ITEM 1A. Risk Factors
RISK FACTORS
Investing in shares of our common stock
is very speculative and involves a high degree of risk. You should carefully consider the risks and uncertainties described
below, the section of this Annual Report entitled “Management’s Discussion and Analysis of Financial Condition and Results
of Operations” and our financial statements and related notes included elsewhere in this Annual Report. The risks and uncertainties
described below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe
are not material, may also become important factors that affect us. If any of the following risks occur, our business, operating results
and prospects could be materially harmed. In that event, the price of our common stock could decline, and you could lose part or all
of your investment.
Risks Related to Our Intellectual Property
We depend on rights to Telomir-1 that are
or will be licensed to us. We do not own the intellectual property rights to Telomir-1 and any loss of our rights to it could prevent
us from selling our product.
Within our present and future pipeline of treatments,
Telomir-1 is in-licensed from MIRALOGX. We do not currently own any intellectual property rights, including the patent application that
underlies this license. Our rights to use Telomir-1 is subject to the negotiation of, continuation of and compliance with the terms of
this license. Thus, the non-provisional patent application is not written by us or our attorneys, and we did not have control over the
drafting and prosecution. The patent owner and our licensor might not have given the same attention to the drafting and prosecution of
these patents and applications as we would have if we had been the owner of the patent application and had control over the drafting.
We cannot be certain that drafting of the licensed patent application, or patent prosecution, by the licensor have been or will be conducted
in compliance with applicable laws and regulations or will result in valid and enforceable patents and other intellectual property rights.
This absence of control over the drafting, prosecution of patent and applications, along with non-compliance with royalty payments and
confidentiality breaches are just some of the ways that may result in the Company’s’ loss of the license and inability to
continue operations.
Significant additional research and development
activity, pre-clinical testing, and/or clinical testing Telomir-1 is required before we will have a chance to achieve a viable product
for licensing or commercialization. Our business currently depends entirely on the successful development, regulatory approval, and licensing
or commercialization of our product candidate, which may never occur.
Enforcement of our licensed patent application
or defense of any claims asserting invalidity of these patents is often subject to the control or cooperation of our licensor. Legal
action could be initiated against the owners of the intellectual property that we license and an adverse outcome in such legal action
could harm our business because it might prevent such companies or institutions from continuing to license intellectual property that
we may need to operate our business. In addition, such licensor may resolve such litigation in a way that benefits it but adversely affects
our ability to have freedom to operate to develop and commercialize Telomir-1.
We may not be able to adequately protect
our product candidates or our proprietary technology in the marketplace.
Our success will depend, in part, on our ability
to obtain patents, protect our trade secrets and operate without infringing on the proprietary rights of others. We may rely upon a combination
of patents, trade secret protection (i.e., know-how), trademarks, licenses, and confidentiality agreements to protect the intellectual
property of our product candidates. The strengths of patents in the pharmaceutical field involve complex legal and scientific questions
and can be uncertain. Where appropriate, we seek patent protection for certain aspects of our products and technology. However, patent
protection for naturally occurring compounds is exceedingly difficult to obtain, defend and enforce. Filing, prosecuting and defending
patents throughout the world would be prohibitively expensive, so our policy is to look to patent technologies with commercial potential
in jurisdictions with significant commercial opportunities. However, patent protection may not be available for some of the products
or technology we are developing. If we must spend significant time and money protecting, defending, or enforcing our patents, designing
around patents held by others or licensing, potentially for large fees, patents or other proprietary rights held by others, our business,
results of operations and financial condition may be harmed. We may not develop additional proprietary products that are patentable.
The patent positions of pharmaceutical products
are complex and uncertain. Although we have sought and expect to continue to seek patent protection for our product candidates, their
methods of use, and methods of manufacture, any, or all of them may not be subject to effective patent protection. If any of our products
are approved and marketed for an indication for which we do not have an issued patent, our ability to use our patents to prevent a competitor
from commercializing a non-branded version of our commercial products for that non-patented indication could be significantly impaired
or even eliminated.
Publication of information related to our product
candidates by us, or others may prevent us from obtaining or enforcing patents relating to these products and product candidates. Furthermore,
others may independently develop similar products, may duplicate our products, or may design around our patent rights. In addition, any
of our issued patents may be opposed and/or declared invalid or unenforceable. If we fail to adequately protect our intellectual property,
we may face competition from companies who attempt to create a generic product to compete with our product candidates. We may also face
competition from companies who develop a substantially similar product to one of our product candidates that is not covered by any of
our patents.
Many companies have encountered significant problems
in protecting, defending and enforcing intellectual property rights in foreign jurisdictions. The legal systems of certain countries,
particularly certain developing countries, do not favor the enforcement of patents and other intellectual property rights, particularly
those relating to pharmaceuticals, which could make it difficult for us to stop the infringement of our patents or marketing of competing
products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign jurisdictions could result
in substantial cost and divert our efforts and attention from other aspects of our business.
Currently, we do not own the rights to the intellectual
property and technology that will be used to commercially develop our initial product candidate, Telomir-1. MIRALOGX, which is a separate
intellectual property development company owned by a trust established by the Company’s founder, holds the patent rights to Telomir-1,
which are currently comprised of a pending non-provisional patent application. Pending the issuance of the non-provisional patent application,
we will have an exclusive, license from MIRALOGX to develop and commercialize Telomir-1 in the U.S. for human and non-human applications.
