Risk Factors Dashboard

Once a year, publicly traded companies issue a comprehensive report of their business, called a 10-K. A component mandated in the 10-K is the ‘Risk Factors’ section, where companies disclose any major potential risks that they may face. This dashboard highlights all major changes and additions in new 10K reports, allowing investors to quickly identify new potential risks and opportunities.

Risk Factors - MRZM

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Item 1A. Risk Factors.” Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. Given these uncertainties, you should not place undue reliance on these forward-looking statements.

You should read this Annual Report on Form 10-K and the documents that we reference and have filed as exhibits to the Annual Report on Form 10-K completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of the forward-looking statements in this Annual Report on Form 10-K by these cautionary statements. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

Use of Terms

In this report, “we,” “us,” “our,” “our company”, “Marizyme” and similar references refer to Marizyme, Inc., a Nevada corporation, and its wholly-owned subsidiaries, Somahlution, Inc., a Delaware corporation (“Somahlution, Inc.”), Somaceutica, Inc., a Florida corporation (“Somaceutica”), Marizyme Sciences, Inc., a Florida corporation (“Marizyme Sciences”), and My Health Logic Inc., a corporation incorporated pursuant to the laws of the Province of Alberta, Canada (“My Health Logic”), and (ii) the term “common stock” refers to the common stock, par value $0.001 per share, of Marizyme, Inc., a Nevada corporation. The financial information included herein is presented in United States dollars, or U.S. Dollars, the functional currency of our company.

Note Regarding Trademarks, Trade Names and Service Marks

Solely for convenience, our trademarks and tradenames referred to in this report may appear without the ® or ™ symbols, but such references are not intended to indicate in any way that we will not assert, to the fullest extent under applicable law, our rights to these trademarks and tradenames.

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Summary of Risk Factors

The following is a summary of material risks that could affect our business. This summary may not contain all of our material risks, and it is qualified in its entirety by the more detailed risk factors set forth under “Item 1A. Risk Factors”.

Risks Related to Our Business

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Risks Related to Government Regulation

Risks Related to This Offering and Ownership of Our Securities

ITEM 1. BUSINESS

Company Overview

Marizyme, Inc. (“Marizyme” or the “Company”) is a medical technology company changing the landscape of cardiac care by delivering innovative solutions for coronary artery bypass graft (CABG) surgery.

Since October 2023, DuraGraft has been authorized for marketing by the U.S. Food and Drug Administration, or FDA, for use as an intra-operative vascular conduit storage and flushing solution used during CABG surgeries in the United States, subject to applicable risks, mitigation requirements, and control provisions. Since August 2014, DuraGraft has also had the CE marking required to be sold in the EEA, and DuraGraft has therefore been assessed as meeting the EEA safety, health, and environmental protection requirements.

With DuraGraft receiving its FDA clearance, Marizyme is now working toward its utilization and revenue generation in the United States. The U.S. commercialization plan is focused on penetrating and driving utilization in hospital integrated networks and the cardiac suite, utilizing a small targeted and efficient direct sales force, direct sales targeting with patient focus on diabetics, and high-risk patients and utilizing digital marketing. The Company intends to generate revenues based on its persuasive clinical data and indication for use.

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As part of its U.S. commercialization plan, Marizyme has been working with a large hospital integrated network to execute on a strategic collaboration for a planned multi-center randomized DuraGraft™ clinical trial in the U.S. and a utilization agreement to use DuraGraft™ across a large network of hospitals.

These initiatives will be in addition to continued efforts to expand DuraGraft™ sales in Europe and Asia. The Company continues to work closely with distributors in Austria, Spain, the United Kingdom, Italy, Singapore, Turkey, and the Philippines, among others.

We also continue to focus on the development of MAR-FG-001, a technology for use in fat grafting procedures formulated as a tumescent solution base for protecting adipose tissue during adipose tissue harvesting and storage.

We have either paused or significantly slowed down the development of our other pipeline technologies, including Krillase, and MATLOC. Our MATLOC CKD point-of-care device is still being developed through a Sponsored Research Agreement, or SRA. An SRA is an agreement (which may be classified as a grant, contract or cooperative agreement) under which one party (the “Sponsor”) provides funding to a second party to support the performance of a specified research project or related activity. The Sponsor may be a foundation, government agency, for-profit entity, research institute, or another university. Apart from the SRA, no additional capital is going to the Krillase or MATLOC pipeline technologies.

