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What changed in Beyond Air, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Beyond Air, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+238 added−228 removedSource: 10-K (2025-06-20) vs 10-K (2024-06-24)

Top changes in Beyond Air, Inc.'s 2025 10-K

238 paragraphs added · 228 removed · 167 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

57 edited+21 added−24 removed294 unchanged
Biggest changeBeyond Air has formed a wholly owned subsidiary called NeuroNOS which is responsible for pre-clinical and clinical development. 6 Our approved product and active pipeline of product candidates is shown in the tables below: (a) All dates are calendar year, and based on projections and appropriate financing, anticipated first launch on a global basis pending appropriate regulatory approvals Our programs represent large market opportunities: All figures are Company estimates for peak year sales: Global sales potential includes U.S. sales potential. 7 LungFit ® PH is the first FDA-approved system using our patented plasma pulse technology to generate on-demand NO from ambient air and, regardless of dose or flow, deliver it to a ventilator circuit.
Biggest changeBeyond Air has 88.2% ownership in NeuroNOS. 6 Our approved product and active pipeline of product candidates is shown in the tables below: 7 LungFit ® PH is the first FDA-approved system using our patented plasma pulse technology to generate on-demand NO from ambient air and, regardless of dose or flow, deliver it to a ventilator circuit.
Patients were also trained to use LungFit ® GO and subsequently discharged to complete the remaining portion of the two-week treatment period at their home at the highest tolerated NO concentration. For the second treatment phase, a 10-week maintenance phase, the administration was twice daily.
Patients were also trained to use LungFit ® GO and subsequently discharged to complete the remaining portion of the two-week treatment period at their home at the highest tolerated NO concentration. For the second treatment phase, a 10-week maintenance phase, the administration was twice daily.
These include: ● establishment registration and device listing with the FDA; ● QSR requirements, which require manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process; ● labeling regulations and FDA prohibitions against the promotion of investigational products, or the promotion of off-label (as defined below) uses of cleared or approved products; ● requirements related to promotional activities; ● clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared devices, or approval of certain modifications to PMA-approved devices; ● medical device reporting regulations which require that a manufacturer report to the FDA if a device it markets may have caused or contributed to death or serious injury, or has malfunctioned and the device or a similar device that it markets would be likely to cause or contribute to a death or serious injury, if the malfunction were to recur. ● correction, removal and recall reporting regulations, which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FFDCA that may present a risk to health; ● the FDA’s recall authority, whereby the agency can order device manufacturers to recall from the market a product that is in violation of governing laws and regulations; and ● post-market surveillance activities and regulations, which apply when deemed by the FDA to be necessary to protect the public health or to provide additional safety and effectiveness data for the device.
These include: ● establishment registration and device listing with the FDA; ● QSR requirements, which require manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process; ● labelling regulations and FDA prohibitions against the promotion of investigational products, or the promotion of off-label (as defined below) uses of cleared or approved products; ● requirements related to promotional activities; ● clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared devices, or approval of certain modifications to PMA-approved devices; ● medical device reporting regulations which require that a manufacturer report to the FDA if a device it markets may have caused or contributed to death or serious injury, or has malfunctioned and the device or a similar device that it markets would be likely to cause or contribute to a death or serious injury, if the malfunction were to recur. ● correction, removal and recall reporting regulations, which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FFDCA that may present a risk to health; ● the FDA’s recall authority, whereby the agency can order device manufacturers to recall from the market a product that is in violation of governing laws and regulations; and ● post-market surveillance activities and regulations, which apply when deemed by the FDA to be necessary to protect the public health or to provide additional safety and effectiveness data for the device.
Other post-market requirements in the same vein as those described above for medical devices and drugs will also apply, depending on the application type and center overseeing regulation of the combination product, including: ● Other record-keeping requirements; ● Post-market adverse event and Medical Device Reporting requirements; ● Labeling regulations and FDA prohibitions against the promotion of products for uncleared, unapproved or off-label uses; ● Advertising and promotion requirements; ● Restrictions on sale, distribution or use of the product; ● Requirements for recalls being conducted and recall reporting; ● An order of repair, replacement or refund; ● Product tracking requirements; and ● Post-market surveillance or clinical trials. 25 Coverage and Reimbursement.
Other post-market requirements in the same vein as those described above for medical devices and drugs will also apply, depending on the application type and center overseeing regulation of the combination product, including: ● Other record-keeping requirements; ● Post-market adverse event and Medical Device Reporting requirements; ● Labelling regulations and FDA prohibitions against the promotion of products for uncleared, unapproved or off-label uses; ● Advertising and promotion requirements; ● Restrictions on sale, distribution or use of the product; ● Requirements for recalls being conducted and recall reporting; ● An order of repair, replacement or refund; ● Product tracking requirements; and ● Post-market surveillance or clinical trials. 25 Coverage and Reimbursement.
For example, LungFit ® PH does not require the use of a high-pressure cylinder, does not require cumbersome purging procedures and places less burden on hospital staff in carrying out safety procedures.
For example, LungFit ® PH does not require the use of a high-pressure cylinder, does not require cumbersome purging procedures and places less burden on hospital staff in carrying out logistics and safety procedures.
The LungFit ® platform is not utilized for the solid tumor indication due to the need for ultra-high concentrations of gaseous nitric oxide (“UNO”). A proprietary delivery system has been developed that is designed to safely deliver UNO in excess of 10,000 ppm directly to a solid tumor. This program has advanced to phase 1 clinical trials.
The LungFit ® platform is not utilized for the solid tumor indication due to the need for ultra-high concentrations of gaseous nitric oxide (“UNO”). A proprietary delivery system has been developed that is designed to safely deliver UNO in excess of 10,000 ppm directly to a solid tumor. This program is currently in phase 1 clinical trials.
ITEM 1. BUSINESS Business Overview We are a commercial-stage medical device and biopharmaceutical company developing a platform of nitric oxide (“NO”) generators and delivery systems (the “LungFit ® platform”) capable of generating NO from ambient air. Our first device, LungFit ® PH received premarket approval (“PMA”) from the FDA in June 2022.
ITEM 1. BUSINESS Business Overview We are a commercial-stage medical device and biopharmaceutical company developing a platform of nitric oxide (“NO”) generators and delivery systems (the “LungFit ® platform”) capable of generating NO from ambient air. The Company’s first device, LungFit ® PH received premarket approval (“PMA”) from the FDA in June 2022.
Our LungFit ® system has been manufactured at commercial scale with a contract manufacturer. 13 When programmed for lung infections, the LungFit ® , is designed to specifically deliver a NO dosage of 150 ppm and higher. We believe that the LungFit ® has a number of advantages over other NO formulation delivery systems.
Our LungFit ® system has been manufactured at commercial scale with a contract manufacturer. 13 When programmed for lung infections, the LungFit ® , is designed to specifically deliver NO at concentrations of 150 ppm and higher. We believe that the LungFit ® has a number of advantages over other NO formulation delivery systems.
LungFit ® can deliver NO either continuously or for a fixed amount of time at various flow rates and has the ability to either titrate dose on demand or maintain a constant dose. In July 2022, we commenced marketing LungFit ® PH in the United States for PPHN as a medical device.
LungFit ® can deliver NO either continuously or for a fixed amount of time at various flow rates and has the ability to either titrate dose on demand or maintain a constant dose. In September 2022, we commenced marketing LungFit ® PH in the United States for PPHN as a medical device.
These milestone payments are almost entirely sales-related and are capped at a total of $87 million across three separate and distinct indications that fall under the agreement with the majority of them, approximately $83 million, being sales-related based on cumulative sales milestones for each of the three products.
These milestone payments are almost entirely sales-related and are capped at a total of $87 million across three separate and distinct indications that fall under the agreement with the majority of them, approximately $83 million, being sales-related based on cumulative sales milestones for each of the three products. Patent Applications .
As partial consideration for the License, we issued to NitricGen warrants to purchase 100,000 shares of our common stock at an exercise price of $6.90 per share. To date, $1.5 million has been paid for milestones that were earned.
As partial consideration for the License, we issued to NitricGen warrants to purchase 100,000 shares of our common stock at an exercise price of $6.90 per share. To date, $1.7 million has been paid for milestones that were earned.
We market directly to our customers through our field sales team. A separate team of clinical specialists provides the training necessary to use the devices. Invoicing and cash collection are managed from our Garden City, New York headquarters.
We market directly to our customers through our field sales team. A separate team of clinical specialists provides the training necessary to use the devices. Invoicing and cash collection are managed by our Garden City, New York headquarters.
With Beyond Air’s focus on NO and its effect on the human condition, there are two additional programs that do not utilize our LungFit ® system. Through our majority-owned affiliate Beyond Cancer, Ltd. (“Beyond Cancer”), NO is used to target solid tumors.
With Beyond Air’s focus on NO and its effect on the human condition, there are two additional programs that do not utilize our LungFit ® system. Through our majority-owned affiliate Beyond Cancer Bermuda Limited (“Beyond Cancer”), NO is used to target solid tumors.
On December 18, 2019, we terminated the Circassia Agreement. Circassia contended that the termination was wrongful. On May 25, 2021, we and Circassia entered a settlement agreement (the “Settlement Agreement”) resolving all claims by and between both parties and mutually terminating the agreement with Circassia.
On December 18, 2019, we terminated the Circassia Agreement. Circassia contended that the termination was wrongful. On May 25, 2021, the Company and Circassia entered into a settlement agreement (the “Settlement Agreement”) resolving all claims by and between both parties and mutually terminating the Circassia Agreement.
Similarly, there are currently no FDA approved therapies utilizing nNOS inhibitors specifically for the treatment of ASD. 19 Manufacturing and Distribution We have contracted with third-party contract manufacturers, Spartronics LLC (“Spartronics”), and Medisize Ireland Limited (“Medisize”) who have completed a substantial portion of the commercial manufacturing process for our LungFit ® PH system.
Similarly, as it relates to NeuroNos, there are currently no FDA approved therapies utilizing nNOS inhibitors specifically for the treatment of ASD. 19 Manufacturing and Distribution We have contracted with third-party contract manufacturers, Spartronics LLC (“Spartronics”), and Medisize Ireland Limited (“Medisize”) who have completed a substantial portion of the commercial manufacturing process for our LungFit ® PH system.
We have entered into an agreement with Yissum Research Development Company of the Hebrew University of Jerusalem, LTD. to acquire the commercial rights for neuronal nitric oxide synthase (nNOS) inhibitors being developed for the treatment of autism spectrum disorder (“ASD”) and other neurological conditions.
NeuroNos has entered into an agreement with Yissum Research Development Company of the Hebrew University of Jerusalem, LTD. to acquire the commercial rights for neuronal nitric oxide synthase (nNOS) inhibitors being developed for the treatment of autism spectrum disorder (“ASD”) and other neurological conditions.
The information in or accessible through the SEC and our website are not incorporated into, and are not considered part of, this filing. Further, our references to the URLs for these websites are intended to be inactive textual references only. Human Capital As of March 31, 2024, we had 107 employees globally, all of whom were full time employees.
The information in or accessible through the SEC and our website is not incorporated into, and is not considered part of, this filing. Further, our references to the URLs for these websites are intended to be inactive textual references only. Human Capital As of March 31, 2025, we had 61 employees globally, all of whom were full-time employees.
Under the terms of the agreement, Beyond Air will make payments to the University over the two-year period from the date of the agreement for preclinical work. Also, we will pay a low single-digit royalty on net sales and certain one-time payments based on clinical, regulatory and sales milestones.
Under the terms of the agreement, Beyond Air shall pay to the University compensation for pre-clinical work over the two-year period from the date of the agreement. Also, we will pay a low single-digit royalty on net sales and certain one-time payments based on clinical, regulatory and sales milestones.
In addition, we will be reliant on our partners for commercial manufacture of our systems for both clinical studies and commercial supply. In the year ended March 31, 2024, the Company purchased approximately 75% of our materials from Spartronics.
In addition, we will be reliant on our partners for commercial manufacture of our systems for both clinical studies and commercial supply. In the year ended March 31, 2025, the Company purchased approximately 87% of our materials from Spartronics.
The Company presented positive results at the 2022 CHEST annual meeting, held from October 16, 2022 through October 19, 2022, further supporting development of intermittent high dose NO for the treatment of NTM. The study demonstrated that high dose NO treatment was safe and well-tolerated in both the home and hospital settings.
The Company presented positive results at the 2022 CHEST annual meeting, further supporting development of intermittent high dose NO for the treatment of NTM. The study demonstrated that high dose NO treatment was safe and well-tolerated in both the home and hospital settings.
Additionally, long-term safety data for high concentration inhaled NO in bronchiolitis was presented at the Pediatric Academic Societies Meeting 2022 (PAS 22), which was held in Denver, Colorado from April 21, 2022 through April 25, 2022. A total of 101 infants from the three prior pilot studies for bronchiolitis (n=198) participated in the long-term follow-up clinical trial.
Additionally, long-term safety data for high concentration inhaled NO in bronchiolitis was presented at the Pediatric Academic Societies Meeting 2022 (PAS 22). A total of 101 infants from the three prior pilot studies for bronchiolitis (n=198) participated in the long-term follow-up clinical trial.
According to the most recent year-end report from Mallinckrodt Pharmaceuticals (“Mallinckrodt”), sales of NO were $298.2 million in 2023 (down from $339.7 million in 2022) for the United States, Canada, Japan, Mexico and Australia, with ~90% in the United States. Outside of the U.S. there are multiple market participants which translates to considerably lower sales than in the U.S.
According to the most recent year-end report from Mallinckrodt Pharmaceuticals (“Mallinckrodt”), sales of NO were $261.4 million in 2024 (down from $303.2 million in 2023) for the United States, Canada, Japan, Mexico and Australia, with ~90% in the United States. Outside of the U.S. there are multiple market participants which translates to considerably lower relative sales than in the U.S.
For example, as vasodilator of smooth muscles, NO enhances blood flow and circulation. In addition, NO is involved in regulation of wound healing and immune responses to infection. The pharmacology, toxicity and other data for NO in humans is generally well known, and its use has been approved by the FDA as a vasodilator.
In addition, NO is involved in regulation of wound healing and immune responses to infection. The pharmacology, toxicity and other data for NO in humans is generally well known, and its use has been approved by the FDA as a vasodilator.
We believe the U.S. sales potential of LungFit ® PH in PPHN to be approximately $350 million and worldwide sales potential to be approximately $700 million.
We believe the U.S. sales potential of LungFit ® PH to be approximately $350 million and worldwide sales potential to be approximately $700 million or greater.
Novan Inc. has recently received approval for a nitric oxide-based prescription treatment called berdazimer for molluscum, a contagious skin infection. SaNOtize has an NO nasal spray that has received approval in India, Israel and eight other countries for preventing COVID-19 after exposure.
In addition, other companies may be developing inhaled NO delivery systems at various concentrations. Novan Inc. has recently received approval for a nitric oxide-based prescription treatment called berdazimer for molluscum, a contagious skin infection. SaNOtize has an NO nasal spray that has received approval in India, Israel and eight other countries for preventing COVID-19 after exposure.
Beyond Cancer will benefit from Beyond Air’s NO expertise, IP portfolio, preclinical oncology team, and regulatory progress, and will pay Beyond Air a single-digit royalty on all future revenues. Beyond Cancer is being led by a seasoned leadership team with experience in emerging healthcare companies and clinical oncology. Selena Chaisson, MD, currently serves as Beyond Cancer’s Chief Executive Officer.
Beyond Cancer benefits from Beyond Air’s NO expertise, IP portfolio, preclinical oncology team, and regulatory progress, and will pay Beyond Air a single-digit royalty on all future revenues. Beyond Cancer is being led by a seasoned leadership team with experience in emerging healthcare companies and clinical oncology.
The Company also reported a case of relapsed/refractory Triple Negative Breast Cancer (TNBC) in which the subject showed no evidence of malignancy in a satellite lesion 21 days following UNO treatment and a corollary, rapid and durable clinical resolution of radiation-induced dermatitis.
The Company also reported a case of relapsed/refractory Triple Negative Breast Cancer (TNBC) in which the subject showed no evidence of malignancy in a satellite lesion 21 days following UNO treatment and a corollary, rapid and durable clinical resolution of radiation-induced dermatitis. A Phase 1b trial protocol was approved by the Israeli Ministry of Health (IMOH) in December 2024.
A PCT patent application is a filing under the Patent Cooperation Treaty to which the U.S. and a number of other countries are a party. It provides a unified procedure for filing a single patent application to protect inventions in those countries.
