Aytu BioPharma, Inc. (AYTU) 2019年年度報告「NASDAQ」.pdf

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1、SECURITIES&EXCHANGE COMMISSION EDGAR FILINGAYTU BIOSCIENCE,INCForm:10-K Date Filed:2019-09-26Corporate Issuer CIK:1385818 Copyright 2019,Issuer Direct Corporation.All Right Reserved.Distribution of this document is strictly prohibited,subject to the terms of use.UNITED STATESSECURITIES AND EXCHANGE

2、COMMISSIONWashington,D.C.20549 FORM 10-K (Mark One)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30,2019 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 333-146542 AYTU

3、 BIOSCIENCE,INC.(Exact Name of Registrant as Specified in Its Charter)Delaware 47-0883144(State or other jurisdiction ofincorporation or organization)(I.R.S.Employer Identification Number)373 Inverness ParkwaySuite 206Englewood,Colorado 80112(Address of principal executive offices)(Zip Code)(720)437

4、-6580(Registrants telephone number,including area code)Securities registered pursuant to Section 12(b)of the Act:None Securities registered pursuant to Section 12(g)of the Act Common Stock,par value$.0001 per share Indicate by check mark if the Registrant is a well-known seasoned issuer,as defined i

5、n Rule 405 of the Securities Act.Yes No Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d)of the Exchange Act.Yes No Indicate by a check mark whether the Registrant:(1)has filed all reports required to be filed by Section 13 or 15(d)of th

6、e Securities Exchange Act of 1934 duringthe preceding 12 months(or for such shorter period that the Registrant was required to file such reports)and(2)has been subject to such filing requirements forthe past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically an

7、d posted on its corporate Web site,if any,every Interactive Data File required to besubmitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months(or for such shorter period that the registrant was required to submitand post such files).Yes No Indicate by check mark if di

8、sclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein,and will not be contained,to the best ofthe Registrants knowledge,in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K Indi

9、cate by check mark whether the Registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,or a smaller reporting company.Seedefinition of“large accelerated filer”,“accelerated filer”and“smaller reporting company”in Rule 12b-2 of the Exchange Act.(check one):Large accelerate

10、d filerAccelerated filer Non-accelerated filerSmaller reporting company Emerging growth company If an emerging growth company,indicate by check mark if the registrant has elected not to use the extended transition period for comply ing with any new orrevised financial accounting standards provided p

11、ursuant to Section 13a)of the Exchange Act.Indicate by check mark whether the Registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No Title of Each ClassTrading SymbolName of Each Exchange on WhichRegisteredCommon Stock,par value$0.0001 per shareAYTUNasdaq Capital Market T

12、he aggregate market value of common stock held by non-affiliates of the Registrant as of December 31,2018 was$6.9 million based on the closing priceof$0.79 as of that date.Indicate the number of shares outstanding of each of the Registrants classes of common stock,as of the latest practicable date:A

13、s of August 31,2019,there were 17,688,071 shares of common stock issued and outstanding.EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.TABLE OF CONTENTS PAGEPART I Item 1BUSINESS4 Item 1ARISK FACTORS13 Item 1BUNRESOLVED STAFF COMMENTS36 Item 2PROPERTIES37 Item 3LEGAL PR

14、OCEEDINGS37 Item 4MINE SAFETY DISCLOSURES37 PART II Item 5MARKET FOR REGISTRANTS COMMON EQUITY,RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OFEQUITY SECURITIES38 Item 6SELECTED FINANCIAL DATA39 Item 7MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS39 Item 7AQU

15、ANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK42 Item 8FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA42 Item 9CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE42 Item 9ACONTROLS AND PROCEDURES42 Item 9BOTHER INFORMATION43 PART III Item 10DIRECTORS,EXECUTIVE

16、OFFICERS,AND CORPORATE GOVERNANCE44 Item 11EXECUTIVE COMPENSATION47 Item 12SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERMATTERS52 Item 13CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,AND DIRECTOR INDEPENDENCE53 Item 14PRINCIPAL ACCOUNTANT FEES AND SERVICES54

17、 PART IV Item 15EXHIBITS AND FINANCIAL STATEMENT SCHEDULES55 SIGNATURES58Exhibit 23.1 Exhibit 23.2 Exhibit 31.1 Exhibit 31.2 Exhibit 32.1 2EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.Forward-Looking Statements This Annual Report on Form 10-K,or Annual Report,includes

18、 forward-looking statements within the meaning of Section 27A of the Securities Act of 1933,as amended,and Section 21E of the Securities Exchange Act of 1934,or the Exchange Act.All statements other than statements of historical facts contained inthis Annual Report,including statements regarding our

19、 anticipated future clinical and regulatory events,future financial position,business strategy and plans andobjectives of management for future operations,are forward-looking statements.Forward-looking statements are generally written in the future tense and/or arepreceded by words such as“may,”“wil

20、l,”“should,”“forecast,”“could,”“expect,”“suggest,”“believe,”“estimate,”“continue,”“anticipate,”“intend,”“plan,”or similarwords,or the negatives of such terms or other variations on such terms or comparable terminology.Such forward-looking statements include,without limitation,statements regarding th

21、e markets for our approved products and our plans for our approved products,the anticipated start dates,durations and completion dates,as well as the potential future results,of our ongoing and future clinical trials,the anticipated designs of our future clinical trials,anticipated future regulatory

22、submissions and events,the potential future commercialization of our product candidates,our anticipated future cash position and future events under our currentand potential future collaborations.These forward-looking statements are subject to a number of risks,uncertainties and assumptions,includin

23、g without limitationthe risks described in“Risk Factors”in Part I,Item 1A of this Annual Report.These risks are not exhaustive.Other sections of this Annual Report includeadditional factors that could adversely impact our business and financial performance.Moreover,we operate in a very competitive a

24、nd rapidly changingenvironment.New risk factors emerge from time to time and it is not possible for our management to predict all risk factors,nor can we assess the impact of allfactors on our business or the extent to which any factor,or combination of factors,may cause actual results to differ mat

25、erially from those contained in anyforward-looking statements.You should not rely upon forward-looking statements as predictions of future events.We cannot assure you that the events andcircumstances reflected in the forward-looking statements will be achieved or occur and actual results could diffe

26、r materially from those projected in the forward-looking statements.We assume no obligation to update or supplement forward-looking statements.Unless otherwise indicated or unless the context otherwise requires,references in this Form 10-K to the“Company,”“Aytu,”“we,”“us,”or“our”are to AytuBioScienc

27、e,Inc.This Annual Report on Form 10-K refers to trademarks,such as Aytu,Natesto,ZolpiMist,Tuzistra XR,ProstaScint,Primsol,MiOXSYS,RedoxSYS,andFiera which are protected under applicable intellectual property laws and are our property or the property of our subsidiaries.This Form 10-K also containstra

28、demarks,service marks,copyrights and trade names of other companies which are the property of their respective owners.Solely for convenience,ourtrademarks and tradenames referred to in this Form 10-K may appear without the or symbols,but such references are not intended to indicate in any waythat we

29、 will not assert,to the fullest extent under applicable law,our rights to these trademarks and tradenames.We obtained statistical data,market and product data,and forecasts used throughout this Form 10-K from market research,publicly available informationand industry publications.While we believe th

30、at the statistical data,industry data and forecasts and market research are reliable,we have not independentlyverified the data,and we do not make any representation as to the accuracy of the information.Reverse Stock Split Our common stock began trading on the Nasdaq Capital Market on October 20,20

31、17.On August 13,2018,we effected a reverse stock split of theoutstanding shares of our common stock by a ratio of one-for-twenty(the“Reverse Stock Split”).Unless otherwise indicated,all share amounts,per share data,share prices,exercise prices and conversion rates set forth herein have,where applica

32、ble,been adjusted retroactively to reflect the Reverse Stock Split.3EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.AYTU BIOSCIENCE,INC.PART I Item 1.Business Company Overview We are a specialty pharmaceutical company focused on identifying,acquiring,and commercializing

33、novel products that address significant patient needs.We have multiple FDA-approved products on the market,and we seek to build a portfolio of novel therapeutics that serve large medical needs,across a range ofconditions,through our in-house commercial team.Our commercial infrastructure consists of

34、a U.S.-based specialty sales force and an international distributionnetwork with presence in approximately fifty countries.We currently are focused on commercialization of four products,(i)Natesto,a testosterone replacement therapy,or TRT,(ii)Tuzistra XR,a codeinebased antitussive,(iii)ZolpiMistTM,a

35、 short-term insomnia treatment and(iv),MiOXSYS,a novel in vitro diagnostic system for male infertility assessment.In thefuture we will look to acquire additional commercial-stage or near-market products,including existing products we believe can offer distinct commercialadvantages.Our management tea

36、ms prior experience has involved identifying both clinical-stage and commercial-stage assets that can be launched or re-launched to increase value,with a focused commercial infrastructure specializing in novel,niche products.Corporate History We were initially incorporated as Rosewind Corporation on

37、 August 9,2002 in the State of Colorado.Vyrix Pharmaceuticals,Inc.,or Vyrix,was incorporated under the laws of the State of Delaware on November 18,2013 and was wholly-owned by AmpioPharmaceuticals,Inc.(NYSE American:AMPE),or Ampio,immediately prior to the completion of the Merger(defined below).Vyr

38、ix was previously a carve-out ofthe sexual dysfunction therapeutics business,including the late-stage mens health product candidates,Zertane and Zertane-ED,from Ampio,that carve out wasannounced in December 2013.Luoxis Diagnostics,Inc.,or Luoxis,was incorporated under the laws of the State of Delawa

39、re on January 24,2013 and wasmajority-owned by Ampio immediately prior to the completion of the Merger.Luoxis was initially focused on developing and advancing the RedoxSYS System.The MiOXSYS System was developed following the completed development of the RedoxSYS System.On March 20,2015,Rosewind fo