The term of the license will continue through the date of the expiration of the last-to-expire licensed patent or, if later, the date
of the expiration of the last strategic partnership/sublicensing agreement covering the licensed products. The licensed patent rights
are expected to extend through 2043. We expect additional patent terms may be awarded, including additional patent terms based on the
time for regulatory review of drug products. There are no up-front, execution, or milestone payments required under the license agreement.
Further, no payments have been made to date under the agreement. We are also required to pay an 8% royalty on net sales or revenue in
exchange for an exclusive, worldwide license to patent rights, and we may bring suit in our own name to enforce our patent rights under
the license agreement. In the event we are unable to enforce our rights under the agreement or are unable to detect unauthorized use
of our intellectual property, we may lose the benefit of the licensed rights used to commercially develop Telomir-1. MIRALOGX will control
the prosecution of the patent applications for Telomir-1.
If third parties claim that our intellectual
property, products, processes, or anything else used by us infringes upon their intellectual property, our operating profits could be
adversely affected.
There is a substantial amount of litigation,
both within and outside the U.S., involving patent and other intellectual property rights in the pharmaceutical industry. We may, from
time to time, be notified of claims that we are infringing upon patents, trademarks, copyrights, or other intellectual property rights
owned by third parties, and we cannot provide assurances that other companies will not, in the future, pursue such infringement claims
against us, our commercial partners or any third-party proprietary technologies we have licensed. If we were found to infringe upon a
patent or other intellectual property right, or if we failed to obtain or renew a license under a patent or other intellectual property
right from a third party, or if a third party that we were licensing technologies from was found to infringe upon a patent or other intellectual
property rights of another third party, we may be required to pay damages, including damages of up to three times the damages found or
assessed, if the infringement is found to be willful, suspend the manufacture of certain products or reengineer or rebrand our products,
if feasible, or we may be unable to enter certain new product markets. Any such claims could also be expensive and time consuming to
defend and divert management’s attention and resources. Our competitive position could suffer as a result. In addition, if we have
declined or failed to enter into a valid non-disclosure or assignment agreement for any reason, we may not own the invention or our intellectual
property, and our products may not be adequately protected. Thus, we cannot guarantee that our product candidates, or our commercialization
thereof, does not and will not infringe any third party’s intellectual property.
We have been granted a license to the right
to develop Telomir-1 in the United States in human and pet application, but we have not been granted a license to the rights to patents
covering Telomir-1 in foreign jurisdictions.
We have been granted a license to the right to
develop Telomir-1 in the United States but not in countries outside the United States, as MIRALOGX has retained all rights outside the
United States and may license such rights to other parties. Accordingly, MIRALOGX potentially could develop a competing product for such
jurisdictions outside of the United States.
Risks Related to Our Operations and Financial
Condition
We are an early development-stage company
with no revenues.
As an early development-stage enterprise that
is focused on the development of a pre-clinical pharmaceutical product, we have generated no revenue and have an accumulated deficit
of $41.0 million and $30.6 million as of December 31, 2025 and December 31, 2024, respectively. There can be no assurance that sufficient
funds required to pursue our development program will be generated from operations or that funds will be available from external sources,
such as debt or equity financings or other potential sources. The lack of additional capital resulting from the inability to generate
cash flow from operations, or to raise capital from external sources would force us to substantially curtail or cease operations and
would, therefore, have a material adverse effect on business. Furthermore, there can be no assurance that any such required funds, if
available, will be available on attractive terms or that they will not have a significant dilutive effect on our existing stockholders.
It is for these reasons substantial doubt about our ability to continue as a going concern exists and an explanatory paragraph relating
to our ability to continue as a going concern can be found within the report of our independent registered public accounting firm on
our audited financial statements for the fiscal year ended December 31, 2025.
We seek to overcome the circumstances that impact
our ability to remain a going concern in the future through the growth of revenues with interim cash flow deficiencies being addressed
through additional equity and debt financing. We anticipate raising additional funds through public or private financing, strategic relationships,
or other arrangements in the near future to support our business operations; however, we may not have commitments from third parties
for a sufficient amount of additional capital. We cannot be certain that any such financing will be available on acceptable terms, or
at all, and our failure to raise capital when needed could limit our ability to continue operations. Our ability to obtain additional
funding will determine our ability to continue as a going concern. Failure to secure additional financing in a timely manner and on favorable
terms would have a material adverse effect on our financial performance, results of operations and stock price and require us to curtail
or cease operations, sell off our assets, seek protection from our creditors through bankruptcy proceedings, or otherwise. Furthermore,
additional equity financing may be dilutive to the holders of our common stock, and debt financing, if available, may involve restrictive
covenants, and strategic relationships, if necessary, to raise additional funds, and may require that we relinquish valuable rights.
Because
we have a limited operating history, you may not be able to accurately evaluate our operations.
We have had limited operations to date. Therefore,
we have a limited operating history upon which to evaluate the merits of investing in our company. Our stockholders should be aware of
the difficulties normally encountered by new companies and the high rate of failure of such enterprises. The likelihood of success must
be considered in light of the problems, expenses, difficulties, complications, and delays encountered in connection with the operations
that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to the ability to
generate sufficient cash flow to operate our business, and additional costs and expenses that may exceed current estimates. We expect
to continue to incur significant losses into the foreseeable future. We recognize that if the effectiveness of our business plan is not
forthcoming, we will not be able to continue business operations. There is no history upon which to base any assumption as to the likelihood
that we will prove successful, and it is doubtful that we will generate any operating revenues or ever achieve profitable operations.
If we are unsuccessful in addressing these risks, our business will most likely fail.
We will need to raise additional financing
for the continuation of our operations.
Because we have generated no revenues and currently
operate at a loss, we are completely dependent on the continued availability of financing in order to continue our business operations.
