Grace Therapeutics (GRCE) risk factors, FY2026 10-K

Other

1. 01We received a Complete Response Letter (CRL) from the FDA citing certain manufacturing deficiencies and other non-clinical issues, which may delay or prevent approval of GTx-104New
2. 02We may not achieve our publicly announced milestones on time, or at all24% rewritten
3. 03We are heavily dependent on the success of our lead drug candidate, GTx-10466% rewritten
4. 04We may not be able to maintain our operations and advance our research and development and if approved, commercialization of our GTx-104 lead drug candidate without additional funding56% rewritten
5. 05We have no history of commercializing drugs, which may make it difficult for you to evaluate the success of our business to date and to assess our future viability
6. 06Our future success depends on our ability to retain key executives and to attract, retain and motivate qualified personnel
7. 07We may need to expand our organization, and we may experience difficulties in managing this growth, which could disrupt our operations and our ability to compete
8. 08We face potential product liability, and if claims are brought against us, we may incur substantial liability
9. 09the inability to commercialize our product candidates
10. 10We rely on information technology and any failure, inadequacy, interruption, or security lapse of that technology, including any cybersecurity incidents, could harm our ability to operate our business effectively87% rewritten
11. 11In addition, we depend on third parties, including CROs and CMOs, and other vendors, to conduct significant aspects of our operations. Any cybersecurity incident affecting these third parties could have similar adverse effects on us, and we may have limited ability to monitor or control their cybersecurity measuresNew
12. 12Our ability to conduct our business is dependent on the data that we collect, process, and share in discovering, developing, and commercializing drug products. These data are often considered personal data and are therefore regulated by data privacy laws in the United States and abroad28% rewritten
13. 13We face risks related to the growth of artificial intelligence and data analyticsNew
14. 14We may not be able to maximize value from our de-prioritized drug candidates, GTx-102 and GTx-101, through either out-licensing or sale

Risks Related to Development, Testing and Commercialization of Our Products

1. 15Clinical development is a lengthy and expensive process with an uncertain outcome, and results of earlier studies and trials may not be predictive of future trial results. Failure can occur at any stage of clinical development
2. 16delays by our CMOs to produce and deliver sufficient supply of clinical trial materials
3. 17The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our drug candidates, our business will be substantially harmed
4. 18the approval policies or regulations of the FDA or comparable foreign regulatory authorities may change significantly in a manner rendering our clinical data insufficient for approval22% rewritten
5. 19If a product candidate causes undesirable side effects, then we may be unable to receive regulatory approval or market acceptance for such product candidate
6. 20If the market opportunities for GTx-104 are smaller than we believe they are, our results of operations may be adversely affected, and our business may suffer
7. 21We are subject to uncertainty relating to healthcare reform measures and reimbursement policies which, if not favorable to our drug candidates, could hinder or prevent our drug candidates ’ commercial success
8. 22Recent and future changes in healthcare legislation and regulations may increase the difficulty and cost to obtain marketing approval for a drug candidate, increase the costs to commercialize an approved product, and adversely affect the price set for such product83% rewritten
9. 23The One Big Beautiful Bill Act, signed into law on July 4, 2025, is projected to decrease federal health care spending by approximately $1 trillion by reducing Medicaid spending and enrollment and making changes to federal Medicare spendingNew
10. 24Our commercial success depends upon attaining significant market acceptance of our drug candidates and drug products, if approved, among physicians, nurses, pharmacists, patients, the medical community and third-party payors
11. 25the effectiveness of our sales and marketing efforts
12. 26If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell our drug candidates, we may be unable to generate any revenue
13. 27Even if GTx-104 receives regulatory approval, we will still face regulatory difficulties
14. 28The occurrence of any event or penalty described above may inhibit or preclude our ability to commercialize GTx-104 and generate revenue
15. 29Even if our drug candidates receive regulatory approval in the United States, we may never obtain regulatory approval or successfully commercialize our products outside of the United States
16. 30If we obtain approval to commercialize any approved drug products outside of the United States, a variety of risks associated with international operations could materially adversely affect our business
17. 31We are required to obtain regulatory approval for each of our drug candidates in each jurisdiction in which we intend to market such products, and the inability to obtain such approvals would limit our ability to realize their full market potential
18. 32We face significant competition from other biotechnology and pharmaceutical companies, and our operating results will suffer if we fail to compete effectively
19. 33We could incur substantial costs and disruption to our business and delays in the launch of our drug candidates if our competitors and/or collaborators bring legal actions against us, which could harm our business and operating results
20. 34We are subject to numerous complex regulatory requirements and failure to comply with these regulations, or the cost of compliance with these regulations, may harm our business, or subject us to civil or criminal proceedings, investigations, or penalties and may limit our ability to commercialize our products
21. 35Our employees, independent contractors, principal investigators, consultants, commercial partners and vendors may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements

Risks Relating to Our Intellectual Property

1. 36If 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
2. 37redesigning our drug candidates or processes so they do not infringe, which may not be possible or may require substantial funds and time
3. 38We may be subject to claims that our employees, consultants, or independent contractors have wrongfully used or disclosed alleged confidential information or trade secrets of their other clients or former employers to us
4. 39Our success depends in part upon our ability to protect our intellectual property for our branded products and drug candidates
5. 40we may not develop additional proprietary technologies that are patentable
6. 41If we fail to comply with our obligations in the agreements under which we license rights to technology from third parties, or if the license agreements are terminated for other reasons, we could lose license rights that are important to our business
7. 42We may be subject to claims challenging the inventorship or ownership of our patents and other intellectual property
8. 43Intellectual property rights do not necessarily address all potential threats to our competitive advantage
9. 44We may not be able to protect our intellectual property rights throughout the world
10. 45If our estimates or judgments relating to our critical accounting policies for intangible assets prove to be incorrect, further impairment charges could result39% rewritten

Risks Related to Our Dependence on Third Parties

1. 46If our current CMO is unable to timely resolve the deficiencies identified by the FDA in the CRL related to GTx‑104, we may be required to engage an alternative manufacturer, which could result in significant delays, increased costs, or our inability to obtain regulatory approval or commercialize GTx‑104 at allNew

Risks Related to Tax

1. 47We may not be able to use our net operating loss carry forwards to offset future taxable income for U.S. and Canadian federal income tax purposes32% rewritten
2. 48The IRS may not agree that we should be treated as a foreign corporation for U.S. federal tax purposes prior to the Domestication

Risks Relating to Our Common Stock

1. 49We do not expect to pay any cash dividends for the foreseeable future
2. 50The price of our common stock may be volatile
3. 51Raising additional capital may cause dilution to our existing stockholders, restrict our operations, or require us to relinquish rights to our technologies or drug candidates61% rewritten
4. 52We may pursue opportunities or transactions that adversely affect our business and financial condition and the public announcement of any of these or similar strategic opportunities or transactions might have a significant effect on the price of our common stockNew