Elicio Therapeutics (ELTX) risk factors, FY2024 10-K

Risks Related to Our Operating History, Financial Position and Capital Requirements

1. 01We will require substantial additional capital to finance our operations, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our research and development programs, commercialization efforts or cease operations
2. 02Our recurring losses from operations have raised substantial doubt regarding our ability to continue as a going concern
3. 03We may be unsuccessful in raising the capital necessary to address our going concern issues, or if we are successful, it may be on terms that are highly dilutive to existing stockholders
4. 04We have a history of operating losses that are expected to continue for the foreseeable future, and we are unable to predict the extent of future losses, or whether we will generate significant revenues or achieve or sustain profitability
5. 05We have never generated revenue from product sales and may never become profitable
6. 06current and future product candidates. We do not anticipate generating product sales for the next several years, if ever
7. 07We have a limited operating history and we expect a number of factors to cause our operating results to fluctuate on a quarterly and annual basis, which may make it difficult to predict our future performance
8. 08Accordingly, the results of any quarterly or annual periods should not be relied upon as indications of future operating performance
9. 09Failure to maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our stock price
10. 10We hold a portion of our cash and cash equivalents that we use to meet our working capital and operating expense needs in deposit accounts that could be adversely affected if the financial institutions holding such funds fail
11. 11Changes in interpretation or application of U.S. GAAP may adversely affect our operating results

Risks Related to the Development of our Product Candidates

1. 12Our product candidates are at an early stage of development and may not be successfully developed or commercialized
2. 13action than we initially understand or than we expect in humans, and may not ultimately prove to be safe or effective
3. 14Furthermore, we expect to rely on CROs and clinical trial sites to ensure the proper and timely conduct of our clinical trials and data analysis from such trials. Although we expect to enter into agreements governing our CROs’ committed activities, we have limited influence over their actual performance
4. 15Preliminary results from our nonclinical studies and clinical trials that we announce or publish from time to time may change as more patient data becomes available and as the data undergoes audit and verification procedures
5. 16The FDA or comparable foreign regulatory authorities may disagree with our regulatory plans and we may fail to obtain regulatory approval of our product candidates
6. 17We may not be successful in our efforts to use and expand our discovery engine to build a pipeline of product candidates
7. 18If any of these events were to occur, our business and growth prospects would be harmed, possibly materially
8. 19We may seek an accelerated approval development pathway for our product candidates. See “Description of Our Business—Government Regulation and Product Approval—Accelerated Approval” for a description of the accelerated approval pathway
9. 20If we apply for orphan drug designation from the FDA, there is no guarantee that we will be able to obtain or maintain this designation, receive this designation for any of our other product candidates, or receive or maintain any corresponding benefits, including periods of exclusivity
10. 21We 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
11. 22Any future product candidates for which we intend to seek approval as biological products may face competition sooner than anticipated
12. 23If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected
13. 24Any product candidate we advance into clinical trials may cause unacceptable adverse events or have other properties that may delay or prevent our regulatory approval or commercialization or limit our commercial potential
14. 25We may form or seek strategic partnerships or enter into additional licensing arrangements in the future, and we may not realize the benefits of such alliances or licensing arrangements
15. 26We rely on CMOs to manufacture our nonclinical and clinical pharmaceutical supplies and expect to continue to rely on CMOs to produce commercial supplies of any approved product candidate, and our dependence on CMOs could adversely impact our business
16. 27result in delays to nonclinical studies and clinical trials, or potential product approvals or commercialization. Any such delay may also require that we conduct additional studies
17. 28We rely on other third parties to store and distribute our product candidates for nonclinical studies and clinical trials that we conduct
18. 29We may incur substantial product liability or indemnification claims relating to the clinical testing of our product candidates

Risks Related to Our Business, Industry and Future Commercialization

1. 30If any product candidate that we successfully develop does not achieve broad market acceptance among physicians, patients, health care payors and the medical community, the revenues that we generate from sales will be limited
2. 31If any product candidate is approved but does not achieve an adequate level of acceptance by physicians, hospitals, health care payors and patients, we may not generate sufficient revenue from these products and may not become or remain profitable
3. 32If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to sell and market any product candidates we may develop, we may not be successful in commercializing those product candidates if and when they are approved
4. 33Corporate and academic collaborators may take actions to delay, prevent, or undermine the success of our products
5. 34Data provided by collaborators and others upon which we rely that has not been independently verified could turn out to be false, misleading, or incomplete
6. 35Even if we are able to commercialize any product candidates, such products may become subject to unfavorable pricing regulations, reimbursement practices, or health care reform initiatives, which would harm our business
7. 36If the market opportunities for any of our product candidates are smaller than we believe they are, our potential revenues may be adversely affected, and our business may suffer
8. 37If we or any CMOs and suppliers we engage 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
9. 38the same levels of quality and efficiency, we may not be able to supply the required number of doses for our current or planned clinical trials or for commercial supply, if any of our product candidates receive regulatory approval, and our business could be harmed
10. 39We also may encounter problems hiring and retaining the experienced scientific, quality control, and manufacturing personnel needed to manage our manufacturing process, which could result in delays in our production or difficulties in maintaining compliance with applicable regulatory requirements
11. 40Our insurance policies are expensive and protect us only from some business risks, which will leave us exposed to significant uninsured liabilities
12. 41Business interruptions could adversely affect future operations, revenues, and financial conditions, and may increase our costs and expenses
13. 42Indemnity provisions in various agreements potentially expose us to substantial liability for intellectual property infringement, data protection, and other losses