In the near term, we expect to generate revenue primarily from the sale of DuraGraft through the expansion of our international marketing efforts by our distribution partners in Europe and in other countries that accept CE marking. We intend to commercialize DuraGraft in the U.S. primarily through hospital integrated networks using our own direct sales force. We anticipate that once we commence marketing and sales operations for DuraGraft in the U.S., we will be able to generate sustainable revenue growth and continue the expansion od DuraGraft and expedite the development of MAR-FG-001 into medical products.

Our Corporate History and Structure

Marizyme, Inc. is a Nevada corporation that was incorporated on March 20, 2007. From 2007 to early 2018, we operated under a number of different names with different management teams and in different industries. We changed our name to Marizyme, Inc. on March 21, 2018, to reflect our new life science focus, and at that time we also changed our common stock ticker symbol to “MRZM.

In September 2018, we acquired assets relating to Krillase®, a technology intended for the treatment of certain harmful blockages, plaque and biofilms, from ACB Holding AB, Reg. No. 559119-5762, a company incorporated and organized under the laws of Sweden (“ACB Holding”). In July 2020, we acquired from Somahlution, Inc., a Delaware corporation (“Somahlution, Inc.”), Somahlution, LLC, a Delaware limited liability company (“Somahlution, LLC”), and Somaceutica LLC, a Delaware limited liability company (“Somaceutica LLC”), which we refer to together as “Somahlution,” all of the assets of Somahlution, including our DuraGraft-related assets, as well as the outstanding capital stock of Somahlution, Inc., which we refer to as the “Somahlution Assets.” In December 2021, we acquired My Health Logic and assets relating to MATLOC®, a technology intended for the screening of biomarkers relating to CKD, from Health Logic Interactive Inc. (“HLII”). In connection with the My Health Logic acquisition, David Barthel, former chief executive officer of HLII and My Health Logic, became our Chief Executive Officer and a member of our board of directors; George Kovalyov, previously the chief operating officer and a director of HLII, became our Chief Financial Officer and Treasurer; and Harrison Ross, previously the Chief Financial Officer of HLII, became our Vice President of Finance.

The Company previously planned to develop and commercialize FDA-approved products based on the Krillase assets. We suspended these plans due to our determination to prioritize the completion of regulatory processes to obtain FDA authorization for the commercialization of DuraGraft in the United States and the development of a functional MATLOC device prototype and MAR-FG-001-based viable products. We intend to maintain the Krillase assets for potential future development and commercialization or disposition. Any determination as to these matters would be based on a number of factors. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Principal Factors Affecting Our Financial Performance” for a summary of factors that we may consider in this respect.

There is no assurance that any of our intellectual property assets will ever be developed and fully commercialized and generate significant revenues or will ever attract significant interest from potential buyers or investors. See “Risk Factors – Risks Related to Our Business – We may not be able to monetize intangible assets, which may result in the need to record an impairment charge.

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Our Products

DuraGraft®

Through our acquisition of the Somahlution Assets in July 2020, we acquired key intellectual assets based on a patent-protected cytoprotective platform technology designed to reduce ischemic injury to organs and tissues in grafting and transplantation surgeries. These assets include DuraGraft, a first-in-class, De Novo granted and CE marked intra-operative vascular graft storage and flushing solution used during CABG surgeries.

DuraGraft is the first and only medical product that has received authorization by the FDA for marketing for use as an intra-operative vascular conduit storage and flushing solution used during CABG surgeries.

Further, DuraGraft carries CE marking and is approved for marketing in 36 countries outside the United States on three continents, including all countries in the European Union, or the EU, including Spain, Austria, Ireland, Germany, and Italy, as well as countries outside the EU including the United Kingdom, or the UK, Turkey, Switzerland, Chile, and the Philippines. DuraGraft is also the only patented product for this indication. The DuraGraft patent portfolio includes granted patents and pending applications in over 30 countries throughout the world, including patents granted in the United States, Europe, Australia, India, Argentina, South Africa, Mexico, and several Asian countries.

