PMGC Holdings Inc.

Risks Related to Our Financial Condition

Our financial statements have been prepared on a going-concern basis and our continued operations are in doubt.

The uncertainty about our ability to continue in operation is based on our continuing losses from operation, limited revenue and limited working capital, among other things which existed as of year-end December 31, 2023 and December 31, 2022. As of December 31, 2024 and December 31, 2023, the Company had net working capital of $4,251,867 and $3,622,091, respectively, and has an accumulated deficit of $13,269,627 and $7,023,890, respectively. Included in the accumulated deficit are losses of $6,245,737 for the year ended December 31, 2024 and $4,301,517 for the year ended December 31, 2023. Given all these facts, we are dependent on obtaining funding from operations and the sale of debt or equity to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should we be unable to continue as a going concern.

Our ability to continue as a going concern depends on the success of any future offering and receipt of additional funds through debt or equity financing and our operations. In the event we are unable to obtain such funding, we may have to delay, reduce or eliminate certain of our planned operations, including some of our research and development and/or clinical validation studies to demonstrate aesthetic improvement, reduce overall overhead expense, or divest assets. This in turn may have an adverse effect on our ability to realize the value of our assets. If we are unable to continue as a going concern, you may lose all or part of your investment.

We have incurred net losses each year since our inception, and we may not be able to achieve or maintain profitability in the future. We incurred net losses of $6,245,737 and $4,301,517, for the years ended December 31, 2024 and 2023, respectively. Our expenses will likely increase in the future and may be more costly than we expect and may not result in increased revenue or growth in our business. These offerings may require significant capital investments and recurring costs, maintenance, depreciation, asset life and asset replacement costs, and if we are not able to maintain sufficient levels of utilization of such assets or such offerings are otherwise not successful, our investments may not generate sufficient returns and our financial condition may be adversely affected. Any failure to increase our revenue sufficiently to keep pace with our investments and other expenses could prevent us from achieving or maintaining profitability or positive cash flow on a consistent basis. If we are unable to successfully address these risks and challenges as we encounter them, our business, financial condition, results of operations and prospects could be adversely affected. If we are unable to generate adequate revenue growth and manage our expenses, we may continue to incur significant losses in the future and may not be able to achieve or maintain profitability.

Our current growth may not be indicative of our future growth and, if we begin to grow rapidly, we may not be able to effectively manage our growth or evaluate our future prospects. If we fail to effectively manage our future growth or evaluate our future prospects, our business could be adversely affected.

We have experienced minimal growth since our launch in 2020. For example, our revenue increased from nil in 2020 to $827 in 2021, to $766,277 in 2022, to $1,712,595 in 2023, and increased to $2,467,298 for the year ended December 31, 2024. Moreover, the number of our full-time employees increased as of December 31, 2024. As of the date of this Annual Report, we have two (2) full time employees and one part-time employee. This growth has placed significant demands on our management, financial, operational, technological and other resources. The anticipated growth and expansion of our business depends on a number of factors, including our ability to:

Such growth and expansion of our business will place significant demands on our management and operations teams and require significant additional resources, financial and otherwise, to meet our needs, which may not be available in a cost-effective manner, or at all. We expect to continue to expend substantial resources on:

These investments may not result in the growth of our business. Even if these investments do result in the growth of our business, if we do not effectively manage our growth, we may not be able to execute on our business plan, respond to competitive pressures, take advantage of market opportunities, satisfy our client requirements or maintain high-quality product offerings, any of which could adversely affect our business, financial condition, results of operations and prospects. You should not rely on our historical rate of revenue growth as an indication of our future performance or the rate of growth we may experience in any new category or internationally.

In addition, to support continued growth, we must effectively integrate, develop and motivate a large number of new employees while maintaining our corporate culture. We face significant competition for personnel. To attract top talent, we have had to offer, and expect to continue to offer, competitive compensation and benefits packages before we can validate the productivity of new employees. We may also need to increase our employee compensation levels to remain competitive in attracting and retaining talented employees. The risks associated with a rapidly growing workforce will be particularly acute as we choose to expand into new product categories and global markets. Additionally, we may not be able to hire new employees quickly enough to meet our needs. If we fail to effectively manage our hiring needs or successfully integrate new hires, our efficiency, ability to meet forecasts and employee morale, productivity and retention could suffer, which could have an adverse effect on our business, financial condition, results of operations and prospects.

We are also required to manage numerous relationships with various vendors and other third parties. Further growth of our operations, client base, or internal controls and procedures may not be adequate to support our operations. If we are unable to manage the growth of our organization effectively, our business, financial condition, results of operations and prospects may be adversely affected.

We will need additional capital to conduct our operations and develop our products and our ability to obtain the necessary funding is uncertain.

During the years ended December 31, 2024, and December 31, 2023 we used a significant amount of cash to finance our continued operations, and we need to obtain significant additional capital resources in order to develop products going forward. We may not be successful in maintaining our normal operating cash flow and the timing of our capital expenditures may not result in cash flows sufficient to sustain our operations through the next twelve months. If financing is not sufficient and additional financing is not available or available only on terms that are detrimental to our long-term survival, it could have a major adverse effect on our ability to pursue our clinical research and product development programs and could ultimately affect our ability to continue to function. The timing and degree of any future capital requirements and our ability to meet such capital requirements in a timely manner, on favorable terms or at all will depend on many factors, including:

Additional financing through strategic collaborations, public or private equity or debt financings or other financing sources may not be available on acceptable terms, or at all. Additional equity financing could result in significant dilution to our stockholders, and any debt financings will likely involve covenants restricting our business activities. Additional financing may not be available on acceptable terms, or at all. Further, if we obtain additional funds through arrangements with collaborative partners, these arrangements may require us to relinquish rights to some of our technologies, pipeline product or products that we might otherwise seek to develop and commercialize on our own. If sufficient capital is not available, we may be required to delay, reduce the scope of or eliminate one or more of our research or product development initiatives, any of which could have a material adverse effect on our financial condition or business prospects.

Risks Related to Our Business, Our Portfolio Companies, and the Biotechnology Industry

Our acquired technologies and products under development could be rendered obsolete by technological, regulatory, or medical advances.

The biotechnology industry is highly competitive and rapidly evolving. The technologies and product candidates developed by our portfolio companies may become obsolete or uneconomical due to advancements in scientific research, new treatment modalities, disruptive innovations, or competitive products that better or more cost-effectively address the conditions our assets aim to target.

Competitors, including well-funded pharmaceutical and biotechnology companies, academic institutions, and research organizations, may develop more effective, safer, or commercially viable solutions, rendering the technologies we acquire or invest in less attractive or non-competitive. Additionally, shifts in regulatory frameworks or treatment paradigms could impact the viability of certain products in our portfolio.

To mitigate these risks, we focus on acquiring intellectual property rights, including patents and proprietary technologies, to safeguard competitive advantages. However, there is no guarantee that our patents will be sufficient to prevent competitors from developing similar or superior solutions. Furthermore, if our portfolio companies fail to innovate or adapt to industry advancements, the commercial potential of their technologies may diminish, negatively affecting our business, financial condition, and long-term growth strategy.

To sustain our continued growth, we will need to increase the size of our organization, and we may encounter difficulties managing our growth, which could adversely affect our results of operations.