40、rmed Rosewind Merger Sub V,Inc.and Rosewind Merger Sub L,Inc.,each a wholly-owned subsidiary formed for thepurpose of the Merger.On April 16,2015,Rosewind Merger Sub V,Inc.merged with and into Vyrix and Rosewind Merger Sub L,Inc.merged with and intoLuoxis,and Vyrix and Luoxis became subsidiaries of

41、Rosewind.Immediately thereafter,Vyrix and Luoxis merged with and into Rosewind with Rosewind as thesurviving corporation(herein referred to as the Merger).Concurrent with the closing of the Merger,Rosewind abandoned its pre-merger business plans,solely topursue the specialty pharmaceuticals,devices,

42、and diagnostics markets,focusing on large areas of medical need,including the business of Vyrix and Luoxis.When we discuss our business in this Report,we include the pre-Merger business of Luoxis and Vyrix.On June 8,2015,we(i)reincorporated as a domestic Delaware corporation under Delaware General C

43、orporate Law and changed our name from RosewindCorporation to Aytu BioScience,Inc.,and(ii)effected a reverse stock split in which each common stock holder received one share of common stock for each12.174 shares outstanding.At our annual meeting of shareholders held on May 24,2016,our shareholders a

44、pproved(1)an amendment to our Certificate ofIncorporation to reduce the number of authorized shares of common stock from 300.0 million to 100.0 million,which amendment was effective on June 1,2016,and(2)an amendment to our Certificate of Incorporation to affect a reverse stock split at a ratio of 1-

45、for-12 which became effective on June 30,2016.At ourspecial meeting of shareholders held on July 26,2017,our shareholders approved an amendment to our Certificate of Incorporation to affect a reverse stock splitat a ratio of 1-for-20 which became effective on August 25,2017.At our annual meeting of

46、shareholders held on June 27,2018,our shareholders approvedanother reverse stock split at a ratio of 1-for-20 which became effective on August 10,2018.All share and per share amounts in this Report have been adjusted toreflect the effect of these reverse stock splits(hereafter referred to collective

47、ly as the“Reverse Stock Splits”).Our Products and Markets All of our products are sold and distributed through multiple channels,including direct sales to wholesalers or on a sell-through basis using third-partylogistics enterprises.4EDGAR Stream is a copyright of Issuer Direct Corporation,all right

48、s reserved.Natesto(testosterone)nasal gel On July 1,2016 we acquired the exclusive U.S.rights to Natesto(testosterone)nasal gel,from Acerus Pharmaceuticals Corporation,or Acerus.Natesto isa patented,FDA-approved testosterone replacement therapy(TRT)for hypogonadism(low testosterone)in men.Natesto of

49、fers multiple advantages overcurrently available TRTs and competes in a$1.8 billion market accounting for over 6.8 million prescriptions annually.It is the only TRT delivered via a nasal gel.Thus,Natesto does not carry a black box warning related to testosterone transference to a mans female partner

50、 or children;as other topically(primarily gels andsolutions)administered TRTs do;by virtue of their delivery directly onto the skin.Recent clinical trials demonstrate that Natesto achieves hypogonadism symptomimprovement,while maintaining function of the Hypothalamic-Pituitary-Gonadal(HPG)axis;and m

51、aintenance of reproductive parameters in patients.We are positioning Natesto as the ideal treatment solution for hypogonadal men with active,busy lifestyles as Natesto is discreet,portable,and easy to use,while delivering efficacy and a safety profile unique to the TRT product category.Natesto is al

52、so positioned for men who have previously been prescribed a TRT,including Androgel,and want a product with a different clinical profile available in a convenient,easy-to-use,effective therapeutic option.By gaining less than a5%share of the current U.S.market(assuming similar pricing and reimbursemen

53、t),a novel TRT product could achieve annual gross revenues in excess of$90.0million.On July 29,2019,we agreed to amend and restate the License and Supply Agreement with Acerus.The effectiveness of the amended Agreement isconditioned upon Acerus obtaining new financing within six months of signing of

54、 the amended Agreement.Aytu will continue to serve as the exclusive U.S.supplier to purchasers of Natesto,and Acerus will receive performance-based commissions on prescriptions generated by urology and endocrinology specialties.Acerus will assume regulatory and clinical responsibilities and associat

55、ed expenses and will serve a primary role in the development of key opinion leaders inurology and endocrinology.Aytu will focus on commercial channel management,sales to wholesalers and other purchasing customers,and will direct salesefforts in all other physician specialties.Tuzistra XR On November

56、 2,2018,we obtained an exclusive license of FDA-approved Tuzistra XR from Tris Pharma,or Tris.Tuzistra XR is the only FDA-approved12-hour codeine-based antitussive.Tuzistra XR is a prescription antitussive consisting of codeine polistirex and chlorpheniramine polistirex in an extended-releaseoral su

57、spension.The cough and cold prescription market is in excess of$3 billion in sales and more than 30 35 million prescriptions.This market is dominated by short-acting treatments requiring 4 6 daily doses.Tuzistra utilizes a novel,patented extended release technology enabling 12-hour duration of antit

58、ussive effect,offering a significant dosing advantage over current codeine-based treatments.In addition to Tuzistra XR,we also obtained a license for a complementary antitussive product pending FDA approval.5EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.ZolpiMist(zolpi

59、dem tartrate oral spray)On June 11,2018,we acquired an exclusive license for ZolpiMist from Magna Pharmaceuticals,Inc.,or Magna,which we formally launched through ourU.S.sales force in early 2019.This agreement allows for our exclusive commercialization of ZolpiMist in the U.S.and the ability to sub

60、license the product forcommercialization in Canada.The ZolpiMist license adds another unique,commercial-stage product to our product portfolio and provides our U.S.sales force withanother novel product to sell to their already-called-on primary care(family medicine,internal medicine,general practice

61、)physician targets.More than half of oursales forces Natesto physician targets are primary care physicians,so there is a significant overlap in targets and opportunity to enable the sales force toefficiently sell multiple products to these prevalent,high-prescribing clinicians.ZolpiMist is an FDA-ap

62、proved prescription product that is indicated for the short-term treatment of insomnia,and is the only oral spray formulation ofzolpidem tartrate-the most widely prescribed prescription sleep aid in the U.S.ZolpiMist is commercially available and competes in the non-benzodiazepineprescription sleep

63、aid category,a$1.8 billion prescription drug category with over 43 million prescriptions written annually.Thirty million prescriptions of zolpidemtartrate(Ambien,Ambien CR,Intermezzo,Edluar,ZolpiMist,and generic forms of immediate-release,controlled release,and orally dissolving tabletformulations)a

64、re written each year in the U.S.,representing almost 70%of the non-benzodiazepine sleep aid category.Approximately 2.5 million prescriptionsare written annually for novel formulations of zolpidem tartrate products(controlled release and sublingual tablets).MiOXSYS MiOXSYS is a rapid in vitro diagnos

65、tic system that performs a semen analysis test used to measure static oxidation-reduction potential,or sORP,in humansemen.Our MiOXSYS system is a novel,point-of-care semen analysis system with the potential to become a standard of care in the diagnosis and managementof male infertility.Male infertil

66、ity is a prevalent and underserved condition,and oxidative stress(the core biological component measured by the MiOXSYSsystem)is widely implicated in its pathophysiology.MiOXSYS was developed from our previously developed oxidation-reduction potential research platformknown as RedoxSYS.Male infertil

67、ity is often unexplained(idiopathic),and this idiopathic infertility is frequently associated with increased levels of oxidativestress in the semen.As such,having a rapid,easy-to-use diagnostic platform to measure oxidative stress may provide a practical way for reproductive medicineand mens health

68、specialists to improve semen analysis and infertility assessments without having to refer patients to outside clinical laboratories.MiOXSYS is currently marketed outside the U.S.as we advance MiOXSYS towards FDA clearance as an aid in the assessment of male infertility in theU.S.MiOXSYS is a CE mark

69、ed system(that is also Health Canada,Australian TGA and Mexican COFEPRAS approved)and is an accurate,easy to use,andfast infertility assessment tool that directly measures oxidative stress in semen though the direct measurement of oxidation-reduction potential.It is estimated that72.4 million couple

70、s worldwide experience infertility problems.In the U.S.,approximately 10%of couples are defined as infertile.Male infertility is responsible forbetween 40 50%of all infertility cases and affects approximately 7%of all men.Male infertility is prevalent and underserved,and oxidative stress is widelyim

71、plicated in its pathophysiology.The global male infertility market is expected to grow to over$4.7 billion by 2025 with a compound annual growth rate,orCAGR,of nearly 4.6%Oxidative stress is broadly implicated in the pathophysiology of idiopathic male infertility,yet very few diagnostic tools exist

72、to effectivelymeasure oxidative stress levels in men.However,antioxidants are widely available and recommended to infertile men without easy,accurate assessmentmethods available for initial evaluation and subsequent response to antioxidant intervention.With the introduction of the MiOXSYS System,the

73、re is an easy andeffective diagnostic tool to assess the degree of oxidative stress and potentially enable the monitoring of patients responses to antioxidant therapy as atreatment regimen for male infertility.We expect to advance MiOXSYS into clinical trials in the U.S.in order to enable 510(k)de n

74、ovo clearance in the comingtwelve to eighteen months.Our Strategy Our management team has extensive experience across a wide range of business development activities and have in-licensed or acquired products fromlarge,mid-sized,and small enterprises in the U.S.and abroad.Through an assertive product

75、 and business development approach,we expect that we will build asubstantial portfolio of complementary commercial and near-commercial-stage products.Our strategy to create value for shareholders in the near-term is byimplementing a focused,four-pronged strategy:Focus on sales growth of existing U.S

76、.product portfolio.Our primary focus is on growing sales of Natesto in the U.S.and continuing to ramp-up the market launch of both Tuzistra XR and ZolpiMist through our sales force and strategic partners.Expand MiOXSYS Expand the MiOXSYS business outside the U.S.through continued market development,

77、cultivation of key opinion leaders inlarge markets,and the advancement of clinical studies that further validate MiOXSYSs clinical utility in male infertility.Advance MiOXSYS toward FDA Clearance.MiOXSYS is already CE Marked,Health Canada,Australian TGA and Mexico COFEPRIS approved.We are focused on

