What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2024-03-19 compared with 2023-03-23 · 473 added, 487 removed, 936 unchanged (51% of the section changed)

15 unchanged sentences

Risks related to our business

Business risks include risks associated with our

products and regulatory approval, licensing agreements, historical losses, managing growth, acquisitions, the COVID-19 pandemic, and

Russia’s Invasion of Ukraine.

In general, the risks related to our business can cause variability in the future profits of the

Risks related to clinical and regulatory matters

Clinical and regulatory matters include risks associated

with clinical trials and the future ability to commercially market the product.

Business risks include risks associated with

our products and regulatory approval, licensing agreements, historical losses, managing growth, and acquisitions.

In general, the risks

related to our business can cause variability in the future profits of the Company.

Risks related to clinical and regulatory

Clinical and regulatory matters include risks

associated with clinical trials and the future ability to commercially market the product.

In order for any of our products to be commercialized

2 unchanged sentences

the trial will significantly increase our cost of doing business.

In addition, the active ingredient in our products is a controlled

substance which can affect the supply available for clinical trials, as well as commercial sales.

A limited supply could increase the

time needed to complete clinical trials and overall costs including product liability claims.

We could also face potential fines or reputational

risk if we do not comply.

Developments from competitors and the ability to obtain market exclusivity could also negatively impact future

In addition, the active ingredient in our products is a controlled substance

which can affect the supply available for clinical trials, as well as commercial sales.

A limited supply could increase the time needed

to complete clinical trials and overall costs including product liability claims.

We could also face potential fines or reputational risk

if we do not comply.

Developments from competitors and the ability to obtain market exclusivity could also negatively impact future profits.

Risks related to our intellectual property

3 unchanged sentences

Infringing upon

patents or trade secrets could force us to cease or alter our product development efforts or obtain a license to continue to develop

or sale our products.

patents or trade secrets could force us to cease or alter our product development efforts or obtain a license to continue to develop or

sale our products.

These risks could not only impact the future profits of the company but also create adverse publicity for us.

Risks related to government regulations

We are required to comply with various federal and

state pharmaceutical and healthcare laws and regulations, and to maintain secure systems to protect sensitive confidential information.

We are required to comply with various federal

and state pharmaceutical and healthcare laws and regulations, and to maintain secure systems to protect sensitive confidential information.

Complying with the various regulations can increase our cost of doing business.

3 unchanged sentences

Risks related to our reliance on third parties

The Company relies on third parties to conduct preclinical

and clinical studies, as well as to manufacture our product candidates.

Third parties’ failure to perform the trials as contractually

required could impact our ability to obtain regulatory approval.

If our third-party manufacturers fail to meet our requirements and strict

regulatory requirements, our product development and commercialization efforts may be materially harmed.

Risks related to ownership of our common stock

The Company relies on third parties to conduct

preclinical and clinical studies, as well as to manufacture our product candidates.

Third parties’ failure to perform the trials

as contractually required could impact our ability to obtain regulatory approval.

If our third-party manufacturers fail to meet our requirements

and strict regulatory requirements, our product development and commercialization efforts may be materially harmed.

Risks related to ownership of our common

Common stocks risks include risks associated with

5 unchanged sentences

Risks Related to Our Business

Our business depends on the success of

esmethadone (d-methadone, dextromethadone, REL-1017), our only product candidate currently in clinical development, which is in a

pivotal clinical trials for the adjunctive treatment of MDD.

If we are unable to obtain regulatory approval for and successfully

commercialize REL-1017 or other future product candidates, or we experience significant delays in doing so, our business will be

materially harmed.

To date, the primary focus of our product development has been esmethadone

(d-methadone, dextromethadone, REL-1017) for the adjunctive and monotherapy treatment of patients with MDD.

Currently, esmethadone is

our only product candidate under clinical development.

This may make an investment in our Company riskier than similar companies that

have multiple product candidates in active development and that therefore may be able to better sustain a setback of a lead candidate.

Successful continued development and ultimate regulatory approval of esmethadone for the adjunctive treatment of MDD, and potentially

as a monotherapy for MDD, or other indications is critical to the future success of our business.

We have invested, and will continue

to invest, a significant portion of our time and financial resources in the clinical development of esmethadone.

If we cannot successfully

develop, obtain regulatory approval for and commercialize esmethadone, we may not be able to continue our operations.

The future regulatory

and commercial success of esmethadone is subject to a number of risks, including the following:

Our business depends on the success of esmethadone

(d-methadone, dextromethadone, REL-1017), our only product candidate currently in clinical development, which is in a pivotal clinical

trial for the adjunctive treatment of MDD.

If we are unable to obtain regulatory approval for and successfully commercialize REL-1017

or other future product candidates, or we experience significant delays in doing so, our business will be materially harmed.

To date, the primary focus of our product development

has been esmethadone (d-methadone, dextromethadone, REL-1017) for the adjunctive treatment of patients with MDD.

Currently, esmethadone

is our only product candidate under clinical development.

We intend, in 2024, to enter human studies of our proprietary, low dose modified-release

formulation of psilocybin (REL-P11) for metabolic indications, but there can be no assurance that such studies will be commenced or completed.

This may make an investment in our Company riskier than similar companies that have multiple product candidates in active development

and that therefore may be able to better sustain a setback of a lead candidate.

Successful continued development and ultimate regulatory

approval of esmethadone for the adjunctive treatment of MDD or other indications is critical to the future success of our business.

have invested, and will continue to invest, a significant portion of our time and financial resources in the clinical development of esmethadone.

If we cannot successfully develop, obtain regulatory approval for and commercialize esmethadone, we may not be able to continue our operations.

The future regulatory and commercial success of esmethadone is subject to a number of risks, including the following:

we may not be able to obtain adequate evidence from clinical trials

to support the efficacy and safety for esmethadone for the adjunctive treatment of MDD, monotherapy for MDD, or other indications;

to support the efficacy and safety for esmethadone for the adjunctive treatment of MDD or other indications;

we may not be able to demonstrate that the benefits of esmethadone

for the adjunctive treatment of MDD, monotherapy for MDD, or other indications outweigh the risks;

in our clinical trials

for esmethadone, enrollment may be slower than anticipated and we may need additional clinical trial sites than originally planned,

which could delay our clinical trial progress;

the results of our clinical

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

for marketing approval;

patients in our clinical

trials may suffer serious adverse effects for reasons that may or may not be related to esmethadone, which could delay or prevent

further clinical development;

for the adjunctive treatment of MDD or other indications outweigh the risks;

in our clinical trials for esmethadone, enrollment may be slower than anticipated and we may need additional clinical trial sites than originally planned, which could delay our clinical trial progress;

the results of our clinical trials may not meet the level of statistical or clinical significance required by the FDA or comparable foreign regulatory authorities for marketing approval;

patients in our clinical trials may suffer serious adverse effects for reasons that may or may not be related to esmethadone, which could delay or prevent further clinical development;

the standards implemented by clinical or regulatory agencies may change

at any time and we cannot be certain what efficacy endpoints the FDA or foreign clinical or regulatory agencies may require in pivotal

clinical trials with respect to the adjunctive treatment of MDD, monotherapy for MDD, or any other indication for the approval of esmethadone;

the results of later stage

clinical trials may not be as favorable as the results we have observed to date in our preclinical studies and Phase 1 and 2 clinical

clinical trials with respect to the adjunctive treatment of MDD or any other indication for the approval of esmethadone;

the results of later stage clinical trials may not be as favorable as the results we have observed to date in our preclinical studies and Phase 1 and 2 clinical trials;

we cannot be certain of the number and type of clinical trials and

preclinical or toxicology studies that the FDA or other regulatory agencies will require in order to approve esmethadone for the adjunctive

treatment of MDD, monotherapy for MDD, or any other indication;

we may not have sufficient

financial and other resources to complete the necessary clinical trials for esmethadone, including, but not limited to, the clinical

trials needed to obtain drug approval;

if approved for the adjunctive treatment of MDD, monotherapy for MDD,

esmethadone will likely compete with products that may reach approval prior to esmethadone, products that are currently approved for the

adjunctive treatment of MDD, monotherapy for MDD, and the off-label use of currently marketed products for MDD;

we may not be able to obtain,

maintain or enforce our patents and other intellectual property rights.

