What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2026-03-26 compared with 2025-03-13 · 199 added, 169 removed, 576 unchanged (39% of the section changed)

Investing in our securities involves a high degree of risk.

You should carefully consider the risk factors discussed below as well as other information we include in this Annual Report, including our consolidated financial statements and the related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” If any of the following risks occur, our business, financial condition, results of operations and prospects could be materially and adversely affected.

In that case, the market price of our securities could decline and you could lose all or part of your investment.

Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also materially harm our business, operating results and financial condition and could result in a complete loss of your investment.

This Annual Report also contains forward-looking statements that involve risks and uncertainties.

Our results could materially differ from those anticipated in these forward-looking statements as a result of certain factors including the risks described below and elsewhere in this Annual Report and our other SEC filings.

For a summary of the risk factors included in this Item 1A and for further details on our forward-looking statements, see “Cautionary Note Regarding Forward-Looking Statements and Summary of Risk Factors” on page 1.

This section describes the material risks to our business, which should be considered carefully in addition to the other information in this Annual Report and our other filings with the SEC.

Investors should be aware that it is not possible to predict or identify all such factors and that the following is not meant to be a complete discussion of all potential risks or uncertainties.

References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred in the past or their likelihood of occurring in the future.

Additionally, our business is subject to general risks applicable to any company, such as economic conditions, geopolitical events, extreme weather and natural disasters.

If known or unknown risks or uncertainties materialize, our business operations, financial condition, results of operations and prospects could be adversely affected now and in the future, potentially in a material way.

The following discussion of risk factors contains forward-looking statements, as discussed in the “Cautionary Note Regarding Forward-Looking Statements and Summary of Risk Factors” section on page 1.

Risks Related to Our Financial Position and Capital Requirements

2 unchanged sentences

As such, we have a limited operating history and our operations are subject to all of the risks inherent in the establishment of a new business enterprise, including a lack of operating history.

Since inception, our operations have been primarily limited to acquiring and licensing intellectual property rights, undertaking research and conducting preclinical and clinical studies for our initial programs and negotiating and executing the Merger and financings.

Since inception, our operations have been primarily limited to acquiring and licensing intellectual property rights, undertaking research and conducting pre-clinical and clinical studies for our initial programs and negotiating and executing the Merger and financings.

We have not yet obtained regulatory approval for any product candidates.

2 unchanged sentences

Since we have a limited operating history, we cannot assure you that our business will be profitable or that we will ever generate sufficient revenues to meet our expenses and support our anticipated activities.

In addition, there is no guarantee that any of our product candidates with ever receive approval from the U.S.

Food and Drug Administration, or the “FDA.” We cannot be certain that our business strategy will be successful or that we will be solvent at any particular time.

In addition, there is no guarantee that any of our product candidates will ever receive approval from the FDA.

We cannot be certain that our business strategy will be successful or that we will be solvent at any particular time.

Our likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the early stages of the development of any company.

4 unchanged sentences

We may never successfully commercialize our products and our business may fail.

We must raise additional capital to fund our operations in order to continue as a going concern.

At December 31, 2025, we had an accumulated deficit of approximately $71.0 million, cash and cash equivalent balances totaling $3.8 million and investments of $14.9 million.

Based on our current business plans and cash, cash equivalents and investments on hand, management has concluded that there is substantial doubt about our ability to continue as a going concern for a period of at least one year from the issuance of the audited consolidated financial statements included in this Annual Report.

Our auditor also included an explanatory paragraph in its report on our financial statements as of and for the year ended December 31, 2025 with respect to this uncertainty.

There can be no assurance that funding will be available on acceptable terms on a timely basis, or at all.

The various ways that we could raise capital carry potential risks or uncertainties.

Any additional sources of financing will likely involve the issuance of our equity securities, which will have a dilutive effect on our shareholders.

Any debt financing, if available, may involve restrictive covenants that may impact our ability to conduct our business.

Any exercise of our outstanding warrants is at the discretion of the warrant holders and is dependent, in part, upon the market price of our ADSs.

There can be no assurance that any of our outstanding warrants will ever be in-the-money prior to their expiration and, as such, our outstanding warrants may expire without being exercised.

If we raise funds through collaborations and licensing arrangements, we might be required to relinquish valuable rights to our technologies, future revenue streams, research programs or proposed products, or to grant licenses on terms that may not be favorable

Our outstanding warrants may not be exercised or may not be exercised in full.

As such, we cannot conclude that funding will be available on acceptable terms on a timely basis, or at all.

If we are unable to obtain additional funding when it becomes necessary, we may have to significantly limit our operations, the development of our product candidates will be impacted and we would likely be forced to delay, reduce, or terminate some or all of our development programs, all of which could have a material adverse effect on our business, results of operations and financial condition.

The Company is subject to risks common to late-stage clinical specialty pharmaceutical companies including, but not limited to, unanticipated clinical trial costs and the ability to estimate such occurrences, if any, on our cash, liquidity, additional financing requirements, and availability.

We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates, which we expect will take a number of years and is subject to significant uncertainty.

If we are unable to improve our liquidity position, we may not be able to continue as a going concern.

Our ability to continue as a going concern is dependent upon our ability to generate revenue and raise capital from financing transactions.

There can be no assurance that we will be successful in accomplishing these objectives.

Without such additional capital, we may be required to curtail or cease operations and be required to realize our assets and discharge our liabilities other than in the normal course of business which could cause investors to suffer the loss of all or a substantial portion of their investment.

We have incurred significant losses since our inception and have limited cash available for our operations.

1 unchanged sentence

We have incurred net losses every year since inception and we have an accumulated deficit of approximately $71.0 million at December 31, 2025.

We have historically funded our operations through debt and equity financings.

At December 31, 2024, we had cash balances totaling $3.6 million and investments of $10.4 million.

We believe that we have sufficient cash for operating our business for at least the next twelve months from the date of filing this Form 10-K.

However, we are subject to risks common to late-stage clinical specialty pharmaceutical companies including, but not limited to, unanticipated or higher than expected clinical trial costs and the ability to estimate such occurrences, if any, on our cash, liquidity, additional financing requirements, and availability.

Accordingly, we may need to raise additional funds during this period.

We have devoted a majority of our financial resources to research and development, including our preclinical and ongoing clinical development activities.

To date, we have funded our operations primarily through our founders’ funding expenditures and the sale of equity and convertible securities.

We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates or these candidates participate in Early Access or Named Patient programs, which we expect will take a number of years and is subject to significant uncertainty.

Additional financing will be required to complete the research and development of our product candidates and our other operating requirements, which may not be available at acceptable

terms, if at all.

If we are unable to obtain additional funding when it becomes necessary, the development of our product candidates will be impacted and we would likely be forced to delay, reduce, or terminate some or all of our development programs, all of which could have a material adverse effect on our business, results of operations and financial condition.

We have historically funded our operations through our founders’ funding expenditures and debt and equity financings.

We have devoted a majority of our financial resources to research and development, including our pre-clinical and ongoing clinical development activities.

We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future.

1 unchanged sentence

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

● continue and/or initiate clinical development of our product candidates, including—QRX003—a topical lotion comprised of a broad-spectrum serine protease inhibitor, formulated with the proprietary Invisicare ® technology, which is under clinical development as a potential treatment for Netherton Syndrome (“NS”);

● continue and/or initiate clinical development of our product candidates, including—QRX003—a topical lotion comprised of a broad-spectrum serine protease inhibitor, which is under clinical development as a potential treatment for NS;

● further enhance our internal control systems;

2 unchanged sentences

● seek marketing approvals for our product candidates that successfully complete clinical trials;

● ultimately establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain marketing approval;

● establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain marketing approval;

● maintain, expand and protect our intellectual property portfolio;

1 unchanged sentence

● create additional infrastructure to support our operations and our product development and planned future commercialization efforts.

