Acasti Pharma Inc. (ACST) 2023年年度報告「TSX-V」.pdf

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1、 UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549 FORM 10-K(Mark One)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended March 31,2023or TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934

2、For the transition period from to Commission file number:001-35776 ACASTI PHARMA INC.(Exact name of registrant as specified in its charter)Qubec,Canada98-1359336(State or other jurisdictionof incorporation or organization)(I.R.S.Employer Identification Number)3009 boul.de la Concorde East,Suite 102,

3、Laval,Qubec,Canada H7E 2B5(Address of principal executive offices,including zip code)Registrants telephone number,including area code:450-687-2262 Securities registered pursuant to Section 12(b)of the Act:Title of each class Name of each exchange on which registeredCommon Shares,no par value per sha

4、re Nasdaq Stock Market Securities registered pursuant to Section 12(g)of the Act:NoneIndicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Secti

5、on 13 or 15(d)of the Act.Yes No Indicate by check mark whether the registrant:(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12 months(or for such shorter period that the registrant was required to file such reports),an

6、d(2)has been subject to such filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(o

7、r for such shorter period that the registrant was required to submit such files).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or an emerging growth company.See definitions of“large accelerat

8、ed filer,”“accelerated filer,”“smaller reporting company,”and“emerging growth company”in Rule 12b-2 of the Exchange Act.Large accelerated filerAccelerated filer Non-accelerated filerSmaller reporting company Emerging growth company If an emerging growth company,indicate by check mark if the registra

9、nt has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the

10、 effectiveness of its internal control over financial reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm that prepared or issued its audit report.Yes No If securities are registered pursuant to Section 12(b)of the Act,indicate by check ma

11、rk whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation r

12、eceived by any of the registrants executive officers during the relevant recovery period pursuant to 240.10D-1(b).Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Securities Exchange Act of 1934).Yes No The aggregate market value of the voting and non-

13、voting common shares held by non-affiliates of the registrant,based on the closing sale price of the registrants common shares on the last business day of its most recently completed second fiscal quarter,as reported on the Nasdaq Stock Market,was approximately$26,031,587.The number of outstanding c

14、ommon shares of the registrant,no par value per share,as of June 23,2023,was 44,612,831.Auditor Firm Id:1263 Auditor Name:Ernst&Young LLP Auditor Location:Montral,QC,CanadaFormer Auditor Firm Id:85 Auditor Name:KPMG LLP Auditor Location:Montral,QC,Canada ACASTI PHARMA INC.FORM 10-KFor the Fiscal Yea

15、r Ended March 31,2023Table of Contents PART I Item 1.Business7 Item 1A.Risk Factors16 Item 1B.Unresolved Staff Comments36 Item 2.Properties36 Item 3.Legal Proceedings36 Item 4.Mine Safety Disclosures36PART II Item 5.Market for Registrants Common Equity,Related Shareholder Matters and Issuer Purchase

16、s of Equity Securities37 Item 6.Reserved40 Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operation41 Item 7A.Quantitative and Qualitative Disclosure About Market Risk51 Item 8.Financial Statements and Supplementary Data51 Item 9.Changes in and Disagreements with Ac

17、countants on Accounting and Financial Disclosure51 Item 9A.Controls and Procedures51 Item 9B.Other Information51 Item 9C.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections PART III Item 10.Directors,Executive Officers and Corporate Governance52 Item 11.Executive Compensation54 Item

18、12.Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters60 Item 13.Certain Relationships and Related Transactions and Director Independence61 Item 14.Principal Accounting Fees and Services63PART IV Item 15.Exhibits,Financial Statement Schedules65 Item 16.Form

19、 10-K Summary65SIGNATURES SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This annual report contains information that may be forward-looking information within the meaning of Canadian securities laws and forward-looking statements within the meaning of U.S.federal securities laws,both of which we

20、 refer to in this annual report as forward-looking information.Forward-looking information can be identified by the use of terms such as“may”,“will”,“should”,“expect”,“plan”,“anticipate”,“believe”,“intend”,“estimate”,“predict”,“potential”,“continue”or other similar expressions concerning matters tha

21、t are not statements about the present or historical facts.Forward-looking information in this annual report includes,among other things,information or statements about:our ability to build a premier,late-stage specialty pharmaceutical company focused in rare and orphan disease and,on developing and

22、 commercializing products that improve clinical outcomes using our novel drug delivery technologies;our ability to apply new proprietary formulations to existing pharmaceutical compounds to achieve enhanced efficacy,faster onset of action,reduced side effects,and more convenient drug delivery that c

23、an result in increased patient compliance;the potential for our drug candidates to receive orphan drug designation from the U.S.Food and Drug Administration(“FDA”)or regulatory approval under the Section 505(b)(2)regulatory pathway under the Federal Food,Drug and Cosmetic Act;the future prospects of

24、 our GTX-104 drug candidate,including but not limited to GTX-104s potential to be administered to improve the management of hypotension in patients with subarachnoid hemorrhage(“SAH”);GTX-104s potential to reduce the incidence of vasospasm in SAH patients resulting in better outcomes;the ability of

25、GTX-104 to achieve a pharmacokinetic(“PK”)and safety profile similar to the oral form of nimodipine;GTX-104s potential to provide improved bioavailability and the potential for reduced use of rescue therapies,such as vasopressors in patients with SAH the timing and outcome of the Phase 3 safety stud

26、y for GTX-104;our ability to ultimately file a new drug application(“NDA”)for GTX-104 under Section 505(b)(2)of the Federal Food,Drug and Cosmetic Act;and the timing and ability to receive FDA approval for marketing GTX-104;our plan to prioritize the development of GTX-104;our plan to maximize the v

27、alue of our de-prioritized drug candidates,GTX-102 and GTX-101,including through potential development,out-licensing or sale of those drug candidates;the future prospects of our GTX-102 drug candidate,including but not limited to GTX-102s potential to provide clinical benefits to decrease symptoms a

28、ssociated with Ataxia Telangiectasia(“A-T”);GTX-102s potential ease of drug administration;the timing and outcomes of a PK bridging study and a Phase 3 efficacy and safety study for GTX-102;the timing of an NDA filing under Section 505(b)(2)in connection with GTX-102;and the ability to receive FDA a

29、pproval for marketing GTX-102;the future prospects of our GTX-101 drug candidate,including but not limited to GTX-101s potential to be administered to postherpetic neuralgia(“PHN”)patients to treat the severe nerve pain associated with the disease;assumptions about the biphasic delivery mechanism of

30、 GTX-101,including its potential for rapid onset and continuous pain relief for up to eight hours;and the timing and outcomes of single ascending dose/multiple ascending dose and PK bridging studies,and a Phase 2 and Phase 3 efficacy and safety study;the timing of an NDA filing under Section 505(b)(

31、2)for GTX-101;and the timing and ability to receive FDA approval for marketing GTX-101;the quality of our clinical data,the cost and size of our development programs,expectations and forecasts related to our target markets and the size of our target markets;the cost and size of our commercial infras

32、tructure and manufacturing needs in the United States,European Union,and the rest of the world;and our expected use of a range of third-party contract research organizations(“CROs”)and contract manufacturing organizations(“CMOs”)at multiple locations;expectations and forecasts related to our intelle

33、ctual property portfolio,including but not limited to the probability of receiving orphan drug designation from the FDA for our leading pipeline products;our patent portfolio strategy;and outcomes of our patent filings and extent of patent protection;our strategy,future operations,prospects and the

34、plans of our management with a goal to enhance shareholder valueour intellectual property position and duration of our patent rights;our need for additional financing,and our estimates regarding our operating runway and timing for future financing and capital requirements;our expectation regarding o

35、ur financial performance,including our costs and expenses,liquidity,and capital resources;our projected capital requirements to fund our anticipated expenses;and our ability to establish strategic partnerships or commercial collaborations or obtain non-dilutive funding.Although the forward-looking s

36、tatements in this annual report are based upon what we believe are reasonable assumptions,you should not place undue reliance on those forward-looking statements since actual results may vary materially from them.Important assumptions made by us when making forward-looking statements include,among o

37、ther things,assumptions by us that:we are able to attract and retain key management and skilled personnel;third parties provide their services to us on a timely and effective basis;we are able to take advantage of new business opportunities in the pharmaceutical industry;we are able to secure and de

38、fend our intellectual property rights,and to avoid infringing upon the intellectual property rights of third parties;there are no material adverse changes in relevant laws or regulations;andwe are able to obtain the additional capital and financing we require when we need it.In addition,the forward-

39、looking statements in this annual report are subject to a number of known and unknown risks,uncertainties and other factors many of which are beyond our control,that could cause our actual results and developments to differ materially from those that are disclosed in or implied by the forward-lookin

40、g statements,including,among others:We may not achieve our publicly announced milestones on time,or at all.We are heavily dependent on the success of our lead drug candidate,GTX-104.We may not be able to maximize value from our de-prioritized drug candidates,GTX-102 and GTX-101,through either develo

41、pment,out-licensing or sale.We may not be able to maintain our operations and advance our research and development and commercialization of our lead drug candidates GTX-104,without additional funding.Business disruptions could seriously harm our future revenue and financial condition and increase ou

42、r costs and expenses.We may be subject to foreign exchange rate fluctuations.If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business,our stock price and trading volume could decline.Our future success depends on our ability to retai

43、n key executives and to attract,retain and motivate qualified personnel.We may face future product liability,and if claims are brought against us,we may incur substantial liability.We rely significantly on information technology and any failure,inadequacy,interruption or security lapse of that techn

44、ology,including any cybersecurity incidents,could harm our ability to operate our business effectively.Even if our drug candidates receive regulatory approval in the United States,we may never obtain regulatory approval or successfully commercialize our products outside of the United States.We are s

45、ubject to uncertainty relating to healthcare reform measures and reimbursement policies which,if not favorable to our drug candidates,could hinder or prevent our drug candidates commercial success.Our commercial success depends upon attaining significant market acceptance of our drug products and dr

