Rafael Holdings, Inc.

Previous wording

We have not yet demonstrated our ability to successfully complete any large-scale, pivotal clinical trials, obtain regulatory approvals, manufacture a commercial scale medicine, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful commercialization of any product that might receive regulatory approval. Typically, it takes about ten to fifteen years to develop one new medicine from the time it is discovered to when it is available for treating patients. Consequently, any predictions made about our future success or viability may not be as accurate as they could be if we had a longer operating history.

Current wording

We have not yet demonstrated our ability to successfully complete any large-scale, pivotal clinical trials, obtain regulatory approvals, manufacture any medicine on a commercial scale, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful commercialization of any product that might receive regulatory approval. Typically, it takes about ten to fifteen years to develop one new medicine from the time it is discovered to when it is available for treating patients. Consequently, any predictions made about our future success or viability may not be as accurate as they could be if we had a longer operating history.

Previous wording

We hold significant cash, cash equivalents, and investments that are subject to various market risks.

Current wording

We hold cash, cash equivalents, convertible notes receivable and investments that are subject to various market risks.

Previous wording

As of July 31, 2025, we held approximately $52.8 million in cash and cash equivalents, $1.2 million in other receivables, and $0.6 million in third-party and related party receivables. Our passive interests in other entities are not currently liquid, and we cannot assure that we will be able to liquidate them when we desire, or ever. As a result of these different market risks, our holdings of cash, cash equivalents, and investments could be materially and adversely affected.

Current wording

As of July 31, 2026, we held approximately $22.1 million in cash and cash equivalents, $2.0 million in convertible notes receivable classified as available for sale and $0.8 million in investments. Our passive interests in other entities are not currently liquid, and we cannot assure that we will be able to liquidate them when we desire, or ever. As a result of these different market risks, our holdings of cash, cash equivalents, and investments could be materially and adversely affected.

Previous wording

Our future success may depend on the results of the ongoing Phase 3 trial for Trappsol®Cyclo™. If we are unable to obtain regulatory approval or successfully commercialize Trappsol®Cyclo™ or experience significant delays in doing so, our business will be materially harmed.

Current wording

Our future success will likely depend on our ability to obtain regulatory approval and successfully commercialize Trappsol®Cyclo™ (remibetadex). If we are unable to do so, or we experience significant delays in doing so, our business will be materially harmed.

Previous wording

We have invested a significant amount of capital in Cyclo and the development and clinical activity for Trappsol® Cyclo™. Our dependence on the success of Trappsol® Cyclo™ and the need for additional capital will increase if the Phase 3 trial for Trappsol®Cyclo™ is successful. Based on the independent DMC review of safety and efficacy data at the prespecified 48-week interim analysis, in June 2025, the DMC recommended to continue the trial to 96 weeks.

Current wording

We have invested a significant amount of capital in Cyclo and the development and clinical activity for Trappsol® Cyclo™. Our dependence on the success of Trappsol® Cyclo™ and the possible need for additional capital has increased following completion of the Phase 3 trial for Trappsol®Cyclo™ and the submission of our NDA on October 28, 2026. Initial top-line data were reported on September 30, 2026 from this pivotal 96-week, double-blind, placebo-controlled Phase 3 study (CTD-TCNPC-301) evaluating Trappsol® Cyclo™ (hydroxypropyl-β-cyclodextrin, IV) in 94 patients diagnosed with Niemann-Pick Disease Type C (NPC). Data from the 94-patient trial, with patients ranging in age from 3 to 70 years, indicated that Trappsol® Cyclo™ (2000 mg/kg administered intravenously every two weeks) was well-tolerated and indicated a directionally favorable treatment effect. The complete dataset has been submitted to FDA as part of the NDA and remains subject to FDA review. The Phase 3 study did not meet the primary endpoint in the overall population; a prespecified analysis in patients receiving background miglustat and/or leucine therapy demonstrated a statistically significant and, subject to FDA review of the complete data set, a potential clinically meaningful treatment benefit.

Previous wording

The success of Trappsol® Cyclo™ is beyond our control, and the drug development and regulatory approval processes could cause significant delay or prevent us from obtaining regulatory approval or commercializing Trappsol® Cyclo™ or any other product candidates. If we are is unable to develop, obtain regulatory approval for, or, if approved, successfully commercialize its product candidates, we may not be able to generate sufficient revenue to continue our business.

Current wording

The success of Trappsol® Cyclo™ is beyond our control, and the drug development and regulatory approval processes could cause significant delay or prevent us from obtaining regulatory approval or commercializing Trappsol® Cyclo™ or any other product candidates. If we are unable to develop, obtain regulatory approval for, or, if approved, successfully commercialize our product candidates, we may not be able to generate sufficient revenue to continue our business.

Previous wording

Even if we were to obtain FDA approval for Trappsol®Cyclo™ for treatment of the designated Rare Pediatric Disease NPC1, the Rare Pediatric Disease Priority Review Voucher Program may no longer be in effect or may have been revised at the time of any such approval, or we or they might not be able to capture the value of the Rare Pediatric Disease Priority Review Voucher Program even if the program is still in effect.

Current wording

Even if we were to obtain FDA approval for Trappsol®Cyclo™ for treatment of the designated Rare Pediatric Disease NPC, the Rare Pediatric Disease Priority Review Voucher Program may no longer be in effect or may have been revised at the time of any such approval, or we might not be able to capture the value of the Rare Pediatric Disease Priority Review Voucher Program even if the program is still in effect.

Previous wording

Rare pediatric disease designation by the FDA is granted in the case of serious or life-threatening diseases affecting fewer than 200,000 people in the United States in which the serious or life-threatening manifestations are primarily in individuals 18 years of age and younger. The designation provides regulatory incentives for companies to develop and market therapies that treat these conditions. The sponsor of a drug for a rare pediatric disease may be eligible for a PRV upon approval of the drug that can be used to obtain a priority review of a subsequent marketing application for a different product. The PRV may be sold or transferred an unlimited number of times. A Rare Pediatric Disease designation does not lead to faster development or regulatory review of the product, or increase the likelihood that it will receive marketing approval.