We may experience growth in the number of our employees and the scope of our operations. To that extent, the resulting growth and expansion of our sales force will place a significant demand on our financial, managerial and operational resources. We may not be able to accurately forecast the number of employees required, the timing of their hire or the associated costs with our expansion and/or our entrance into new markets. The extent of any expansion we may experience will be driven largely by the success of our new products. As a result, management’s ability to project the size of any such expansion and its cost to the company is limited by the following uncertainties: (i) we will not have previously sold any of the new products and the ultimate success of these new products and applications is unknown; (ii) we will be entering new markets; and (iii) the costs will be partially driven by factors that may not be fully in our control (e.g., timing of hiring, market salary rates, ability to hire new managerial and senior staff). Our success will also depend on the ability of our executive officers and senior management to continue to implement and improve our operational, information management and financial control systems to comply with the reporting requirements of the Securities Exchange Act of 1934, or the Exchange Act, and to expand, train and manage our employee base. Our inability to manage growth effectively could cause our operating costs to grow even faster than we are currently anticipating and adversely affect our results of operations.

If we are unable to secure strategic commercial partnerships, licensing agreements, funding, or other key business relationships following successful clinical results, our revenue potential may be limited.

Unlike traditional biotechnology companies that build internal sales forces, we focus on strategic pathways to commercialization, including partnerships, licensing agreements, acquisitions, and collaborations with larger pharmaceutical and biotechnology companies. Our ability to generate revenue and successfully bring products to market depends on multiple factors, including:

In addition to the risks associated with clinical and regulatory success, our business strategy is dependent on external partners who may not have aligned priorities, sufficient resources, or the willingness to enter into agreements on terms favorable to us. If we are unable to secure the necessary partnerships, licensing deals, funding, or commercialization pathways, we may struggle to generate revenue or achieve sustainable growth.

Furthermore, external factors such as macroeconomic conditions, evolving healthcare policies, investor sentiment toward the biotechnology sector, and industry competition could significantly impact our ability to successfully bring products to market. Any failure to effectively manage these risks could materially and adversely affect our financial condition, business strategy, and long-term growth prospects.

Potential business combinations and licensing agreements could require significant management attention and prove difficult to integrate, which could divert attention away from management, disrupt our normal course of business, dilute stockholder value, and adversely affect our operating results.

As a biotechnology-focused holding company, our business strategy relies heavily on acquiring, licensing, and investing in biotechnology assets, early-stage life sciences companies, and commercial-stage enterprises. Business combinations and licensing agreements involve several inherent risks, including:

Additionally, we may not realize the expected benefits of any business combination or licensing agreement if we fail to successfully integrate these businesses, optimize their research and development efforts, or effectively monetize their intellectual property. Any setbacks in evaluating, structuring, integrating, or commercializing acquired or licensed assets could have an adverse effect on our revenue, operating results, and overall strategic growth.

If we fail to cost-effectively acquire, license, or develop biotechnology assets, our business could be adversely affected.

Our success depends in part on our ability to acquire and license promising biotechnology assets, advance them through preclinical and clinical stages, and secure commercial partnerships for further development and distribution. If we fail to do so cost-effectively, our business, financial condition, and growth prospects may be adversely affected Risks related to the acquisition, licensing and development of biotechnology assets include:

Furthermore, external factors such as macroeconomic conditions, evolving healthcare policies, investor sentiment toward the biotechnology sector, and industry competition could significantly impact our ability to successfully bring products to market. Any failure to effectively manage these risks could materially and adversely affect our financial condition, business strategy, and long-term growth prospects.

If we fail to secure strategic partnerships or commercialization agreements, our revenue potential may be limited.

Rather than building an internal sales force, we rely on strategic partnerships, licensing agreements, and collaborations with pharmaceutical and biotechnology companies to bring our portfolio assets to market. Our ability to generate revenue and successfully commercialize these assets depends on:

If we are unable to secure strategic partnerships or licensing agreements, we may face challenges in bringing our portfolio assets to market, which could significantly impact our revenue potential and long-term viability.

Our brand and reputation may be diminished due to intellectual property disputes, perceived scientific failures, or negative publicity, which could have an adverse effect on our business.

In the biotechnology industry, intellectual property is a critical competitive asset. Any loss of confidence in our ability to protect our intellectual property, secure regulatory approvals, or successfully develop our portfolio assets could harm our reputation and business prospects. Risks include:

If our brand reputation is damaged, it may become more difficult to attract investment, secure licensing agreements, or acquire high-value biotechnology assets, all of which could have a material adverse impact on our business.

Economic downturns, shifts in healthcare investment trends, regulatory changes, and evolving market demand for biotechnology products could negatively affect our business.

We have positioned our business as a biotechnology-focused holding company, acquiring and licensing promising life sciences technologies with the intent to develop, commercialize, or out-license them to strategic partners. The biotechnology sector is highly sensitive to economic conditions, regulatory environments, investment cycles, and shifts in healthcare and pharmaceutical spending. Changes in these areas could significantly impact our ability to execute our business strategy. Economic downturns, fluctuations in capital markets, and changing investment trends in the biotechnology sector may adversely affect our ability to secure financing, complete acquisitions, and license or commercialize our portfolio companies’ assets. Factors that could impact our business include:

A general decline in healthcare and biotechnology investments, unexpected changes in regulatory requirements, or shifts in the demand for certain therapies could adversely affect our ability to execute our growth strategy. If we fail to anticipate industry trends, secure financing, maintain strong intellectual property protections, or establish successful commercialization partnerships, our business, financial condition, and results of operations could be materially and adversely affected.

If we cannot maintain our company culture or focus on our strategic mission as we grow, our success and competitive position may be harmed.

We believe our entrepreneurial approach, scientific focus, and commitment to acquiring and developing high-value biotechnology assets have been key contributors to our success to date. As a biotechnology-focused holding company, our ability to identify promising assets, secure strategic partnerships, and drive innovation relies heavily on maintaining a strong leadership vision, a disciplined investment strategy, and a culture of transparency and scientific integrity.

As we scale our operations, pursue acquisitions, and develop the infrastructure of a public company, we may face challenges in maintaining these core principles. Factors that could negatively impact our corporate culture and strategic mission include:

If we fail to preserve our entrepreneurial mindset, maintain our disciplined approach to asset selection, or sustain a culture that fosters innovation and collaboration, our ability to compete, execute acquisitions successfully, and generate long-term shareholder value could be significantly impaired. A loss of focus on our strategic mission could adversely affect our business, financial condition, and long-term growth prospects.

If we lose key personnel or are unable to attract and retain other qualified personnel, we may be unable to execute our business plan, and our business could be materially adversely affected.

As of March 26, 2025, we have only two (2) full-time employees and one part-time employee. Our executive leadership and key personnel provide services to us primarily through consulting agreements. Braeden Lichti, our Founder and Chairman, serves as a non-employee consultant and plays a critical role in shaping the strategic direction of the company. Through his company, NorthStrive Companies, Inc., Braeden provides consulting services and, from time to time, funding and advisory services to support our acquisitions, corporate restructuring efforts, and overall growth strategy.

Graydon Bensler, our Chief Executive Officer and Chief Financial Officer, also serves in a non-employee capacity through his consulting agreement with us. Our business strategy relies heavily on these key individuals for capital markets expertise, merger and acquisition execution, regulatory oversight, and financial structuring.

Our success depends on our continued ability to attract, retain, and motivate highly qualified management, business development, finance, regulatory, and scientific personnel. The biotechnology and life sciences industries are highly competitive, and securing experienced professionals with the necessary expertise is challenging. In particular, our ability to successfully execute our acquisition and licensing strategy depends on retaining key executives and advisors with deep experience in biotechnology asset evaluation, intellectual property protection, clinical development, and financial structuring.