46、ug candidates,if approved,among physicians,nurses,pharmacists,patients and the medical community.Guidelines and recommendations published by government agencies can reduce the use of our drug candidates and negatively impact our ability to gain market acceptance and market share.If we are unable to

47、establish sales and marketing capabilities or enter into agreements with third parties to market and sell our drug products,if approved,we may be unable to generate any revenue.If we obtain approval to commercialize any approved drug products outside of the United States,a variety of risks associate

48、d with international operations could materially adversely affect our business.If we are unable to differentiate our drug products from branded reference drugs or existing generic therapies for similar treatments,or if the FDA or other applicable regulatory authorities approve products that compete

49、with any of our drug products,our ability to successfully commercialize our drug products would be adversely affected.We face significant competition from other biotechnology and pharmaceutical companies,and our operating results will suffer if we fail to compete effectively.We could incur substanti

50、al costs and disruption to our business and delays in the launch of our drug products if our competitors and/or collaborators bring legal actions against us,which could harm our business and operating results.The COVID-19 pandemic,or a similar pandemic,epidemic,or outbreak of an infectious disease,m

51、ay materially and adversely affect our business and our financial results and could cause a disruption to the development of our drug candidates.We are subject to numerous complex regulatory requirements and failure to comply with these regulations,or the cost of compliance with these regulations,ma

52、y harm our business.If the FDA does not conclude that our drug candidates satisfy the requirements for the 505(b)(2)regulatory approval pathway,or if the requirements for approval of any of our drug candidates under Section 505(b)(2)are not as we expect,the approval pathway for our drug candidates w

53、ill likely take longer,cost more and we could encounter significantly greater complications and risks than anticipated,and in any case may not be successful.Clinical development is a lengthy and expensive process with an uncertain outcome,and results of earlier studies and trials may not be predicti

54、ve of future trial results.Failure can occur at any stage of clinical development.Delays in clinical trials are common and have many causes,and any delay could result in increased costs to us and could jeopardize or delay our ability to obtain regulatory approval and commence product sales.We may al

55、so find it difficult to enroll patients in our clinical trials,which could delay or prevent development of our drug candidates.Our drug products or drug candidates may cause adverse effects or have other properties that could delay or prevent their regulatory approval or limit the scope of any appro

56、ved label or market acceptance,or result in significant negative consequences following marketing approval,if any.The regulatory approval processes of the FDA and comparable foreign authorities are lengthy,time consuming and inherently unpredictable.An NDA submitted under Section 505(b)(2)subjects u

57、s to the risk of a patent infringement lawsuit that could delay or prevent the review or approval of our drug candidate.The FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses.Our drug development strategy relies heavily upon the 50

58、5(b)(2)regulatory pathway,which requires us to certify that we do not infringe upon third-party patents covering approved drugs.Such certifications often result in third-party claims of intellectual property infringement,the defense of which can be costly and time consuming,and an unfavorable outcom

59、e in any such litigation may prevent or delay our development and commercialization efforts,which would harm our business.Our business is subject to extensive regulatory requirements and our drug candidates that obtain regulatory approval will be subject to ongoing and continued regulatory review,wh

60、ich may result in significant expense and limit our ability to commercialize such products.Our employees,independent contractors,principal investigators,consultants,commercial partners and vendors may engage in misconduct or other improper activities,including non-compliance with regulatory standard

61、s and requirements.Any relationships with healthcare professionals,principal investigators,consultants,customers(actual and potential)and third-party payors are and will continue to be subject,directly or indirectly,to federal and state healthcare fraud and abuse laws,false claims laws,marketing exp

62、enditure tracking and disclosure,or sunshine laws,government price reporting and health information privacy and security laws.If we are unable to comply,or have not fully complied,with such laws,we could face penalties,including,without limitation,civil,criminal,and administrative penalties,damages,

63、monetary fines,disgorgement,possible exclusion from participation in Medicare,Medicaid and other federal healthcare programs,contractual damages,reputational harm,diminished profits and future earnings and curtailment or restructuring of our operations.We are required to obtain regulatory approval f

64、or each of our drug candidates in each jurisdiction in which we intend to market such drug products,and the inability to obtain such approvals would limit our ability to realize their full market potential.If we are sued for infringing intellectual property rights of third parties,it will be costly

65、and time consuming,and an unfavorable outcome in that litigation would have a material adverse effect on our business.We may be subject to claims that our employees,consultants,or independent contractors have wrongfully used or disclosed confidential information of third parties.Our success depends

66、in part upon our ability to protect our intellectual property for our drug candidates.If we fail to comply with our obligations in the agreements under which we license rights to technology from third parties,or if the license agreements are terminated for other reasons,we could lose license rights

67、that are important to our business.We may be subject to claims challenging our inventorship or ownership of our patents and other intellectual property.Intellectual property rights do not necessarily address all potential threats to our competitive advantage.Changes in patent law could diminish the

68、value of patents in general,thereby impairing our ability to protect any of our other future drug products and drug candidates.We may not be able to protect our intellectual property rights throughout the world.If our estimates or judgments relating to our critical accounting policies for intangible

69、 assets prove to be incorrect,impairment charges could result.We do not have internal manufacturing capabilities,and if we fail to develop and maintain supply relationships with various third-party manufacturers,we may be unable to develop or commercialize our drug candidates.Our contract manufactur

70、ers may encounter manufacturing failures that could delay the clinical development or regulatory approval of our drug candidates,or their commercial production,if approved.We rely on third parties to conduct our pre-clinical studies and clinical trials.If these third parties do not successfully carr

71、y out their contractual duties or meet expected deadlines,we may not be able to obtain regulatory approval for or commercialize our drug candidates and our business could be substantially harmed.We rely on third parties to manufacture commercial and clinical supplies of our drug candidates,and we in

72、tend to rely on third parties to manufacture commercial supplies of any approved drug products.The commercialization of any of our drug products could be stopped,delayed,or made less profitable if those third parties fail to provide us with sufficient quantities of active pharmaceutical ingredients,

73、excipients,or drug products,or fail to do so at acceptable quality levels or prices or fail to maintain or achieve satisfactory regulatory compliance.The design,development,manufacture,supply,and distribution of our drug candidates are highly regulated and technically complex.We may not be successfu

74、l in establishing development and commercialization collaborations which could adversely affect,and potentially prevent,our ability to develop our drug candidates.We may not be successful in maintaining development and commercialization collaborations,and any partner may not devote sufficient resour

75、ces to the development or commercialization of our drug candidates or may otherwise fail in development or commercialization efforts,which could adversely affect our ability to develop our drug candidates and our financial condition and operating results.There is a significant risk that we may be cl

76、assified as a PFIC for U.S.federal income tax purposes.We may not be able to use our net operating loss carry forwards to offset future taxable income for Canadian or U.S.federal income tax purposes.The Internal Revenue Service(“IRS”)may not agree that we should be treated as a foreign corporation f

77、or U.S.federal tax purposes.We do not expect to pay any cash dividends for the foreseeable future.The price of our common shares may be volatile.Raising additional capital in the future may cause dilution to our existing shareholders,restrict our operations or require us to relinquish rights to our

78、technologies or drug candidates.The market price of our common shares could decline if our operating results fall below the expectations of investors or fluctuate.There can be no assurance that an active market for our common shares will be sustained.If we fail to meet applicable listing requirement

79、s,the Nasdaq Stock Market may delist our common shares from trading,in which case the liquidity and market price of our common shares could decline.We may pursue opportunities or transactions that adversely affect our business and financial condition.We are a“smaller reporting company”under the U.S.

80、Securities and Exchange Commissions(“SECs”)disclosure rules and have elected to comply with the reduced disclosure requirements applicable to smaller reporting companies.As a non-accelerated filer,we are not required to comply with the auditor attestation requirements of the Sarbanes-Oxley Act.We ar

81、e a Qubec incorporated company headquartered in Canada,and U.S.investors may be unable to enforce certain judgments against us.All of the forward-looking statements in this annual report are qualified by this cautionary statement.There can be no guarantee that the results or developments that we ant

82、icipate will be realized or,even if substantially realized,that they will have the consequences or effects on our business,financial condition,or results of operations that we anticipate.As a result,you should not place undue reliance on the forward-looking statements.Except as required by applicabl

83、e law,we do not undertake to update or amend any forward-looking statements,whether as a result of new information,future events or otherwise.All forward-looking statements are made as of the date of this annual report.We express all amounts in this annual report in U.S.dollars,except where otherwis

84、e indicated.References to“$”and“U.S.$”are to U.S.dollars and references to“C$”or“CAD$”are to Canadian dollars.Except as otherwise indicated,references in this annual report to“Acasti,”“the Corporation,”“we,”“us”and“our”refer to Acasti Pharma Inc.and its consolidated subsidiaries.PART IItem 1.Busines

85、sOverviewWe are focused on developing and commercializing products for rare and orphan diseases that have the potential to improve clinical outcomes by using our novel drug delivery technologies.We seek to apply new proprietary formulations to approved and marketed pharmaceutical compounds to achiev

86、e enhanced efficacy,faster onset of action,reduced side effects,more convenient drug delivery and increased patient compliance;all of which could result in improved patient outcomes.The active pharmaceutical ingredients used in the drug candidates under development by Acasti may be already approved

87、in a target indication or could be repurposed for use in new indications.The existing well understood efficacy and safety profiles of these marketed compounds provides the opportunity for us to utilize the Section 505(b)(2)regulatory pathway under the Federal Food,Drug and Cosmetic Act for the devel

88、opment of our reformulated versions of these drugs,and therefore may provide a potentially shorter path to regulatory approval.Under Section 505(b)(2),if sufficient support of a products safety and efficacy either through previous FDA experience or sufficiently within the scientific literature can b

