provisions during the patent application process. In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. However, there are
situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. If this
occurs with respect to Seelos' in-licensed patents or patent applications Seelos may file in the future, Seelos' competitors might be able to use its technologies, which would have a material
adverse effect on Seelos' business, financial condition and results of operations.
The patent positions of pharmaceutical products are often complex and uncertain. The breadth of claims allowed in pharmaceutical patents in the U.S. and many
jurisdictions outside of the U.S. is not consistent. For example, in many jurisdictions, the support standards for pharmaceutical patents are becoming increasingly strict. Some countries prohibit
method of treatment claims in patents. Changes in either the patent laws or interpretations of patent laws in the U.S. and other countries may diminish the value of Seelos' licensed or owned
intellectual property or create uncertainty. In addition, publication of information related to Seelos' current product candidates and potential products may prevent Seelos from obtaining or
enforcing patents relating to these product candidates and potential products, including without limitation composition-of-matter patents, which are generally believed to offer the strongest
Patents that Seelos currently licenses and patents that Seelos may own or license in the future do not necessarily ensure the protection of Seelos' licensed or owned
intellectual property for a number of reasons, including, without limitation, the following:
- the patents may not be broad or strong enough to prevent competition from other products that are identical or similar to Seelos' product candidates;
- there can be no assurance that the term of a patent can be extended under the provisions of patent term extensions afforded by U.S. law or similar provisions in
foreign countries, where available;
- the issued patents and patents that Seelos may obtain or license in the future may not prevent generic entry into the market for Seelos' product
- Seelos, or third parties from whom Seelos in-license or may license patents, may be required to disclaim part of the term of one or more patents;
- there may be prior art of which Seelos is not aware that may affect the validity or enforceability of a patent claim;
- there may be prior art of which Seelos is aware, which Seelos does not believe affects the validity or enforceability of a patent claim, but which, nonetheless,
ultimately may be found to affect the validity or enforceability of a patent claim;
- there may be other patents issued to others that will affect Seelos' freedom to operate;
- if the patents are challenged, a court could determine that they are invalid or unenforceable;
- there might be a significant change in the law that governs patentability, validity and infringement of Seelos' licensed patents or any future patents Seelos may own
that adversely affects the scope of Seelos' patent rights;
- a court could determine that a competitor's technology or product does not infringe Seelos' licensed patents or any future patents Seelos may own; and
- the patents could irretrievably lapse due to failure to pay fees or otherwise comply with regulations or could be subject to compulsory licensing.
If Seelos encounters delays in Seelos' development or clinical trials, the period of time during which Seelos could market its potential products under patent protection
would be reduced.
Seelos' competitors may be able to circumvent its licensed patents or future patents Seelos may own by developing similar or alternative technologies or products in a
non-infringing manner. Seelos' competitors may seek to market generic versions of any approved products by submitting abbreviated new drug applications to the FDA in which Seelos'
competitors claim that Seelos' licensed patents or any future patents Seelos may own are invalid, unenforceable or not infringed. Alternatively, Seelos' competitors may seek approval to market
their own products similar to or otherwise competitive with Seelos' products. In these circumstances, Seelos may need to defend or assert Seelos' licensed patents or any future patents Seelos
may own, including by filing lawsuits alleging patent infringement. In any of these types of proceedings, a court or other agency with jurisdiction may find Seelos' licensed patents or any future
patents Seelos may own invalid or unenforceable. Seelos may also fail to identify patentable aspects of its research and development before it is too late to obtain patent protection. Even if
Seelos owns or in-licenses valid and enforceable patents, these patents still may not provide protection against competing products or processes sufficient to achieve Seelos' business
The issuance of a patent is not conclusive as to its inventorship, scope, ownership, priority, validity or enforceability. In this regard, third parties may challenge Seelos'
licensed patents or any future patents Seelos may own in the courts or patent offices in the U.S. and abroad. Such challenges may result in loss of exclusivity or freedom to operate or in patent
claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit Seelos' ability to stop others from using or commercializing