Esmethadone and any future product candidates

will be subject to rigorous and extensive clinical trials and extensive regulatory approval processes implemented by the FDA and comparable

foreign regulatory authorities before obtaining marketing approval from these regulatory authorities, if at all.

The drug development

and approval process is lengthy and expensive, and approval is never certain.

Investigational new drugs, such as esmethadone, may not

prove to be safe and effective in clinical trials.

We have limited experience as a company in conducting later stage clinical trials required

to obtain regulatory approval.

We may be unable to conduct future clinical trials at preferred sites, enlist clinical investigators, enroll

sufficient numbers of participants or begin or successfully complete clinical trials in a timely fashion, if at all.

In addition, the

design of a clinical trial can determine whether its results will support approval of a product, and flaws in the design of a clinical

trial may not become apparent until the clinical trial is well advanced.

Because we have limited experience as a company designing clinical

trials, we may be unable to design and execute clinical trials to support regulatory approval.

treatment of MDD or any other indication;

we may not have sufficient financial and other resources to complete the necessary clinical trials for esmethadone, including, but not limited to, the clinical trials needed to obtain drug approval;

if approved for the adjunctive treatment of MDD, esmethadone will likely

compete with products that may reach approval prior to esmethadone, products that are currently approved for the adjunctive treatment

of MDD and the off-label use of currently marketed products for MDD;

we may not be able to obtain, maintain or enforce our patents and other intellectual property rights.

Esmethadone, psilocybin and any future product

candidates will be subject to rigorous and extensive clinical trials and extensive regulatory approval processes implemented by the FDA

and comparable foreign regulatory authorities before obtaining marketing approval, if at all, from these regulatory authorities.

development and approval process is lengthy and expensive, and approval is never certain.

Investigational new drugs, such as esmethadone,

may not prove to be safe and effective in clinical trials.

We have limited experience as a company in conducting later stage clinical

trials required to obtain regulatory approval.

We may be unable, if at all, to conduct future clinical trials at preferred sites, enlist

clinical investigators, enroll sufficient numbers of participants or begin or successfully complete clinical trials in a timely fashion.

In addition, the design of a clinical trial can determine whether its results will support approval of a product, and flaws in the design

of a clinical trial may not become apparent until the clinical trial is well advanced.

Because we have limited experience as a company

designing clinical trials, we may be unable to design and execute clinical trials to support regulatory approval.

There is a high failure rate for drugs and biological

2 unchanged sentences

The results of preclinical

studies and early clinical trials of esmethadone or any future product candidate may not be predictive of the results of later-stage clinical

studies or trials and the results of studies or trials in one set of patients or line of treatment may not be predictive of those obtained

In fact, many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in late stage

clinical trials even after achieving promising results in preclinical studies and earlier stage clinical trials.

In addition, data obtained

from preclinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory approval.

Owing in part to the complexity of biological pathways, esmethadone or any future product candidate may not demonstrate in patients the

biochemical and pharmacological properties we anticipate based on laboratory studies or earlier stage clinical trials, and they may interact

with human biological systems or other drugs in unforeseen, ineffective or harmful ways.

The number of patients exposed to product candidates

and the average exposure time in the clinical development programs may be inadequate to detect rare adverse events or findings that may

only be detected once a product candidate is administered to more patients and for greater periods of time.

Our Phase 2 clinical study

of REL-1017 involved a small population of subjects with MDD, and, because of the small sample size in such trial, the results of this

clinical trial may be subject to substantial variability and may not be indicative of either future top-line results or final results.

On October 13, 2022, we announced that the RELIANCE III study, evaluating REL-1017 in the monotherapy setting for MDD, did not achieve

its primary endpoint, which was a statistically significant improvement in depression symptoms compared to placebo as measured by the

MADRS on Day 28.

On December 7, 2022, we announced that the RELIANCE I study did not achieve its primary endpoint, which was a statistically

significant improvement in depression symptoms compared to placebo as measured by the MADRS on Day 28.

With these findings, even if RELIANCE

II or additional Phase III studies achieve their primary endpoints, we may not have sufficient evidence to demonstrate the efficacy of

REL-1017 as an adjunctive treatment of MDD.

If we are unable to successfully demonstrate the safety and efficacy of esmethadone or other

future product candidates and receive the necessary regulatory approvals, our business will be materially harmed.

studies and early clinical trials of esmethadone, psilocybin or any future product candidate may not be predictive of the results of later-stage

clinical studies or trials and the results of studies or trials in one set of patients or line of treatment may not be predictive of those

obtained in another.

In fact, many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in

late stage clinical trials even after achieving promising results in preclinical studies and earlier stage clinical trials.

data obtained from preclinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory

Owing in part to the complexity of biological pathways, esmethadone, psilocybin or any future product candidate may not demonstrate

in patients the biochemical and pharmacological properties we anticipate based on laboratory studies or earlier stage clinical trials,

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

The number of patients

exposed to product candidates and the average exposure time in the clinical development programs may be inadequate to detect rare adverse

events or findings that may only be detected once a product candidate is administered to more patients and for greater periods of time.

Our Phase 2 clinical study of REL-1017 involved a small population of subjects with MDD, and, because of the small sample size in such

trial, the results of this clinical trial may be subject to substantial variability and may not be indicative of either future top-line

results or final results.

In addition, results from open-label trials, such as our open-label trial of REL-1017, may not predict results

in placebo-controlled trials for a number of reasons, including biases that may exaggerate therapeutic effect.

On October 13, 2022, we

announced that the RELIANCE III study, evaluating REL-1017 in the monotherapy setting for MDD, did not achieve its primary endpoint, which

was a statistically significant improvement in depression symptoms compared to placebo as measured by the MADRS on Day 28.

7, 2022, we announced that the RELIANCE I study, evaluating REL-1017 in the adjunctive setting for MDD, did not achieve its primary endpoint,

which was a statistically significant improvement in depression symptoms compared to placebo as measured by the MADRS on Day 28.

these findings, even if RELIANCE II, RELIGHT, or any additional Phase 3 studies achieve their primary endpoints, we may not have sufficient

evidence to demonstrate the efficacy of REL-1017 as an adjunctive treatment of MDD.

If we are unable to successfully demonstrate the safety

and efficacy of esmethadone, psilocybin or other future product candidates and receive the necessary regulatory approvals, our business

will be materially harmed.

Even if we do receive regulatory approval to market

esmethadone, any such approval may be subject to limitations on the indicated uses or patient populations for which we may market the

Accordingly, even if we are able to obtain the requisite financing to continue to fund our development programs, we may be

unable to successfully develop or commercialize esmethadone.

If we or any of our future development collaborators are unable to develop,

or obtain regulatory approval for, or, if approved, successfully commercialize esmethadone, we may not be able to generate sufficient

revenue to continue our business.

esmethadone, psilocybin or other future product candidates, any such approval may be subject to limitations on the indicated uses or patient

populations for which we may market the products.

Accordingly, even if we are able to obtain the requisite financing to continue to fund

our development programs, we may be unable to successfully develop or commercialize esmethadone, psilocybin or other future product candidates.

If we or any of our future development collaborators are unable to develop, or obtain regulatory approval for, or, if approved, successfully

commercialize esmethadone, psilocybin or other future product candidates, we may not be able to generate sufficient revenue to continue

our business.

Preliminary or top-line results may not

7 unchanged sentences

Chief Executive Officer except for cause, and we would be unable to conduct our business as planned.

In January 2018, we entered into an Intellectual Property Assignment

Agreement (the “Assignment Agreement”) and License Agreement (the License Agreement and together with the Assignment Agreement,

the Agreements), with Dr.

In January 2018, we entered into an Intellectual

Property Assignment Agreement (the Assignment Agreement) and License Agreement (the License Agreement and together with the Assignment

Agreement, the Agreements), with Dr.

Inturrisi and Dr.

15 unchanged sentences

the financial and other terms of the License Agreement.

Agreement includes standard termination rights for Licensor in the event of our insolvency, challenge of the licensed patents and

uncured material breach of our obligations under the License Agreement.

In addition, the License Agreement contains certain

“Key Man” provisions such that the Licensor may terminate the License Agreement if we terminate the employment of our

Chief Executive Officer, Mr.