78、 completing ongoing clinical trials in order to obtain FDA clearance for sale and distribution in the U.S.If cleared in the U.S.,MiOXSYS would be the first and only semen analysis diagnostic test cleared by the FDA for the detection of oxidative stress in infertility.Identify and license or acquire

79、complimentary assets.We plan to augment our core in-development and commercial assets through efficientidentification of complementary products.We intend to seek assets that are near commercial stage or already generating revenues.Further,weintend to seek to acquire products through mergers,asset pu

80、rchases,licensing,co-development,or collaborative commercial arrangements(including co-promotions and co-marketing arrangements).6EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.Government Regulation While we do not have any pharmaceutical product candidates that we are

81、actively developing as of the date of this Report,we may in the future acquiresuch products if such efforts are necessary to achieve our strategic goals.Currently,we are developing one medical device candidate for approval by the FDA,theMiOXSYS System,for which regulatory approval must be received b

82、efore we can market this within the U.S.Approval Process for Pharmaceutical Products In the U.S.,pharmaceutical products are subject to extensive regulation by the FDA.The Federal Food,Drug,and Cosmetic Act,or the FDCA,and otherfederal and state statutes and regulations,govern,among other things,the

83、 research,development,testing,manufacture,storage,recordkeeping,approval,labeling,promotion and marketing,distribution,post-approval monitoring and reporting,sampling,and import and export of pharmaceutical products.Failure tocomply with applicable U.S.requirements may subject a company to a variety

84、 of administrative or judicial sanctions,such as FDA refusal to approve pending newdrug applications,NDAs,warning letters,product recalls,product seizures,total or partial suspension of production or distribution,injunctions,fines,civilpenalties,and criminal prosecution.Approval Process for Medical

85、Devices In the U.S.,the FDCA,FDA regulations and other federal and state statutes and regulations govern,among other things,medical device design anddevelopment,preclinical and clinical testing,premarket clearance or approval,registration and listing,manufacturing,labeling,storage,advertising and pr

86、omotion,sales and distribution,export and import,and post-market surveillance.The FDA regulates the design,manufacturing,servicing,sale and distribution of medicaldevices,including molecular diagnostic test kits and instrumentation systems.Failure to comply with applicable U.S.requirements may subje

87、ct a company to avariety of administrative or judicial sanctions,such as FDA refusal to approve pending applications,warning letters,product recalls,product seizures,total orpartial suspension of production or distribution,injunctions,fines,civil penalties and criminal prosecution.Regulation after F

88、DA Clearance or Approval Any devices we manufacture or distribute pursuant to clearance or approval by the FDA are subject to pervasive and continuing regulation by the FDA andcertain state agencies.We are required to adhere to applicable regulations setting forth detailed cGMP requirements,as set f

89、orth in the QSR,which include,among other things,testing,control and documentation requirements.Noncompliance with these standards can result in,among other things,fines,injunctions,civil penalties,recalls or seizures of products,total or partial suspension of production,refusal of the government to

90、 grant 510k de novo clearance or PMAapproval of devices,withdrawal of marketing approvals and criminal prosecutions,fines and imprisonment.Our contract manufacturers facilities operate under theFDAs cGMP requirements.Foreign Regulatory Approval Outside of the U.S.,our ability to market our product c

91、andidates will be contingent also upon our receiving marketing authorizations from the appropriateforeign regulatory authorities,whether or not FDA approval has been obtained.The foreign regulatory approval process in most industrialized countries generallyencompasses risks similar to those we will

92、encounter in the FDA approval process.The requirements governing conduct of clinical trials and marketingauthorizations,and the time required to obtain requisite approvals,may vary widely from country to country and differ from those required for FDA approval.Other Regulatory Matters Manufacturing,s

93、ales,promotion and other activities following product approval are also subject to regulation by numerous regulatory authorities in additionto the FDA,including,in the U.S.,the Centers for Medicare&Medicaid Services,other divisions of the Department of Health and Human Services,the DrugEnforcement A

94、dministration,the Consumer Product Safety Commission,the Federal Trade Commission,the Occupational Safety&Health Administration,theEnvironmental Protection Agency and state and local governments.In the U.S.,sales,marketing and scientific/educational programs must also comply with stateand federal fr

95、aud and abuse laws.Pricing and rebate programs must comply with the Medicaid rebate requirements of the U.S.Omnibus Budget ReconciliationAct of 1990 and more recent requirements in the Health Care Reform Law,as amended by the Health Care and Education Affordability Reconciliation Act,orACA.If produc

96、ts are made available to authorized users of the Federal Supply Schedule of the General Services Administration,additional laws and requirementsapply.The handling of any controlled substances must comply with the U.S.Controlled Substances Act and Controlled Substances Import and Export Act.Products

97、must meet applicable child-resistant packaging requirements under the U.S.Poison Prevention Packaging Act.Manufacturing,sales,promotion andother activities are also potentially subject to federal and state consumer protection and unfair competition laws.7EDGAR Stream is a copyright of Issuer Direct

98、Corporation,all rights reserved.Drug Quality and Security Act In 2013,the United States Congress passed the Drug Quality and Security Act(“DQSA”),amending the Federal Food,Drug and Cosmetic Act to grant theFDA more authority to regulate and monitor the manufacturing of compounding drugs.Title I of t

99、he DQSA increased regulation of compounding drugs.Title II ofthe DQSA Drug Supply Chain Security,established requirements to facilitate improved tracking of prescription drug products through the supply chain withincreased product identification requirements.Currently,we are required to provide prod

100、uct identification information,or serialization,at the manufacturing batch,or lot level.However,going forward the law requires such tracking to done farther down the distribution chain including,(i)wholesalers authentification andverification in November 2019,(ii)pharmacy authentification and verifi

101、cation in the Fall of 2020,and at the unit level throughout the entire supply chain near theend of 2023.Changes in regulations,statutes or the interpretation of existing regulations could impact our business in the future by requiring,for example:(i)changes toour manufacturing arrangements;(ii)addit

102、ions or modifications to product labeling;(iii)the recall or discontinuation of our products;or(iv)additional record-keeping requirements.If any such changes were to be imposed,they could adversely affect the operation of our business.Reimbursement for our Products in the U.S.Natesto,Tuzistra XR and

103、 ZolpiMist(our“US Approved Products”)are covered by many commercial insurance providers and pharmacy benefit managementcompanies and are dependent upon reimbursement for continued use in the U.S.market.Additionally,privately managed Medicare Part D and other governmentplans may choose to cover our U

104、.S.Approved Products prescribed through their plans pharmacy benefits.We do not anticipate that the sales of the MiOXSYS System,if approved for sale in the U.S.,will be heavily dependent upon reimbursement by third-partypayors in the U.S.given that infertility testing and treatment is infrequently c

105、overed by commercial insurers or public payors.Traditionally,sales ofpharmaceuticals,diagnostics,ad devices that are not“lifestyle”indications depend,in part,on the extent to which products will be covered by third-party payors,such as government health programs,commercial insurance and managed heal

106、thcare organizations.These third-party payors are increasingly reducingreimbursements for medical products and services.Lack of third-party reimbursement for our product candidate or a decision by a third-party payor to not cover our product candidates could reduce physicianusage of the product cand

107、idate and have a material adverse effect on our sales,results of operations and financial condition.In addition,in some foreign countries,the proposed pricing for a drug must be approved before it may be lawfully marketed.The requirements governingdrug pricing vary widely from country to country.For

108、 example,the European Union provides options for its member states to restrict the range of medicinalproducts for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use.A member statemay approve a specific price for the medic

109、inal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing themedicinal product on the market.There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products willallow favorable

110、reimbursement and pricing arrangements for any of our products.Historically,products launched in the European Union do not follow pricestructures of the U.S.and prices generally tend to be lower than in the U.S.DEA Regulation Natesto,Tuzistra XR and ZolpiMist,already approved by the FDA,are each a“c

111、ontrolled substance”as defined in the Controlled Substances Act of 1970,orCSA,because Natesto contains testosterone,ZolpiMist contains zolpidem tartrate,and Tuzistra XR contains codeine.As a result,the U.S.Drug EnforcementAgencies,or DEA,have Natesto and Tuzistra XR listed and regulated as Schedule

112、III substances,while ZolpiMist is listed and regulated as a Schedule IVsubstance.Annual registration is required for any facility that manufactures,distributes,dispenses,imports or exports any controlled substance.The registration isspecific to the particular location,activity and controlled substan

113、ce schedule.For example,separate registrations are needed for import and manufacturing,andeach registration will specify which schedules of controlled substances are authorized.Similarly,separate registrations are also required for separate facilities.The DEA typically inspects a facility to review

114、its security measures prior to issuing a registration and on a periodic basis.Reports must also be made forthefts or losses of any controlled substance,and to obtain authorization to destroy any controlled substance.In addition,special permits and notificationrequirements apply to imports and export

115、s of narcotic drugs.The DEA establishes annually an aggregate quota for how much of a controlled substance may be produced in and/or imported into the U.S.based on theDEAs estimate of the quantity needed to meet legitimate scientific and medicinal needs.The DEA may adjust aggregate production quotas

116、 and individualproduction and procurement quotas from time to time during the year,although the DEA has substantial discretion in whether or not to make such adjustments.Our or our manufacturers quotas of an active ingredient may not be sufficient to meet commercial demand or complete clinical trial

117、s.Any delay,limitation orrefusal by the DEA in establishing our or our manufacturers quota for controlled substances could delay or stop our clinical trials or product launches,which couldhave a material adverse effect on our business,financial position and results of operations.To enforce these req

118、uirements,the DEA conducts periodic inspections of registered establishments that handle controlled substances.Failure to maintaincompliance with applicable requirements,particularly as manifested in loss or diversion,can result in administrative,civil or criminal enforcement action that couldhave a

