Cingulate (CING) risk factors, FY2025 10-K

Other

1. 01The following summarizes key risks and uncertainties that could materially adversely affect us. You should read this summary together with the more detailed description of each risk factor contained below

Risks Related to Our Financial Position and Need for Capital

1. 02We are a biopharmaceutical company with a limited operating history21% rewritten
2. 03We have incurred a history of operating losses and expect to continue to incur substantial costs for the foreseeable future. We are not currently profitable, and we may never achieve or sustain profitability45% rewritten
3. 04We depend heavily on the success of CTx-1301. If we are unable to secure approval of CTx-1301, we will never be able to generate revenues from CTx-1301, and our ability to create stockholder value will be severely limited89% rewritten
4. 05We will need to raise significant additional capital to continue operations. If we are unable to raise capital, we could be required to seek bankruptcy protection or other alternatives that would likely result in our securityholders losing some or all of their investment in us
5. 06We cannot be certain that additional funding will be available on acceptable terms, or at all
6. 07In addition, future debt financing into which we may enter may impose upon us covenants that restrict our operations, including limitations on our ability to incur liens or additional debt, pay dividends, redeem our stock, make certain investments and engage in certain merger, consolidation or asset sale transactions
7. 08In November 2025, we entered into a Note Purchase Agreement with Avondale Capital, LLC, or Lender, pursuant to which we issued and sold to Lender an unsecured promissory note, or Note, in the amount of $6,570,000. The Note bears interest at a rate of 9% per annum and matures 18 months after its issuance date21% rewritten
8. 09Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our product candidates
9. 10Changes in tax laws may materially adversely affect our business, financial condition, results of operations and cash flows
10. 11Our ability to use our net operating losses to offset future taxable income may be subject to certain limitations
11. 12The report of our independent registered public accounting firm for the fiscal years ended December 31, 2025 and 2024 contains an explanatory paragraph regarding substantial doubt about our ability to continue as a going concern

Risks Related to Development, Clinical Testing, Manufacturing and Regulatory Approval

1. 13Premarket review of our product candidates by the FDA or other regulatory authorities is a lengthy and uncertain process and approval may be delayed, limited or denied, any of which would adversely affect our ability to generate operating revenues49% rewritten
2. 14We must ensure our CDMO complies with cGMP, and regulatory inspections or findings could interrupt supply and delay developmentNew
3. 15Disruptions at the FDA and other government agencies caused by funding shortages or otherwise could hinder their ability to hire and retain key leadership and other personnel, or otherwise review and process regulatory submissions in a timely manner, which could negatively impact our businessNew
4. 16Clinical testing is expensive, difficult to design and implement, can take many years to complete and is outcome uncertain. We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the commercialization of our product candidates
5. 17Obtaining regulatory approval for clinical trials of CTx-1301 and CTx-1302 in children and adolescents may require additional studies and/or longer duration of studies since the requirements for regulatory approval for the pediatric populations are more stringent56% rewritten
6. 18Changes in methods of product candidate manufacturing or formulation may result in additional costs or delay
7. 19Our product candidates CTx-1301 and CTx-1302 contain controlled substances, the manufacture, use, sale, importation, exportation, prescribing and distribution of which are subject to regulation by the DEA
8. 20Annual 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
9. 21If we experience delays or difficulties in the enrollment of subjects in clinical trials, our receipt of necessary regulatory approvals could be delayed or prevented
10. 22Our product candidates may cause adverse effects or have other properties that could delay or prevent their regulatory approval or limit the scope of any approved label or market acceptance, or result in significant negative consequences following marketing approval, if any
11. 23Any of these events could prevent us from achieving or maintaining market acceptance of the affected product or product candidate and could substantially increase the costs of commercializing our products and product candidates
12. 24Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our product candidates in other jurisdictions
13. 25We may be unable to successfully complete Phase 3 clinical trials for our product candidates21% rewritten
14. 26Even if we obtain regulatory approval for our product candidates, such approval may be limited, and we will be subject to stringent, ongoing government regulation
15. 27Our employees, independent contractors, principal investigators, consultants, vendors, CROs, CDMOs and any partners with which we may collaborate may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements
16. 28We may be required to modify our business practices, pay fines and significant expenses or experience other losses due to governmental investigations or other enforcement activities
17. 29We or our current and prospective partners may be subject to product recalls in the future that could harm our brand and reputation and could negatively affect our business
18. 30We will need to obtain FDA approval of any proposed names for our product candidates that gain marketing approval, and any failure or delay associated with such naming approval may adversely impact our business
19. 31Government initiatives such as the Make America Healthy Again Commission could affect the development and approval of our product candidates
20. 32Our future growth depends, in part, on our ability to penetrate foreign markets, where we would be subject to additional regulatory burdens and other risks and uncertainties
21. 33A pandemic, epidemic, or outbreak of an infectious disease could cause a disruption to the development of our product candidates

Risks Related to Commercialization

1. 34Our ability to generate product revenue will depend significantly on our ability to successfully obtain final marketing approval for and commercialize our product candidates28% rewritten
2. 35If our drug candidates are approved but fail to achieve an adequate level of acceptance by key market participants, we will not be able to generate significant revenues, and we may not become or remain profitable, which may require us to seek additional financing
3. 36Recently enacted and future policies and legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and may affect the reimbursement made for any product candidate for which we receive marketing approval
4. 37Unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives could harm our business in the future
5. 38We may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success
6. 39We may face significant competition from other pharmaceutical companies, and our operating results will suffer if we fail to compete effectively
7. 40Social issues around the abuse of opioids and stimulants, including law enforcement concerns over diversion and regulatory efforts to combat abuse, could decrease the potential market for our product candidates