Current wording

Rare pediatric disease designation by FDA is granted in the case of serious or life-threatening diseases affecting fewer than 200,000 people in the United States in which the serious or life-threatening manifestations are primarily in individuals 18 years of age and younger. The designation provides regulatory incentives for companies to develop and market therapies that treat these conditions. The sponsor of a drug for a rare pediatric disease may be eligible for a PRV upon approval of the drug that can be used to obtain a priority review of a subsequent marketing application for a different product. The PRV may be sold or transferred an unlimited number of times. A Rare Pediatric Disease designation does not lead to faster development or regulatory review of the product, or increase the likelihood that it will receive marketing approval.

Previous wording

Even if Trappsol®Cyclo™ were to be approved, it is not certain that we would be awarded a PRV as we may no longer meet the conditions for such an award at the time of such approval, if any. Designation of a drug as a drug for a rare pediatric disease does not guarantee that an NDA or BLA for such drug will meet the eligibility criteria for a rare pediatric disease PRV at the time the application is approved. Under the FFDCA, Cyclo will need to request a rare pediatric disease priority review voucher in any original NDA it submits for Trappsol®Cyclo™. The FDA may determine that an NDA for Trappsol®Cyclo™, if it were to be submitted and approved, does not meet the eligibility criteria for a PRV at the time of any approval, including for the following reasons:

Current wording

Even if Trappsol®Cyclo™ were to be approved, it is not certain that we would be awarded a PRV as we may no longer meet the conditions for such an award at the time of such approval, if any. Designation of a drug as a drug for a rare pediatric disease does not guarantee that an NDA or BLA for such drug will meet the eligibility criteria for a rare pediatric disease PRV at the time the application is approved. Under the FFDCA, Cyclo requested a rare pediatric disease priority review voucher in its NDA for Trappsol®Cyclo™ submitted on October 28, 2026. FDA may determine that an NDA for Trappsol®Cyclo™, if approved, does not meet the eligibility criteria for a PRV at the time of any approval, including for the following reasons:

Previous wording

In addition, the FDA may revoke any PRV if the rare pediatric disease drug for which the voucher was awarded is not marketed in the U.S. within one year following the date of approval.

Current wording

In addition, FDA may revoke any PRV if the rare pediatric disease drug for which the voucher was awarded is not marketed in the U.S. within one year following the date of approval.

Previous wording

Under the current statutory sunset provisions, Congress extended the Rare Pediatric Disease Priority Review Voucher program until September 30, 2024, with new drug approvals that meet the voucher criteria effectively grandfathered through September 30, 2026. This program has been subject to criticism, including by the FDA, and it is possible that, even if we were to obtain approval for Trappsol®Cyclo™ and otherwise qualify for such a PRV, the program may no longer be in effect at the time of approval. Absent a reauthorization or other extension of the program, if an NDA for Trappsol®Cyclo™ is not approved prior to September 30, 2026 for any reason, regardless of whether it meets the criteria for a rare pediatric disease PRV, it will not be awarded a PRV because the FDA currently may not award any rare pediatric disease PRVs after that date under current law. Even if legislation is enacted that extends the date by which approval of the rare pediatric disease-designated drug must obtain approval to receive a PRV, we may not obtain approval by that date, and even if we do, we may not obtain a PRV. Moreover, any Congressional reauthorization of this program may include new or different terms or eligibility requirements, and the FDA may determine that any marketing application for Trappsol®Cyclo™, if it were to be submitted and approved, does not meet the reauthorized eligibility criteria for awarding a PRV.

Current wording

On February 3, 2026, Congress extended the rare pediatric disease PRV program until September 30, 2029. Under the February 2026 sunset provisions, after September 30, 2029, FDA may not award any rare pediatric disease PRVs unless the program is extended. In other words, even if a product candidate has received rare pediatric disease designation, if the NDA for that product candidate is not approved by FDA by September 30, 2029, no PRV will be awarded under the current sunset provisions even if all of the other requirements for a PRV had been met. Although legislation to extend and/or make permanent the rare pediatric disease priority review voucher program has been proposed, the U.S. Congress has not yet, and may never, pass a bill to further extend the sunset dates, or otherwise amend the current statutory provisions governing the awarding of PRVs after September 30, 2029. In addition, this program has been subject to criticism, including by FDA, and it is possible that, even if we were to obtain approval for Trappsol®Cyclo™ and otherwise qualify for such a PRV, the program may no longer be in effect at the time of approval. Absent a reauthorization or other extension of the program, if an NDA for Trappsol®Cyclo™ is not approved prior to September 30, 2029 for any reason, regardless of whether it meets the criteria for a rare pediatric disease PRV, it will not be awarded a PRV because the FDA currently may not award any rare pediatric disease PRVs after that date under current law. Even if legislation is enacted that extends the date by which approval of the rare pediatric disease-designated drug must obtain approval to receive a PRV, we may not obtain approval by that date, and even if we do, we may not obtain a PRV. Moreover, any Congressional reauthorization of this program may include new or different terms or eligibility requirements, and FDA may determine that any marketing application for Trappsol®Cyclo™, if approved, does not meet the reauthorized eligibility criteria for awarding a PRV.

Previous wording

We rely upon third parties for the manufacture of Trappsol® Cyclo™ and are dependent on their quality and effectiveness.

Current wording

We rely upon third parties for the manufacture, packaging, and labeling of Trappsol® Cyclo™ and are dependent on their quality and effectiveness.

Previous wording

Trappsol® Cyclo™ requires precise, high-quality manufacturing. The failure to achieve and maintain high manufacturing standards, including the failure to conform to c-GMPs (current Good Manufacturing Practices), or to detect or control anticipated or unanticipated manufacturing errors or the frequent occurrence of such errors, could result in discontinuance or delay of ongoing or planned clinical trials, delays or failures in product testing or delivery, cost overruns, product recalls or withdrawals, patient injury or death, and other problems that could seriously hurt our business. Contract drug manufacturers often encounter difficulties involving production yields, quality control and quality assurance and shortages of qualified personnel. These manufacturers are subject to stringent regulatory requirements, including the FDA’s c-GMP regulations and similar foreign laws and standards. If our contract manufacturers fail to maintain ongoing compliance at any time, the production of our product candidates could be interrupted, resulting in delays or discontinuance of our clinical trials, additional costs and loss of potential revenues.

