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As filed with the Securities and Exchange Commission on October 10, 2019

Registration No. 333-233588


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



Amendment No. 1 to
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933



GEMPHIRE THERAPEUTICS INC.
(Exact name of Registrant as specified in its charter)



Delaware
(State or other jurisdiction of
incorporation or organization)
  2834
(Primary Standard Industrial
Classification Code Number)
  47-2389984
(I.R.S. Employer
Identification Number)

P.O. Box 130235
Ann Arbor, MI 48113
(734) 245-1700

(Address including zip code, and telephone number, including area code, of Registrant's principal executive offices)

Steven Gullans, Ph.D.
President & Chief Executive Officer
Gemphire Therapeutics Inc.
P.O. Box 130235
Ann Arbor, MI 48113
(734) 245-1700

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Phillip D. Torrence
Honigman LLP
650 Trade Centre Way, Suite 200
Kalamazoo, MI 49002-0402
(269) 337-7700

 

John L. Brooks, III
President & Chief Executive Officer
NeuroBo Pharmaceuticals, Inc.
177 Huntington Avenue, Suite 1700
Boston, MA 02115
(617) 313-7331

 

Megan N. Gates
Marc D. Mantell
Melanie Ruthrauff Levy
Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
One Financial Center
Boston, MA 02111
(617) 542-6000



Approximate date of commencement of proposed sale of the securities to the public:
As soon as practicable after the effectiveness of this registration statement and the satisfaction or waiver of all other conditions under the Merger Agreement described herein.

           If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, please check the following box.    o

           If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

           If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

           Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o   Accelerated filer ý   Non-accelerated filer o   Smaller reporting company ý

Emerging growth company ý

           If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ý

           If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

           Exchange Act Rule 13(e)-4(i) (Cross-Border Issuer Tender Offer) o

           Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) o

CALCULATION OF REGISTRATION FEE

               
 
Title of Each Class of Security
Being Registered

  Amount to be
Registered(1)

  Proposed Maximum
Offering Price Per
Share

  Proposed Maximum
Aggregate Offering
Price(2)

  Amount of
Registration Fee(3)

 

Common stock, $0.001 par value per share

  375,408,770   N/A   $465.14   $1.00

 

(1)
Represents the maximum number of shares of common stock, $0.001 par value per share ("Gemphire common stock"), of Gemphire Therapeutics Inc., a Delaware corporation ("Gemphire"), issuable to holders of common stock, $0.0001 par value per share ("NeuroBo common stock"), and options of NeuroBo Pharmaceuticals, Inc., a Delaware corporation ("NeuroBo"), in the proposed merger of GR Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of Gemphire, with and into NeuroBo (the "merger"). The amount of Gemphire common stock to be registered is based on the estimated number of shares of Gemphire common stock that are expected to be issued pursuant to the merger, assuming an exchange ratio of 26.9029 shares of Gemphire common stock for each share of NeuroBo common stock and for each option exercisable for shares of NeuroBo capital stock, without giving effect to a reverse stock split of Gemphire common stock expected to be completed immediately prior to the merger.

(2)
Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(f)(2) of the Securities Act of 1933, as amended. NeuroBo is a private company, no market exists for its securities, and NeuroBo has an accumulated capital deficit. Therefore, the proposed maximum aggregate offering price is one-third of the aggregate par value of the NeuroBo securities expected to be exchanged in the proposed merger.

(3)
This fee has been calculated pursuant to Section 6(b) of the Securities Act of 1933, as amended, and has been rounded up to $1.00. Gemphire previously paid this amount.




           The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment that specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

   


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The information in this proxy statement/prospectus/information statement is not complete and may be changed. Gemphire may not sell its securities pursuant to the proposed transactions until the Registration Statement filed with the Securities and Exchange Commission is effective. This proxy statement/prospectus/information statement is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to completion, dated October 10, 2019

LOGO   LOGO

PROPOSED MERGER
YOUR VOTE IS VERY IMPORTANT

             To the Stockholders of Gemphire Therapeutics Inc. and NeuroBo Pharmaceuticals, Inc.:

             Gemphire Therapeutics Inc. ("Gemphire") and NeuroBo Pharmaceuticals, Inc. ("NeuroBo") have entered into an Agreement and Plan of Merger and Reorganization (the "Merger Agreement") pursuant to which a wholly-owned subsidiary of Gemphire will merge with and into NeuroBo, with NeuroBo surviving as a wholly-owned subsidiary of Gemphire (the "merger").

             At the effective time of the merger (the "Effective Time"), each share of common stock of NeuroBo, $0.0001 par value per share ("NeuroBo common stock"), will be converted into the right to receive approximately 26.9029 shares of Gemphire common stock, $0.001 par value per share ("Gemphire common stock") subject to adjustment for the reverse stock split of Gemphire common stock to be implemented prior to the consummation of the merger as discussed in this proxy statement/prospectus/information statement (the "Exchange Ratio"). This Exchange Ratio is an estimate only as of the date hereof and the final exchange ratio will be determined pursuant to a formula described in more detail in the Merger Agreement and in the section entitled "The Merger—Merger Consideration and Exchange Ratio" beginning on page 179 of this proxy statement/prospectus/information statement. Immediately prior to the Effective Time, each share of preferred stock, $0.0001 par value per share, of NeuroBo ("NeuroBo preferred stock" and, together with the NeuroBo common stock, "NeuroBo capital stock"), will be converted into one share of NeuroBo common stock in accordance with the applicable provisions of NeuroBo's certificate of incorporation, and all of NeuroBo's outstanding convertible notes will convert into NeuroBo common stock. Gemphire will assume outstanding and unexercised options to purchase shares of NeuroBo capital stock, and in connection with the merger they will be converted into options to purchase shares of Gemphire common stock. At the Effective Time, Gemphire stockholders will continue to own and hold their existing shares of Gemphire common stock subject to the reverse stock split of Gemphire common stock to be implemented prior to the consummation of the merger, and all outstanding and unexercised warrants to purchase shares of Gemphire common stock immediately prior to the Effective Time will remain in effect pursuant to their terms. Each existing unexpired and unexercised option to purchase Gemphire common stock (a "Gemphire Option"), whether vested or unvested, will be accelerated in full pursuant to the Merger Agreement effective as of immediately prior to the Effective Time. Any Gemphire Options having an exercise price per share less than the volume weighted average closing trading price of a share of Gemphire common stock on Nasdaq for the five consecutive trading days ending five trading days immediately prior to the date upon which the merger becomes effective (the "Gemphire Closing Price") will be automatically exercised. Gemphire Options having an exercise price per share greater than the Gemphire Closing Price will be terminated and cease to exist as of immediately prior to the Effective Time for no consideration.

             Immediately following the consummation of the merger, NeuroBo securityholders are expected to own, or hold rights to acquire, approximately 95.94% of the Gemphire common stock, and Gemphire securityholders are expected to own, or hold rights to acquire, approximately 4.06% of the Gemphire common stock on a fully-diluted basis, subject to adjustment of the Exchange Ratio as set forth in the Merger Agreement.

             Shares of Gemphire common stock are currently listed on the Nasdaq Capital Market under the symbol "GEMP." Gemphire has filed an initial listing application for the combined company with the Nasdaq Capital Market. After completion of the merger, Gemphire will be renamed "NeuroBo Pharmaceuticals, Inc." and expects to trade under the symbol "NRBO". On                        , 2019, the last trading day before the date of this proxy statement/prospectus/information statement, the closing sale price of Gemphire common stock was $            per share.

             Gemphire is holding its 2019 annual meeting of its stockholders (the "Gemphire annual meeting") in order to obtain the stockholder approvals necessary to complete the merger and related matters, hold an election of directors and ratify the selection of an independent registered public accounting firm. At the Gemphire annual meeting, which will be held at                        , Eastern time, on                        , 2019 at                        , unless postponed or adjourned to a later date, Gemphire will ask its stockholders to, among other things:

             As described in this proxy statement/prospectus/information statement, certain of NeuroBo's stockholders who in the aggregate own approximately 90% of the outstanding shares of NeuroBo common stock on an as converted to common stock basis, and certain of Gemphire's stockholders who in the aggregate own approximately 26% of the outstanding shares of Gemphire common stock, are parties to voting agreements with Gemphire and NeuroBo, whereby such stockholders have agreed to vote their shares in favor of the adoption or approval of certain proposals described in this proxy statement/prospectus/information statement, subject to the terms of the voting agreements.

             In addition, following the registration statement on Form S-4, of which this proxy statement/prospectus/information statement is a part, being declared effective by the U.S. Securities and Exchange Commission (the "SEC") and pursuant to the conditions of the Merger Agreement and the voting agreements, NeuroBo securityholders who are party to the voting agreements will each execute an action by written consent of NeuroBo securityholders (the "written consent") adopting the Merger Agreement, thereby approving the transactions contemplated therein, including the merger. These securityholders hold a sufficient number of shares of NeuroBo capital stock to adopt the Merger Agreement, and no meeting of NeuroBo securityholders to adopt the Merger Agreement and approve the merger and related transactions will be held. All NeuroBo stockholders will have the opportunity to elect to adopt the Merger Agreement, thereby approving the merger and related transactions, by signing and returning to NeuroBo a written consent.

             After careful consideration, the Gemphire Board has approved the Merger Agreement and the respective proposals described in this proxy statement/prospectus/information statement and determined that the merger and all related transactions contemplated by the Merger Agreement are fair to, advisable and in the best interests of Gemphire and its stockholders. The Gemphire Board recommends that Gemphire's stockholders vote "FOR" the proposals described in this proxy statement/prospectus/information statement.

             After careful consideration, NeuroBo's board of directors (the "NeuroBo Board") has (i) determined that the merger and all related transactions contemplated by the Merger Agreement are fair to, advisable and in the best interests of NeuroBo and its stockholders, (ii) approved and declared advisable the Merger Agreement and the transactions contemplated therein and (iii) determined to recommend, upon the terms and subject to the conditions set forth in the Merger Agreement, that its stockholders vote to approve the Merger Agreement and the transactions contemplated thereby. The NeuroBo Board recommends that NeuroBo's stockholders sign and return the written consent, indicating their (i) adoption and approval of the Merger Agreement and the transactions contemplated thereby, (ii) acknowledgement that the approval given is irrevocable and that such stockholder is aware of its rights to demand appraisal for its shares pursuant to Section 262 of the General Corporation Law of the State of Delaware ("DGCL"), and that such stockholder has received and read a copy of Section 262 of the DGCL and (iii) acknowledgement that by its approval of the merger it is not entitled to appraisal rights with respect to its shares in connection with the merger and thereby waives any rights to receive payment of the fair value of its capital stock under the DGCL.

             More information about Gemphire, NeuroBo and the merger is contained in this proxy statement/prospectus/information statement. Gemphire and NeuroBo urge you to read this proxy statement/prospectus/information statement carefully and in its entirety. IN PARTICULAR, YOU SHOULD CAREFULLY CONSIDER THE MATTERS DISCUSSED UNDER "RISK FACTORS" BEGINNING ON PAGE 30.

             Gemphire and NeuroBo are excited about the opportunities the merger brings to both Gemphire's and NeuroBo's stockholders, and thank you for your consideration and continued support.

Steven Gullans, Ph.D.   John L. Brooks, III
President & Chief Executive Officer   President & Chief Executive Officer
Gemphire Therapeutics Inc.   NeuroBo Pharmaceuticals, Inc.

             Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this proxy statement/prospectus/information statement. Any representation to the contrary is a criminal offense.

             The accompanying proxy statement/prospectus/information statement is dated                        , 2019, and is first being mailed to Gemphire's and NeuroBo's stockholders on or about                         , 2019.


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LOGO

GEMPHIRE THERAPEUTICS INC.
P.O. Box 130235
Ann Arbor, MI 48113
(734) 245-1700
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON                        , 2019

Dear Stockholders of Gemphire:

        On behalf of the board of directors (the "Gemphire Board") of Gemphire Therapeutics Inc., a Delaware corporation ("Gemphire"), we are pleased to deliver this proxy statement/prospectus/information statement for the 2019 annual meeting of stockholders of Gemphire and for the proposed merger (the "merger") between Gemphire and NeuroBo Pharmaceuticals, Inc., a Delaware corporation ("NeuroBo"), pursuant to which GR Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of Gemphire ("Merger Sub"), will merge with and into NeuroBo, with NeuroBo surviving as a wholly-owned subsidiary of Gemphire. The annual meeting of stockholders of Gemphire will be held on                        , 2019 at         , Eastern time, at                         for the following purposes:


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        The Gemphire Board has fixed                        , 2019, as the record date for the determination of stockholders entitled to notice of, and to vote at, the Gemphire annual meeting and any adjournment or postponement thereof (the "Record Date"). Only holders of record of shares of Gemphire common stock at the close of business on the Record Date are entitled to notice of, and to vote at, the Gemphire annual meeting. At the close of business on the Record Date, Gemphire had            shares of common stock outstanding and entitled to vote.

        Your vote is important. The affirmative vote of the holders of a majority of the shares of Gemphire common stock present in person or represented by proxy at the Gemphire annual meeting and entitled to vote on the matter is required for approval of Proposal Nos. 1, 4, 6 and 7. The affirmative vote of the holders of a majority of the shares of Gemphire common stock outstanding on the Record Date for the Gemphire annual meeting and entitled to vote on the matter is required for approval of Proposal Nos. 2 and 3. Directors will be elected by a plurality of the votes of shares present in person or represented by proxy at the Gemphire annual meeting and entitled to vote on the election of directors.

        Proposal No. 1 is conditioned upon the approval of Proposal No. 2, and the merger cannot be consummated without the approval of Proposal Nos. 1 and 2. Proposal Nos. 3 and 4 are conditioned upon the consummation of the merger. If the merger is not completed or the stockholders do not approve Proposal No. 3, Gemphire will not change its name to "NeuroBo Pharmaceuticals, Inc." If the merger is not completed or the stockholders do not approve Proposal No. 4, the Gemphire Therapeutics Inc. 2019 Equity Incentive Plan will not become effective. Proposal No. 1 is not conditioned on Proposal No. 3 or Proposal No. 4 being approved, and Proposals No. 2, 5 and 6 are not conditioned on any other proposal.

        Even if you plan to attend the Gemphire annual meeting in person, Gemphire requests that you sign and return the enclosed proxy to ensure that your shares will be represented at the Gemphire annual meeting if you are unable to attend.

        THE GEMPHIRE BOARD HAS DETERMINED AND BELIEVES THAT EACH OF THE PROPOSALS OUTLINED ABOVE IS ADVISABLE TO, AND IN THE BEST INTERESTS OF, GEMPHIRE AND ITS STOCKHOLDERS AND HAS APPROVED EACH SUCH PROPOSAL. THE GEMPHIRE BOARD RECOMMENDS THAT GEMPHIRE STOCKHOLDERS VOTE "FOR" EACH SUCH PROPOSAL.

By Order of the Gemphire Board of Directors,

Steven Gullans, Ph.D.
President and Chief Executive Officer
Ann Arbor, Michigan

                        , 2019


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REFERENCES TO ADDITIONAL INFORMATION

        This proxy statement/prospectus/information statement incorporates important business and financial information about Gemphire that is not included in or delivered with this document. You may obtain this information without charge through the SEC's website (http://www.sec.gov) or upon your written or oral request by contacting the Secretary of Gemphire Therapeutics Inc., P.O. Box 130235, Ann Arbor, MI 48113 or by calling (734) 245-1700.

        To ensure timely delivery of these documents, any request should be made no later than                        , 2019 to receive them before the Gemphire annual meeting.

        For additional details about where you can find information about Gemphire, please see the section entitled "Where You Can Find More Information" in this proxy statement/prospectus/information statement.