89、e established,it may eliminate the need to conduct some of the pre-clinical and clinical studies that new drug candidates might otherwise require.Our therapeutic pipeline consists of three unique clinical stage and multiple pre-clinical stage assets supported by an intellectual property portfolio of

90、 more than 40 granted and pending patents in various jurisdictions worldwide.These drug candidates aim to improve clinical outcomes in the treatment of rare and orphan diseases by applying proprietary formulation and drug delivery technologies to existing pharmaceutical compounds to achieve improvem

91、ents over the current standard of care,or to provide treatment for diseases with no currently approved therapies.We believe that rare disorders represent an attractive area for drug development,and there remains an opportunity for Acasti to utilize already approved drugs that have established safety

92、 profiles and clinical experience to potentially address significant unmet medical needs.A key advantage of pursuing therapies for rare disorders is the potential to receive orphan drug designation(“ODD”)from the FDA.Acastis three drug candidates currently in clinical development have received ODD s

93、tatus,provided certain conditions are met at NDA approval.ODD provides for seven years of marketing exclusivity in the United States post-launch,provided certain conditions are met,and the potential for faster regulatory review.ODD status can also result in tax credits of up to 50%of clinical develo

94、pment costs conducted in the United States upon market approval and a waiver of the NDA fees,which we estimate can translate into savings of approximately$3.0 million.Developing drugs for rare diseases can often allow for clinical trials that are more manageably scaled and may require a smaller,more

95、 targeted commercial infrastructure.The specific diseases targeted for drug development by Acasti are well understood although these patient populations may remain poorly served by available therapies or in some cases approved therapies do not yet exist.We aim to effectively treat debilitating sympt

96、oms that result from these underlying diseases.Our lead drug candidate:GTX-104,is an IV formulation of nimodipine designed to treat Subarachnoid Hemorrhage(“SAH”),a rare brain disorder for which we have completed multiple pharmacokinetic(“PK”)studies,including a successful PK bridging study recently

97、 completed in May 2022.SAH is a central nervous system condition that causes acute bleeding on the surface of the brain as the result of a ruptured aneurysm and requires immediate medical attention to prevent long-term disability or death.GTX-104 could be administered to improve the management of hy

98、potension and reduce the incidence of vasospasm in SAH patients and potentially lead to better patient outcomes.Other drug candidates:GTX-102,an oral-mucosal betamethasone spray for the treatment of Ataxia Telangiectasia(“A-T”),a complex orphan pediatric genetic neurodegenerative disorder usually di

99、agnosed in young children,for which no FDA approved treatment currently exists.GTX-101,a topical bioadhesive film-forming bupivacaine spray for Postherpetic Neuralgia(“PHN”),which can be persistent and often causes debilitating pain following infection by the shingles virus.We believe that GTX-101 c

100、ould be administered to patients with PHN to treat pain associated with the disease.In April 2023,we announced the strategic decision to prioritize development of GTX-104 with a goal to advance to commercialization,while conserving resources as much as possible to complete development efficiently.We

101、 estimate that the deferral of GTX-102 and GTX-101 could be 3 years given the timeline to complete the development and commercial launch of GTX 104.Further development of GTX-102 and GTX-101 will occur at such time as we obtain additional funding or enter into strategic partnerships for license or s

102、ale with third parties.The decision to defer further development has triggered a comprehensive impairment review of our intangible assets in March 2023.Given the extended timeline,we increased the discount rates used to value the assets in order to recognize additional risks related to prioritizing

103、one asset over the others,financing the projects given limited available resources and the need to preserve cash to advance GTX 104 as far as possible,potential competitor advances that could arise over three years,and the general market depression affecting small cap development companies like us a

104、nd the prohibitively high dilution and expense of available funding in the capital markets.Increasing the discount rates significantly reduced the discounted cash flow values for each of the programs deferred.Accordingly,in the quarter ended March 31,2023 we booked impairment charges related to GTX

105、102 and GTX 101 of$22.7M and$6.0M respectively,together with further adjustments made to deferred taxes and goodwill directly related to those assets.The impairment charge overall amounts to$33.5M.Management continues to believe that GTX 102 and GTX 101 will eventually provide significant value for

106、the Company when development resumes and they are launched successfully.Our management team possesses significant experience in drug formulation and drug delivery research and development,clinical and pharmaceutical development and manufacturing,regulatory affairs,and business development,as well as

107、 being well-versed in late-stage drug development and commercialization.Importantly,our team is comprised of industry professionals with deep expertise and knowledge,including a world-renowned practicing neurosurgeon-scientist and respected authority in SAH,as well as product development,chemistry,m

108、anufacturing and controls(“CMC”),planning,implementation,management,and execution of global Phase 2 and Phase 3 trials for a drug candidate for SAH.GTX-104 Overview Nimodipine was granted FDA approval in 1988,and is the only approved drug that has been clinically shown to improve neurological outcom

109、es in SAH patients.It is only available in the United States as a generic oral capsule and as a branded oral liquid solution called NYMALIZE,which is manufactured and sold by Arbor 7 Pharmaceuticals(acquired in September 2021 by Azurity Pharmaceuticals).Nimodipine has poor water solubility and high

110、permeability characteristics as a result of its high lipophilicity.Additionally,orally administered nimodipine has dose-limiting side-effects such as hypotension,poor absorption and low bioavailability resulting from high first-pass metabolism,and a narrow administration window as food effects lower

111、 bioavailability significantly.Due to these issues,blood levels of orally administered nimodipine can be highly variable,making it difficult to manage blood pressure in SAH patients.Nimodipine capsules are also difficult to administer,particularly to unconscious patients or those with impaired abili

112、ty to swallow.Concomitant use with CYP3A inhibitors is contraindicated(NIMODIPINE Capsule PI).NIMOTOP is an injectable form of nimodipine that is manufactured by Bayer Healthcare.It is approved in Europe and in other regulated markets(but not in the United States).It has limited utility for SAH pati

113、ents because of its high organic solvent content,namely 23.7%ethanol and 17%polyethylene glycol 400(NIMOTOP SmPC).GTX-104 is a clinical stage,novel formulation of nimodipine for IV infusion in SAH patients.It uses surfactant micelles as the drug carrier to solubilize nimodipine.This unique nimodipin

114、e injectable formulation is composed of a nimodipine base,an effective amount of polysorbate 80,a non-ionic hydrophilic surfactant,and a pharmaceutically acceptable carrier for injection.GTX-104 is supplied as an aqueous concentrate that upon dilution with saline,dextrose or lactated ringer,is a rea

115、dy-to-use infusion solution,which is stable and clear.Key potential benefits of GTX-104 include:Novel nanoparticle technology facilitates aqueous formulation of insoluble nimodipine for a safe,standard peripheral IV infusion:Potential for better control of blood pressure and improved management of h

116、ypotension100%bioavailabilityEliminates food effects that impact the absorption of oral form of nimodipine Lower inter and intra-subject variability as compared to oral nimodipine GTX-104 could provide a more convenient mode of administration as compared to generic nimodipine capsules or NYMALIZE GT

117、X-104 is administered as an initial bolus followed by a continuous infusion as compared to oral administration via a nasogastric tube in unconscious patients every two to four hours for both nimodipine capsules and NYMALIZE solution.Therefore,GTX-104 could make a major contribution to patient care b

118、y potentially reducing the dosing frequency,and the associated nursing burden.More convenient continuous,and consistent dosing can also reduce the risk of medication errors.In addition,as depicted in the charts below,two PK studies have shown that GTX-104 has the potential to provide improved bioava

119、ilability and lower intra-subject variability compared to oral administration.Because of its IV formulation,we also expect GTX-104 to reduce certain drug-drug interactions and food effects.8 Despite the positive impact it has on recovery,physicians often must discontinue their patients from oral nim

120、odipine,primarily as a result of hypotensive episodes that cannot be controlled by titrating the oral form of drug.Such discontinuation could potentially be avoided by administering GTX-104,which because of its IV administration,may reduce the complexity associated with the need for careful attentio

121、n to the timing of nimodipine administration at least one hour before or two hours after a meal.Administration of GTX-104 via a peripheral vein is often much more comfortable for the patients compared to administration by central venous access(as is the case for NIMOTOPTM),which can often be a diffi

122、cult,invasive and more risky procedure.Also,unconscious patients will likely receive more consistent concentrations of nimodipine when delivered via the IV route as compared to oral gavage or a nasogastric tube.More consistent dosing is expected to result in a reduction of vasospasm and a better,mor

123、e consistent management of hypotension.As summarized in the table below,we also anticipate reduced use of rescue therapies,such as vasopressors,and expensive hospital resources,such as the angiography suite,are possible by more effectively managing blood pressure with GTX-104.Reduced incidences of v

124、asospasm could result in shorter length of stay and better outcomes.About Subarachnoid Hemorrhage(SAH)SAH is bleeding over the surface of the brain in the subarachnoid space between the brain and the skull,which contains blood vessels that supply the brain.A primary cause of such bleeding is rupture

125、 of an aneurysm.The result is a relatively uncommon type of stroke that accounts for about 5%of all strokes and has an incidence of six per 100,000 person years(Becske,2018).In contrast to more common types of stroke in elderly individuals,SAH often occurs at a relatively young age,with approximatel

126、y half the affected patients younger than 60 years old(Becske,2018).Approximately 10%to 15%of aneurysmal SAH(“aSAH”)patients die before reaching the hospital(Rinkel,2016),and those who survive the initial hours post hemorrhage are admitted or transferred to tertiary care centers with high risk of co

127、mplications,including rebleeding and delayed cerebral ischemia(“DCI”).Systemic manifestations affecting cardiovascular,pulmonary,and renal function are common and often complicate management of DCI.Approximately 70%of aSAH patients experience death or a permanent dependence on family members,and hal

128、f die within one month after the hemorrhage.Of those who survive the initial month,half remain permanently dependent on a caregiver to maintain daily living(Becske,2018).We estimate that approximately 50,000 individuals experience aSAH each year in the US based on third-party market research,and tha

