Dare Bioscience (DARE) risk factors, FY2024 10-K

Other

1. 01Failure of these third parties to perform as expected could result in substantial delays, increased costs or failures of our product development programs, delayed or unsuccessful commercialization of any approved products, and the need for significant additional capital

Risks Related to Our Financial Position and Capital Needs

1. 02We will need to raise substantial additional capital to continue our operations and execute our business strategy, and we may not be able to raise adequate capital on a timely basis, on favorable terms, or at all
2. 03Raising additional capital may cause substantial dilution to our stockholders, restrict our operations or require us to relinquish rights in our technologies or product candidates and their future revenue streams
3. 04Agreements. Moreover, the lower our cash balance when we seek to raise additional capital, the more difficult, costly or dilutive to our existing stockholders it may be for us to raise additional capital
4. 05We have a limited operating history, a history of significant losses from operations, and expect significant losses from operations, net losses and negative cash flows from operations to continue for the foreseeable future, which, together with our limited financial resources, make it difficult to assess our prospects
5. 06The Revenue Sharing Threshold may never be achieved and, as a result, we may not realize any future income based on sales of XACIATO
6. 07To the extent we enter into licensing agreements for third-party commercialization of products we develop, as is the case with XACIATO and Ovaprene, we expect our revenue streams related to those products will be based primarily on net sales, which will be largely outside of our control
7. 08exclusive license agreements with Organon and Bayer, assuming the license grant to Bayer becomes effective, our royalty interest financing agreement, and the Royalty Purchase Agreements, XACIATO’s and Ovaprene’s value to us will be based primarily on net sales, as determined under those agreements
8. 09If one of our commercial collaborators terminates its exclusive license agreement with us, our need for additional capital may significantly increase
9. 10Uncertainty in U.S. federal government funding and contracting policies may adversely affect our business
10. 11Our cash could be adversely impacted if a financial institution with which we have deposit or other accounts fails

Risks Related to Product Research & Development and Regulatory Approval

1. 12Clinical development is a lengthy and expensive process with an inherently uncertain outcome. Failure to successfully develop and obtain regulatory approval to market and sell our product candidates, and in particular, Ovaprene and Sildenafil Cream, would likely adversely affect our business
2. 13Delays in the commencement or completion of clinical testing of our product candidates may occur due to any of a number of factors and could result in significantly increased costs and longer timelines and could impact our ability to ever become profitable
3. 14development and commercialization efforts would be impaired, which could have a material adverse effect on our business, financial condition and results of operations
4. 15complexities of the condition it is intended to treat, which may significantly lengthen clinical study timelines, increase overall costs, and may lead to unfavorable results
5. 16A change in the regulatory approval pathway we anticipate for a product candidate could significantly increase development cost and timeline and heighten the risk of failure
6. 17Some of our product candidates may be considered combination products by the FDA and other regulatory authorities, which could increase the complexity, cost and timeline for their development and regulatory approval
7. 18Our clinical-stage product candidates have only been tested in a small number of women over short periods of use and no data exists regarding a potential increase in fetal abnormalities in pregnant women
8. 19Pre-clinical product candidates may be undervalued by investors and may be difficult to fund
9. 20Several of our product candidates are in pre-clinical stages of development and may never advance to clinical development

Risks Related to Commercialization of Products We Develop

1. 21Our product candidates, if approved for commercial sale, will face intense competition and our business and operating results will suffer if we, or our commercial collaborators, fail to compete effectively
2. 22cost-effective basis, than our product candidates. The success of competitive products may render our product candidates noncompetitive or obsolete, even prior to completion of their development
3. 23The women's health market includes many generic FDA-approved drug products, compounded drugs, as well as dietary supplements and consumer health products, and growth in these categories is expected to continue, which could make the successful introduction of our products difficult and expensive
4. 24Our product candidates may fail to achieve the degree of market acceptance by physicians, patients, third-party payors or others in the medical community necessary for commercial success, which would negatively impact our business
5. 25The commercial success of XACIATO is outside of our control and will depend on Organon’s efforts and capabilities, as well as a variety of factors, many of which currently are unknown or uncertain, and if commercialization of XACIATO is not successful, our business and prospects may suffer
6. 26If one or more of these risks occur, it could reduce the market potential for Ovaprene, or any other contraceptive product we develop, and place pressure on our business, financial condition, results of operations and prospects
7. 27The commercial success of DARE-HRT1, if approved for commercial sale, will depend on the availability of alternative products for managing menopause symptoms, concerns about the safety of hormone therapy, and women's preferences, among other factors