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TABLE OF CONTENTS

QUESTIONS AND ANSWERS ABOUT THE MERGER

    1  

PROSPECTUS SUMMARY

   
12
 

The Companies

    12  

The Merger

    12  

Reasons for the Merger

    13  

Opinion of the Gemphire Financial Advisor

    14  

Material U.S. Federal Income Tax Consequences of the Merger

    15  

Material U.S. Federal Income Tax Consequences of Receipt of CVRs and the Gemphire Reverse Stock Split

    15  

Overview of the Merger Agreement

    16  

CVR Agreement

    18  

Voting Agreements and Written Consents

    18  

Nasdaq Stock Market Listing

    18  

Lock-up Agreements

    19  

Management Following the Merger

    19  

Interests of Certain Directors and Officers of Gemphire and NeuroBo

    19  

Risk Factors

    20  

Regulatory Approvals

    21  

Anticipated Accounting Treatment

    21  

Appraisal Rights and Dissenters' Rights

    22  

Comparison of Stockholder Rights

    22  

SELECTED HISTORICAL AND UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL DATA

   
23
 

Selected Historical Financial Data of Gemphire

    23  

Selected Historical Financial Data of NeuroBo

    25  

Selected Unaudited Pro Forma Condensed Combined Financial Data of Gemphire and NeuroBo

    26  

Comparative Historical and Unaudited Pro Forma Per Share Data

    27  

MARKET PRICE AND DIVIDEND INFORMATION

   
29
 

RISK FACTORS

   
30
 

Risks Related to the Merger

    30  

Risks Related to the Proposed Reverse Stock Split

    35  

Risks Related to Gemphire

    36  

Risks Related to Gemphire's Financial Condition and Gemphire's Need for Additional Financing, and Additional Risks Related to the Merger

    36  

Risks Related to the Development of Gemcabene or Any Future Product Candidate

    41  

Risks Related to Government Regulation

    50  

Risks Related to the Commercialization of Gemcabene or Any Future Product Candidate

    58  

Risks Related to its Dependence on Third Parties

    65  

Risks Related to Gemphire's Intellectual Property

    69  

Risks Related to Gemphire's Operations, Employee Matters and Managing Growth

    78  

Risks Related to Gemphire Common Stock

    81  

Risks Related to NeuroBo

    90  

Risks Related to NeuroBo's Financial Position and Need for Additional Capital

    90  

Risks Related to Development and Commercialization of NeuroBo's Product Candidates

    97  

Risks Related to the Marketing and Commercialization of NeuroBo's Product Candidates

    105  

Risks Related to NeuroBo's Dependence on Third Parties

    114  

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Risks Related to NeuroBo's Intellectual Property

    119  

Risks Related to Regulatory Approval of NeuroBo's Product Candidates and Other Legal and Compliance Matters

    127  

Risks Related to NeuroBo's Business Operations, Employee Matters and Managing Growth

    130  

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

   
134
 

THE ANNUAL MEETING OF GEMPHIRE STOCKHOLDERS

   
137
 

Date, Time and Place

    137  

Purposes of the Gemphire Annual Meeting

    137  

Recommendation of the Gemphire Board

    137  

Record Date and Voting Power

    138  

Voting and Revocation of Proxies

    139  

Required Vote

    140  

Solicitation of Proxies

    141  

Other Matters

    141  

THE MERGER

   
142
 

Background of the Merger

    142  

Gemphire Reasons for the Merger

    155  

NeuroBo Reasons for the Merger

    159  

Opinion of the Gemphire Financial Advisor

    161  

Financial Projections

    170  

Interests of Gemphire Directors and Executive Officers in the Merger

    172  

Interests of NeuroBo Directors and Executive Officers in the Merger

    177  

Limitation of Liability and Indemnification

    179  

Form of the Merger

    180  

Merger Consideration and Exchange Ratio

    180  

Procedure for Exchanging NeuroBo Stock Certificates

    182  

Determination of Gemphire's Parent Cash Amount

    183  

Effective Time of the Merger

    183  

Regulatory Approvals

    183  

Intended Tax Treatment of the Merger

    184  

Material U.S. Federal Income Tax Consequences of the Merger

    184  

Nasdaq Listing

    188  

Anticipated Accounting Treatment

    188  

Appraisal Rights and Dissenters' Rights

    189  

THE MERGER AGREEMENT

   
193
 

General

    193  

Merger Consideration

    193  

Treatment of Gemphire Options and Warrants

    193  

Treatment of NeuroBo Options

    194  

Directors and Officers of Gemphire Following the Merger

    194  

Amendments to the Gemphire Certificate of Incorporation

    195  

Conditions to the Completion of the Merger

    195  

Representations and Warranties

    198  

No Solicitation

    199  

Meetings of Gemphire Stockholders; Consent of NeuroBo Stockholders

    201  

Covenants; Conduct of Business Pending the Merger

    201  

Other Agreements

    204  

Termination

    205  

Termination Fee

    207  

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Amendment

    208  

AGREEMENTS RELATED TO THE MERGER

   
209
 

Contingent Value Rights Agreement

    209  

Voting Agreements and Written Consents

    213  

Lock Up Agreements

    215  

NeuroBo Preferred Stock Conversion

    216  

NeuroBo Convertible Note Conversion

    216  

NeuroBo Stock Split

    216  

GEMPHIRE DIRECTORS, OFFICERS AND CORPORATE GOVERNANCE

   
217
 

Business Experience and Background of Directors and Executive Officers of Gemphire

    217  

Gemphire Governance Matters

    219  

Non-Employee Director Compensation

    224  

REPORT OF THE GEMPHIRE AUDIT COMMITTEE

   
226
 

GEMPHIRE EXECUTIVE COMPENSATION

   
227
 

Gemphire Summary Compensation Table for 2017 and 2018

    227  

Narrative Disclosure to Gemphire Summary Compensation Table

    228  

Gemphire Outstanding Equity Awards at December 31, 2018

    232  

Gemphire Potential Payments Upon Termination or Change in Control

    233  

NEUROBO EXECUTIVE COMPENSATION

   
238
 

NeuroBo Summary Compensation Table for 2017 and 2018

    238  

Narrative Disclosure to NeuroBo Summary Compensation Table

    239  

NeuroBo Outstanding Equity Awards at December 31, 2018

    242  

Potential Payments Upon Termination of Employment or Change in Control

    242  

Employment Benefit Plans

    242  

Compensation Risk Management

    244  

Health and Welfare Benefits

    244  

MATTERS BEING SUBMITTED TO A VOTE OF GEMPHIRE STOCKHOLDERS

   
245
 

Proposal No. 1: Approval of the Issuance of Gemphire Common Stock to NeuroBo Stockholders pursuant to the Merger Agreement and the Change of Control of Gemphire Resulting from the Merger

    245  

Proposal No. 2: Approval of an Amendment to the Gemphire Certificate of Incorporation Effecting the Gemphire Reverse Stock Split

    246  

Proposal No. 3: Approval of Gemphire Name Change

    253  

Proposal No. 4: Approval of the Adoption of the Gemphire 2019 Plan

    254  

Proposal No. 5: Election of Directors

    261  

Proposal No. 6: Ratification of Appointment of Independent Registered Public Accounting Firm

    261  

Proposal No. 7: Approval of Possible Adjournment of the Gemphire Annual Meeting

    263  

GEMPHIRE BUSINESS

   
265
 

Overview

    265  

Historical Development Plan for Gemcabene

    267  

Gemphire's Drug Product Candidate, Gemcabene

    267  

Gemcabene's Mechanism of Action

    268  

Clinical Experience with Gemcabene

    268  

Non-Company Sponsored Phase 2 Human Trials

    273  

Gemcabene Phase 1 Clinical Trials

    273  

Gemcabene Preclinical Studies

    274  

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Overview of Dyslipidemia Markets

    275  

Potential Orphan Indications

    276  

Potential Broader Indications

    277  

Cardiovascular Outcomes Trials

    278  

Gemcabene Chemistry, Manufacturing and Controls (CMC)

    278  

Pfizer License Agreement Related to Gemcabene

    279  

License Agreement with Beijing SL

    280  

Intellectual Property

    281  

Competition

    283  

Government Regulation

    285  

Employees

    297  

Corporate Information

    298  

Available Information

    298  

Properties

    298  

Legal Proceedings

    298  

NEUROBO BUSINESS

   
299
 

Overview

    299  

NeuroBo's Product Candidates

    300  

Strategy

    301  

NeuroBo's Novel Approach to Neurodegenerative Diseases

    301  

License Agreement

    305  

Competition

    307  

Intellectual Property

    308  

Manufacturing

    309  

Government Regulation and Approval

    310  

Employees

    324  

Facilities

    324  

Legal Proceedings

    324  

GEMPHIRE MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

   
325
 

Overview

    325  

Key Developments

    326  

Financial Operations Overview

    329  

Results of Operations

    331  

Critical Accounting Policies and Estimates

    342  

Off-Balance Sheet Arrangements

    342  

Recent Accounting Pronouncements

    342  

NEUROBO MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

   
343
 

Overview

    343  

Components of Results of Operations

    345  

Results of Operations

    349  

Liquidity and Capital Resources

    352  

Contractual Obligations and Commitments

    356  

Critical Accounting Policies and Significant Judgments and Estimates

    357  

Emerging Growth Company Status

    359  

Off-Balance Sheet Arrangements

    360  

Recently Issued Accounting Pronouncements

    360  

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MANAGEMENT FOLLOWING THE MERGER

    361  

Executive Officers and Directors

    361  

Composition of the Board of Directors Following the Merger

    364  

Director Independence

    364  

Committees of the Board of Directors Following the Merger

    365  

Director Compensation

    366  

RELATED PARTY TRANSACTIONS OF DIRECTORS AND EXECUTIVE OFFICERS OF THE COMBINED ORGANIZATION

   
367
 

Gemphire Transactions

    367  

NeuroBo Transactions

    369  

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

   
372
 

Unaudited Pro Forma Condensed Combined Balance Sheet

    374  

Unaudited Pro Forma Condensed Combined Statements of Operations

    375  

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

   
377
 

DESCRIPTION OF GEMPHIRE CAPITAL STOCK

   
384
 

General

    384  

Common Stock

    384  

Listing

    384  

Transfer Agent and Registrar

    384  

Preferred Stock

    385  

Options

    385  

Warrants

    385  

Registration Rights

    385  

Anti-Takeover Provisions

    387  

COMPARISON OF RIGHTS OF HOLDERS OF GEMPHIRE STOCK AND NEUROBO STOCK

   
389
 

Current NeuroBo Rights Versus Post-Merger Gemphire Rights

    389  

PRINCIPAL STOCKHOLDERS OF GEMPHIRE

   
403
 

PRINCIPAL STOCKHOLDERS OF NEUROBO

   
406
 

PRINCIPAL STOCKHOLDERS OF COMBINED ORGANIZATION

   
408
 

LEGAL MATTERS

   
410
 

EXPERTS

   
410
 

WHERE YOU CAN FIND MORE INFORMATION

   
410
 

TRADEMARK NOTICE

   
411
 

OTHER MATTERS

   
412
 

Stockholder Proposals

    412  

Communications with the Gemphire Board

    413  

Available Information

    413  

"Householding"—Stockholders Sharing the Same Address

    413  

INDEX TO GEMPHIRE FINANCIAL STATEMENTS

   
F-1
 

INDEX TO NEUROBO FINANCIAL STATEMENTS

   
F-59
 

ANNEX A—AGREEMENT AND PLAN OF MERGER AND REORGANIZATION

   
A-1
 

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ANNEX B—CERTIFICATE OF AMENDMENT FOR THE GEMPHIRE REVERSE STOCK SPLIT

    B-1  

ANNEX C—CERTIFICATE OF AMENDMENT FOR THE GEMPHIRE NAME CHANGE

   
C-1
 

ANNEX D—2019 EQUITY INCENTIVE PLAN

   
D-1
 

ANNEX E—OPINION OF LADENBURG THALMANN & CO. INC. 

   
E-1
 

ANNEX F—SECTION 262 OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE

   
F-1
 

        References to "Gemphire" and "NeuroBo" in this proxy statement/prospectus/information statement refer to Gemphire Therapeutics Inc. and NeuroBo Pharmaceuticals, Inc., respectively. References to the "combined company" refer to Gemphire and its wholly owned subsidiary, NeuroBo, after the merger. Except as otherwise noted, references to "we," "us" or "our" refer to both Gemphire and NeuroBo. References to "Merger Sub" refer to GR Merger Sub Inc., a newly formed, wholly-owned subsidiary of Gemphire.

        References to the "Merger Agreement" refer to that certain agreement and plan of merger dated as of July 24, 2019 among Gemphire, Merger Sub and NeuroBo, as amended from time to time. References to the "merger" refer to the merger of Merger Sub with and into NeuroBo, with NeuroBo surviving as the surviving entity and as a wholly owned subsidiary of Gemphire as contemplated under the Merger Agreement.

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QUESTIONS AND ANSWERS ABOUT THE MERGER

        Except where specifically noted, the following information and all other information contained in this proxy statement/prospectus/information statement gives effect to NeuroBo's 10,000-for-1 split of its common stock and preferred stock, which was effective on August 13, 2019, but does not give effect to the proposed reverse stock split described in the section entitled "Matters Being Submitted to a Vote of Gemphire Stockholders—Proposal No. 2: Approval of an Amendment to the Gemphire Certificate of Incorporation Effecting the Gemphire Reverse Stock Split" in this proxy statement/prospectus/information statement (the "Gemphire Reverse Stock Split").

        The following section provides answers to frequently asked questions about the merger. This section, however, provides only summary information. For a more complete response to these questions and for additional information, please refer to the cross-referenced sections.

Q:
What is the merger?

A:
Gemphire, Merger Sub and NeuroBo have entered into the Merger Agreement, which contains the terms and conditions of the proposed business combination of Gemphire and NeuroBo. Under the Merger Agreement, Merger Sub will merge with and into NeuroBo, with NeuroBo surviving as a wholly owned subsidiary of Gemphire (the "merger").

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Q:
What will happen to Gemphire if, for any reason, the merger does not close?

A:
If, for any reason, the merger does not close, the Gemphire board of directors (the "Gemphire Board") may elect to dissolve and liquidate its assets. If Gemphire were able to secure additional capital to provide it with necessary financial resources, it may alternatively attempt to pursue another strategic transaction like the merger, sell or otherwise dispose of its assets or continue to operate its business. Gemphire expects that it would be difficult to secure financing in a timely manner, on favorable terms or at all. If Gemphire decides to dissolve and liquidate its assets, Gemphire would be required to pay all of its debts and contractual obligations, and to set aside certain reserves for potential future claims, and there can be no assurances as to the amount or timing of available cash left, if any, to distribute to stockholders after paying the debts and other obligations of Gemphire and setting aside funds for reserves.

Q:
Why are the two companies proposing to merge?

A:
NeuroBo and Gemphire believe that the merger will result in a clinical-stage biotechnology company focused on novel, disease-modifying therapies for neurodegenerative diseases. For a discussion of Gemphire's and NeuroBo's reasons for the merger, please see the section entitled "The Merger—Gemphire Reasons for the Merger" and "The Merger—NeuroBo Reasons for the Merger" in this proxy statement/prospectus/information statement.

Q:
Why am I receiving this proxy statement/prospectus/information statement?

A:
You are receiving this proxy statement/prospectus/information statement because you have been identified as a Gemphire Stockholder or a NeuroBo Stockholder as of the applicable record date, and you are entitled, as applicable, to (i) notice of, and to vote at, the Gemphire annual meeting or (ii) sign and return the NeuroBo written consent. This document serves as:

a proxy statement of Gemphire used to solicit proxies for the Gemphire annual meeting;

a prospectus of Gemphire used to offer shares of Gemphire common stock in exchange for shares of NeuroBo common stock in the merger and issuable upon exercise Neurobo Options; and

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Q:
What is required to consummate the merger?

A:
To consummate the merger, Gemphire Stockholders must approve the issuance of Gemphire common stock to NeuroBo Stockholders pursuant to the Merger Agreement and the change of control of Gemphire resulting from the merger under Nasdaq rules (Proposal No. 1) and the Gemphire Reverse Stock Split (Proposal No. 2) and NeuroBo Stockholders must adopt the Merger Agreement, thereby approving the merger and the related transactions, including the Convertible Note Conversion.

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Q:
What proposals are to be voted on at the Gemphire annual meeting, other than the proposals required in connection with the merger?

A:
At the Gemphire annual meeting, the Gemphire Stockholders will also be asked to consider the following proposals, along with any other business that may properly come before the Gemphire annual meeting or any adjournment or postponement thereof:

Proposal No. 3 to approve an amendment to the certificate of incorporation of Gemphire changing the Gemphire corporate name to "NeuroBo Pharmaceuticals, Inc." in the form attached as Annex C;

Proposal No. 4 to approve the Gemphire 2019 Equity Incentive Plan (the "Gemphire 2019 Plan"), a copy of which is attached as Annex D;

Proposal No. 5 to elect two nominees for Class III directors to hold office until the 2022 annual meeting of stockholders and until the election and qualification of his successor, or his earlier death, resignation or removal (provided that, if the merger is completed, the Gemphire Board will be reconstituted as provided in the Merger Agreement);

Proposal No. 6 to ratify the appointment of Ernst & Young LLP as Gemphire's independent registered public accounting firm for the fiscal year ending December 31, 2019 (provided, however, that it is likely that the combined company may decide to engage a new independent registered public accounting firm immediately or shortly after the merger is completed); and

Proposal No. 7 to approve an adjournment of the Gemphire annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal Nos. 1, 2, 3 or 4.
Q:
What stockholder votes are required to approve the proposals required in connection with the merger at the Gemphire annual meeting?
Q:
What will NeuroBo Securityholders receive in the merger?

A:
Gemphire and NeuroBo currently estimate that Exchange Ratio at Closing will be approximately 26.9029, assuming a closing date of November 30, 2019 and that (i) the Parent Cash Amount will be negative $3.0 million as of Closing, (ii) the Pre-Closing Financing amount will be approximately

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Q:
What will Gemphire Stockholders, Gemphire Optionholders and Gemphire Warrant holders receive in the merger?

A:
At the Effective Time, Gemphire Stockholders will continue to own and hold their existing shares of Gemphire common stock.

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Q:
Who will be the directors of Gemphire following the merger?

A:
Following the consummation of the merger, the size of the Gemphire Board will be increased to include a total of six directors. Pursuant to the terms of the Merger Agreement, the Gemphire Board will be reconstituted such that five of the initial post-Closing directors will be designated by NeuroBo, and one initial post-Closing director will be designated by Gemphire. It is currently anticipated that, following the Closing, the Gemphire Board will be constituted as follows, with one additional director to be designated by NeuroBo prior to Closing:
 
Name
  Current Principal Affiliation
  John L. Brooks, III   NeuroBo Pharmaceuticals, Inc., President, Chief Executive Officer and Director

 

Na Yeon (Irene) Kim

 

NeuroBo Pharmaceuticals, Inc., Director

 

Jeong Gyun Oh

 

NeuroBo Pharmaceuticals, Inc., Director

 

Roy Freeman, M.D. 

 

NeuroBo Pharmaceuticals, Inc., Director

 

Steven Gullans, Ph.D. 

 

Gemphire Therapeutics Inc., President, Chief Executive Officer and Director
Q:
Who will be the executive officers of Gemphire immediately following the merger?

A:
Immediately following the consummation of the merger, the executive management team of Gemphire is expected to be composed solely of the members of NeuroBo's executive management team prior to the merger, as follows:
 
Name
  Title
  John L. Brooks, III   President, Chief Executive Officer and Interim Chief Financial Officer

 

Mark Versavel, M.D., Ph.D., M.B.A. 

 

Chief Medical Officer

 

Nandan Padukone, Ph.D., M.B.A. 

