plan to adopt policies and procedures designed to comply with applicable laws and regulations. Developing a compliance infrastructure
is costly and time-consuming, and even a well-designed and implemented compliance program cannot necessarily prevent all violations
of relevant laws. We may be subject to enforcement action based on the actions or omissions of employees or contractors, including
our anticipated sales force.
commercial success of DetermaVuTM depends on the availability and sufficiency of third-party payer coverage
and reimbursement, which may be limited or unavailable.
ability to successfully commercialize DetermaVuTM will depend, in significant part, on the extent to which appropriate
reimbursement levels can be obtained for patients. Physicians will be hesitant to order a diagnostic test for a patient where
they may be left with a large out-of-pocket fee through co-payments or co-insurance or unreimbursed balances. Third-party
payers, including Medicare, Medicaid and private insurers, are increasingly challenging the prices charged for healthcare
products and services. In addition, legislative proposals to reform health care or reduce government insurance programs may result
in lower prices or the actual inability of prospective customers to purchase DetermaVuTM. Furthermore, even if reimbursement
is available, it may not be available at price levels sufficient for us to realize a positive return on our investment. We
have never successfully obtained reimbursement for any test and may never be able to obtain reimbursement from any third-party
payer; without such coverage and reimbursement, we may not achieve market acceptance of our test and may never be profitable.
United States government and state legislatures have shown significant interest in implementing cost containment programs to limit
the growth of government-paid healthcare costs, including price controls, restrictions on reimbursement and coverage. Adoption
of government controls and measures, and tightening of restrictive policies in jurisdictions with existing controls and measures,
could exclude or limit DetermaVuTM from coverage. Even if DetermaVuTM receives coverage and reimbursement
from third-party payers, such coverage policies and reimbursement rates may change at any time, might not be adequate,
or less favorable coverage polices and reimbursement rates may be implemented in the future. If we are unable to obtain and maintain
sufficient third-party coverage and adequate reimbursement for DetermaVuTM, its commercial success may be greatly hindered
and our financial condition and results of operations may be materially and adversely affected.
may need to conduct additional studies in order to demonstrate the cost-effectiveness of DetermaVuTM to the satisfaction
of our target customers and their third-party payers. Such studies might require us to commit a significant amount of management
time and financial and other resources.
Related to our Intellectual Property
rely on patents and trade secrets, and our financial success will be dependent, in part, on our ability to obtain commercially
valuable patent claims, protect our intellectual property rights and operate without infringing upon the proprietary rights of
rely primarily on patents and contractual obligations with employees and third parties to protect our proprietary rights. We have
sought, and intend to continue to seek, appropriate patent protection for important and strategic components of our proprietary
technologies by filing patent applications in the United States and certain foreign countries. We may also use license agreements
both to access technologies developed by other companies and universities and to convey certain intellectual property rights to
others. Our financial success will be dependent, in part, on our ability to obtain commercially valuable patent claims, protect
our intellectual property rights and operate without infringing upon the proprietary rights of others.
regard to our DetermaVu™, we exclusively license from Wistar two patent families with claims directed to compositions of
matter and methods useful for detection of lung cancer using specific biomarkers or a panel of specific biomarkers. The first
patent family has patent applications pending in the United States and certain foreign jurisdictions, including Australia, Canada,
China, India, and Japan, where, if issued, such patents would expire in 2036. The second patent family has patent applications
pending in the United States and certain foreign jurisdictions, including Australia, Canada, China, India, and Japan, where, if
issued, such patents would expire in 2037.
addition to relying on patents, we rely on trade secrets, know-how, and continuing technological advancement to maintain our competitive
position. We have entered into intellectual property, invention, and non-disclosure agreements with our employees, and it is our
practice to enter into confidentiality agreements with our consultants. These measures may not prevent the unauthorized disclosure
or use of our trade secrets and know-how, and others may independently develop similar trade secrets and know-how or obtain access
to our trade secrets, know-how, or proprietary technology.