Maxcyte (MXCT) risk factors, FY2024 10-K

Risks Related to Our Business and Growth Strategy

1. 01We are a cell engineering and life sciences company and have incurred significant losses since our inception, and we expect to incur losses for the foreseeable future. We have limited product offerings approved for commercial sale and may never achieve or maintain profitability
2. 02We may be unable to successfully execute on our growth strategy
3. 03Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate, and even if the markets in which we compete are as large as we estimate or achieve their forecasted growth, our business could fail to grow at projected rates, if at all
4. 04We rely on assumptions, estimates and data to calculate certain of our key metrics, and real or perceived inaccuracies in such metrics may harm our reputation and negatively affect our business
5. 05Our future success is dependent upon our ability to increase penetration in our existing markets and expand into adjacent markets
6. 06We may be unable to compete successfully against our existing or future competitors
7. 07Our business currently depends significantly on research and development spending by biopharmaceutical companies, a reduction in which could limit demand for our products and adversely affect our business and operating results
8. 08Our current research and development efforts may not produce significant revenue for several years, if at all
9. 09Our international operations may raise additional risks, which could have an adverse effect on our operating results
10. 10As we continue to expand our business globally, our success will depend, in large part, on our ability to anticipate and effectively manage these and other risks associated with our international operations
11. 11If we fail to offer high-quality customer service, our business and reputation could suffer
12. 12If we cannot maintain and expand current SPL agreements and enter into new agreements that generate marketed licensed products, our business could be adversely affected
13. 13If the quality or delivery of our products does not meet our customers’ expectations and needs relative to their regulatory obligations, our reputation could suffer and ultimately our sales and financial results could be negatively impacted
14. 14The failure of our customers to meet their contractual obligations to us could adversely affect our business
15. 15Our customers have significant discretion in determining when and whether to make announcements, if any, about the status of their clinical developments and timelines for advancing collaborative programs, and the price of our common stock may decline as a result of announcements of unexpected results or developments
16. 16Our customers may not achieve projected development and regulatory milestones and other anticipated key events in the expected timelines or at all, or may discontinue some or all of their programs, which could have an adverse impact on our business and could cause the price of our common stock to decline
17. 17new regulations for cell and gene therapies which could result in extended timelines for our customers, creating uncertainty or delays in achieving milestones. Such delays in these milestones could materially affect our ability to forecast and receive milestone payments outlined in our license agreements
18. 18In recent periods, we have depended on a limited number of customers for our revenue, the loss of any of which could have an adverse impact on our business
19. 19We have pursued and may in the future pursue collaborations or licensing arrangements, joint ventures, strategic alliances, partnerships or other strategic investment or arrangements, which may fail to produce anticipated benefits and adversely affect our operations
20. 20We have engaged in and may engage in future acquisitions that could disrupt our business, cause dilution to our stockholders and harm our financial condition and operating results

Risks Related to the Supply and Manufacturing of Our Products

1. 21Additionally, damage to a manufacturing facility or other property of any of our suppliers or their distribution channels due to fire, flood or other natural disaster or casualty event may have a material adverse effect on our business, financial condition and results of operations
2. 22We have limited experience manufacturing our PAs and may be unable to manufacture our PAs in high-quality commercial quantities successfully and consistently to meet demand, which could limit our growth
3. 23quality controls. We may not successfully complete any required increase to existing manufacturing capacity in a timely manner, or at all
4. 24Our results of operations will be harmed if we are unable to accurately forecast customer demand for our products and manage our inventory

Risks Related to Our Product Sales

1. 25Our future success depends on our ability to develop and successfully introduce new and enhanced products that meet the needs of our customers
2. 26Many of our customers have limited resources and to the extent they limit development to a smaller number of product candidates or discontinue development of product candidates using our platform, our product sales would be negatively impacted
3. 27If we are unable to successfully expand our commercial operations, including hiring additional qualified sales representatives, application scientists, engineers, scientific personnel and customer support staff, our business may be adversely affected
4. 28develop and retain talented sales personnel or if new sales personnel are unable to achieve desired productivity levels in a reasonable period of time, we may not be able to realize the expected benefits of this investment or increase our revenue
5. 29If we are unable to expand or leverage the number of peer-reviewed articles published using data generated through the use of our products or otherwise increase brand awareness in our target markets, the demand for our products and our business may be adversely affected

Risks Related to Our Regulatory Environment and Our Industry

1. 30Changes in tariffs or other government trade policies may materially adversely affect our business and results of operations, including by reducing demand for our products
2. 31We are subject to governmental export controls that could impair our ability to compete in international markets due to licensing requirements and subject us to liability if we are not in compliance with applicable laws
3. 32operations. Noncompliance with these laws could have negative consequences, including government investigations, penalties, and reputational harm
4. 33products; expenditure of time and resources to defend any claim or inquiry; adverse publicity; or revision or restructuring of our business model or operations
5. 34Our business is subject to environmental regulation and regulations relating to the protection of health and safety matters that could result in compliance costs. Any violation or liability under environmental laws or health and safety regulations could harm our business

