bioAffinity Technologies, Inc.

We rent additional corporate office space located near the PPLS lease. The rent is currently $2,970 per month, and the term of the lease expires in August 2030.

Management believes that the combination of our rented and licensed office and laboratory spaces are adequate to meet our current needs and expected level of operations. We do not own any real property.

• If our tests do not perform as expected, our operating results, reputation and business will suffer.
• We may experience difficulties that delay or prevent our development, introduction, or marketing of enhanced or new tests.
• If clinical testing of a particular diagnostic test or therapeutic product candidate does not yield successful results, we will be unable to commercialize that test or product candidate.
• Even if our diagnostic tests or therapeutic products receive marketing approval, they may fail to achieve the degree of market acceptance by physicians, patients, third-party payors, and others in the medical community necessary for commercial success.
• If we are unable to establish effective sales, marketing, and distribution capabilities or enter into agreements with third parties with such capabilities, we may not be successful in commercializing our diagnostic tests or therapeutic products if and when they are approved.
• We are currently dependent upon our pathology laboratory PPLS to offer and perform CyPath® Lung.
• If we are unable to convince physicians of the benefits of our proposed diagnostic tests or therapeutic products, we may incur delays or additional expense in our attempt to establish market acceptance.
• We face substantial competition, which may result in others discovering, developing, or commercializing competing diagnostic tests or therapeutic products before or more successfully than we do.
• Our success depends upon our ability to retain key executives and to attract, retain, and motivate qualified personnel, and the loss of these persons could adversely affect our operations and results.
• Our lack of operating experience may make it difficult to manage our growth which could lead to our inability to implement our business plan.
• We will depend on third parties to manufacture our kits, reagents, and supplies, and to support certain commercialization and clinical development activities, including marketing support for our diagnostic tests, the design of clinical trials, the arrangement and oversight of clinical trials, and the collection and analysis of data.
• We are exposed to product liability and pre-clinical and clinical liability risks which could place a substantial financial burden upon us should we be sued.
• Our collection, use, and disclosure of personal information, including health and employee information, is subject to U.S. state and federal privacy and security regulations, and our failure to comply with those regulations or to adequately secure the information we hold could result in significant liability or reputational harm.
• If we are unable to obtain adequate reimbursement from third-party payors or governmental agencies for CyPath® Lung or other diagnostic tests or therapeutic products under development or if new restrictive legislation is adopted, market acceptance of our tests or products may be limited, and we may not achieve expected revenues.
• Our employees, independent contractors, consultants, commercial partners, and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements.
• Our business operations and current and future relationships with investigators, healthcare professionals, consultants, third-party payors, and customers are subject, directly or indirectly, to federal and state healthcare fraud and abuse laws, transparency laws, and other healthcare laws and regulations. If we are unable to comply, or have not fully complied, with such laws, we could face substantial penalties.
• We face intense competition in the biotechnology and pharmaceutical industries.
• The market for our proposed tests and products is competitive and rapidly changing, and new diagnostic technologies which may be developed by others could impair our ability to maintain and grow our business and remain competitive.
• Healthcare cost containment initiatives and the growth of managed care may limit our returns.
• Our internal information technology systems, or those of our third-party clinical research organizations or other contractors or consultants, may fail or suffer security breaches, loss or leakage of data, and other disruptions, which could result in a material disruption of our diagnostic tests’ or therapeutic product candidates’ development programs, compromise sensitive information related to our business, or prevent us from accessing critical information, potentially exposing us to liability or otherwise adversely affecting our business.
• Declining general economic or business conditions, including tariff and customs regulations, may have a negative impact on our business.
• Global climate change and related regulations could negatively affect our business.
• Risks Related to the Operation of a CAP/CLIA Laboratory
• The operations of PPLS will depend in part upon prior relationships with existing customers and our ability to continue such relationships with these customers.
• PPLS may be unable to effectively maintain equipment or generate revenue when its equipment is not operational.
• If our sole laboratory facility becomes damaged or inoperable, loses its accreditation, or is required to vacate the facility, PPLS’ ability to sell its products or provide diagnostic assays and pursue its research and development efforts may be jeopardized.
• PPLS relies on commercial courier delivery services to transport sputum samples for processing the CyPath® Lung test in a timely and cost-efficient manner, and if these delivery services are disrupted, its business will be harmed.
• Security breaches, loss of data, and other disruptions could compromise sensitive information related to PPLS’ business or prevent it from accessing critical information and expose it to liability, which could adversely affect its business and reputation.
• If PPLS uses hazardous chemicals in a manner that causes injury, PPLS could be liable for damages.
• If PPLS is unable to successfully scale its operations to support demand for CyPath® Lung, its business could suffer.
• Billing for PPLS’ services is complex, and PPLS must dedicate substantial time and resources to the billing process to be paid.
• PPLS relies on a third-party billing provider and an in-house billing function to transmit claims to payors, and any delay in transmitting claims could have an adverse effect on its revenue.
