective due to our relatively newer status

than longer existing biotech and pharmaceutical companies.

We may not be able to attract and retain qualified personnel on acceptable

terms given the competition for such personnel.

If we are unsuccessful in our retention, motivation and recruitment efforts, we

may be unable to execute our business strategy.

to comply with health and data protection laws and regulations could lead to claims, government enforcement actions (which could

include civil or criminal penalties), regulatory actions, private litigation and/or adverse publicity and could negatively affect

our operating results and business .

may be subject to federal, state and foreign data protection laws and regulations (i.e., laws and regulations that address privacy

and security).

In the United States, numerous federal and state laws and regulations, including federal health information privacy

laws, state consumer privacy laws, state data breach notification laws, state health information privacy laws and federal and

state consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), that govern the collection, use, disclosure

and protection of health-related and other personal information could apply to our operations or the operations of our collaborators.

In addition, we may obtain health information from third parties (including research institutions from which we obtain clinical

trial data) that are subject to privacy and security requirements under the Health Insurance Portability and Accountability Act

of 1996, or HIPAA, as amended by the Health Information Technology for Economic and Clinical Health of 2009, or HITECH.

on the facts and circumstances, we could be subject to criminal penalties if we knowingly obtain, use or disclose individually

identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.

Additional requirements may also be imposed by

international data protection laws.

In this context, Regulation 2016/679 of the GDPR (in addition to many other international

data protection laws) may have an impact on our operations when we collect and/or process personal data of individuals located in the

European Union.

The GDPR has applied since May 25, 2018 (replacing previously applicable data protection frameworks) and has an extraterritorial

The GDPR allows members states to introduce specific requirements in relation to certain areas, including processing of special

categories of data, and we may face further restrictions and non-compliance risks under such national frameworks.

We have not yet assessed

whether its activities might be caught by the GDPR.

of the types of data we collect and process, which may involve health, biometric and genetic data, we may face high risks for

non-compliance with the GDPR rules (or local declinations of GDPR-rules across the different European Union Member States), as

these types of data are considered as special categories of data and are granted higher protection.

The risks are further increased

considering the diverging approach in the European Union as to the rules, requirements and frameworks in relation to the processing

of personal data in clinical trials (in matters such as the choice of the legal basis for the processing of data, the possible

uses of the personal data collected, etc.) and the interplay with other relevant frameworks.

The GDPR introduced stringent data

protection requirements in the European Union, as well as potential fines for noncompliant companies of up to the greater of €20

million or 4% of annual worldwide turnover.

Supervisory authorities also have the ability to restrict our processing activities

if those are deemed not to be in compliance with the GDPR (or local declinations);

this may significantly impact the way we conduct

our activities.

The GDPR imposes numerous requirements for the collection, use and disclosure of personal data, including high

standards for consent to be valid, and specific information to be provided to individuals about how their personal data is used,

the obligation to notify regulators and (in some cases) to communicate to affected individuals of personal data breaches, extensive

new internal privacy governance requirements and obligations to allow individuals to exercise their strengthened privacy rights

(e.g., the right to access, correct and delete their personal data, to withdraw their consent, etc.), and obligations when contracting

with third parties such as service providers, CROs, etc.

In addition, the GDPR includes restrictions on data transfers outside

the European Economic Area, or EEA.

The actual mechanisms made available under GDPR to transfer such personal data have recently

received heightened regulatory and judicial scrutiny.

If we cannot rely on existing mechanisms for transferring personal data

from the EEA, the United Kingdom, or other jurisdictions, we may be unable to transfer personal data in those regions.

the United Kingdom’s vote in favor of exiting the European Union, often referred to as “Brexit,”

uncertainty as to whether or not the United Kingdom data protection legislation will depart from the GDPR and how data transfers

to and from the United Kingdom will be regulated.

and international data protection laws and regulations could require us to take on more onerous obligations in our contracts,

restrict our ability to collect, use and disclose data, or in some cases, impact our ability to operate in certain jurisdictions.

Such laws and regulations could limit our ability to use and share personal or other data, thereby increasing our costs and harming

our business and financial condition.