We have over 72 pending patent applications worldwide, including U.S., foreign and Patent Corporation Treaty (“PCT”) patent applications. A PCT patent application is a filing under the Patent Cooperation Treaty to which the U.S. and a number of other countries are a party. It provides a unified procedure for filing a single patent application to protect inventions in those countries.
We have released preclinical data at several medical/scientific conferences showing the promise of delivering NO directly to tumors at concentrations of 20,000 ppm – 200,000 ppm. Results showed that local tumor ablation with NO conveyed anti-tumor immunity to the host.
UNO has shown anticancer properties in preclinical trials by eliciting an immune response from the host. We have released preclinical data at several medical/scientific conferences showing the promise of delivering NO directly to tumors at concentrations of 20,000 ppm – 200,000 ppm. Results showed that local tumor ablation with NO conveyed anti-tumor immunity to the host.
Strategies Our objective is to build a leading medical device and biopharmaceutical company that develops and commercializes patented and proprietary products for the treatment of respiratory infections and diseases, with an initial focus on the treatment of PPHN, AVP, BRO, NTM and severe infections in COPD patients, among others.
As of March 31, 2025 the remaining future milestone payments totaled $0.3 million. 14 Strategies Our objective is to build a leading medical device and biopharmaceutical company that develops and commercializes patented and proprietary products for the treatment of respiratory infections and diseases, with an initial focus on the treatment of PPHN, NTM and severe infections in COPD patients, among others.
LungFit ® PRO for the treatment of viral lung infections in hospitalized patients Viral Community-Acquired Pneumonia (including COVID-19) Viral pneumonia in adults is most commonly caused by rhinovirus, respiratory syncytial virus (“RSV”) and influenza virus.
We anticipate significant contribution to revenues in fiscal 2026 and beyond from these and future partnerships. LungFit ® PRO for the treatment of viral lung infections in hospitalized patients Viral Community-Acquired Pneumonia (including COVID-19) Viral pneumonia in adults is most commonly caused by rhinovirus, respiratory syncytial virus (“RSV”) and influenza virus.
The pivotal clinical trial for bronchiolitis was originally set to be performed in the winter of 2020/21 but was delayed due to the pandemic. We have completed three successful pilot studies for bronchiolitis.
The pivotal clinical trial for bronchiolitis was originally set to be performed in the winter of 2020/21 but was delayed due to the COVID-19 pandemic. We have completed three successful pilot studies for bronchiolitis. A further analysis of the three previously reported pilot studies was presented at the ATS International Conference 2021.
A Phase 1b trial protocol has been submitted to the Israeli Ministry of Health (IMOH) and upon regulatory approval, this trial will enroll up to 20 subjects with prior exposure to anti-PD-1 antibody that have either progressed, not achieved a response, or have prolonged stable disease ( 12 weeks) on single agent anti-PD-1 without radiographic evidence of continued tumor reduction.
This trial will enroll up to 15 subjects with prior exposure to anti-PD-1 antibody that have either progressed, not achieved a response, or have prolonged stable disease (12 weeks) on single agent anti-PD-1 without radiographic evidence of continued tumor reduction. Subjects enrolled in the Phase 1b trial will be treated with the UNO + anti-PD-1 combination.
We initiated the first phase of our commercial launch in July 2022 (the limited launch phase to introduce Lungfit PH and Beyond Air to hospitals), and entered into phase 2 (target initial market share gains in certain geographies) with an expanded commercial presence during the spring of 2023 in the U.S. and will continue to work toward a potential launch in the EU and globally in 2024 and beyond.We anticipate entering the final phase of our launch process in calendar 2025 where we will equip our commercial organization to become the market leader in the U.S. in a few years.
We initiated the first phase of our commercial launch in July 2022 (the limited launch phase to introduce Lungfit ® PH and Beyond Air to hospitals), and entered into phase 2 (target initial market share gains in certain geographies) with an expanded commercial presence during the spring of 2023 in the U.S.
During the 10-week at-home treatment period of the clinical trial, a total of 2,492 inhalations were self-administered with overall high treatment compliance (>90%). There were no SAEs related to treatment discontinuations reported over the 12-week treatment or 12-week follow up periods. Key efficacy endpoints showed strong results with improvement seen in the majority of quality-of-life domains.
The clinical trial demonstrated that high dose NO treatment was well-tolerated in both the home and hospital settings. During the 10-week at-home treatment period of the clinical trial, a total of 2,492 inhalations were self-administered with overall high treatment compliance (>90%). There were no SAEs related to treatment discontinuations reported over the 12-week treatment or 12-week follow up periods.
Treatment was well tolerated with no evidence of any serious side effects. We observed significant improvement in sputum production (up to 5-10 times more sputum), and subjective improvement in the well-being of both patients.
Patients received intermittent 30-minute treatments of 160 ppm NO, with two different regimes including hospitalization (5 times a day) and ambulatory treatment (2-3 inhalations a day). Treatment was well tolerated with no evidence of any serious side effects. We observed significant improvement in sputum production (up to 5-10 times more sputum), and subjective improvement in the well-being of both patients.
Compliance with these requirements is a prerequisite to be able to affix the CE mark on products, without which they cannot be marketed or sold in the EEA.
In the EEA, medical devices must currently comply with the General Safety and Performance Requirements laid down in Annex I to the EU MDR. Compliance with these requirements is a prerequisite to be able to affix the CE mark on products, without which they cannot be marketed or sold in the EEA.
Also in 2022, on December 13, we announced the publication of preclinical data in the peer-reviewed journal Cancer Cell International (CCI), which showed that our proprietary tumor ablation technology utilizing UNO induced a potent innate and adaptive immune response that prevented metastases and resulted in a statistically significant survival benefit. 11 Calendar year 2023 began with the announcement of Beyond Cancer’s entry into a sponsored research agreement with Stanford School of Medicine and the appointment of Frederick M.
On December 13, 2022, we announced the publication of preclinical data in the peer-reviewed journal Cancer Cell International (CCI), which showed that our proprietary tumor ablation technology utilizing UNO induced a potent innate and adaptive immune response that prevented metastases and resulted in a statistically significant survival benefit. 11 In April 2023, Beyond Cancer presented additional preclinical data for UNO therapy in solid tumors during the AACR 2023 annual meeting.
The clinical trial evaluated safety, quality of life, physical function, and bacterial load among other parameters. At the American Thoracic Society International Conference 2022 (ATS 2022), which was held in San Francisco from May 13, 2022 through May 18, 2022, we presented positive interim data from the ongoing clinical trial.
The clinical trial evaluated safety, quality of life, physical function, and bacterial load among other parameters. At the American Thoracic Society International Conference 2022 (ATS 2022), we presented positive interim data from the ongoing clinical trial. At the time of data cutoff on April 4, 2022, a total of 15 patients were enrolled in the pilot clinical trial.
NO is naturally produced by the body’s immune system to provide a first line of defense against invading pathogens. It is a powerful molecule with a short half-life of a few seconds in the blood, enabling it to be cleared rapidly from the body. NO has been shown to play a critical role in the function of several body systems.
It is a powerful molecule with a short half-life of a few seconds in the blood, enabling it to be cleared rapidly from the body. NO has been shown to play a critical role in the function of several body systems. For example, as vasodilator of smooth muscles, NO enhances blood flow and circulation.
Patients with unstable oxygen saturation during hospitalization, 66.7% of the inhaled NO treatment group, reached stable saturation of ≥93% during hospital stay as compared to 26.7% in the SST group.
Patients with unstable oxygen saturation during hospitalization, 66.7% of the inhaled NO treatment group, reached stable saturation of ≥93% during hospital stay as compared to 26.7% in the SST group. Following completion of the clinical trial and the 180-day follow-up period, incremental data were provided in a poster presentation at IDWeek 2022.
Our program in COPD is in the preclinical stage and will move forward subject to obtaining additional financing. 10 Ultra-High Concentration NO (UNO) in solid tumors through majority-owned affiliate Beyond Cancer, Ltd. In the fourth calendar quarter of 2021, Beyond Cancer, our majority-owned affiliate, raised $30.0 million in a private placement of common shares.
We anticipate commencing a pivotal clinical trial, pending funding, in calendar year 2026 following discussions with the FDA. Our program in COPD is in the preclinical stage and will move forward subject to obtaining additional financing. 10 Ultra-High Concentration NO (UNO) in solid tumors through majority-owned affiliate Beyond Cancer.
After completion of the clinical trial, we presented positive results at the American College of Chest Physicians (“CHEST”) annual meeting, held from October 16, 2022 through October 19, 2022, further supporting development of intermittent high dose NO for the treatment of NTM. The clinical trial demonstrated that high dose NO treatment was well-tolerated in both the home and hospital settings.
Patients were followed up for 12 weeks after the 12-week treatment period was completed. After completion of the clinical trial, we presented positive results at the 2022 American College of Chest Physicians (“CHEST”) annual meeting, further supporting development of intermittent high dose NO for the treatment of NTM.
We submitted a PMA supplement to the FDA in November 2023 for the expansion of the label to include certain cardiac surgeries and we expect to receive CE mark under the Medical Device Regulation (“MDR”) in the EU during the second half of calendar 2024.
We submitted a PMA supplement to the FDA in November 2023 for the expansion of the label to include certain cardiac surgeries.
European Regulation of Medical Devices. In the European Economic Area (“EEA”), we expect our products to be regulated as a medical device product falling within the scope of EU MDR. In the EEA, medical devices must currently comply with the General Safety and Performance Requirements laid down in Annex I to the EU MDR.
At this time, we have no material costs associated with environmental laws. European Regulation of Medical Devices. In the European Economic Area (“EEA”), we expect our products to be regulated as a medical device product falling within the scope of EU MDR.
Respiratory function and physical function were maintained during treatment and follow-up. Trends in the reduction of microbial load were observed and one patient achieved culture conversion with three consecutive negative sputum samples. We anticipate commencing a pivotal clinical trial in calendar year 2026 following discussions with the FDA.
Key efficacy endpoints showed strong results with improvement seen in the majority of quality-of-life domains. Respiratory function and physical function were maintained during treatment and follow-up. Trends in the reduction of microbial load were observed and one patient achieved culture conversion with three consecutive negative sputum samples.
On June 25, 2019, our name was changed to Beyond Air, Inc. from AIT Therapeutics, Inc. We have the following wholly owned subsidiaries: - Beyond Air Ltd. (“BA Ltd.”), incorporated in Israel on May 1, 2011. - Advanced Inhalation Therapies (“AIT”), a wholly-owned subsidiary of BA Ltd., incorporated on August 29, 2014, in Delaware.
On June 25, 2019, our name was changed to Beyond Air, Inc. from AIT Therapeutics, Inc. We have the following wholly owned subsidiaries: - Beyond Air Ltd.
Bellerophon Therapeutics is developing an NO delivery system for patients with chronic pulmonary diseases such as COPD, PH-sarcoidosis, or fibrotic interstitial lung disease.
Bellerophon Therapeutics is developing an NO delivery system for patients with chronic pulmonary diseases such as COPD, PH-sarcoidosis, or fibrotic interstitial lung disease. VERO Biotech LLC received FDA approval for their delivery system GENOSYL DS for HRF associated with PPHN in 2019, and received FDA approval for a third generation of that delivery system in 2023.
AIT was dissolved on March 1, 2021. - Beyond Air Australia Pty Ltd., incorporated on December 17, 2019 in Australia. - Beyond Air Ireland Limited, incorporated on March 5, 2020 in Ireland. - Beyond Air Cyprus Limited, incorporated on October 13, 2021 in Cyprus. - Jodheary Holdco 18 Limited, incorporated on March 24, 2023 in Ireland.
(“BA Ltd.”), incorporated in Israel on May 1, 2011. - Beyond Air Australia Pty Ltd., incorporated on December 17, 2019 in Australia. - Beyond Air Ireland Limited, incorporated on March 5, 2020 in Ireland. We have 88.2% ownership in the following entity: - Jodheary Holdco 18 Limited, incorporated on March 24, 2023 in Ireland.
At the time of data cutoff on April 4, 2022, a total of 15 patients were enrolled in the pilot clinical trial. The mean age of patients was 62.1 years (range: 22 – 82 years) with the majority female (80%), a distribution consistent with real-world NTM disease.
The mean age of patients was 62.1 years (range: 22 – 82 years) with the majority female (80%), a distribution consistent with real-world NTM disease. All 15 patients were successfully titrated to 250 ppm NO in the hospital setting, and no patients required dose reductions during the subsequent at-home portion of the clinical trial.
In the U.S., the FDA regulates drug and medical device products under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”), and its implementing regulations. Our products have been designated as devices by the FDA and will be regulated by the Center for Devices and Radiological Health (“CDRH”).
Our products have been designated as devices by the FDA and will be regulated by the Center for Devices and Radiological Health (“CDRH”).
The data were published in the Pediatric Infectious Disease Journal in 2017. The NO treatment regime, as well as the device for this treatment, was supplied by BA Ltd., our wholly owned subsidiary. Patients received intermittent 30-minute treatments of 160 ppm NO, with two different regimes including hospitalization (5 times a day) and ambulatory treatment (2-3 inhalations a day).
The data were published in the Pediatric Infectious Disease Journal in 2017. The NO treatment regime, as well as the device for this treatment, was supplied by BA Ltd. (as defined below), our wholly owned subsidiary.
In April 2023, its name was changed to Beyond Air (NO) Limited. In March 2024, its name was changed to NeuroNOS Ltd. - NeuroNOS Ltd Israel, incorporated on March 12, 2024 We also have 80% ownership in the following entity: - Beyond Air Bermuda Limited, incorporated on August 13, 2021 in Bermuda.
In April 2023, its name was changed to Beyond Air (NO) Limited. In March 2024, its name was changed to NeuroNOS Ltd.
The second program, which does not utilize the LungFit ® platform, partially inhibits neuronal nitric oxide synthase (“nNOS”) in the brain to treat neurological conditions. The first target indication is autism spectrum disorder (“ASD”). ASD is a serious neurodevelopmental and behavioral disorder, and one of the most disabling conditions and chronic illnesses in children.
The second program which does not utilize the LungFit® platform partially inhibits neuronal nitric oxide synthase (nNOS) in the brain to treat neurological conditions. The first target indication is autism spectrum disorder (“ASD”). On June 15, 2023, the Company announced that it has entered into an agreement with Yissum Research Development Company of the Hebrew University of Jerusalem, LTD.
The investors purchased a 20% equity ownership in Beyond Cancer, while Beyond Air maintained 80% equity ownership.
In the fourth calendar quarter of 2021, Beyond Cancer, our majority-owned affiliate, raised $30.0 million in a private placement of common shares. The investors purchased a 20% equity ownership in Beyond Cancer, while Beyond Air maintained 80% equity ownership.
Work is currently being done by the University in a preclinical setting. We expect the program to progress into a phase 1 first-in-human clinical trial in calendar year 2025. Background and NO Mechanism of Action NO is recognized as a vital molecule involved in many physiological and pathological processes.
The funding is being used to accelerate ongoing preclinical work, including IND-enabling studies as well as for general corporate purposes. Work is currently being done by the University in a preclinical setting. We expect this program to progress from preclinical to a phase 1 first-in-human clinical trial by the end of 2026.
LungFit ® can be used to treat patients on ventilators that require NO, as well as patients with chronic or acute severe lung infections via delivery through a breathing mask or similar apparatus. Furthermore, we believe that there is a high unmet medical need for patients suffering from certain severe lung infections that the LungFit ® platform can potentially address.
Furthermore, we believe that there is a high unmet medical need for patients suffering from certain severe lung infections that the LungFit ® platform can potentially address. The Company’s other areas of focus with the LungFit ® platform beyond PPHN are nontuberculous mycobacteria (“NTM”) lung infection and those with various severe lung infections with underlying chronic obstructive pulmonary disease (“COPD”).
Removed
Our current areas of focus with LungFit ® are PPHN, viral community-acquired pneumonia (“VCAP”) including COVID-19, bronchiolitis (“BRO”), nontuberculous mycobacteria (“NTM”) lung infection and those with various severe lung infections with underlying chronic obstructive pulmonary disease (“COPD”).
Added
On November 26, 2024, the Company received European CE mark approval of the LungFit PH® system for the following: ● The treatment of infants > 34 weeks gestation with hypoxic respiratory failure associated with clinical or echocardiographic evidence of pulmonary hypertension, in order to improve oxygenation and to reduce the need for extracorporeal membrane oxygenation; and ● The treatment of peri- and post-operative pulmonary hypertension in adults and newborn infants, infants and toddlers, children and adolescents, ages 0-17 years in conjunction to heart surgery, in order to selectively decrease pulmonary arterial pressure and improve right ventricular function LungFit ® can be used to treat patients on ventilators that require NO, as well as patients with chronic or acute severe lung infections via delivery of NO at concentrations > 100 parts per million (ppm) through a breathing mask or similar apparatus.