Cardiac care is a large and growing industry. According to the U.S. Centers for Disease Control and Prevention, or CDC, the estimated average annual US cost of coronary heart disease is $219 billion (Centers for Disease Control and Prevention, Office of Policy, Performance, and Evaluation, “Health Topics – Heart Disease and Heart Attack.” POLARIS, August 17, 2021). According to a market analysis report, the size of the CABG procedures market globally was approximately $10.2 billion as of 2022 (Rahul Gotadki, Market Research Future, “Coronary Artery Bypass Graft Market Research Report Information By Type (Off-Pump, On-Pump, Minimally Invasive Direct CABG, Endoscopic Vein Harvesting and Others), By Procedure (Single CABG Surgery, Double CABG Surgery, Triple CABG Surgery, Quadruple CABG Surgery and Others), By End-User (Hospitals, Cardiology Clinics, Research Institutes and Others), and By Region (North America, Europe, Asia-Pacific, And Rest Of The World) – Market Forecast Till 2030.”, July 2023). The same source reports that this market is forecast to increase at a compound annual growth rate, or CAGR, of 8.20% between 2023 and 2030. Globally, it is estimated that more than 1 million CABG procedures are performed worldwide each year (Gaudino, Mario, Weill Cornell Medicine, “Method Using Artery for Coronary Artery Bypass Linked to Better Long-term Outcomes Than Using Vein,” July 14, 2020), with procedures performed in the U.S. being a substantial percentage of the total global procedures performed. According to the American Heart Association, CABG is the most common type of open-heart surgery in the United States with more than 500,000 surgeries performed each year (The Society of Thoracic Surgeons, “Coronary Artery Bypass Grafting (CABG).The Patient Guide to Heart, Lung, and Esophageal Surgery, May 2019).

With DuraGraft™, patients can benefit through:

Reduced wall thickening, which is the earliest detectable sign of vein graft disease.
Prevention of oxidative damage, therefore slowing the progression of vein graft failure.

Oxidative damage is the primary mediator of ischemic injury.
The reduction of oxidative damage maintains the structural and functional integrity of vascular conduits.

Reduced mortality – DuraGraft was shown to reduce mortality at 3 years post-CABG.

Hospitals and Physicians receive benefits through:

The mechanism of action for DuraGraft is through the reduction of oxidative damage which maintains the structural and functional integrity of vascular conduits.

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Marketing DuraGraft

Having received FDA authorization for marketing of DuraGraft, we are proceeding with our plans to commercialize DuraGraft in the United States and continue to generate international revenue growth from sales of DuraGraft. In the U.S. marketplace, we intend to employ a small direct sales force focusing on marketing and sales to hospital integrated networks. We have also begun the process of developing the U.S. CABG market for DuraGraft with select clinical studies, the development of known opinion leaders, or KOLs, the promotion of existing publications, and digital marketing. We will also seek to develop and commercialize additional applications for the technology underlying DuraGraft.

Our DuraGraft commercialization plan using its CE marking and existing distribution partners in select European and Asian countries resumed in the second quarter of 2022, with a targeted approach based on market access, existing KOLs, clinical data and revenue penetration. In Europe and elsewhere, we will continue our DuraGraft marketing efforts relying on our DuraGraft CE marking and our distribution partners. The CE marking signifies that DuraGraft may be sold in the EEA and that DuraGraft has been assessed as meeting safety, health, and environmental protection requirements. We are currently working with local distributors of cardiovascular disease-related products, in accordance with local regulatory requirements, to sell and increase the market share of DuraGraft in Spain, Austria, Switzerland, Germany, Chile, Turkey, Italy, and the UK among others.

MATLOC®

In December 2021, we acquired My Health Logic, its lab-on-chip technology platform and its in-development patient-centric, digital point-of-care screening and diagnostic device, MATLOC. Our MATLOC CKD point-of-care device is still being developed through a Sponsored Research Agreement, otherwise all capital and effort toward the project has been paused due to the capital position of the Company.

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MAR-FG-001

In November 2021, we reinitiated the development of MAR-FG-001, our fat grafting technology. MAR-FG-001 is a tumescent solution base for fat grafting procedures that may be used for plastic and cosmetic surgeries. The Company intends to develop MAR-FG-001 for use during these and other fat grafting procedures.

Fat grafting is a surgical process used in medical reconstructive and other plastic surgery procedures in which fat is transferred from one area of the body to another (known as “autologous fat grafting” or simply “fat grafting”) to correct a defect, replace injured tissue, or to make cosmetic enhancements.

Compared to standard solutions, we believe that MAR-FG-001 could better protect adipose tissue from ischemic and oxidative injury and increase adipocyte and stromal cell viability, which is key to improving retention of fat volume thereby improving patient outcomes following fat grafting procedures.

