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Item 1A. Risk Factors

2024-03-28 compared with 2023-03-31 · 1067 added, 816 removed, 795 unchanged (70% of the section changed)

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deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

If any of the following

events occur, our business, financial condition and results of operations could be materially adversely affected.

In such case, the value

and trading price of our common stock could decline, and you may lose all or part of your investment.

If any of the

following events occur, our business, financial condition and results of operations could be materially adversely affected.

In such case,

the value and trading price of our common stock could decline, and you may lose all or part of your investment.

Risks Related to Our Financial Position and

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Our net losses for the years ended December 31, 2023 and 2022 were $7.8

and $14,313,705, respectively, and our accumulated deficit as of December 31, 2022 and 2021 was $45,099,116 and $33,727,163, respectively.

million and $11.4 million, respectively, and our accumulated deficit as of December 31, 2023 and 2022 was $52.9 million and $45.1 million,

respectively.

There can be no assurance that the products under development by us will be approved for sale in the U.S.

or elsewhere.

Furthermore, there

can be no assurance that if such products are approved they will be successfully commercialized, and the extent of our future losses and

the timing of our profitability are highly uncertain.

If we are unable to achieve profitability, we may be unable to continue our operations.

Furthermore, there can be no assurance that if such products are approved they will be successfully commercialized, and the extent of

our future losses and the timing of our profitability are highly uncertain.

If we are unable to achieve profitability, we may be unable

to continue our operations.

If we fail to obtain the capital necessary

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However, we may not be able to secure funding on favorable terms, if at all.

If we cannot raise adequate funds to satisfy our

capital requirements, we may have to delay, scale back or eliminate our research and development activities, clinical studies or operations.

We may also be required to obtain funds through arrangements with collaborators, which arrangements may require us to relinquish rights

to certain intellectual property, technologies or products that we otherwise would not consider relinquishing, including rights to future

product candidates or certain major geographic markets.

This could result in sharing revenues which we might otherwise retain for ourselves.

If we cannot raise adequate funds to satisfy

our capital requirements, we may have to delay, scale back or eliminate our research and development activities, clinical studies or

We may also be required to obtain funds through arrangements with collaborators, which arrangements may require us to relinquish

rights to certain intellectual property, technologies or products that we otherwise would not consider relinquishing, including rights

to future product candidates or certain major geographic markets.

This could result in sharing revenues which we might otherwise retain

for ourselves.

Any of these actions may harm our business, financial condition and results of operations.

The amount of capital we may need depends on many

factors, including the progress, timing and scope of our product development programs;

The amount of capital we may need depends on

many factors, including the progress, timing and scope of our product development programs;

the progress, timing and scope of our pre-clinical

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Although we have entered into the Voltron

Agreement pursuant to which we and HaloVax intend to jointly develop products to prevent COVID-19, no assurance can be given as to when,

if ever, we will be able to develop any products for such purpose and if developed that such products will be successfully commercialized.

Agreement pursuant to which we and HaloVax, LLC (“HaloVax”) intend to jointly develop products to prevent COVID-19, no assurance

can be given as to when, if ever, we will be able to develop any products for such purpose and if developed that such products will be

successfully commercialized.

In March 2020, we entered into the Voltron Agreement

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but not limited to, the following with respect to the development of a treatment for COVID-19:

● the EUA marketing approval processes of the FDA are lengthy, time

consuming and inherently unpredictable, and we cannot guarantee that we will ever have a marketable product

the EUA marketing approval

processes of the FDA are lengthy, time consuming and inherently unpredictable, and we cannot guarantee that we will ever have a marketable

we may encounter substantial

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physicians must be persuaded that using our products are effective alternatives to other existing therapies and treatments;

● we may depend on third parties

for manufacturing our proposed product candidates and any conflicts with such partners could delay or prevent the development or commercialization

of such product candidates;

● if third-party contract manufacturers

upon whom we rely to formulate and manufacture our product candidates do not perform, fail to manufacture according to our specifications

or fail to comply with strict regulations, our clinical studies could be adversely affected and the development of our product candidates

could be delayed or terminated or we could incur significant additional expenses;

● adverse events involving our

products may lead the FDA to delay or deny clearance for our products or result in product recalls that could harm our reputation, business

and financial results;

● if we fail to comply with healthcare

regulations, we could face substantial enforcement actions, including civil and criminal penalties and our business, operations and financial

condition could be adversely affected.

In addition to the foregoing, on January 31, 2023,

President Biden issued a Statement of Administration Policy indicating that the administration intends for the COVID-19 national emergency

and public health emergency to end on May 11, 2023.

EUAs are issued under a separate declaration based on a determination of whether certain

conditions are met.

Therefore, when the public health emergency ends, current EUAs may remain authorized and the FDA will continue to

have the authority to issue new EUAs as long as those conditions are met and until that authority is formally terminated by the Secretary

of HHS through a separate process.

The Company anticipates that the end of the public health emergency may reduce the likelihood of an

EUA pathway for its potential products candidates to prevent COVID-19 even if the EUA declaration remains in place and that the EUA pathway

may become unavailable within a short period after a notice of the termination of the EUA declaration is published in the Federal Register.

If our joint venture with HaloVax, LLC (“HaloVax”)

is not successful or if we fail to realize the benefits we anticipate from such joint venture, we may not be able to capitalize on the

full market potential of our potential products.

In March 2020, we entered into the Voltron Agreement to form a joint

venture entity named HaloVax to jointly develop potential product candidates for the prevention of the COVID-19.

Pursuant to the terms

of the Voltron Agreement we are entitled to receive sales-based royalties at low single digit percentages and shall contribute proceeds

of the development of products to prevent COVID-19.

In addition, in 2020, we purchased 6% of HaloVax’s outstanding membership interests;

however, during the fourth quarter of 2022, we identified indicators of impairment for the HaloVax investment as a result of adverse changes

in HaloVax’s business operations, including liquidity concerns.

As a result, we investment in HaloVax was valued at $0 and $350,000

as of December 31, 2022 and 2021.

If and to the extent we and HaloVax are unable to develop potential product candidates for the prevention

of COVID-19, we will not be entitled to any sale-based royalties and the value of our ownership interest in HaloVax could decline in which

case we may lose all or part of our investment in HaloVax.

we may depend on third

parties for manufacturing our proposed product candidates and any conflicts with such partners could delay or prevent the development

or commercialization of such product candidates;

if third-party contract

manufacturers upon whom we rely to formulate and manufacture our product candidates do not perform, fail to manufacture according

to our specifications or fail to comply with strict regulations, our clinical studies could be adversely affected and the development

of our product candidates could be delayed or terminated or we could incur significant additional expenses;

adverse events involving

our products may lead the FDA to delay or deny clearance for our products or result in product recalls that could harm our reputation,

business and financial results;

if we fail to comply with

healthcare regulations, we could face substantial enforcement actions, including civil and criminal penalties and our business, operations

and financial condition could be adversely affected.

Although the federal government had previously

declared COVID-19 a national emergency, that declaration expired on May 11, 2023, at which time the favorable payment provisions available

to healthcare providers during the declared national emergency ended.

The FDA issued EUAs for several COVID-19 related products in 2020

EUAs are authorized pursuant to an EUA declaration under the U.S.

Food, Drug, and Cosmetic Act and remain in effect until the

Secretary of the U.S.

Department of Health and Human Services terminates the EUA declaration or unless sooner terminated or revoked.

If our joint venture with HaloVax is not

successful or if we fail to realize the benefits we anticipate from such joint venture, we may not be able to capitalize on the full

market potential of our potential products.

In March 2020, we entered into the Voltron Agreement

to form a joint venture entity named HaloVax to jointly develop potential product candidates for the prevention of the COVID-19.

to the terms of the Voltron Agreement we are entitled to receive sales-based royalties at low single digit percentages and shall contribute

proceeds of the development of products to prevent COVID-19.

In addition, in 2020, we purchased 6% of HaloVax’s outstanding membership

however, during the fourth quarter of 2022, we identified indicators of impairment for the HaloVax investment as a result

of adverse changes in HaloVax’s business operations, including liquidity concerns.

As a result, our investment in HaloVax was valued

at $0 as of December 31, 2023 and 2022.

If and to the extent we and HaloVax are unable to develop potential product candidates for the

prevention of COVID-19, we will not be entitled to any sale-based royalties.

While Voltron has agreed to cooperate and use

commercially reasonable efforts to exchange information and resources that will lead to the development activities and established a Joint

Development Committee consisting of seven members, two of which were selected by us, to plan, review, coordinate and oversee the performance

of the development activities and timelines with respect to development activities, we have limited contractual rights to direct its activities.

commercially reasonable efforts to exchange information and resources that will lead to the development activities and established a

Joint Development Committee consisting of seven members, two of which were selected by us, to plan, review, coordinate and oversee the

performance of the development activities and timelines with respect to development activities, we have limited contractual rights to

direct its activities.

Moreover, we will not have any other control with respect to the operations of HaloVax.

Therefore, HaloVax will have a greater influence

with respect to its commercialization efforts and other operations.

In general, our joint venture with HaloVax subjects us to a number

of related risks including that:

Therefore, HaloVax will

have a greater influence with respect to its commercialization efforts and other operations.

In general, our joint venture with HaloVax

subjects us to a number of related risks including that:

we may not receive sales-based

royalties pursuant to the terms of the Voltron Agreement;

● we may not be successful in

the development of any product candidates;

● HaloVax may not commit sufficient

resources to the marketing and distribution of our products;

● HaloVax may infringe the intellectual

property rights of third parties, which may expose us to litigation and other potential liability;

we may not be successful

in the development of any product candidates;

HaloVax may not commit

sufficient resources to the marketing and distribution of our products;

HaloVax may infringe the

intellectual property rights of third parties, which may expose us to litigation and other potential liability;

disputes may arise between

us and HaloVax that result in the delay or termination of the commercialization of our products or product candidates or that result

in costly litigation or arbitration that diverts management attention and resources including, but not limited to, disputes with respect

to commercializing products upon terms mutually agreeable or beneficial to us and HaloVax;

in costly litigation or arbitration that diverts management attention and resources including, but not limited to, disputes with

respect to commercializing products upon terms mutually agreeable or beneficial to us and HaloVax;

any products, if developed,

will be sold or licensed on terms that are beneficial to us;

● HaloVax may not provide us

with timely and accurate information regarding commercialization status or results, which could adversely impact our ability to manage

our own commercialization efforts, accurately forecast financial results or provide timely information to our shareholders regarding

our commercialization efforts;

● if any product candidates are

successfully developed that we will be able to commercialize such products upon terms mutually agreeable or beneficial to us and HaloVax.

HaloVax may not provide

us with timely and accurate information regarding commercialization status or results, which could adversely impact our ability to

manage our own commercialization efforts, accurately forecast financial results or provide timely information to our shareholders

regarding our commercialization efforts;

if any product candidates

are successfully developed that we will be able to commercialize such products upon terms mutually agreeable or beneficial to us

If HT-005 is not commercialized by Zylö

or otherwise acquired by a third-party, we may not be able to capitalize on the full market potential of our interests with respect to

In December 2021, we licensed HT-005 back to Zylö

and are entitled to receive a low single digit percent of the net proceeds attributable to the sale of HT-005 to a third party, a low

single digit percent of the net proceeds from the sale of HT-005 in the United States and Canada and their respective territories (collectively,

the “Territory”) and a low double digit percent of any royalty Zylö receives through the sublicense to a third party

based on the net sales of HT-005 in the Territory.

In connection with the license of HT-005 back to Zylö, we acquired 100,000 shares

of Zylö’s Class B common stock.

As of December 31, 2022, we own 220,000 shares of Zylö’s Class B common stock.

Zylö is unable to sell or otherwise commercialize HT-005, we will not be entitled to any proceeds or sale-based royalties and the

value of our ownership interest in Zylö could decline in which case we may lose all or part of our investment in Zylö.

In December 2021, we licensed HT-005 back to

Zylö and are entitled to receive a low single digit percent of the net proceeds attributable to the sale of HT-005 to a third-party,

a low single digit percent of the net proceeds from the sale of HT-005 in the United States and Canada and their respective territories

(collectively, the “Territory”) and a low double digit percent of any royalty Zylö receives through the sublicense to

a third-party based on the net sales of HT-005 in the Territory.

In connection with the license of HT-005 back to Zylö, we acquired

100,000 shares of Zylö’s Class B common stock.

As of December 31, 2023, we own 220,000 shares of Zylö’s Class B

common stock.

If Zylö is unable to sell or otherwise commercialize HT-005, we will not be entitled to any proceeds or sale-based

royalties and the value of our ownership interest in Zylö could decline in which case we may lose all or part of our investment

The marketing approval process of the FDA

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agencies may disagree with the design or implementation of our clinical trials;

● the FDA could determine that

we cannot rely on Section 505(b)(2) for any of our product candidates;

the FDA could determine

that we cannot rely on Section 505(b)(2) for any of our product candidates;

the FDA may determine that

we have identified the wrong reference listed drug or drugs or that approval of our Section 505(b)(2) application for any of our product

candidates is blocked by patent or non-patent exclusivity of the reference listed drug or drugs.

we have identified the wrong reference listed drug or drugs or that approval of our Section 505(b)(2) application for any of our

product candidates is blocked by patent or non-patent exclusivity of the reference listed drug or drugs.

In addition, the process of seeking regulatory

clearance or approval to market the product candidates we intend to develop is expensive and time consuming and, notwithstanding the effort

and expense incurred, clearance or approval is never guaranteed.

If we are not successful in obtaining timely clearance or approval of

our product candidates from the FDA or other foreign regulatory agencies, we may never be able to generate significant revenue and may

be forced to cease operations.

clearance or approval to market the product candidates we intend to develop is expensive and time consuming and, notwithstanding the

effort and expense incurred, clearance or approval is never guaranteed.

If we are not successful in obtaining timely clearance or approval

of our product candidates from the FDA or other foreign regulatory agencies, we may never be able to generate significant revenue and

may be forced to cease operations.

The NDA process is costly, lengthy and uncertain.

Any NDA application filed by us will have to be supported

by extensive data, including, but not limited to, technical, pre-clinical, clinical, manufacturing and labeling data, to demonstrate to

the FDA’s satisfaction the safety and efficacy of the product for its intended use.

Any NDA application filed by us will have to be

supported by extensive data, including, but not limited to, technical, pre-clinical, clinical, manufacturing and labeling data, to demonstrate

to the FDA’s satisfaction the safety and efficacy of the product for its intended use.

Obtaining clearances or approvals from the FDA

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other time-consuming actions, or it could simply deny our applications.

In addition, even if we obtain an NDA approval or pre-market approvals

in other countries, the approval could be revoked or other restrictions imposed if post-market data demonstrates safety issues or lack

of effectiveness.

In addition, even if we obtain an NDA approval or pre-market

approvals in other countries, the approval could be revoked or other restrictions imposed if post-market data demonstrates safety issues

or lack of effectiveness.

We cannot predict with certainty how, or when, the FDA or other regulatory agencies will act.

If we are unable to obtain

the necessary regulatory approvals, our financial condition and cash flow may be adversely affected, and our ability to grow domestically

and internationally may be limited.

Additionally, even if cleared or approved, our products may not be approved for the specific indications

that are most necessary or desirable for successful commercialization or profitability.