 

Senior Vice President, Business Development

 

Nicola Shannon

 

Vice President, Clinical Operations
Q:
What are the material U.S. federal income tax consequences of the merger?

A:
Each of Gemphire and NeuroBo intends to treat the merger to as qualifying as either a tax-free contribution pursuant to Section 351 of the Internal Revenue Code of 1986, as amended (the

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Q:
What are the material U.S. federal income tax consequences of the receipt of CVRs and the Gemphire Reverse Stock Split to Gemphire U.S. Holders?

A:
Gemphire intends to treat the issuance of the CVRs to Gemphire U.S. Holders as a distribution of property with respect to its stock. Please review the information in the section entitled "Agreements Related to the Merger—Contingent Value Rights Agreement—Material U.S. Federal Income Tax Consequences of the Receipt of CVRs" for a more complete description of the material U.S. federal income tax consequences of the receipt of CVRs to Gemphire U.S. Holders, including possible alternative treatments. A Gemphire U.S. Holder generally should not recognize gain or loss upon the Gemphire Reverse Stock Split, except to the extent a Gemphire U.S. Holder receives cash in lieu of a fractional share of Gemphire common stock. Please review the information in the section entitled "Proposal No. 2: Approval of an Amendment to the Gemphire Certificate of Incorporation Effecting the Gemphire Reverse Stock Split—Material U.S. Federal Income Tax Consequences of the Gemphire Reverse Stock Split" for a more complete description of the material U.S. federal income tax consequences of the Gemphire Reverse Stock Split to Gemphire U.S. Holders.
Q:
What is the Pre-Closing Financing?

A:
Prior to signing the Merger Agreement, NeuroBo entered into subscription agreements with investors for a Series B Preferred Stock financing pursuant to which NeuroBo issued and sold 3,030,000 shares of NeuroBo Series B Preferred Stock at a price of $8.00 per share and received approximate gross proceeds of $24,240,000, the minimum required amount under the Merger Agreement. NeuroBo may enter into additional subscription agreements and receive additional proceeds between signing and closing of the merger (the "Pre-Closing Financing"). The securities of NeuroBo issued in the Pre-Closing Financing were or will be issued pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended. Neither the Gemphire Stockholders nor the NeuroBo Stockholders are being asked to vote on the Pre-Closing Financing. Shares of NeuroBo's Series B Preferred Stock that are issued in the Pre-Closing

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Q:
As a Gemphire Stockholder, how does the Gemphire Board recommend that I vote?

A:
After careful consideration, the Gemphire Board recommends that Gemphire Stockholders vote "FOR" all of the proposals described in this proxy statement/prospectus/information statement.

Q:
As a NeuroBo Stockholder, how does the board of directors of NeuroBo (the "NeuroBo Board") recommend that I vote?

A:
After careful consideration, the NeuroBo Board recommends that NeuroBo Stockholders execute the written consent to approve the merger, the Merger Agreement, and the transactions contemplated therein, substantially in accordance with the terms of the Merger Agreement and the other agreements contemplated by the Merger Agreement.

Q:
What risks should I consider in deciding whether to vote in favor of the merger or to execute and return the written consent, as applicable?

A:
You should carefully review the section entitled "Risk Factors" in this proxy statement/prospectus/information statement which sets forth certain risks and uncertainties related to the merger, risks and uncertainties to which the combined organization's business will be subject, and risks and uncertainties to which each of Gemphire and NeuroBo, as independent companies, are subject.

Q:
Who can vote at the Gemphire annual meeting?

A:
Only Gemphire Stockholders of record at the close of business on the Record Date will be entitled to vote at the Gemphire annual meeting. As of                , 2019, there were                shares of Gemphire common stock outstanding and entitled to vote.

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Q:
How many votes do I have?

A:
On each matter to be voted upon, you have one vote for each share of Gemphire common stock you own as of the Record Date.

Q:
What is the quorum requirement?

A:
A quorum of Gemphire Stockholders is necessary to hold a valid meeting. A quorum will be present if Gemphire Stockholders holding at least a majority of the outstanding shares of Gemphire common stock entitled to vote at the Gemphire annual meeting are present in person or represented by proxy at the Gemphire annual meeting. On                2019, there were                shares of Gemphire common stock outstanding and entitled to vote. Accordingly, Gemphire expects that the holders of at least                shares of Gemphire common stock must be present at the Gemphire annual meeting for a quorum to exist. Your shares of Gemphire common stock will be counted toward the quorum at the Gemphire annual meeting only if you attend the Gemphire annual meeting in person or are represented at the Gemphire annual meeting by proxy.
Q:
What are "broker non-votes"?

A:
If you hold shares beneficially in street name and do not provide your broker or other agent with voting instructions, your shares may constitute "broker non-votes." Broker non-votes occur on a matter when banks, brokers and other nominees are not permitted to vote on certain non-discretionary matters without instructions from the beneficial owner and instructions are not given. These matters are referred to as "non-routine" matters. Proposal Nos. 1, 4 and 5 are anticipated to be non-routine matters, and Proposal Nos. 2, 3, 6 and 7 are anticipated to be routine matters. Broker non-votes will have no effect on the outcome of Proposal Nos. 1, 4, and 5.

Q:
When do you expect the merger to be consummated?

A:
Gemphire and NeuroBo anticipate that the merger will occur sometime soon after the Gemphire annual meeting to be held on                , 2019, but the companies cannot predict the exact timing. For more information, please see the section entitled "The Merger Agreement—Conditions to the Completion of the Merger" in this proxy statement/prospectus/information statement.

Q:
What do I need to do now?

A:
Gemphire and NeuroBo urge you to read this proxy statement/prospectus/information statement carefully, including its annexes, and to consider how the merger affects you.

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Q:
What happens if I do not return a proxy card or otherwise provide proxy instructions, as applicable?

A:
If you are a Gemphire Stockholder, the failure to return your proxy card or otherwise provide proxy instructions will have the same effect as voting "AGAINST" Proposal Nos. 2 and 3.

Q:
When and where is the Gemphire annual meeting and may I vote in person?

A:
The Gemphire annual meeting will be held at                , at                , local time, on                , 2019. Subject to space availability, all Gemphire Stockholders as of the Record Date, or their duly appointed proxies, may attend the Gemphire annual meeting. Since seating is limited, admission to the Gemphire annual meeting will be on a first-come, first-served basis. Registration and seating will begin at                , local time. If your shares of Gemphire common stock are registered directly in your name with Gemphire's transfer agent, you are considered to be the stockholder of record with respect to those shares, and the proxy materials and proxy card are being sent directly to you by Gemphire. If you are a stockholder of record, you may attend the Gemphire annual meeting and vote your shares in person. Even if you plan to attend the Gemphire annual meeting in person, Gemphire requests that you sign and return the enclosed proxy to ensure that your shares will be represented at the Gemphire annual meeting if you become unable to attend. If your shares of Gemphire common stock are held in a brokerage account or by another nominee, you are considered the beneficial owner of shares held in "street name," and the proxy materials are being forwarded to you by your broker or other nominee together with a voting instruction card. As the beneficial owner, you are also invited to attend the Gemphire annual meeting. Because a beneficial owner is not the stockholder of record, you may not vote these shares in person at the Gemphire annual meeting unless you obtain a proxy from the broker, trustee or nominee that holds your shares, giving you the right to vote the shares at the Gemphire annual meeting.

Q:
If my Gemphire shares are held in "street name" by my broker, will my broker vote my shares for me?

A:
Unless your broker has discretionary authority to vote on certain matters, your broker will not be able to vote your shares of Gemphire common stock without instructions from you. Brokers are not expected to have discretionary authority to vote for any of the proposals other than Proposal Nos. 2, 3, 6 and 7. To make sure that your vote is counted, you should instruct your broker to vote your shares, following the procedures provided by your broker.

Q:
May I change my vote after I have submitted a proxy or provided proxy instructions?

A:
Gemphire Stockholders of record, other than those Gemphire Stockholders who are parties to voting agreements, may change their vote at any time before their proxy is voted at the Gemphire annual meeting in one of three ways. First, a Gemphire Stockholder of record can send a written notice to the Secretary of Gemphire stating that it would like to revoke its proxy. Second, a Gemphire Stockholder of record can submit new proxy instructions either on a new proxy card or via telephone or the Internet. Third, a Gemphire Stockholder of record can attend the Gemphire annual meeting and vote in person. Attendance alone will not revoke a proxy. If a Gemphire Stockholder who owns shares of Gemphire common stock in "street name" has instructed a broker to vote its shares of Gemphire common stock, the stockholder must follow directions received from its broker to change those instructions.

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Q:
Who is paying for this proxy solicitation?

A:
Gemphire and NeuroBo will share equally the cost of printing and filing this proxy statement/prospectus/information statement and the proxy card. Arrangements will also be made with brokerage firms and other custodians, nominees and fiduciaries who are record holders of Gemphire common stock for the forwarding of solicitation materials to the beneficial owners of Gemphire common stock. Gemphire will reimburse these brokers, custodians, nominees and fiduciaries for the reasonable out-of-pocket expenses they incur in connection with the forwarding of solicitation materials.
Q:
Who can help answer my questions?

A:
If you are a Gemphire Stockholder and would like additional copies, without charge, of this proxy statement/prospectus/information statement or if you have questions about the merger, including the procedures for voting your shares, you should contact:

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PROSPECTUS SUMMARY

        This summary highlights selected information from this proxy statement/prospectus/information statement and may not contain all of the information that is important to you. To better understand the merger, the proposals being considered at the Gemphire annual meeting and NeuroBo's stockholder actions that are the subject of the written consent, you should read this entire proxy statement/prospectus/information statement carefully, including the Merger Agreement attached as Annex A, the opinion of Ladenburg Thalmann & Co. Inc. attached as Annex E and the other annexes to which you are referred herein. For more information, please see the section entitled "Where You Can Find More Information" in this proxy statement/prospectus/information statement.

The Companies

    Gemphire Therapeutics Inc.
    P.O. Box 130235
    Ann Arbor, Michigan 48113
    (734) 245-1700

        Gemphire is a clinical-stage biopharmaceutical company focused on developing and commercializing therapies for the treatment of dyslipidemia, a serious medical condition that increases the risk of life-threatening cardiovascular disease, focused on orphan indications, as well as nonalcoholic fatty liver disease (NAFLD/NASH). Gemphire's product candidate, gemcabene, has been tested as monotherapy and in combination with statins and other drugs in multiple Phase 1 and Phase 2 clinical trials.

    NeuroBo Pharmaceuticals, Inc.
    177 Huntington Avenue, Suite 1700
    Boston, MA 02115
    (617) 313-7331

        NeuroBo is a clinical-stage biotechnology company focused on developing novel pharmaceuticals to treat neurodegenerative disorders affecting millions of patients worldwide. NeuroBo is focused on the development of a treatment for painful diabetic neuropathy (PDN), with its lead product candidate, NB-01, expected to commence Phase 3 clinical development as a first-line pain management therapy for PDN in the first quarter of 2020. NeuroBo believes that NB-01 could also treat a range of neuropathic conditions, including chemotherapy-induced peripheral neuropathy and post-traumatic peripheral neuropathy. NeuroBo's second product candidate, NB-02, has the potential to treat the symptoms of cognitive impairment and modify the clinical progression of neurodegenerative diseases associated with the misfunction of a protein called tau, and with amyloid beta plaque deposition. NB-02 is ready for the submission of an investigational new drug application, or IND, to the Food and Drug Administration, or FDA. NeuroBo believes that leveraging the therapeutic advantages of its pipeline will drive a paradigm shift in the treatment of PDN, peripheral neuropathy and other neurodegenerative diseases.

GR Merger Sub Inc.

        Merger Sub is a wholly-owned subsidiary of Gemphire, formed solely for the purposes of carrying out the merger.

The Merger (see page 142)

        If the merger is completed, Merger Sub will merge with and into NeuroBo, with NeuroBo surviving as a wholly-owned subsidiary of Gemphire.

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        Prior to the Effective Time, the outstanding shares of NeuroBo preferred stock and the outstanding NeuroBo convertible notes will be converted into NeuroBo common stock.

        At the Effective Time, each share of NeuroBo common stock outstanding immediately prior to the Effective Time (excluding certain shares to be canceled pursuant to the Merger Agreement, and shares held by stockholders who have exercised and perfected appraisal rights as more fully described in the section entitled "The Merger—Appraisal Rights and Dissenters' Rights" below) will be converted into the right to receive approximately 26.9029 shares of Gemphire common stock, subject to adjustment for the Gemphire Reverse Stock Split. This Exchange Ratio is an estimate only and the final Exchange Ratio will be determined pursuant to a formula described in more detail in the Merger Agreement and in this proxy statement/prospectus/information statement. Applying an Exchange Ratio of 26.9029, the Gemphire Securityholders immediately prior to the merger are expected to own, or hold rights to acquire, in the aggregate approximately 4.06% of the Fully Diluted Closing Gemphire Common Stock and NeuroBo Securityholders immediately prior to the merger are expected to own, or hold rights to acquire, in the aggregate approximately 95.94% of the Fully Diluted Closing Gemphire Common Stock, in each case, immediately following the merger and assuming Gemphire has the minimum Parent Cash Amount of negative $3 million and that NeuroBo raises the minimum required amount of $24,240,000 in its Pre-Closing Financing. The Exchange Ratio is subject to adjustment as set forth in the Merger Agreement and described herein (and as a result, Gemphire Securityholders and NeuroBo Securityholders could own more or less of the combined organization than currently anticipated).

        For a more complete description of the Exchange Ratio please see the section entitled "The Merger Agreement" in this proxy statement/prospectus/information statement.

        The Closing of the merger will occur no later than the third business day after the last of the conditions to the merger has been satisfied or waived (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of each such condition), or at such other time as Gemphire and NeuroBo agree. Gemphire and NeuroBo anticipate that the consummation of the merger will occur in the second half of the fiscal year. However, because the merger is subject to a number of conditions, neither Gemphire nor NeuroBo can predict exactly when the Closing will occur or if it will occur at all. After completion of the merger, assuming that Gemphire receives the required stockholder approval of Proposal No. 3, Gemphire will be renamed "NeuroBo Pharmaceuticals, Inc."

Reasons for the Merger (see page 155)

        Following the merger, the combined company will be a clinical-stage biotechnology company focused on the development of drug candidates for the treatment of neurodegenerative diseases. Gemphire and NeuroBo believe that the combined organization will have the following potential advantages:

    Phase 3 Ready Lead Product Candidate. NeuroBo is focused on the development of a treatment for painful diabetic neuropathy (PDN), with its lead product candidate, NB-01, expected to commence Phase 3 clinical development as a first-line, disease-modifying therapy in the first quarter of 2020. NeuroBo's second product candidate, NB-02, is in development for the treatment of neurodegenerative diseases associated with the pathological dysfunction of the amyloid-beta and tau proteins in the human brain, which include Alzheimer's disease and tauopathies.

    Management Team. It is expected that the combined organization will be led by the experienced senior management from NeuroBo and a board of directors with representation from each of Gemphire and NeuroBo.

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    Cash Resources. The combined organization is expected to have sufficient cash at the Closing for the combined company to sustain its operations through July 2020 and the combined company's public company structure will provide it with access to the public market to raise additional funds in the future.

        Each of the Gemphire Board and NeuroBo Board also considered other reasons for the merger, as described herein. For example, the Gemphire Board considered, among other things:

    the strategic alternatives to the merger available to Gemphire, including the discussions that Gemphire's management and the Gemphire Board previously conducted with other potential merger partners;

    the risks of continuing to operate Gemphire on a stand-alone basis, including uncertainty regarding the potential results from the preclinical studies, uncertainty regarding the future costs and timeline to support a Phase 3 clinical program of gemcabene, the likelihood of success in conducting a Phase 3 trial and obtaining an NDA, and the need to raise significant additional financing for future clinical and commercial development of gemcabene; and

    the opportunity as a result of the merger for Gemphire Stockholders to participate in the potential growth of the combined company following the merger, while potentially receiving certain cash payments from the grant, sale or transfer of rights to gemcabene during a certain period following the closing of the merger on account of the CVR Agreement to be executed at the Effective Time.

        In addition, the NeuroBo Board approved the merger based on a number of factors, including the following:

    the anticipated cash resources of the combined organization expected to be available following the closing of the merger and the anticipated burn rate of the combined organization;

    the potential to provide NeuroBo's current stockholders with greater liquidity by owning stock in the combined organization, which will be a public company;

    the expectation that the merger with Gemphire would be a more time- and cost-efficient means to access capital than other options considered by and available to NeuroBo, including private placements, venture debt financings and traditional methods of accessing the public markets through an initial public offering of NeuroBo's securities; and

    the broader range of investors potentially available to the combined organization as a public company to support the development of NeuroBo's product candidates, as compared with the investors that NeuroBo could otherwise gain access to if it continued to operate as a privately held company.

Opinion of the Gemphire Financial Advisor (see page 161)

        The Gemphire Board engaged Ladenburg Thalmann & Co. Inc. ("Ladenburg Thalmann") to provide financial advisory services and to consider and evaluate potential strategic transactions on its behalf. Gemphire ultimately requested that Ladenburg Thalmann deliver a fairness opinion with respect to the merger with NeuroBo. On July 23, 2019, at the request of the Gemphire Board, Ladenburg Thalmann rendered the oral opinion, subsequently confirmed by delivery of the written opinion dated July 24, 2019, to the Gemphire Board, that the merger consideration was fair, from a financial point of view, to the Gemphire Stockholders as of the date of such opinion and based upon the various assumptions, qualifications and limitations set forth therein.

