SMTI Sanara MedTech Dashboard

Risks

• Risks Related to How We Operate Our Business
• The COVID-19 pandemic in the United States has and may continue to negatively impact our business, financial condition and results of operations.
• We have had a history of losses, which may continue as we expand our selling efforts.
• Our revenue growth for a particular period is difficult to predict, and a shortfall in forecast revenues may harm our operating results.
• Our current comprehensive wound and skin care strategy involves growth through acquisitions and investments, which requires us to incur substantial costs and potential liabilities for which we may never realize the anticipated benefits.
• If we cannot meet our future capital requirements, our business will suffer.
• Failure to retain and recruit key personnel would harm our ability to meet key objectives.
• We operate in highly competitive markets and face competition from large, well-established medical device manufacturers and telehealth providers as well as new market entrants, and if we are unable to compete within our markets or our products and services do not gain market acceptance, our operating results and financial condition could suffer.
• Security breaches and other disruptions could compromise our information and expose us to liability, which would cause our business and reputation to suffer.
• If we fail to maintain an effective system of internal controls over financial reporting, we may not be able to accurately report our financial results or prevent fraud and our business may be harmed and our stock price may be adversely impacted.
• The Loan Agreement governing our revolving line of credit includes restrictive terms, and our failure to comply with any of these terms could result in a default, which would have an adverse effect on our business and prospects.
• Risks Related to Our Products
• We rely on our research and development partners to design, manufacture and supply the products we have licensed for marketing. If one of our partners fails to perform adequately or fulfill our needs, we may be required to incur significant costs. We may also face significant delays in our product introductions and commercialization.
• Our future success will largely depend on our ability to maintain and further grow clinical acceptance and adoption of our products, and we may be unable to adequately educate healthcare practitioners on the use and benefits of our products.
• Competitors could invent products superior to ours and cause our products and technologies to become obsolete.
• Disruption of, or changes in, our distribution model or customer base could harm our sales and margins.
• If we are unable to manage product inventory in an effective and efficient manner, our profitability could be impaired.
• Failure of any third-party assessments to demonstrate desired outcomes in proposed endpoints may result in adverse regulatory actions, reduce physician usage or adoption of our products, or reduce the price, coverage and/or reimbursement for our products, which could have a negative impact on our business performance.
• We may have exposure to product liability claims.
• Interruptions in the supply of our products or inventory loss may adversely affect our business, results of operations and financial condition.
• Increased prices for, or unavailability of, raw materials used in our products could adversely affect our business, results of operations and financial condition.
• Risks Related to Our Planned Expansion into Wound and Skin Care Virtual Consult and Other Services
• Our planned expansion into wound and skin care virtual consult and other services could have a material adverse effect on our business, financial condition or results of operations.
• Our planned expansion into wound and skin care virtual consult and other services will require entrance into several markets in which we have little or no experience, which may not be successful and could be costly.
• Our planned expansion into the telehealth business is dependent on our relationships with affiliated professional entities to provide physician services, and our business would be adversely affected if those relationships were disrupted.
• Recent and frequent state legislative and regulatory changes specific to telemedicine may present us with additional requirements and state compliance costs, with potential operational impacts in certain jurisdictions.
• Risks Related to Intellectual Property
• If we are unable to adequately protect our intellectual property rights, we may not be able to compete effectively.
• CellerateRX Surgical is not currently protected by any pending patent application nor any unexpired patent. Accordingly, CellerateRX Surgical may be subject to competition from the sale of substantially equivalent products that could adversely affect our business and operations.
• We are heavily dependent on technologies and products we have licensed from third parties, and we may need to license technologies and products in the future, and if we fail to obtain licenses we need, or fail to comply with our payment obligations in the agreements under which we in-license intellectual property and other rights from third parties, we could lose our ability to develop and commercialize our products.
• We may be found to infringe on intellectual property rights of others.
• Risks Related to Regulations
• Our business is affected by numerous regulations relating to the labeling, marketing and sale of our products.
• If we fail to obtain or experience significant delays in obtaining regulatory clearances or approvals to market future medical device products, we will be unable to commercialize these products until such clearance or approval is obtained.
• Changes to the FDA clearance and approval processes or ongoing regulatory requirements could make it more difficult for us to obtain FDA clearance or approval of new products or comply with ongoing requirements.
• Modifications to our current products may require new marketing clearances or approvals or require us to cease marketing or recall the modified products until such clearances or approvals are obtained.
• Failure to obtain or maintain adequate reimbursement or insurance coverage for drugs, if any, could limit our ability to market those drugs and decrease our ability to generate revenue. Changes in reimbursement policies and regulations by governmental or other third-party payors may have an adverse impact on the use of our products.
• We rely on our research and development partners to comply with applicable laws and regulations relating to product classification and FDA marketing authorization.
• We and our employees and contractors are subject, directly or indirectly, to federal, state and foreign healthcare fraud and abuse laws, including false claims laws. If we are unable to comply, or have not fully complied, with such laws, we could face substantial penalties.
• Our research and development partners’ use and disclosure of personally identifiable information, including health information, is subject to federal and state privacy and security regulations, and our failure to comply with those regulations or to adequately secure the information we hold could result in significant liability or reputational harm and, in turn, a material adverse effect on our client base, business, financial condition and results of operations.
• Government regulation of healthcare creates risks and challenges with respect to our compliance efforts and our business strategies.
• If we fail to comply with extensive healthcare laws and government regulations, we could suffer penalties or be required to make significant changes to our operations.
• Our officers, employees, independent contractors, principal investigators, consultants, and commercial partners may engage in misconduct or activities that are improper under other laws and regulations, which would create liability for us.
• We could be adversely affected if healthcare reform measures substantially change the market for medical care or healthcare coverage in the United States.
• Defects, failures or quality issues associated with our products could lead to product recalls or safety alerts, adverse regulatory actions, litigation and negative publicity that could materially adversely affect our reputation, business, results of operations and financial condition.
• Risks Related to Ownership of Our Common Stock
• The issuance of shares upon the exercise of derivative securities may cause immediate and substantial dilution to our existing shareholders.
• It is possible that we will require additional capital to meet our financial obligations and support business growth.
• The trading price of the shares of our common stock is highly volatile, and purchasers of our common stock could incur substantial losses.
• Our common stock does not have a vigorous trading market, and you may not be able to sell your securities at or near ask prices, or at all.
• The potential sale of large amounts of common stock may have a negative effect upon the market value of our shares.
• We have not paid, and we are unlikely to pay, cash dividends on our securities in the near future. Because we have no current plans to pay cash dividends on our common stock for the foreseeable future, you may not receive any return on investment unless you sell your common stock for a price greater than that which you paid for it.
• A few of our existing shareholders own a large percentage of our voting stock and have control over matters requiring shareholder approval and may delay or prevent a change in control or otherwise lead to actual or potential conflicts of interest.
• Our Certificate of Formation includes provisions limiting the personal liability of our directors for breaches of fiduciary duties under Texas law.
• Texas law and our Certificate of Formation and bylaws contain anti-takeover provisions that could delay or discourage takeover attempts that shareholders may consider favorable.
• Our failure to meet the continued listing requirements of The Nasdaq Capital Market could result in a delisting of our common stock.