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Item 1A. Risk Factors

2026-03-19 compared with 2025-03-27 · 538 added, 733 removed, 815 unchanged (61% of the section changed)

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Business risks include risks associated with our products (including

as a result of pausing the development of our prior drug candidates and refocusing on new drug candidates) 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.

as a result of terminating the development of our prior drug candidates and refocusing on new drug candidates) and regulatory approval,

licensing agreements, historical losses, managing growth, acquisitions, and economic uncertainty or downturns.

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

and produce future profits, successful trials need to be completed with supporting data to receive regulatory approval.

Failing to complete

the trial will significantly increase our cost of doing business.

In addition, the active ingredient in some of 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

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 and produce future

profits, successful trials need to be completed with supporting data to receive regulatory approval.

Failing to complete the trial will

significantly increase our cost of doing business.

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

negatively impact future profits.

Risks related to our intellectual property

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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.

Regulatory matters present ongoing risks due to the evolving, complex,

and often uncertain nature of the healthcare regulatory and political landscape in which we operate.

In this environment, 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.

We could also face potential fines or reputational risk

if we do not comply.

Litigation or investigations can increase costs, negatively affect our operating results and create adverse publicity

We could also face

potential fines or reputational risk if we do not comply.

Litigation or investigations can increase costs, negatively affect our operating

results and create adverse publicity for us.

Risks related to our reliance on third

The Company relies on third parties to conduct

nonclinical 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.

The Company relies on third parties to conduct non-clinical 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

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Risks Related to Our Business

Pausing of Our Former Primary Drug Candidate

May Adversely Affect Our Business and Financial Condition

We recently paused the development of our former

primary drug candidate, esmethadone (d-methadone, dextromethadone, or REL-1017) as a potential treatment for major depressive disorder

(MDD), which had been the cornerstone of our research and development efforts.

This decision was made due to an interim analysis indicating

that our Phase 3 study of esmethadone, Reliance II, was futile and unlikely to meet the primary efficacy endpoint with statistical significance.

We also recently paused development of REL-P11, a modified-release formulation of psilocybin, as an investigational agent for the treatment

of metabolic disease.

These determinations have resulted in the loss of significant time, resources and capital invested in the development

of esmethadone and REL-P11.

There can be no assurance that our refocusing on new drug candidates will successfully offset these setbacks.

Ending Development of Our Former Drug Candidates May Adversely Affect

Our Business and Financial Condition

We terminated the development of our former primary drug candidate,

esmethadone (d-methadone, dextromethadone, or REL-1017) as a potential treatment for major depressive disorder (MDD), which had been the

cornerstone of our research and development efforts.

This decision was made due to an interim analysis indicating that our Phase 3 study

of esmethadone, Reliance II, was futile and unlikely to meet the primary efficacy endpoint with statistical significance.

We also recently

terminated development of REL-P11, a modified-release formulation of psilocybin, as an investigational agent for the treatment of metabolic

These determinations resulted in the loss of significant time, resources and capital invested in the development of esmethadone

There can be no assurance that our refocusing on our new drug candidates will successfully offset these setbacks.

Our Refocusing on New Drug Candidates Involves

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

The primary focus of our product development is NDV-01 and Sepranolone.

The primary focus of our product development

is NDV-01 and sepranolone.

This may make an investment in our Company riskier

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is subject to a number of risks, including the following:

not be able to obtain adequate evidence from clinical trials to support the efficacy and safety products’ respective indications;

not be able to demonstrate the clinical benefits of our drug candidates for their respective indications;

clinical trials for our drug candidates, enrollment may be slower than anticipated and we may need additional clinical trial sites

than originally planned, which could delay our clinical trial progress;

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;

in our clinical trials may suffer serious adverse effects for reasons that may or may not be related to our drug candidates, 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;

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

1 and 2 clinical trials;

be certain of the number and type of clinical trials and nonclinical or toxicology studies that the FDA or other regulatory agencies

will require in order to approve our drug candidates for their respective indications;

not have sufficient financial and other resources to complete the necessary clinical trials for our drug candidates, including, but

not limited to, the clinical trials needed to obtain drug approval;

our drug candidates will likely compete with products that may reach approval prior to these products, products that are currently approved

and the off-label use of currently marketed products;

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

Our drug candidates 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.

The drug development and approval process

is lengthy and expensive, and approval is never certain.

Investigational new drugs, such as our drug candidates 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

products proceeding through clinical trials.

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

to demostrate the efficacy, safety and favorable benefit-risk profile of our product candidates for their respective indications;

in our clinical trials

for our drug candidates, 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 our drug candidates, 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;

the results of later stage clinical trials may not be as favorable

as the results we have observed to date in our non-clinical studies and Phase 1 and 2 clinical trials;

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

non-clinical or toxicology studies that the FDA or other regulatory agencies will require in order to approve our drug candidates for

their respective indications;

we may not have sufficient

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

clinical trials needed to obtain drug approval;

if approved, our drug candidates

will likely compete with products that may reach approval prior to these products, products that are currently approved and the off-label

use of currently marketed products;

we may not be able to obtain,

maintain or enforce our patents and other intellectual property rights.

Our drug candidates 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.

The drug development

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

Investigational new drugs, such as our drug candidates

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 products proceeding

through clinical trials.

Failure can occur at any time during the clinical trial process.

The results of nonclinical

studies and early clinical trials of our drug candidates 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 nonclinical studies and earlier stage clinical trials.

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

Owing in part to the complexity of biological pathways, our drug candidates 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.

If we are unable to successfully demonstrate the safety and efficacy of our drug candidates 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 our drug candidates

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 our drug candidates 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

our drug candidates or other future product candidates, we may not be able to generate sufficient revenue to continue our business.

The results of non-clinical studies and early

clinical trials of our drug candidates 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

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 non-clinical studies and earlier stage clinical trials.

In addition, data obtained from

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

in part to the complexity of biological pathways, our drug candidates 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.

If we are unable

to successfully demonstrate the safety and efficacy of our drug candidates 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 our drug candidates 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 our drug candidates or other future product

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

successfully commercialize our drug candidates 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

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As a result, preliminary or top-line data should be viewed with caution until the final data are available.

Our license agreement for NDV-01 or esmethadone

could terminate under certain circumstances, including if we terminate our 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.

Inturrisi and Dr.

Paolo Manfredi (collectively, the Licensor).

Pursuant to the Assignment

Agreement, we assigned our existing rights, including patents and patent applications, to esmethadone in the context of psychiatric use

to Licensor, and pursuant to the License Agreement, Licensor then granted us an exclusive perpetual, worldwide license under the assigned

intellectual property rights as well as patents and know-how covering certain new inventions developed by Licensor and relating to esmethadone

in neurological and other uses, to develop and commercialize esmethadone in all fields of use.

The License Agreement also grants to us

rights in all future inventions developed by Licensor, whether or not in collaboration with us that relate in any way to esmethadone

or the use thereof.

The License Agreement was amended in December 2019 to modify certain termination rights relating to the Chief Executive

Officer, which are described further below.

If we develop any new inventions relating to

esmethadone, we are required to do so in collaboration with Licensor, and to file patents covering such inventions jointly in the name

of the Company and Licensor.

