NRX Pharmaceuticals (NRXP) risk factors, FY2025 10-K

Other

1. 01We need to raise additional capital to operate our business. If we fail to obtain the capital necessary to fund our operations, we will be unable to continue or complete our product development and we may not be able to continue as a going concern
2. 02We may be unable to access the capital markets and even if we can raise additional funding, we may be required to do so on terms that are dilutive
3. 03We will have broad discretion in using the proceeds of shares sold to investors, and we may not spend the proceeds in an effective manner

Risks Related to Our Business and Industry

1. 04NRX-101 is still in Phase 2/3 of clinical testing
2. 05Our product candidates are newly-formulated and we have not yet scaled manufacturing to levels that will be required for sustained sales
3. 06The outcome of any current or future disputes, claims, arbitration and litigation could have a material adverse effect on our business, financial condition and results of operations
4. 07If we fail to obtain or maintain FDA and other regulatory clearances for our products, or if such clearances are delayed, we will be unable to commercially distribute and market our products
5. 08Our revenue stream will depend upon third-party reimbursement
6. 09We may have conflicts with our partners that could delay or prevent the development or commercialization of our product candidates
7. 10Our products will face significant competition in the markets for such products, and if they are unable to compete successfully, our business will suffer
8. 11We are faced with intense competition and rapid technological change, which may make it more difficult for us to achieve significant market penetration. If we cannot compete successfully for market share against other drug companies, we may not achieve sufficient product revenues and our business will suffer
9. 12Future products may never achieve market acceptance
10. 13To be commercially successful, physicians must be persuaded that using our products are effective alternatives to existing therapies and treatments
11. 14We may incur substantial liabilities and may be required to limit commercialization of our products in response to product liability lawsuits
12. 15We may not be able to obtain Hatch-Waxman Act marketing exclusivity or equivalent regulatory data exclusivity protection in other jurisdictions for our products
13. 16In the future, we may undertake international operations, which would subject us to risks inherent with operations outside of the U.S
14. 17International commercialization of our product candidates requires successful collaborations
15. 18Our business activities could face disruption due to pandemics and other public health emergencies
16. 19Our performance depends on the financial health and strength of our potential customers, which in turn is dependent on the economic conditions of the markets in which we and our customers operate
17. 20We also face risks from financial difficulties or other uncertainties experienced by our suppliers, distributors or other third parties on which we rely. If third parties are unable to supply us with required materials or components or otherwise assist us in operating our business, our business could be harmed
18. 21U.S. and global markets generally experience volatility and disruption as a result of geopolitical tensions and military conflicts, including significant volatility in commodity prices, credit and capital markets, as well as supply chain disruptions
19. 22We may not be successful in hiring and retaining key employees and contractors
20. 23Our employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements
21. 24Our relationships with potential customers and payors will be subject to applicable anti-kickback, fraud and abuse, transparency, and other healthcare laws and regulations, which could expose use to criminal sanctions, civil penalties, contractual damages, reputational harm, and administrative burdens
22. 25Managing our growth as we expand operations may strain our resources and we may not successfully manage our growth
23. 26We may expand our business through the acquisition of rights to new drug candidates that could disrupt our business, harm our financial condition and may also dilute current stockholders ’ ownership interests in our company
24. 27Business interruptions could limit our ability to operate our business
25. 28Cyber security attacks, internal system or service failures may adversely impact our business and operations
26. 29Failure to achieve and maintain effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act could impair our ability to produce timely and accurate financial statements or comply with applicable regulations and have a material adverse effect on our business

Risks Related to Hope Therapeutics

1. 30Our plans to partially spin-off Hope as an independent, publicly traded company may not be completed on the currently contemplated timeline or at all and, if completed, may not achieve the intended benefits and expose us to new risks
2. 31We may engage in future acquisitions or strategic transactions, which may require us to seek additional financing or financial commitments, increase our expenses and/or present significant distractions to our management
3. 32We may not be able to identify, audit, negotiate, finance or close future acquisitions
4. 33Developments by competitors may render our products or technologies obsolete or non-competitive