Risks Related to Our Financial Position and Capital Requirements

1. 35We may need additional funding and may be unable to raise capital when needed, which could force us to delay, reduce, eliminate, or abandon our commercialization efforts or product development programs
2. 36Our results of operations and liquidity needs could be materially and adversely affected by market fluctuations, an economic downturn, inflation, increases in interest rates, and other macroeconomic conditions
3. 37Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or any guidance we may provide
4. 38Our ability to use our net operating losses, business tax credits, and similar tax attributes to offset future taxable income or taxes may be subject to certain limitations
5. 39Changes in tax laws or regulations that are applied adversely to us or our customers may have a material adverse effect on our business, cash flow, financial condition, or results of operations

Risks Related to Our Operations

1. 40A pandemic, epidemic, outbreak of an infectious disease or other public health emergency in the United States or worldwide could adversely affect our business and the businesses of our partners
2. 41The impact of any of the foregoing, individually or collectively, could adversely affect our business, financial condition, and results of operations
3. 42We outsource certain aspects of our cybersecurity risk management program to a third-party Managed Services Provider (“MSP”) to monitor the security and privacy of our information assets, and any failure to provide such services could have a material adverse effect on our business
4. 43We are highly dependent on our senior management team and key personnel and our business could be harmed if we are unable to attract and retain personnel necessary for our success
5. 44We have increased the size of our organization and expect to further increase it in the future, and we may experience difficulties in managing our growth. If we are unable to manage the anticipated growth of our business, our future revenue and operating results may be harmed
6. 45Our officers, employees, independent contractors, consultants and commercial partners may engage in misconduct or activities that are improper under other laws and regulations, or make significant errors, which could create liability for us
7. 46If we were to be sued for product liability, we could face substantial liabilities that exceed our resources, limit sales of our existing products and limit commercialization of any products that we may develop
8. 47If our customers fail to safely and appropriately use our products, or if we are unable to train our customers on the safe and appropriate use of our products, our reputation may be negatively impacted and we may be unable to achieve our expected sales, growth or profitability
9. 48Litigation and other legal proceedings may harm our business
10. 49We may be subject to damages resulting from claims that we or our employees have wrongfully used or disclosed alleged trade secrets of our employees’ former employers
11. 50Business disruptions could seriously harm our future revenue and financial condition and increase our costs and expenses
12. 51Our insurance policies are expensive and protect us only from some business risks, which leaves us exposed to significant uninsured liabilities
13. 52The majority of our operations are currently conducted at a single location and any disruption at our facility could negatively impact our operations and increase our expenses
14. 53We may face exposure to foreign currency exchange rate fluctuations

Risks Related to Our Intellectual Property

1. 54Our ability to compete and the success of our business could be jeopardized if we are unable to protect our intellectual property adequately
2. 55Legal proceedings to assert our intellectual property rights could be costly and could impair our operations
3. 56We may be sued by third parties for alleged infringement of their proprietary rights, which could be costly and time-consuming and which could limit our ability to use certain technologies in the future or to develop future products
4. 57Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our products
5. 58We may be obligated to disclose our proprietary technology to our customers, which may limit our ability to protect our intellectual property
6. 59Our common stock is traded on two separate stock markets and investors seeking to take advantage of price differences between such markets may create unexpected volatility in our share price; in addition, investors may not be able to easily move shares for trading between such markets
7. 60The price of our common stock is likely to be volatile and may fluctuate due to factors beyond our control
8. 61If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, the price of our common stock and our trading volume could decline
9. 62The requirements of being a public company in the United States may strain our resources, increase our operating costs, divert management’s attention, and affect our ability to attract and retain qualified board members or executive officers
10. 63Increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to our environmental, social and governance practices may impose additional costs on us or expose us to new or additional risks
11. 64Future sales of our common stock in the public market could cause our share price to fall
12. 65Because we do not expect to pay dividends on our common stock in the foreseeable future, capital appreciation, if any, would be your sole source of gain
13. 66Provisions in our governing documents will require disclosure of information about stockholders that would not otherwise be required to be disclosed under applicable U.S. state or federal laws
14. 67We are an “emerging growth company” and a “smaller reporting company,” and we cannot be certain if the reduced reporting requirements applicable to “emerging growth companies” and “smaller reporting companies” will make our common stock less attractive to investors
15. 68Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of our company more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our common stock
16. 69The provisions would not apply to suits brought to enforce a duty or liability created by the Securities Act or the Securities Exchange Act of 1934, as amended. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all such Securities Act actions