Achieve Life Sciences (ACHV) FY2025 10-K Risk Factors: 12 New, 10 Dropped

What the changes say

Achieve Life Sciences faces financial distress with $15.0 million in debt and negative cash flow.
Development heavily relies on cytisinicline, a plant-derived drug candidate supplied exclusively by Sopharma.
The company must secure commercial capabilities and FDA approval to succeed in the market.

What changed since the prior 10-K

New

NewRisks Related to Our Financial Condition and Capital Requirements
We have incurred substantial debt, which could impair our flexibility and access to capital and adversely affect our financial position, and our business would be materially adversely affected if we are unable to service our debt obligations
We owe $15.0 million in debt under an agreement with Silicon Valley Bank and First-Citizens Bank that matures on December 1, 2027, and we currently generate no cash flow from operations.
NewRisks Related to Our Financial Condition and Capital Requirements
maintain deposits fails or is subject to adverse conditions in the financial or credit markets, we may not be able to recover all, if any, of our deposits, which could adversely impact our operating liquidity and financial performance
Our debt agreement requires us to keep substantially all our cash with Silicon Valley Bank, exposing us to potential losses if the bank fails.
NewRisks Related to the Development of Our Product Candidate Cytisinicline
The FDA may not grant marketing approval of cytisinicline without additional clinical or nonclinical studies, or at all
The FDA may require additional clinical or nonclinical studies before granting marketing approval for our smoking cessation candidate, cytisinicline.
NewRisks Related to the Development of Our Product Candidate Cytisinicline
Clinical trials are costly, time consuming and inherently risky, and we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities. Any advances of cytisinicline into clinical trials may not have favorable results or receive regulatory approval
Clinical trials for cytisinicline are costly and time-consuming, and delays in patient recruitment or site performance could prevent successful development.
NewRisks Related to Regulatory Approval of Cytisinicline and Other Legal Compliance Matters
care organizations, establishes annual fees and taxes on manufacturers of specified branded prescription products, and promotes a new Medicare Part D coverage gap discount program
The Inflation Reduction Act and other pricing regulations could limit our ability to price and obtain reimbursement for cytisinicline.
NewRisks Related to our Business Operations
development and maintenance of these systems, controls and processes is costly and requires ongoing monitoring and updating as technologies change and efforts to overcome security measures become increasingly sophisticated
A cyber-attack or data breach could compromise patient data, resulting in regulatory fines and substantial remediation costs.
NewRisks Related to Our Reliance on Third Parties
Sopharma and other CMOs could breach or terminate their agreement with us
Sopharma and other contract manufacturing organizations could breach or terminate their agreements with us.
NewRisks Related to Commercialization of Cytisinicline
To achieve commercial success for cytisinicline, if approved, we will need to establish or outsource critical distribution, marketing and sales capabilities
We have partnered with Omnicom to support the commercial launch of cytisinicline, requiring significant upfront financial commitments before FDA approval.
NewRisks Related to Commercialization of Cytisinicline
unforeseen costs and expenses associated with creating and outsourcing critical commercial functions
We may fail to establish profitable third-party arrangements to sell, market, and distribute cytisinicline outside the United States.
NewRisks Related to Commercialization of Cytisinicline
too intense or risky, or cytisinicline’s patent protection insufficient, and/or third parties may not view cytisinicline as having sufficient potential for commercialization, including the likelihood of an adequate safety and efficacy profile
Inability to find suitable collaborators for cytisinicline would force us to fund commercialization alone, which we may not be able to afford.
NewRisks Related to our Intellectual Property
biotechnology and pharmaceutical industries expand and more patents are issued, the risk increases that our product candidate may be subject to claims of infringement of the patent rights of third parties
Third-party patent infringement claims could force us to pay substantial damages or block our ability to commercialize cytisinicline.
NewRisks Related to Our Common Stock
of the U.S. income tax base) and (iv) a one-time tax on accumulated offshore earnings held in cash and illiquid assets, with the latter taxed at a lower rate
Tax law changes restoring immediate deductibility for U.S. research expenditures still require 15-year amortization for foreign research costs.