Risks related to market acceptance of DARE-HRT1 include

1. 28Depending upon the direction of the factors above, a commercial market for DARE-HRT1 may develop more slowly than expected, or not at all, and our business, financial condition, results of operation and prospects could be hurt as a result
2. 29Unexpected safety, efficacy or quality concerns relating to XACIATO could develop, which could have significant negative consequences for us
3. 30If we suffer negative publicity concerning the safety or efficacy of XACIATO or the product candidates we develop, our reputation could be harmed, product sales could be adversely affected or we may be forced to cease or curtail product development efforts
4. 31We are and will remain subject to ongoing regulatory requirements even after obtaining regulatory approval for a product candidate
5. 32Failure to successfully obtain coverage and reimbursement for XACIATO and any future products in the United States, or the availability of coverage only at limited levels, would diminish our ability, or that of a commercial collaborator, to generate net product revenue or net sales
6. 33Legislation and legislative and regulatory proposals intended to contain health care costs may adversely affect our business
7. 34Even seemingly small copayments or other cost-sharing requirements could dramatically reduce the market potential for XACIATO and our product candidates
8. 35As no FDA-approved treatments for FSAD currently exist, there is little precedent to help assess whether health insurance plans will cover Sildenafil Cream, if approved for commercial sale
9. 36The commercial success of products we develop, if approved for commercial sale, will be impacted by the prescribing information approved by the FDA and comparable regulatory authorities outside the U.S
10. 37Manufacturing disruptions could cause significant delays and disruption in the commercial launch and/or supply shortages of any product we develop
11. 38If competitors obtain approval for generic versions of our products, our business may suffer
12. 39We will need to obtain FDA approval of any proposed prescription medical product name, and any failure or delay associated with such approval may adversely affect our business
13. 40Even if we receive marketing approval from the FDA, we may fail to receive similar approvals outside the U.S., which could substantially limit the value of our products

Risks Related to Section 503B Compounding

1. 41We plan to generate revenue from sales of our proprietary Sildenafil Cream formulation produced by Section 503B-registered outsourcing facilities, but we have no experience in this line of business and may not be successful in our efforts
2. 42We will be reliant on Section 503B-registered outsourcing facilities to produce our proprietary Sildenafil Cream formulation, and their failure to adequately perform their obligations could harm our reputation, business and financial condition
3. 43Our plan to bring our proprietary Sildenafil Cream formulation to market under Section 503B will subject us to a variety of new regulations and related potential liability
4. 44Achieving and maintaining market acceptance of our proprietary Sildenafil Cream formulation produced and distributed under Section 503B could be negatively impacted by perceived risks associated with compounded drugs
5. 45Sildenafil citrate must remain on the list of bulk substances that may be used in compounding under Section 503B, and if it were to be removed, we would be unable to offer our proprietary Sildenafil Cream formulation under Section 503B
6. 46If a compounded drug formulation provided by an outsourcing facility leads to patient injury or death, or results in a product recall, we may be exposed to significant liability and reputational harm

Risks Related to Employee Matters and Managing Our Growth

1. 47We have a relatively small number of employees to manage and operate our business
2. 48If we fail to attract and retain management and other key personnel, we may not successfully complete development of, obtain regulatory approval for or commercialize our product candidates, or otherwise implement our business plan
3. 49We may not be successful in our efforts to identify and acquire or in-license additional product candidates or technologies, which may limit our growth potential