Removed
ASD includes a wide range of developmental disorders that share a core of neurobehavioral deficits manifested by abnormalities in social interactions, deficits in communication, restricted interests, and repetitive behaviors. In 2023, the CDC reported that approximately 1 in 36 children in the U.S. is diagnosed with an ASD.
Added
(the “University”) to acquire the commercial rights for nNOS inhibitors being developed for the treatment of ASD and other neurological conditions. Currently, there are no FDA-approved therapies specifically for the treatment of ASD. Under the terms of the agreement, Beyond Air shall pay to the University compensation for pre-clinical work over the three-year period from the date of the agreement.
Removed
The cost of caring for Americans with autism had reached $268 billion in 2015 and would rise to $461 billion by 2025 in the absence of more-effective interventions and support across the life span. We expect this program to progress from preclinical to a phase 1 first-in-human clinical trial in 2025.
Added
Also, the Company will pay to the University a low single-digit royalty on net sales and certain one-time payments based on clinical, regulatory and sales milestones. The Company expects this program to progress from preclinical to a phase 1 first-in-human clinical trial by the end of 2026.
Removed
LungFit ® PH is the inaugural device from the LungFit ® platform of NO generators that use patented ionizer technology and is the first FDA-approved product for Beyond Air.
Added
On March 24, 2025, Beyond Air reorganized its neurology business into a new private company called NeuroNOS Limited (“NeuroNOS”). Beyond Air’s infrastructure, for example regulatory, quality, legal, etc, will continue to support the NeruoNOS team.
Removed
Following completion of the clinical trial and the 180-day follow-up period, incremental data were provided in a poster presentation at IDWeek 2022 held from October 19, 2022, through October 23, 2022 in Washington, D.C.
Added
On November 26, 2024, the company received European CE mark approval of the LungFit PH ® system for the following: ● The treatment of infants > 34 weeks gestation with hypoxic respiratory failure associated with clinical or echocardiographic evidence of pulmonary hypertension, in order to improve oxygenation and to reduce the need for extracorporeal membrane oxygenation; and ● The treatment of peri- and post-operative pulmonary hypertension in adults and newborn infants, infants and toddlers, children and adolescents, ages 0-17 years in conjunction to heart surgery, in order to selectively decrease pulmonary arterial pressure and improve right ventricular function LungFit ® PH is the inaugural device from the LungFit ® platform of NO generators that use patented ionizer technology and is the first FDA-approved and CE Marked product for Beyond Air.
Removed
A further analysis of the three previously reported pilot studies was presented at the ATS International Conference 2021, which was held virtually from May 14, 2021 through May 19, 2021.
Added
We recently entered the final phase of our launch process where we will equip our commercial organization to become the market leader in the U.S. in a few years.
Removed
All 15 patients were successfully titrated to 250 ppm NO in the hospital setting, and no patients required dose reductions during the subsequent at-home portion of the clinical trial. Patients were followed up for 12 weeks after the 12-week treatment period was completed.
Added
Since receiving CE Mark in late November, 2024, we have received regulatory approvals in Australia, New Zealand, Hong Kong and Thailand with our partner Getz Healthcare and are awaiting approvals in several other countries in South East Asia. Additionally, we have signed new distribution agreements covering France, Italy, Turkey, India, Saudi Arabia, and Morocco, among others.
Removed
Previously, Dr. Chaisson was the Director of Healthcare Investments at Bailard, where she spent 16 years focusing on highly specialized, emerging healthcare opportunities with more than one-third of her portfolio dedicated to investing in oncology companies. Prior to Bailard, Dr. Chaisson held senior executive roles at RCM Capital Management and Tiger Management.
Added
Both safety and efficacy will be evaluated. Completion of enrollment is anticipated by the end of calendar 2025.
Removed
RCM Capital Management was acquired by Dresdner Bank in 1996 and then subsequently acquired by Allianz Global Investors U.S. in 2001. Dr. Chaisson received a BS in microbiology in 1987 from Louisiana State University in Baton Rouge, LA, where she graduated summa cum laude. She earned her MBA and MD from Stanford University in 1992 and 1993, respectively.
Added
In the first calendar quarter of 2025, NeuroNos, our majority-owned affiliate, raised $2.0 million in a private placement of common shares. The investors purchased a 11.8% equity ownership in NeuroNos, while Beyond Air maintained 88.2% equity ownership. The private placement remains open to investment at this time.
Removed
The Beyond Cancer Board of Directors consists of six members: ● Steve Lisi, Chairman of the Board, and CEO and Chairman of the Board of Beyond Air ● Selena Chaisson, MD, Director, and Chief Executive Officer of Beyond Cancer ● Amir Avniel, Executive Director, and Chief Business Officer and Co-Founder of Beyond Air ● Robert Carey, Director, and Board Member of Beyond Air ● David Dvorak, Director ● Gregory Berk, MD, Director UNO has shown anticancer properties in preclinical trials by eliciting an immune response from the host.
Added
Background and NO Mechanism of Action NO is recognized as a vital molecule involved in many physiological and pathological processes. NO is naturally produced by the body’s immune system to provide a first line of defense against invading pathogens.
Removed
Dirbas, MD, Associate Professor of Surgery, Division of Surgical Oncology, Stanford School of Medicine, and Mark D. Pegram, MD, the Suzy Yuan-Huey Hung Endowed Professor of Medical Oncology at the Stanford School of Medicine, to the Beyond Cancer Scientific Advisory Board (“SAB”). In addition to the research agreement, Dr.
Added
NovLead Biotechnology (Nanjing, China) has a device that produces NO through a process of passing an electric current through an electrolyte solution and Shenzhen Respomed Medical Technology (Shenzhen, China) has developed a machine that uses an electric charge to generate nitric oxide. Neither of these devices have approval outside of China.
Removed
Dirbas was named as Chair of the SAB, which provides guidance for ongoing preclinical studies as well as ongoing and planned future clinical trials in the use of UNO to treat solid tumors.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

66 edited+26 added−18 removed520 unchanged
Biggest changeEvents of default include, among other things: ● our failure to pay any principal or interest under the Loan Agreement or any note in connection therewith; ● any representation or warranty made shall prove to have been false or misleading in any material respect; ● the occurrence of circumstances that could reasonably be expected to have a material adverse effect; ● our default in any obligation under any other agreement involving indebtedness exceeding $250,000 that (i) results in the acceleration of such indebtedness or (ii) enables the holder of such indebtedness to accelerate such indebtedness; ● judicial or administrative actions by governmental or regulatory authorities that could reasonably be expected to have a material adverse effect; ● our breach of the restrictive covenants, reporting obligations or other terms of the Loan Agreement; and ● certain specified insolvency and bankruptcy-related events. 33 Subject to any applicable cure period set forth in the Loan Agreement, all amounts outstanding with respect to the Loans (principal and accrued interest), as well as any applicable prepayment premiums, final payment fees and other obligations and amounts owing under the loan documents, would become due and payable at the option of the Agent at the direction of the Lenders.
Biggest changeEvents of default include, among other things: ● our failure to pay any principal or interest under the Loan Agreement or any note in connection therewith; ● any representation or warranty made shall prove to have been false or misleading in any material respect; and ● certain specified insolvency and bankruptcy-related events.
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 certification or regulatory approval of our product candidates.
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 certification or regulatory approval of our product candidates.
Even if we succeed in scaling the commercialization of our approved product and succeed in developing and commercializing our product candidates, we may never generate revenue to sustain profitability; ● we have only one FDA-approved product, and we expect that we will need to raise additional funding before we can expect to become profitable from sales of our products; ● we are heavily dependent upon the success of our approved product and product candidates (which are in various stages of clinical development), and we cannot provide any assurance that the FDA or comparable foreign regulatory authorities will allow us to conduct further clinical trials; ● we are in the process of further developing our proprietary NO delivery system, and unexpected delays will adversely impact the timing of our U.S.-based clinical trials and approvals; ● we might be unable to develop product candidates that will achieve commercial success in a timely and cost-effective manner, or ever; ● our competitors may develop or commercialize products faster or more successfully than us; ● because some of the target patient populations of our approved product or product candidates are small, we must be able to successfully identify patients and achieve a significant market share to maintain profitability and growth; ● we rely on third parties to help conduct our preclinical studies, clinical trials and commercial scale manufacturing; ● if we are unable to obtain and maintain effective intellectual property rights for our technologies, approved product or current or future product candidates, we may not be able to compete effectively in our markets; and ● our future success depends in part upon our ability to retain our executive and scientific teams, and to attract, retain and motivate other qualified personnel.
Even if we succeed in scaling the commercialization of our approved product and succeed in developing and commercializing our product candidates, we may never generate revenue to sustain profitability; ● we have only one FDA/CE-approved product, and we expect that we will need to raise additional funding before we can expect to become profitable from sales of our products; ● we are heavily dependent upon the success of our approved product and product candidates (which are in various stages of clinical development), and we cannot provide any assurance that the FDA or comparable foreign regulatory authorities will allow us to conduct further clinical trials; ● we are in the process of further developing our proprietary NO delivery system, and unexpected delays will adversely impact the timing of our U.S.-based clinical trials and approvals; ● we might be unable to develop product candidates that will achieve commercial success in a timely and cost-effective manner, or ever; ● our competitors may develop or commercialize products faster or more successfully than us; ● because some of the target patient populations of our approved product or product candidates are small, we must be able to successfully identify patients and achieve a significant market share to maintain profitability and growth; ● we rely on third parties to help conduct our preclinical studies, clinical trials and commercial scale manufacturing; ● if we are unable to obtain and maintain effective intellectual property rights for our technologies, approved product or current or future product candidates, we may not be able to compete effectively in our markets; and ● our future success depends in part upon our ability to retain our executive and scientific teams, and to attract, retain and motivate other qualified personnel.
We may experience delays in our ongoing clinical trials for a number of reasons, which could adversely affect the costs, timing or successful completion of our clinical trials, including related to the following: ● we may be required to submit an IDE application to the FDA, which must become effective prior to commencing certain human clinical trials of medical devices, and the FDA may reject our IDE application and notify us that we may not begin clinical trials; ● regulators and other comparable foreign regulatory authorities may disagree as to the design or implementation of our clinical trials; ● regulators and/or an IRB, or other reviewing bodies may not authorize us or our investigators to commence a clinical trial, or to conduct or continue a clinical trial at a prospective or specific trial site; ● we may not reach agreement on acceptable terms with prospective contract research organizations (“CROs”) and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; ● clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials or abandon product development programs; ● the number of subjects or patients required for clinical trials may be larger than we anticipate, enrollment in these clinical trials may be insufficient or slower than we anticipate, and the number of clinical trials being conducted at any given time may be high and result in fewer available patients for any given clinical trial, or patients may drop out of these clinical trials at a higher rate than we anticipate; ● our third-party contractors, including those manufacturing products or conducting clinical trials on our behalf, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; ● we might have to suspend or terminate clinical trials for various reasons, including a finding that the subjects are being exposed to unacceptable health risks; ● we may have to amend clinical trial protocols or conduct additional studies to reflect changes in regulatory requirements or guidance, which we may be required to submit to an IRB and/or regulatory authorities for re-examination; ● regulators, IRBs, or other parties may require or recommend that we or our investigators suspend or terminate clinical research for various reasons, including safety signals or noncompliance with regulatory requirements; ● the cost of clinical trials may be greater than we anticipate; ● clinical sites may not adhere to the clinical protocol or may drop out of a clinical trial; ● we may be unable to recruit a sufficient number of clinical trial sites; ● regulators, IRBs, or other reviewing bodies may fail to approve or subsequently find fault with our manufacturing processes or facilities of third-party manufacturers with which we enter into agreement for clinical and commercial supplies, the supply of devices or other materials necessary to conduct clinical trials may be insufficient, inadequate or not available at an acceptable cost, or we may experience interruptions in supply; ● approval policies or regulations of the FDA or comparable foreign regulatory authorities may change in a manner rendering our clinical data insufficient for certification or approval; ● our current or future products may have undesirable side effects or other unexpected characteristics; and ● impacts of regional or global public health crises, such as the COVID-19 pandemic, could adversely affect any clinical trials we are conducting or plan to conduct, including delays or difficulties in enrolling or onboarding patients, initiating clinical sites, or obtaining the requisite certification or regulatory approvals, interruption of key clinical trial activities, or supply chain disruptions that delay or make it more difficult or costly to obtain the supplies and materials we need for clinical trials. 53 Any of these occurrences may significantly harm our business, financial condition and prospects.
We may experience delays in our ongoing clinical trials for a number of reasons, which could adversely affect the costs, timing or successful completion of our clinical trials, including related to the following: ● we may be required to submit an IDE application to the FDA, which must become effective prior to commencing certain human clinical trials of medical devices, and the FDA may reject our IDE application and notify us that we may not begin clinical trials; ● regulators and other comparable foreign regulatory authorities may disagree as to the design or implementation of our clinical trials; ● regulators and/or an IRB, or other reviewing bodies may not authorize us or our investigators to commence a clinical trial, or to conduct or continue a clinical trial at a prospective or specific trial site; ● we may not reach agreement on acceptable terms with prospective contract research organizations (“CROs”) and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; ● clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials or abandon product development programs; ● the number of subjects or patients required for clinical trials may be larger than we anticipate, enrollment in these clinical trials may be insufficient or slower than we anticipate, and the number of clinical trials being conducted at any given time may be high and result in fewer available patients for any given clinical trial, or patients may drop out of these clinical trials at a higher rate than we anticipate; ● our third-party contractors, including those manufacturing products or conducting clinical trials on our behalf, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; ● we might have to suspend or terminate clinical trials for various reasons, including a finding that the subjects are being exposed to unacceptable health risks; ● we may have to amend clinical trial protocols or conduct additional studies to reflect changes in regulatory requirements or guidance, which we may be required to submit to an IRB and/or regulatory authorities for re-examination; ● regulators, IRBs, or other parties may require or recommend that we or our investigators suspend or terminate clinical research for various reasons, including safety signals or noncompliance with regulatory requirements; ● the cost of clinical trials may be greater than we anticipate; ● clinical sites may not adhere to the clinical protocol or may drop out of a clinical trial; ● we may be unable to recruit a sufficient number of clinical trial sites; ● regulators, IRBs, or other reviewing bodies may fail to approve or subsequently find fault with our manufacturing processes or facilities of third-party manufacturers with which we enter into agreement for clinical and commercial supplies, the supply of devices or other materials necessary to conduct clinical trials may be insufficient, inadequate or not available at an acceptable cost, or we may experience interruptions in supply; ● approval policies or regulations of the FDA or comparable foreign regulatory authorities may change in a manner rendering our clinical data insufficient for certification or approval; ● our current or future products may have undesirable side effects or other unexpected characteristics; and ● impacts of regional or global public health crises, such as the COVID-19 pandemic, could adversely affect any clinical trials we are conducting or plan to conduct, including delays or difficulties in enrolling or onboarding patients, initiating clinical sites, or obtaining the requisite certification or regulatory approvals, interruption of key clinical trial activities, or supply chain disruptions that delay or make it more difficult or costly to obtain the supplies and materials we need for clinical trials. 52 Any of these occurrences may significantly harm our business, financial condition and prospects.
The following factors, in addition to other risk factors described in this section, may have a significant impact on the market price of our common stock: ● announcements of technological innovations or new products by us or our competitors; ● announcement of FDA approval, disapproval or delay of approval of our product candidates or other product-related actions; ● developments involving our discovery efforts and clinical trials; ● developments or disputes concerning patents or proprietary rights, including announcements of infringement, interference or other litigation against us or our potential licensees; ● developments involving our efforts to commercialize our products, including developments impacting the timing of commercialization; ● announcements concerning our competitors, or the biotechnology, pharmaceutical or drug delivery industry in general; ● public concerns as to the safety or efficacy of our approved product or product candidates or our competitors’ products; ● changes in government regulation of the pharmaceutical or medical industry; ● changes in the reimbursement policies of third-party insurance companies or government agencies; ● actual or anticipated fluctuations in our operating results; ● changes in financial estimates or recommendations by securities analysts; ● developments involving corporate collaborators, if any; ● changes in accounting principles; and ● the loss of any of our key scientific or management personnel.