        The full text of the written Opinion of Ladenburg Thalmann, dated July 24, 2019 (the "Opinion"), is attached as Annex E to this proxy statement/prospectus/information statement and is incorporated

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herein by reference. Gemphire encourages Gemphire Stockholders to read the Opinion in its entirety for the assumptions made, procedures followed, other matters considered and limits of the review by Ladenburg Thalmann. The summary of the written Opinion of Ladenburg Thalmann set forth herein is qualified by reference to the full text of the Opinion. Ladenburg Thalmann provided its Opinion for the sole benefit and use by the Gemphire Board in its consideration of the merger. The Opinion is not a recommendation to any stockholder as to how to vote with respect to the proposed merger or to take any other action in connection with the merger or otherwise.

Material U.S. Federal Income Tax Consequences of the Merger (see page 184)

        Each of Gemphire and NeuroBo intends to treat the merger as qualifying as either a tax-free contribution pursuant to Section 351 of the Code or a "reorganization" within the meaning of Section 368(a) of the Code. Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. will deliver an opinion to Neurobo that, subject to the Tax Opinion Representations and Assumptions, the merger will qualify as either a tax-free contribution pursuant to Section 351 of the Code or a "reorganization" within the meaning of Section 368(a) of the Code. Assuming the merger qualifies as described above, subject to the limitations and qualifications described in the section entitled "The Merger—Material U.S. Federal Income Tax Consequences of the Merger," a U.S. Holder of NeuroBo common stock generally will not recognize any gain or loss for U.S. federal income tax purposes on the exchange of shares of NeuroBo common stock for shares of Gemphire common stock in the merger, except with respect to cash received by such U.S. Holder of NeuroBo common stock in lieu of a fractional share of Gemphire common stock. If any of the Tax Opinion Representations and Assumptions is incorrect, incomplete or inaccurate or is violated, the accuracy of the opinion described above may be affected and the U.S. federal income tax consequences of the merger could differ from those described in this proxy statement/prospectus/information statement.

        Please review the information in the section entitled "The Merger—Material U.S. Federal Income Tax Consequences of the Merger" for a more complete description of the material U.S. federal income tax consequences of the merger to U.S. Holders of NeuroBo common stock. The tax consequences to you of the merger will depend on your particular facts and circumstances. Please consult your tax advisors as to the specific tax consequences to you of the merger.

Material U.S. Federal Income Tax Consequences of Receipt of CVRs and the Gemphire Reverse Stock Split (see pages 210 and 252)

        Gemphire intends to treat the issuance of CVRs to Gemphire U.S. Holders as a distribution of property with respect to its stock. Please review the information in the section entitled "Agreements Related to the Merger—CVR Agreement—Material U.S. Federal Income Tax Consequences of the Receipt of CVRs" for a more complete description of the material U.S. federal income tax consequences of the receipt of CVRs to Gemphire U.S. Holders, including possible alternative treatments.

        A Gemphire U.S. Holder generally should not recognize gain or loss upon the Gemphire Reverse Stock Split, except to the extent a Gemphire U.S. Holder receives cash in lieu of a fractional share of Gemphire common stock. Please review the information in the section entitled "Proposal No. 2: Approval of an Amendment to the Gemphire Certificate of Incorporation Effecting the Gemphire Reverse Stock Split—Material U.S. Federal Income Tax Consequences of the Gemphire Reverse Stock Split" for a more complete description of the material U.S. federal income tax consequences of the Gemphire Reverse Stock Split to Gemphire U.S. Holders.

        The tax consequences to you of the receipt of CVRs and the Gemphire Reverse Stock Split will depend on your particular facts and circumstances. Please consult your tax advisors as to the specific tax consequences to you.

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Overview of the Merger Agreement

Merger Consideration (see page 193)

        At the Effective Time, each outstanding share of common stock of NeuroBo outstanding immediately prior to the Effective Time (excluding any shares of common stock of NeuroBo held as treasury stock and any dissenting shares) will be converted solely into the right to receive a specified number of shares of Gemphire common stock.

        The Merger Agreement does not provide for an adjustment to the total number of shares of Gemphire common stock that NeuroBo Stockholders will be entitled to receive for changes in the market price of Gemphire common stock. Accordingly, the market value of the shares of Gemphire common stock issued pursuant to the merger will depend on the market value of the shares of Gemphire common stock at the time the merger closes, and could vary significantly from the market value on the date of this proxy statement/prospectus/information statement.

Treatment of Gemphire Options and Warrants (see page 193)

        Prior to the Closing, the Gemphire Board will adopt appropriate resolutions and take all other actions necessary and appropriate to provide that each Gemphire Option, whether vested or unvested, will be accelerated in full effective as of immediately prior to the Effective Time. Effective as of the Effective Time, each outstanding and unexercised Gemphire Option having an exercise price per share less than the Gemphire Closing Price will be automatically exercised in full and, in exchange therefor, each holder of any such automatically exercised Gemphire Options will be entitled to receive a number of shares of Gemphire common stock calculated by dividing (a) the product of (i) the total number of shares of Gemphire common stock previously subject to such Gemphire Option, and (ii) the excess of the Gemphire Closing Price over the exercise price per share of the Gemphire common stock previously subject to such Gemphire Option by (b) the Gemphire Closing Price. Each outstanding and unexercised Gemphire Option that has an exercise price equal to or greater than the Gemphire Closing Price will be terminated and cease to exist as of immediately prior to the Effective Time for no consideration.

        The terms governing Gemphire Warrants will remain in full force and effect following the Closing of the merger.

Treatment of NeuroBo Options (see page 194)

        Pursuant to the Merger Agreement, at the Effective Time, each NeuroBo Option that is outstanding and unexercised immediately prior to the Effective Time, whether or not vested, will be assumed by Gemphire and will become an option to purchase that number of shares of Gemphire common stock equal to the product obtained by multiplying (i) the number of shares of NeuroBo common stock that were subject to such NeuroBo Option immediately prior to the Effective Time by (ii) the Exchange Ratio, and rounding the resulting number down to the nearest whole number of shares of Gemphire common stock. The per share exercise price for shares of Gemphire common stock issuable upon exercise of each NeuroBo Option assumed by Gemphire shall be determined by dividing (a) the per share exercise price of NeuroBo common stock subject to such NeuroBo Option, as in effect immediately prior to the Effective Time, by (b) the Exchange Ratio, and rounding the resulting exercise price up to the nearest whole cent. Any restriction on the exercise of any NeuroBo Option assumed by Gemphire will continue in full force and effect and the term, exercisability, vesting schedule and other provisions of such NeuroBo Option shall otherwise remain unchanged.

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Conditions to the Completion of the Merger (see page 195)

        To consummate the merger, Gemphire Stockholders must approve Proposal Nos. 1 and 2. Additionally, NeuroBo Stockholders must (i) adopt and approve of the Merger Agreement and the transactions contemplated thereby, (ii) acknowledge that the approval given is irrevocable and that such stockholder is aware of its rights to demand appraisal for its shares pursuant to Section 262 of the General Corporation Law of the State of Delaware ("DGCL"), and that such stockholder has received and read a copy of Section 262 of the DGCL and (iii) acknowledge that by its approval of the merger it is not entitled to appraisal rights with respect to its shares in connection with the merger and thereby waives any rights to receive payment of the fair value of its capital stock under the DGCL.

        In addition to obtaining such stockholder approvals and appropriate regulatory approvals, each of the other closing conditions set forth in the Merger Agreement, as described under the section entitled "The Merger Agreement—Conditions to the Completion of the Merger" in this proxy statement/prospectus/information statement must be satisfied or waived.

No Solicitation (see page 199)

        Each of Gemphire and NeuroBo agreed that during the period commencing on the date of the Merger Agreement and ending on the earlier of the consummation of the merger or the termination of the Merger Agreement, except as described below, Gemphire and NeuroBo and any of their respective subsidiaries will not, nor will either party or any of its subsidiaries authorize any of the directors, officers, employees, agents, attorneys, accountants, investment bankers, advisors or representatives retained by it or any of its subsidiaries to, directly or indirectly:

    solicit, initiate or knowingly encourage, induce or facilitate the communication, making, submission or announcement of, any "acquisition proposal" or "acquisition inquiry" or take any action that could reasonably be expected to lead to an acquisition proposal or acquisition inquiry;

    furnish any non-public information with respect to it to any person in connection with or in response to an acquisition proposal or acquisition inquiry;

    engage in discussions or negotiations with any person with respect to any acquisition proposal or acquisition inquiry;

    approve, endorse or recommend an acquisition proposal;

    execute or enter into any letter of intent or similar document or any contract contemplating or otherwise relating to any "acquisition transaction" (other than a confidentiality agreement permitted by the Merger Agreement); or

    publicly propose to do any of the above.

Termination (see page 205)

        Either Gemphire or NeuroBo can terminate the Merger Agreement under certain circumstances, which would prevent the merger from being consummated.

Termination Fee (see page 207)

        If the Merger Agreement is terminated under certain circumstances, Gemphire or NeuroBo will be required to pay the other party a termination fee of up to $1.0 million.

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CVR Agreement (see page 209)

        Pursuant to the Merger Agreement and the CVR Agreement, for each share of Gemphire common stock held after giving effect to the Gemphire Reverse Stock Split, Gemphire Stockholders of record as of immediately prior to the Effective Time will receive one CVR entitling such holders to receive, in the aggregate, 80% of the Gross Consideration less other Permitted Deductions received during the 15-year period after the Closing of the merger (the "CVR Term") from the grant, sale or transfer of rights to gemcabene (other than a grant, sale or transfer of rights involving a sale or disposition of the post-merger combined company) that is entered into during the 10-year period after the Closing of the merger or pursuant to the Beijing SL License Agreement.

        Under the CVR Agreement, the combined organization has agreed to commit $1 million to support the further development of gemcabene through the quarter ending March 31, 2020, to be funded following the receipt by Gemphire of the $2.5 million upfront gross payment payable under the Beijing SL License Agreement.

        The sole right of the holders of the CVRs is to receive cash from Gemphire, if any, through the rights agent in accordance with the CVR Agreement. The CVRs are not transferable, except in certain limited circumstances, will not be certificated or evidenced by any instrument and will not be registered with the SEC or listed for trading on any exchange. The CVRs will not have any voting or dividend rights, will not represent any equity or ownership interest in Gemphire or its subsidiaries, and interest will not accrue in any amounts payable on the CVRs. The CVR Agreement will be effective prior to the Closing of the merger and will continue in effect until the later of the end of the CVR Term and the payment of all amounts payable thereunder, unless and until earlier terminated upon termination of the Merger Agreement.

Voting Agreements and Written Consents (see page 213)

        Concurrently with the execution of the Merger Agreement, the executive officers and directors and certain other Gemphire Stockholders entered into voting agreements with NeuroBo and Gemphire relating to the merger covering approximately 26% of the outstanding capital stock of Gemphire, as of date of the Merger Agreement. The voting agreements provide, among other things, that the stockholders who are parties to the voting agreements will vote all of the shares held by them in favor of Proposal Nos. 1, 2, 3, and 4.

        Concurrently with the execution of the Merger Agreement, NeuroBo officers, directors and holders of 5% or more of NeuroBo capital stock entered into voting agreements with Gemphire and NeuroBo covering approximately 90% of the outstanding capital stock of NeuroBo as of the date of the Merger Agreement. The voting agreements provide, among other things, that the directors, officers and securityholders party to the NeuroBo voting agreements will vote all of the shares of NeuroBo held by them in favor of (i) the adoption and approval of the Merger Agreement and the transactions contemplated thereby, (ii) acknowledgement that the approval given for the Merger Agreement is irrevocable and that the stockholder is aware of its appraisal rights under the DGCL, (iii) acknowledgement that the stockholder is not entitled to appraisal rights by voting in favor of the transaction and waiving appraisal rights under the DGCL, and (iv) the conversion of each share of NeuroBo preferred stock and each NeuroBo convertible note into NeuroBo common stock. The NeuroBo voting agreements also place certain restrictions on the transfer of the shares of NeuroBo held by the respective signatories thereto.

Nasdaq Stock Market Listing (see page 188)

        Gemphire has filed an initial listing application with Nasdaq pursuant to Nasdaq Stock Market LLC "business combination" rules. If such application is accepted, Gemphire anticipates that

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Gemphire common stock will be listed on Nasdaq following the closing of the merger under the trading symbol "NRBO."

Lock-up Agreements (see page 215)

        As a condition to the Closing of the merger, certain stockholders of each of Gemphire and NeuroBo and their affiliates, have entered into lock-up agreements, pursuant to which such parties have agreed not to, except in limited circumstances, offer, pledge, sell, contract to sell, transfer or dispose of, directly or indirectly, engage in swap or similar transactions with respect to, or make any demand for or exercise any right with respect to, any shares of Gemphire common stock or any security convertible into or exercisable or exchangeable for Gemphire common stock, including, as applicable, shares received in the merger and issuable upon exercise of certain warrants and options, during the period commencing at the Effective Time and continuing until the date that is 180 days from the Effective Time.

        Each of the directors and officers of Gemphire is a party to a lock-up agreement. As of September 30, 2019, Gemphire Stockholders who have executed lock-up agreements beneficially owned in the aggregate approximately 14% of the outstanding Gemphire common stock.

        NeuroBo Stockholders who have executed lock-up agreements, as of September 30, 2019, beneficially owned in the aggregate approximately 90% of the outstanding shares of NeuroBo capital stock on an as converted to common stock basis.

        NeuroBo and Gemphire may waive the restrictions applicable to certain NeuroBo and Gemphire stockholders in their discretion and as needed to comply with the initial listing requirements of the Nasdaq Stock Market LLC and as described under the section entitled "Agreements Related to the Merger—Lock-Up Agreements" in this proxy statement/prospectus/information statement.

Management Following the Merger (see page 361)

        Effective as of the Closing, Gemphire's officers are expected to include::

Name
  Position
John L. Brooks, III   President, Chief Executive Officer, Interim Chief Financial Officer and Class III Director

Mark Versavel, M.D., Ph.D., M.B.A. 

 

Chief Medical Officer

Nandan Padukone, Ph.D., M.B.A. 

 

Senior Vice President, Business Development

Nicola Shannon

 

Vice President, Clinical Operations

Interests of Certain Directors and Officers of Gemphire and NeuroBo (see page 172)

        In considering the recommendation of the Gemphire Board with respect to issuing shares of Gemphire common stock as contemplated by the Merger Agreement and the other matters to be acted upon by Gemphire Stockholders at the Gemphire annual meeting, Gemphire Stockholders should be aware that certain members of the Gemphire Board and certain of Gemphire's executive officers have interests in the merger that may be different from, or in addition to, the interests of Gemphire Stockholders. For example, Gemphire has entered into amended employment agreements with its executive officers that may result in the receipt by such executive officers of cash severance payments and other benefits upon an eligible termination of employment of each executive officer's employment in connection with the merger, and all of Gemphire's directors and executive officers are entitled to certain indemnification and liability insurance coverage pursuant to the terms of the Merger Agreement.

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        As of September 30, 2019, Gemphire's directors and executive officers beneficially owned, in the aggregate approximately 14% of the outstanding shares of Gemphire common stock. As of September 30, 2019, Gemphire's directors and current executive officers owned, in the aggregate, unvested Gemphire stock options covering 440,665 shares of Gemphire common stock and vested Gemphire stock options covering 771,174 shares of Gemphire common stock.

        Dr. Steven Gullans, currently the President and Chief Executive Officer of Gemphire, is expected to be terminated from his position as an officer of Gemphire as of the Effective Time of the merger. After the Effective Time of the merger, it is expected that Dr. Gullans will be appointed to the board of directors of the combined company.

        The compensation arrangements with Gemphire's officers and directors are discussed in greater detail in the section entitled "The Merger—Interests of Gemphire Directors and Executive Officers in the Merger" in this proxy statement/prospectus/information statement.

        In considering the recommendation of the NeuroBo Board with respect to approving the merger, NeuroBo Stockholders should be aware that certain members of the NeuroBo Board and executive officers of NeuroBo have interests in the merger that may be different from, or in addition to, interests they have as NeuroBo Stockholders. All of NeuroBo's executive officers and directors have options, subject to vesting, to purchase shares of NeuroBo common stock that will be converted into and become options to purchase shares of Gemphire common stock. Certain of NeuroBo's directors and executive officers are expected to become directors and executive officers of the combined organization as described in "Management Following the Merger" upon the Closing, and all of NeuroBo's directors and executive officers are entitled to certain indemnification and liability insurance coverage pursuant to the terms of the Merger Agreement.

        As of September 30, 2019, NeuroBo's directors and executive officers beneficially owned: (i) approximately 57% of the outstanding shares of NeuroBo common stock, (ii) approximately 82% of the outstanding shares of NeuroBo preferred stock, (iii) options to purchase 125,000 shares of NeuroBo common stock, all of which will be converted into options to purchase Gemphire common stock in connection with the closing of the merger pursuant to the Merger Agreement.

        The compensation arrangements with NeuroBo's officers and directors are discussed in greater detail in the section entitled "The Merger—Interests of NeuroBo Directors and Executive Officers in the Merger" in this proxy statement/prospectus/information statement.

Risk Factors (see page 30)

        Both Gemphire and NeuroBo are subject to various risks associated with their businesses and their industries. In addition, the merger poses a number of risks to each company and its respective stockholders, including the possibility that the merger may not be completed and the following risks:

    The Exchange Ratio set forth in the Merger Agreement is not adjustable based on the market price of Gemphire common stock, so the merger consideration at the Closing of the merger may have a greater or lesser value than at the time the Merger Agreement was signed.

    Failure to complete the merger may result in either Gemphire or NeuroBo paying a termination fee to the other party and could significantly harm the market price of Gemphire common stock and negatively affect the future business and operations of each company.

    The issuance of Gemphire common stock to NeuroBo Stockholders pursuant to the Merger Agreement and the resulting change in control from the merger must be approved by Gemphire Stockholders, and the Merger Agreement and transactions contemplated thereby must be approved by the NeuroBo Stockholders. Failure to obtain these approvals would prevent the Closing of the merger.