We may encounter substantial delays in completing

our clinical studies which in turn will require additional costs, or we may fail to demonstrate adequate safety and efficacy to the satisfaction

of applicable regulatory authorities.

If we are unable

to obtain the necessary regulatory approvals, our financial condition and cash flow may be adversely affected, and our ability to grow

domestically and internationally may be limited.

Additionally, even if cleared or approved, our products may not be approved for the

specific indications that are most necessary or desirable for successful commercialization or profitability.

We may encounter substantial delays in

completing our clinical studies which in turn will require additional costs, or we may fail to demonstrate adequate safety and efficacy

to the satisfaction of applicable regulatory authorities.

It is impossible to predict if or when any of

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Events that may prevent successful or timely completion of clinical development include:

● delays in reaching, or failing

to reach, a consensus with regulatory agencies on study design;

● delays in reaching, or failing

to reach, agreement on acceptable terms with a sufficient number of prospective contract research organizations (“CROs”)

delays in reaching, or

failing to reach, a consensus with regulatory agencies on study design;

delays in reaching, or

failing to reach, agreement on acceptable terms with a sufficient number of prospective contract research organizations (“CROs”)

and clinical study sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs

and trial sites;

delays in obtaining required IRB or Ethics Committee (“EC”) approval at each clinical study site;

delays in recruiting a sufficient number of suitable patients to participate in our clinical studies;

imposition of a clinical hold by regulatory agencies, after an inspection of our clinical study operations or study sites;

failure by our CROs, other third parties or us to adhere to clinical study, regulatory or legal requirements;

in obtaining required IRB or Ethics Committee (“EC”) approval at each clinical study site;

in recruiting a sufficient number of suitable patients to participate in our clinical studies;

of a clinical hold by regulatory agencies, after an inspection of our clinical study operations or study sites;

by our CROs, other third parties or us to adhere to clinical study, regulatory or legal requirements;

failure to perform in accordance

with the FDA’s GCP or applicable regulatory guidelines in other countries;

delays in the testing, validation, manufacturing and delivery of sufficient quantities of our product candidates to the clinical sites;

delays in having patients complete participation in a study or return for post-treatment follow-up;

clinical study sites or patients dropping out of a study;

delay or failure to address any patient safety concerns that arise during the course of a trial;

unanticipated costs or increases in costs of clinical trials of our product candidates;

occurrence of serious adverse events associated with the product candidate that are viewed to outweigh its potential benefits;

changes in regulatory requirements and guidance that require amending or submitting new clinical protocols.

We could also encounter delays if a clinical trial

is suspended or terminated by us, by the IRBs or ECs of the institutions in which such trials are being conducted, by an independent Safety

Review Board for such trial or by the FDA, Therapeutics Goods Administration (“TGA”), European Medicines Agency (“EMA”),

in the testing, validation, manufacturing and delivery of sufficient quantities of our product candidates to the clinical sites;

in having patients complete participation in a study or return for post-treatment follow-up;

study sites or patients dropping out of a study;

or failure to address any patient safety concerns that arise during the course of a trial;

unanticipated

costs or increases in costs of clinical trials of our product candidates;

of serious adverse events associated with the product candidate that are viewed to outweigh its potential benefits;

in regulatory requirements and guidance that require amending or submitting new clinical protocols.

We could also encounter delays if a clinical

trial is suspended or terminated by us, by the IRBs or ECs of the institutions in which such trials are being conducted, by an independent

Safety Review Board for such trial or by the FDA, Therapeutics Goods Administration (“TGA”), European Medicines Agency (“EMA”),

or other regulatory authorities.

Such authorities may suspend or terminate a clinical trial due to a number of factors, including failure

to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations

or trial site by the FDA, TGA, or other regulatory authorities resulting in the imposition of a clinical hold, unforeseen safety issues

or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations or administrative actions

or lack of adequate funding to continue the clinical trial.

to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial

operations or trial site by the FDA, TGA, or other regulatory authorities resulting in the imposition of a clinical hold, unforeseen

safety issues or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations or administrative

actions or lack of adequate funding to continue the clinical trial.

Any inability to successfully complete pre-clinical

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we may need to conduct additional studies to bridge our modified product candidates to earlier versions.

Clinical study delays could also 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 could impair our ability to successfully commercialize our product candidates.

In addition, any delays in completing

our clinical trials will increase our costs, slow down our product candidate development and approval process and jeopardize our ability

to commence product sales and generate revenues.

Any of these occurrences may significantly harm our business, financial condition and

In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also

ultimately lead to the denial of regulatory approval of our product candidates.

Clinical study delays could also 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 could impair our ability to successfully commercialize our product candidates.

In addition, any delays

in completing our clinical trials will increase our costs, slow down our product candidate development and approval process and jeopardize

our ability to commence product sales and generate revenues.

Any of these occurrences may significantly harm our business, financial

condition and prospects.

In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical

trials may also ultimately lead to the denial of regulatory approval of our product candidates.

The outcome of pre-clinical studies and early

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events associated with our other product candidates, we may:

● be delayed in obtaining marketing

approval for our product candidates, if approved at all;

obtain approval for indications or patient populations that are not as broad as intended or desired;

obtain approval with labeling that includes significant use or distribution restrictions or safety warnings;

be required to change the way the product is administered;

be required to perform additional clinical studies to support approval or be subject to additional post-marketing testing requirements;

have regulatory authorities withdraw their approval of a product or impose restrictions on its distribution in the form of a modified risk evaluation and mitigation strategy;

experience damage to our reputation.

be delayed in obtaining

marketing approval for our product candidates, if approved at all;

obtain approval for indications

or patient populations that are not as broad as intended or desired;

obtain approval with labeling

that includes significant use or distribution restrictions or safety warnings;

be required to change the

way the product is administered;

be required to perform

additional clinical studies to support approval or be subject to additional post-marketing testing requirements;

have regulatory authorities

withdraw their approval of a product or impose restrictions on its distribution in the form of a modified risk evaluation and mitigation

experience damage to our

Additionally, our product candidates could potentially

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commercialize our product candidates.

The research, testing, manufacturing, labeling, packaging, storage, approval, sale, marketing, advertising

and promotion, pricing, export, import and distribution of drug products are subject to extensive regulation by the FDA, EMA, and other

regulatory authorities in the United States, European Union, and other countries, where regulations differ from country to country.

are not permitted to market our product candidates as prescription pharmaceutical products in the United States until we receive approval

of an NDA from the FDA, or in any foreign countries until we receive the requisite approval from such countries.

In the United States,

the FDA generally requires the completion of clinical trials of each drug to establish its safety and efficacy and extensive pharmaceutical

development to ensure its quality before an NDA is approved.

Regulatory authorities in other jurisdictions impose similar requirements.

Of the large number of drugs in development, only a small percentage result in the submission of an NDA to the FDA or other regulatory

authorities and even fewer are eventually approved for commercialization.

We have not submitted an NDA to the FDA or comparable applications

to other regulatory authorities.

If our development efforts for our product candidates, including regulatory approval, are not successful

for their planned indications, or if adequate demand for our product candidates is not generated, our business will be materially adversely

Our success depends on the receipt of regulatory

approval and the issuance of such regulatory approvals is uncertain and subject to a number of risks, including the following:

the results of nonclinical or toxicology studies may not support the filing of an IND or foreign equivalent for our product candidates;

the FDA, EMA, or comparable foreign regulatory authorities or IRBs or ECs may disagree with the design or implementation of our clinical trials;

we may not be able to provide acceptable evidence of our product candidates’ safety and efficacy;

the results of our clinical trials may not be satisfactory or may not meet the level of statistical or clinical significance required by the FDA, EMA, or other regulatory agencies for marketing approval;

the dosing of our product candidates in a particular clinical trial may not be at an optimal level;

patients in our clinical trials may suffer adverse effects for reasons that may or may not be related to our product candidates;

the data collected from clinical trials may not be sufficient to support the submission of an NDA, BLA or other marketing application or to obtain regulatory approval in the United States or elsewhere;

the requirement for additional studies;

the FDA, EMA, or comparable foreign regulatory authorities may fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies;

the approval policies or regulations of the FDA, EMA, or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval;

the FDA, EMA, or comparable foreign regulatory authorities may disagree on the design or implementation of our clinical trials, including the methodology used in our studies, our chosen endpoints, our statistical analysis, or our proposed product indication;

our failure to demonstrate to the satisfaction of the FDA, EMA, or comparable regulatory authorities that a product candidate is safe and effective for its proposed indication;

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

immunogenicity might affect a product candidate’s efficacy and/or safety;

the FDA, EMA, or comparable foreign regulatory authorities may disagree with our interpretation of data from nonclinical studies or clinical trials;

data collected from clinical trials of our product candidates may be insufficient to support the submission and filing of a marketing application or to obtain marketing approval.

The research, testing, manufacturing, labeling, packaging, storage, approval, sale, marketing,

advertising and promotion, pricing, export, import and distribution of drug products are subject to extensive regulation by the FDA,

EMA, and other regulatory authorities in the United States, European Union, and other countries, where regulations differ from country

We are not permitted to market our product candidates as prescription pharmaceutical products in the United States until

we receive approval of an NDA from the FDA, or in any foreign countries until we receive the requisite approval from such countries.

In the United States, the FDA generally requires the completion of clinical trials of each drug to establish its safety and efficacy

and extensive pharmaceutical development to ensure its quality before an NDA is approved.

Regulatory authorities in other jurisdictions

impose similar requirements.

Of the large number of drugs in development, only a small percentage result in the submission of an NDA

to the FDA or other regulatory authorities and even fewer are eventually approved for commercialization.

We have not submitted an NDA

to the FDA or comparable applications to other regulatory authorities.

If our development efforts for our product candidates, including

regulatory approval, are not successful for their planned indications, or if adequate demand for our product candidates is not generated,

our business will be materially adversely affected.

Our success depends on the

receipt of regulatory approval and the issuance of such regulatory approvals is uncertain and subject to a number of risks, including

the following:

the results of nonclinical

or toxicology studies may not support the filing of an IND or foreign equivalent for our product candidates;

the FDA, EMA, or comparable

foreign regulatory authorities or IRBs or ECs may disagree with the design or implementation of our clinical trials;

we may not be able to provide

acceptable evidence of our product candidates’ safety and efficacy;

the results of our clinical

trials may not be satisfactory or may not meet the level of statistical or clinical significance required by the FDA, EMA, or other

regulatory agencies for marketing approval;

the dosing of our product

candidates in a particular clinical trial may not be at an optimal level;

patients in our clinical

trials may suffer adverse effects for reasons that may or may not be related to our product candidates;

the data collected from

clinical trials may not be sufficient to support the submission of an NDA, BLA or other marketing application or to obtain regulatory

approval in the United States or elsewhere;

the requirement for additional

the FDA, EMA, or comparable

foreign regulatory authorities may fail to approve the manufacturing processes or facilities of third-party manufacturers with which

we contract for clinical and commercial supplies;

the approval policies or

regulations of the FDA, EMA, or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical

data insufficient for approval;

the FDA, EMA, or comparable

foreign regulatory authorities may disagree on the design or implementation of our clinical trials, including the methodology used

in our studies, our chosen endpoints, our statistical analysis, or our proposed product indication;

our failure to demonstrate

to the satisfaction of the FDA, EMA, or comparable regulatory authorities that a product candidate is safe and effective for its

proposed indication;

we may fail to demonstrate

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

immunogenicity might affect

a product candidate’s efficacy and/or safety;

the FDA, EMA, or comparable

foreign regulatory authorities may disagree with our interpretation of data from nonclinical studies or clinical trials;

data collected from clinical

trials of our product candidates may be insufficient to support the submission and filing of a marketing application or to obtain

marketing approval.

For example, the FDA may require additional studies to show that our product candidates are safe or effective;

we may fail to obtain approval of the manufacturing processes or facilities of third-party manufacturers with whom we contract for clinical and commercial supplies;

there may be changes in the approval policies or regulations that render our nonclinical and clinical data insufficient for approval;

the FDA, EMA or comparable foreign regulatory authority may require more information, including additional nonclinical or clinical data to support approval, which may delay or prevent approval and our commercialization plans, or we may decide to abandon the development program.

we may fail to obtain approval

of the manufacturing processes or facilities of third-party manufacturers with whom we contract for clinical and commercial supplies;

there may be changes in

the approval policies or regulations that render our nonclinical and clinical data insufficient for approval;

the FDA, EMA or comparable

foreign regulatory authority may require more information, including additional nonclinical or clinical data to support approval,

which may delay or prevent approval and our commercialization plans, or we may decide to abandon the development program.

Failure to obtain regulatory approval for our

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Securing regulatory approvals to market a product requires the submission of pre-clinical, clinical, and/or

pharmacokinetic data, information about product manufacturing processes and inspection of facilities, proposed product labeling and supporting information to the

appropriate regulatory authorities for each therapeutic indication to establish a product candidate’s safety and efficacy for each

Our product candidates may prove to have undesirable or unintended side effects, toxicities or other characteristics that

may preclude us from obtaining regulatory approval or prevent or limit commercial use with respect to one or all intended indications.

pharmacokinetic data, information about product manufacturing processes and inspection of facilities, proposed product labeling and supporting

information to the appropriate regulatory authorities for each therapeutic indication to establish a product candidate’s safety

and efficacy for each indication.

Our product candidates may prove to have undesirable or unintended side effects, toxicities or other

characteristics that may preclude us from obtaining regulatory approval or prevent or limit commercial use with respect to one or all

intended indications.

The process of obtaining regulatory approvals

is expensive, often takes many years, if approval is obtained at all, and can vary substantially based upon, among other things, the type,

complexity and novelty of the product candidates involved, the jurisdiction in which regulatory approval is sought and the substantial

is expensive, often takes many years, if approval is obtained at all, and can vary substantially based upon, among other things, the

type, complexity and novelty of the product candidates involved, the jurisdiction in which regulatory approval is sought and the substantial

discretion of the regulatory authorities.

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from such additional activities would be sufficient to obtain approval.

If the data to be relied upon in a 505(b)(2) application

is related to drug products previously approved by the FDA and covered by patents that are listed in the FDA’s Orange Book, we would

be required to submit with our 505(b)(2) application a Paragraph IV Certification in which we must certify that we do not infringe the

listed patents or that such patents are invalid or unenforceable, and provide notice to the patent owner or the holder of the approved

The patent owner or NDA holder would have 45 days from receipt of the notification of our Paragraph IV Certification to initiate

a patent infringement action against us.

If an infringement action is initiated, the approval of our NDA would be subject to a stay of

up to 30 months or more while we defend against such a suit.

Approval of our product candidates under Section 505(b)(2) may therefore

be delayed until patent exclusivity expires or until we successfully challenge the applicability of those patents to our product candidates.

Alternatively, we may elect to generate sufficient clinical data so that we would no longer need to rely on third-party data, which would

be costly and time consuming and there would be no assurance that such data generated from such additional activities would be sufficient

to obtain approval.

If the data to be relied upon in a 505(b)(2)

application is related to drug products previously approved by the FDA and covered by patents that are listed in the FDA’s Orange

Book, we would be required to submit with our 505(b)(2) application a Paragraph IV Certification in which we must certify that we do

not infringe the listed patents or that such patents are invalid or unenforceable, and provide notice to the patent owner or the holder

of the approved NDA.

The patent owner or NDA holder would have 45 days from receipt of the notification of our Paragraph IV Certification

to initiate a patent infringement action against us.

