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Item 1A. Risk Factors

2023-03-31 compared with 2022-03-31 · 1508 added, 1373 removed, 79 unchanged (97% of the section changed)

RISK FACTORS.

investment in our common stock involves a high degree of risk.

You should carefully consider the following risk factors and the other

information in this Annual Report on Form 10-K before investing in our common stock.

Our business and results of operations could be

seriously harmed by any of the following risks.

An investment in our common stock involves

a high degree of risk.

You should carefully consider the following risk factors and the other information in this Annual Report on Form

10-K before investing in our common stock.

Our business and results of operations could be seriously harmed by any of the following risks.

The risks set out below are not the only risks we face.

Additional risks and uncertainties

not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition

and/or operating results.

If any of the following events occur, our business, financial condition and results of operations could be

materially adversely affected.

In such case, the value and trading price of our common stock could decline, and you may lose all or part

of your investment.

Related to our Financial Position and Need for Capital

have generated no revenue to date and our future profitability is uncertain.

were incorporated in August 2016 and 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 development and expansion of a new business enterprise.

Since inception,

we have incurred losses and expect to continue to operate at a net loss for at least the next several years as we continue our research

and development efforts, conduct clinical trials and develop manufacturing, sales, marketing and distribution capabilities.

for the years ended December 31, 2020 and 2021 was $2.3 million and $10.0 million, and our accumulated deficit as of December 31, 2021

was $15.9 million.

There can be no assurance that the product candidates currently under development or that may be under development

by us in the future will be approved for sale in the U.S.

Additional risks and uncertainties not currently known to us or that we currently

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

If any of the

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

In such case,

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

Risks Related to our Financial Position and

Need for Capital

We have generated no revenue to date and

our future profitability is uncertain.

We were incorporated in August 2016 and 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 development and expansion of a new business enterprise.

Since inception, we have incurred losses and expect to continue

to operate at a net loss for at least the next several years as we continue our research and development efforts, conduct clinical trials

and develop manufacturing, sales, marketing and distribution capabilities.

Our net loss for the years ended December 31, 2021 and 2022

was $10.0 million and $18.1 million, and our accumulated deficit as of December 31, 2022 was $34.0 million.

There can be no assurance

that the product candidates currently under development or that may be under development by us in the future will be approved for sale

or elsewhere.

Furthermore, there can be no assurance that if such products

are approved they will be successfully commercialized, and the extent of our future losses and the timing of our profitability are highly

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

we fail to obtain the capital necessary to fund our operations, we will be unable to continue or complete our product development and

you will likely lose your entire investment.

We will need to continue to seek capital from time

to time to continue development of our product candidates.

As of December 31, 2020 and 2021, we had cash of less than $1,000 and $16.6

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

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

If we are unable to achieve profitability,

we may be unable to continue our operations.

If we fail to obtain the capital necessary

to fund our operations, we will be unable to continue or complete our product development and you will likely lose your entire investment.

We will need to continue to seek capital from

time to time to continue development of our product candidates.

As of December 31, 2021 and 2022, we had cash of $16.6 million and $0.5

million, respectively.

We expect our existing cash as of December 31, 2021 will enable us to fund our operating expenses and capital expenditure

requirements for at least 12 months from the date of this Form 10-K.

We believe that we will need to raise substantial additional

capital in the future to fund our continuing operations and the development and commercialization of our current product candidates and

future product candidates.

Our business or operations may change in a manner that would consume available funds more rapidly than anticipated

and substantial additional funding may be required to maintain operations, fund expansion, develop new or enhanced products, acquire complementary

products, businesses or technologies or otherwise respond to competitive pressures and opportunities, such as a change in the regulatory

In addition, we may need to accelerate the growth of our sales capabilities and distribution beyond what is currently envisioned,

and this would require additional capital.

However, we may not be able to secure funding when we need it or on favorable terms.

not be able to raise sufficient funds to commercialize our current and future product candidates we intend to develop.

we cannot raise adequate funds to satisfy our capital requirements, we will have to delay, scale back or eliminate our research and development

activities, clinical studies or future operations.

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

arrangements may require us to relinquish rights to certain technologies or products that we otherwise would not consider relinquishing,

including rights to future product candidates or certain major geographic markets.

This could result in sharing revenues which we might

otherwise retain for ourselves.

On March 3, 2023, the Company signed a securities purchase agreement with certain healthcare-focused institutional

investors that will provide up to $130 million in gross proceeds to Unicycive through a private placement that included initial upfront

funding of $30 million.

We expect our existing cash as of December 31, 2022 plus the funding received in March 2023 will enable us to

fund our operating expenses and capital expenditure requirements for at least 12 months from the date of this Form 10-K.

that we will need to raise substantial additional capital in the future to fund our continuing operations and the development and commercialization

of our current product candidates and future product candidates.

Our business or operations may change in a manner that would consume

available funds more rapidly than anticipated and substantial additional funding may be required to maintain operations, fund expansion,

develop new or enhanced products, acquire complementary products, businesses or technologies or otherwise respond to competitive pressures

and opportunities, such as a change in the regulatory environment.

In addition, we may need to accelerate the growth of our sales capabilities

and distribution beyond what is currently envisioned, and this would require additional capital.

However, we may not be able to secure

funding when we need it or on favorable terms.

We may not be able to raise sufficient funds to commercialize our current and future product

candidates we intend to develop.

If we cannot raise adequate funds to satisfy

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

future operations.

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

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

product candidates or certain major geographic markets.

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

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

amount of capital we may need depends on many factors, including the progress, timing and scope of our product development programs;

the progress, timing and scope of our pre-clinical studies and clinical trials;

The amount of capital we may need depends on

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

the progress, timing and scope of our pre-clinical

studies and clinical trials;

the time and cost necessary to obtain regulatory approvals;

the time and cost necessary to further develop manufacturing processes and arrange for contract manufacturing;

our ability to enter into

and maintain collaborative, licensing and other commercial relationships;

and our partners’ commitment of time and resources to

the development and commercialization of our products.

may consider strategic alternatives in order to maximize stockholder value, including financings, strategic alliances, acquisitions or

the possible sale of our business.

the time and cost necessary to further develop

manufacturing processes and arrange for contract manufacturing;

our ability to enter into and maintain collaborative, licensing and other

commercial relationships;

and our partners’ commitment of time and resources to the development and commercialization of our products.

We may consider strategic alternatives

in order to maximize stockholder value, including financings, strategic alliances, acquisitions or the possible sale of our business.

We may not be able to identify or consummate any suitable strategic alternatives.

may consider all strategic alternatives that may be available to us to maximize stockholder value, including financings, strategic alliances,

acquisitions or the possible sale of our business.

We currently have no agreements or commitments to engage in any specific strategic

transactions, and our exploration of various strategic alternatives may not result in any specific action or transaction.

To the extent

that this engagement results in a transaction, our business objectives may change depending upon the nature of the transaction.

can be no assurance that we will enter into any transaction as a result of the engagement.

Furthermore, if we determine to engage in

a strategic transaction, we cannot predict the impact that such strategic transaction might have on our operations or stock price.

also cannot predict the impact on our stock price if we fail to enter into a transaction.

additional capital may cause dilution to our existing stockholders, restrict our operations or require us to relinquish rights to our

product candidates on unfavorable terms to us.

may seek additional capital through a variety of means, including through private and public equity offerings and debt financings, collaborations,

strategic alliances and marketing, distribution or licensing arrangements.

To the extent that we raise additional capital through the

sale of equity or convertible debt securities, or through the issuance of shares under management or other types of contracts, or upon

the exercise or conversion of outstanding derivative securities, the ownership interests of our stockholders will be diluted, and the

terms of such financings may include liquidation or other preferences, anti-dilution rights, conversion and exercise price adjustments

and other provisions that adversely affect the rights of our stockholders, including rights, preferences and privileges that are senior

to those of our holders of common stock in the event of a liquidation.

In addition, debt financing, if available, could include covenants

limiting or restricting our ability to take certain actions, such as incurring additional debt, making capital expenditures, entering

into licensing arrangements, or declaring dividends and may require us to grant security interests in our assets.

If we raise additional

funds through collaborations, strategic alliances, or marketing, distribution or licensing arrangements with third parties, we may have

to relinquish valuable rights to our technologies, future revenue streams, product or product candidates or grant licenses on terms that

may not be favorable to us.

If we are unable to raise additional funds through equity or debt financings when needed, we may need to

curtail or cease our operations.

Related to Our Business

marketing approval process of the FDA is lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain

marketing approval for our current product candidates and future product candidates we intend to develop, our business will be substantially

product candidates we intend to develop have not gained marketing approval in the U.S., and we cannot guarantee that we will ever have

marketable products.

Our business is substantially dependent on our ability to complete the development of, obtain marketing approval

for, and successfully commercialize our current and future product candidates in a timely manner.

We cannot commercialize our product

candidates in the United States without first obtaining approval from the FDA to market each product candidate.

Our product candidates

could fail to receive marketing approval for many reasons, including among others:

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

FDA could determine that we cannot rely on Section 505(b)(2) for our current or future product

FDA may determine that we have identified the wrong reference listed drug or drugs or that

approval of our Section 505(b)(2) application for any of our product candidates is blocked

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

addition, the process of seeking regulatory clearance or approval to market the product candidates we intend to develop is expensive

and time consuming and, notwithstanding the effort and expense incurred, clearance or approval is never guaranteed.

If we are not successful

in obtaining timely clearance or approval of our product candidates from the FDA, we may never be able to generate significant revenue

and may be forced to cease operations.

The NDA process is costly, lengthy and uncertain.

Any NDA application filed by us will have to

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

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

clearances or approvals from the FDA and from the regulatory agencies in other countries is an expensive and time-consuming process and

is uncertain as to outcome.

The FDA and other agencies could ask us to supplement our submissions, collect non-clinical data, conduct

additional clinical trials or engage in other time-consuming actions, or it could simply deny our applications.

In addition, even if

we obtain an NDA approval or pre-market approvals in other countries, the approval could be revoked or other restrictions imposed if

post-market data demonstrate safety issues or lack of effectiveness.

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

We may consider all strategic alternatives that

may be available to us to maximize stockholder value, including financings, strategic alliances, acquisitions or the possible sale of

our business.

We currently have no agreements or commitments to engage in any specific strategic transactions, and our exploration of

various strategic alternatives may not result in any specific action or transaction.

To the extent that this engagement results in a

transaction, our business objectives may change depending upon the nature of the transaction.

There can be no assurance that we will

enter into any transaction as a result of the engagement.

Furthermore, if we determine to engage in a strategic transaction, we cannot

predict the impact that such strategic transaction might have on our operations or stock price.

We also cannot predict the impact on

our stock price if we fail to enter into a transaction.

Raising additional capital may cause dilution

to our existing stockholders, restrict our operations or require us to relinquish rights to our product candidates on unfavorable terms

We may seek additional capital through a variety

of means, including through private and public equity offerings and debt financings, collaborations, strategic alliances and marketing,

distribution or licensing arrangements.

To the extent that we raise additional capital through the sale of equity or convertible debt

securities, or through the issuance of shares under management or other types of contracts, or upon the exercise or conversion of outstanding

derivative securities, the ownership interests of our stockholders will be diluted, and the terms of such financings may include liquidation

or other preferences, anti-dilution rights, conversion and exercise price adjustments and other provisions that adversely affect

the rights of our stockholders, including rights, preferences and privileges that are senior to those of our holders of common stock

in the event of a liquidation.

In addition, debt financing, if available, could include covenants limiting or restricting our ability

to take certain actions, such as incurring additional debt, making capital expenditures, entering into licensing arrangements, or declaring

dividends and may require us to grant security interests in our assets.

If we raise additional funds through collaborations, strategic

alliances, or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our

technologies, future revenue streams, product or product candidates or grant licenses on terms that may not be favorable to us.

are unable to raise additional funds through equity or debt financings when needed, we may need to curtail or cease our operations.

You will experience dilution, subordination

of stockholder rights, preferences, and privileges, and decrease in market price of our common stock as a result of our private placement

in March 2023 financing efforts.

On March 3, 2023, we signed a securities

purchase agreement with certain healthcare-focused institutional investors pursuant to which we issued and sold 30,190 shares of

Series A-1 Preferred Stock.

Such Series A-1 Preferred Stock and the securities issuable upon conversion of the Series A-1 Preferred

Stock are potentially dilutive instruments and the conversion of these securities upon Stockholder Approval will result in dilution

to our existing stockholders:

As of March 30, 2023, subject to Stockholder Approval, the Series A-1 Preferred Stock will be

convertible into approximately 61,612,000 shares of common stock.

As a result, these stockholders, acting together, may have the ability to control the

outcome of matters submitted to our stockholders for approval, including the election of directors and any merger, consolidation or

sale of all or substantially all of our assets.

In addition, these stockholders, acting together, may have the ability to control

the management and affairs of our company.

Additionally, such shares of Series A-1 Preferred Stock contain certain preferences and

privileges not applicable to the shares of common stock, which are described further in the Certificate of Designation filed hereto

as Exhibit 3.4.

Our cash could be adversely impacted if

a financial institution with which we have deposits or other accounts fails.

Our cash and cash equivalents we use to satisfy

our working capital and operating expense needs are held in accounts at various financial institutions.

The balance held in deposit accounts

often exceeds the Federal Deposit Insurance Corporation (“FDIC”) deposit insurance limit or similar government deposit insurance

Our cash and cash equivalents could be adversely impacted, including the loss of uninsured deposits and other uninsured financial

assets, if one or more of the financial institutions in which we hold our cash or cash equivalents fails or is subject to other adverse

conditions in the financial or credit markets.

For example, on March 10, 2023, Silicon Valley Bank was closed by the California Department

of Financial Protection and Innovation and taken into receivership by the FDIC.

At that time, substantially all of our cash and cash

equivalents were held in accounts with Silicon Valley Bank and we could not access such accounts.

While we were afforded full access

to our accounts on March 13, 2023 as a result of action taken by the U.S.

Department of the Treasury, the Federal Reserve and the FDIC

under the systemic risk exception, there is no guarantee that the system risk exception will be relied upon to provide access to uninsured

deposits and other assets in the future in the event of the closure of a financial institution, or that such access would be afforded

in a timely fashion.

Any loss of our cash or cash equivalents or any delay in our access thereto could, among other risks, adversely

impact our ability to pay our operating expenses, result in breaches of our contractual obligations, or result in violations of federal

or state wage and hour laws if we are unable to pay our employees on a timely basis.

Risks Related to Our Business

The marketing approval process of the FDA

is lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain marketing approval for our current

product candidates and future product candidates we intend to develop, our business will be substantially harmed.

The product candidates we intend to develop have

not gained marketing approval in the U.S., and we cannot guarantee that we will ever have marketable products.

Our business is substantially

dependent on our ability to complete the development of, obtain marketing approval for, and successfully commercialize our current and

future product candidates in a timely manner.

We cannot commercialize our product candidates in the United States without first obtaining

approval from the FDA to market each product candidate.

Our product candidates could face substantial delays or even fail to receive

marketing approval for many reasons, including among others:

The FDA may decide that additional CMC, nonclinical and clinical studies

would be needed for the approval of Renazorb;

the FDA may disagree with the design, implementation, or interpretation

of data of our CMC, preclinical, or clinical studies;

the FDA could determine that we cannot rely on specific regulatory

approval pathway, e.g., Section 505(b)(2), for our current or future product candidates;

the FDA may determine that we have identified the wrong reference listed

drug or drugs or that approval of our regulatory application for any of our product candidates is blocked by patent or non-patent

exclusivity of the reference listed drug or drugs.

In addition, the process of seeking regulatory

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

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

If we are not successful in obtaining timely clearance or approval

of our product candidates from the FDA, we may never be able to generate anticipated revenue and may be forced to cease operations.

NDA process is costly, lengthy and uncertain.

Any NDA application filed by us will have to be supported by extensive data, including,

but not limited to, technical, pre-clinical, clinical, manufacturing and labeling data, to demonstrate to the FDA’s satisfaction

the safety and efficacy of the product for its intended use.

Obtaining clearances or approvals from the FDA

and from the regulatory agencies in other countries is an expensive and time-consuming process and is uncertain as to outcome.

and other agencies could ask us to supplement our submissions, collect new CMC or non-clinical data, conduct additional clinical trials

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

In addition, even if we obtain an NDA approval or

pre-market approvals in other countries, the approval could be revoked or other restrictions imposed if post-market data demonstrate

safety issues or lack of effectiveness.

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

If we are unable to obtain the necessary regulatory approvals, our financial condition and cash flow may be adversely affected, and our

2 unchanged sentences

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

may encounter substantial delays in completing our clinical studies which in turn will require additional costs, or we may fail to demonstrate

adequate safety and efficacy to the satisfaction of applicable regulatory authorities.

is impossible to predict if or when our current or future product candidates, will prove safe or effective in humans or will receive

regulatory approval.

Before obtaining marketing approval from regulatory authorities for the sale of our product candidates, we must

conduct extensive clinical studies to demonstrate the safety and efficacy of the product candidates in humans.

Clinical testing is expensive,

time-consuming and uncertain as to outcome.

We cannot guarantee that any clinical studies will be conducted as planned or completed on

schedule, if at all.

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

Events that may prevent successful

or timely completion of clinical development include:

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

in reaching, or failing to reach, agreement on acceptable terms with a sufficient number

of prospective contract research organizations (“CROs”) and clinical study sites,

the terms of which can be subject to extensive negotiation and may vary significantly among

different CROs and trial sites;

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

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

or study sites;

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

requirements;

to perform in accordance with the FDA’s good clinical practices (“GCPs”)

or applicable regulatory guidelines in other countries;

in the testing, validation, manufacturing and delivery of sufficient quantities of our product

candidates to the clinical sites;

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

study sites or patients dropping out of a study;

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

● unanticipated

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

of serious adverse events associated with the product candidates that are viewed to outweigh

its potential benefits;

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

could also encounter delays if a clinical trial is suspended or terminated by us, by the Institutional Review Board (“IRB”)

or Ethics Commission (“EC”) of the institutions in which such trials are being conducted, by an independent Safety Review

Board (“SRB”) for such trial or by the FDA or other regulatory authorities.

Such authorities may suspend or terminate

a clinical trial due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements

or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or other regulatory authorities resulting

in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a

drug, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial.

inability to successfully complete pre-clinical and clinical development could result in additional costs to us or impair our ability

to generate revenues from product sales, regulatory and commercialization milestones and royalties.

In addition, if we make manufacturing

or formulation changes to our product candidates, we may need to conduct additional studies to bridge our modified product candidates

to earlier versions.

study delays could also shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow

our competitors to bring products to market before we do, which could impair our ability to successfully commercialize our product candidates.

addition, any delays in completing our clinical trials will increase our costs, slow down our product candidates’ development

and approval process and jeopardize our ability to commence product sales and generate revenues.

Any of these occurrences may significantly

harm our business, financial condition and prospects.

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

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

outcome of pre-clinical studies and early clinical trials may not be predictive of the success of later clinical trials, and interim

results of a clinical trial do not necessarily predict final results.

Further, pre-clinical and clinical data are often susceptible to

various interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in pre-clinical

studies and clinical trials have nonetheless failed to obtain marketing approval.

If the results of our clinical studies are inconclusive

or if there are safety concerns or adverse events associated with our product candidates, we may:

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

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

approval with labeling that includes significant use or distribution restrictions or safety

required to change the way the product is administered;

required to perform additional clinical studies to support approval or be subject to additional

post-marketing testing requirements;

regulatory authorities withdraw their approval of a product or impose restrictions on its

distribution in the form of a modified risk evaluation and mitigation strategy;

damage to our reputation.