Failure to comply with U.S.

and international data protection laws and regulations could

result in claims, government enforcement actions (which could include civil or criminal penalties), regulatory actions, private

litigation and/or adverse publicity and could negatively affect our operating results and business.

Moreover, clinical trial subjects

about whom we or our potential collaborators obtain information, as well as the providers who share this information with us,

may contractually limit our ability to use and disclose the information.

Claims that we have violated individuals’

rights, failed to comply with data protection laws, or breached our contractual obligations, even if we are not found liable,

could be expensive and time consuming to defend and could result in adverse publicity that could harm our business.

may be required to disclose personal data pursuant to demands from government agencies, from law enforcement agencies, and from

intelligence agencies.

This disclosure may result in a failure or perceived failure by us to comply with data privacy laws, rules,

and regulations and could result in proceedings or actions against us in the same or other jurisdictions, and could have an adverse

impact on our reputation and brand.

relationships with healthcare providers, physicians and third-party payors will be subject to applicable anti-kickback, fraud

and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual

damages, reputational harm and diminished profits and future earnings .

providers, physicians and third-party payors in the United States and elsewhere play a primary role in the recommendation and

prescription of pharmaceutical products.

Arrangements with third-party payors and customers can expose pharmaceutical manufacturers

to broadly applicable fraud and abuse and other healthcare laws and regulations, including, without limitation, the federal Anti-Kickback

Statute and the federal False Claims Act, or FCA, and foreign equivalent legislation, which may constrain the business or financial

arrangements and relationships through which such companies sell, market and distribute pharmaceutical products.

In particular,

the promotion, sales and marketing of healthcare items and services, as well as certain business arrangements in the healthcare

industry, are subject to extensive laws designed to prevent fraud, kickbacks, self-dealing and other abusive practices.

laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, structuring and commissions,

certain customer incentive programs and other business arrangements generally.

Activities subject to these laws also involve the

improper use of information obtained in the course of patient recruitment for clinical trials.

The applicable federal, state and

foreign healthcare laws and regulations laws that may affect our ability to operate include, but are not limited to:

the federal Anti-Kickback Statute, which prohibits,

among other things, knowingly and willfully soliciting, receiving, offering or paying any remuneration (including any kickback,

bribe or rebate), directly or indirectly, overtly or covertly, in cash or in kind, to induce, or in return for, either the

referral of an individual, or the purchase, lease, order or recommendation of any good, facility, item or service for which

payment may be made, in whole or in part, under a federal healthcare program, such as the Medicare and Medicaid programs.

A person or entity can be found guilty of violating the statute without actual knowledge of the statute or specific intent

to violate it.

In addition, 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 FCA.

The Anti-Kickback Statute has been interpreted to apply to

arrangements between pharmaceutical manufacturers on the one hand and prescribers, purchasers and formulary managers on the

There are a number of statutory exceptions and regulatory safe harbors protecting some common activities from

federal civil and criminal false claims laws

and civil monetary penalty laws, including the FCA, which prohibit, among other things, individuals or entities from knowingly

presenting, or causing to be presented, false or fraudulent claims for payment to, or approval by Medicare, Medicaid or other

federal healthcare programs, knowingly making, using or causing to be made or used a false record or statement material to

a false or fraudulent claim or an obligation to pay or transmit money to the federal government, or knowingly concealing or

knowingly and improperly avoiding or decreasing or concealing an obligation to pay money to the federal government.

Manufacturers

can be held liable under the FCA even when they do not submit claims directly to government payors if they are deemed to “cause”

the submission of false or fraudulent claims.

The FCA also permits a private individual acting as a “whistleblower”

to bring actions on behalf of the federal government alleging violations of the FCA and to share in any monetary recovery;

HIPAA, which created new federal criminal statutes

that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program

or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by,

or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and

knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially

false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare

Similar to the federal Anti-Kickback Statute, a person or entity can be found guilty of violating HIPAA without actual

knowledge of the statute or specific intent to violate it;

HIPAA, as amended by HITECH and their respective

implementing regulations, which impose, among other things, requirements on certain covered healthcare providers, health plans

and healthcare clearinghouses, as well as their respective business associates that perform services for them that involve

the use, or disclosure of, individually identifiable health information relating to the privacy, security and transmission

of individually identifiable health information without appropriate authorization.