If an infringement action is initiated, the approval of our NDA would be subject

to a stay of up to 30 months or more while we defend against such a suit.

Approval of our product candidates under Section 505(b)(2)

may therefore be delayed until patent exclusivity expires or until we successfully challenge the applicability of those patents to our

product candidates.

Alternatively, we may elect to generate sufficient clinical data so that we would no longer need to rely on third-party

data, which would be costly and time consuming and there would be no assurance that such data generated from such additional activities

would be sufficient to obtain approval.

We may not be able to obtain shortened review

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If we are required to generate

additional data to support approval, we may be unable to meet anticipated or reasonable development and commercialization timelines, may

be unable to generate the additional data at a reasonable cost, or at all, and may be unable to obtain marketing approval.

changes its interpretation of Section 505(b)(2) allowing reliance on data in a previously approved drug application owned by a third party,

additional data to support approval, we may be unable to meet anticipated or reasonable development and commercialization timelines,

may be unable to generate the additional data at a reasonable cost, or at all, and may be unable to obtain marketing approval.

FDA changes its interpretation of Section 505(b)(2) allowing reliance on data in a previously approved drug application owned by a third-party,

or there is a change in the law affecting Section 505(b)(2), this could delay or even prevent the FDA from approving any Section 505(b)(2)

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(i.e., another product is safer, more effective or makes a major contribution to patient care) to the product with orphan exclusivity.

Competitors, however, may receive approval of different products for the 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.

In addition, exclusive

marketing rights in the United States may be limited if we seek approval for an indication broader than the orphan-designated indication

or may be lost if the FDA later determines that the request for designation was materially defective.

Competitors, however, may receive approval of different products for the 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.

exclusive marketing rights in the United States may be limited if we seek approval for an indication broader than the orphan-designated

indication or may be lost if the FDA later determines that the request for designation was materially defective.

Modifications to our products may require

new drug or device approvals.

new drug approvals.

Once a particular product receives FDA approval

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already being promoted for these new indications, we may also be subject to significant enforcement actions.

Conducting clinical trials and

obtaining clearances and approvals can be a time-consuming process, and delays in obtaining required future clearances or approvals could

adversely affect our ability to introduce new or enhanced products in a timely manner, which in turn would harm our future growth.

Conducting successful clinical studies may

require the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit.

Conducting clinical trials

and obtaining clearances and approvals can be a time-consuming process, and delays in obtaining required future clearances or approvals

could adversely affect our ability to introduce new or enhanced products in a timely manner, which in turn would harm our future growth.

Conducting successful clinical studies

may require the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit.

Patient enrollment in clinical trials and completion

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not attractive or involve unacceptable risks or discomforts.

Patients may also not participate in our clinical trials if they choose to

participate in contemporaneous clinical trials of competitive products.

Additional delays to the completion of clinical

studies may result from modifications being made to the protocol during the clinical trial, if such modifications are warranted and/or

required by the occurrences in the given trial .

Patients may also not participate in our clinical trials if they choose

to participate in contemporaneous clinical trials of competitive products.

Additional delays to the completion of

clinical studies may result from modifications being made to the protocol during the clinical trial, if such modifications are warranted

and/or required by the occurrences in the given trial .

Each modification to the protocol during a clinical

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There can be no assurance that the data generated

using modified protocols will be acceptable to the FDA or that if future modifications during the trial are necessary, that any such modifications

will be acceptable to the FDA.

If the FDA believes that its prior approval is required for a particular modification, it can delay or

halt a clinical trial while it evaluates additional information regarding the change.

using modified protocols will be acceptable to the FDA or that if future modifications during the trial are necessary, that any such

modifications will be acceptable to the FDA.

If the FDA believes that its prior approval is required for a particular modification, it

can delay or halt a clinical trial while it evaluates additional information regarding the change.

Serious injury or death resulting from a failure

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trial, which could adversely affect our business, operating results and prospects.

We rely on third parties to conduct our

clinical trials and to assist us with pre-clinical development.

If these third parties do not perform as contractually required or expected,

we may not be able to obtain regulatory approval for or commercialize our products.

We rely on and intend to rely on

third-parties to conduct our clinical trials and to assist us with pre-clinical development.

If these third-parties do not perform

as contractually required or expected, we may not be able to obtain regulatory approval for or commercialize our products.

We do not have the ability to independently conduct

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affect our business, operating results and prospects.

We rely on and intend to rely on third parties

to manufacture our clinical product supplies, and to produce and process our product candidates, if approved.

Our commercialization of

any of our product candidates could be stopped, delayed, or made less profitable if those third parties fail to obtain approval of government

regulators, fail to provide us with sufficient quantities of drug product, devices, or device components, or fail to do so at acceptable

quality levels or prices.

We do not currently have, nor do we currently

plan to develop, the infrastructure or capability internally to manufacture our clinical supplies for use in the conduct of our clinical

trials, and we lack the resources and the capability to manufacture any of our product candidates, devices, or device components on a

clinical or commercial scale.

We currently rely on outside vendors to manufacture our clinical supplies of our product candidates and

plan to continue relying on third parties to manufacture our product candidates, devices, or device components on a commercial scale,

In particular, we rely upon single-sourced manufacturing with one third-party contract development and manufacturing organization

(a “CDMO”), WuXi AppTec (“WuXi”) for HT-KIT.

In January 2024, the BIOSECURE Act (H.R.

was introduced in the House of Representatives and a substantially similar bill (S.3558) was introduced in the Senate.

If these bills

became law, or similar laws are passed, they would have the potential to severely restrict the ability of U.S.

biopharmaceutical companies

to contract with certain Chinese biotechnology companies “of concern” without losing the ability to contract with, or otherwise

receive funding from, the U.S.

We do business with companies in China and it is possible some of our contractual counterparties

could be impacted by this legislation.

reliance on third-party manufacturers exposes us to the following additional risks:

● We may be unable to identify manufacturers of our product

candidates on acceptable terms or at all.

● Our third-party manufacturers might be unable to timely formulate

and manufacture our product or produce the quantity and quality required to meet our clinical and commercial needs, if any.

● Contract manufacturers may not be able to execute our manufacturing

procedures appropriately.

● Our future third-party manufacturers may not perform as agreed

or may not remain in the contract manufacturing business for the time required to supply our clinical trials or to successfully produce,

store, and distribute our commercial products, if approved.

● Our reliance on single-sourced manufacturing with WuXi increases

the risk that any problems or delays with WuXi could materially, negatively affect the development of our product candidates.

● Manufacturers are subject to ongoing periodic unannounced

inspection by the FDA and some state agencies to ensure strict compliance with cGMPs and other government regulations and corresponding

foreign standards.

We do not have control over third-party manufacturers’ compliance with these regulations and standards.

● We may not own, or may have to share, the intellectual property

rights to any improvements made by our third-party manufacturers in the manufacturing process for our product candidates.

● Our third-party manufacturers could breach or terminate their

agreement with us.

● Our third-party manufacturers’ performance, available

capacity and ability to manufacture clinical or commercial products may be impacted by mergers and or acquisitions.

● We and our third-party manufacturers may be impacted by global

conflicts, including any potential conflict involving China and Taiwan, and any resulting trade sanctions.

● Foreign third-party manufacturers may be subject to U.S.

legislation or investigations, including the proposed BIOSECURE Act, trade restrictions and other foreign regulatory requirements, which

could increase the cost or reduce the supply of HT-KIT, delay the procurement or supply of HT-KIT or delay clinical trials.

Each of these risks could delay our clinical trials,

as well as the approval, if any, of our product candidates by the FDA, or the commercialization of our product candidates, or could result

in higher costs, or could deprive us of potential product revenue.

We currently rely on foreign CROs and CDMOs, including

WuXi, to manufacture HT-KIT, and will likely continue to rely on foreign CROs and CDMOs in the future.

Foreign CDMOs may be subject to

legislation or investigations, including the proposed BIOSECURE Act, sanctions, trade restrictions and other foreign regulatory

requirements, which could increase the cost or reduce the supply of HT-KIT, delay the procurement or supply of HT-KIT, delay or impact

clinical trials and could adversely affect our financial condition and business prospects.

While we assume we could replace WuXi, this

could be time consuming and expensive, which may adversely affect our financial condition and business prospects.

The future results of our current or future

clinical trials may not support our product candidate claims or may result in the discovery of unexpected adverse side effects.

Even if our clinical trials are completed as planned,

we cannot be certain that their results will support our drug candidate claims or that the FDA or foreign regulatory agencies will agree

with our conclusions regarding them.

Success in pre-clinical studies and early clinical trials does not ensure that later clinical trials

will be successful, and we cannot be sure that the later trials will replicate the results of prior trials and pre-clinical studies.

clinical trial process may fail to demonstrate that our drug candidates are safe and effective for the proposed indicated uses.

FDA or other regulatory agencies conclude that the clinical trials for any of our product candidates has failed to demonstrate safety

and effectiveness, we would not receive clearance from the FDA or other regulatory agencies to market that product in the United States

or internationally for the indications sought.

Even if our clinical trials are completed as

planned, we cannot be certain that their results will support our drug candidate claims or that the FDA or foreign regulatory agencies

will agree with our conclusions regarding them.

Success in pre-clinical studies and early clinical trials does not ensure that later

clinical trials will be successful, and we cannot be sure that the later trials will replicate the results of prior trials and pre-clinical

The clinical trial process may fail to demonstrate that our drug candidates are safe and effective for the proposed indicated

If the FDA or other regulatory agencies conclude that the clinical trials for any of our product candidates has failed to demonstrate

safety and effectiveness, we would not receive clearance from the FDA or other regulatory agencies to market that product in the United

States or internationally for the indications sought.

In addition, such an outcome could cause us to

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with FDA’s Quality System Regulations and International Standards Organization (“ISO”) regulations for the manufacture

of our products and other regulations which cover the methods and documentation of the design, testing, production, control, quality assurance,

labeling, packaging, storage and shipping of any product for which we obtain clearance or approval.

Regulatory bodies, such as the FDA,

enforce these regulations through periodic inspections.

The failure by us or one of our suppliers to comply with applicable statutes and

regulations administered by the FDA and other regulatory bodies, or the failure to timely and adequately respond to any adverse inspectional

observations or product safety issues, could result in, among other things, enforcement actions by the FDA.

of our products and other regulations which cover the methods and documentation of the design, testing, production, control, quality

assurance, labeling, packaging, storage and shipping of any product for which we obtain clearance or approval.

Regulatory bodies, such

as the FDA, enforce these regulations through periodic inspections.

The failure by us or one of our suppliers to comply with applicable

statutes and regulations administered by the FDA and other regulatory bodies, or the failure to timely and adequately respond to any

adverse inspectional observations or product safety issues, could result in, among other things, enforcement actions by the FDA.

If any of these actions were to occur it would

harm our reputation and cause our product sales and profitability to suffer and may prevent us from generating revenue.

Furthermore, our

key component suppliers may not currently be or may not continue to be in compliance with all applicable regulatory requirements which

could result in our failure to produce our products on a timely basis and in the required quantities, if at all.

our key component suppliers may not currently be or may not continue to be in compliance with all applicable regulatory requirements

which could result in our failure to produce our products on a timely basis and in the required quantities, if at all.

Even if regulatory clearance or approval of a

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and reduce the potential to successfully commercialize the product and generate revenue from the product.

If the FDA determines that the

product promotional materials, labeling, training or other marketing or educational activities constitute promotion of an unapproved use,

it could request that we or our commercialization partners cease or modify our training or promotional materials or subject us to regulatory

enforcement actions.

It is also possible that other federal, state or foreign enforcement authorities might take action if they consider

such training or other promotional materials to constitute promotion of an unapproved use, which could result in significant fines or

penalties under other statutory authorities, such as laws prohibiting false claims for reimbursement.

If the FDA determines that

the product promotional materials, labeling, training or other marketing or educational activities constitute promotion of an unapproved

use, it could request that we or our commercialization partners cease or modify our training or promotional materials or subject us to

regulatory enforcement actions.

It is also possible that other federal, state or foreign enforcement authorities might take action if

they consider such training or other promotional materials to constitute promotion of an unapproved use, which could result in significant

fines or penalties under other statutory authorities, such as laws prohibiting false claims for reimbursement.

In addition, we may be required to conduct costly

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directly related to, our products.

Later discovery of previously unknown problems with our products, including unanticipated adverse events

or adverse events of unanticipated severity or frequency, manufacturing problems, or failure to comply with regulatory requirements, may

result in changes to labeling, restrictions on such products or manufacturing processes, withdrawal of the products from the market, voluntary

or mandatory recalls, a requirement to recall, replace or refund the cost of any product we manufacture or distribute, fines, suspension

of regulatory approvals, product seizures, injunctions or the imposition of civil or criminal penalties which would adversely affect our

business, operating results and prospects.

Later discovery of previously unknown problems with our products, including unanticipated adverse

events or adverse events of unanticipated severity or frequency, manufacturing problems, or failure to comply with regulatory requirements,

may result in changes to labeling, restrictions on such products or manufacturing processes, withdrawal of the products from the market,

voluntary or mandatory recalls, a requirement to recall, replace or refund the cost of any product we manufacture or distribute, fines,

suspension of regulatory approvals, product seizures, injunctions or the imposition of civil or criminal penalties which would adversely

affect our business, operating results and prospects.

Our revenue stream will depend upon third-party

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However, the availability of insurance coverage and reimbursement for newly approved therapies is uncertain,

and therefore, third-party coverage may be particularly difficult to obtain even if our products are approved by the FDA as safe and efficacious.

Patients using existing approved therapies are generally reimbursed all or part of the product cost by Medicare or other third-party payors.

Medicare, Medicaid, health maintenance organizations and other third-party payors are increasingly attempting to contain healthcare costs

by limiting both coverage and the level of reimbursement of new drugs, and, as a result, they may not cover or provide adequate payment

for these products.

Submission of applications for reimbursement approval generally does not occur prior to the filing of an NDA for that

product and may not be granted for as long as many months after NDA approval.

In order to obtain reimbursement arrangements for these

products, we or our commercialization partners may have to agree to a net sales price lower than the net sales price we might charge in

other sales channels.

The continuing efforts of government and third-party payors to contain or reduce the costs of healthcare may limit

Initial dependence on the commercial success of our products may make our revenues particularly susceptible to any cost containment

or reduction efforts.

and therefore, third-party coverage may be particularly difficult to obtain even if our products are approved by the FDA as safe and

Patients using existing approved therapies are generally reimbursed all or part of the product cost by Medicare or other

third-party payors.

Medicare, Medicaid, health maintenance organizations and other third-party payors are increasingly attempting to

contain healthcare costs by limiting both coverage and the level of reimbursement of new drugs, and, as a result, they may not cover

or provide adequate payment for these products.

Submission of applications for reimbursement approval generally does not occur prior

to the filing of an NDA for that product and may not be granted for as long as many months after NDA approval.

In order to obtain reimbursement

arrangements for these products, we or our commercialization partners may have to agree to a net sales price lower than the net sales

price we might charge in other sales channels.

The continuing efforts of government and third-party payors to contain or reduce the costs

of healthcare may limit our revenue.

Initial dependence on the commercial success of our products may make our revenues particularly

susceptible to any cost containment or reduction efforts.

Current and future legislation may increase

the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and affect the prices we may obtain

for such product candidates.

the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and affect the prices we may

obtain for such product candidates.

