PharmaCyte Biotech (PMCB) risk factors, FY2025 10-K

Other

1. 01Forward-Looking Statements and Associated Risks
2. 02Summary of Risks Associated with Our Business

Risks Related to Our Financial Position, FDA Clinical Hold, Need for Additional Capital and Overall Business

1. 03We are a biotechnology company with limited resources, a limited operating history, and no products approved for clinical trials or commercial sale, which may make it difficult to evaluate our current business and predict our future success and viability
2. 04Our product candidates that we may develop may compete with other product candidates and products for access to manufacturing facilities. There are a limited number of manufacturers that operate under cGMP regulations and that might be capable of manufacturing products for us
3. 05If we are unable to successfully raise additional capital, our future clinical trials and product development could be limited, and our long-term viability may be threatened
4. 06We currently have no commercial revenue and may never become profitable
5. 07We are unable to predict the timing or amount of increased expenses, or when or if we will be able to achieve or maintain profitability. Even if we can complete the processes described above, we anticipate incurring significant costs associated with commercializing our product candidates
6. 08We face substantial competition, which may result in others discovering, developing or commercializing competing products before or more successfully than we do
7. 09Our future revenues are unpredictable which causes potential fluctuations in operating results
8. 10We may be unable to adequately protect our information systems from cyberattacks, which could result in the disclosure of confidential or proprietary information, including personal data, damage our reputation, and subject us to significant financial and legal exposure

Risks Related to Regulatory Matters

1. 11If we are unable to obtain, or if there are delays in obtaining, required approval from the applicable regulatory agencies, we will not be able to commercialize our product candidates and our ability to generate revenue will be materially impaired
2. 12If allowed to proceed with our clinical development programs, we intend to conduct clinical trials for certain of our product candidates at sites outside of the U.S., and the U.S. regulatory agencies may not accept data from trials conducted in such locations
3. 13Our plan to first pursue a clinical trial before a pivotal Phase 3 trial will likely result in additional costs to us and resultant delays in the FDA review process and any future commercialization and marketing if regulatory approval is obtained
4. 14Development of a biologic involves a lengthy and expensive process with an uncertain outcome. We may incur additional costs or experience delays in completing or be unable to complete the development and commercialization of our product candidates
5. 15We may experience significant delays in pursuing any clinical trials, and any planned clinical trials may not begin on time, may require redesign, may not enroll sufficient healthy volunteers or patients in a timely manner and may not be completed on schedule, if at all
6. 16Many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of marketing approval for our product candidates
7. 17We are seeking FDA approval to commence clinical trials in the U.S. of certain of our product candidates based on clinical data that was obtained in trials conducted outside the U.S., and it is possible that the FDA may not accept data from trials conducted in such locations or conducted nearly 20 years ago
8. 18Results in previous clinical trials of our encapsulated live cell and ifosfamide combination for pancreatic cancer may not be replicated in future clinical trials which could result in development delays or a failure to obtain marketing approval
9. 19If we experience delays or difficulties in the enrollment of patients in clinical trials, we may not achieve our clinical development timeline and our receipt of necessary regulatory approvals could be delayed or prevented
10. 20Receiving priority review from the regulatory agencies does not guarantee approval within an accelerated timeline or thereafter
11. 21We currently have Orphan Drug designation for our product candidate for the treatment of pancreatic cancer, and may seek Orphan Drug designation for additional product candidates, and we may be unsuccessful in obtaining or maintaining such designations
12. 22A Fast Track by the FDA or similar designation by another regulatory agency, even if granted for any of our product candidates, may not lead to a faster development or regulatory review or approval process and does not increase the likelihood that our product candidates will receive marketing approval
13. 23Failure to obtain marketing approval in international jurisdictions would prevent our product candidates from being marketed abroad
14. 24Biologics carry unique risks and uncertainties, which could have a negative impact on future results of operations
15. 25Our relationships with customers and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, substantial civil penalties, contractual damages, reputational harm and diminished profits and future earnings
16. 26Analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers
17. 27Recently enacted and future legislation could increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and affect the prices we may obtain
18. 28Even if we are able to commercialize any of our drug candidates, such products may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives, which would harm our business

Risks Related to the Commercialization of Our Product Candidates

1. 29Serious adverse events or undesirable side effects or other unexpected properties of our encapsulated live cell plus ifosfamide product candidate or any of our other product candidates may be identified during development that could delay or prevent the product candidates’ marketing approval
2. 30If any of our product candidates receives marketing approval and we or others later discover that the therapy is less effective than previously believed or causes undesirable side effects that were not previously identified, our ability to market the therapy could be compromised
3. 31If we are unable to establish sales, marketing and distribution capabilities or enter acceptable sales, marketing and distribution arrangements with third parties, we may not be successful in commercializing any product candidate that we develop when a product candidate is approved