Additionally,

our product candidates could potentially cause other adverse events that have not yet been predicted.

The inclusion of ill patients in

our clinical studies may result in deaths or other adverse medical events due to other therapies or medications that such patients may

As described above, any of these events could prevent us from achieving or maintaining market acceptance of our product candidates

and impair our ability to commercialize our products.

we are not able to obtain, or if there are delays in obtaining, required regulatory approvals, we will not be able to commercialize,

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

product candidates and the activities associated with its development and commercialization, including its design, testing, manufacture,

release, safety, efficacy, regulatory filings, recordkeeping, labeling, storage, approval, advertising, promotion, sale and distribution,

is subject to comprehensive regulation by the FDA and other regulatory authorities in the United States and by comparable authorities

in other countries.

For example, in order to commence clinical trials of our product candidates in the United States, we must file an

IND and obtain FDA agreement to proceed.

The FDA may place our development program on clinical hold and require further pre-clinical

testing prior to allowing our clinical trials to proceed.

must obtain marketing approval in each jurisdiction in which we market our products.

Failure to obtain marketing approval for a product

candidate will prevent us from commercializing the product candidate.

We have not submitted a marketing application or received approval

to market any of our product candidates from regulatory authorities in any jurisdiction.

We have only limited experience in filing and

supporting the applications necessary to gain marketing approvals and expect to rely on third-party CROs to assist us in this process.

Securing regulatory approval requires the submission of extensive pre-clinical and clinical data and supporting information to the various

regulatory authorities for each indication to establish the product candidate’s safety and efficacy.

Securing regulatory approval

also requires the submission of information about the product manufacturing process, testing and release and inspection of manufacturing

facilities and personnel by the relevant regulatory authority.

Our product candidates may not be effective, may be only moderately effective

or may prove to have undesirable or unintended side effects, toxicities or other characteristics that may preclude our obtaining marketing

approval or prevent or limit commercial use.

process of obtaining marketing approvals, both in the United States and elsewhere, is expensive, may take many years and can vary substantially

based upon a variety of factors, including the type, complexity and novelty of the product candidate involved.

We cannot assure you that

we will ever obtain any marketing approvals in any jurisdiction.

Changes in marketing approval policies during the development period,

changes in or the enactment of additional statutes or regulations or changes in regulatory review for each submitted product application

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

The FDA and comparable authorities in other countries have substantial

discretion in the approval process and may refuse to accept any application or may decide that our data are insufficient for approval

and require additional pre-clinical or other studies, changes in the manufacturing process or facilities or clinical trials.

approval by the FDA or an equivalent foreign authority, including the HSA, does not ensure approval by regulatory authorities in any

other countries or jurisdictions, but a failure to obtain marketing approval in one jurisdiction may adversely impact the likelihood

of approval in other jurisdictions.

In addition, varying interpretations of the data obtained from pre-clinical testing, manufacturing

and product testing and clinical trials could delay, limit or prevent marketing approval of a product candidate.

Additionally, any marketing

approval we ultimately obtain may be limited or subject to restrictions or post-approval commitments that render the approved product

not commercially viable.

Modifications

to our products may require new NDA approvals.

a particular product receives FDA approval or clearance, expanded uses or uses in new indications of our products may require additional

human clinical trials and new regulatory approvals or clearances, including additional IND and NDA submissions and premarket approvals

before we can begin clinical development, and/or prior to marketing and sales.

If the FDA requires new clearances or approvals for a

particular use or indication, we may be required to conduct additional clinical studies, which would require additional expenditures

and harm our operating results.

If the products are already being used for these new indications, we may also be subject to significant

enforcement actions.

Conducting clinical trials and obtaining clearances and approvals can be a time-consuming process, and delays in

obtaining required future clearances or approvals could adversely affect our ability to introduce new or enhanced products in a timely

manner, which in turn would harm our future growth.

delays to the completion of clinical studies may result from modifications being made to the protocol during the clinical trial, if such

modifications are warranted and/or required by the occurrences in the given trial .

modification to the protocol during a clinical trial has to be submitted to the FDA.

This could result in the delay or halt of a clinical

trial while the modification is evaluated.

In addition, depending on the quantity and nature of the changes made, the FDA could take

the position that the data generated by the clinical trial are not poolable because the same protocol was not used throughout the trial.

This might require the enrollment of additional subjects, which could result in the extension of the clinical trial and the FDA delaying

clearance or approval of a product.

Any such delay could have a material adverse effect on our business and results of operations.

can be no assurance that the data generated from our clinical trials using modified protocols will be acceptable to the FDA or other

regulatory authorities.

can be no assurance that the data generated using modified protocols will be acceptable to the FDA or other regulatory authorities or

that if future modifications during the trial are necessary, that any such modifications will be acceptable to the FDA or other regulatory

If the FDA or other regulatory authorities believe that prior approval is required for a particular modification, they can

delay or halt a clinical trial while they evaluate additional information regarding the change.

injury or death resulting from a failure of our product candidates during current or future clinical trials could also result in the

FDA or other regulatory authority delaying our clinical trials or denying or delaying clearance or approval of a product.

though an adverse event may not be the result of the failure of our product candidate, the FDA or other regulatory authority could delay

or halt a clinical trial for an indefinite period of time while an adverse event is reviewed, and likely would do so in the event of

multiple such events.

delay or termination of our current or future clinical trials as a result of the risks summarized above, including delays in obtaining

or maintaining required approvals from the FDA or other regulatory authorities, delays in patient enrollment, the failure of patients

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

adverse events during the trials, may cause an increase in costs and delays in the filing of any product submissions with the FDA or

other regulatory authorities, delay the approval and commercialization of our products or result in the failure of the clinical trial,

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

successful clinical studies may require the enrollment of large numbers of patients, and suitable patients may be difficult to identify

enrollment in clinical trials and completion of patient participation and follow-up depends on many factors, including the size of the

patient population;

the nature of the trial protocol;

the attractiveness of, or the discomforts and risks associated with, the treatments

received by enrolled subjects;

the availability of appropriate clinical trial investigators;

We may encounter substantial delays in

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

to the satisfaction of applicable regulatory authorities.

It is impossible to predict if or when our current

or future product candidates, will prove safe or effective in humans or will receive regulatory approval.

Before obtaining

marketing approval from regulatory authorities for the sale of our product candidates, we must conduct extensive clinical studies to

demonstrate the safety and efficacy of the product candidates in humans.

Clinical testing is expensive, time-consuming and uncertain

as to outcome.

We cannot guarantee that any clinical studies will be conducted as planned or completed on schedule, if at all.

of one or more clinical studies can occur at any stage of testing.

Events that may prevent successful or timely completion of clinical

development include:

delays in reaching, or failing to reach, a consensus with regulatory

agencies on study design;

delays in reaching, or failing to reach, agreement on acceptable terms

with a sufficient number of prospective contract research organizations (“CROs”) and clinical study sites, the terms

of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites;

delays in recruiting a sufficient number of suitable patients to participate

in our clinical studies;

imposition of a clinical hold by regulatory agencies, after an inspection

of our clinical study operations or study sites;

failure by our CROs, other third parties or us to adhere to clinical

study, regulatory or legal requirements;

failure to perform in accordance with the FDA’s good clinical

practices (“GCPs”) or applicable regulatory guidelines in other countries;

delays in the testing, validation, manufacturing and delivery of sufficient

quantities of our product candidates to the clinical sites;

delays in having patients complete participation in a study or return

for post-treatment follow-up;

clinical study sites or patients dropping out of a study;

delay or failure to address any patient safety concerns that arise

during the course of a trial;

unanticipated costs or increases in costs of clinical trials of our

product candidates;

occurrence of serious adverse events associated with the product candidates

that are viewed to outweigh its potential benefits;

changes in regulatory requirements and guidance that require amending

or submitting new clinical protocols.

We could also encounter delays if a clinical

trial is suspended or terminated by us, by the Institutional Review Board (“IRB”) or Ethics Commission (“EC”)

of the institutions in which such trials are being conducted, by an independent Safety Review Board (“SRB”) for such trial

or by the FDA or other regulatory authorities.

Such authorities may suspend or terminate a clinical trial due to a number of

factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection

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

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

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

Any inability to successfully complete pre-clinical

and clinical development could result in additional costs to us or impair our ability to generate revenues from product sales, regulatory

and commercialization milestones and royalties.

In addition, if we make manufacturing or formulation changes to our product candidates,

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

Clinical study delays could also shorten any

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

to market before we do, which could impair our ability to successfully commercialize our product candidates.

In addition, any delays

in completing our clinical trials will increase our costs, slow down our product candidates’ development and approval

process and jeopardize our ability to commence product sales and generate revenues.

Any of these occurrences may significantly harm our

business, financial condition and prospects.

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

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

The outcome of pre-clinical studies and early

clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily

predict final results.

Further, pre-clinical and clinical data are often susceptible to various interpretations and analyses, and many

companies that have believed their product candidates performed satisfactorily in pre-clinical studies and clinical trials have nonetheless

failed to obtain marketing approval.

If the results of our clinical studies are inconclusive or if there are safety concerns or

adverse events associated with our product candidates, we may:

be delayed in obtaining marketing approval for our product candidates,

if approved at all;

obtain approval for indications or patient populations that are not

as broad as intended or desired;

obtain approval with labeling that includes significant use or distribution

restrictions or safety warnings;

be required to change the way the product is administered;

be required to perform additional clinical studies to support approval

or be subject to additional post-marketing testing requirements;

have regulatory authorities withdraw their approval of a product or

impose restrictions on its distribution in the form of a modified risk evaluation and mitigation strategy;

experience damage to our reputation.

Additionally, our product candidates could potentially

cause other adverse events that have not yet been predicted.

The inclusion of ill patients in our clinical studies may result in deaths

or other adverse medical events due to other therapies or medications that such patients may be using.

As described above, any of these

events could prevent us from achieving or maintaining market acceptance of our product candidates and impair our ability to commercialize

our products.

If we are not able to obtain, or if there

are delays in obtaining, required regulatory approvals, we will not be able to commercialize, or will be delayed in commercializing,

our product candidates and our ability to generate revenue will be impaired.

Our product candidates and the activities associated

with its development and commercialization, including its design, testing, manufacture, release, safety, efficacy, regulatory filings,

recordkeeping, labeling, storage, approval, advertising, promotion, sale and distribution, is subject to comprehensive regulation by

the FDA and other regulatory authorities in the United States and by comparable authorities in other countries.

For example, in order

to commence clinical trials of our product candidates in the United States, we must file an IND and obtain FDA agreement to proceed.

The FDA may place our development program on clinical hold and require further pre-clinical testing prior to allowing our clinical trials

We must obtain marketing approval in each jurisdiction

in which we market our products.

Failure to obtain marketing approval for a product candidate will prevent us from commercializing the

product candidate.

We have not submitted a marketing application or received approval to market any of our product candidates from regulatory

authorities in any jurisdiction.

We have only limited experience in filing and supporting the applications necessary to gain marketing

approvals and expect to rely on third-party CROs to assist us in this process.

Securing regulatory approval requires the submission of

extensive pre-clinical and clinical data and supporting information to the various regulatory authorities for each indication to establish

the product candidate’s safety and efficacy.

Securing regulatory approval also requires the submission of information about the

product manufacturing process, testing and release and inspection of manufacturing facilities and personnel by the relevant regulatory

Our product candidates may not be effective, may be only moderately effective or may prove to have undesirable or unintended

side effects, toxicities or other characteristics that may preclude our obtaining marketing approval or prevent or limit commercial use.

The process of obtaining marketing approvals,

both in the United States and elsewhere, is expensive, may take many years and can vary substantially based upon a variety of factors,

including the type, complexity and novelty of the product candidate involved.

We cannot assure you that we will ever obtain any marketing

approvals in any jurisdiction.

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

statutes or regulations or changes in regulatory review for each submitted product application may cause delays in the approval or rejection

of an application.

The FDA and comparable authorities in other countries have substantial discretion in the approval process and may

refuse to accept any application or may decide that our data are insufficient for approval and require additional pre-clinical or other

studies, changes in the manufacturing process or facilities or clinical trials.

Moreover, approval by the FDA or an equivalent foreign

authority, including the HSA, does not ensure approval by regulatory authorities in any other countries or jurisdictions, but a failure

to obtain marketing approval in one jurisdiction may adversely impact the likelihood of approval in other jurisdictions.

varying interpretations of the data obtained from pre-clinical testing, manufacturing and product testing and clinical trials could delay,

limit or prevent marketing approval of a product candidate.

Additionally, any marketing approval we ultimately obtain may be limited

or subject to restrictions or post-approval commitments that render the approved product not commercially viable.

Modifications to our products may require

new NDA approvals.

Once a particular product receives FDA approval

or clearance, expanded uses or uses in new indications of our products may require additional human clinical trials and new regulatory

approvals or clearances, including additional IND and NDA submissions and premarket approvals before we can begin clinical development,

and/or prior to marketing and sales.

If the FDA requires new clearances or approvals for a particular use or indication, we may be required

to conduct additional clinical studies, which would require additional expenditures and harm our operating results.

If the products are

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

Conducting clinical trials and

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

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

Additional delays to the completion of

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

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

Each modification to the protocol during a clinical

trial has to be submitted to the FDA.

This could result in the delay or halt of a clinical trial while the modification is evaluated.

In addition, depending on the quantity and nature of the changes made, the FDA could take the position that the data generated by the

clinical trial are not poolable because the same protocol was not used throughout the trial.

This might require the enrollment of additional

subjects, which could result in the extension of the clinical trial and the FDA delaying clearance or approval of a product.

delay could have a material adverse effect on our business and results of operations.

There can be no assurance that the data

generated from our clinical trials using modified protocols will be acceptable to the FDA or other regulatory authorities.

There can be no assurance that the data generated

using modified protocols will be acceptable to the FDA or other regulatory authorities or that if future modifications during the trial

are necessary, that any such modifications will be acceptable to the FDA or other regulatory authorities.

If the FDA or other regulatory

authorities believe that prior approval is required for a particular modification, they can delay or halt a clinical trial while they

evaluate additional information regarding the change.

Serious injury or death resulting from a failure

of our product candidates during current or future clinical trials could also result in the FDA or other regulatory authority delaying

our clinical trials or denying or delaying clearance or approval of a product.

Even though an adverse event may not be the result

of the failure of our product candidate, the FDA or other regulatory authority could delay or halt a clinical trial for an indefinite

period of time while an adverse event is reviewed, and likely would do so in the event of multiple such events.

Any delay or termination of our current or future

clinical trials as a result of the risks summarized above, including delays in obtaining or maintaining required approvals from the FDA

or other regulatory authorities, delays in patient enrollment, the failure of patients to continue to participate in a clinical trial,

and delays or termination of clinical trials as a result of protocol modifications or adverse events during the trials, may cause an

increase in costs and delays in the filing of any product submissions with the FDA or other regulatory authorities, delay the approval

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

results and prospects.

Conducting successful clinical studies

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

Patient enrollment in clinical trials and completion

of patient participation and follow-up depends on many factors, including the size of the patient population;

the nature of the trial

the attractiveness of, or the discomforts and risks associated with, the treatments received by enrolled subjects;

the availability

of appropriate clinical trial investigators;

support staff;

and the proximity of patients

to clinical sites and ability to comply with the eligibility and exclusion criteria for participation in the clinical trial and patient

For example, patients may be discouraged from enrolling in our clinical trials if the trial protocol requires them to undergo

extensive post-treatment procedures or follow-up to assess the safety and effectiveness of our products or if they determine that the

treatments received under the trial protocols are not attractive or involve unacceptable risks or discomforts.

Patients may also not

participate in our clinical trials if they choose to participate in contemporaneous clinical trials of competitive products.

future results of our current or future clinical trials may not support our product candidates claims or may result in the discovery

of unexpected adverse side effects.

if our clinical trials are completed as planned, we cannot be certain that their results will support our product candidates claims or

that the FDA or foreign authorities will agree with our conclusions regarding them.

Success in pre-clinical studies and early clinical

trials does not ensure that later clinical trials will be successful, and we cannot be sure that the later trials will replicate the

results of prior trials and pre-clinical studies.

The clinical trial process may fail to demonstrate that our product candidates are

safe and effective for the proposed indicated uses.

If the FDA concludes that the clinical trials for any product for which we might

seek clearance, has failed to demonstrate safety and effectiveness, we would not receive FDA clearance to market that product in the

United States for the indications sought.

addition, such an outcome could cause us to abandon a product candidate and might delay development of others.

Any delay or termination

of our clinical trials will delay the filing of any product submissions with the FDA and, ultimately, our ability to commercialize our

product candidates and generate revenues.

It is also possible that patients enrolled in clinical trials will experience adverse side

effects that are not currently part of our product candidate’s profile.

events involving our products may lead the FDA or other regulatory authorities to delay or deny clearance for our products or result

in product recalls that could harm our reputation, business and financial results.

a product receives FDA clearance or approval, the agency has the authority to require the recall of commercialized products in the event

of adverse side effects, material deficiencies or defects in design or manufacture.

The authority to require a recall must be based on

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

Manufacturers may, under

their own initiative, recall a product if any material deficiency in a product is found.

A government-mandated or voluntary recall by

us or one of our distributors could occur as a result of adverse side effects, impurities or other product contamination, manufacturing

errors, design or labeling defects or other deficiencies and issues.

Recalls of any of our products would divert managerial and financial

resources and have an adverse effect on our financial condition and results of operations.

The FDA requires that certain classifications

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

Companies are required to maintain certain records

of recalls, even if they are not reportable to the FDA.

and the proximity of patients to clinical sites and ability to comply with

the eligibility and exclusion criteria for participation in the clinical trial and patient compliance.

For example, patients may be discouraged

from enrolling in our clinical trials if the trial protocol requires them to undergo extensive post-treatment procedures or follow-up

to assess the safety and effectiveness of our products or if they determine that the treatments received under the trial protocols are

not attractive or involve unacceptable risks or discomforts.

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

to participate in contemporaneous clinical trials of competitive products.

The future results of our current or future

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

Even if our clinical trials are completed as

planned, we cannot be certain that their results will support our product candidates claims or that the FDA or foreign authorities will

agree with our conclusions regarding them.

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

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

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

If the FDA concludes that the clinical trials for any product for which we might seek clearance, has failed to demonstrate safety and

effectiveness, we would not receive FDA clearance to market that product in the United States for the indications sought.

In addition, such an outcome could cause us to

abandon a product candidate and might delay development of others.

Any delay or termination of our clinical trials will delay the filing

of any product submissions with the FDA and, ultimately, our ability to commercialize our product candidates and generate revenues.

is also possible that patients enrolled in clinical trials will experience adverse side effects that are not currently part of our product

candidate’s profile.

Adverse events involving our products may

lead the FDA or other regulatory authorities to delay or deny clearance for our products or result in product recalls that could harm

our reputation, business and financial results.

Once a product receives FDA clearance or approval,

the agency has the authority to require the recall of commercialized products in the event of adverse side effects, material deficiencies

or defects in design or manufacture.

The authority to require a recall must be based on an FDA finding that there is a reasonable probability

that the product would cause serious injury or death.

Manufacturers may, under their own initiative, recall a product if any material

deficiency in a product is found.

A government-mandated or voluntary recall by us or one of our distributors could occur as a result

of adverse side effects, impurities or other product contamination, manufacturing errors, design or labeling defects or other deficiencies

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

condition and results of operations.

The FDA requires that certain classifications of recalls be reported to FDA within ten working days

after the recall is initiated.

Companies are required to maintain certain records of recalls, even if they are not reportable to the

We may initiate voluntary recalls involving our products in the future.