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    The merger may be completed even though certain events occur prior to the Closing that materially and adversely affect Gemphire or NeuroBo.

    Some Gemphire and NeuroBo officers and directors have interests in the merger that are different from the respective stockholders of Gemphire and NeuroBo and that may influence them to support or approve the merger without regard to the interests of the respective stockholders of Gemphire and NeuroBo.

    The market price of Gemphire common stock following the merger may decline as a result of the merger.

    Gemphire Stockholders may not receive any payment on the CVRs and the CVRs may otherwise expire valueless.

    Gemphire Stockholders and NeuroBo securityholders will have a reduced ownership and voting interest in, and will exercise less influence over the management of, the combined organization following the Closing of the merger as compared to their current ownership and voting interest in the respective companies.

    Gemphire and NeuroBo Stockholders may not realize a benefit from the merger commensurate with the ownership dilution they will experience in connection with the merger.

    During the pendency of the merger, Gemphire and NeuroBo may not be able to enter into a business combination with another party at a favorable price because of restrictions in the Merger Agreement, which could adversely affect their respective businesses.

    Certain provisions of the Merger Agreement may discourage third parties from submitting alternative takeover proposals, including proposals that may be superior to the arrangements contemplated by the Merger Agreement.

    Because the lack of a public market for NeuroBo capital stock makes it difficult to evaluate the value of NeuroBo capital stock, the NeuroBo Stockholders may receive shares of Gemphire common stock in the merger that have a value that is less than, or greater than, the fair market value of NeuroBo capital stock.

    If the conditions to the merger are not met, the merger will not occur.

        These risks and other risks are discussed in greater detail under the section entitled "Risk Factors" in this proxy statement/prospectus/information statement. Gemphire and NeuroBo both encourage you to read and consider all of these risks carefully.

Regulatory Approvals (see page 183)

        In the United States, Gemphire must comply with applicable federal and state securities laws and the rules and regulations of Nasdaq in connection with the issuance of shares of Gemphire common stock and the filing of this proxy statement/prospectus/information statement with the SEC.

Anticipated Accounting Treatment (see page 188)

        Although Gemphire is the legal acquirer and will issue shares of Gemphire common stock to affect the merger with NeuroBo, NeuroBo is considered the accounting acquirer. In accordance with the accounting guidance under ASU 2017-01, the merger is considered an asset acquisition. Accordingly, the assets and liabilities of Gemphire will be recorded as of the merger Closing date at the purchase price of the accounting acquirer, NeuroBo. NeuroBo will have to allocate the total purchase price among the individual net assets acquired on a fair value basis. Determination of fair value of certain assets acquired is dependent upon certain valuations that have yet to commence or progress to a stage where there is sufficient information for a definitive measurement. A final determination of these

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estimated fair values, which cannot be made prior to the completion of the transaction, will be based on the actual net tangible assets of Gemphire that exist as of the date of the completion of the transaction. Therefore, the actual purchase price allocation may differ from the amounts reflected in the unaudited pro forma condensed combined financial statements. The unaudited pro forma condensed consolidated financial statements include the accounts of Gemphire since the effective date of merger and NeuroBo since inception.

Appraisal Rights and Dissenters' Rights (see page 189)

        Holders of Gemphire common stock are not entitled to appraisal rights in connection with the merger. Holders of NeuroBo common stock are entitled to appraisal rights in connection with the merger under Delaware law. For more information about such rights, please see the provisions of Section 262 of the General Corporation Law of the State of Delaware (the "DGCL") attached as Annex F and the section entitled "The Merger—Appraisal Rights and Dissenters' Rights" in this proxy statement/prospectus/information statement.

Comparison of Stockholder Rights (see page 389)

        Both Gemphire and NeuroBo are incorporated under the laws of the State of Delaware and, accordingly, the rights of the stockholders of each are currently, and will continue to be, governed by the DGCL. If Proposals Nos. 1 and 2 are approved by Gemphire Stockholders at the Gemphire annual meeting and, the merger is completed, NeuroBo Stockholders will become stockholders of Gemphire, and rights will be governed by the DGCL, Gemphire's amended and restated bylaws (the "Gemphire Bylaws") and, the Gemphire Certificate of Incorporation. The rights of Gemphire stockholders contained in the Gemphire Certificate of Incorporation and Gemphire Bylaws differ from the rights of NeuroBo Stockholders under the fourth amended and restated certificate of incorporation and bylaws of NeuroBo, as more fully described under the section entitled "Comparison of Rights of Holders of Gemphire Stock and NeuroBo Stock" in this proxy statement/prospectus/information statement.

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SELECTED HISTORICAL AND UNAUDITED PRO FORMA CONDENSED
COMBINED FINANCIAL DATA

        The following tables present summary historical financial data for Gemphire and NeuroBo, summary unaudited pro forma condensed combined financial data for Gemphire and NeuroBo, and comparative historical and unaudited pro forma per share data for Gemphire and NeuroBo.

Selected Historical Financial Data of Gemphire

        The following selected statement of operations data for the years ended December 31, 2018, 2017 and 2016 and the selected balance sheet data as of December 31, 2018 and 2017 was derived from Gemphire's audited financial statements included elsewhere in this proxy statement/prospectus/information statement. Gemphire derived the following selected statement of operations data for the years ended December 31, 2015 and 2014 and the selected balance sheet data as of December 31, 2016, 2015 and 2014 from audited financial statements that are not included in this proxy statement/prospectus/information statement. The following selected financial data as of and for the six months ended June 30, 2019 and 2018 are derived from Gemphire's unaudited condensed financial statements included in this proxy statement/prospectus/information statement.

        Gemphire's historical results are not necessarily indicative of the results that may be expected in the future. You should read the selected financial data below in conjunction with the section entitled "Gemphire Management's Discussion and Analysis of Financial Condition and Results of Operations" and

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Gemphire's financial statements and related notes appearing elsewhere in this proxy statement/prospectus/information statement.

 
  Year Ended December 31,   Six months Ended
June 30,
 
 
  2018   2017   2016   2015   2014   2019   2018  
 
   
   
   
   
   
  (unaudited)
 
 
  (in thousands, except share and per share data)
 

Statement of Operations Data:

                                           

Operating expenses:

                                           

General and administrative

  $ 8,493   $ 10,438   $ 5,956   $ 3,177   $ 214   $ 2,522   $ 4,661  

Research and development

    14,312     22,686     8,740     3,991     52     2,627     8,937  

Acquired in—process research and development

                908              

Total operating expenses

    22,805     33,124     14,696     8,076     266     5,149     13,598  

Loss from operations

    (22,805 )   (33,124 )   (14,696 )   (8,076 )   (266 )   (5,149 )   (13,598 )

Interest (expense) income

    (654 )   (286 )   114     (762 )   (55 )   (820 )   (304 )

Loss on convertible note extinguishment

                (198 )            

Other (expense) income

    (178 )   (5 )   (4 )   7     1     (752 )    

Loss before income taxes

    (23,637 )   (33,415 )   (14,586 )   (9,029 )   (320 )   (6,721 )   (13,902 )

Provision (benefit) for income taxes

                             

Net loss

    (23,637 )   (33,415 )   (14,586 )   (9,029 )   (320 )   (6,721 )   (13,902 )

Other comprehensive loss, net of tax

                             

Comprehensive loss

  $ (23,637 ) $ (33,415 ) $ (14,586 ) $ (9,029 ) $ (320 ) $ (6,721 ) $ (13,902 )

Net loss

  $ (23,637 ) $ (33,415 ) $ (14,586 ) $ (9,029 ) $ (320 ) $ (6,721 ) $ (13,902 )

Adjustment to redemption value on Series A convertible preferred stock

            (366 )   (2,968 )            

Premium upon substantial modification of convertible notes with certain stockholders

                (1,047 )            

Net loss attributable to common stockholders

  $ (23,637 ) $ (33,415 ) $ (14,952 ) $ (13,044 ) $ (320 ) $ (6,721 ) $ (13,902 )

Net loss per share:

                                           

Basic and diluted

  $ (1.71 ) $ (3.23 ) $ (2.57 ) $ (4.54 ) $ (0.21 ) $ (0.47 ) $ (1.04 )

Number of shares used in per share calculations:

                                           

Basic and diluted(1)

    13,805,552     10,349,136     5,809,396     2,875,053     1,521,703     14,265,411     13,340,941  

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  As of December 31,   As of June 30,  
 
  2018   2017   2016   2015   2014   2019   2018  
 
  (in thousands)
  (unaudited)
 

Balance Sheet Data:

                                           

Cash and cash equivalents

  $ 18,954   $ 18,473   $ 24,033   $ 3,620   $ 317   $ 3,643   $ 28,039  

Total assets

    19,694     19,017     24,754     4,490     330     4,014     28,806  

Convertible notes (including premium conversion derivative)

                6,769     810          

Term loan (long-term portion)

        8,683                     7,540  

Total liabilities

    11,920     15,076     4,122     8,917     861     2,050     13,758  

Series A convertible preferred stock

                7,953              

Accumulated deficit

    (84,111 )   (60,474 )   (27,059 )   (12,392 )   (584 )   (90,832 )   (74,376 )

Total stockholders' equity (deficit)

    7,774     3,941     20,632     (12,380 )   (531 )   1,964     15,048  

(1)
Basic and diluted net loss per share attributable to common stockholders is computed based on the weighted-average number of shares of common stock outstanding during each period. In April 2016, our board of directors approved an amendment to our certificate of incorporation to effect a 1-for-3.119 reverse stock split (the Reverse Stock Split) for all common and Series A preferred stock, effective on April 27, 2016. All share and per share data in this table has been adjusted to reflect the Reverse Stock Split. For additional information, see Note 1 to our audited financial statements included elsewhere in this proxy statement/prospectus/information statement.

Selected Historical Financial Data of NeuroBo

        The selected statement of operations data for the year ended December 31, 2018 and the period from inception (July 25, 2017) to December 31, 2017 and the selected balance sheet data as of December 31, 2018 and December 31, 2017 are derived from NeuroBo's audited consolidated financial statements prepared using accounting principles generally accepted in the United States ("U.S. GAAP"), which are included in this proxy statement/prospectus/information statement. The selected statement of operations data for the six months ended June 30, 2019 and 2018 and the selected balance sheet data as of June 30, 2019 are derived from NeuroBo's unaudited condensed consolidated financial statements included in this proxy statement/prospectus/information statement. The financial data should be read in conjunction with the section entitled "NeuroBo Management's Discussion and Analysis of Financial Condition and Results of Operations" and NeuroBo's consolidated financial statements and related notes appearing elsewhere in this proxy statement/prospectus/

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information statement. The historical results are not necessarily indicative of results to be expected in any future period.

 
   
  From
Inception
(July 25, 2017)
to
December 31,
2017
   
   
 
 
   
  Six Months Ended  
 
  Year Ended
December 31,
2018
 
 
  June 30, 2019   June 30, 2018  
 
  (in thousands, except per share data)
 
 
   
   
  (Unaudited)
 

Statement of Operations Data Operating Expenses:

                         

Research and development expenses

  $ 13,881   $   $ 2,748   $ 8,953  

General and administrative expenses

    1,605     25     1,590     345  

Loss from operations

    (15,486 )   (25 )   (4,338 )   (9,298 )

Net loss

    (15,529 )   (25 )   (4,365 )   (9,314 )

Net loss per share, basic and diluted

  $ (4.18 ) $ (0.02 ) $ (0.97 ) $ (3.21 )

Weighted average common shares outstanding, basic and diluted

    3,719,123     1,137,500     4,520,000     2,904,972  

 

 
  As of December 31,    
 
 
  As of
June 30,
2019
 
 
  2018   2017  
 
  (in thousands, except per share data)
 
 
   
   
  (Unaudited)
 

Balance Sheet Data:

                   

Cash

  $ 2,845   $ 50   $ 24,588  

Working capital, net

    3,589     25     23,518  

Total assets

    3,820     53     24,687  

Preferred stock

    16,746         40,921  

Additional paid-in capital

    2,266     50     2,405  

Accumulated deficit

    (15,554 )   (25 )   (19,919 )

Total stockholders' equity

  $ (13,286 ) $ 25   $ (17,503 )

Selected Unaudited Pro Forma Condensed Combined Financial Data of Gemphire and NeuroBo

        The following selected unaudited pro forma condensed combined financial data was prepared using the acquisition method of accounting under U.S. GAAP. For accounting purposes, NeuroBo was determined to be the accounting acquirer in the merger. The unaudited pro forma condensed combined statements of operations data assume that the merger took place as of January 1, 2018, and combines the historical results of Gemphire and NeuroBo for the six months ended June 30, 2019 and the year ended December 31, 2018. The unaudited pro forma combined balance sheet data assume that the merger took place on June 30, 2019, and combines the Gemphire and NeuroBo historical balance sheets as of June 30, 2019. The following information does not give effect to the Gemphire Reverse Stock Split, or to any additional proceeds NeuroBo may receive in the Pre-Closing Financing above the $24,240,000 already received.

        The selected unaudited pro forma condensed combined financial data are presented for illustrative purposes only and are not necessarily indicative of the combined financial position or results of operations of future periods or the results that actually would have been realized had the entities been a single entity during these periods. The selected unaudited pro forma condensed combined financial

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data as of and for the six months ended June 30, 2019 and for the year ended December 31, 2018 are derived from the unaudited pro forma condensed combined financial information and should be read in conjunction with that information. For more information, please see the section entitled "Unaudited Pro Forma Condensed Combined Financial Statements" in this proxy statement/prospectus/information statement.

        The unaudited pro forma condensed combined financial information assumes that, at the Effective Time, each share of NeuroBo common stock will be converted into the right to receive shares of Gemphire common stock such that, immediately after the merger, the Gemphire Securityholders are expected to own, or hold rights to acquire, in the aggregate approximately 4.06% of the Fully Diluted Closing Gemphire Common Stock and NeuroBo Securityholders are expected to own, or hold rights to acquire, in the aggregate approximately 95.94% of the Fully Diluted Closing Gemphire Common Stock, subject to adjustment to account for the occurrence of certain events discussed elsewhere in this proxy statement/prospectus/information statement.

Unaudited Pro Forma Condensed Combined Statements of Operations Data

 
  Year Ended
December 31, 2018
  Six Months
Ended
June 30, 2019
 
 
  (in thousands, except per share data)
 

Research and development expenses

  $ 28,193   $ 5,375  

General and administrative expenses

    10,098     4,112  

Loss from operations

    (38,291 )   (9,487 )

Net loss

    (39,125 )   (10,400 )

Net loss per share, basic and diluted

  $ (0.18 ) $ (0.03 )

Unaudited Pro Forma Condensed Combined Balance Sheet Data

 
  As of
June 30, 2019
 
 
  (in thousands)
 

Cash and cash equivalents

  $ 28,231  

Working capital, net

    19,551  

Total assets

    28,701  

Accumulated deficit

    (35,145 )

Total stockholders' equity

  $ 19,646  

Comparative Historical and Unaudited Pro Forma Per Share Data

        The information below reflects the historical net loss and book value per share of Gemphire common stock and the historical net loss and book value per unit of NeuroBo common stock in comparison with the unaudited pro forma net loss and book value per share after giving effect to the merger on a pro forma basis. The unaudited pro forma net loss and book value per share does not give effect to the Gemphire Reverse Stock Split.

        You should read the tables below in conjunction with the audited and unaudited financial statements of Gemphire, the audited and unaudited consolidated financial statements of NeuroBo, the unaudited pro forma condensed combined financial information, and notes related to such financial statements included elsewhere in this proxy statement/prospectus/information statement.

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Gemphire

 
  Year Ended
December 31, 2018
  Six Months
Ended
June 30, 2019
 

Historical Per Common Share Data:

             

Basic and diluted net loss per share

  $ (1.71 ) $ (0.47 )

Book value per share

  $ 0.54   $ 0.14  

NeuroBo

 
  Year Ended
December 31, 2018
  Six Months
Ended
June 30, 2019
 

Historical Per Common Share Data:

             

Basic and diluted net loss per share

  $ (4.18 ) $ (0.97 )

Book value per share

  $ (2.94 ) $ (3.87 )

Combined company

 
  Year Ended
December 31, 2018
  Six Months
Ended
June 30, 2019
 

Historical Per Common Share Data:

             

Basic and diluted net loss per share

  $ (0.18 ) $ (0.03 )

Book value per share

    N/A   $ 0.06  

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MARKET PRICE AND DIVIDEND INFORMATION

        Gemphire common stock is listed on the Nasdaq Capital Market under the symbol "GEMP." NeuroBo is a private company and shares of NeuroBo common stock and NeuroBo preferred stock are not publicly traded. The closing price of Gemphire common stock on June 23, 2019, the last trading day prior to the public announcement of the merger, was $0.72 per share, and the closing price of Gemphire common stock was $            on                , 2019, each as reported on the Nasdaq Capital Market. Because the market price of Gemphire common stock is subject to fluctuation, the market value of the shares of Gemphire common stock that NeuroBo Stockholders will be entitled to receive in the merger may increase or decrease.

        Assuming approval of Proposal Nos. 1 and 2 and successful application for initial listing on the Nasdaq Capital Market, following the consummation of the merger, the Gemphire common stock will trade on the Nasdaq Capital Market under the symbol "NRBO".

        As of                , 2019, the Record Date for the Gemphire annual meeting, there were approximately                holders of record of Gemphire common stock. As of                , 2019, NeuroBo had                holders of record of NeuroBo common stock and                holders of record of NeuroBo preferred stock. For detailed information regarding the beneficial ownership of certain Gemphire Stockholders upon consummation of the merger, see the section entitled "Principal Stockholders of Combined Organization" in this proxy statement/prospectus/information statement.