In the United States and some foreign jurisdictions,

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for drug purchases by the elderly and introduced a new reimbursement methodology based on average sales prices for drugs.

this legislation authorized Medicare Part D prescription drug plans to use formularies where they can limit the number of drugs that will

be covered in any therapeutic class.

As a result of this legislation and the expansion of federal coverage of drug products, we expect

that there will be additional pressure to contain and reduce costs.

These cost reduction initiatives and other provisions of this legislation

could decrease the coverage and price that we receive for our product candidates and could seriously harm our business.

While the MMA

applies only to drug benefits for Medicare beneficiaries, private payors often follow Medicare coverage policy and payment limitations

this legislation authorized Medicare Part D prescription drug plans to use formularies where they can limit the number of drugs that

will be covered in any therapeutic class.

As a result of this legislation and the expansion of federal coverage of drug products, we

expect that there will be additional pressure to contain and reduce costs.

These cost reduction initiatives and other provisions of this

legislation could decrease the coverage and price that we receive for our product candidates and could seriously harm our business.

the MMA applies only to drug benefits for Medicare beneficiaries, private payors often follow Medicare coverage policy and payment limitations

in setting their own reimbursement rates, and any reduction in reimbursement that results from the MMA may result in a similar reduction

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is a sweeping law intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies

against fraud and abuse, add new transparency requirements for healthcare and health insurance industries, impose new taxes and fees on

the health industry and impose additional health policy reforms.

The Health Care Reform Law revised the definition of “average manufacturer

price” for reporting purposes, which could increase the amount of Medicaid drug rebates to states.

Further, the law imposed a significant

annual fee on companies that manufacture or import branded prescription drug products.

against fraud and abuse, add new transparency requirements for healthcare and health insurance industries, impose new taxes and fees

on the health industry and impose additional health policy reforms.

The Health Care Reform Law revised the definition of “average

manufacturer price” for reporting purposes, which could increase the amount of Medicaid drug rebates to states.

Further, the law

imposed a significant annual fee on companies that manufacture or import branded prescription drug products.

The Health Care Reform Law remains subject to

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However, if the Health Care Reform Law is repealed or modified,

or if implementation of certain aspects of the Health Care Reform Law are delayed, such repeal, modification or delay may materially adversely

impact our business, strategies, prospects, operating results or financial condition.

We are unable to predict the full impact of any

repeal, modification or delay in the implementation of the Health Care Reform Law on us at this time.

or if implementation of certain aspects of the Health Care Reform Law are delayed, such repeal, modification or delay may materially

adversely impact our business, strategies, prospects, operating results or financial condition.

We are unable to predict the full impact

of any repeal, modification or delay in the implementation of the Health Care Reform Law on us at this time.

Due to the substantial regulatory

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proposed and adopted in the United States since the Health Care Reform Law was enacted.

We expect that additional 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

We expect that additional 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, and in turn could significantly reduce the projected value of certain development projects and reduce or eliminate

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candidates for commercial sale nor do we have the resources necessary to do so.

In addition, we currently do not have the capability to

market our drug products ourselves.

In addition to our internal sales force efforts, we have contracted with and intend to continue to

contract with specialized manufacturing companies to manufacture our proposed product candidates and partner with larger pharmaceutical

In addition, we currently do not have the capability

to market our drug products ourselves.

In addition to our internal sales force efforts, we have contracted with and intend to continue

to contract with specialized manufacturing companies to manufacture our proposed product candidates and partner with larger pharmaceutical

companies for commercialization of our products.

In connection with our efforts to commercialize our proposed product candidates, we will

seek to secure favorable arrangements with third parties to distribute, promote, market and sell our proposed product candidates.

internal sales force is unable to successfully distribute, market and promote our product candidates and we are not able to secure favorable

commercial terms or arrangements with third parties for the distribution, marketing, promotion and sales of our proposed product candidates,

we may have to retain promotional and marketing rights and seek to develop the commercial resources necessary to promote or co-promote

or co-market certain or all of our proposed drug candidates to the appropriate channels of distribution in order to reach the specific

medical market that we are targeting.

We may not be able to enter into any partnering arrangements on this or any other basis.

not able to secure favorable partnering arrangements or are unable to develop the appropriate resources necessary for the commercialization

of our proposed product candidates, our business and financial condition could be harmed.

In addition, we will have to hire additional

employees or consultants, since our current employees have limited experience in these areas.

Sufficient employees with relevant skills

may not be available to us.

Any increase in the number of our employees would increase our expense level and could have an adverse effect

on our financial position.

In addition, we, or our potential commercial partners,

may not successfully introduce our proposed product candidates or such candidates may not achieve acceptance by patients, health care

providers and insurance companies.

Further, it is possible that we may not be able to secure arrangements to manufacture, market, distribute,

promote and sell our proposed product candidates at favorable commercial terms that would permit us to make a profit.

To the extent that

corporate partners conduct clinical trials, we may not be able to control the design and conduct of these clinical trials.

In connection with our efforts to commercialize our proposed product candidates, we

will seek to secure favorable arrangements with third parties to distribute, promote, market and sell our proposed product candidates.

If our internal sales force is unable to successfully distribute, market and promote our product candidates and we are not able to secure

favorable commercial terms or arrangements with third parties for the distribution, marketing, promotion and sales of our proposed product

candidates, we may have to retain promotional and marketing rights and seek to develop the commercial resources necessary to promote

or co-promote or co-market certain or all of our proposed drug candidates to the appropriate channels of distribution in order to reach

the specific medical market that we are targeting.

We may not be able to enter into any partnering arrangements on this or any other

If we are not able to secure favorable partnering arrangements or are unable to develop the appropriate resources necessary for

the commercialization of our proposed product candidates, our business and financial condition could be harmed.

In addition, we will

have to hire additional employees or consultants, since our current employees have limited experience in these areas.

Sufficient employees

with relevant skills may not be available to us.

Any increase in the number of our employees would increase our expense level and could

have an adverse effect on our financial position.

In addition, we, or our potential commercial

partners, may not successfully introduce our proposed product candidates or such candidates may not achieve acceptance by patients, health

care providers and insurance companies.

Further, it is possible that we may not be able to secure arrangements to manufacture, market,

distribute, promote and sell our proposed product candidates at favorable commercial terms that would permit us to make a profit.

the extent that corporate partners conduct clinical trials, we may not be able to control the design and conduct of these clinical trials.

We may have conflicts with our partners

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or manufacture of the product, including providing us with product data or materials;

unwillingness on the part of a partner to keep us

informed regarding the progress of its development and commercialization activities or to permit public disclosure of the results of those

unwillingness on the part of a partner to keep

us informed regarding the progress of its development and commercialization activities or to permit public disclosure of the results

of those activities;

initiating of litigation or alternative dispute resolution options by either party to resolve the dispute;

or attempts by

either party to terminate the agreement.

Even if we receive regulatory approval for

any of our product candidates, we may not be able to successfully commercialize the product and the revenue that we generate from its

sales, if any, may be limited.

by either party to terminate the agreement.

Even if we receive regulatory approval

for any of our product candidates, we may not be able to successfully commercialize the product and the revenue that we generate from

its sales, if any, may be limited.

If approved for marketing, the commercial success

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The degree of market acceptance for any of our product candidates will depend on a number of factors, including:

demonstration of clinical safety and efficacy;

relative convenience, dosing burden and ease of administration;

the prevalence and severity of any adverse effects;

the willingness of physicians to prescribe our product candidates, and the target patient population to try new therapies;

efficacy of our product candidates compared to competing products;

the introduction of any new products that may in the future become available targeting indications for which our product candidates may be approved;

new procedures or therapies that may reduce the incidences of any of the indications in which our product candidates may show utility;

demonstration of clinical

safety and efficacy;

relative convenience, dosing

burden and ease of administration;

the prevalence and severity

of any adverse effects;

the willingness of physicians

to prescribe our product candidates, and the target patient population to try new therapies;

efficacy of our product

candidates compared to competing products;

the introduction of any

new products that may in the future become available targeting indications for which our product candidates may be approved;

new procedures or therapies

that may reduce the incidences of any of the indications in which our product candidates may show utility;

pricing and cost-effectiveness;

the inclusion or omission of our product candidates in applicable therapeutic and vaccine guidelines;

the effectiveness of our own or any future collaborators’ sales and marketing strategies;

limitations or warnings contained in approved labeling from regulatory authorities;

our ability to obtain and maintain sufficient third-party coverage or reimbursement from government health care programs, including Medicare and Medicaid, private health insurers and other third-party payors or to receive the necessary pricing approvals from government bodies regulating the pricing and usage of therapeutics;

the willingness of patients to pay out-of-pocket in the absence of third-party coverage or reimbursement or government pricing approvals.

the inclusion or omission

of our product candidates in applicable therapeutic and vaccine guidelines;

the effectiveness of our

own or any future collaborators’ sales and marketing strategies;

limitations or warnings

contained in approved labeling from regulatory authorities;

our ability to obtain and

maintain sufficient third-party coverage or reimbursement from government health care programs, including Medicare and Medicaid,

private health insurers and other third-party payors or to receive the necessary pricing approvals from government bodies regulating

the pricing and usage of therapeutics;

the willingness of patients

to pay out-of-pocket in the absence of third-party coverage or reimbursement or government pricing approvals.

If any of our product candidates are approved,

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The FDA will not approve the NDA without an approved REMS, if required.

A REMS could include

medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries

and other risk minimization tools.

include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient

registries and other risk minimization tools.

The FDA may also require a REMS for an approved product when new safety information emerges.

these limitations on approval or marketing could restrict the commercial promotion, distribution, prescription or dispensing of our product

Moreover, product approvals may be withdrawn for non-compliance with regulatory standards or if problems occur following the

initial marketing of the product.

Any of the foregoing scenarios could materially harm the commercial success of our product candidates.

Any of these limitations on approval or marketing could restrict the commercial promotion, distribution, prescription or dispensing of

our product candidates.

Moreover, product approvals may be withdrawn for non-compliance with regulatory standards or if problems occur

following the initial marketing of the product.

Any of the foregoing scenarios could materially harm the commercial success of our product

Our products will face significant competition,

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and clinical testing of products, obtaining regulatory approvals, and manufacturing and marketing pharmaceutical products.

They also have

greater name recognition and better access to customers than us.

have greater name recognition and better access to customers than us.

Adverse events involving our products may

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or defects in design or manufacture.

With respect to the FDA, the authority to require a recall must be based on an FDA finding that there

is a reasonable probability that the product would cause serious injury or death.

Manufacturers may, under their own initiative, recall

a product if any material deficiency in a product is found.

With respect to the FDA, the authority to require a recall must be based on an FDA finding that

there is a reasonable probability that the product would cause serious injury or death.

Manufacturers may, under their own initiative,

recall a product if any material deficiency in a product is found.

A government-mandated or voluntary recall by us or one of our distributors

could occur as a result of adverse side effects, impurities or other product contamination, manufacturing errors, design or labeling defects

or other deficiencies and issues.

Recalls of any of our products would divert managerial and financial resources and have an adverse effect

on our financial condition and results of operations.

In addition, the FDA requires that certain classifications of recalls be reported

to FDA within ten working days after the recall is initiated.

Companies are required to maintain certain records of recalls, even if they

are not reportable to the FDA.

We may initiate voluntary recalls involving our products in the future that we determine do not require

notification of the FDA.

If the FDA disagrees with our determinations, they could require us to report those actions as recalls.

recall announcement could harm our reputation with customers and negatively affect our sales.

In addition, the FDA could take enforcement

action for failing to report the recalls when they were conducted.

could occur as a result of adverse side effects, impurities or other product contamination, manufacturing errors, design or labeling

defects or other deficiencies and issues.

Recalls of any of our products would divert managerial and financial resources and have an

adverse effect on our financial condition and results of operations.

In addition, the FDA requires that certain classifications of recalls

be reported to FDA within ten working days after the recall is initiated.

Companies are required to maintain certain records of recalls,

even if they are not reportable to the FDA.

We may initiate voluntary recalls involving our products in the future that we determine

do not require notification of the FDA.

If the FDA disagrees with our determinations, they could require us to report those actions as

A future recall announcement could harm our reputation with customers and negatively affect our sales.

In addition, the FDA

could take enforcement action for failing to report the recalls when they were conducted.

If we fail to comply with healthcare regulations,

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include the following:

the federal Anti-Kickback Statute makes it illegal for any person or entity to knowingly and willfully, directly or indirectly, solicit, receive, offer, or pay any remuneration that is in exchange for or to induce the referral of business, including the purchase, order, lease of any good, facility, item or service for which payment may be made under a federal healthcare program, such as Medicare or Medicaid.

The term “remuneration” has been broadly interpreted to include anything of value;

the Omnibus Budget Reconciliation Act of

1993 (42 U.S.C.

§ 1395nn) (the “Stark Law”) prohibit referrals by a physician of “designated health services”

which are payable, in whole or in part, by Medicare or Medicaid, to an entity in which the physician or the physician’s immediate family

member has an investment interest or other financial relationship, subject to several exceptions.

The Stark Law also prohibits billing

for services rendered pursuant to a prohibited referral.

Several states have enacted laws similar to the Stark Law.

These state laws

may cover all (not just Medicare and Medicaid) patients.

Many federal healthcare reform proposals in the past few years have attempted

to expand the Stark Law to cover all patients as well.

We consider the Stark Law in planning our products, marketing and other activities,

and believe that our operations are in compliance with the Stark Law.

If we violate the Stark Law, our financial results and operations

could be adversely affected.

Penalties for violations include denial of payment for the services, significant civil monetary penalties,

and exclusion from the Medicare and Medicaid programs;

federal false claims and false statement laws, including the federal civil False Claims Act and the Civil Monetary Penalties Law (“CMPL”), prohibits, among other things, any person or entity from knowingly presenting, or causing to be presented, for payment to, or approval by, federal programs, including Medicare and Medicaid, claims for items or services, including drugs, that are false or fraudulent;

HIPAA, created additional federal criminal statutes that prohibit among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private third-party payors or making any false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services;

HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 and their implementing regulations, impose obligations on certain types of individuals and entities regarding the electronic exchange of information in common healthcare transactions, as well as standards relating to the privacy and security of individually identifiable health information;

the FDCA which among other things, strictly regulates drug and biologics

manufacturing, sales, distribution, prohibits the adulteration or misbranding of drugs and biologics prohibits manufacturers from marketing

drug products for off-label use and regulates the distribution of drug samples;

t he federal Physician Payments Sunshine Act requires certain manufacturers

of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health

Insurance Program, with specific exceptions, to report annually to the Centers for Medicare & Medicaid Services information related

to payments or other transfers of value made to physicians and teaching hospitals, as well as ownership and investment interests held

by physicians and their immediate family members.

the federal Anti-Kickback

Statute makes it illegal for any person or entity to knowingly and willfully, directly or indirectly, solicit, receive, offer, or

pay any remuneration that is in exchange for or to induce the referral of business, including the purchase, order, lease of any good,

facility, item or service for which payment may be made under a federal healthcare program, such as Medicare or Medicaid.

“remuneration” has been broadly interpreted to include anything of value;

the Omnibus Budget Reconciliation

Act of 1993 (42 U.S.C.