119、 material adverse effect on our business,results of operations and financial condition.The DEA may seek civil penalties,refuse to renew necessaryregistrations,or initiate administrative proceedings to revoke those registrations.In some circumstances,violations could result in criminal proceedings.8E

120、DGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.Individual states also independently regulate controlled substances.We and our manufacturers will be subject to state regulation on distribution of theseproducts,including,for example,state requirements for licensures or reg

121、istration.Intellectual Property Natesto Aytu has an exclusive license from Acerus Pharmaceuticals Corporation(“Acerus”)for the U.S.rights to intellectual property related to a nasal gel drugproduct containing testosterone to treat hypogonadism in males,including the FDA approved product Natesto,as w

122、ell as an authorized generic version and OTCversions thereof.The license includes sublicense rights to intellectual property owned by Mattern Pharmaceuticals and exclusively licensed to Acerus by MatternPharmaceuticals.The sublicensed intellectual property includes four Orange Book listed patents di

123、rected at nasal gel formulations containing testosterone ormethods of testosterone replacement therapy by nasal administration of the same.It further includes three patents that are not listed in the Orange Book directedat a testosterone formulation,a method of making a testosterone formulation and

124、a method for reducing physical or chemical interactions between a nasaltestosterone formulation and a plastic container.The Acerus license also grants rights to intellectual property owned by Acerus which includes nine nonprovisional patent applications,some of which may beabandoned.These patent app

125、lications include at least four pending applications directed to testosterone titration methods,intranasal testosterone bio-adhesive gelformulations,and controlled release testosterone formulations.On July 29,2019,we agreed to amend and restate the License and Supply Agreement with Acerus.The effect

126、iveness of the amended Agreement isconditioned upon Acerus obtaining new financing within six months of signing of the amended Agreement.Aytu will continue to serve as the exclusive U.S.supplier to purchasers of Natesto,and Acerus will receive performance-based commissions on prescriptions generated

127、 by urology and endocrinology specialties.Acerus will assume regulatory and clinical responsibilities and associated expenses and will serve a primary role in the development of key opinion leaders inurology and endocrinology.Aytu will focus on commercial channel management,sales to wholesalers and

128、other purchasing customers,and will direct salesefforts in all other physician specialties.Tuzistra XR Aytu has an exclusive license to commercialize Tuzistra XR in the US and,through this relationship,Aytu is listed as the Tuzistra XR New Drug Applicationholder and holder of two Orange Book listed

129、patents protecting Tuzistra XR.Both patents cover the extended release technology supporting Tuzistra XRs longduration of antitussive effect,and the patents extend to March of 2029.MiOXSYS We have an extensive range of intellectual property for MiOXSYS.We have patent protection in the U.S.and severa

130、l other large markets worldwide forMiOXSYS and the oxidation-reduction potential platform.Specifically,we have numerous patents issued and pending for the MiOXSYS system,the sensors,andtheir clinical and scientific use in the U.S.,Europe,Canada,Israel,Japan,and China.Our patent portfolio related to

131、MiOXSYS and the underlying oxidation-reduction potential(ORP)technology is focused on the U.S.and core foreignjurisdictions which include Europe,Canada,Israel,Japan and China.The portfolio is supported in the U.S.and core foreign jurisdictions and consists of 44 issuedpatents and 18 pending applicat

132、ions.The portfolio primarily consists of eight families filed in the U.S.and in core foreign jurisdictions.The first family includes thirteen issued patents with claimsdirected to the measurement of the ORP of a patient sample to evaluate various conditions.The standard 20-year expiration for patent

133、s in this family is in 2028.The second family includes two pending U.S.applications,three issued U.S.patents,one pending application in core foreign jurisdictions and four issued patentsin core foreign jurisdictions with claims directed to the measurement of the ORP capacity of a patient sample to e

134、valuate various conditions.The standard 20-yearexpiration for patents in this family is in 2033.The third family includes nineteen issued patents with claims directed to devices and methods for the measurementof ORP and ORP capacity.The standard 20-year expiration for patents in this family is in 20

135、32.The fourth family includes two issued U.S.patents,two issuedpatents in core foreign jurisdictions and four pending applications in core foreign jurisdictions with claims directed to multiple layer gel test strip measurementdevices and methods of making for use in measuring ORP and ORP capacity.Th

136、e standard 20-year expiration for patents in this family is in 2033.The fifth familyincludes one pending U.S.application,one issued U.S.patent and seven pending applications in core foreign jurisdictions with claims directed to methods fordetermining fertility characteristics from the ORP of a biolo

137、gical sample.The standard 20-year expiration for patents in this family is in 2035.The sixth familyincludes one pending U.S.application with claims directed to methods for evaluating stroke patients from the ORP characteristics of a biological sample.Thestandard 20-year expiration for patents in thi

138、s family is in 2036.The seventh family includes one pending application filed under the Patent Cooperation Treatywith claims directed to methods for embryo selection from the ORP characteristics of a biological sample.The standard 20-year expiration for patents in this familyis in 2038.The eighth fa

139、mily includes one pending application filed under the Patent Cooperation Treaty with claims directed to methods of treating infertility invaricocele patients.9EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.We have also exclusively licensed the issued and pending patents

140、 protecting Natesto.There are four FDA Orange Book-listed patents surrounding methodsof use of a nasally-administered testosterone gel and formulations thereof.The standard 20-year expiration for patents across these four patents is 2024.There are two FDA Orange Book-listed patents protecting Tuzist

141、ra XR.Through our exclusively commercialization agreement with TRIS Pharma,we are theFDA-recognized New Drug Application holder and thus the designated holder of these patents.The first patent describes a coated ion-exchange resin complexdelivering an extended release formulation and methods therein

142、.The standard 20-year exclusivity for this patent is in 2029.The second patent covers an aqueousliquid suspension containing a drug-ion exchange resin complex and methods therein.The standard 20-year exclusivity for this patent is in 2027.We also maintain trade secrets and proprietary know-how that

143、we seek to protect through confidentiality and nondisclosure agreements.These agreementsmay not provide meaningful protection or adequate remedies in the event of unauthorized use or disclosure of confidential and proprietary information.If we donot adequately protect our trade secrets and proprieta

144、ry know-how,our competitive position and business prospects could be materially harmed.We expect to seek U.S.and foreign patent protection for drug and device products we discover,as well as therapeutic and device products and processes.We expect also to seek patent protection or rely upon trade sec

145、ret rights to protect certain other technologies which may be used to discover and characterizedrugs and device products and processes,and which may be used to develop novel therapeutic and diagnostic products and processes.We will be able to protect our proprietary intellectual property rights from

146、 unauthorized use by third parties primarily to the extent that such rights are coveredby valid and enforceable patents or are effectively maintained as trade secrets.If we must litigate to protect our intellectual property from infringement,we mayincur substantial costs and our officers may be forc

147、ed to devote significant time to litigation-related matters.The laws of certain foreign countries do not protectintellectual property rights to the same extent as do the laws of the U.S.Our pending patent applications,or those we may file or license from third parties in thefuture,may not result in

148、patents being issued.Until a patent is issued,the claims covered by an application for patent may be narrowed or removed entirely,thusdepriving us of adequate protection.As a result,we may face unanticipated competition,or conclude that without patent rights the risk of bringing productcandidates to

149、 market exceeds the returns we are likely to obtain.We are generally aware of the scientific research being conducted in the areas in which wefocus our research and development efforts,but patent applications filed by others are maintained in secrecy for at least 18 months and,in some cases in theU.

150、S.,until the patent is issued.The publication of discoveries in scientific literature often occurs substantially later than the date on which the underlyingdiscoveries were made.As a result,it is possible that patent applications for products similar to our drug or diagnostic products and product ca

151、ndidates may havealready been filed by others without our knowledge.U.S.Patent Term Restoration and Marketing Exclusivity Depending upon the timing,duration and other specific aspects of the FDA approval of our drug candidates,some of our U.S.patents may be eligible forlimited patent term extension

152、under the Drug Price Competition and Patent Term Restoration Act of 1984,commonly referred to as the Hatch-WaxmanAmendments.The Hatch-Waxman Amendments permit a patent restoration term of up to five years as compensation for patent term lost during productdevelopment and the FDA regulatory review pr

153、ocess.However,patent term restoration cannot extend the remaining term of a patent beyond a total of 14 yearsfrom the products approval date.The patent term restoration period is generally one-half the time between the effective date of an IND and the submission dateof an NDA plus the time between t

154、he submission date of an NDA and the approval of that application.Only one patent applicable to an approved drug is eligiblefor the extension and the application for the extension must be submitted prior to the expiration of the patent.The U.S.Patent and Trademark Office,inconsultation with the FDA,

155、reviews and approves the application for any patent term extension or restoration.In the future,if any of our NDAs are approved,weintend to apply for restoration of patent term for one of our currently owned or licensed patents to add patent life beyond the current expiration date,depending onthe ex

156、pected length of the clinical trials and other factors involved in the filing of the relevant NDA.Competition The healthcare industry is highly competitive and subject to significant and rapid technological change as researchers learn more about diseases anddevelop new technologies and treatments.Si

157、gnificant competitive factors in our industry include product efficacy and safety;quality and breadth of anorganizations technology;skill of an organizations employees and its ability to recruit and retain key employees;timing and scope of regulatory approvals;government reimbursement rates for,and

158、the average selling price of,products;the availability of raw materials and qualified manufacturing capacity;manufacturing costs;intellectual property and patent rights and their protection;and sales and marketing capabilities.Market acceptance of our current productsand product candidates will depe

159、nd on a number of factors,including:(i)potential advantages over existing or alternative therapies or tests,(ii)the actual orperceived safety of similar classes of products,(iii)the effectiveness of sales,marketing,and distribution capabilities,and(iv)the scope of any approval providedby the FDA or

160、foreign regulatory authorities.10EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.We are a very small specialty pharmaceuticals company compared to other companies that we are competing against.Our current and potential competitorsinclude large pharmaceutical,biotechnolog

