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Anebulo Pharmaceuticals (ANEB) Risk Analysis
Risk Overview Q4, 2025
Risk Change Over Time
- Share Price & Shareholder Rights - Risk 1We are in the process of going private, which includes delisting our Common Stock from the Nasdaq Stock Market and deregistering our Common Stock under the Exchange Act.
As previously disclosed, on January 29, 2026, we announced the final results of the Offer, pursuant to which we accepted for payment an aggregate of 300,000 shares, including 134,306 "odd lots," of Common Stock at a purchase price of $3.50 per share, for an aggregate cost of approximately $1.05 million, excluding fees and expenses relating to the Offer. In accordance with our plan to "go private" following the completion of the Offer, on February 6, 2026, we notified Nasdaq of our intent to voluntarily delist the Common Stock from the Nasdaq and publicly announced such intent. We also announced our planned subsequent voluntary deregistration of the Common Stock with the SEC in order to terminate and suspend our reporting obligations under the Securities Exchange Act of 1934, as amended. We currently intend to file a Form 25 with the SEC to delist our Common Stock from Nasdaq on or about February 27, 2026. We expect the delisting of our Common Stock will be effective 10 days after we file the Form 25 with the SEC, and the deregistration of our Common Stock under Section 12(b) of the Exchange Act will take effect 90 days after the filing of the Form 25. We will also be required to terminate our registration under other applicable provisions of the Exchange Act by filing a Form 15. Anebulo intends to file a Form 15 with the SEC on or about February 27, 2026. When we file the Form 15 with the SEC, we must certify to the SEC that we have less than 300 stockholders. Upon filing the Form 15, Anebulo's obligation to file periodic reports with the SEC will be immediately suspended. During the ten-day period between the filing of the Form 25 and the Form 15, the number of holders of record can change due to broker "kick-outs", ordinary trading or intentional actions of stockholders. As a result of these changes in stock ownership, at the end of the ten-day period, it is possible that the number of our record holders could exceed 300, and we would be unable to file the Form 15 and complete the deregistration process. If this were to occur, we would have already delisted from Nasdaq and therefore would continue trade on the OTC. Following deregistration, we will no longer file annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. Accordingly, there will be significantly less information regarding our company available to stockholders and potential investors. In addition, we will no longer be subject to the provisions of the Sarbanes-Oxley Act and certain of the liability provisions of the Exchange Act, although we will still be subject to the antifraud provisions of the Exchange Act and any applicable state securities laws. Following deregistration, our executive officers, directors and 10% stockholders will no longer be required to file reports relating to their transactions in our common stock with the SEC. In addition, our executive officers, directors and 10% stockholders will no longer be subject to the recovery of short-swing profits provision of the Exchange Act, and persons acquiring 5% of our common stock will no longer be required to report their beneficial ownership under the Exchange Act. Following the delisting of the Common Stock, any trading in the Common Stock would only occur in privately negotiated sales or potentially on the over-the-counter (OTC) market, if one or more brokers chooses to make a market for the Common Stock there and complies with applicable regulatory requirements; however, there can be no assurances regarding any such trading. The lack of public information and increased illiquidity could make trading in shares of the Common Stock more difficult, which could cause the value of the Common Stock to decrease.
- Accounting & Financial Operations - Risk 2We have not generated any revenue since our inception and expect to incur future losses and may never become profitable.