We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates or these candidates participate in early access or named patient programs, which is subject to significant uncertainty.

Additional financing will be required to complete the research and development of our product candidates and to fund our other operating requirements, which may not be available at acceptable terms, if at all.

We have never generated any revenue from product sales or any other sources since inception, and may never be profitable.

2 unchanged sentences

Our ability to generate future revenues from product sales depends heavily on our success in:

● completing our research and preclinical development of product candidates;

● completing our research and pre - clinical development of product candidates;

● initiating and completing clinical trials for product candidates with favorable results;

9 unchanged sentences

We expect that we will need to raise additional capital, which may not be available on acceptable terms, or at all.

Developing pharmaceutical products, including conducting preclinical studies and clinical trials, is expensive.

We expect our research and development expenses to substantially increase in connection with our ongoing activities, particularly as we advance our product candidates towards or through clinical trials.

Developing pharmaceutical products, including conducting pre-clinical studies and clinical trials, is expensive.

We may need to raise additional capital to support our operations and such funding may not be available to us on acceptable terms, or at all.

We cannot provide assurances 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.

For example, our preclinical or clinical trials may encounter technical difficulties or be subject to delays or other issues.

For example, our pre-clinical or clinical trials may encounter technical difficulties or be subject to delays or other issues.

Any of these events may increase our development costs more than we expect.

In order to support our long-term plans, we may need to raise additional capital or otherwise obtain funding through additional strategic alliances if we choose to initiate preclinical or clinical trials for new product candidates other than programs currently partnered.

In order to support our long-term plans, we may need to raise additional capital or otherwise obtain funding through additional strategic alliances if we choose to initiate pre-clinical or clinical trials for new product candidates other than programs currently partnered.

In any event, we will require additional capital to obtain regulatory approval for, and to commercialize, future product candidates.

6 unchanged sentences

If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we will be prevented from pursuing development and commercialization efforts, which will have a material adverse effect on our business, operating results and prospects.

The terms of our October 2025 private placement may make it difficult for us to procure additional financing.

The securities purchase agreement, dated October 10, 2025, by and among us and the purchasers (the “October Purchasers”) named therein (the “October 2025 Purchase Agreement”), that we entered into in connection with the October 2025 Private Placement (as defined herein) contains, among others, the following restrictive covenants:

(i) we are prohibited from entering into variable rate financings until April 12, 2026;

and (ii) we are prohibited from entering into any equity financings at an effective price per ADS or Ordinary Share that is less than the unit purchase price with respect to the October 2025 Private Placement until June 2, 2026.

The October 2025 Purchase Agreement further provides that the purchasers thereunder have a right of participation in certain subsequent financings by us or any of our subsidiaries in an amount equal to up to an aggregate of 25% of such subsequent financings for 12 months following the date of the October 2025 Purchase Agreement.

To the extent we require additional funding, we will therefore be limited in the types of fundraising transactions that we are able to pursue in compliance with the October 2025 Purchase Agreement.

If we require additional funding while these restrictive covenants remain in effect, we may be unable to effect a financing transaction on terms acceptable to us, or at all, while also remaining in compliance with the terms of the October 2025 Purchase Agreement, or we may be forced to seek a waiver from the October Purchasers, which such they are not obligated to grant to us.

Risks Related to the Discovery and Development of Product Candidates

Preclinical and clinical studies of our product candidates may not be successful.

If we are unable to generate successful results from preclinical and clinical studies of our product candidates, or experience significant delays in doing so, our business may be materially harmed.

We have no products approved for commercial marketing and most of our product candidates are in preclinical and clinical development as is the case with our lead asset for NS, which is currently being tested in four separate clinical studies in NS patients.

Moreover, the clinical development process can take several years, and there is no assurance that our clinical trials will be successful or that we will obtain marketing approvals for any of our product candidates from either the FDA or the EMA.

Pre-clinical and clinical studies of our product candidates may not be successful.

If we are unable to generate successful results from pre-clinical and clinical studies of our product candidates, or experience significant delays in doing so, our business may be materially harmed.

We have no products approved for commercial marketing and most of our product candidates are in pre-clinical and clinical development as is the case with our lead asset for NS, which is currently being tested in four separate clinical studies in NS patients.

Our ability to achieve and sustain profitability depends on obtaining regulatory approvals for and, if approved, successfully commercializing our product candidates, either alone or with third parties.

Before obtaining regulatory approval for the commercial distribution of our product candidates, we or an existing or future collaborator must conduct extensive preclinical tests and clinical trials to demonstrate the safety and efficacy of our product candidates.

Before obtaining regulatory approval for the commercial distribution of our product candidates, we or an existing or future collaborator must conduct extensive pre-clinical tests and clinical trials to demonstrate the safety and efficacy of our product candidates.

The success of our product candidates will depend on several factors, including the following:

● successfully implementing preclinical studies which may be predictive of clinical outcomes;

● successfully implementing pre - clinical studies which may be predictive of clinical outcomes;

● successful enrollment in clinical trials and completion of those trials with favorable results;

16 unchanged sentences

A failure of one or more clinical trials can occur at any stage of testing.

The outcome of preclinical studies and early clinical trials may not be predictive of the success of later clinical trials, and preliminary results or planned interim analyses of a clinical trial do not necessarily predict final results.

Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain marketing approval for their products.

The outcome of pre-clinical studies and early clinical trials may not be predictive of the success of later clinical trials, and preliminary results or planned interim analyses of a clinical trial do not necessarily predict final results.

Moreover, pre-clinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in pre-clinical studies and clinical trials have nonetheless failed to obtain marketing approval for their products.

Events which may result in a delay or unsuccessful completion of clinical development include:

● delays in reaching an agreement with the FDA or other regulatory authorities on final trial design, including selection of dose and clinical outcome assessments and related efficacy endpoints

● delays in reaching an agreement with the FDA or other regulatory authorities on final trial design, including selection of control dose and efficacy endpoints such as clinical outcome assessments

● delays in obtaining from the FDA, or comparable foreign regulatory authority, authorization to administer an investigational new drug product to humans through the submission or acceptance of an IND or similar foreign application;

22 unchanged sentences

We do not know whether any clinical trials will begin as planned, will need to be restructured or will be completed on schedule, or at all.

Significant clinical trial delays also 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, which would impair our ability to successfully

commercialize our product candidates and may harm our business and results of operations.

Any inability to successfully complete preclinical and clinical development could result in additional costs to us or impair our ability to generate revenues from product sales.

Any inability to successfully complete pre - clinical and clinical development could result in additional costs to us or impair our ability to generate revenues from product sales.

Any of our product candidates may cause undesirable side effects or have other properties impacting safety that could delay or prevent their regulatory approval or limit the scope of any approved label or market acceptance.

13 unchanged sentences

Any of these events could prevent us from achieving or maintaining market acceptance of the affected product and could substantially increase the costs of commercializing our future products and impair our ability to generate revenues from the commercialization of these products.

Even if we complete the necessary preclinical studies and clinical trials, we cannot predict whether or when we will obtain regulatory approval to commercialize a product candidate and we cannot, therefore, predict the timing of any revenue from a future product.

