LeonaBio (LONA) risk factors, FY2025 10-K

Risks Related to Our Business and the Development of Our Drug Candidates

1. 01We are a clinical-stage biopharmaceutical company with a limited operating history77% rewritten
2. 02Our development of lasofoxifene or ATH-1105 may never lead to marketable productsNew
3. 03establishing the sales and marketing capabilities upon obtaining any marketing approvals to gain market acceptance38% rewritten
4. 04Our ability to generate revenue and achieve profitability depends significantly on our ability to achieve a number of objectives
5. 05attracting, hiring and retaining qualified personnel
6. 06Treatment of central and peripheral nervous system degenerative disorders is a field that has seen very limited success in product development and our research and development efforts may be unsuccessful32% rewritten
7. 07We have no marketed proprietary products and have not yet completed any Phase 3 clinical trials, which makes it difficult to assess our ability to develop our future product candidates and commercialize any resulting products independentlyNew
8. 08If we are unsuccessful in accomplishing these objectives, we will not be able to develop and commercialize any future product candidates independently and could fail to realize the potential advantages of doing soNew
9. 09We currently have two clinical-stage drug candidates, each for the treatment of different indications. It is impossible to predict when or if any of our drug candidates will prove to be effective and safe in humans or will receive regulatory approval64% rewritten
10. 10biopharmaceutical industry have suffered significant setbacks in advanced clinical trials due to lack of efficacy or unacceptable safety issues, notwithstanding promising results in earlier trials. Most product candidates that commence nonclinical studies and clinical trials are never approved as productsNew
11. 11obtaining sufficient supply of drug candidates for use in nonclinical studies or clinical trials from third-party suppliers
12. 12We may not be successful in integrating lasofoxifene into our pipeline of product candidatesNew
13. 13We may expend our limited resources to pursue a particular drug candidate or indication and fail to capitalize on drug candidates or indications that may be more profitable or for which there is a greater likelihood of success56% rewritten
14. 14Our long-term prospects depend in part upon discovering, developing and commercializing additional drug candidates, which may fail in development or suffer delays that adversely affect their commercial viability
15. 15adverse events in the clinical trials87% rewritten
16. 16Any “topline”, interim, initial, or preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data
17. 17Our reporting of topline or final data for our clinical trials may be delayed and our regulatory submissions or receipt of necessary marketing approvals could be delayed or prevented
18. 18We face significant competition, and if our competitors develop and market technologies or products more rapidly than we do or that are more effective, safer, or less expensive than the drug candidates we develop, our commercial opportunities will be negatively impacted
19. 19We may develop drug candidates in combination with other therapies, which exposes us to additional risks
20. 20We may not realize all the anticipated benefits of our corporate rebranding and it may result in unanticipated disruptions to our on-going businessNew
21. 21Loss of goodwill and brand equity associated with our legacy brand that will become less prominent over timeNew

Risks Related to Our Financial Position and Capital Needs

1. 22the economic and other terms, timing of and success of any collaboration, licensing or other arrangements into which we may enter in the future100% rewritten
2. 23Because the time and efforts required for successful research and development of our product candidates is highly uncertain, we are unable to estimate the actual funds we will require for development and any marketing and commercialization activities for any product candidates that ultimately may be approved for saleNew
3. 24As a result of our failure to timely file a Current Report on Form 8-K, we are currently ineligible to file registration statements on Form S-3, which may impair our ability to raise capital on terms favorable to us, in a timely manner or at allNew
4. 25We may become obligated to pay liquidated damages if we fail to obtain effectiveness and maintain effectiveness of registration statements in accordance with the terms of registration rights agreements related to our December 2025 private placement and Sermonix Securities issuanceNew
5. 26We have incurred significant losses since our inception and anticipate that we will continue to incur significant losses for the foreseeable future22% rewritten
6. 27incur expenses in connection with potential future legal proceedings, and addressing potential stockholder activism
7. 28Adverse events or perceptions affecting the financial services industry could adversely affect our operating results, liquidity, financial condition and prospects
8. 29termination of cash management arrangements or delays in accessing or actual loss of funds subject to cash management arrangements54% rewritten
9. 30The value of our investments is subject to significant capital markets risk related to changes in interest rates and credit spreads as well as other investment risks, which may adversely affect our operating results, liquidity, financial condition and prospects
10. 31Our ability to use net operating losses to offset future taxable income may be subject to certain limitations38% rewritten
11. 32Changes in tax laws could have a material adverse effect on our business, cash flows, results of operations or financial condition36% rewritten