All such future inventions or patents shall be jointly owned by us and Licensor and, will be included in

and subject to the financial and other terms of the License Agreement.

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 31, 2022.

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.

The License Agreement was not otherwise modified.

As a result of the provisions described above,

we are limited in our ability to terminate, as well as to decrease the salary or authority of, our Chief Executive Officer until December

In addition, the agreement provides that any assignor that we assign the agreement to must agree in writing to all terms of

the license, including the key man provisions, and as noted above, our Chief Executive Officer has the right to consent to any such assignment

of the agreement unless previously terminated for cause or due to death.

As the license agreement relates to our only product candidate

currently under clinical development, these provisions may be deemed to have an anti-takeover effect and may delay, deter or prevent

a tender offer or takeover attempt that a stockholder might consider to be in its best interests, including attempts that might result

in a premium being paid over the market price for the shares held by stockholders.

If we fail to comply with the terms of the License

Agreement, our rights to those patents may be terminated, and we will be unable to conduct our business.

We May Require Substantial Additional Funding,

Which May Not Be Available on Favorable Terms, or at All

The pause of our former drug candidates and the pivot to new candidates

may increase our need for additional capital to fund ongoing research, clinical trials and operational expenses.

There is no guarantee

that we will be able to secure additional funding on acceptable terms, or at all, particularly given the perceived risk associated with

our recent strategic shift.

Failure to obtain sufficient capital could force us to curtail operations, delay development or seek alternative

strategies, such as liquidation or bankruptcy.

The termination of development of our former drug candidates and the

pivot to new candidates may increase our need for additional capital to fund ongoing research, clinical trials and operational expenses.

There is no guarantee that we will be able to secure additional funding on acceptable terms, or at all, particularly given the perceived

risk associated with our recent strategic shift.

Failure to obtain sufficient capital could force us to curtail operations, delay development

or seek alternative strategies, such as liquidation or bankruptcy.

We have generated no revenue from commercial

sales to date and our future profitability is uncertain.

We have a limited operating history, and our business

is subject to all of the risks inherent in the establishment of a new business enterprise.

Our likelihood of success must be considered

in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with this.

Since we began

our business, we have focused on research, development and clinical trials of product candidates, and have incurred significant losses

since inception and generated no product revenues.

We have a limited operating history, and our

business is subject to all of the risks inherent in the establishment of a new business enterprise.

Our likelihood of success must be

considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with this.

Since we began our business, we have focused on research, development and clinical trials of product candidates, and have incurred significant

losses since inception and generated no product revenues.

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

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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 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

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

our potential inability

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

our potential inability to continue to undertake non-clinical studies,

pharmaceutical development and clinical trials,

our potential inability

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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 nonclinical

studies and clinical trials of our principal product candidates.

These operations provide a limited basis for you to assess our ability

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

Our operations have been limited to organizing and staffing, on a limited

basis, our company, acquiring, developing and securing our proprietary technology and undertaking non-clinical studies and clinical trials

of our principal product candidates.

These operations provide a limited basis for you to assess our ability 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.

of December 31, 2024, we had Federal, New York State and New York City net operating loss

(NOL) carryforwards of approximately $127,041,000, $1,068,000 and $1,068,000, respectively,

which begin expiring in 2027, 2032 and 2032, respectively.

federal tax legislation

enacted in 2017, informally titled the Tax Cuts and Jobs Act, or Tax Act, federal NOLs incurred

in 2018 and in future years may be carried forward indefinitely, but the deductibility of

such federal NOLs is limited to 80% of taxable income in the year.

It is uncertain if and

to what extent various states will conform to the Tax Act.

Under Sections 382 and 383 of

Internal Revenue Code of 1986, as amended, if a corporation undergoes an “ownership

change” (generally defined as a greater than 50 percentage-point cumulative change

(by value) in the equity ownership of certain stockholders over a rolling three-year period),

the corporation’s ability to use its pre-change NOLs and other pre-change tax attributes

to offset its post-change taxable income or taxes may be limited.

We may also experience

ownership changes as a result of stock offerings or as a result of subsequent shifts in our

stock ownership, some of which are outside our control.

We have not completed an analysis

to determine whether any such limitations have been triggered.

If any were determined to

be triggered, our ability to use our current NOLs and other pre-change tax attributes to

offset post-change taxable income or taxes would be subject to limitation.

We will be unable

to use our NOLs if we do not attain profitability sufficient to offset our available NOLs

prior to their expiration.

As of December 31, 2025, we had Federal and State

net operating loss (NOL) carryforwards of approximately $246,410,000, and $2,719,000, respectively, which begin expiring in 2027, 2032

and 2032, respectively.

federal tax legislation enacted in 2017, informally titled the Tax Cuts and Jobs Act, or Tax Act, federal

NOLs incurred in 2018 and in future years may be carried forward indefinitely, but the deductibility of such federal NOLs is limited to

80% of taxable income in the year.

Under Sections 382 and 383 of the U.S.

Internal Revenue Code of 1986, as amended, if a corporation

undergoes an “ownership change” (generally defined as a greater than 50 percentage-point cumulative change (by value) in the

equity ownership of certain stockholders over a rolling three-year period), the corporation’s ability to use its pre-change NOLs

and other pre-change tax attributes to offset its post-change taxable income or taxes may be limited.

We may also experience ownership

changes as a result of stock offerings or as a result of subsequent shifts in our stock ownership, some of which are outside our control.

The Company completed an analysis and determined that there have been multiple changes of ownership as defined by Section 382 of the IRC.

As a result the utilization of the NOLs are limited annually.

Due to the annual limitation some of the NOLs will expire unused regardless

of future taxable income.

We may not be successful in hiring and

retaining key employees.

Our future operations and successes depend in large part upon the continued

service of key members of our senior management team whom we are highly dependent upon to manage our business, specifically Dr.

Traversa, our Chief Executive Officer and our executive team.

If any terminates employment with us, such a departure would have a material

adverse effect on our business.

Our future success also depends on our ability

to identify, attract, hire or engage, retain and motivate other well-qualified managerial, technical, clinical and regulatory personnel.

Our success depends heavily on the expertise of our management team and scientific personnel.

The pivot to new drug candidates may require

specialized knowledge or skills that our current team lacks.

If we lose key personnel or fail to attract and retain qualified replacements,

our ability to execute our revised strategy could be compromised, leading to delays or failure in our development program.

only have 17 full time employees and are likely to hire additional qualified personnel with expertise in nonclinical pharmacology and

toxicology, pharmaceutical development, clinical research, regulatory affairs, manufacturing, sales and marketing.

We compete for qualified

individuals with numerous biopharmaceutical companies, universities and other research institutions.

Competition for such individuals,

particularly in the United States, is intense, and we may not be able to hire sufficient personnel to support our efforts.

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.

Our future operations and successes depend in

large part upon the continued service of key members of our senior management team whom we are highly dependent upon to manage our business,

specifically Dr.

Sergio Traversa, our Chief Executive Officer and our executive team.

If any terminates employment with us, such a departure

would have a material adverse effect on our business.

Our future success also depends on our ability to identify, attract,

hire or engage, retain and motivate other well-qualified managerial, technical, clinical and regulatory personnel.