The global market for autologous fat grafting was estimated to be $699.96 million in 2021 and was projected to grow at a CAGR of 8.62% until 2028 (“Global Autologous Fat Grafting Market – Industry Trends and Forecast to 2028,” Data Bridge Market Research, December 2020). Growing preference for the use of non-invasive aesthetic techniques in skin rejuvenation, more rapid recovery with lesser allergic risks and reduced downtime compared to other procedures are some of the factors contributing to increasing demand. The adoption rate for autologous fat grafting procedures in the United States was 2.2% of all augmentation and reconstruction procedures as of 2018, suggesting significant potential for growth of adoption of these procedures (“Autologous Fat Grafting Market Analysis By Product (Integrated Fat Transfer Systems, Aspiration and Harvesting Systems, Liposuction Systems, Fat Processing Systems, De-epithelialization Devices), By Application & Region - Global Market Insights 2021 to 2031,” Fact.MR, March 2022). With approximately 22.4 million plastic surgeries performed in the United States in 2020 (American Society of Plastic Surgeons, “Plastic Surgery Statistics Report – 2020,” April 27, 2021), there is potential for widespread implementation of innovative fat grafting systems.

MAR-FG-001 is currently in development and is not yet available for sale in any markets.

Our Competitive Strengths

We believe that the following competitive strength will enable us to compete effectively:

Superior, first-in-class vascular graft storage and flushing solution. DuraGraft is the first and only medical product that has received authorization by the FDA for marketing for use as an intra-operative vascular conduit storage and flushing solution used during CABG surgeries. DuraGraft is also the only product certified for marketing in Europe and other jurisdictions for this indication.

Our Growth Strategies

We will strive to grow our business by pursuing the following key growth strategies:

Commercialize DuraGraft.
Develop MAR-FG-001 fat grafting technology and related products.

The strategic plans described above will require capital. We will not receive any of the required capital in this offering except upon the exercise of warrants held by the selling stockholders for issuance of the shares of common stock that are being registered for resale by the registration statement of which this prospectus forms a part. There can be no assurances that we will be able to raise the capital that we need to execute our plans or that capital, whether through securities offerings, either private or public, will be available to us on acceptable terms, if at all. An inability to raise sufficient funds could cause us to scale back our development and growth plans or discontinue them altogether. IIn addition, the Company is dependent upon certain contract manufacturers and suppliers and their ability to reliably and efficiently fulfill its orders is critical to the Company’s business success. The COVID-19 pandemic has impacted and may continue to impact certain of the Company’s manufacturers and suppliers. As a result, the Company has faced and may continue to face delays or difficulty sourcing certain products, which could negatively affect the Company’s business and financial results.

While it is not possible at this time to estimate the total impact that COVID-19 could have on our business in the future, the continued spread of COVID-19 and variants of the virus, the rate of vaccinations regionally and globally and the measures taken by the government authorities, and any future epidemic disease outbreaks, could: Disrupt the supply chain and the manufacture or shipment of products and supplies for use by us in our research activities and by strategic partners for their distribution and sales activities; delay, limit or prevent us in our research activities and strategic partners in their distribution and sales activities; impede our negotiations with strategic partners; impede testing, monitoring, data collection and analysis and other related activities by us; interrupt or delay the operations of the FDA or other regulatory authorities, which may impact review and approval timelines for initiation of clinical trials or marketing; or impede the launch or commercialization of any approved products; any of which could delay our strategic partnership plans, increase our operating costs, and have a material adverse effect on our business, financial condition and results of operations.

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For further discussion of the impact of the COVID-19 pandemic on our business, please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, and Risk Factors – Risks Related to Our Business – The COVID-19 pandemic has adversely impacted the Company’s supply chain and could materially and adversely affect our ability to conduct clinical trials and engage with our third-party vendors and thereby have a material adverse effect on our financial results.

Our Growth Strategies

We will strive to grow our business by pursuing the following key growth strategies:

Commercialize DuraGraft and related products. Continue (i) the distribution of DuraGraft, in Europe and other countries that accept the CE marking and (ii) the development, regulatory approval and commercialization of DuraGraft in the United States. Having received FDA authorization for marketing of DuraGraft, we are proceeding with our plans to commercialize DuraGraft in the United States and continue to generate international revenue growth from sales of DuraGraft
Develop MAR-FG-001 fat grafting technology and products. Continue with the development of MAR-FG-001 to validate its protective abilities and its improvements to the retention of fa

The strategic plans described above will require capital. There can be no assurances that we will be able to raise the capital that we need to execute our plans or that capital, whether through securities offerings, either private or public, or other sources, will be available to us on acceptable terms, if at all. An inability to raise sufficient funds could cause us to scale back our development and growth plans or discontinue them altogether.