Dividends

        Gemphire has never declared or paid any cash dividends on the Gemphire common stock and does not anticipate paying cash dividends on the Gemphire common stock for the foreseeable future. Notwithstanding the foregoing, any determination to pay cash dividends subsequent to the merger will be at the discretion of the combined organization's then-current board of directors and will depend upon a number of factors, including the combined organization's results of operations, financial condition, future prospects, contractual restrictions, restrictions imposed by applicable law and other factors the then-current board of directors deems relevant.

        NeuroBo has never paid or declared any cash dividends on the NeuroBo capital stock. If the merger does not occur, NeuroBo does not anticipate paying any cash dividends on the NeuroBo capital stock in the foreseeable future, and NeuroBo intends to retain all available funds and any future earnings to fund the development and expansion of its business. Any future determination to pay dividends will be at the discretion of the NeuroBo Board and will depend upon a number of factors, including its results of operations, financial condition, future prospects, contractual restrictions, and restrictions imposed by applicable laws and other factors the NeuroBo Board deems relevant.

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RISK FACTORS

        The combined organization will be faced with a market environment that cannot be predicted and that involves significant risks, many of which will be beyond its control. In addition to the other information contained in this proxy statement/prospectus/information statement, you should carefully consider the material risks described below and those described in the section of this proxy statement/prospectus/information statement entitled "Cautionary Statement Concerning Forward-Looking Statements" before deciding how to vote your shares of stock. You should also read and consider the other information in this proxy statement/prospectus/information statement. Please see the section titled "Where You Can Find More Information" in this proxy statement/prospectus/information statement.

Risks Related to the Merger

The Exchange Ratio set forth in the Merger Agreement is not adjustable based on the market price of Gemphire common stock, so the merger consideration at the Closing of the merger may have a greater or lesser value than at the time the Merger Agreement was signed.

        The Merger Agreement has set the Exchange Ratio for the NeuroBo capital stock, and the Exchange Ratio is based on the fully-diluted capitalization of NeuroBo and Gemphire, in each case immediately prior to the Closing of the merger as described in the section entitled "The Merger—Merger Consideration and Exchange Ratio." Applying the Exchange Ratio in the Merger Agreement, the Gemphire Securityholders immediately prior to the merger are expected to own, or hold rights to acquire, in the aggregate, approximately 4.06% of the Fully Diluted Closing Gemphire Common Stock and NeuroBo Securityholders immediately prior to the merger are expected to own, or hold rights to acquire, in the aggregate, approximately 95.94% of the Fully Diluted Closing Gemphire Common Stock, in each case, immediately following the merger, on a fully-diluted basis and assuming Gemphire's Parent Cash Amount is negative $3 million and that NeuroBo raises the minimum required amount of $24,240,000 in its Pre-Closing Financing each as described in the section entitled "The Merger Agreement—Conditions to the Completion of the Merger". The Exchange Ratio is subject to adjustment to the extent Gemphire's Parent Cash Amount is negative or to reflect aggregate gross proceeds received by NeuroBo in its Pre-Closing Financing before the Closing of the merger above the minimum required amount and up to and including $50 million, and as a result, either Gemphire Stockholders or the NeuroBo Stockholders could own less of the combined company than currently expected. As a result, Gemphire and NeuroBo Stockholders could own more or less of the combined organization or than currently expected.

        Any changes in the market price of Gemphire common stock before the completion of the merger will not affect the number of shares of Gemphire common stock issuable to NeuroBo Stockholders pursuant to the Merger Agreement. Therefore, if before the completion of the merger the market price of Gemphire common stock declines from the market price on the date of the Merger Agreement, then NeuroBo Stockholders could receive merger consideration with substantially lower value than the value of such merger consideration on the date of the Merger Agreement. Similarly, if before the completion of the merger the market price of Gemphire common stock increases from the market price of Gemphire common stock on the date of the Merger Agreement, then NeuroBo's Stockholders could receive merger consideration with substantially greater value than the value of such merger consideration on the date of the Merger Agreement. The Merger Agreement does not include a price-based termination right. Because the Exchange Ratio does not adjust as a result of changes in the market price of Gemphire common stock, for each one percentage point change in the market price of Gemphire common stock, there is a corresponding one percentage point rise or decline, respectively, in the value of the total merger consideration payable to NeuroBo's Stockholders pursuant to the Merger Agreement.

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Failure to complete the merger may result in either Gemphire or NeuroBo paying a termination fee to the other party and could significantly harm the market price of Gemphire common stock and negatively affect the future business and operations of each company.

        If the merger is not completed and the Merger Agreement is terminated under certain circumstances, Gemphire or NeuroBo may be required to pay the other party a termination fee of $1.0 million, or in some circumstances reimburse the other party's expenses up to a maximum of $500,000. Even if a termination fee or expenses of the other party are not payable in connection with a termination of the Merger Agreement, each of Gemphire and NeuroBo will have incurred significant fees and expenses, which must be paid whether or not the merger is completed. Further, if the merger is not completed, it could significantly harm the market price of Gemphire common stock.

        In addition, if the Merger Agreement is terminated and the Gemphire Board or NeuroBo Board determines to seek another business combination, there can be no assurance that either Gemphire or NeuroBo will be able to find a partner and close an alternative transaction on terms that are as favorable or more favorable than the terms set forth in the Merger Agreement. See the section entitled "Risk Factors—If the merger is not completed, Gemphire may not be able to otherwise source adequate liquidity to fund its operations, meet its obligations, and continue as a going concern. The Gemphire Board may decide to pursue a dissolution and liquidation of Gemphire. In such an event, there can be no assurances as to the amount or timing of available cash left, if any, to distribute to its stockholders after paying its debts and other obligations and setting aside funds for reserves."

The issuance of Gemphire common stock to NeuroBo Stockholders pursuant to the Merger Agreement and the resulting change in control from the merger must be approved by Gemphire Stockholders, and the Merger Agreement and transactions contemplated thereby must be approved by the NeuroBo Stockholders. Failure to obtain these approvals would prevent the Closing of the merger.

        Before the merger can be completed, the stockholders of each of Gemphire and NeuroBo must approve the merger. Failure to obtain the required stockholder approvals may result in a material delay in, or the abandonment of, the merger. Any delay in completing the merger may materially adversely affect the timing and benefits that are expected to be achieved from the merger.

The merger may be completed even though certain events occur prior to the Closing that materially and adversely affect Gemphire or NeuroBo.

        The Merger Agreement provides that either Gemphire or NeuroBo can refuse to complete the merger if there is a material adverse change affecting the other party between July 24, 2019, the date of the Merger Agreement, and the Closing of the merger. However, certain types of changes do not permit either party to refuse to complete the merger, even if such change could be said to have a material adverse effect on Gemphire or NeuroBo, including:

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        If adverse changes occur and Gemphire and NeuroBo still complete the merger, the market price of the combined organization's common stock may suffer. This in turn may reduce the value of the merger to the stockholders of Gemphire, NeuroBo or both.

Some Gemphire and NeuroBo officers and directors have interests in the merger that are different from the respective stockholders of Gemphire and NeuroBo and that may influence them to support or approve the merger without regard to the interests of the respective stockholders of Gemphire and NeuroBo.

        Certain officers and directors of Gemphire and NeuroBo participate in arrangements that provide them with interests in the merger that are different from the interests of the respective stockholders of Gemphire and NeuroBo, including, among others, the continued service as an officer or director of the combined organization, severance benefits, the acceleration of stock option vesting, continued indemnification and the potential ability to sell an increased number of shares of common stock of the combined organization in accordance with Rule 144 under the Securities Act of 1933, as amended.

        For example, Gemphire has entered into employment agreements and amendments to such employment agreements with its executive officers that may result in the receipt by such executive officers of cash severance payments, vesting of restricted stock awards and other benefits in the event of a covered termination of employment of each executive officer's employment. Gemphire issued each of Dr. Gullans, Dr. Bisgaier and Mr. Reno a Gemphire restricted stock award representing 300,000, 100,000 and 100,000 shares, respectively, of Gemphire common stock that will vest immediately prior to the Effective Time. In addition, grants of Gemphire restricted stock were also made to Gemphire's non-employee directors (45,000 shares of Gemphire restricted stock in the aggregate) that will vest immediately prior to the Effective Time. For more information concerning the issuance of Gemphire restricted stock in connection with the merger, see the section entitled "The Merger Agreement—Treatment of Gemphire Options and Warrants" in this proxy statement/prospectus/information statement. The Closing of the merger may also result in the acceleration of vesting of options to purchase shares of Gemphire common stock held by Gemphire's executive officers and directors, whether or not there is a covered termination of such officer's employment to the extent the exercise price per share of such options is less than the volume weighted average closing trading price of a share of Gemphire common stock on the Nasdaq Capital Market for the five trading days ending five trading days immediately prior to the date on which the merger becomes effective. In addition, and for example, certain of NeuroBo's directors and executive officers have options, subject to vesting, to purchase shares of NeuroBo's common stock which, at the Closing of the merger, shall be converted into and become options to purchase shares of Gemphire common stock, certain of NeuroBo's directors and executive officers are expected to become directors and executive officers of Gemphire upon the Closing of the merger, and all of NeuroBo's directors and executive officers are entitled to certain indemnification and liability insurance coverage pursuant to the terms of the Merger Agreement. These interests, among others, may influence the officers and directors of Gemphire and NeuroBo to support or approve the merger. For more information concerning the interests of Gemphire's and NeuroBo's executive officers and directors, see the sections entitled "The Merger—Interests of Gemphire Directors and Executive Officers in the Merger" and "The Merger—Interests of NeuroBo Directors and Executive Officers in the Merger."

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The market price of Gemphire common stock following the merger may decline as a result of the merger.

        The market price of Gemphire common stock may decline as a result of the merger for a number of reasons, including if:

Gemphire and NeuroBo securityholders will have a reduced ownership and voting interest in, and will exercise less influence over the management of, the combined organization following the Closing of the merger as compared to their current ownership and voting interest in the respective companies.

        If the proposed merger is completed, the current securityholders of Gemphire and NeuroBo will own a smaller percentage of the combined organization than their ownership in their respective companies prior to the merger. Each share of NeuroBo common stock outstanding immediately prior to the Effective Time will be converted into the right to receive shares of Gemphire common stock equal to the Exchange Ratio. Applying the Exchange Ratio in the Merger Agreement, the Gemphire Securityholders immediately prior to the merger are expected to own, or hold rights to acquire, in the aggregate, approximately 4.06% of the Fully Diluted Closing Gemphire Common Stock and NeuroBo Securityholders immediately prior to the merger are expected to own, or hold rights to acquire, in the aggregate, approximately 95.94% of the Fully Diluted Closing Gemphire Common Stock, in each case, immediately following the merger, assuming Gemphire Parent Cash Amount is negative $3 million and that NeuroBo raises the minimum required amount of $24,240,000 in its Pre-Closing Financing. The Exchange Ratio is subject to adjustment to the extent Gemphire's Parent Cash Amount is negative or to reflect aggregate gross proceeds received by NeuroBo in its Pre-Closing Financing before the Closing of the merger above the minimum required amount and up to and including $50 million. See also the risk factor above entitled "The Exchange Ratio set forth in the Merger Agreement is not adjustable based on the market price of Gemphire common stock, so the merger consideration at the closing of the merger may have a greater or lesser value than at the time the Merger Agreement was signed." Accordingly, the issuance of shares of Gemphire common stock to NeuroBo Stockholders in the merger will reduce significantly the relative voting power of each share of Gemphire common stock held by its current stockholders and will reduce the relative voting power of each share of NeuroBo common stock held by its current stockholders. Consequently, Gemphire Stockholders as a group and NeuroBo Stockholders as a group will have less influence over the management and policies of the combined company after the merger than prior to the merger. These estimates are based on the anticipated Exchange Ratio and are subject to adjustment as provided in the Merger Agreement.

        In addition, the six member board of directors of the combined company will initially include five individuals with prior NeuroBo affiliations and one individual with a prior Gemphire affiliation. Consequently, securityholders of Gemphire and NeuroBo will be able to exercise less influence over the management and policies of the combined organization following the Closing of the merger than they currently exercise over the management and policies of their respective companies.

Gemphire Stockholders and NeuroBo Stockholders may not realize a benefit from the merger commensurate with the ownership dilution they will experience in connection with the merger.

        If the combined organization is unable to realize the strategic and financial benefits currently anticipated from the merger, Gemphire Stockholders and NeuroBo Stockholders will have experienced

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substantial dilution of their ownership interests in their respective companies without receiving the expected commensurate benefit, or only receiving part of the commensurate benefit to the extent the combined organization is able to realize only part of the expected strategic and financial benefits currently anticipated from the merger.

The combined company will need to raise additional capital by issuing securities or debt or through licensing or other strategic arrangements, which may cause dilution to the combined company's stockholders or restrict the combined company's operations or impact its proprietary rights.

        The combined company may be required to raise additional funds sooner than currently planned. In this regard, while the Exchange Ratio may be impacted by cash levels of the respective companies at the Closing of the merger, the Merger Agreement does not condition the completion of the merger upon either company holding a minimum amount of cash at the Effective Time. If either or both of Gemphire or NeuroBo hold less cash at the time of the Closing than the parties currently expect, the combined company will need to raise additional capital sooner than expected. Additional financing may not be available to the combined company when it needs it or may not be available on favorable terms. To the extent that the combined company raises additional capital by issuing equity securities, such an issuance may cause significant dilution to the combined company's stockholders' ownership and the terms of any new equity securities may have preferences over the combined company's common stock. Any debt financing the combined company enters into may involve covenants that restrict its operations. These restrictive covenants may include limitations on additional borrowing and specific restrictions on the use of the combined company's assets, as well as prohibitions on its ability to create liens, pay dividends, redeem its stock or make investments. In addition, if the combined company raises additional funds through licensing, partnering or other strategic arrangements, it may be necessary to relinquish rights to some of the combined company's technologies or product candidates and proprietary rights, or grant licenses on terms that are not favorable to the combined company.

During the pendency of the merger, Gemphire and NeuroBo may not be able to enter into a business combination with another party at a favorable price because of restrictions in the Merger Agreement, which could adversely affect their respective businesses.

        Covenants in the Merger Agreement impede the ability of Gemphire and NeuroBo to make acquisitions, subject to certain exceptions relating to fiduciary duties, as set forth below, or to complete other transactions that are not in the ordinary course of business pending completion of the merger. As a result, if the merger is not completed, the parties may be at a disadvantage to their competitors during such period. In addition, while the Merger Agreement is in effect, each party is generally prohibited from soliciting, initiating, encouraging or entering into certain extraordinary transactions, such as a merger, sale of assets, or other business combination outside the ordinary course of business with any third party, subject to certain exceptions relating to fiduciary duties. Any such transactions could be favorable to such party's stockholders.

Certain provisions of the Merger Agreement may discourage third parties from submitting alternative takeover proposals, including proposals that may be superior to the arrangements contemplated by the Merger Agreement.

        The terms of the Merger Agreement prohibit each of Gemphire and NeuroBo from soliciting alternative takeover proposals or cooperating with persons making unsolicited takeover proposals, except in limited circumstances when such party's board of directors determines in good faith that an unsolicited alternative takeover proposal is or is reasonably likely to lead to a superior takeover proposal and that failure to cooperate with the proponent of the proposal would be reasonably likely to be inconsistent with the applicable board's fiduciary duties. Any such transactions could be favorable to such party's stockholders.

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Because the lack of a public market for NeuroBo capital stock makes it difficult to evaluate the value of NeuroBo capital stock, the NeuroBo Stockholders may receive shares of Gemphire common stock in the merger that have a value that is less than, or greater than, the fair market value of NeuroBo capital stock.

        The outstanding capital stock of NeuroBo is privately held and is not traded in any public market. The lack of a public market makes it extremely difficult to determine the fair market value of NeuroBo. Because the percentage of Gemphire common stock to be issued to NeuroBo Stockholders was determined based on negotiations between the parties, it is possible that the value of Gemphire common stock to be received by NeuroBo Stockholders will be less than the fair market value of NeuroBo, or Gemphire may pay more than the aggregate fair market value for NeuroBo.

If the conditions to the merger are not met, the merger will not occur.

        Before the proposed merger can be completed, the stockholders of each of Gemphire and NeuroBo must approve the Merger Agreement. There can be no assurances that the necessary stockholder approvals will be obtained. Failure to obtain stockholder approval may result in a material delay in, or the abandonment of, the merger. Even if the merger is approved by Gemphire Stockholders and NeuroBo Stockholders, certain other specified conditions set forth in the Merger Agreement must be satisfied or waived to complete the merger. These conditions are set forth in the Merger Agreement and described in the section entitled "The Merger Agreement—Conditions to the Completion of the Merger" in this proxy statement/prospectus/information statement. Gemphire and NeuroBo cannot assure you that all of the conditions will be satisfied or waived. If the conditions are not satisfied or waived, the merger will not occur or will be delayed, and Gemphire and NeuroBo each may lose some or all of the intended benefits of the merger.

Litigation relating to the merger could require Gemphire or NeuroBo to incur significant costs and suffer management distraction, and could delay or enjoin the merger.

        Gemphire and NeuroBo could be subject to demands or litigation related to the merger, whether or not the merger is consummated. Such actions may create uncertainty relating to the merger, or delay or enjoin the merger, result in substantial costs to Gemphire or NeuroBo and divert management time and resources.

Risks Related to the Proposed Reverse Stock Split

The proposed Gemphire Reverse Stock Split may not increase the combined organization's stock price over the long-term.