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

In addition, the FDA and/or other regulatory

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

if our product candidates receive marketing approval, they may fail to achieve the degree of market acceptance by physicians, patients,

third-party payors and others in the medical community necessary for commercial success.

our product candidates receive marketing approval, they may nonetheless fail to gain sufficient market acceptance by physicians, patients,

third-party payors and others in the medical community for us to achieve commercial success.

If our product candidates do not achieve

an adequate level of acceptance, we may not generate sufficient product revenue to become profitable.

The degree of market acceptance

of our product candidates, if approved for commercial sale, will depend on a number of factors, including:

efficacy and potential advantages compared to alternative therapies;

size of the markets in the countries in which approvals are obtained;

limitations or warnings contained in any labeling approved by the FDA or other regulatory

ability to offer any approved products for sale at competitive prices;

● convenience

and ease of administration compared to alternative treatments;

willingness of the target patient population to try new therapies or dosing regimens;

willingness of physicians to prescribe these therapies;

strength of marketing and distribution support;

success of competing products and the marketing efforts of our competitors;

third-party payor coverage and adequate reimbursement;

prevalence and severity of any side effects.

if we are able to commercialize our product candidates, such products may become subject to unfavorable pricing regulations, third-party

reimbursement practices or healthcare reform initiatives, which would harm our business.

regulations that govern marketing approvals, pricing, coverage and reimbursement for new drugs vary widely from country to country.

the United States, new and future legislation may significantly change the approval requirements in ways that could involve additional

costs and cause delays in obtaining approvals.

A future recall announcement could harm our reputation with

customers and negatively affect our sales.

In addition, the FDA and/or other regulatory agencies could take enforcement action for failing

to report the recalls when they were conducted.

Even if our product candidates receive

marketing approval, they may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in

the medical community necessary for commercial success.

If our product candidates receive marketing approval,

they may nonetheless fail to gain sufficient market acceptance by physicians, patients, third-party payors and others in the medical

community for us to achieve commercial success.

If our product candidates do not achieve an adequate level of acceptance, we may not

generate sufficient product revenue to become profitable.

The degree of market acceptance of our product candidates, if approved for

commercial sale, will depend on a number of factors, including:

the efficacy and potential advantages compared to alternative therapies;

the size of the markets in the countries in which approvals are obtained;

terms, limitations or warnings contained in any labeling approved by

the FDA or other regulatory authority;

our ability to offer any approved products for sale at competitive

convenience and ease of administration compared to alternative treatments;

the willingness of the target patient population to try new therapies

or dosing regimens;

the willingness of physicians to prescribe these therapies;

the strength of marketing and distribution support;

the success of competing products and the marketing efforts of our

sufficient third-party payor coverage and adequate reimbursement;

the prevalence and severity of any side effects.

Even if we are able to commercialize our

product candidates, such products may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare

reform initiatives, which would harm our business.

The regulations that govern marketing approvals,

pricing, coverage and reimbursement for new drugs vary widely from country to country.

In the United States, new and future legislation

may significantly change the approval requirements in ways that could involve additional costs and cause delays in obtaining approvals.

Some countries require approval of the sale price of a drug before it can be marketed.

In many countries, the pricing review period begins after marketing or product-licensing approval is granted.

In some foreign markets,

prescription pharmaceutical pricing remains subject to continuing governmental control even after initial marketing approval is granted.

As a result, we might obtain marketing approval for a drug in a particular country but then be subject to price regulations that delay

its commercial launch, possibly for lengthy time periods, and negatively impact the revenue we are able to generate from the sale of

the drug in that country.

Adverse pricing limitations may hinder our ability to commercialize and generate revenue from our product candidates,

even if our product candidates obtain marketing approval.

ability to commercialize our current and any future product candidates successfully also will depend in part on the extent to which coverage

and adequate reimbursement for these products and related treatments will be available from government health programs, private health

insurers, integrated delivery networks and other third-party payors.

Third-party payors decide which medications they will pay for and

establish reimbursement levels.

A significant trend in the U.S.

In many countries, the pricing review period begins

after marketing or product-licensing approval is granted.

In some foreign markets, prescription pharmaceutical pricing remains subject

to continuing governmental control even after initial marketing approval is granted.

As a result, we might obtain marketing approval

for a drug in a particular country but then be subject to price regulations that delay its commercial launch, possibly for lengthy time

periods, and negatively impact the revenue we are able to generate from the sale of the drug in that country.

Adverse pricing limitations

may hinder our ability to commercialize and generate revenue from our product candidates, even if our product candidates obtain marketing

Our ability to commercialize our current and

any future product candidates successfully also will depend in part on the extent to which coverage and adequate reimbursement for these

products and related treatments will be available from government health programs, private health insurers, integrated delivery networks

and other third-party payors.

Third-party payors decide which medications they will pay for and establish reimbursement levels.

A significant

trend in the U.S.

healthcare industry and elsewhere is cost containment.

Government authorities

and third-party payors have attempted to control costs by limiting coverage and the amount of payment for particular medications.

Increasingly,

third-party payors are requiring that drug companies provide predetermined discounts from list prices and are challenging the prices

charged for medical products.

Coverage and reimbursement may not be available for any product that we commercialize and, if reimbursement

is available, the level of reimbursement may not be sufficient for commercial success.

Coverage and reimbursement may impact the demand

for, or the price of, any product candidate for which we obtain marketing approval.

If coverage and reimbursement is not available or

is available only to limited levels, we may not be able to successfully commercialize any product candidate for which we obtain marketing

may be significant delays in obtaining coverage and adequate reimbursement for newly approved products, and coverage may be more limited

than the purposes for which the product is approved by the FDA or similar regulatory authorities outside the United States.

eligibility for coverage and reimbursement does not imply that any product will be paid for in all cases or at a rate that covers our

costs, including research, development, manufacture, sale and distribution.

Interim reimbursement levels for new drugs, if applicable,

may also not be sufficient to cover our costs and may not be made permanent.

Coverage and reimbursement rates may vary according to the

use of the drug and the medical circumstances under which it is used may be based on reimbursement levels already set for lower cost

products or procedures or may be incorporated into existing payments for other services.

Net prices for drugs may be reduced by mandatory

discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently

restrict imports of drugs from countries where they may be sold at lower prices than in the United States.

Commercial third-party payors

often rely upon Medicare coverage policies and payment limitations in setting their own reimbursement policies.

Our inability to promptly

obtain coverage and profitable payment rates from both government-funded programs and private payors for any approved products that we

develop could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize our approved

products and our overall financial condition.

product candidate for which we obtain marketing approval could be subject to marketing restrictions or withdrawal from the market and

we may be subject to penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems with our

product candidate for which we obtain marketing approval, along with the manufacturing processes and facilities, post-approval clinical

data, labeling, advertising and promotional activities for such product, will be subject to continual requirements of and review by the

FDA and other regulatory authorities.

These requirements include submissions of promotional materials and safety and other post-marketing

information and reports, registration and listing requirements, current Good Manufacturing Practice (“cGMP”) requirements

for product facilities, quality assurance and corresponding maintenance of records and documents and requirements regarding the distribution

of samples to physicians and related recordkeeping.

Even if marketing approval of a product candidate is granted, the approval may be

subject to limitations on the indicated uses for which the product may be marketed or to the conditions of approval or contain requirements

for costly post-marketing testing and surveillance to monitor the safety or efficacy of the medicine.

The FDA closely regulates

the post-approval marketing and promotion of drugs to ensure that they are marketed only for the approved indications and in accordance

with the provisions of the approved labeling.

However, companies may share truthful and not misleading information that is otherwise

consistent with the product’s FDA approved labeling.

The FDA imposes stringent restrictions on manufacturers’ communications

regarding off-label use and if we do not comply with these restrictions, we may be subject to enforcement actions.

addition, later discovery of previously unknown problems with our products, manufacturers or manufacturing processes and facilities or

failure to comply with regulatory requirements, may result in, among other things:

● restrictions

on such products, manufacturers or manufacturing processes or facilities;

● restrictions

on the labeling, marketing, distribution or use of a product;

● requirements

to conduct post-approval clinical trials, other studies or other post-approval commitments;

or untitled letters;

or recall of the products from the market;

to approve pending applications or supplements to approved applications that we submit;

restitution or disgorgement of profits or revenue;

or withdrawal of marketing approvals;

to permit the import or export of our products;

● injunctions

or the imposition of civil or criminal penalties.

may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates

or indications that may be more profitable or for which there is a greater likelihood of success.

have limited financial resources.

As a result, we may forego or delay pursuit of opportunities with future product candidates or for

other indications that later prove to have greater commercial potential than opportunities we pursue.

Our resource allocation decisions

may cause us to fail to capitalize on viable commercial products or profitable market opportunities.

Our spending on current and future

research and development programs and product candidates for specific indications may not yield any commercially viable products.

we do not accurately evaluate the commercial potential or target markets for a particular product candidate or opportunity, we may relinquish

valuable rights to that product candidate or opportunity through collaboration, licensing or other royalty arrangements in cases in which

it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate or opportunity.

may be adversely affected by the ongoing coronavirus pandemic.

outbreak of the novel coronavirus COVID-19 (“COVID-19”) has evolved into a global pandemic.

The coronavirus has spread to

many regions of the world.

The extent to which the coronavirus impacts our business and operating results will depend on future developments

that are highly uncertain and cannot be accurately predicted, including new information that may emerge concerning the coronavirus and

the actions to contain the coronavirus or treat its impact, among others.

a result of the continuing spread of COVID-19, our business operations could be delayed or interrupted.

Currently, we operate virtually,

i.e., our program activities are and will continue to be carried out, on our behalf, by competent contract research organizations (CROs)

with expertise in pre-clinical, clinical and/or chemistry and manufacturing areas.

Due to COVID-19, our planned project timelines may

be delayed due to reduced availability of human resources or critical supplies needed to carry out such plans.

Due to shelter-in-place/stay-at-home orders

and other government restrictions, our employees conducting research and development or manufacturing activities at external vendor locations

across the globe may not be able to access their laboratory or manufacturing space which may result in our core activities being significantly

limited or curtailed, possibly for an extended period of time.

our clinical trials may be affected by the COVID-19 pandemic.

Site initiation, participant recruitment and enrollment, participant dosing,

availability and distribution of clinical trial materials, study monitoring and data analysis may be paused or delayed due to changes

in hospital or university policies, federal, state or local regulations, prioritization of hospital resources toward pandemic efforts,

or other reasons related to the COVID-19 pandemic.

If the coronavirus continues to spread, some participants and clinical investigators

may not be able to execute clinical trial protocols per the expected timelines.

The new mutations of the virus may also make it harder

for us to predict the exact impact (if any) on the progression of COVID-19 on our development programs.

For example, quarantines or other

travel limitations (whether voluntary or required) may impede participant movement, affect sponsor access to study sites, or interrupt

healthcare services, and we may be unable to conduct our clinical trials.

Further, if the spread of the COVID-19 pandemic continues and

our operations are adversely impacted, we risk a delay, default and/or nonperformance under existing agreements which may increase our

These cost increases may not be fully recoverable or adequately covered by insurance.

and deaths related to the pandemic may disrupt the United States’ healthcare and healthcare regulatory systems.

Such disruptions

could divert healthcare resources away from, or materially delay FDA review or review by other regulatory agencies and/or approval with

respect to, our clinical trials.

It is unknown how long these disruptions could continue, were they to occur.

Any elongation or de-prioritization of

our clinical trials or delay in regulatory review resulting from such disruptions could materially affect the development and study of

our product candidates.

spread of the coronavirus, which has caused a broad impact globally, including restrictions on travel and quarantine policies put into

place by businesses and governments, may have a material economic effect on our business.

While the potential economic impact brought

by and the duration of the pandemic may be difficult to assess or predict, it has already caused, and is likely to result in further,

significant disruption of global financial markets, which may reduce our ability to access capital either at all or on favorable terms.

In addition, a recession, depression or other sustained adverse market event resulting from the spread of the coronavirus could materially

and adversely affect our business and the value of our common stock.

ultimate impact of the current pandemic, or any other health epidemic, is highly uncertain and subject to change.

We do not yet know

the full extent of potential delays or impacts on our business, our clinical trials, our research programs, healthcare systems or the

global economy as a whole.

However, these effects could have a material impact on our operations, and we will continue to monitor the

situation closely.

reliance on third parties heightens the risks faced by our business.

rely on suppliers, vendors and partners for certain key aspects of our business, including support for information technology systems

and certain human resource functions.

We do not control these partners, but we depend on them in ways that may be significant to us.

If these parties fail to meet our expectations or fulfill their obligations to us, we may fail to receive the expected benefits.

if any of these third parties fails to comply with applicable laws and regulations in the course of its performance of services for us,

there is a risk that we may be held responsible for such violations as well.

This risk is particularly serious in emerging markets, where

corruption is often prevalent and where many of the third parties on which we rely do not have internal compliance resources comparable

Any such failures by third parties, in emerging markets or elsewhere, could adversely affect our business, reputation, financial

condition or results of operations.

intend to rely on third parties to conduct our clinical trials and to conduct some aspects of our research and pre-clinical testing and

those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials, research or

expect to rely on third parties, such as CROs, contract manufacturers of clinical supplies, clinical data management organizations, medical

institutions and clinical investigators, to conduct our clinical trials and to conduct some aspects of our research and pre-clinical

These third parties may terminate their engagements with us at any time.

If these third parties do not successfully carry out

their duties, meet expected deadlines or conduct our studies in accordance with regulatory requirements or our stated protocols, we will

not be able to obtain, or may be delayed in obtaining, marketing approvals for our product candidates and will not be able to, or may

be delayed in our efforts to, successfully commercialize our product candidates.

Furthermore, these third parties may also have relationships

with other entities, some of which may be our competitors.

If we are required to enter into alternative arrangements, it could delay

our product development activities.

reliance on third parties for research and development activities will reduce our control over these activities but will not relieve

us of our responsibilities.

For example, we will remain responsible for ensuring that each of our clinical trials is conducted in accordance

with the general investigational plan and protocols for the trial.

Moreover, the FDA and other international regulatory authorities require

us to comply with GCP standards for conducting, recording and reporting the results of clinical trials to assure that data and reported

results are credible and accurate and that the rights, integrity and confidentiality of trial participants are protected.

required to register ongoing clinical trials and post the results of completed clinical trials on a government-sponsored database, available

at www.clinicaltrials.gov, within certain timeframes.

Failure to do so can result in fines, adverse publicity and civil and criminal

commercialization of our products, we may be dependent on third parties to market, distribute and sell our products.

ability to receive revenues may be dependent upon the sales and marketing efforts of any future co-marketing partners and third-party

distributors.

At this time, we have not entered into an agreement with any commercialization partner and only plan to do so prior to

commercialization.

If we fail to reach an agreement with any commercialization partner, or upon reaching such an agreement that partner

fails to sell a large volume of our products, it may have a negative impact on our business, financial condition and results of operations.

have no experience manufacturing product candidates on a clinical or commercial scale and will be dependent on third parties for the

manufacture of our product candidates.

If we experience problems with any of these third parties, they could delay clinical development

or marketing approval of our product candidates or our ability to sell any approved products.

do not have any manufacturing facilities.

We expect to rely on third-party manufacturers for the manufacture of our product candidates

for clinical trials and for commercial supply of any product candidate for which we obtain marketing approval.

may be unable to establish agreements with third-party manufacturers for clinical or commercial supply on terms favorable to us, or at

Even if we are able to establish agreements with third-party manufacturers, reliance on third-party manufacturers entails additional

risks, including:

on the third party for regulatory compliance and quality assurance;

possible breach of the manufacturing agreement by the third party, including the inability

to supply sufficient quantities or to meet quality standards or timelines;

possible termination or nonrenewal of the agreement by the third party at a time that is

costly or inconvenient for us.

manufacturers may not be able to comply with U.S.

Government authorities and third-party payors have attempted

to control costs by limiting coverage and the amount of payment for particular medications.

Increasingly, third-party payors are requiring

that drug companies provide predetermined discounts from list prices and are challenging the prices charged for medical products.

and reimbursement may not be available for any product that we commercialize and, if reimbursement is available, the level of reimbursement

may not be sufficient for commercial success.

Coverage and reimbursement may impact the demand for, or the price of, any product candidate

for which we obtain marketing approval.

If coverage and reimbursement is not available or is available only to limited levels, we may

not be able to successfully commercialize any product candidate for which we obtain marketing approval.

There may be significant delays in obtaining

coverage and adequate reimbursement for newly approved products, and coverage may be more limited than the purposes for which the product

is approved by the FDA or similar regulatory authorities outside the United States.

Moreover, eligibility for coverage and reimbursement

does not imply that any product will be paid for in all cases or at a rate that covers our costs, including research, development, manufacture,

sale and distribution.

Interim reimbursement levels for new drugs, if applicable, may also not be sufficient to cover our costs and may

not be made permanent.

Coverage and reimbursement rates may vary according to the use of the drug and the medical circumstances under

which it is used may be based on reimbursement levels already set for lower cost products or procedures or may be incorporated into existing

payments for other services.

Net prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare

programs or private payors and by any future relaxation of laws that presently restrict imports of drugs from countries where they may

be sold at lower prices than in the United States.

Commercial third-party payors often rely upon Medicare coverage policies and payment

limitations in setting their own reimbursement policies.

Our inability to promptly obtain coverage and profitable payment rates from

both government-funded programs and private payors for any approved products that we develop could have a material adverse effect on

our operating results, our ability to raise capital needed to commercialize our approved products and our overall financial condition.

Any product candidate for which we obtain

marketing approval could be subject to marketing restrictions or withdrawal from the market and we may be subject to penalties if we

fail to comply with regulatory requirements or if we experience unanticipated problems with our products.

Any product candidate for which we obtain marketing

approval, along with the manufacturing processes and facilities, post-approval clinical data, labeling, advertising and promotional activities

for such product, will be subject to continual requirements of and review by the FDA and other regulatory authorities.

These requirements

include submissions of promotional materials and safety and other post-marketing information and reports, registration and listing requirements,

current Good Manufacturing Practice (“cGMP”) requirements for product facilities, quality assurance and corresponding maintenance

of records and documents and requirements regarding the distribution of samples to physicians and related recordkeeping.

Even if marketing

approval of a product candidate is granted, the approval may be subject to limitations on the indicated uses for which the product may

be marketed or to the conditions of approval or contain requirements for costly post-marketing testing and surveillance to monitor the

safety or efficacy of the medicine.

The FDA closely regulates the post-approval marketing and promotion of drugs to ensure that

they are marketed only for the approved indications and in accordance with the provisions of the approved labeling.

However, companies

may share truthful and not misleading information that is otherwise consistent with the product’s FDA approved labeling.

imposes stringent restrictions on manufacturers’ communications regarding off-label use and if we do not comply with these restrictions,

we may be subject to enforcement actions.

In addition, later discovery of previously unknown

problems with our products, manufacturers or manufacturing processes and facilities or failure to comply with regulatory requirements,

may result in, among other things:

restrictions on such products, manufacturers or manufacturing processes

or facilities;

restrictions on the labeling, marketing, distribution or use of a product;

requirements to conduct post-approval clinical trials, other studies

or other post-approval commitments;

warning or untitled letters;

withdrawal or recall of the products from the market;

refusal to approve pending applications or supplements to approved

applications that we submit;

fines, restitution or disgorgement of profits or revenue;

suspension or withdrawal of marketing approvals;

refusal to permit the import or export of our products;

product seizure;

injunctions or the imposition of civil or criminal penalties.

We may expend our limited resources to

pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable

or for which there is a greater likelihood of success.

We have limited financial resources.

we may forego or delay pursuit of opportunities with future product candidates or for other indications that later prove to have greater

commercial potential than opportunities we pursue.

