ACHIEVE LIFE SCIENCES, INC.

On November 9, 2023, we entered into a lease agreement for our office space in Bothell, Washington, which commenced on March 1, 2024, and had a one-year term. On May 10, 2025, we entered into an agreement to extend the lease for another six-month term, which commenced on September 1, 2025. The annualized rent is approximately $17,000.

We believe that the facilities we currently lease are sufficient for our anticipated near-term needs.

• Clinical trials are costly, time consuming and inherently risky, and we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities. Any advances of cytisinicline into clinical trials may not have favorable results or receive regulatory approval.
• Cytisinicline may cause undesirable side effects or have other properties that could delay or prevent regulatory approval, limit the commercial viability of an approved label, or result in significant negative consequences following marketing approval, if any.
• Our product development program may not uncover all possible adverse events that patients who take cytisinicline or our other product candidates may experience. The number of subjects exposed to cytisinicline or our other product candidates and the average exposure time in the clinical development program may be inadequate to detect rare adverse events, or chance findings, that may only be detected once the product is administered to more patients and for greater periods of time.
• If the use or misuse of cytisinicline harms patients, or is perceived to harm patients even when such harm is unrelated to cytisinicline, our regulatory approvals, if any, could be revoked or otherwise negatively impacted and we could be subject to costly and damaging product liability claims. If we are unable to obtain adequate insurance or are required to pay for liabilities resulting from a claim excluded from, or beyond the limits of, our insurance coverage, a material liability claim could adversely affect our financial condition.
• Our business may be negatively affected by weather conditions, natural disasters, and the availability of natural resources, as well as by climate change.
• We may use our financial and human resources to pursue a particular research program or product candidate and fail to capitalize on programs or product candidates that may be more profitable or for which there is a greater likelihood of success.
• Risks Related to Regulatory Approval of Cytisinicline and Other Legal Compliance Matters
• If we do not obtain the necessary regulatory approvals in the United States and/or other countries, we will not be able to sell cytisinicline.
• Disruptions at the FDA may slow the time necessary for new products to be reviewed and/or approved, which would adversely affect our business. In addition, there is substantial uncertainty regarding new initiatives and how these might impact the FDA, its implementation of laws, regulations, policies and guidance and its personnel. Similar initiatives may also be directed toward other government agencies. These initiatives could prevent, limit or delay development and regulatory approval of our product candidates, which would adversely affect our business.
• Healthcare legislative and executive reform measures may have a material adverse effect on our business, financial condition or results of operations.
• Our ability to obtain services, reimbursement or funding may be impacted by possible reductions in federal spending in the United States as well as globally.
• Even if we obtain regulatory approval for cytisinicline, we will remain subject to ongoing regulatory requirements in connection with the sale and distribution of cytisinicline.
• Ongoing post-approval monitoring and clinical trial obligations may be costly to us and the failure to meet such obligations may result in the withdrawal of such approvals.
• We may be subject, directly or indirectly, to federal and state healthcare fraud and abuse laws, false claims laws, and health information privacy and security laws. If we are unable to comply, or have not fully complied, with such laws, we could face substantial penalties.
• Our employees, independent contractors, consultants, commercial partners, principal investigators, or CROs may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business.
• A Breakthrough Therapy designation by the FDA and our receipt of a CNPV may not lead to a faster development or regulatory review or approval process for the nicotine e-cigarette/vaping cessation indication and it does not increase the likelihood that our product candidates will receive marketing approval.
• Risks Related to our Business Operations
• It is difficult to evaluate our current business, predict our prospects and forecast our financial performance and growth.
• Our future success depends in part on our ability to attract, retain, and motivate other qualified personnel.
• We will need to expand our organization and we may experience difficulties in managing this growth, which could disrupt our operations.
• We plan to invest in the development of additional indications for cytisinicline. If we invest in and are unsuccessful in developing additional indications for cytisinicline, our business, financial condition and results of operations may be adversely affected.
• Our internal computer systems, or those of our third-party collaborators or other service providers, may fail or suffer security breaches and cyber-attacks, which could result in a material disruption of our development programs.
• Risks Related to Our Reliance on Third Parties
• We expect to continue to rely on third parties to manufacture cytisinicline. Our commercialization of cytisinicline could be stopped, delayed or made less profitable if we and Sopharma are not able to come to a resolution to our dispute, or if Sopharma or our other manufacturing partners fail to obtain approval of government regulators, fail to provide us with sufficient quantities of product or fail to do so at acceptable quality levels or prices.
• We rely on third parties to conduct our clinical trials and perform other services. If these third parties do not successfully perform and comply with regulatory requirements, we may not be able to successfully complete clinical development, obtain regulatory approval or commercialize cytisinicline and our business could be substantially harmed.
• We may not be able to establish or maintain the third-party relationships that are necessary to develop or potentially commercialize cytisinicline.
• We may be unable to realize the potential benefits of any collaborations which we may enter into with other companies for the development and commercialization of cytisinicline.