Even if we complete the necessary pre - clinical studies and clinical trials, we cannot predict whether or when we will obtain regulatory approval to commercialize a product candidate and we cannot, therefore, predict the timing of any revenue from a future product.

We cannot commercialize a product until the appropriate regulatory authorities, such as the FDA, have reviewed and approved the product candidate.

1 unchanged sentence

● regulatory authorities disagreeing with the design or implementation of our clinical trials;

● such authorities may disagree with our interpretation of data from preclinical studies or clinical trials;

● such authorities may disagree with our interpretation of data from pre - clinical studies or clinical trials;

● such authorities may not accept clinical data from trials which are conducted at clinical facilities or in countries where the standard of care is potentially different from that of the United States;

3 unchanged sentences

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

● such authorities may not agree that the data collected from clinical trials of our product candidates are acceptable or sufficient to support the submission of a New Drug Application (“NDA”) or other submission or to obtain regulatory approval in the United States or elsewhere, and such authorities may impose requirements for additional preclinical studies or clinical trials;

● such authorities may disagree regarding the formulation, labeling and/or the specifications of our product candidates;

20 unchanged sentences

The occurrence of any event or penalty described above may inhibit our ability to commercialize our future products, if approved, and generate revenues.

We may not be able to obtain or maintain orphan drug designation or exclusivity for our product candidates.

We may not be able to maintain orphan drug designation or obtain orphan drug exclusivity for our product candidates.

Regulatory authorities in some jurisdictions, including the United States, may designate drugs for relatively small patient populations as orphan drugs.

1 unchanged sentence

Orphan drug designation entitles a party to financial incentives, such as tax advantages and user fee waivers.

Additionally, if a product that has orphan designation subsequently receives the first FDA approval for the disease or condition 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 to market the same drug for the same indication for seven years, except in certain circumstances, such as a showing of clinical superiority (i.e., another product is safer, more effective or makes a major contribution to patient care) over the product with orphan exclusivity or where the manufacturer is unable to assure sufficient product quantity.

Additionally, if a product that has orphan designation subsequently receives the first FDA approval for the disease or condition 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 to market the same drug for the same indication for seven years, except in certain circumstances, such as a showing of clinical superiority (i.e., another product is safer, more effective or makes a major contribution to patient care) over the product with orphan exclusivity or where the manufacturer is unable to assure sufficient product quantity.

Competitors, however, may receive approval of different products for the same indication for which the orphan product has exclusivity, or obtain approval for the same product but for a different indication than that for which the orphan product has exclusivity.

We intend to apply for orphan drug designation in the United States for QRX003 for the treatment of NS.

However, obtaining an orphan drug designation can be difficult, and we may not be successful in doing so.

Even if we obtain orphan drug designation for a product candidate in specific indications, we may not be the first to obtain regulatory approval of the product candidate for the orphan-designated indication.

We received orphan drug designation in the United States for QRX003 for the treatment of NS in October 2025.

Even though we obtained orphan drug designation for QRX003 in Netherton Syndrome, we may not be the first to obtain regulatory approval of the product candidate for the orphan-designated indication.

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 orphan designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition.

1 unchanged sentence

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.

We may pursue Rare Pediatric Disease designation for QRX003 for the treatment of NS or other of our product candidates.

There is no assurance that we will obtain such designation.

Moreover, a Rare Pediatric Disease designation by the FDA does not guarantee that the NDA for the product will qualify for a priority review voucher upon approval, and it does not lead to a faster development or regulatory review process, or increase the likelihood that any of our product candidates will receive marketing approval.

Our Rare Pediatric Disease designation from the FDA does not guarantee that the NDA for the product will qualify for a priority review voucher upon approval, and it does not lead to a faster development or regulatory review process, or increase the likelihood that any of our product candidates will receive marketing approval.

Under the Rare Pediatric Disease Priority Review Voucher program, upon the approval of a qualifying NDA for the treatment of a rare pediatric disease, the sponsor of such an application may be awarded a transferable rare pediatric disease priority review voucher that can be used to obtain priority review for a subsequent NDA or BLA.

We intend to pursue Rare Pediatric Disease designation for QRX003 for the treatment of NS, but there is no assurance that we will receive such designation.

Under the current statutory sunset provisions, the FDA may only award a priority review voucher for an approved rare pediatric disease application if the sponsor has a rare pediatric disease designation for a drug that is the subject of an application, and that designation was granted by December 20, 2024.

The drug also must receive FDA approval no later than September 30, 2026 to qualify for the priority review vouchers.

Although legislation to extend the rare pediatric disease priority review voucher program has been proposed, Congress has not yet, and may never, pass a bill to reauthorize the program and extend the sunset dates.

There is no guarantee that the rare pediatric disease priority review voucher program will be extended or that any of our product candidates will obtain such designation and, therefore, we may not be in a position to obtain a priority review voucher.

We were granted Rare Pediatric Disease designation for QRX003 for the treatment of NS by the FDA in June 2025.

Under the current statutory sunset provisions, the FDA may only award a priority review voucher for a rare pediatric disease application approved by September 30, 2029, unless the program is extended.

Additionally, designation of a drug for a rare pediatric disease does not guarantee that an NDA will meet the other eligibility criteria for a rare pediatric disease priority review voucher at the time the application is approved.

12 unchanged sentences

Currently, there are no approved products to treat NS.

However, to our knowledge, there are a number of therapeutic products at various stages of development for the treatment of NS, including candidates from LifeMax Laboratories, Inc., Krystal Biotech, Inc., Sixera Pharmaceuticals, ResVita Bio, and Azitra Inc.

As of now, to the best of our knowledge, out of these companies only Azitra is actively dosing subject in clinical studies on NS patients under an open IND.

ResVita Bio, BioCryst and Azitra Inc.

As of now, to the best of our knowledge, out of these companies only Azitra and BioCryst are actively dosing subjects in clinical studies of NS patients under an open IND.

We face significant competition from other biotechnology and pharmaceutical companies and our operating results will suffer if we fail to compete effectively.

5 unchanged sentences

Our competitors may succeed in developing, acquiring or licensing on an exclusive basis, drug products that are more effective or less costly than any product candidate that we may develop.

All of our product candidates are in either preclinical or clinical development and targeted toward indications for which there may be other product candidates in clinical development.

All of our product candidates are in either pre - clinical or clinical development and targeted toward indications for which there may be other product candidates in clinical development.

We may face competition from other drugs currently approved or that may be approved in the future for the same therapeutic indications as our product candidates.

29 unchanged sentences

With respect to future programs, we may rely completely on an alliance partner for sales and marketing.

In addition, we may enter into strategic alliances with third parties to commercialize other product candidates, if approved, including in markets outside of the United States and Europe or for other large markets that are beyond our resources.

Although we intend to establish a sales organization if we are able to obtain approval to market any product candidates in the United States, and Europe we will also consider the option to enter into strategic alliances for future product candidates in the United States and Europe if commercialization requirements exceed our available resources.

In addition, we may enter into strategic alliances with third parties to commercialize other product candidates, if approved, including in markets outside of the United States, Europe and Japan or for other large markets that are beyond our resources.

Although we intend to establish a sales organization if we are able to obtain approval to market any product candidates in the United States, Europe and Japan we will also consider the option to enter into strategic alliances for future product candidates in the United States, Europe and Japan if commercialization requirements exceed our available resources.

This will reduce the revenue generated from the sales of these products.

Any future strategic alliance partners may not dedicate sufficient resources to the commercialization of our product candidates, if approved, or may otherwise fail in their commercialization due to factors beyond our control.

