Armata Pharmaceuticals (ARMP) risk factors, FY2025 10-K

Risks Related to Our Financial Condition and Need for Additional Capital

1. 01We have incurred losses since our inception and anticipate that we will continue to incur significant losses for the foreseeable future, and our future profitability is uncertain
2. 02Clinical trials and activities associated with discovery research are costly. We do not expect to generate any revenue from the commercial sales of our product candidates in the near term, and we expect to continue to have significant losses for the foreseeable future28% rewritten
3. 03to generate revenues from the sale of any approved products, we may not become profitable and may need to obtain additional funding to continue operationsNew
4. 04If we fail to develop and maintain proper and effective processes and operating procedures as a non-traditional government contractor, our ability to adhere to the Department of Defense and related entity standards could impact our ongoing and future development financing awards from the U.S. government34% rewritten

Risks Related to Our Business

1. 05We are seeking to develop antibacterial agents using bacteriophage and synthetic phage technology, a novel approach, which makes it difficult to predict the time and cost of development. No bacteriophage products have been approved in the United States or elsewhere
2. 06In addition, the FDA or other regulatory agencies may lack experience in evaluating the safety and efficacy of drugs based on these approaches, which could lengthen the regulatory review process, increase our development costs and delay or prevent commercialization of our product candidates
3. 07Delays in our clinical trials could result in us not achieving anticipated developmental milestones when expected, increased costs and delay our ability to obtain regulatory approval for and commercialize our product candidates
4. 08We must continue to develop manufacturing processes for our product candidates and any delay in or our inability to do so would result in delays in our clinical trials
5. 09We need FDA approval prior to marketing our product candidates in the United States. If we fail to obtain FDA approval to market our product candidates, we will be unable to sell our products in the United States, which will significantly impair our ability to generate any revenues22% rewritten
6. 10sufficient by the FDA for approval or even to make our applications approvable. If any of these outcomes occur, we may be forced to abandon one or more of our applications for approval, which might significantly harm our business and prospectsNew
7. 11We may conduct clinical trials for our products or product candidates outside the United States and the FDA may not accept data from such trials
8. 12We are subject to significant regulatory approval requirements, which could delay, prevent or limit our ability to market our product candidates
9. 13We rely on third parties to conduct our clinical trials and to obtain materials or supplies necessary to conduct trials or to manufacture our product candidates, and their failure to perform their obligations in a timely or competent manner may delay development and commercialization of our product candidates
10. 14Our business operations and current and future relationships with clinical site investigators, healthcare professionals , consultants, third-party payors, patient organizations, and customers will be subject to applicable healthcare regulatory laws, which could expose us to penalties
11. 15We face potential liability related to the privacy of health information we may obtain from the patients in our clinical trials if we fail to comply with privacy laws27% rewritten
12. 16We face potential risks associated with future changes in laws and policies, including the availability of government funding for grants, staffing and funding of regulatory agencies
13. 17The use or anticipated use of artificial intelligence (“AI”) technologies, including generative AI, by us or third parties, may increase or create new operational risks34% rewritten

Risks Related to Our Intellectual Property

1. 18Third parties may initiate legal proceedings alleging that we are infringing their intellectual property rights, the outcome of which would be uncertain and could significantly harm our business
2. 19We may not be able to protect our intellectual property rights throughout the world
3. 20If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed

Risks Related to Our Industry

1. 21There is a high rate of failure inherent in drug discovery and development, and failure can occur at any point in the process, including in later stages after substantial investment
2. 22We face substantial competition, which may result in others discovering, developing, or commercializing products before or more successfully than we do
3. 23If our competitors obtain marketing approval from the FDA, the EMA or other comparable regulatory authorities for their product candidates more rapidly than we do, it could result in our competitors establishing a strong market position before we are able to enter the market49% rewritten
4. 24and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programsNew
5. 25Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop
6. 26Even if we receive regulatory approval to market our product candidates, the market may not be receptive to our product candidates upon their commercial introduction, which would negatively affect our ability to achieve profitability
7. 27Current and future healthcare reform measures may affect our results of operations
8. 28Our business is subject to increasing government price controls and other public and private restrictions on pricing, reimbursement, and access for our drugs, which could have a material adverse effect on our results of operations, reputation or business

Risks Related to Our Common Stock

1. 29Innoviva, our principal stockholder , beneficially owns greater than 50% of our outstanding shares of Common Stock, which causes us to be deemed a “controlled company” under the rules of NYSE. In addition, Innoviva’s interests in our business may be different than our other stockholder s25% rewritten
2. 30the board of directors maintain a compensation committee comprised solely of independent directors and with a written charter addressing the committee’s purpose and responsibilities
3. 31The price of our securities has been volatile and may continue to be so, and purchasers of our securities could incur substantial losses43% rewritten
4. 32Raising additional capital may cause dilution to our stockholders, restrict our operations, and/or require us to relinquish rights to our technologies or product candidates
5. 33To the extent that we raise additional capital through the sale of equity or convertible loan securities, our stockholders’ interests will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our Common Stockholders
6. 34Unfavorable global economic conditions, whether brought about by material global crises, health epidemics, military conflicts or war, geopolitical and trade disputes or other factors, may adversely affect our business and financial results29% rewritten
7. 35Our operations could be disrupted by failure of our information systems or by successful cyber-attacks