Sergio Traversa, for any reason other than for specified causes determined by a majority of our Board

of Directors (including fraud, gross negligence, unauthorized use of our confidential information, conduct including harassment or

discrimination, breach of fiduciary duty or uncured material breach), or if we (a) substantially modify Mr.

Traversa’s job

responsibilities or decision-making rights in connection with the development and commercialization of esmethadone, (b) remove him

from the role of Chief Executive Officer other than in connection with a permitted change-of-control transaction, (c) materially

reduce his compensation, or (d) assign or transfer our rights under the License Agreement or the esmethadone intellectual property

Traversa’s consent, in each case (termination or the events in (a) through (d) during the period commencing on the

effective date and ending on the later of five years from the original effective date of the License Agreement on December 31, 2022.

The License Agreement includes standard termination

rights for Licensor in the event of our insolvency, challenge of the licensed patents and uncured material breach of our obligations under

the License Agreement.

In addition, the License Agreement contains certain “Key Man” provisions such that the Licensor may

terminate the License Agreement if we terminate the employment of our Chief Executive Officer, Mr.

Sergio Traversa, for any reason other

than for specified causes determined by a majority of our Board of Directors (including fraud, gross negligence, unauthorized use of our

confidential information, conduct including harassment or discrimination, breach of fiduciary duty or uncured material breach), or if

we (a) substantially modify Mr.

Traversa’s job responsibilities or decision-making rights in connection with the development and

commercialization of esmethadone, (b) remove him from the role of Chief Executive Officer other than in connection with a permitted change-of-control

transaction, (c) materially reduce his compensation, or (d) assign or transfer our rights under the License Agreement or the esmethadone

intellectual property without Mr.

Traversa’s consent, in each case (termination or the events in (a) through (d) during the period

commencing on the effective date and ending on the later of five years from the original effective date of the License Agreement on December

The December 2019 amendment to the License Agreement made certain clarifications to the nature of a termination for Cause, including

to clarify that termination due to Mr.

Traversa’s death or disability does not give Licensor the right to terminate the

License Agreement.

On December 27, 2022, the Licensor and the Company entered into a new amendment extending the “Key

Man” provision period until December 31, 2027.

Traversa’s death or disability does not give Licensor the right to terminate the License

On December 27, 2022, the Licensor and the Company entered into a new amendment extending the “Key Man” provision

period until December 31, 2027.

The License Agreement was not otherwise modified.

19 unchanged sentences

since inception and generated no product revenues.

If we continue to incur operating losses and fail to become a profitable company,

we may be unable to continue our operations.

We expect to continue to operate at a net loss for at least the next several years as we

continue our research and development efforts, continue to conduct clinical trials and develop manufacturing, sales, marketing and distribution

If we continue to incur operating losses and fail to become a profitable company, we

may be unable to continue our operations.

We expect to continue to operate at a net loss for at least the next several years as we continue

our research and development efforts, continue to conduct clinical trials and develop manufacturing, sales, marketing and distribution

capabilities.

There can be no assurance that the products under development by us will be approved for sales in the US 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.

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.

International commercialization of our product

4 unchanged sentences

Future partners are critical to our international success.

We may not be able to enter into collaboration agreements with

appropriate partners for important foreign markets on acceptable terms, or at all.

Future collaborations with foreign partners may not

be effective or profitable for us.

We will need to obtain approvals from the appropriate regulatory, pricing and reimbursement authorities

to market any of our proposed products internationally, and we may be unable to obtain foreign regulatory approvals.

Pursuing foreign

regulatory approvals will be time-consuming and expensive.

The regulations can vary among countries and foreign regulatory authorities

may require different or additional clinical trials than we conducted to obtain FDA approval for our product candidates.

adverse clinical trial results, such as death or injury due to side effects, could jeopardize not only regulatory approval, but if approval

is granted, may also lead to marketing restrictions.

Our product candidates may also face foreign regulatory requirements applicable

to controlled substances.

We may not be able to enter into collaboration agreements with appropriate

partners for important foreign markets on acceptable terms, or at all.

Future collaborations with foreign partners may not be effective

or profitable for us.

We will need to obtain approvals from the appropriate regulatory, pricing and reimbursement authorities to market

any of our proposed products internationally, and we may be unable to obtain foreign regulatory approvals.

Pursuing foreign regulatory

approvals will be time-consuming and expensive.

The regulations can vary among countries and foreign regulatory authorities may require

different or additional clinical trials than we conducted to obtain FDA approval for our product candidates.

In addition, adverse clinical

trial results, such as death or injury due to side effects, could jeopardize not only regulatory approval, but if approval is granted,

may also lead to marketing restrictions.

Our product candidates may also face foreign regulatory requirements applicable to controlled

We have a history of losses and we may never achieve or sustain

profitability.

We have incurred substantial losses since our

inception, and we may not achieve profitability for the foreseeable future, if at all.

Since inception, we have an accumulated deficit

of approximately $462.1 million at December 31, 2022.

The Company had cash, cash equivalents and short-term investments of approximately

We have incurred substantial losses since our inception, and we may

not achieve profitability for the foreseeable future, if at all.

Since inception, we have an accumulated deficit of approximately $560.9

million at December 31, 2023.

Even if we succeed in developing and commercializing one or more of our product candidates, we expect

to incur substantial net losses and negative cash flows for the foreseeable future due in part to increasing research and development

expenses, including clinical trials, and increasing expenses from leasing additional facilities and hiring additional personnel.

result, we will need to generate significant revenues in order to achieve and maintain profitability.

We may not be able to generate these

revenues or achieve profitability in the future.

The Company had cash, cash equivalents and short-term investments of approximately $96.3 million at December

Even if we succeed in developing and commercializing one or more of our product candidates, we expect to incur substantial net

losses and negative cash flows for the foreseeable future due in part to increasing research and development expenses, including clinical

trials, and increasing expenses from leasing additional facilities and hiring additional personnel.

As a result, we will need to generate

significant revenues in order to achieve and maintain profitability.

We may not be able to generate these revenues or achieve profitability

in the future.

Even if we do achieve profitability, we may not be able to sustain or increase profitability.

We have a limited operating history upon which

to base an investment decision.

We have a limited operating history upon

which to base an investment decision.

Our limited operating history may limit your ability

3 unchanged sentences

early-stage business, many of which may be beyond our control, including:

our potential inability

to continue to undertake preclinical studies, pharmaceutical development and clinical trials,

our potential inability

to obtain regulatory approvals, and

our potential inability

to manufacture, sell and market our products.

Our operations have been limited to organizing and

staffing, on a limited basis, our company, acquiring, developing and securing our proprietary technology and undertaking preclinical

our potential inability to continue to undertake preclinical studies, pharmaceutical development and clinical trials,

our potential inability to obtain regulatory approvals, and

our potential inability to manufacture, sell and market our products.

Our operations have been limited to organizing

and staffing, on a limited basis, our company, acquiring, developing and securing our proprietary technology and undertaking preclinical

studies and clinical trials of our principal product candidates.

1 unchanged sentence

to commercialize our product candidates and the advisability of investing in our common stock.

Our ability to use our net operating loss carryforwards

and certain other tax attributes may be limited.

Our ability to use our net operating loss

carryforwards and certain other tax attributes may be limited.

As of December 31, 2023, we had Federal, New York

24 unchanged sentences

specifically Dr.

Sergio Traversa, our Chief Executive Officer, Dr.

Paolo Manfredi, Acting Chief Scientific Officer, and Dr.

Cedric O’Gorman,

Chief Medical Officer.

If any terminates employment with us, such a departure would have a material adverse effect on our business.

Sergio Traversa, our Chief Executive Officer, and Dr.

Paolo Manfredi, Acting Chief Scientific Officer.

If either terminates

employment with us, such a departure would have a material adverse effect on our business.

Our future success also depends on our ability

14 unchanged sentences

may strain our resources.

We expect to need to grow rapidly in order to support

ongoing and additional, larger, and potentially international, pivotal clinical trials of our drug candidates, which will place a significant

strain on our financial, managerial and operational resources.

In order to achieve and manage growth effectively, we must continue to

improve and expand our operational and financial management capabilities.

