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New words:
awarded, composition, concurrently, cumulative, Europe, IQVIA, mapping, member, package, refreshed, shelf, Spending, startup, variable
Removed:
conform, reclassified
Financial report summary
?Risks
- Clinical drug development involves a lengthy and expensive process with an uncertain outcome, results of earlier studies and trials may not be predictive of future trial results and ESSA’s product candidate and potential future product candidates may not have favorable results in later trials or in the commercial setting or satisfy the requirements of the FDA or non-US regulatory authorities.
- ESSA’s future success is dependent primarily on the regulatory approval for commercialization of a single product candidate, which is in the clinical development stage.
- If the Company breaches any of the agreements under which the Company licenses rights to its technology from third parties, the Company could lose license rights that are important to ESSA’s business. ESSA’s current license agreement may not provide an adequate remedy for its breach by the licensor.
- The Company may not be able to obtain required regulatory approvals for the Company’s proposed products.
- As an organization, ESSA has never submitted an NDA/NDS and may be unable to do so for any future products ESSA develops.
- ESSA may not be able to successfully commercialize its Aniten series of compounds.
- The Company’s product candidate and potential future product candidates may have undesirable side effects when used alone or in combination with other approved products or investigational new drugs that may delay or prevent marketing approval or, if approval is received, require them to be taken off the market, require them to include safety warnings or otherwise limit their sales.
- If ESSA, or any of ESSA’s partners are unable to enroll and/or maintain subjects in clinical trials, ESSA will be unable to complete its clinical development activities on a timely basis or at all.
- ESSA may conduct trials for future product candidates at sites outside the United States and the FDA may not accept data from trials conducted in such locations.
- Even if the Company obtains marketing approval for any product candidate and potential future products, the Company will be subject to ongoing obligations and continued regulatory review, which may result in significant additional expense.
- Failure to comply with applicable legal and regulatory requirements may result in administrative or judicial sanctions.
- If clinical trials for ESSA’s product candidate and potential future product candidates are prolonged, delayed or stopped, ESSA may be unable to obtain regulatory approval and commercialize such product candidates on a timely basis, or at all, which would require ESSA to incur additional costs and delay receipt of any product revenue.
- ESSA has limited experience manufacturing product candidates on a large clinical or commercial scale and has no manufacturing facility. As a result, ESSA may in the future be dependent on third-party manufacturers for the manufacture of product candidates as well as on third parties for ESSA’s supply chain, and if ESSA experiences problems with any future third parties, the manufacturing of ESSA’s product candidates or products could be delayed.
- Failure to obtain regulatory approval in international jurisdictions would prevent any product candidates from being marketed outside the United States.
- Recently enacted and future legislation may increase the difficulty and cost for the Company to obtain marketing approval of, and commercialize, its products and affect the prices the Company may obtain.
- Risks Related to ESSA’s Financial Position and Need for Additional Capital
- ESSA will have significant additional future capital needs for future clinical trials and there are uncertainties as to the Company’s ability to raise additional funding.
- ESSA may not be able to raise additional capital on favorable terms, which may result in dilution to ESSA’s existing shareholders, restrictions on ESSA’s operations or the requirement for ESSA to relinquish rights to technologies or any future product candidates.
- The Company has incurred significant losses in every quarter since its inception and anticipates that it will continue to incur significant losses in the future and may never generate profits from operations or maintain profitability.
- ESSA has a limited operating history, which may make it difficult for you to evaluate the success of ESSA’s business to date and to assess ESSA’s future viability.
- Risks Related to ESSA’s Intellectual Property
- ESSA relies on proprietary technology, the protection of which can be unpredictable and costly.
- ESSA may not be able to protect its intellectual property rights throughout the world.
- Obtaining and maintaining ESSA’s patent protection depends on compliance with various procedural, documentary, fee payment and other requirements imposed by regulations and governmental patent agencies, and ESSA’s patent protection could be reduced or eliminated for non-compliance with these requirements.
- Confidentiality Agreements with employees and third parties may not prevent unauthorized disclosure of Company proprietary information, which would harm ESSA’s competitive position.
- If ESSA’s trademarks and trade names are not adequately protected, the Company may not be able to build name recognition in its markets of interest and its business, financial condition, results of operations and prospects could be significantly harmed.
- Intellectual property litigation may lead to unfavorable publicity that harms ESSA’s reputation and causes the market price of its Common Shares to decline.
- Risks Related to ESSA’s Business and Industry
- The Company’s business and operations would suffer in the event of computer system failures or security breaches.
- Business disruptions could seriously harm ESSA’s future revenues and financial condition and increase costs and expenses.
- If the Company is not successful in attracting and retaining highly qualified personnel, the Company may not be able to successfully implement its business strategy.
- Third-party coverage and reimbursement and health care cost containment initiatives and treatment guidelines may constrain the Company’s future revenues.