There can be no assurance that financing sufficient to enable us to continue our operations will be available to us in the future.
We will require additional capital to advance
our development activities and to achieve a sustainable level at which operations could be supported by revenues, if any. Based on our
current operating plan and available cash resources, we believe that our existing capital will be sufficient to fund operations and planned
initial clinical development activities into the first quarter of 2027. We will require additional financing to continue development
beyond that period and to fully implement our business strategy. There can be no assurance that additional financing will be available
when needed or, if available, on terms acceptable to us.
Our failure to obtain future financing or to
produce levels of revenue to meet our financial needs could result in our inability to continue as a going concern and the failure of
our business.
Our operating results may fluctuate, which
could have a negative impact on our ability to grow our client base, establish sustainable revenues and succeed overall.
Our results of operations may fluctuate as a
result of a number of factors, some of which are beyond our control including but not limited to:
● the budgetary constraints of our customers;
● success of our strategic growth initiatives;
As a result of these factors, we may not
succeed in our business, and we could go out of business.
We have yet to achieve a profit and will
not achieve a profit in the near future, if at all.
We have not yet produced any revenues or profit
and will not in the near future, if at all. We cannot be certain that we will be able to realize sufficient revenue to achieve profitability.
Further, many of our competitors have a significantly larger industry presence and revenue stream but have yet to achieve profitability.
Our ability to continue as a going concern in the future is dependent upon raising capital from financing transactions, increasing revenue
and keeping operating expenses below our revenue levels in order to achieve positive cash flows, none of which can be assured.
Certain of our executive officers are not
employed by us on a full-time basis.
Erez Aminov, our Chief Executive Officer and
Chairman of our board of directors, is not employed by our company on a full-time basis. Mr. Aminov is the son-in-law of Jonnie R. Williams,
Sr., the founder of the Company. As intended to be provided in his employment agreement with our company, he works on a part-time and
as-needed basis. Because he does not work full time for our company, instances may occur where he may not be immediately available to
provide solutions to problems or address concerns that arise in the course of us conducting our business and thus adversely affect our
business. In addition, he can become subject to conflicts of interest because he devotes part of his working time to other business endeavors
and may have responsibilities to other entities. Although Mr. Aminov is aware of his duties and accountability to our company and to
applicable laws and policies relating to corporate opportunity and conflicts of interest, such conflicts of interest may include deciding
how much time to devote to our affairs, as well as what business opportunities should be presented to us.
Alan Weichselbaum, our Chief Financial Officer,
is not employed by our company on a full-time basis. He works on a part-time and as-needed basis. Because he does not work full time
for our company, instances may occur where he may not be immediately available to provide solutions to problems or address concerns that
arise in the course of us conducting our business and thus adversely affect our business. In addition, he can become subject to conflicts
of interest because he devotes part of her working time to other business endeavors and may have responsibilities to other entities.
Although Mr. Weichselbaum is aware of his duties and accountability to our company and to applicable laws and policies relating to corporate
opportunity and conflicts of interest, such conflicts of interest may include deciding how much time to devote to our affairs, as well
as what business opportunities should be presented to us.
Conflicts of interest may arise between
us and MIRALOGX.
MIRALOGX has a non-provisional patent application
to the rights to Telomir-1. MIRALOGX is a separate intellectual property development company owned by the Bay Shore Trust, which is an
irrevocable trust established by our founder, Jonnie R. Williams, Sr., and in which Brian McNulty is the trustee. The Bay Shore Trust
is also our largest stockholder. We have an exclusive license from MIRALOGX to develop and commercialize Telomir-1 in the U.S. for human
and non-human applications. Although the interests of MIRALOGX are 100% owned by the Bay Shore Trust, and Mr. Williams is not an officer
or director of MIRALOGX and Mr. Williams does not have voting or dispositive power over the shares of our company held by Bay Shore Trust,
our relationship with the Bay Shore Trust, Mr. Williams may create, or may create the appearance of, conflicts of interest when we are
faced with decisions that could have different implications for MIRALOGX than the decisions have for us. Furthermore, in light of the
license agreement that we have with MIRALOGX, if a dispute were to arise between MIRALOGX and us relating to our past or future relationship
with MIRALOGX or with respect to intellectual property matters, these potential conflicts of interest may make it more difficult for
us to favorably resolve such disputes.
Risks Relating to Our Business and Our Industry
Our future success will largely depend
on the success of Telomir-1 and any future product candidates, which development will require significant capital resources and years
of clinical development effort.
We currently have no drug products on the market,
and all of our drug development projects are in a pre-clinical stage of development. Our business depends almost entirely on the successful
pre-clinical and clinical development, FDA regulatory approval, and commercialization of our product candidates, principally Telomir-1.
Our stockholders need to be aware that substantial additional investments including pre-clinical and clinical development and FDA regulatory
submission and approval efforts will be required before we are permitted to undertake clinical studies and market and commercialize our
product candidates, if ever. It may be several years before we can commence clinical trials, if ever. Any clinical trial will be subject
to extensive and rigorous review and regulation by numerous government authorities in the United States and other jurisdictions where
we intend, if approved, to market our product candidates. Before obtaining regulatory approvals for any of our product candidates, we
must demonstrate through pre-clinical testing and clinical trials that the product candidate is safe and effective for its specific application.
This process can take many years and may include post- marketing studies and surveillance, which would require the expenditure of substantial
resources. Of the large number of drugs in development for approval in the United States (and the rest of the world), only a small percentage
will successfully complete the FDA regulatory approval financing to fund our planned research, development, and clinical programs, we
cannot assure you that any of our product candidates will be successfully developed or commercialized.