Moreover, we will need to increase staffing and to train, motivate

and manage our employees.

We expect to need to grow rapidly in order to

support ongoing and additional, larger, and potentially international, pivotal clinical trials of our drug candidates, which will place

a significant strain on our financial, managerial and operational resources.

In order to achieve and manage growth effectively, we must

continue to improve and expand our operational and financial management capabilities.

Moreover, we will need to increase staffing and

to train, motivate and manage our employees.

We may expand our business through the acquisition

14 unchanged sentences

and the potential loss of our key employees or key employees of the acquired

We cannot assure you that any acquisition will result

in short-term or long-term benefits to us.

We cannot assure you that any acquisition will

result in short-term or long-term benefits to us.

We may incorrectly judge the value or worth of an acquired product, company or business.

addition, our future success would depend in part on our ability to manage the rapid growth associated with some of these acquisitions.

In addition, our future success would depend in part on our ability to manage the rapid growth associated with some of these 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 investment by us.

We may not have these necessary funds or they might not be available to us on acceptable

terms or at all.

We may also seek to raise funds by selling shares of our preferred or common stock, which could dilute each current

stockholder’s ownership interest in us.

Furthermore, the development or expansion of our business or any acquired products, business or companies may require

a substantial capital investment by us.

We may not have these necessary funds or they might not be available to us on acceptable terms

We may also seek to raise funds by selling shares of our preferred or common stock, which could dilute each current stockholder’s

ownership interest in us.

Business interruptions could limit our ability

7 unchanged sentences

could result in losses or damages incurred by us and require us to cease or curtail our operations.

Our business could be adversely affected by

the effects of health epidemics, including the global COVID-19 pandemic.

In December 2019, a novel strain of COVID-19 was

reported in China.

Since then, COVID-19 has spread globally, to include the United States.

The spread of COVID-19 has resulted in the

World Health Organization (WHO) declaring the outbreak of COVID-19 as a “pandemic,” or a worldwide spread of a new disease,

on March 11, 2020.

Many countries around the world have imposed quarantines, travel restrictions, limitations on gatherings, closures

of businesses and other social distancing measures.

As local jurisdictions put restrictions in place,

our ability to continue to operate our business may also be limited.

Such events may result in a period of business and manufacturing

disruption, and in reduced operations, any of which could materially affect our business, financial condition and results of operations.

The COVID-19 pandemic and efforts to contain

the outbreak have led to economic disruption, including changes in interest rates, extreme volatility in financial markets,

fluctuations in foreign currency exchange rates, changes in economic activity and changes in unemployment claims.

potential economic impact brought by COVID-19 may be difficult to assess or predict, a more protracted pandemic could result in

significant disruption of global financial markets, reducing our ability to access capital, which could in the future negatively

affect our liquidity.

In addition, a recession or market correction resulting from the spread of COVID-19 could materially affect

our business and the value of our common shares.

The continued spread of COVID-19 globally could also adversely affect

our planned clinical trial operations, including our ability to initiate trials on expected timelines and recruit and retain patients

and principal investigators and site staff who, as healthcare providers, may have heightened exposure to COVID-19 if an outbreak occurs

in their geography.

Further, the COVID-19 outbreak could result in delays in our clinical trials due to prioritization of hospital resources

toward the outbreak, restrictions in travel, potential unwillingness of patients to enroll in trials at this time, or the inability of

patients to comply with clinical trial protocols if quarantines or travel restrictions impede patient movement or interrupt healthcare

In addition, we rely on independent clinical investigators, contract research organizations and other third-party service providers

to assist us in managing, monitoring and otherwise carrying out our preclinical studies and clinical trials, and an outbreak may affect

their ability to devote sufficient time and resources to our programs or to travel to sites to perform work for us.

Additionally, COVID-19 may also result in delays

in receiving approvals from local and foreign regulatory authorities, delays in necessary interactions with local and foreign regulators,

ethics committees and other important agencies and contractors due to limitations in employee resources or forced furlough of government

The global outbreak of COVID-19 continues to

The ultimate long-term impact of COVID-19 is highly uncertain and cannot be predicted with confidence.

In addition, since COVID-19

is a pandemic, it could materially affect our operations globally, including at our headquarters and at our future clinical trial sites

throughout the globe.

Our business could be adversely affected by health

epidemics in regions where we have significant manufacturing and distribution facilities, concentrations of clinical trial sites or other

business operations.

The ultimate impact of the COVID-19 outbreak

or a similar 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 supply chain, clinical trials, healthcare systems or the global economy as a whole.

However, these effects could

have a material impact on our operations, and, therefore, we will continue to monitor the COVID-19 situation closely and implement risk

mitigation as needed.

Our business could be adversely affected

by the effects of Russia’s invasion of Ukraine .

On February 24, 2022, Russia launched a large-scale

invasion of Ukraine.

The United States and other countries and certain international organizations have imposed broad-ranging economic

sanctions on Russia and certain Russian individuals, banking entities and corporations as a response, and additional sanctions may be

imposed in the future.

The extent and duration of the military action or future escalation of such hostilities, resulting sanctions and

future market disruptions and volatility are impossible to predict, but could be significant and could have a severe adverse effect on

the regional and global economies.

The ramifications of the hostilities and sanctions may not be limited to Russia, Ukraine and

Russian and Ukrainian companies but may spill over to and negatively impact other regional and global economic markets (including Europe

and the United States), companies in other countries (particularly those that have done business with Russia and Ukraine) and on

various sectors, industries and the markets for credit, securities and commodities globally.

In addition, Russia may take retaliatory

actions and other countermeasures, including cyberattacks and espionage against other countries and companies around the world, including

attacks on key infrastructure such as the power grid and the internet.

The potential for a wider conflict could further increase

financial market volatility and could negatively affect our ability to raise additional capital when required.

While we do not

currently conduct any business in Russia or Ukraine, the conflict and its effects could adversely affect our planned clinical trial operations,

including our ability to recruit and retain patients.

Risks Related to Clinical and Regulatory Matters

14 unchanged sentences

regulatory approvals would:

delay commercialization

of, and product revenues from, our drug candidates;

diminish the competitive

advantages that we may have otherwise enjoyed, which would have an adverse effect on our operating results and financial condition.

delay commercialization of, and product revenues from, our drug candidates;

diminish the competitive advantages that we may have otherwise enjoyed, which would have an adverse effect on our operating results and financial condition.

Even if we or our collaborators comply with all

29 unchanged sentences

significant improvements in depression symptoms compared to placebo on Day 28.

Even if our RELIANCE II or other Phase 3 clinical trials

are positive, we or our collaborators may have to commit substantial time and additional resources to conducting further preclinical studies

and clinical trials before obtaining FDA approval for any of our drug candidates.

Our clinical trials and our future clinical trials

for esmethadone measure clinical symptoms, such as depression that are not biologically measurable.

The primary measure of depression

is subjective and can be influenced by factors outside of our control, and can vary widely from day to day for a particular patient, and

from patient to patient and site to site within a clinical study.

The results we have obtained in completed animal studies or we have

observed in our clinical trials conducted to date may not be predictive of results from our future clinical trials.

For example, our RELIANCE

III and RELIANCE I studies did not achieve their primary endpoints, statistically significant improvements in depression symptoms compared

to placebo on Day 28.

In addition, clinical trial results from the study of depression are inherently difficult to predict.

Clinical trials are very expensive and difficult to design and implement,

in part because they are subject to rigorous requirements.

The clinical trial process also consumes a significant amount of time.

if participating patients in clinical trials suffer drug-related adverse reactions during the course of such clinical trials, or if we,

our collaborators or the FDA believe that participating patients are being exposed to unacceptable health risks, such clinical trials

will have to be suspended or terminated.

Failure can occur at any stage of the clinical trials, and we or our collaborators could encounter

problems that cause abandonment or repetition of clinical trials.

Even if our RELIANCE II, RELIGHT or other potential Phase

3 clinical trials are positive, we or our collaborators may have to commit substantial time and additional resources to conducting further

preclinical studies and clinical trials before obtaining FDA approval for any of our drug candidates.

Clinical trial results from the study of depression

are inherently difficult to predict.