The following factors, in addition to other risk factors described in this section, may have a significant impact on the market price of our common stock: ● announcements of technological innovations or new products by us or our competitors; ● announcement of FDA/CE approval, disapproval or delay of approval of our product candidates or other product-related actions; ● developments involving our discovery efforts and clinical trials; ● developments or disputes concerning patents or proprietary rights, including announcements of infringement, interference or other litigation against us or our potential licensees; ● developments involving our efforts to commercialize our products, including developments impacting the timing of commercialization; ● announcements concerning our competitors, or the biotechnology, pharmaceutical or drug delivery industry in general; ● public concerns as to the safety or efficacy of our approved product or product candidates or our competitors’ products; ● changes in government regulation of the pharmaceutical or medical industry; ● changes in the reimbursement policies of third-party insurance companies or government agencies; ● actual or anticipated fluctuations in our operating results; ● changes in financial estimates or recommendations by securities analysts; ● developments involving corporate collaborators, if any; ● changes in accounting principles; and ● the loss of any of our key scientific or management personnel.
Doing business internationally involves a number of risks, including but not limited to: ● multiple, conflicting and changing laws and regulations such as privacy regulations, tax laws, export and import restrictions, employment laws, regulatory requirements and other governmental certification, approvals, permits and licenses; ● failure by us to obtain certification or regulatory approvals for the use of our products in various countries; ● additional potentially relevant third-party patent rights; ● complexities and difficulties in obtaining protection and enforcing our intellectual property; ● difficulties in staffing and managing foreign operations; ● complexities associated with managing multiple payor reimbursement regimes, government payors or patient self-pay systems; ● limits on our ability to penetrate international markets; 67 ● financial risks, such as longer payment cycles, difficulty collecting accounts receivable, the impact of local and regional financial crises on demand and payment for our products and exposure to foreign currency exchange rate fluctuations; ● natural disasters, political and economic instability, including wars, terrorism and political unrest, outbreak of disease, boycotts, curtailment of trade and other business restrictions; ● certain expenses including, among others, expenses for travel, translation and insurance; and ● regulatory and compliance risks that relate to maintaining accurate information and control over sales and activities that may fall within the purview of the FCPA, its books and records provisions or its anti-bribery provisions.
Doing business internationally involves a number of risks, including but not limited to: ● multiple, conflicting and changing laws and regulations such as privacy regulations, tax laws, export and import restrictions, employment laws, regulatory requirements and other governmental certification, approvals, permits and licenses; ● failure by us to obtain certification or regulatory approvals for the use of our products in various countries; ● additional potentially relevant third-party patent rights; ● complexities and difficulties in obtaining protection and enforcing our intellectual property; ● difficulties in staffing and managing foreign operations; ● complexities associated with managing multiple payor reimbursement regimes, government payors or patient self-pay systems; ● limits on our ability to penetrate international markets; 66 ● financial risks, such as longer payment cycles, difficulty collecting accounts receivable, the impact of local and regional financial crises on demand and payment for our products and exposure to foreign currency exchange rate fluctuations; ● natural disasters, political and economic instability, including wars, terrorism and political unrest, outbreak of disease, boycotts, curtailment of trade and other business restrictions; ● certain expenses including, among others, expenses for travel, translation and insurance; and ● regulatory and compliance risks that relate to maintaining accurate information and control over sales and activities that may fall within the purview of the FCPA, its books and records provisions or its anti-bribery provisions.
Applications for our product candidates could fail to receive regulatory approval for many reasons, including but not limited to the following: ● the FDA or comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials; ● we may be unable to demonstrate to the FDA or comparable foreign regulatory authorities that a product candidate’s risk-benefit ratio for its proposed indication is acceptable; ● the FDA may determine that the population studied in the clinical program was not sufficiently broad or representative to assure safety in the full population for which we seek approval; ● the FDA may disagree with our interpretation of data from preclinical studies or clinical trials; ● the data collected from clinical trials of our product candidates may not be sufficient to support the submission of a PMA in the U.S. or elsewhere; ● the FDA or comparable foreign regulatory authorities may fail to approve the manufacturing processes, test procedures and specifications or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; ● the approval policies or regulations of the FDA or comparable foreign regulatory authorities and notified bodies may significantly change in a manner rendering our clinical data insufficient for certification or approval; and This lengthy certification or regulatory approval process, as well as the unpredictability of the results of clinical trials, may result in our failing to obtain certification or regulatory approval to market any of our product candidates, which would significantly harm our business, results of operations and prospects. 48 Our business and sale of our approved product and product candidates are subject to extensive regulatory requirements, including compliance with labelling, manufacturing and reporting controls.
Applications for our product candidates could fail to receive regulatory approval for many reasons, including but not limited to the following: ● the FDA or comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials; ● we may be unable to demonstrate to the FDA or comparable foreign regulatory authorities that a product candidate’s risk-benefit ratio for its proposed indication is acceptable; ● the FDA may determine that the population studied in the clinical program was not sufficiently broad or representative to assure safety in the full population for which we seek approval; ● the FDA may disagree with our interpretation of data from preclinical studies or clinical trials; ● the data collected from clinical trials of our product candidates may not be sufficient to support the submission of a PMA in the U.S. or elsewhere; ● the FDA or comparable foreign regulatory authorities may fail to approve the manufacturing processes, test procedures and specifications or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; ● the approval policies or regulations of the FDA or comparable foreign regulatory authorities and notified bodies may significantly change in a manner rendering our clinical data insufficient for certification or approval; and This lengthy certification or regulatory approval process, as well as the unpredictability of the results of clinical trials, may result in our failing to obtain certification or regulatory approval to market any of our product candidates, which would significantly harm our business, results of operations and prospects. 47 Our business and sale of our approved product and product candidates are subject to extensive regulatory requirements, including compliance with labelling, manufacturing and reporting controls.
If we or our third-party collaborators fail to comply with applicable regulatory requirements, a regulatory authority may take any of the following actions: ● conduct an investigation into our practices and any alleged violation of law; ● issue warning letters or untitled letters asserting that we are in violation of the law; ● seek an injunction or impose civil or criminal penalties or monetary fines; ● suspend or withdraw certification or regulatory approval; ● require that we suspend or terminate any ongoing clinical trials; ● refuse to approve pending applications or supplements to applications filed by us; ● suspend or impose restrictions on operations, including costly new manufacturing requirements; ● seize or detain products, refuse to permit the import or export of products, or require us to initiate a product recall; or ● exclude us from providing our products to those participating in government health care programs, such as Medicare and Medicaid, and refuse to allow us to enter into supply contracts, including government contracts. 45 The occurrence of any of the foregoing events or penalties may force us to expend significant amounts of time and money and may significantly inhibit our ability to bring to market or continue to market our products and generate revenue.
If we or our third-party collaborators fail to comply with applicable regulatory requirements, a regulatory authority may take any of the following actions: ● conduct an investigation into our practices and any alleged violation of law; ● issue warning letters or untitled letters asserting that we are in violation of the law; ● seek an injunction or impose civil or criminal penalties or monetary fines; ● suspend or withdraw certification or regulatory approval; ● require that we suspend or terminate any ongoing clinical trials; ● refuse to approve pending applications or supplements to applications filed by us; ● suspend or impose restrictions on operations, including costly new manufacturing requirements; ● seize or detain products, refuse to permit the import or export of products, or require us to initiate a product recall; or ● exclude us from providing our products to those participating in government health care programs, such as Medicare and Medicaid, and refuse to allow us to enter into supply contracts, including government contracts. 44 The occurrence of any of the foregoing events or penalties may force us to expend significant amounts of time and money and may significantly inhibit our ability to bring to market or continue to market our products and generate revenue.
The degree of market acceptance of LungFit ® PH and any of our product candidates that become approved for commercial sale will depend, in part, on a number of factors, including: ● the safety and efficacy of the product(s) as demonstrated in clinical trials and potential advantages over competing treatments; ● the prevalence and severity of any side effects, including any limitations or warnings contained in a product’s approved labeling; ● the clinical indications for which certification or approval is granted; ● relative convenience and ease of administration; ● familiarity of group purchasing organizations with our products; ● the cost of treatment, particularly in relation to competing treatments; ● the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ● the strength of marketing and distribution support and timing of market introduction of competitive products; ● publicity concerning our products or competing products and treatments; and ● sufficient third-party insurance coverage and reimbursement. 37 Even if a potential product displays a favorable efficacy and safety profile in preclinical studies and clinical trials, market acceptance of the product will not be fully known until after it is launched.
The degree of market acceptance of LungFit ® PH and any of our product candidates that become approved for commercial sale will depend, in part, on a number of factors, including: ● the safety and efficacy of the product(s) as demonstrated in clinical trials and potential advantages over competing treatments; ● the prevalence and severity of any side effects, including any limitations or warnings contained in a product’s approved labeling; ● the clinical indications for which certification or approval is granted; ● relative convenience and ease of administration; ● familiarity of group purchasing organizations with our products; ● the cost of treatment, particularly in relation to competing treatments; ● the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ● the strength of marketing and distribution support and timing of market introduction of competitive products; ● publicity concerning our products or competing products and treatments; and ● sufficient third-party insurance coverage and reimbursement. 36 Even if a potential product displays a favorable efficacy and safety profile in preclinical studies and clinical trials, market acceptance of the product will not be fully known until after it is launched.
Any corrective action, whether voluntary or involuntary, as well as defending ourselves in a lawsuit, will require the dedication of our time and capital, will distract management from operating our business and may harm our reputation and financial results. 43 All manufacturers placing medical devices on the market in the EEA are legally bound to report to the relevant competent authorities (a) any serious incident involving devices made available on the EEA market, except expected side-effects which are clearly documented in the product information and quantified in the technical documentation and are subject to trend reporting, and (b) any field safety corrective action in respect of devices made available on the EEA market, including any field safety corrective action undertaken in a third country in relation to a device which is also legally made available on the EEA market, if the reason for the field safety corrective action is not limited to the device made available in the third country.
Any corrective action, whether voluntary or involuntary, as well as defending ourselves in a lawsuit, will require the dedication of our time and capital, will distract management from operating our business and may harm our reputation and financial results. 42 All manufacturers placing medical devices on the market in the EEA are legally bound to report to the relevant competent authorities (a) any serious incident involving devices made available on the EEA market, except expected side-effects which are clearly documented in the product information and quantified in the technical documentation and are subject to trend reporting, and (b) any field safety corrective action in respect of devices made available on the EEA market, including any field safety corrective action undertaken in a third country in relation to a device which is also legally made available on the EEA market, if the reason for the field safety corrective action is not limited to the device made available in the third country.
Later discovery of previously unknown problems with such products, including unanticipated adverse events or adverse events of unanticipated severity or frequency, manufacturing problems, or failure to comply with regulatory requirements such as QSR, may result in changes to labeling, restrictions on such products or manufacturing processes, withdrawal of the products from the market, voluntary or mandatory recalls, a requirement to repair, replace or refund the cost of any medical device we manufacture or distribute, fines, suspension of certification or regulatory approval, product seizures, injunctions or the imposition of civil or criminal penalties which would adversely affect our business, operating results and prospects. 42 Moreover, we may be required to conduct costly post-market testing and surveillance to monitor the safety or effectiveness of our products in the EEA.
Later discovery of previously unknown problems with such products, including unanticipated adverse events or adverse events of unanticipated severity or frequency, manufacturing problems, or failure to comply with regulatory requirements such as QSR, may result in changes to labeling, restrictions on such products or manufacturing processes, withdrawal of the products from the market, voluntary or mandatory recalls, a requirement to repair, replace or refund the cost of any medical device we manufacture or distribute, fines, suspension of certification or regulatory approval, product seizures, injunctions or the imposition of civil or criminal penalties which would adversely affect our business, operating results and prospects. 41 Moreover, we may be required to conduct costly post-market testing and surveillance to monitor the safety or effectiveness of our products in the EEA.
However, if the FDA determines that our educational and promotional activities or training constitutes promotion of an off-label use, it could request that we modify our training or promotional materials or subject us to regulatory or enforcement actions, including the issuance of warning letters, untitled letters, fines, penalties, injunctions, or seizures, any of which could have an adverse impact on our reputation and financial results. 44 It is also possible that other federal, state or comparable foreign regulatory authorities might take action if they consider our educational and promotional activities or training methods to constitute promotion of an off-label use, which could result in significant fines or penalties under other statutory authorities, such as laws prohibiting false claims for reimbursement.
However, if the FDA determines that our educational and promotional activities or training constitutes promotion of an off-label use, it could request that we modify our training or promotional materials or subject us to regulatory or enforcement actions, including the issuance of warning letters, untitled letters, fines, penalties, injunctions, or seizures, any of which could have an adverse impact on our reputation and financial results. 43 It is also possible that other federal, state or comparable foreign regulatory authorities might take action if they consider our educational and promotional activities or training methods to constitute promotion of an off-label use, which could result in significant fines or penalties under other statutory authorities, such as laws prohibiting false claims for reimbursement.
If our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from participation in government health care programs, such as Medicare and Medicaid, imprisonment and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations. 40 If we fail to comply with applicable privacy, data protection and data security laws and regulations, we could face substantial penalties, liability and adverse publicity and our business, operations and financial condition could be adversely affected.
If our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from participation in government health care programs, such as Medicare and Medicaid, imprisonment and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations. 39 If we fail to comply with applicable privacy, data protection and data security laws and regulations, we could face substantial penalties, liability and adverse publicity and our business, operations and financial condition could be adversely affected.
In addition, our trade secrets may otherwise become known or be independently discovered by competitors. 62 All of our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information or technology enter into confidentiality agreements and we expect they will assign all rights in their inventions to us pursuant to the terms of such agreements; however, we cannot provide any assurances that all such agreements have been duly executed or that our trade secrets and other confidential proprietary information will not be disclosed or that competitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques.
In addition, our trade secrets may otherwise become known or be independently discovered by competitors. 61 All of our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information or technology enter into confidentiality agreements and we expect they will assign all rights in their inventions to us pursuant to the terms of such agreements; however, we cannot provide any assurances that all such agreements have been duly executed or that our trade secrets and other confidential proprietary information will not be disclosed or that competitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques.
Any of these catastrophic events, whether in the United States, Europe or abroad, may have a strong negative impact on the global economy, our employees, facilities, partners, suppliers, distributors or customers, and could decrease demand for our products, create delays and inefficiencies in our supply chain and make it difficult or impossible for us to deliver products to our customers. 68 We are dependent on information technology and our systems and infrastructure face certain risks, including from cybersecurity breaches and data leakage.
Any of these catastrophic events, whether in the United States, Europe or abroad, may have a strong negative impact on the global economy, our employees, facilities, partners, suppliers, distributors or customers, and could decrease demand for our products, create delays and inefficiencies in our supply chain and make it difficult or impossible for us to deliver products to our customers. 67 We are dependent on information technology and our systems and infrastructure face certain risks, including from cybersecurity breaches and data leakage.
Given that our proprietary position is based, in part, on our know-how and trade secrets, a competitor’s discovery of our trade secrets or other unauthorized use or disclosure would impair our competitive position and may have a material adverse effect on our business. 60 Risks Related to Our Intellectual Property If we are unable to obtain and maintain effective patent rights for LungFit ® PH, our product candidates or any future product candidates, we may not be able to compete effectively in our markets.
Given that our proprietary position is based, in part, on our know-how and trade secrets, a competitor’s discovery of our trade secrets or other unauthorized use or disclosure would impair our competitive position and may have a material adverse effect on our business. 59 Risks Related to Our Intellectual Property If we are unable to obtain and maintain effective patent rights for LungFit ® PH, our product candidates or any future product candidates, we may not be able to compete effectively in our markets.
The realization of any of the above risks or any of a broad range of other risks, including those described in these “Risk Factors,” could have a dramatic and material adverse impact on the market price of our common stock. 70 Anti-takeover provisions in our amended and restated certificate of incorporation and our amended and restated bylaws, as well as provisions of Delaware law, might discourage, delay or prevent a change in control of the Company or changes in our Board of Directors or management and, therefore, depress the trading price of our common stock.
The realization of any of the above risks or any of a broad range of other risks, including those described in these “Risk Factors,” could have a dramatic and material adverse impact on the market price of our common stock. 69 Anti-takeover provisions in our amended and restated certificate of incorporation and our amended and restated bylaws, as well as provisions of Delaware law, might discourage, delay or prevent a change in control of the Company or changes in our Board of Directors or management and, therefore, depress the trading price of our common stock.
If disputes over intellectual property and other rights that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize the affected approved product or product candidates and this may affect our financial performance. 64 We may be involved in lawsuits or post-grant proceedings to protect or enforce our patents or the patents of our licensor, which could be expensive, time-consuming and unsuccessful.