We have not generated any revenue. As of December 31, 2025, we have an accumulated deficit of $78.0 million, which includes a fair value adjustment of $26.6 million for warrants converted into Series A preferred stock on a cashless basis in connection with our IPO. The likelihood of our future success must be considered in light of the expenses, difficulties, complications and delays often encountered by companies in clinical development, including in connection with ongoing and future clinical trials and the emergence of competing products or therapies. These potential challenges include unanticipated clinical trial delays, poor data, changes in the regulatory and competitive landscape and additional costs and expenses that may exceed current budget estimates. Although we expect our general and administrative expenses to decrease when we cease to be a public company, we expect our research and development expenses to increase as we advance our clinical trials. In order to complete certain clinical trials and otherwise operate pursuant to our current business strategy, we anticipate that we will incur increased operating expenses. In addition, we expect to incur significant losses and experience negative cash flow in the future as we fund our operating losses and capital expenditures. We recognize that if we are unable to generate sufficient revenues or source funding, we will not be able to continue operations as currently contemplated, complete planned clinical trials and/or achieve profitability. Our failure to achieve or maintain profitability will also negatively impact the value of our shares. If we are unsuccessful in addressing these risks, then we may need to curtail our business activities. The future success of our business cannot be determined at this time, and we do not anticipate generating revenue from product sales in the near term. In addition, we have no experience in obtaining regulatory approval for and commercializing drug products on our own and face a number of challenges with respect to development and commercialization efforts, including, among other challenges: - having inadequate financial or other resources to complete the development of our product candidate; - the inability to manufacture our product in commercial quantities, at an adequate quality, at an acceptable cost or in collaboration with third parties; - experiencing delays or unplanned expenditures in product development, clinical testing or manufacturing; - the inability to establish adequate sales, marketing and distribution channels; - healthcare professionals may not adopt and patients may not accept our drug, if approved for marketing; - we may not be aware of possible complications or other side effects from the use of our product since we have limited clinical experience with respect to the actual effects from use of our product; - technological breakthroughs in reversing cannabis toxicity and treating patients experiencing intoxication symptoms may reduce the demand for our product, if it develops; - changes in the market for reversing cannabis toxicity and treating patients experiencing intoxication symptoms, new alliances between existing market participants and the entrance of new market participants may interfere with our market penetration efforts; - third-party payors may not agree to reimburse patients for any or all of the purchase price of our product, which may adversely affect patients' willingness to use our product; - uncertainty as to market demand may result in inefficient pricing of our product; - we may face third-party claims of intellectual property infringement; - we may fail to obtain or maintain regulatory approvals for our product in our markets or may face adverse regulatory or legal actions relating to our product even if regulatory approval is obtained; and - we are dependent upon the results of clinical studies relating to our product and the products of our competitors. If data from a clinical trial is unfavorable, we would be reluctant to advance the product for the indication for which it was being developed. If we are unable to meet any one or more of these challenges successfully, our ability to effectively obtain regulatory approval for and commercialize our products could be limited, which in turn could have a material adverse effect on our business, financial condition and results of operations.
- Debt & Financing - Risk 3We currently have no product revenue and will need to raise additional capital in the future, which may be unavailable to us or may cause dilution or place significant restrictions on our ability to operate.
We may be unable to generate sufficient revenue or cash flow to fund our operations. We expect that our cash and cash equivalents at December 31, 2025, along with access to funding under the Loan Agreement, will enable us to fund our current and planned operating expenses and capital expenditures for at least the next 12 months from the filing of this Quarterly Report. We have based these estimates on assumptions that may prove to be incorrect, and we may exhaust our available capital resources sooner than we currently expect. Because of the numerous risks and uncertainties associated with the development of our programs, we are unable to estimate the amounts of increased capital outlays and operating expenses associated with completing the research and development of our product candidate. Until such time, if ever, as we can generate substantial product revenue from sales of any of our current or future product candidates, we will need to seek additional equity or debt financing or potential collaboration, license or development agreements to provide the capital required to maintain or expand our operations, continue the development of our product candidate, build our sales and marketing capabilities, promote brand identity, develop or acquire complementary technologies, products or businesses, or provide for our working capital requirements and other operating and general corporate purposes. Other than the Loan Agreement, we currently do not have any arrangements or credit facilities as a source of funds, and we make no assurance that we will be able to raise sufficient additional capital in the future if needed on acceptable terms, or at all. Even if we draw down the entire $3 million available under the Loan Agreement, we will still require additional funding to fund our planned operations and capital expenditures. If such financing is not available on