Orchestra BioMed Holdings (OBIO) risk factors, FY2024 10-K

Risks Related to Our Business and Products

1. 01We may need substantial additional funding. If we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our product development programs or commercialization efforts
2. 02manufacturing efforts, as well as the potential receipt of revenues or other payments or investments under a restructured Terumo Agreement, the Medtronic Agreement and/or future collaborations, and the realization of cash from the acquisition of Vivasure by Haemonetics
3. 03We currently have a limited operating history and limited sources of revenue and may never become profitable
4. 04If we do not achieve our projected development and commercialization goals, our business may be harmed
5. 05additional preclinical studies or clinical studies. Any of these occurrences could have an adverse effect on our business, financial condition and results of operations
6. 06We may be unable to compete successfully with larger companies in our highly competitive industry
7. 07and to focus on a larger number of potential customers, which would give them a significant advantage over the sales and marketing team we would use and our international distributors in making sales
8. 08The sizes of the markets for product candidates have not been established with precision, and may be smaller than we estimate
9. 09Any of these events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved or certified, and could seriously harm our business
10. 10If we make acquisitions, we could incur significant costs and encounter difficulties that harm our business
11. 11If we do not manage our growth or control costs related to growth, our results of operations will suffer
12. 12Litigation and other legal proceedings may adversely affect our business
13. 13Product liability and other claims against us may reduce demand for our products or result in substantial damages
14. 14We currently have product liability insurance for $6.0 million per occurrence with an annual aggregate maximum of $6.0 million
15. 15Economic conditions may adversely affect our business, financial condition and share price
16. 16Business disruptions could seriously harm our future revenue and financial condition and increase our costs and expenses
17. 17These and other risks associated with our international operations may materially adversely affect our ability to attain or maintain profitable operations, which would have a material adverse effect on our business, financial condition and results of operations
18. 18Our ability to utilize our net operating loss carryforwards and certain other tax attributes may be limited

Risks Related to Our Reliance on Third Parties

1. 19the completion of negotiations. The Terumo Agreement provides that matters that are not resolved through mediation are to be resolved by binding arbitration conducted under the auspices of the ICDR in accordance with its International Arbitration Rules
2. 20If the mediation does not lead to an agreement or resolution, or, if applicable, we do not prevail in arbitration, or if the Terumo Agreement is terminated, our clinical study, product development, and commercialization plans for Virtue SAB may be further adversely impacted
3. 21We and our partners may be unable to sustain revenue growth

Risks Related to Government Regulation and Our Industry

1. 22Healthcare reform initiatives and other administrative and legislative proposals may adversely affect our business
2. 23accountable care organizations. It is unclear what effect new quality and payment programs, such as MACRA, may have on our business, financial condition, results of operations or cash flows
3. 24approvals or certifications; withdrawals or suspensions of current approvals or certifications, resulting in prohibitions on sales of our products; and, in the most serious cases, criminal penalties
4. 25The aforementioned EU rules are generally applicable in the EEA (which consists of the 27 EU member states plus Norway, Liechtenstein and Iceland). Non-compliance with the above requirements would also prevent us from selling our products in these countries
5. 26If any of these events occurs, our reputation could be harmed, we could be exposed to product liability claims and we could lose customers and experience reduced sales and increased costs
6. 27Virtue SAB is a drug/device combination, which may result in additional regulatory and other risks
7. 28process, as well as coordination between two different centers within FDA responsible for review of the different components of the combination product
8. 29Changes in methods of product candidate manufacturing or formulation may result in additional costs or delay
9. 30additional mechanisms, at significant cost and diversion of management attention, to ensure compliance with the new data protection rules. This may be onerous and may adversely affect our business, operations and financial performance
10. 31Environmental and health safety laws may result in liabilities, expenses and restrictions on our operations

Risks Related to Our Intellectual Property

1. 32We may be unable to enforce our intellectual property rights throughout the world
2. 33If we cannot protect and control unpatented trade secrets, know-how and other proprietary technology, we may suffer competitive harm
3. 34Obtaining and maintaining our patent protection depends on compliance with various procedural measures, document submissions, fee payments and other requirements imposed by government patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements
4. 35Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our products
5. 36Patent terms may be inadequate to protect our competitive position on our product candidates for an adequate amount of time

Risks Related to Ownership of Our Common Stock

1. 37Anti-takeover provisions contained in our Charter and our Bylaws and under Delaware law could impair a takeover attempt
2. 38The price of our securities may be volatile
3. 39Moreover, in the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities. If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business
4. 40Sales of a substantial number of shares of our common stock in the public market could occur at any time. If our existing stockholders sell substantial amounts of common stock in the public market, or the market perceives that they intend to do so, the market price of our common stock could decline
5. 41Our warrants may not be exercised at all and we may not receive any cash proceeds from the exercise of the warrants
6. 42Our failure to meet Nasdaq’s continued listing requirements could result in a delisting of our common stock
7. 43We face increased legal, accounting, administrative and other costs and expenses as a public company. These increased costs require us to divert a significant amount of money and management attention that could otherwise be used to expand the business and achieve strategic objectives

Risks Related to Our Operations in Israel

1. 44The research and development facilities of Motus GI Technologies, our wholly owned subsidiary and some of our suppliers are located in Israel and, therefore, our business, financial condition and results of operation may be adversely affected by political, economic and military instability in Israel
2. 45In particular, on October 7, 2023, war broke out between Israel and the terrorist organizations in the Gaza Strip, following a surprise attack on Israel led by certain armed groups in the Gaza Strip. To date, our operations in Israel have not been significantly impacted by the ongoing war
3. 46We may become subject to claims for payment of compensation for assigned service inventions by Motus GI Technologies’ current or former employees, which could result in litigation and adversely affect our business