HITECH also created new tiers of civil

monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates and gave

state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal

HIPAA laws and seek attorneys’

fees and costs associated with pursuing federal civil actions;

the federal Physician Payment Sunshine Act,

created under the Patient Protection and Affordable Care Act and its implementing regulations, which require manufacturers

of drugs, devices, biologicals and medical supplies for which payment is available under Medicare, Medicaid or the Children’s

Health Insurance Program (with certain exceptions) to report annually to the United States Department of Health and Human

Services information related to payments or other transfers of value made to physicians (defined to include doctors, dentists,

optometrists, podiatrists and chiropractors) and teaching hospitals, as well as ownership and investment interests held by

physicians and their immediate family members;

federal consumer protection and unfair competition

laws, which broadly regulate marketplace activities and activities that potentially harm consumers;

analogous state and foreign laws and regulations,

such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving

healthcare items or services reimbursed by nongovernmental third-party payors, including private insurers, and may be broader

in scope than their federal equivalents;

state and foreign 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

or otherwise restrict payments that may be made to healthcare providers;

state and foreign 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;

and state and foreign laws governing the privacy and security of health information in certain circumstances,

many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance

European Union and other foreign provisions.

distribution of pharmaceutical products is subject to additional requirements and regulations, including extensive recordkeeping,

licensing, storage, security requirements intended to prevent the unauthorized sale of pharmaceutical products and, in some foreign

countries, including the European Union countries, mandatory anti-counterfeit features.

scope and enforcement of each of these laws is uncertain and subject to rapid change in the current environment of healthcare

reform, especially in light of the lack of applicable precedent and regulations.

Federal and state enforcement bodies have recently

increased their scrutiny of interactions between healthcare companies and healthcare providers, which has led to a number of investigations,

prosecutions, convictions and settlements in the healthcare industry.

Ensuring business arrangements comply with applicable healthcare

laws, as well as responding to possible investigations by government authorities, can be time- and resource-consuming and can

divert a company’s attention from the business.

failure to comply with any of these laws or regulatory requirements could subject us to possible legal or regulatory action.

on the circumstances, failure to meet applicable regulatory requirements can result in civil, criminal and administrative penalties,

damages, fines, disgorgement, individual imprisonment, possible exclusion from participation in federal and state funded healthcare

programs, contractual damages and the curtailment or restricting of our operations, as well as additional reporting obligations

and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of noncompliance

with these laws.

Any action for violation of these laws, even if successfully defended, could cause a pharmaceutical manufacturer

to incur significant legal expenses and divert management’s attention from the operation of the business.

Prohibitions or

restrictions on sales or withdrawal of future marketed products could materially affect business in an adverse way.

are subject to a code of business conduct and ethics, but it is not always possible to identify and deter employee misconduct,

and the precautions we take to detect and prevent inappropriate conduct may not be effective in controlling unknown or unmanaged

risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be

in compliance with such laws or regulations.

Efforts to ensure that the our business arrangements will comply with applicable

healthcare laws may involve substantial costs.

It is possible that governmental and enforcement authorities will conclude that

our business practices may not comply with current or future statutes, regulations or case law interpreting applicable fraud and

abuse or other healthcare laws and regulations.

If any such actions are instituted against us, and we are not successful in defending

ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of

civil, criminal and administrative penalties, damages, disgorgement, monetary fines, possible exclusion from participation in

Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future

earnings, and curtailment of our operations, any of which could adversely affect our ability to operate our business and our results

of operations.

In addition, the approval and commercialization of any of our product candidates outside the United States will

also likely subject us to foreign equivalents of the healthcare laws mentioned above, among other foreign laws.

we engage in future acquisitions or strategic partnerships, this may increase our capital requirements, dilute our stockholders,

cause us to incur debt or assume contingent liabilities, and subject us to other risks.

may evaluate various acquisition opportunities and strategic partnerships, including licensing or acquiring complementary products,

intellectual property rights, technologies or businesses.