satisfactory terms, or is not available at all, we may be required to delay, scale back or eliminate the development of our current or future product candidates and other business, seek collaborations, or amend existing collaborations, for research and development programs at an earlier stage than otherwise would be desirable or for the development of programs that we otherwise would have sought to develop independently, or on terms that are less favorable than might otherwise be available, dispose of technology assets, or relinquish or license on unfavorable terms, our rights to technologies or any future product candidates that we otherwise would seek to develop or commercialize ourselves, pursue the sale of our company to a third party at a price that may result in a loss on investment for our stockholders, file for bankruptcy or cease operations altogether. This may materially adversely affect our operations and financial condition as well as our ability to achieve business objectives and maintain competitiveness. If we raise additional capital by issuing equity securities and/or equity-linked securities, the percentage ownership of our existing stockholders may be reduced, and accordingly these stockholders may experience substantial dilution. In addition, the Loan Agreement requires that we issue 0.03 shares of common stock per dollar loaned under the Loan Agreement, which will result in dilution to shareholders. We may also issue equity securities and/or equity-linked securities that provide for rights, preferences and privileges senior to those of our common stock. Given our need for cash and that equity and equity-linked issuances are very common types of fundraising for companies like us, the risk of dilution is particularly significant for our stockholders. Any future debt financing, if obtained, may involve agreements that include liens on our assets and covenants limiting or restricting our ability to take specific actions such as incurring additional debt. Debt financing could also be required to be repaid regardless of our operating results. If we raise additional funds through collaborations and licensing arrangements, we may be required to relinquish some rights to our current or future products or revenue streams or to grant licenses on terms that are not favorable to us. Any additional capital raising efforts may divert the attention of our management from day-to-day activities, which may adversely affect our ability to develop and commercialize our product candidates.
Risk Highlights Q4, 2025
Risk Word Cloud
Risk Factors Full Breakdown - Total Risks 49
- Share Price & Shareholder Rights - Risk 1ChangedWe are in the process of going private, which includes delisting our Common Stock from the Nasdaq Stock Market and deregistering our Common Stock under the Exchange Act.
As previously disclosed, on January 29, 2026, we announced the final results of the Offer, pursuant to which we accepted for payment an aggregate of 300,000 shares, including 134,306 "odd lots," of Common Stock at a purchase price of $3.50 per share, for an aggregate cost of approximately $1.05 million, excluding fees and expenses relating to the Offer. In accordance with our plan to "go private" following the completion of the Offer, on February 6, 2026, we notified Nasdaq of our intent to voluntarily delist the Common Stock from the Nasdaq and publicly announced such intent. We also announced our planned subsequent voluntary deregistration of the Common Stock with the SEC in order to terminate and suspend our reporting obligations under the Securities Exchange Act of 1934, as amended. We currently intend to file a Form 25 with the SEC to delist our Common Stock from Nasdaq on or about February 27, 2026. We expect the delisting of our Common Stock will be effective 10 days after we file the Form 25 with the SEC, and the deregistration of our Common Stock under Section 12(b) of the Exchange Act will take effect 90 days after the filing of the Form 25. We will also be required to terminate our registration under other applicable provisions of the Exchange Act by filing a Form 15. Anebulo intends to file a Form 15 with the SEC on or about February 27, 2026. When we file the Form 15 with the SEC, we must certify to the SEC that we have less than 300 stockholders. Upon filing the Form 15, Anebulo's obligation to file periodic reports with the SEC will be immediately suspended. During the ten-day period between the filing of the Form 25 and the Form 15, the number of holders of record can change due to broker "kick-outs", ordinary trading or intentional actions of stockholders. As a result of these changes in stock ownership, at the end of the ten-day period, it is possible that the number of our record holders could exceed 300, and we would be unable to file the Form 15 and complete the deregistration process. If this were to occur, we would have already delisted from Nasdaq and therefore would continue trade on the OTC. Following deregistration, we will no longer file annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. Accordingly, there will be significantly less information regarding our company available to stockholders and potential investors. In addition, we will no longer be subject to the provisions of the Sarbanes-Oxley Act and certain of the liability provisions of the Exchange Act, although we will still be subject to the antifraud provisions of the Exchange Act and any applicable state securities laws. Following deregistration, our executive officers, directors and 10% stockholders will no longer be required to file reports relating to their transactions in our common stock with the SEC. In addition, our executive officers, directors and 10% stockholders will no longer be subject to the recovery of short-swing profits provision of the Exchange Act, and persons acquiring 5% of our common stock will no longer be required to report their beneficial ownership under the Exchange Act. Following the delisting of the Common Stock, any trading in the Common Stock would only occur in privately negotiated sales or potentially on the over-the-counter (OTC) market, if one or more brokers chooses to make a market for the Common Stock there and complies with applicable regulatory requirements; however, there can be no assurances regarding any such trading. The lack of public information and increased illiquidity could make trading in shares of the Common Stock more difficult, which could cause the value of the Common Stock to decrease.