If disputes over intellectual property and other rights that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize the affected approved product or product candidates and this may affect our financial performance. 63 We may be involved in lawsuits or post-grant proceedings to protect or enforce our patents or the patents of our licensor, which could be expensive, time-consuming and unsuccessful.
If our information technology systems are compromised, we could be subject to fines, damages, litigation and enforcement actions, incur financial losses, suffer reputational damage, and lose trade secrets or other confidential information, each of which could significantly harm our business. 38 Healthcare legislative or regulatory reform measures, including government restrictions on pricing and reimbursement, may have a negative impact on our business and results of operations.
If our information technology systems are compromised, we could be subject to fines, damages, litigation and enforcement actions, incur financial losses, suffer reputational damage, and lose trade secrets or other confidential information, each of which could significantly harm our business. 37 Healthcare legislative or regulatory reform measures, including government restrictions on pricing and reimbursement, may have a negative impact on our business and results of operations.
In the event of a successful claim of infringement against us, we may have to pay substantial damages, including treble damages and attorneys’ fees for willful infringement, pay royalties, redesign our “infringing” products or obtain one or more licenses from third parties, which may be impossible or require substantial time and monetary expenditure. 63 We may not be successful in obtaining or maintaining necessary rights to our approved product or product candidates through acquisitions and in-licenses.
In the event of a successful claim of infringement against us, we may have to pay substantial damages, including treble damages and attorneys’ fees for willful infringement, pay royalties, redesign our “infringing” products or obtain one or more licenses from third parties, which may be impossible or require substantial time and monetary expenditure. 62 We may not be successful in obtaining or maintaining necessary rights to our approved product or product candidates through acquisitions and in-licenses.
Accordingly, the certification or approval of our product and product candidates for insurance coverage and reimbursement by governmental and private payors may impact our ability to generate revenues. 35 We face intense competition and rapid technological change and the possibility that our competitors may discover, develop or commercialize therapies that are similar, more advanced or more effective than ours, which may adversely affect our financial condition and our ability to successfully commercialize LungFit ® PH and our product candidates.
Accordingly, the certification or approval of our product and product candidates for insurance coverage and reimbursement by governmental and private payors may impact our ability to generate revenues. 34 We face intense competition and rapid technological change and the possibility that our competitors may discover, develop or commercialize therapies that are similar, more advanced or more effective than ours, which may adversely affect our financial condition and our ability to successfully commercialize LungFit ® PH and our product candidates.
The new EU HTA regulation aims to harmonize the clinical benefit assessment of HTA across the EU and provides the basis for permanent and sustainable cooperation at the EU level for joint clinical assessments in these areas. 39 We are subject to additional federal and state laws and regulations relating to our business, and our failure to comply with those laws could have a material adverse effect on our results of operations and financial conditions.
The new EU HTA regulation aims to harmonize the clinical benefit assessment of HTA across the EU and provides the basis for permanent and sustainable cooperation at the EU level for joint clinical assessments in these areas. 38 We are subject to additional federal and state laws and regulations relating to our business, and our failure to comply with those laws could have a material adverse effect on our results of operations and financial conditions.
In such an event, our studies could be suspended or terminated, and the FDA or comparable foreign regulatory authorities or notified bodies could order us to cease further development of or deny certification or approval of our product candidates for any or all targeted indications. 56 NO-related side effects could affect patient recruitment, the ability of enrolled patients to complete the study or result in potential product liability claims.
In such an event, our studies could be suspended or terminated, and the FDA or comparable foreign regulatory authorities or notified bodies could order us to cease further development of or deny certification or approval of our product candidates for any or all targeted indications. 55 NO-related side effects could affect patient recruitment, the ability of enrolled patients to complete the study or result in potential product liability claims.
Alternatively, if a court were to find the choice of forum provision contained in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition. 69 T rading in our common stock has been volatile and may continue to be volatile in the future.
Alternatively, if a court were to find the choice of forum provision contained in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition. 68 T rading in our common stock has been volatile and may continue to be volatile in the future.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing clearance that we may have obtained and we may not achieve or sustain profitability. 50 In addition, on May 25, 2017, the new EU MDR entered into force for medical devices marketed in the EEA.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing clearance that we may have obtained and we may not achieve or sustain profitability. 49 In addition, on May 25, 2017, the new EU MDR entered into force for medical devices marketed in the EEA.
As a result, our business, financial condition and results of operations may be materially harmed. 58 Additionally, if supply from one approved manufacturer is interrupted, an alternative manufacturer would need to be qualified through a PMA Supplement or Marketing Authorization Application amendment, or equivalent foreign regulatory filing, which could result in further delays.
As a result, our business, financial condition and results of operations may be materially harmed. 57 Additionally, if supply from one approved manufacturer is interrupted, an alternative manufacturer would need to be qualified through a PMA Supplement or Marketing Authorization Application amendment, or equivalent foreign regulatory filing, which could result in further delays.
In addition, violations may also result in reputational harm, diminished profits and future earnings. 72 Employee litigation and unfavorable publicity could negatively affect our future business. Our employees may, from time to time, bring lawsuits against us regarding injury, creating a hostile work place, discrimination, wage and hour disputes, sexual harassment, or other employment issues.
In addition, violations may also result in reputational harm, diminished profits and future earnings. 71 Employee litigation and unfavorable publicity could negatively affect our future business. Our employees may, from time to time, bring lawsuits against us regarding injury, creating a hostile work place, discrimination, wage and hour disputes, sexual harassment, or other employment issues.
Moreover, achieving and sustaining compliance with applicable federal, state, and foreign privacy and data security laws and regulations may prove costly. 41 If we or our suppliers fail to comply with ongoing FDA or other foreign regulatory authority requirements, or if we experience unanticipated problems with our products, these products could be subject to restrictions or withdrawal from the market.
Moreover, achieving and sustaining compliance with applicable federal, state, and foreign privacy and data security laws and regulations may prove costly. 40 If we or our suppliers fail to comply with ongoing FDA or other foreign regulatory authority requirements, or if we experience unanticipated problems with our products, these products could be subject to restrictions or withdrawal from the market.
Research programs to identify new product candidates require substantial technical, financial and human resources. We may focus our efforts and resources on potential programs or product candidates that ultimately prove to be unsuccessful. 47 The certification or regulatory approval processes of the FDA and comparable foreign regulatory authorities and notified bodies are lengthy, time-consuming and inherently unpredictable.
Research programs to identify new product candidates require substantial technical, financial and human resources. We may focus our efforts and resources on potential programs or product candidates that ultimately prove to be unsuccessful. 46 The certification or regulatory approval processes of the FDA and comparable foreign regulatory authorities and notified bodies are lengthy, time-consuming and inherently unpredictable.
If we fail to adequately demonstrate this to the satisfaction of the relevant IRB, it will decline to approve the research, which could have significant adverse consequences for us. 55 A failure of one or more clinical trials can occur at any stage of testing, and our future clinical trials may not be successful.
If we fail to adequately demonstrate this to the satisfaction of the relevant IRB, it will decline to approve the research, which could have significant adverse consequences for us. 54 A failure of one or more clinical trials can occur at any stage of testing, and our future clinical trials may not be successful.
Though we carefully manage our relationships with our CROs, there can be no assurance that we will not encounter similar challenges or delays in the future or that these delays or challenges will not have a material adverse impact on our business, financial condition and prospects. 57 We rely on third parties to manufacture our NO generator and delivery system.
Though we carefully manage our relationships with our CROs, there can be no assurance that we will not encounter similar challenges or delays in the future or that these delays or challenges will not have a material adverse impact on our business, financial condition and prospects. 56 We rely on third parties to manufacture our NO generator and delivery system.
They could also deter potential acquirers of the Company, thereby reducing the likelihood that you could receive a premium for your common stock in an acquisition. 71 Risks Related to Employee Matters Our business could suffer if we lose the services of key members of our senior management, key advisors or personnel.
They could also deter potential acquirers of the Company, thereby reducing the likelihood that you could receive a premium for your common stock in an acquisition. 70 Risks Related to Employee Matters Our business could suffer if we lose the services of key members of our senior management, key advisors or personnel.
Such repayment could have a material adverse effect on our business, operating results and financial condition. 34 Risks Related to Commercialization of Our Approved Product or Product Candidates If the market opportunities for our approved product or product candidates are smaller than we believe they are, our revenue may be adversely affected, and our business may suffer.
Such repayment could have a material adverse effect on our business, operating results and financial condition. 33 Risks Related to Commercialization of Our Approved Product or Product Candidates If the market opportunities for our approved product or product candidates are smaller than we believe they are, our revenue may be adversely affected, and our business may suffer.
In these circumstances, we may be subject to significant enforcement actions. 49 For example, if a manufacturer determines that a modification to a PMA approved device could affect its safety or effectiveness or would constitute a major change in its intended use, then the manufacturer must file for a new a new PMA or approval of a PMA supplement.
In these circumstances, we may be subject to significant enforcement actions. 48 For example, if a manufacturer determines that a modification to a PMA approved device could affect its safety or effectiveness or would constitute a major change in its intended use, then the manufacturer must file for a new a new PMA or approval of a PMA supplement.
On July 1 , 2023, The UK Medical Device Regulations 2002 (SI 2002 No 618, as amended) (“UK MDR”) was amended to extend the acceptance of CE marked medical devices on the Great Britain market up to June 30, 2030. 51 We are working on NTM lung infection which is very rare.
On July 1, 2023, The UK Medical Device Regulations 2002 (SI 2002 No 618, as amended) (“UK MDR”) was amended to extend the acceptance of CE marked medical devices on the Great Britain market up to June 30, 2030. 50 We are working on NTM lung infection which is very rare.
As a result, we would need to pursue different regulatory pathways for placing our product on the EEA market which may lead to additional costs and time. 54 We may find it difficult to enroll patients in our clinical trials. Difficulty in enrolling patients could delay or prevent clinical trials of our product candidates.
As a result, we would need to pursue different regulatory pathways for placing our product on the EEA market which may lead to additional costs and time. 53 We may find it difficult to enroll patients in our clinical trials. Difficulty in enrolling patients could delay or prevent clinical trials of our product candidates.
Further, if we are unable to repay, refinance or restructure our obligations under the Loans, the Agent on behalf of the Lenders could proceed to protect and enforce their rights under the Agreement and the other loan documents by exercising such remedies (including foreclosure on the assets securing our obligations under the Agreement and the other loan documents) as are available to the Agent and the Lenders and in respect thereof under applicable law, either by suit in equity or by action at law, or both, whether for specific performance of any covenant or other agreement contained in the Agreement or the other loan documents or in aid of the exercise of any power granted in the Agreement or other loan documents.
Further, if we are unable to repay, refinance or restructure our obligations, the lenders could proceed to protect and enforce their rights under the Loan Agreement by exercising such remedies (including foreclosure on the assets securing our obligations under the Loan Agreement) as are available to the lenders and in respect thereof under applicable law, either by suit in equity or by action at law, or both, whether for specific performance of any covenant or other agreement contained in the Loan Agreement or the other loan documents or in aid of the exercise of any power granted in the Loan Agreement or other loan documents.
As a result, we may receive less revenue from future products if such claims are successful which in turn could impact our future profitability. 65 Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our products.
As a result, we may receive less revenue from future products if such claims are successful which in turn could impact our future profitability. 64 Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our products.
Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license. 66 Risks Related to Our Business Operations We manage our business through a small number of employees and key consultants.
Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license. 65 Risks Related to Our Business Operations We manage our business through a small number of employees and key consultants.
If we do not receive certification or regulatory approvals for our other product candidates, we may not be able to continue our operations. 46 We generally plan to seek certification or regulatory approval to commercialize our approved product and product candidates in the U.S., the EU and in additional foreign countries, as applicable.
If we do not receive certification or regulatory approvals for our other product candidates, we may not be able to continue our operations. 45 We generally plan to seek certification or regulatory approval to commercialize our approved product and product candidates in the U.S., the EU and in additional foreign countries, as applicable.
Our clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical and non-clinical testing in addition to those we have planned. 52 The initiation and completion of our clinical trials may be prevented, delayed, or halted for numerous reasons.
Our clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical and non-clinical testing in addition to those we have planned. 51 The initiation and completion of our clinical trials may be prevented, delayed, or halted for numerous reasons.
No assurances can be given that a license will be available on commercially reasonable terms, if at all. 61 It is also possible that we have failed to identify relevant third-party patents or applications.
No assurances can be given that a license will be available on commercially reasonable terms, if at all. 60 It is also possible that we have failed to identify relevant third-party patents or applications.
Additionally, technologies developed by our competitors may render LungFit ® PH or our potential product candidates uneconomical or obsolete, and we may not be successful in marketing LungFit ® PH or our product candidates against competitors. 36 We currently have a limited marketing and sales organization.
Additionally, technologies developed by our competitors may render LungFit ® PH or our potential product candidates uneconomical or obsolete, and we may not be successful in marketing LungFit ® PH or our product candidates against competitors. 35 We currently have a limited marketing and sales organization.
Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate and financial market conditions could adversely impact our business. 73 ITEM 1B. UNRESOLVED STAFF COMMENTS None.
Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate and financial market conditions could adversely impact our business. 72 ITEM 1B. UNRESOLVED STAFF COMMENTS None.
This would increase our reliance on that manufacturer or require us to obtain a license from that manufacturer in order to have LungFit ® PH or our product candidates manufactured by other suppliers utilizing the same process. In the year ended March 31, 2024, the Company purchased approximately 75% of its materials from a third-party vendor.
This would increase our reliance on that manufacturer or require us to obtain a license from that manufacturer in order to have LungFit ® PH or our product candidates manufactured by other suppliers utilizing the same process. In the year ended March 31, 2025, the Company purchased approximately 87% of its materials from a third-party vendor.
As of March 31, 2024, we had a total of 107 full-time employees between us and our subsidiaries and a number of dedicated consultants, all of whom work for us on a part-time basis. In addition, any of our employees and consultants may leave the Company at any time, subject to certain notice periods.
As of March 31, 2025, we had a total of 61 full-time employees between us and our subsidiaries and a number of dedicated consultants, all of whom work for us on a part-time basis. In addition, any of our employees and consultants may leave the Company at any time, subject to certain notice periods.
The Loan Agreement also includes events of default customary for financings of this type, in certain cases subject to customary periods to cure, following which the Agent may accelerate all amounts outstanding under the Loans.
The Loan Agreement also includes events of default customary for financings of this type, in certain cases subject to customary periods to cure, following which the lenders may accelerate all amounts outstanding under the loan.
VERO Biotech LLC (formerly known as Geno LLC) received FDA approval for their delivery system GENOSYL DS for HRF associated with PPHN in 2019 and received FDA approval for a third generation of that delivery system in 2023. In addition, other companies may be developing inhaled NO delivery systems at various concentrations.
VERO Biotech LLC received FDA approval for their delivery system GENOSYL DS for HRF associated with PPHN in 2019 and received FDA approval for a third generation of that delivery system in 2023. In addition, other companies may be developing inhaled NO delivery systems at various concentrations.
Our assets or cash flow may not be sufficient to fully repay our obligations under the Loans if the obligations thereunder are accelerated upon any events of default.
Our assets or cash flow may not be sufficient to fully repay our obligations under the Loan Agreement if the obligations thereunder are accelerated upon any events of default.
Risks Related to the Ownership of our Common Stock Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware will be the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware will be the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
These risks include, among others, that: ● we are a medical device and biopharmaceutical company with only one FDA-approved product and a limited operating history on which to assess our business, have incurred significant losses since our inception and incurred a net cash used in operating activities for the year ended March 31, 2024 of approximately $56.0 million.
These risks include, among others, that: ● we are a medical device and biopharmaceutical company with only one FDA/CE-approved product and a limited operating history on which to assess our business, have incurred significant losses since our inception and incurred a net cash used in operating activities for the year ended March 31, 2025 of approximately $38.2 million.
Although we attempt to effectively manage the business relationships with companies in our supply chain, we do not have control over their operations. 59 We require a supply of LungFit ® PH for sale in the United States, and we will require a supply of LungFit ® PH for sale in international markets if we obtain certification or marketing approvals outside of the United States.
Although we attempt to effectively manage the business relationships with companies in our supply chain, we do not have control over their operations. 58 We require a supply of LungFit ® PH for sale in the United States and international markets.
Our Loan Agreement contains restrictions that limit our flexibility in operating our business. The Loan Agreement contains various covenants that limit our ability to engage in specified types of transactions without the prior consent of the Agent and the Lenders.