Dropped

DroppedRisks Related to Our Financial Condition and Capital Requirements
As of December 31, 2024, the principal amounts due under our debt instruments (including the New Debt Agreement, as defined and further described under the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”) totaled $10.0 million
DroppedRisks Related to the Development of Our Product Candidate Cytisinicline
We are dependent upon a single company for the manufacture and supply of cytisinicline
Principal debt totaled $10.0 million as of December 31, 2024.
DroppedRisks Related to the Development of Our Product Candidate Cytisinicline
product liability claims may include allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in the product, negligence, strict liability, and a breach of warranties. Claims could also be asserted under state consumer protection acts
DroppedRisks Related to the Development of Our Product Candidate Cytisinicline
We conduct clinical trials internationally, which may trigger additional risks
DroppedRisks Related to Regulatory Approval of Cytisinicline and Other Legal Compliance Matters
have a material adverse effect on our business. Further, future government shutdowns or delays could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations
DroppedRisks Related to our Business Operations
agreements permit those executives to terminate their employment with us at any time, subject to providing us with advance written notice
DroppedRisks Related to Our Reliance on Third Parties
of our potential third-party manufacturers to comply with applicable regulations may result in long delays and interruptions to our product candidate supply while we seek to secure another supplier that meets all regulatory requirements
DroppedRisks Related to Our Reliance on Third Parties
such as nitrosamines, are discovered in quantities above regulators’ thresholds within our supply of cytisinicline, we may potentially delay product development and approval or have a material adverse impact on our business
DroppedRisks Related to Commercialization of Cytisinicline
2020, the U.S. Supreme Court held unanimously that federal law does not preempt the states’ ability to regulate pharmaceutical benefit managers and other members of the health care and pharmaceutical supply chain, an important decision that may lead to further and more aggressive efforts by states in this area
DroppedRisks Related to Our Common Stock
In addition, beginning in 2022, tax legislation requires research and experimental expenditures to be capitalized and amortized ratably over a five-year period. Any such expenditures attributable to research conducted outside the United States must be capitalized and amortized over a 15-year period

Reworded

86% rewrittenRisks Related to the Development of Our Product Candidate Cytisinicline
The development and commercialization of our product candidate is dependent upon securing sufficient quantities of cytisinicline from plant sources, which grow outside of the United States in a limited number of locations
Added China to the list of geographic sources for cytisinicline and warned that host countries might restrict exportation.
Was: The development and commercialization of our product candidate is dependent upon securing sufficient quantities of cytisinicline from trees and other plants, which grow outside of the United States in a limited number of locations
80% rewrittenRisks Related to Regulatory Approval of Cytisinicline and Other Legal Compliance Matters
Healthcare legislative and executive reform measures may have a material adverse effect on our business, financial condition or results of operations
Updated healthcare reform references to omit specific mentions of Medicaid managed care expansion.
73% rewrittenRisks Related to the Development of Our Product Candidate Cytisinicline
Results of earlier clinical trials of cytisinicline are not necessarily predictive of future results, and any advances of cytisinicline into clinical trials may not have favorable results or receive regulatory approval
Clarified that future clinical trials may fail to match earlier positive results.
72% rewrittenRisks Related to our Business Operations
Our future success depends in part on our ability to attract, retain, and motivate other qualified personnel
Updated the roster of executive officers, replacing Thomas B. King, Craig Donnelly, and Erik Atkisson.
71% rewrittenRisks Related to Our Financial Condition and Capital Requirements
the terms of any new collaborative, licensing, commercialization and other arrangements that we may establish
Added a disclosure that failure to raise funds may force us to explore asset sales or bankruptcy.