Current wording

Trappsol® Cyclo™ requires precise, high-quality manufacturing. The failure to achieve and maintain high manufacturing, including labeling and packaging, standards, including the failure to conform to cGMPs (current Good Manufacturing Practices), or to detect or control anticipated or unanticipated manufacturing errors or the frequent occurrence of such errors, could result in discontinuance or delay of ongoing or planned clinical trials, delays or failures in product testing or delivery, cost overruns, product recalls or withdrawals, patient injury or death, and other problems that could seriously hurt our business. Contract drug manufacturers often encounter difficulties involving production yields, quality control and quality assurance and shortages of qualified personnel. These manufacturers are subject to stringent regulatory requirements, including FDA’s cGMP regulations and similar foreign laws and standards. If our contract manufacturers fail to maintain ongoing compliance at any time, the production of our product candidates could be interrupted, resulting in delays or discontinuance of our clinical trials, additional costs and loss of potential revenues.

Previous wording

We are dependent on the Cyclo management team, and our ability to advance the development, clinical testing, regulatory approval of our lead candidate, Trappsol® Cyclo™ may be materially and adversely affected if we lose them.

Current wording

We are dependent on the Cyclo management team, and our ability to advance the development, clinical testing, and regulatory approval of our lead candidate, Trappsol® Cyclo™ may be materially and adversely affected if we lose them.

Previous wording

Following consummation of the Cyclo Merger, sales of cyclodextrin products for research purposes generates a significant portion of our revenues. During the year ended July 31, 2025, one major customer from this revenue stream accounted for 25% of total revenues. Accounts receivable balances for this major customer represents 26% of total accounts receivable at July 31, 2025. We have a contract with only one of our major customers. The loss of this customer would materially decrease our revenues if we were unable to replace such customer.

Current wording

Following consummation of the Cyclo Merger, sales of cyclodextrin products for research purposes generates a significant portion of our revenues. During the year ended July 31, 2026, one major customer from this revenue stream accounted for 34% of total revenues. Accounts receivable balances for this major customer represent 14% of total accounts receivable at July 31, 2026. We have a contract with this customer, but not with any other customers for sales of cyclodextrin. The loss of this customer would materially decrease our revenues if we were unable to replace such customer.

Previous wording

Cyclo purchases the cyclodextrin products it sells as part of its legacy fine chemical business from third-party suppliers and depends on those suppliers for the cyclodextrins it uses in its Aquaplex® fine chemical business products. Cyclo is also dependent on outside manufacturers that use lyophilization techniques for its Aquaplex® fine chemical business products. Cyclo purchases substantially all of its Trappsol® fine chemical business products from bulk manufacturers and distributors in the U.S., Japan, China, and Europe. Although products are available from multiple sources, an unexpected interruption of supply, or material increases in the price of products, for any reason, such as regulatory requirements, tariffs, import restrictions, loss of certifications, power interruptions, fires, hurricanes, war or other events could have a material adverse effect on our business, results of operations, financial condition and cash flows.

Current wording

Cyclo purchases the cyclodextrin products it sells as part of its legacy fine chemical business from third-party suppliers and depends on those suppliers for the cyclodextrins it uses in its Aquaplex® fine chemical business products. Cyclo is also dependent on outside manufacturers that use lyophilization techniques for its Aquaplex® fine chemical business products. Cyclo purchases substantially all of its Trappsol® fine chemical business products from bulk manufacturers and distributors in the U.S., Japan, China, and Europe. Under the newly-enacted BIOSECURE Act, Cyclo’s API supply chains potentially could be affected if one or more of the manufacturers or distributors from which Cyclo purchases its Trappsol® fine chemical business products were in the future to be designated one of the “biotechnology companies of concern” under the law. Separately, although products are available from multiple sources, an unexpected interruption of supply, or material increases in the price of products, for any reason, such as regulatory requirements, tariffs, import restrictions, loss of certifications, power interruptions, fires, hurricanes, war or other events could have a material adverse effect on our business, results of operations, financial condition and cash flows.

Previous wording

Our Product revenues and cash flows are influenced by currency fluctuations due to the geographic diversity of our suppliers, which may have a significant impact on our financial results. As we buy inventory from foreign suppliers, the change in the value of the U.S. dollar in relation to the Euro, Yen and Yuan has an effect on our cost of inventory, and will continue to do so. We buy most of our products from outside the U.S. using U.S. dollars. Our main supplier of specialty cyclodextrins and complexes, Cyclodextrin Research & Development Laboratory, is located in Hungary and its prices are set in Euros. The cost of our bulk inventory often changes due to fluctuations in the U.S. dollar. These products currently represent a significant portion of our revenues. When we experience short-term increases in currency fluctuation or supplier price increases, we are often not able to raise our prices sufficiently to maintain our historical margins and therefore, our margins on these sales may decline. If the U.S. dollar weakens against foreign currencies, the translation of these foreign currency denominated transactions may adversely affect our results of operations and financial condition.

Current wording

Our cost of product revenues and cash flows are influenced by currency fluctuations due to the geographic diversity of our suppliers, which may have a significant impact on our financial results. As we buy inventory from foreign suppliers, the change in the value of the U.S. dollar in relation to the Euro, Yen and Yuan has an effect on our cost of inventory, and will continue to do so. We buy most of our products from outside the U.S. using U.S. dollars. Our main supplier of specialty cyclodextrins and complexes, Cyclodextrin Research & Development Laboratory, is located in Hungary and its prices are set in Euros. The cost of our bulk inventory often changes due to fluctuations in the U.S. dollar. These products currently represent a significant portion of our revenues. When we experience short-term increases in currency fluctuation or supplier price increases, we are often not able to raise our prices sufficiently to maintain our historical margins and therefore, our margins on these sales may decline. If the U.S. dollar weakens against foreign currencies, the translation of these foreign currency denominated transactions may adversely affect our results of operations and financial condition.

Previous wording

If the Pharmaceutical Companies are unable to identify suitable compounds for preclinical and clinical development, and/or are unable to successfully meet regulatory requirements or initiating clinical trials and secure regulatory approval for any such compounds, the Pharmaceutical Companies will not be able to obtain product revenue in future periods, which likely would result in significant harm to the Pharmaceutical Companies’ financial position and adversely impact the Pharmaceutical Companies’ valuation and our business.