Risks Related to Our Dependence on Third Parties

1. 41Our product candidates and any drugs that we may develop may compete with other product candidates and drugs for access to manufacturing facilities, and we may be unable to obtain access to these facilities on favorable terms
2. 42We expect to rely on third parties to conduct our clinical trials and our regulatory submissions for our product candidates, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials and/or regulatory submissions
3. 43We depend on collaborations with third parties for the development and commercialization of our product candidates. If those collaborations are not successful, we may not be able to capitalize on the market potential of these product candidates29% rewritten
4. 44If we are not able to maintain or establish partnerships or collaborations, we may have to alter our development and commercialization plans32% rewritten
5. 45If we are unable to achieve and maintain adequate levels of coverage and reimbursement for our product candidates, if approved, their commercial success may be severely hindered
6. 46Third-party payors may not adequately cover or reimburse consumers for the purchase of our products
7. 47If we are unable to support demand for our product candidates, including ensuring that we have adequate capacity to meet increased demand, or we are unable to successfully manage the evolution of our drug delivery technology platform, our business could suffer
8. 48Our relationships with customers and third-party payors are 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
9. 49Product liability lawsuits could divert our resources, result in substantial liabilities and reduce the commercial potential of our product candidates
10. 50Our product liability insurance coverage may not be adequate to cover any and all liabilities that we may incur
11. 51If 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 have a material adverse effect on the success of our business

Risks Related to Managing Our Growth, Our Employees, and Our Operations

1. 52We will need to further increase the size and complexity of our organization in the future, and we may experience difficulties in executing our growth strategy and managing any growth
2. 53If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and/or sell our product candidates, we may be unable to generate any revenue57% rewritten
3. 54We also may enter into additional strategic partnerships with third parties to commercialize our product candidates
4. 55If we fail to attract and retain management and other key personnel, we may be unable to continue to successfully develop or commercialize our product candidates or otherwise implement our business plan
5. 56Our research and development is focused on discovering and developing product candidates but these product candidates may not make it to the market
6. 57Further, any product candidate that we acquire may require additional development efforts prior to commercial sale, including extensive clinical testing and approval by the FDA and other regulatory authorities
7. 58Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations
8. 59Our operating results and liquidity needs could be negatively affected by market fluctuations and economic downturn
9. 60Our business and operations would suffer in the event of failures in our internal computer systems
10. 61We are increasingly dependent on information technology, and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks51% rewritten

Risks Related to Our Intellectual Property

1. 62If our intellectual property related to our products or product candidates is not adequate, we may not be able to compete effectively in our market
2. 63Furthermore, if we encounter delays in our clinical trials or entry onto the market in a particular jurisdiction, the period of time during which we could market a particular product under patent protection would be reduced
3. 64We may not seek to protect our intellectual property rights in all jurisdictions throughout the world, and we may not be able to adequately enforce our intellectual property rights even in the jurisdictions where we seek protection
4. 65Obtaining 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 non-compliance with these requirements
5. 66If we are sued for infringing intellectual property rights of third parties, it will be costly and time consuming, and an unfavorable outcome in that litigation would have a material adverse effect on our business
6. 67We may be unable to adequately prevent disclosure of trade secrets and other proprietary information
7. 68We may be subject to claims by third parties asserting that our employees or we have misappropriated their intellectual property or claiming ownership of what we regard as our own intellectual property
8. 69Our decision to seek approval of CTx-1301 and our other product candidates under 505(b)(2) may increase the risk that patent infringement suits are filed against us, which would delay the FDA’s approval of such product candidates20% rewritten

Risks Related to the Securities Markets and Ownership of Our Securities

1. 70Our failure to maintain compliance with Nasdaq’s continued listing requirements could result in the delisting of our securities from Nasdaq, and the price of our common stock and/or warrants and our ability to access the capital markets could be negatively impactedNew
2. 71Our common stock and warrants are currently listed for trading on The Nasdaq Capital Market. We must satisfy the continued listing requirements of Nasdaq to maintain the listing of our securities on The Nasdaq Capital Market20% rewritten
3. 72An active trading market for our common stock or warrants may not be sustained
4. 73The prices of our securities may be volatile, which could subject us to securities class action litigation and our stockholders could incur substantial losses
5. 74We are an “emerging growth company,” and will be able take advantage of reduced disclosure requirements applicable to “emerging growth companies,” which could make our securities less attractive to investors
6. 75If we are not able to maintain an effective system of internal control over financial reporting, the reliability of our financial reporting, investor confidence in us and the value of our common stock could be adversely affected
7. 76We will incur significantly increased costs as a result of and devote substantial management time to operating as a public company
8. 77If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline
9. 78Future sales of our common stock, warrants, or securities convertible into our common stock may depress our stock price
10. 79Anti-takeover provisions contained in our certificate of incorporation and bylaws, as well as provisions of Delaware law, could impair a takeover attempt
11. 80These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management
12. 81We do not anticipate paying any cash dividends on our common stock in the foreseeable future
13. 82The exclusive forum provision is limited to the extent permitted by law, and it will not apply to claims arising under the Exchange Act or for any other federal securities laws which provide for exclusive federal jurisdiction