If we are unable to establish effective alliances to enable the sale of our product candidates, if approved, to healthcare professionals and in geographical regions, including the United States and Europe, that will not be covered by our own marketing and sales force, or if our potential future strategic alliance partners do not successfully commercialize the product candidates that may be approved, our ability to generate revenues from product sales will be adversely affected.

If we are unable to establish effective alliances to enable the sale of our product candidates, if approved, to healthcare professionals and in geographical regions, including the United States, Europe and Japan, that will not be covered by our own marketing and sales force, or if our potential future strategic alliance partners do not successfully commercialize the product candidates that may be approved, our ability to generate revenues from product sales will be adversely affected.

If we are unable to establish adequate sales, marketing and distribution capabilities, whether independently or with third parties, we may not be able to generate sufficient product revenue and may not become profitable.

1 unchanged sentence

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

If we obtain approval to commercialize any approved products outside of the United States and Europe, a variety of risks associated with international operations could materially adversely affect our business.

If we obtain approval to commercialize any approved products outside of the United States and Europe, we expect that we will be subject to additional risks related to entering into international business relationships, including:

If we obtain approval to commercialize any approved products outside of the United States a variety of risks associated with international operations could materially adversely affect our business.

If we obtain approval to commercialize any approved products outside of the United States, we expect that we will be subject to additional risks related to entering into international business relationships, including:

● different regulatory requirements for drug approvals in foreign countries;

10 unchanged sentences

Coverage and adequate reimbursement may not be available for our product candidates, if approved, which could make it difficult for us to sell products profitably.

Market acceptance and sales of any product candidates that we develop will depend on coverage and reimbursement policies and may be affected by future healthcare reform measures.

Government authorities and third-party payors, such as private health insurers, government payors and health maintenance organizations, decide which drugs they will pay for and establish reimbursement levels.

We cannot be sure that coverage and adequate reimbursement will be available for any future product candidates.

In the United States, the Centers for Medicare & Medicaid Services (“CMS”), an agency within the U.S.

Department of Health and Human Services, decides whether and to what extent a new drug will be covered and reimbursed under Medicare.

Private payors tend to follow the coverage reimbursement policies established by CMS to a substantial degree.

It is difficult to predict what CMS will decide with respect to reimbursement for novel product candidates.

Inadequate reimbursement amounts may reduce the demand for, or the price of, our future products.

Further, one payor’s determination to provide coverage for a product does not assure that other payors will also provide coverage for the product.

Market acceptance and sales of any product candidates that we develop will depend on coverage and reimbursement policies from third-party payors, such as government insurance programs, including Medicare and Medicaid, private health insurers, health maintenance organizations and other health care related organizations, who are increasingly challenging the price of medical products and services.

Accordingly, there is significant uncertainty related to the insurance coverage and reimbursement of newly approved products.

Adoption of any drug by the medical community may be limited if third-party payers will not offer adequate coverage.

In the United States, the principal decisions about reimbursement for new products are typically made by CMS.

Private payors tend to follow CMS to a substantial degree.

However, no uniform or consistent policy of coverage and reimbursement for drug products exists among third-party payors.

Therefore, coverage and reimbursement for drug products can differ significantly from payor to payor as well as from state to state.

Consequently, the coverage determination process is often a time-consuming and costly process that must be played out across many jurisdictions and different entities.

Further, a payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved.

Furthermore, coverage policies and third-party reimbursement rates may change at any time and may be affected by future healthcare reform measures.

We cannot be sure that coverage and adequate reimbursement will be available for any future product candidates, if approved.

Even if favorable coverage and reimbursement status is attained for one or more of our product candidates for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

If reimbursement is not available, or is available only at limited levels, we may not be able to successfully commercialize product candidates that we develop and that may be approved.

10 unchanged sentences

The requirements governing drug pricing vary widely from country to country.

For example, the EU provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use.

For example, the EU provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control

the prices of medicinal products for human use.

A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market.

3 unchanged sentences

Risks Related to Our Reliance on Third Parties

We rely on third parties to conduct some aspects of our compound formulation, research and preclinical studies, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such formulation, research or testing.

We do not expect to independently conduct all aspects of our drug development activities, compound formulation research or preclinical studies of product candidates.

We currently rely and expect to continue to rely on third parties to conduct some or all aspects of our preclinical studies and formulation development.

We rely on third parties to conduct some aspects of our compound formulation, research and pre - clinical studies, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such formulation, research or testing.

We do not expect to independently conduct all aspects of our drug development activities, compound formulation research or pre-clinical studies of product candidates.

We currently rely and expect to continue to rely on third parties to conduct some or all aspects of our pre-clinical studies and formulation development.

Any of these third parties may terminate their engagements with us at any time.

1 unchanged sentence

Our reliance on these third parties for research and development activities will reduce our control over these activities but will not relieve us of our responsibilities.

If these third parties do not successfully carry out their contractual duties, meet expected deadlines or conduct our studies in accordance with regulatory requirements or our stated study plans and protocols, we will not be able to complete, or may be delayed in completing, the necessary preclinical studies to enable us to select viable product candidates for IND submissions and will not be able to, or may be delayed in our efforts to, successfully develop and commercialize such product candidates.

We rely, or will rely, on third-party manufacturers to produce the supply of our preclinical product, clinical product candidates and commercial supplies of any approved product candidates.

If these third parties do not successfully carry out their contractual duties, meet expected deadlines or conduct our studies in accordance with regulatory requirements or our stated study plans and protocols, we will not be able to complete, or may be delayed in completing, the necessary pre-clinical studies to enable us to select viable product candidates for IND submissions and we will not be able to, or may be delayed in our efforts to, successfully develop and commercialize such product candidates.

We rely, or will rely, on third-party manufacturers to produce the supply of our pre - clinical product, clinical product candidates and commercial supplies of any approved product candidates.

Reliance on third-party manufacturers entails risks, including risks that we would not be subject to if we manufactured the product candidates ourselves.

14 unchanged sentences

● the lack of qualified backup suppliers for any raw materials that are currently purchased from a single source supplier;

● operations of our third-party manufacturers or suppliers could be disrupted by conditions unrelated to our business or operations, including the bankruptcy of the manufacturer or supplier;

● operations of third-party manufacturers or suppliers could be disrupted by conditions unrelated to our business or operations, including the bankruptcy of the manufacturer or supplier;

● carrier disruptions or increased costs that are beyond our control;

4 unchanged sentences

We have established manufacturing relationships with a limited number of suppliers to manufacture raw materials and the drug substance used to create our product candidates.

The availability of such suppliers to manufacture raw materials and drug substance for our product candidates in sufficient quantities for evaluation in preclinical or clinical studies or, if our product candidates are approved, for commercial supply may be limited.

The availability of such suppliers to manufacture raw materials and drug substance for our product candidates in sufficient quantities for evaluation in pre - clinical or clinical studies or, if our product candidates are approved, for commercial supply may be limited.

Further, each supplier may require licenses to manufacture such components if such processes are not owned by the supplier or in the public domain.

9 unchanged sentences

We may identify significant impurities, which could result in increased scrutiny by the regulatory agencies, delays in clinical programs and regulatory approval, increases in our operating expenses, or failure to obtain or maintain approval for product candidates or any approved products.

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

We intend to rely on CROs and clinical trial sites to ensure the proper and timely conduct of our clinical trials.

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

We currently rely on, and expect to continue to rely on, CROs and clinical trial sites to ensure the proper and timely conduct of our clinical trials.