Impact of COVID-19 Pandemic

The Company has been impacted by the COVID-19 pandemic and related supply chain shortages and other economic conditions, and some of its earlier plans to diversify and expand its operations were delayed as a result. Moreover, the impact of the COVID-19 pandemic on the Company’s supply chain and its ability to produce DuraGraft inventory was a primary reason that we did not generate substantial revenue from sales of DuraGraft during 2021 and 2022. The Company’s inventory production of DuraGraft returned to its pre-pandemic level at the end of the second quarter of 2022, but lingering effects of the COVID-19 pandemic continued to depress demand for DuraGraft and cause revenues from DuraGraft during the first and second quarters of 2023 to be minimal. There can be no assurance that future supply chain disruptions and other effects of COVID-19 outbreaks will not adversely impact our revenues.

In addition, the Company is dependent upon certain contract manufacturers and suppliers and their ability to reliably and efficiently fulfill its orders is critical to the Company’s business success. The COVID-19 pandemic has impacted and may continue to impact certain of the Company’s manufacturers and suppliers. As a result, the Company has faced and may continue to face delays or difficulty sourcing certain products, which could negatively affect the Company’s business and financial results.

While it is not possible at this time to estimate the total impact that COVID-19 could have on our business in the future, the continued spread of COVID-19 and variants of the virus, the rate of vaccinations regionally and globally and the measures taken by the government authorities, and any future epidemic disease outbreaks, could: Disrupt the supply chain and the manufacture or shipment of products and supplies for use by us in our research activities and by strategic partners for their distribution and sales activities; delay, limit or prevent us in our research activities and strategic partners in their distribution and sales activities; impede our negotiations with strategic partners; impede testing, monitoring, data collection and analysis and other related activities by us; interrupt or delay the operations of the FDA or other regulatory authorities, which may impact review and approval timelines for initiation of clinical trials or marketing; or impede the launch or commercialization of any approved products; any of which could delay our strategic partnership plans, increase our operating costs, and have a material adverse effect on our business, financial condition and results of operations.

For a further discussion of the potential impact of the COVID-19 pandemic on our business, please see “Item 1A. Risk Factors – Risks Related to Our Business – The COVID-19 pandemic has adversely impacted the Company’s supply chain and could materially and adversely affect our ability to conduct clinical trials and engage with our third-party vendors and thereby have a material adverse effect on our financial results.

Corporate Information

Our principal executive office is located at 555 Heritage Drive, Suite 205, Jupiter, Florida 33458 and our telephone number is (561) 935-9955. We maintain a website at www.marizyme.com. Information available on this website is not incorporated by reference in and is not deemed a part of this report. Our filings with the SEC are available for inspection through the SEC’s website at http://www.sec.gov.

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Competition

Competition in the medical device and life science industries is intense. Our competitors include pharmaceutical companies and biotechnology companies, as well as universities and public and private research institutions. In addition, companies that are active in different but related fields represent substantial competition for us. Many of our competitors have significantly greater capital resources, larger research and development staffs and facilities and greater experience in medical device development, regulation, manufacturing and marketing than we do. These organizations also compete with us to recruit qualified personnel, attract partners for joint ventures or other collaborations, and license technologies that are competitive with ours. To compete successfully in this industry, we must identify novel and unique medical devices or methods of treatment and then complete the development of those medical devices as treatments.

The medical devices that we are attempting to develop will have to compete with existing therapies. In addition, a large number of companies are pursuing the development of medical devices that target the same conditions that we are targeting, and other companies have existing products or medical devices in various stages of pre-clinical or clinical development.

Intellectual Property

Patents, Trademarks, Franchises, Concessions, Royalty Agreements, or Labor Contracts

We own, through the acquisitions of MATLOC, Krillase, DuraGraft, and other assets, various patents, trademarks and other intangibles.

Patent Portfolio

Upon our acquisition of the Somahlution Assets, we acquired all of the Somahlution intellectual property relating to the Somahlution products, including patents rights and trademarks relating to DuraGraft. In addition, prior to the closing of the acquisition of the Somahlution Assets, in certain countries, we paid the costs relating to the filing and registration of patent applications and we were granted ownership rights to DuraGraft patents issued in those countries.

As a result of the My Health Logic acquisition, we received the exclusive patent rights to all of My Health Logic’s intellectual property, including patents rights and trademarks relating to the MATLOC platform and products.

Upon the acquisition of the Krillase platform assets from ACB Holding AB, a Swedish corporation, we acquired patents and patent applications relating to the Krillase technology.

As of May 13, 2024, we own the following patents:

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As of May 13, 2024, we are the licensee of the following patents: