374 ◾ The Guide to Entrepreneurship: How to Create Wealth for Your Company
REGULATORY RISKS
The Failure to Complete Development of Our Medical
Technology, Obtain Government Approvals, Including
Required FDA Approvals, or to Comply With Ongoing
Governmental Regulations Could Delay or Limit Introduction
of Our Proposed Products and Result in Failure to
Achieve Revenues or Maintain Our Ongoing Business
Our research and development activities, and the manufacture and market-
ing of our products, including our intended coronary artery bypass graft
product, is subject to extensive regulation for safety, efcacy and qual-
ity by numerous government authorities in the United States and abroad.
Before receiving clearance from the Food and Drug Administration (“FDA”)
to market our proposed graft, we will have to demonstrate that our grafts
are safe and effective on the patient population. While we have done some
preliminary animal trials and have seen acceptable results, there can be no
assurance that acceptable results will be obtained in human trials. Clinical
trials and manufacturing and marketing of medical devices are subject to the
rigorous testing and approval processes of the FDA and equivalent foreign
regulatory authorities. The Federal Food, Drug and Cosmetic Act and other
federal, state and foreign statutes and regulations govern and inuence the
testing, manufacture, labeling, advertising, distribution and promotion of
drugs and medical devices. As a result, clinical trials and regulatory approval
of the coronary artery bypass graft can take a number of years or longer to
accomplish and will require the expenditure of substantial nancial, mana-
gerial and other resources.
In order to be commercially viable, we must successfully research,
develop, obtain regulatory approval for, manufacture, introduce, market, and
distribute our grafts. We must successfully meet a number of critical devel-
opmental milestones, including:
◾ demonstrate benet from the use of our grafts in various contexts such
as coronary artery bypass surgery;
◾ demonstrate through pre-clinical and clinical trials that our grafts are
safe and effective; and
◾ establish a viable good manufacturing process capable of potential
scale-up.