Current wording

If the Pharmaceutical Companies are unable to identify suitable compounds for preclinical and clinical development, and/or are unable to successfully meet regulatory requirements or initiate clinical trials and secure regulatory approval for any such compounds, the Pharmaceutical Companies will not be able to obtain product revenue in future periods, which likely would result in significant harm to the Pharmaceutical Companies’ financial position and adversely impact the Pharmaceutical Companies’ valuation and our business.

Previous wording

In order to obtain FDA approval to market a new drug, the product sponsor must demonstrate the safety and efficacy of the new drug in humans to the satisfaction of the FDA. To meet these requirements, the Pharmaceutical Companies will have to conduct extensive studies, including pre-clinical studies and adequate and well-controlled clinical trials. Clinical testing is very expensive, time-consuming, and subject to uncertainty.

Current wording

In order to obtain FDA approval to market a new drug, the product sponsor must demonstrate the safety and efficacy of the new drug in humans to the satisfaction of FDA. To meet these requirements, the Pharmaceutical Companies will have to conduct extensive studies, including preclinical studies and adequate and well-controlled clinical trials. Clinical testing is very expensive, time-consuming, and subject to uncertainty.

Previous wording

Before the Pharmaceutical Companies can commence clinical trials for a product candidate, they must complete extensive nonclinical and preclinical studies that support their planned and future INDs in the United States. We cannot be certain of the timely completion or outcome of the Pharmaceutical Companies’ nonclinical and preclinical studies and cannot predict if the FDA will allow their proposed clinical programs to proceed or if the outcome of their nonclinical and preclinical studies will ultimately support further development of their programs. We also cannot be sure that the Pharmaceutical Companies will be able to submit INDs or similar applications with respect to their product candidates on the timelines we expect, if at all, and we cannot be sure that submission of IND or similar applications will result in the FDA or other regulatory authorities allowing clinical trials to begin.

Current wording

Before the Pharmaceutical Companies can commence clinical trials for a product candidate, they must complete extensive nonclinical and preclinical studies that support their planned and future INDs in the United States. We cannot be certain of the timely completion or outcome of the Pharmaceutical Companies’ nonclinical and preclinical studies and cannot predict if FDA will allow their proposed clinical programs to proceed or if the outcome of their nonclinical and preclinical studies will ultimately support further development of their programs. We also cannot be sure that the Pharmaceutical Companies will be able to submit INDs or similar foreign applications with respect to their product candidates on the timelines we expect, if at all, and we cannot be sure that submission of IND or similar foreign applications will result in FDA or comparable foreign regulatory authorities allowing clinical trials to begin.

Previous wording

In addition, disruptions caused by the COVID-19 pandemic and subsequent variants may increase the likelihood that the Pharmaceutical Companies encounter difficulties or delays in initiating, enrolling, conducting or completing any planned and ongoing nonclinical and preclinical studies and clinical trials. Any inability by the Pharmaceutical Companies to successfully initiate or complete nonclinical and preclinical studies or clinical trials could result in additional costs or impair our ability to generate revenue from future product sales of any product candidates that were thought to be on track to receive regulatory approval. In addition, if the Pharmaceutical Companies make manufacturing or formulation changes to their product candidates that already have undergone or are undergoing clinical evaluation, they may be required to or may elect to conduct additional studies to bridge modified product candidates to earlier versions. Clinical trial delays could also shorten any periods during which any marketed products have patent protection and may allow our competitors to bring products to market before we do, which could impair our ability to successfully commercialize the Pharmaceutical Companies’ product candidates and may seriously harm our business.

Current wording

In addition, disruptions caused by public health emergencies may increase the likelihood that the Pharmaceutical Companies encounter difficulties or delays in initiating, enrolling, conducting or completing any planned and ongoing nonclinical and preclinical studies and clinical trials. Any inability by the Pharmaceutical Companies to successfully initiate or complete nonclinical and preclinical studies or clinical trials could result in additional costs or impair our ability to generate revenue from future product sales of any product candidates that were thought to be on track to receive regulatory approval. In addition, if the Pharmaceutical Companies make manufacturing or formulation changes to their product candidates that already have undergone or are undergoing clinical evaluation, they may be required to or may elect to conduct additional studies to bridge modified product candidates to earlier versions. Clinical trial delays could also shorten any periods during which any marketed products have patent protection and may allow our competitors to bring products to market before we do, which could impair our ability to successfully commercialize the Pharmaceutical Companies’ product candidates and may seriously harm our business.

Previous wording

Further, conducting clinical trials in foreign countries, as the Pharmaceutical Companies may do for their product candidates, presents additional risks that may delay completion of clinical trials. These risks include the failure of patients enrolled in clinical trials in foreign countries to adhere to clinical protocols as a result of differences in healthcare services or cultural customs, the utilization of alternative standards of care in foreign countries and the failure to conduct foreign clinical trials according to standards of care that FDA considers comparable to the standards of care in the US, failure of the Pharmaceutical Companies to persuade the FDA as to the scientific robustness and clinical acceptability of the data from any such foreign clinical trials, managing additional administrative burdens associated with foreign regulatory schemes, as well as political, economic, and public health risks relevant to such foreign countries.

Current wording

Further, conducting clinical trials in foreign countries, as the Pharmaceutical Companies may do for their product candidates, presents additional risks that may delay completion of clinical trials. These risks include the failure of patients enrolled in clinical trials in foreign countries to adhere to clinical protocols as a result of differences in healthcare services or cultural customs, the utilization of alternative standards of care in foreign countries and the failure to conduct foreign clinical trials according to standards of care that FDA considers comparable to the standards of care in the US, failure of the Pharmaceutical Companies to persuade FDA as to the scientific robustness and clinical acceptability of the data from any such foreign clinical trials, managing additional administrative burdens associated with foreign regulatory schemes, as well as political, economic, and public health risks relevant to such foreign countries.

Previous wording

Moreover, principal investigators for the Pharmaceutical Companies’ clinical trials may serve as scientific advisors or consultants to the Pharmaceutical Companies from time to time and receive compensation in connection with such services. Under certain circumstances, the Pharmaceutical Companies may be required to report some of these relationships to the FDA or state authorities or comparable foreign regulatory authorities. The FDA or state authorities or comparable foreign regulatory authority may conclude that a financial relationship between the Pharmaceutical Companies and a principal investigator has created a conflict of interest or otherwise affected conduct of the study or interpretation of the study results. The FDA or comparable foreign regulatory authority may therefore question the integrity of the data generated at the applicable clinical trial site, and the utility of the clinical trial itself may be jeopardized. This could result in a delay in approval, or rejection, of marketing applications by the FDA or comparable foreign regulatory authority, as the case may be, and may ultimately lead to the denial of regulatory approval of one or more product candidates.