- The directors and officers of ESSA may be subject to conflicts of interest.
- The Company faces intense competition from other biotechnology and pharmaceutical companies and its operating results will suffer if the Company fails to compete effectively.
- The Company may face exposure to adverse movements in foreign currency exchange rates.
- If ESSA is not able to convince public payors and hospitals to include ESSA’s products on their approved formulary lists, revenues may not meet expectations and ESSA’s business, results of operations and financial condition may be adversely affected.
- The Company has never marketed a drug before, and if the Company is unable to establish an effective sales force and marketing infrastructure, or enter into acceptable third-party sales and marketing or licensing arrangements, the Company may be unable to generate any revenue.
- The Company will need to expand the size of its organization and the Company may experience difficulties in managing this growth.
- ESSA’s product candidate and potential future products may, if approved for sale, not achieve or maintain expected levels of market acceptance, which could have a material adverse effect on its business, financial condition and results of operations and could cause the market value of its securities to decline.
- The Company may acquire businesses or products or form strategic alliances in the future and the Company may not realize the benefits of such acquisitions.
- ESSA has entered into collaborations with third parties for the development and commercialization of its lead product candidate. If those collaborations are not successful, ESSA may not be able to capitalize on the market potential of its lead product candidate.
- ESSA’s employees, independent contractors, consultants, commercial collaborators, principal investigators, CROs suppliers and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could cause significant liability for ESSA and harm ESSA’s reputation.
- If product liability lawsuits are brought against the Company or its strategic partners, it may incur substantial liabilities and may be required to cease or limit the sale, marketing and distribution of its product candidate and potential future products.
- Compulsory licensing or generic competition may affect the Company’s business in certain countries.
- ESSA incurs significantly increased costs and devotes substantial management time as a result of operating as a public company.
- ESSA is a smaller reporting company and a non-accelerated filer, and the reduced disclosure requirements available to ESSA may make ESSA’s Common Shares less attractive to investors.
- Risks Related to Additional Legal Compliance and Regulatory Matters
- ESSA is subject to risks inherent in foreign operations.
- Laws and regulations governing international operations may preclude ESSA from developing, manufacturing and selling certain product candidates outside of the United States and Canada and require ESSA to develop and implement costly compliance programs.
- ESSA is subject to U.S. laws relating to fraud and abuse and patients’ rights.
- If ESSA fails to comply with environmental, health and safety laws and regulations, ESSA could become subject to fines or penalties or incur costs that could have a material adverse effect on the success of ESSA’s business.
- ESSA is and there is a risk that ESSA may continue to be a “passive foreign investment company” which would likely result in materially adverse U.S. federal income tax consequences for U.S. investors.
- It may be difficult for United States investors to effect services of process or enforcement of actions against the Company or certain of its directors and officers under U.S. federal securities laws.
- Risks Relating to ESSA’s Common Shares
- The market price and trading volume of ESSA’s Common Shares may be volatile, which could result in rapid and substantial losses for its shareholders or securities litigation.
- The Company has never declared dividends and may not do so in the future.
- The Company may experience future sales or issue additional securities.
- An active trading market for the Common Shares may not be sustained.
- Widespread health concerns, pandemics or epidemics, and other outbreaks of illness may negatively affect the Company’s ability to maintain operations and execute its business plan.
- If ESSA is unable to implement and maintain effective internal control over financial reporting in the future, ESSA may not be able to report financial results accurately or prevent fraud. In that case, investors may lose confidence in the accuracy and completeness of ESSA’s financial reports and the market price of ESSA’s Common Shares may be negatively affected.
- Provisions in ESSA's corporate charter documents and Canadian law could make an acquisition of the Company, which may be beneficial to ESSA's shareholders, more difficult and may prevent attempts by the shareholders to replace or remove ESSA's current management and/or limit the market price of the Common Shares.
- If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about ESSA’s business, its stock price and trading volume could decline.
Management Discussion
- There was no revenue in any of the periods ended as reported. The Company incurred a comprehensive loss of $22,167,573 for the nine months ended June 30, 2024 compared to a comprehensive loss of $21,087,993 for the nine months ended June 30, 2023. Variations in ESSA’s expenses and net loss for the periods resulted primarily from the following factors:
- The overall research and development expense for the nine months ended June 30, 2024 was $17,018,874 compared to $16,096,299 for the nine months ended June 30, 2023. R&D expense in the nine month periods ended June 30, 2024 and 2023 reflects the ongoing clinical trial of masofaniten (EPI-7386) which commenced in July 2020.
- Clinical costs of $6,891,138 (2023 - $4,230,255) were generated in relation to expenditures associated with the Company’s clinical research organizations conducting the clinical trials of masofaniten (EPI-7386). Expenditures in the nine months ended June 30, 2024 have increased over the prior period as the clinical sites and participants have expanded in the combination studies. Associated variable costs for the resulting data have increased concurrently.