Any potential acquisition or strategic partnership may entail numerous

risks, including:

increased operating expenses and cash requirements;

the assumption of additional indebtedness or

contingent liabilities;

the issuance of our equity securities;

assimilation of operations, intellectual property

and products of an acquired company, including difficulties associated with integrating new personnel;

the diversion of our management’s attention

from our existing product programs and initiatives in pursuing such a strategic merger or acquisition;

retention of key employees, the loss of key

personnel and uncertainties in our ability to maintain key business relationships;

risks and uncertainties associated with the

other party to such a transaction, including the prospects of that party and their existing products or product candidates

and marketing approvals;

our inability to generate revenue from acquired

technology and/or products sufficient to meet our objectives in undertaking the acquisition or even to offset the associated

acquisition and maintenance costs.

business and operations might be adversely affected by security breaches, including any cybersecurity incidents .

depend on the efficient and uninterrupted operation of our computer and communications systems, and those of our consultants,

contractors and vendors, which we use for, among other things, sensitive company data, including our intellectual property, financial

data and other proprietary business information.

certain of our operations have business continuity and disaster recovery plans and other security measures intended to prevent

and minimize the impact of IT-related interruptions, our IT infrastructure and the IT infrastructure of our consultants, contractors

and vendors are vulnerable to damage from cyberattacks, computer viruses, unauthorized access, electrical failures and natural

disasters or other catastrophic events.

We could experience failures in our information systems and computer servers, which could

result in an interruption of our normal business operations and require substantial expenditure of financial and administrative

resources to remedy.

System failures, accidents or security breaches can cause interruptions in our operations and can result

in a material disruption of our targeted phage therapies, product candidates and other business operations.

The loss of data from

completed or future studies or clinical trials could result in delays in our research, development or regulatory approval efforts

and significantly increase our costs to recover or reproduce the data.

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 confidential or proprietary information,

we could incur regulatory investigations and redresses, penalties and liabilities and the development of our product candidates

could be delayed or otherwise adversely affected.

though we believe we carry commercially reasonable business interruption and liability insurance, we might suffer losses as a

result of business interruptions that exceed the coverage available under our insurance policies or for which we do not have coverage.

For example, we are not insured against terrorist attacks or cyberattacks.

Any natural disaster or catastrophic event could have

a significant negative impact on our operations and financial results.

Moreover, any such event could delay the development of

our product candidates.

In the ordinary course of our business, we collect and store sensitive

data, including intellectual property, clinical trial data, proprietary business information, personal data and personally identifiable

information of our clinical trial subjects and employees, in our data centers and on our networks.

The secure processing, maintenance

and transmission of this information is critical to our operations.

Attacks upon information technology systems are increasing in their

frequency, levels of persistence, sophistication and intensity, and are being conducted by sophisticated and organized groups and individuals

with a wide range of motives and expertise.

As a result of the COVID-19 pandemic, we may also face increased cybersecurity risks due to

our reliance on internet technology and the number of our employees who are working remotely, which may create additional opportunities

for cybercriminals to exploit vulnerabilities.

Because the techniques used to obtain unauthorized access to, or to sabotage, systems change

frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or implement

adequate preventative measures.

We may also experience security breaches that may remain undetected for an extended period.

security measures, our information technology and infrastructure may be vulnerable to attacks by hackers or internal bad actors, or breached

due to employee error, a technical vulnerability, malfeasance or other disruptions.

We have experienced and expect to continue to experience

actual and attempted cyber-attacks of our IT networks, such as through phishing scams and ransomware.

Although none of these actual or

attempted cyber-attacks has had a material adverse impact on our operations or financial condition, we cannot guarantee that any such

incidents will not have such an impact in the future.

incur significant costs operating as a public company.

a public company, we incur significant legal, accounting and other expenses.

We are subject to the reporting requirements of the

Securities Exchange Act of 1934, as amended (the “Exchange Act”), which require, among other things, that we file

with the SEC annual, quarterly and current reports with respect to our business and financial condition.