Current wording

Moreover, principal investigators for the Pharmaceutical Companies’ clinical trials may serve as scientific advisors or consultants to the Pharmaceutical Companies from time to time and receive compensation in connection with such services. Under certain circumstances, the Pharmaceutical Companies may be required to report some of these relationships to FDA or state authorities or comparable foreign regulatory authorities. FDA or state authorities or comparable foreign regulatory authorities may conclude that a financial relationship between the Pharmaceutical Companies and a principal investigator has created a conflict of interest or otherwise affected conduct of the study or interpretation of the study results. FDA or comparable foreign regulatory authority may therefore question the integrity of the data generated at the applicable clinical trial site, and the utility of the clinical trial itself may be jeopardized. This could result in a delay in approval, or rejection, of marketing applications by FDA or comparable foreign regulatory authority, as the case may be, and may ultimately lead to the denial of regulatory approval of one or more product candidates.

Previous wording

Delays in the completion of any preclinical studies or clinical trials of the Pharmaceutical Companies’ product candidates will increase our costs, slow down product candidate development and approval processes, and delay or potentially jeopardize our ability to commence product sales and generate product revenue from any product candidate that might receive regulatory approval. In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of a product candidate. Any delays to the Pharmaceutical Companies’ preclinical studies or clinical trials that occur as a result could shorten any period during which they may have the exclusive right to commercialize such product candidates, and their competitors may be able to bring products to market before they do, and the commercial viability of any product candidates could be significantly reduced. Any of these occurrences may harm our business, financial condition, and prospects significantly.

Current wording

Delays in the completion of any preclinical studies or clinical trials of the Pharmaceutical Companies’ product candidates will increase our costs, slow down product candidate development and approval processes, and delay or potentially jeopardize our ability to commence product sales and generate product revenue from any product candidate that might receive regulatory approval, if any. In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of a product candidate. Any delays to the Pharmaceutical Companies’ preclinical studies or clinical trials that occur as a result could shorten any period during which they may have the exclusive right to commercialize such product candidates if they were to be approved, and their competitors may be able to bring products to market before they do, and the commercial viability of any product candidates could be significantly reduced. Any of these occurrences may harm our business, financial condition, and prospects significantly.

Previous wording

The Pharmaceutical Companies or their collaborators may not be able to initiate or continue clinical trials for the Pharmaceutical Companies’ product candidates if the Pharmaceutical Companies or such collaborators are unable to locate and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or analogous regulatory authorities outside the United States.

Current wording

The Pharmaceutical Companies or their collaborators may not be able to initiate or continue clinical trials for the Pharmaceutical Companies’ product candidates if the Pharmaceutical Companies or such collaborators are unable to identify and enroll a sufficient number of eligible patients to participate in these trials as required by FDA or comparable regulatory authorities outside the United States.

Previous wording

Our or the Pharmaceutical Companies’ product candidates may cause significant adverse events, toxicities or other undesirable side effects when used alone or in combination with other approved products or investigational new drugs that may result in a safety profile that could preclude further development, prevent regulatory approval, prevent market acceptance or limit their commercial potential if regulatory approval were to be received or result in significant negative consequences.

Current wording

Our or the Pharmaceutical Companies’ product candidates may cause significant adverse events, toxicities or other undesirable side effects when used alone or in combination with other approved products or investigational new drugs that may result in a safety profile that could preclude further development, prevent regulatory approval, prevent market acceptance or limit their commercial potential if regulatory approval were to be received or result in other significant negative consequences.

Previous wording

If our or the Pharmaceutical Companies’ product candidates are associated with undesirable side effects or have unexpected characteristics in preclinical studies or clinical trials when used alone or in combination with other approved products or investigational new drugs, we or the Pharmaceutical Companies may need to interrupt, delay or abandon their development or limit development to more narrow uses or subpopulations in which the undesirable side effects or other characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective. Treatment-related side effects could also affect patient recruitment or the ability of enrolled patients to complete the trial or result in potential product liability claims. Any of these occurrences may prevent us or the Pharmaceutical Companies from securing regulatory approval or achieving or maintaining market acceptance of the affected product candidate if it were to received regulatory approval, and may adversely affect our business, financial condition, and prospects significantly.

Current wording

If our or the Pharmaceutical Companies’ product candidates are associated with undesirable side effects or have unexpected characteristics in preclinical studies or clinical trials when used alone or in combination with other approved products or investigational new drugs, we or the Pharmaceutical Companies may need to interrupt, delay or abandon their development or limit development to more narrow uses or subpopulations in which the undesirable side effects or other characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective. Treatment-related side effects could also affect patient recruitment or the ability of enrolled patients to complete the trial or result in potential product liability claims. Any of these occurrences may prevent us or the Pharmaceutical Companies from securing regulatory approval or achieving or maintaining market acceptance of the affected product candidate if it were to receive regulatory approval, and may adversely affect our business, financial condition, and prospects significantly.

Previous wording

In addition, many compounds that initially showed promise in early-stage testing have later been found to cause side effects that prevented further development of the compound. Further, we expect that certain product candidates will be used in patients that have weakened immune systems, which may exacerbate any potential side effects associated with their use. Patients treated with product candidates may also be undergoing surgical, radiation and/or chemotherapy treatments, which can cause side effects or adverse events that are unrelated to the product candidate but may still impact the risk-benefit profile of the product candidate and the success of clinical trials. The inclusion of critically ill patients in clinical trials may result in deaths or other adverse medical events due to other therapies or medications that such patients may be using or due to the gravity of such patients’ illnesses. It may be very challenging, or even impossible, for us or the Pharmaceutical Companies to demonstrate that any such deaths or other adverse events are traceable to other therapies or medications that such patients may be using or to the gravity of such patients’ illnesses, in which case the FDA or analogous regulatory authorities may attribute any such deaths or other adverse events to our or the Pharmaceutical Companies’ product candidate being studied in the clinical trial.