161、y,diagnostic,and medical device companies,as well as specialty pharmaceutical and generic drug companies.Manyof our current and potential competitors have substantially greater financial,technical and human resources than we do and significantly more experience in themarketing,commercialization,disc

162、overy,development and regulatory approvals of products,which could place us at a significant competitive disadvantage ordeny us marketing exclusivity rights.Specifically,our competitors will most likely have larger sales teams and have more capital resources to support theirproducts then we do.Accor

163、dingly,our competitors may be more successful than we may be in achieving widespread market acceptance and obtaining FDA approval for productcandidates.We anticipate that we will face intense and increasing competition as new products enter the market,as advanced technologies become available andas

164、generic forms of currently branded products become available.Finally,the development of new treatment methods for the diseases we are targeting couldrender our products non-competitive or obsolete.We cannot assure you that any of our products that we acquire or successfully develop will be clinicall

165、y superior or scientifically preferable to productsdeveloped or introduced by our competitors.Our current approved products compete in highly competitive fields whereby there are numerous options available to clinicians including generics.Thesegeneric treatment options are frequently less expensive

166、and more widely available.Natesto The U.S.prescription testosterone market is comprised primarily of topically applied treatments in the form of gels,solutions,and patches.Testopel,aninjectable pellet typically implanted directly under the skin by a physician,is also FDA-approved.AndroGel is the mar

167、ket-leading TRT and is marketed by AbbVie.Tuzistra XR Tuzistra XR competes in the approximately$3.0 billion antitussive category and has a distinct advantage over the existing codeine-based antitussives.Tuzistra XR is the only liquid codeine antitussive with a 12-hour duration of effective,which pro

168、vides more dosing convenience than the current 4-6 hour codeinecough syrups.ZolpiMist ZolpiMist competes in a large prescription category with over 43 million prescriptions written annually and generating$1.8 billion in wholesale sales.Thenon-benzodiazepine prescription sleep aid market is dominated

169、 by zolpidem tartrate(brand name Ambien),which accounts for approximately 30 millionprescriptions annually.Various forms of zolpidem tartrate are commercially available,including both immediate release and controlled release tablets as well asorally dissolving tablets.ZolpiMist is the only oral spra

170、y formulation of zolpidem tartrate and,if only achieving 1%of the zolpidem market this product couldgenerate 300,000 prescriptions annually in the U.S.No zolpidem tartrate products are actively marketed in the U.S.,so we believe our sales force will have theability to effectively influence physician

171、 prescribing and grow ZolpiMist prescriptions.MiOXSYS With respect to MiOXSYS competitive offerings,there are other oxidative stress diagnostic tests available throughout the world,although none are approvedin the U.S.for clinical use,and none are used specifically in semen analysis.General use oxid

172、ative stress diagnostic systems that are marketed for clinical useoutside the U.S.include the FRAS 4 system(H&D srl),FREE Carpe Diem(Diacron International),and the FORM and FORMPlus systems(Callegari srl).Thesesystems are used in both research and clinical settings but do not generate significant sa

173、les in the clinical setting and,again,are not used specifically in semenanalysis for infertility testing.These potentially competitive oxidative stress systems testing parameters differ significantly from MiOXSYS and would need todemonstrate clinical superiority to MiOXSYS in order to substantially

174、detract from MiOXSYS prescribing and sales.Additionally,to our knowledge,these systemshave not demonstrated clinical feasibility in human semen or seminal plasma.These tests are used for research use,but they do not measure oxidation-reduction potential and,we believe,are not directly competitive to

175、 the MiOXSYS System in the context of research use.Research and Development The research and development required for FDA approval of Natesto,ZolpiMist,and Tuzistra XR has been conducted by either previous owners of theproducts or the companies from which we licensed or acquired these products.To th

176、e extent we seek to further develop our products and/or improve clinicalclaims.we rely upon outside collaborators to conduct research as we focus primarily on commercialization.11EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.Currently,there is an ongoing investigator-i

177、nitiated study for Natesto.We are financially supporting the study being conducted at the University of Miami,through which the investigators seek to demonstrate that Natesto improves hypogonadism while preserving fertility.The study has been designed and is led by Dr.Ranjith Ramasamy,MD,Director of

178、 Reproductive Urology at the University of Miamis Department of Urology.The study is expected to be completed in 2019.Iffound to preserve fertility,Natesto would be the first TRT to demonstrate this and,we expect,these results would further support the clinical differentiation ofNatesto in the TRT c

179、ategory.Our MiOXSYS System has been developed in conjunction with numerous medical device and diagnostic development consultants.Further,we haverelationships with regulatory consultants who are actively assisting in the development of our regulatory strategy with the FDA as MiOXSYS advances to thiss

180、tage.To complement our internal clinical research efforts with the MiOXSYS System,we have engaged with numerous academic and private researchersaround the world to identify and develop research and clinical applications for the MiOXSYS System.Manufacturing Our business strategy is to use cGMP compli

181、ant contract manufacturers for the manufacture of clinical supplies as well as for commercial supplies ifrequired by our commercialization plans,and to transfer manufacturing responsibility to our collaboration partners when possible.Natesto On April 22,2016,we entered into a license and supply agre

182、ement with Acerus pursuant to which we will pay Acerus a supply price per unit of the greaterof(i)a fixed percentage of Acerus cost of goods sold for Natesto,not to exceed a fixed ceiling price and(ii)a moderate double digit percentage of net sales forthe first year of the agreement,that increased i

183、n each of the second and third years and remains constant after that.Tuzistra XROn November 5,2018 we entered into a licensing,manufacturing and supply agreement with TRIS,pursuant to which TRIS has the exclusive rights tomanufacture,label,package and supply us Tuzistra XR on an exclusive basis in t

184、he U.S.We expect to continue to source Tuzistra XR under this arrangement forthe term of the agreement with TRIS.ZolpiMist On June 11,2018 we entered into a licensing agreement with Magna,pursuant to which we assumed a manufacturing agreement with a cGMP compliantcontract manufacturer.We expect to c

185、ontinue manufacturing through that third-party and have made an initial and subsequent purchase of product that we expectto supply us for the foreseeable future.MiOXSYS We secured supply and quality agreements with manufacturers for both the MiOXSYS instrument as well as MiOXSYS sensor strips.Both m

186、anufacturershold long-standing ISO 13485:2003 certifications and are established medical device manufacturers.Both manufacturers have high volume manufacturingcapacity such that production volumes can be easily scaled.Both manufacturers have been audited by our quality engineers and are fully compli

187、ant.Employees As of August 31,2019,we had 53 full-time employees and utilized the services of a number of consultants on a temporary basis.Overall,we have notexperienced any work stoppage and do not anticipate any work stoppage in the foreseeable future.None of our employees is subject to a collecti

188、ve bargainingagreement.Management believes that relations with our employees are good.Available Information Our principal executive offices are located at 373 Inverness Parkway,Suite 206,Englewood,Colorado 80112 USA,and our phone number is(720)437-6580.We maintain a website on the internet at http:/

189、.We make available,free of charge,through our website,by way of a hyperlink to a third-party site that includes filings we make with the SEC website(www.sec.gov),our annual reports on Form 10-K,quarterly reports on Form 10-Q,current reports onForm 8-K and amendments to those reports electronically f

190、iled or furnished pursuant to Section 15(d)of the Exchange Act.The information on our website is not,and shall not be deemed to be,a part of this Annual Report on Form 10-K or incorporated into any other filings we make with the SEC.In addition,the public mayread and copy any materials we file with

191、the SEC at the SECs Public Reference Room at 100 F Street,N.E.,Washington D.C.,20549.Information on theoperation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330.12EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.Code of Ethics We have ado

192、pted a written code of ethics that applies to our officers,directors and employees,including our principal executive officer and principalaccounting officer.We intend to disclose any amendments to,or waivers from,our code of ethics that are required to be publicly disclosed pursuant to rules of theS

193、EC by filing such amendment or waiver with the SEC.This code of ethics and business conduct can be found in the corporate governance section of ourwebsite,http:/.Item 1A.Risk Factors Investing in our securities includes a high degree of risk.You should consider carefully the specific factors discuss

194、ed below,together with all of the otherinformation contained in this Annual Report.If any of the following risks actually occurs,our business,financial condition,results of operations and future prospectswould likely be materially and adversely affected.This could cause the market price of our secur

195、ities to decline and could cause you to lose all or part of yourinvestment.Risks Related to Our Financial Condition and Capital Requirements We have a limited operating history,have incurred losses,and can give no assurance of profitability.We are a commercial-stage healthcare company with a limited

196、 operating history.Prior to implementing our commercial strategy in the fourth calendarquarter of 2015,we did not have a focus on profitability.As a result,we have not generated substantial revenue to date and are not profitable and have incurredlosses in each year since our inception.Our net loss f

197、or the years ended June 30,2019 and 2018 was$27.1 million and$10.2 million,respectively.We have notdemonstrated the ability to be a profit-generating enterprise to date.Even though we expect to have revenue growth in the next several fiscal years,it is uncertainthat the revenue growth will be signif

198、icant enough to offset our expenses and generate a profit in the future.Our ability to generate significant revenue isuncertain,and we may never achieve profitability.We have a very limited operating history on which investors can evaluate our potential for future success.Potential investors should

199、evaluate us in light of the expenses,delays,uncertainties,and complications typically encountered by early-stage healthcarebusinesses,many of which will be beyond our control.These risks include the following:uncertain market acceptance of our products and product candidates;lack of sufficient capit

200、al;U.S.regulatory approval of our products and product candidates;foreign regulatory approval of our products and product candidates;unanticipated problems,delays,and expense relating to product development and implementation;lack of sufficient intellectual property;the ability to attract and retain

201、 qualified employees;competition;and technological changes.As a result of our limited operating history,and the increasingly competitive nature of the markets in which we compete,our historical financial data,is oflimited value in anticipating future operating expenses.Our planned expense levels wil

202、l be based in part on our expectations concerning future operations,whichis difficult to forecast accurately based on our limited operating history and the recentness of the acquisition of our products Natesto,Tuzistra XR,ZolpiMist,andMiOXSYS.We may be unable to adjust spending in a timely manner to