• Risks Related to Intellectual Property Rights
• Intellectual property rights do not necessarily address all potential threats to our competitive advantage.
• If we fail to comply with our obligations imposed by any intellectual property licenses with third parties that we may need in the future, we could lose rights that are important to our business.
• In the future, we may need to obtain additional licenses of third-party technology that may not be available to us or are available only on commercially unreasonable terms, which may cause us to operate our business in a more costly or otherwise adverse manner that was not anticipated
• Our competitive position depends on protection of our intellectual property.
• Diagnostic tests and therapeutic products we develop could be subject to infringement claims asserted by others.
• We may become involved in lawsuits to protect or enforce our patents or other intellectual property, which could be expensive, time consuming, and ultimately unsuccessful.
• If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed.
• Changes in patent law in the U.S. and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our diagnostic tests and therapeutic product candidates.
• Obtaining and maintaining patent protection depends on compliance with various procedural, document submissions, fee payment, and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.
• Patent terms may be inadequate to protect our competitive position on our diagnostic tests or therapeutic product candidates for an adequate amount of time.
• Issued patents covering our product candidates could be found invalid or unenforceable if challenged in court or the USPTO.
• If we do not obtain patent term extension in the U.S. under the Hatch-Waxman Act and in foreign countries under similar legislation, thereby potentially extending the term of marketing exclusivity for our diagnostic tests or therapeutic product candidates, our business may be harmed.
• We enjoy only limited geographical protection with respect to certain patents, and we may not be able to protect our intellectual property rights throughout the world.
• If our trademarks and trade names are not adequately protected, we may not be able to build name recognition in our markets of interest, and our business may be adversely affected.
• Risks Related to Government Regulations
• PPLS currently offers CyPath® Lung as an LDT by PPLS. While a federal district court decision concluded FDA does not have jurisdiction to regulate LDTs, FDA could in the future determine that CyPath® Lung is not an LDT, or Congress could enact legislation granting FDA authority to regulate LDTs, which could adversely affect our commercialization strategy and negatively affect our results of operations and financial condition.
• Failure by our laboratory to comply with applicable laws pertaining to LDTs or IVDs could adversely affect our business, results of operations, and financial condition.
• The third-party licensors of our future therapeutic products, when ready, may be unable to obtain regulatory approval. The denial or delay of any such approval would delay commercialization of our future therapeutic products and have a material adverse effect on our potential to generate revenue, our business, and our results of operations.
• Obtaining and maintaining regulatory approval of our diagnostic tests or therapeutic product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our product candidates in other jurisdictions. Failure to obtain regulatory approval in foreign jurisdictions would prevent our product candidates from being marketed abroad.
• Even if we obtain FDA approval of any of our therapeutic product candidates and obtain CMS validation for our diagnostic tests, we may never obtain approval or commercialize such products outside of the United States, which would limit our ability to realize their full market potential.
• The impact of changes to healthcare law and guidance, as well as other changes in the healthcare industry, and changes in healthcare spending are currently unknown and may adversely affect our business model.
• Risks Related to Ownership of Our Common Stock and Warrants
• We are currently listed on The Nasdaq Capital Market (“Nasdaq”). If we are unable to maintain listing of our securities on Nasdaq or any stock exchange, our stock price could be adversely affected and the liquidity of our stock and our ability to obtain financing could be impaired and it may be more difficult for our stockholders to sell their securities.
• We do not expect to pay dividends in the foreseeable future. Any return on investment may be limited to the value of our Common Stock.
• Holders of warrants have no rights as stockholders other than as set forth in the warrants until such holders exercise their warrants and acquire our shares of Common Stock.
• The warrant certificates governing our warrants designate the state and federal courts of the State of New York sitting in the City of New York, Borough of Manhattan, as the exclusive forum for actions and proceedings with respect to all matters arising out of the warrants, which could limit a warrant holder’s ability to choose the judicial forum for disputes arising out of the warrants.
• The financial and operational projections that we may make from time to time are subject to inherent risks.
• Our stock price has fluctuated in the past, has recently been volatile, and may be volatile in the future, and as a result, investors in our Common Stock could incur substantial losses.
• Our Common Stock has often been thinly traded, so investors may be unable to sell at or near ask prices or at all if investors need to sell shares to raise money or otherwise desire to liquidate their shares.
• Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.
• Our Certificate of Incorporation permits “blank check” Preferred Stock, which can be designated by our Board without stockholder approval.
• Provisions in our corporate charter documents and under Delaware law could make an acquisition of the Company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.
• Certain provisions of the DGCL may have anti-takeover effects that could delay, defer, or discourage another party from acquiring control of the Company, prevent changes in our Board or management, and make certain transactions more challenging that stockholders might otherwise believe to be in their best interests.
• Our Charter designates a state or federal court located within the state of Delaware as the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to choose the judicial forum for disputes with us or our directors, officers, or employees.
• If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.