Current wording

In addition, many compounds that initially showed promise in early-stage testing have later been found to cause side effects that prevented further development of the compound. Further, we expect that certain product candidates will be used in patients that have weakened immune systems, which may exacerbate any potential side effects associated with their use. Patients treated with product candidates may also be undergoing surgical, radiation and/or chemotherapy treatments, which can cause side effects or adverse events that are unrelated to the product candidate but may still impact the risk-benefit profile of the product candidate and the success of clinical trials. The inclusion of critically ill patients in clinical trials may result in deaths or other adverse medical events due to other therapies or medications that such patients may be using or due to the gravity of such patients’ illnesses. It may be very challenging, or even impossible, for us or the Pharmaceutical Companies to demonstrate that any such deaths or other adverse events are traceable to other therapies or medications that such patients may be using or to the gravity of such patients’ illnesses, in which case FDA or comparable regulatory authorities may attribute any such deaths or other adverse events to our or the Pharmaceutical Companies’ product candidate being studied in the clinical trial.

Previous wording

If significant adverse events or other side effects are observed in any of our or the Pharmaceutical Companies’ current or future clinical trials, we or the Pharmaceutical Companies may have difficulty recruiting patients to the clinical trials, patients may drop out of such trials, or they may be required to abandon the trials or their development efforts of a product candidate altogether. We, the Pharmaceutical Companies, the FDA, other comparable regulatory authorities or an IRB may suspend or halt clinical trials of a product candidate at any time for various reasons, including a belief that subjects in such trials are being exposed to inadequate clinical benefit and/or unacceptable health risks or adverse side effects.

Current wording

If significant adverse events or other side effects are observed in any of our or the Pharmaceutical Companies’ current or future clinical trials, we or the Pharmaceutical Companies may have difficulty recruiting patients to the clinical trials, patients may drop out of such trials, or they may be required to amend or abandon the trials or their development efforts of a product candidate altogether. We, the Pharmaceutical Companies, FDA, other comparable regulatory authorities or an IRB may suspend or halt clinical trials of a product candidate at any time for various reasons, including a belief that subjects in such trials are being exposed to inadequate clinical benefit and/or unacceptable health risks or adverse side effects.

Previous wording

From time to time, we and/or the Pharmaceutical Companies may publicly disclose preliminary or top-line data from preclinical studies and clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following study completion and a more comprehensive review of the data related to the particular study or trial. We and/or the Pharmaceutical Companies may also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we or they may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the top-line or preliminary results reported may differ significantly from future results of the same studies, or different conclusions or considerations may qualify such results and/or limit the clinical significance and clinical conclusions that can be drawn from them, once additional data have been received and fully evaluated. Top-line data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published. Even complete data from an individual study or clinical trial may be evaluated different and result in different conclusions based upon subsequent data from a subsequently completed study. In addition, the full study results from all clinical trials are subject to FDA review, and the FDA may draw materially different conclusions than those reached by us or the Pharmaceutical Companies. As a result, top-line data should be viewed with caution until the final data are available, and then, until the full study results have been completely evaluated by the FDA.

Current wording

From time to time, we and/or the Pharmaceutical Companies may publicly disclose preliminary or top-line data from preclinical studies and clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following study completion and a more comprehensive review of the data related to the particular study or trial. We and/or the Pharmaceutical Companies may also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we or they may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the top-line or preliminary results reported may differ significantly from future results of the same studies, or different conclusions or considerations may qualify such results and/or limit the clinical significance and clinical conclusions that can be drawn from them, once additional data have been received and fully evaluated. Top-line data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published. Even complete data from an individual study or clinical trial may be evaluated differently and result in different conclusions based upon subsequent data from a subsequently completed study. In addition, the full study results from all clinical trials are subject to FDA review, and FDA may draw materially different conclusions than those reached by us or the Pharmaceutical Companies. As a result, top-line data should be viewed with caution until the final data are available, and then, until the full study results have been completely evaluated and acted upon by FDA.

Previous wording

The outcome of preclinical studies and early clinical trials may not be predictive of the success or failure of later preclinical studies or clinical trials, and interim results of preclinical studies or clinical trials do not necessarily predict success in future clinical trials. Many companies in the biopharmaceutical industry, including Cornerstone, have suffered significant setbacks in late-stage clinical trials after achieving positive results in earlier development, and the Pharmaceutical Companies could face similar setbacks. The design of a clinical trial can determine whether its results will support approval of a product, and flaws in the design of a clinical trial may not become apparent until the clinical trial is well advanced or even completed. We and the Pharmaceutical Companies have limited experience in designing clinical trials and may be unable to design and execute clinical trials to support regulatory approval. In addition, preclinical and clinical data are often susceptible to varying interpretations and analyses. Many companies that believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain regulatory approval for the product candidates. Even if we or the Pharmaceutical Companies, or future collaborators, believe that the results of clinical trials for the Pharmaceutical Companies’ product candidates warrant regulatory approval, the FDA or comparable foreign regulatory authorities may disagree and may not grant regulatory approval of the Pharmaceutical Companies’ product candidates.

Current wording

The outcome of preclinical studies and early clinical trials may not be predictive of the success or failure of later preclinical studies or clinical trials, and interim or even complete results of preclinical studies or clinical trials do not necessarily predict success in future clinical trials. Many companies in the biopharmaceutical industry, including Cornerstone, have suffered significant setbacks in late-stage clinical trials after achieving positive results in earlier development, and the Pharmaceutical Companies could face similar setbacks. The design of a clinical trial can determine whether its results will support approval of a product, and flaws in the design of a clinical trial may not become apparent until the clinical trial is well advanced or even completed. We and the Pharmaceutical Companies have limited experience in designing clinical trials and may be unable to design and execute clinical trials to support regulatory approval. In addition, preclinical and clinical data are often susceptible to varying interpretations and analyses. Many companies that believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain regulatory approval for the product candidates. Even if we or the Pharmaceutical Companies, or future collaborators, believe that the results of clinical trials for the Pharmaceutical Companies’ product candidates warrant regulatory approval, FDA or comparable foreign regulatory authorities may disagree and may not grant regulatory approval of the Pharmaceutical Companies’ product candidates.

Previous wording

The regulatory approval processes of the FDA and comparable foreign regulatory authorities are lengthy, time consuming and inherently unpredictable, and if the Pharmaceutical Companies are ultimately unable to obtain regulatory approval for their product candidates, our and their business will be substantially harmed.

