1344413--3/10/2009--Alexza_Pharmaceuticals

related topics

{product, candidate, development}

{product, liability, claim}

{property, intellectual, protect}

{stock, price, operating}

{stock, price, share}

{control, financial, internal}

{condition, economic, financial}

{cost, regulation, environmental}

{acquisition, growth, future}

{personnel, key, retain}

{operation, natural, condition}

We will need substantial additional capital in the future. If additional capital is not available, we will have to delay, reduce or cease operations. Unstable market conditions may have serious adverse consequences on our business. Unless our preclinical studies demonstrate the safety of our product candidates, we will not be able to commercialize our product candidates. Preclinical studies indicated possible adverse impact of pulmonary delivery of AZ-001. Failure or delay in commencing or completing clinical trials for our product candidates could harm our business. Continuing development of our single dose version device may delay regulatory submissions and marketing approval for AZ-004 If our product candidates do not meet safety and efficacy endpoints in clinical trials, they will not receive regulatory approval, and we will be unable to market them. If our product candidates fail to show a clinically significant benefit compared to placebo, they will not be approved for marketing. Regulatory authorities may not approve our product candidates even if they meet safety and efficacy endpoints in clinical trials. Our product candidates will remain subject to ongoing regulatory review even if they receive marketing approval. If we fail to comply with continuing regulations, we could lose these approvals, and the sale of any future products could be suspended. If we do not produce our devices cost effectively, we will never be profitable. We rely on third parties to conduct our preclinical studies and our clinical trials. If these third parties do not perform as contractually required or expected, we may not be able to obtain regulatory approval for our product candidates, or we may be delayed in doing so. Problems with the third parties that manufacture the active pharmaceutical ingredients in our product candidates may delay our clinical trials or subject us to liability. If we experience problems with the manufacturers of components of our product candidates, our development programs may be delayed or we may be subject to liability. If we do not establish additional strategic partnerships, we will have to undertake development and commercialization efforts on our own, which would be costly and delay our ability to commercialize any future products. If we enter into additional strategic partnerships, we may be required to relinquish important rights to and control over the development of our product candidates or otherwise be subject to terms unfavorable to us. If we fail to gain market acceptance among physicians, patients, third-party payors and the medical community, we will not become profitable. Our pipeline may be limited by the number of drug compounds suitable for use with the Staccato system. AZ-001 and other product candidates that we may develop may require expensive carcinogenicity tests. If some or all of our patents expire, are invalidated or are unenforceable, or if some or all of our patent applications do not yield issued patents or yield patents with narrow claims, competitors may develop competing products using our or similar intellectual property and our business will suffer. Even if valid and enforceable patents cover our product candidates and technologies, the patents will provide protection only for a limited amount of time. Litigation or other proceedings or third party claims of intellectual property infringement could require us to spend time and money and could shut down some of our operations. Competition in the pharmaceutical industry is intense. If our competitors are able to develop and market products that are more effective, safer or less costly than any future products that we may develop, our commercial opportunity will be reduced or eliminated. If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell our product candidates, we may be unable to generate significant product revenue. If we lose our key personnel or are unable to attract and retain additional personnel, we may be unable to develop or commercialize our product candidates. If plaintiffs bring product liability lawsuits against us, we may incur substantial liabilities and may be required to limit commercialization of the product candidates that we may develop. Our product candidates AZ-002, AZ-003 and AZ-007 contain drug substances which are regulated by the U.S. Drug Enforcement Administration. Failure to comply with applicable regulations could harm our business. The single dose version of our Staccato system contains materials that are regulated by the U.S. government, and failure to comply with applicable regulations could harm our business. We use hazardous chemicals and highly combustible materials in our business. Any claims relating to improper handling, storage or disposal of these materials could be time consuming and costly. We will need to implement additional finance and accounting systems, procedures and controls in the future as we grow and to satisfy new reporting requirements. Our facilities are located near known earthquake fault zones, and the occurrence of an earthquake or other catastrophic disaster could damage our facilities and equipment, which could cause us to curtail or cease operations. Risks Relating to Owning Our Common Stock Our stock price has been and may continue to be extremely volatile. If we sell shares of our common stock under our equity line of credit or in other future financings, existing common stock holders will experience immediate dilution and, as a result, our stock price may go down.

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1344413--3/10/2009--Alexza_Pharmaceuticals_Inc.