Our success depends

heavily on the expertise of our management team and scientific personnel.

The pivot to new drug candidates may require specialized knowledge

or skills that our current team lacks.

If we lose key personnel or fail to attract and retain qualified replacements, our ability to execute

our revised strategy could be compromised, leading to delays or failure in our development program.

We currently only have 17 full time

employees and are likely to hire additional qualified personnel with expertise in non-clinical pharmacology and toxicology, pharmaceutical

development, clinical research, regulatory affairs, manufacturing, sales and marketing.

We compete for qualified individuals with numerous

biopharmaceutical companies, universities and other research institutions.

Competition for such individuals, particularly in the United

States, is intense, and we may not be able to hire sufficient personnel to support our efforts.

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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stockholder’s ownership interest in us.

Business interruptions could limit our

ability to operate our business.

Business interruptions could limit our ability

to operate our business.

Our operations as well as those of our collaborators

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

There is doubt about our ability to continue

as a going concern.

As of December 31, 2024, the Company had an accumulated deficit of

$640,882,035.

Losses have principally occurred as a result of the substantial resources required for research and development of the Company’s

product candidates which included the general and administrative expenses associated with its organization and product development as

well as the lack of sources of revenues until such time as the Company’s products are commercialized.

These factors raise substantial

doubt about the Company’s ability to continue as a going concern for the 12 months from the issuance date of these audited consolidated

financial statements for the year ended December 31, 2024.

These financial statements do not include any adjustments to reflect the possible

future effect on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from

the outcome of these uncertainties.

Management intends to pursue additional funding and implement its strategic plan to allow the opportunity

for the Company to continue as a going concern.

However, there cannot be any assurance that we will be successful in doing so.

Risks Related to Clinical and Regulatory Matters

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If we or our collaborators fail to obtain regulatory

approval for any of our drug candidates we will have fewer commercial products, if any, and corresponding lower product revenues, if

Even if our drug candidates receive regulatory approval, such approval may involve limitations on the indications and conditions

of use or marketing claims for our products.

Further, later discovery of previously unknown problems or adverse events could result in

additional regulatory restrictions, including withdrawal of products.

The FDA may also require us or our collaborators to commit to perform

lengthy Phase 4 post-approval clinical efficacy or safety studies.

Our expending additional resources on such trials would have an adverse

effect on our operating results and financial condition.

approval for any of our drug candidates we will have fewer commercial products, if any, and corresponding lower product revenues, if any.

Even if our drug candidates receive regulatory approval, such approval may involve limitations on the indications and conditions of use

or marketing claims for our products.

Further, later discovery of previously unknown problems or adverse events could result in additional

regulatory restrictions, including withdrawal of products.

The FDA may also require us or our collaborators to commit to perform lengthy

Phase IV post-approval clinical efficacy or safety studies.

Our expending additional resources on such trials would have an adverse effect

on our operating results and financial condition.

In jurisdictions outside the United States, we

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design, conduct and complete successful clinical trials, our drug candidates will not be able to receive regulatory approval.

Before obtaining regulatory approvals for the

commercial sale of any of our product candidates, we must demonstrate through lengthy, complex and expensive nonclinical testing and

clinical trials that the product is both safe and effective for use in each target indication.

Results from early clinical trials may not support

moving a drug candidate to later-stage clinical trials.

Phase 3 clinical trials may not demonstrate the safety or efficacy of our drug

Success in nonclinical studies and early clinical trials does not ensure that later clinical trials will be successful.

of later clinical trials may not replicate the results of prior clinical trials and nonclinical studies.

We or our collaborators may have to commit substantial

time and additional resources to conducting further nonclinical studies and clinical trials before obtaining FDA approval for any of

our drug candidates.

Before obtaining regulatory approvals for the commercial sale of any

of our product candidates, we must demonstrate through lengthy, complex and expensive non-clinical testing and clinical trials that the

product is both safe and effective for use in each target indication.

Results from early clinical trials may not support moving a drug candidate

to later-stage clinical trials.

Phase 3 clinical trials may not demonstrate the safety or efficacy of our drug candidates.

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

Results of later clinical

trials may not replicate the results of prior clinical trials and non-clinical studies.

We or our collaborators may have to commit substantial time and additional

resources to conducting further non-clinical studies and clinical trials before obtaining FDA approval for any of our drug candidates.

Clinical trials are very expensive and difficult

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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

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 candidates.

We do not know whether any of our ongoing or planned clinical trials will result in marketable drugs.

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be delayed by numerous factors, including:

delays in identifying and

agreeing on acceptable terms with prospective clinical trial sites;

slower than expected rates

of patient recruitment and enrollment;

unanticipated patient dropout

increases in time required

to complete monitoring of patients during or after participation in a clinical trial.

delays in identifying and agreeing on acceptable terms with prospective clinical trial sites;

slower than expected rates of patient recruitment and enrollment;

unanticipated patient dropout rates;

increases in time required to complete monitoring of patients during or after participation in a clinical trial.

Any of these delays could significantly impact

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is effective.

However, there is a possibility that our data may fail to show a statistically significant difference from the placebo control

or the active control.

Alternatively, there is a possibility that our data may be statistically significant, but that the actual clinical

benefit of the product candidates may not be considered to be clinically significant, clinically relevant or clinically meaningful.

if we believe that the data from our trials will support marketing approval in the United States or in Europe, we cannot predict whether

the agencies will agree with our analysis and approve our applications.

However, there is a possibility that our data may fail to show a clinically meaningful response rate or a statistically

significant difference between the product candidate and the control.

Alternatively, there is a possibility that our data may be statistically

significant, but that the actual clinical benefit of the product candidates may not be considered to be clinically significant, clinically

relevant or clinically meaningful.

Even if we believe that the data from our trials will support marketing approval in the United States

or in Europe, we cannot predict whether the agencies will agree with our analysis and approve our applications.

Developments by competitors may establish

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design could affect our ability to design and conduct clinical trials as planned.

In that case, both the cost and the amount of time

required to conduct a clinical trial could increase.

In that case, both the cost and the amount of time required

to conduct a clinical trial could increase.

Conducting clinical trials of our drug

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or regulatory review or approval process.

We have obtained Fast Track Designation for esmethadone for the adjunctive

treatment of MDD.

Fast Track Designation is granted if a drug is intended for the treatment of a serious or life-threatening condition

and the drug demonstrates the potential to address unmet medical needs for this condition.

Fast Track Designation does not guarantee a

faster development process, review or approval compared to conventional FDA procedures.

The FDA may withdraw Fast Track Designation if

it believes that the designation is no longer supported by data from our clinical development program.

Our esmethadone development program

is currently paused and under evaluation.

Even though we have obtained orphan drug

designation in the United States for esmethadone for the treatment of postherpetic neuralgia, we may not obtain or maintain orphan

drug exclusivity for that product candidate, and we may not obtain orphan drug designation or exclusivity for any of our other product

candidates or indications.

We may seek Fast Track Designation for our product candidates.

Track Designation is granted if a drug is intended for the treatment of a serious or life-threatening condition and the drug demonstrates

the potential to address unmet medical needs for this condition.

Fast Track Designation does not guarantee a faster development process,

review or approval compared to conventional FDA procedures.