We are expanding our executive leadership team by hiring key personnel, including a new Chief Financial Officer, and we are looking to hire additional employees in positions that will support the operations of our Company and its subsidiaries. However, as part of our corporate restructuring, we also terminated our Chief Marketing Officer and Chief Commercial Officer, which may have an adverse impact on certain operational functions.

Although we maintain “key employee” insurance policies on our executive officers that would compensate us for the loss of their services, replacing critical personnel could be difficult and time-consuming. The loss of Braeden Lichti, Graydon Bensler, or other senior personnel could significantly disrupt our ability to execute our strategic business plan, impair investor confidence, and hinder capital-raising and M&A activities.

Moreover, given our reliance on non-employee consultants for executive management, we are exposed to additional risks, including:

If we fail to recruit and retain qualified personnel-particularly in finance, acquisitions, clinical development, and regulatory affairs-our ability to execute acquisitions, commercialize biotechnology assets, and achieve long-term profitability could be materially impaired. A leadership transition or prolonged vacancies in key roles could negatively affect our financial condition, business operations, and future growth.

We may be unable to accurately forecast revenue and appropriately plan our expenses in the future.

Revenue forecasting presents significant challenges as we continue to expand our biotechnology portfolio, acquire new assets, secure licensing agreements, and pursue commercial partnerships. Unlike traditional operating companies with consistent revenue streams, our revenue generation depends on various factors, including:

We base our expense levels and investment plans on revenue projections and anticipated gross margins. However, due to the unpredictable nature of the biotechnology industry, revenue realization may not align with our projections. If our assumptions prove incorrect, we may overspend on acquisitions, clinical development, or business expansion without generating the expected financial returns, adversely impacting our business, financial condition, and results of operations.

Additionally, PMGC Capital LLC, our newly established multi-strategy investment vehicle, introduces additional financial and operational risks. As we deploy capital across different asset classes, including biotechnology equities, private investments, and structured financial instruments, our ability to generate consistent returns will be influenced by market volatility, economic downturns, and sector-specific risks. If PMGC Capital LLC underperforms or fails to achieve targeted returns, it could affect our ability to allocate capital efficiently, potentially impacting the overall financial health of our holding company.

We began commercial operations in 2020 and have undergone significant strategic transitions, evolving from a single-product skincare company into a biotechnology-focused holding company with multiple subsidiaries and investment vehicles. Given our relatively short operating history at this scale, we have limited financial data available to evaluate the long-term viability and success of our business model.

Our evolving strategy presents increased risks, uncertainties, and challenges, including:

Any evaluation of our business must consider these risks, as well as the unpredictability of biotechnology asset monetization, regulatory timelines, and capital market conditions. Our limited operating history at our current scale may make it difficult for investors and stakeholders to accurately assess our future financial performance and long-term viability.

A disruption in our operations could have an adverse effect on our business.

As a biotechnology-focused holding company, we rely on a combination of licensing agreements, acquisitions, research partnerships, and strategic investments. Our operations, including those of our portfolio companies, licensors, and third-party manufacturers, are subject to various risks, including:

Since we do not manufacture or distribute physical products directly, we are dependent on third-party contract manufacturers, biotechnology partners, and pharmaceutical collaborators for the development, scaling, and commercialization of our portfolio assets. If any of these third parties face operational failures, financial distress, or regulatory setbacks, our business, financial condition, and results of operations could be negatively impacted.

Our business is at an early stage of asset development, and we may not successfully develop, License, or commercialize biotechnology assets.

As of the date of this Annual Report, we have not yet commercialized any biotechnology assets at scale, and our business model relies on acquiring, licensing, and monetizing promising biotechnology technologies rather than direct product development. Our ability to generate revenue and grow our business depends on:

Given the complexities of drug development and regulatory approvals, there is a significant risk that assets within our portfolio:

Furthermore, the success of PMGC Capital LLC, our multi-strategy investment vehicle, introduces additional financial and operational risks. If biotechnology market volatility, unsuccessful investments, or capital misallocation affect our ability to sustain operations and finance acquisitions, it could impair our long-term growth prospects.

Uncertainty in market demand, regulatory approval, and investment cycles could impact our future growth.

Unlike companies that generate revenue from direct product sales, our ability to generate consistent financial returns depends on strategic licensing, asset monetization, and investment performance. Our long-term success relies on:

If we fail to secure regulatory approvals, commercial partnerships, or licensing deals for our portfolio assets, our ability to generate meaningful revenue, sustain operations, and expand our investment portfolio may be significantly impacted. Additionally, unforeseen macroeconomic factors, public health crises, regulatory changes, or geopolitical tensions could further compound risks and limit our growth potential.

We may incur product liability or intellectual property claims that could harm our business.

As a biotechnology-focused holding company, we do not manufacture or sell physical products directly. Instead, we acquire, license, and develop biotechnology assets through our portfolio companies, many of which may engage in drug development, medical device innovation, or therapeutic biotechnology applications. These industries inherently involve significant legal, regulatory, and liability risks, including:

There is a risk that our insurance policies and our portfolio companies’ insurance policies are inadequate to cover liabilities.

Although we maintain general liability and directors’ & officers’ (D&O) insurance, these policies may not fully cover potential liabilities arising from product safety issues, regulatory penalties, or IP disputes. Additionally, some of our portfolio companies, licensees, or strategic partners may not maintain adequate insurance coverage, which could expose us to indirect liabilities. If such insurance policies are not adequate, our financial results may be adversely impacted.

We face additional business risks through our multi-strategy investment vehicle, PMGC Capital LLC, which risks may adversely impact our financial performance.

Through PMGC Capital LLC, our multi-strategy investment vehicle, we engage in public and private investments, structured financing, and biotechnology-related asset trading. These financial activities introduce additional risks, including:

Our employees, independent contractors, consultants, strategic partners, and third parties may engage in unethical misconduct, regulatory noncompliance, or other improper activities that could harm our business.

As a biotechnology-focused holding company, we rely on a network of independent consultants, advisors, licensing partners, contract research organizations (CROs), pharmaceutical collaborators, and strategic investment partners to execute our business strategy. We are exposed to the risk that these third parties, as well as our employees, independent contractors, and vendors, may engage in unethical, fraudulent, or illegal activities that could have significant regulatory, financial, and reputational consequences.

We also face the risk of abusive sales and marketing practices through our portfolio companies and licensing partners, which risks may adversely impact our financial performance. While we do not directly commercialize products, our portfolio companies and licensing partners may be involved in sales and distribution agreements that expose us to commercial compliance risks, including anti-kickback and unfair trade practices laws. Such risks may include:

Additionally, we operate in highly regulated industries, including biotechnology, pharmaceuticals, and public markets, and misconduct by third parties could include:

Because we rely on third-party contractors and partners rather than a fully integrated internal workforce, our ability to monitor compliance is inherently limited. We may not always be able to detect, deter, or prevent misconduct before it results in regulatory investigations, fines, legal proceedings against us or our portfolio companies, reputational damage, diminished investor confidence, legal costs, loss of strategic relationships with licensing partners, biotechnology startups or financial institutions, to name only some. Further, even if we are not directly responsible for unethical conduct, any association with misconduct by partners or portfolio companies could damage our reputation and negatively impact our ability to raise capital, attract strategic investors, or execute future M&A transactions.

