KORU Medical Systems (KRMD) risk factors, FY2024 10-K

Risks Related to Our Business

1. 01If we are unable to successfully introduce new products or fail to keep pace with advances in technology, our business, financial condition and results of operations could be adversely affected
2. 02Our business depends on an adequate supply of drugs to be administered by our products
3. 03Our compliance with EU MDR regulations by December 2028 will require significant investment and, if we are not in compliance by that time, we will not be able to sell our products in the EU
4. 04Interruption of our manufacturing or our contract manufacturing operations could adversely affect our business
5. 05Public health crises, such as the COVID-19 pandemic, have had, and could in the future have, a negative effect on our business
6. 06If we are unable to compete successfully in our highly competitive industry, our business and financial condition may be adversely affected
7. 07Competition may increase further as additional companies begin to enter our market or modify their existing products to compete directly with ours. If we are forced to reduce our prices due to increased competition, our business could suffer
8. 08Technological developments by others may disrupt our business and negatively impact our revenues
9. 09We are subject to costly and complex laws and governmental regulations and any adverse regulatory action may materially adversely affect our financial condition and business operations
10. 10Healthcare policy changes and industry cost-containment measures could result in downward pricing pressure for our products and limit our sales
11. 11Issues with product quality could have an adverse effect upon our business, subject us to regulatory actions, cause a loss of customer confidence in us or our products, among other negative consequences
12. 12Defects or quality issues associated with our products could adversely affect the results of our operations
13. 13We are subject to lawsuits
14. 14If we are unable to protect our patents or other proprietary rights, or if we infringe the patents or other proprietary rights of others, our competitiveness and business prospects may be materially damaged
15. 15We need to attract and retain key employees to be competitive
16. 16We sell a majority of our products through only a few distributors on whom we depend, and our financial results depend on their purchasing patterns
17. 17We and the biopharmaceutical companies with whom we do novel therapies business (“our biopharma customers”) are subject to extensive regulation by governments around the world, and if these regulations are not complied with, existing and future operations may be curtailed, and we could be subject to liability
18. 18If our devices are commercialized as part of a drug-delivery combination product we, as the manufacturer of the device component of that combination product, we are subject to unannounced and preapproval inspections by the FDA of our manufacturing facility to determine our compliance with QSR and cGMP
19. 19The therapeutic efficacy of certain of our biopharma customers’ products that may utilize our device are either unproven in humans or has only been proven in limited circumstances, and we may not be able to successfully develop and sell our products in combination with our biopharma customers’ products
20. 20Our commercial success depends upon the attainment of significant market acceptance of drug product candidates to be included in our biopharma customers’ products that may utilize our device, if approved, among physicians, patients, healthcare payers or the medical community
21. 21Most brand name injectable therapies will face future competition from generic or biosimilar therapies, which could significantly reduce their commercial viability
22. 22Our failure to comply with laws and regulations relating to reimbursement of healthcare products may subject us to penalties and adversely impact our reputation, business, results of operations, financial condition and cash flows
23. 23Producing and marketing our developed products is costly. Although we believe we currently have adequate capital to fulfill our near-term funding needs, we may need to raise additional capital in the future in order to execute our business plan and help us fund the development and commercialization of new products
24. 24We are required to comply with certain financial and operating covenants under our credit facility. Failure to comply with these covenants would prevent us from drawing on our facility and, once drawn, could cause amounts borrowed to become immediately due and payable
25. 25We may experience difficulties resulting from our relatively new and evolving management structure and executive team
26. 26Changes in tax or labor laws or exposure to additional income tax liabilities could increase our costs and reduce our margins
27. 27A downturn in global economic conditions could adversely affect our operations
28. 28We are subject to foreign currency exchange risk
29. 29Our distribution network and other operations outside the U.S. subject us to certain risks
30. 30We are dependent on information technology systems and subject to privacy and security laws, and our systems and infrastructure face certain risks, including from cyber security breaches and data leakage
31. 31We cannot guarantee that any of our strategic acquisitions, investments or alliances will be successful
32. 32Our operating results and financial condition may fluctuate
33. 33Future material impairments in the value of our long-lived assets could negatively affect our operating results
34. 34Actions of activist stockholders could have an adverse effect on our business
35. 35Natural disasters, war and other events could adversely affect our suppliers and customers
36. 36Our insurance coverage may be inadequate to cover all the liabilities we may incur
37. 37Rising inflation increases economic uncertainty and may require us to raise prices in order to maintain our operating margins
38. 38Brexit may impact our business in the United Kingdom
39. 39We could be adversely affected, directly or indirectly, by the effects of an increased focus on environmental, social and governance issues

Risks Related to Ownership of Our Common Stock

1. 40There may be circumstances in which the interests of our significant stockholders could be in conflict with your interests as a stockholder
2. 41We do not currently intend to pay dividends on our common stock
3. 42Future sales and issuances of shares of our common stock or rights to purchase our common stock, including pursuant to our equity compensation plans, could result in additional dilution of the percentage ownership of our stockholders
4. 43There has been volatility in the price of shares of our common stock
5. 44If we do not maintain compliance with the listing standards of the Nasdaq Capital Market, Nasdaq may delist our common stock from trading on its exchange
6. 45We are a smaller reporting company and non-accelerated filer, and we cannot be certain if the reduced disclosure requirements applicable to us will make our common stock less attractive to investors
7. 46The price of our common stock may be adversely affected by the future issuance and sale of shares of our common stock or other equity securities
8. 47You may find it difficult to sell our common stock