§ 1395nn) (the “Stark Law”) prohibit referrals by a physician of “designated health

services” which are payable, in whole or in part, by Medicare or Medicaid, to an entity in which the physician or the physician’s

immediate family member has an investment interest or other financial relationship, subject to several exceptions.

The Stark Law

also prohibits billing for services rendered pursuant to a prohibited referral.

Several states have enacted laws similar to the Stark

These state laws may cover all (not just Medicare and Medicaid) patients.

Many federal healthcare reform proposals in the past

few years have attempted to expand the Stark Law to cover all patients as well.

We consider the Stark Law in planning our products,

marketing and other activities, and believe that our operations are in compliance with the Stark Law.

If we violate the Stark Law,

our financial results and operations could be adversely affected.

Penalties for violations include denial of payment for the services,

significant civil monetary penalties, and exclusion from the Medicare and Medicaid programs;

federal false claims and

false statement laws, including the federal civil False Claims Act and the Civil Monetary Penalties Law (“CMPL”), prohibits,

among other things, any person or entity from knowingly presenting, or causing to be presented, for payment to, or approval by, federal

programs, including Medicare and Medicaid, claims for items or services, including drugs, that are false or fraudulent;

HIPAA, created additional

federal criminal statutes that prohibit among other actions, knowingly and willfully executing, or attempting to execute, a scheme

to defraud any healthcare benefit program, including private third-party payors or making any false, fictitious or fraudulent statement

in connection with the delivery of or payment for healthcare benefits, items or services;

HIPAA, as amended by the

Health Information Technology for Economic and Clinical Health Act of 2009 and their implementing regulations, impose obligations

on certain types of individuals and entities regarding the electronic exchange of information in common healthcare transactions,

as well as standards relating to the privacy and security of individually identifiable health information;

the FDCA which among other

things, strictly regulates drug and biologics manufacturing, sales, distribution, prohibits the adulteration or misbranding of drugs

and biologics prohibits manufacturers from marketing drug products for off-label use and regulates the distribution of drug samples;

the federal Physician Payments

Sunshine Act requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under

Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to report annually to the Centers

for Medicare & Medicaid Services information related to payments or other transfers of value made to physicians and teaching

hospitals, as well as ownership and investment interests held by physicians and their immediate family members.

Also, many states have similar laws and regulations,

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are complex, changing and often subject to varying interpretations.

As a result, we may not be able to adhere to all applicable laws and

Any violation or alleged violation of any of these laws or regulations by us could have a material adverse effect on our

business, financial condition, cash flows and results of operations.

We may be a party to various lawsuits, demands, claims, qui tam

suits, government investigations and audits, of which any could result in, among other things, substantial financial penalties or awards

against us, reputational harm, termination of relationships or contracts related to our business, mandated refunds, substantial payments

made by us, required changes to our business practices, exclusion from future participation in Medicare and other healthcare programs, seizure of product

and possible criminal penalties.

As a result, we may not be able to adhere to all applicable laws

and regulations.

Any violation or alleged violation of any of these laws or regulations by us could have a material adverse effect on

our business, financial condition, cash flows and results of operations.

We may be a party to various lawsuits, demands, claims, qui

tam suits, government investigations and audits, of which any could result in, among other things, substantial financial penalties

or awards against us, reputational harm, termination of relationships or contracts related to our business, mandated refunds, substantial

payments made by us, required changes to our business practices, exclusion from future participation in Medicare and other healthcare

programs, seizure of product and possible criminal penalties.

If we are found in violation of applicable laws

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financial condition, cash flows, reputation and stock price, including:

suspension or termination of our participation in federal healthcare programs;

criminal or civil liability, fines, damages or monetary penalties for violations of healthcare fraud and abuse laws, including the federal False Claims Act, CMPL, and Anti-Kickback Statute;

enforcement actions by governmental agencies or claims for monetary damages by patients under federal or state patient privacy laws, including HIPAA;

repayment of amounts received in violation of law or applicable payment program requirements, and related monetary penalties;

mandated changes to our practices or procedures that materially increase operating expenses;

imposition of corporate integrity agreements that could subject us to ongoing audits and reporting requirements as well as increased scrutiny of our business practices;

termination of various relationships or contracts related to our business;

harm to our reputation which could negatively affect our business relationships, decrease our ability to attract or retain patients and physicians, decrease access to new business opportunities and impact our ability to obtain financing, among other things.

Responding to lawsuits and other proceedings as

well as defending ourselves in such matters will continue to require management’s attention and cause us to incur significant legal

It is also possible that criminal proceedings may be initiated against us or individuals in our business in connection with investigations

by the federal government.

suspension or termination

of our participation in federal healthcare programs;

criminal or civil liability,

fines, damages or monetary penalties for violations of healthcare fraud and abuse laws, including the federal False Claims Act, CMPL,

and Anti-Kickback Statute;

enforcement actions by

governmental agencies or claims for monetary damages by patients under federal or state patient privacy laws, including HIPAA;

repayment of amounts received

in violation of law or applicable payment program requirements, and related monetary penalties;

mandated changes to our

practices or procedures that materially increase operating expenses;

imposition of corporate

integrity agreements that could subject us to ongoing audits and reporting requirements as well as increased scrutiny of our business

termination of various

relationships or contracts related to our business;

harm to our reputation

which could negatively affect our business relationships, decrease our ability to attract or retain patients and physicians, decrease

access to new business opportunities and impact our ability to obtain financing, among other things.

Responding to lawsuits and other proceedings

as well as defending ourselves in such matters will continue to require management’s attention and cause us to incur significant

legal expense.

It is also possible that criminal proceedings may be initiated against us or individuals in our business in connection

with investigations by the federal government.

Furthermore, to the extent that our product is sold in a foreign country,

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We rely on and intend to continue to rely on CMOs to formulate and manufacture our pre-clinical and clinical materials.

Our reliance on

a CMO exposes us to a number of risks, any of which could delay or prevent the completion of our pre-clinical studies or clinical trials,

or the regulatory approval or commercialization of our product candidates, result in higher costs, or deprive us of potential product

on a CMO exposes us to a number of risks, any of which could delay or prevent the completion of our pre-clinical studies or clinical

trials, or the regulatory approval or commercialization of our product candidates, result in higher costs, or deprive us of potential

product revenues.

Some of these risks include:

our CMO failing to develop an acceptable formulation to support later-stage clinical trials for, or the commercialization of, our product candidates;

our CMO failing to manufacture our product candidate according to our specifications, the FDA’s cGMP requirements, or otherwise manufacturing material that we or the FDA may deem to be unsuitable in our clinical trials;

our CMO being unable to increase the scale of, increase the capacity for, or reformulate the form of our product candidates.

We may experience a shortage in supply, or the cost to manufacture our products may increase to the point where it may adversely affect the cost of our product candidates.

We cannot assure you that our CMO will be able to manufacture our product candidates at a suitable scale, or we will be able to find alternative manufacturers acceptable to us that can do so;

our CMO placing a priority on the manufacture of their own products, or other customers’ products;

our CMO failing to perform as agreed upon or not remain in business;

our CMOs’ plants being closed as a result of regulatory sanctions,

natural disasters, health epidemics or otherwise.

Manufacturers of pharmaceutical products are subject

to ongoing periodic inspections by the FDA, the U.S.

Drug Enforcement Administration and corresponding state and foreign agencies to ensure

strict compliance with FDA mandated cGMPs, other government regulations and corresponding foreign standards.

While we are obligated to

audit their performance, we do not have control over our CMO’s compliance with these regulations and standards.

Failure by any of

our CMOs, or us, to comply with applicable regulations could result in sanctions being imposed on us or the CMOs.

These sanctions may

include fines, injunctions, civil penalties, failure of the government to grant pre-market approval of drugs, delays, suspension or withdrawal

of approvals, seizures or recalls of product, operating restrictions and criminal prosecutions, any of which could significantly and adversely

affect our business.

our CMO failing to develop

an acceptable formulation to support later-stage clinical trials for, or the commercialization of, our product candidates;

our CMO failing to manufacture

our product candidate according to our specifications, the FDA’s cGMP requirements, or otherwise manufacturing material that

we or the FDA may deem to be unsuitable in our clinical trials;

our CMO being unable to

increase the scale of, increase the capacity for, or reformulate the form of our product candidates.

We may experience a shortage

in supply, or the cost to manufacture our products may increase to the point where it may adversely affect the cost of our product

We cannot assure you that our CMO will be able to manufacture our product candidates at a suitable scale, or we will

be able to find alternative manufacturers acceptable to us that can do so;

our CMO placing a priority

on the manufacture of their own products, or other customers’ products;

our CMO failing to perform

as agreed upon or not remain in business;

our CMOs’ plants

being closed as a result of regulatory sanctions, natural disasters, health epidemics or otherwise.

Manufacturers of pharmaceutical products are

subject to ongoing periodic inspections by the FDA, the U.S.

Drug Enforcement Administration and corresponding state and foreign agencies

to ensure strict compliance with FDA mandated cGMPs, other government regulations and corresponding foreign standards.

While we are obligated

to audit their performance, we do not have control over our CMO’s compliance with these regulations and standards.

Failure by any

of our CMOs, or us, to comply with applicable regulations could result in sanctions being imposed on us or the CMOs.

These sanctions

may include fines, injunctions, civil penalties, failure of the government to grant pre-market approval of drugs, delays, suspension

or withdrawal of approvals, seizures or recalls of product, operating restrictions and criminal prosecutions, any of which could significantly

and adversely affect our business.

In the event that we need to change our

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and state levels that seek to reduce healthcare costs.

On the federal level, the Affordable Care Act (“ACA”) was enacted in

March 2010, and included measures to significantly change the way healthcare is financed by both governmental and private insurers.

the provisions of the ACA that have been of greatest importance to the pharmaceutical and biotechnology industry are the following:

an annual, nondeductible fee on any entity that manufactures or imports certain branded prescription drugs and biologic agents, apportioned among these entities according to their market share in certain government healthcare programs;

implementation of the federal physician payment transparency requirements, sometimes referred to as the “Physician Payments Sunshine Act”;

a licensure framework for follow-on biologic products;

creation of Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research;

establishment of a Center for Medicare Innovation at the Centers for Medicare & Medicaid Services to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending;

an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program, to 23.1% and 13% of the average manufacturer price for most branded and generic drugs, respectively and capped the total rebate amount for innovator drugs at 100% of the Average Manufacturer Price;

adoption of methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for certain drugs and biologics, including our product candidates, that are inhaled, infused, instilled, implanted or injected;

extension of manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations;

expansion of eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to additional individuals and by adding new mandatory eligibility categories for individuals with income at or below 133% of the federal poverty level, thereby potentially increasing manufacturers’ Medicaid rebate liability;

creation of a Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D;

expansion of the entities eligible for discounts under the Public Health program.

Although there have been legal and political challenges

to certain aspects of the ACA, the Biden Administration has affirmed support for the law and, entered its own executive orders to enforce

and strengthen it.

Because of the volatility surrounding the implementation and enforcement of the ACA since its passage, and at this

time, the full effect that the ACA would have on a pharmaceutical manufacturer remains unclear.

This uncertainty is heightened by President

Biden’s January 28, 2021 Executive Order on Strengthening Medicaid and the Affordable Care Act which indicates that the Biden Administration

may significantly modify the ACA and further reform the ACA and other federal programs in manner that may impact our operations.

Administration has indicated that a goal of its administration is to expand and support Medicaid and the ACA and to make high-quality

healthcare accessible and affordable.

The potential increase in patients covered by government funded insurance may impact our pricing.

On the federal level, the Affordable Care Act (“ACA”) was enacted

in March 2010, and included measures to significantly change the way healthcare is financed by both governmental and private insurers.

Among the provisions of the ACA that have been of greatest importance to the pharmaceutical and biotechnology industry are the following:

an annual, nondeductible

fee on any entity that manufactures or imports certain branded prescription drugs and biologic agents, apportioned among these entities

according to their market share in certain government healthcare programs;

implementation of the federal

physician payment transparency requirements, sometimes referred to as the “Physician Payments Sunshine Act”;

a licensure framework for

follow-on biologic products;

creation of Patient-Centered

Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with

funding for such research;

establishment of a Center

for Medicare Innovation at the Centers for Medicare & Medicaid Services to test innovative payment and service delivery models

to lower Medicare and Medicaid spending, potentially including prescription drug spending;

an increase in the statutory

minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program, to 23.1% and 13% of the average manufacturer price

for most branded and generic drugs, respectively and capped the total rebate amount for innovator drugs at 100% of the Average Manufacturer

adoption of methodology

by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for certain drugs and biologics, including

our product candidates, that are inhaled, infused, instilled, implanted or injected;

extension of manufacturers’

Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations;

expansion of eligibility

criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to additional individuals and by

adding new mandatory eligibility categories for individuals with income at or below 133% of the federal poverty level, thereby potentially

increasing manufacturers’ Medicaid rebate liability;

creation of a Medicare

Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated prices

of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s

outpatient drugs to be covered under Medicare Part D;

expansion of the entities

eligible for discounts under the Public Health program.

Although there have been legal and political

challenges to certain aspects of the ACA, the Biden Administration has affirmed support for the law and, entered its own executive orders

to enforce and strengthen it.

Because of the volatility surrounding the implementation and enforcement of the ACA since its passage,

and at this time, the full effect that the ACA would have on a pharmaceutical manufacturer remains unclear.

This uncertainty is heightened

by President Biden’s January 28, 2021 Executive Order on Strengthening Medicaid and the Affordable Care Act which indicates that

the Biden Administration may significantly modify the ACA and further reform the ACA and other federal programs in manner that may impact

our operations.

The Biden Administration has indicated that a goal of its administration is to expand and support Medicaid and the ACA

and to make high-quality healthcare accessible and affordable.

The potential increase in patients covered by government funded insurance

may impact our pricing.

Further, it is possible that the Biden Administration may further increase scrutiny of drug pricing.

Indeed, the Biden Administration

has been vocal that lowering prescription drug prices is a priority for the Biden Administration.

the Biden Administration has been vocal that lowering prescription drug prices is a priority for the Biden Administration.

In addition, we cannot predict the likelihood,

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Legally mandated price controls on payment amounts by

third-party payors or other restrictions could harm a pharmaceutical manufacturer’s business, results of operations, financial condition

and prospects.

In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine

what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.

reduce ultimate demand for certain products or put pressure product pricing, which could negatively affect a pharmaceutical manufacturer’s

business, results of operations, financial condition and prospects.

third-party payors or other restrictions could harm a pharmaceutical manufacturer’s business, results of operations, financial

condition and prospects.

In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures

to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.

This could reduce ultimate demand for certain products or put pressure product pricing, which could negatively affect a pharmaceutical

manufacturer’s business, results of operations, financial condition and prospects.

In addition, given recent federal and state government

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industry-wide pressure to reduce prescription drug prices.

This could harm a pharmaceutical manufacturer’s ability to generate revenue.

Increases in importation or re-importation of pharmaceutical products from foreign countries into the United States could put competitive

pressure on a pharmaceutical manufacturer’s ability to profitably price products, which, in turn, could adversely affect business,

results of operations, financial condition and prospects.

A pharmaceutical manufacturer might elect not to seek approval for or market

products in foreign jurisdictions in order to minimize the risk of re-importation, which could also reduce the revenue generated from

product sales.