Risks Related to Our Intellectual Property

1. 43Our success will depend upon intellectual property and proprietary technologies, and we may be unable to protect our intellectual property
2. 44We may be forced to litigate to enforce or defend our intellectual property rights, and/or the intellectual property rights of our licensors
3. 45We have rights in some intellectual property that have been discovered through United States government funded programs and thus are subject to federal regulations such as “march-in” rights, certain reporting requirements, and a preference for U.S. industry
4. 46If we or our partners are sued for infringing on the intellectual property rights of third parties, it could be costly and time-consuming, and an unfavorable outcome in any such litigation could have a material adverse effect on our business
5. 47Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment, and other requirements imposed by government patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements
6. 48Changes in patent law in the United States and in non-U.S. jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our technologies and product candidates
7. 49Changes in either the patent laws or interpretation of the patent laws could increase the uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of our issued patents
8. 50Patent terms may be inadequate to protect our competitive position on our product candidates for an adequate amount of time
9. 51If we are unable to protect the confidentiality of our trade secrets, our business and competitive position could be harmed
10. 52employees, consultants and third parties to protect our know-how and other confidential and proprietary information, especially where we do not believe patent protection is appropriate or obtainable
11. 53Third parties may assert that our employees, consultants, or advisors have wrongfully used or disclosed confidential information or misappropriated trade secrets
12. 54Any trademarks we may obtain may be infringed or successfully challenged, resulting in harm to our business
13. 55Intellectual property rights do not necessarily address all potential threats

Risks Related to Regulatory and Compliance Matters

1. 56The FDA regulatory approval process is lengthy, time-consuming, and inherently unpredictable, and we may experience significant delays in the clinical development and regulatory approval, if any, of our product candidates
2. 57Even if we receive regulatory approval of our product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and we may be subject to penalties if we fail to comply with regulatory requirements
3. 58other post-marketing information and reports, registration, as well as continued compliance with cGMP and GCP for any clinical trials that we conduct post-approval
4. 59Additional regulatory burdens and other risks and uncertainties in foreign markets may limit our growth
5. 60reimbursement before it can be approved for sale in that jurisdiction. In some cases, the price that we intend to charge for our products is also subject to approval
6. 61Health care and other reform legislation may increase the difficulty and cost for us and any collaborators we may have to obtain marketing approval of and commercialize our product candidates and affect the prices we, or they, may obtain
7. 62Our employees, principal investigators, consultants, and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading
8. 63Laws and regulations governing any international operations we may have in the future may preclude us from developing, manufacturing and selling certain product candidates outside of the United States and require us to develop and implement costly compliance programs

Risks Related to Employee and Operations Matters, Managing Growth and Information Technology

1. 64Our business, operations and clinical development timelines and plans are subject to risks arising from epidemic or pandemic diseases
2. 65Our future success depends on our ability to retain our key executives and to attract, retain, and motivate qualified personnel
3. 66If we are unable to hire additional qualified personnel, our ability to grow our business may be harmed
4. 67We expect to expand our development, regulatory, and future sales and marketing capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations
5. 68Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and stock price
6. 69Inflation could adversely affect our business and results of operations
7. 70We have broad discretion in the use of our financial resources and may not use them effectively
8. 71U.S. federal income tax reform could adversely affect our business and financial condition
9. 72The market price of our common stock is expected to be volatile, and the market price of our common stock may drop
10. 73Moreover, the stock markets in general have experienced substantial volatility that has often been unrelated to the operating performance of individual companies. These broad market fluctuations may also adversely affect the trading price of our common stock
11. 74We will continue to incur costs and demands upon management as a result of complying with the laws, rules and regulations affecting public companies
12. 75We may become involved in securities litigation that could divert management’s attention and harm our business, and insurance coverage may not be sufficient to cover all costs and damages
13. 76Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult and may prevent attempts by our stockholders to replace or remove our management
14. 77We do not anticipate that we will pay any cash dividends in the foreseeable future
15. 78Our stockholders may experience future dilution as a result of future equity offerings
16. 79An active trading market for our common stock may not develop and our stockholders may not be able to resell their shares of common stock for a profit, if at all
17. 80Future sales of a substantial number of shares by existing stockholders, or the perception that such sales could occur, could cause our stock price to decline
18. 81Our largest stockholder has significant influence over us, including influence over decisions that require the approval of stockholders, which could limit our stockholders’ ability to influence the outcome of key transactions, including a change of control
19. 82Although we do not expect to rely on the “controlled company” exemption, we may soon become a “controlled company” within the meaning of the Nasdaq listing standards, and we would qualify for exemptions from certain corporate governance requirements
20. 83If equity research analysts do not publish research or reports, or publish unfavorable research or reports, about us, our business or our market, our stock price and trading volume could decline
21. 84We are expected to take advantage of reduced disclosure and governance requirements applicable to smaller reporting companies and emerging growth companies, which could result in our common stock being less attractive to investors
22. 85Changes in tax laws may materially adversely affect our business, prospects, financial condition and operating results
23. 86Our ability to use NOL carryforwards and other tax attributes may be limited