129、t total addressable market for SAH is approximately$300 million in the U.S.There are an estimated 150,000 aSAH patients each year in China and approximately 55,000 patients in the European Union based on annual inpatient admissions and the average length-of-stay.GTX-104 Recent Activities&Near Term M

130、ilestones:Conduct Phase 3 Safety Study In September 2021,we initiated our pivotal PK bridging trial to evaluate the relative bioavailability of GTX-104 compared to currently marketed oral nimodipine capsules in approximately 50 healthy subjects.The PK trial was the next required step in our proposed

131、 505(b)(2)regulatory pathway for GTX-104.Final results from this pivotal PK trial were reported on May 18,2022,and showed that the bioavailability of GTX-104 compared favorably with the oral formulation of nimodipine in all subjects,and no serious adverse events were observed for GTX-104.All three e

132、ndpoints indicated that statistically there was no difference in exposures between GTX-104 and oral nimodipine over the defined time periods for both maximum exposure and total exposure.Plasma concentrations obtained following IV administration showed significantly less variability between subjects

133、as compared to oral administration of capsules,since IV administration is not as sensitive to some of the physiological processes that affect oral administration,such as taking the drug with and without meals,variable gastrointestinal transit time,variable drug uptake from the gastrointestinal tract

134、 into the systemic circulation,and variable hepatic blood flow and hepatic first pass metabolism.Previous studies have shown these processes significantly affect the oral bioavailability of nimodipine,and therefore cause oral administration to be prone to larger inter-and intra-subject variability.9

135、 The bioavailability of oral nimodipine capsules observed was only 8%compared to 100%for GTX-104.Consequently,about one-twelfth the amount of nimodipine is delivered with GTX-104 to achieve the same blood levels as with the oral capsules.No serious adverse events and no adverse events leading to wit

136、hdrawal were reported during the trial.Next Steps Initiate Phase 3 Safety trial for GTX-104 In April 2023,we received a Type C written meeting response and clarifying feedback from the FDA on our proposed Phase 3 safety trial for GTX-104.The FDA provided additional comments on our development plan t

137、hat,pending submission of the final clinical protocol and FDA approval of same,will allow us to proceed with the initiation of a Phase 3 safety clinical trial in aSAH patients.The FDA concurred with the suitability of the 505(b)(2)regulatory pathway with the selected Reference Listed Drug NIMOTOP or

138、al capsules(NDA 018869),and that our GTX-104-002 PK trial may have met the criteria for a scientific bridge.Based on the FDAs proposed Phase 3 trial design,we will target enrollment of aSAH patients(across all grades of severity)in a 1:1 randomized trial with oral nimodipine,to be conducted in an es

139、timated 25-30 sites in the U.S.The FDA confirmed the use of the Hunt and Hess scale to stratify patients based on severity.The primary endpoint is safety,and it will be measured as the percentage of significant adverse events of hypotension related to study drugs in both arms.We expect the first pat

140、ient to be enrolled during the second half of 2023.The trial is expected to take approximately18 months to complete from the time the first patient is enrolled,and we expect this safety trial to be the final clinical step required to seek approval under the 505(b)(2)regulatory pathway.Before submitt

141、ing a NDA,we plan to hold a pre-NDA meeting with the FDA to enhance the likelihood of market approval.GTX-102 Overview GTX-102 is a novel,concentrated oral-mucosal spray of betamethasone intended to improve neurological symptoms of Ataxia Telangiectasia(“A-T”)for which there are currently no FDA-app

142、roved therapies.GTX-102 is a stable,concentrated oral spray formulation comprised of the gluco-corticosteroid betamethasone that together with other excipients can be sprayed conveniently over the tongue of the A-T patient and is rapidly absorbed.About Ataxia Telangiectasia A-T is a rare genetic pro

143、gressive autosomal recessive neurodegenerative disorder that affects children,with the hallmark symptoms of cerebellar ataxia and other motor dysfunction,and dilated blood vessels(telangiectasia)that occur in the sclera of the eyes.A-T is caused by mutations in the ataxia telangiectasia gene,which i

144、s responsible for modulating cellular response to stress,including breaks in the double strands of DNA.Children with A-T begin to experience balance and coordination problems when they begin to walk(toddler age),and ultimately become wheelchair-bound in their second decade of life.In pre-adolescence

145、(between ages 5 and 8),patients experience oculomotor apraxia,dysarthria,and dysphagia.They also often develop compromised immune systems and are at increased risk of developing respiratory tract infections and cancer(typically lymphomas and leukemia)(U.S.National Cancer Institute A-T,2015).A-T is d

146、iagnosed through a combination of clinical assessment(especially neurologic and oculomotor deficits),laboratory analysis,and genetic testing.There is no known treatment to slow disease progression,and treatments that are used are strictly aimed at controlling the symptoms(e.g.,physical,occupational

147、or speech therapy for neurologic issues),or conditions secondary to the disease(e.g.,antibiotics for lung infections,chemotherapy for cancer,etc.)(U.S.National Cancer Institute A-T,2015).There are no FDA-approved therapeutic options currently available.Patients typically die by age 25 from complicat

148、ions of lung disease or cancer.According to a third-party report we commissioned,A-T affects approximately 4,300 patients per year in the United States and has a potential total addressable market of$150 million,based on the number of treatable patients in the United States.GTX-102-R&D and Clinical

149、Studies to Date We have licensed the data from the multicenter,double-blinded,randomized,placebo-controlled crossover trial from Azienda Ospedaliera Universitaria Senese,Siena,Italy,where Dr.Zannolli et.al.studied the effect of oral liquid solution of betamethasone to reduce ataxia symptoms in patie

150、nts with A-T.This oral liquid solution is not marketed in the United States,and therefore is not available for clinical use;currently,betamethasone is only available in the United States as an injectable or as a 10 topical cream.This license gives us the right to reference the studys data in its NDA

151、 filing.On November 12,2015,we submitted the data from the Zannolli study to the FDAs Division of Neurology at a pre-Investigational New Drug(“IND”)meeting and received guidance from the agency on the regulatory requirements to seek approval.In a multicenter,double-blind,randomized,placebo-controlle

152、d crossover trial conducted in Italy,Dr.Zannolli et al.studied the effect of an oral liquid solution of betamethasone on the reduction of ataxia symptoms in 13 children(between ages 2 to 8 years)with A-T.The primary outcome measure was the reduction in ataxia symptoms as assessed by the Internationa

153、l Cooperative Ataxia Rating Scale(“ICARS”).In the trial,oral liquid betamethasone reduced the ICARS total score by a median of 13 points in the intent-to-treat population and 16 points in the per-protocol population(the median percent decreases of ataxia symptoms of 28%and 31%,respectively).Adverse

154、events in the trial were minimal,with no compulsory withdrawals and only minor side effects that did not require medical intervention.Clinical trial results in A-T patients administered oral betamethasone indicated that betamethasone significantly reduced ICARS total score relative to placebo(P=0.01

155、).The median ICARS change score(change in score with betamethasone minus change in score with placebo)was-13 points(95%confidence interval for the difference in medians was-19 to-5.5 points).Based on the Zannolli data,we believe that our GTX-102 concentrated oral spray has the potential to provide c

156、linical benefits in decreasing A-T symptoms,including assessments of posture and gait disturbance and kinetic,speech and oculomotor functions.In addition,GTX-102 may ease drug administration for patients experiencing A-T given its application of 1-3x/day of 140L of concentrated betamethasone liquid

157、sprayed onto the tongue using a more convenient metered dose delivery system,as these A-T patients typically have difficulty swallowing(lefton-greif 2000).GTX-102 PK Data to Date:GTX-102 administered as a concentrated oral spray achieves similar blood levels at only 1/70th the volume of an oral solu

158、tion of betamethasone.This more convenient mode of administration will be important for A-T patients who have difficulties swallowing large volumes of liquids.GTX-102 Recent Activities:11 We initiated a PK bridging trial of GTX-102 as compared to the oral liquid solution of betamethasone used in the

159、 Zannolli study and against the injectable form of betamethasone that is approved in the U.S.in the third calendar quarter of 2022.The primary objectives of the PK bridging trial were to evaluate the bioavailability,pharmacokinetics and safety of GTX-102.On December 28,2022,we reported that the topl

160、ine results of this trial met all primary outcome measures.Results showed that GTX-102 betamethasone blood concentrations were highly predictable and consistent based on AUC(the area under the concentration time curve up to 72 hours post-dose,extrapolated to infinity)and Cmax(the maximum concentrati

161、on occurring between 0 hour to 72 hours after study drug administration),indicating good linearity and dose-proportionality.GTX-102 betamethasone blood concentrations were within the same range of exposure as IM betamethasone,based on AUC.This IM formulation will serve as a bridge for GTX-102 in the

162、 context of the proposed 505(b)(2)regulatory pathway.GTX-102 betamethasone blood concentrations were also within the same range of exposure as Oral Solution(OS),based on AUC.This OS formulation was used by Zannolli and may serve as a clinical comparator for further clinical development.Furthermore,s

163、tatistically there was no significant difference(p0.05)between GTX-102 administered at a fast rate(each spray immediately following the preceding one)vs.a slow rate(1 spray/minute),as indicated by Cmax and AUC.We believe this result is important because being able to use the fast or the slow rate of

164、 administration may provide greater flexibility for patients and caregivers.The Cmax of GTX-102 was within the same range of exposure as the OS,but the Cmax for the IM formulation was lower than both GTX-102 and the OS,as well as what has been reported previously for the IM in industry publications.