This could harm a pharmaceutical manufacturer’s ability to generate

Increases in importation or re-importation of pharmaceutical products from foreign countries into the United States could put

competitive pressure on a pharmaceutical manufacturer’s ability to profitably price products, which, in turn, could adversely affect

business, results of operations, financial condition and prospects.

A pharmaceutical manufacturer might elect not to seek approval for

or market products in foreign jurisdictions in order to minimize the risk of re-importation, which could also reduce the revenue generated

from product sales.

It is also possible that other legislative proposals having similar effects will be adopted.

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levels and statutory, regulatory and policy changes.

Security threats to our information technology

infrastructure and/or our physical buildings could expose us to liability and damage our reputation and business.

Our business may be adversely affected

by cybersecurity threats, information systems interruptions and/or threats to our physical buildings.

It is essential to our business strategy that

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to be secure.

Despite security measures, however, any network infrastructure may be vulnerable to cyber-attacks by hackers and other security

We may face cyber-attacks that attempt to penetrate our network security, sabotage or otherwise disable our research, products

and services, misappropriate our or our customers’ and partners’ proprietary information, which may include personally identifiable

information, or cause interruptions of our internal systems and services.

Despite security measures, we also cannot guarantee security

of our physical buildings.

Physical building penetration or any cyber-attacks could negatively affect our reputation, damage our network

infrastructure and our ability to deploy our products and services, harm our relationship with customers and partners that are affected,

and expose us to financial liability.

Despite security measures, however, any network infrastructure may be vulnerable to cyber-attacks by hackers and other

security threats.

We may face cybersecurity threats that attempt to penetrate our network security, sabotage or otherwise disable our

research, products and services, misappropriate our or our customers’ and partners’ proprietary information, which may include

personally identifiable information, or cause interruptions or failures of our internal systems and services.

Despite security measures,

we also cannot guarantee security of our physical buildings.

Physical building penetration or any cybersecurity threats could negatively

affect our reputation, damage our network infrastructure and our ability to deploy our products and services, harm our relationship with

customers and partners that are affected, and expose us to financial liability.

Although we continue to review and enhance our

systems and cybersecurity controls, we may experience cybersecurity threats, including threats to our information technology infrastructure

and attempts to gain access to our sensitive information, as do our customers and suppliers.

Although we maintain information security

policies and procedures to prevent, detect, and mitigate these threats, information system disruptions, equipment failures or cybersecurity

attacks, such as unauthorized access, malicious software and other intrusions, could still occur and may lead to potential data corruption,

exposure of proprietary and confidential information.

Further, while we work cooperatively with our customers and suppliers to seek to

minimize the impacts of cybersecurity threats, other security threats or business disruptions, in addition to our internal processes,

procedures and systems, we must also rely on the safeguards put in place by those entities.

Any intrusion, disruption, breach or similar

event may cause operational stoppages, fines, penalties, diminished competitive advantages through reputational damages and increased

operational costs.

The costs related to cybersecurity or other security threats or disruptions may not be fully mitigated by insurance

or other means.

In addition to existing risks, any adoption or deployment of new technologies may increase our exposure to risks, breaches,

or failures, which could materially adversely affect our results of operations or financial condition.

Additionally, there are a number of state, federal

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insurance plans, or, collectively, covered entities, and also grants individuals rights with respect to their health information.

also imposes compliance obligations and corresponding penalties for non-compliance on individuals and entities that provide services to

healthcare providers and other covered entities.

As part of the American Recovery and Reinvestment Act of 2009 (“ARRA”) the

privacy and security provisions of HIPAA were amended.

ARRA also made significant increases in the penalties for improper use or disclosure

of an individual’s health information under HIPAA and extended enforcement authority to state attorneys general.

As amended by ARRA

and subsequently by the final omnibus rule adopted in 2013, HIPAA also imposes notification requirements on covered entities in the event

that certain health information has been inappropriately accessed or disclosed, notification requirements to individuals, federal regulators,

and in some cases, notification to local and national media.

Notification is not required under HIPAA if the health information that is

improperly used or disclosed is deemed secured in accordance with encryption or other standards developed by the U.S.

Department of Health

and Human Services.

Most states have laws requiring notification of affected individuals and/or state regulators in the event of a breach

of personal information, which is a broader class of information than the health information protected by HIPAA.

Many state laws impose

significant data security requirements, such as encryption or mandatory contractual terms, to ensure ongoing protection of personal information.

also imposes compliance obligations and corresponding penalties for non-compliance on individuals and entities that provide services

to healthcare providers and other covered entities.

As part of the American Recovery and Reinvestment Act of 2009 (“ARRA”)

the privacy and security provisions of HIPAA were amended.

ARRA also made significant increases in the penalties for improper use or

disclosure of an individual’s health information under HIPAA and extended enforcement authority to state attorneys general.

amended by ARRA and subsequently by the final omnibus rule adopted in 2013, HIPAA also imposes notification requirements on covered entities

in the event that certain health information has been inappropriately accessed or disclosed, notification requirements to individuals,

federal regulators, and in some cases, notification to local and national media.

Notification is not required under HIPAA if the health

information that is improperly used or disclosed is deemed secured in accordance with encryption or other standards developed by the

Department of Health and Human Services.

Most states have laws requiring notification of affected individuals and/or state regulators

in the event of a breach of personal information, which is a broader class of information than the health information protected by HIPAA.

Many state laws impose significant data security requirements, such as encryption or mandatory contractual terms, to ensure ongoing protection

of personal information.

Activities outside of the U.S.

implicate local and national data protection standards, impose additional compliance requirements and generate

additional risks of enforcement for non-compliance.

We may be required to expend significant capital and other resources to ensure ongoing

compliance with applicable privacy and data security laws, to protect against security breaches and hackers or to alleviate problems caused

by such breaches.

implicate local and national data protection standards, impose additional compliance

requirements and generate additional risks of enforcement for non-compliance.

We may be required to expend significant capital and other

resources to ensure ongoing compliance with applicable privacy and data security laws, to protect against security breaches and hackers

or to alleviate problems caused by such breaches.

Risks Related to Our Intellectual Property

We rely upon licenses granted to us by various

licensors, and if such licensors do not adequately defend such licenses, our business may be harmed.

We have entered into and may, in the future, enter

into license and sublicense agreements with respect to our product candidates.

We have limited control over the activities of our licensors,

and we rely upon our licensors to protect their intellectual property, including the patents covered by our licenses.

We cannot be certain

that activities conducted by our licensors have been or will be conducted in compliance with applicable laws and regulations.

we have no or limited control or input over whether, and in what manner, our licensors may enforce or defend the patents that we license

against a third-party.

Our licensors may defend the patents we license less vigorously than if we had enforced or defended the patents

Furthermore, our licensors may not necessarily seek enforcement in scenarios in which we would feel that enforcement was in

our best interests.

We rely upon licenses granted to us by

various licensors, and if such licensors do not adequately defend such licenses, our business may be harmed.

We have entered into and may, in the future,

enter into license and sublicense agreements with respect to our product candidates.

We have limited control over the activities of our

licensors, and we rely upon our licensors to protect their intellectual property, including the patents covered by our licenses.

be certain that activities conducted by our licensors have been or will be conducted in compliance with applicable laws and regulations.

Furthermore, we have no or limited control or input over whether, and in what manner, our licensors may enforce or defend the patents

that we license against a third-party.

Our licensors may defend the patents we license less vigorously than if we had enforced or defended

the patents ourselves.

Furthermore, our licensors may not necessarily seek enforcement in scenarios in which we would feel that enforcement

was in our best interests.

For example, our licensors may not enforce the patents against a competitor of ours who is not a direct competitor

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our commercial success will depend in part on obtaining and maintaining patent, trade secret, copyright and trademark protection of our

technologies in the United States and other jurisdictions as well as successfully enforcing and defending such intellectual property rights

against third-party challenges.

We will only be able to protect our intellectual property from unauthorized use by third parties to the

extent that valid and enforceable intellectual property protection, such as patents or trade secrets, cover them.

In particular, we place

considerable emphasis on obtaining patent and trade secret protection for significant new technologies, products and processes.

the degree of future protection of our proprietary rights is uncertain because legal means afford only limited protection and may not

adequately protect our rights or permit us to gain or keep our competitive advantage.

Moreover, the degree of future protection of our

proprietary rights is uncertain for products that are currently in the early stages of development because we cannot predict which of

these products will ultimately reach the commercial market or whether the commercial versions of these products will incorporate proprietary

technologies in the United States and other jurisdictions as well as successfully enforcing and defending such intellectual property

rights against third-party challenges.

We will only be able to protect our intellectual property from unauthorized use by third parties

to the extent that valid and enforceable intellectual property protection, such as patents or trade secrets, cover them.

In particular,

we place considerable emphasis on obtaining patent and trade secret protection for significant new technologies, products and processes.

Furthermore, the degree of future protection of our proprietary rights is uncertain because legal means afford only limited protection

and may not adequately protect our rights or permit us to gain or keep our competitive advantage.

Moreover, the degree of future protection

of our proprietary rights is uncertain for products that are currently in the early stages of development because we cannot predict which

of these products will ultimately reach the commercial market or whether the commercial versions of these products will incorporate proprietary

technologies.

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it is possible that none of our pending patent applications or the pending patent applications of our licensors will result in issued

our issued patents and issued patents of our licensors may not provide a basis for commercially viable technologies, or may not

provide us with any competitive advantages, or may be challenged and invalidated by third parties;

our issued patents and issued patents of our licensors may not provide a basis for commercially viable technologies, or may

not provide us with any competitive advantages, or may be challenged and invalidated by third parties;

and, we may not develop additional

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we are unable to do so could materially harm our business.

We and/or our licensors have applied for and will

continue to apply for patents for certain products.

Such applications may not result in the issuance of any patents, and any patents now

held or that may be issued may not provide us with adequate protection from competition.

Furthermore, it is possible that patents issued

or licensed to us may be challenged successfully.

We and/or our licensors have applied for and

will continue to apply for patents for certain products.

Such applications may not result in the issuance of any patents, and any patents

now held or that may be issued may not provide us with adequate protection from competition.

Furthermore, it is possible that patents

issued or licensed to us may be challenged successfully.

In that event, if we have a preferred competitive position because of such patents,

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by the products or processes of others.

The cost of enforcing our patent rights against infringers, if such enforcement is required, could

be significant, and we do not currently have the financial resources to fund such litigation.

Further, such litigation can go on for years

and the time demands could interfere with our normal operations.

There has been substantial litigation and other proceedings regarding

patent and other intellectual property rights in the pharmaceutical industry.

We may become a party to patent litigation and other proceedings.

The cost of enforcing our patent rights against infringers, if such enforcement is required,

could be significant, and we do not currently have the financial resources to fund such litigation.

Further, such litigation can go on

for years and the time demands could interfere with our normal operations.

There has been substantial litigation and other proceedings

regarding patent and other intellectual property rights in the pharmaceutical industry.

We may become a party to patent litigation and

other proceedings.

The cost to us of any patent litigation, even if resolved in our favor, could be substantial.

Some of our competitors may be able to sustain

the costs of such litigation more effectively than we can because of their substantially greater financial resources.

Litigation may also

absorb significant management time.

Some of our competitors

may be able to sustain the costs of such litigation more effectively than we can because of their substantially greater financial resources.

Litigation may also absorb significant management time.

Unpatented trade secrets, improvements, confidential

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or other proceedings, it could consume a substantial portion of our financial resources and the efforts of our personnel.

Our ability to protect and enforce any patents

we may obtain does not guaranty that we will secure the right to commercialize such patents.

Our ability to protect and enforce any

patents we may obtain does not guaranty that we will secure the right to commercialize such patents.

A patent is a limited monopoly right conferred

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is of limited duration but, while in force, allows the patent holder to prevent others from making and/or using his invention.

patent gives the holder this right to exclude others, it is not a license to commercialize the invention, where other permissions may

a patent gives the holder this right to exclude others, it is not a license to commercialize the invention, where other permissions may

be required for permissible commercialization to occur.

For example, a drug cannot be marketed without the appropriate authorization from

the FDA, regardless of the existence of a patent covering the product.

Further, the invention, even if patented itself, cannot be commercialized

if it infringes the valid patent rights of another party.

For example, a drug cannot be marketed without the appropriate authorization

from the FDA, regardless of the existence of a patent covering the product.

Further, the invention, even if patented itself, cannot be

commercialized if it infringes the valid patent rights of another party.

We rely on confidentiality agreements to

protect our trade secrets.

If these agreements are breached by our employees or other parties, our trade secrets may become known to our

If these agreements are breached by our employees or other parties, our trade secrets may become known to

our competitors.

We rely on trade secrets which we seek to protect

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may also dilute current shareholders’ ownership interests in our Company.

Our business strategy includes expanding our products

and capabilities, and we may seek acquisitions of additional drug candidates or technologies to do so.

Acquisitions involve numerous risks,

including substantial cash expenditures;

Our business strategy includes expanding our

products and capabilities, and we may seek acquisitions of additional drug candidates or technologies to do so.

Acquisitions involve

numerous risks, including substantial cash expenditures;

potentially dilutive issuance of equity securities;

incurrence of debt and contingent liabilities,

some of which may be difficult or impossible to identify at the time of acquisition;

difficulties in assimilating the acquired technologies

or the operations of the acquired companies;

incurrence of debt and contingent

liabilities, some of which may be difficult or impossible to identify at the time of acquisition;

difficulties in assimilating the acquired

technologies or the operations of the acquired companies;

diverting our management’s attention away from other business concerns;

risks of entering

markets in which we have limited or no direct experience;

and the potential loss of our key employees or key employees of the acquired

risks of entering markets in which we have limited or no direct experience;

and the potential loss of our key employees or key employees

of the acquired companies.

We cannot assure you that any acquisition will

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We may misjudge the value or worth of an acquired product, company or business.

our future success would depend in part on our ability to manage the rapid growth associated with acquisitions.

We cannot assure you that

we will be able to make the combination of our business with that of acquired products, businesses or companies work or be successful.

addition, our future success would depend in part on our ability to manage the rapid growth associated with acquisitions.

We cannot assure

you that we will be able to make the combination of our business with that of acquired products, businesses or companies work or be successful.

Furthermore, the development or expansion of our business or any acquired products, business or companies may require a substantial capital

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development and registration efforts.

We may not be successful in hiring and retaining

key employees, including executive officers.

We may not be successful in hiring and

retaining key employees, including executive officers.

Our future operations and successes depend in

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We rely heavily on the continued service of each member of our management team.

if any member of our management team were to terminate their employment with us, such departure may have a material adverse effect on

our business.

In addition, our future success depends on our ability to identify, attract, hire or engage, retain and motivate other well-qualified

financial, managerial, technical, clinical and regulatory personnel.

There can be no assurance that these professionals will be available

in the market, or that we will be able to retain existing professionals or to meet or to continue to meet their compensation requirements.

Furthermore, the cost base in relation to such compensation, which may include equity compensation, may increase significantly, which

could have a material adverse effect on us.

Failure to establish and maintain an effective management team and work force could adversely

affect our ability to operate, grow and manage our business.

Accordingly, if any member of our management team were to terminate their employment with us, such departure may have a material adverse

effect on our business.

In addition, our future success depends on our ability to identify, attract, hire or engage, retain and motivate

other well-qualified financial, managerial, technical, clinical and regulatory personnel.

There can be no assurance that these professionals

will be available in the market, or that we will be able to retain existing professionals or to meet or to continue to meet their compensation

requirements.