While we will have agreements governing their activities, we have limited influence over their actual performance.

We will control only certain aspects of our CROs’ activities.

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

We and our CROs will be required to comply with the FDA’s or other regulatory agency’s GCPs, for conducting, recording and reporting the results of IND-enabling studies and clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of clinical trial participants are protected.

We control only certain aspects of our CROs’ activities.

Nevertheless, we are responsible for ensuring that each of our clinical trials are

conducted in accordance with the applicable protocol, legal, regulatory and scientific standards and our reliance on the CROs will not relieve us of our regulatory responsibilities.

We and our CROs are required to comply with the FDA’s or other regulatory agency’s GCPs, for conducting, recording and reporting the results of IND-enabling studies and clinical trials to ensure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of clinical trial participants are protected.

The FDA and non-U.S.

4 unchanged sentences

regulatory agency may determine that our clinical trials did not comply with GCPs.

In addition, our clinical trials will require a sufficiently large number of test subjects to evaluate the safety and effectiveness of a potential drug product.

In addition, our clinical trials require a sufficient number of test subjects to evaluate the safety and effectiveness of a potential drug product.

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

Our CROs will not be our employees, and we will not be able to control whether or not they devote sufficient time and resources to our clinical and nonclinical programs.

These CROs may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials, or other drug development activities which could harm our competitive position.

Our CROs are not our employees, and we are not able to control whether or not they devote sufficient time and resources to our clinical and nonclinical programs.

Our CROs may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials, or other drug development activities which could harm our competitive position.

If our CROs do not successfully carry out their contractual duties or obligations, fail to meet expected deadlines, or if the quality or accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols or regulatory requirements, or for any other reasons, our clinical trials may be extended, delayed or terminated, and we may not be able to obtain regulatory approval for, or successfully commercialize our product candidates.

As a result, our financial results and the

commercial prospects for such products and any product candidates that we develop would be harmed, our costs could increase, and our ability to generate revenues could be delayed.

We intend to rely on other third parties to package, store and deliver drug products to the clinical trial sites for any clinical trials that we may conduct.

As a result, our financial results and the commercial prospects for such products and any product candidates that we develop would be harmed, our costs could increase, and our ability to generate revenues could be delayed.

We also currently rely on, and expect to continue to rely on, other third parties to package, store and deliver drug products to our clinical trial sites.

Any performance failure on the part of these third parties could delay clinical development or marketing approval of our product candidates or commercialization of our products, if approved, producing additional losses and depriving us of potential product revenue.

10 unchanged sentences

We cannot offer any assurances about which, if any, patents will issue or whether any issued patents will be found invalid and unenforceable or will be threatened by third parties.

A patent may be challenged through one or more of several administrative proceedings including post-grant challenges, re-examination or opposition before the USPTO or foreign patent offices.

A patent may be challenged through one or more of several administrative proceedings including post-grant challenges, re-examination or opposition before the United States Patent and Trademark Office (“USPTO”) or foreign patent offices.

Any successful challenge of patents or any other patents owned by or licensed to us could deprive us of rights necessary for the successful commercialization of any product candidates that we may develop.

10 unchanged sentences

Further, if we encounter delays in regulatory approvals, the period of time during which we could market a product candidate under patent protection could be reduced.

One of our patents expired in March 2024 and another is set to expire in July 2025.

One of our patents expired in March 2024 and another in July 2025.

In addition to the protection afforded by patents, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is not patentable, including processes for which patents are difficult to enforce and any other elements of our drug discovery and development processes that involve proprietary know-how, information or technology that is not covered by patents.

Although we expect all our employees to assign their inventions to us, and all our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information or technology to enter into confidential information and invention agreements, we cannot provide any assurances that all such agreements have been or will be duly executed or will be enforceable.

addition, others may independently discover our trade secrets and proprietary information.

In addition, others may independently discover our trade secrets and proprietary information.

For example, the FDA, as part of its Transparency Initiative, is currently considering whether to make additional information publicly available on a routine basis, including information that we may consider to be trade secrets or other proprietary information, and it is not clear at the present time how the FDA’s disclosure policies may change in the future, if at all.

42 unchanged sentences

Other Risks Related to Our Business Operations and Industry

The pausing or termination of government grants by the United States government could have a major effect on the pharmaceutical industry, and as a result, our operations and prospects.

In January 2025, a memo issued by the Office of Management and Budget, had disclosed a freeze on federal loans and grants.

That memo has since been rescinded;

however, future memos, executive orders or other actions by the government could result in the freeze of existing or new grants, or the termination of previously approved grants.

Such actions could have a material adverse effect on the pharmaceutical industry as a whole, a portion of which relies on governmental grants, and as a result, on the Company’s operations and prospects.

Inadequate funding, government shutdowns, workforce reductions or other policy changes affecting the FDA, the SEC or other government agencies could hinder their ability to hire and retain key leadership and other personnel, prevent new products and services from being developed or commercialized in a timely manner or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business.

Our business depends on timely interactions with the FDA, including the review of regulatory submissions, scheduling of formal meetings, and oversight of clinical trials.

Disruptions at the FDA and other federal agencies, including substantial leadership departures, personnel cuts, policy changes and those related to the federal government reductions in force or shutdown, may result in reduced staffing or suspension of non-essential FDA operations, which could delay or cancel meetings with the FDA, hinder regulatory guidance, cause delays in the implementation or enforcement of regulatory requirements in a timely fashion or at all, and postpone the review of IND applications, NDAs, and BLAs.

These disruptions may also affect the initiation, conduct, and monitoring of clinical trials, particularly those requiring FDA authorization or ongoing regulatory engagement.

Interruptions in FDA activities could materially delay our development timelines, increase operational costs, and adversely impact our ability to complete our ongoing and planned clinical trials and to advance product candidates toward approval and commercialization.

Any such delays or uncertainties may have a significant negative effect on our business, financial condition, and results of operations.

In addition, government funding of the FDA, SEC and other government agencies on which our operations may rely, including those that fund research and development activities, is subject to the political process, which is inherently fluid and unpredictable, and spending allocation priorities may undergo significant changes through congressional budgeting and appropriations processes.

Disruptions at the FDA and other agencies may also extend the time necessary for new drugs to be reviewed and/or approved, which would adversely affect our business.

For example, over the last several years, the U.S.

government shut down several times and certain regulatory agencies, such as the FDA and the SEC, had to furlough employees, experience substantial funding cuts and pause or delay critical activities.

If a prolonged government shutdown occurs, it could, for example, significantly impact the ability of (i) the FDA and/or the USPTO to review and process regulatory submissions in a timely matter, and (ii) the National Institutes of Health (“NIH”) to conduct research or provide grants, all of which could have a material adverse effect on our business.

In addition, future government shutdowns could impact our ability to obtain necessary capital in order to properly capitalize and continue our operations.

During such shutdowns, while the SEC’s EDGAR system remains operational, the unavailability of the SEC staff to review filings, issue and resolve comments, or declare registration statements effective may delay our ability to complete public offerings and obtain timely regulatory approvals.

These delays could impact our access to capital markets, hinder strategic transactions, and create uncertainty around our disclosure obligations.

Additionally, the lack of interpretive guidance or exemptive relief during a shutdown may increase legal and compliance risks.

Our future success depends on our ability to attract and retain key executives and to attract, retain and motivate qualified personnel.

5 unchanged sentences

We may not be able to attract and retain personnel on acceptable terms given the competition among numerous pharmaceutical companies for individuals with similar skill sets.