In addition, the Sarbanes-Oxley

Act, as well as rules subsequently adopted by the SEC and the NYSE American to implement provisions of the Sarbanes-Oxley Act,

the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and the Public Company Accounting

Oversight Board impose significant requirements on public companies, including requiring the establishment and maintenance of

effective disclosure and financial controls and changes in corporate governance practices.

These expenses will likely increase

in the future, particularly after we cease to be an “emerging growth company”

if we are also no longer a “smaller

reporting company”

as a result of additional corporate governance and disclosure requirements under the Sarbanes-Oxley Act,

the Dodd-Frank Act, and SEC rules and regulations.

a public company, we incur significant costs in connection with our directors and officers insurance, paying for service providers

such as legal and accounting as well as other expenses.

We are subject to the reporting requirements of the Exchange Act, which

require, among other things, that we file with the SEC annual, quarterly and current reports with respect to our business and

financial condition.

In addition, the Sarbanes-Oxley Act, as well as rules subsequently adopted by the SEC and the NYSE American

to implement provisions of the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the Dodd-Frank

Act, and the Public Company Accounting Oversight Board impose significant requirements on public companies, including requiring

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

These expenses will likely increase in the future, particularly after we cease to be an “emerging growth company”

if we are also no longer a “smaller reporting company”

as a result of additional corporate governance and disclosure

requirements under the Sarbanes-Oxley Act, the Dodd-Frank Act, and SEC rules and regulations.

rules and regulations applicable to public companies result in us continuing to incur substantial legal and financial compliance

These costs increase our net loss or decrease any net income and may require us to reduce costs in other areas of our business.

management is required to devote substantial time to maintaining and improving our internal controls over financial reporting

and the requirements of being a public company which may, among other things, strain our resources, divert management’s

attention and affect our ability to accurately report our financial results and prevent fraud.

are be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and the rules of the NYSE American.

Sarbanes-Oxley Act requires, among other things, that a company maintain effective disclosure controls and procedures (“DCP”)

and internal controls over financial reporting (“ICFR”).

Our management and other personnel have limited experience

operating as a public company, which may result in operational inefficiencies or errors, or a failure to improve or maintain effective

ICFR and DCP necessary to ensure timely and accurate reporting of operational and financial results.

Our existing management team

will need to devote a substantial amount of time to these compliance initiatives, and may need to add personnel in areas such

as accounting, financial reporting, investor relations and legal in connection with operations as a public company.

Ensuring that

the we have adequate internal financial and accounting controls and procedures in place is a costly and time-consuming effort

that needs to be re-evaluated frequently.

Our compliance with existing and evolving regulatory requirements will result in increased

administrative expenses and a diversion of management’s time and attention.

to Sections 302 and 404 of the Sarbanes-Oxley Act (“Section 404”), we are required to furnish certain certifications

and reports by our management on our ICFR, which, after we are no longer an emerging growth company and if we become an accelerated

or large accelerated filer under SEC rules, must be accompanied by an attestation report on ICFR issued by our independent registered

public accounting firm.

To achieve compliance with Section 404 within the prescribed period, we are documenting and evaluating

our ICFR, which is both costly and challenging.

Implementing any appropriate changes to our internal controls may require specific

compliance training for our directors, officers and employees, entail substantial costs to modify our existing accounting systems,

and take a significant period of time to complete.

Such changes may not, however, be effective in maintaining the adequacy of

our ICFR, and any failure to maintain that adequacy, or consequent inability to produce accurate financial statements on a timely

basis, could increase our operating costs and could materially impair our ability to operate our business.

Moreover, effective

internal controls are necessary for us to produce reliable and timely financial reports and are important to help prevent fraud.

Any failure by us to file our periodic reports in a timely manner may cause investors to lose confidence in our reported financial

information and may lead to a decline in the price of our Common Stock.

accordance with NYSE American rules, we are required to maintain a majority independent Board of Directors.

The various rules

and regulations applicable to public companies make it more difficult and more expensive to maintain directors’

and officers’

liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to maintain coverage.