70% rewrittenRisks Related to Our Reliance on Third Parties
Each of these risks could delay our clinical trials, the approval, if any, of cytisinicline by the FDA or the commercialization of cytisinicline or result in higher costs or deprive us of potential product revenue
Expanded manufacturing risks to explicitly mention contamination, shutdowns, and operator error.
68% rewrittenRisks Related to Our Financial Condition and Capital Requirements
Our cash and cash equivalents could be adversely affected if the financial institutions in which we hold our cash and cash equivalents fail
Refined the bank deposit risk to reflect ongoing reliance on Silicon Valley Bank.
60% rewrittenRisks Related to our Business Operations
Our internal computer systems, or those of our third-party collaborators or other service providers, may fail or suffer security breaches and cyber-attacks, which could result in a material disruption of our development programs
Maintained standard data security and privacy evolution risk language.
57% rewrittenRisks Related to Commercialization of Cytisinicline
We may attempt to form collaborations in the future with respect to cytisinicline, but we may not be able to do so, which may cause us to alter our development and commercialization plans
50% rewrittenRisks Related to the Development of Our Product Candidate Cytisinicline
Cytisinicline is currently our sole product candidate and there is no guarantee that we will be able to successfully obtain approval from the FDA or other regulatory agencies to commercialize cytisinicline
Was: Cytisinicline is currently our sole product candidate and there is no guarantee that we will be able to successfully develop and commercialize cytisinicline
47% rewrittenRisks Related to Commercialization of Cytisinicline
Increasing efforts by governmental and private payors in the United States and abroad to limit or reduce healthcare costs may result in restrictions on coverage and the level of reimbursement for new products
42% rewrittenRisks Related to Regulatory Approval of Cytisinicline and Other Legal Compliance Matters
If we do not obtain the necessary regulatory approvals in the United States and/or other countries, we will not be able to sell cytisinicline
39% rewrittenRisks Related to Regulatory Approval of Cytisinicline and Other Legal Compliance Matters
A Breakthrough Therapy designation by the FDA and our receipt of a CNPV may not lead to a faster development or regulatory review or approval process for the nicotine e-cigarette/vaping cessation indication and it does not increase the likelihood that our product candidates will receive marketing approval
Was: A Breakthrough Therapy designation by the FDA may not lead to a faster development or regulatory review or approval process for the vaping/ e-cigarette cessation indication and it does not increase the likelihood that our product candidates will receive marketing approval
37% rewrittenRisks Related to Our Common Stock
If we raise additional capital, the terms of the financing transactions may cause dilution to existing stockholders or contain terms that are not favorable to us
36% rewrittenRisks Related to Our Common Stock
A significant portion of our total outstanding shares of common stock may be sold into the public market at any point, which could cause the market price of our common stock to drop significantly, even if our business is doing well, and result in significant dilution to our stockholders
33% rewrittenRisks Related to the Development of Our Product Candidate Cytisinicline
Our business may be negatively affected by weather conditions, natural disasters, and the availability of natural resources, as well as by climate change
28% rewrittenRisks Related to our Intellectual Property
Third-party claims of intellectual property infringement may prevent or delay our development and commercialization efforts
28% rewrittenRisks Related to Our Common Stock
U.S. federal tax reform and changes in other tax laws could increase our tax burden and adversely affect our business and financial condition
24% rewrittenRisks Related to the Development of Our Product Candidate Cytisinicline
Any of these events could prevent us from achieving or maintaining market acceptance of cytisinicline, even if approved, and could significantly harm our business, results of operations, and prospects
24% rewrittenRisks Related to Regulatory Approval of Cytisinicline and Other Legal Compliance Matters
Even if we obtain regulatory approval for cytisinicline, we will remain subject to ongoing regulatory requirements in connection with the sale and distribution of cytisinicline