If we are unable to detect, mitigate, or respond to unethical behavior in a timely manner, our business, financial condition, and long-term growth strategy could be significantly impacted.

Our portfolio companies’ products and technologies may fail to achieve the broad adoption necessary for commercial success, which may negatively impact our financial performance.

The commercial success of the biotechnology assets being developed by our portfolio companies and strategic partners depends on:

We cannot assure that these biotechnology assets will achieve commercial success or achieve commercial success at a level needed for our business to profit. In such cases, our financial performance may be negatively impacted. Furthermore, our ability to generate returns on acquired and licensed assets depends on their ability to differentiate from competing technologies, secure market share, and establish strong intellectual property protections. If our portfolio companies fail to achieve market acceptance, struggle with regulatory hurdles, or cannot differentiate from competing technologies, our ability to monetize our assets, secure licensing deals, and generate shareholder value may be negatively impacted.

The outcome of clinical and product testing for our portfolio companies is uncertain.

Our portfolio companies rely on clinical trials and validation studies to demonstrate the safety, efficacy, and commercial viability of their biotechnology assets. If clinical testing fails to produce positive, timely, or cost-effective results, it may hinder regulatory approvals, limit physician adoption, and reduce the likelihood of securing commercial partnerships.

Failure to achieve strong clinical outcomes could delay, prevent, or limit revenue generation, negatively impacting our ability to monetize assets, secure licensing deals, and sustain business operations. Any setbacks in clinical development could adversely affect our financial condition and long-term growth strategy.

Even if our portfolio companies’ technologies are successful, rapid advancements in biotechnology could make them obsolete.

The biotechnology and pharmaceutical industries evolve rapidly, and new discoveries could render our portfolio companies’ technologies obsolete. Even if their products demonstrate positive clinical results, adoption may be limited due to competing treatments, evolving scientific advancements, or superior alternative solutions.

Maintaining competitiveness requires continuous innovation, additional investment, and strategic adaptation. If our portfolio companies fail to keep pace with technological progress or market demands, the commercial viability of their assets-and our ability to generate revenue-could be negatively impacted, which may adversely impact our financial performance.

The high costs of manufacturing biotechnology products may negatively impact profitability.

Biotechnology products often require complex, costly manufacturing processes. If our portfolio companies fail to optimize production, scale efficiently, or negotiate favorable supply chain agreements, their profit margins may be significantly lower than competing therapies.

Even if these portfolio companies’ products achieve regulatory approval, the products must be priced competitively while covering production costs. If the portfolio companies cannot achieve cost efficiencies or command premium pricing, profitability may be limited, negatively impacting our financial performance***.***

Evolving regulations governing biotechnology, pharmaceuticals, and investments could negatively impact our business.

Our portfolio companies and investment strategies are subject to extensive government regulation, which varies across federal, state, and international markets. Changes in laws governing biotechnology, drug approvals, licensing, and investment disclosures could impact our ability to develop, acquire, or commercialize biotechnology assets. Regulatory challenges may include:

Regulatory trends show increasing scrutiny over biotechnology ingredients, drug pricing, and marketing practices, requiring us to adapt our business model, investment strategies, and licensing terms to comply with evolving laws. If regulatory changes negatively impact biotechnology valuations, investment returns, or portfolio company operations, our financial condition, business performance, and future growth prospects could be negatively affected.

Government regulations and private party actions relating to the marketing and advertising of biotechnology and pharmaceutical products may restrict, inhibit, or delay commercialization efforts.

Our portfolio companies and licensing partners are subject to strict advertising and promotional regulations governing biotechnology, pharmaceuticals, and medical devices. If a portfolio company markets or advertises a product outside of its approved indications, regulatory agencies such as the FDA, Federal Trade Commission (“FTC”), or international health authorities could issue warning letters, impose fines, or initiate enforcement actions that may result in mandatory corrective measures or product sales restrictions.

Additionally, government agencies regulate claims related to product efficacy, safety, and comparative benefits. Regulators may require robust clinical evidence to substantiate marketing claims, and failure to meet these requirements could lead to demand for claim modifications, product labeling revisions, or advertising restrictions.

If regulatory authorities impose restrictions on advertising or promotional claims, it could delay product adoption, limit revenue generation, and negatively impact commercialization efforts for our portfolio companies. Such actions could also damage investor confidence, impact licensing opportunities, and hinder our ability to monetize biotechnology assets effectively and negatively impact our financial performance.

The development and acquisition of therapeutic product candidates could expose us to significant legal and regulatory risks.

Our acquisition and development of innovative therapeutic product candidates, specifically with our lead asset, EL-22, could expose us to significant legal and regulatory risks. The development and commercialization of therapeutic product candidates, including EL-22, are subject to extensive regulation by the FDA and other regulatory authorities. The regulations govern all aspects of product development, including pre-clinical studies, clinical trials, manufacturing and marketing. Any failure to comply with the regulations might result in significant delays in product development, approval and commercialization or suspension or termination of clinical trials. Any non-compliance could lead to enforcement actions, including warning letters, fines, injunctions and withdrawal of marketing approvals.

The ability to proceed with human clinical trials for our product candidates is contingent upon receiving FDA clearance of our IND submission. If the FDA requires us to provide extensive additional data to demonstrate safety and efficacy, including without limitation, generating additional preclinical data, conducting further toxicology or pharmacology studies or addressing unforeseen issues, we may face significant delays or be unable to proceed as planned. In addition, as one of the first companies pursuing an oral myostatin formulation combined with GLP-1 receptor agonists, we may encounter heightened regulatory scrutiny. Regulators may impose unexpected conditions, mandate more extensive trials or request additional safety and efficacy data, all of which could increase our costs and delay timelines.

Any unexpected requirements or delays in the approval process could adversely impact our ability to bring EL-22, or any of our other therapeutic product candidates, to market and achieve commercial success.

We license from a third party the rights to product candidates related to the potential prevention and treatment of muscular and obesity-related conditions, and are therefore subject to the risk that we lose the license after investing substantial resources into the research and development of these product candidates.

Under a License Agreement entered into on April 30, 2024 between MOA Life Plus Co., Ltd., a South Korean corporation (“MOA”) and the Company (“License Agreement”), MOA granted the Company an exclusive license to commercialize under certain of MOA’s patent rights concerning two licensed products,: (i) a clinical stage engineered probiotic expressing myostatin and, (ii) preclinical engineered probiotic expressing dual myostatin & activin-A antigens (collectively, “Licensed Products”). If MOA terminates the License Agreement, or if we breach our obligations under the License Agreement, which include, amongst other things, using commercially reasonable efforts to develop the Licensed Products in accordance with the License Agreement, or the license expires before we can successfully commercialize a product candidate, or investment in research, development, and commercialization efforts for such product candidate(s) would be lost. Additionally, if we or MOA fail to adequately protect or informed the related intellectual property rights relating to the Licensed Products, we may not realize the perceived or potential benefits of the License Agreement.

Since we expect to continue to rely on third parties to conduct, supervise and monitor pre-clinical and clinical trials with respect to the Licensed Products, if these third parties fail to perform in a satisfactory manner and one that meets applicable regulatory, scientific and safety requirements, it may materially harm our business.

We will rely on CROs and other third parties to ensure the proper and timely conduct of our pre-clinical and clinical trials for the Licensed Products. While we establish agreements governing the activities of such CROs and other third parties, we and our partners will have limited influence over their actual performance. Nevertheless, we and our partners will be responsible for ensuring that each of our clinical trials is conducted in accordance with its protocol, and that all legal, regulatory and scientific standards are met. Our reliance on the CROs and other third parties does not relieve us of our regulatory responsibilities.