165、It is important to note that achieving bioequivalence with the IM was not an objective of this trial,nor was it expected.Finally,of the 48 healthy adult subjects,no serious adverse events(AE)were reported,and the most frequent drug-related adverse effect was mild headache(4 cases).The further develo

166、pment of GTX-102 has been deprioritized in favor of our focus on development of GTX-104.Pending additional dedicated funding for GTX-102 or the signing of a strategic partnership,We will work with our clinical experts and the FDA to determine the best final dosing regimen for GTX-102 to incorporate

167、into our Phase 3 trial design.Based on previous discussions with the FDA,we plan to conduct a confirmatory Phase 3 safety and efficacy trial in A-T patients,and plan to seek guidance from the FDA on the trial design at a Type B meeting.It is also possible that we may out-license or sell our GTX-102

168、drug candidate.GTX-101 Overview GTX-101 is a non-narcotic,topical bio-adhesive film-forming bupivacaine spray designed to ease the symptoms of patients suffering with postherpetic neuralgia(“PHN”).GTX-101 is administered via a metered-dose of bupivacaine spray and forms a thin bio-adhesive topical f

169、ilm on the surface of the patients skin,which enables a touch-free,non-greasy application.It also comes in convenient,portable 30 ml plastic bottles.Unlike oral gabapentin and lidocaine patches,we believe that the biphasic delivery mechanism of GTX-101 has the potential for rapid onset of action and

170、 continuous pain relief for up to eight hours.No skin sensitivity was reported in a Phase 1 trial.About Postherpetic Neuralgia(PHN)PHN is neuropathic pain due to damage caused by the varicella zoster virus(“VZV”).Infection with VZV causes two distinct clinical conditions.Primary VZV infection causes

171、 varicella(i.e.,chickenpox),a contagious rash illness that typically occurs among young children.Secondary VZV can reactivate clinically,decades after initial infection,to cause herpes zoster(“HZ”),otherwise known as shingles.Acute HZ arises when dormant virus particles,persisting within an affected

172、 sensory ganglion from the earlier,primary infection with VZV become reactivated when cellular immunity to varicella decreases.Viral particles replicate and may spread to the dorsal root,into the dorsal horn of the spinal cord,and through peripheral sensory nerve fibers down to the level of the skin

173、.Viral particles also may circulate in the blood.This reactivation is accompanied by inflammation of the skin,immune response,hemorrhage,and destruction of peripheral and central neurons and their fibers.Following such neural degeneration,distinct types of pathophysiological mechanisms involving bot

174、h the central and peripheral nervous systems may give rise to the severe nerve pain associated with PHN.While the rash associated with HZ typically heals within two to four weeks,the pain may persist for months or even years,and this PHN manifestation is the most common and debilitating complication

175、 of HZ.There is currently no consensus definition for PHN,but it has been suggested by the Centers for Disease Control and Prevention(“CDC”)that PHN is best defined as pain lasting at least three months after resolution of the rash.12 PHN is associated with significant loss of function and reduced q

176、uality of life,particularly in the elderly.It has a detrimental effect on all aspects of a patients quality of life.The nature of PHN pain varies from mild to severe,constant,intermittent,or triggered by trivial stimuli.Approximately half of patients with PHN describe their pain as“horrible”or“excru

177、ciating,”ranging in duration from a few minutes to constant on a daily or almost daily basis(Katz,2004).The pain can disrupt sleep,mood,work,and activities of daily living,adversely impacting the quality of life and leading to social withdrawal and depression.PHN is the number-one cause of intractab

178、le,debilitating pain in the elderly,and has been cited as the leading cause of suicide in chronic pain patients over the age of 70(Hess,1990).Current treatment of PHN most often consists of oral gabapentin(first line)and prescription lidocaine patches or antidepressants(second line),and refractory c

179、ases may be prescribed opioids to address persistent pain.Gabapentin and opioid abuse have continued to proliferate,and lidocaine patches are suboptimal for many reasons.An independent third-party market research firm we commissioned interviewed more than 250 physicians who regularly treat PHN patie

180、nts,and found that approximately 40%of patients using lidocaine patches experience insufficient pain relief.Lidocaine patches are difficult to use,fall off,and look unsightly with possible skin sensitivity and irritation.Additionally,lidocaine patches can only be used for 12 hours on and then need t

181、o be removed for 12 hours before being reapplied.Prescription lidocaine patches are only approved for PHN,and the market is currently made up of both branded and generic offerings.It is estimated that PHN affects approximately 120,000 patients per year in the United States.According to a third-party

182、 report we commissioned,the total addressable market for GTX-101 could be as large as$2.5 billion,consisting of approximately$200 million for PHN pain and$2.3 billion for non-PHN pain indications.GTX-101 R&D History and Clinical Studies Completed to Date To date,we have conducted four Phase I trials

183、 in healthy volunteers to assess the PK,safety and tolerability of GTX-101 and to determine the plasma levels of bupivacaine HCl administered as a single dose in various concentrations between 30 mg(three sprays)and 2100 mg(twenty sprays).These studies confirmed that bupivacaine delivered as a topic

184、al spray(GTX-101)is well absorbed through the skin,as demonstrated in the graph below,while very little is absorbed systemically.In all four studies,the administration of GTX-101 to healthy volunteers was safe and well tolerated.In addition,no evidence of skin irritation was observed at the applicat

185、ion site following the spray administrations.The data below is from two separate trials of GTX-101 and the Lidoderm patch superimposed on each other.GTX-101 recent activities:We believe that the PHN pain market will continue to grow,and non-opioid products like GTX-101 that can relieve PHN pain more

186、 quickly and in a sustained manner by means of a more efficient delivery system,will be an attractive therapy option for patients and physicians.GTX-101 is administered by spraying our proprietary bupivacaine formulation over the affected area,which we believe has the potential to provide several ad

187、vantages over currently marketed products such as the lidocaine patch,including faster onset of action,sustained pain relief,possibly lower dosing requirements and improved dosing convenience,all which could lead to increased patient satisfaction and compliance.The data from the single dose Phase 1

188、clinical trial for GTX-101 was submitted to the FDAs Division of Anesthesiology and feedback was received at a pre-IND meeting on April 18,2018,that informed the design of pre-clinical toxicology studies and a clinical and regulatory pathway to approval under section 505(b)(2).We completed a minipig

189、 skin sensitivity study in the second calendar quarter of 2022,and we initiated a single dose PK trial in healthy human volunteers in July 2022.Topline results from this single dose PK trial were reported on December 23,2022 and the results met all primary outcome measures.The median Tmax(the time o

190、f maximum concentration between 0 hour and 240 hours after study drug administration)of bupivacaine in plasma following GTX-101 single-dose topical applications ranged between 18 to 24 hours depending on dose,while the median Tmax following the subcutaneous injection of 10 mg of bupivacaine was only

191、 23 minutes.This result suggests that bupivacaine delivered by GTX-101 remains in the skin for a long period of time,potentially inducing prolonged analgesic effect in the sprayed area.The exposure to bupivacaine based on Cmax(the maximum concentration occurring at Tmax between 0 hour and 240 hours

192、after study drug administration)and AUC(the area under the concentration time curve,extrapolated to infinity)following GTX-101 topical application as a single-dose increased with increasing dose.13 The systemic exposure to bupivacaine following a 200mg dose of GTX-101 was approximately 29-fold less

193、than a single subcutaneous dose of 10mg of bupivacaine based on Cmax and approximately 6-fold less than a single subcutaneous dose of 10mg of bupivacaine based on AUC.We predict these lower blood levels will correspond to an increased safety margin for GTX-101 with regards to toxicity risk.Mean half

194、-life(T half)following GTX-101 single-dose topical applications ranged between 24 to 37 hours depending on dose,suggesting a slow elimination and potentially long duration of effect,while mean Tmax following the subcutaneous injection of 10 mg of bupivacaine was only 8 hours.There were only two adve

195、rse events judged as related to the study drug by the investigator for each of GTX-101 and the bupivacaine subcutaneous injection.Following GTX-101 topical application:headache(1 event=3%)and numbness(1 event=3%)at the sprayed area following bupivacaine subcutaneous injection:dizziness(1 event=8%)an

196、d nausea(1 event=8%).The further development of GTX-101 has been deprioritized in favor of our focus on development of GTX-104.Pending additional dedicated funding for GTX-101 or the signing of a strategic partnership,we plan to follow this successful PK trial with a multiple ascending dose study in

197、 2023.Results from these non-clinical and clinical studies and trials are required before the initiation of our Phase 2 program in PHN patients.It is also possible that we may out-license or sell our GTX-101 drug candidate.Overall Commercialization Strategy We plan to retain our worldwide commercial

198、ization rights for some of our key drug candidates,while for other drug candidates we may consider collaboration opportunities to maximize market penetration and returns.If we receive regulatory approval,we may look to out license commercialization opportunities or consider outsourcing sales to ensu

199、re efficient commercial management.A similar review and approach will be applied to GTX-102.Given that GTX-101 will be targeted to a larger primary care and pain specialist market,if GTX-101 receives regulatory approval,we will likely seek commercial partnerships to fully exploit the market potentia

200、l of this drug product.As our product candidates advance through the pipeline,our commercial plans may change.Clinical data,the size of the development programs,the size of the target market,the size of a commercial infrastructure and manufacturing needs may all influence our U.S.,European Union,and

201、 rest-of-world strategies.Currently,we have prioritized the development of GTX-104 and de-emphasized the development of GTX-102 and GTX-101.It is possible that we may out-license or sell GTX-102 and/or GTX-101.14 Manufacturing and Supply We currently do not own any manufacturing facilities.The manuf

202、acture of our pipeline of drug candidates is highly reliant on complex techniques and personnel aseptic techniques,which present significant challenges and require specialized expertise.Further,these processes undergo a high level of scrutiny by regulatory agencies.Consequently,we utilize a network

203、of third-party CMOs for manufacturing of our drug candidates.All CMOs are monitored and evaluated by us to assess compliance with regulatory requirements.We work with independent consultants to perform periodic quality audits of our manufacturers to review the manufacturing process for our drug cand