If we are unable to maintain adequate directors’

and officers’

insurance, our ability to recruit and retain qualified

officers and directors will be significantly curtailed.

need to grow the size of our organization and may experience difficulties in managing this growth.

our research, development, manufacturing and commercialization plans and strategies develop as a public company, we need additional

managerial, operational, sales, marketing, financial and other personnel.

Future growth would impose significant added responsibilities

on members of management, including:

recruiting, compensating, integrating, maintaining and motivating additional employees;

our internal research and development efforts effectively, including identification of clinical candidates, scaling our manufacturing

process and navigating the clinical and FDA review process for our product candidates;

our operational, financial and management controls, reporting systems and procedures.

future financial performance and our ability to commercialize our product candidates will depend, in part, on our ability to effectively

manage any future growth, and our management may also have to divert a disproportionate amount of our attention away from day-to-day

activities in order to devote a substantial amount of time to managing these growth activities.

we are not able to effectively expand our organization by hiring new employees and expanding our groups of consultants and contractors,

we may not be able to successfully implement the tasks necessary to further develop and commercialize our product candidates and,

accordingly, may not achieve our research, development and commercialization goals.

are an “emerging growth company,”

and we cannot be certain that the reduced disclosure requirements applicable to

“emerging growth companies”

will not make our Common Stock less attractive to investors.

are an “emerging growth company,”

as defined under the JOBS Act.

For so long as we are an emerging growth company,

we intend to take advantage of certain exemptions from reporting requirements that are applicable to other public companies that

are not emerging growth companies, including, but not limited to, compliance with the auditor attestation requirements of Section

404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy

statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder

approval of any golden parachute payments not previously approved.

could be an emerging growth company for up to five years from the end of our most recently completed fiscal year, although we

may lose such status earlier, depending on the occurrence of certain events, including when we have generated total annual gross

revenue of at least $1.07 billion or when we are deemed to be a “large accelerated filer”

under the Exchange Act,

which means that the market value of our Common Stock that is held by non-affiliates exceeds $700 million as of June 30 of the

prior year, as determined each December 31, or when we have issued more than $1.0 billion in nonconvertible debt securities during

the prior three-year period.

cannot predict if investors will find our securities less attractive or our company less comparable to certain other public companies

because we rely on these exemptions.

If some investors find our securities less attractive as a result, there may be a less active

trading market for our securities, and the trading prices of our securities may be more volatile.

the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment

of the JOBS Act until such time as those standards apply to private companies.

We have irrevocably elected not to avail ourselves

of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting

standards as other public companies that are not emerging growth companies.

a “smaller reporting company”

we are permitted to provide less disclosure than larger public companies, which may

make our Common Stock less attractive to investors.

are currently a “smaller reporting company,”

as defined by Rule 12b-2 of the Exchange Act.

As a smaller reporting

company, we are eligible to take advantage of certain exemptions from various reporting requirements applicable to other public

Consequently, it may be more challenging for investors to analyze our results of operations and financial prospects

which may result in less investor confidence.

Investors may find our Common Stock less attractive as a result of our smaller reporting

company status.

If some investors find our Common Stock less attractive, there may be a less active trading market for our Common

Stock and our stock price may be more volatile.

may be unable to maintain the listing of our securities in the future.

Common Stock currently trades on the NYSE American.

If our Common Stock is subsequently delisted, we could face significant material

adverse consequences, including:

limited availability of market quotations for our securities;

liquidity with respect to our securities;

determination that our shares are a “penny stock,”

which will require brokers trading in our securities to adhere

to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our

limited amount of news and analyst coverage for the post-transaction company;

decreased ability to issue additional securities or obtain additional financing in the future.

a minority share position may reduce the influence that our current stockholders have on our management.

current public stockholders own approximately 13% of the outstanding Public Shares, our current directors, officers and affiliates

own approximately 45% of the outstanding Public Shares, and BiomX Ltd.

former stockholders own approximately 76% of the outstanding

Public Shares.

The minority position of our public stockholders gives them limited influence over the management and operations

of the company.