Furthermore, the cost base in relation to such compensation, which may include equity compensation, may increase significantly,

which could have a material adverse effect on us.

Failure to establish and maintain an effective management team and work force could

adversely affect our ability to operate, grow and manage our business.

Managing our growth as we expand operations

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and expand our operational and financial management capabilities.

Moreover, we will need to increase staffing and to train, motivate and

manage our employees.

All of these activities will increase our expenses and may require us to raise additional capital sooner than expected.

Moreover, we will need to increase staffing and to train, motivate

and manage our employees.

All of these activities will increase our expenses and may require us to raise additional capital sooner than

Failure to manage growth effectively could harm our business, financial condition or results of operations.

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us against potential losses.

In the event a product liability claim is brought against us, we may be required to pay legal and other expenses

to defend the claim, as well as uncovered damage awards resulting from a claim brought successfully against us.

In the event our product

candidate is approved for sale by the FDA or other regulatory agency and commercialized, we may need to substantially increase the amount

of our product liability coverage.

Defending any product liability claim or claims could require us to expend significant financial and

managerial resources, which could have an adverse effect on our business.

Our business may be adversely affected by health epidemics such

as the coronavirus pandemic.

The outbreak of the novel Coronavirus (“COVID-19”)

evolved into a global pandemic and spread to many regions of the world.

The extent to which the coronavirus impacts our business and operating

results may continue to depend on future developments that are uncertain and cannot be accurately predicted, including new information

that may emerge concerning the coronavirus, including variants, and the actions to contain the coronavirus or treat its impact, among

For example, staffing issues related to a health

epidemic such as COVID-19 may disrupt our business operations ,including our clinical trials.

Site initiation, participant recruitment

and enrollment, participant dosing, distribution of clinical trial materials, study monitoring and data analysis may be paused or delayed

due to changes in hospital or university policies, federal, state or local regulations, prioritization of hospital resources toward other

efforts, or other staffing issues related to any such health epidemic.

Also, some participants and clinical investigators may not be able

to comply with clinical trial protocols.

For example, quarantines or other travel limitations (whether voluntary or required) stemming

from a health epidemic may impede participant movement, affect sponsor access to study sites, or interrupt healthcare services, and we

may be unable to conduct our clinical trials.

In addition, if any third parties in the supply chain for materials used in the production

of our product candidates are adversely impacted by a health epidemic such as COVID-19, our supply chain may be disrupted, limiting our

ability to manufacture our product candidates for our clinical trials and research and development operations.

Furthermore, we may be

at a risk of delaying, defaulting and/or not performing under existing agreements, which may increase our costs.

These cost increases

may not be fully recoverable or adequately covered by insurance.

Infections and deaths related to a health epidemic may also disrupt the

United States’ healthcare and healthcare regulatory systems which could divert healthcare resources away from, or materially delay

FDA review and/or approval of our product candidates.

The spread of the coronavirus, which caused a

broad impact globally, may have a material economic effect on our business.

While the potential economic impact brought by the pandemic

may be difficult to assess or predict, it has already caused, and is likely to result in further, significant disruption of global financial

markets, which may reduce our ability to access capital either at all or on favorable terms.

In addition, a recession, depression or other

sustained adverse market event resulting from COVID-19 could materially and adversely affect our business and the value of our common

The ultimate impact of the current pandemic, or

any other health epidemic, is highly uncertain and subject to change.

We do not yet know the full extent of potential delays or impacts

on our business, our clinical trials, our research programs, healthcare systems or the global economy as a whole.

However, these effects

could have a material impact on our operations.

In the event a product liability claim is brought against us, we may be required to pay legal and other

expenses to defend the claim, as well as uncovered damage awards resulting from a claim brought successfully against us.

our product candidate is approved for sale by the FDA or other regulatory agency and commercialized, we may need to substantially increase

the amount of our product liability coverage.

Defending any product liability claim or claims could require us to expend significant

financial and managerial resources, which could have an adverse effect on our business.

Our business may be adversely affected

by public health crises, such as pandemics and epidemics, including the COVID-19 pandemic, which may have a material adverse effect on

our business.

The nature and extent of future impacts are highly uncertain and unpredictable.

We are subject to risks associated with public

health crises, such as pandemics and epidemics, including the COVID-19 pandemic.

While many countries around the world have removed or

reduced the restrictions taken in response to the COVID-19 pandemic, the emergence of new variants of COVID-19 virus could result in

new governmental lockdowns, quarantine requirements or other restrictions to slow the spread of the virus.

In addition, any such measures

could also impact the global economy more broadly, for example by leading to further economic slowdowns.

While COVID-19 case volumes

have decreased in the U.S and certain other countries, the global outlook remains uncertain as case counts fluctuate and vaccination

and booster rates remain relatively low in many parts of the world.

If we were to experience shutdowns or other significant business

disruptions, our ability to conduct our business in the manner presently planned could be materially and negatively impacted.

For example, staffing issues related to a public

health crises may disrupt our business operations, including our clinical trials.

Site initiation, participant recruitment and enrollment,

participant dosing, distribution of clinical trial materials, study monitoring and data analysis may be paused or delayed due to changes

in hospital or university policies, federal, state or local regulations, prioritization of hospital resources toward other efforts, or

other staffing issues related to any such health epidemic.

Also, some participants and clinical investigators may not be able to comply

with clinical trial protocols.

For example, quarantines or other travel limitations (whether voluntary or required) stemming from a health

epidemic may impede participant movement, affect sponsor access to study sites, or interrupt healthcare services, and we may be unable

to conduct our clinical trials.

In addition, if any third parties in the supply chain for materials used in the production of our product

candidates are adversely impacted by a public health crises, our supply chain may be disrupted, limiting our ability to manufacture our

product candidates for our clinical trials and research and development operations.

Furthermore, we may be at a risk of delaying, defaulting

and/or not performing under existing agreements, which may increase our costs.

These cost increases may not be fully recoverable or adequately

covered by insurance.

Infections and deaths related to a health epidemic may also disrupt the United States’ healthcare and healthcare

regulatory systems which could divert healthcare resources away from, or materially delay FDA review and/or approval of our product candidates.

The scope and duration of any future public health

crisis, including the potential emergence of new variants of the COVID-19 virus, the pace at which government restrictions are imposed

and lifted, global vaccination and booster rates, the speed and extent to which global markets fully recover from the disruptions caused

by such public health crisis, and the impact of these factors on our business, financial condition and results of operations, will depend

on future developments that are highly uncertain and cannot be predicted with confidence.

Significant disruptions

of information technology systems or breaches of data security could adversely affect our business.

Our business is increasingly dependent on critical,

complex, and interdependent information technology systems, including Internet-based systems, to support business processes as well as

internal and external communications.

These systems are also critical to enable remote working arrangements, which have been growing

in importance.

The size and complexity of our computer systems make us potentially vulnerable to IT system breakdowns, internal and external

malicious intrusion, and computer viruses and ransomware, which may impact product production and key business processes.

outsourced significant elements of our information technology infrastructure and operations to third parties, which may allow them to

access our confidential information and may also make our systems vulnerable to service interruptions or to security breaches from inadvertent

or intentional actions by such third parties or others.

In addition, our systems are potentially vulnerable

to data security breaches - whether by employees or others - which may expose sensitive data to unauthorized persons.

Data security breaches

could lead to the loss of trade secrets or other intellectual property, result in demands for ransom or other forms of blackmail, or

lead to the public exposure of personal information (including sensitive personal information) of our employees, clinical trial patients,

customers, and others.

Such attacks are of ever-increasing levels of sophistication and are made by groups and individuals with a wide

range of motives (including industrial espionage or extortion) and expertise, including by organized criminal groups, “hacktivists,”

nation states, and others.

As a company with an increasingly global presence, our systems are subject to frequent attacks.

potential that our systems may be directly or indirectly affected as nation-states conduct global cyberwarfare, including in connection

with the current Russia-Ukraine or Hamas-Israel armed conflict.

Due to the nature of some of these attacks, there

is a risk that an attack may remain undetected for a period of time.

While we continue to make investments to improve the protection

of data and information technology, and to oversee and monitor the security measures of our suppliers and/or service providers, there

can be no assurance that our efforts will prevent service interruptions or security breaches.

In addition, we depend in part on third-party

security measures over which we do not have full control to protect against data security breaches.

If we or our suppliers and/or service providers

fail to maintain or protect our information technology systems and data security effectively and in compliance with U.S.

laws, or fail to anticipate, plan for, or manage significant disruptions to these systems, we or our suppliers and/or service providers

could have difficulty preventing, detecting, or controlling such disruptions or security breaches, which could result in legal proceedings,

liability under U.S.

and foreign laws that protect the privacy of personal information, disruptions to our operations, government investigations,

breach of contract claims, and damage to our reputation (in each case in the U.S.

or globally), which could have a material adverse effect

on our business, prospects, operating results, and financial condition.

Risks Related to Our Common Stock

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risks mentioned in this “Risk Factors” section and elsewhere in this Annual Report on Form 10-K, are:

sale of our common stock by our shareholders, executives, and directors;

volatility and limitations in trading volumes of our shares of common stock;

our ability to obtain financings to conduct and complete research and development activities including, but not limited to, our clinical trials, and other business activities;

the timing and success of introductions of new products by us or our competitors or any other change in the competitive dynamics of our industry, including consolidation among competitors;

our ability to attract new customers;

our ability to secure resources and the necessary personnel to conduct clinical trials on our desired schedule;

commencement, enrollment or results of our clinical trials for our product candidates;

changes in the development status of our product candidates;

any delays or adverse developments or perceived adverse developments with respect to a regulatory agency’s review of our planned pre-clinical and clinical trials;

any delay in our submission for studies or product approvals or adverse regulatory decisions, including failure to receive regulatory approval for our product candidates;

unanticipated safety concerns related to the use of our product candidates;

changes in our capital structure or dividend policy, future issuances of securities and sales of large blocks of common stock by our shareholders;

sale of our common stock

by our shareholders, executives, and directors;

volatility and limitations

in trading volumes of our shares of common stock;

our ability to obtain financings

to conduct and complete research and development activities including, but not limited to, our clinical trials, and other business

the timing and success

of introductions of new products by us or our competitors or any other change in the competitive dynamics of our industry, including

consolidation among competitors;

our ability to attract

new customers;

our ability to secure resources

and the necessary personnel to conduct clinical trials on our desired schedule;

commencement, enrollment

or results of our clinical trials for our product candidates;

changes in the development

status of our product candidates;

any delays or adverse developments

or perceived adverse developments with respect to a regulatory agency’s review of our planned pre-clinical and clinical trials;

any delay in our submission

for studies or product approvals or adverse regulatory decisions, including failure to receive regulatory approval for our product

unanticipated safety concerns

related to the use of our product candidates;

changes in our capital

structure or dividend policy, future issuances of securities and sales of large blocks of common stock by our shareholders;

our cash position;

announcements and events surrounding financing efforts, including debt and equity securities;

our inability to enter into new markets or develop new products;

announcements and events

surrounding financing efforts, including debt and equity securities;

our inability to enter

into new markets or develop new products;

reputational issues;

announcements of acquisitions, partnerships, collaborations, joint ventures, new products, capital commitments, or other events by us or our competitors;

changes in general economic, political and market conditions in or any of the regions in which we conduct our business;

changes in industry conditions or perceptions;

analyst research reports, recommendation and changes in recommendations, price targets, and withdrawals of coverage;

departures and additions of key personnel;

disputes and litigations related to intellectual properties, proprietary rights, and contractual obligations;

changes in applicable laws, rules, regulations, or accounting practices and other dynamics;

other events or factors, many of which may be out of our control, including, but not limited to, pandemics such as COVID-19, war, or other acts of God.

In addition, if the market for stocks in our industry

or industries related to our industry, or the stock market in general, experiences a loss of investor confidence, the trading price of

our common stock could decline for reasons unrelated to our business, financial condition and results of operations.

If any of the foregoing

occurs, it could cause our stock price to fall and may expose us to lawsuits that, even if unsuccessful, could be costly to defend and

a distraction to management.

announcements of acquisitions,

partnerships, collaborations, joint ventures, new products, capital commitments, or other events by us or our competitors;

changes in general economic,

political and market conditions in or any of the regions in which we conduct our business;

changes in industry conditions

or perceptions;

analyst research reports,

recommendation and changes in recommendations, price targets, and withdrawals of coverage;

departures and additions

of key personnel;

disputes and litigations

related to intellectual properties, proprietary rights, and contractual obligations;

changes in applicable laws,

rules, regulations, or accounting practices and other dynamics;

other events or factors,

many of which may be out of our control, including, but not limited to, pandemics, war, or other acts of God.

In addition, if the market for stocks in our

industry or industries related to our industry, or the stock market in general, experiences a loss of investor confidence, the trading

price of our common stock could decline for reasons unrelated to our business, financial condition and results of operations.

of the foregoing occurs, it could cause our stock price to fall and may expose us to lawsuits that, even if unsuccessful, could be costly

to defend and a distraction to management.

We may acquire other companies or technologies,

which could divert our management’s attention, result in dilution to our shareholders and otherwise disrupt our operations and adversely

affect our operating results.

which could divert our management’s attention, result in dilution to our shareholders and otherwise disrupt our operations and

adversely affect our operating results.

We may in the future seek to acquire or invest

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benefits from the acquired business due to a number of factors, including:

inability to integrate or benefit from acquired technologies or services in a profitable manner;

unanticipated costs or liabilities associated with the acquisition;

difficulty integrating the accounting systems, operations and personnel of the acquired business;

difficulties and additional expenses associated with supporting legacy products and hosting infrastructure of the acquired business;

difficulty converting the customers of the acquired business onto our platform and contract terms, including disparities in the revenue, licensing, support or professional services model of the acquired company;

diversion of management’s attention from other business concerns;

adverse effects to our existing business relationships with business partners and customers as a result of the acquisition;

the potential loss of key employees;

use of resources that are needed in other parts of our business;

use of substantial portions of our available cash to consummate the acquisition.

inability to integrate

or benefit from acquired technologies or services in a profitable manner;

unanticipated costs or

liabilities associated with the acquisition;

difficulty integrating

the accounting systems, operations and personnel of the acquired business;

difficulties and additional

expenses associated with supporting legacy products and hosting infrastructure of the acquired business;

difficulty converting the

customers of the acquired business onto our platform and contract terms, including disparities in the revenue, licensing, support

or professional services model of the acquired company;

diversion of management’s

attention from other business concerns;

adverse effects to our

existing business relationships with business partners and customers as a result of the acquisition;

the potential loss of key

use of resources that are

needed in other parts of our business;

use of substantial portions

of our available cash to consummate the acquisition.

In addition, a significant portion of the purchase

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results based on this impairment assessment process, which could adversely affect our results of operations.

Acquisitions could also result

in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our operating results.

Acquisitions could also

result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our operating results.

if an acquired business fails to meet our expectations, our operating results, business and financial position may suffer.

Unstable market and economic conditions and adverse developments

with respect to financial institutions and associated liquidity risk may have serious adverse consequences on our business, financial

condition and stock price.

Unstable market and economic conditions

and adverse developments with respect to financial institutions and associated liquidity risk may have serious adverse consequences on

our business, financial condition and stock price.

The global credit and

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the federally insured limit of $250,000.