204、idates and to provide input on quality issues.All lots of the drug substance and drug product used in clinical supply are manufactured under current good manufacturing practices.We plan to continue to rely upon CMOs to manufacture clinical and commercial quantities once the product is approved.We ha

205、ve development agreements in place with these CMOs and we have personnel with pharmaceutical development and manufacturing experience who are responsible for the relationships with our CMOs.Intellectual Property Portfolio We have a strong and multi-layered intellectual property protection strategy,w

206、hich we believe will create barriers to entry and solidify our position in the market.All of our leading pipeline products have received orphan status designation from the FDA,which could result in 7 years of marketing exclusivity in the United States and 10 years in Europe,provided they receive the

207、 final marketing authorizations from the applicable government agencies,and they can meet the conditions for receiving such marketing exclusivity.In addition,we protect our drug candidates through a well-defined patent filing strategy.Our patent estate includes more than 40 granted and pending paten

208、ts in various global jurisdictions,including 6 U.S.issued patents and 4 filed U.S.patent applications.We believe that our intellectual property portfolio,consisting primarily of composition and method-of-use patents,will protect the market value of our products by extending exclusivity beyond what i

209、s granted through the orphan designation.We intend to continue to build our patent portfolio by filing for patent protection on new developments with respect to our product candidates.We expect that these patents will,if and when issued,allow us to list our own patents in the Orange Book:Approved Dr

210、ug Products with Therapeutic Equivalence issued by the FDA,to which potential competitors will be required to certify upon submission of their applications referencing our drug products,if approved.We strive to protect and enhance the proprietary technology,inventions,and improvements that are comme

211、rcially important to the development of our business,including seeking,maintaining,and defending patent rights,whether developed internally or licensed from third parties.We also rely on trade secrets relating to manufacturing know-how,continuing technological innovation and in-licensing opportuniti

212、es to develop,strengthen,and maintain our proprietary position.We may also rely on regulatory protections afforded through orphan drug status,data exclusivity,market exclusivity,and patent term extensions,where available.We are actively seeking U.S.and international patent protection for a variety o

213、f technologies and intend to seek patent protection or rely upon trade secret rights to protect other technologies that may be used to discover and validate targets and that may be used to identify and develop novel pharmaceutical products.We seek these protections,in part,through confidentiality an

214、d proprietary information agreements.Individual patents extend for varying periods depending on the date of filing or the date of issuance,and the legal term of patents in the countries in which they are obtained.Generally,utility patents issued for applications filed in the United States are grante

215、d a term of 20 years from the earliest effective filing date of a non-provisional patent application.In addition,in certain instances,a patent term can be extended to recapture a portion of the U.S.Patent and Trademark Office delay in issuing the patent as well as a portion of the term effectively l

216、ost as a result of the FDA regulatory review period.However,as to the FDA component,the restoration period cannot be longer than 5 years and the total patent term including the restoration period must not exceed 14 years following FDA approval.The duration of foreign patents varies in accordance wit

217、h provisions of applicable local law,but typically is also 20 years from the earliest effective filing date.The actual protection afforded by a patent may vary on a product-by-product basis from country to country and can depend upon many factors,including the type of patent,the scope of its coverag

218、e,the availability of regulatory-related extensions,the availability of legal remedies in a particular country and the validity and enforceability of the patent.We have several issued U.S.patents and patent applications as well as patents and patent applications in other jurisdictions.Five patents f

219、or GTX-104 have been granted in the United States.One patent for GTX-101 has been granted in Europe,China,Mexico,Japan and South Africa.One patent for GTX-102 has been granted in Japan.Recent Developments Announcement of centralization of marketplace for shares on the Nasdaq with voluntary delisting

220、 from TSX Venture Exchange On March 13,2023,we announced that we had applied and received approval for a voluntary delisting of our common shares from the TSX Venture Exchange(TSXV).The delisting from the TSXV did not affect the Companys listing on the Nasdaq Capital Market(the Nasdaq).The common sh

221、ares continue to trade on the Nasdaq under the symbol ACST.Effective as at the close of trading on March 27,2023,Acastis common shares were no longer be listed and posted for trading on the TSXV.Announcement of resignation of a director On March 30,2023,we announced that effective immediately,Mr.Jea

222、n-Marie(John)Canan had tendered his resignation from the board of directors of the Company.Announcement of appointment of Prashant Kohli as CEO On April 4,2023,we announced the appointment of Prashant Kohli as Acastis new Chief Executive Officer,succeeding Jan DAlvise.The parties mutually agreed to

223、part ways,and Ms.DAlvise stepped down from the board of directors of the Company.Announcement of intention to proceed with Phase 3 clinical safety study for GTX-104 following FDA feedback On April 4,2023 we announced that we received a Type C written meeting response and clarifying feedback from the

224、 FDA on our proposed Phase 3 safety study for GTX-104.The FDA provided additional comments on our development plan that,subject to submission of the final clinical protocol and FDA approval of same,will allow us to proceed with the initiation of a Phase 3 safety clinical trial in aneurysmal aSAH pat

225、ients.Announcement of successful submission of pivotal GTX-104 Phase 3 safety study protocol with FDA and implementation of strategic realignment plan On May 8,2023,we announced the successful submission to the FDA of GTX-104s full protocol of its pivotal Phase 3 safety study and implementation of a

226、 strategic realignment plan to maximize shareholder value.The realignment follows a comprehensive strategic review of the Company by Prashant Kohli,its recently appointed CEO,and its board of directors.15 Key strategies being implemented are:Prioritizing resources to GTX-104.We submitted the full pi

227、votal Phase 3 safety study protocol for GTX-104 with the FDA with all supporting documentation.Pending final feedback and approval from the FDA,the first patient,first dose for the pivotal Phase 3 safety study is expected in calendar Q4 2023.Strategic transformation of our operating model to an agil

228、e biopharma reflecting its complete focus on GTX-104.In alignment with the operating model,Acasti has brought on a highly experienced new management team with deep subject matter knowledge and direct,hands-on clinical trial experience in aSAH.Significant extension of our cash runway expected to be s

229、ufficient to fund the Company through calendar Q2 2025,facilitating achievement of critical value inflection milestones,including a potential NDA filing for GTX-104.Evaluation of strategic alternatives to maximize value of de-prioritized pipeline assets,GTX-102 and GTX-101 In connection with the tra

230、nsformation of the operating model,we have moved to appoint the following industry experts to our senior management team:Dr.R.Loch Macdonald,MD,PhD,as Chief Medical Officer.A world-renowned practicing neurosurgeon-scientist and respected authority in SAH,Dr.Macdonald is the former founder of a clini

231、cal-stage biotechnology company focused on subarachnoid hemorrhage.Carrie DAndrea,as VP Clinical Operations.Ms.DAndrea is a highly experienced professional who has built and led the planning,implementation,management,and execution of global Phase 2 and Phase 3 trials for a drug candidate for subarac

232、hnoid hemorrhage.Amresh Kumar,PhD,as VP Program Management.Mr.Kumar is an experienced drug development,CMC,and program management expert.Amresh is the former product leader of GTX-104 while at Grace Therapeutics(which was acquired by us).As a result of this strategic realignment,we are,over time,dis

233、continuing our operations in Canada,and have proceeded to lay off substantially all our workforce,allowing our new management team to rebuild a leaner organization in the United States.All of our finance team will remain in their current role for a transition period until at least the end June 2023.

234、Corporate Structure Acasti was incorporated on February 1,2002 under Part 1A of the Companies Act(Qubec)under the name“9113-0310 Qubec Inc.”On February 14,2011,the Business Corporations Act(Qubec),or QBCA,came into effect and replaced the Companies Act(Qubec).We are now governed by the QBCA.On Augus

235、t 7,2008,pursuant to a Certificate of Amendment,we changed our name to“Acasti Pharma Inc.”,our share capital description,the provisions regarding the restriction on securities transfers and our borrowing powers.On November 7,2008,pursuant to a Certificate of Amendment,we changed the provisions regar

236、ding our borrowing powers.We became a reporting issuer in the Province of Qubec on November 17,2008.On December 18,2019,we incorporated a new wholly owned subsidiary named Acasti Innovation AG,or AIAG,under the laws of Switzerland for the purpose of future development of our intellectual property an

237、d for global distribution of our products.AIAG currently does not have any operations.On August 27,2021,Acasti completed its acquisition of Grace Therapeutics Inc.via a merger.Following completion of the merger,Grace became a wholly owned subsidiary of Acasti and was renamed Acasti Pharma U.S.Inc.Av

238、ailable Information This annual report on Form 10-K,our quarterly reports on Form 10-Q,our current reports on Form 8-K,and any amendments to these reports are filed,or will be filed,as applicable,with the SEC,and the Canadian Securities Administrators,or CSA.These reports are available free of charg

239、e on our website,as soon as reasonably practicable after we electronically file such reports with or furnish such reports to the SEC and the CSA.Information contained on,or accessible through,our website is not a part of this annual report,and the inclusion of our website address in this document is

240、 an inactive textual reference.Additionally,our filings with the SEC may be accessed through the SECs website at www.sec.gov and our filings with the CSA may be accessed through the CSAs System for Electronic Document Analysis and Retrieval at .Item 1A.Risk Factors Summary of Risk Factors We are pro

241、viding the following summary of the risk factors contained in this annual report to enhance the readability and accessibility of our risk factor disclosures.This summary does not address all of the risks that we face.We encourage you to carefully review the full risk factors contained in this annual

242、 report on Form 10-K in their entirety for additional information regarding the material factors that make an investment in our securities speculative or risky.The primary categories by which we classify risks include:(i)general risks related to our company;(ii)risks relating to our business;(iii)ri

243、sks relating to the development,testing and commercialization of our products;(iv)risks relating to our intellectual property;(v)risks relating to our dependence on third parties;and(vi)risks relating to ownership of our common shares.Set forth below within each of these categories is a summary of t