Related to Our Common Stock

price of our Common Stock is volatile like the stocks of other biotechnology companies.

of a substantial number of shares of our Common Stock in the public market by our existing stockholders could cause our stock

price to decline.

of a substantial number of shares of our Common Stock in the public market or the perception that these sales might occur, could

depress the market price of our Common Stock and could impair our ability to raise capital through the sale of additional equity

We are unable to predict the effect that sales may have on the prevailing market price of our Common Stock.

market price of our Common Stock and other securities may be volatile and fluctuate substantially, which could result in substantial

losses for purchasers of our common stock.

stock markets in general and the markets for biotechnology stocks have experienced extreme volatility.

4 unchanged sentences

addition to the factors discussed in this “Risk Factors”

section, price declines in our Common Stock could also result

from general market and economic conditions and a variety of other factors, including:

results or delays in our clinical trials;

actions taken by regulatory agencies with respect to our product candidates, clinical trials or the manufacturing processes

of our product candidates;

announcements

of technological innovations, patents or new products by our competitors;

developments in the United States and foreign countries;

lawsuit involving us or our product candidates;

announcements

concerning our competitors, or the biotechnology or pharmaceutical industries in general;

concerning any strategic alliances or acquisitions we may enter into;

or anticipated variations in our operating results;

in recommendations by securities analysts or lack of analyst coverage;

in our operating results from the estimates of analysts;

inability, or the perception by investors that we will be unable, to continue to meet all applicable requirements for continued

listing of our Common Stock on the NYSE American, and the possible delisting of our Common Stock;

of our Common Stock by our executive officers, directors and principal stockholders or sales of substantial amounts of Common

of any of our key scientific or management personnel.

section, price declines in our Common Stock (and other securities)

could also result from general market and economic conditions and a variety of other factors, including:

adverse results or delays in our clinical trials;

adverse actions taken by regulatory agencies

with respect to our product candidates, clinical trials or the manufacturing processes of our product candidates;

announcements of technological innovations,

patents or new products by our competitors;

regulatory developments in the United States

and foreign countries;

any lawsuit involving us or our product candidates;

announcements concerning our competitors, or

the biotechnology or pharmaceutical industries in general;

developments concerning any strategic alliances

or acquisitions we may enter into;

actual or anticipated variations in our operating

changes in recommendations by securities analysts

or lack of analyst coverage;

deviations in our operating results from the

estimates of analysts;

our inability, or the perception by investors

that we will be unable, to continue to meet all applicable requirements for continued listing of our Common Stock on the NYSE

American, and the possible delisting of our Common Stock;

sales of our Common Stock by our executive officers,

directors and principal stockholders or sales of substantial amounts of Common Stock;

loss of any of our key scientific or management

Additionally,

4 unchanged sentences

Furthermore, our business may be adversely impacted by risks, or the public perception of the risks, related

to a pandemic or other health crisis, such as the recent outbreak of novel coronavirus (COVID-19).

A significant outbreak of contagious

diseases could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries,

resulting in an economic downturn.

to a pandemic or other health crisis, such as the COVID-19.

A significant outbreak of contagious diseases could result in a widespread

health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn.

the past, following periods of volatility in the market price of a particular company’s securities, litigation has often

2 unchanged sentences

affect our business.

the Business Combination’s benefits do not meet the expectations of investors or securities analysts, the market price of

our securities may decline.

the benefits of the Business Combination do not meet the expectations of investors or securities analysts, the market price of

our securities may decline.

Fluctuations in the price of our securities could contribute to the loss of all or part of your investment.

Our securities may trade at prices significantly below the price you paid for them.

In such circumstances, the trading price of

our securities may not recover and may experience a further decline, which could have a material adverse effect on your investment

in our securities.

securities or industry analysts do not publish research or publish unfavorable research about our business, our stock price and

3 unchanged sentences

Securities and industry analysts do not currently, and may never, publish

research on the company.

If no securities or industry analysts commence coverage of our company, our stock price and trading volume

could be negatively impacted.

If any of the analysts who may cover the company change their recommendation regarding our stock

adversely, provide more favorable relative recommendations about our competitors or publishes inaccurate or unfavorable research

about our business, our stock price would likely decline.