Our resource allocation decisions may cause us to fail to capitalize on viable commercial

products or profitable market opportunities.

Our spending on current and future research and development programs and product candidates

for specific indications may not yield any commercially viable products.

If we do not accurately evaluate the commercial potential or

target markets for a particular product candidate or opportunity, we may relinquish valuable rights to that product candidate or opportunity

through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for us to retain

sole development and commercialization rights to such product candidate or opportunity.

We may be adversely affected by the ongoing

coronavirus pandemic.

The outbreak of the novel coronavirus (“COVID-19”)

has evolved into a global pandemic.

The extent to which COVID-19 impacts our business and operating results will depend on future developments

that are highly uncertain and cannot be accurately predicted.

Due to COVID-19, our planned project timelines may be delayed due

to reduced availability of human resources or critical supplies needed to carry out such plans.

Moreover, our clinical trials may be affected

Site initiation, participant recruitment and enrollment, participant dosing, availability and distribution of clinical trial

materials, study monitoring and data analysis may be paused or delayed due to changes in hospital or university policies, federal, state

or local regulations, prioritization of hospital resources toward pandemic efforts, or other reasons related to COVID-19.

The ultimate impact of COVID-19, or any other

health epidemic, is highly uncertain and subject to change.

We do not yet know the full extent of potential delays or impacts on our

business, our clinical trials, our research programs, healthcare systems or the global economy as a whole.

However, these effects could

have a material impact on our operations, and we will continue to monitor the situation closely.

Our reliance on third parties heightens

the risks faced by our business.

We rely on suppliers, vendors and partners for

certain key aspects of our business, including support for information technology systems and certain human resource functions.

not control these partners, but we depend on them in ways that may be significant to us.

If these parties fail to meet our expectations

or fulfill their obligations to us, we may fail to receive the expected benefits.

In addition, if any of these third parties fails to

comply with applicable laws and regulations in the course of its performance of services for us, there is a risk that we may be held

responsible for such violations as well.

This risk is particularly serious in emerging markets, where corruption is often prevalent and

where many of the third parties on which we rely do not have internal compliance resources comparable to our own.

Any such failures by

third parties, in emerging markets or elsewhere, could adversely affect our business, reputation, financial condition or results of operations.

We intend to rely on third parties to conduct

our clinical trials and to conduct some aspects of our research and pre-clinical testing and those third parties may not perform satisfactorily,

including failing to meet deadlines for the completion of such trials, research or testing.

We expect to rely on third parties, such as CROs,

contract manufacturers of clinical supplies, clinical data management organizations, medical institutions and clinical investigators,

to conduct our clinical trials and to conduct some aspects of our research and pre-clinical testing.

These third parties may terminate

their engagements with us at any time.

If these third parties do not successfully carry out their duties, meet expected deadlines or

conduct our studies in accordance with regulatory requirements or our stated protocols, we will not be able to obtain, or may be delayed

in obtaining, marketing approvals for our product candidates and will not be able to, or may be delayed in our efforts to, successfully

commercialize our product candidates.

Furthermore, these third parties may also have relationships with other entities, some of which

may be our competitors.

If we are required to enter into alternative arrangements, it could delay our product development activities.

Our reliance on third parties for research and

development activities will reduce our control over these activities but will not relieve us of our responsibilities.

For example, we

will remain responsible for ensuring that each of our clinical trials is conducted in accordance with the general investigational plan

and protocols for the trial.

Moreover, the FDA and other international regulatory authorities require us to comply with GCP standards

for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate

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

We also are required to register ongoing clinical

trials and post the results of completed clinical trials on a government-sponsored database, available at www.clinicaltrials.gov, within

certain timeframes.

Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.

Upon commercialization of our products,

we may be dependent on third parties to market, distribute and sell our products.

Our ability to receive revenues may be dependent

upon the sales and marketing efforts of any future co-marketing partners and third-party distributors.

At this time, we have not entered

into an agreement with any commercialization partner and only plan to do so prior to commercialization.

If we fail to reach an agreement

with any commercialization partner, or upon reaching such an agreement that partner fails to sell a large volume of our products, it

may have a negative impact on our business, financial condition and results of operations.

We have no experience manufacturing product

candidates on a clinical or commercial scale and will be dependent on third parties for the manufacture of our product candidates.

we experience problems with any of these third parties, they could delay clinical development or marketing approval of our product candidates

or our ability to sell any approved products.

We do not have any manufacturing facilities.

We expect to rely on third-party manufacturers for the manufacture of our product candidates for clinical trials and for commercial supply

of any product candidate for which we obtain marketing approval.

We may be unable to establish agreements with

third-party manufacturers for clinical or commercial supply on terms favorable to us, or at all.

Even if we are able to establish agreements

with third-party manufacturers, reliance on third-party manufacturers entails additional risks, including:

reliance on the third party for regulatory compliance and quality assurance;

the possible breach of the manufacturing agreement by the third party,

including the inability to supply sufficient quantities or to meet quality standards or timelines;

the possible termination or nonrenewal of the agreement by the third

party at a time that is costly or inconvenient for us.

Third-party manufacturers may not be able to

comply with U.S.

cGMPs or similar regulatory requirements outside the United States.

Our failure, or

the failure of our third-party manufacturers, to comply with cGMPs or other applicable regulations, even if such failures do not relate

specifically to our product candidates or approved products, could result in sanctions being imposed on us or the manufacturers, including

fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of product

candidates, operating restrictions and criminal prosecutions, any of which could adversely affect supplies of our product candidates

and harm our business and results of operations.

product that we develop may compete with other product candidates and products for access to these manufacturing facilities.

a limited number of manufacturers that operate under cGMPs and that might be capable of manufacturing for us.

performance failure on the part of our manufacturers, including a failure that may not relate specifically to our product candidates

or approved products, could delay clinical development or marketing approval or adversely impact our ability to generate commercial sales.

If our contract manufacturers cannot perform as agreed, we may be required to replace that manufacturer.

anticipated future dependence upon others for the manufacture of our current and future product candidates or products may adversely

affect our future profit margins and our ability to commercialize any product candidates that receive marketing approval on a timely

and competitive basis.

we expect to rely on third parties to release, label, store and distribute drug supplies for our clinical trials.

Any performance failure

on the part of these third parties, including a failure that may not relate specifically to our product candidates, could delay or otherwise

adversely impact clinical development or marketing approval of our product candidates or commercialization of our drug, producing losses

and depriving us of potential revenue.

our manufacturers and suppliers may experience difficulties related to their overall businesses and financial stability, which could

result in delays or interruptions of supply of our product candidates.

may have conflicts with our partners that could delay or prevent the development or commercialization of our current and future product

may have conflicts with our partners, such as conflicts concerning the interpretation of pre-clinical or clinical data, the achievement

of milestones, the interpretation of contractual obligations, payments for services, development obligations or the ownership of intellectual

property developed during our collaboration.

If any conflicts arise with any of our partners, such partner may act in a manner that is

adverse to our best interests.

Any such disagreement could result in one or more of the following, each of which could delay or prevent

the development or commercialization of our current and future product candidates, and in turn prevent us from generating revenues:

unwillingness on the part

of a partner to pay us milestone payments or royalties we believe are due to us under a collaboration;

uncertainty regarding ownership

of intellectual property rights arising from our collaborative activities, which could prevent us from entering into additional collaborations;

unwillingness by the partner

to cooperate in the development or manufacture of the product, including providing us with product data or materials;

unwillingness on the part

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

of the results of those activities;

initiating of litigation

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

attempts by either party

to terminate the agreement.

products will face significant competition, and if they are unable to compete successfully, our business will suffer.

current product candidates and future candidates face, and will continue to face, intense competition from large pharmaceutical companies,

as well as academic and research institutions.

Our failure, or the failure of our third-party manufacturers,

to comply with cGMPs or other applicable regulations, even if such failures do not relate specifically to our product candidates or approved

products, could result in sanctions being imposed on us or the manufacturers, including fines, injunctions, civil penalties, delays,

suspension or withdrawal of approvals, license revocation, seizures or recalls of product candidates, operating restrictions and criminal

prosecutions, any of which could adversely affect supplies of our product candidates and harm our business and results of operations.

Any product that we develop may compete with

other product candidates and products for access to these manufacturing facilities.

There are a limited number of manufacturers that

operate under cGMPs and that might be capable of manufacturing for us.

Any performance failure on the part of our manufacturers,

including a failure that may not relate specifically to our product candidates or approved products, could delay clinical development

or marketing approval or adversely impact our ability to generate commercial sales.

If our contract manufacturers cannot perform as agreed,

we may be required to replace that manufacturer.

Our anticipated future dependence upon others

for the manufacture of our current and future product candidates or products may adversely affect our future profit margins and our ability

to commercialize any product candidates that receive marketing approval on a timely and competitive basis.

Furthermore, we expect to rely on third parties

to release, label, store and distribute drug supplies for our clinical trials.

Any performance failure on the part of these third parties,

including a failure that may not relate specifically to our product candidates, could delay or otherwise adversely impact clinical development

or marketing approval of our product candidates or commercialization of our drug, producing losses and depriving us of potential revenue.

Moreover, our manufacturers and suppliers may

experience difficulties related to their overall businesses and financial stability, which could result in delays or interruptions of

supply of our product candidates.

We may have conflicts with our partners

that could delay or prevent the development or commercialization of our current and future product candidates.

We may have conflicts with our partners, such

as conflicts concerning the interpretation of pre-clinical or clinical data, the achievement of milestones, the interpretation of contractual

obligations, payments for services, development obligations or the ownership of intellectual property developed during our collaboration.

If any conflicts arise with any of our partners, such partner may act in a manner that is adverse to our best interests.

Any such disagreement

could result in one or more of the following, each of which could delay or prevent the development or commercialization of our current

and future product candidates, and in turn prevent us from generating revenues:

unwillingness on the part of a partner to pay us milestone payments

or royalties we believe are due to us under a collaboration;

uncertainty regarding ownership of intellectual property rights arising

from our collaborative activities, which could prevent us from entering into additional collaborations;

unwillingness by the partner to cooperate in the development or manufacture

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

unwillingness on the part of a partner to keep us informed regarding

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

initiating of litigation or alternative dispute resolution options

by either party to resolve the dispute;

attempts by either party to terminate the agreement.

Our products will face significant competition,

and if they are unable to compete successfully, our business will suffer.

Our current product candidates and future candidates

face, and will continue to face, intense competition from large pharmaceutical companies, as well as academic and research institutions.

We compete in an industry that is characterized by:

(i) rapid technological change, (ii)

evolving industry standards, (iii) emerging competition and (iv) new product introductions.

Our competitors have existing products and

technologies that will compete with our products and technologies and may develop and commercialize additional products and technologies

that will compete with our products and technologies.

Because several competing companies and institutions have greater financial resources

than us, they may be able to:

(i) provide broader services and product lines, (ii) make greater investments in research and development

and (iii) carry on larger research and development initiatives.

Our competitors also have greater development capabilities than we do

and have substantially greater experience in undertaking pre-clinical and clinical testing of products, obtaining regulatory approvals,

and manufacturing and marketing pharmaceutical products.

They also have greater name recognition and better access to customers than

liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we

face an inherent risk of product liability exposure related to the testing of our current product candidates or future product candidates

in human clinical trials and will face an even greater risk if we commercially sell any products that we may develop.

Product liability

claims may be brought against us by subjects enrolled in our clinical trials, patients, healthcare providers or others using, administering

or selling our product.

If we cannot successfully defend ourselves against claims that our product candidates or product caused injuries,

we could incur substantial liabilities.

(i) rapid technological change, (ii) evolving industry standards, (iii) emerging

competition and (iv) new product introductions.

Our competitors have existing products and technologies that will compete with our products

and technologies and may develop and commercialize additional products and technologies that will compete with our products and technologies.

Because several competing companies and institutions have greater financial resources than us, they may be able to:

(i) provide broader

services and product lines, (ii) make greater investments in research and development and (iii) carry on larger research and development

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

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

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

Product liability lawsuits against us could

cause us to incur substantial liabilities and to limit commercialization of any products that we may develop.

We face an inherent risk of product liability

exposure related to the testing of our current product candidates or future product candidates in human clinical trials and will face

an even greater risk if we commercially sell any products that we may develop.

Product liability claims may be brought against us by

subjects enrolled in our clinical trials, patients, healthcare providers or others using, administering or selling our product.

cannot successfully defend ourselves against claims that our product candidates or product caused injuries, we could incur substantial

Regardless of merit or eventual outcome, liability claims may result in:

decreased demand for any

product candidates or products that we may develop;

termination of clinical

trial sites or entire clinical trial programs;

injury to our reputation

and significant negative media attention;

withdrawal of clinical

trial participants;

significant costs to defend

the related litigation;

substantial monetary awards

to trial subjects or patients;

decreased demand for any product candidates or products that we may

termination of clinical trial sites or entire clinical trial programs;

injury to our reputation and significant negative media attention;

withdrawal of clinical trial participants;

significant costs to defend the related litigation;

substantial monetary awards to trial subjects or patients;

loss of revenue;

diversion of management

and scientific resources from our business operations;

the inability to commercialize

any products that we may develop.

to engaging in future clinical trials, we intend to obtain product liability insurance coverage at a level that we believe is customary

for similarly situated companies and adequate to provide us with insurance coverage for foreseeable risks;

however, we may be unable

to obtain such coverage at a reasonable cost, if at all.

If we are able to obtain product liability insurance, we may not be able to

maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may arise and such insurance

may not be adequate to cover all liabilities that we may incur.

Furthermore, we intend to expand our insurance coverage for products

to include the sale of commercial products if we obtain regulatory approval for our product candidates in development, but we may be

unable to obtain commercially reasonable product liability insurance for any products that receive regulatory approval.

Large judgments

have been awarded in class action lawsuits based on drugs that had unanticipated side effects.

A successful product liability claim

or series of claims brought against us, particularly if judgments exceed our insurance coverage, could decrease our cash and adversely

affect our business.

may engage in acquisitions that could disrupt our business, cause dilution to our stockholders or reduce our financial resources.

the future, we may enter into transactions to acquire other businesses, products or technologies.

If we do identify suitable candidates,

we may not be able to make such acquisitions on favorable terms, or at all.

Any acquisitions we make may fail to strengthen our competitive

position and these transactions may be viewed negatively by customers or investors.

We may decide to incur debt in connection with an

acquisition or issue our common stock or other equity securities to the stockholders of the acquired company, which would reduce the

percentage ownership of our existing stockholders.

We could incur losses resulting from undiscovered liabilities of the acquired business

that are not covered by the indemnification we may obtain from the seller.

In addition, we may not be able to successfully integrate

the acquired personnel, technologies and operations into our existing business in an effective, timely and non-disruptive manner.

may also divert management attention from day-to-day responsibilities, increase our expenses and reduce our cash available for operations

and other uses.

We cannot predict the number, timing or size of future acquisitions or the effect that any such transactions might have

on our operating results.

threats to our information technology infrastructure and/or our physical buildings could expose us to liability and damage our reputation

and business.

is essential to our business strategy that our technology and network infrastructure and our physical buildings remain secure and are

perceived by our customers and corporate partners to be secure.

Despite security measures, however, any network infrastructure may be

vulnerable to cyber-attacks by hackers and other security threats.

We may face cyber-attacks that attempt to penetrate our network security,

sabotage or otherwise disable our research, products and services, misappropriate our or our customers’ and partners’ proprietary

information, which may include personally identifiable information, or cause interruptions of our internal systems and services.

security measures, we also cannot guarantee security of our physical buildings.

Physical building penetration or any cyber-attacks could

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

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

Additionally,

there are a number of state, federal and international laws protecting the privacy and security of health information and personal data.

For example, the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) imposes limitations on the use

and disclosure of an individual’s healthcare information by healthcare providers, healthcare clearinghouses, and health insurance

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

HIPAA also imposes

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

healthcare providers and other covered entities.

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

privacy and security provisions of HIPAA were amended.

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

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

As amended by

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

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

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

Notification is not required under HIPAA if the health information

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

of Health and Human Services.

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

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

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

personal information.

Activities outside of the U.S.

implicate local and national data protection standards, impose additional compliance

requirements and generate additional risks of enforcement for non-compliance.

We may be required to expend significant

capital and other resources to ensure ongoing compliance with applicable privacy and data security laws, to protect against security

breaches and hackers or to alleviate problems caused by such breaches.

will need to grow the size of our organization in the future, and we may experience difficulties in managing this growth.

of December 31, 2021, we had 8 full-time employees.

We will need to grow the size of our organization in order to support our continued

development and potential commercialization of our product candidates.

As our development and commercialization plans and strategies

continue to develop, our need for additional managerial, operational, manufacturing, sales, marketing, financial and other resources

may increase.

Our management, personnel and systems currently in place may not be adequate to support this future growth.

Future growth

would impose significant added responsibilities on members of management, including:

our clinical trials effectively;

● identifying,

recruiting, maintaining, motivating and integrating additional employees;

our internal development efforts effectively while complying with our contractual obligations

to licensors, licensees, contractors and other third parties;

our managerial, development, operational, information technology, and finance systems;

our facilities.

our operations expand, we will also need to manage additional relationships with various strategic partners, suppliers and other third

Our future financial performance and our ability to commercialize our product candidates and to compete effectively will depend,

in part, on our ability to manage any future growth effectively, as well as our ability to develop a sales and marketing force when appropriate.

To that end, we must be able to manage our development efforts and pre-clinical studies and clinical trials effectively and hire, train

and integrate additional management, research and development, manufacturing, administrative and sales and marketing personnel.

to accomplish any of these tasks could prevent us from successfully growing our company.

future success depends on our ability to retain our executive officers and to attract, retain and motivate qualified personnel.

are highly dependent upon our personnel, including Dr.

diversion of management and scientific resources from our business

the inability to commercialize any products that we may develop.

Prior to engaging in future clinical trials,

we intend to obtain product liability insurance coverage at a level that we believe is customary for similarly situated companies and

adequate to provide us with insurance coverage for foreseeable risks;

however, we may be unable to obtain such coverage at a reasonable

cost, if at all.

If we are able to obtain product liability insurance, we may not be able to maintain insurance coverage at a reasonable

cost or in an amount adequate to satisfy any liability that may arise and such insurance may not be adequate to cover all liabilities

that we may incur.

Furthermore, we intend to expand our insurance coverage for products to include the sale of commercial products if

we obtain regulatory approval for our product candidates in development, but we may be unable to obtain commercially reasonable product

liability insurance for any products that receive regulatory approval.

Large judgments have been awarded in class action lawsuits

based on drugs that had unanticipated side effects.

A successful product liability claim or series of claims brought against us, particularly

if judgments exceed our insurance coverage, could decrease our cash and adversely affect our business.

We may engage in acquisitions that could

disrupt our business, cause dilution to our stockholders or reduce our financial resources.

In the future, we may enter into transactions

to acquire other businesses, products or technologies.

If we do identify suitable candidates, we may not be able to make such acquisitions

on favorable terms, or at all.

Any acquisitions we make may fail to strengthen our competitive position and these transactions may be

viewed negatively by customers or investors.

We may decide to incur debt in connection with an acquisition or issue our common stock

or other equity securities to the stockholders of the acquired company, which would reduce the percentage ownership of our existing stockholders.

We could incur losses resulting from undiscovered liabilities of the acquired business that are not covered by the indemnification we

may obtain from the seller.

In addition, we may not be able to successfully integrate the acquired personnel, technologies and operations

into our existing business in an effective, timely and non-disruptive manner.

Acquisitions may also divert management attention from

day-to-day responsibilities, increase our expenses and reduce our cash available for operations and other uses.