244、he principal factors that make an investment in our common shares speculative or risky.General Risks Related to the Company We may not achieve our publicly announced milestones on time,or at all.We are heavily dependent on the success of our lead drug candidate.We may not be able to maximize value f

245、rom our de-prioritized drug candidates,GTX-102 and GTX-101,through either development,out-licensing or sale.We may not be able to maintain our operations and advance our research and development and commercialization of our lead drug candidate,GTX-104 without additional funding.Business disruptions

246、could seriously harm our future revenue and financial condition and increase our costs and expenses.We may be subject to foreign exchange rate fluctuations.16 If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business,our share price a

247、nd trading volume could decline.Risk Factors Relating to our Business Our future success depends on our ability to retain key executives and to attract,retain and motivate qualified personnel.We will need to expand our organization,and we may experience difficulties in managing this growth,which cou

248、ld disrupt our operations and our ability to compete.We face potential product liability,and if claims are brought against us,we may incur substantial liability.We rely significantly on information technology and any failure,inadequacy,interruption,or security lapse of that technology,including any

249、cybersecurity incidents,could harm our ability to operate our business effectively.Risks Related to Development,Testing and Commercialization of Our Products Even if our drug candidates receive regulatory approval in the United States,we may never obtain regulatory approval or successfully commercia

250、lize our products outside of the United States.We are subject to uncertainty relating to healthcare reform measures and reimbursement policies which,if not favorable to our drug candidates,could hinder or prevent our drug candidates commercial success.Our commercial success depends upon attaining si

251、gnificant market acceptance of our drug candidates and drug products,if approved,among physicians,nurses,pharmacists,patients and the medical community.Guidelines and recommendations published by government agencies can reduce the use of our drug candidates and drug products,if approved,and negative

252、ly impact our ability to gain market acceptance and market share.If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell our drug candidates,we may be unable to generate any revenue.If we obtain approval to commercialize any appro

253、ved drug products outside of the United States,a variety of risks associated with international operations could materially adversely affect our business.If we are unable to differentiate our drug candidates from branded reference drugs or existing generic therapies for similar treatments,or if the

254、FDA or other applicable regulatory authorities approve generic products that compete with any of our drug candidates,our ability to successfully commercialize our drug candidates would be adversely affected.We face significant competition from other biotechnology and pharmaceutical companies,and our

255、 operating results will suffer if we fail to compete effectively.We could incur substantial costs and disruption to our business and delays in the launch of our drug candidates if our competitors and/or collaborators bring legal actions against us,which could harm our business and operating results.

256、The COVID-19 pandemic,or a similar pandemic,epidemic,or outbreak of an infectious disease,may materially and adversely affect our business and our financial results and could cause a disruption to the development of our drug candidates.We are subject to numerous complex regulatory requirements and f

257、ailure to comply with these regulations,or the cost of compliance with these regulations,may harm our business.If the FDA does not conclude that our drug candidates satisfy the requirements for the 505(b)(2)regulatory approval pathway,or if the requirements for approval of any of our drug candidates

258、 under Section 505(b)(2)are not as we expect,the approval pathway for our drug candidates will likely take significantly longer,cost significantly more and encounter significantly greater complications and risks than anticipated,and in any case may not be successful.Clinical development is a lengthy

259、 and expensive process with an uncertain outcome,and results of earlier studies and trials may not be predictive of future trial results.Failure can occur at any stage of clinical development.Delays in clinical trials are common and have many causes,and any delay could result in increased costs to u

260、s and could jeopardize or delay our ability to obtain regulatory approval and commence drug product sales.We may also find it difficult to enroll patients in our clinical trials,which could delay or prevent development of our drug candidates.Our drug products or drug candidates may cause adverse eff

261、ects or have other properties that could delay or prevent their regulatory approval or limit the scope of any approved label or market acceptance,or result in significant negative consequences following marketing approval,if any.The regulatory approval processes of the FDA and comparable foreign aut

262、horities are lengthy,time consuming and inherently unpredictable,and if we are ultimately unable to obtain regulatory approval for our drug candidates,our business will be substantially harmed.An NDA submitted under Section 505(b)(2)subjects us to the risk that we may be subject to a patent infringe

263、ment lawsuit that would delay or prevent the review or approval of our drug candidate.The FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses.Our drug development strategy relies heavily upon the 505(b)(2)regulatory pathway,which re

264、quires us to certify that we do not infringe upon third-party patents covering approved drugs.Such certifications often result in third-party claims of intellectual property infringement,the defense of which can be costly and time consuming,and an unfavorable outcome in any such litigation may preve

265、nt or delay our development and commercialization efforts,which would harm our business.Our business is subject to extensive regulatory requirements and our drug candidates that obtain regulatory approval will be subject to ongoing and continued regulatory review,which may result in significant expe

266、nse and limit our ability to commercialize such products.17 Our employees,independent contractors,principal investigators,consultants,commercial partners and vendors may engage in misconduct or other improper activities,including non-compliance with regulatory standards and requirements.Any relation

267、ships with healthcare professionals,principal investigators,consultants,customers(actual and potential)and third-party payors are and will continue to be subject,directly or indirectly,to federal and state healthcare fraud and abuse laws,false claims laws,marketing expenditure tracking and disclosur

268、e,or sunshine laws,government price reporting and health information privacy and security laws.If we are unable to comply,or have not fully complied,with such laws,we could face penalties,including,without limitation,civil,criminal,and administrative penalties,damages,monetary fines,disgorgement,pos

269、sible exclusion from participation in Medicare,Medicaid and other federal healthcare programs,contractual damages,reputational harm,diminished profits and future earnings and curtailment or restructuring of our operations.We are required to obtain regulatory approval for each of our drug candidates

270、in each jurisdiction in which we intend to market such products,and the inability to obtain such approvals would limit our ability to realize their full market potential.Risks Relating to our Intellectual Property If we are sued for infringing intellectual property rights of third parties,it will be

271、 costly and time consuming,and an unfavorable outcome in that litigation would have a material adverse effect on our business.We may be subject to claims that our employees,consultants,or independent contractors have wrongfully used or disclosed alleged confidential information or trade secrets of t

272、heir other clients or former employers to us.Our success depends in part upon our ability to protect our intellectual property for our branded drug products and drug candidates.If we fail to comply with our obligations in the agreements under which we license rights to technology from third parties,

273、or if the license agreements are terminated for other reasons,we could lose license rights that are important to our business.We may be subject to claims that our employees,consultants,or independent contractors have wrongfully used or disclosed confidential information of third parties.We may be su

274、bject to claims challenging the inventorship or ownership of our patents and other intellectual property.Intellectual property rights do not necessarily address all potential threats to our competitive advantage.Changes in patent law could diminish the value of patents in general,thereby impairing o

275、ur ability to protect any of our other future drug candidates.We may not be able to protect our intellectual property rights throughout the world.If our estimates or judgments relating to our critical accounting policies for intangible assets prove to be incorrect,further impairment charges could re

276、sult.Risks Related to Our Dependence on Third Parties We do not have internal manufacturing capabilities,and if we fail to develop and maintain supply relationships with various third-party manufacturers,we may be unable to develop or commercialize our drug candidates.Our contract manufacturers may

277、encounter manufacturing failures that could delay the clinical development or regulatory approval of our drug candidates,or their commercial production,if approved.We rely on third parties to conduct our pre-clinical studies and clinical trials.If these third parties do not successfully carry out th

278、eir contractual duties or meet expected deadlines,we may not be able to obtain regulatory approval for or commercialize our drug candidates and our business could be substantially harmed.We rely on third parties to manufacture commercial and clinical supplies of our drug candidates,and we intend to

279、rely on third parties to manufacture commercial supplies of any approved drug products.The commercialization of any of our drug products could be stopped,delayed,or made less profitable if those third parties fail to provide us with sufficient quantities of active pharmaceutical ingredients,excipien

280、ts,or drug products,or fail to do so at acceptable quality levels or prices or fail to maintain or achieve satisfactory regulatory compliance.The design,development,manufacture,supply,and distribution of our drug candidates is highly regulated and technically complex.We may not be successful in esta

281、blishing development and commercialization collaborations which could adversely affect,and potentially prohibit,our ability to develop our drug candidates.We may not be successful in maintaining development and commercialization collaborations,and any partner may not devote sufficient resources to t

282、he development or commercialization of our drug candidates or may otherwise fail in development or commercialization efforts,which could adversely affect our ability to develop certain of our drug candidates and our financial condition and operating results.Risks Related to TaxThere is a significant

283、 risk that we may be classified as a PFIC for U.S.federal income tax purposes.We may not be able to use our net operating loss carry forwards to offset future taxable income for Canadian or U.S.federal income tax purposes.The Internal Revenue Service(“IRS”)may not agree that we should be treated as

284、a foreign corporation for U.S.federal tax purposes.Risks Relating to Ownership of our Common Shares We do not expect to pay any cash dividends for the foreseeable future.The price of our common shares may be volatile.Raising additional capital may cause dilution to our existing shareholders,restrict

285、 our operations,or require us to relinquish rights to our technologies or drug candidates.18 The market price of our common shares could decline if our operating results fall below the expectations of investors or fluctuate.There can be no assurance that an active market for our common shares will b

286、e sustained.If we fail to meet applicable listing requirements,the Nasdaq Stock Market may delist our common shares from trading,in which case the liquidity and market price of our common shares could decline.We may pursue opportunities or transactions that adversely affect our business and financia

287、l condition.We are a Qubec incorporated company headquartered in Canada,and U.S.investors may be unable to enforce certain judgments against us.Any investment in our common shares involves a high degree of risk.The following risk factors and other information included in this annual report should be

288、 carefully considered.If any of these risks actually occur,our business,financial condition,prospects,results of operations or cash flow could be materially and adversely affected,and you could lose all or a part of the value of your investment.Additional risks or uncertainties not currently known t

