Can-Fite(CANF) - 2025 Q4 - Annual Report

Financial Performance - The company has incurred net losses of approximately $9.8 million in 2025, $7.9 million in 2024, and $7.6 million in 2023, with an accumulated deficit of approximately $176.2 million as of December 31, 2025[38]. - The company expects to continue incurring substantial operating losses for the foreseeable future due to ongoing research and development activities[38]. - The company may incur substantial costs in pursuing future capital financing, which could adversely impact its financial condition[44]. - The company has cash and cash equivalents of $5.5 million and short-term deposits of $3.0 million as of December 31, 2025, which are expected to be sufficient for the next twelve months[40]. - The company may face significant additional expenses due to ongoing regulatory obligations and reviews even after obtaining marketing approval for product candidates[135]. Product Development and Regulatory Risks - The company has not yet commercialized any products or technologies and may never achieve profitability[47]. - The product candidates are at various stages of clinical and preclinical development, with none receiving regulatory approval for commercial sale[49]. - The company faces risks related to the failure of product candidates to receive regulatory approvals, which could adversely affect its business and financial condition[50]. - Clinical trials are expensive and time-consuming, with potential delays caused by unforeseen safety issues, regulatory non-acceptance, and manufacturing challenges[60]. - Previous clinical trials for Piclidenoson have not met primary efficacy endpoints, including studies for dry-eye syndrome and glaucoma, which raises concerns about future product development[61]. - The success of the company's product candidates depends on regulatory approvals, which are uncertain and subject to various risks[124]. - Delays or limitations in regulatory approvals could materially affect the company's ability to market its products, impacting financial performance[123]. Market and Competitive Environment - Intense competition exists in the biotechnology and biopharmaceutical industry, with competitors having greater financial resources and research capabilities[75]. - Major competitors in the therapeutic fields include Amgen, J&J, Pfizer, and others, indicating a highly competitive landscape[80]. - Competitors may develop and commercialize products faster, potentially reducing the company's market opportunities[76]. - Factors influencing market acceptance include clinical safety and efficacy, pricing, and the effectiveness of sales and marketing strategies[134]. Management and Operational Risks - The company is dependent on key members of management and consultants, and failure to retain them could have a material adverse effect on its business[33]. - The company is currently dependent on three molecules, Piclidenoson, Namodenoson, and CF602, for potential commercial success, with any safety or efficacy concerns significantly impacting business operations[59]. - The company lacks sales, marketing, and distribution capabilities, which could adversely affect its ability to market product candidates effectively[69]. - The company relies on third parties for manufacturing and supply strategies, and any failure in these areas could adversely affect business operations and financial condition[71]. Legal and Compliance Risks - The company may face significant expenses and liabilities due to litigation or other proceedings related to patents and intellectual property rights, which could adversely affect its financial condition[106]. - Regulatory compliance is critical, as failure to meet ongoing requirements could result in loss of marketing approvals and negatively impact sales[85]. - The company is subject to various regulatory approvals, which can be time-consuming and expensive, potentially diverting management resources[122]. - The company is subject to significant penalties for non-compliance with healthcare laws, including fines up to €20,000,000 or up to 4% of total worldwide annual turnover for GDPR violations[175]. Economic and Geopolitical Risks - The company faces risks from political, economic, and military instability in Israel, which may adversely affect business conditions and financial results[176]. - Continued military escalation in the region may disrupt markets and create uncertainty that could negatively impact the company's business and financial condition[179]. - Economic conditions, including geopolitical events, may adversely affect the company's business and financial results[192]. - The Israeli government currently covers the reinstatement value of direct damages caused by terrorist attacks or acts of war, but this coverage may not be guaranteed in the future[181]. Shareholder and Corporate Governance - The company has not declared or paid any cash dividends on its ordinary shares and does not anticipate doing so in the foreseeable future[205]. - The company may be classified as a Passive Foreign Investment Company (PFIC), which could have negative tax implications for U.S. shareholders[195]. - Shareholder rights are governed by Israeli law, which may differ from U.S. corporate governance practices[186]. - The company is permitted to follow home country corporate governance practices, which may provide less protection to investors compared to U.S. domestic issuers[217].