All 78 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Financial Condition and Capital Requirements

01the terms of any new collaborative, licensing, commercialization and other arrangements that we may establish71% rewritten
02We have incurred substantial debt, which could impair our flexibility and access to capital and adversely affect our financial position, and our business would be materially adversely affected if we are unable to service our debt obligationsNew
03Our existing and any future indebtedness may limit our cash resources available to invest in the ongoing needs of our business
04placing us at a competitive disadvantage compared to our competitors that have less debt or better debt servicing options
05We are a late-stage clinical specialty pharmaceutical company with a limited operating history, are not profitable, have incurred losses in each year since our inception and expect to continue incurring losses for the foreseeable future
06require additional studies to support regulatory approval and commercialization
07We have never generated any revenue from product sales and may never be profitable
08attracting, hiring, and retaining qualified personnel
09Our cash and cash equivalents could be adversely affected if the financial institutions in which we hold our cash and cash equivalents fail68% rewritten
10maintain deposits fails or is subject to adverse conditions in the financial or credit markets, we may not be able to recover all, if any, of our deposits, which could adversely impact our operating liquidity and financial performanceNew

Risks Related to the Development of Our Product Candidate Cytisinicline

11Cytisinicline is currently our sole product candidate and there is no guarantee that we will be able to successfully obtain approval from the FDA or other regulatory agencies to commercialize cytisinicline50% rewritten
12The development and commercialization of our product candidate is dependent upon securing sufficient quantities of cytisinicline from plant sources, which grow outside of the United States in a limited number of locations86% rewritten
13The FDA may not grant marketing approval of cytisinicline without additional clinical or nonclinical studies, or at all New
14Results of earlier clinical trials of cytisinicline are not necessarily predictive of future results, and any advances of cytisinicline into clinical trials may not have favorable results or receive regulatory approval73% rewritten
15Clinical trials are costly, time consuming and inherently risky, and we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities. Any advances of cytisinicline into clinical trials may not have favorable results or receive regulatory approvalNew
16delays in the manufacture or packaging of sufficient quantities of cytisinicline for use in clinical trials
17Cytisinicline may cause undesirable side effects or have other properties that could delay or prevent regulatory approval, limit the commercial viability of an approved label, or result in significant negative consequences following marketing approval, if any
18Any of these events could prevent us from achieving or maintaining market acceptance of cytisinicline, even if approved, and could significantly harm our business, results of operations, and prospects24% rewritten
19Our business may be negatively affected by weather conditions, natural disasters, and the availability of natural resources, as well as by climate change33% rewritten
20We may use our financial and human resources to pursue a particular research program or product candidate and fail to capitalize on programs or product candidates that may be more profitable or for which there is a greater likelihood of success

Risks Related to Regulatory Approval of Cytisinicline and Other Legal Compliance Matters

21If we do not obtain the necessary regulatory approvals in the United States and/or other countries, we will not be able to sell cytisinicline42% rewritten
22Healthcare legislative and executive reform measures may have a material adverse effect on our business, financial condition or results of operations80% rewritten
23care organizations, establishes annual fees and taxes on manufacturers of specified branded prescription products, and promotes a new Medicare Part D coverage gap discount programNew
24Our ability to obtain services, reimbursement or funding may be impacted by possible reductions in federal spending in the United States as well as globally
25Even if we obtain regulatory approval for cytisinicline, we will remain subject to ongoing regulatory requirements in connection with the sale and distribution of cytisinicline24% rewritten
26Ongoing post-approval monitoring and clinical trial obligations may be costly to us and the failure to meet such obligations may result in the withdrawal of such approvals
27require a product recall
28We may be subject, directly or indirectly, to federal and state healthcare fraud and abuse laws, false claims laws, and health information privacy and security laws. If we are unable to comply, or have not fully complied, with such laws, we could face substantial penalties
29Our employees, independent contractors, consultants, commercial partners, principal investigators, or CROs may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business
30A Breakthrough Therapy designation by the FDA and our receipt of a CNPV may not lead to a faster development or regulatory review or approval process for the nicotine e-cigarette/vaping cessation indication and it does not increase the likelihood that our product candidates will receive marketing approval39% rewritten

Risks Related to our Business Operations

31It is difficult to evaluate our current business, predict our prospects and forecast our financial performance and growth
32Our future success depends in part on our ability to attract, retain, and motivate other qualified personnel72% rewritten
33We will need to expand our organization and we may experience difficulties in managing this growth, which could disrupt our operations
34We plan to invest in the development of additional indications for cytisinicline. If we invest in and are unsuccessful in developing additional indications for cytisinicline, our business, financial condition and results of operations may be adversely affected
35Our internal computer systems, or those of our third-party collaborators or other service providers, may fail or suffer security breaches and cyber-attacks, which could result in a material disruption of our development programs60% rewritten
36development and maintenance of these systems, controls and processes is costly and requires ongoing monitoring and updating as technologies change and efforts to overcome security measures become increasingly sophisticatedNew

Risks Related to Our Reliance on Third Parties

37Sopharma and other CMOs could breach or terminate their agreement with usNew
38Each of these risks could delay our clinical trials, the approval, if any, of cytisinicline by the FDA or the commercialization of cytisinicline or result in higher costs or deprive us of potential product revenue70% rewritten
39We may not be able to establish or maintain the third-party relationships that are necessary to develop or potentially commercialize cytisinicline
40We may be unable to realize the potential benefits of any collaborations which we may enter into with other companies for the development and commercialization of cytisinicline
41We enter into various contracts in the normal course of our business in which we indemnify the other party to the contract. In the event we have to perform under these indemnification provisions, it could have a material adverse effect on our business, financial condition and results of operations