In addition, our clinical trials and our future clinical trials for esmethadone measure clinical

symptoms, such as depression that are not biologically measurable.

The primary measure of depression is subjective and can be influenced

by factors outside of our control, and can vary widely from day to day for a particular patient, and from patient to patient and site

to site within a clinical study.

The results we have obtained in completed animal studies or we have observed in our clinical trials

conducted to date may not be predictive of results from our future clinical trials.

For example, our RELIANCE III and RELIANCE I studies

did not achieve their primary endpoints, statistically significant improvements in depression symptoms compared to placebo on Day 28.

Clinical trials are very expensive and difficult

to design and implement, in part because they are subject to rigorous requirements.

The clinical trial process also consumes a significant

amount of time.

Furthermore, if participating patients in clinical trials suffer drug-related adverse reactions during the course of

such clinical trials, or if we, our collaborators or the FDA believe that participating patients are being exposed to unacceptable health

risks, such clinical trials will have to be suspended or terminated.

Failure can occur at any stage of the clinical trials, and we or

our collaborators could encounter problems that cause abandonment or repetition of clinical trials.

We have a limited history of developing drug

14 unchanged sentences

The FDA’s and other regulatory agencies’

decision to approve our depression product candidate will depend on our ability to demonstrate with substantial clinical evidence through

adequate well-controlled clinical trials, that the product candidate is effective, as measured statistically by comparing the overall

decisions to approve our product candidates will depend on our ability to demonstrate through adequate well-controlled clinical trials,

that the product candidate is effective.

For esmethadone product candidate, efficacy is measured statistically by comparing the overall

improvement in depression in actively-treated patients against improvement in depression in the control group (a placebo control).

13 unchanged sentences

required to conduct a clinical trial could increase.

The DEA through its quota system limits

the availability of the active ingredients in certain of our current drug candidates and, as a result, the Company’s quotas for

these ingredients may not be sufficient to complete clinical trials, or to meet commercial demand or may result in clinical delays.

The DEA regulates certain controlled substance

chemical compounds as Schedule I, II, III, IV or V substances, with Schedule I substances considered to present the highest risk of abuse

and Schedule V substances the lowest risk.

Esmethadone is the single isomer of methadone, a Schedule II compound, and its handling (including

manufacture, research, shipment, storage, sale and use) is subject to a high degree of federal and state oversight and regulation.

the amount of Schedule II substances that can be obtained for clinical trials and commercial distribution is limited by the DEA through

its quota system.

Quotas may not be sufficient to complete clinical trials or meet commercial demand.

There is a risk that federal statutes

and DEA regulations concerning applicable quotas may interfere with the supply of the drugs used in clinical trials for our product candidates,

and, in the future, the ability to manufacture and distribute esmethadone in the volume needed to meet commercial demand.

Conducting clinical trials of our drug

34 unchanged sentences

of the product from the market.

Any product promotion and advertising will also be subject to regulatory requirements and continuing regulatory

Any product promotion and advertising will also be subject to regulatory requirements and continuing

regulatory review.

The FDA imposes stringent restrictions on manufacturers’ communications regarding use of their products.

If we promote our

product candidates in a manner inconsistent with FDA-approved labeling or otherwise not in compliance with FDA regulations, we may be

subject to enforcement action.

If we or our collaborators, manufacturers or service providers fail to comply with applicable continuing

regulatory requirements in the United States or foreign jurisdictions in which we seek to market our products, we or they may be subject

to, among other things, fines, warning or untitled letters, holds on clinical trials, suspension or withdrawal of regulatory approval,

product recalls and seizures, administrative detention of products, refusal to permit the import or export of products, operating restrictions,

injunction, civil penalties and criminal prosecution.

we promote our product candidates in a manner inconsistent with FDA-approved labeling or otherwise not in compliance with FDA regulations,

we may be subject to enforcement action.

If we or our collaborators, manufacturers or service providers fail to comply with applicable

continuing regulatory requirements in the United States or foreign jurisdictions in which we seek to market our products, we or they

may be subject to, among other things, fines, warning or untitled letters, holds on clinical trials, suspension or withdrawal of regulatory

approval, product recalls and seizures, administrative detention of products, refusal to permit the import or export of products, operating

restrictions, injunction, civil penalties and criminal prosecution.

The FDA’s policies may change and additional

22 unchanged sentences

Generally, if a product with an orphan drug designation

subsequently receives the first marketing approval for the indication for which it has such designation, the product is entitled to a

period of marketing exclusivity, which precludes the FDA from approving another marketing application for the same drug for the same

disease for seven years.

Orphan drug exclusivity may be lost if the FDA determines that the request for designation was materially defective

or if the manufacturer is unable to assure sufficient quantity of the drug to meet the needs of patients with the rare disease or condition.

We have obtained orphan drug designation for esmethadone

for the treatment of postherpetic neuralgia.

If the product candidate were to obtain orphan drug exclusivity upon approval, such exclusivity

would prevent the FDA from approving another application to market a drug containing the same active moiety for the same orphan indication,

except in very limited circumstances, including when the FDA concludes that the later drug is safer, more effective or makes a major contribution

to patient care.

In addition, a designated orphan drug may not receive orphan drug exclusivity if it is approved for a use, such as MDD,

that is broader than the indication for which it received orphan designation.

subsequently receives the first marketing approval for the indication for which it has such designation, the active ingredient is entitled

to a period of marketing exclusivity, which precludes the FDA from approving another marketing application for the same active ingredient

for the same disease for seven years.

Orphan drug exclusivity may be lost if the FDA determines that the request for designation was materially

defective or if the manufacturer is unable to assure sufficient quantity of the drug to meet the needs of patients with the rare disease

or condition.

We have obtained orphan drug designation for

esmethadone for the treatment of postherpetic neuralgia.

If the product candidate were to obtain orphan drug exclusivity upon approval,

such exclusivity would prevent the FDA from approving another application to market a drug containing the same active moiety for the

same orphan indication, except in very limited circumstances, including when the FDA concludes that the later drug is safer, more effective

or makes a major contribution to patient care.

In addition, a designated orphan drug may not receive orphan drug exclusivity if it is

approved for a use, such as MDD, that is broader than the indication for which it received orphan designation.

Even though we have received orphan drug designation

13 unchanged sentences

The Hatch-Waxman Amendments provide marketing exclusivity

to the first applicant to gain approval of an NDA under specific provisions of the Federal Food, Drug, and Cosmetic Act.

For esmethadone,

which we intend to elect to have not be considered the same active ingredient as methadone and therefore an NCE, we anticipate obtaining

5-year exclusivity.

If FDA were to determine that we do not meet the requirements to make the election, we may not be able to obtain 5-year

exclusivity for the product.

In addition, under the statute, this election currently may only be made in an NDA submitted before

October 1, 2027.

to the first applicant to gain approval of an NDA under specific provisions of the FDCA.

For esmethadone, which we intend to elect to

have not be considered the same active ingredient as methadone and therefore an NCE, we anticipate obtaining 5-year exclusivity.

were to determine that we do not meet the requirements to make the election, we may not be able to obtain 5-year exclusivity for the product.

In addition, under the statute, this election currently may only be made in an NDA submitted before October 1, 2027.

There can be no assurance that European authorities

14 unchanged sentences

We have very limited drug development experience in other therapeutic areas and we may be unsuccessful in

making this change from a depression company to a company with a focus in areas other than depression or a company with a focus in multiple

therapeutic areas including depression.

making this change from a depression company to a company with a focus in areas other than depression, such as metabolic disorders with

psilocybin, or a company with a focus in multiple therapeutic areas including depression.

Our product candidates contain controlled

1 unchanged sentence

statutes and regulations, and the use of which may generate public controversy.

The active ingredients in esmethadone are listed

by the CSA and regulations promulgated by the DEA as controlled substances.

The CSA and regulations promulgated by the DEA regulate certain

drug substances in Schedule I, II, III, IV or V, with Schedule I substances considered to present the highest risk of substance abuse

and Schedule V substances the lowest risk.

These product candidates are also subject to the CSA and DEA regulations relating to their

handling (i.e., manufacturing, storage, distribution, prescribing and dispensing procedures).

The active ingredients in esmethadone and psilocybin

are listed by the CSA and regulations promulgated by the DEA as controlled substances.