Risks Related to Our Intellectual Property

1. 50In addition, because of funding limitations and our limited cash resources, we may not be able to devote the resources that we might otherwise desire to prepare or pursue patent applications, either at all or in all jurisdictions in which we might desire to obtain patents, or to maintain already-issued patents
2. 51We may become involved in patent litigation or other intellectual property proceedings relating to our future product approvals, which could result in liability for damages or delay or stop our development and commercialization efforts
3. 52potential loss of our ability to manufacture and sell products. If we were unsuccessful in enforcing and protecting our intellectual property rights and protecting our products, it could materially harm our business
4. 53We also rely upon trade secrets to protect our technology, product and product candidates, and trade secrets can be difficult to maintain and enforce
5. 54Confidentiality agreements with employees and others may not adequately prevent disclosure of our know-how, trade secrets and other proprietary information and may not adequately protect our intellectual property, which could limit our ability to compete
6. 55Provisions in our agreements with governmental agencies and non-profit organizations may affect our intellectual property rights and the value of our development programs to our company

Risks Related to Our Business Operations and Industry

1. 56Business interruptions resulting from public health crises, natural disasters or telecommunication and electrical failures may materially and adversely affect our business, operating results and financial condition
2. 57Product liability lawsuits against us could cause us to incur substantial liabilities
3. 58Our current or future employees, clinical investigators, commercial collaborators or service providers may engage in misconduct or other improper activities, including non-compliance with laws and regulatory standards
4. 59The scope and enforcement of these laws is uncertain and subject to rapid change in the current environment of health care reform, especially in light of the lack of applicable precedent and regulations
5. 60Our business may be adversely affected by general conditions in the global economy and financial markets and geopolitical tensions and events
6. 61We expect to continue to incur substantial costs and demands on management time to comply with laws and regulations affecting public companies
7. 62We are a smaller reporting company and a non-accelerated filer and the reduced disclosure requirements available to us may make our common stock less attractive to investors
8. 63Our ability to use net operating loss carryforwards and other tax attributes to offset taxable income may be limited

Risks Related to Ownership of Our Common Stock

1. 64The price of our common stock may rise and fall rapidly, substantial price fluctuations may occur regardless of developments in our business or our operating performance, and you could lose all or part of your investment as a result
2. 65On February 13, 2025, Nasdaq’s Listing Qualifications Department notified us that because we did not regain compliance with the Minimum MVLS Rule by February 10, 2025, our common stock is subject to delisting from Nasdaq unless we timely request a hearing before the Nasdaq Hearing Panel (the “Panel”)
3. 66July 18, 2024, we were not in compliance with the continued listing standard commonly referred to as the minimum bid price rule since July 19, 2023
4. 67The sale of our common stock in ATM offerings or under our equity line arrangement may cause substantial dilution to our existing stockholders, and such sales, or the anticipation of such sales, may cause the price of our common stock to decline
5. 68The exercise of our outstanding warrants and options as well as the issuance of shares pursuant to future equity awards under our stock incentive plan may result in significant dilution to our stockholders
6. 69Substantial future sales of our shares of common stock, or the perception that such sales could occur, may cause the price of our common stock to decline, even if our business is doing well
7. 70sales, or the perception that such sales could occur, may continue for an extended period of time and continued negative pressure on the trading price of our common stock could have a material adverse effect on our ability to raise additional capital through equity or equity-linked financings
8. 71We may issue preferred stock with terms that could dilute the voting power or reduce the value of our common stock
9. 72We 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 as a holder of our shares
10. 73Provisions in our certificate of incorporation, our by-laws or Delaware law might discourage, delay or prevent a change in control of our company or changes in our management and, therefore, depress the trading price of our common stock
11. 74Provisions in our by-laws could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees
12. 75If we fail to attract or maintain securities analysts to publish research on our business or if they publish or convey negative evaluations of our business, the price of our stock could decline