- Share Price & Shareholder Rights - Risk 2Our certificate of incorporation provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for substantially all disputes between us and our stockholders, and federal district courts will be the sole and exclusive forum for Securities Act claims, which could limit our stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.
Our certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by our directors, officers or other employees to us or to our stockholders, (iii) any action asserting a claim against us or any director, officer or other employee arising pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or bylaws or (iv) any action asserting a claim governed by the internal affairs doctrine, in all cases to the fullest extent permitted by law and subject to the court having personal jurisdiction over the indispensable parties named as defendants; provided that these provisions of our certificate of incorporation will not apply to suits brought to enforce a duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction. Our certificate of incorporation further provides that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act, unless we consent in writing to the selection of an alternative forum. We note that investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. The choice of forum provisions may limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our current or former directors, officers, or other employees or stockholders, which may discourage such lawsuits against us and our current or former directors, officers, and other employees or stockholders. Alternatively, if a court were to find the choice of forum provisions contained in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, financial condition and results of operations.
- Share Price & Shareholder Rights - Risk 3Anti-takeover provisions in our charter documents could discourage, delay or prevent a change in control of our company and may affect the trading price of our common stock.
Our corporate documents and Delaware corporate law contain provisions that may enable our board of directors to resist a change in control of our company even if a change in control were to be considered favorable by you and other stockholders. These provisions: - authorize the issuance of "blank check" preferred stock that could be issued by our board of directors to help defend against a takeover attempt; - provide that vacancies on our board of directors, including vacancies as a result of removal or enlargement of the board of directors, may be filled by directors then in office, even though less than a quorum; - establish that our board of directors is divided into three classes, with each class serving three-year staggered terms; - specify that special meetings of our stockholders can be called only by our board of directors, chief executive officer or the chairman of our board of directors; - Require that any action required or permitted to be taken by our stockholders must be effected at a duly called annual or special meeting, and not by written consent - establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors; - include a forum selection clause, which means certain litigation can only be brought in Delaware; and - require supermajority stockholder voting to effect amendments to our bylaws and certain amendments to our certificate of incorporation. In addition, Delaware corporate law prohibits large stockholders, in particular those owning 15% or more of our outstanding voting stock, from merging or consolidating with us except under certain circumstances. These provisions and other provisions under Delaware corporate law could discourage, delay or prevent a transaction involving a change in control of our company. These provisions could also discourage proxy contests and make it more difficult for our stockholders to elect directors of their choosing and cause us to take other corporate actions our stockholders desire.
- Share Price & Shareholder Rights - Risk 4Our principal stockholders and management own a substantial majority of our stock and will be able to exert significant control over matters subject to stockholder approval.
Certain of our executive officers, directors and large stockholders own a substantial majority of our outstanding capital stock. As a result of their share ownership, these stockholders have the ability to influence us through their ownership positions. These stockholders may be able to determine all matters requiring stockholder approval. For example, these stockholders, acting together, can control elections of directors, amendments of our organizational documents, or approval of any merger, sale of assets, or other major corporate transaction. This may prevent or discourage unsolicited acquisition proposals or offers for our common stock that you may believe are in your best interest as one of our stockholders. Joseph F. Lawler M.D., Ph.D., our founder and a member of our Board of Directors, is the founder and Managing Member of JFL, and Aron R. English, the President and Portfolio Manager of 22NW, and Nathaniel Calloway, the lead for 22NW, are each members of our Board of Directors. Due to their positions with JFL and 22NW, such individuals may also exert significant control over certain matters. Furthermore, if we draw down amounts under the Loan Agreement, we will issue to the lenders 0.03 shares of common stock per dollar loaned under the Loan Agreement.