We may be unable to formulate or scale up any
or all of our product candidates. There is no guarantee that any of the product candidates will be or are able to be manufactured or
produced in a manner to meet the FDA’s criteria for product stability, content uniformity and all other criteria necessary for
product approval in the United States and other markets. Any of our product candidates may fail to achieve their specified endpoints
in clinical trials.
Furthermore, product candidates may not be approved
even if they achieve their specified endpoints in clinical trials. The FDA may disagree with our trial design and our interpretation
of data from clinical trials or may change the requirements for approval even after it has reviewed and commented on the design for our
clinical trials. The FDA may also approve a drug for fewer or more limited indications than we request or may grant approval contingent
on the performance of costly post-approval clinical trials (i.e., Phase IV trials). In addition, the FDA may not approve the labeling
claims that we believe are necessary or desirable for the successful commercialization of our product candidates.
If we are unable to expand our pipeline and obtain
regulatory approval for our product candidates within the timelines we anticipate, we will not be able to execute our business strategy
effectively and our ability to substantially grow our revenues will be limited, which would have a material adverse impact on our long-term
business, results of operations, financial condition, and prospects.
We are dependent on our current and future
product candidates, some of which may not receive regulatory approval or be successfully commercialized.
Our ability to progress our plan will depend
on our ability to clinically develop, gain regulatory approval for and ultimately commercialize our product candidates. Our ability to
successfully commercialize our product candidates will depend on, among other things, our ability to:
● receive IND acceptance and regulatory approvals from the FDA;
● create positive publicity surrounding our product candidates;
Our failure or delay with respect to any of the
factors above could have a material adverse effect on our business, results of operations and financial condition.
Results of pre-clinical studies and earlier
clinical trials are not necessarily predictive indicators of future results.
Any positive results from future pre-clinical
testing of our product candidates and potential future clinical trials may not necessarily be predictive of the results from Phase I,
Phase II or Phase III clinical trials. In addition, our interpretation of results derived from clinical data or our conclusions based
on our pre-clinical data may prove inaccurate. Frequently, pharmaceutical and biotechnology companies have suffered significant setbacks
in clinical trials after achieving positive results in pre-clinical testing and early phase clinical trials, and we cannot be certain
that we will not face similar setbacks. These setbacks may be caused by the fact that pre-clinical and clinical data can be susceptible
to varying interpretations and analyses. Furthermore, certain product candidates may perform satisfactorily in pre-clinical studies and
clinical trials but nonetheless fail to obtain FDA approval or appropriate approvals by the appropriate regulatory authorities in other
countries. If we fail to produce positive results in our clinical trials for our product candidates, the development timeline and regulatory
approval and commercialization prospects for them and as a result our business and financial prospects, would be materially adversely
affected.
We have limited marketing experience, and
we do not anticipate at this time establishing a sales force or distribution and reimbursement capabilities, and we may not be able to
successfully commercialize any of our product candidates if they are approved in the future.
Our ability to generate revenues ultimately depends
on our ability to sell our approved products and secure adequate third-party reimbursement. We currently have limited experience in marketing
and selling our products. We currently do not have any products approved for sale in the United States or in any other country.
The commercial success of our product candidates
will not happen for the foreseeable future and will depend on a number of factors beyond our control, including the willingness of physicians
to prescribe our products to patients, payers’ willingness and ability to pay for the drugs, the level of pricing achieved, patients’
response to our drugs and the ability of our marketing partners to generate sales. There can be no guarantee that we will be able to
establish or maintain the personnel, systems, arrangements and capabilities necessary to successfully commercialize Telomir-1 or any
product candidate approved by the FDA in the future. If we fail to establish or maintain successful marketing, sales and reimbursement
capabilities or fail to enter into successful marketing arrangements with third parties, our product revenues may suffer.
We will need to further increase the size
and complexity of our organization in the future, and we may experience difficulties in managing our growth and executing our growth
strategy.
Our management and personnel, systems, and facilities
currently in place may not be adequate to support our business plan and future growth. As a result, we may need to further expand certain
areas of our organization.
Our need to effectively manage our operations,
growth and various projects requires that we:
● attract and retain enough talented employees;
● manage our clinical trials effectively;
In addition, we may utilize the services of part-time
outside consultants and contractors to perform several tasks for us, including tasks related to compliance programs, clinical trial management,
regulatory affairs, formulation development and other drug development functions. Our growth strategy may entail expanding our use of
consultants and contractors to implement these and other tasks going forward. If we are not able to effectively expand our organization
by hiring new employees and expanding our use of consultants and contractors, we may be unable to successfully implement the tasks necessary
to effectively execute on our planned research, development, manufacturing, and commercialization activities and, accordingly, may not
achieve our research, development and commercialization goals.
We expect to face intense competition,
often from companies with greater resources and experience than we have.
The development and commercialization of drugs
and medicines is highly competitive. We compete with a variety of multinational pharmaceutical companies and specialized biotechnology
companies, as well as products and processes being developed by universities and other research institutions. Many of our competitors
have developed, are developing, or will develop drugs and processes which may be competitive with our drug candidates. Competitive products
include those that have already been approved by medicines regulators and accepted by the medical community and any new products that
may enter the market. For some of our drug development programs / areas of interest, other treatment options or products are currently
available, under development, and may become commercially available in the future. If any of our product candidates are approved for
the diseases and conditions we are currently pursuing, they may compete with a range of medicines or therapeutic treatments that are
either in development, will be developed in the future or currently marketed.
