Predictive Technology Group (PREDQ) Risk Analysis
Risk Overview Q1, 2021
Source: the company's latest filing for the period ended Mar 31, 2021, filed May 17, 2021
Risk Change Over Time
No filing history is available.
- Share Price & Shareholder Rights - Risk 1In the event that we become Our common stock is not listed on the NASDAQ a major exchange and there is no assurance that we will be able to maintain that obtain such a listing.
Our common stock currently trades on the Over-The-Counter markets under the symbol PRED. As a result of the suspension of trading in our stock by the SEC in April 2020, trading in our stock was moved from the PTC Pink Sheets to the OTC Gray Sheets. The Over-The-Counter market in general and the Gray sheets in particular are considered to be a less efficient system than listing on markets such as NASDAQ or other national exchanges because of lower trading volumes, transaction delays and reduced security analyst and news media coverage. These factors could contribute to lower prices and larger spreads in the bid and ask prices for our common stock. Additionally, trading of our common stock on the Over-The-Counter markets may make us less desirable to institutional investors and may, therefore, limit our future equity funding options and could negatively affect the liquidity of our stock. We are seeking to resume trading on the OTC Pink Sheets and simultaneously seeking a listing on NASDAQ. There can be no assurance that our common stock will qualify to resume trading on the OTC Pink Sheets. We currently do not qualify for a listing on NASDAQ and there can be no assurance that we will qualify for a NASDAQ listing in the future. In addition, if a NASDAQ listing is obtained then we will be subject to continued listing requirements to maintain the listing and to avoid delisting. Our results of operations and our current and fluctuating stock price directly impact our ability to satisfy these listing standards.
- Debt & Financing - Risk 2We may not be successful in obtaining adequate reimbursement for our genetic services and products.
Our ability to successfully commercialize any genetic test or treatments we develop, and the ability of any future collaborative partners, if any, to successfully commercialize such products, depends in part on obtaining adequate reimbursement for such services and products and related treatments from government and private health care insurers (including health maintenance organizations) and other third-party payers. Physicians' decisions to recommend genetic tests and treatments, as well as patients' elections to pursue testing and treatments, are likely to be heavily influenced by the scope and extent of coverage for such tests by third-party payers. Government and private third-party payers are increasingly attempting to contain health care costs by limiting both the extent of coverage and the reimbursement rate for new diagnostic and therapeutic products and services. In particular, services which are determined to be investigational in nature or which are not considered "reasonable and necessary" for diagnosis or treatment may be denied reimbursement coverage. If adequate reimbursement coverage is not available from third-party payers, there can be no assurance that individuals will elect to pay directly for the genetic testing and treatments and market acceptance of the genetic testing and treatments will likely be adversely impacted, which would have a material adverse effect on our business, financial condition and results of operations. In addition, Medicare often permits coverage decisions to be made by its carriers and intermediaries, leading to different coverage decisions in various parts of the United States. Disapproval of, or limitations in, coverage by the United States Health Care Financing Administration ("HCFA") or other third-party payers, as well as inadequate payment levels, could have a material adverse effect on our future revenues. A key component in the reimbursement decision by HCFA and most private insurers is the development of Current Procedural Terminology ("CPT") codes, which are used in the submission of claims to insurers for reimbursement for medical services. CPT codes are developed, maintained, and revised by a committee of medical specialists which is administered by the American Medical Association ("AMA"). Currently, reimbursement for genetic testing and treatments is made on the basis of CPT codes that may not accurately reflect the complexity or sophistication of specific genetic tests. There can be no assurance that specific CPT codes will be implemented for any genetic testing or treatments developed by us. Failure to secure recognition of such CPT codes would have a material adverse effect on our business, financial condition, and results of operations.
- Corporate Activity and Growth - Risk 3There can be no assurance that we will be able to maintain or develop appropriate collaborative arrangements that will be necessary for us to develop and commercialize our genetics products and services.