The foregoing would materially and adversely affect the ongoing viability of our business. Our Loan Agreement contains restrictions that limit our flexibility in operating our business. The Loan Agreement contains various covenants that limit our ability to engage in specified types of transactions without the prior consent of the lenders.
In the event that we breach one or more covenants, the Agent at the direction of the Lenders may choose to declare an event of default and require that we immediately repay all amounts outstanding under the Loan Agreement, plus penalties and interest, terminate the Lenders’ commitments to fund any undrawn tranches and foreclose on the collateral granted to them to secure the obligations under the Agreement and the other loan documents.
In the event that we breach one or more covenants, the lenders may choose to declare an event of default and require that we immediately repay all amounts outstanding under the Loan Agreement, plus penalties and interest and foreclose on the collateral granted to them to secure the obligations under the Loan Agreement.
Third Pole has reported the development of an NO generator and delivery system, but we are not aware of any display of any product at any medical/scientific conference in recent years.
Third Pole has reported the development of an NO generator and delivery system, but we are not aware of any display of any product at any medical/scientific conference in recent years. Our patents surrounding LungFit ® have priority date over those of Third Pole.
In addition, as the regulatory environment related to information security, data collection and use, and privacy becomes increasingly rigorous, with new and constantly changing requirements applicable to our business, compliance with those requirements could also result in additional costs.
In addition, as the regulatory environment related to information security, data collection and use, and privacy becomes increasingly rigorous, with new and constantly changing requirements applicable to our business, compliance with those requirements could also result in additional costs. Risks Related to the Ownership of our Common Stock We are currently listed on The Nasdaq Capital Market.
As of March 31, 2024, we have an accumulated deficit of approximately $239.7 million and we anticipate to continue to incur significant losses for the foreseeable future; ● we are unable to predict the extent of future losses or when we will become profitable based on the sale of any product, if at all.
As of March 31, 2025, we have an accumulated deficit of approximately $286.3 million and we anticipate losses declining in fiscal 2026 and 2027. ● we are unable to predict the extent of future losses or when we will become profitable based on the sale of any product, if at all.
Risks Related to Our Financial Position and Capital Requirements Numerous factors, including the incurring of significant losses, are relevant to our financial success and any or all such factors could have a disproportionate impact on our bottom line.
Investors should consider the substantial risks and uncertainties inherent in the Company’s business before investing in the Company’s securities. Numerous factors, including the incurring of significant losses, are relevant to our financial success and any or all such factors could have a disproportionate impact on our bottom line.
Our patents surrounding LungFit ® have priority date over those of Third Pole.] In addition to NO treatments currently available or under development, we also face competition from non-NO-based drugs and therapies. For example, the successful development of immunizations for bronchiolitis may render useless any product we develop for that indication.
In addition to NO treatments currently available or under development, we also face competition from non-NO-based drugs and therapies. For example, the successful development of immunizations for bronchiolitis may render useless any product we develop for that indication. Also, antibiotic treatments for infections associated with CF and other underlying lung conditions may be preferred over any product that we develop.
These covenants limit our ability to, among other things: ● sell, transfer, lease or dispose of our assets; ● create, incur or assume additional indebtedness; ● encumber or permit liens on certain of our assets; ● make restricted payments, including paying dividends on, repurchasing or making distributions with respect to our common stock; ● make specified investments (including loans, guaranties and advances); ● consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; ● enter into certain transactions with our affiliates; and ● permit our unrestricted cash held in certain deposit accounts to at any time be less than $5,000,000.
These covenants limit our ability to, among other things: ● create, incur or assume additional indebtedness; ● subject to certain exceptions, make restricted payments, including paying dividends on, repurchasing or making distributions with respect to our common stock; and ● consolidate, merge, sell or otherwise dispose of all or substantially all of our assets.
Competition may increase further as a result of advances in the commercial applicability of technologies and greater availability of capital for investment in these industries.
Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large, established companies. Competition may increase further as a result of advances in the commercial applicability of technologies and greater availability of capital for investment in these industries.
As a result, these companies may obtain certification or regulatory approval more rapidly than we are able to and may be more effective in selling and marketing their products as well. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large, established companies.
Additional mergers and acquisitions in the medical device, biotechnology and pharmaceutical industries may result in even more resources being concentrated in our competitors. As a result, these companies may obtain certification or regulatory approval more rapidly than we are able to and may be more effective in selling and marketing their products as well.
In the year ended March 31, 2023, the Company purchased approximately 80% of its materials from two third-party vendors, with these vendors representing 67% and 13%, respectively.
In the year ended March 31, 2024, the Company purchased approximately 75% of its materials from a third-party vendor.
The Loan Agreement also contains affirmative and negative covenants customary for financings of this type that, among other things, limit the ability of the Company and its subsidiaries to (i) incur additional debt, guarantees or liens; (ii) pay any dividends; (iii) enter into certain change of control transactions; (iv) sell, transfer, lease, license, or otherwise dispose of certain assets; (v) make certain investments or loans; and (vi) engage in certain transactions with related persons, in each case, subject to certain exceptions.
The Loan Agreement contains affirmative and negative covenants customary for financings of this type that, among other things, limit the ability of the Company and its subsidiaries to incur additional debtor or pay any dividends.
Some of our competitors have substantially greater financial, technical and other resources, such as larger research and development staff and experienced marketing and manufacturing organizations. Additional mergers and acquisitions in the medical device, biotechnology and pharmaceutical industries may result in even more resources being concentrated in our competitors.
Even if we successfully develop our product candidates, and obtain certification or approval for them, other treatments may be preferred and we may not be successful in commercializing our product candidates. Some of our competitors have substantially greater financial, technical and other resources, such as larger research and development staff and experienced marketing and manufacturing organizations.
The Loans bear interest at a rate per annum (subject to increase during an event of default) equal to the greater of (i) the prime rate, as published by the Wall Street Journal from time to time, plus 3.75% and (ii) 12.00%.
The loan bears interest at a rate per annum (subject to increase during an event of default) equal to 15% of which 3% shall be payable in cash and 12% payable in kind through June 30, 2026 and thereafter all in cash.
Removed
On June 15, 2023 (the “Closing Date”), Beyond Air, Inc. and its wholly-owned subsidiary, Beyond Air Ltd., entered into a Loan and Security Agreement (the “Loan and Security Agreement”) with Avenue Capital Management II, L.P., as administrative agent and collateral agent (the “Agent”), Avenue Venture Opportunities Fund, L.P., a Delaware limited partnership (“Avenue”), and Avenue Venture Opportunities Fund II, L.P, a Delaware limited partnership (“Avenue 2” and, together with Avenue, the “Lenders”) .
Added
Risks Related to Our Financial Position and Capital Requirements Our independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going concern.” The Company has incurred recurring net losses, including a net loss of $48.5 million for the year ended March 31, 2025, compared to $64.3 million for the year ended March 31, 2024 and the Company’s operations have not provided net positive cash flows in the year ended March 31, 2025.
Removed
Also on June 15, 2023, the Company entered into a Supplement to the Loan and Security Agreement (collectively with the Agreement, the “Loan Agreement”) with the Agent and the Lenders.
Added
These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to generate positive cash flows from operations and to secure additional sources of equity and/or debt financing.
Removed
The Loan Agreement provides for senior secured term loans (the “Loans”) in an aggregate principal amount up to $40.0 million, with (i) $17.5 million advanced on the Closing Date (“Tranche 1”), (ii) up to $10.0 million which may be advanced upon the request of the Company between April 1, 2024 and September 30, 2024, subject to the Company having achieved total revenue derived from the sale of LungFit ® PH (other than licensing revenue) (“Product Revenue”) for the three-month period prior to funding of not less than 85% of projected Product Revenue for such period (“Tranche 2”), and (iii) up to $12.5 million which may be advanced after April 1, 2024 (the “Discretionary Tranche”), subject to (a) the Agent and Lenders having received investment committee approval and (b) the Company and Lenders having mutually agreed to draw and fund such amount.
Added
Despite the Company’s intent to fund operations through equity and debt financing arrangements, there is no assurance that such financing will be available on terms acceptable to the Company, if at all.
Removed
The Loans are due and payable on June 1, 2027 (the “Maturity Date”).
Added
Our independent auditors have included an explanatory paragraph in their audit report, included in this Annual Report on Form 10-K, regarding the Company’s ability to continue as a going concern.
Removed
The Loan principal is repayable in equal monthly installments beginning on January 1, 2025, with the possibility of deferring principal payments an additional 6 to 18 months contingent upon the Company’s achievement of at least $40.0 million of Product Revenue in the fiscal year ending March 31, 2025, provided the Company has fully drawn Tranche 2.
Added
This going concern risk may materially limit our ability to raise additional funds through the issuance of new debt or equity or may adversely affect the terms upon which such capital may be available. The inability to obtain sufficient financing on acceptable terms could have a material adverse effect on the Company’s financial condition, results of operations, and business prospects.
Removed
The Company may, subject to certain parameters, voluntarily prepay the Loans, in whole or in part, at any time.
Added
The Company is actively pursuing strategies to mitigate these risks. However, there can be no assurance that these efforts will prove successful or that the Company will achieve its intended financial stability. The failure to successfully address these going concern risks may materially and adversely affect the Company’s business, financial condition, and results of operations.
Removed
If prepayment occurs on or before the one-year anniversary of the Closing Date, the Company is required to pay a fee equal to the principal amount of the Loans prepaid multiplied by 3.00%; if prepayment occurs after the one-year anniversary of the Closing Date and on or before the two-year anniversary of the Closing Date, the Company is required to pay a fee equal to the principal amount of the Loans prepaid multiplied by 2.00%; if prepayment occurs after the two-year anniversary and on or before the three-year anniversary of the Closing Date, the Company is required to pay a fee equal to the principal amount of the Loans prepaid multiplied by 1.50%; and if prepayment occurs after the three-year anniversary of the Closing Date and before the Maturity Date, the Company is required to pay a fee equal to the principal amount of the Loans prepaid multiplied by 1.00%.
Added
On November 1, 2024, the Company entered into a loan and security agreement (the “Loan Agreement”) for a secured loan with certain lenders including its Chief Executive Officer and Chairman Steven Lisi and director Robert Carey. The Loan Agreement provides for a $11,500,000 loan.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThese events could lead to the unauthorized access of our information technology systems and result in financial loss and the misappropriation or unauthorized disclosure of confidential information belonging to us, our employees, partners, customers, or suppliers.
Biggest changeThese events could lead to unauthorized access to our information technology systems and result in financial loss and the misappropriation or unauthorized disclosure of confidential information belonging to us, our employees, partners, customers, or suppliers.
Our CTO, and their team, are responsible for the day-to-day management of the cybersecurity program. 74 The CTO provides periodic briefings for our senior management team on cybersecurity matters, including the prevention, detection, mitigation, and remediation of cybersecurity incidents and cybersecurity threats.
Our CTO, and their team, are responsible for the day-to-day management of the cybersecurity program. 73 The CTO provides periodic briefings for our senior management team on cybersecurity matters, including the prevention, detection, mitigation, and remediation of cybersecurity incidents and cybersecurity threats.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe also lease office space in Garden City, New York under a lease that expires in June 2025, an office in Atlanta, Georgia under a lease that expires in September 2026, an office in Dublin, Ireland under a lease that expires in September 2028 and office spaces in Rehovot, Israel under several lease agreements that expire over the course of the next fiscal year.
Biggest changeWe have an office in Dublin, Ireland under a lease that expires in September 2028 and an office space in Rehovot, Israel under a lease that expires over the course of the next fiscal year. The Company has a research and development facility in Madison, Wisconsin under a lease that expires in May 2026.
ITEM 2. PROPERTIES As of March 31, 2024, the Company leased facilities for corporate and R&D purposes at locations throughout the United States and in various locations outside of the United States. Our executive office is located at 900 Stewart Avenue, Suite 310, Garden City, NY 11530 under a lease that expires in June 2031.
ITEM 2. PROPERTIES As of June 18, 2025, the Company leased facilities for corporate and R&D purposes at locations throughout the United States and in various locations outside of the United States. Our executive office is located at 900 Stewart Avenue, Suite 310, Garden City, NY 11530, and is under a lease that expires in June 2031.
The Company has a research and development facility in Madison, Wisconsin under a lease that expires in May 2026. The Company believes the existing facilities which are used by all reportable segments and are in good operating condition and are suitable for the conduct of its business.
The Company believes the existing facilities which are used by all reportable segments of the Company and are in good operating condition and are suitable for the conduct of its business.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeFrom time to time, the Company is involved in various legal matters arising in the normal course of business. The Company does not expect the outcome of such proceedings, either individually or in aggregate, to have a material effect on its financial position, cash flows or results of operations. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 75 PART II
Biggest changeAt the same time, the Company does not expect the outcome of such proceedings, either individually or in aggregate, to have a material effect on its financial position, cash flows or results of operations. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 74 PART II
Removed
ITEM 3. LEGAL PROCEEDINGS In April 2023, the Company paid a total of $7.6 million, including damages and interest, in satisfaction of judgment in resolution of Empery Asset Master, Ltd., et. al. vs. AIT Therapeutics, Inc. (the “Empery Suit”). This payment in connection with the Empery Suit had been included in accrued liabilities for the year ended March 31, 2023.
Added
ITEM 3. LEGAL PROCEEDINGS From time to time, the Company is involved in various legal matters arising in the normal course of business. Litigation and other disputes are inherently unpredictable and subject to substantial uncertainties and unfavorable resolutions could occur.
Removed
In December 2021, Hudson Bay Master Fund (“Hudson”) filed a lawsuit in the Supreme Court of the State of New York against the Company relating to the notice of adjustment of the exercise price of and the number of warrant shares issuable under warrants issued to Hudson in January 2017.
Removed
Hudson received 83,334 warrants in connection with the January 2017 offering. Hudson’s complaint alleged breach of contract and that Hudson is entitled to damages and interest as a result of certain adjustments to the exercise price and number of warrant shares issuable following a February 2018 financing transaction.
Removed
The lawsuit was settled in July 2023, and the Company paid $3.1 million for defense and indemnity costs in the quarter ended September 30, 2023. As of March 31, 2024 and March 31, 2023, $0 and $2.7 million, respectively, were included in accrued liabilities.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 75 PART II 76 Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 76 Item 6. (Reserved) 76 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 77 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 83 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 74 PART II 75 Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 75 Item 6. (Reserved) 75 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 76 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 82 Item 8.
Financial Statements and Supplementary Data 83 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 83 Item 9A. Controls and Procedures 84
Financial Statements and Supplementary Data 82 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 82 Item 9A. Controls and Procedures 83

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeStockholders As of June 24, 2024, there were approximately 105 holders of record for shares of our common stock. This does not reflect beneficial stockholders who held their common stock in “street” or nominee name through brokerage firms.
Biggest changeOn June 18, 2025, the closing price for our common stock as reported on The Nasdaq Capital Market was $0.2023 per share. Stockholders As of June 18, 2025, there were approximately 97 holders of record for shares of our common stock. This does not reflect beneficial stockholders who held their common stock in “street” or nominee name through brokerage firms.
We currently intend to retain all available funds and any future earnings to support our operations and finance the growth and development of our business. We do not intend to pay cash dividends on our common stock for the foreseeable future. Unregistered Sales of Equity Securities (a) Sales of Unregistered Securities None. (b) Use of Proceeds None.
We currently intend to retain all available funds and any future earnings to support our operations and finance the growth and development of our business. We do not intend to pay cash dividends on our common stock for the foreseeable future.
Added
Unregistered Sales of Equity Securities (a) Sales of Unregistered Securities During the year ended March 31, 2025, the Company issued only unregistered equity securities previously reported in the Current Reports on Form 8-K and in the Quarterly Reports on Form 10-Q filed by the Company with the SEC. (b) Use of Proceeds None. (c) Issuer Purchases of Equity Securities None.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeTo date, there have been no material differences between our estimates of such expenses and the amounts actually incurred. 78 Results of Operations and Other Comprehensive Loss (in thousands, except number of shares and loss per share) Year Ended March 31, 2024 Year Ended March 31, 2023 Revenue $ 1,159 $ - Cost of revenue (2,466 ) (555 ) Gross loss (1,307 ) (555 ) Research and development (24,363 ) (16,810 ) General and administrative (37,337 ) (34,694 ) Total operating expenses (61,700 ) (51,504 ) Loss from operations (63,006 ) (52,059 ) Estimated contingent loss (598 ) (7,863 ) Dividend and interest income 1,739 656 Interest and finance expense (2,912 ) (30 ) Change in fair value of warrant liability 611 - Change in fair value of derivative liability 48 - Foreign Exchange loss (6 ) (105 ) Other expense (169 ) - Total other income/(expense) (1,288 ) (7,342 ) Net loss before income taxes (64,295 ) (59,401 ) Provision for income taxes - - Net loss $ (64,295 ) $ (59,401 ) Less: Net loss attributable to non-controlling interest (4,053 ) (3,585 ) Net loss attributed to Beyond Air, Inc. $ (60,242 ) $ (55,816 ) Other comprehensive income: Foreign currency translation gain / (loss) (68 ) (43 ) Comprehensive loss attributable to Beyond Air, Inc.