The CSA and regulations promulgated by the DEA

regulate certain drug substances in Schedule I, II, III, IV or V, with Schedule I substances considered to present the highest risk of

substance abuse and Schedule V substances the lowest risk.

These product candidates are also subject to the CSA and DEA regulations relating

to their handling (i.e., manufacturing, storage, distribution, prescribing and dispensing procedures).

Furthermore, the amount of controlled

substances that can be obtained for clinical trials and commercial distribution is limited by the DEA through its quota system.

may not be sufficient to complete clinical trials or meet commercial demand.

There is a risk that federal statutes and DEA regulations

concerning applicable quotas may interfere with the supply of the drugs used in clinical trials for our product candidates and the ability

to manufacture and distribute our product candidates, if approved, in the volume needed to meet commercial demand.

Products containing controlled substances may

6 unchanged sentences

or the cost of compliance with these regulations, may adversely affect our business.

Esmethadone is subject to extensive regulation

Esmethadone and psilocybin are subject to extensive

regulation by the DEA.

Although esmethadone is substantially devoid of opioid activity, and psychotomimetic effects, it is currently classified

3 unchanged sentences

Esmethadone is produced by separation from racemic methadone, a scheduled drug subject to extensive regulation by

Any psilocybin-containing product candidate we develop is also subject to extensive regulation by the DEA as a Schedule I substance.

The manufacture, shipment, storage, sale and use

of controlled substances are highly regulated, including security, recordkeeping and reporting obligations enforced by the DEA.

I substances by definition have a high potential for abuse, have no currently “accepted medical use” in the United States,

lack accepted safety for use under medical supervision, and may not be prescribed, marketed or sold in the United States.

Schedule I and

II substances (as well as substances defined as narcotics in any Schedule) are subject to the strictest regulatory requirements and restrictions

7 unchanged sentences

The DEA limits the availability and production

of all scheduled substances, including esmethadone, through a quota system.

The DEA requires substantial evidence and documentation of

expected legitimate medical and scientific needs before assigning quotas to manufacturers.

of all scheduled substances, including esmethadone and psilocybin, through a quota system.

The DEA requires substantial evidence and documentation

of expected legitimate medical and scientific needs before assigning quotas to manufacturers.

In future years, we may need greater amounts

6 unchanged sentences

results of operations, financial condition and prospects.

Psilocybin is currently classified as a Schedule I drug in the

United States, and any product containing this substance must be rescheduled to be marketed.

There can be no assurance that the DEA will

make a favorable scheduling decision.

Even assuming categorization as a Schedule II or lower controlled substance (i.e., Schedule III,

IV or V) at the federal level, such substances would also require scheduling determinations under state laws and regulations.

If approved by FDA, and if

the finished dosage form of a future psilocybin-containing drug product is listed by the DEA as a Schedule II, III, or IV controlled

substance, its manufacture, importation, exportation, domestic distribution, storage, sale, prescribing, and dispensing will continue

to be subject to a significant degree of regulation by the DEA.

In addition, the final scheduling process may take significantly longer

than the 90-day deadline set forth in the CSA, especially if there are objections to such scheduling, thereby delaying the launch of

our psilocybin-containing product candidate in the United States.

the FDA, DEA or any comparable foreign regulatory authority could require us to generate more clinical or other data than we currently

anticipate to establish whether or to what extent the substance has an abuse or misuse potential, which could increase the cost and/or

delay the launch of any future psilocybin-containing product candidates.

In addition, product candidates containing controlled substances

are subject to regulations relating to manufacturing, storage, distribution, prescribing, and dispensing, including:

● State-controlled

substances laws .

Individual U.S.

states have also established controlled substance laws

and regulations.

Though state-controlled substances laws often mirror federal law, because

the states are separate jurisdictions, they will need to separately reschedule any future

psilocybin-containing drug products we develop, if approved by FDA.

State scheduling may

delay commercial sale of any product for which we obtain federal regulatory approval and

adverse scheduling would have a material adverse effect on the commercial attractiveness

of such product.

We or our vendors must also obtain separate state registrations, permits

or licenses in order to be able to obtain, handle, and distribute controlled substances for

clinical trials or, if approved, commercial sale, and failure to meet applicable regulatory

requirements could lead to enforcement and sanctions by the states in addition to those from

the DEA or otherwise arising under federal law.

Because we plan to conduct clinical trials of a psilocybin-containing product

candidate in the United States prior to approval, each of our research sites must submit

a research protocol to the DEA and obtain and maintain a DEA Schedule I researcher registration

that will allow those sites to handle and dispense this product candidate and to obtain the

product from our importer.

If the DEA delays or denies the grant of a researcher registration

or approval of the research protocol to one or more research sites, the clinical trial could

be significantly delayed, and we could lose clinical trial sites.

The importer for the clinical

trials must also obtain a Schedule I importer registration and an import permit for each

We do not currently conduct any manufacturing or repackaging/relabeling of either

psilocybin or the psilocybin-containing product candidate in the United States.

potential reclassification of psilocybin in the United States could create additional regulatory burdens on our operations and nega tively

affect our results of operations.

If psilocybin, rather than

just a specific FDA-approved formulation, is rescheduled under the CSA as a Schedule II or lower controlled substance (i.e., Schedule

III, IV or V), the ability to conduct research on psilocybin would most likely be improved.

However, rescheduling psilocybin may materially

alter enforcement policies across many federal and state agencies, primarily FDA and DEA.

FDA’s responsibilities include regulating

the ingredients as well as the marketing and labeling of drugs sold in interstate commerce.

Because it is currently illegal under federal

law to produce and sell psilocybin, and because there are no federally recognized medical uses, FDA has historically deferred enforcement

related to psilocybin to the DEA.

If psilocybin were to be rescheduled to a federally controlled, yet legal, substance, FDA would likely

play a more active regulatory role.

The DEA would continue to be active in regulating manufacturing, distribution and dispensing of such

The potential for multi-agency enforcement post-rescheduling, including state agencies, e.g., Boards of Pharmacy, could threaten

or have a materially adverse effect on our business.

In addition, if the psilocybin-containing product candidate is scheduled as Schedule

II, III, IV or V, we would also need to identify wholesale distributors with the appropriate DEA registrations and authority to distribute

the psilocybin-containing product candidate.

The failure to obtain, or delay in obtaining, or the loss of any of those registrations could

result in increased costs to us.

If the psilocybin-containing product candidate is classified as a Schedule II drug, participants in our

supply chain may have to maintain enhanced security including specially constructed vaults at manufacturing and distribution facilities.

This additional security may also discourage some pharmacies from carrying the product.

If a supplier of an active pharmaceutical

1 unchanged sentence

supply on a timely or acceptable basis.

Our pharmaceutical excipients and other APIs are

multisource, although not all sources have an active Drug Master File (DMF) with the FDA.

A DMF is a submission to the FDA used to provide

confidential detailed information about facilities, processes, or articles used in the manufacturing, processing, packaging, and storing

of drugs to support drug development and approval.

In addition, some of the countries for our multisource APIs may not be same as our

drug manufacturing locations.

Thus, any disruption in supply from our preferred vendors could result in significant delays with our pharmaceutical

development, clinical trials, NDA submission, NDA approval or commercial sale of the finished product due to contract delays, the need

to manufacture a new batch of API, out of specification API, the need for import and export permits, and the failure of the newly sourced

API to perform to the standards of the previously sourced API.

Our APIs and pharmaceutical excipients are multisource,

although not all sources have an active Drug Master File (DMF) with the FDA.

A DMF is a submission to the FDA used to provide confidential

detailed information about facilities, processes, or articles used in the manufacturing, processing, packaging, and storing of drugs to

support drug development and approval.

In addition, some of the countries for our multisource APIs may not be same as our drug manufacturing

Thus, any disruption in supply from our preferred vendors could result in significant delays with our pharmaceutical development,

clinical trials, NDA submission, NDA approval or commercial sale of the finished product due to contract delays, the need to manufacture

a new batch of API, out of specification API, the need for import and export permits, and the failure of the newly sourced API to perform

to the standards of the previously sourced API.