The FDA may withdraw Fast Track Designation if it believes that the designation

is no longer supported by data from our clinical development program.

Even if we obtain orphan drug designation in the United States for

any of our drug product candidates, we may not obtain or maintain orphan drug exclusivity for that drug candidate, and we may not obtain

orphan drug designation or exclusivity for any of our product candidates or indications.

The FDA may designate drugs for relatively small

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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

for esmethadone for the treatment of postherpetic neuralgia, we may not be the first to obtain marketing approval for this active moiety

for the orphan-designated indication due to the uncertainties associated with developing pharmaceutical product candidates.

even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because

different drugs with different active moieties can be approved for the same condition or a drug with the same active moiety can be approved

for a different indication.

Orphan drug designation by the FDA neither shortens the development time or regulatory review time of a drug

nor gives the drug any advantage in the regulatory review or approval process.

In addition, even if we intend to seek orphan drug designation

for other product candidates or indications, we may never receive such designations or obtain orphan drug exclusivity.

Our esmethadone development program is currently paused and under evaluation.

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

Even if we receive orphan drug designation for

a product candidate, we may not be the first to obtain marketing approval for this active moiety for the orphan-designated indication

due to the uncertainties associated with developing pharmaceutical product candidates.

Further, even if we obtain orphan drug exclusivity

for a product, that exclusivity may not effectively protect the product from competition because different drugs with different active

moieties can be approved for the same condition or a drug with the same active moiety can be approved for a different indication.

drug designation by the FDA neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage

in the regulatory review or approval process.

In addition, even if we intend to seek orphan drug designation for other product candidates

or indications, we may never receive such designations or obtain orphan drug exclusivity.

We may not be able to obtain marketing

exclusivity under the Hatch-Waxman Amendments or equivalent regulatory data exclusivity protection in other jurisdictions for our products.

We intend to rely, in part, on Hatch-Waxman exclusivity

for the commercialization of our products in the United States, if approved.

The Hatch-Waxman Amendments provide marketing exclusivity

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

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

We intend to rely, in part, on Hatch-Waxman exclusivity for the commercialization

of our products in the United States, if approved.

The Hatch-Waxman Amendments provide marketing exclusivity to the first applicant to

gain approval of an NDA under specific provisions of the FDCA.

If FDA were to determine that we do not meet the requirements of an NCE,

we may not be able to obtain 5-year exclusivity for the product.

There can be no assurance that European authorities

will grant data exclusivity for esmethadone, because it does not contain a new active molecule.

Even if European data exclusivity is

granted for esmethadone, this may not protect us from direct competition.

A competitor(s) with a generic version of our product

may be able to obtain approval of its product during our product’s period of data exclusivity, by submitting a marketing authorization

application (MAA) with a less than full package of nonclinical and clinical data.

will grant data exclusivity for any of our product candidates.

Even if European data exclusivity is granted, this may not protect us from

direct competition.

A competitor(s) with a generic version of our product may be able to obtain approval of its product during our

product’s period of data exclusivity, by submitting a marketing authorization application (MAA) with a less than full package of

nonclinical and clinical data.

We may need to focus our future efforts

in new therapeutic areas where we have little or no experience.

If our drug development efforts fail, or if the

competitive landscape or investment climate for antidepressant drug development is less attractive, we may need to change the company’s

strategic focus to include development of our product candidates, or of newly acquired product candidates.

We have very limited drug

development experience in therapeutic areas other than depression and we may be unsuccessful in making this change from a depression

focused company to a company with a focus in areas other areas, or a company with a focus in multiple therapeutic areas.

Some of our product candidates contain

controlled substances, the supply of which may be limited by U.S.

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

The active ingredients in esmethadone and psilocybin

are stated in 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 manufacturing, storage, distribution, prescribing and dispensing.

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.

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 the ability to manufacture and distribute

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

Products containing controlled substances may

generate public controversy.

Opponents of these products may seek restrictions on marketing and withdrawal of any regulatory approvals.

In addition, these opponents may seek to generate negative publicity in an effort to persuade the medical community to reject these products.

Political pressures and adverse publicity could lead to delays in, and increased expenses for, and limit or restrict the introduction

and marketing of our product candidates.

Failure to comply with the CSA or DEA regulations,

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

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 as a Schedule II drug.

Upon approval, the DEA may continue to designate it as a controlled substance falling under a

DEA controlled substance schedule.

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

regulation by the DEA.

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 and

state authorities.

Schedule 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

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

requirements and restrictions involving registration, storage, security, recordkeeping and reporting.

In particular, distribution and

dispensing of Schedule II drugs are strictly controlled.

For example, all Schedule II drug prescriptions cannot be refilled and must

contain a written or electronic signature of a practitioner when presented to a pharmacy.

This high degree of regulation can result in

significant costs in order to comply with the required regulations, which may have an adverse effect on the development and commercialization

of our product candidates.

The DEA limits the availability and production

of all Schedule I and II and some Schedule III controlled substances, including esmethadone and psilocybin, through a quota system.

DEA requires substantial evidence and documentation of expected legitimate medical and scientific needs before granting quotas to manufacturers.

In future years, we may need greater amounts of controlled substances to sustain our development program, and we will need significantly

greater amounts to implement our commercialization plans if the FDA approves our proposed formulations.

Any delay or refusal by the DEA

in establishing the procurement quota or a reduction in our quota for scheduled controlled substances or a failure to increase it over

time as we anticipate could delay or stop the clinical development or commercial sale of some of our products or product candidates.

This could have a material adverse effect on our business, 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 rescheduling 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

If we determine to restart our psilocybin development program and a

future psilocybin-containing drug product is approved by FDA, and if the finished dosage form of that drug 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.

Furthermore, 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.

we determine to restart our psilocybin development program, the potential reclassification of psilocybin in the United States could create

additional regulatory burdens on our operations and negatively affect our results of operations.

If we determine to restart our psilocybin development

program, and 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.

rescheduling psilocybin may materially alter enforcement policies across many federal and state agencies, primarily FDA and DEA.

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

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 substances.

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 rescheduled 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.

The additional regulatory requirements related to ordering, storing (e.g., security) and

dispensing may also discourage some pharmacies from carrying the product.

If our drug development efforts fail, or if the competitive landscape

or investment climate for a therapeutic area is less attractive, we may need to change the company’s strategic focus to include

development of our product candidates, or of newly acquired product candidates.

We have very limited drug development experience and we

may be unsuccessful in making this change to a company with a focus in other areas, or a company with a focus in multiple therapeutic

If a supplier of an active pharmaceutical

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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.

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

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of pharmaceutical development, manufacturing or clinical testing could result in increased costs to us and delay our ability to generate

We do not know whether our pharmaceutical development,

manufacturing or clinical testing will be on time or be completed on schedule, if at all.

For example, we may encounter delays during

the manufacture of pilot scale batches including delays with our contract development or manufacturing organization, sourcing satisfactory

quantities of APIs, narcotic import and export permits, sourcing of excipients, contract disputes with our third party vendors and manufacturers,

We do not know whether our pharmaceutical development, manufacturing

or clinical testing will be on time or be completed on schedule, if at all.