If any analyst who may cover us ceases coverage of us or fails to publish

reports on us regularly, demand for our stock could decrease, which could cause our stock price and trading volume to decline.

may fail to realize any or all of the anticipated benefits of the Business Combination.

success of the Business Combination depends, in part, on our ability to successfully manage and deploy the cash received upon

the consummation of the Business Combination.

Although we intend to use the cash received upon the consummation of the Business

Combination for the continued development of our product candidates, there can be no assurance that we will be able to achieve

our intended objectives.

price of our Common Stock is subject to increased volatility and the Rule 144 resale exemption is unavailable for our securities

because the Business Combination resulted in a merger with a special purpose acquisition company.

Business Combination resulted in our merging with a special purpose acquisition company (“SPAC”), which can cause

additional volatility in the price of our Common Stock.

We expect that the price of our Common Stock and of that of SPACs in general

may be more volatile compared to the stock price of an operating company.

144 of the Securities Act provides a safe harbor under which holders of restricted securities and affiliates of an issuer may

resell their securities into the public market.

However, Rule 144 is unavailable for securities of former SPACs until, among other

things, twelve months have elapsed since the former SPAC has filed “Form 10 information”

with the SEC.

After the completion

of the Business Combination, our stockholders may not rely on Rule 144 for resales of their common stock for a minimum of one

year, which can impair the ability to resell our Common Stock at a favorable return.

current unavailability and potential future unavailability of the Rule 144 resale exemption for our Common Stock could have an

adverse effect on the market price of our Common Stock.

significant number of shares of our Common Stock are subject to issuance upon exercise of outstanding warrants and options, which

upon such exercise may result in dilution to our security holders.

outstanding Warrants are exercisable at a price of $11.50 per share of Common Stock, subject to adjustment.

Public Warrants may

be exercised only for a whole number of shares of our Common Stock.

Private Placement Warrants are exercisable on a cashless basis

and are non-redeemable so long as they are held by the initial purchasers or their permitted transferees.

To the extent such Warrants

are exercised, additional shares of our Common Stock will be issued, which will result in dilution to the then existing holders

of Common Stock and increase the number of shares eligible for resale in the public market.

Sales of substantial numbers of such

shares in the public market could adversely affect the market price of our Common Stock.

addition, as of the date of this Annual Report, we had outstanding vested and unvested options to purchase 3,084,451 shares

of our Common Stock and vested and unvested Warrants to purchase 601,971 shares of our Common Stock.

To the extent any of these

options or Warrants are exercised, additional Public Shares will be issued that will generally be eligible for resale in the public

market (subject to limitations under Rule 144 under the Securities Act with respect to shares held by our affiliates), which will

result in dilution to our security holders.

We plan to grant additional options and warrants in the future.

The issuance of additional

securities could also have an adverse effect on the market price of our Common Stock.

have never paid dividends on our Common Stock, and we do not anticipate paying any cash dividends on our Common Stock in the foreseeable

have never declared or paid cash dividends on our Common Stock.

We do not anticipate paying any cash dividends on our Common Stock

in the foreseeable future.

We currently intend to retain all available funds and any future earnings to fund the development and

growth of our business.

As a result, capital appreciation, if any, of our Common Stock will be our stockholders’

of gain for the foreseeable future.

of a substantial number of shares of our Common Stock in the public market by our existing stockholders could cause our stock

price to decline.

of a substantial number of shares of our Common Stock in the public market or the perception that these sales might occur, could

depress the market price of our Common Stock and could impair our ability to raise capital through the sale of additional equity

We are unable to predict the effect that sales may have on the prevailing market price of our Common Stock.

research on us.

If no securities or industry analysts commence coverage of our company, our stock price and trading volume could

be negatively impacted.

If any of the analysts who may cover us change their recommendation regarding our stock adversely, provide

more favorable relative recommendations about our competitors or publishes inaccurate or unfavorable research about our business,

our stock price would likely decline.

If any analyst who may cover us ceases coverage of us or fails to publish reports on us

regularly, demand for our stock could decrease, which could cause our stock price and trading volume to decline.

UNRESOLVED STAFF COMMENTS

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