Established companies may have a competitive
advantage over us due to their size and experiences, financial resources, and institutional networks. Many of our competitors may have
significantly greater financial, technical, and human resources than we do. Due to these factors, our competitors may have an advantage
in marketing their approved drugs and may obtain regulatory approval of their drug candidates before we are able to, which may limit
our ability to develop or commercialize our drug candidates. Our competitors may also develop drugs or medicines that are safer, more
effective, more widely used and less expensive than ours. These advantages could materially impact our ability to develop and, if approved,
commercialize our product candidates successfully. Furthermore, some of these competitors may make acquisitions or establish collaborative
relationships among themselves or with third parties to increase their ability to rapidly gain market share.
Business interruptions could delay us in
the process of developing our product candidates and could disrupt our product sales.
Our research and development activities are conducted
through outside contractors and manufacturers. Loss of our contracted manufacturing facilities, stored inventory or laboratory facilities
through fire, theft or other causes, or loss of our raw material, could have an adverse effect on our ability to continue product development
activities and to conduct our business. Failure to supply our partners with commercial product may lead to adverse consequences, including
the right of partners to take over responsibility for product supply. We currently do not have insurance coverage to compensate us for
such business interruptions. Our contract manufacturers and suppliers provide that in their separate operations; however, such coverage
may prove insufficient to fully compensate us for the damage to our business resulting from any significant property or casualty loss
to those facilities.
We have significant and increasing liquidity
needs and may require additional funding.
Our operations have consumed substantial amounts
of cash since inception. For the year ended December 31, 2025, we reported a net operating cash outflow of $3.7 million and a net cash
inflow from financing activities of $9.7 million. For the year ended December 31, 2024, we reported a net operating cash outflow of $5.1
million and a net cash inflow from financing activities of $6.3 million.
Research and development, and general and administrative
expenses, and cash used for operations will continue to be significant and may increase substantially in the future in connection with
new research and development initiatives and continued product commercialization efforts. We may need to raise additional capital to
fund our operations, continue to conduct clinical trials to support potential regulatory approval of marketing applications and to fund
commercialization of our products.
The amount and timing of our future funding requirements
will depend on many factors, including, but not limited to:
● the effect of competing technological and market developments;
● personnel, facilities, and equipment requirements; and
While we expect to fund our future capital requirements
from several sources including existing cash balances, future cash flows from operations and the proceeds from equity offerings, we cannot
assure you that any of these funding sources will be available to us on favorable terms, or at all. Further, even if we can raise funds
from all of the above sources, the amounts raised may not be sufficient to meet our future capital requirements.
Operating results may vary significantly
in future periods.
Our expenses and operating results have fluctuated
in the past and our revenues, expenses, and operating results are likely to fluctuate significantly in the future. Our financial results
are unpredictable and may fluctuate, for among other reasons, due to:
● commercial sales of our products;
● our achievement of product development objectives and milestones;
● clinical trial enrollment and expenses;
● research and development expenses; and
A
high portion of our costs are predetermined on an annual basis, due in part to our significant research and development costs. Thus,
small declines in revenue could disproportionately affect financial results in a quarter. Because of these factors, our financial results
in one or more future quarters may fail to meet the expectations of securities analysts or our stockholders, which could cause our share
price to decline.
We depend upon our key personnel and our
ability to attract and retain employees.
Our future growth and success depend on our ability
to recruit, retain, manage, and motivate our employees. The inability to hire or retain experienced management personnel could adversely
affect our ability to execute our business plan and harm our operating results. Due to 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. Due to this intense competition, we may be unable to continue
to attract and retain the qualified personnel necessary for the development of our business or to recruit suitable replacement personnel.
Our proprietary information, or that of
our customers, suppliers, and business partners, may be lost or we may suffer security breaches.
In the ordinary course of our business, we will
collect and store sensitive data, including valuable and commercially sensitive intellectual property, clinical trial data, our proprietary
business information and that of our customers, suppliers and business partners, and personally identifiable information of our customers,
clinical trial subjects and employees, and patients, on our networks, and with our third-party cloud service providers. The secure processing,
maintenance and transmission of this information is critical to our operations. Despite our security measures, our information technology
and infrastructure, and that of our third parties, may be vulnerable to attacks by hackers or breached due to employee error, malfeasance,
or other disruptions. Any breach could compromise our networks and the information stored there could be accessed, publicly disclosed,
lost, or stolen. Any such access, disclosure or other loss of information could result in legal claims or proceedings, liability under
laws that protect the privacy of personal information, regulatory penalties, disrupt our operations, damage our reputation, and cause
a loss of confidence in our products and our ability to conduct clinical trials, which could adversely affect our business and reputation
and lead to delays in gaining regulatory approvals for Telomir-1 or other product candidates.
Failure of our information technology systems,
including cybersecurity attacks or other data security incidents, could significantly disrupt the operation of our business.
Our business is increasingly dependent on critical,
complex, and interdependent information technology (“IT”) systems, including internet-based systems, some of which are managed
or hosted by third parties, to support business processes as well as internal and external communications. The size and complexity of
our IT systems make us potentially vulnerable to IT system breakdowns, malicious intrusion, and computer viruses, which may result in
the impairment of our ability to operate our business effectively.