For example, we may encounter delays during the manufacture

of pilot scale batches including delays with our contract development or manufacturing organization, sourcing satisfactory quantities

of APIs, narcotic import and export permits, sourcing of excipients, contract disputes with our third party vendors and manufacturers,

or failure of the product to meet specification.

Similar delays may occur a during our cGMP manufacture of the product.

Similar delays may occur during cGMP manufacture of the product.

The commencement and completion of clinical trials

can be disrupted for a variety of reasons, including difficulties in:

recruiting and enrolling

patients to participate in a clinical trial;

obtaining regulatory approval

to commence a clinical trial;

reaching agreement on acceptable

terms with prospective clinical research organizations and trial sites;

obtaining approval of the

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

manufacturing sufficient

quantities of a product candidate;

investigator fraud, including

data fabrication by clinical trial personnel;

diversion of controlled

substances by clinical trial personnel.

recruiting and enrolling patients to participate in a clinical trial;

obtaining regulatory approval to commence a clinical trial;

reaching agreement on acceptable terms with prospective clinical research organizations and trial sites;

obtaining approval of the IRB at each site selected for participation in our clinical trials;

manufacturing sufficient quantities of a product candidate;

investigator fraud, including data fabrication by clinical trial personnel;

diversion of controlled substances by clinical trial personnel.

A clinical trial may also be suspended or terminated

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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 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 any future development of esmethadone, we would have to assess

(and have previously assessed) the cardiac safety profile of esmethadone in any future Phase 3 clinical trials.

There is no assurance

that the results of any future 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, our drug candidates and any

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

Our drug candidates 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.

Methadone indicated as an

analgesic is currently subject to a REMS that strongly encourages healthcare providers to complete a REMS-compliant education program,

counsel patients and/or their caregivers on safe use, serious risks, and proper storage and disposal using the drug’s Medication

Guide, and consider other tools to improve patient, household, and community safety.

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

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lines, (ii) make greater investments in research and development, (R&D ) , and (iii) carry on larger R&D initiatives.

competitors also have greater development capabilities than we do and have substantially greater experience in undertaking nonclinical

competitors also have greater development capabilities than we do and have substantially greater experience in undertaking non-clinical

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

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the controlled use of hazardous materials and chemicals.

Although we believe that our safety procedures for using, storing, handling

and disposing of these materials comply with federal, state and local laws and regulations, we cannot completely eliminate the risk of

accidental injury or contamination from these materials.

In the event of such an accident, we could be held liable for any resulting

damages and any liability could materially adversely affect our business, financial condition and results of operations.

the federal, state and local laws and regulations governing the use, manufacture, storage, handling and disposal of hazardous or radioactive

materials and waste products may require us to incur substantial compliance costs that could materially adversely affect our business

and financial condition.

Although we believe that our safety procedures for using, storing, handling and

disposing of these materials comply with federal, state and local laws and regulations, we cannot completely eliminate the risk of accidental

injury or contamination from these materials.

In the event of such an accident, we could be held liable for any resulting damages and

any liability could materially adversely affect our business, financial condition and results of operations.

In addition, the federal,

state and local laws and regulations governing the use, manufacture, storage, handling and disposal of hazardous or radioactive materials

and waste products may require us to incur substantial compliance costs that could materially adversely affect our business and financial

We may incur substantial liabilities and

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Our inability to obtain sufficient product liability insurance at an acceptable

cost to protect against potential product liability claims could prevent or inhibit the commercialization of pharmaceutical products

we develop, alone or with corporate collaborators.

cost to protect against potential product liability claims could prevent or inhibit the commercialization of pharmaceutical products we

develop, alone or with corporate collaborators.

We currently do not carry product liability insurance.

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financial condition or results of operations.

In the ordinary course of our business, we collect,

store and transmit large amounts of confidential information, including intellectual property, proprietary business information and personal

Our internal technology systems and infrastructure, and those of our current or future third-party collaborators, service

providers, contractors and consultants are vulnerable to damage from computer viruses, unauthorized access or use resulting from malware,

natural disasters, terrorism, war and telecommunication and electrical failures, denial-of-service attacks, cyber-attacks or cyber-intrusions

over the internet, hacking, phishing and other social engineering attacks, persons inside our organizations (including employees or contractors),

loss or theft, or persons with access to systems inside our organization.

Attacks on information technology systems are increasing in

their frequency, levels of persistence, sophistication and intensity, and they are being conducted by increasingly sophisticated and

organized foreign governments, groups and individuals with a wide range of motives and expertise.

In addition to extracting or accessing

sensitive information, such attacks could include the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering

and other means to affect service reliability and threaten the security, confidentiality, integrity and availability of information.

The prevalent use of mobile devices that access sensitive information also increases the risk of data security incidents which could

lead to the loss of confidential information or other intellectual property.

While to our knowledge we have not experienced any material

system failure, accident or security breach to date, if such an event were to occur and cause interruptions in our operations or the

operations of third-party collaborators, service providers, contractors and consultants, it could result in a material disruption of

our development programs and significant reputational, financial, legal, regulatory, business or operational harm.

The costs to us to

mitigate, investigate and respond to potential security incidents, breaches, disruptions, network security problems, bugs, viruses, worms,

malicious software programs and security vulnerabilities could be significant, and while we have implemented security measures to protect

our data security and information technology systems, our efforts to address these problems may not be successful, and these problems

could result in unexpected interruptions, delays, cessation of service and other harm to our business and our competitive position.

In the ordinary course of our business, we collect, store and transmit

large amounts of confidential information, including intellectual property, proprietary business information and personal information.

Our internal technology systems and infrastructure, and those of our current or future third-party collaborators, service providers, contractors

and consultants are vulnerable to damage from computer viruses, unauthorized access or use resulting from malware, natural disasters,

terrorism, war and telecommunication and electrical failures, denial-of-service attacks, cyber-attacks or cyber-intrusions over the internet,

hacking, phishing and other social engineering attacks, persons inside our organizations (including employees or contractors), loss or

theft, or persons with access to systems inside our organization.

Attacks on information technology systems are increasing in their frequency,

levels of persistence, sophistication and intensity, and they are being conducted by increasingly sophisticated and organized foreign

governments, groups and individuals with a wide range of motives and expertise.

Threat actors are increasingly leveraging artificial intelligence

and automation to enhance the scale, speed, and effectiveness of these attacks, making them more difficult to detect and prevent.

to extracting or accessing sensitive information, such attacks could include the deployment of harmful malware, ransomware, denial-of-service

attacks, social engineering and other means to affect service reliability and threaten the security, confidentiality, integrity and availability

of information.

The prevalent use of mobile devices that access sensitive information also increases the risk of data security incidents

which could lead to the loss of confidential information or other intellectual property.

Cybersecurity incidents affecting these third

parties, or failures in their security controls, could result in unauthorized access to or disclosure of our data, service interruptions,

or loss of system functionality, even if our own systems are not directly compromised.

Our ability to monitor and mitigate risks associated

with third-party providers may be limited.