Our current strategy is to rely, in part, on collaborative arrangements to develop and commercialize products based on gene discoveries. There can be no assurance that we will be able to negotiate acceptable collaborative arrangements, or that any collaborative arrangement will be successful. In addition, there can be no assurance that our collaborative partners will not pursue alternative technologies or develop alternative products either on their own or in collaboration with others, including with our competitors, as a means of developing diagnostic products or treatments for the diseases targeted by the collaborative programs. Milestone payments are frequently built into collaborative arrangements relating to gene discoveries. It is anticipated that our receipt of a substantial portion of the potential milestone payments under future collaborative agreements, if any, is dependent upon the efforts of our strategic collaborators. Failure of any collaborative arrangement could have a material adverse effect on our business, financial condition, or results of operations. Additionally, there can be no assurance that disputes over rights or technology or other proprietary interests will not arise. Such disputes or disagreements between with future collaborative partners could lead to delays in collaborative research projects, or could result in litigation or arbitration, any of which could have a material adverse effect on our business, financial condition or results of operations.
Risk Highlights Q1, 2021
Risk Word Cloud
Risk Factors Full Breakdown - Total Risks 41
- Share Price & Shareholder Rights - Risk 1Our ownership of Juneau is not fully paid
We currently own 48.3 percent of Juneau. We have fully paid for 40.0 percent of our ownership in Juneau and owe an additional $7,206,610 for the remainder of our interest. We are paying this amount in monthly installments for a period ending in November 2021. The company is currently in arrears on the subscription payments, and failure to pay the monthly installments may result in our loss of the Juneau equity that has not been paid. There can be no assurance that we will be able to pay for the entire outstanding balance.
- Share Price & Shareholder Rights - Risk 2The price of our common stock has been, and will likely continue to be, volatile.
The market price of our common stock, like that of the securities of many other companies that are in, or are just emerging from, the development stage, has fluctuated over a wide range and it is likely that the price of our common stock will fluctuate in the future. The market price of our common stock could be impacted by a variety of factors, including: - Fluctuations in stock market prices and trading volumes of similar companies or of the markets generally;- Our ability to successfully launch, market and earn significant revenue from our products;- Our ability to obtain additional financing to support our continuing operations;- Disclosure of the details and results of regulatory applications and proceedings;- Changes in government regulations or our failure to comply with any such regulations;- Additions or departures of key personnel;- Our investments in research and development or other corporate resources;- Announcements of technological innovations or new commercial products by us or our competitors;- Developments in the patents or other proprietary rights owned or licensed by us or our competitors;- The timing of new product introductions;- Actual or anticipated fluctuations in our operating results, including any restatements of previously reported results;- Our ability to effectively and consistently manufacture our products and avoid costs associated with the recall of defective or potentially defective products;- Our ability and the ability of our distribution partners to market and sell our products;- Changes in reimbursement for our products or the price for our products to our customers;- Removal of our products from the Federal Supply Schedule, or changes in how government accounts purchase products such as ours or in the price for our products to government accounts;- Material amounts of short-selling of our common stock; and - The other risks detailed in this Annual Report. Further, due to the relatively fixed nature of most of our costs, which primarily include personnel costs as well as facilities costs, any unanticipated shortfall in revenue in any fiscal quarter would have an adverse effect on our results of operations in that quarter. These fluctuations could cause the trading price of our stock to be negatively affected. Our quarterly operating results have varied substantially in the past and may vary substantially in the future. In addition, the stock market and certain of the indices on which we are included have been very volatile in the recent past. This volatility is often not related to the operating performance of companies listed thereon and will probably continue in the foreseeable future.
- Share Price & Shareholder Rights - Risk 3Securities analysts may elect not to report on our common stock or may issue negative reports that adversely affect the stock price.