Risks Related to Regulatory Approval and Other Legal Compliance Matters

1. 33Obtaining and maintaining regulatory approval of our drug candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our drug candidates in other jurisdictions
2. 34injunctions or the imposition of civil or criminal penalties72% rewritten
3. 35We may face difficulties from changes to current regulations and future legislation. Healthcare legislative measures aimed at reducing healthcare costs may have a material adverse effect on our business and results of operations
4. 36additional record-keeping requirements. If any such changes were to be imposed, they could adversely affect the operation of our business
5. 37Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors, which may adversely affect our future profitability31% rewritten
6. 38part of a grant application, including its certifications and assurances, is found to be false, fictitious, or fraudulentNew
7. 39federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers
8. 40Our employees, independent contractors, consultants, commercial collaborators, principal investigators, CROs, suppliers and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements
9. 41If 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 Our Reliance on Third Parties

1. 42We may use strategic collaborations, licensing arrangements or partnerships to accelerate the development and maximize the commercial potential of our programs, and we may not realize the benefits of such collaborations, arrangements or partnerships
2. 43collaborators may own or co-own intellectual property covering our drug products that results from our collaborating with them, and in such cases, we would not have the exclusive right to commercialize such intellectual property
3. 44If we engage in future acquisitions or strategic partnerships, this may increase our capital requirements, dilute our stockholders, cause us to incur debt or assume contingent liabilities, and subject us to other risks56% rewritten
4. 45our inability to generate revenue from acquired technology or products sufficient to meet our objectives in undertaking the acquisition or even to offset the associated acquisition and maintenance costsNew
5. 46We utilize and depend upon independent investigators and collaborators, such as medical institutions, CROs, commercial manufacturing organizations ("CMOs"), and strategic partners to conduct and support our nonclinical studies and clinical trials under agreements with us
6. 47the misappropriation of our proprietary information, including our trade secrets and know-how27% rewritten
7. 48Our manufacturing process needs to comply with FDA regulations relating to the quality and reliability of such processes. Any failure to comply with relevant regulations could result in delays in or termination of our clinical programs and suspension or withdrawal of any regulatory approvals
8. 49If our third-party manufacturers use hazardous materials in a manner that causes injury or violates applicable law, we may be liable for damages

Risks Related to Our Ability to Commercialize our Drug Products

1. 50Even if approved, our drug candidates may not achieve adequate market acceptance among physicians, patients, healthcare payors and others in the medical community necessary for commercial success
2. 51We have never commercialized a drug candidate before and may lack the necessary expertise, personnel and resources to successfully commercialize any drug products on our own or together with suitable collaborators
3. 52If the market opportunity for any drug candidate that we develop is smaller than we believe, our revenue may be adversely affected and our business may suffer22% rewritten
4. 53If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our drug candidates
5. 54a decline in our share price85% rewritten
6. 55claim, even if successfully defended, could have a material adverse effect on our business, financial condition or results of operationsNew
7. 56neither experimental nor investigational
8. 57A variety of risks associated with marketing our drug candidates internationally may materially adversely affect our business

Risks Related to Our Intellectual Property

1. 58Our success depends on our ability to protect our intellectual property and our proprietary technologies
2. 59countries other than the United States may have patent laws less favorable to patentees than those upheld by U.S. courts, allowing foreign competitors a better opportunity to create, develop and market competing product candidates
3. 60If the scope of any patent protection we obtain is not sufficiently broad or the term is not sufficiently long, or if we lose any of our patent protection, our ability to prevent our competitors from commercializing similar or identical product candidates would be adversely affected50% rewritten
4. 61Intellectual property rights do not necessarily address all potential threats to our competitive advantage
5. 62Our commercial success depends significantly on our ability to operate without infringing the patents and other proprietary rights of third parties. Claims by third parties that we infringe their proprietary rights may result in liability for damages or prevent or delay our developmental and commercialization efforts
6. 63require us to enter into royalty or licensing agreements, which may not be available on commercially reasonable terms, or at all, or which might be non-exclusive, which could result in our competitors gaining access to the same technology
7. 64We may not be successful in obtaining or maintaining necessary rights to our drug candidates through acquisitions and in-licenses
8. 65We may be involved in lawsuits to protect or enforce our patents or any current or future licensors’ patents, which could be expensive, time consuming and unsuccessful. Further, our issued patents or any current or future licensors’ patents could be found invalid or unenforceable if challenged in court
9. 66Intellectual property litigation or legal proceedings may lead to unfavorable publicity that harms our reputation and causes the market price of our common stock to decline
10. 67Derivation proceedings may be necessary to determine priority of inventions, and an unfavorable outcome may require us to cease using the related technology or to attempt to license rights from the prevailing party
11. 68Patent reform legislation could increase the uncertainties and costs surrounding the prosecution of our patent applications or those of any current or future licensors and the enforcement or defense of our issued patents or those of any current or future licensors
12. 69Changes in U.S. patent law, or laws in other countries, could diminish the value of patents in general, thereby impairing our ability to protect our drug candidates
13. 70We may be subject to claims challenging the inventorship or ownership of our patents and other intellectual property
14. 71Patent terms may be inadequate to protect our competitive position on our drug candidates for an adequate amount of time
15. 72If we do not obtain patent term extension for our drug candidates, our business may be materially harmed
16. 73We will not be able to protect our intellectual property rights throughout the world
17. 74Obtaining and maintaining our patent protection depends on compliance with various procedural, documentary, fee payment, and other requirements imposed by regulations and governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements
18. 75If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected
19. 76If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed59% rewritten
20. 77We may be subject to claims that we or our employees have wrongfully used or disclosed alleged confidential information or trade secrets of third parties
21. 78We may be subject to claims that we have wrongfully hired an employee from a competitor or that we or our employees have wrongfully used or disclosed alleged confidential information or trade secrets of their former employers
22. 79Our rights to develop and commercialize our drug candidates may be subject, in part, to the terms and conditions of licenses granted to us by others
23. 80If we fail to comply with our obligations in the agreements under which we license intellectual property rights or other rights from third parties or otherwise experience disruptions to our business relationships with our licensors, we could lose license rights that are important to our business
24. 81the priority of invention of patented technology
25. 82The patent protection and patent prosecution for some of our drug candidates may be dependent on third parties