Risks Related to Commercialization of Cytisinicline

42To achieve commercial success for cytisinicline, if approved, we will need to establish or outsource critical distribution, marketing and sales capabilitiesNew
43unforeseen costs and expenses associated with creating and outsourcing critical commercial functionsNew
44We face substantial competition, and our competitors may discover, develop or commercialize products faster or more successfully than us
45availability of cytisinicline from other suppliers and/or distributors
46Increasing efforts by governmental and private payors in the United States and abroad to limit or reduce healthcare costs may result in restrictions on coverage and the level of reimbursement for new products47% rewritten
47Sopharma may breach its supply agreement with us and sell cytisinicline into our territories or permit third parties to export cytisinicline into our territories and negatively affect our commercialization efforts of our products in our territories
48The illegal distribution and sale by third parties of counterfeit versions of cytisinicline, stolen products, or alternative third-party distribution and sale of cytisinicline could have a negative impact on our financial performance or reputation
49We may attempt to form collaborations in the future with respect to cytisinicline, but we may not be able to do so, which may cause us to alter our development and commercialization plans57% rewritten
50too intense or risky, or cytisinicline’s patent protection insufficient, and/or third parties may not view cytisinicline as having sufficient potential for commercialization, including the likelihood of an adequate safety and efficacy profileNew
51We may not be successful in any efforts to identify, license, discover, develop, or commercialize additional product candidates
52a potential product candidate may not be accepted as safe and effective by patients, the medical community, or third-party payors

Risks Related to our Intellectual Property

53If we are unable to maintain effective proprietary rights for our product candidate or any future product candidates, we may not be able to compete effectively in our proposed markets
54Third-party claims of intellectual property infringement may prevent or delay our development and commercialization efforts28% rewritten
55biotechnology and pharmaceutical industries expand and more patents are issued, the risk increases that our product candidate may be subject to claims of infringement of the patent rights of third partiesNew
56Although we rely or will rely in part on trade secret protection as part of our intellectual property rights strategies, we also intend to rely on patent rights to protect certain aspects of our technologies and upon the patent rights of third parties from which we license certain of our technologies
57Changes in patent law could diminish the value of patents in general, thereby impairing our ability to protect our product candidates
58We may be subject to claims that our employees, consultants, or independent contractors have wrongfully used or disclosed confidential information of third parties or that our employees have wrongfully used or disclosed alleged trade secrets of their former employers
59It is difficult and costly to protect our proprietary rights and as a result we may not be able to ensure their protection. In addition, patents have a limited lifespan and will eventually expire
60there may be significant pressure on the U.S. government and international governmental bodies to limit the scope of available patent protection both inside and outside the United States for disease treatments that prove successful, as a matter of public policy regarding worldwide health concerns
61Obtaining and maintaining our patent protection depends on compliance with various procedural, documentary, fee payment, and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for noncompliance with these requirements
62We may be involved in lawsuits to protect or enforce our patents or the patents of our licensors, which could be expensive, time consuming, and unsuccessful
63We or our licensors may not be able to protect our intellectual property rights throughout the world

Risks Related to Our Common Stock

64The price for our common stock is volatile
65tweets or other social media posts related to our market and industry
66A significant portion of our total outstanding shares of common stock may be sold into the public market at any point, which could cause the market price of our common stock to drop significantly, even if our business is doing well, and result in significant dilution to our stockholders36% rewritten
67If we raise additional capital, the terms of the financing transactions may cause dilution to existing stockholders or contain terms that are not favorable to us37% rewritten
68We are a smaller reporting company and we cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies will make our common stock less attractive to investors
69If equity research analysts do not publish research or reports, or publish unfavorable research or reports, about us, our business, or our market, our stock price and trading volume could decline
70We are at risk of securities class action litigation
71We incur costs and demands upon management as a result of complying with the laws and regulations affecting public companies
72Shareholder activists could cause a disruption to our business
73Anti-takeover provisions under Delaware law could make an acquisition of us more difficult and may prevent attempts by our stockholders to replace or remove our management
74Our bylaws provide that the Court of Chancery of the State of Delaware is the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees
75Failure to maintain effective internal control over financial reporting could have a material adverse effect on our reputation, results of operations and financial condition
76Because our merger resulted in an ownership change under Section 382 of the U.S. Internal Revenue Code for OncoGenex, pre-merger net operating loss carryforwards and certain other tax attributes are now subject to limitations
77U.S. federal tax reform and changes in other tax laws could increase our tax burden and adversely affect our business and financial condition28% rewritten
78of the U.S. income tax base) and (iv) a one-time tax on accumulated offshore earnings held in cash and illiquid assets, with the latter taxed at a lower rateNew

Other Achieve Life Sciences 10-Ks

FY2024 10-K risk factors
76 risks
Achieve Life Sciences relies entirely on a single clinical product candidate, cytisinicline, sourced from a single Bulgarian supplier, Sopharma AD. The company faces significant financial risks, including $10.0 million in debt as of December 31, 2024, and a complete lack of product revenue.
Filed Mar 11, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.