        One of the purposes of the proposed Gemphire Reverse Stock Split is to increase the per-share market price of the Gemphire common stock. It cannot be assured, however, that the proposed Gemphire Reverse Stock Split will accomplish this objective for any meaningful period of time. While it is expected that the reduction in the number of outstanding shares of Gemphire common stock will proportionally increase the market price of Gemphire common stock, it cannot be assured that the proposed Gemphire Reverse Stock Split will increase the market price of Gemphire common stock by a multiple of the proposed Gemphire Reverse Stock Split ratio, or result in any permanent or sustained increase in the market price of Gemphire common stock, which is dependent upon many factors, including the combined organization's business and financial performance, general market conditions and prospects for future success. Thus, while the stock price of the combined organization might meet the continued listing requirements for the Nasdaq Capital Market initially, it cannot be assured that it will continue to do so.

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The proposed Gemphire Reverse Stock Split may decrease the liquidity of the combined organization's common stock.

        Although the Gemphire Board believes that the anticipated increase in the market price of the combined organization's common stock could encourage interest in its common stock and possibly promote greater liquidity for its stockholders, such liquidity could also be adversely affected by the reduced number of shares outstanding after the proposed Gemphire Reverse Stock Split. The reduction in the number of outstanding shares may lead to reduced trading and a smaller number of market makers for Gemphire common stock.

The proposed Gemphire Reverse Stock Split may lead to a decrease in the combined organization's overall market capitalization.

        Should the market price of the combined organization's common stock decline after the proposed Gemphire Reverse Stock Split, the percentage decline may be greater, due to the smaller number of shares outstanding, than it would have been prior to the proposed Gemphire Reverse Stock Split. A reverse stock split may be viewed negatively by the market and, consequently, can lead to a decrease in the combined organization's overall market capitalization. If the per share market price does not increase in proportion to the proposed Gemphire Reverse Stock Split ratio, then the value of the combined organization, as measured by its stock capitalization, will be reduced. In some cases, the per-share stock price of companies that have effected reverse stock splits subsequently declined back to pre-reverse split levels, and accordingly, it cannot be assured that the total market value of Gemphire common stock will remain the same after the proposed Gemphire Reverse Stock Split is effected, or that the proposed Gemphire Reverse Stock Split will not have an adverse effect on the stock price of Gemphire common stock due to the reduced number of shares outstanding after the proposed Gemphire Reverse Stock Split.

Risks Related to Gemphire

Risks Related to Gemphire's Financial Condition and Gemphire's Need for Additional Financing, and Additional Risks Related to the Merger

If the merger is not completed, Gemphire may not be able to otherwise source adequate liquidity to fund its operations, meet its obligations, and continue as a going concern. The Gemphire Board may decide to pursue a dissolution and liquidation of Gemphire. In such an event, there can be no assurances as to the amount or timing of available cash left, if any, to distribute to its stockholders after paying its debts and other obligations and setting aside funds for reserves.

        While Gemphire has entered into the Merger Agreement with NeuroBo, the Closing of the merger may be delayed or may not occur at all and there can be no assurance that the merger will deliver the anticipated benefits Gemphire expects or enhance stockholder value. If the merger is not completed and the Merger Agreement is terminated under certain circumstances, Gemphire may be required to pay NeuroBo a termination fee of $1.0 million. Even if a termination fee is not payable in connection with a termination of the Merger Agreement, Gemphire will have incurred significant fees and expenses, which must be paid whether or not the merger is completed.

        As of June 30, 2019, Gemphire had cash and cash equivalents of $3.6 million. If the merger is not completed, based on Gemphire's current business plan and spending assumptions as a standalone company, Gemphire estimates that cash on hand is sufficient to fund operations into the third quarter of 2019. But Gemphire will need to raise additional capital to continue to fund the further development of gemcabene and its operations, including submission of the additional information requested by the FDA to make a decision regarding lifting the partial clinical hold. Gemphire has based its cash sufficiency estimates on its current business plan and its assumptions may prove to be wrong. Gemphire could utilize its available capital resources sooner than it currently expects, and it

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could need additional funding sooner than currently anticipated. Additionally, the process of advancing early stage product candidates and testing product candidates in clinical trials is costly, and the timing of progress in these clinical trials is uncertain. Even if Gemphire raises sufficient funds and decides to continue the development of gemcabene, its ability to successfully transition to profitability will be dependent upon achieving a level of product sales adequate to support its cost structure. Gemphire cannot assure you that it will ever be profitable or generate positive cash flow from operating activities.

        Failure to secure any necessary financing in a timely manner and on favorable terms or the failure of the proposed merger to be consummated in a timely manner would require Gemphire to delay or abandon clinical development plans. If, for any reason, the merger does not close, the Gemphire Board may elect to dissolve and liquidate Gemphire's assets. Alternatively, if Gemphire is able to secure additional capital to provide it with necessary financial resources to pursue other options, it may attempt to pursue another strategic transaction like the merger, sell or otherwise dispose of its assets or continue to operate its business. Any of these alternatives would be costly and time-consuming and would require that Gemphire obtain additional funding. Gemphire expects that it would be difficult to secure financing in a timely manner, on favorable terms or at all. Gemphire can make no assurances that it would be able to obtain additional financing or find a partner and close an alternative transaction on terms that are as favorable or more favorable than the terms set forth in the Merger Agreement or that any such alternatives are possible or would be successful, if pursued. To the extent that Gemphire seeks and is able to raise additional capital through the sale of equity or convertible debt securities, Gemphire Stockholders' ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect their rights as a common stockholder. Debt financing or preferred equity financing, if available, may involve agreements that include covenants limiting or restricting Gemphire's ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If Gemphire raises funds through strategic transactions or marketing, distribution, or licensing arrangements with third parties, Gemphire may have to relinquish valuable rights to its technologies, future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to it. Even if Gemphire is able to pursue such alternatives, the failure to complete the merger may result in negative publicity and/or a negative impression of Gemphire in the investment community, could significantly harm the market price of Gemphire common stock and may affect Gemphire's relationship with employees and other partners in the business community.

        If the Gemphire Board were to decide to dissolve and liquidate Gemphire's assets, Gemphire would be required to pay all of its debts and contractual obligations, and to set aside certain reserves for potential future claims, and there can be no assurances as to the amount or timing of available cash left, if any, to distribute to stockholders after paying its debts and other obligations and setting aside funds for reserves. In addition, Gemphire may be subject to litigation or other claims related to a dissolution and liquidation. If a dissolution and liquidation were pursued, the Gemphire Board, in consultation with its advisors, would need to evaluate these matters and make a determination about a reasonable amount to reserve. Accordingly, holders of Gemphire common stock would likely lose all or a significant portion of their investment in the event of a liquidation, dissolution or winding up of Gemphire.

        Gemphire does not believe that its current expenses are indicative of the costs it may incur in the future in connection with the development and commercialization of any product candidate if it consummates the merger or raises additional capital to continue its operations. Gemphire's future funding requirements will depend on many factors, including:

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        Gemphire currently has an effective shelf registration statement on Form S-3 on file with the SEC which expires in September 2020. The shelf registration statement permits the offering, issuance and sale of up to an aggregate offering price of $175 million of common stock, preferred stock, debt securities, warrants and subscription rights, of which $50 million may be offered, issued and sold under an "at-the-market" (ATM) equity distribution agreement with Piper Jaffray & Co. However, the amounts available under the shelf registration statement, including the ATM program, will be significantly limited as long as Gemphire's public float remains below $75 million, which, given its currently depressed stock price, limits its ability to obtain meaningful funding through the ATM program or the shelf registration statement at this time, although Gemphire could still raise funds through a registration statement on Form S-1 or through private placements.

Gemphire's recurring operating losses have raised substantial doubt regarding its ability to continue as a going concern.

        Gemphire's recurring operating losses raise substantial doubt about its ability to continue as a going concern. As a result, for the fiscal year ended December 31, 2018, Gemphire's independent registered public accounting firm issued its report on Gemphire's financial statements and expressed substantial doubt about Gemphire's ability to continue as a going concern. Gemphire has no current source of revenue to sustain its present activities beyond the upfront gross payment of $2.5 million due from Beijing SL under the Beijing SL License Agreement, and as of June 30, 2019, Gemphire had cash and cash equivalents of $3.6 million. If the merger does not occur, beyond the gross payment due from Beijing SL, Gemphire does not expect to generate revenue, if at all, until and unless the FDA or other applicable regulatory authorities approve gemcabene and it successfully commercializes gemcabene. Accordingly, Gemphire's ability to continue as a going concern will require it to obtain additional financing to fund its development and commercialization operations. Gemphire's current cash balance and uncertainty surrounding Gemphire's ability to continue as a going concern will make it difficult for Gemphire to obtain financing for the continuation of its operations and could result in the loss of confidence by investors, suppliers, contractors and employees. See "—If the merger is not completed, Gemphire may not be able to otherwise source adequate liquidity to fund its operations, meet its obligations, and continue as a going concern. The Gemphire Board may decide to pursue a dissolution and liquidation of Gemphire. In such an event, there can be no assurances as to the amount or timing of available cash left, if any, to distribute to its stockholders after paying its debts and other obligations and setting aside funds for reserves" above.

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Gemphire Stockholders may not receive any payment on the CVRs and the CVRs may otherwise expire valueless.

        The right of Gemphire Stockholders to receive any future payment on or derive any value from the CVRs will be contingent solely upon the achievement of the events specified in the CVR Agreement within the time periods specified in the CVR Agreement and the consideration received being greater than the amounts permitted to be retained or deducted by Gemphire under the CVR Agreement. Gemphire may not be able to grant, sale or transfer its rights to gemcabene during the 10-year period after the Closing of the merger, and Gemphire may not receive any future payments pursuant to the Beijing SL License Agreement after the Closing of the merger. If these events are not achieved for any reason within the time periods specified in the CVR Agreement or the consideration received is not greater than the amounts permitted to be retained or deducted by Gemphire, no payments will be made under the CVRs, and the CVRs will expire valueless. NeuroBo (as successor in interest to Gemphire) has agreed to commit $1 million to support the further development of gemcabene through the quarter ending March 31, 2020 (the "Covenant End Date"), to be funded following execution of the Beijing SL License Agreement and the receipt by Gemphire of the $2.5 million upfront gross payment payable under the Beijing SL License Agreement. Following the Effective Time of the merger, neither Gemphire nor NeuroBo will have any obligation to develop gemcabene, or to expend any funds or efforts with respect to gemcabene, other than the $1 million payment, to fund, (i) a toxicity study, (ii) a related Food and Drug Administration ("FDA") submission designed to result in the release of the partial clinical hold with respect to gemcabene, (iii) preparation for an end-of-phase 2 meeting with the FDA, and (iv) consulting costs for up to four of Gemphire's employees to support such activities. The expected cost of such activities is based on estimates and assumptions that may prove to be inaccurate. If $1 million is insufficient to fund the matters set forth above, neither Gemphire nor NeuroBo will have any obligation to provide further funding. Gemphire has no other obligation to support the development of gemcabene or to undertake any effort or expend any resource to divest or otherwise monetize gemcabene or to otherwise maximize the likelihood or amount of any CVR payment. Following the Covenant End Date, Gemphire may, at any time and in its sole and absolute discretion, discontinue any and all further efforts to develop, divest or otherwise monetize gemcabene.

        Furthermore, the CVRs will be unsecured obligations of the combined company and all payments under the CVRs, all other obligations under the CVR Agreement and the CVRs and any rights or claims relating thereto will be subordinated in right of payment to the prior payment in full of all current or future senior obligations of the combined company. Finally, the U.S. federal income tax treatment of the CVRs is unclear. There is no legal authority directly addressing the U.S. federal income tax treatment of the receipt of, and payments on, the CVRs, and there can be no assurance that the Internal Revenue Service ("IRS") would not assert, or that a court would not sustain, a position that could result in adverse U.S. federal income tax consequences to holders of the CVRs.

Gemphire has incurred only losses since inception. Gemphire expects to incur losses for the foreseeable future and may never achieve or maintain profitability.

        Since inception, Gemphire has incurred only operating losses. Gemphire's net losses were $6.7 million and $13.9 million for the six months ended June 30, 2019 and 2018 and $23.6 million, $33.4 million and $14.6 million for the years ended December 31, 2018, 2017 and 2016, respectively. As of June 30, 2019 and December 31, 2018, Gemphire had an accumulated deficit of $90.8 million and $84.1 million, respectively. Gemphire has financed its operations primarily through the issuance and sale of common stock and warrants in public offerings and a private placement, proceeds from its term loan facility with Silicon Valley Bank (SVB) (which was pre-paid and terminated in January 2019) and, prior to its IPO, the issuance of preferred stock and convertible notes in private placements. Gemphire has devoted substantially all of its financial resources and efforts on research and development,

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including clinical development of gemcabene. Gemphire expects that it will be a number of years, if ever, before it has a product candidate ready for commercialization. Gemphire expects to continue to incur significant expenses and increased operating losses for the foreseeable future.

        To become and remain profitable, Gemphire must develop and eventually commercialize a product with market potential, which would require it to raise additional capital. In addition, this will require Gemphire to be successful in a range of challenging activities, including completing preclinical testing and clinical trials, obtaining regulatory approval for a product candidate, manufacturing, marketing and selling any drug for which Gemphire may obtain regulatory approval and satisfying any post-marketing requirements. Gemphire is in the early stages of most of these activities. Gemphire may never raise enough capital or succeed in these activities and, even if it does, it may never generate revenues that are significant or large enough to achieve profitability.

        If Gemphire does achieve profitability, it may not be able to sustain or increase profitability on a quarterly or annual basis. Gemphire's failure to become and remain profitable would decrease the value of Gemphire and could impair its ability to raise capital, maintain its research and development efforts, expand its business or continue its operations and cause Gemphire Stockholders to lose all or part of their investment.

        If the merger is not completed and Gemphire is unable to raise sufficient additional funds for the development and commercialization of gemcabene or another product candidate, whether through potential collaborative, partnering or other strategic arrangements or otherwise, or if Gemphire otherwise determines to discontinue the development of gemcabene, Gemphire will likely determine to cease operations. Even if Gemphire is able to raise additional funds to permit the continued development of gemcabene or another product candidate, if Gemphire and/or any potential collaborators are unable to develop and commercialize gemcabene or another product candidate, if development is further delayed or is eliminated, or if sales revenue from any Gemphire product upon receiving marketing approval, if ever, is insufficient, Gemphire may never become profitable and it will not be successful.

Gemphire is substantially dependent on its remaining employees to facilitate the consummation of the merger.

        As of September 30, 2019, Gemphire had only seven full-time employees. Gemphire's ability to successfully complete the merger depends in large part on its ability to retain certain remaining personnel. Despite Gemphire's efforts to retain these employees, one or more may terminate their employment with Gemphire on short notice. The loss of the services of certain employees could potentially harm Gemphire's ability to consummate the merger, to run its day-to-day business operations, as well as to fulfill its reporting obligations as a public company.

The pendency of the merger could have an adverse effect on the trading price of Gemphire common stock and its business, financial condition and prospects.

        The pendency of the merger could disrupt Gemphire's business in many ways, including:

        Should they occur, any of these matters could adversely affect the trading price of Gemphire common stock or harm its business, financial condition and prospects.

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Raising additional capital may cause dilution to Gemphire Stockholders and restrict Gemphire's operations or require Gemphire to relinquish rights to its technologies or product candidates.

        Until such time, if ever, Gemphire expects to finance its cash needs through a combination of equity and debt financings as well as collaborations, strategic alliances and licensing arrangements. Gemphire does not have any committed external sources of funds beyond the $2.5 million upfront gross payment and potential milestone and royalty payments by Beijing SL pursuant to the Beijing SL License Agreement.

        To the extent outstanding warrants or options are ultimately exercised or the number of shares available for future grant under Gemphire's equity incentive plans each year are increased, investors will sustain further dilution.

Risks Related to the Development of Gemcabene or Any Future Product Candidate

Gemphire currently depends entirely on the success of gemcabene, its only product candidate, and the FDA's decision not to lift the partial clinical hold on gemcabene and to request that Gemphire provide additional data and the termination of the investigator-initiated Phase 2a pediatric NAFLD trial, each in August 2018, has severely diminished Gemphire's prospects to continue as a going concern. Gemphire's failure to obtain funding for and to advance the development of gemcabene would likely require it to cease operations. Even if Gemphire is able to obtain funding for and advance the development of gemcabene, Gemphire may never receive marketing approval for, or successfully commercialize, gemcabene for any indication.

        Gemphire currently has only one product candidate, gemcabene, in clinical development, and its business has depended on gemcabene's successful clinical development, regulatory approval and commercialization. In August 2018 Gemphire announced that the FDA, following submission of its two-year carcinogenicity study, requested additional preclinical studies. The FDA stated that Gemphire cannot proceed to its EOP2 meeting or begin its Phase 3 trials, which require more than 6 months of drug exposure, until this partial clinical hold is lifted. This request has significantly delayed the timeline for Gemphire's EOP2 meeting and start of Phase 3 trials. In August 2018, Gemphire announced that the DSMB at Emory University School of Medicine overseeing the investigator-led open label Phase 2a proof-of-concept trial evaluating gemcabene in pediatric patients with non-alcoholic fatty liver disease (NAFLD) recommended that the trial be terminated due to unanticipated problems. Following the announcement of the terminated NAFLD trial, Gemphire's stock price decreased and Gemphire's ability to raise additional capital and to secure potential collaborative, partnering or other strategic arrangements and consequently, Gemphire's prospects to continue as a going concern have been severely diminished. Gemphire expects to finance its cash needs through collaborations, strategic alliances and licensing arrangements and may finance its cash needs through a combination of equity and debt financings. Gemphire does not have any committed external source of funds beyond the upfront gross payment of $2.5 million due from Beijing SL under the Beijing SL License Agreement and there can be no assurance that Gemphire will be successful in acquiring additional funding at levels sufficient to fund its operations or lift the partial clinical hold.

