Investing in our Common Shares involves a high degree of risk. Before making an investment decision, you should carefully consider the risks described below
and under "Risk Factors" in any applicable prospectus supplement and in our most recent Annual Report on Form 10-K, or any updates in our Quarterly Reports on Form 10-Q,
together with all of the other information appearing in or incorporated by reference into this prospectus and any applicable prospectus supplement, before deciding whether to purchase any of
the Common Shares being offered. Our business, financial condition or results of operations could be materially adversely affected by any of these risks. The trading price of our Common
Shares could decline due to any of these risks, and you may lose all or part of your investment.
Seelos is a clinical-stage company, has a very limited operating history, is not currently profitable, does not expect to become profitable in the near future
and may never become profitable.
Seelos is a clinical-stage biopharmaceutical company. Since Seelos' incorporation, it has focused primarily on the development and acquisition of clinical-stage
therapeutic candidates. All of Seelos' therapeutic candidates are in the clinical development stage and none of Seelos' therapeutic candidates has been approved for marketing or are being
marketed or commercialized.
As a result, Seelos has no meaningful historical operations upon which to evaluate Seelos' business and prospects and has not yet demonstrated an ability to obtain
marketing approval for any of its product candidates or successfully overcome the risks and uncertainties frequently encountered by companies in the biopharmaceutical industry. Seelos also
has not generated any revenues from collaboration and licensing agreements or product sales to date, and continues to incur significant research and development and other expenses. As a
result, Seelos has not been profitable and has incurred significant operating losses in every reporting period since its inception. For the year ended December 31, 2017, Seelos reported a net
loss of $1.1 million and had an accumulated deficit of $1.3 million as of December 31, 2017.
For the foreseeable future, Seelos expects to continue to incur losses, which will increase significantly from historical levels as Seelos expands its drug development
activities, seeks partnering regulatory approvals for its product candidates and begins to commercialize them if they are approved by the U.S. Food and Drug Administration (the
"FDA") the European Medicines Agency (the "EMA") or comparable foreign authorities. Even if Seelos succeeds in developing and commercializing one or more product
candidates, Seelos may never become profitable.
Seelos is dependent on the success of one or more of Seelos' current product candidates and Seelos cannot be certain that any of them will receive
regulatory approval or be commercialized.
Seelos has spent significant time, money and effort on the licensing and development of its core assets, SLS-002 and SLS-006 and its earlier-stage assets,
SLS-008, SLS-010 and SLS-012. To date, no pivotal clinical trials designed to provide clinically and statistically significant proof of efficacy, or to provide sufficient evidence of safety to justify
approval, have been completed with any of Seelos' product candidates. All of Seelos' product candidates will require additional development, including clinical trials as well as further preclinical
studies to evaluate their toxicology, carcinogenicity and pharmacokinetics and optimize their formulation, and regulatory clearances before they can be commercialized. Positive results
obtained during early development do not necessarily mean later development will succeed or that regulatory clearances will be obtained. Seelos' drug development efforts may not lead to
commercial drugs, either because Seelos' product candidates fail to be safe and effective or because Seelos has inadequate financial or other resources to advance Seelos' product candidates
through the clinical development and approval processes. If any of Seelos' product candidates fail to demonstrate safety or efficacy at any time or during any phase of development, Seelos
would experience potentially significant delays in, or be required to abandon, development of the product candidate.
Seelos does not anticipate that any of its current product candidates will be eligible to receive regulatory approval from the FDA, the EMA or comparable foreign
authorities and begin commercialization for a number of years, if ever. Even if Seelos ultimately receives regulatory approval for any of these product candidates, Seelos or its potential future
partners, if any, may be unable to commercialize them successfully for a variety of reasons. These include, for example, the availability of alternative treatments, lack of cost-effectiveness, the
cost of manufacturing the product on a commercial scale and competition with other drugs. The success of Seelos' product candidates may also be limited by the prevalence and severity of
any adverse side effects. If Seelos fails to commercialize one or more of its current product candidates, Seelos may be unable to generate sufficient revenues to attain or maintain profitability,
and Seelos' financial condition and stock price may decline.
If development of Seelos' product candidates does not produce favorable results, Seelos and its collaborators, if any, may be unable to commercialize
To receive regulatory approval for the commercialization of Seelos' core assets, SLS-002 and SLS-006 and its earlier-stage assets, SLS-008, SLS-010 and
SLS-012, or any other product candidates that Seelos may develop, adequate and well-controlled clinical trials must be conducted to demonstrate safety and efficacy in humans to the
satisfaction of the FDA, the EMA and comparable foreign authorities. In order to support marketing approval, these agencies typically require successful results in one or