Risks Related to Cybersecurity

1. 83addition, our liability insurance may not be sufficient in type or amount to cover us against claims related to security breaches, cyberattacks and other privacy and security breaches or incidentsNew
2. 84Data collection is governed by restrictive regulations governing the use, processing and cross-border transfer of personal information

Risks Related to Ownership of Our Common Stock

1. 85We do not know whether an active market for our common stock will be sustained, and, as a result, it may be difficult for you to sell your shares of our common stock
2. 86The market price of our common stock has been and may continue to be volatile, which could result in substantial losses for investors22% rewritten
3. 87the other factors described in this “Risk Factors” section
4. 88Future sales, or the perception of future sales, of a substantial amount of our common stock could depress the trading price of our common stockNew
5. 89Our executive officers and directors may enter into Rule 10b5-1 trading plans in the future. Under a Rule 10b5-1 trading plan, a broker executes trades pursuant to parameters established by the employee, director, or officer when entering into the plan, without further direction from the employee, officer, or directorNew
6. 90Our reverse stock split to regain compliance with the Nasdaq Capital Market Minimum Bid Requirement may not result in a lasting proportional increase in the per share price of our common stock and may decrease the liquidity of our common stockNew
7. 91We and certain of our directors and executive officers have previously been, and may in the future be, named as defendants in lawsuits that could result in substantial costs and divert management’s attention71% rewritten
8. 92Actions by activist stockholders have in the past been, and may in the future be, disruptive and could cause uncertainty about the strategic direction of our business69% rewritten
9. 93A significant portion of our total outstanding shares may be sold into the market in the near future, which could cause the market price of our common stock to decline significantly, even if our business is doing well
10. 94Our directors, executive officers and significant stockholders collectively own a substantial percentage of our common stock, which could limit your ability to affect the outcome of key transactions, including a change of control
11. 95We 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 investors71% rewritten
12. 96Failure to build and maintain our finance infrastructure and improve our accounting systems and controls could impair our ability to comply with the financial reporting and internal controls requirements for publicly traded companies
13. 97Anti-takeover provisions in our charter documents and under Delaware or Washington law could make an acquisition of us difficult, limit attempts by our stockholders to replace or remove our current management and limit our stock price
14. 98provide that stockholders are permitted to amend the bylaws only upon receiving at least two-thirds of the total votes entitled to be cast by holders of all outstanding shares then entitled to vote generally in the election of directors, voting together as a single class
15. 99The loss of any of our key personnel could significantly harm our business, results of operations and competitive position
16. 100Our advisors and consultants are classified as independent contractors, and we can face consequences if it is determined that they are misclassified as such
17. 101If securities analysts do not publish research or reports about our business or if they publish negative evaluations of our stock, the price of our stock could decline
18. 102We will continue to incur increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives and corporate governance practices
19. 103As a public company, we are subject to reporting and other obligations under the Exchange Act, including the requirements of Section 404 of the Sarbanes-Oxley Act, which require annual management assessments of the effectiveness of our internal control over financial reporting
20. 104The potential effects of health epidemics could adversely impact our business, including our nonclinical studies and clinical trials
21. 105changes in clinical site procedures and requirements as well as regulatory requirements for conducting clinical trials during the pandemic