We cannot predict the

number, timing or size of future acquisitions or the effect that any such transactions might have on our operating results.

Security threats to our information technology

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

It is essential to our business strategy that

our technology and network infrastructure and our physical buildings remain secure and are perceived by our customers and corporate partners

to be secure.

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

security threats.

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

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

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

Despite security measures, we also cannot guarantee

security of our physical buildings.

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

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

are affected, and expose us to financial liability.

Additionally, there are a number of state, federal

and international laws protecting the privacy and security of health information and personal data.

For example, the Health Insurance

Portability and Accountability Act of 1996 (“HIPAA”) imposes limitations on the use and disclosure of an individual’s

healthcare information by healthcare providers, healthcare clearinghouses, and health insurance plans, or, collectively, covered entities,

and also grants individuals rights with respect to their health information.

HIPAA also imposes compliance obligations and corresponding

penalties for non-compliance on individuals and entities that provide services to healthcare providers and other covered entities.

As part of the American Recovery and Reinvestment Act of 2009 (“ARRA”) the privacy and security provisions of HIPAA were

ARRA also made significant increases in the penalties for improper use or disclosure of an individual’s health information

under HIPAA and extended enforcement authority to state attorneys general.

As amended by ARRA and subsequently by the final omnibus rule

adopted in 2013, HIPAA also imposes notification requirements on covered entities in the event that certain health information has been

inappropriately accessed or disclosed, notification requirements to individuals, federal regulators, and in some cases, notification

to local and national media.

Notification is not required under HIPAA if the health information that is improperly used or disclosed

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

Department of Health and Human Services.

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

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

Many state laws impose significant data security

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

Activities outside

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

risks of enforcement for non-compliance.

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

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

problems caused by such breaches.

We will need to grow the size of our organization

in the future, and we may experience difficulties in managing this growth.

As of December 31, 2022, we had 12 full-time employees.

We will need to grow the size of our organization in order to support our continued development and potential commercialization of our

product candidates.

As our development and commercialization plans and strategies continue to develop, our need for additional managerial,

operational, manufacturing, sales, marketing, financial and other resources may increase.

Our management, personnel and systems currently

in place may not be adequate to support this future growth.

Future growth would impose significant added responsibilities on members

of management, including:

managing our clinical trials effectively;

identifying, recruiting, maintaining, motivating and integrating additional

managing our internal development efforts effectively while complying

with our contractual obligations to licensors, licensees, contractors and other third parties;

improving our managerial, development, operational, information technology,

and finance systems;

expanding our facilities.

If our operations expand, we will also need to

manage additional relationships with various strategic partners, suppliers and other third parties.

Our future financial performance

and our ability to commercialize our product candidates and to compete effectively will depend, in part, on our ability to manage any

future growth effectively, as well as our ability to develop a sales and marketing force when appropriate.

To that end, we must be able

to manage our development efforts and pre-clinical studies and clinical trials effectively and hire, train and integrate additional management,

research and development, manufacturing, administrative and sales and marketing personnel.

The failure to accomplish any of these tasks

could prevent us from successfully growing our company.

Our future success depends on our ability

to retain our executive officers and to attract, retain and motivate qualified personnel.

We are highly dependent upon our personnel, including

Shalabh Gupta, our Chief Executive Officer and members of our board of directors.

The loss of Dr.

Gupta’s services could impede the achievement of our research, development and commercialization objectives.

We have not obtained, do not own, nor are we the beneficiary of, key-person life insurance.

Our future growth and success depend

on our ability to recruit, retain, manage and motivate our employees.

The loss of any member of our senior management team or the inability

to hire or retain experienced management personnel could compromise our ability to execute our business plan and harm our operating results.

Because of the specialized scientific and managerial nature of our business, we rely heavily on our ability to attract and retain qualified

scientific, technical and managerial personnel.

The competition for qualified personnel in the pharmaceutical field is intense and as

a result, we may be unable to continue to attract and retain qualified personnel necessary for the development of our business.

Chief Executive Officer, Dr.

Gupta’s services could

impede the achievement of our research, development and commercialization objectives.

We have not obtained, do not own, nor are we the

beneficiary of, key-person life insurance.

Our future growth and success depend on our ability to recruit, retain, manage and motivate

our employees.

The loss of any member of our senior management team or the inability to hire or retain experienced management personnel

could compromise our ability to execute our business plan and harm our operating results.

Because of the specialized scientific and managerial

nature of our business, we rely heavily on our ability to attract and retain qualified scientific, technical and managerial personnel.

The competition for qualified personnel in the pharmaceutical field is intense and as a result, we may be unable to continue to attract

and retain qualified personnel necessary for the development of our business.

Our Chief Executive

Shalabh Gupta, is also the Chief Executive Officer of Globavir Biosciences, Inc.

and may allocate his time to such other business thereby causing conflicts of interest in his determination as to how much time to devote

to our affairs.

Furthermore, certain members of our Board of Directors are members of the board of directors of Globavir and may allocate

their time to, among other ventures, the business of Globavir which may cause conflicts of interest with respect to their determination

as to how much time to devote to our affairs.

(“Globavir”) and may allocate

his time to such other business thereby causing conflicts of interest in his determination as to how much time to devote to our affairs.

Furthermore, certain members of our Board of Directors are members of the board of directors of Globavir and may allocate their time

to, among other ventures, the business of Globavir which may cause conflicts of interest with respect to their determination as to how

much time to devote to our affairs.

This could have a negative impact on our ability to implement our plan of operation.

Chief Executive Officer, Dr.

Shalabh Gupta, is also the Chief Executive Officer of Globavir and may not commit his full time to our affairs,

which may result in a conflict of interest in allocating his time between our business and the other business.

Similarly, certain members

of our Board of Directors are members of the board of directors of Globavir and may not commit their full time to our affairs, which

may result in a conflict of interest in allocating their time between our business and the other business.

Furthermore, neither our Chief

Executive Officer, our executive team, nor our directors are obligated to contribute any specific number of his hours per week to our

If other business affairs require our Chief Executive Officer and/or directors to devote more amounts of time to other affairs,

including the business of Globavir, it could limit their ability to devote time to our affairs and could have a negative impact

on our ability to implement our plan of operation.

funding for the FDA, the U.S.

Securities and Exchange Commission (“SEC”) and other government agencies could hinder their

ability to hire and retain key leadership and other personnel, prevent new products and services from being developed or commercialized

in a timely manner or otherwise prevent those agencies from performing normal business functions on which the operation of our business

may rely, which could negatively impact our business.

ability of the FDA to review and approve new products can be affected by a variety of factors, including government budget and funding

levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes.

Average review times at the agency have fluctuated in recent years as a result.

In addition, government funding of the SEC and other

government agencies on which our operations may rely, including those that fund research and development activities is subject to the

political process, which is inherently fluid and unpredictable.

Our Chief Executive

Shalabh Gupta, is also the Chief Executive Officer of Globavir and may not commit his full time to our affairs, which may

result in a conflict of interest in allocating his time between our business and the other business.

Similarly, certain members of our

Board of Directors are members of the board of directors of Globavir and may not commit their full time to our affairs, which may result

in a conflict of interest in allocating their time between our business and the other business.

Furthermore, neither our Chief Executive

Officer, our executive team, nor our directors are obligated to contribute any specific number of his hours per week to our affairs.

If other business affairs require our Chief Executive Officer and/or directors to devote more amounts of time to other affairs, including

the business of Globavir, it could limit their ability to devote time to our affairs and could have a negative impact on our ability

to implement our plan of operation.

Inadequate funding for the FDA, the U.S.

Securities and Exchange Commission (“SEC”) and other government agencies could hinder their ability to hire and retain key

leadership and other personnel, prevent new products and services from being developed or commercialized in a timely manner or otherwise

prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively

impact our business.

The ability of the FDA to review and approve

new products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key

personnel and accept the payment of user fees, and statutory, regulatory, and policy changes.

Average review times at the agency have

fluctuated in recent years as a result.

In addition, government funding of the SEC and other government agencies on which our operations

may rely, including those that fund research and development activities is subject to the political process, which is inherently fluid

and unpredictable.

Disruptions at the FDA and other agencies may

7 unchanged sentences

to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Further, in our operations

as a public company, future government shutdowns could impact our ability to access the public markets and obtain necessary capital in

order to properly capitalize and continue our operations.

Related to Our Intellectual Property

UNI 494 product candidate is subject to an exclusive license agreement.

If we fail to meet our obligations and the license is terminated,

we may not be able to continue to develop our product candidates.

October 1, 2017, we entered into an exclusive license agreement (the “Sphaera License Agreement”) with Sphaera Pharma Pte.

Ltd., a Singaporean pharmaceutical corporation (“Sphaera”).

Pursuant to the Sphaera License Agreement, we acquired an exclusive

royalty-bearing worldwide license to develop, make, have made, use, practice, research, distribute, lease, sell, offer for sale, license,

import or otherwise dispose of certain rights owned or controlled by Sphaera and/or any of its affiliates, related to UNI 494 (the “UNI

494 Rights”).

We also acquired a non-exclusive license to certain know-how and technology related to the UNI 494 Rights.

event that either party to the Sphaera License Agreement breaches any of its material obligations thereunder, the nonbreaching party,

at its sole option and discretion, will have the right to terminate the Sphaera License Agreement, provided that it must give the breaching

party written notice specifying the nature of the breach, amounts of certain royalties and other payments then due, if any.

The non-breaching

Party’s termination notice is effective 90 days from receipt of the written notice if the breaching party has failed to cure such

breach within the 90-day period.

If the Sphaera License Agreement were to be terminated by Sphaera due to our material breach, we would

lose a significant asset and may no longer be able to develop our product candidates, which would have a material adverse effect on our

is difficult and costly to protect our proprietary rights, and we may not be able to ensure their protection.

If our patent position

does not adequately protect our product candidates, others could compete against us more directly, which would harm our business, possibly

commercial success will depend in part on obtaining and maintaining patent protection and trade secret protection of our current product

candidates and future product candidates, the processes used to manufacture them and the methods for using them, as well as successfully

defending these patents against third-party challenges.

Our ability to stop third parties from making, using, selling, offering

to sell or importing our product candidates is dependent upon the extent to which we have rights under valid and enforceable patents

or trade secrets that cover these activities.

patent positions of biotechnology and pharmaceutical companies can be highly uncertain and involve complex legal and factual questions

for which important legal principles remain unresolved.

No consistent policy regarding the breadth of claims allowed in pharmaceutical

patents has emerged to date in the U.S.

or in foreign jurisdictions outside of the U.S.

Changes in either the patent laws or interpretations

of patent laws in the U.S.

and other countries may diminish the value of our intellectual property.

Accordingly, we cannot predict the

breadth of claims that may be enforced in the patents that may be issued from the applications we currently license or may in the future

own or license from third parties.

Further, if any patents we obtain or license are deemed invalid and unenforceable, our ability to

commercialize or license our product candidates or technology could be adversely affected.

may file patent applications covering products and technologies that are similar, identical or competitive to ours or important to our

We cannot be certain that any patent application owned by a third party will not have priority over patent applications filed

or in-licensed by us, or that we or our licensors will not be involved in interference, opposition, reexamination, review, reissue,

post grant review or invalidity proceedings before U.S.

Further, upon completion

of this offering and in our operations as a public company, future government shutdowns could impact our ability to access the public

markets and obtain necessary capital in order to properly capitalize and continue our operations.

Risks Related to Our Intellectual Property

Our UNI 494 product candidate is subject

to an exclusive license agreement.

If we fail to meet our obligations and the license is terminated, we may not be able to continue to

develop our product candidates.

On October 1, 2017, we entered into an exclusive

license agreement (the “Sphaera License Agreement”) with Sphaera Pharma Pte.

Ltd., a Singaporean pharmaceutical corporation

Pursuant to the Sphaera License Agreement, we acquired an exclusive royalty-bearing worldwide license to develop,

make, have made, use, practice, research, distribute, lease, sell, offer for sale, license, import or otherwise dispose of certain rights

owned or controlled by Sphaera and/or any of its affiliates, related to UNI 494 (the “UNI 494 Rights”).

We also acquired

a non-exclusive license to certain know-how and technology related to the UNI 494 Rights.

In the event that either party to the Sphaera

License Agreement breaches any of its material obligations thereunder, the nonbreaching party, at its sole option and discretion, will

have the right to terminate the Sphaera License Agreement, provided that it must give the breaching party written notice specifying the

nature of the breach, amounts of certain royalties and other payments then due, if any.

The non-breaching Party’s termination notice

is effective 90 days from receipt of the written notice if the breaching party has failed to cure such breach within the 90-day period.

If the Sphaera License Agreement were to be terminated by Sphaera due to our material breach, we would lose a significant asset and may

no longer be able to develop our product candidates, which would have a material adverse effect on our operations.

It is difficult and costly to protect our

proprietary rights, and we may not be able to ensure their protection.

If our patent position does not adequately protect our product

candidates, others could compete against us more directly, which would harm our business, possibly materially.

Our commercial success will depend in part on

obtaining and maintaining patent protection and trade secret protection of our current product candidates and future product candidates,

the processes used to manufacture them and the methods for using them, as well as successfully defending these patents against third-party challenges.

Our ability to stop third parties from making, using, selling, offering to sell or importing our product candidates is dependent upon

the extent to which we have rights under valid and enforceable patents or trade secrets that cover these activities.

The patent positions of biotechnology and pharmaceutical

companies can be highly uncertain and involve complex legal and factual questions for which important legal principles remain unresolved.

No consistent policy regarding the breadth of claims allowed in pharmaceutical patents has emerged to date in the U.S.

or in foreign

jurisdictions outside of the U.S.

Changes in either the patent laws or interpretations of patent laws in the U.S.

and other countries

may diminish the value of our intellectual property.

Accordingly, we cannot predict the breadth of claims that may be enforced in the

patents that may be issued from the applications we currently license or may in the future own or license from third parties.

if any patents we obtain or license are deemed invalid and unenforceable, our ability to commercialize or license our product candidates

or technology could be adversely affected.

Others may file patent applications covering

products and technologies that are similar, identical or competitive to ours or important to our business.

We cannot be certain that

any patent application owned by a third party will not have priority over patent applications filed or in-licensed by us, or that

we or our licensors will not be involved in interference, opposition, reexamination, review, reissue, post grant review or invalidity

proceedings before U.S.

patent offices.

degree of future protection for our proprietary rights is uncertain because legal means afford only limited protection and may not adequately

protect our rights or permit us to gain or keep our competitive advantage.

may be able to make compounds that are similar to our product candidates, but that are not

covered by the claims of our licensed patents;

patents that we obtain from licensing or otherwise may not provide us with any competitive

granted patents that we rely upon may be held invalid or unenforceable as a result of legal

challenges by third parties;

patents of others may have an adverse effect on our business.

we fail to comply with our obligations in the agreements under which we may license intellectual property rights from third parties or

otherwise experience disruptions to our business relationships with our licensors, we could lose rights that are important to our business.

may be required to enter into intellectual property license agreements that are important to our business.

These license agreements may

impose various diligence, milestone payment, royalty and other obligations on us.

For example, we may enter into exclusive license agreements

with various universities and research institutions, we may be required to use commercially reasonable efforts to engage in various development

and commercialization activities with respect to licensed products, and may need to satisfy specified milestone and royalty payment obligations.

If we fail to comply with any obligations under our agreements with any of these licensors, we may be subject to termination of the license

agreement in whole or in part;

increased financial obligations to our licensors or loss of exclusivity in a particular field or territory,

in which case our ability to develop or commercialize products covered by the license agreement will be impaired.

addition, disputes may arise regarding intellectual property subject to a license agreement, including:

scope of rights granted under the license agreement and other interpretation-related issues;

extent to which our technology and processes infringe on intellectual property of the licensor

that is not subject to the licensing agreement;

diligence obligations under the license agreement and what activities satisfy those obligations;

a third-party expresses interest in an area under a license that we are not pursuing,

under the terms of certain of our license agreements, we may be required to sublicense rights

in that area to a third party, and that sublicense could harm our business;

ownership of inventions and know-how resulting from the joint creation or use of intellectual

property by our licensors and us.

disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements

on acceptable terms, we may be unable to successfully develop and commercialize our product candidates.

may need to obtain licenses from third parties to advance our research or allow commercialization of our product candidates.

to obtain any of these licenses at a reasonable cost or on reasonable terms, if at all.

In that event, we would be unable to further

develop and commercialize our product candidates, which could harm our business significantly.

may infringe the intellectual property rights of others, which may prevent or delay our product development efforts and stop us from

commercializing or increase the costs of commercializing our product candidates.

success will depend in part on our ability to operate without infringing the proprietary rights of third parties.

We cannot guarantee

that our product candidates, or manufacture or use of our product candidates, will not infringe third-party patents.

a third party may claim that we are using inventions covered by the third party’s patent rights and may go to court to stop us

from engaging in our normal operations and activities, including making or selling our product candidates.

These lawsuits are costly

and could affect our results of operations and divert the attention of managerial and scientific personnel.

Some of these third parties

may be better capitalized and have more resources than us.

There is a risk that a court would decide that we are infringing the third

party’s patents and would order us to stop the activities covered by the patents.

In that event, we may not have a viable way around

the patent and may need to halt commercialization of our product candidates.

In addition, there is a risk that a court will order us

to pay the other party damages for having violated the other party’s patents.

In addition, we may be obligated to indemnify our

licensors and collaborators against certain intellectual property infringement claims brought by third parties, which could require

us to expend additional resources.

The pharmaceutical and biotechnology industries have produced a proliferation of patents, and it is

not always clear to industry participants, including us, which patents cover various types of products or methods of use.

of patents is subject to interpretation by the courts, and the interpretation is not always uniform.

we are sued for patent infringement, we would need to demonstrate that our product candidates or methods either do not infringe the patent

claims of the relevant patent or that the patent claims are invalid, and we may not be able to do this.

The degree of future protection for our proprietary

rights is uncertain because legal means afford only limited protection and may not adequately protect our rights or permit us to gain

or keep our competitive advantage.

others may be able to make compounds that are similar to our product

candidates, but that are not covered by the claims of our licensed patents;

any patents that we obtain from licensing or otherwise may not provide

us with any competitive advantages;

any granted patents that we rely upon may be held invalid or unenforceable

as a result of legal challenges by third parties;

the patents of others may have an adverse effect on our business.

If we fail to comply with our obligations

in the agreements under which we may license intellectual property rights from third parties or otherwise experience disruptions to our

business relationships with our licensors, we could lose rights that are important to our business.

We may be required to enter into intellectual

property license agreements that are important to our business.

These license agreements may impose various diligence, milestone payment,

royalty and other obligations on us.

For example, we may enter into exclusive license agreements with various universities and research

institutions, we may be required to use commercially reasonable efforts to engage in various development and commercialization activities

with respect to licensed products, and may need to satisfy specified milestone and royalty payment obligations.

If we fail to comply

with any obligations under our agreements with any of these licensors, we may be subject to termination of the license agreement in whole

increased financial obligations to our licensors or loss of exclusivity in a particular field or territory, in which case

our ability to develop or commercialize products covered by the license agreement will be impaired.

In addition, disputes may arise regarding intellectual

property subject to a license agreement, including:

the scope of rights granted under the license agreement and other interpretation-related issues;

the extent to which our technology and processes infringe on intellectual

property of the licensor that is not subject to the licensing agreement;

our diligence obligations under the license agreement and what activities

satisfy those obligations;

if a third-party expresses interest in an area under a license

that we are not pursuing, under the terms of certain of our license agreements, we may be required to sublicense rights in that area

to a third party, and that sublicense could harm our business;

the ownership of inventions and know-how resulting from the joint

creation or use of intellectual property by our licensors and us.