While to our knowledge we have not experienced any material system failure, accident or security

breach to date, if such an event were to occur and cause interruptions in our operations or the operations of third-party collaborators,

service providers, contractors and consultants, it could result in the loss, theft, or unauthorized disclosure of sensitive or personal

information, disruption of our operations, degradation of system performance, and a material disruption of our development programs and

significant reputational, financial, legal, regulatory, litigation, business or operational harm, and significant remediation costs.

costs to us to mitigate, investigate and respond to potential security incidents, breaches, disruptions, network security problems, bugs,

viruses, worms, malicious software programs and security vulnerabilities could be significant, and while we have implemented security

measures to protect our data security and information technology systems, our efforts to address these problems may not be successful,

and these problems could result in unexpected interruptions, delays, cessation of service and other harm to our business and our competitive

Failure to comply with existing or future

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demand for our products and services and make it more difficult to meet expectations of or commitments to customers or partners.

In addition, HIPAA mandates that the Secretary

of HHS conduct periodic compliance audits of HIPAA covered entities and business associates for compliance with the HIPAA privacy and

security rules.

HIPAA further requires that patients be notified

of any unauthorized acquisition, access, use or disclosure of their unsecured PHI that compromises the privacy or security of such information,

with certain exceptions related to unintentional or inadvertent use or disclosure by employees or authorized individuals.

HIPAA requires

such notifications to be made “without unreasonable delay and in no case later than 60 calendar days after discovery of the breach.”

If a breach affects 500 patients or more, it must be reported to HHS without unreasonable delay, and HHS will post the name of the breaching

entity on its public web site.

Breaches affecting 500 patients or more in the same state or jurisdiction must also be reported to the

If a breach involves fewer than 500 people, the covered entity must record it in a log and notify HHS at least annually.

In addition to HIPAA, numerous other federal,

state, and foreign laws and regulations protect the confidentiality, privacy, availability, integrity and security of health-related and

other personal information.

These laws and regulations in many cases are more restrictive than and may not be pre-empted by HIPAA and

its implementing rules.

These laws and regulations are often uncertain, contradictory, and subject to changed or differing interpretations,

and we expect new laws, rules and regulations regarding privacy, data protection, and to be proposed and enacted in the future.

many state attorneys general are interpreting existing federal and state consumer protection laws to impose evolving standards for the

online collection, use, dissemination and security of health-related and other personal information.

Courts may also adopt the standards

for fair information practices promulgated by the Federal Trade Commission (“FTC”), which concern consumer notice, choice,

security and access.

Consumer protection laws require us to publish statements that describe how we handle personal information and choices

individuals may have about the way we handle their personal information.

If such information that we publish is considered untrue, we

may be subject to government claims of unfair or deceptive trade practices, which could lead to significant liabilities and consequences.

Furthermore, according to the FTC, violating consumers’ privacy rights or failing to take appropriate steps to keep consumers’

personal information secure may constitute unfair acts or practices in or affecting commerce in violation of Section 5(a) of the Federal

Trade Commission Act of 1914.

International political and economic instability,

including geopolitical tensions, armed conflicts, trade restrictions, and sanctions, could disrupt our operations and adversely affect

our business and financial results.

We conduct business and maintain relationships

with suppliers and service providers in multiple countries and regions.

Our international operations and global supply chain expose us

to risks arising from political and economic instability, including changes in governments or policies, civil unrest, armed conflict,

terrorism, trade disputes, tariffs, export controls, economic sanctions, and restrictions on the movement of goods, services, capital,

or personnel.

These events may be unpredictable in timing and scope and could escalate rapidly.

Geopolitical developments and deteriorating diplomatic

relations among countries may result in increased regulatory scrutiny, additional compliance obligations, or sudden changes in applicable

laws and regulations, including those governing international trade, data transfers, and cross-border transactions.

Compliance with evolving

and sometimes conflicting legal regimes may increase our operating costs, limit our ability to source materials or serve customers in

certain markets, or require us to modify or suspend business activities in affected regions.

International political and economic instability

may also contribute to broader macroeconomic volatility, including inflation, currency fluctuations, reduced consumer demand, supply chain

disruptions, and constraints on access to capital or credit markets.

In addition, adverse geopolitical events could impair the financial

condition of our suppliers or other counterparties, increasing the risk of non-performance or default.

If we are unable to anticipate or effectively

respond to international political and economic developments, or if such events materially disrupt our operations or supply chain, our

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

Our operations and relationships with future

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violate it in order to have committed a violation;

federal false claims laws,

including the federal False Claims Act, imposes criminal and civil penalties, including through civil whistleblower or qui tam actions,

against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, claims for payment

that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal

In addition, the government may assert that a claim including items or services resulting from a violation of the U.S.

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

federal false claims laws, including the federal False Claims Act,

imposes criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly

presenting, or causing to be presented, to the federal government, claims for payment that are false or fraudulent or making a false statement

to avoid, decrease or conceal an obligation to pay money to the federal government.

In addition, the government may assert that a claim

including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for

purposes of the civil False Claims Act;

HIPAA, as amended by HITECH,

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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 or drug pricing.

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 or drug pricing.

Efforts to ensure that our business arrangements

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our operations.

If any of the physicians or other healthcare providers or entities with whom we expect to do business is found to be

not in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from

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.

If any of the physicians or other healthcare providers or entities with whom we expect to do business is found to be not

in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government-funded

healthcare programs.

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

third-party payment for our product candidates.

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,

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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.

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, there have been and continue to be a number of initiatives

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

of these initiatives culminated in the enactment of the IRA in August 2022, which, among other things, requires HHS to directly negotiate

the selling price of a statutorily specified number of drugs and biologics each year that CMS reimburses under Medicare Part B and Part

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Only high-expenditure single-source drug that have been approved for

at least 7 years (11 years for single-source biologics) can be selected by CMS for negotiation, with the negotiated price taking effect

two years after the selection year.

For 2026, the first year in which negotiated prices become effective, CMS selected 10 high-cost Medicare

Part D products in 2023, negotiations began in 2024, and the negotiated maximum fair price for each product has been announced.

selected 15 additional Medicare Part D drugs for negotiated maximum fair pricing in 2027.

For 2028, an additional 15 drugs, which may

be covered under either Medicare Part B or Part D, will be selected, and for 2029 and subsequent years, 20 Part B or Part D drugs will

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 negotiation.

imposes rebates on Medicare Part D and Part B drugs whose prices have increased at a rate greater than the rate of inflation and in November

2024, CMS finalized regulations for these inflation rebates.

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

limit, and 20% once the out-of-pocket limit 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 be implemented, it will likely have a significant impact on the pharmaceutical industry.

at least 7 years (11 years for single-source biologics) are eligible be selected by CMS for negotiation, with the negotiated price taking

effect two years after the selection year.

For 2026, the first year in which negotiated prices become effective, CMS selected 10 high-cost

Medicare Part D products in 2023, negotiations began in 2024, and the negotiated maximum fair price for each product has been announced.

In addition, CMS has selected and announced the negotiates maximum fair pricing for 15 additional Medicare Part D drugs, which will become

effective in 2027.

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

time, drugs payable under Medicare Part B.

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

Currently, 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 negotiation.

However, as a result of

a statutory amendment enacted in July 2025, beginning with the 2028 negotiated price applicability year, a drug may be designated for

more than one rare disease or condition and still be excluded from price negotiation, as long as the only approved indications are for

such rare diseases or conditions.