Biggest changeTo date, there have been no material differences between our estimates of such expenses and the amounts actually incurred. 77 Results of Operations and Other Comprehensive Loss (in thousands, except number of shares and loss per share) Year Ended March 31, 2025 Year Ended March 31, 2024 Revenues $ 3,705 $ 1,159 Cost of revenues (5,368 ) (2,466 ) Gross loss (1,663 ) (1,307 ) Operating expenses: Research and development (16,857 ) (24,363 ) Selling, general and administrative (26,017 ) (37,337 ) Total Operating expenses (42,874 ) (61,700 ) Loss from Operations (44,537 ) (63,006 ) Estimated contingent loss - (598 ) Dividend/investment income 705 1,739 Interest and finance expense (3,019 ) (2,912 ) Change in fair value of warrant liability 237 611 Change in fair value of derivative liability 1,314 48 Loss on extinguishment of debt (2,447 ) - Loss on disposal/impairment of fixed assets (738 ) - Foreign exchange (loss) (3 ) (6 ) Other income/(expense) 9 (169 ) Total other income/(expense) (3,942 ) (1,288 ) Net loss before income taxes (48,479 ) (64,295 ) Provision for income taxes - - Net loss $ (48,479 ) $ (64,295 ) Less: net loss attributable to non-controlling interest (1,854 ) (4,053 ) Net loss attributed to Beyond Air, Inc. $ (46,625 ) $ (60,242 ) Other comprehensive income: Foreign currency translation (loss) (45 ) (68 ) Comprehensive loss attributable to Beyond Air, Inc (46,670 ) (60,310 ) Net basic and diluted loss per share attributable to Beyond Air, Inc. $ (0.69 ) $ (1.82 ) Weighted average number of shares of common stock outstanding – basic and diluted 67,706,527 33,160,180 78 Comparison of the year ended March 31, 2025 to the year ended March 31, 2024 Revenue and Cost of Revenue $3.7 million and $1.2 revenue was recognized for the years ended March 31, 2025 and March 31, 2024 respectively.
It also includes the research and development vendors providing us milestone and percentage of completion reports on the statuses within each active purchase order and contract along with estimating the level of service performed and the associated cost incurred for the services when we have not yet been invoiced or otherwise notified of the actual cost.
It also includes the research and development vendors providing us with milestone and percentage of completion reports on the statuses within each active purchase order and contract along with estimating the level of service performed and the associated cost incurred for the services when we have not yet been invoiced or otherwise notified of the actual cost.
Our future capital requirements will depend on many factors, including: ● the progress and costs of our preclinical studies, clinical trials and other research and development activities; ● the costs of commercializing the LungFit ® system; ● the scope, prioritization and number of our clinical trials and other research and development programs; ● the costs and timing of obtaining certification or regulatory approval for our product candidates; ● the costs of filing, prosecuting, enforcing and defending patent claims and other intellectual property rights; ● the costs of, and timing for, strengthening our manufacturing agreements for production of sufficient clinical quantities of our product candidate; ● the potential costs of contracting with third parties to provide marketing and distribution services for us or for building such capacities internally; ● the costs of acquiring or undertaking the development and commercialization efforts for additional, future therapeutic applications of our product candidate; ● the magnitude of our general and administrative expenses; and ● any cost that we may incur under current and future in-licensing and out-licensing arrangements relating to our product candidate.
Our future capital requirements will depend on many factors, including: ● the progress and costs of our preclinical studies, clinical trials and other research and development activities; ● the costs of commercializing the LungFit ® system; ● the scope, prioritization and number of our clinical trials and other research and development programs; ● the costs and timing of obtaining certification or regulatory approval for our product candidates; ● the costs of filing, prosecuting, enforcing and defending patent claims and other intellectual property rights; ● the costs of, and timing for, strengthening our manufacturing agreements for production of sufficient clinical quantities of our product candidates; ● the potential costs of contracting with third parties to provide marketing and distribution services for us or for building such capacities internally; ● the costs of acquiring or undertaking the development and commercialization efforts for additional, future therapeutic applications of our product candidates; ● the magnitude of our general and administrative expenses; and ● any cost that we may incur under current and future in-and-out-licensing arrangements relating to our product candidates.
Our vendors invoice us in various ways via advance payments, as contractual milestones are met or monthly in arrears for services performed. 77 We make estimates of our accrued expenses as of each balance sheet date in our consolidated financial statements based on facts and circumstances known to us at that time.
Our vendors invoice us in various ways via advance payments, as contractual milestones are met, or monthly in arrears for services performed. 76 We make estimates of our accrued expenses as of each balance sheet date in our consolidated financial statements based on facts and circumstances known to us at that time.
We will be required to raise additional funds through sale of equity or debt securities or through strategic collaborations and/or licensing agreements in order to fund operations until we are able to generate enough product or royalty revenues, if any.
We may be required to raise additional funds through sale of equity or debt securities or through strategic collaborations and/or licensing agreements in order to fund operations until we are able to generate enough product or royalty revenues, if any.
Our ability to continue to operate beyond the first fiscal quarter of 2025 will be largely dependent upon the successful commercial launch of LungFit ® PH, as well as obtaining partners in other parts of the world, and raising additional funds to finance our activities until we are generating cash flow from operations.
Our ability to continue to operate beyond the third fiscal quarter of 2026 will be largely dependent upon the successful commercial launch of LungFit ® PH, as well as obtaining partners in other parts of the world, and raising additional funds to finance our activities until we are generating cash flow from operations.
Comparison between Fiscal Years Ended March 31, 2024 and March 31, 2023 Cash Flows Below is a summary of the statements of cash flows for the years ended March 31, 2024 and March 31, 2023.
Comparison between Fiscal Years Ended March 31, 2025 and March 31, 2024 Cash Flows Below is a summary of the statements of cash flows for the years ended March 31, 2025 and March 31, 2024.
Our first device, LungFit ® PH received premarket approval (“PMA”) from the FDA in June 2022.
The Company’s first device, LungFit ® PH received premarket approval (“PMA”) from the FDA in June 2022.
In addition to the above-mentioned programs, we have two subsidiaries that are currently engaging in novel preclinical stage pharmaceutical research, Beyond Cancer, Ltd. and Beyond Air Cyprus.
In addition to the above-mentioned programs, we have two subsidiaries that are currently engaging in novel preclinical stage pharmaceutical research, Beyond Cancer and NeuroNos.
For the year ended March 31, 2023, cash used in investing activities was $20.6 million which was primarily from investments in marketable securities from net proceeds received from the purchase and sale of marketable securities of $16.7 million in the fiscal year, and the purchase of property and equipment for $3.9 million. 82 Financing Activities For the year ended March 31, 2024, net cash provided by financing activities was $43.2 million, mainly from the Loan Agreement of which the net proceeds were $15.8 million, the issuance of common stock in connection with the 2022 ATM of $13.4 million, and the registered direct offering (the “Registered Offering”) pursuant to a securities purchase agreement dated March 20, 2024 with Roth Capital Partners, LLC and Laidlaw & Company (UK) Ltd. of $14.6 million , the issuance of common stock in connection with the exercise of options ($0.2 million) partially offset by $0.8 million from the payment of short-term loans.
For the year ended March 31, 2024, net cash provided by financing activities was $43.2 million, mainly from the Loan Agreement of which the net proceeds were $15.8 million, the issuance of common stock in connection with the 2022 ATM of $13.4 million, and the registered direct offering (the “Registered Offering”) pursuant to a securities purchase agreement dated March 20, 2024 with Roth Capital Partners, LLC and Laidlaw & Company (UK) Ltd. of $14.6 million , the issuance of common stock in connection with the exercise of options ($0.2 million) partially offset by $0.8 million from the payment of short-term loans.
Net Loss Attributable to Non-controlling Interest Net loss attributed to non-controlling interest for the year ended March 31, 2024, was $4.1 million, compared to $3.6 million for the year ended March 31, 2023.
Net Loss Attributable to Non-controlling Interest Net loss attributed to non-controlling interest for the year ended March 31, 2025, was $1.9 million for the year ended March 31, 2025, compared to $4.1 million for the year ended March 31, 2024.
Management believes these factors raise substantial doubt about the Company’s ability to meet its obligations with cash on hand and concluded that the Company will require additional funding within one year from the date these financial statements are issued.
We expect to incur net losses and have significant cash outflows for at least the next twelve months. Management believes these factors raise substantial doubt about the Company’s ability to meet its obligations with cash on hand and concluded that the Company will require additional funding within one year from the date these financial statements are issued.
Net Loss Attributed to Common Stockholders Net loss attributed to common stockholders for the year ended March 31, 2024, was $60.3 million or a loss of $1.82 per share, basic and diluted, as a result of the foregoing.
Net Loss Attributed to Common Stockholders Net loss attributed to common stockholders for the year ended March 31, 2025, was $46.6 million or a loss of $0.69 per share, basic and diluted, as a result of the foregoing.
(in thousands) For The Year Ended March 31, 2024 For The Year Ended March 31, 2023 Net cash provided by (used in): Operating activities $ (56,014 ) $ (33,009 ) Investing activities $ (12,235 ) $ (20,587 ) Financing activities $ 43,167 $ 2,696 Effect of exchange rate changes on cash and cash equivalents $ (77 ) $ (43 ) Net decrease in cash, cash equivalents and restricted cash $ (25,160 ) $ (50,944 ) Operating Activities For the year ended March 31, 2024, net cash used by operating activities was $56.0 million, which was primarily due to our net loss of $64.3 million, which includes $21.3 million of stock-based compensation, $0.4 million received in grant payments, $2.0 million of depreciation and amortization partially offset by a $1.6 million increase in prepaid accounts, a $0.3 million increase in accounts receivable, a $1.0 million increase in inventory, ($3.5) million in payment of the second tranche of a May 2021 settlement with Circassia, ($2.9) million for the Hudson settlement and ($7.6) million attributable to the resolution of the Empery Suit.
For the year ended March 31, 2024, net cash used by operating activities was $56.0 million, which was primarily due to our net loss of $64.3 million, which includes $21.3 million of stock-based compensation, $0.4 million received in grant payments, $2.0 million of depreciation and amortization partially offset by a $1.6 million increase in prepaid accounts, a $0.3 million increase in accounts receivable, a $1.0 million increase in inventory, ($3.5) million in payment of the second tranche of a May 2021 settlement with Circassia, ($2.9) million for the Hudson settlement and ($7.6) million attributable to the resolution of the Empery Suit.
On February 4, 2022, we entered into an At-The-Market Equity Offering Sales Agreement with Truist Securities, Inc. and Oppenheimer & Co, Inc. (the “2022 ATM”). Under the 2022 ATM, we may sell shares of our common stock having aggregate sales proceeds of up to $50.0 million, from time to time and at various prices.
On February 10, 2025, we entered into the At-The Market Offering Sales Agreement with BTIG, Inc. (the “2025 ATM”). Under the 2025 ATM, we may sell shares of our common stock having aggregate sales proceeds of up to $35.0 million, from time to time and at various prices.
Investing Activities For the year ended March 31, 2024, cash used in investing activities was $12.2 million which was primarily from investments in marketable securities from net proceeds received from the purchase and sale of marketable securities of $6.5 million in the fiscal year, and the purchase of property and equipment for $5.7 million.
Investing Activities For the year ended March 31, 2025, cash provided by investing activities was $14.9 million which was primarily from investments in marketable securities from net proceeds received from the purchase and sale of marketable securities of $20.8 million in the fiscal year, and the purchase of property and equipment for $5.9 million.
The $6.0 million decrease in expenses is mainly due to a change in fair value of warrant liability of $0.6 million on the Loan and Security Agreement, $1.1 million of interest and dividend income from our investments in marketable securities and $7.9 million incurred in the prior year related to the Empery Suit and Hudson suit, partially offset by an increase in interest and finance expense of $2.9 million, and $0.6 million of non-product related litigation.
The $2.6 million increase in expense is mainly due to a loss on the extinguishment of debt of $2.4 million, a decrease in interest and dividend income from our investments in marketable securities of $1.0 million, a loss in disposal of fixed assets of $0.2 million, an impairment of fixed assets $0.5 million and a change in the fair value of warrant liability of $0.4 million on the Loan and Security Agreement, offset by a decrease of $0.6 million of non-product related litigation and change in fair value of the derivative liability of $1.3 million on the Loan and Security Agreement.
Other Income and Expense Net other expense for the year ended March 31, 2024 and March 31, 2023 were $1.3 million and $7.3 million, respectively.
Other Income and Expense Other expenses for the year ended March 31, 2025 and March 31, 2024, was $3.9 million and of $1.3 million, respectively.
Further, there are no assurances that we will be successful in obtaining an adequate level of financing for the development and commercialization of our other product candidates. 81 There are numerous risks and uncertainties associated with the development of our NO delivery system and we are unable to estimate the amounts of increased capital outlays and operating expenses associated with completing the research and development of our product candidates.
There are numerous risks and uncertainties associated with the development of our NO delivery system and we are unable to estimate the amounts of increased capital outlays and operating expenses associated with the completion of the research and development of our product candidates. 80 There are numerous risks and uncertainties associated with the development of our NO delivery system and we are unable to estimate the amounts of increased capital outlays and operating expenses associated with completing the research and development of our product candidates.
Cost of revenue of $2.5 million and gross losses of $1.3 million were recognized for the year ended March 31, 2024 compared to a cost of revenue of $0.6 million and gross losses of $0.6 million for the year ended March 31, 2023. The increase in revenue was due to our commercial product launch in June 2022.
Cost of revenue of $5.4 million and gross losses of $1.7 million were recognized for the year ended March 31, 2025 compared to a cost of revenue of $2.5 million and gross losses of $1.3 million for the year ended March 31, 2024. The increase in revenue was due to additional hospital contracts in the United States market.
General and Administrative Expenses General and administrative expense for the years ended March 31, 2024 and March 31, 2023 were $37.3 million and $34.7 million, respectively.
Selling, General and Administrative Expenses Selling, general and administrative expenses for the year ended March 31, 2025 and March 31, 2024 were $ 26. 0 million and $37.3 million, respectively.
Additionally, beginning in year three post-approval, Circassia will receive a quarterly royalty payment equal to 5% of LungFit ® PH net sales in the U.S. $4.5 million is included in accrued liabilities at March 31, 2024 and will be paid in the second fiscal quarter of 2025.
Additionally, beginning in the third fiscal quarter of 2025, Circassia will receive a quarterly royalty payment equal to 5% of LungFit ® PH net sales in the U.S. until the final $6.0 million has been paid. As of March 31, 2025, less than $0.1 million of royalty has been paid.
The increase of $2.7 million was attributed primarily to an increase in salaries of $1.6 million ($0.9 million in Beyond Air and of $0.7 million in Beyond Cancer) mainly driven by an increase of 12 positions globally, an increase in stock-based compensation of $1.5 million ( an increase of $3.4 million in Beyond Air and offset by a decrease of $1.9 million in Beyond Cancer), rent ($0.1 million), consulting fees in relation to international expansion and patent protections ($0.9 million) depreciation ($0.2 million) and IT expenses ($0.2 million) offset by a reduction in marketing and evaluation expenses ($0.4 million), legal fees ($1.2 million) and insurance expenses ($0.1 million).
The decrease of $1 1.3 million was attributed primarily to a decrease in spend in salaries $1.8 million ($2.7 million in Beyond Air offset by an increase of $0.9 million in Beyond Cancer), $ 8.3 million due to stock based compensation cost ($2.3 million in Beyond Air and $6.0 million in Beyond Cancer), $0.6 million professional fees ($0.8 million in Beyond Air offset by increased spend $0.1 million in Beyond Cancer and $0.1 million in NeuroNos), $0.3 million marketing and advertising costs for Beyond Air, $0.4 million rent costs ($0.2 million in Beyond Air and $0.2 million in Beyond Cancer), $0.4 million travel costs ($0.3 million in Beyond Air and $0.1 million in Beyond Cancer) offset by an increase in Beyond Air of $0.4 million in legal fees and $0.2 million in royalty payments.
If shares of our common stock are sold, there is a 3% fee paid to the sales agent. As of March 31, 2024, there was a balance of $32.9 million available under the 2022 ATM.
