Raising additional funds through
debt or equity financing could be dilutive and may cause the market price of our Common Stock to decline.
Until such time, if
ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity offerings
and debt financings, and potentially through strategic partnerships with third parties. To the extent that additional capital is
raised through the sale of equity or convertible debt securities, the issuance of those securities could result in substantial
dilution for our current stockholders and the terms may include liquidation or other preferences that adversely affect the rights
of our current stockholders. Furthermore, the issuance of additional securities, whether equity or debt, by us, or the possibility
of such issuance, may cause the market price of our Common Stock to decline and existing stockholders may not agree with our financing
plans or the terms of such financings. Moreover, the incurrence of debt financing could result in a substantial portion of our
operating cash flow being dedicated to the payment of principal and interest on such indebtedness and could impose restrictions
on our operations, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or
license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business.
Additional funding may not be available to us on acceptable terms, or at all.
If securities analysts do not publish
research or reports about our business or if they downgrade our stock, the price of our Common Stock could decline.
The trading market
for our Common Stock will rely in part on the research and reports that industry or financial analysts publish about us, our business,
our markets and our competitors. We do not control these analysts. If securities analysts do not cover our Common Stock, the lack
of research coverage may adversely affect the market price of our Common Stock. Furthermore, if one or more of the analysts who
do cover us downgrade our stock or if those analysts issue other unfavorable commentary about us or our business, our stock price
would likely decline. If one or more of these analysts cease coverage of us or fails to regularly publish reports on us, we could
lose visibility in the market and interest in our stock could decrease, which in turn could cause our stock price or trading volume
to decline and may also impair our ability to expand our business with existing customers and attract new customers.
The concentration of our capital
stock ownership with insiders will likely limit your ability to influence corporate matters.
As of September 30,
2017, our executive officers, directors, current 5% or greater stockholders, and their respective affiliates together beneficially
own or control, in aggregate, more than 50% of the shares of our outstanding Common Stock. As a result, these executive officers,
directors and principal stockholders, acting together, will have substantial influence over most matters that require approval
by our stockholders, including the election of directors, any merger, consolidation or sale of all or substantially all or of our
assets or any other significant corporate transaction. Corporate action might be taken even if other stockholders oppose such action.
These stockholders may delay or prevent a change of control or otherwise discourage a potential acquirer from attempting to obtain
control of our company, even if such change of control would benefit our other stockholders. This concentration of stock ownership
may adversely affect investors’ perception of our corporate governance or delay, prevent or cause a change in control of
our company, any of which could adversely affect the market price of our Common Stock.
Future sales and issuances of our
Common Stock or rights to purchase Common Stock, including pursuant to our equity incentive plans, could result in additional dilution
of the percentage ownership of our stockholders and could cause our stock price to fall.
We have filed a registration
statement permitting shares of Common Stock issued in the future, pursuant to our employee benefit plans, to be freely resold by
plan participants in the public market, subject to applicable lock-up agreements, applicable vesting schedules and, for shares
held by directors, executive officers and other affiliates, volume limitations under Rule 144 for shares. Our 2014 Employee Incentive
Plan and 2014 Employee Stock Purchase Plan also contain a provision for the annual increase of the number of shares reserved for
issuance under such plan, which shares we also intend to register in the future as such annual increase occurs. If the shares we
may issue from time to time under our employee benefit plans are sold, or if it is perceived that they will be sold, by the award
recipient in the public market, the trading price of our Common Stock could decline.
We expect that significant
additional capital will be needed in the future to continue our planned operations, including conducting clinical trials, commercialization
efforts, expanded research and development activities and costs associated with operating a public company. To raise capital, we
may sell Common Stock, convertible securities or other equity securities in one or more transactions at prices and in a manner
we determine from time to time. If we sell Common Stock, convertible securities or other equity securities in more than one transaction,
investors may be materially diluted by subsequent sales. Such sales may also result in material dilution to our existing stockholders,
and new investors could gain rights, preferences and privileges senior to the holders of our Common Stock.