203、 compensate for any unexpected budgetary shortfall.We have not received any substantial revenues from the commercialization of our current products to date and might not receive significant revenues fromthe commercialization of our current products or our product candidates in the near term.Even tho

204、ugh Natesto,Tuzistra XR and ZolpiMist are each an approveddrug that we are marketing,we only acquired Natesto in April 2016,ZolpiMist in June 2018,and Tuzistra XR in November 2018.In addition,we only launched ourMiOXSYS device in early fiscal 2017.As a result,we have limited experience on which to b

205、ase the revenue we could expect to receive from sales of theseproducts.To obtain revenues from our products and product candidates,we must succeed,either alone or with others,in a range of challenging activities,including expanding markets for our existing products and completing clinical trials of

206、our product candidates,obtaining positive results from those clinical trials,achieving marketing approval for those product candidates,manufacturing,marketing and selling our existing products and those products for which we,or ourcollaborators,may obtain marketing approval,satisfying any post-marke

207、ting requirements and obtaining reimbursement for our products from private insurance orgovernment payors.We,and our collaborators,if any,may never succeed in these activities and,even if we do,or one of our collaborators does,we may nevergenerate revenues that are sufficient enough for us to achiev

208、e profitability.13EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.We may need to raise additional funding,which may not be available on acceptable terms,or at all.Failure to obtain necessary capital whenneeded may force us to delay,limit or terminate our product expansio

209、n and development efforts or other operations.We are expending resources to expand the market for Natesto,Tuzistra XR,ZolpiMist and MiOXSYS,none of which might be as successful as we anticipateor at all and all of which might take longer and be more expensive to market than we anticipate.We also are

210、 currently advancing our MiOXSYS device throughclinical development.Developing product candidates is expensive,lengthy and risky,and we expect to incur research and development expenses in connectionwith our ongoing clinical development activities with the MiOXSYS System.As of June 30,2019,our cash,

211、cash equivalents and restricted cash totaling$11.3million,available to fund our operations offset by an aggregate$3.4 million in accounts payable and other and accrued liabilities.In November 2016,weconducted a public offering of our common stock and warrants from which we received gross proceeds of

212、 approximately$8.6 million.We closed on a privateplacement of common stock,Series A preferred stock and warrants in August 2017 from which we received gross proceeds of approximately$11.8 million.Wealso closed on an underwritten public offering of our common stock,warrants,and Series B preferred sto

213、ck in March 2018 from which we received grossproceeds of approximately$12.9 million.Our operating plan may change as a result of many factors currently unknown to us,and we may need to seek additionalfunds sooner than planned,through public or private equity or debt financings,government or other th

214、ird-party funding,marketing and distribution arrangementsand other collaborations,strategic alliances and licensing arrangements or a combination of these approaches.In any event,we will require additional capital tocontinue the expansion of marketing efforts for Natesto,Tuzistra XR,ZolpiMist,and to

215、 obtain regulatory approval for,and to commercialize,our current productcandidate,the MiOXSYS System.Raising funds in the current economic environment,as well our lack of operating history,may present additional challenges.Even if we believe we have sufficient funds for our current or future operati

216、ng plans,we may seek additional capital if market conditions are favorable or if wehave specific strategic considerations.Any additional fundraising efforts may divert our management from their day-to-day activities,which may adversely affect our ability to expand any existingproduct or develop and

217、commercialize our product candidates.In addition,we cannot guarantee that future financing will be available in sufficient amounts or onterms acceptable to us,if at all.Moreover,the terms of any financing may adversely affect the holdings or the rights of our stockholders and the issuance ofaddition

218、al securities,whether equity or debt,by us,or the possibility of such issuance,may cause the market price of our shares to decline.The sale of additionalequity or convertible securities would dilute all of our stockholders.The incurrence of indebtedness would result in increased fixed payment obliga

219、tions and wemay be required to agree to certain restrictive covenants,such as limitations on our ability to incur additional debt,limitations on our ability to acquire,sell orlicense intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our

220、business.We could also be required toseek funds through arrangements with collaborative partners or otherwise at an earlier stage than otherwise would be desirable and we may be required torelinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to

221、us,any of which may have a material adverse effecton our business,operating results and prospects.If we are unable to obtain funding on a timely basis,we may be unable to expand the market for Natesto,Tuzistra XR,ZolpiMist,or MiOXSYS and/or berequired to significantly curtail,delay or discontinue on

222、e or more of our research or development programs for the MiOXSYS system,or any future productcandidate or expand our operations generally or otherwise capitalize on our business opportunities,as desired,which could materially affect our business,financialcondition and results of operations.If we do

223、 not obtain the capital necessary to fund our operations,we will be unable to successfully expand the commercialization of Natesto,Tuzistra XR and ZolpiMist and to develop,obtain regulatory approval of,and commercialize,our current product candidate,the MiOXSYS System.The expansion of marketing and

224、commercialization activities for our existing products and the development of pharmaceutical products,medical diagnosticsand medical devices is capital-intensive.We anticipate we may require additional financing to continue to fund our operations.Our future capital requirements willdepend on,and cou

225、ld increase significantly as a result of,many factors including:the costs,progress and timing of our efforts to expand the marketing of Natesto,Tuzistra XR and ZolpiMist;progress in,and the costs of,our pre-clinical studies and clinical trials and other research and development programs;the costs of

226、 securing manufacturing arrangements for commercial production;the scope,prioritization and number of our research and development programs;the achievement of milestones or occurrence of other developments that trigger payments under any collaboration agreements we obtain;the costs of establishing,e

227、xpanding or contracting for sales and marketing capabilities for any existing products and if we obtain regulatoryclearances to market our current product candidate,the MiOXSYS system;the extent to which we are obligated to reimburse,or entitled to reimbursement of,clinical trial costs under future

228、collaboration agreements,if any;andthe costs involved in filing,prosecuting,enforcing and defending patent claims and other intellectual property rights.14EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.If funds are not available,we may be required to delay,reduce the sc

229、ope of,or eliminate one or more of our commercialization efforts or our technologies,research or development programs.We will incur increased costs associated with,and our management will need to devote substantial time and effort to,compliance with publiccompany reporting and other requirements.As

230、a public company,we incur significant legal,accounting and other expenses.In addition,the rules and regulations of the SEC and any national securitiesexchange to which we may be subject in the future impose numerous requirements on public companies,including requirements relating to our corporategov

231、ernance practices,with which we will need to comply.Further,we will continue to be required to,among other things,file annual,quarterly and current reportswith respect to our business and operating results.Based on currently available information and assumptions,we estimate that we will incur up to

232、approximately$500,000 in expenses on an annual basis as a direct result of the requirements of being a publicly traded company.Our management and other personnel willneed to devote substantial time to gaining expertise regarding operations as a public company and compliance with applicable laws and

233、regulations,and ourefforts and initiatives to comply with those requirements could be expensive.If we fail to establish and maintain proper internal controls,our ability to produce accurate financial statements or comply with applicableregulations could be impaired.Our management is responsible for

234、establishing and maintaining adequate internal control over financial reporting.Pursuant to Section 404 of the Sarbanes-Oxley Act,our management conducted an assessment of the effectiveness of our internal controls over financial reporting for the year ended June 30,2019 andconcluded that such contr

235、ol was effective.However,if in the future we were to conclude that our internal control over financial reporting were not effective,we cannot be certain as to the timing ofcompletion of our evaluation,testing and remediation actions or their effect on our operations because there is presently no pre

236、cedent available by which tomeasure compliance adequacy.As a consequence,we may not be able to complete any necessary remediation process in time to meet our deadline forcompliance with Section 404 of the Sarbanes-Oxley Act.Also,there can be no assurance that we will not identify one or more materia

237、l weaknesses in our internalcontrols in connection with evaluating our compliance with Section 404 of the Sarbanes-Oxley Act.The presence of material weaknesses could result in financialstatement errors which,in turn,could require us to restate our operating results.If we are unable to conclude that

238、 we have effective internal control over financial reporting or if our independent auditors are unwilling or unable to provideus,when required,with an attestation report on the effectiveness of internal control over financial reporting as required by Section 404 of the Sarbanes-Oxley Act,investors m

239、ay lose confidence in our operating results,our stock price could decline and we may be subject to litigation or regulatory enforcement actions.Inaddition,if we are unable to meet the requirements of Section 404 of the Sarbanes-Oxley Act,we may not be able to maintain listing on the NASDAQ CapitalMa

240、rket.Risks Related to Product Development,Regulatory Approval and Commercialization Natesto,Tuzistra XR,ZolpiMist,and MiOXSYS may prove to be difficult to effectively commercialize as planned.Various commercial,regulatory,and manufacturing factors may impact our ability to maintain or grow revenues

241、from sales of Natesto,MiOXSYS.Specifically,we may encounter difficulty by virtue of:our inability to adequately market and increase sales of any of these products;our inability to secure continuing prescribing of any of these products by current or previous users of the product;our inability to effe

242、ctively transfer and scale manufacturing as needed to maintain an adequate commercial supply of these products;reimbursement and medical policy changes that may adversely affect the pricing,profitability or commercial appeal of Natesto,Tuzistra XR,ZolpiMist or MiOXSYS;andour inability to effectively

243、 identify and align with commercial partners outside the U.S.,or the inability of those selected partners to gain the requiredregulatory,reimbursement,and other approvals needed to enable commercial success of MiOXSYS.We have limited experience selling our current products as they were acquired from

244、 other companies or were recently approved for sale.As aresult,we may be unable to successfully commercialize our products and product candidates.Despite our managements extensive experience in launching and managing commercial-stage healthcare companies,we have limited marketing,sales anddistributi

245、on experience with our current products.Our ability to achieve profitability depends on attracting and retaining customers for our current products,andbuilding brand loyalty for Natesto,Tuzistra XR,ZolpiMist,and MiOXSYS.To successfully perform sales,marketing,distribution and customer support functi