In addition, failure to succeed in preclinical studies and clinical trials may make it more challenging to recruit and retain qualified personnel.

In addition, failure to succeed in pre - clinical studies and clinical trials may make it more challenging to recruit and retain qualified personnel.

The inability to recruit any executive or key employee or the loss of the services of any executive or key employee might impede the progress of our research, development and commercialization objectives.

27 unchanged sentences

Although there are a number of statutory exemptions and regulatory safe harbors protecting certain common activities from prosecution, the exemptions and safe harbors are drawn narrowly, and those activities may be subject to scrutiny or penalty if they do not qualify for an exemption or safe harbor.

A conviction for violation of the Anti-Kickback Statute requires mandatory exclusion from participation in federal healthcare programs.

A conviction for violation of the Anti-Kickback Statute requires

mandatory exclusion from participation in federal healthcare programs.

This statute has been applied to arrangements between pharmaceutical manufacturers and those in a position to purchase products or refer others, including prescribers, patients, purchasers and formulary managers.

16 unchanged sentences

The European General Data Protection Regulation (“GDPR”) contains new provisions specifically directed at the processing of health information, higher sanctions and extra-territoriality measures intended to bring non-EU companies under the regulation.

We anticipate that over time we may expand our business operations to include additional operations in the EU, including potentially conducting preclinical and clinical trials.

We anticipate that over time we may expand our business operations to include additional

operations in the EU, including potentially conducting pre - clinical and clinical trials.

With such expansion, we would be subject to increased governmental regulation in the EU countries in which we might operate, including regulation due to the GDPR.

If our operations are found to be in violation of any of the laws described above or any other governmental regulations or laws that apply to us, we may be subject to penalties, including, without limitation, civil, criminal and administrative penalties, damages, fines, possible exclusion from Medicare, Medicaid and other government healthcare programs, additional reporting requirements and/or oversight, particularly if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance, disgorgement, imprisonment, contractual damages, reputational harm, diminished profits and future earnings, and curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations.

Our operations may be impacted from changes to current regulations and future legislation.

The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the healthcare system that could prevent or delay approval of our products, restrict or regulate post-approval activities and affect our ability to profitably sell a drug product for which we obtain approval.

Our operations and commercial success may be impacted from changes to current regulations and future legislation.

The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the healthcare system that could prevent or delay approval of our products, restrict or regulate post-approval activities, such as sales and promotional activities and expand post-approval requirements.

Changes in regulations, statutes or the interpretation of existing regulations could impact our business in the future by requiring, for example:

3 unchanged sentences

● additional record-keeping requirements.

If any such changes were to be imposed, they could adversely affect the operation of our business.

While we cannot be sure to what extent the trajectory of these legislative and regulatory proposals will be implemented, whether additional legislative changes will be enacted, whether FDA regulations, guidance or interpretations will be changed, or what the impact of such changes on the marketing approvals of our product candidates, if any, may be, any such changes could adversely affect the operation of our business.

In addition, in the United States, existing regulatory policies may change, and additional government regulations may be enacted that could affect pricing and third-party payment for our product candidates, if approved, which could negatively affect our business, financial condition and prospects.

In the United States, there have been and continue to be a number of legislative initiatives to contain healthcare costs.

For example, in March 2010, the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation Act of 2010, collectively, ACA, was passed, which substantially changed the way healthcare is financed by both governmental and private insurers, and significantly impacted the U.S.

pharmaceutical industry.

The ACA contained provisions that may reduce the profitability of drug products through increased rebates for drugs reimbursed by Medicaid programs, extension of Medicaid rebates to Medicaid managed care plans, mandatory discounts for certain Medicare Part D beneficiaries and annual fees based on pharmaceutical companies’ share of sales to federal health care programs.

In December 2020, the U.S.

Centers for Medicare & Medicaid Services, or CMS, issued a final rule implementing significant manufacturer price reporting changes under the Medicaid Drug Rebate Program, including regulations that affect manufacturer-sponsored patient assistance programs subject to pharmacy benefit manager accumulator programs and Best Price reporting related to certain value-based purchasing arrangements.

The American Rescue Plan Act of 2021 eliminated the statutory cap on Medicaid Drug Rebate Program rebates that manufacturers pay to state Medicaid programs.

Elimination of this cap may require pharmaceutical manufacturers to pay more in rebates than it receives on the sale of products.

In June 2021, the United States Supreme Court held that Texas and other challengers had no legal standing to challenge the ACA, dismissing the case without specifically ruling on the constitutionality of the ACA.

Further, on August 16, 2022, President Biden signed the Inflation Reduction Act, or IRA, into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in ACA marketplaces through plan year 2025.

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

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

It is unclear how additional challenges and healthcare reform measures under the Trump administration will impact the ACA.

Complying with any new legislation and regulatory requirements could be time-intensive and expensive.

The Bipartisan Budget Act of 2018 also amended the ACA, effective January 1, 2019, by increasing the point-of-sale discount that is owed by pharmaceutical manufacturers who participate in Medicare Part D and closing the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole.” CMS published a final rule permitting further collections and payments to and from certain ACA qualified health plans and health insurance issuers under the ACA risk adjustment program in response to the outcome of federal district court litigation regarding the method CMS uses to determine this risk adjustment.

In addition, CMS has published a final rule to give states greater flexibility, starting in 2020, in setting benchmarks for insurers in the individual and small group marketplaces, which may have the effect of relaxing the essential health benefits required under the ACA for plans sold through such marketplaces.

The American Taxpayer Relief Act of 2012, among other things, reduced Medicare payments to several providers, including hospitals, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

Other legislative changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013 and will remain in effect through 2032, with the exception of a temporary suspension implemented under various COVID-19 relief legislation, unless Congress takes further action.

There has been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices.

Specifically, there have been several recent U.S.

Congressional inquiries and proposed federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs.

example, in August 2022, Congress passed the IRA, which includes prescription drug provisions that have significant implications for the pharmaceutical industry and Medicare beneficiaries, including allowing the federal government to negotiate a maximum fair price for certain high-priced single source Medicare drugs, imposing penalties and excise tax for manufacturers that fail to comply with the drug price negotiation requirements, requiring inflation rebates for all Medicare Part B and Part D drugs, with limited exceptions, if their drug prices increase faster than inflation, and redesigning Medicare Part D to reduce out-of-pocket prescription drug costs for beneficiaries, among other changes.

Various industry stakeholders, including pharmaceutical companies and the Pharmaceutical Research and Manufacturers of America, have initiated lawsuits against the federal government asserting that the price negotiation provisions of IRA are unconstitutional.

The impact of these judicial challenges as well as other legislative, executive, and administrative actions and any future healthcare measures is unclear.

The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our product candidates, if approved.

Our revenue prospects could be affected by changes in healthcare spending and policy in the United States and abroad.

We operate in a highly regulated industry and new laws, regulations or judicial decisions, or new interpretations of existing laws, regulations or decisions, related to healthcare availability, the method of delivery or payment for healthcare products and services could negatively impact our business and operations.

There have been, and likely will continue to be, legislative and regulatory proposals at the foreign and federal levels directed at broadening the availability of healthcare and containing or lowering the cost of healthcare.

We cannot predict the initiatives that may be adopted in the future, including repeal, replacement or significant revisions to the ACA.

The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of healthcare or impose price controls may adversely affect our ability to set a price that we believe is fair for our products.

The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability or commercialize our product candidates.

Legislative and regulatory proposals have been made to expand post-approval requirements and restrict sales and promotional activities for biotechnology products.