Risks Related to Our Dependence on Third Parties

1. 32We rely heavily on third parties to conduct our preclinical studies and plan to rely on third parties to conduct our clinical trials, assuming they are allowed to proceed, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such studies and trials
2. 33Future preclinical and clinical development collaborations may be important to us. If we are unable to maintain these collaborations, or if these collaborations are not successful, our business could be adversely affected

Risks Related to our Intellectual Property

1. 34We may not be able to protect our intellectual property rights throughout the world
2. 35Our intellectual property and data and market exclusivity may not be sufficient to block others from commercializing identical or competing products
3. 36Even if we are able to obtain patents, maintain confidential information, trade secrets, obtain data, and market exclusivity for our product candidates, our competitors may be able to develop and obtain approval of identical or competing products
4. 37We cannot estimate the financial or other impact of the expiration of the Bavarian Nordic/GSF patents or the failure of the USPTO or similar regulatory authorities in other countries denying the claims we pursue in the U.S. and other countries
5. 38Our commercial success will largely depend on our ability to obtain and maintain patent and other intellectual property protection and/or data exclusivity under the BPCIA in the U.S. and other countries with respect to our proprietary technology, product candidates and our target indications
6. 39Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies. Our patent protection could be reduced or eliminated for non-compliance with these requirements
7. 40We may become involved in lawsuits to protect or enforce our patents or other intellectual property, which could be expensive, time consuming and unsuccessful
8. 41If we breach any of our license or collaboration agreements, it could compromise our development and commercialization efforts for our product candidates
9. 42We may need to license certain intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms
10. 43Third parties may initiate legal proceedings alleging that we are infringing their intellectual property rights, the outcome of which would be uncertain and could have a material adverse effect on the success of our business
11. 44We may not be successful in obtaining or maintaining necessary rights for its development pipeline through acquisitions and licenses from third parties
12. 45If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed
13. 46We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information of their former employers or other third parties
14. 47Any trademarks we have obtained or may obtain may be infringed or successfully challenged, resulting in harm to our business
15. 48Intellectual property rights do not necessarily address all potential threats to our competitive advantage

Risks Related to Our Business Model and Operations

1. 49Development of brand awareness is critical to our success
2. 50Any weakness in our internal controls could have a material adverse effect on us
3. 51The insurance coverage and reimbursement status of newly approved products are uncertain. Failure to obtain or maintain adequate coverage and reimbursement for new or current products could limit our ability to market those products and decrease our ability to generate revenue
4. 52Our employees, consultants and independent contractors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could subject us to significant liability and harm our reputation
5. 53Our transactions and relationships outside the U.S. will be subject to the FCPA and similar anti-bribery and anti-corruption laws
6. 54Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop
7. 55We incur increased costs because of operating as a public company, and our management is required to devote substantial time to new compliance initiatives
8. 56Risk Factors Related to Our Stock and Financial Condition
9. 57You may experience future dilution as a result of future equity offerings
10. 58We may not be able to meet the continued listing requirements for Nasdaq or another nationally recognized stock exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions
11. 59We may obtain additional capital through the issuance of preferred stock, which may limit your rights as a holder of our common stock
12. 60We may experience volatility in our stock price, which may adversely affect the trading price of our common stock
13. 61The price of our common stock is volatile, which substantially increases the risk that our investors may not be able to sell their shares at or above the price that the investors have paid for their shares
14. 62We have no plans to pay dividends in the foreseeable future, and investors may not expect a dividend as a return of or on any investment in us
15. 63We are a “smaller reporting company” under the Commission’s disclosure rules and have elected to comply with the reduced disclosure requirements applicable to smaller reporting companies
16. 64As a non-accelerated filer, we are not required to comply with the auditor attestation requirements of the Sarbanes-Oxley Act
17. 65We face risks related to owning securities issued by other public companies
18. 66The TNF Preferred Shares are convertible at a conversion price of $0.1832 per share. To the extent we convert the TNF Preferred Shares when the market price of the TNF Common Shares is lower than the conversion price, we may realize a loss equal to the difference between the conversion price and the market price
19. 67The TNF Warrants are exercisable at an exercise price of $0.1832 per share. There can be no assurance that the TNF Warrants will be in the money when exercisable, and as such they may expire worthless

Risks Related to Employee and Tax Matters, Managing Growth and Macroeconomic Conditions

1. 68We have experienced significant management changes which could increase our control risks and have a material adverse effect on our ability to do business and our results of operations
2. 69We have a limited number of employees and are highly dependent on our Chief Executive Officer and Chief Financial Officer. Our future success depends on our ability to retain these officers and other key personnel and to attract, retain and motivate other needed qualified personnel
3. 70Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited
4. 71We expect to expand our development and regulatory capabilities and potentially implement sales, marketing and distribution capabilities. Thus, we may encounter difficulties in managing our growth, which could disrupt our operations
5. 72Our business and operations would suffer in the event of system failures
6. 73We are subject to legal, regulatory, financial and other risks with our operations outside the U.S