246、ons,wewill face a number of risks,including:our ability to attract and retain skilled support team,marketing staff and sales force necessary to increase the market for our approved products andto maintain market acceptance for our product candidates;the ability of our sales and marketing team to ide

247、ntify and penetrate the potential customer base;and the difficulty of establishing brand recognition and loyalty for our products.15EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.In addition,we may seek to enlist one or more third parties to assist with sales,distributi

248、on and customer support globally or in certain regions of the world.If we do seek to enter into these arrangements,we may not be successful in attracting desirable sales and distribution partners,or we may not be able to enterinto these arrangements on favorable terms,or at all.If our sales and mark

249、eting efforts,or those of any third-party sales and distribution partners,are notsuccessful,our currently approved products may not achieve increased market acceptance and our product candidates may not gain market acceptance,whichwould materially impact our business and operations.We cannot be cert

250、ain that we will be able to obtain regulatory approval for,or successfully commercialize,any of our current or future productcandidates.We may not be able to develop our current or any future product candidates.Our product candidates will require substantial additional clinical development,testing,a

251、nd regulatory approval before we are permitted to commence commercialization.The clinical trials of our product candidates are,and the manufacturingand marketing of our product candidates will be,subject to extensive and rigorous review and regulation by numerous government authorities in the U.S.an

252、d inother countries where we intend to test and,if approved,market any product candidate.Before obtaining regulatory approvals for the commercial sale of anyproduct candidate,we must demonstrate through pre-clinical testing and clinical trials that the product candidate is safe and effective for use

253、 in each targetindication.This process can take many years and may include post-marketing studies and surveillance,which will require the expenditure of substantial resources.Of the large number of drugs in development in the U.S.,only a small percentage successfully completes the FDA regulatory app

254、roval process and iscommercialized.Accordingly,even if we are able to obtain the requisite financing to continue to fund our development and clinical programs,we cannot assureyou that any of our product candidates will be successfully developed or commercialized.We are not permitted to market a prod

255、uct in the U.S.until we receive approval of a New Drug Application,or an NDA,for that product from the FDA,or inany foreign countries until we receive the requisite approval from such countries.Obtaining approval of an NDA is a complex,lengthy,expensive and uncertainprocess,and the FDA may delay,lim

256、it or deny approval of any product candidate for many reasons,including,among others:we may not be able to demonstrate that a product candidate is safe and effective to the satisfaction of the FDA;the results of our clinical trials may not meet the level of statistical or clinical significance requi

257、red by the FDA for marketing approval;the FDA may disagree with the number,design,size,conduct or implementation of our clinical trials;the FDA may require that we conduct additional clinical trials;the FDA may not approve the formulation,labeling or specifications of any product candidate;the clini

258、cal research organizations,or CROs,that we retain to conduct our clinical trials may take actions outside of our control that materiallyadversely impact our clinical trials;the FDA may find the data from pre-clinical studies and clinical trials insufficient to demonstrate that a product candidates c

259、linical and otherbenefits outweigh its safety risks,such as the risk of drug abuse by patients or the public in general;the FDA may disagree with our interpretation of data from our pre-clinical studies and clinical trials;the FDA may not accept data generated at our clinical trial sites;if an NDA,i

260、f and when submitted,is reviewed by an advisory committee,the FDA may have difficulties scheduling an advisory committeemeeting in a timely manner or the advisory committee may recommend against approval of our application or may recommend that the FDArequire,as a condition of approval,additional pr

261、e-clinical studies or clinical trials,limitations on approved labeling or distribution and userestrictions;the FDA may require development of a Risk Evaluation and Mitigation Strategy,or REMS,as a condition of approval or post-approval;the FDA may not approve the manufacturing processes or facilitie

262、s of third-party manufacturers with which we contract;orthe FDA may change its approval policies or adopt new regulations.These same risks apply to applicable foreign regulatory agencies from which we may seek approval for any of our product candidates.Any of these factors,many of which are beyond o

263、ur control,could jeopardize our ability to obtain regulatory approval for and successfully market any productcandidate.Moreover,because a substantial portion of our business is or may be dependent upon our product candidates,any such setback in our pursuit of initialor additional regulatory approval

264、 would have a material adverse effect on our business and prospects.If we fail to successfully acquire new products,we may lose market position.Acquiring new products is an important factor in our planned sales growth,including products that already have been developed and found marketacceptance.If

265、we fail to identify existing or emerging consumer markets and trends and to acquire new products,we will not develop a strong revenue source tohelp pay for our development activities as well as possible acquisitions.This failure would delay implementation of our business plan,which could have a nega

266、tiveadverse effect on our business and prospects.16EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.If we do not secure collaborations with strategic partners to test,commercialize and manufacture product candidates,we may not be able tosuccessfully develop products and g

267、enerate meaningful revenues.We may enter into collaborations with third parties to conduct clinical testing,as well as to commercialize and manufacture our products and productcandidates.If we are able to identify and reach an agreement with one or more collaborators,our ability to generate revenues

268、 from these arrangements willdepend on our collaborators abilities to successfully perform the functions assigned to them in these arrangements.Collaboration agreements typically call formilestone payments that depend on successful demonstration of efficacy and safety,obtaining regulatory approvals,

269、and clinical trial results.Collaborationrevenues are not guaranteed,even when efficacy and safety are demonstrated.Further,the economic environment at any given time may result in potentialcollaborators electing to reduce their external spending,which may prevent us from developing our product candi

270、dates.Even if we succeed in securing collaborators,the collaborators may fail to develop or effectively commercialize our products or product candidates.Collaborations involving our product candidates pose a number of risks,including the following:collaborators may not have sufficient resources or m

271、ay decide not to devote the necessary resources due to internal constraints such as budgetlimitations,lack of human resources,or a change in strategic focus;collaborators may believe our intellectual property is not valid or is unenforceable or the product candidate infringes on the intellectual pro

272、pertyrights of others;collaborators may dispute their responsibility to conduct development and commercialization activities pursuant to the applicable collaboration,including the payment of related costs or the division of any revenues;collaborators may decide to pursue a competitive product develo

273、ped outside of the collaboration arrangement;collaborators may not be able to obtain,or believe they cannot obtain,the necessary regulatory approvals;collaborators may delay the development or commercialization of our product candidates in favor of developing or commercializing their own oranother p

274、artys product candidate;orcollaborators may decide to terminate or not to renew the collaboration for these or other reasons.As a result,collaboration agreements may not lead to development or commercialization of our product candidates in the most efficient manner or at all.Forexample,our former co

275、llaborator that licensed our former product candidate,Zertane conducted clinical trials which we believe demonstrated efficacy in treatingPE,but the collaborator undertook a merger that we believe altered its strategic focus and thereafter terminated the collaboration agreement.The Merger alsocreate

276、d a potential conflict with a principal customer of the acquired company,which sells a product to treat premature ejaculation in certain European markets.Collaboration agreements are generally terminable without cause on short notice.Once a collaboration agreement is signed,it may not lead tocommerc

277、ialization of a product candidate.We also face competition in seeking out collaborators.If we are unable to secure collaborations that achieve thecollaborators objectives and meet our expectations,we may be unable to advance our products or product candidates and may not generate meaningfulrevenues.

278、We or our strategic partners may choose not to continue an existing product or choose not to develop a product candidate at any time duringdevelopment,which would reduce or eliminate our potential return on investment for that product.At any time and for any reason,we or our strategic partners may d

279、ecide to discontinue the development or commercialization of a product or productcandidate.If we terminate a program in which we have invested significant resources,we will reduce the return,or not receive any return,on our investment andwe will have missed the opportunity to have allocated those re

280、sources to potentially more productive uses.If one of our strategic partners terminates a program,we will not receive any future milestone payments or royalties relating to that program under our agreement with that party.As an example,we sold Primsol inMarch 2017,and abandoned Fiera and ProstaScint

281、 in June 2018.Our pre-commercial product candidates are expected to undergo clinical trials that are time-consuming and expensive,the outcomes of whichare unpredictable,and for which there is a high risk of failure.If clinical trials of our product candidates fail to satisfactorily demonstrate safet

282、y andefficacy to the FDA and other regulators,we or our collaborators may incur additional costs or experience delays in completing,or ultimately beunable to complete,the development and commercialization of these product candidates.Pre-clinical testing and clinical trials are long,expensive and unp

283、redictable processes that can be subject to extensive delays.We cannot guarantee that anyclinical studies will be conducted as planned or completed on schedule,if at all.It may take several years to complete the pre-clinical testing and clinicaldevelopment necessary to commercialize a drug,and delay

284、s or failure can occur at any stage.Interim results of clinical trials do not necessarily predict finalresults,and success in pre-clinical testing and early clinical trials does not ensure that later clinical trials will be successful.A number of companies in thepharmaceutical and biotechnology indu

285、stries have suffered significant setbacks in advanced clinical trials even after promising results in earlier trials and wecannot be certain that we will not face similar setbacks.The design of a clinical trial can determine whether its results will support approval of a product and flawsin the desi

286、gn of a clinical trial may not become apparent until the clinical trial is well advanced.An unfavorable outcome in one or more trials would be a majorset-back for that product candidate and for us.Due to our limited financial resources,an unfavorable outcome in one or more trials may require us to d

287、elay,reducethe scope of,or eliminate one or more product development programs,which could have a material adverse effect on our business,prospects and financialcondition and on the value of our common stock.17EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.In connection

288、with clinical testing and trials,we face a number of risks,including:a product candidate is ineffective,inferior to existing approved medicines,unacceptably toxic,or has unacceptable side effects;patients may die or suffer other adverse effects for reasons that may or may not be related to the produ

289、ct candidate being tested;the results may not confirm the positive results of earlier testing or trials;andthe results may not meet the level of statistical significance required by the FDA or other regulatory agencies to establish the safety and efficacy ofthe product candidate.If we do not success

290、fully complete pre-clinical and clinical development,we will be unable to market and sell products derived from our product candidatesand generate revenues.Even if we do successfully complete clinical trials,those results are not necessarily predictive of results of additional trials that may beneed