We cannot be sure to what extent the trajectory of these legislative and regulatory proposals will be implemented, whether additional legislative changes will be enacted, whether FDA regulations, guidance or interpretations will be changed, or what the impact of such changes on the marketing approvals of our product candidates, if any, may be.

In addition, increased scrutiny by Congress of the FDA’s approval process may significantly delay or prevent approval, as well as subject us to more stringent product labeling and post-marketing testing and other requirements.

For example, several healthcare reform initiatives culminated in the enactment of the IRA in 2022, which, among other things, requires HHS to directly negotiate the selling price of a statutorily specified number of drugs and biologics each year that CMS reimburses under Medicare Part B and Part D.

The negotiated price may not exceed a statutory ceiling price.

Only high-expenditure single-source biologics that have been approved for at least 11 years (seven years for single-source drugs) are eligible to be selected by CMS for negotiation, with the negotiated price taking effect two years after the selection year.

For 2026, the first year in which negotiated prices become effective, CMS selected 10 high-cost Medicare Part D products in 2023, negotiations began in 2024, and the negotiated maximum fair price for each product has been announced.

In addition, CMS has selected and announced the negotiated maximum fair price for 15 additional Medicare Part D drugs which will become effective in 2027.

For 2028, CMS has selected an additional 15 drugs, comprised of drugs covered under Medicare Part D and, for the first time, drugs payable under Medicare Part B.

For 2029 and subsequent years, 20 Part B or D drugs will be selected.

The negotiated prices have represented, and will continue to represent, a significant discount from average prices to wholesalers and direct purchasers.

The IRA also imposes rebates on Medicare Part B and Part D drugs whose prices have increased at a rate greater than the rate of inflation, and in 2024, CMS finalized regulations for the Medicare Part B and Part D inflation rebates.

The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

Manufacturers that fail to comply with the IRA may be subject to various penalties, including civil monetary penalties.

These provisions have been, and may continue to be, subject to legal challenges.

Although full economic effect of the IRA on our business and the pharmaceutical industry in general is unknown at this time, it will likely have a significant impact on the pharmaceutical industry and the pricing of our products and product candidates.

Similarly, the adoption of restrictive price controls in new jurisdictions, more restrictive controls in existing jurisdictions or the failure to obtain or maintain timely or adequate pricing could also reduce our profitability.

We expect pricing pressures will continue globally.

The current administration is pursuing policies to reduce regulations and expenditures across government including at HHS, which include the FDA and CMS, and related agencies.

For example, on May 12, 2025, President Trump issued an Executive Order that, among other things, required HHS, within 30 days, to establish and communicate to drug manufacturers MFN price targets designed to bring drug prices for American patients in line with those in comparably developed nations.

If significant progress towards MFN pricing is not achieved, the Executive Order requires HHS to propose a rulemaking to implement MFN pricing.

Recently, on December 23, 2025, CMS issued proposed regulations to establish, under the Center for Medicare and Medicaid Innovation, two mandatory MFN demonstration models under Medicare Parts B and D, respectively.

If these rules or other MFN pricing rules are finalized, they are likely to reduce prices of at least some drugs in the United States, if they are also sold in comparator countries.

Even if we do not market drugs in such countries, we will be indirectly affected if our drugs compete with drugs whose prices were reduced as a result of MFN pricing initiatives.

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

We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates if approved or additional pricing pressures.

We face potential product liability, and, if successful claims are brought against us, we may incur substantial liability and costs.

11 unchanged sentences

● decreased demand for our product candidates, if approved for commercial sale.

We plan to obtain product liability insurance relating to the use of our therapeutics in clinical trials.

We maintain product liability insurance relating to the use of our therapeutics in clinical trials.

However, such insurance coverage may not be sufficient to reimburse us for any expenses or losses we may suffer.

21 unchanged sentences

Any losses or damages we incur could have a material adverse effect on our business operations.

Risks Related to Us Being an Israeli Company

Risks Related to Being an Israeli Company

Shareholders may have difficulties enforcing a U.S.

2 unchanged sentences

securities laws claims in Israel.

Service of process upon us in Israel or upon our non-U.S.

resident directors and officers may be difficult to obtain within the United States and it may be difficult to enforce judgments obtained in the United States against our non-U.S.

directors and executive officers.

Service of process upon us in Israel or upon a non-U.S.

resident director or officers may be difficult to obtain within the United States and it may be difficult to enforce judgments obtained in the United States against a non-U.S.

director or executive officer.

In addition, we have been informed by our legal counsel in Israel that it may be difficult to assert claims under U.S.

3 unchanged sentences

securities laws against us or our officers and directors because Israel may not be the most appropriate forum to bring such a claim.

In addition, even if an Israeli court agrees to hear a claim, it may determine

that Israeli law and not U.S.

In addition, even if an Israeli court agrees to hear a claim, it may determine that Israeli law and not U.S.

law is applicable to the claim.

3 unchanged sentences

There is little binding case law in Israel addressing the matters described above.

Israeli courts might not enforce judgments rendered outside Israel, which may make it difficult to collect on judgments rendered against us or our officers and directors in Israel.

Israeli courts might not enforce judgments rendered outside Israel, which may make it difficult to collect on judgments rendered against us or any officers and directors in Israel.

Moreover, an Israeli court will not enforce a foreign judgment if it was given in a state whose laws do not provide for the enforcement of judgments of Israeli courts (subject to exceptional cases) or if its enforcement is likely to prejudice the sovereignty or security of the State of Israel or due to, among other reasons, absence of due process, or the existence of a judgment which is at variance with another judgment that was given in the same matter if a suit in the same matter between the same parties was pending before a court or tribunal in Israel.

25 unchanged sentences

Further, an inactive market may also impair our ability to raise capital by issuing securities and may impair our ability to enter into strategic partnerships or acquire companies or products by using our equity as consideration.

The requirements of being a publicly traded company may strain our resources and divert management’s attention.

As a publicly traded company, we have incurred, and will continue to incur, significant legal, accounting and other expenses that we did not incur as a private company.

In addition, the Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), as well as rules subsequently implemented by the SEC and Nasdaq under such acts have imposed various requirements on public companies.

Shareholder activism, the current political environment and the current high level of government regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead to additional compliance costs and impact the manner in which we operate our business in ways we cannot currently anticipate.

Our management will need to devote a substantial amount of time to these compliance initiatives.

Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly.

For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to incur substantial costs to maintain our current levels of such coverage.

We incur costs and demands upon management as a result of complying with the laws and regulations affecting public companies, which may harm our business.

As a publicly traded company, we incur significant legal, accounting, and other expenses.

In addition, changing laws, regulations, and standards relating to corporate governance and public disclosure, including regulations implemented by the SEC and The Nasdaq Stock Market, may increase legal and financial compliance costs and make some activities more time-consuming.

These laws, regulations, and standards are subject to varying interpretations, and as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies.

We intend to invest resources to comply with evolving laws, regulations, and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities.

If, notwithstanding our efforts, we fail to comply with new laws, regulations, and standards, regulatory authorities may initiate legal proceedings against us and our business may be harmed.

Failure to comply with these rules might also make it more difficult for us to obtain certain types of insurance, including director and officer liability insurance, and we might be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage.

Failure to achieve and maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our business, results of operation or financial condition.

6 unchanged sentences

Our failure to meet the continued listing requirements of The Nasdaq Capital Market could result in a delisting of our ADSs.

Our ADSs are currently listed on the Nasdaq Capital Market.

