Processa Pharmaceuticals (PCSA) risk factors, FY2024 10-K

Risks Related to Our Financial Position and Need for Additional Capital

1. 01We need to raise additional capital to fund our operations
2. 02We have limited cash resources and will require additional financing
3. 03We will need to raise additional capital to complete the development efforts for NGC-Cap, NGC-Gem and/or NGC-Iri. If we are unable to raise capital when needed, we could be forced to delay, reduce or terminate certain of our development programs or other operations
4. 04Our financial statements contain a statement regarding a substantial doubt about our ability to continue as a going concern
5. 05Our ability to use our net operating loss carryforwards and other tax attributes may be limited

Risks Relating to Clinical Development and Commercialization of Our Product Candidates

1. 06Our licenses are subject to termination by the licensor in certain circumstances and any termination of a license agreement would result in a loss of important rights and have a material adverse impact on our business and prospects
2. 07We currently do not have, and may never develop, any FDA-approved, licensed or commercialized products
3. 08We must successfully complete clinical trials for our product candidates before we can apply for marketing approval
4. 09We are not permitted to market our product candidates as prescription pharmaceutical products in the United States until we receive approval of an NDA from the FDA, or in any foreign countries until we receive the requisite approval from such countries
5. 10Furthermore, we may not have the financial resources to continue development of, or to enter into collaborations for, a product candidate if we experience any problems or other unforeseen events that delay or prevent regulatory approval of, or our ability to commercialize, product candidates
6. 11Disruptions at the FDA and other government agencies could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved, or commercialized in a timely manner or at all, which could negatively impact our business
7. 12Even if we receive regulatory approval for any of our product candidates, we may not be able to successfully license or commercialize the product and the revenue that we generate from its sales, if any, may be limited
8. 13Even if we obtain marketing approval for any of our product candidates, we will be subject to ongoing obligations and continued regulatory review, which may result in significant additional expenses
9. 14Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our product candidates in other jurisdictions
10. 15Recently enacted and future legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and affect the prices we may obtain
11. 16We could face competition from other biotechnology and pharmaceutical companies, and our operating results would suffer if we fail to innovate and compete effectively
12. 17Clinical drug development involves a lengthy and expensive process with an uncertain outcome, and results of earlier studies and trials may not be predictive of future trial results
13. 18Even though we may apply for orphan drug designation for a product candidate, we may not be able to obtain orphan drug marketing exclusivity
14. 19Although we may pursue expedited regulatory approval pathways for a product candidate, it may not qualify for expedited development or, if it does qualify for expedited development, it may not actually lead to a faster development, regulatory review or approval process
15. 20Third-party coverage and reimbursement, health care cost containment initiatives and treatment guidelines may constrain our future revenues
16. 21Legal, regulatory and legislative changes with respect to reimbursement, pricing and contracting may adversely affect our business and future prospects
17. 22We may face product liability exposure, and if successful claims are brought against us, we may incur substantial liability if our insurance coverage for those claims is inadequate
18. 23We may choose not to continue developing or commercializing any of our product candidates at any time during development or after approval, which would reduce or eliminate our potential return on investment for those product candidates
19. 24Changes in U.S. and international trade policies, particularly with respect to China, Europe and India may adversely impact our business and operating results

Risks Relating to Our Intellectual Property Rights

1. 25We cannot ensure protection of our licensed intellectual property rights
2. 26If we fail to obtain or maintain patent or trade secret protection for our product candidates or our technologies, third parties could use our licensed or owned intellectual property, which could impair our ability to compete in the market and adversely affect our ability to generate revenues and attain profitability
3. 27Our product candidates may infringe the intellectual property rights of others, which could increase our costs and delay or prevent our development and commercialization efforts
4. 28Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements

General Company-Related Risks

1. 29Litigation or legal proceedings could expose us to significant liabilities and have a negative impact on our business
2. 30If we lose key management personnel, or if we fail to recruit additional highly skilled personnel, our ability to identify and develop new or next generation product candidates will be impaired, could result in loss of markets or market share and could make us less competitive
3. 31Cyberattacks, malicious internet-based activity, online and offline fraud and other similar activities threaten the confidentiality, integrity, and availability of our sensitive information and information technology systems, and those of the third parties upon which we rely
4. 32We are exposed to cyber-attacks and data breaches, including the risks and costs associated with protecting our systems and maintaining integrity and security of our business information, as well as personal data of our guests, employees and business partners

Risks Related to Ownership of Our Common Stock

1. 33Our failure to maintain compliance with Nasdaq’s continued listing requirements could result in the delisting of our Common Stock
2. 34Our common stock is currently listed for trading on The Nasdaq Capital Market. We must satisfy The Nasdaq Capital Market’s continued listing requirements risk delisting, which would have a material adverse effect on our business
3. 35Future equity offerings, license transactions or acquisitions may dilute our existing stockholders’ ownership and/or have other adverse effects on our operations
4. 36Our common stock price is expected to be volatile
5. 37We are a “smaller reporting company,” and the reduced disclosure requirements applicable to us as such may make our common stock less attractive to our stockholders and investors
6. 38We do not currently intend to pay dividends to our stockholders in the foreseeable future, and consequently, your ability to achieve a return on your investment will depend on appreciation in our value
7. 39If securities or industry analysts do not publish research or reports about our business, or if they publish negative evaluations of our stock or negative reports about our business, our stock price and trading volume could decline
8. 40Provisions in our corporate documents and Delaware law could have the effect of delaying, deferring, or preventing a change in control of us, even if that change may be considered beneficial by some of our stockholders
9. 41Provisions in our bylaws provide for indemnification of officers and directors, which could require us to direct funds away from our business and the development of our product candidates