We are continuously evaluating and, where appropriate,
enhancing our IT systems to address our planned growth, including to support our planned manufacturing operations. There are inherent
costs and risks associated with implementing the enhancements to our IT systems, including potential delays in access to, or errors in,
critical business and financial information, substantial capital expenditures, additional administrative time and operating expenses,
retention of sufficiently skilled personnel to implement and operate the enhanced systems, demands on management time, and costs of delays
or difficulties in transitioning to the enhanced systems, any of which could harm our business and results of operations. In addition,
the implementation of enhancements to our IT systems may not result in productivity improvements to a level that outweighs the costs
of implementation, or at all. In addition, our systems and the systems of our third-party providers and collaborators are potentially
vulnerable to data security breaches which may expose sensitive data to unauthorized persons or to the public. Such data security breaches
could lead to the loss of confidential information, trade secrets or other intellectual property, could lead to the public exposure of
personal information (including personally identifiable information or individually identifiable health information) of our employees,
clinical trial patients, customers, business partners, and others, could lead to potential identity theft, or could lead to reputational
harm. Data security breaches could also result in loss of clinical trial data or damage to the integrity of that data. In addition, the
increased use of social media by our employees and contractors could result in inadvertent disclosure of sensitive data or personal information,
including but not limited to, confidential information, trade secrets and other intellectual property.
Any
such disruption or security breach, as well as any action by us or our employees or contractors that might be inconsistent with the rapidly
evolving data privacy and security laws and regulations applicable within the United States and elsewhere where we conduct business,
could result in enforcement actions by U.S. states, the U.S. federal government or foreign governments, liability or sanctions under
data privacy laws, including healthcare laws such as HIPAA, that protect certain types of sensitive information, regulatory penalties,
other legal proceedings such as but not limited to private litigation, the incurrence of significant remediation costs, disruptions to
our development programs, business operations and collaborations, diversion of management efforts and damage to our reputation, which
could harm our business and operations. Because of the rapidly moving nature of technology and the increasing sophistication of cybersecurity
threats, our measures to prevent, respond to and minimize such risks may be unsuccessful.
Security breaches, loss of data and other
disruptions could compromise sensitive information related to our business, prevent us from accessing critical information or expose
us to liability, which could adversely affect our business and our reputation.
In the ordinary course of our business, we, our
vendors, and our third-party cloud service providers may collect and store sensitive data, including legally protected patient health
information, credit card information, personally identifiable information about our employees and patients, intellectual property, and
proprietary business information. We manage and maintain our applications and data utilizing cloud-based and on-site systems. These applications
and data encompass a wide variety of business-critical information including research and development information, commercial information
and business and financial information.
The secure processing, storage, maintenance,
and transmission of this critical information is vital to our operations and business strategy, and we devote significant resources to
protecting such information. Although we take measures to protect sensitive information from unauthorized access or disclosure, our information
technology and infrastructure may be vulnerable to attacks by hackers, or viruses, breaches, or interruptions due to employee error,
malfeasance or other disruptions, or lapses in compliance with privacy and security mandates. Any such virus, breach or interruption
could compromise our networks and the information stored there could be accessed by unauthorized parties, publicly disclosed, lost or
stolen. We have measures in place that are designed to prevent, and if necessary to detect and respond to such security incidents, breaches
of privacy, and security mandates. However, in the future, any such access, disclosure or other loss of information could result in legal
claims or proceedings, liability under laws that protect the privacy of personal information, such as HIPAA in the United States and
the General Data Protection Regulation in the European Union, or GDPR, government enforcement actions and regulatory penalties. Unauthorized
access, loss or dissemination could also disrupt our operations, including our ability to process samples, provide test results, share
and monitor safety data, bill payers or patients, provide customer support services, conduct research and development activities, process
and prepare company financial information, manage various general and administrative aspects of our business and may damage our reputation,
any of which could adversely affect our business, financial condition and results of operations.
Geopolitical events and global economic
conditions, such as the Israel-Hamas war may impact the third parties that we engage to supply materials or manufacture any products
for our preclinical tests and clinical trials, which increases the risk of potential delay of development efforts, as applicable.
If the third parties that we engage to supply
any materials or manufacture any products for our preclinical tests and clinical trials should cease to continue to do so for any reason,
including due to the effects of global economic conditions, including the Hamas-Israel war, we likely would experience delays in advancing
these tests and trials while we identify and qualify replacement suppliers or manufacturers, as applicable, and we may be unable to obtain
replacement supplies on terms that are favorable to us. In addition, if we are not able to obtain adequate supplies of our product, or
the substances used to manufacture them, it will be more difficult for us to develop our product and compete effectively.
Our
current and anticipated dependence upon third-party suppliers may adversely affect our ability to develop our product, and product candidates
and could delay our clinical trials and development programs as well as affect our marketing and commercialization efforts. In addition,
such dependence may increase our costs and expenses, and may otherwise harm our operations and financial condition
Risks Related to Development and Regulatory
Approval of Our Product Candidates
Clinical trials for our product candidates
are expensive, time-consuming, uncertain, and susceptible to change, delay or termination. The results of clinical trials are open to
differing interpretations.
Clinical trials are expensive, time consuming
and difficult to design and implement. Regulatory agencies may analyze or interpret the results differently than us. Even if the results
of our clinical trials are favorable, the clinical trials for a number of our product candidates are expected to continue for several
years and may take significantly longer to complete. In addition, we, the FDA, or other regulatory authorities, including state and local
authorities, or an Institutional Review Board, or IRB, with respect to a trial at its institution, may suspend, delay or terminate our
clinical trials at any time, require us to conduct additional clinical trials, require a particular clinical trial to continue for a
longer duration than originally planned, require a change to our development plans such that we conduct clinical trials for a product
candidate in a different order, e.g., in a step-wise fashion rather than running two trials of the same product candidate in parallel.