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 and in November 2024, CMS finalized regulations for these inflation rebates.

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 limit, and 20% once the out-of-pocket limit has been reached.

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 may be subject to legal

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 be implemented,

it will likely have a significant impact on the pharmaceutical industry.

The current administration is pursuing policies

to reduce regulations and expenditures across government including at HHS, which include the FDA and CMS, and related agencies.

on May 12, 2025, President Trump issued an Executive Order that, among other things, required HHS, within 30 days, to establish and communicate

to drug manufacturers most favored nation, or MFN, price targets designed to bring drug prices for American patients in line with those

in comparably developed nations.

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

a rulemaking to implement MFN pricing.

Recently, on December 23, 2025, CMS issued proposed regulations to establish, under the Center

for Medicare and Medicaid Innovation, two mandatory MFN demonstration models under Medicare Parts B and D, respectively.

If these rules

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

sold in comparator countries.

Even if we do not market drugs in such countries, we will be indirectly affected if our drugs compete with

drugs whose prices were reduced as a result of MFN pricing initiatives.

Further, at the U.S.

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depend on other parties for our manufacturing operations.

If these manufacturers fail to meet our requirements and strict regulatory

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

We do not own or operate facilities for drug

manufacturing, storage, distribution or quality testing.

We currently rely, and may continue to rely, on third-party contract manufacturers

to manufacture APIs, drug products and other components of our product candidates.

Reliance on third-party manufacturers may expose us

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

If these manufacturers fail to meet our requirements and strict regulatory requirements,

our product development and commercialization efforts may be materially harmed.

We do not own or operate facilities for drug manufacturing,

storage, distribution or quality testing.

We currently rely, and may continue to rely, on third-party contract manufacturers to manufacture

APIs, drug products and other components of our product candidates.

Reliance on third-party manufacturers may expose us to different risks

than if we were to manufacture product candidates ourselves.

The manufacturing process for a product candidate

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to market and commercialize a product candidate, an inability to meet commercial demands for our products.

Our contract manufacturers may experience manufacturing

difficulties due to resource constraints or as a result of labor disputes or unstable political environments.

If our contract manufacturers

were to encounter difficulties, our ability to provide our product candidates to patients in nonclinical and clinical trials, or to provide

product for treatment of patients once approved, would be jeopardized.

We intend to rely on third parties to conduct

our nonclinical studies and clinical trials.

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

may not be able to obtain regulatory approval for our product candidates.

We do not currently conduct nonclinical studies

or clinical trials on our own, and instead will rely on third parties, such as contract research organizations (CROs), medical institutions,

clinical investigators and contract laboratories, to assist us with our nonclinical studies and clinical trials.

Accordingly, we have

less control over the timing, quality and other aspects of nonclinical studies and clinical trials than if we conducted them on our own.

These investigators, CROs and consultants are not our employees and we will have limited control over the amount of time and resources

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.

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

careful or timely in conducting our nonclinical studies or clinical trials, resulting in the nonclinical studies or clinical trials being

delayed or unsuccessful.

If we cannot contract with acceptable third parties

on commercially reasonable terms, or at all, or if these third parties do not carry out their contractual duties, satisfy legal and regulatory

requirements for the conduct of nonclinical studies or clinical trials or meet expected deadlines, our clinical development programs

could be delayed and otherwise adversely affected.

In all events, we will be responsible for ensuring that each of our nonclinical studies

and clinical trials are conducted in accordance with the general investigational plan and protocols for the trial as well as applicable

legal and regulatory requirements.

The FDA generally requires nonclinical studies to be conducted in accordance with good laboratory

practices and clinical trials to be conducted in accordance with good clinical practices, including for designing, conducting, recording

and reporting the results of nonclinical studies and clinical trials to assure that data and reported results are credible and accurate

and that the rights, integrity and confidentiality of clinical trial participants are protected.

Our reliance on third parties that we

do not control will not relieve us of these responsibilities and requirements.

Any adverse development or delay in our nonclinical studies

or clinical trials as a result of our reliance on third parties could have a material and adverse effect on our business, financial condition,

results of operations and prospects.

Our contract manufacturers may experience manufacturing difficulties

due to resource constraints or as a result of labor disputes or unstable political environments.

If our contract manufacturers were to

encounter difficulties, our ability to provide our product candidates to patients in non-clinical and clinical trials, or to provide product

for treatment of patients once approved, would be jeopardized.

We intend to rely on third parties to conduct our non-clinical studies

and clinical trials.

If these third parties do not perform as contractually required or otherwise expected, we may not be able to obtain

regulatory approval for our product candidates.

We do not currently conduct non-clinical studies or clinical trials

on our own, and instead will rely on third parties, such as contract research organizations (CROs), medical institutions, clinical investigators

and contract laboratories, to assist us with our non-clinical studies and clinical trials.

Accordingly, we have less control over the

timing, quality and other aspects of non-clinical studies and clinical trials than if we conducted them on our own.

These investigators,

CROs and consultants are not our employees and we will have limited control over the amount of time and resources 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.

The third parties with which we may contract might not be diligent, careful or timely in

conducting our non-clinical studies or clinical trials, resulting in the non-clinical studies or clinical trials being delayed or unsuccessful.

If we cannot contract with acceptable third parties on commercially

reasonable terms, or at all, or if these third parties do not carry out their contractual duties, satisfy legal and regulatory requirements

for the conduct of non-clinical studies or clinical trials or meet expected deadlines, our clinical development programs could be delayed

and otherwise adversely affected.

In all events, we will be responsible for ensuring that each of our non-clinical studies and clinical

trials are conducted in accordance with the general investigation plan and protocols for the trial as well as applicable legal and regulatory

requirements.

The FDA generally requires non-clinical studies to be conducted in accordance with good laboratory practices and clinical

trials to be conducted in accordance with good clinical practices, including for designing, conducting, recording and reporting the results

of non-clinical studies and clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity

and confidentiality of clinical trial participants are protected.

Our reliance on third parties that we do not control will not relieve

us of these responsibilities and requirements.

Any adverse development or delay in our non-clinical studies or clinical trials as a result

of our reliance on third parties could have a material and adverse effect on our business, financial condition, results of operations

and prospects.

Risks Related to Ownership of Our Common Stock

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stock that may make it more difficult to dispose of your stock.

Our common stock is currently listed on the Nasdaq

Global Select Market under the symbol “RLMD”.

Our common stock is currently listed on the Nasdaq Capital Market under

the symbol “RLMD”.

There is a limited trading market for our common stock.

Accordingly, there

can be no assurance as to the liquidity of any markets that may develop for our common stock, the ability of holders of our common stock

to sell shares of our common stock, or the prices at which holders may be able to sell their common stock.

We are not in compliance with The Nasdaq

Stock Market $1.00 minimum bid price requirement and failure to maintain compliance with this standard could result in delisting and

adversely affect the market price and liquidity of our common stock.

Our common stock is currently traded on The Nasdaq

Global Select Market under the symbol “RLMD”.

If we fail to meet any of the continued listing standards of The Nasdaq Stock

Market, our common stock will be delisted from The Nasdaq Global Select Market.