Current wording

The regulatory approval processes of FDA and comparable foreign regulatory authorities are lengthy, time consuming and inherently unpredictable, and if the Pharmaceutical Companies are ultimately unable to obtain regulatory approval for their product candidates, our and their business will be substantially harmed.

Previous wording

The time required to obtain approval by the FDA and comparable foreign authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities. In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change during the course of a product candidate’s clinical development and may vary among jurisdictions. We and the Pharmaceutical Companies have not obtained regulatory approval for any product candidate, and it is possible that any product candidates they may seek to develop in the future will never obtain regulatory approval. Neither we nor the Pharmaceutical Companies nor any future collaborator is permitted to market any new drug in the United States or abroad until they receive regulatory approval of an NDA, or other comparable submission, from the FDA or foreign regulatory agencies.

Current wording

The time required to obtain approval by FDA and comparable foreign authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities. In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change during the course of a product candidate’s clinical development and may vary among jurisdictions. We and the Pharmaceutical Companies have not obtained regulatory approval for any product candidate, and it is possible that any product candidates they may seek to develop in the future will never obtain regulatory approval. Neither we nor the Pharmaceutical Companies nor any future collaborator is permitted to market any new drug in the United States or abroad until they receive regulatory approval of an NDA, or other comparable submission, from FDA or foreign regulatory agencies.

Previous wording

Prior to obtaining approval to commercialize a product candidate in the United States or abroad, the Pharmaceutical Companies or their collaborators must demonstrate with substantial evidence from, among other things, well-controlled clinical trials, and to the satisfaction of the FDA or foreign regulatory agencies, that such product candidates are safe and effective for their intended use(s). Results from nonclinical and preclinical studies and clinical trials can be interpreted in different ways. Even if we believe the nonclinical and preclinical or clinical data for the Pharmaceutical Companies’ product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities. The FDA or foreign regulatory agencies may also require the Pharmaceutical Companies to conduct additional preclinical studies or clinical trials for their product candidates either prior to or post-approval, or they may object to elements of a proposed clinical development program.

Current wording

Prior to obtaining approval to commercialize a product candidate in the United States or abroad, the Pharmaceutical Companies or their collaborators must demonstrate with substantial evidence from, among other things, well-controlled clinical trials, and to the satisfaction of FDA or comparable foreign regulatory agencies, that such product candidates are safe and effective for their intended use(s). Results from nonclinical and preclinical studies and clinical trials can be interpreted in different ways. Even if we believe the nonclinical and preclinical or clinical data for the Pharmaceutical Companies’ product candidates are promising, such data may not be sufficient to support approval by FDA and other regulatory authorities. FDA or comparable foreign regulatory agencies may also require the Pharmaceutical Companies to conduct additional preclinical studies or clinical trials for their product candidates either prior to or post-approval, or they may object to elements of a proposed clinical development program.

Previous wording

The FDA or any foreign regulatory authorities can delay, limit or deny approval of the Pharmaceutical Companies’ product candidates or require them to conduct additional nonclinical and preclinical or clinical testing or abandon a program for multiple reasons in their sole discretion, including the following:

Current wording

FDA or any foreign regulatory authorities can delay, limit or deny approval of the Pharmaceutical Companies’ product candidates or require them to conduct additional nonclinical and preclinical or clinical testing or abandon a program for multiple reasons in their sole discretion, including the following:

Previous wording

Of the large number of drugs in development, only a small percentage successfully complete the FDA or foreign regulatory approval processes and are commercialized. The lengthy approval process as well as the unpredictability of future clinical trial results may result in the Pharmaceutical Companies failing to obtain regulatory approval to market their product candidates, which would significantly harm our business, results of operations and prospects. In addition, even if the Pharmaceutical Companies were to obtain approval, regulatory authorities may approve any of their product candidates for fewer or more limited indications or less advantageous labeling than requested, may grant approval contingent on the performance of costly post-marketing clinical trials, including Phase 4 clinical trials, and/or the implementation of a REMS, which may be required to assure safe use of the drug after approval. The FDA or the applicable foreign regulatory authority also may approve a product candidate for a more limited indication or patient population than originally requested, or may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of that product candidate. Even if regulatory approval were to be secured, payors in the US responsible for coverage and reimbursement determinations and foreign authorities responsible for drug pricing determinations may not provide adequate coverage or reimbursement or approve the prices the Pharmaceutical Companies intend to charge for any approved products or those prices could be reduced based upon most-favored-nation pricing policies. Any of the foregoing scenarios could materially harm the commercial prospects for the Pharmaceutical Companies' product candidates.

Current wording

Of the large number of drugs in development, only a small percentage successfully complete FDA or foreign regulatory approval processes and are commercialized. The lengthy approval process as well as the unpredictability of future clinical trial results may result in the Pharmaceutical Companies failing to obtain regulatory approval to market their product candidates, which would significantly harm our business, results of operations and prospects. In addition, even if the Pharmaceutical Companies were to obtain approval, regulatory authorities may approve any of their product candidates for fewer or more limited indications or less advantageous labeling than requested, may grant approval contingent on the performance of costly post-marketing clinical trials, including Phase 4 clinical trials, and/or the implementation of a REMS, which may be required to assure safe use of the drug after approval. FDA or the applicable foreign regulatory authority also may approve a product candidate for a more limited indication or patient population than originally requested, or may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of that product candidate. Even if regulatory approval were to be secured, payors in the US responsible for coverage and reimbursement determinations and foreign authorities responsible for drug pricing determinations may not provide adequate coverage or reimbursement or approve the prices the Pharmaceutical Companies intend to charge for any approved products or those prices could be reduced based upon most-favored-nation pricing policies. Any of the foregoing scenarios could materially harm the commercial prospects for the Pharmaceutical Companies’ product candidates.

Previous wording

If the FDA does not conclude that certain of the Pharmaceutical Companies’ product candidates, if any, satisfy the requirements for the Section 505(b)(2) regulatory approval pathway, or if the requirements for such product candidates under Section 505(b)(2) are not as they expect, the approval pathway for those product candidates will likely take significantly longer, cost significantly more and entail significantly greater complications and risks than anticipated, and in either case may not be successful.

