Cognition Therapeutics (CGTX) risk factors, FY2025 10-K

Risks Related to Our Financial Position and Capital Needs

1. 01We are a clinical-stage biopharmaceutical company with no products approved for commercial sale and have incurred significant losses since our inception in 2007. We expect to incur significant losses over the foreseeable future and may never achieve or maintain profitability
2. 02We have completed, Phase 2 clinical trials, but have no history of commercializing products, which may make it difficult for an investor to evaluate the success of our business to date and to assess our future viability
3. 03We will need substantial additional capital to meet our financial obligations in the future and to pursue our business objectives. If we are unable to raise capital when needed, we could be forced to curtail our planned operations and the pursuit of our growth strategy21% rewritten
4. 04The economic environment may make it difficult to raise capital on acceptable terms or at all
5. 05To date, we have partially relied on non-dilutive grants to cover certain of our capital requirements for our clinical trials, and we may fail to continue to receive non-dilutive funding
6. 06We could be subject to audit and repayment of our non-dilutive NIA Grants
7. 07Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations

Risks Related to Discovery, Development and Regulatory Approval of Our Product Candidates

1. 08Our business is heavily dependent on the successful development, regulatory approval and commercialization of zervimesine and any future product candidates that we may develop or acquire
2. 09We may not successfully expand our pipeline of product candidates, including by pursuing additional indications for zervimesine or by in-licensing or acquiring additional product candidates for other diseases
3. 10Research and development of pharmaceuticals is inherently risky. We cannot give any assurance that any of our product candidates will receive regulatory approval
4. 11We may encounter substantial delays in our preclinical studies and clinical trials or may not be able to conduct or complete our preclinical studies or clinical trials on the timelines we expect, if at all
5. 12If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected
6. 13Our product candidates may cause undesirable and unforeseen side effects or have other properties that could halt their clinical development, delay or prevent their regulatory approval, limit their commercial potential or result in significant negative consequences
7. 14Any of these events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved, and result in the loss of significant revenues to us, which would materially and adversely affect our business, financial condition, results of operations and prospects
8. 15Interim “top-line” and preliminary data from studies or trials that we announce or publish from time to time may change as more data become available and are subject to audit and verification procedures that could result in material changes in the final data
9. 16We have initially concentrated our research and development efforts on the treatment of AD and DLB, diseases that have seen limited success in drug development39% rewritten
10. 17We have never conducted pivotal clinical trials, and we may be unable to do so for any product candidates we may develop
11. 18A Breakthrough Therapy designation by the FDA, even if granted for any of our product candidates, may not lead to a faster development or regulatory review or approval process, and it does not increase the likelihood that our product candidates will receive marketing approval
12. 19A Fast Track designation by the FDA, even if granted for any of our product candidates, may not lead to a faster development or regulatory review or approval process, and does not increase the likelihood that our product candidates will receive marketing approval36% rewritten
13. 20We have conducted, and in the future plan to conduct, clinical trials for product candidates outside the United States, and the FDA and comparable foreign regulatory authorities may not accept data from such trials
14. 21If we are not successful in identifying, developing and commercializing additional product candidates, our ability to expand our business and achieve our strategic objectives would be impaired
15. 22Even if the product candidates that we develop receive regulatory approval in the United States or another jurisdiction, they may never receive approval in other jurisdictions, which would limit market opportunities for our product candidates and adversely affect our business

Risks Related to Our Business and Industry

1. 23We are heavily dependent on the success of zervimesine, our lead product candidate, which is still under clinical development, and if zervimesine does not receive regulatory approval or is not successfully commercialized, our business may be harmed
2. 24We will need to increase the size of our organization, and we may experience difficulties in managing growth
3. 25If we fail to attract and retain senior management and key scientific personnel, our business may be materially and adversely affected
4. 26If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our current or future product candidates
5. 27We may explore strategic collaborations that may never materialize or may fail
6. 28We may seek to grow our business through acquisitions of complementary businesses, and the failure to manage acquisitions, or the failure to integrate them with our existing business, could harm our financial condition and operating results
7. 29Significant disruptions of information technology systems and infrastructure, data breaches and other cybersecurity incidents could materially adversely affect our business, results of operations and financial condition
8. 30Failure to comply with health and data protection laws and regulations could lead to government enforcement actions and civil or criminal penalties, private litigation or adverse publicity and could negatively affect our operating results and business71% rewritten
9. 31Moreover, clinical trial subjects about whom we or any of our potential collaborators obtain information, as well as the providers who share this information with us, may contractually limit our ability to use and disclose the informationNew
10. 32The use of new and evolving technologies, such as artificial intelligence, in our business may result in risks and challenges that can impact our business, including by posing security and other risks to our confidential and/or proprietary information, including personal informationNew
11. 33Environmental, social and governance matters may impact our business and reputation