These continued listing standards include specifically

enumerated criteria, such as a $1.00 minimum closing bid price.

On January 21, 2025, we received a deficiency letter from the Listing

Qualifications Department (the “Staff”) of The Nasdaq Stock Market advising that, for 30 consecutive business days preceding

the notification letter, the Company did not meet the minimum $1.00 per share bid price requirement for continued inclusion on The Nasdaq

Global Select Market.

The deficiency letter does not result in the immediate delisting of our common stock from the Nasdaq Global Select

In accordance with Nasdaq Listing Rule 5810(c)(3)(A) (the “Compliance Period Rule”), we have been provided an initial

period of 180 calendar days, or until July 21, 2025 (the “Compliance Date”), to regain compliance with the minimum bid price

If, at any time before the Compliance Date, the bid price for our common stock closes at $1.00 per share or more for a minimum

of 10 consecutive business days, as required by the Compliance Period Rule, the Staff will provide written notification to us that we

comply with the minimum bid price requirement, unless the Staff exercises its discretion to extend this 10-day period pursuant to Nasdaq

Listing Rule 5810(c)(3)(H).

While we intend to regain compliance with the

minimum bid price requirement, there can be no assurance that we will be able to maintain continued compliance with this rule or the

other listing requirements of The Nasdaq Stock Market.

If we were unable to meet these requirements, we would receive another delisting

notice from the Nasdaq Stock Market for failure to comply with one or more of the continued listing requirements.

If our common stock

were to be delisted from The Nasdaq Global Select Market, trading of our common stock most likely will be conducted in the over-the-counter

market on an electronic bulletin board established for unlisted securities such as the OTC Markets or in the “pink sheets.”

Such a downgrading in our listing market may limit our ability to make a market in our common stock and which may impact purchases or

sales of our securities.

Accordingly, there can be no assurance as to the

liquidity of any markets that may develop for our common stock, the ability of holders of our common stock to sell shares of our common

stock, or the prices at which holders may be able to sell their common stock.

Failure to maintain compliance with the continued listing standards

of The Nasdaq Stock Market could result in delisting and adversely affect the market price and liquidity of our common stock.

Our common stock is currently traded on The Nasdaq Capital Market under

the symbol “RLMD”.

If we fail to meet any of the continued listing standards of The Nasdaq Stock Market, our common stock

will be delisted from The Nasdaq Capital Market.

These continued listing standards include specifically enumerated criteria, such as a

$1.00 minimum closing bid price.

On January 21, 2025, we received a deficiency letter from the Listing Qualifications Department (the

“Staff”) of The Nasdaq Stock Market advising that, for 30 consecutive business days preceding the notification letter, the

Company did not meet the minimum $1.00 per share bid price requirement for continued inclusion on The Nasdaq Global Select Market.

September 15, 2025, we received written notice of compliance from Nasdaq stating that for 10 consecutive trading days the closing bid

price of our common stock had been at $1.00 per share or greater, and accordingly, the Company regained compliance with Nasdaq Listing

While we intend to maintain compliance with the minimum bid price and

other listing requirements of The Nasdaq Stock Market, there can be no assurance that we will be able to maintain continued compliance

with these rules.

If we were unable to meet these requirements, we would receive another delisting notice from the Nasdaq Stock Market

for failure to comply with one or more of the continued listing requirements.

If our common stock were to be delisted from The Nasdaq

Capital Market, trading of our common stock most likely will be conducted in the over-the-counter market on an electronic bulletin board

established for unlisted securities such as the OTC Markets or in the “pink sheets.” Such a downgrade in our listing market

may limit our ability to make a market in our common stock and which may impact purchases or sales of our securities.

A sale of a substantial number of shares

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as amended (the Securities Act).

We have registered under separate registration statements in aggregate up to 21,041,717 shares of our

common stock for sale into the public market by certain selling stockholders named therein.

These shares represent a large number of

shares of our common stock, and if sold in the market all at once or at about the same time, could depress the market price of our common

stock during the period the registration statement remains effective and could also affect our ability to raise equity capital.

We are subject to the reporting requirements

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if we remained privately held.

It may be time-consuming, difficult and costly

for us to develop and implement the internal controls and reporting procedures required by the Sarbanes-Oxley Act.

We may need to hire

additional financial reporting, internal controls and other finance personnel in order to develop and implement appropriate internal

controls and reporting procedures.

If we are unable to comply with the internal controls requirements of the Sarbanes-Oxley Act, then

we may not be able to obtain the independent accountant certifications required by such act, which may preclude us from keeping our filings

with the SEC current.

It may be time-consuming, difficult and costly for us to develop and

implement the internal controls and reporting procedures required by the Sarbanes-Oxley Act.

We may need to hire additional financial

reporting, internal controls and other finance personnel in order to develop and implement appropriate internal controls and reporting

If we are unable to comply with the internal controls requirements of the Sarbanes-Oxley Act, then we may not be able to obtain

the independent accountant certifications required by such act, which may prevent us from keeping our filings with the SEC current.

If we fail to establish and maintain an

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common stock.

Effective internal control is necessary for us

to provide reliable financial reports and prevent fraud.

If we cannot provide reliable financial reports or prevent fraud, we may not

be able to manage our business as effectively as we would if an effective control environment existed, and our business and reputation

with investors may be harmed.

As a result, our small size and any undiscovered current internal control deficiencies may adversely affect

our financial condition, results of operation and access to capital.

We have not performed an in-depth analysis to determine if historical

un-discovered failures of internal controls exist and may in the future discover areas of our internal control that need improvement.

addition, as a smaller reporting company, our independent registered public accounting firm is not required to formally attest to the

effectiveness of our internal control over financial reporting so long as we remain a smaller reporting company, which could increase

the likelihood of undiscovered errors in our internal controls or reported financial statements as compared to issuers whose independent

registered public accounting firms have provided such attestations.

Effective internal control is necessary for us to provide reliable

financial reports and prevent fraud.

If we cannot provide reliable financial reports or prevent fraud, we may not be able to manage our

business as effectively as we would if an effective control environment existed, and our business and reputation with investors may be

As a result, our small size and any undiscovered current internal control deficiencies may adversely affect our financial condition,

results of operation and access to capital.

We have not performed an in-depth analysis to determine if historical undiscovered failures

of internal controls exist and may in the future discover areas of our internal control that need improvement.

In addition, as a

smaller reporting company, our independent registered public accounting firm is not required to formally attest to the effectiveness of

our internal control over financial reporting so long as we remain a smaller reporting company, which could increase the likelihood of

undiscovered errors in our internal controls or reported financial statements as compared to issuers whose independent registered public

accounting firms have provided such attestations.

Our stock price may be volatile.

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Recent Developments

The pause of our primary drug candidate and our shift to new development

programs may contribute to significant volatility in the price of our common stock.

Negative perceptions of our strategic pivot, combined

with uncertainties surrounding the new drug candidates’ potential, could lead to sharp declines in our stock price.

The termination of development of our former drug candidates and our

shift to new development programs may contribute to significant volatility in the price of our common stock.

Negative perceptions of our

strategic pivot, combined with uncertainties surrounding the new drug candidates’ potential, could lead to sharp declines in our

The Nevada Revised Statutes and our articles

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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