We, our partners and our CROs must comply with current Good Clinical Practices, or cGCPs, as defined by the FDA and the International Conference on Harmonization, for conducting, recording and reporting the results of preclinical studies and clinical trials, to ensure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of clinical trial participants are protected. The FDA enforces these cGCPs through periodic inspections of trial sponsors, principal investigators, and clinical trial sites. If we or our CROs fail to comply with cGCPs, the clinical data generated in our clinical trials may be deemed unreliable and the FDA or other regulators may require us to perform additional clinical trials before approving any marketing applications. Our clinical trials will require a sufficiently large number of test subjects to evaluate the safety and effectiveness of a product candidate. If our CROs fail to comply with these regulations or fail to recruit a sufficient number of patients, fail to recruit properly qualified patients or fail to properly record or maintain patient data, we may be required to repeat such clinical trials, which would delay the regulatory approval process.

Our contracted CROs will not be our employees, and we cannot control whether they devote sufficient time and resources to our clinical and nonclinical programs. These CROs may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials, or other drug development activities that could harm our competitive position. If our CROs do not successfully carry out their contractual duties or obligations, fail to meet expected deadlines, or if the quality or accuracy of the clinical data they obtain is compromised due to failing to adhere to our clinical protocols or regulatory requirements, or for any other reasons, our clinical trials may be extended, delayed or terminated, and we may not obtain regulatory approval for, or successfully commercialize our product candidates. Our financial results and the commercial prospects for such products and any product candidates we develop would be harmed, our costs could increase, and our ability to generate revenues could be delayed.

We also expect to rely on other third parties to manufacture, store and distribute drug products for any clinical trials we may conduct. Any performance failure or defect resulting from our manufacturers or distributors could delay or hinder clinical development or marketing approval of our product candidates or commercialization of our products, if approved, producing additional losses and depriving us of potential product revenue.

Because our future commercial success with respect to the Licensed Products depends on gaining regulatory approval for our products, we cannot generate revenue without obtaining approvals.

Our long-term success and generation of revenue with respect to the Licensed Products will depend upon the successful development of these product candidates from our research and development activities. Product development is very expensive and involves a high degree of risk. Only a small number of research and development programs result in the commercialization of a product. For example, the FDA indicates that approximately 70% of drugs proceed past Phase 1 studies, 33% proceed past Phase 2, and just 25%-30% proceed past Phase 3 to Phase 4 which is the final phase in the FDA review and approval process for marketing therapeutic product candidates. The process for obtaining regulatory approval to market product candidates is expensive, usually takes many years, and can vary substantially based on the type, complexity, and novelty of the product candidates involved. Our ability to generate revenue from the Licensed Products would be adversely affected if we are delayed or unable to successfully develop our products.

We cannot guarantee that any marketing application for our product candidates will be approved. If we do not obtain regulatory approval of our products or we are significantly delayed or limited in doing so, we cannot generate revenue, and we may need to significantly curtail operations.

If we are unable to successfully complete preclinical testing and clinical trials of the Licensed Products or experience significant delays in doing so, our business will be materially harmed.

We expect to invest material efforts and financial resources in the development of the Licensed Products. Our ability to generate product revenues, which we do not expect will occur for many years, if ever, will depend heavily on the successful development and eventual commercialization of the Licensed Products.

The commercial success of the Licensed Products will depend on several factors, including:

If we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully complete development of, or to successfully commercialize, the Licensed Products, which would materially harm our business. Most pharmaceutical products that do overcome the long odds of drug development and achieve commercialization still do not recoup their cost of capital. If we are unable to design and develop each drug to meet a commercial need far in the future, the approved drug may become a commercial failure and our investment in those development and commercialization efforts will have been commercially unsuccessful.

The Licensed Products may cause adverse effects or have other properties that could delay or prevent their regulatory approval or limit the scope of any approved label or market acceptance.

Adverse events (“AEs”) or serious adverse events (“SAEs”), that may be observed during clinical trials of the Licensed Products could cause us, other reviewing entities, clinical trial sites or regulatory authorities to interrupt, delay or halt such trials and could cause denial of regulatory approval. If AEs or SAEs are observed in any clinical trials of the Licensed Products, our ability to obtain regulatory approval for the Licensed Products may be negatively impacted.

Serious or unexpected side effects caused by an approved product could result in significant negative consequences, including the following:

These events could prevent us or our partners from achieving or maintaining market acceptance of the affected product and could substantially increase the costs of commercializing the Licensed Products and impair our ability to generate revenues from the commercialization of these products.

Because third parties may be developing competitive products without our knowledge, we may later learn that competitive products are superior to the Licensed Products which may force us to terminate our research efforts of one or more product candidates.

We face potential competition from companies that may be developing competitive products that are superior to one or more of the Licensed Products. If in the future, we learn of the existence of one or more competitive products, we may be required to:

Any of these events may occur after we have spent substantial sums in connection with the clinical research of one or more product candidates.

The divestiture of our Elevai Skincare business could negatively impact our operations and strategic positioning.

In January 2025, we completed the divestiture of our Elevai Skincare business as part of our strategic shift toward a biotechnology-focused holding company. While this divestiture enables us to focus on our core business of acquiring and developing biotechnology assets, it may result in operational, legal, and strategic challenges, including:

If we fail to manage this transition effectively, we may incur unforeseen costs, legal liabilities, and operational inefficiencies, which could adversely impact our financial condition, results of operations, and long-term growth prospects.

Significant political, trade, or regulatory developments in the jurisdictions in which we sell our products, such as those stemming from the change in U.S. federal administration, are difficult to predict and may have a material adverse effect on us. Similarly, changes in U.S. federal policy that affect the geopolitical landscape could give rise to circumstances outside our control that could have negative impacts on our business operations. For example, during the prior Trump administration, increased tariffs were implemented on goods imported into the U.S., particularly from China, Canada, and Mexico. On February 1, 2025, the U.S. imposed a 25% tariff on imports from Canada and Mexico, which were subsequently suspended for a period of one month, and a 10% additional tariff on imports from China. Historically, tariffs have led to increased trade and political tensions, between not only the U.S. and China, but also between the U.S. and other countries in the international community. In response to tariffs, other countries have implemented retaliatory tariffs on U.S. goods. Political tensions as a result of trade policies could reduce trade volume, investment, technological exchange, and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. Any changes in political, trade, regulatory, and economic conditions, including, but not limited to, U.S. and China trade policies, could have a material adverse effect on our financial condition or results of operations.

In January 2025, U.S. President Donald Trump issued an executive order forming a presidential working group to establish a clear regulatory framework for digital assets, and leaders in both houses of the U.S. Congress have announced a bicameral working group with the objective of passing legislation to provide regulatory clarity for the industry. Committees in both houses of the U.S. Congress have held hearings to ensure fair access to financial services, including for companies operating in the digital asset space. Additionally, President Trump and members of the U.S. Congress announced that they are studying the possibility of creating a national strategic digital asset reserve to include Bitcoin, and at least twelve states have introduced legislation to create strategic Bitcoin reserves.

While these ongoing regulatory developments appear to be positive, and we anticipate greater regulatory certainty in the future, given the difficulty of predicting the outcomes of ongoing and future regulatory actions and legislative developments, it is possible that future developments could have a material adverse effect on our business, prospects, or operations.