The suspension, delay or termination could be for various reasons, including:
● lack of effectiveness of any product candidate during clinical trials;
● inadequacy of or changes in our manufacturing process or product formulation;
● uncertainty regarding proper dosing;
● unfavorable results from ongoing pre-clinical studies and clinical trials;
● scheduling conflicts with participating clinicians and clinical institutions;
● failure to design appropriate clinical trial protocols;
● insufficient data to support regulatory approval;
Any of the foregoing could have a material adverse
effect on our business, results of operations and financial condition.
Any failure by us to comply with existing
regulations could harm our reputation and operating results.
We are subject to extensive regulation by U.S.
federal and state governments in each of the markets where we have product candidates progressing through the approval process.
We must also adhere to all regulatory requirements
including FDA’s Good Laboratory Practice, Good Clinical Practice, and current Good Manufacturing Practices requirements (“cGMP”)
pharmacovigilance requirements, advertising, and promotion restrictions, reporting and recordkeeping requirements. If we or our suppliers
fail to comply with applicable regulations, including FDA pre-or post-approval cGMP requirements, then FDA could sanction us. Even if
a drug is FDA-approved, regulatory authorities may impose significant restrictions on a product’s indicated uses or marketing or
impose ongoing requirements for potentially costly post-marketing trials. Telomir-1, and any of our product candidates that may be approved
in the U.S. in the future, will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, distribution,
import, export, advertising, promotion, sampling, recordkeeping and submission of safety and other post-market information, including
both federal and state requirements in the U.S. In addition, manufacturers and manufacturers’ facilities are required to comply
with extensive FDA requirements, including ensuring that quality control and manufacturing procedures conform to GMP. As such, we, and
our contract manufacturers (in the event contract manufacturers are appointed in the future) are subject to continual review and periodic
inspections to assess compliance with GMP. Accordingly, we and others with whom we work must continue to spend time, money, and effort
in all areas of regulatory compliance, including manufacturing, production, quality control and quality assurance. We will also be required
to report certain adverse reactions and production problems, if any, to the FDA, and to comply with requirements concerning advertising
and promotion for our products. Promotional communications with respect to prescription drugs are subject to a variety of legal and regulatory
restrictions and must be consistent with the information in the product’s approved label.
If a regulatory agency discovers previously unknown
problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility where the product
is manufactured, or disagrees with the promotion, marketing or labeling of the product, it may impose restrictions on that product or
us, including requiring withdrawal of the product from the market. If we fail to comply with applicable regulatory requirements, a regulatory
agency or enforcement authority may:
● issue untitled or warning letters;
● seek to enjoin our activities;
● impose civil or criminal penalties;
● suspend regulatory approval;
● suspend any of our ongoing clinical trials;
● seize or detain products or require a product recall.
In
addition, any government investigation of alleged violations of law could require us to expend significant time and resources in response
and could generate negative publicity. Any failure to comply with ongoing regulatory requirements may significantly and adversely affect
our ability to commercialize and generate revenue from our product candidates. If regulatory sanctions are applied or if regulatory approval
is withdrawn, the value of our business and our operating results may be adversely affected.
Any action against us for violation of these
laws, even if we successfully defend against it, could cause us to incur significant legal expenses, divert our management’s attention
from the operation of our business and damage our reputation. We expend significant resources on compliance efforts and such expenses
are unpredictable and might adversely affect our results. Changing laws, regulations and standards might also create uncertainty, higher
expenses and increase insurance costs. As a result, we intend to invest all reasonably necessary resources to comply with evolving standards,
and this investment might result in increased management and administrative expenses and a diversion of management time and attention
from revenue-generating activities to compliance activities.
The regulatory approval processes with
the FDA are lengthy and inherently unpredictable.
We are not permitted to market our drug candidates
as medicines in the United States or other countries until we receive approval of a New Drug Application (“NDA”) from the
FDA or in any foreign countries until we receive the approval from the regulatory authorities of such countries. Prior to submitting
an NDA to the FDA for approval of our drug candidates we will need to have completed our pre-clinical studies and clinical trials and
demonstrate that our products meet all applicable standards of identity, strength, quality, and purity throughout their expiration date.
Successfully completing any clinical program and obtaining approval of an NDA is a complex, lengthy, expensive, and uncertain process,
and the FDA (or other country medicines regulatory body) may delay, limit, or deny approval of product candidates for many reasons, including,
among others, because:
● requirements by the FDA to conduct additional clinical trials;
● the FDA may change their approval policies or adopt new regulations.
Any
of these factors, many of which are beyond our control, could increase development time and / or costs or jeopardize our ability to obtain
regulatory approval for our drug candidates.
There is a high rate of failure for drug candidates proceeding
through clinical trials.
Generally, there is a high rate of failure for
drug candidates proceeding through clinical trials. We may suffer significant setbacks in our clinical trials similar to the experience
of a number of other companies in the pharmaceutical and biotechnology industries, even after receiving promising results in earlier
trials. Further, even if we view the results of a clinical trial to be positive, FDA may disagree with our interpretation of the data.
In the event that we obtain negative results from clinical trials for product candidates or other problems related to potential chemistry,
manufacturing and control issues or other hurdles occur and our product candidates are not approved, we may not be able to generate sufficient
revenue or obtain financing to continue our operations, our ability to execute on our current business plan may be materially impaired,
our reputation in the industry and in the investment community might be significantly damaged and the price of our common stock could
decrease significantly. In addition, our inability to properly design, commence and complete clinical trials may negatively impact the
timing and results of our clinical trials and ability to seek approvals for our drug candidates.
If we are found in violation of federal
or state “fraud and abuse” laws, we may be required to pay a penalty and/or be suspended from participation in federal or
state health care programs, which may adversely affect our business, financial condition, and results of operations.