In order to maintain this listing, we must satisfy minimum financial and other continued listing requirements and standards, including a maintaining minimum closing bid price requirement for our ADSs of $1.00 per ADS as required by Nasdaq Listing Rule 5550(a)(2) (“Minimum Bid Price Requirement”).

There can be no assurance that we will be able to comply with the applicable listing standards.

On April 29, 2024, we received a deficiency letter from the Listing Qualifications Department of Nasdaq notifying us that for the preceding 31 consecutive business days (March 14, 2024 through April 26, 2024), our ADSs did not maintain a minimum closing bid price of $1.00 per ADS as required by the Minimum Bid Price Requirement.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we had a compliance period of 180 calendar days, or until October 28, 2024, to regain compliance with Nasdaq Listing Rule 5550(a)(2).

On October 16, 2024, the Company submitted a letter to Nasdaq requesting an additional 180-day grace period to regain compliance with the Minimum Bid Price Requirement.

On October 29, 2024, the Company received a letter from the Listing Qualifications Department of Nasdaq granting the Company an additional 180 calendar day grace period, or until April 28, 2025, to regain compliance.

The Staff’s determination in granting the Company the extension was based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Nasdaq Capital Market with the exception of the Minimum Bid Price Requirement, and the Company’s written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse split, if necessary.

Compliance may be achieved without further action if the closing bid price of the Company’s ADS is at or above $1.00 for a minimum of ten consecutive business days at any time during the second

compliance period, in which case Nasdaq will notify the Company if it determines the Company is in compliance and the matter will be closed;

however Nasdaq could require the closing bid price to equal or to exceed the $1.00 minimum bid price requirement for more than 10 consecutive business days before determining that the Company complies.

If compliance cannot be demonstrated by April 28, 2025, the Staff will provide written notification that the Company’s securities will be delisted.

At that time, the Company may appeal the Staff’s determination to a Hearings Panel.

If we cannot regain compliance with the Minimum Bid Price Requirement or if we otherwise fail to meet any of Nasdaq’s listing standards, our ADSs will be subject to delisting.

Our ADSs are listed on the Nasdaq Capital Market, which imposes, among other requirements, a minimum bid requirement.

On April 29, 2024, we received a letter from the Listing Qualifications staff of The Nasdaq Stock Market, LLC (“Nasdaq”) notifying us that the closing bid price per ADS was below the required minimum of $1.00 for a period of 30 consecutive business days and that we did not meet the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”).

Pursuant to Nasdaq Rule 5810(c)(3)(A), we had an initial period of one hundred eighty (180) calendar days, or until October 29, 2024, which was subsequently extended a further one hundred eighty (180) calendar days, or until April 28, 2025, to regain compliance with Nasdaq’s Minimum Bid Price Requirement.

To regain compliance with the Nasdaq Listing Rules, on April 9, 2025, we effected a change in the ratio of ADSs evidencing Ordinary Shares from one (1) ADS representing one (1) Ordinary Share to one (1) ADS representing thirty-five (35) Ordinary Shares.

On April 29, 2025, we received a letter from Nasdaq stating that our closing bid price per ADS was at $1.00 or greater for the last 13 consecutive business days.

Accordingly, we regained compliance with Listing Rule 5550(a)(2) and the matter was closed.

Nasdaq Listing Rule 5810(c)(3)(A)(iv) states that any listed company that fails to meet the Minimum Bid Price Requirement and has effected a reverse stock split over the prior one-year period, or has effected one or more reverse stock splits over the prior two-year period with a cumulative ratio of 250 shares or more to one, will not be eligible for an automatic 180-day grace compliance period and the Nasdaq Listing Qualifications Department is obligated to immediately issue a delisting determination.

Therefore, if we were to fall out of compliance with the Minimum Bid Price Requirement prior to April 9, 2026, we would not be able to effect a reverse stock split and would immediately be issued a delisting determination.

Further, the Nasdaq rule provides that a company will not be considered to have regained compliance with the Minimum Bid Price Requirement if the company takes an action to achieve compliance (such as a reverse split) and that action results in the Company’s security falling below the numeric threshold for another listing requirement.

There can be no assurance that we will be able to maintain compliance with Nasdaq’s Minimum Bid Price Requirement for continued listing or other continued listing requirements.

If we fail to meet any of Nasdaq’s listing standards, our ADSs will be subject to delisting.

If that were to occur, our ADSs would be subject to rules that impose additional sales practice requirements on broker-dealers who sell our securities.

4 unchanged sentences

These factors could contribute to lower prices and larger spreads in the bid and ask prices of these securities.

There can be no assurance that our ADSs, if delisted from the Nasdaq, would be listed on a national securities exchange, a national quotation service or the over-the-counter markets.

Delisting from the Nasdaq could also result in negative publicity, adversely affect the market liquidity of our ADSs, decrease securities analysts’ coverage of us or diminish investor, supplier and employee confidence.

There can be no assurance that our ADSs, if delisted from Nasdaq, would be listed on a national securities exchange, a national quotation service or the over-the-counter markets.

Delisting from Nasdaq could also result in negative publicity, adversely affect the market liquidity of our ADSs, decrease securities analysts’ coverage of us and/or diminish investor, supplier and employee confidence.

In addition, our stock could become a “penny stock,” which would make trading of our ADSs more difficult.

The delisting of our ADSs from Nasdaq may make it more difficult for us to raise capital on favorable terms in the future, or at all.

1 unchanged sentence

Further, if our ADSs were to be delisted from Nasdaq, our ADSs would cease to be recognized as a covered security, and we would be subject to additional regulation in each state in which we offer our securities.

Moreover, there is no assurance that any actions that we take to restore our compliance with the Nasdaq Minimum Bid Price Requirement would stabilize the market price or improve the liquidity of our ADSs, prevent our ADSs from falling below the Nasdaq minimum bid price required for continued listing again or prevent future non-compliance with other applicable Nasdaq listing requirements, including maintaining minimum levels of stockholders’ equity or market values of our ADSs, our ADSs could be delisted.

Moreover, there is no assurance that the actions that we have taken to restore our compliance with the Nasdaq Minimum Bid Price Requirement will stabilize the market price or improve the liquidity of our ADSs, prevent our ADSs from falling below the Nasdaq minimum bid price required for continued listing again or prevent future non-compliance with other applicable Nasdaq listing requirements.

The market price for our ADSs may be volatile.

1 unchanged sentence

● our failure to obtain the approvals necessary to commence clinical trials;

● results of clinical and preclinical studies;

● results of clinical and pre - clinical studies;

● announcements of regulatory approval or the failure to obtain it, or changes or delays in the regulatory review process;

25 unchanged sentences

If we face such litigation, it could result in substantial costs, divert management’s attention and resources, and have a material adverse effect on our business, operating results and prospects.

Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs decline.

Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs to decline.

Substantial sales of our ADSs on Nasdaq may cause the market price of our ADSs to decline.

10 unchanged sentences

Moreover, the Israeli Companies Law, 5759-1999 (the “Companies Law”) imposes certain restrictions on our ability to declare and pay dividends.

As a result, investors in our ADSs or ordinary shares will not be able to benefit from owning these securities unless their market price becomes greater than the price paid by such investors and they are able to sell such securities.

As a result, investors in our ADSs or ordinary shares will not be able to benefit from owning

these securities unless their market price becomes greater than the price paid by such investors and they are able to sell such securities.

We cannot assure you that shareholders will ever be able to resell our securities at a price in excess of the price paid.

24 unchanged sentences

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