Our business, operations, financial position and clinical development plans and timelines, could be materially adversely affected by the continuing military action in Ukraine and the war between Israel and Hamas.

We depend on our collaborators to help us develop and test our proposed products, and our ability to develop and commercialize products may be impaired or delayed if collaborations are unsuccessful.

Our strategy for the development, product testing and commercialization of our proposed products may require entering into collaborations with corporate partners, licensors, licensees and others. We may then be dependent upon the subsequent success of these other parties in performing their respective responsibilities and the continued cooperation of our partners. Our potential collaborators may not cooperate with us or perform their obligations under our agreements with them. We cannot control the amount and timing of our collaborators’ resources that will be devoted to our research and development activities related to our collaborative agreements with them. Our collaborators may choose to pursue existing or alternative technologies in preference to those being developed in collaboration with us.

Under agreements with collaborators, we may rely significantly on such collaborators to, among other things:

Should we collaborate with others in the development and commercialization of potential products, those expected product pipeline timelines may be delayed if collaborators fail to conduct these activities in a timely manner, or at all. In addition, our potential collaborators could terminate their agreements with us, and we may not receive any development or milestone payments. If we do not achieve milestones set forth in the agreements, or if our collaborators breach or terminate their collaborative agreements with us, our business may be materially harmed.

Our reliance on the activities of our non-employee consultants, third-party vendors, and operational contractors, whose activities are not wholly within our control, may lead to delays in development of our proposed products.

As an early-stage company, we rely extensively upon and have relationships with in-house consultants and with expertise in strategy or other business matters. These consultants are not our employees and may have commitments to, or consulting or advisory contracts with, other entities that may limit their availability to us. We have limited control over the activities of these consultants and, except as otherwise required by our collaboration and consulting agreements to the extent they exist, can expect only limited amounts of their time to be dedicated to our activities. These consultants may have commitments to other commercial and non-commercial entities. We have limited control over the operations of our consultants and can expect only limited amounts of time to be dedicated to our research, development and business goals.

Certain market opportunity data and forecasts in this Annual Report were obtained from third-party sources and were not independently verified by us. We believe the estimates of market opportunity data and forecasts of market growth included in this Annual Report are reliable, but may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, our business could fail to grow at similar rates, if at all.

This Annual Report contains certain data and information that we obtained from various government and private entity publications and reports. There is no guarantee that any particular number or percentage of market participants covered by our market opportunity estimates will purchase our products at all or generate any particular level of revenue for us. While we have not independently verified the data and information contained therein and such data and information may have been collected using third-party methodologies, we believe that the data and information, including projections based on a number of assumptions, from these third-party publications and reports used in this Annual Report is reliable. Any expansion in the medical aesthetics industry on a number of factors, including the cost and perceived value associated with our product offerings and those of our competitors. Even if the markets in which we compete meet the size estimates and growth forecast in this Annual Report, our business could fail to grow at the rate we anticipate, if at all, which could adversely affect our business, financial condition, results of operations and prospects. Our growth is subject to many factors, including our success in implementing our business strategy, which is subject to many risks and uncertainties. Accordingly, the forecasts of market growth included in this Annual Report should not be taken as indicative of our future growth. For more information regarding the estimates of market opportunity and forecasts of market growth included in this Annual Report, see the section titled “Business- Market, Industry and Other Research-Based Data.”

We or our third-party vendors may experience in the future network or system failures, or service interruptions, including cybersecurity attacks, or other technology risks. Our inability to protect our systems and data against such risks could harm our business and reputation.

Our ability to operate uninterrupted and provide high levels of service depends upon the performance of our internal network, systems and related infrastructure, and those of our third-party vendors. Any significant interruptions in, or degradation of, the quality of the services, including infrastructure storage and support, that these third parties provide to us could severely harm our business and reputation and lead to the loss of customers and revenue. Our internal network, systems, and related infrastructure, in addition to the networks, systems, and related infrastructure of our third-party vendors, may be vulnerable to computer viruses and other malware that infiltrate such systems and networks, as well as physical or electronic security breaches, natural disasters, and similar disruptions. They have been and may continue to be the target of attempts to identify and exploit network and system vulnerabilities, penetrate or bypass security measures in order to interrupt or degrade the quality of the services we receive or provide, or otherwise gain unauthorized access to our networks and systems or those of our third-party vendors. These vulnerabilities or other attempts at access may result from, or be caused by, human error or technology failures, however, they may also be the product of malicious actions by third parties intending to harm our business. The methods that may be used by these third parties to cause interruptions or failures or to obtain unauthorized access to information change frequently, are difficult to detect, evolve rapidly, and are increasingly sophisticated and hard to defend against.

Although we have not experienced any security breaches or attempted security breaches and continue to invest in security measures, we cannot be certain that our defensive measures, and those employed by our third-party vendors, will be sufficient to defend against all such current and future methods.

Any actual or perceived security breach, whether experienced by us or a third-party vendor; the reporting or announcement of such an event, or reports of perceived security vulnerabilities of our systems or the systems of our third-party service providers whether accurate or not; or our failure or perceived failure to respond or remediate an event or make adequate or timely disclosures to the public, regulatory or law enforcement agencies following any such event may be material and lead to harm to our financial condition, business reputation, and prospects of future business due to, among other factors: loss of customer confidence arising from interruptions or outages, delays, failure to meet contractual obligations, and loss of data or public release of confidential data; increase regulatory scrutiny on us; compromise our trade secret and intellectual property; expose us to costly uninsured liabilities such as material fines, penalties, liquidated damages, and overall margin compression due to renegotiation of contracts on less favorable terms or loss of business; liability for claims relating to misuse of personal information in violation of contractual obligations or data privacy laws; and potential theft of our intellectual property.

A security breach could occur and persist for an extended period of time without detection. We expect that any investigation of a security breach could take a substantial amount of time, and during such time we may not necessarily know the extent of the harm or how best to remediate it, and certain errors or actions could be repeated or compounded before they are discovered and remediated, all of which could further increase the costs and consequences of such a breach. Further, detecting and remediating such incidents may require specialized expertise and there can be no assurance that we will be able to retain or hire individuals who possess, or otherwise internally develop, such expertise. Our remediation efforts therefore may not be successful. The inability to implement, maintain, and upgrade adequate safeguards could have a material and adverse impact on our business, financial condition and results of operations. Moreover, there could be public announcements regarding any data security-related incidents and any steps we take to respond to or remediate such incidents.

The occurrence of any such failure may also subject us to costly lawsuits, claims for contractual indemnities, as well as divert valuable management, research and development, information technology, and marketing resources toward addressing these issues and delay our ability to achieve our strategic initiatives. In addition, we gather, as permitted by law, non-public, personally-identifiable financial information from customers, such as names, addresses, telephone numbers, bank and credit card account numbers and financial transaction information, and the compromise of such data, which may subject us to fines and other related costs of remediation.

Our business could be negatively impacted by cybersecurity threats and other security threats and disruptions.

Because our business relies on proprietary technology and computer systems, we face certain security threats, including threats to our information technology infrastructure, attempts to gain access to our proprietary or confidential information, threats to physical security, and domestic terrorism events. Our information technology networks and related systems are critical to the operation of our business and our research and development efforts. We are also involved with information technology systems for certain third parties, which generally face similar security threats. Cybersecurity threats in particular, are persistent, evolve quickly and include, but are not limited to, computer viruses, attempts to access information, denial of service and other electronic security breaches believe that we have implemented appropriate measures and controls and invested in skilled information technology resources to appropriately identify threats and mitigate potential risks, but there can be no assurance that such actions will be sufficient to prevent disruptions to critical systems, the unauthorized release of confidential information or corruption of data. A security breach or other significant disruption involving these types of information and information technology networks and related systems could:

Any or all of the foregoing could have a material negative impact on its business, financial condition and prospects.

