AYTU Biopharma (AYTU) risk factors, 2026 10-K

Risks Related to Our Business and Financial Position

1. 01We have incurred losses to date and can give no assurance of profitability64% rewritten
2. 02We may not have cash available to us in an amount sufficient to enable us to make interest or principal payments on our indebtedness when due
3. 03The terms of our loan agreement place restrictions on our operating and financial flexibility. If we raise additional capital through debt financing, the terms of any new debt could further restrict our operating and financial flexibility
4. 04Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited
5. 05We have been and, in the future, may become a defendant in one or more stockholder derivative, class-action, and other litigation, and any such lawsuits may adversely affect our business, financial condition, results of operations and cash flows

Risks Related to Commercialization

1. 06We are heavily dependent on the commercial success of our commercial products. To date, we have not generated sufficient net revenue from the sales of these products to achieve company-wide profitability and we may never achieve or maintain profitability64% rewritten
2. 07We have incurred, and anticipate continuing to incur, significant costs associated with commercialization of our approved products and, if approved, any other product candidates that we may develop. It is possible that we will never attain sufficient product net revenue to achieve profitability28% rewritten
3. 08Our pharmaceutical products may prove to be difficult to effectively commercialize as planned or on the timeframes we announce and expect
4. 09We rely on limited sources of supply for our products, and any disruption in the chain of supply may impact production and sales of our products, and cause delays in developing and commercializing our currently manufactured and commercialized products
5. 10We rely on third parties to manufacture certain products, and third-party manufacturing risks and inefficiencies may result in costs and delays that prevent us from successfully commercializing products and adversely affect our ability to produce our products
6. 11We may not be able to meet the demand for our products if one or more of any third-party manufacturers is unable to supply us with the necessary components that meet our specifications. It may be difficult to find alternate suppliers for any of our products in a timely manner and on terms acceptable to us
7. 12Any of these actions, in combination or alone, could prevent us from marketing, distributing or selling our products, and would likely harm our business
8. 13We face substantial competition, including the introduction of generics, from companies with considerably more resources and experience than we have, which may result in others discovering, developing, receiving approval for, or commercializing products before or more successfully than us
9. 14obtain patent and/or other proprietary protection for our products
10. 15Government restrictions on pricing and reimbursement, as well as other healthcare payor cost-containment initiatives, may negatively impact our ability to generate net revenue
11. 16the availability of capital
12. 17Our financial results will depend on the acceptance among clinicians, third-party payors and the medical community of our products
13. 18general economic conditions
14. 19If third-party payors do not reimburse our customers for the products we sell or if reimbursement levels are set too low for us to sell one or more of our products at a profit, our ability to sell those products and our results of operations will be harmed
15. 20Third-party payors may deny reimbursement for covered products if they determine that a medical product was not used in accordance with cost-effective diagnosis methods, as determined by the third-party payor, or was used for an unapproved indication
16. 21Reporting and payment obligations under the Medicaid Drug Rebate Program and other governmental drug pricing programs are complex and may involve subjective decisions. Any failure to comply with those obligations could subject us to penalties and sanctions
17. 22Our future growth may depend, in part, on our ability to penetrate foreign markets, where we would be subject to additional regulatory burdens and other risks and uncertainties
18. 23We are subject to United States and foreign anti-corruption and anti-money laundering laws with respect to our operations and non-compliance with such laws can subject us to criminal and/or civil liability and harm our business
19. 24We are subject to various health care fraud and abuse and reimbursement laws pertaining to the marketing of our approved products
20. 25Adzenys and Cotempla contain controlled substances, and their manufacture, use, sale, importation, exportation, prescribing and distribution are subject to regulation by the DEA
21. 26Annual registration is required for any facility that manufactures, distributes, dispenses, imports or exports any controlled substance. The registration is specific to the particular location, activity and controlled substance schedule
22. 27The design, development, manufacture, supply and distribution of our products are technically complex and require regulatory compliance
23. 28There is a risk we may be unable to sell and distribute certain of our products if we cannot continue to comply with the serialization requirements of the Drug Quality and Security Act within the necessary time frames
24. 29Failure to comply with health and data protection laws and regulations could lead to United States federal and state government enforcement actions, including civil or criminal penalties, private litigation, and adverse publicity and could negatively affect our operating results and business
25. 30We may use hazardous chemicals and biological materials in our business. Any claims relating to improper handling, storage or disposal of these materials could be time-consuming and costly

Risks Related to Our Intellectual Property

1. 31A dispute concerning the infringement or misappropriation of our proprietary rights, or the proprietary rights of others could be time consuming and costly, and an unfavorable outcome could harm our business
2. 32injunctive or other equitable relief that may effectively block our ability to further develop, commercialize, and sell products; or
3. 33We are dependent on our relationships and license agreements, and we rely on the intellectual property rights granted to us pursuant to the license agreements
4. 34The expiration or loss of patent protection may adversely affect our future net revenue and operating results
5. 35Our ability to compete may decline if we do not adequately protect or enforce our intellectual property rights
6. 36If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed
7. 37We may not be able to enforce our intellectual property rights throughout the world

Risks Related to Our Organization, Structure and Operation

1. 38Our efforts to expand and transform our businesses may require significant investments; if our strategies are unsuccessful, our business, results of operations and/or financial condition may be materially adversely affected
2. 39difficulties due to lack of or limited prior experience in any new markets we may enter
3. 40We may have difficulties integrating acquired businesses or assets and such acquisitions may not result in the anticipated benefits, as a result, our business, results of operations and/or financial condition may be materially adversely affected
4. 41In fiscal 2026, the great majority of our gross revenue and gross accounts receivable were due to five significant customers, the loss of which could materially and adversely affect our results of operations25% rewritten
5. 42Our accounts receivable subjects us to credit risk
6. 43Product liability and other lawsuits could divert our resources, result in substantial liabilities and reduce the commercial potential of our products
7. 44We may be subject to legal or administrative proceedings and litigation other than product liability lawsuits which may be costly to defend and could materially harm our business, financial condition and operations
8. 45Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us
9. 46we may not retroactively amend our bylaw provisions to reduce our indemnification obligations to directors, officers, employees and agents
10. 47Public concern over the abuse of medications that are controlled substances, including increased legislative, legal and regulatory action, could negatively affect our business
11. 48Certain of our stockholders own a large percentage of our stock and their interests may conflict with yours

Risk Related to Securities Markets and Investment in Our Securities

1. 49Our failure to maintain compliance with Nasdaq's continued listing requirements could result in the delisting of our common stock, which could adversely affect the liquidity and market price of our common stock and our ability to raise capital99% rewritten
2. 50Effecting a reverse stock split, if determined by the Board in its discretion, may not achieve one or more of our objectives
3. 51Our share price is volatile and may be influenced by numerous factors, some of which are beyond our control
4. 52other events or factors, many of which are beyond our control
5. 53If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and any trading volume could decline
6. 54Some provisions of our charter documents and applicable Delaware law may discourage an acquisition of us by others, even if the acquisition may be beneficial to some of our stockholders
7. 55establishing advance notice requirements for nominations for election to the Board of Directors or for proposing matters that can be acted upon at stockholder meetings
8. 56We are and may continue to be subject to short-selling strategies
9. 57We are and may become involved in litigation or other proceedings from time to time relating to the enforcement or defense of patent and other intellectual property rights, which could cause us to divert our resources and could put our intellectual property at risk
10. 58Our business and operations would suffer in the event of system failures, cybersecurity attacks, data leakages or other security breaches
11. 59Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and stock price