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the FDA or foreign agency may not agree with our or our partners regulatory approval strategies or components of the regulatory filings, such as clinical trial designs.
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For example, if certain of our or our partners methods for analyzing trial data are not accepted by the FDA or the applicable foreign
agency, we or our partners may fail to obtain regulatory approval for our products.
Any delay or failure to obtain regulatory approvals
for our products will result in increased costs, could diminish competitive advantages that we may attain and would adversely affect the marketing and sale of our products. Other than HETLIOZ
®
in the U.S. and Fanapt
®
in the U.S., Mexico and Israel, we have not received regulatory approval to market any of our products in any jurisdiction.
Even following regulatory approval of our products, the FDA or the applicable foreign agency may impose limitations on the indicated uses for
which such products may be marketed, subsequently withdraw approval or take other actions against us, our partners or such products that are adverse to our business. The FDA and foreign agencies generally approve drugs for particular indications. An
approval for a more limited indication reduces the size of the potential market for the product. Product approvals, once granted, may be withdrawn or modified if problems occur after initial marketing.
We and our partners also are subject to numerous federal, state, local and foreign laws, regulations and recommendations relating to safe
working conditions, laboratory and manufacturing practices, the environment and the use and disposal of hazardous substances used in connection with discovery, research and development work. In addition, we cannot predict the extent to which new
governmental regulations might significantly impede the discovery, development, production and marketing of our products. We or our partners may be required to incur significant costs to comply with current or future laws or regulations, and we may
be adversely affected by the cost of such compliance or the inability to comply with such laws or regulations.
If our products are determined to be
unsafe or ineffective in humans, whether commercially or in clinical trials, our business will be materially harmed.
Despite the
FDAs approval of the NDA for HETLIOZ
®
in January 2014 and the NDA for Fanapt
®
in May 2009, and the positive results of our
completed trials for HETLIOZ
®
and Fanapt
®
, we are uncertain whether either of these products will ultimately prove to be effective and
safe in humans. Frequently, products that have shown promising results in clinical trials have suffered significant setbacks in later clinical trials or even after they are approved for commercial sale. Future uses of our products, whether in
clinical trials or commercially, may reveal that the product is ineffective, unacceptably toxic, has other undesirable side effects, is difficult to manufacture on a large scale, is uneconomical, infringes on proprietary rights of another party or
is otherwise not fit for further use. If our products are determined to be unsafe or ineffective in humans, our business will be materially harmed.
Clinical trials for our products are expensive and their outcomes are uncertain. Any failure or delay in completing clinical trials for our products
could severely harm our business.
Pre-clinical studies and clinical trials required to demonstrate the safety and efficacy of our
products are time-consuming and expensive and together take several years to complete. Before obtaining regulatory approvals for the commercial sale of any of our products, we or our partners must demonstrate through preclinical testing and clinical
trials that such product is safe and effective for use in humans. We have incurred, and we will continue to incur, substantial expense for, and devote a significant amount of time to, preclinical testing and clinical trials.
Historically, the results from preclinical testing and early clinical trials often have not predicted results of later clinical trials. A
number of new drugs have shown promising results in clinical trials, but subsequently failed to establish sufficient safety and efficacy data to obtain necessary regulatory approvals. Clinical trials
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