Acurx Pharmaceuticals (ACXP) risk factors, FY2024 10-K

Risks Relating to Our Business

1. 01We are a clinical-stage company and have a limited operating history, which may make it difficult to evaluate our current business and predict our future performance
2. 02We have incurred significant net losses in each period since our inception and anticipate that we will continue to incur net losses in for the foreseeable future and may never achieve or maintain profitability
3. 03Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern
4. 04We may need substantial additional funding. If we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our product development programs or commercialization efforts
5. 05Raising additional capital may cause dilution to our existing stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates
6. 06We are reliant on the success of our lead product candidate, ibezapolstat, which we are developing for the treatment of CDI. If we are unable to commercialize ibezapolstat, or experience significant delays in doing so, our business will be materially harmed
7. 07If serious adverse or inappropriate side effects are identified during the development of ibezapolstat or any other product candidate, we may need to abandon or limit our development of that product candidate
8. 08Ibezapolstat or our other product candidates may never achieve sufficient market acceptance even if we obtain regulatory approval
9. 09We are exposed to product liability, and non-clinical and clinical liability risks which could place a substantial financial burden upon us, should lawsuits be filed against us
10. 10Our current and future operations substantially depend on our management team and our ability to hire other key personnel, the loss of any of whom could disrupt our business operations
11. 11Our failure to complete or meet key milestones relating to the development of our technologies and proposed products and formulations would significantly impair our financial condition
12. 12Conducting and completing the clinical trials necessary for FDA approval is costly and subject to intense regulatory scrutiny as well as the risk of failing to meet the primary endpoint of such trials. We will not be able to commercialize and sell our proposed products and formulations without completing such trials
13. 13We will compete with larger and better capitalized companies, and competitors in the drug development or pharmaceutical industries may develop competing products which outperform or supplant our proposed products
14. 14We may not be able to effectively manage our growth and expansion or implement our business strategies, in which case our business and results of operations may be materially and adversely affected
15. 15A pandemic, epidemic, or outbreak of an infectious disease, such as the COVID-19 pandemic, could materially and adversely affect our business
16. 16Global, market and economic conditions may negatively impact our business, financial condition and share price
17. 17Climate change or legal, regulatory or market measures to address climate change may negatively affect our business, results of operations, cash flows and prospects
18. 18market risk and reputational risk) and social and human effects (such as population dislocations and harm to health and well-being) associated with climate change. These risks can be either acute (short-term) or chronic (long-term)
19. 19The insurance coverage and reimbursement status of newly approved products is uncertain. Failure to obtain or maintain adequate coverage and reimbursement for new or current products could limit our ability to market those products and decrease our ability to generate revenue

Risks Related to Regulatory Approval

1. 20Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that believe their product candidates performed satisfactorily in preclinical studies and clinical trials have failed to obtain marketing approval of their products
2. 21If we experience any of a number of possible unforeseen events in connection with our clinical trials, potential marketing approval or commercialization of our product candidates could be delayed or prevented
3. 22If we experience delays or difficulties in the enrollment of patients in our clinical trials, our receipt of necessary marketing approvals could be delayed or prevented
4. 23We may be unable to obtain regulatory approval in the United States or foreign jurisdictions and, as a result, be unable to commercialize our product candidates and our ability to generate revenue will be materially impaired
5. 24safe-use criteria, and requiring treated patients to enroll in a registry, among other requirements. These limitations and restrictions may limit the size of the market for the product and affect reimbursement by third-party payors
6. 25Our product candidates for which we obtain approval may face competition sooner than anticipated
7. 26Risks associated with operating in foreign countries could materially adversely affect our product development should we elect to extend development outside the U.S
8. 27Our results of operations may be adversely affected by current and potential future healthcare legislative and regulatory actions

Risks Related to Our Dependence on Third Parties

1. 28If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell our product candidates, we may not be successful in commercializing ibezapolstat or any other product candidate if and when such product candidates are approved
2. 29If ultimate users of our product candidates are unable to obtain adequate reimbursement from third-party payers, or if new restrictive legislation is adopted, market acceptance of our proposed products may be limited and we may not achieve material revenues
3. 30Our relationships with future customers and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings

Risks Related to Intellectual Property

1. 31We may be involved in lawsuits to protect or enforce our patents
2. 32Intellectual property litigation could cause us to spend substantial resources and distract our personnel from their normal responsibilities
3. 33We may need to license certain intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms
4. 34If we are unable to adequately protect or enforce our rights to intellectual property or secure rights to third-party patents, we may lose valuable rights, experience reduced market share, assuming any, or incur costly litigation to enforce, maintain or protect such rights
5. 35If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed

Risks Related to Our Common Stock

1. 36Because we do not anticipate paying any cash dividends on our common stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain
2. 37Provisions in our corporate charter documents and under Delaware law could make an acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management
3. 38We are an “emerging growth company,” and a “smaller reporting company” and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies and smaller reporting companies will make our common stock less attractive to investors
4. 39We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile
5. 40The price of our stock may be volatile, and you could lose all or part of your investment
6. 41Our largest stockholders will exercise significant influence over our company for the foreseeable future, including the outcome of matters requiring stockholder approval
7. 42On February 24, 2025, we received a letter from The Nasdaq Stock Market (“Nasdaq”) notifying us that for the preceding 31 consecutive business days our common stock did not maintain a minimum closing bid price of $1.00 per share as required by Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”)
8. 43The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain qualified board members
9. 44Cyber incidents or attacks directed at us could result in information theft, data corruption, operational disruption and/or financial loss
10. 45We may fail to comply with evolving privacy and data protection laws, which could adversely affect our business, results of operations and financial condition
11. 46We also continue to see jurisdictions imposing data localization laws. These regulations may interfere with our intended business activities, inhibit our ability to expand into those markets or prohibit us from continuing to offer services in those markets without significant additional costs
12. 47Our issuance of additional capital stock in connection with potential future financings, acquisitions, investments, our stock incentive plans or otherwise will dilute all other stockholders
13. 48Our employees, principal investigators, consultants and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading
14. 49There may be limitations on the effectiveness of our internal controls, and a failure of our control systems to prevent error or fraud may materially harm us
15. 50The estimates and judgments we make, or the assumptions on which we rely, in preparing our financial statements could prove inaccurate
16. 51Failure to comply with the United States Foreign Corrupt Practices Act could subject us to penalties and other adverse consequences
17. 52Litigation may adversely affect our business, financial condition and results of operations
18. 53If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could harm our business
19. 54If securities or industry analysts do not publish research or reports about our business, or they publish negative reports about our business, our share price and trading volume could decline
20. 55Delaware law contains anti-takeover provisions that could deter takeover attempts that could be beneficial to our stockholders