- Share Price & Shareholder Rights - Risk 5Future sales, or the perception of future sales, of a substantial number of our shares of common stock could depress the trading price of our common stock.
If we or our stockholders, particularly our officers, directors and large stockholders, sell a significant percentage of our outstanding common stock in the public market or if the market perceives that these sales could occur, the market price of shares of our common stock could decline. These sales may make it more difficult for us to sell equity or equity-linked securities in the future at a time and price that we deem appropriate, or to use equity as consideration for future acquisitions.
- Share Price & Shareholder Rights - Risk 6The trading price and volume of our common stock in the public markets has experienced, and may in the future experience, volatility due to a variety of factors, many of which are beyond our control.
The trading price and volume of our common stock on The Nasdaq Capital Market has experienced, and may in the future experience, volatility. The market price of our common stock may fluctuate substantially as a result of many factors, some of which are beyond our control. These fluctuations could cause you to lose all or part of the value of your investment in our common stock. Factors that could cause fluctuations in the market price of our common stock include the following: - quarterly variations in our results of operations; - results of operations that vary from the expectations of securities analysts and investors; - results of operations that vary from those of our competitors; - changes in expectations as to our future financial performance, including financial estimates by securities analysts; - publication of research reports about us or the pharmaceutical industry; - announcements by us or our competitors of significant contracts, acquisitions or capital commitments; - announcements by third parties of significant claims or proceedings against us; - changes affecting the availability of financing in the wholesale and consumer lending markets; - regulatory developments in the pharmaceutical industry;- significant future sales of our common stock, and additions or departures of key personnel; - the realization of any of the other risk factors presented in this Annual Report; and - general economic, market and currency factors and conditions unrelated to our performance. In addition, the stock market in general has experienced significant price and volume fluctuations that have often been unrelated or disproportionate to operating performance of individual companies. These broad market factors may seriously harm the market price of our common stock, regardless of our operating performance. In the past, following periods of volatility in the market price of a company's securities, securities class action litigation has often been instituted. A class action suit against us could result in significant liabilities and, regardless of the outcome, could result in substantial costs and the diversion of our management's attention and resources.
- Share Price & Shareholder Rights - Risk 7If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our stock adversely, or if our actual results differ significantly from our guidance, our stock price and trading volume could decline.
The trading market for our common stock is influenced by the research and reports that industry or securities analysts may publish about us, our business, our market or our competitors. If any of the analysts who may cover us change their recommendation regarding our stock adversely, or provide more favorable relative recommendations about our competitors, our stock price would likely decline. If any analyst who may cover us were to cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. In addition, from time to time, we may release earnings guidance or other forward-looking statements in our earnings releases, earnings conference calls or otherwise regarding our future performance that represent our management's estimates as of the date of release. Some or all of the assumptions of any future guidance that we furnish may not materialize or may vary significantly from actual future results. Any failure to meet guidance or analysts' expectations could have a material adverse effect on the trading price or volume of our stock.
- Share Price & Shareholder Rights - Risk 8We have a limited operating history as a publicly traded company, and our inexperience could materially and adversely affect us and our stockholders.
We became a public company in May 2021 and, therefore, we have a limited operating history as a publicly traded company. Our board of directors and management team have overall responsibility for our management. As a publicly traded company, we are required to develop and implement substantial control systems, policies and procedures in order to satisfy our periodic SEC reporting and Nasdaq obligations. We cannot assure you that management's past experience will be sufficient to successfully develop and implement these systems, policies and procedures and to operate our company. Failure to do so could jeopardize our status as a public company, and the loss of such status may materially and adversely affect us and our stockholders.
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