Modifications to our products, if approved,

24 unchanged sentences

obtaining approval of the

institutional review board (IRB) at each site selected for participation in our clinical trials;

IRB at each site selected for participation in our clinical trials;

manufacturing sufficient

43 unchanged sentences

Serious injury or death resulting from a failure

of one of our drug candidates during current or future clinical trials could result in the FDA delaying our clinical trials or denying

or delaying clearance or approval of a product.

Even though an adverse event may not be the result of the failure of our drug candidate,

FDA or an IRB could delay or halt a clinical trial for an indefinite period of time while an adverse event is reviewed, and likely would

do so in the event of multiple such events.

Any delay or termination of our current or future clinical trials as a result of the risks

summarized above, including delays in obtaining or maintaining required approvals from IRBs, delays in patient enrollment, the failure

of patients to continue to participate in a clinical trial, and delays or termination of clinical trials as a result of protocol modifications

or adverse events during the trials, may cause an increase in costs and delays in the submission of any NDAs to the FDA, delay the approval

and commercialization of our products or result in the failure of the clinical trial, which could adversely affect our business, operating

results and prospects.

Lengthy delays in the completion of clinical trials of our products would adversely affect our business and prospects

and could cause us to cease operations.

of one of our drug candidates during current or future clinical trials could result in the FDA halting or delaying our clinical trials

or denying or delaying clearance or approval of a product.

Even though an adverse event may not be the result of the failure of our drug

candidate, FDA or an IRB could delay or halt a clinical trial for an indefinite period of time while an adverse event is reviewed, and

likely would do so in the event of multiple such events.

Any delay or termination of our current or future clinical trials as a result

of the risks summarized above, including delays in obtaining or maintaining required approvals from IRBs, delays in patient enrollment,

the failure of patients to continue to participate in a clinical trial, and delays or termination of clinical trials as a result of protocol

modifications or adverse events during the trials, may cause an increase in costs and delays in the submission of any NDAs to the FDA,

delay the approval and commercialization of our products or result in the failure of the clinical trial, which could adversely affect

our business, operating results and prospects.

Lengthy delays in the completion of clinical trials of our products would adversely affect

our business and prospects and could cause us to cease operations.

On November 29, 2006, the FDA required a boxed

warning to be added to the Prescribing Information for racemic methadone, a parent compound to our esmethadone related to cardiac death.

Although the decision was based on case reports and not on a controlled clinical trial, as part of the development of esmethadone we are

and have actively assessed the cardiac safety profile of esmethadone in our Phase 3 clinical trials.

There is no assurance that the results

of our clinical studies will demonstrate an absence of cardiac adverse events with esmethadone.

An adverse safety outcome could result

in a similar bolded warning on the label of esmethadone or in a decision not to approve esmethadone, either one of which could have serious

consequences for our continued operation.

Esmethadone may require Risk Evaluation

and Mitigation Strategies (REMS).

Esmethadone, may require REMS.

The REMS may include

requirements for special labeling or medication guides for patients, special communication plans to health care professionals and restrictions

on distribution and use.

We cannot predict the specific REMS to be required as part of the FDA’s approval of any of our products.

Depending on the extent of the REMS requirements, our costs to commercialize our products may increase significantly.

Furthermore, controlled

substances risks that are not adequately addressed through proposed REMS for our product candidates may also prevent or delay their approval

for commercialization.

warning to be added to the Prescribing Information related to cardiac death for racemic methadone, a parent compound to our esmethadone.

Although the decision was based on case reports and not on a controlled clinical trial, as part of the development of esmethadone, we

currently assess (and have actively assessed) the cardiac safety profile of esmethadone in our Phase 3 clinical trials.

There is no assurance

that the results of our clinical studies will demonstrate an absence of cardiac adverse events with esmethadone.

An adverse safety outcome

could result in a similar bolded warning on the label of esmethadone or in a decision not to approve esmethadone, either one of which

could have serious consequences for our continued operation.

If approved, esmethadone and any psilocybin-containing

drug product we successfully develop may require Risk Evaluation and Mitigation Strategies (REMS).

Esmethadone and any psilocybin-containing drug

product we successfully develop, may require REMS.

The REMS may include requirements for special labeling or medication guides for patients,

special communication plans to health care professionals and restrictions on distribution and use.

We cannot predict the specific REMS

to be required as part of the FDA’s approval of any of our products.

Depending on the extent of the REMS requirements, our costs

to commercialize our products may increase significantly.

Furthermore, controlled substances risks that are not adequately addressed through

proposed REMS for our product candidates may also prevent or delay their approval for commercialization.

Our products will face significant competition

18 unchanged sentences

Our chief competitors

include companies such as Johnson and Johnson, Abbvie, Pfizer, Eli Lilly, Sage Therapeutics, and Axsome Therapeutics among others.

include companies such as Johnson and Johnson, Abbvie, Pfizer, Eli Lilly, Axsome Therapeutics, and Neumora Therapeutics, Inc.

among others.

We may be exposed to liability claims associated

86 unchanged sentences

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 our

patents does not guaranty that we will secure the right to commercialize our patents.

Our ability to protect and enforce our patents

does not guarantee that we will secure the right to commercialize our patents.

A patent is a limited monopoly right conferred

131 unchanged sentences

federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the civil False Claims Act;

HIPAA imposes criminal

and civil liability for, among other things, knowingly and willfully executing or attempting to execute a scheme to defraud any healthcare

benefit program or making false statements relating to healthcare matters.

Similar to the federal Anti-Kickback Statute, a person

or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

HIPAA, as amended by HITECH, imposes criminal and civil liability for,

among other things, knowingly and willfully executing or attempting to execute a scheme to defraud any healthcare benefit program or making

false statements relating to healthcare matters.

Similar to the federal Anti-Kickback Statute, a person or entity does not need to have

actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

the federal Physician Payment

4 unchanged sentences

their immediate family, which includes annual data collection and reporting obligations;

analogous state and foreign

laws and regulations, such as state anti-kickback and false claims laws, may apply to sales or marketing arrangements and claims

involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers;

and some state

laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the

relevant compliance guidance promulgated by the federal government and may require drug manufacturers to report information related

to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures;

some state laws require

pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance

guidance promulgated by the federal government and may require drug manufacturers to report information related to payments and other

transfers of value to physicians and other healthcare providers or marketing expenditures.

analogous state and

foreign laws and regulations, such as state anti-kickback and false claims laws, may apply to sales or marketing arrangements and

claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers;

some state laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines

and the relevant compliance guidance promulgated by the federal government and may require drug manufacturers to report information

related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures or drug

Efforts to ensure that our business arrangements

11 unchanged sentences

government-funded healthcare programs.

Enacted and future legislation may affect the prices we may set.

The full effect of recent United States healthcare reform and other changes in the healthcare industry, laws, and regulations and in healthcare

spending is currently unknown, and the reform and other changes may adversely affect our business model.

In the United States and some foreign jurisdictions, there have been

a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could, among other things, affect

our ability to profitably sell any products for which we obtain marketing approval.

The commercial

potential for our products, if any, could also be affected by changes in healthcare spending and policy in the United States and abroad.

New laws, regulations, or judicial decisions or new interpretations of existing laws, regulations, or decisions, related to healthcare

availability, the method of delivery, or payment for healthcare products and services could adversely affect our business, operations,

and financial condition, if and when we are able to obtain marketing approval and commercialize our products.

For example, the ACA was

enacted in 2010 with a goal, among others, of reducing the cost of healthcare and substantially changing the way healthcare is financed

by both government and private insurers.

The ACA, among other things, expanded manufacturers’ rebate liability under the Medicaid

Drug Rebate Program, imposed a significant annual, nondeductible fee on companies that manufacture or import certain branded prescription

drug products, and enacted substantial provisions affecting compliance, which may affect our business practices with healthcare practitioners.

have been and continue to be a number of initiatives at the U.S.

federal and state levels that seek to reduce healthcare costs in general

and the cost of pharmaceuticals in particular.

These initiatives recently culminated in the enactment of the Inflation Reduction Act,

or IRA, in August 2022, which, among other things, will allow HHS to negotiate the selling price of certain drugs and biologics that CMS

reimburses under Medicare Part B and Part D (excluding drugs and biologics that are designated and approved for only one rare disease

or condition), although only high-expenditure single-source biologics that have been approved for at least 11 years (7 years for drugs)

can be selected by CMS for negotiation, with the negotiated price taking effect two years after the selection year.