If disputes over intellectual property that we

have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully

develop and commercialize our product candidates.

We may need to obtain licenses from third parties

to advance our research or allow commercialization of our product candidates.

We may fail to obtain any of these licenses at a reasonable

cost or on reasonable terms, if at all.

In that event, we would be unable to further develop and commercialize our product candidates,

which could harm our business significantly.

We may infringe the intellectual property

rights of others, which may prevent or delay our product development efforts and stop us from commercializing or increase the costs of

commercializing our product candidates.

Our success will depend in part on our ability

to operate without infringing the proprietary rights of third parties.

We cannot guarantee that our product candidates, or manufacture

or use of our product candidates, will not infringe third-party patents.

Furthermore, a third party may claim that we are using

inventions covered by the third party’s patent rights and may go to court to stop us from engaging in our normal operations and

activities, including making or selling our product candidates.

These lawsuits are costly and could affect our results of operations

and divert the attention of managerial and scientific personnel.

Some of these third parties may be better capitalized and have more

resources than us.

There is a risk that a court would decide that we are infringing the third party’s patents and would order us

to stop the activities covered by the patents.

In that event, we may not have a viable way around the patent and may need to halt commercialization

of our product candidates.

In addition, there is a risk that a court will order us to pay the other party damages for having violated

the other party’s patents.

In addition, we may be obligated to indemnify our licensors and collaborators against certain intellectual

property infringement claims brought by third parties, which could require us to expend additional resources.

The pharmaceutical

and biotechnology industries have produced a proliferation of patents, and it is not always clear to industry participants, including

us, which patents cover various types of products or methods of use.

The coverage of patents is subject to interpretation by the courts,

and the interpretation is not always uniform.

If we are sued for patent infringement, we would

need to demonstrate that our product candidates or methods either do not infringe the patent claims of the relevant patent or that the

patent claims are invalid, and we may not be able to do this.

Proving invalidity is difficult.

For example, in the U.S., proving invalidity requires a showing of clear and convincing evidence to overcome the presumption of validity

enjoyed by issued patents.

Even if we are successful in these proceedings, we may incur substantial costs and diversion of management’s

time and attention in pursuing these proceedings, which could have a material adverse effect on us.

If we are unable to avoid infringing

the patent rights of others, we may be required to seek a license, which may not be available, defend an infringement action or challenge

the validity of the patents in court.

For example, in the U.S., proving invalidity

requires a showing of clear and convincing evidence to overcome the presumption of validity enjoyed by issued patents.

Even if we are

successful in these proceedings, we may incur substantial costs and diversion of management’s time and attention in pursuing these

proceedings, which could have a material adverse effect on us.

If we are unable to avoid infringing the patent rights of others, we may

be required to seek a license, which may not be available, defend an infringement action or challenge the validity of the patents in

Patent litigation is costly and time consuming.

We may not have sufficient resources to bring these

actions to a successful conclusion.

In addition, if we do not obtain a license, develop or obtain non-infringing technology, fail

to defend an infringement action successfully or have infringed patents declared invalid, we may incur substantial monetary damages,

encounter significant delays in bringing our product candidates to market and be precluded from manufacturing or selling our product

of our competitors may be able to sustain the costs of complex patent litigation more effectively than us or the third parties from whom

we license intellectual property because they have substantially greater resources.

In addition, any uncertainties resulting from the

initiation and continuation of any litigation could have a material adverse effect on our ability to raise the funds necessary to continue

our operations.

we are not able to adequately prevent disclosure of trade secrets and other proprietary information, the value of our technology and

product could be significantly diminished.

also rely on trade secrets to protect our proprietary technologies, especially where we do not believe patent protection is appropriate

or obtainable.

However, trade secrets are difficult to protect.

We rely in part on confidentiality agreements with our employees, consultants,

outside scientific collaborators, sponsored researchers and other advisors to protect our trade secrets and other proprietary information.

These agreements may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event

of unauthorized disclosure of confidential information.

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

For example, the FDA, as part of its transparency initiative, is currently considering whether to make additional information

publicly available on a routine basis, including information that we may consider to be trade secrets or other proprietary information,

and it is not clear at the present time how the FDA’s disclosure policies may change in the future, if at all.

Costly and time-consuming litigation

could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection

could adversely affect our competitive business position.

may be subject to claims that our employees or consultants have wrongfully used or disclosed alleged trade secrets.

is common in the biotechnology and pharmaceutical industries, we employ individuals who were previously employed at other biotechnology

or pharmaceutical companies, including our competitors or potential competitors.

Although we try to ensure that our employees and consultants

do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or our employees

or consultants have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of their former employers.

Litigation may be necessary to defend against these claims.

If we fail in defending any such claims, in addition to paying monetary damages,

we could lose valuable intellectual property rights or personnel, which could adversely impact our business.

Even if we are successful

in defending against these claims, litigation could result in substantial costs and be a distraction to management.

intellectual property may not be sufficient to protect our product candidates from competition, which may negatively affect our business

as well as limit our partnership or acquisition appeal.

may be subject to competition despite the existence of intellectual property we license or may in the future own.

We can give no assurances

that our intellectual property claims will be sufficient to prevent third parties from designing around patents we own or license and

developing and commercializing competitive products.

The existence of competitive products that avoid our intellectual property could

materially adversely affect our operating results and financial condition.

Furthermore, limitations, or perceived limitations, in our

intellectual property may limit the interest of third parties to partner, collaborate or otherwise transact with us, if third parties

perceive a higher than acceptable risk to commercialization of our product candidates or future product candidates.

may elect to sue a third party, or otherwise make a claim, alleging infringement or other violation of patents, trademarks, trade dress,

copyrights, trade secrets, domain names or other intellectual property rights that we either own or license from a third party.

do not prevail in enforcing our intellectual property rights in this type of litigation, we may be subject to:

monetary damages related to the legal expenses of the third party;

additional competition that may have a significant adverse effect on our product pricing,

market share, business operations, financial condition, and the commercial viability of our

● restructuring

our company or delaying or terminating select business opportunities, including, but not

limited to, research and development, clinical trial, and commercialization activities, due

to a potential deterioration of our financial condition or market competitiveness.

third party may also challenge the validity, enforceability or scope of the intellectual property rights that we license or own and the

result of these challenges may narrow the scope or claims of or invalidate patents that are integral to our product candidates in the

There can be no assurance that we will be able to successfully defend patents we own or license in an action against third parties

due to the unpredictability of litigation and the high costs associated with intellectual property litigation, amongst other factors.

property rights and enforcement may be less extensive in jurisdictions outside of the U.S.

Therefore, we may not be able to protect our

intellectual property and third parties may be able to market competitive products that may use some or all of our intellectual property.

to patent law, including the Leahy-Smith America Invests Act of 2011 and the Patent Reform Act of 2009 and other future article

of legislation, may substantially change the regulations and procedures surrounding patent applications, issuance of patents and prosecution

We can give no assurances that the patents of our licensor can be defended or will protect us against future intellectual

property challenges, particularly as they pertain to changes in patent law and future patent law interpretations.

Related to Healthcare Compliance and Other Regulations

we fail to comply with healthcare regulations, we could face substantial enforcement actions, including civil and criminal penalties

and our business, operations and financial condition could be adversely affected.

could be subject to healthcare fraud and abuse laws and patient privacy laws of both the federal government and the states in which we

conduct our business.

We may not have sufficient resources to bring these actions to a successful conclusion.

In addition, if we do not obtain a license, develop or obtain non-infringing technology, fail to defend an infringement action successfully

or have infringed patents declared invalid, we may incur substantial monetary damages, encounter significant delays in bringing our product

candidates to market and be precluded from manufacturing or selling our product candidates.

Some of our competitors may be able to sustain

the costs of complex patent litigation more effectively than us or the third parties from whom we license intellectual property because

they have substantially greater resources.

In addition, any uncertainties resulting from the initiation and continuation of any litigation

could have a material adverse effect on our ability to raise the funds necessary to continue our operations.

If we are not able to adequately prevent

disclosure of trade secrets and other proprietary information, the value of our technology and product could be significantly diminished.

We also rely on trade secrets to protect our

proprietary technologies, especially where we do not believe patent protection is appropriate or obtainable.

However, trade secrets are

difficult to protect.

We rely in part on confidentiality agreements with our employees, consultants, outside scientific collaborators,

sponsored researchers and other advisors to protect our trade secrets and other proprietary information.

These agreements may not effectively

prevent disclosure of confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of confidential

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

For example, the FDA, as part

of its transparency initiative, is currently considering whether to make additional information publicly available on a routine basis,

including information that we may consider to be trade secrets or other proprietary information, and it is not clear at the present time

how the FDA’s disclosure policies may change in the future, if at all.

Costly and time-consuming litigation could be necessary

to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely

affect our competitive business position.

We may be subject to claims that our employees

or consultants have wrongfully used or disclosed alleged trade secrets.

As is common in the biotechnology and pharmaceutical

industries, we employ individuals who were previously employed at other biotechnology or pharmaceutical companies, including our competitors

or potential competitors.

Although we try to ensure that our employees and consultants do not use the proprietary information or know-how of

others in their work for us, we may be subject to claims that we or our employees or consultants have inadvertently or otherwise used

or disclosed trade secrets or other proprietary information of their former employers.

Litigation may be necessary to defend against

these claims.

If we fail in defending any such claims, in addition to paying monetary damages, we could lose valuable intellectual property

rights or personnel, which could adversely impact our business.

Even if we are successful in defending against these claims, litigation

could result in substantial costs and be a distraction to management.

Our intellectual property may not be sufficient

to protect our product candidates from competition, which may negatively affect our business as well as limit our partnership or acquisition

We may be subject to competition despite the

existence of intellectual property we license or may in the future own.

We can give no assurances that our intellectual property claims

will be sufficient to prevent third parties from designing around patents we own or license and developing and commercializing competitive

The existence of competitive products that avoid our intellectual property could materially adversely affect our operating

results and financial condition.

Furthermore, limitations, or perceived limitations, in our intellectual property may limit the interest

of third parties to partner, collaborate or otherwise transact with us, if third parties perceive a higher than acceptable risk to commercialization

of our product candidates or future product candidates.

We may elect to sue a third party, or otherwise

make a claim, alleging infringement or other violation of patents, trademarks, trade dress, copyrights, trade secrets, domain names or

other intellectual property rights that we either own or license from a third party.

If we do not prevail in enforcing our intellectual

property rights in this type of litigation, we may be subject to:

paying monetary damages related to the legal expenses of the third

facing additional competition that may have a significant adverse effect

on our product pricing, market share, business operations, financial condition, and the commercial viability of our product;

restructuring our company or delaying or terminating select business

opportunities, including, but not limited to, research and development, clinical trial, and commercialization activities, due to

a potential deterioration of our financial condition or market competitiveness.

A third party may also challenge the validity,

enforceability or scope of the intellectual property rights that we license or own and the result of these challenges may narrow the

scope or claims of or invalidate patents that are integral to our product candidates in the future.

There can be no assurance that we

will be able to successfully defend patents we own or license in an action against third parties due to the unpredictability of litigation

and the high costs associated with intellectual property litigation, amongst other factors.

Intellectual property rights and enforcement

may be less extensive in jurisdictions outside of the U.S.

Therefore, we may not be able to protect our intellectual property and third

parties may be able to market competitive products that may use some or all of our intellectual property.

Changes to patent law, including the Leahy-Smith America

Invests Act of 2011 and the Patent Reform Act of 2009 and other future article of legislation, may substantially change the regulations

and procedures surrounding patent applications, issuance of patents and prosecution of patents.

We can give no assurances that the patents

of our licensor can be defended or will protect us against future intellectual property challenges, particularly as they pertain to changes

in patent law and future patent law interpretations.

Risks Related to Healthcare Compliance and

Other Regulations

If we fail to comply with healthcare regulations,

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

could be adversely affected.

We could be subject to healthcare fraud and abuse

laws and patient privacy laws of both the federal government and the states in which we conduct our business.

The laws include:

federal healthcare program anti-kickback law, which prohibits, among other things, persons

from soliciting, receiving or providing remuneration, directly or indirectly, to induce either

the referral of an individual, for an item or service or the purchasing or ordering of a

good or service, for which payment may be made under federal healthcare programs such as

the Medicare and Medicaid programs;

false claims laws which prohibit, among other things, individuals or entities from knowingly

presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other

third-party payers that are false or fraudulent, and which may apply to entities like us

which provide coding and billing information to customers;

which prohibits executing a scheme to defraud any healthcare benefit program or making false

statements relating to healthcare matters and which also imposes certain requirements relating

to the privacy, security and transmission of individually identifiable health information;

FDCA which among other things, strictly regulates drug manufacturing and product marketing,

prohibits manufacturers from marketing drug products for off-label use and

regulates the distribution of drug samples;

law equivalents of each of the above federal laws, such as anti-kickback and false claims

laws which may apply to items or services reimbursed by any third-party payer, including

commercial insurers, and state laws governing the privacy and security of health information

in certain circumstances, many of which differ from each other in significant ways and often

are not preempted by federal laws, thus complicating compliance efforts.

our operations are found to be in violation of any of the laws described above or any governmental regulations that apply to us, we may

be subject to penalties, including civil and criminal penalties, damages, fines and the curtailment or restructuring of our operations.

Any penalties, damages, fines, curtailment or restructuring of our operations could adversely affect our ability to operate our business

and our financial results.

Although compliance programs can mitigate the risk of investigation and prosecution for violations of these

laws, the risks cannot be entirely eliminated.

Any action against us for violation of these laws, even if we successfully defend against

it, could cause us to incur significant legal expenses and divert management’s attention from the operation of our business.

achieving and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly.

Reform in the United States.

the United States, there have been, and continue to be, a number of legislative and regulatory changes and proposed changes to the healthcare

system that could affect the future results of pharmaceutical manufactures’ operations.

In particular, there have been and continue

to be a number of initiatives at the federal and state levels that seek to reduce healthcare costs.

For example, the Affordable Care

Act (“ACA”), which was originally enacted in March 2010 and subsequently amended, includes measures to significantly change

the way healthcare is financed by both governmental and private insurers.

Among the provisions of the ACA of greatest importance to the

pharmaceutical and biotechnology industry are the following:

annual, nondeductible fee on any entity that manufactures or imports certain branded prescription

drugs and biologic agents, apportioned among these entities according to their market share

in certain government healthcare programs;

● implementation

of the federal physician payment transparency requirements, sometimes referred to as the

“Physician Payments Sunshine Act”;

licensure framework for follow-on biologic products;

new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and

conduct comparative clinical effectiveness research, along with funding for such research;

● establishment

of a Center for Medicare Innovation at the Centers for Medicare & Medicaid Services

to test innovative payment and service delivery models to lower Medicare and Medicaid spending,

the federal healthcare program anti-kickback law, which prohibits,

among other things, persons from soliciting, receiving or providing remuneration, directly or indirectly, to induce either the referral

of an individual, for an item or service or the purchasing or ordering of a good or service, for which payment may be made under

federal healthcare programs such as the Medicare and Medicaid programs;

federal false claims laws which prohibit, among other things, individuals

or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third-party

payers that are false or fraudulent, and which may apply to entities like us which provide coding and billing information to customers;

HIPAA which prohibits executing a scheme to defraud any healthcare

benefit program or making false statements relating to healthcare matters and which also imposes certain requirements relating to

the privacy, security and transmission of individually identifiable health information;

the FDCA which among other things, strictly regulates drug manufacturing

and product marketing, prohibits manufacturers from marketing drug products for off-label use and regulates the

distribution of drug samples;

state law equivalents of each of the above federal laws, such as anti-kickback

and false claims laws which may apply to items or services reimbursed by any third-party payer, including commercial insurers, and

state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other

in significant ways and often are not preempted by federal laws, thus complicating compliance efforts.

If our operations are found to be in violation

of any of the laws described above or any governmental regulations that apply to us, we may be subject to penalties, including civil

and criminal penalties, damages, fines and the curtailment or restructuring of our operations.

Any penalties, damages, fines, curtailment

or restructuring of our operations could adversely affect our ability to operate our business and our financial results.

Although compliance

programs can mitigate the risk of investigation and prosecution for violations of these laws, the risks cannot be entirely eliminated.

Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal

expenses and divert management’s attention from the operation of our business.

Moreover, achieving and sustaining compliance with

applicable federal and state privacy, security and fraud laws may prove costly.

Healthcare Reform in the United States.

In the United States, there have been, and continue

to be, a number of legislative and regulatory changes and proposed changes to the healthcare system that could affect the future results

of pharmaceutical manufactures’ operations.

In particular, there have been and continue to be a number of initiatives at the federal

and state levels that seek to reduce healthcare costs.

For example, the Affordable Care Act (“ACA”), which was originally

enacted in March 2010 and subsequently amended, includes measures to significantly change the way healthcare is financed by both governmental

and private insurers.

Among the provisions of the ACA of greatest importance to the pharmaceutical and biotechnology industry are the

an annual, nondeductible fee on any entity that manufactures or imports

certain branded prescription drugs and biologic agents, apportioned among these entities according to their market share in certain

government healthcare programs;

implementation of the federal physician payment transparency requirements,

sometimes referred to as the “Physician Payments Sunshine Act”;

a licensure framework for follow-on biologic products;

a new Patient-Centered Outcomes Research Institute to oversee, identify

priorities in, and conduct comparative clinical effectiveness research, along with funding for such research;

establishment of a Center for Medicare Innovation at the Centers for

Medicare & Medicaid Services to test innovative payment and service delivery models to lower Medicare and Medicaid spending,

potentially including prescription drug spending;

increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug

Rebate Program, to 23.1% and 13% of the average manufacturer price for most branded and generic

drugs, respectively and capped the total rebate amount for innovator drugs at 100% of the

Average Manufacturer Price;

new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program

are calculated for certain drugs and biologics, including our product candidates, that are

inhaled, infused, instilled, implanted or injected;

of manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals

who are enrolled in Medicaid managed care organizations;

of eligibility criteria for Medicaid programs by, among other things, allowing states to

offer Medicaid coverage to additional individuals and by adding new mandatory eligibility

categories for individuals with income at or below 133% of the federal poverty level, thereby

potentially increasing manufacturers’ Medicaid rebate liability;

new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer

50% point-of-sale discounts off negotiated prices of applicable brand drugs to

eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s

outpatient drugs to be covered under Medicare Part D;

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

of the provisions of the ACA have yet to be implemented, and there have been legal and political challenges to certain aspects of the

The former Trump administration issued certain executive orders and other directives designed to delay, circumvent, or loosen certain

requirements mandated by the ACA.

Concurrently, Congress considered legislation that would repeal or repeal and replace all or part of

While Congress has not passed repeal legislation, the Tax Cuts and Jobs Act of 2017 included a provision repealing, effective

January 1, 2019, the tax-based shared responsibility payment imposed by the ACA on certain individuals who fail to maintain

qualifying health coverage for all or part of a year that is commonly referred to as the “individual mandate.” Congress may

consider other legislation to repeal or replace elements of the ACA.

of the details regarding the implementation of the ACA are yet to be determined, and at this time, the full effect that the ACA would

have on a pharmaceutical manufacturer remains unclear.

In particular, there is uncertainty surrounding the applicability of the biosimilars

provisions under the ACA.

This uncertainty is heightened by President Biden’s January 28, 2021 Executive Order on Strengthening

Medicaid and the Affordable Care Act, which indicates that the Biden administration may significantly modify the ACA and potentially

revoke any changes implemented by the Trump administration.

FDA has issued several guidance documents, but no implementing regulations, on biosimilars.

A number of biosimilar applications have

been approved over the past few years.