If shares of our common stock are sold, there is a 2.5% fee paid to the sales agent.
Cost of revenue exceeded revenue primarily driven by costs of supply chain infrastructure required to grow revenue in future periods and depreciation of devices purchased but not yet deployed. Research and Development Research and development expenses for the year ended March 31, 2024 were $24.4 million, as compared to $16.8 million for the year ended March 31, 2023.
Cost of revenue exceeded revenue primarily driven by costs of supply chain infrastructure required to grow revenue in future periods and depreciation of additional LungFit ® devices purchased in the year.
The increase of $7.6 million was attributed primarily to an increase in expenditures on clinical trials ($3.6 million) and preclinical studies ($0.2 million), an increase in salaries ($2.7 million) and stock-based compensation benefits ($0.3 million) and an increase in expenditures on professional fees ($0.7 million).
The decrease of $7.5 million was primarily attributed to a decrease in spend in salaries $1.5 million in Beyond Air, stock-based compensation $ 4.0 million ( $0.7 million in Beyond Air and $3.3 million in Beyond Cancer), pre-clinical studies $1.1 million reduced spend in Beyond Cancer on device development costs, clinical studies $1.9 million ( $1.5 million in Beyond Air and $0.4 million in Beyond Cancer), professional fees $1.0 million ( $0.6 million in Beyond Air and $0.4 million in Beyond Cancer) and travel expenses $0.2 million.
On May 25, 2021, the Company and Circassia entered into the Settlement Agreement resolving all claims by and between both parties and mutually terminating the Circassia Agreement.
On May 25, 2021, the Company and Circassia entered into a settlement agreement (“the Settlement Agreement”) resolving all claims by and between the parties and mutually terminating the agreement with Circassia disclosed in Note 9 to our financial statements for the fiscal year ended March 31, 2025.
Our net loss attributed to common stockholders for the year ended March 31, 2023, was $55.8 million or a loss of $1.86 per share, basic and diluted. 80 Liquidity and Capital Resources We started generating costs related to the commercial launch since obtaining regulatory approval for the LungFit ® PH at the end of the first quarter of fiscal 2023 and started to generate revenue in the first fiscal quarter of 2024.
Our net loss attributed to common stockholders for the year ended March 31, 2024, was $60.3 million or a loss of $1.82 per share, basic and diluted. 79 Liquidity and Capital Resources We have generated revenue of $4.9 million from the sale of products to date.
Non-controlling interest represents 20% of the net loss of our Beyond Cancer subsidiary which was established in November 2021 and the increase in net loss is reflective of the increase in spend in Beyond Cancer since its inception in late 2021.
Non-controlling interest represents 20% of the net loss of our Beyond Cancer subsidiary and 11.76% of the net loss of our NeuroNos subsidiary. The year-on-year variance is due to a decrease in the net loss of Beyond Cancer partially offset by the loss in NeuroNos, which the non-controlling interest was established in the current fiscal year.
We have generated $1.1 million from the sale of products to date. We used cash flow in operations of $56.0 million for the year ended March 31, 2024 and we have experienced an accumulated deficit of $239.7 million since inception through March 31, 2024.
We had an operating cash flow decrease of $38.2 million for the year ended March 31, 2025 and we have experienced an accumulated loss of $286.3 million since inception through March 31, 2025. As of March 31, 2025, we had cash, cash equivalents and marketable securities of $6.9 million and $0.2 million in restricted cash.
LungFit ® can be used to treat patients on ventilators that require NO, as well as patients with chronic or acute severe lung infections via delivery through a breathing mask or similar apparatus. Furthermore, we believe that there is a high unmet medical need for patients suffering from certain severe lung infections that the LungFit ® platform can potentially address.
Furthermore, we believe that there is a high unmet medical need for patients suffering from certain severe lung infections that the LungFit ® platform can potentially address. The Company’s other areas of focus with the LungFit ® platform beyond PPHN are nontuberculous mycobacteria (“NTM”) lung infection and those with various severe lung infections with underlying chronic obstructive pulmonary disease (“COPD”).
For the year ended March 31, 2023, net cash used by operating activities was $33.0 million, which was primarily due to our net loss of $59.4 million, which included non-cash stock-based compensation of $19.6 million and an increase in accrued liabilities of $4.8 million including an increase in liabilities related to lawsuits of $7.8 million, partially offset by the payment of the first tranche of the Circassia settlement of $2.5 million.
(in thousands) For The Year Ended March 31, 2025 For The Year Ended March 31, 2024 Net cash provided by (used in): Operating activities $ (38,218 ) $ (56,014 ) Investing activities $ 14,905 $ (12,235 ) Financing activities $ 16,646 $ 43,167 Effect of exchange rate changes on cash and cash equivalents $ (45 ) $ (77 ) Net decrease in cash, cash equivalents and restricted cash $ (6,712 ) $ (25,160 ) Operating Activities For the year ended March 31, 2025, net cash used by operating activities was $38.2 million, which was primarily due to our net loss of $48.5 million which includes $9.1 million of stock-based compensation, $3.0 million of depreciation and amortization, a non-cash loss of $2.4 million on the extinguishment of debt, an impairment of fixed assets charge $0.5 million, a $0.4 million increase in accounts receivable, a $0.4 million increase in inventory, partially offset by a $1.0 million decrease in prepaid accounts, a decrease in accrued liabilities $6.4 million (which included $4.5 million in payment of the final tranche of a May 2021 settlement with Circassia).
Pursuant to the terms of the Settlement Agreement, the Company agreed to pay Circassia $10.5 million in three installments, and the first payment of $2.5 million was triggered upon FDA approval for the LungFit ® PH (fixing the Initial Payment Due Date at July 28, 2022).
Pursuant to the terms of the Settlement Agreement, the Company agreed to pay Circassia $10.5 million in three installments, all of which has been paid.
For the year ended March 31, 2023, net cash provided by financing activities was $2.7 million which was primarily from the issuance of common stock in connection with our 2022 ATM for $3.7 million, partially offset by loan payments of $1.0 million.
For the year ended March 31, 2024, cash used in investing activities was $12.2 million which was primarily from investments in marketable securities from net proceeds received from the purchase and sale of marketable securities of $6.5 million in the fiscal year, and the purchase of property and equipment for $5.7 million. 81 Financing Activities For the year ended March 31, 2025, net cash provided by financing activities was $16.6 million, mainly from the issuance of securities through securities purchase agreements which the net proceeds were $18.8 million, $11.3 million payment received on the loan agreement, and the issuance of common stock in connection with an At-The-Market Offering Sales Agreement with Truist Securities, Inc.
Removed
Our current areas of focus with LungFit ® are PPHN, viral community-acquired pneumonia (“VCAP”) including COVID-19, bronchiolitis (“BRO”), nontuberculous mycobacteria (“NTM”) lung infection and those with various severe lung infections with underlying chronic obstructive pulmonary disease (“COPD”).
Added
On November 26, 2024, the Company received European CE mark approval of the LungFit PH® system for the following: ● The treatment of infants > 34 weeks gestation with hypoxic respiratory failure associated with clinical or echocardiographic evidence of pulmonary hypertension, in order to improve oxygenation and to reduce the need for extracorporeal membrane oxygenation; and ● The treatment of peri- and post-operative pulmonary hypertension in adults and newborn infants, infants and toddlers, children and adolescents, ages 0-17 years in conjunction to heart surgery, in order to selectively decrease pulmonary arterial pressure and improve right ventricular function LungFit ® can be used to treat patients on ventilators that require NO, as well as patients with chronic or acute severe lung infections via delivery of NO at concentrations > 100 parts per million (ppm) through a breathing mask or similar apparatus.
Removed
We expect to be certified under the EU MDR in the second half of calendar year 2024. We also expect to make certain regulatory filings outside of the U.S. this year. If certifications or regulatory approvals are obtained, we anticipate to launch LungFit ® outside of the U.S. in late 2024.
Added
Research and Development Expenses Research and development expenses for the year ended March 31, 2025 were $16.9 million, as compared to $24.4 million for the year ended March 31, 2024.
Removed
(60,310 ) (55,859 ) Net loss per share – basic and diluted $ (1.82 ) $ (1.86 ) Weighted average number of shares of common stock outstanding – basic and diluted 33,160,180 29,973,639 79 Comparison of the year ended March 31, 2024 to the year ended March 31, 2023 Revenue and Cost of Revenue $1.2 million and $0 revenue was recognized for the years ended March 31, 2024 and March 31, 2023 respectively.
Added
The Company has recently signed agreements with TrillaMed (providing access to Department of Defense and Veterans Affairs hospitals), Healthcare Links (expanding access to group purchasing organizations and integrated delivery networks) and Business Asia Consultants (accelerating global expansion) which will drive increased revenues.
Removed
As of March 31, 2024, we had cash, cash equivalents and marketable securities of $34.5 million and $0.2 million in restricted cash. We expect to incur net losses and have significant cash outflows for at least the next twelve months.
Added
The Company has implemented a capital conservation strategy, reducing our back office footprint, reducing staffing levels by over 30% across the company, placing our VCAP study on hold pending future funding and adjusting our production forecasts. The Company expects an immediate benefit from these actions.
Removed
Management currently has various funding options in place to raise additional capital such as a debt line of $12.5 million with Avenue Capital, subject to Avenue Capitals investment committee approval and negotiations of the terms and conditions between both parties, an ATM sales agreement with $32.9 million of available funds, assets that can be leveraged such as Beyond Cancer, Autism, LungFit PH international partnerships, LungFit PRO international partnerships and LungFit GO partnerships.
Added
The Company’s future capital needs and the adequacy of its available funds will depend on many factors, including, but not necessarily limited to, the success and costs of commercialization of the Company’s approved product and the actual cost and time necessary for current and anticipated preclinical studies, clinical trials and other actions needed to obtain certification or regulatory approval of the Company’s product candidates.
Removed
The Company issued a callable warrant in connection with its sale of securities in March 2024 which, provided the Company attains certain revenue targets, could allow the Company to raise an additional $21.7 million in the first half of calendar 2025.
Added
On November 1, 2024, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) for a secured loan with certain lenders, including its Chief Executive Officer Steven Lisi and director Robert Carey, for an aggregate principal balance of $11.5 million.
Removed
Additionally, in January 2022 the Company filed a shelf registration statement on Form S-3, which allows the Company to offer and sell up to $200,000,000 of its equity or equity-linked securities.
Added
The Loan Agreement was approved by each of the Company’s independent and disinterested directors, following the receipt of a recommendation from an independent investment bank.
Removed
The securities purchase agreement entered into in March 2024 contains restrictions to our ability to raise additional funding on the 2022 ATM for a period of 90 days and entering into variable rate transactions for a period of 6 months.
Added
The Loan Agreement provides for the following terms: (i) principal amount of $11,500,000; (ii) ten-year term; (iii) interest of 15% per annum, of which 3% shall be payable in cash and 12% payable in kind through June 30, 2026 and thereafter all in cash; (iv) a royalty interest of 8% of the Company’s net sales on a quarterly basis from July 2026 until the facility is repaid in full; (v) the Company’s obligations will be secured by substantially all of the Company’s assets and (vi) the Company shall issue the lenders warrants to purchase shares of the Company’s common stock at an exercise price of $0.3793 per share.
Removed
With respect to Beyond Cancer, discussions are underway with investment banks to raise capital based on their most recent top line data from the phase 1a, first-in-human trial which was successful in the first 6 patients with no dose limiting toxicities at the first dose. Treatment in the next dosing cohort has begun.
Added
Subsequent to March 31, 2025, the Company received commitments from certain lenders under the Loan Agreement to provide additional financing of at least $2.0 million in aggregate principal. The additional loans are expected to be issued on terms and conditions that are materially consistent with those of the Loan Agreement.
Removed
Thereafter, the Company is to pay $3.5 million to Circassia on the first anniversary of the Initial Payment Due Date and $4.5 million on the second anniversary of the Initial Payment Due Date.
Added
On September 26, 2024, the Company, entered into a securities purchase agreement (the “Securities Purchase Agreement II”) with certain institutional and accredited investors, including certain directors and officers of the Company.
Removed
On June 15, 2023 (the closing date), we entered into the Loan Agreement with the Agent and the Lenders, providing for senior secured term loans in an aggregate principal amount of up to $40.0 million, with (i) $17.5 million advanced on the Closing Date, (ii) up to $10.0 million between April 1, 2024 and September 30, 2024, subject to our achieving revenue milestones, and (iii) up to $12.5 million after April 1, 2024, subject to mutual agreement.
Added
Pursuant to the purchase agreement, the Company sold to the investors in a private placement offering, (i) an aggregate of 24,999,999 shares of Common Stock”, at a purchase price of $0.5043 per Share, (ii) pre-funded warrants to purchase up to 15,848,712 shares of common stock at a purchase price of $0.5042 per pre-funded warrant and (iii) warrants to purchase up to 40,848,711 shares of common stock, for aggregate for gross proceeds of $20.6 million (which includes $2.0 million from related parties).
Removed
The Loans are due and payable on June 1, 2027. The Loan principal is repayable beginning on January 1, 2025, with the possibility of deferring principal payments an additional 6 to 18 months.
Added
Each share and each pre-funded warrant was sold with an accompanying common warrant to purchase one share of common stock. The pre-funded warrants have an exercise price of $0.0001 per share, and the common warrants have an exercise price of $0.3793 per share.
Removed
The Loans bear interest at a rate per annum equal to the greater of (i) the prime rate, as published by the Wall Street Journal from time to time, plus 3.75% and (ii) 12.00%.
Added
Members of the Board of Directors and certain executives of the Company are considered related parties to this offering. The offering closed on December 31, 2024. The Company received net proceeds of $18.9 million after deductions for placement agent commissions and other offering costs of $1.4 million and $0.3 million, respectively.
Removed
A final payment fee of 3.50% of the principal amount of the first two tranches under the Loan Agreement Loans is also due upon repayment of the principal. We are subject to a financial covenant requiring us to maintain $5.0 million in unrestricted cash on deposit in a US bank.
Added
(See Note 4 to our financial statements for the fiscal year ended March 31, 2025). In addition, Beyond Air and Avenue Capital Management II, L.P., Avenue Venture Opportunities Fund, L.P. and Avenue Venture Opportunities Fund II, L.P. (“collectively, Avenue Capital”) reached an agreement to extinguish the Avenue Capital senior secured term loan for a one-time payment of $17.85 million.
Removed
The Loan Agreement also contains affirmative and negative covenants customary for financing of this type. The Loan Agreement also includes events of default customary for financings of this type, in certain cases subject to customary periods to cure, following which the Agent may accelerate all amounts outstanding under the Loans.
Added
This agreement eliminates the debt and interest payments that would have been made to Avenue Capital from October 1, 2024 through June 30, 2026 of $12.0 million. In connection with this agreement $5.0 million was paid on September 27, 2024 in partial settlement.
Added
The Company remeasured the fair value of the derivative liability to $0 at September 30, 2024 as Avenue Capital did not exercise the conversion right related to the loan agreement prior to the extinguishment of the loan agreement and the conversion price exceeded the fair market value of the underlying securities.
Added
The final $12.85 million was paid on October 4, 2024. Avenue Capital invested $3.35 million in the Securities Purchase Agreement II at the same terms and conditions as all other investors. With respect to Beyond Cancer, discussions with investors continue in parallel to the advancement to a phase 1b combination study of UNO with anti-PD1 therapy.
Added
Current cash on hand is expected to be sufficient to complete the phase 1b study. The recent $2.0 million funding for NeuroNOS is still open as fundraising will continue for a period of time not to extend beyond the end of calendar 2025.
Added
Pursuant to the “baby shelf rules” promulgated by the SEC, if our public float is less than $75.0 million as of specified measurement periods, the number of shares of common stock that may be offered and sold by us under a Form S-3 registration statement, including pursuant to the 2025 ATM, in any twelve-month period is limited to an aggregate amount that does not exceed one-third of our public float.
Added
As of March 31, 2025, due to the SEC’s “baby shelf rules,” we were permitted to sell up to $6.6 million of shares of common stock pursuant to the 2025 ATM. We will remain subject to the “baby shelf rules” under the Form S-3 registration statement until such time as our public float exceeds $75.0 million.
Added
Further, there are no assurances that we will be successful in obtaining an adequate level of financing for the development and commercialization of our other product candidates.
Added
(the “2022 ATM”) of $0.7 million and $1.5 million in connection with the 2025 ATM partially offset by $18.0 million from the payment of long- and short-term loans, including a $17.5 million repayment to Avenue Capital.