291、ed before an NDA may be submitted to the FDA.Although there are a large number of drugs in development in the U.S.and other countries,only a smallpercentage result in the submission of an NDA to the FDA,even fewer are approved for commercialization,and only a small number achieve widespreadphysician

292、 and consumer acceptance following regulatory approval.If our clinical trials are substantially delayed or fail to prove the safety and effectiveness of ourproduct candidates in development,we may not receive regulatory approval of any of these product candidates and our business,prospects and finan

293、cialcondition will be materially harmed.Delays,suspensions and terminations in any clinical trial we undertake could result in increased costs to us and delay or prevent our ability togenerate revenues.Human clinical trials are very expensive,time-consuming,and difficult to design,implement and comp

294、lete.Should we undertake the development of apharmaceutical product candidate,we would expect the necessary clinical trials to take up to 24 months to complete,but the completion of trials for any productcandidates may be delayed for a variety of reasons,including delays in:demonstrating sufficient

295、safety and efficacy to obtain regulatory approval to commence a clinical trial;reaching agreement on acceptable terms with prospective CROs and clinical trial sites;validating test methods to support quality testing of the drug substance and drug product;obtaining sufficient quantities of the drug s

296、ubstance or device parts;manufacturing sufficient quantities of a product candidate;obtaining approval of an IND from the FDA;obtaining institutional review board approval to conduct a clinical trial at a prospective clinical trial site;determining dosing and clinical design and making related adjus

297、tments;andpatient enrollment,which is a function of many factors,including the size of the patient population,the nature of the protocol,the proximity ofpatients to clinical trial sites,the availability of effective treatments for the relevant disease and the eligibility criteria for the clinical tr

298、ial.The commencement and completion of clinical trials for our product candidates may be delayed,suspended or terminated due to a number of factors,including:lack of effectiveness of product candidates during clinical trials;adverse events,safety issues or side effects relating to the product candid

299、ates or their formulation or design;inability to raise additional capital in sufficient amounts to continue clinical trials or development programs,which are very expensive;the need to sequence clinical trials as opposed to conducting them concomitantly in order to conserve resources;our inability t

300、o enter into collaborations relating to the development and commercialization of our product candidates;failure by us or our collaborators to conduct clinical trials in accordance with regulatory requirements;our inability or the inability of our collaborators to manufacture or obtain from third par

301、ties materials sufficient for use in pre-clinical studies andclinical trials;governmental or regulatory delays and changes in regulatory requirements,policy and guidelines,including mandated changes in the scope ordesign of clinical trials or requests for supplemental information with respect to cli

302、nical trial results;failure of our collaborators to advance our product candidates through clinical development;delays in patient enrollment,variability in the number and types of patients available for clinical trials,and lower-than anticipated retention rates forpatients in clinical trials;difficu

303、lty in patient monitoring and data collection due to failure of patients to maintain contact after treatment;a regional disturbance where we or our collaborative partners are enrolling patients in our clinical trials,such as a pandemic,terrorist activities orwar,or a natural disaster;andvarying inte

304、rpretations of our data,and regulatory commitments and requirements by the FDA and similar foreign regulatory agencies.18EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.Many of these factors may also ultimately lead to denial of an NDA for a product candidate.If we exper

305、ience delays,suspensions or terminations in aclinical trial,the commercial prospects for the related product candidate will be harmed,and our ability to generate product revenues will be delayed.In addition,we may encounter delays or product candidate rejections based on new governmental regulations

306、,future legislative or administrative actions,orchanges in FDA policy or interpretation during the period of product development.If we obtain required regulatory approvals,such approvals may later bewithdrawn.Delays or failures in obtaining regulatory approvals may result in:varying interpretations

307、of data and commitments by the FDA and similar foreign regulatory agencies;anddiminishment of any competitive advantages that such product candidates may have or attain.Furthermore,if we fail to comply with applicable FDA and other regulatory requirements at any stage during this regulatory process,

308、we may encounter orbe subject to:diminishment of any competitive advantages that such product candidates may have or attain;delays or termination in clinical trials or commercialization;refusal by the FDA or similar foreign regulatory agencies to review pending applications or supplements to approve

309、d applications;product recalls or seizures;suspension of manufacturing;withdrawals of previously approved marketing applications;andfines,civil penalties,and criminal prosecutions.The medical device regulatory clearance or approval process is expensive,time consuming and uncertain,and the failure to

310、 obtain and maintainrequired clearances or approvals could prevent us from broadly commercializing the MiOXSYS System for clinical use.The MiOXSYS System is subject to 510k de novo clearance by the FDA prior to its marketing for commercial use in the U.S.,and to regulatory approvalsbeyond CE marking

311、 required by certain foreign governmental entities prior to its marketing outside the U.S.In addition,any changes or modifications to a devicethat has received regulatory clearance or approval that could significantly affect its safety or effectiveness,or would constitute a major change in its inten

312、ded use,may require the submission of a new application for 510k de novo clearance,pre-market approval,or foreign regulatory approvals.The 510k de novo clearanceand pre-market approval processes,as well as the process of obtaining foreign approvals,can be expensive,time consuming and uncertain.It ge

313、nerally takesfrom four to twelve months from submission to obtain 510k de novo clearance,and from one to three years from submission to obtain pre-market approval;however,it may take longer,and 510k de novo clearance or pre-market approval may never be obtained.We have limited experience in filing F

314、DA applicationsfor 510k de novo clearance and pre-market approval.In addition,we are required to continue to comply with applicable FDA and other regulatory requirementseven after obtaining clearance or approval.There can be no assurance that we will obtain or maintain any required clearance or appr

315、oval on a timely basis,or atall.Any failure to obtain or any material delay in obtaining FDA clearance or any failure to maintain compliance with FDA regulatory requirements could harm ourbusiness,financial condition and results of operations.The approval process for pharmaceutical and medical devic

316、e products outside the U.S.varies among countries and may limit our ability todevelop,manufacture and sell our products internationally.Failure to obtain marketing approval in international jurisdictions would prevent ourproduct candidates from being marketed abroad.In order to market and sell our p

317、roducts in the European Union and many other jurisdictions,we,and our collaborators,must obtain separate marketingapprovals and comply with numerous and varying regulatory requirements.The approval procedure varies among countries and may involve additional testing.Wemay conduct clinical trials for,

318、and seek regulatory approval to market,our product candidates in countries other than the U.S.Depending on the results of clinicaltrials and the process for obtaining regulatory approvals in other countries,we may decide to first seek regulatory approvals of a product candidate in countriesother tha

319、n the U.S.,or we may simultaneously seek regulatory approvals in the U.S.and other countries.If we or our collaborators seek marketing approval for aproduct candidate outside the U.S.,we will be subject to the regulatory requirements of health authorities in each country in which we seek approval.Wi

320、th respectto marketing authorizations in Europe,we will be required to submit a European Marketing Authorisation Application,or MAA,to the European Medicines Agency,or EMA,which conducts a validation and scientific approval process in evaluating a product for safety and efficacy.The approval procedu

321、re varies among regionsand countries and may involve additional testing,and the time required to obtain approval may differ from that required to obtain FDA approval.19EDGAR Stream is a copyright of Issuer Direct Corporation,all rights reserved.Obtaining regulatory approvals from health authorities

322、in countries outside the U.S.is likely to subject us to all of the risks associated with obtaining FDAapproval described above.In addition,marketing approval by the FDA does not ensure approval by the health authorities of any other country,and approval byforeign health authorities does not ensure m

323、arketing approval by the FDA.Even if we,or our collaborators,obtain marketing approvals for our product candidates,the terms of approvals and ongoing regulation of ourproducts may limit how we or they market our products,which could materially impair our ability to generate revenue.Even if we receiv

324、e regulatory approval for a product candidate,this approval may carry conditions that limit the market for the product or put the product at acompetitive disadvantage relative to alternative therapies.For instance,a regulatory approval may limit the indicated uses for which we can market a product o

325、rthe patient population that may utilize the product,or may be required to carry a warning in its labeling and on its packaging.Products with black box warnings aresubject to more restrictive advertising regulations than products without such warnings.These restrictions could make it more difficult

326、to market any productcandidate effectively.Accordingly,assuming we,or our collaborators,receive marketing approval for one or more of our product candidates,we,and ourcollaborators expect to continue to expend time,money and effort in all areas of regulatory compliance.Any of our products and produc

327、t candidates for which we,or our collaborators,obtain marketing approval in the future could be subject to post-marketing restrictions or withdrawal from the market and we,and our collaborators,may be subject to substantial penalties if we,or they,fail tocomply with regulatory requirements or if we,

328、or they,experience unanticipated problems with our products following approval.Any of our approved products and product candidates for which we,or our collaborators,obtain marketing approval,as well as the manufacturing processes,post approval studies and measures,labeling,advertising and promotiona

329、l activities for such products,among other things,are or will be subject to continualrequirements of and review by the FDA and other regulatory authorities.These requirements include submissions of safety and other post-marketing informationand reports,registration and listing requirements,requireme

330、nts relating to manufacturing,quality control,quality assurance and corresponding maintenance ofrecords and documents,requirements regarding the distribution of samples to physicians and recordkeeping.Even if marketing approval of a product candidate isgranted,the approval may be subject to limitati

331、ons on the indicated uses for which the product may be marketed or to the conditions of approval,including theFDA requirement to implement a REMS to ensure that the benefits of a drug outweigh its risks.The FDA may also impose requirements for costly post-marketing studies or clinical trials and sur

332、veillance to monitor the safety or efficacy of a product.TheFDA and other agencies,including the Department of Justice,closely regulate and monitor the post-approval marketing and promotion of products to ensure thatthey are manufactured,marketed and distributed only for the approved indications and

333、 in accordance with the provisions of the approved labeling.The FDAimposes stringent restrictions on manufacturers communications regarding off-label use and if we,or our collaborators,do not market any of our productcandidates for which we,or they,receive marketing approval for only their approved indications,we,or they,may be subject to warnings or enforcement action foroff-label marketing.Viola