The regulations that are ultimately promulgated and their implementation are likely to have considerable

impact on the way pharmaceutical manufacturers conduct their business and may require changes to current strategies.

A biosimilar is

a biological product that is highly similar to an approved drug notwithstanding minor differences in clinically inactive components,

and for which there are no clinically meaningful differences between the biological product and the approved drug in terms of the safety,

purity, and potency of the product.

states have become increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and

biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access,

and marketing cost disclosure and transparency measures, and to encourage importation from other countries and bulk purchasing.

mandated price controls on payment amounts by third-party payors or other restrictions could harm a pharmaceutical manufacturer’s

business, results of operations, financial condition and prospects.

In addition, regional healthcare authorities and individual hospitals

are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription

drug and other healthcare programs.

This could reduce ultimate demand for certain products or put pressure product pricing, which could

negatively affect a pharmaceutical manufacturer’s business, results of operations, financial condition and prospects.

is also possible that President Biden will further reform the ACA and other federal programs in a manner that may impact our operations.

For example, the Biden administration has indicated that a goal of its administration is to expand and support Medicaid and the ACA and

to make high-quality healthcare accessible and affordable.

The potential increase in patients covered by government funded insurance

may impact our pricing.

Further, it is possible that the Biden administration may further increase the scrutiny on drug pricing.

addition, given recent federal and state government initiatives directed at lowering the total cost of healthcare, the Biden administration,

Congress and state legislatures will likely continue to focus on healthcare reform, the cost of prescription drugs and biologics and

the reform of the Medicare and Medicaid programs.

an increase in the statutory minimum rebates a manufacturer must pay

under the Medicaid Drug Rebate Program, to 23.1% and 13% of the average manufacturer price for most branded and generic drugs, respectively

and capped the total rebate amount for innovator drugs at 100% of the Average Manufacturer Price;

a new methodology by which rebates owed by manufacturers under the

Medicaid Drug Rebate Program are calculated for certain drugs and biologics, including our product candidates, that are inhaled,

infused, instilled, implanted or injected;

extension of manufacturers’ Medicaid rebate liability to covered

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

expansion of eligibility criteria for Medicaid programs by, among other

things, allowing states to offer Medicaid coverage to additional individuals and by adding new mandatory eligibility categories for

individuals with income at or below 133% of the federal poverty level, thereby potentially increasing manufacturers’ Medicaid

rebate liability;

a new Medicare Part D coverage gap discount program, in which manufacturers

must agree to offer 50% point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries

during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part

expansion of the entities eligible for discounts under the Public Health

Some of the provisions of the ACA have yet to

be implemented, and there have been legal and political challenges to certain aspects of the ACA.

The former Trump administration issued

certain executive orders and other directives designed to delay, circumvent, or loosen certain requirements mandated by the ACA.

Concurrently,

Congress considered legislation that would repeal or repeal and replace all or part of the ACA.

While Congress has not passed repeal

legislation, the Tax Cuts and Jobs Act of 2017 included a provision repealing, effective January 1, 2019, the tax-based shared

responsibility payment imposed by the ACA on certain individuals who fail to maintain qualifying health coverage for all or part of a

year that is commonly referred to as the “individual mandate.” Congress may consider other legislation to repeal or replace

elements of the ACA.

Many of the details regarding the implementation

of the ACA are yet to be determined, and at this time, the full effect that the ACA would have on a pharmaceutical manufacturer remains

In particular, there is uncertainty surrounding the applicability of the biosimilars provisions under the ACA.

This uncertainty

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

indicates that the Biden administration may significantly modify the ACA and potentially revoke any changes implemented by the Trump

administration.

The FDA has issued several guidance documents,

but no implementing regulations, on biosimilars.

A number of biosimilar applications have been approved over the past few years.

regulations that are ultimately promulgated and their implementation are likely to have considerable impact on the way pharmaceutical

manufacturers conduct their business and may require changes to current strategies.

A biosimilar is a biological product that is highly

similar to an approved drug notwithstanding minor differences in clinically inactive components, and for which there are no clinically

meaningful differences between the biological product and the approved drug in terms of the safety, purity, and potency of the product.

Individual states have become increasingly aggressive

in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price

or patient reimbursement constraints, discounts, restrictions on certain product access, and marketing cost disclosure and transparency

measures, and to encourage importation from other countries and bulk purchasing.

Legally mandated price controls on payment amounts by

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

condition and prospects.

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

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

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

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

It is also possible that President Biden will

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

For example, the Biden administration has

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

and affordable.

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

Further, it is possible

that the Biden administration may further increase the scrutiny on drug pricing.

In addition, given recent federal and state government

initiatives directed at lowering the total cost of healthcare, the Biden administration, Congress and state legislatures will likely

continue to focus on healthcare reform, the cost of prescription drugs and biologics and the reform of the Medicare and Medicaid programs.

For example, there have been several recent U.S.

congressional inquiries and proposed

federal and proposed and enacted state legislation designed to, among other things, bring more transparency to drug pricing, review the

relationship between pricing and manufacturer patient programs, reduce the costs of drugs under Medicare and reform government program

reimbursement methodologies for drug products.

Further, in July 2020, former President Trump issued a number of executive orders that

are intended to lower the costs of prescription drug products including one that directs HHS to finalize the rulemaking process on modifying

the anti-kickback law safe harbors for discounts for plans, pharmacies, and pharmaceutical benefit managers.

No assurance can be given

whether these orders will remain in effect under the Biden administration.

no one can predict the full outcome of any such legislation, it may result in decreased reimbursement for drugs and biologics, which

may further exacerbate industry-wide pressure to reduce prescription drug prices.

This could harm a pharmaceutical manufacturer’s

ability to generate revenue.

Increases in importation or re-importation of pharmaceutical products from foreign countries into

the United States could put competitive pressure on a pharmaceutical manufacturer’s ability to profitably price products, which,

in turn, could adversely affect business, results of operations, financial condition and prospects.

A pharmaceutical manufacturer might

elect not to seek approval for or market products in foreign jurisdictions in order to minimize the risk of re-importation, which

could also reduce the revenue generated from product sales.

It is also possible that other legislative proposals having similar effects

will be adopted.

regulatory authorities’ assessment of the data and results required to demonstrate safety and efficacy can change over time and

can be affected by many factors, such as the emergence of new information, including on other products, changing policies and agency

funding, staffing and leadership.

We cannot be sure whether future changes to the regulatory environment will be favorable or unfavorable

to our business prospects.

For example, average review times at the FDA for marketing approval applications can be affected by a variety

of factors, including budget and funding levels and statutory, regulatory and policy changes.

employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements,

which could cause significant liability for us and harm our reputation.

are exposed to the risk of employee fraud or other misconduct, including intentional failures to comply with FDA regulations or similar

regulations of comparable foreign regulatory authorities, provide accurate information to the FDA or comparable foreign regulatory authorities,

comply with manufacturing standards we have established, comply with federal and state healthcare fraud and abuse laws and regulations

and similar laws and regulations established and enforced by comparable foreign regulatory authorities, report financial information

or data accurately or disclose unauthorized activities to us.

Employee misconduct could also involve the improper use of information

obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation.

It is not always

possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective

in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits

stemming from a failure to be in compliance with such laws or regulations.

If any such actions are instituted against us, and we are

not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business and results

of operations, including the imposition of significant civil, criminal and administrative penalties, damages, fines, imprisonment, exclusion

from government funded healthcare programs, such as Medicare and Medicaid, and integrity oversight and reporting obligations.

are subject to U.S.

and certain foreign export and import controls, sanctions, embargoes, anti-corruption laws and anti-money laundering

laws and regulations.

Compliance with these legal standards could impair our ability to compete in domestic and international markets.

can face criminal liability and other serious consequences for violations, which can harm our business.

are subject to export control and import laws and regulations, including the U.S.

congressional inquiries and proposed federal and proposed and enacted state legislation

designed to, among other things, bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient

programs, reduce the costs of drugs under Medicare and reform government program reimbursement methodologies for drug products.

in July 2020, former President Trump issued a number of executive orders that are intended to lower the costs of prescription drug products

including one that directs HHS to finalize the rulemaking process on modifying the anti-kickback law safe harbors for discounts for plans,

pharmacies, and pharmaceutical benefit managers.

No assurance can be given whether these orders will remain in effect under the Biden administration.

While no one can predict the full outcome of

any such legislation, it may result in decreased reimbursement for drugs and biologics, which may further exacerbate industry-wide pressure

to reduce prescription drug prices.

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

Increases in importation

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

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

of operations, financial condition and prospects.

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

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

product sales.

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

Furthermore, regulatory authorities’ assessment

of the data and results required to demonstrate safety and efficacy can change over time and can be affected by many factors, such as

the emergence of new information, including on other products, changing policies and agency funding, staffing and leadership.

be sure whether future changes to the regulatory environment will be favorable or unfavorable to our business prospects.

average review times at the FDA for marketing approval applications can be affected by a variety of factors, including budget and funding

levels and statutory, regulatory and policy changes.

Our employees may engage in misconduct

or other improper activities, including noncompliance with regulatory standards and requirements, which could cause significant liability

for us and harm our reputation.

We are exposed to the risk of employee fraud

or other misconduct, including intentional failures to comply with FDA regulations or similar regulations of comparable foreign regulatory

authorities, provide accurate information to the FDA or comparable foreign regulatory authorities, comply with manufacturing standards

we have established, comply with federal and state healthcare fraud and abuse laws and regulations and similar laws and regulations established

and enforced by comparable foreign regulatory authorities, report financial information or data accurately or disclose unauthorized activities

Employee misconduct could also involve the improper use of information obtained in the course of clinical trials, which could

result in regulatory sanctions and serious harm to our reputation.

It is not always possible to identify and deter employee misconduct,

and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses

or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such

laws or regulations.

If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our

rights, those actions could have a significant impact on our business and results of operations, including the imposition of significant

civil, criminal and administrative penalties, damages, fines, imprisonment, exclusion from government funded healthcare programs, such

as Medicare and Medicaid, and integrity oversight and reporting obligations.

We are subject to U.S.

and certain foreign

export and import controls, sanctions, embargoes, anti-corruption laws and anti-money laundering laws and regulations.

with these legal standards could impair our ability to compete in domestic and international markets.

We can face criminal liability

and other serious consequences for violations, which can harm our business.

We are subject to export control and import laws

and regulations, including the U.S.

Export Administration Regulations, U.S.

Customs regulations,

various economic and trade sanctions regulations administered by the U.S.

Treasury Department’s Office of Foreign Assets Controls,

Foreign Corrupt Practices Act of 1977, as amended, the U.S.

Customs regulations, various economic and trade sanctions

regulations administered by the U.S.

Treasury Department’s Office of Foreign Assets Controls, the U.S.

Foreign Corrupt Practices

Act of 1977, as amended, the U.S.

domestic bribery statute contained in 18 U.S.C.

Travel Act, the USA PATRIOT Act and other state and national anti-bribery and anti-money laundering laws in the countries in which

we conduct activities.

Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, contractors,

and other collaborators from authorizing, promising, offering or providing, directly or indirectly, improper payments or anything else

of value to recipients in the public or private sector.

We may engage third parties for clinical trials outside of the United States,

to sell our products abroad once we enter a commercialization phase and/or to obtain necessary permits, licenses, patent registrations,

and other regulatory approvals.

We have direct or indirect interactions with officials and employees of government agencies or

government-affiliated hospitals, universities and other organizations.

We can be held liable for the corrupt or other illegal activities

of our employees, agents, contractors and other collaborators, even if we do not explicitly authorize or have actual knowledge of such

Any violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties,

imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational

harm and other consequences.

Related to Owning our Common Stock

price of our common stock may fluctuate substantially.

should consider an investment in our common stock to be risky, and you should invest in our common stock only if you can withstand a

significant loss and wide fluctuations in the market value of your investment.

Some factors that may cause the market price of our common

stock to fluctuate, in addition to the other risks mentioned in this “Risk Factors” section and elsewhere in this Annual

Report on Form 10-K are:

of our common stock by our stockholders, executives, and directors;

and limitations in trading volumes of our shares of common stock;

ability to obtain financings to conduct and complete research and development activities

including, but not limited to, our clinical trials, and other business activities;

delays in the expected recognition of revenue due to lengthy and sometimes unpredictable

sales timelines;

timing and success of introductions of new products by us or our competitors or any other

change in the competitive dynamics of our industry, including consolidation among competitors,

customers or strategic partners;

outages or security breaches;

ability to secure resources and the necessary personnel to conduct clinical trials on our

desired schedule;

● commencement,

enrollment or results of our clinical trials for our product candidates or any future clinical

trials we may conduct;

in the development status of our product candidates;

delays or adverse developments or perceived adverse developments with respect to the FDA’s

review of our planned pre-clinical and clinical trials;

delay in our submission for studies or product approvals or adverse regulatory decisions,

including failure to receive regulatory approval for our product candidates;

● unanticipated

safety concerns related to the use of our product candidates;

to meet external expectations or management guidance;

in our capital structure or dividend policy, future issuances of securities, sales of large

blocks of common stock by our stockholders;

cash position;

● announcements

and events surrounding financing efforts, including debt and equity securities;

inability to enter into new markets or develop new products;

● reputational

● competition

from existing technologies and products or new technologies and products that may emerge;

● announcements

of acquisitions, partnerships, collaborations, joint ventures, new products, capital commitments,

or other events by us or our competitors;

in general economic, political and market conditions in or any of the regions in which we

conduct our business;

in industry conditions or perceptions;

in valuations of similar companies or groups of companies;

research reports, recommendation and changes in recommendations, price targets, and withdrawals

and additions of key personnel;

and litigations related to intellectual property, proprietary rights, and contractual obligations;

in applicable laws, rules, regulations, or accounting practices and other dynamics;

events or factors, many of which may be out of our control.

addition, if the market for stocks in our industry or industries related to our industry, or the stock market in general, experiences

a loss of investor confidence, the trading price of our common stock could decline for reasons unrelated to our business, financial condition

and results of operations.

If any of the foregoing occurs, it could cause our stock price to fall and may expose us to lawsuits that,

even if unsuccessful, could be costly to defend and a distraction to management.

and economic conditions may negatively impact our business, financial condition and share price.

over medical epidemics, energy costs, geopolitical issues, the U.S.

mortgage market and a deteriorating real estate market, unstable

global credit markets and financial conditions, and volatile oil prices have led to periods of significant economic instability, diminished

liquidity and credit availability, declines in consumer confidence and discretionary spending, diminished expectations for the global

economy and expectations of slower global economic growth, increased unemployment rates, and increased credit defaults in recent years.

Our general business strategy may be adversely affected by any such economic downturns (including the current downturn related to the

current COVID-19 pandemic), volatile business environments and continued unstable or unpredictable economic and market conditions.

If these conditions continue to deteriorate or do not improve, it may make any necessary debt or equity financing more difficult to complete,

more costly, and more dilutive.

Failure to secure any necessary financing in a timely manner and on favorable terms could have a material

adverse effect on our growth strategy, financial performance, and share price and could require us to delay or abandon development or

commercialization plans.

securities or industry analysts do not publish research or reports, or publish unfavorable research or reports about our business, our

stock price and trading volume may decline.

The trading market for our common stock will rely

in part on the research and reports that industry or financial analysts publish about us, our business, our markets and our competitors.

§ 201, the U.S.

Travel Act, the USA PATRIOT Act

and other state and national anti-bribery and anti-money laundering laws in the countries in which we conduct activities.

Anti-corruption

laws are interpreted broadly and prohibit companies and their employees, agents, contractors, and other collaborators from authorizing,

promising, offering or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or

private sector.

We may engage third parties for clinical trials outside of the United States, to sell our products abroad once we

enter a commercialization phase and/or to obtain necessary permits, licenses, patent registrations, and other regulatory approvals.

We have direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals, universities

and other organizations.

We can be held liable for the corrupt or other illegal activities of our employees, agents, contractors and

other collaborators, even if we do not explicitly authorize or have actual knowledge of such activities.

Any violations of the

laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export

or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm and other consequences.

Risks Related to Owning our Common Stock

The price of our common stock may fluctuate

substantially.

You should consider an investment in our common

stock to be risky, and you should invest in our common stock only if you can withstand a significant loss and wide fluctuations in the

market value of your investment.

Some factors that may cause the market price of our common stock to fluctuate, in addition to the other

risks mentioned in this “Risk Factors” section and elsewhere in this Annual Report on Form 10-K, are:

sale of our common stock by our stockholders, executives, and directors;

volatility and limitations in trading volumes of our shares of common

our ability to obtain financings to conduct and complete research and

development activities including, but not limited to, our clinical trials, and other business activities;

possible delays in the expected recognition of revenue due to lengthy

and sometimes unpredictable sales timelines;

the timing and success of introductions of new products by us or our

competitors or any other change in the competitive dynamics of our industry, including consolidation among competitors, customers

or strategic partners;

network outages or security breaches;

our ability to secure resources and the necessary personnel to conduct

clinical trials on our desired schedule;

commencement, enrollment or results of our clinical trials for our

product candidates or any future clinical trials we may conduct;

changes in the development status of our product candidates;

any delays or adverse developments or perceived adverse developments

with respect to the FDA’s review of our planned pre-clinical and clinical trials;

any delay in our submission for studies or product approvals or adverse

regulatory decisions, including failure to receive regulatory approval for our product candidates;

unanticipated safety concerns related to the use of our product candidates;

failures to meet external expectations or management guidance;

changes in our capital structure or dividend policy, future issuances

of securities, sales of large blocks of common stock by our stockholders;

our cash position;

announcements and events surrounding financing efforts, including debt

and equity securities;

our inability to enter into new markets or develop new products;

reputational issues;

competition from existing technologies and products or new technologies

and products that may emerge;

announcements of acquisitions, partnerships, collaborations, joint

ventures, new products, capital commitments, or other events by us or our competitors;

changes in general economic, political and market conditions in or

any of the regions in which we conduct our business;

changes in industry conditions or perceptions;

changes in valuations of similar companies or groups of companies;

analyst research reports, recommendation and changes in recommendations,

price targets, and withdrawals of coverage;

departures and additions of key personnel;

disputes and litigations related to intellectual property, proprietary

rights, and contractual obligations;

changes in applicable laws, rules, regulations, or accounting practices

and other dynamics;

other events or factors, many of which may be out of our control.

In addition, if the market for stocks in our

industry or industries related to our industry, or the stock market in general, experiences a loss of investor confidence, the trading

price of our common stock could decline for reasons unrelated to our business, financial condition and results of operations.

of the foregoing occurs, it could cause our stock price to fall and may expose us to lawsuits that, even if unsuccessful, could be costly

to defend and a distraction to management.

do not intend to pay cash dividends on our shares of common stock so any returns will be limited to the value of our shares, except we

have agreed to pay cash dividends in the event Renazorb is approved by the FDA and commercial sales is commenced.

anticipate that we will retain future earnings for the development, operation and expansion of our business and do not anticipate declaring

or paying any cash dividends for the foreseeable future, except that i n March 2023,we agreed with certain investors to modify our

dividend policy to state that we intend to pay dividends to all stockholders on a quarterly basis in an amount of which the aggregate

of all quarterly dividends shall equal at least seventy-five percent (75%) of our annual net cash flow from operations following the approval

of Renazorb by the FDA if obtained, and the commencement of commercial sales.

Market and economic conditions may negatively

impact our business, financial condition and share price.

Concerns over medical epidemics, energy costs,

geopolitical issues, the U.S.

mortgage market and a deteriorating real estate market, unstable global credit markets and financial conditions,

and volatile oil prices have led to periods of significant economic instability, diminished liquidity and credit availability, declines

in consumer confidence and discretionary spending, diminished expectations for the global economy and expectations of slower global economic

growth, increased unemployment rates, and increased credit defaults in recent years.