Risks Related to Our Intellectual Property

1. 34If we are unable to obtain and maintain patent protection for our technology and product candidates including our lead product candidate, zervimesine, or if the scope of the patent protection obtained is not sufficiently broad, we may not be able to compete effectively in our markets
2. 35We may not be able to protect our intellectual property rights throughout the world
3. 36Patent terms may be inadequate to protect our competitive position on our product candidates including our lead product candidate, zervimesine, for an adequate amount of time
4. 37If we do not obtain protection under the Hatch-Waxman Amendments by obtaining data exclusivity, our business may be harmed
5. 38The validity, scope and enforceability of any patents listed in the Orange Book that cover our product candidates including our lead product candidate zervimesine can be challenged by third parties
6. 39Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for noncompliance with these requirements
7. 40We may need to license intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms
8. 41Third-party claims or litigation alleging infringement of patents or other proprietary rights, or seeking to invalidate patents or other proprietary rights, may delay or prevent the development and commercialization of any of our product candidates including our lead product candidate, zervimesine
9. 42We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent, which might harm our ability to develop and market our products
10. 43We may become involved in lawsuits to protect or enforce our patents or our other intellectual property rights, which could be expensive, time consuming and unsuccessful
11. 44Because of the expense and uncertainty of litigation, we may not be in a position to enforce our intellectual property rights against third parties
12. 45Changes in U.S. patent law or the patent law of other countries or jurisdictions could diminish the value of patents in general, thereby impairing our ability to protects our product including our lead product candidate, zervimesine
13. 46We may not be able to protect our intellectual property rights throughout the world, which could impair our business
14. 47Our reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our trade secrets will be misappropriated or disclosed
15. 48We may be subject to claims that our employees, consultants, independent contractors or we have wrongfully used or disclosed confidential information of their former employers or other third parties
16. 49We may be subject to claims challenging the inventorship or ownership of our patents and other intellectual property
17. 50Intellectual property litigation could cause us to spend substantial resources and distract our personnel from their normal responsibilities, and have a harmful effect on the success of our business
18. 51If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed
19. 52Any trademarks we have obtained or may obtain may be infringed or successfully challenged, resulting in harm to our business
20. 53Our intellectual property agreements with third parties may be subject to disagreements over contract interpretation, which could narrow the scope of our rights to the relevant intellectual property or technology
21. 54Intellectual property rights do not necessarily address all potential threats to our competitive advantage

Risks Related to Commercialization, Manufacturing and Reliance on Third Parties

1. 55Even if our current or future product candidates obtain regulatory approval, they may fail to achieve the broad degree of adoption and use by physicians, patients, hospitals, healthcare payors and others in the medical community necessary for commercial success
2. 56The market opportunities for zervimesine, if approved, may be smaller than we anticipate
3. 57We rely on third parties in the conduct of all of our clinical trials. If these third parties do not successfully carry out their contractual duties, fail to comply with applicable regulatory requirements or meet expected deadlines, we may be unable to obtain regulatory approval for our product candidates
4. 58We currently have no sales organization. If we are unable to establish sales capabilities on our own or through third parties, we may not be able to market and sell our product candidates, if approved, effectively in the United States and foreign jurisdictions or generate product revenue

Risks Related to Government Regulation

1. 59Even if we obtain regulatory approval for a product candidate, our products will remain subject to regulatory scrutiny
2. 60Healthcare legislation, including potentially unfavorable pricing regulations or other healthcare reform initiatives, may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates76% rewritten
3. 61If we develop a small molecule product candidate that obtains regulatory approval, additional competitors could enter the market with generic versions of such drugs, which may result in a material decline in sales of affected products
4. 62Our business operations and current and future relationships with investigators, healthcare professionals, consultants, third-party payors, patient organizations and customers will be subject to applicable healthcare regulatory laws, which could expose us to penalties88% rewritten
5. 63Changes in tax laws and regulations may have a material adverse effect on our business, financial condition and results of operations36% rewritten
6. 64Existing regulatory policies may change, and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates
7. 65The U.S. Congress, the Trump administration, or any new administration may make substantial changes to fiscal, tax, and other federal policies that may adversely affect our business

Risks Related to Our Common Stock

1. 66Our stock price may be volatile, and you may not be able to resell shares of our common stock at or above the price you paid
2. 67We are an “emerging growth company” and a “smaller reporting company” and, as a result of the reduced disclosure and governance requirements applicable to emerging growth companies and smaller reporting companies, our common stock may be less attractive to investors
3. 68If we sell shares of our common stock in future financings, stockholders may experience dilution and, as a result, our stock price may decline
4. 69Sales of a substantial number of shares of our common stock in the public market could cause our stock price to fall37% rewritten
5. 70Our ability to use net operating loss carryforwards and other tax attributes may be limited34% rewritten
6. 71Provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable and may lead to entrenchment of management37% rewritten
7. 72State of Delaware dismisses any such action for lack of subject matter jurisdiction, such action may be brought in another state or federal court sitting in the State of DelawareNew
8. 73We do not currently intend to pay dividends on our common stock, and, consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our common stock
9. 74Unfavorable global economic or political conditions has in the past and could in the future adversely affect our business, financial condition or results of operations
10. 75Adverse developments affecting the financial services industry, including events or concerns involving liquidity, defaults or non-performance by financial institutions or transactional counterparties, could adversely affect our business, financial condition or results of operations
11. 76If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our stock, our stock price and trading volume could decline
12. 77We may be subject to securities litigation, which is expensive and could divert our management’s attention
13. 78We have incurred, and will continue to incur, increased costs and demands upon management as a result of being a public company