Risks Related to Clinical and Regulatory Matters

1. 34If we fail to obtain the necessary regulatory approvals, or if such approvals are limited, we will not be allowed to commercialize our drug candidates, and we will not generate product revenues
2. 35Even if a drug product is approved, the regulators may impose limitations on the use or marketing of such product
3. 36After approval, later discovery of previously unknown problems with a product will have adverse consequences for us
4. 37If we are unable to design, conduct and complete clinical trials successfully, our drug candidates will not be able to receive regulatory approval
5. 38Even if the results of Phase 2I clinical trials are positive, we may have to commit substantial time and additional resources to conducting further preclinical studies and clinical trials before obtaining FDA approval for any of our drug candidates
6. 39Any of these delays could significantly impact the timing, approval and commercialization of our drug candidates and could significantly increase our overall costs of drug development
7. 40We cannot predict whether regulatory agencies will determine that the data from our clinical trials of our product candidates supports marketing approval
8. 41There is no guarantee that regulatory authorities will grant NDA approval of our current or future product candidates and failure to obtain necessary clearances or approvals for our current and future product candidates would adversely affect our ability to grow our business
9. 42With respect to clinical trials, discussions and guidance are not binding obligations on the part of regulatory authorities
10. 43The results of our current or future clinical trials may not support our product candidate claims or may result in the discovery of unexpected adverse side effects
11. 44Delays in the commencement or completion of pharmaceutical development, manufacturing or clinical efficacy and safety testing could result in increased costs to us and delay our ability to generate revenues
12. 45We may require the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit
13. 46Development of sufficient and appropriate clinical protocols to demonstrate safety and efficacy are required and we may not adequately develop such protocols to support clearance and approval
14. 47Additional delays to the completion of clinical studies may result from modifications being made to the protocol during the clinical trial, if such modifications are warranted and/or required by the occurrences in the given trial
15. 48There can be no assurance that the data generated using modified protocols will be acceptable to regulators
16. 49If an adverse event occurs during a clinical trial, the regulators or an IRB may delay (clinical hold) or terminate the trial, which could adversely affect our business and prospects
17. 50Developments by competitors may establish standards of care that affect our ability to conduct our clinical trials as planned
18. 51Even if our products are approved by regulatory authorities, if we or our suppliers fail to comply with ongoing FDA regulation or if we experience unanticipated problems with our products, these products could be subject to restrictions or withdrawal from the market
19. 52Future government regulation may affect the commercialization of our product candidate
20. 53Conducting clinical trials of our drug candidates or commercial sales of a drug candidate may expose us to expensive product liability claims and we may not be able to maintain product liability insurance on reasonable terms or at all
21. 54The use of a controlled substance in our NRX-100 drug candidate subjects us to DEA scrutiny and compliance, which may result in additional expense and clinical delays
22. 55There are substantial penalties for failing to comply with DEA regulations
23. 56There are limitations on the availability of controlled substances used in NRX-100 that may limit the availability of the active ingredients for this drug product
24. 57We may not be able to demonstrate the reduced risk we believe is applicable
25. 58The use of controlled substances in our product candidates may generate controversy
26. 59We may need to focus our future efforts in new therapeutic areas where we have little or no experience
27. 60Some of our products for clinical trials may be manufactured outside the U.S
28. 61Modifications to our products may require new NDA approvals
29. 62Some of our other product candidates will require Risk Evaluation and Mitigation Strategies
30. 63We are reliant on third party manufacturers to produce controlled substances that conform to our specifications and the FDA ’ s strict regulatory requirements
31. 64If 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 harm our business
32. 65Although we maintain workers’ compensation insurance to cover us for costs and expenses, we may incur due to injuries to our employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities

Risks Related to Intellectual Property

1. 66Our business relies on certain licensing rights that can be terminated in certain circumstances
2. 67We may require additional licensing rights in the future, which may not be attainable
3. 68We may not succeed at in-licensing drug candidates or technologies to expand our product pipeline
4. 69Our business depends upon securing and protecting critical intellectual property
5. 70Our patent position is highly uncertain and involves complex legal and factual questions
6. 71As a result, the validity of our owned and licensed patents may be challenged and we may not be able to obtain and enforce patents and to maintain trade secret protection for the full commercial extent of our technology. The extent to which we are unable to do so could materially harm our business
7. 72We may be involved in lawsuits to protect or enforce our patents or the patents of our licensors, which could be expensive, time-consuming and unsuccessful and could result in a finding that such patents are unenforceable or invalid
8. 73We have limited foreign intellectual property rights and may not be able to protect our intellectual property rights throughout the world
9. 74If we are found to be infringing on patents or trade secrets owned by others, we may be forced to cease or alter our product development efforts, obtain a license to continue the development or sale of our products, and/or pay damages
10. 75Our ability to protect and enforce our patents does not guarantee that we will secure the right to commercialize our patents
11. 76We rely on confidentiality agreements to protect our trade secrets. If these agreements are breached by our employees or other parties, our trade secrets may become known to our competitors
12. 77We may not receive royalty or milestone revenue relating to our product candidates under our collaboration and future license agreements for several years, or at all

Risks Related to Our Reliance on Third Parties

1. 78We do not have direct control of third parties performing preclinical and clinical trials
2. 79If the third parties on which we rely to conduct our clinical trials and to assist us with pre-clinical development do not perform as contractually required or expected, we may not be able to obtain regulatory approval for or commercialize our products
3. 80We have no manufacturing capabilities and depend on other parties for our manufacturing operations. If these manufacturers fail to meet our requirements and strict regulatory requirements, our product development and commercialization efforts may be materially harmed
4. 81We must enter into agreements with, and depend upon, one or more partners to assist us in commercializing our product candidates
5. 82Upon commercialization of our products, we may be dependent on third parties to market, distribute and sell our products. If we are not successful in contracting with third parties for these services on favorable terms, or at all, our product revenues could be disappointing

Risks Related to Ownership of Our Common Stock

1. 83Our issuance of additional shares of common stock or convertible securities could make it difficult for another company to acquire us, may dilute your ownership of us and could adversely affect our stock price
2. 84Future sales, or the perception of future sales, of our common stock by us or our existing stockholders in the public market could cause the market price for our common stock to decline
3. 85Anti-takeover provisions in our governing documents and under Delaware law could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our common stock
4. 86Certain of our stockholders have effective control of NRx, and their interests may conflict with NRx ’ s or yours in the future
5. 87Our Charter will not prevent Jonathan Javitt and Daniel Javitt and their respective affiliates from engaging in business activities which compete with us or otherwise conflict with our interests

General Risk Factors

1. 88Our common stock price may be volatile or may decline regardless of our operating performance. You may lose some or all of your investment
2. 89If securities analysts do not publish research or reports about us, or if they issue unfavorable commentary about us or our industry or downgrade our common stock, the price of our common stock could decline
3. 90The obligations associated with being a public company will involve significant expenses and will require significant resources and management attention, which may divert from our business operations
4. 91If we fail to meet the applicable continued listing requirements of the Nasdaq Capital Market, Nasdaq may delist our common stock, in which case the liquidity and market price of our common stock could decline
5. 92We do not intend to pay cash dividends on our common stock for the foreseeable future