Our general business strategy may be adversely affected

by any such economic downturns (including the current downturn related to the COVID-19 pandemic), volatile business environments

and continued unstable or unpredictable economic and market conditions.

If these conditions continue to deteriorate or do not improve,

it may make any necessary debt or equity financing more difficult to complete, more costly, and more dilutive.

Failure to secure any

necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial

performance, and share price and could require us to delay or abandon development or commercialization plans.

If securities or industry analysts do not

publish research or reports, or publish unfavorable research or reports about our business, our stock price and trading volume may decline.

The trading market for our common stock will

rely in part on the research and reports that industry or financial analysts publish about us, our business, our markets and our competitors.

We do not control these analysts.

If securities analysts do not cover our common stock, the lack of research coverage may adversely affect

the market price of our common stock.

Furthermore, if one or more of the analysts who do cover us downgrade our stock or if those analysts

issue other unfavorable commentary about us or our business, our stock price would likely decline.

If one or more of these analysts cease

coverage of us or fails to regularly publish reports on us, we could lose visibility in the market and interest in our stock could decrease,

which in turn could cause our stock price or trading volume to decline and may also impair our ability to expand our business with existing

customers and attract new customers.

certain of our stockholders control a significant number of shares of our common stock, they may have effective control over actions

requiring stockholder approval.

directors, executive officers and principal stockholders, and their respective affiliates, beneficially own approximately 41% of our

outstanding shares of common stock.

As a result, these stockholders, acting together, have the ability to control the outcome of matters

submitted to our stockholders for approval, including the election of directors and any merger, consolidation or sale of all or substantially

all of our assets.

In addition, these stockholders, acting together, have the ability to control the management and affairs of our company.

Accordingly, this concentration of ownership might harm the market price of our common stock by:

deferring or preventing a change in corporate control;

a merger, consolidation, takeover or other business combination involving us;

● discouraging

a potential acquirer from making a tender offer or otherwise attempting to obtain control

sales and issuances of our common stock could result in additional dilution of the percentage ownership of our stockholders and could

cause our share price to fall.

expect that significant additional capital will be needed in the future to continue our planned operations, including increased marketing,

hiring new personnel, commercializing our product, and continuing activities as an operating public company.

To the extent we raise additional

capital by issuing equity securities, our stockholders may experience substantial dilution.

We may sell common stock, convertible securities

or other equity securities in one or more transactions at prices and in a manner we determine from time to time.

If we sell common stock,

convertible securities or other equity securities in more than one transaction, investors may be materially diluted by subsequent sales.

Such sales may also result in material dilution to our existing stockholders, and new investors could gain rights superior to our existing

If securities analysts do not cover our common stock after the closing of this offering, the lack of

research coverage may adversely affect the market price of our common stock.

Furthermore, if one or more of the analysts who do cover

us downgrade our stock or if those analysts issue other unfavorable commentary about us or our business, our stock price would likely

If one or more of these analysts cease coverage of us or fails to regularly publish reports on us, we could lose visibility

in the market and interest in our stock could decrease, which in turn could cause our stock price or trading volume to decline and may

also impair our ability to expand our business with existing customers and attract new customers.

Our common stock may be delisted from The

Nasdaq Capital Market if we fail to comply with continued listing standards.

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

Capital Market, our common stock could be delisted from The Nasdaq Capital Market.

These continued listing standards include specifically

enumerated criteria, such as:

$1.00 minimum closing bid price;

● stockholders’

do not intend to pay cash dividends on our shares of common stock so any returns will be limited to the value of our shares.

currently anticipate that we will retain future earnings for the development, operation and expansion of our business and do not anticipate

declaring or paying any cash dividends for the foreseeable future.

Any return to stockholders will therefore be limited to the increase,

if any, of our share price.

are an “emerging growth company” and will be able to avail ourselves of reduced disclosure requirements applicable to emerging

growth companies, which could make our common stock less attractive to investors.

equity of $2.5 million;

shares of publicly-held common stock with a market value of at least $1 million;

round-lot stockholders;

with Nasdaq’s corporate governance requirements, as well as additional or more stringent criteria that may be applied in the exercise

of Nasdaq’s discretionary authority.

On August 8, 2022, we

received a written notice (the “Notice”) from the Nasdaq Stock Market LLC (“Nasdaq”) notifying us that were not

in compliance with Nasdaq Listing Rule 5550(a)(2) (the “Rule”), as the minimum bid price of the Company’s common stock

has been below $1.00 per share for 30 consecutive business days.

On February 1, 2023, Nasdaq notified us that we had not regained compliance

with the Rule and were not eligible for a second 180 day period since we did not comply with the minimum $5,000,000 stockholders’

equity initial listing requirement for The Nasdaq Capital Market.

We had requested a hearing

before the Nasdaq Hearings Panel and on February 28, 2023, Nasdaq granted to us an exception until July 24, 2023 to regain compliance

with the Rule.

On March 28, 2023, we

received notice from Nasdaq that we had regained compliance with the minimum bid price requirement for continued listing on The Nasdaq

Capital Market.

If we fail to comply

with Nasdaq’s continued listing standards, we may be delisted and our common stock will trade, if at all, only on the over-the-counter

market, such as the OTC Bulletin Board or OTCQX market, and then only if one or more registered broker-dealer market makers comply with

quotation requirements.

In addition, delisting of our common stock could depress our stock price, substantially limit liquidity of our

common stock and materially adversely affect our ability to raise capital on terms acceptable to us, or at all.

Finally, delisting of

our common stock could result in our common stock becoming a “penny stock” under the Exchange Act.

Because certain of our stockholders control

a significant number of shares of our common stock, they may have effective control over actions requiring stockholder approval.

As of December 31, 2022, our directors, executive

officers and principal stockholders, and their respective affiliates, beneficially own approximately 62% of our outstanding shares of

common stock.

As a result, these stockholders, acting together, have the ability to control the outcome of matters submitted to our stockholders

for approval, including the election of directors and any merger, consolidation or sale of all or substantially all of our assets.

addition, these stockholders, acting together, have the ability to control the management and affairs of our company.

Accordingly, this

concentration of ownership might harm the market price of our common stock by:

delaying, deferring or preventing a change in corporate control;

impeding a merger, consolidation, takeover or other business combination

involving us;

discouraging a potential acquirer from making a tender offer or otherwise

attempting to obtain control of us.

We are an “emerging growth company”

and will be able to avail ourselves of reduced disclosure requirements applicable to emerging growth companies, which could make our

common stock less attractive to investors.

We are an “emerging growth company,”

as defined in the JOBS Act and we intend to take advantage of certain exemptions from various reporting requirements that are applicable

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of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.2 billion or more;

last day of our fiscal year following the fifth anniversary of the date of the completion of our IPO;

(iii) the date on which we

have issued more than $1 billion in nonconvertible debt during the previous three years;

or (iv) the date on which we are deemed

to be a large accelerated filer under the rules of the SEC.

may be at risk of securities class action litigation.

In the past, biotechnology and pharmaceutical companies have experienced significant

stock price volatility, particularly when associated with binary events such as clinical trials and product approvals.

If we face such

litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our

business and results in a decline in the market price of our common stock.

amended and restated certificate of incorporation (“Amended and Restated Certificate of Incorporation”) and our amended and

restated bylaws (the “Amended and Restated Bylaws”), and Delaware law may have anti-takeover effects that could discourage,

delay or prevent a change in control, which may cause our stock price to decline.

Amended and Restated Certificate of Incorporation and our Amended and Restated Bylaws and Delaware law could make it more difficult for

a third party to acquire us, even if closing such a transaction would be beneficial to our stockholders.

We are authorized to issue up

to 10 million shares of preferred stock.

This preferred stock may be issued in one or more series, the terms of which may be determined

at the time of issuance by our board of directors without further action by stockholders.

The terms of any series of preferred stock

may include voting rights (including the right to vote as a series on particular matters), preferences as to dividend, liquidation, conversion

and redemption rights and sinking fund provisions.

The issuance of any preferred stock could materially adversely affect the rights of

the holders of our common stock, and therefore, reduce the value of our common stock.

In particular, specific rights granted to future

holders of preferred stock could be used to restrict our ability to merge with, or sell our assets to, a third party and thereby preserve

control by the present management.

of our Amended and Restated Certificate of Incorporation, our Amended and Restated Bylaws and Delaware law also could have the effect

of discouraging potential acquisition proposals or making a tender offer or delaying or preventing a change in control, including changes

a stockholder might consider favorable.

Such provisions may also prevent or frustrate attempts by our stockholders to replace or remove

our management.

In particular, our Amended and Restated Certificate of Incorporation, our Amended and Restated Bylaws and Delaware law,

as applicable, among other things:

the board of directors with the ability to alter the bylaws without stockholder approval;

limitations on the removal of directors;

advance notice requirements for nominations for election to the board of directors or for

proposing matters that can be acted upon at stockholder meetings;

that vacancies on the board of directors may be filled by a majority of directors in office,

although less than a quorum.

reporting obligations of being a public company in the U.S.

are expensive and time-consuming, and our management will be required to

devote substantial time to compliance matters.

a publicly traded company we will incur significant additional legal, accounting and other expenses that we did not incur as a privately

held company.

The obligations of being a public company in the U.S.

require significant expenditures and will place significant demands

on our management and other personnel, including costs resulting from public company reporting obligations under the Exchange Act and

the rules and regulations regarding corporate governance practices, including those under the Sarbanes-Oxley Act, the Dodd-Frank Wall

Street Reform and Consumer Protection Act, and the listing requirements of the stock exchange on which our securities are listed.

rules require the establishment and maintenance of effective disclosure and financial controls and procedures, internal control over

financial reporting and changes in corporate governance practices, among many other complex rules that are often difficult to implement,

monitor and maintain compliance with.

Moreover, despite recent reforms made possible by the JOBS Act, the reporting requirements, rules,

and regulations will make some activities more time-consuming and costly, particularly after we are no longer an “emerging

growth company.” In addition, we expect these rules and regulations to make it more difficult and more expensive for us to obtain

director and officer liability insurance.

Our management and other personnel will need to devote a substantial amount of time to ensure

that we comply with all of these requirements and to keep pace with new regulations, otherwise we may fall out of compliance and risk

becoming subject to litigation or being delisted, among other potential problems.

Amended and Restated Certificate of Incorporation, provides that the Court of Chancery of the State of Delaware will be the sole and

exclusive forum for substantially all disputes between the Company and its stockholders, which could limit stockholders’ ability

to obtain a favorable judicial forum for disputes with the Company or its directors, officers or employees.

Amended and Restated Certificate of Incorporation, provides that unless we consent in writing to the selection of an alternative forum,

the State of Delaware is the sole and exclusive forum for:

(i) any derivative action or proceeding brought on behalf of us, (ii) any

action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of our Company to us or our stockholders,

(iii) any action asserting a claim against us, our directors, officers or employees arising pursuant to any provision of the Delaware

General Corporation Law (the “DGCL”) or our Amended and Restated Certificate of Incorporation or our Amended and Restated

Bylaws or (iv) any action asserting a claim against us, our directors, officers, employees or agents governed by the internal affairs

doctrine, except for, as to each of (i) through (iv) above, any claim as to which the Court of Chancery determines that there is an indispensable

party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction

of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum

other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction.

This exclusive forum

provision would not apply to suits brought to enforce any liability or duty created by the Securities Act, the Exchange Act, or other

federal securities laws or any other claim for which the federal courts have exclusive jurisdiction.

To the extent that any such claims

may be based upon federal law claims, Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to

enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder.

last day of our fiscal year following the fifth anniversary of the date of the completion of this offering;

(iii) the date on which

we have issued more than $1 billion in nonconvertible debt during the previous three years;

or (iv) the date on which we are

deemed to be a large accelerated filer under the rules of the SEC.

We may be at risk of securities class action

In the past, biotechnology and pharmaceutical companies have experienced significant stock price volatility, particularly

when associated with binary events such as clinical trials and product approvals.

If we face such litigation, it could result in substantial

costs and a diversion of management’s attention and resources, which could harm our business and results in a decline in the market

price of our common stock.

Our amended and restated certificate of

incorporation (“Amended and Restated Certificate of Incorporation”) and our amended and restated bylaws (the “Amended

and Restated Bylaws”), and Delaware law may have anti-takeover effects that could discourage, delay or prevent a change in control,

which may cause our stock price to decline.

Our Amended and Restated Certificate of Incorporation

and our Amended and Restated Bylaws and Delaware law could make it more difficult for a third party to acquire us, even if closing such

a transaction would be beneficial to our stockholders.

We are authorized to issue up to 10 million shares of preferred stock.

This preferred

stock may be issued in one or more series, the terms of which may be determined at the time of issuance by our board of directors without

further action by stockholders.

The terms of any series of preferred stock may include voting rights (including the right to vote as

a series on particular matters), preferences as to dividend, liquidation, conversion and redemption rights and sinking fund provisions.

The issuance of any preferred stock could materially adversely affect the rights of the holders of our common stock, and therefore, reduce

the value of our common stock.

In particular, specific rights granted to future holders of preferred stock could be used to restrict

our ability to merge with, or sell our assets to, a third party and thereby preserve control by the present management.

Provisions of our Amended and Restated Certificate

of Incorporation, our Amended and Restated Bylaws and Delaware law also could have the effect of discouraging potential acquisition proposals

or making a tender offer or delaying or preventing a change in control, including changes a stockholder might consider favorable.

provisions may also prevent or frustrate attempts by our stockholders to replace or remove our management.

In particular, our Amended

and Restated Certificate of Incorporation, our Amended and Restated Bylaws and Delaware law, as applicable, among other things:

provide the board of directors with the ability to alter the bylaws

without stockholder approval;

place limitations on the removal of directors;

establish advance notice requirements for nominations for election

to the board of directors or for proposing matters that can be acted upon at stockholder meetings;

provide that vacancies on the board of directors may be filled by a

majority of directors in office, although less than a quorum.

Financial reporting obligations of being

a public company in the U.S.

are expensive and time-consuming, and our management will be required to devote substantial time to compliance

As a publicly traded company we will incur significant

additional legal, accounting and other expenses that we did not incur as a privately held company.

The obligations of being a public

company in the U.S.

require significant expenditures and will place significant demands on our management and other personnel, including

costs resulting from public company reporting obligations under the Exchange Act and the rules and regulations regarding corporate governance

practices, including those under the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, and

the listing requirements of the stock exchange on which our securities are listed.

These rules require the establishment and maintenance

of effective disclosure and financial controls and procedures, internal control over financial reporting and changes in corporate governance

practices, among many other complex rules that are often difficult to implement, monitor and maintain compliance with.

Moreover, despite

recent reforms made possible by the JOBS Act, the reporting requirements, rules, and regulations will make some activities more time-consuming and

costly, particularly after we are no longer an “emerging growth company.” In addition, we expect these rules and regulations

to make it more difficult and more expensive for us to obtain director and officer liability insurance.

Our management and other personnel

will need to devote a substantial amount of time to ensure that we comply with all of these requirements and to keep pace with new regulations,

otherwise we may fall out of compliance and risk becoming subject to litigation or being delisted, among other potential problems.

Our Amended and Restated Certificate of

Incorporation, provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for substantially all

disputes between the Company and its stockholders, which could limit stockholders’ ability to obtain a favorable judicial forum

for disputes with the Company or its directors, officers or employees.

Our Amended and Restated Certificate of Incorporation,

provides that unless we consent in writing to the selection of an alternative forum, the State of Delaware is the sole and exclusive

(i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim of breach of a fiduciary

duty owed by any director, officer or other employee of our Company to us or our stockholders, (iii) any action asserting a claim against

us, our directors, officers or employees arising pursuant to any provision of the Delaware General Corporation Law (the “DGCL”)

or our Amended and Restated Certificate of Incorporation or our Amended and Restated Bylaws or (iv) any action asserting a claim against

us, our directors, officers, employees or agents governed by the internal affairs doctrine, except for, as to each of (i) through (iv)

above, any claim as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of

the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten

days following such determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery,

or for which the Court of Chancery does not have subject matter jurisdiction.

This exclusive forum provision would not apply to suits

brought to enforce any liability or duty created by the Securities Act, the Exchange Act, or other federal securities laws or any other

claim for which the federal courts have exclusive jurisdiction.

To the extent that any such claims may be based upon federal law claims,

Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created

by the Exchange Act or the rules and regulations thereunder.

Section 22 of the Securities Act creates concurrent

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rules and regulations thereunder.

Our Amended and Restated Certificate of Incorporation contains a federal forum provision which provides

that unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America

will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.

or entity purchasing or otherwise acquiring any interest in shares of our capital stock are deemed to have notice of and consented to

this provision.

However, our Amended and Restated Certificate of Incorporation contains a federal forum provision which

provides that unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States

of America will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.

Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock are deemed to have notice of and consented

to this provision.

The Supreme Court of Delaware has held that this type of exclusive federal forum provision is enforceable.

uncertainty, however, as to whether courts of other jurisdictions would enforce this provision, if applicable.

choice of forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes

with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and

other employees.

Alternatively, if a court were to find our choice of forum provisions contained in our Amended and Restated Certificate

of Incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action

in other jurisdictions, which could harm our business, results of operations, and financial condition.

to maintain effective internal controls could cause our investors to lose confidence in us and adversely affect the market price of our

common stock.

be uncertainty, however, as to whether courts of other jurisdictions would enforce this provision, if applicable.

These choice of forum provisions may limit a

stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers

or other employees, which may discourage such lawsuits against us and our directors, officers and other employees.

Alternatively, if

a court were to find our choice of forum provisions contained in our Amended and Restated Certificate of Incorporation to be inapplicable

or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could

harm our business, results of operations, and financial condition.

Failure to maintain

effective internal controls could cause our investors to lose confidence in us and adversely affect the market price of our common stock.

If our internal controls are not effective, we may not be able to accurately report our financial results or prevent fraud.

internal control over financial reporting is necessary for us to provide reliable financial reports in a timely manner.

In connection

with the preparation of our financial statements for the years ended December 31, 2020 and 2021, we concluded that there were material

weaknesses in our internal control over financial reporting.

A material weakness is a significant deficiency, or a combination of significant

deficiencies, in internal control over financial reporting such that it is reasonably possible that a material misstatement of the annual

or interim financial statements will not be prevented or detected on a timely basis.

Effective internal control

over financial reporting is necessary for us to provide reliable financial reports in a timely manner.

In connection with the preparation

of our financial statements for the years ended December 31, 2021 and 2022, we concluded that there were material weaknesses in

our internal control over financial reporting.

A material weakness is a significant deficiency, or a combination of significant deficiencies,

in internal control over financial reporting such that it is reasonably possible that a material misstatement of the annual or interim

financial statements will not be prevented or detected on a timely basis.

Specifically, we lack a sufficient number of professionals

11 unchanged sentences

condition or divert financial and management resources from our core business.

UNRESOLVED STAFF COMMENTS

principal address is 4300 El Camino Real, Suite 210, Los Altos, CA 94022.

We believe our facilities are adequate to meet our current

needs, although we may seek to negotiate new leases or evaluate additional or alternate space for our operations.

We believe appropriate

alternative space would be readily available on commercially reasonable terms.

STAFF COMMENTS

Our principal address is 4300 El Camino Real,

Suite 210, Los Altos, CA 94022.

We believe our facilities are adequate to meet our current needs, although we may seek to negotiate new

leases or evaluate additional or alternate space for our operations.

We believe appropriate alternative space would be readily available

on commercially reasonable terms.

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