The negotiated prices,

which will first become effective in 2026, will be capped at a statutory ceiling price representing a significant discount from average

prices to wholesalers and direct purchasers.

Beginning in October 2022 for Medicare Part D and January 2023 for Medicare Part B, the law

also penalizes drug manufacturers that increase prices of Medicare Part D and Part B drugs at a rate greater than the rate of inflation.

In addition, the law eliminates the “donut hole” under Medicare Part D beginning in 2025 by significantly lowering the beneficiary

maximum out-of-pocket cost through a newly established manufacturer discount program.

The IRA also extends enhanced subsidies for individuals

purchasing health insurance coverage in ACA marketplaces through plan year 2025.

The IRA permits the Secretary of HHS to implement many

of these provisions through guidance, as opposed to regulation, for the initial years.

Manufacturers that fail to comply with the IRA

may be subject to various penalties, including civil monetary penalties.

These provisions will take effect progressively starting in 2023,

although they may be subject to legal challenges.

Thus, the IRA will likely have a significant impact on the pharmaceutical industry.

Enacted and future legislation may affect

the prices we may set.

The full effect of recent United States healthcare reform and other changes in the healthcare industry, laws,

and regulations and in healthcare spending is currently unknown, and the reform and other changes may adversely affect our business model.

In the United States and some foreign jurisdictions,

there have been a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could, among

other things, affect our ability to profitably sell any products for which we obtain marketing approval.

The commercial potential for our products, if any, could also be affected

by changes in healthcare spending and policy in the United States and abroad.

New laws, regulations, or judicial decisions or new interpretations

of existing laws, regulations, or decisions, related to healthcare availability, the method of delivery, or payment for healthcare products

and services could adversely affect our business, operations, and financial condition, if and when we are able to obtain marketing approval

and commercialize our products.

For example, the ACA was enacted in 2010 with a goal, among others, of reducing the cost of healthcare

and substantially changing the way healthcare is financed by both government and private insurers.

The ACA, among other things, expanded

manufacturers’ rebate liability under the Medicaid Drug Rebate Program, imposed a significant annual, nondeductible fee on companies

that manufacture or import certain branded prescription drug products, and enacted substantial provisions affecting compliance, which

may affect our business practices with healthcare practitioners.

There have been and continue to be a number of initiatives at the U.S.

federal and state levels that seek to reduce healthcare costs in general and the cost of pharmaceuticals in particular.

These initiatives

recently culminated in the enactment of the IRA in August 2022, which, among other things, allows HHS to directly negotiate the selling

price of a statutorily speficied number of drugs and biologics each year that CMS reimburses under Medicare Part B and Part D.

Only high-expenditure

single-source biologics that have been approved for at least 11 years (7 years for single-source drugs) can be selected by CMS for negotiation,

with the negotiated price taking effect two years after the selection year.

Negotiations for Medicare Part D products begin in 2024 with

the negotiated price taking effect in 2026, and negotiations for Medicare Part B products begin in 2026 with the negotiated price taking

effect in 2028.

In August 2023, HHS announced the ten Medicare Part D drugs and biologics that it selected for negotiations.

announce the negotiated maximum fair prices by September 1, 2024, and this price cap, which cannot exceed a statutory ceiling price, will

come into effect on January 1, 2026.

A drug or biological product that has an orphan drug designation for only one rare disease or condition

will be excluded from the IRA’s price negotiation requirements, but will lose that exclusion if it has designations for more than

one rare disease or condition, or if is approved for an indication that is not within that single designated rare disease or condition,

unless such additional designation or such disqualifying approvals are withdrawn by the time CMS evaluates the drug for selection for

The IRA also imposes rebates on Medicare Part D and Part B drugs whose prices have increased at a rate greater than the rate

of inflation.

In addition, the law eliminates, beginning in 2025, the coverage gap under Medicare Part D by significantly lowering the

beneficiary maximum out-of-pocket cost and requiring manufacturers to subsidize, through a newly established manufacturer discount program,

10% of Part D enrollees’ prescriptions costs for brand drugs below the out-of-pocket maximum, and 20% once the out-of-pocket maximum

has been reached.

The IRA also extends enhanced subsidies for individuals purchasing health insurance coverage in ACA marketplaces through

plan year 2025.

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

for the initial years.

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

These provisions will take effect progressively starting in 2023, although they may be subject to legal challenges.

For example, the provisions

related to the negotiation of selling prices of high-expenditure single-source drugs and biologics have been challenged in multiple lawsuits

brought by pharmaceutical manufacturers.

Thus, while it is unclear how the IRA will implemented, it will likely have a significant impact

on the pharmaceutical industry.

Further, at the U.S.

state level, legislatures

are increasingly enacting laws and implementing regulations designed to control pharmaceutical and biological product pricing, including

price or reimbursement constraints, discount requirements, marketing cost disclosure and price transparency reporting.

We expect that

additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal

and state governments will pay for healthcare products and services or otherwise negatively impact our business model.

state level, legislatures are increasingly enacting

laws and implementing regulations designed to control pharmaceutical and biological product pricing, including price or reimbursement

constraints, discount requirements, marketing cost disclosure, price gouging prohibitions, and price transparency reporting.

that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that

federal and state governments will pay for healthcare products and services or otherwise negatively impact our business model.

Risks Related to Our Reliance on Third Parties

9 unchanged sentences

to different risks than if we were to manufacture product candidates ourselves.

The manufacturing process for a product

candidate is subject to FDA and foreign regulatory authority review.

The manufacturing process for a product candidate

is subject to FDA and foreign regulatory authority review.

We, and our suppliers and manufacturers, must meet applicable manufacturing

16 unchanged sentences

manufacture our product candidates.

We expect to continue to rely on third-party manufacturers

if we receive regulatory approval for any product candidate.

To the extent that we have existing, or enter into future, manufacturing

arrangements with third parties, we will depend on these third parties to perform their obligations in a timely manner consistent with

contractual and regulatory requirements, including those related to quality control and assurance.

Any manufacturing facilities used to

produce our products will be subject to periodic review and inspection by the FDA and foreign regulatory authorities, including for continued

compliance with cGMP requirements, quality control, quality assurance and corresponding maintenance of records and documents.

unable to obtain or maintain third-party manufacturing for product candidates, or to do so on commercially reasonable terms, we may not

be able to develop and commercialize our product candidates successfully.

Or a third parties’ failure to execute on our manufacturing

requirements, comply with cGMPs or maintain a compliance status acceptable to the FDA or foreign regulatory authorities could adversely

affect our business in a number of ways, including:

We expect to continue to rely on third-party

manufacturers if we receive regulatory approval for any product candidate.

To the extent that we have existing, or enter into future,

manufacturing arrangements with third parties, we will depend on these third parties to perform their obligations in a timely manner

consistent with contractual and regulatory requirements, including those related to quality control and assurance.

Any manufacturing

facilities used to produce our products will be subject to periodic review and inspection by the FDA and foreign regulatory authorities,

including for continued compliance with cGMP requirements, quality control, quality assurance and corresponding maintenance of records

and documents.

If we are unable to obtain or maintain third-party manufacturing for product candidates, or to do so on commercially reasonable

terms, we may not be able to develop and commercialize our product candidates successfully.

Or a third parties’ failure to execute

on our manufacturing requirements, comply with cGMPs or maintain a compliance status acceptable to the FDA or foreign regulatory authorities

could adversely affect our business in a number of ways, including:

an inability to initiate

26 unchanged sentences

that they dedicate to our programs.

These third parties may have contractual relationships with other entities, some of which may be our

competitors, which may draw time and resources from our programs.

These third parties may have contractual relationships with other entities, some of which may be

our competitors, which may draw time and resources from our programs.

The third parties with which we may contract might not be diligent,

91 unchanged sentences

fall below expectations;

negative or poor clinical results;

negative or poor clinical

regulatory developments;

54 unchanged sentences

additional costs associated with resolving such action in other jurisdictions, which could harm our business.

UNRESOLVED STAFF COMMENTS

Not applicable.

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