Vivani Medical (VANI) risk factors, FY2024 10-K

Risks Related to Our Financial Position and Need for Additional Capital

1. 01We are a clinical-stage company with a limited operating history, and have no products approved for commercial sale
2. 02We do not anticipate generating revenue from product sales for the foreseeable future and may never be profitable
3. 03Our ability to utilize its net operating loss (“NOL”) carry-forwards and certain other tax attributes may be limited
4. 04Reserve for uncertain income tax positions Nil

Risks Related to Product Development, Clinical Testing and Commercialization

1. 05We are dependent on the successful design, development, regulatory approval and commercialization of one or more of our product candidates, there can be no assurance that we may achieve any of these objectives
2. 06Clinical development involves a lengthy and expensive process with uncertain outcomes. We may incur additional costs and experience delays in developing our product candidates, and our clinical development efforts may not yield favorable results
3. 07For example, our IND for the NPM-119 program was on full clinical hold between August 2023 and June 2024
4. 08Our efforts to identify and develop product candidates beyond those in our current pipeline may not succeed, and any product candidates that we select for clinical development may not actually begin clinical trials
5. 09We could experience delays in the commencement or completion of clinical trials, which could result in increased costs or otherwise impair our research and development efforts
6. 10Results of preclinical trials may not be predictive of the results of later-stage clinical trials, and many product candidates fail to achieve regulatory approval despite showing initial promise in early-stage testing
7. 11Interim, topline and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data
8. 12We may experience delays in the enrollment of patients in our clinical trials, which would adversely affect our ability to initiate, conduct and complete such trials on our anticipated timelines
9. 13Even once enrolled we must retain a sufficient number of patients to complete any of our trials
10. 14We may experience difficulty identifying, training and/or certifying an adequate number of healthcare professionals to properly implant and, when appropriate, explant our drug implants candidates, which may impair our ability to conduct our clinical trials
11. 15If our competitors have product candidates that are approved faster, marketed more effectively, are better tolerated, have a more favorable safety profile, or are demonstrated to be more effective than our own, our commercial opportunity may be reduced or eliminated
12. 16If the FDA or other applicable regulatory authorities approve generic products that compete with any of our product candidates, the sales of our product candidates, if approved, could be adversely affected
13. 17We are subject to a multitude of complex manufacturing challenges and risks, including reliance on third parties, any of which could substantially increase our costs and limit supply of our product candidates
14. 18The commercial success of our product candidates, if approved, depends upon their market acceptance among physicians, patients, healthcare payors, and the medical community
15. 19If we fail to obtain and sustain an adequate level of reimbursement by third-party payors for our product candidates, if approved, potential future sales would be materially adversely affected
16. 20If the prices for our product candidates, if approved, are reduced or if governmental and other third-party payors do not provide adequate coverage and reimbursement of our products, our future revenue, cash flows and prospects for profitability will suffer

Risks Related to Regulatory Approval and Other Legal and Compliance Matters

1. 21Our product candidates are subject to extensive regulation under the FDA, the EMA and comparable foreign regulatory authorities, and must undergo extensive clinical testing that can be costly and time consuming, with no assurance that regulatory approval will be obtained for any of our product candidates
2. 22Final marketing approval of NPM-115 or any of our other product candidates by the FDA or other regulatory authorities may be delayed, limited, or denied, any of which would adversely affect our ability to generate operating revenues
3. 23Additional time may be required to obtain regulatory approval for our product candidates because they are combination products
4. 24We and our contract manufacturers are subject to significant regulation with respect to manufacturing our product candidates. The manufacturing facilities on which we rely may not continue to meet regulatory requirements
5. 25Even if one or more of our product candidates receive regulatory approval in the U.S., we may never receive comparable approvals outside of the U.S
6. 26The FDA, the EMA and comparable foreign regulatory authorities actively enforce the laws and regulations prohibiting the promotion of off-label uses
7. 27Current and future legislation may increase the difficulty and cost of commercializing our product candidates and may affect the prices that we may obtain if our product candidates are approved for commercialization
8. 28We may be exposed to product liability risks which could place a substantial financial burden on our business
9. 29Our research and development activities involve the use of hazardous materials, which are subject to regulation, related costs and delays and potential liabilities

Risks Relating to Our Intellectual Property

1. 30We may not be able to adequately protect our proprietary or licensed technology
2. 31We may not be successful in obtaining or maintaining necessary rights to develop and commercialize our product candidates
3. 32We may infringe the intellectual property rights of others, which may prevent or delay our development efforts and prevent us from commercializing or increase the costs of commercializing our product candidates, if approved
4. 33An NDA submitted under Section 505(b)(2) subjects us to the risk that we may be subject to a patent infringement lawsuit that would delay or prevent the review or approval of our product candidates
5. 34Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our product candidates
6. 35We may not be able to protect our intellectual property rights throughout the world
7. 36We may be unable to adequately prevent disclosure of trade secrets and other proprietary information
8. 37We may be subject to claims that our employees, consultants, or independent contractors have wrongfully used or disclosed confidential information of third parties
9. 38If we do not obtain additional protection under the Hatch-Waxman Amendments and similar foreign legislation extending the terms of our patents and any future patents we may own, our business, financial condition and results of operations may be materially and adversely affected

Risks Related to Our Reliance on Third Parties

1. 39Use of third parties to manufacture our product candidates may increase the risk that we will not have sufficient quantities of our product candidates, products, or necessary quantities at an acceptable cost
2. 40Our efforts to seek, secure and maintain partnerships, collaborations or other strategic initiatives with respect to one or more of our programs may not be successful
3. 41If we are unable to develop our own commercial organization or enter into agreements with third parties to sell and market our product candidates, if approved, we may be unable to generate significant revenues
4. 42Our current and future relationships with investigators, healthcare professionals, consultants, third-party payors, and customers will be subject to applicable healthcare regulatory laws. Failure to comply with those laws could have a material adverse effect on our results of operations and financial condition

Risks Related to Ownership of Our Common Stock

1. 43Our principal stockholders and management own a significant percentage of our stock and will be able to exercise significant influence over matters subject to stockholder approval
2. 44Because we became a reporting company under the Exchange Act by means other than a traditional underwritten initial public offering, we may not be able to attract the attention of research analysts at major brokerage firms
3. 45Because we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain
4. 46The designation of our common stock as “penny stock” would limit the liquidity of our common stock
5. 47FINRA sales practice requirements may limit a stockholder’s ability to buy and sell our common stock
6. 48The market price of our common stock may be highly volatile, and may be influenced by numerous factors, some of which are beyond our control
7. 49If we fail to retain current members of our senior management and scientific personnel, or to attract and keep additional key personnel, our ability to conduct our business will be impaired
8. 50We will need to increase the size of our organization and may not successfully manage our growth
9. 51Our employees, independent contractors, vendors, principal investigators, CROs and consultants may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading
10. 52If we fail to maintain proper and effective internal control over financial reporting, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our common stock may decline
11. 53Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud
12. 54We will continue to incur increased costs as a result of being a public company and our management will be required to devote substantial time to new compliance initiatives and corporate governance practices
13. 55We are a smaller reporting company, and we cannot be certain if the reduced reporting requirements applicable to smaller reporting companies will make our common stock less attractive to investors
14. 56Rising inflation rates could negatively impact our expenses
15. 57We may not be able to complete the spin-off of Cortigent on the terms anticipated or at all
16. 58The spin-off may not have the benefits we anticipate
17. 59There could be significant income tax liability if the spin-off or certain related transactions are determined to be taxable for U.S. federal income tax purposes