If our third-party suppliers, logistics, and manufacturers do not comply with ethical business practices or with applicable laws and regulations, our reputation, business, financial condition, results of operations and prospects could be harmed.

Our reputation and our clients’ willingness to purchase our products depend in part on our suppliers’, packagers’, manufacturers’, and formulators’ compliance with ethical employment practices, such as with respect to child labor, wages and benefits, forced labor, discrimination, safe and healthy working conditions, and with all legal and regulatory requirements relating to the conduct of their businesses. We do not exercise control over our suppliers, packagers, shippers, manufacturers, and formulators and cannot guarantee their compliance with ethical and lawful business practices. If our suppliers, packagers, shippers, manufacturers, or formulators fail to comply with applicable laws, regulations, safety codes, employment practices, human rights standards, quality standards, environmental standards, production practices, or other obligations, norms, or ethical standards, our reputation and brand image could be harmed, and we could be exposed to litigation, investigations, enforcement actions, monetary liability, and additional costs that would harm our reputation, business, financial condition, results of operations and prospects.

If we, or our third-party manufacturers fail to comply with environmental laws and regulations, we could become subject to fines or penalties or incur costs that could have a material adverse effect on the success of our business.

Our research and development activities and our third-party manufacturers’ and suppliers’ activities involve the controlled storage, use and disposal of hazardous materials and other hazardous compounds. We and our manufacturers and suppliers are subject to laws and regulations governing the use, manufacture, storage, handling and disposal of these hazardous materials. In some cases, these hazardous materials and various wastes resulting from their use are stored at our and our manufacturers’ facilities pending their use and disposal. We cannot eliminate the risk of contamination, which could cause an interruption of our commercialization efforts, research and development efforts, business operations and environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products. Although we believe that the safety procedures utilized by our third-party manufacturers for handling and disposing of these materials generally comply with the standards prescribed by these laws and regulations, we cannot guarantee that this is the case or eliminate the risk of accidental contamination or injury from these materials. In such an event, we may be held liable for any resulting damages and such liability could exceed our resources and state or federal or other applicable authorities may curtail our use of certain materials and/or interrupt our business operations. Furthermore, environmental laws and regulations are complex, change frequently and have tended to become more stringent. We cannot predict the impact of such changes and cannot be certain of our future compliance.

Risks Related to Our Intellectual Property

If we fail to protect or enforce our intellectual property or confidential proprietary information relating to our current and any future medical aesthetics products or medical aesthetics pipeline product, others could compete against us more directly and we may not be able to compete effectively in our market.

Our success depends in part on our ability to protect our intellectual property rights. We rely on a combination of trademarks, trade secrets, confidential proprietary information, domains, patent rights and other intellectual property rights to protect our intellectual property. We also rely on and patent applications licensed by us for the Licensed Products which we are contractually obligated to file, prosecute and maintain under our License Agreement with MOA. Patent protection is limited in time, and we may be unsuccessful in developing and commercializing a product before a patent expires and the underlying technology becomes available for commercialization by competitors, in which case our investment of substantial time and resources towards the applicable product or product candidate could be lost without the realization of the benefits we anticipated or sought.

Certain of our technology may not be subject to protection through patents, which leaves us vulnerable to theft of our technology.

Certain parts of our know-how and technology are not patentable or are trade secrets. To protect our proprietary position in such know-how and technology, we have entered and intend to require all employees, consultants, advisors and collaborators to enter into confidentiality and invention ownership agreements with us. These agreements may not provide meaningful protection for our trade secrets, know-how or other proprietary information in the event of any unauthorized use or disclosure. Further, in the absence of patent protection, competitors who independently develop substantially equivalent technology may harm our business. There can be no assurances that we will be able to enforce these agreements or alternatively, these agreements may be deemed to be unenforceable. If we cannot adequately protect or enforce our intellectual property rights, we may not be able to adequately compete, and our business and prospects could be adversely affected.

We may not be able to protect our proprietary technology, which could harm our ability to operate profitably.

The molecular biology and bioprocessing industries place considerable importance on obtaining patent and trade secret protection for new technologies, medical aesthetics products and processes. Our success will depend, to a substantial degree, on our ability to obtain and enforce patent protection for our products, preserve any trade secrets and operate without infringing the proprietary rights of others. We cannot assure you that:

Considerable research in the areas of stem cells, molecular biology and bioprocessing is being performed in countries outside of the United States, and a number of our competitors are located in those countries. The laws protecting intellectual property in some of those countries may not provide adequate protection to prevent our competitors from misappropriating our intellectual property.

If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our target markets and our business may be adversely affected.

Our registered or unregistered trademarks or trade names may be challenged, infringed, circumvented, declared generic or determined to be infringing on other marks. We may not be able to protect our rights in these trademarks and trade names, which we need in order to build name recognition with potential partners or customers in our target markets. If we are unable to establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively, and our business may be adversely affected.

If we infringe or are alleged to infringe intellectual property rights of third parties, our business could be harmed.

Our research, development and commercialization activities may infringe or otherwise violate or be alleged to infringe or otherwise violate patents owned or controlled by other parties. Additionally, a number of biotechnology companies, universities, and research institutions have filed patent applications or hold issued patents related to technologies potentially relevant to our portfolio assets. The scope and validity of these patents can be unpredictable, and we cannot determine in advance whether any claims in pending applications will be granted or how they may impact our ability to commercialize or license certain technologies. If third-party patents are found to cover technologies used in our portfolio assets, we may be unable to license these patents at a reasonable cost, if at all, or develop suitable alternatives. This could limit our ability to advance certain biotechnology assets through research, development, and commercialization.

Competitors in the field of aesthetics have developed large portfolios of patents and patent applications in fields relating to our business. Additionally, there may also be patent applications that have been filed but not published that, when issued as patents, could be asserted against us. These third parties could bring claims against us that would cause us to incur substantial expenses and, if successful against us, could cause us to pay substantial damages and/or we could be forced to stop or delay research, development, manufacturing or sales of the product or product candidate that is the subject of the suit. Further, if a patent infringement suit were brought against us, during the pendency of the litigation, we could be forced to stop or delay research, development, manufacturing or sales of the product or product candidate that is the subject of the suit. If we are unable to effectively navigate intellectual property risks, our ability to license, develop, and commercialize our biotechnology assets could also be negatively impacted.

We may employ individuals who were previously employed at universities or pharmaceutical companies, including our competitors or potential competitors. Although we try to ensure that our employees, consultants and independent contractors do not use the proprietary information or know-how of others in their work for us, and we are not currently subject to any claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information of third parties, we may in the future be subject to such claims. Litigation may be necessary to defend against these claims. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.

A third party may hold intellectual property, including patent rights that are important or necessary to the development of our future products. It may be necessary for us to use the patented or proprietary technology of third parties to commercialize our prospective products, in which case we would be required to obtain a license from these third parties. There can be no assurance that such third parties will grant us the necessary licenses on commercially reasonable terms or at all. Failure to obtain such licenses on commercially reasonable terms could limit or eliminate our ability to develop or commercialize our future product candidates, which would have a negative impact on our business and results of operations.