Any loss incurred or a lack of access to such funds could have a significant adverse impact on

our financial condition, results of operations, and cash flows.

There can be no assurance

that future credit and financial market instability and a deterioration in confidence in economic conditions will not occur.

business strategy may be adversely affected by any such economic downturn, liquidity shortages, volatile business environment or continued

unpredictable and unstable market conditions.

If the equity and credit markets deteriorate, or if adverse developments are experienced

by financial institutions, it may cause short-term liquidity risk and also make any necessary debt or equity financing more difficult,

more costly and more dilutive.

Failure to secure any necessary financing in a timely manner and on favorable terms could have a material

adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon clinical development

In addition, there is a risk that one or more of our financial institutions, manufacturers and other third parties with whom we

engage may be adversely affected by the foregoing risks, which may have a material adverse effect on our business.

Any loss incurred or a lack of access to such funds could have a significant adverse impact

on our financial condition, results of operations, and cash flows.

There can be no assurance that future credit

and financial market instability and a deterioration in confidence in economic conditions will not occur.

Our general business strategy

may be adversely affected by any such economic downturn, liquidity shortages, volatile business environment or continued unpredictable

and unstable market conditions.

If the equity and credit markets deteriorate, or if adverse developments are experienced by financial

institutions, it may cause short-term liquidity risk and also make any necessary debt or equity financing more difficult, more costly

and more dilutive.

Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse

effect on our growth strategy, financial performance and stock price and could require us to delay or abandon clinical development plans.

In addition, there is a risk that one or more of our financial institutions, manufacturers and other third parties with whom we engage

may be adversely affected by the foregoing risks, which may have a material adverse effect on our business.

Future sales and issuances of our securities

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We expect that significant additional capital

will be needed in the future to continue our planned operations, including research and development, increased marketing, hiring new personnel,

commercializing our products, and continuing activities as an operating public company.

To the extent we raise additional capital by issuing

equity securities, our shareholders may experience substantial dilution.

We may sell common stock, convertible securities or other equity

securities in one or more transactions at prices and in a manner we determine from time to time.

If we sell common stock, convertible

securities or other equity securities in more than one transaction, investors may be materially diluted by subsequent sales.

may also result in material dilution to our existing shareholders, and new investors could gain rights superior to our existing shareholders.

We do not intend to pay cash dividends on

our shares of common stock so any returns will be limited to the value of our shares.

will be needed in the future to continue our planned operations, including research and development, increased marketing, hiring new

personnel, commercializing our products, and continuing activities as an operating public company.

To the extent we raise additional

capital by issuing equity securities, our shareholders may experience substantial dilution.

We may sell common stock, convertible securities

or other equity securities in one or more transactions at prices and in a manner we determine from time to time.

If we sell common stock,

convertible securities or other equity securities in more than one transaction, investors may be materially diluted by subsequent sales.

Such sales may also result in material dilution to our existing shareholders, and new investors could gain rights superior to our existing

shareholders.

We do not intend to pay cash dividends

on our shares of common stock so any returns will be limited to the value of our shares.

We have never paid or declared any cash dividends

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We are an “emerging growth company”

and will be able to avail ourselves of reduced disclosure requirements applicable to emerging growth companies, which could make our common

stock less attractive to investors.

and will be able to avail ourselves of reduced disclosure requirements applicable to emerging growth companies, which could make our

common stock less attractive to investors.

We are an “emerging growth company,”

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In addition, pursuant to Section 107 of the JOBS Act, as an “emerging

growth company” we intend to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act,

for complying with new or revised accounting standards.

growth company” we intend to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities

Act, for complying with new or revised accounting standards.

In other words, an “emerging growth company” can delay the adoption

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We may be at risk of securities class action litigation.

In the past, biotechnology and pharmaceutical companies have experienced significant stock price volatility, particularly when associated

with binary events such as clinical trials and product approvals.

If we face such litigation, it could result in substantial costs and

a diversion of management’s attention and resources, which could harm our business and results in a decline in the market price

of our common stock.

We may be at risk of securities class action

In the past, biotechnology and pharmaceutical companies have experienced significant stock price volatility, particularly

when associated with binary events such as clinical trials and product approvals.

If we face such litigation, it could result in substantial

costs and a diversion of management’s attention and resources, which could harm our business and results in a decline in the market

price of our common stock.

We are currently

listed on The Nasdaq Capital Market.

If we are unable to maintain listing of our securities on Nasdaq or any stock exchange, our stock

price could be adversely affected and the liquidity of our stock and our ability to obtain financing could be impaired and it may be more

difficult for our shareholders to sell their securities.

Although our common stock

is currently listed on The Nasdaq Capital Market, we may not be able to continue to meet the exchange’s minimum listing requirements

or those of any other national exchange.

The Listing Rules of Nasdaq require listing issuers to comply with certain standards in order

to remain listed on its exchange.

If, for any reason, we should fail to maintain compliance with these listing standards and Nasdaq should

delist our securities from trading on its exchange and we are unable to obtain listing on another national securities exchange, a reduction

listed on The Nasdaq Capital Market (“Nasdaq”).

If we are unable to maintain listing of our securities on Nasdaq or any stock

exchange, our stock price could be adversely affected and the liquidity of our stock and our ability to obtain financing could be impaired

and it may be more difficult for our shareholders to sell their securities.

Although our common

stock is currently listed on Nasdaq, we may not be able to continue to meet the exchange’s minimum listing requirements or those

of any other national exchange.

The Listing Rules of Nasdaq require listing issuers to comply with certain standards in order to remain

listed on its exchange.

If, for any reason, we should fail to maintain compliance with these listing standards and Nasdaq should delist

our securities from trading on its exchange and we are unable to obtain listing on another national securities exchange, a reduction

in some or all of the following may occur, each of which could have a material adverse effect on our shareholders:

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the market price of our common stock;

our ability to obtain financing for the continuation of our operations;

the number of investors that will consider investing in our common stock;

our ability to obtain financing for the continuation

of our operations;

the number of investors that will consider investing

in our common stock;

the number of market makers in our common stock;

the availability of information concerning the trading prices and volume of our common stock;

the number of broker-dealers willing to execute trades in shares of our common stock.

the availability of information concerning the trading

prices and volume of our common stock;

the number of broker-dealers willing to execute trades

in shares of our common stock.

Our Articles of Incorporation, as amended

(“Articles of Incorporation”), our Amended and Restated Bylaws, and Nevada law may have anti-takeover effects that could discourage,

delay or prevent a change in control, which may cause our stock price to decline.

(“Articles of Incorporation”), our Amended and Restated Bylaws, and Nevada law may have anti-takeover effects that could

discourage, delay or prevent a change in control, which may cause our stock price to decline.

Our Articles of Incorporation, Amended and Restated

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and thereby preserve control by the present management.

Provisions of our Articles of Incorporation, our

Amended and Restated Bylaws and Nevada law also could have the effect of discouraging potential acquisition proposals or making a tender

offer or delaying or preventing a change in control, including changes a shareholder might consider favorable.

Such provisions may also

prevent or frustrate attempts by our shareholders to replace or remove our management.

In particular, the Articles of Incorporation, our

Amended and Restated Bylaws and Nevada law, as applicable, among other things:

provide the board of directors with the ability to alter the Amended and Restated Bylaws without shareholder approval;

place limitations on the removal of directors;

establish advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted upon at shareholder meetings;

provide that vacancies on the board of directors may be filled by a majority of directors in office, although less than a quorum.

Provisions of our Articles of Incorporation,

our Amended and Restated Bylaws and Nevada law also could have the effect of discouraging potential acquisition proposals or making a

tender offer or delaying or preventing a change in control, including changes a shareholder might consider favorable.

Such provisions

may also prevent or frustrate attempts by our shareholders to replace or remove our management.

In particular, the Articles of Incorporation,

our Amended and Restated Bylaws and Nevada law, as applicable, among other things:

provide the board of directors

with the ability to alter the Amended and Restated Bylaws without shareholder approval;

place limitations on the

removal of directors;

establish advance notice

requirements for nominations for election to the board of directors or for proposing matters that can be acted upon at shareholder

provide that vacancies

on the board of directors may be filled by a majority of directors in office, although less than a quorum.

Our Amended and Restated Bylaws provide

that the Eighth Judicial District Court of Clark County, Nevada will be the sole and exclusive forum for certain disputes which could

limit shareholders’ ability to obtain a favorable judicial forum for disputes with us or its directors, officers, employees or agents.

Our Amended and Restated Bylaws provide that unless

we consent in writing to the selection of an alternative forum, the Eighth Judicial District Court of Clark County, Nevada shall be the

sole and exclusive forum for state law claims with respect to:

(i) any derivative action or proceeding brought in the name or right of

us or on our behalf, (ii) any action asserting a claim for breach of any fiduciary duty owed by any director, officer, employee or agent

to us or our shareholders, (iii) any action arising or asserting a claim arising pursuant to any provision of Nevada Revised Statutes

Chapters 78 or 92A or any provision of our Articles of Incorporation or Amended and Restated Bylaws or (iv) any action asserting a claim

governed by the internal affairs doctrine, including, without limitation, any action to interpret, apply, enforce or determine the validity

of our Articles of Incorporation or Amended and Restated Bylaws.

This exclusive forum provision would not apply to suits brought to enforce

any liability or duty created by the Securities Act or the Exchange Act or any other claim for which the federal courts have exclusive

jurisdiction.

To the extent that any such claims may be based upon federal law claims, Section 27 of the Exchange Act creates exclusive

federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations

Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits

brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.

limit shareholders’ ability to obtain a favorable judicial forum for disputes with us or its directors, officers, employees or

Our Amended and Restated Bylaws provide that

unless we consent in writing to the selection of an alternative forum, the Eighth Judicial District Court of Clark County, Nevada shall

be the sole and exclusive forum for state law claims with respect to:

(i) any derivative action or proceeding brought in the name or

right of us or on our behalf, (ii) any action asserting a claim for breach of any fiduciary duty owed by any director, officer, employee

or agent to us or our shareholders, (iii) any action arising or asserting a claim arising pursuant to any provision of Nevada Revised

Statutes Chapters 78 or 92A or any provision of our Articles of Incorporation or Amended and Restated Bylaws or (iv) any action asserting

a claim governed by the internal affairs doctrine, including, without limitation, any action to interpret, apply, enforce or determine

the validity of our Articles of Incorporation or Amended and Restated Bylaws.

This exclusive forum provision would not apply to suits

brought to enforce any liability or duty created by the Securities Act or the Exchange Act or any other claim for which the federal courts

have exclusive jurisdiction.

To the extent that any such claims may be based upon federal law claims, Section 27 of the Exchange Act

creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules

and regulations thereunder.

Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts

over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.

This choice of forum provision may limit a shareholder’s

8 unchanged sentences

publish research or reports, or publish unfavorable research or reports about our business, our stock price and trading volume may decline.

The trading market for our common stock will rely

in part on the research and reports that industry or financial analysts publish about us, our business, our markets and our competitors.

The trading market for our common stock will

rely in part on the research and reports that industry or financial analysts publish about us, our business, our markets and our competitors.

We do not control these analysts.

14 unchanged sentences

and places significant demands on our management and other personnel, including costs resulting from public company reporting obligations

under the Exchange Act and the rules and regulations regarding corporate governance practices, including those under Sarbanes-Oxley, the

Dodd-Frank Wall Street Reform and Consumer Protection Act, and the listing requirements of The Nasdaq Capital Market.

These rules require

the establishment and maintenance of effective disclosure and financial controls and procedures, internal control over financial reporting

and changes in corporate governance practices, among many other complex rules that are often difficult to implement, monitor and maintain

compliance with.

Moreover, despite recent reforms made possible by the JOBS Act, the reporting requirements, rules, and regulations will

make some activities more time-consuming and costly, particularly after we are no longer an “emerging growth company.” Our

management and other personnel will need to devote a substantial amount of time to ensure that we comply with all of these requirements

and to keep pace with new regulations, otherwise we may fall out of compliance and risk becoming subject to litigation or being delisted,

among other potential problems.

to maintain effective internal controls could cause our investors to lose confidence in us and adversely affect the market price of our

common stock.

If our internal controls are not effective, we may not be able to accurately report our financial results or prevent fraud.

under the Exchange Act and the rules and regulations regarding corporate governance practices, including those under Sarbanes-Oxley,

the Dodd-Frank Wall Street Reform and Consumer Protection Act, and the listing requirements of Nasdaq.

These rules require the establishment

and maintenance of effective disclosure and financial controls and procedures, internal control over financial reporting and changes

in corporate governance practices, among many other complex rules that are often difficult to implement, monitor and maintain compliance

Moreover, despite recent reforms made possible by the JOBS Act, the reporting requirements, rules, and regulations will make some

activities more time-consuming and costly, particularly after we are no longer an “emerging growth company.” Our management

and other personnel will need to devote a substantial amount of time to ensure that we comply with all of these requirements and to keep

pace with new regulations, otherwise we may fall out of compliance and risk becoming subject to litigation or being delisted, among other

potential problems.

Failure to maintain effective internal

controls could cause our investors to lose confidence in us and adversely affect the market price of our common stock.

If our internal

controls are not effective, we may not be able to accurately report our financial results or prevent fraud.

Section 404 of Sarbanes-Oxley requires annual

management assessments of the effectiveness of our internal controls over financial reporting.

internal control over financial reporting is necessary for us to provide reliable financial reports in a timely manner.

In connection

with the audit of our financial statements for the year ended December 31, 2022, our independent registered public accounting firm identified

a material weakness.

A material weakness is a significant deficiency, or a combination of significant deficiencies, in internal controls

over financial reporting such that it is reasonably possible that a material misstatement of the annual or interim financial statements

will not be prevented or detected on a timely basis.

The material weakness that has been identified by our independent registered public

accounting firm relates to the lack of sufficient resources necessary to provide adequate segregation of duties related to the

preparation and review of financial information used in financial reporting and review of controls over the financial reporting process,

including cutoff related to accruals and prepaids.

While we intend to take steps to remediate the

material weakness in our internal control over financial reporting by updating and expanding our accounts payable tracking and booking,

we may not be successful in remediating such weakness in a timely manner, if at all, which may undermine our ability to provide accurate,

timely and reliable reports on our financial and operating results.

Furthermore, if we remediate our current material weakness but identify

new material weaknesses in our internal control over financial reporting in the future, investors may lose confidence in the accuracy

and completeness of our financial reports and the market price of our common stock may be negatively affected.

As a result of such failures,

we could also become subject to investigations by Nasdaq, the SEC, or other regulatory authorities, and become subject to litigation from

investors and shareholders, which could harm our reputation, financial condition or divert financial and management resources from our

UNRESOLVED STAFF COMMENTS

Not applicable.

If we fail to comply with the rules under

Sarbanes-Oxley related to disclosure controls and procedures in the future, or, if we discover material weaknesses and other deficiencies

in our internal controls over financial reporting, our stock price could decline significantly and raising capital could be more difficult.

If material weaknesses or significant deficiencies are discovered or if we otherwise fail to achieve and maintain the adequacy of our

internal controls, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over

financial reporting in accordance with Section 404 of Sarbanes-Oxley.

Moreover, effective internal controls are necessary for us to produce

reliable financial reports and are important to helping prevent financial fraud.

If we cannot provide reliable financial reports or prevent

fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and

the trading price of our common stock could drop significantly.

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