Current wording

If FDA does not conclude that certain of the Pharmaceutical Companies’ product candidates, if any, satisfy the requirements for the Section 505(b)(2) regulatory approval pathway, or if the requirements for such product candidates under Section 505(b)(2) are not as they expect, the approval pathway for those product candidates will likely take significantly longer, cost significantly more and entail significantly greater complications and risks than anticipated, and in either case may not be successful.

Previous wording

The Drug Price Competition and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act, added Section 505(b)(2) to the FFDCA. Section 505(b)(2) of the FFDCA permits the submission of an NDA where at least some of the information required for approval comes from studies that were not conducted by or for the applicant and for which the applicant has not obtained a right of reference. Section 505(b)(2), when applicable under the FFDCA, would allow an NDA submitted to the FDA to rely in part on data in the public domain and the FDA’s prior conclusions regarding the safety and effectiveness of a previously-approved product, which could expedite the development program for certain of the Pharmaceutical Companies’ product candidates by potentially decreasing the amount of nonclinical and preclinical and/or clinical data that they would need to generate in order to obtain FDA approval.

Current wording

The Drug Price Competition and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act, added Section 505(b)(2) to the FFDCA. Section 505(b)(2) of the FFDCA permits the submission of an NDA where at least some of the information required for approval comes from studies that were not conducted by or for the applicant and for which the applicant has not obtained a right of reference. Section 505(b)(2), when applicable under the FFDCA, would allow an NDA submitted to FDA to rely in part on data in the public domain and/or FDA’s prior conclusions regarding the safety and effectiveness of a previously-approved product, which could expedite the development program for certain of the Pharmaceutical Companies’ product candidates by potentially decreasing the amount of nonclinical and preclinical and/or clinical data that they would need to generate in order to obtain FDA approval.

Previous wording

If the FDA does not allow any of the Pharmaceutical Companies’ product candidates to pursue approval under the Section 505(b)(2) regulatory pathway as anticipated, the Pharmaceutical Companies may need to conduct additional nonclinical and preclinical studies and/or clinical trials, provide additional data and information, and meet additional standards for regulatory approval. If this were to occur, the time and financial resources required to obtain FDA approval for such product candidates, and complications and risks associated with such product candidates, would likely substantially increase. Moreover, inability to pursue approval under the Section 505(b)(2) regulatory pathway could result in new competitive products reaching the market more quickly than any product candidates the Pharmaceutical Companies are developing, which could adversely impact our and their competitive position and prospects. Even if the Pharmaceutical Companies are allowed to pursue approval under the Section 505(b)(2) regulatory pathway, we cannot assure you that any product candidates the Pharmaceutical Companies develop will receive the requisite approval for commercialization.

Current wording

If FDA does not allow any of the Pharmaceutical Companies’ product candidates to pursue approval under the Section 505(b)(2) regulatory pathway as anticipated, the Pharmaceutical Companies may need to conduct additional nonclinical and preclinical studies and/or clinical trials, provide additional data and information, and meet additional standards for regulatory approval. If this were to occur, the time and financial resources required to obtain FDA approval for such product candidates, and complications and risks associated with such product candidates, would likely substantially increase. Moreover, inability to pursue approval under the Section 505(b)(2) regulatory pathway could result in new competitive products reaching the market more quickly than any product candidates the Pharmaceutical Companies are developing, which could adversely impact our and their competitive position and prospects. Even if the Pharmaceutical Companies are allowed to pursue approval under the Section 505(b)(2) regulatory pathway, we cannot assure you that any product candidates the Pharmaceutical Companies develop will receive the requisite approval for commercialization.

Previous wording

In addition, notwithstanding the approval of a number of products by the FDA under Section 505(b)(2), certain pharmaceutical companies and others have objected to the FDA’s interpretation of Section 505(b)(2). If the FDA’s interpretation of Section 505(b)(2) is successfully challenged, either generally or in connection with a Section 505(b)(2) submission by the Pharmaceutical Companies, the FDA may change its 505(b)(2) policies and practices, which could delay or even prevent the FDA from approving any NDA that the Pharmaceutical Companies submit under Section 505(b)(2). In addition, the pharmaceutical industry is highly competitive, and Section 505(b)(2) NDAs are subject to certain requirements designed to protect the patent rights of sponsors of previously approved drugs that are referenced in a Section 505(b)(2) NDA. These requirements may give rise to patent litigation and mandatory delays in approval of the Pharmaceutical Companies NDAs for up to 30 months or longer depending on the outcome of any litigation. It also is not uncommon for a manufacturer of a previously approved product to file a citizen petition with the FDA seeking to delay approval of, or impose additional approval requirements for, pending competing products. If successful, such petitions can significantly delay, or even prevent, the approval of a new product. Even if the FDA ultimately denies such a petition, the FDA may substantially delay approval while it considers and responds to the petition. In addition, even if the Pharmaceutical Companies are able to utilize the Section 505(b)(2) regulatory pathway, there is no guarantee this would ultimately lead to streamlined product development or earlier approval.

Current wording

In addition, notwithstanding the approval of a number of products by FDA under Section 505(b)(2), certain pharmaceutical companies and others have objected to FDA’s interpretation of Section 505(b)(2). If FDA’s interpretation of Section 505(b)(2) is successfully challenged, either generally or in connection with a Section 505(b)(2) submission by the Pharmaceutical Companies, FDA may change its 505(b)(2) policies and practices, which could delay or even prevent FDA from approving any NDA that the Pharmaceutical Companies submit under Section 505(b)(2). In addition, the pharmaceutical industry is highly competitive, and Section 505(b)(2) NDAs are subject to certain requirements designed to protect the patent rights of sponsors of previously approved drugs if they are referenced in a Section 505(b)(2) NDA. These requirements may give rise to patent litigation and mandatory delays in approval of the Pharmaceutical Companies NDAs for up to 30 months or longer depending on the outcome of any litigation. It also is not uncommon for a manufacturer of a previously approved product to file a citizen petition with FDA seeking to delay approval of, or impose additional approval requirements for, pending competing products. If successful, such petitions can significantly delay, or even prevent, the approval of a new product. Even if FDA ultimately denies such a petition, FDA may substantially delay approval while it considers and responds to the petition. In addition, even if the Pharmaceutical Companies are able to utilize the Section 505(b)(2) regulatory pathway, there is no guarantee this would ultimately lead to streamlined product development or earlier approval.