289、o us,or that we deem immaterial,may also negatively affect our business operations.19 General Risks Related to the Company We may not achieve our publicly announced milestones on time,or at all.From time to time,we may publicly announce the timing of certain events that we expect to occur,such as th

290、e anticipated timing of results from our clinical trials and the timing of an upcoming NDA filing.These statements are forward-looking and are based on the best estimate of management at the time relating to the occurrence of the events.However,the actual timing of these events may differ from what

291、has been publicly disclosed.The timing of events such as completion of a clinical trial,discovery of a new product candidate,filing of an application to obtain regulatory approval,beginning of commercialization of products,completion of a strategic partnership,or announcement of additional clinical

292、trials for a product candidate may ultimately vary from what is publicly disclosed.These variations in timing may occur as a result of different events,including the nature of the results obtained during a clinical trial or during a research phase,problems with a supplier or a distribution partner o

293、r any other event having the effect of delaying the publicly announced timeline.We undertake no obligation to update or revise any forward-looking information,whether as a result of new information,future events or otherwise,except as otherwise required by law.Any variation in the timing of previous

294、ly announced milestones could have a material adverse effect on our business,financial condition or operating results and the trading price of our common shares.We are heavily dependent on the success of our lead drug candidate,GTX-104 Our business and future success are substantially dependent on o

295、ur ability to successfully and timely develop,obtain regulatory approval for,and commercialize our lead product candidate,GTX-104.Any delay or setback in the development of GTX-104 could adversely affect our business.Our planned development,approval and commercialization of GTX-104 may fail to be co

296、mpleted in a timely manner or at all.As part of our recent strategic realignment plan,we determined to focus primarily on the development of GTX-104,which concentrates the level of our drug development risk on one drug candidate.We cannot provide assurance that we will be able to obtain approval for

297、 GTX-104 or any other of our drug candidates from the FDA or any foreign regulatory authority or that we will obtain such approval in a timely manner.We may not be able to maximize value from our de-prioritized drug candidates,GTX-102 and GTX-101,through either development,out-licensing or sale.Our

298、GTX-102 and GTX-101 drug candidates are at an earlier development stage than GTX-104 and will require additional time and resources to develop.As part of our recent strategic realignment plan,we determined to focus primarily on the development of GTX-104 and to de-emphasize the development of GTX-10

299、2 and GTX-101.While we will continue to seek ways to maximize the value of GTX-102 and GTX-101,including through subsequent development,out-licensing or sale,we may not be successful in doing so.We may not be able to maintain our operations and advance our research and development and commercializat

300、ion of our GTX-104 lead drug candidate without additional funding.We have incurred operating losses and negative cash flows from operations since our inception.To date,we have financed our operations through public offerings and private placements of securities,proceeds from exercises of warrants,ri

301、ghts and options,and receipt of research tax credits and research grant programs.Our cash and cash equivalents and short-term investments were$27.9 million as of March 31,2023 and$43.7 million as of March 31,2022.Our current assets,as of March 31,2023,are projected to support our current liabilities

302、 as at that date when combined with the projected level of our expenses for the next twelve months,including fully funding the completion of our Phase 3 program for GTX-104.We expect that additional time and capital will be required by us to file an NDA to obtain FDA approval for GTX-104 in the Unit

303、ed States,to further scale up our manufacturing capabilities,and to complete marketing and other pre-commercialization activities.Consequently,we expect to require additional capital to fund our daily operating needs beyond the next twelve months.Based on the steps we are taking in our strategic rea

304、lignment plan to focus primarily on the development of GTX-104 and to de-emphasize the development of GTX-102 and GTX-101,we believe that our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements beyond the completion of our Phase 3 tri

305、als for GTX-104.To fully execute our business plan,we plan to raise the necessary capital primarily through additional securities offerings and multiple sources of non-dilutive capital,such as grants or loans and strategic alliances.If we are unable to raise additional capital in sufficient amounts

306、or on terms acceptable to us,we may have to significantly delay the research and development and commercial launch of our GTX-104.If we determine to continue development of GTX-102 and GTX-101,significant additional funding will be needed.Unexpected negative results in our clinical programs for our

307、lead drug candidate may affect our ability to raise additional capital and/or complete strategic development and/or distribution partnerships to support the commercial launch of our drug candidate.Additional funding from third parties may not be available on acceptable terms or at all to enable us t

308、o continue with the research and development and commercialization of our lead drug candidate.Business disruptions could seriously harm our future revenue and financial condition and increase our costs and expenses.Our operations,and those of our suppliers,third-party manufacturers and other contrac

309、tors and consultants could be subject to earthquakes,power shortages,telecommunications failures,water shortages,floods,hurricanes,typhoons,fires,extreme weather conditions,medical pandemics and other natural or man-made disasters or business interruptions,for which we are predominantly self-insured

310、.The occurrence of any of these business disruptions could seriously harm our operations and financial condition and increase our costs and expenses.We rely on third-party manufacturers to manufacture our drug candidate products.Our ability to obtain supplies of drug candidate products could be disr

311、upted if the operations of our manufacturers and suppliers are affected by a man-made or natural disaster or other business interruption.We may be subject to foreign exchange rate fluctuations.Our functional currency is the U.S.dollar.However,many of our expenses currently are and/or are expected to

312、 be,denominated in foreign currencies,including Canadian dollars.As we previously completed financings in both Canadian and U.S.dollars,both currencies are maintained and used to make required payments in the applicable currency.Though we plan to implement measures designed to reduce our foreign exc

313、hange rate exposure,the U.S.dollar/Canadian dollar and U.S.dollar/European euro exchange rates have fluctuated significantly in the recent past and may continue to do so,which could have a material adverse effect on our business,financial position and results of operations.If securities or industry

314、analysts do not publish research or publish inaccurate or unfavorable research about our business,our share price and trading volume could decline.The trading market for our common shares will depend in part on the research and reports that securities or industry analysts publish about us or our bus

315、iness.We currently have limited research coverage by securities and industry analysts.If few or no securities or industry analysts cover our company,the trading price for our common shares could be negatively impacted.If one or more of the analysts who covers us downgrades our common shares or publi

316、shes inaccurate or unfavorable research about our 20 business,our share price would likely decline.If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly,demand for our common shares could decrease,which could cause our share price and trading volume to de

317、cline.Risk Factors Relating to our Business Our future success depends on our ability to retain key executives and to attract,retain and motivate qualified personnel.We recently appointed several new members to our executive team and are highly dependent on the principal members of our executive tea

318、m.While members of our executive team have significant industry experience,they have not been with our company for long.Any of our executive officers could leave our employment at any time,as all of our employees are“at will”employees.Also,as part of our strategic realignment,we have significantly r

319、educed the number of our employees while we shift the base of our operations from Canada to the United States.As a result,in the process of shifting the base of our operations to the United States,we will have to recruit employees from the industry employment market in the United States.Recruiting a

320、nd retaining qualified employees for our business,including scientific and technical personnel,will also be critical to our success.There is currently a shortage of skilled executives and other personnel in our industry,which is likely to continue.As a result,competition for skilled personnel is int

321、ense and the turnover rate can be high.As we rebuild our organization in accordance with our strategic realignment,we may not be able to attract and retain personnel on acceptable terms given the competition among numerous pharmaceutical companies for individuals with similar skill sets.In addition,

322、failure to succeed in clinical studies may make it more challenging to recruit and retain qualified personnel.The inability to recruit key executives or the loss of the services of any executive or key employee might impede the progress of our development and commercialization objectives.We may need

323、 to expand our organization,and we may experience difficulties in managing this growth,which could disrupt our operations and our ability to compete.If our drug development efforts are successful,we expect to expand our employee base to increase our managerial,scientific,engineering,operational,sale

324、s,marketing,financial and other resources and to hire more consultants and contractors.Future growth would impose significant additional responsibilities on our management,including the need to identify,recruit,maintain,motivate,and integrate additional employees,consultants and contractors.We may n

325、ot be able to effectively manage the expansion of our operations,which may result in weaknesses in our infrastructure,give rise to operational mistakes,loss of business opportunities,loss of employees and reduced productivity among remaining employees.Future growth could require significant capital

326、expenditures and may divert financial resources from other projects,such as the development of our existing or future product candidates.Our future financial performance and our ability to sell and commercialize our product candidates,if approved,and compete effectively will depend,in part,on our ab

327、ility to effectively manage any future growth.We face potential product liability,and if claims are brought against us,we may incur substantial liability.The use of our product candidates in clinical trials,and the sale of any drug candidates for which we obtain marketing approval,exposes us to the

328、risk of product liability claims.Product liability claims might be brought against us by consumers,healthcare providers,pharmaceutical companies or others selling or otherwise coming into contact with our product candidates.If we cannot successfully defend against product liability claims,we could i

329、ncur substantial liability and costs.In addition,regardless of merit or eventual outcome,product liability claims may result in:impairment of our business reputation;withdrawal of clinical study participantscosts due to related litigationdistraction of managements attention from our primary business

330、substantial monetary awards to patients or other claimants;andthe inability to commercialize our product candidates.Our current product liability insurance coverage may not be sufficient to reimburse us for any expenses or losses we may suffer.Moreover,insurance coverage is becoming increasingly exp

331、ensive,and,in the future,we may not be able to maintain insurance coverage at a reasonable cost or in sufficient amounts to protect us against losses due to liability.A successful product liability claim or series of claims brought against us could cause our share price to decline and,if judgments e

332、xceed our insurance coverage,could adversely affect our results of operations and business.We rely significantly on information technology and any failure,inadequacy,interruption,or security lapse of that technology,including any cybersecurity incidents,could harm our ability to operate our business

333、 effectively.Despite the implementation of security measures,our internal computer systems,and those of third parties with which we contract are vulnerable to damage from cyber-attacks,computer viruses,unauthorized access,natural disasters,terrorism,war and telecommunication and electrical failures.System failures,accidents or security breaches could cause interruptions in our operations and coul