In the United States, we are subject to various
federal and state health care “fraud and abuse” laws, including anti-kickback laws, false claims laws and other laws intended
to reduce fraud and abuse in federal and state health care programs, which could affect us particularly upon successful commercialization
of our products in the U.S. The Medicare and Medicaid Patient Protection Act of 1987, or federal Anti-Kickback Statute, makes it illegal
for any person, including a prescription drug manufacturer (or a party acting on its behalf), to knowingly and willfully solicit, receive,
offer or pay any remuneration that is intended to induce the referral of business, including the purchase, order or prescription of a
particular drug for which payment may be made under a federal health care program, such as Medicare or Medicaid. Under federal law, some
arrangements, known as safe harbors, are deemed not to violate the federal Anti-Kickback Statute. Although we seek to structure our business
arrangements in compliance with all applicable requirements, it is often difficult to determine precisely how the law will be applied
in specific circumstances. Accordingly, it is possible that our practices may be challenged under the federal Anti-Kickback Statute and
Federal False Claims Act. Violations of fraud and abuse laws may be punishable by criminal and/or civil sanctions, including fines and/or
exclusion or suspension from federal and state health care programs such as Medicare and Medicaid and debarment from contracting with
the U.S. government. In addition, private individuals have the ability to bring actions on behalf of the government under the federal
False Claims Act as well as under the false claims laws of several states.
Many states have adopted laws similar to the
federal anti-kickback statute, some of which apply to the referral of patients for health care services reimbursed by any source, not
just governmental payers. There are ambiguities as to what is required to comply with these state requirements and if we fail to comply
with an applicable state law requirement, we could be subject to penalties.
Neither the government nor the courts have provided
definitive guidance on the application of fraud and abuse laws to our business. Law enforcement authorities are increasingly focused
on enforcing these laws, and it is possible that some of our practices may be challenged under these laws. While we believe we have structured
our business arrangements to comply with these laws, it is possible that the government could allege violations of, or convict us of
violating, these laws. If we are found in violation of one of these laws, we could be required to pay a penalty and could be suspended
or excluded from participation in federal or state health care programs, and our business, results of operations and financial condition
may be adversely affected.
Serious adverse events or other safety
risks could require us to abandon development and preclude, delay or limit approval of our product candidates, limit the scope of any
approved label or market acceptance, or cause the recall or loss of marketing approval of products that are already marketed.
If any of our product candidates prior to or
after any approval for commercial sale, cause serious or unexpected side effects, or are associated with other safety risks such as misuse,
abuse or diversion, a number of potentially significant negative consequences could result, including:
● regulatory authorities may interrupt, delay or halt clinical trials;
● regulatory authorities may deny regulatory approval of our product candidates;
● our relationships with our collaboration partners may suffer;
● we could be sued and held liable for harm caused to patients; or
We may voluntarily suspend or terminate our clinical
trials if at any time we believe that they present an unacceptable risk to participants or if preliminary data demonstrate that our product
candidates are unlikely to receive regulatory approval or unlikely to be successfully commercialized. Following receipt of approval for
commercial sale of a product we may voluntarily withdraw or recall that product from the market if at any time we believe that its use,
or a person’s exposure to it, may cause adverse health consequences or death. To date we have not withdrawn, recalled, or taken
any other action, voluntary or mandatory, to remove an approved product from the market. In addition, regulatory agencies, IRBs, or data
safety monitoring boards may at any time recommend the temporary or permanent discontinuation of our clinical trials or request that
we cease using investigators in the clinical trials if they believe that the clinical trials are not being conducted in accordance with
applicable regulatory requirements, or that they present an unacceptable safety risk to participants. Although we have never been asked
by a regulatory agency, IRB, or data safety monitoring board to discontinue a clinical trial temporarily or permanently, if we elect
or are forced to suspend or terminate a clinical trial of any of our product candidates, the commercial prospects for that product will
be harmed and our ability to generate product revenue from that product may be delayed or eliminated. Furthermore, any of these events
may result in labeling statements such as warnings or contraindications. In addition, such events or labeling could prevent us or our
partners from achieving or maintaining market acceptance of the affected product and could substantially increase the costs of commercializing
our product candidates and impair our ability to generate revenue from the commercialization of these products either by us or by our
collaboration partners.
Risks Related to Our Reliance Upon Third Parties
We rely on, and expect to continue to rely
on, third parties to conduct clinical trials for our product candidates. If these third parties do not successfully carry out their contractual
duties, comply with regulatory requirements or meet expected deadlines, we may not be able to obtain marketing approval for or commercialize
our product candidates, and our business could be substantially harmed.
We
are dependent on third parties to conduct our clinical trials and preclinical and nonclinical studies. Specifically, we rely on, and
intend to continue to rely on, medical institutions, clinical investigators, contract research organizations, or CROs, and consultants
to conduct nonclinical studies and clinical trials, in each case in accordance with our study protocols and applicable regulatory requirements.
These CROs, investigators and other third parties play a significant role in the conduct and timing of these studies or trials and the
subsequent collection and analysis of data. Though we expect to carefully manage our relationships with our CROs, investigators and other
third parties, there can be no assurance that we will not encounter challenges or delays in the future or that these delays or challenges
will not have a material adverse impact on our business, financial condition and prospects. Further, while we have and will have agreements
governing the activities of our third-party contractors, we have limited influence over their actual performance. Nevertheless, we are
responsible for ensuring that each of our clinical trials is conducted in accordance with the applicable protocol and legal, regulatory