Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 40

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1
Chunk 40
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drugs and formulations, particularly outsourced compounded drugs and formulations, in the marketplace.

 25 

An incident
similar to the fungal meningitis outbreak in 2012, which was caused by a compounding pharmacy employing a non-sterile-to-sterile business
model, could cause our customers to reduce their use of compounded formulations significantly or even stop using compounded drugs altogether.
States have in the past, and could in the future, enact regulations prohibiting or restricting the use of compounding pharmacies and
outsourcing facilities in response to such incidents. Such prohibitions or restrictions by states or reduced customer demand as a result
of an incident with compounded drugs and formulations could have a material adverse effect on our business, results of operations and
financial condition.

We have received multiple FDA
Forms 483, a MedWatch notice, warning letters and other regulatory notifications relating to issues at NJOF and our pharmacy RxNJ,
and have ongoing communications with the FDA about compliance and quality plans at NJOF. See “—We have been in discussions with the federal government regarding past FDA inspections of our 503B
facility, and to the extent we are unable to demonstrate compliance with cGMPs and other required regulations, the government could
pursue enforcement actions, the effects of which could be costly to us and could result in adverse consequences to our
business.” As a result of the MedWatch notice, warning letters and other regulatory notifications, some physicians may be
hesitant to prescribe and some patients may be hesitant to purchase and use non-FDA-approved compounded formulations, particularly
when an FDA-approved potential alternative is available. For other reasons, physicians may be unwilling to prescribe or patients may
be unwilling to use our proprietary compounded formulations, including, but not limited to, the following: legal prohibitions on our
ability to discuss the efficacy or safety of our formulations with potential users to the extent applicable data is available; our
pharmacy operations are primarily operating on a cash-pay basis and reimbursement may or may not be available from third-party
payors, including the government Medicare and Medicaid programs; and certain formulations are not required to be prepared and are
not presently being prepared in a manufacturing facility governed by cGMP requirements. Any failure by physicians, patients and/or
third-party payors to accept and embrace compounded formulations could substantially limit our market and cause our operations to
suffer.

Our business and operations
could suffer in the event of cybersecurity or other system failures.

Despite the implementation of
security measures, our