• We enter into various contracts in the normal course of our business in which we indemnify the other party to the contract. In the event we have to perform under these indemnification provisions, it could have a material adverse effect on our business, financial condition and results of operations.
• We may rely on third parties to perform many essential services for any of our current or future product candidates that we commercialize, including services related to warehousing and inventory control, distribution, government price reporting, customer service, accounts receivable management, cash collection, and adverse event reporting. If these third parties fail to perform as expected or to comply with legal and regulatory requirements, our ability to commercialize any of our current or future product candidates will be significantly impacted and we may be subject to regulatory sanctions.
• Risks Related to Commercialization of Cytisinicline
• If we are unable to establish distribution, marketing, and sales capabilities, we may not be successful in commercializing cytisinicline, if approved.
• We face substantial competition, and our competitors may discover, develop or commercialize products faster or more successfully than us.
• The commercial success of cytisinicline will depend upon the degree of market acceptance by physicians, patients, third-party payors, and others in the medical community. Failure to obtain or maintain adequate reimbursement or insurance coverage for products, if any, could limit our ability to market cytisinicline and decrease our ability to generate revenue.
• Sopharma may breach its supply agreement with us and sell cytisinicline into our territories or permit third parties to export cytisinicline into our territories and negatively affect our commercialization efforts of our products in our territories.
• The illegal distribution and sale by third parties of counterfeit versions of cytisinicline, stolen products, or alternative third-party distribution and sale of cytisinicline could have a negative impact on our financial performance or reputation.
• We may attempt to form collaborations in the future with respect to cytisinicline, but we may not be able to do so, which may cause us to alter our development and commercialization plans.
• We may not be successful in any efforts to identify, license, discover, develop, or commercialize additional product candidates.
• We are subject to U.S. and certain foreign export and import controls, sanctions, embargoes, anti-corruption laws, and anti-money laundering laws and regulations. Compliance with these legal standards could impair our ability to compete in domestic and international markets. We can face criminal liability and other serious consequences for violations that can harm our business.
• Risks Related to our Intellectual Property
• If we are unable to maintain effective proprietary rights for our product candidate or any future product candidates, we may not be able to compete effectively in our proposed markets.
• Third-party claims of intellectual property infringement may prevent or delay our development and commercialization efforts.
• We intend to rely on patent rights for certain aspects of our product candidates and certain future product candidates. If we are unable to obtain or maintain an adequate proprietary position from this approach, we may not be able to compete effectively in our markets.
• Changes in patent law could diminish the value of patents in general, thereby impairing our ability to protect our product candidates.
• We may be subject to claims that our employees, consultants, or independent contractors have wrongfully used or disclosed confidential information of third parties or that our employees have wrongfully used or disclosed alleged trade secrets of their former employers.
• It is difficult and costly to protect our proprietary rights and as a result we may not be able to ensure their protection. In addition, patents have a limited lifespan and will eventually expire.
• Obtaining and maintaining our patent protection depends on compliance with various procedural, documentary, fee payment, and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for noncompliance with these requirements.
• We may be involved in lawsuits to protect or enforce our patents or the patents of our licensors, which could be expensive, time consuming, and unsuccessful.
• We or our licensors may not be able to protect our intellectual property rights throughout the world.
• Risks Related to Our Common Stock
• The price for our common stock is volatile.
• A significant portion of our total outstanding shares of common stock may be sold into the public market at any point, which could cause the market price of our common stock to drop significantly, even if our business is doing well, and result in significant dilution to our stockholders.
• If we raise additional capital, the terms of the financing transactions may cause dilution to existing stockholders or contain terms that are not favorable to us.
• We are a smaller reporting company and we cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies will make our common stock less attractive to investors.
• If equity research analysts do not publish research or reports, or publish unfavorable research or reports, about us, our business, or our market, our stock price and trading volume could decline.
• General Risk Factors
• We are at risk of securities class action litigation.
• We incur costs and demands upon management as a result of complying with the laws and regulations affecting public companies.
• Shareholder activists could cause a disruption to our business.
• Anti-takeover provisions under Delaware law could make an acquisition of us more difficult and may prevent attempts by our stockholders to replace or remove our management.
• Our bylaws provide that the Court of Chancery of the State of Delaware is 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 other employees.
• Failure to maintain effective internal control over financial reporting could have a material adverse effect on our reputation, results of operations and financial condition.
• Because our merger resulted in an ownership change under Section 382 of the U.S. Internal Revenue Code for OncoGenex, pre-merger net operating loss carryforwards and certain other tax attributes are now subject to limitations.
• U.S. federal tax reform and changes in other tax laws could increase our tax burden and adversely affect our business and financial condition.