Risks Related to Our Capital Requirements and Finances

If we fail to generate sufficient cash flow from our operations, we will be unable to continue to develop and commercialize our products.

We expect capital outlays and operating expenditures to increase over the next several years as we expand our operations, and our commercialization, product validation studies, research and development and manufacturing activities. However, our present and future funding requirements will depend on many factors, including, among other things:

As a result of these factors, we may need to raise additional funds, and we cannot be certain that such funds will be available to us on acceptable terms when needed, if at all. In addition, if we raise additional funds through collaboration, licensing or other similar arrangements, it may be necessary to relinquish potentially valuable rights to our future products or proprietary technologies, or grant licenses on terms that are not favorable to us. If we cannot raise funds on acceptable terms, we may not be able to expand our operations, develop new products, take advantage of future opportunities or respond to competitive pressures or unanticipated customer requirements.

We cannot predict the size of future issuances or sales of our Common Stock or other equity securities, future acquisitions or capital raising activities, or the effect, if any, that such issuances or sales may have on the market price of our Common Stock. The issuance and sale of substantial amounts of Common Stock or other equity securities or announcement that such issuances and sales may occur, could adversely affect the market price of our Common Stock.

Future sales by stockholders, or the perception that such sales may occur, may depress the price of our Common Stock.

The sale or availability for sale of substantial amounts of our shares in the public market or exercise of Common Stock warrants or other derivative securities or the perception that such sales could occur, could adversely affect the market price of our Common Stock and also could impair our ability to raise capital through future offerings of our shares. As of March 26, 2025, we had 577,961 outstanding shares of Common Stock. Any decline in the price of our Common Stock may encourage short sales, which could place further downward pressure on the price of our Common Stock and may impair our ability to raise additional capital through the sale of equity securities.

The issuance of shares upon exercise of options and settlement of outstanding derivative securities may result in substantial dilution to the interests of other shareholders since these selling shareholders may ultimately convert or exercise and sell all or a portion of the full amount issuable upon exercise. If all derivative securities outstanding as of March 26, 2025, including the Warrants, were converted or exercised into shares of Common Stock, there would be approximately an additional 531,353 shares of Common Stock outstanding as a result. The issuance of these shares will have the effect of further diluting the proportionate equity interest and voting power of holders of our Common Stock.

We may not be able to continue to satisfy listing requirements of Nasdaq to maintain a listing of our Common Stock.

Our Common Stock is currently listed on Nasdaq and we must meet certain financial and liquidity criteria to maintain such listing. If we violate the maintenance requirements for continued listing of our Common Stock, our Common Stock may be delisted.

There can be no assurance that we will maintain compliance with any of the other Nasdaq continued listing requirements. If the Common Stock is delisted, it could be more difficult to buy or sell the Common Stock or to obtain accurate quotations, and the price of the shares of Common Stock could suffer a material decline. Delisting could also impair our ability to raise capital.

In addition, our Board may determine that the cost of maintaining our listing on a national securities exchange outweighs the benefits of such listing. A delisting of our Common Stock from Nasdaq may materially impair our stockholders’ ability to buy and sell our Common Stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our Common Stock. In addition, the delisting of our Common Stock could significantly impair our ability to raise capital.

We currently do not expect to declare any dividends on our Common Stock in the foreseeable future. Instead, we anticipate that all of our earnings in the foreseeable future will be used to provide working capital, to support our operations and to finance the growth and development of our business. Any determination to declare or pay dividends in the future will be at the discretion of our Board, subject to applicable laws and dependent upon a number of factors, including our earnings, capital requirements and overall financial conditions. In addition, terms of any future debt or preferred securities may further restrict our ability to pay dividends on our Common Stock. Accordingly, your only opportunity to achieve a return on your investment in our Common Stock may be if the market price of our Common Stock appreciates and you sell your shares at a profit. The market price for our Common Stock may never exceed, and may fall below, the price that you pay for such Common Stock. See “Dividend Policy.”

An investment in our securities is speculative and there can be no assurance that investors will obtain any return on their investment. Investors may be subject to substantial risks involved in an investment in the Company, including the risk of losing their entire investment.

We have relied upon cash from financing activities and in the future, we hope to rely on revenues generated from operations to fund the cash requirements of our activities. However, there can be no assurance that we will be able to generate any significant cash from our operating activities in the future. Future financing may not be available on a timely basis, in sufficient amounts or on terms acceptable to us, if at all. Any debt financing or other financing of securities senior to the Common Stock will likely include financial and other covenants that will restrict our flexibility. Any failure to comply with these covenants would have a material adverse effect on our business, prospects, financial condition and results of operations because we could lose our existing sources of funding and impair our ability to secure new sources of funding.

As a public company in the United States, we face increased legal, accounting, administrative and other costs and expenses. We are subject to the reporting requirements of the Exchange Act and the Sarbanes-Oxley Act of 2002. The Exchange Act requires, among other things, that we file annual, quarterly and current reports with respect to our business and financial condition. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting. For example, Section 404 requires that our management report on the effectiveness of our internal controls structure and procedures for financial reporting. Section 404 compliance may divert internal resources and will take a significant amount of time and effort to complete. If we fail to maintain compliance under Section 404, or if in the future management determines that our internal control over financial reporting are not effective as defined under Section 404, we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities. Furthermore, investor perceptions of our Company may suffer, and this could cause a decline in the market price of our Common Stock. Any failure of our internal control over financial reporting could have a material adverse effect on our stated results of operations and harm our reputation. If we are unable to implement these changes effectively or efficiently, it could harm our operations, financial reporting or financial results and could result in an adverse opinion on internal controls from our independent auditors. We may need to hire a number of additional employees with public accounting and disclosure experience in order to meet our ongoing obligations as a public company, particularly if we become fully subject to Section 404 and its auditor attestation requirements, which will increase costs. We expect these rules and regulations to increase our legal and financial compliance costs and to make some activities more time consuming and costly, although we are currently unable to estimate these costs with any degree of certainty. A number of those requirements will require us to carry out activities we have not done previously. Our management team and other personnel will need to devote a substantial amount of time to new compliance initiatives and to meeting the obligations that are associated with being a public company, which may divert attention from other business concerns, which could have a material adverse effect on our business, financial condition and results of operations.

New laws, regulations and standards relating to corporate governance and public disclosure may create uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time consuming.

As a public company subject to these rules and regulations, we may find it more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These factors could also make it more difficult in the future for us to attract and retain qualified members of our Board, particularly to serve on its audit committee and compensation committee, and qualified executive officers.

If there is no active public market for our Common Stock, you may be unable to sell your shares at or above your purchase price.

Although our Common Stock is listed on Nasdaq, an active trading market for our shares may not be sustained following the purchase of your Common Stock. You may be unable to sell your shares quickly or at the market price if trading in shares of our Common Stock is not active. Further, an inactive market may also impair our ability to raise capital by selling shares of our Common Stock and may impair our ability to enter into strategic partnerships or acquire companies or products by using our shares of Common Stock as consideration.

IN ADDITION TO THE ABOVE RISKS, BUSINESSES ARE OFTEN SUBJECT TO RISKS NOT FORESEEN OR FULLY APPRECIATED BY MANAGEMENT. IN REVIEWING THIS FILING, POTENTIAL INVESTORS SHOULD KEEP IN MIND THAT OTHER POSSIBLE RISKS MAY ADVERSELY IMPACT OUR BUSINESS OPERATIONS AND THE VALUE OF OUR SECURITIES.