There is no assurance that any analysts will report on our common stock in the future. Rules mandated by the Sarbanes-Oxley Act and a global settlement reached in 2003 among the SEC, other regulatory agencies, and a number of investment banks led to a number of fundamental changes in how analysts are reviewed and compensated. In particular, many investment banking firms are required to contract with independent financial analysts for their stock research. If securities analysts discontinue covering our common stock, the lack of research coverage may adversely affect our actual and potential market price. The trading market for our common stock may be affected in part by the research and reports that industry or financial analysts publish about our business. If one or more analysts elect to cover us and then downgrade the stock, the stock price would likely decline rapidly. If one or more of these analysts cease coverage of us, we could lose visibility in the market, which in turn could cause our stock price to decline. This could have a negative effect on the market price of our shares.
- Share Price & Shareholder Rights - Risk 4Our charges to earnings resulting from acquisition, restructuring and integration costs may materially adversely affect the market value of our common stock.
We account for the completion of our acquisitions using the purchase method of accounting. We allocate the total estimated purchase prices to net tangible assets, amortizable intangible assets and indefinite-lived intangible assets, and based on their fair values as of the date of completion of the acquisitions, record the excess of the purchase price over those fair values as goodwill. Our financial results, including earnings per share, could be adversely affected by a number of financial adjustments required in purchase accounting including the following: - We will incur additional depreciation expense as a result of recording purchased tangible assets. - To the extent the value of goodwill or intangible assets becomes impaired, we may be required to incur material charges relating to the impairment of those assets. - Cost of sales may increase temporarily following an acquisition as a result of acquired inventory being recorded at its fair market value. - Earnings may be affected by changes in estimates of future contingent consideration to be paid when an earn-out is part of the consideration. - Earnings may be affected by transaction and implementation costs, which are expensed immediately.
- Share Price & Shareholder Rights - Risk 5Substantial future sales of our common stock by us or by our existing stockholders could cause our stock price to fall.
Additional equity financings or other share issuances by us, including shares issued in connection with strategic alliances and corporate partnering transactions, could adversely affect the market price of our common stock. Sales by existing stockholders of a large number of shares of our common stock in the public market or the perception that additional sales could occur could cause the market price of our common stock to drop.
- Share Price & Shareholder Rights - Risk 6We have experienced volatility in the price of our stock and are subject to volatility in the future.
The price of our common stock has experienced significant volatility. The high and low bid quotations for our common stock, as reported by the OTC Markets, ranged between a high of $1.81 and a low of $0.10 during the past 12 months. The historic market price of our common stock may be higher or lower than the price paid for our shares and may not be indicative of future market prices, depending on many factors, some of which are beyond our control. As a result, investors may be unwilling to purchase our common stock and our market price may be affected. The price of our stock may change dramatically in response to our success or failure and based upon our relationship and the decisions of our Chief Executive Officer.
- Share Price & Shareholder Rights - Risk 7Our common stock is not listed on a major exchange and there is no assurance that we will be able to obtain such a listing.
Our common stock currently trades on the Over-The-Counter markets under the symbol PRED. As a result of the suspension of trading in our stock by the SEC in April 2020, trading in our stock was moved from the PTC Pink Sheets to the OTC Gray Sheets. The Over-The-Counter market in general and the Gray sheets in particular are considered to be a less efficient system than listing on markets such as NASDAQ or other national exchanges because of lower trading volumes, transaction delays and reduced security analyst and news media coverage. These factors could contribute to lower prices and larger spreads in the bid and ask prices for our common stock. Additionally, trading of our common stock on the Over-The-Counter markets may make us less desirable to institutional investors and may, therefore, limit our future equity funding options and could negatively affect the liquidity of our stock. We are seeking to resume trading on the OTC Pink Sheets and simultaneously seeking a listing on NASDAQ. There can be no assurance that our common stock will qualify to resume trading on the OTC Pink Sheets. We currently do not qualify for a listing on NASDAQ and there can be no assurance that we will qualify for a NASDAQ listing in the future. In addition, if a NASDAQ listing is obtained then we will be subject to continued listing requirements to maintain the listing and to avoid delisting. Our results of operations and our current and fluctuating stock price directly impact our ability to satisfy these listing standards.
See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.