        As a result, Gemphire's development activities are focused solely on completing its obligations under the CVR Agreement. NeuroBo (as successor in interest to Gemphire) has agreed to commit $1 million to support the further development of gemcabene through the Covenant End Date, to be funded following execution of the Beijing SL License Agreement and the receipt by Gemphire of the $2.5 million upfront gross payment payable under the Beijing SL License Agreement. Following the Effective Time of the merger, pursuant to the CVR Agreement, neither Gemphire nor NeuroBo will have any obligation to develop gemcabene, or to expend any funds or efforts with respect to gemcabene, other than the $1 million payment, to fund, (i) a toxicity study, (ii) a related FDA submission designed to result in the release of the partial clinical hold with respect to gemcabene, (iii) preparation for an end-of-phase 2 meeting with the FDA, and (iv) consulting costs for up to four

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Gemphire employees to support such activities. The expected cost of such activities is based on estimates and assumptions that may prove to be untrue. If $1 million is insufficient to fund the matters set forth above, neither Gemphire nor NeuroBo will have any obligation to provide further funding. If the merger is not completed and Gemphire is unable to raise sufficient additional funds for the development of gemcabene, whether through potential collaborative, partnering or other strategic arrangements or otherwise, or if Gemphire otherwise determines to discontinue the development of gemcabene, Gemphire will likely determine to cease operations.

        Even if Gemphire were to obtain funding to advance the development of gemcabene, the research, testing, manufacturing, labeling, approval, sale, marketing and distribution of a drug product are subject to extensive regulation by the FDA and other regulatory authorities in the United States and other countries, where regulations differ from country to country. Gemphire is not permitted to market gemcabene in the United States until it receives approval of a new drug application (NDA) from the FDA or in any foreign countries until it receives the requisite approval from such countries. Gemphire has not submitted an NDA to the FDA or comparable applications to other regulatory authorities or received marketing approval for gemcabene. Before obtaining regulatory approval for the commercial sale of gemcabene for a particular indication, Gemphire must demonstrate through preclinical testing and clinical trials that gemcabene is safe and effective for use in that target indication. This process can take many years and may be followed by post-marketing studies and surveillance, which will require the expenditure of substantial resources beyond Gemphire's current cash and cash equivalents. Of the large number of drugs in development in the United States, only a small percentage of drugs successfully complete the FDA regulatory approval process and are commercialized. Accordingly, even if Gemphire is able to complete development of gemcabene, Gemphire cannot assure you that gemcabene will be approved or commercialized.

The FDA has imposed a partial clinical hold on the clinical development of gemcabene which limits human trials to 6 months of drug exposure, and this partial clinical hold has, and may continue to, significantly delay Gemphire's expected initiation of Phase 3 trials, or, if never lifted, may prevent Gemphire from continuing the development of gemcabene.

        In August 2018 Gemphire announced that the FDA, following submission of its two-year carcinogenicity study, requested additional preclinical studies, including a 13 week PPAR-alpha knockout mouse study with gemcabene. The FDA stated that Gemphire cannot proceed to its EOP2 meeting or begin its Phase 3 trials, which require more than 6 months of drug exposure, until this partial clinical hold is lifted. This request has delayed the timeline for Gemphire's EOP2 meeting and start of Phase 3 trials by more than one year. Gemphire is currently conducting all studies requested to resubmit its application to the FDA to lift the clinical hold. However, Gemphire does not have any committed external source of funds beyond the upfront gross payment of $2.5 million due from Beijing SL under the Beijing SL License Agreement, which may be insufficient to lift the partial clinical hold and continue the development of gemcabene. If Gemphire is unable to raise additional funds through equity or debt financings or through collaborations, strategic alliances or licensing arrangements when needed or if the proposed merger is not consummated, Gemphire may be unable to complete the additional preclinical studies needed to lift the partial clinical hold, delay, scale back or discontinue the development of gemcabene or be required to significantly reduce or terminate its operations.

        Even if Gemphire were to obtain funding to complete the preclinical studies needed to lift the partial clinical hold, Gemphire cannot assure you that the studies will be completed on time by third party vendors who are involved or that the results will prove satisfactory for the FDA to lift the hold. It is possible that the FDA may request additional studies and information prior to lifting the hold which would significantly delay the time and cost to initiating Phase 3 trials and future development of gemcabene. If the FDA decisions further delay or increase the costs of Gemphire's clinical plans, this could jeopardize Gemphire's ability to commercialize gemcabene by April 2024, as required by the Pfizer Agreement. Finally, Gemphire cannot assure you that the partial clinical hold will ever be lifted in which case gemcabene will never receive NDA approval or be commercialized.

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Gemphire's Phase 2a clinical trial of gemcabene in Pediatric NAFLD was terminated by the Data and Safety Monitoring Board (DSMB) of the principal investigator following the occurrence of unanticipated problems. This trial termination and the unanticipated problems could have negative impacts on the clinical development of gemcabene.

        Gemphire announced on August 10, 2018 that the DSMB at Emory University School of Medicine overseeing the investigator-led open label Phase 2a proof-of-concept trial evaluating gemcabene in pediatric patients with non-alcoholic fatty liver disease (NAFLD) recommended that the trial be terminated due to unanticipated problems. Data on the first three patients who underwent 12 weeks of treatment showed that all three experienced an increase in liver fat content, as measured by MRI-PDFF. Two of the three patients also demonstrated increases in ALT; however, their baseline ALT levels were elevated prior to receiving gemcabene. The increase in liver fat was deemed an unanticipated problem by the trial investigator because it was an unexpected consistent pattern of worsening of the disease, rather than improvement, creating risk to the patients, which the investigator believed was likely due to the drug. Additional data that has come to light subsequently showed that during the trial the patients were not fully compliant with taking gemcabene and their life styles could have potentially impacted the findings. In addition to the first three patients, another three patients enrolled in the trial were taken off gemcabene and early termination visits were conducted. The DSMB recommended additional follow-up of the study subjects to gather additional safety data and this activity remains underway. The DSMB will provide Gemphire with a written report of their findings in the future, likely the second half of 2019, once all the patient results have been collated and analyzed.

        Gemphire intends to work closely with the physicians at the clinical trial site, and other KOLs to analyze all of the results and identify potential reasons for these unanticipated problems in the pediatric NAFLD study but cannot assure you that it will be able to determine the reasons for the unanticipated problems.

        Following the termination of the pediatric NAFLD trial in August 2018, the investigator of the ongoing Phase 2a FPL study conducted interim analyses of the patients enrolled at that point in her trial including MRI-PDFF scans and looking for signs of undesirable side effects before continuing the study. In consultation with her DSMB the principal investigator decided to continue the FPL study and completed enrollment in fourth quarter of 2018. Top-line results were reported in June 2019.

        Gemphire cannot assure you that the unanticipated problems observed in the pediatric NAFLD trial will not be seen in the FPL or future trials or that serious adverse events (SAEs) will not occur in future trials. Gemphire also cannot assure you that the unanticipated problems observed in the pediatric NAFLD trial will not result in the FDA or other regulatory authorities requesting additional analyses of Gemphire's previously completed clinical trials, including the three Phase 2b trials in dyslipidemia completed in 2017 and 2018.

        If gemcabene is associated with adverse effects or undesirable side effects in preclinical testing or clinical trials or has characteristics that are unexpected in preclinical testing or clinical trials, gemcabene could be less attractive to potential collaborators. Gemphire does not expect that gemcabene will continue to be developed other than through collaborations, strategic alliances and licensing arrangements.

Obtaining approval of an NDA is an extensive, lengthy, expensive and uncertain process, and the FDA may delay, limit or deny approval of gemcabene for many reasons, including:

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The results of previous clinical trials may not be predictive of future results, and the results of Gemphire's current clinical trials if funded in the future may not satisfy the requirements of the FDA or non-U.S. regulatory authorities.

        Significant additional clinical development, financial resources and personnel would be required to obtain necessary regulatory approvals for gemcabene and to develop it into a commercially viable product. Preclinical and clinical testing is expensive, can take many years to complete and has an uncertain outcome. The results from the prior preclinical studies and clinical trials for gemcabene discussed elsewhere in this proxy statement/prospectus/information statement may not necessarily be predictive of the results of future preclinical studies or clinical trials. Many companies in the pharmaceutical and biotechnology industries (including those with greater resources and experience than Gemphire) have suffered significant setbacks in late-stage clinical trials after achieving positive results in early stage development, and Gemphire cannot be certain that gemcabene will not face similar setbacks. These setbacks have been caused by, among other things, preclinical findings made while clinical trials were underway or safety or efficacy observations made in clinical trials, including previously unreported AEs. Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that believed their product candidates performed satisfactorily in preclinical studies and clinical trials nonetheless have failed to obtain FDA approval. If any future clinical trials of gemcabene fail to produce positive results, the development timeline and regulatory approval and commercialization prospects for gemcabene and its business and financial prospects, would be adversely affected.

        Further, gemcabene may not be approved even if Phase 3 registration trials are pursued and completed and it achieves its primary endpoint in such trials. The FDA or non-U.S. regulatory authorities may disagree with the trial design and its interpretation of data from preclinical studies and clinical trials. In addition, any of these regulatory authorities may change requirements for the approval of a product candidate even after reviewing and providing comments or advice on a protocol for a pivotal clinical trial that has the potential to result in approval by the FDA or another regulatory

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authority. Furthermore, any of these regulatory authorities may also approve a product candidate for fewer or more limited indications than it requests or may grant approval contingent on the performance of costly post-marketing clinical trials. In addition, before obtaining regulatory approvals for the commercial sale of any product candidate for any target indication, Gemphire must demonstrate with substantial evidence gathered in preclinical studies and adequate and well-controlled clinical studies, and, with respect to approval in the United States, to the satisfaction of the FDA, that the product candidate is safe and effective for use for that target indication.

        On July 23, 2019, Gemphire entered into the Beijing SL License Agreement with Beijing SL pursuant to which Gemphire granted Beijing SL an exclusive royalty-bearing license to research, develop, manufacture and commercialize pharmaceutical products comprising, as an active ingredient, gemcabene in the Territory. Under the terms of the Beijing SL License Agreement, Beijing SL will be responsible, at its expense, for developing and commercializing products containing gemcabene in the Territory, with certain assistance from Gemphire. Gemphire cannot assure you that the FDA or non-U.S. regulatory authorities or regulatory authorities in the Territory would consider Gemphire's planned clinical trials to be sufficient to serve as the basis for approval of gemcabene for any indication. The FDA and non-U.S. regulatory authorities retain broad discretion in evaluating the results of Gemphire's clinical trials and in determining whether the results demonstrate that gemcabene is safe and effective. If Gemphire or Beijing SL is required to conduct clinical trials of gemcabene in addition to those planned prior to approval, such as a cardiovascular outcomes trial, substantial additional funds will be needed, gemcabene's development pathway will be delayed, and Gemphire cannot assure you that the results of any such outcomes trial or other clinical trials will be sufficient for approval.

If clinical trials of gemcabene or any future product candidate, if funded and pursued, fail to demonstrate safety and efficacy to the satisfaction of regulatory authorities or do not otherwise produce positive results, Gemphire or a potential collaborator, such as Beijing SL, may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of such product candidate.

        Before obtaining marketing approval from regulatory authorities for the sale of gemcabene, Gemphire must complete preclinical development (including, but not limited to, a subchronic (13 week) study of gemcabene in PPARa knock-out mice and a study of gemcabene in in vitro PPAR transactivation assays using monkey and canine PPAR isoforms), and supportive pharmacology studies and Phase 2 and Phase 3 clinical trials to demonstrate the safety and efficacy in humans. Clinical testing is expensive, difficult to design and implement, can take many years to complete and is uncertain as to outcome. A failure of one or more clinical trials can occur at any stage of development.

        Gemphire or a potential collaborator, may experience numerous unforeseen events during, or as a result of, clinical trials that could result in increased development costs, delay, limit or prevent gemcabene or other product candidate that may be pursued in the future from receiving marketing approval or being commercialized, including:

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If Gemphire or a potential collaborator, such as Beijing SL, experiences delays or difficulties in the enrollment of patients in clinical trials, its receipt of necessary regulatory approvals could be delayed or prevented.

        Gemphire or its future collaborators may not be able to initiate or continue clinical trials for gemcabene or any future product candidate if Gemphire is unable to locate and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or analogous regulatory authorities outside the United States. Orphan indications, in particular, have small populations, and it may be difficult for Gemphire to locate and enroll sufficient patients in trials for orphan-designated indications. Patient enrollment can be affected by many factors, including:

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        Two investigator-initiated Phase 2a clinical trials of gemcabene commenced in late 2017 or early 2018. The pediatric NAFLD trial was terminated prematurely in the third quarter of 2018 and treatments were stopped after only 6 patients had been enrolled due to "unanticipated problems" (see details above). The patients will continue to be followed by the investigator and final results are expected to become available in the second half of 2019 from the investigator. In the Phase 2a adult FPL trial, patient enrollment was completed in fourth quarter 2018 and topline data was reported in June 2019 from the principal investigator. Gemphire's inability to fully enroll and complete the pediatric NAFLD trial will likely have an impact on Gemphire's future plans in this patient population including potentially abandoning additional trials altogether. In addition, if unforeseen events arise in the adult FPL trial, if a regulatory authority believes that the unanticipated problems observed in the NAFLD trial or other events constitute an adverse effect caused by gemcabene, or if other effects are identified during clinical trials that Gemphire or any potential collaborators may conduct in the future:

        Any of these events could cause significant delays or may require Gemphire to abandon future clinical trials altogether. Further delays in Gemphire's clinical trials or modifications to any future trial plans may result in additional increased development costs for gemcabene and cause Gemphire's stock price to decline.

Gemphire or others could discover that gemcabene or any product candidate Gemphire may pursue in the future lacks sufficient efficacy, or that it causes undesirable side effects that were not previously identified, which could delay or prevent regulatory approval or commercialization.

        Because gemcabene has been tested in relatively small patient populations and for limited durations to date, it is possible that Gemphire's clinical trials have or will indicate an apparent positive effect of gemcabene that is greater than the actual positive effect, if any, or that additional and unforeseen side effects may be observed as its development progresses. The discovery that gemcabene lacks sufficient efficacy, or that it causes undesirable side effects, including side effects not previously identified in Gemphire's previously completed clinical trials, such as the unanticipated problems that occurred in connection with the pediatric NAFLD study, could cause Gemphire or regulatory authorities to interrupt, delay or discontinue clinical trials and could result in the denial of regulatory approval by the FDA or other non-U.S. regulatory authorities for any or all targeted indications. See "—Gemphire's Phase 2a clinical trial of gemcabene in Pediatric NAFLD was terminated by the Data and Safety Monitoring Board (DSMB) of the principal investigator following the occurrence of unanticipated problems. This trial termination and the unanticipated problems could have negative impacts on the clinical development of gemcabene" above. Across all human trials conducted to date, the most common adverse events reported have been headache, weakness, nausea, dizziness, upset stomach, infection, abnormal bowel movements, myalgia and abnormal kidney function tests.

        The discovery that gemcabene lacks sufficient efficacy or that it causes undesirable side effects that were not previously identified could delay or prevent regulatory approval and prevent Gemphire from commercializing such product candidate and generating revenues from its sale. In addition, if Gemphire

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or potential collaborator receives marketing approval for gemcabene and Gemphire or others later discover that it is less effective, or identify undesirable side effects caused by gemcabene:

        Any one or a combination of these events could prevent Gemphire from achieving or maintaining market acceptance of the affected product or could substantially increase the costs and expenses of commercializing the product, which in turn could delay or prevent Gemphire from generating significant, or any, revenues from the sale of the product.

Gemphire depends on intellectual property licensed from Pfizer for gemcabene, and the termination of this license would harm Gemphire's business, and if the merger is completed, the CVR holders may not receive any proceeds from gemcabene.

        Pfizer granted Gemphire a worldwide exclusive license to certain patent rights and a non-exclusive royalty bearing right and license to certain related data to make, use, develop, commercialize, import and otherwise exploit the clinical product candidate gemcabene. Under the license agreement, as amended and restated in August 2018, either party may terminate the license agreement for the other party's material breach following a cure period or immediately upon certain insolvency events relating to the other party. Pfizer may immediately terminate the license agreement in the event that (i) Gemphire or any of its affiliates or sublicensees contests or challenges, or supports or assists any third party to contest or challenge, Pfizer's ownership of or rights in, or the validity, enforceability or scope of, any of the patents licensed under the license agreement or (ii) Gemphire or any of its affiliates or sublicensees fails to achieve the first commercial sale in at least one country by April 16, 2024. Furthermore, upon termination of the license agreement by Pfizer for any of the foregoing reasons, Gemphire grants Pfizer, pursuant to the license agreement, a non-exclusive, fully paid-up, royalty free, worldwide, transferrable, perpetual and irrevocable license to use any intellectual property rights arising from the development or commercialization of gemcabene by Gemphire and any trademarks identifying gemcabene and agree to transfer regulatory filings and approvals to Pfizer or permit Pfizer to cross-reference and rely on such regulatory filings and approvals for gemcabene.

        Disputes may arise between Gemphire and Pfizer regarding intellectual property subject to this license agreement, including with respect to:

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        Any disputes with Pfizer may prevent or impair Gemphire's ability to maintain its current licensing arrangement. Gemphire depends on the intellectual property and the historical preclinical and clinical data package licensed from Pfizer to develop and commercialize gemcabene. Termination of Gemphire's license agreement could result in the loss of significant rights and would harm its ability to further develop and commercialize gemcabene. In addition, Pfizer retains the right to make, use and import gemcabene solely for internal research purposes.

        In addition, if the merger is completed and the combined company breaches its obligations under the license agreement, resulting in a termination of the agreement, then the combined company may not receive proceeds from the transfer of rights to gemcabene. If the combined company does not receive any such proceeds, then the CVR holders would not receive any payments on the CVR.

Beijing SL has exclusive rights for the development and commercialization of gemcabene in mainland China, Hong Kong, Macau and Taiwan (collectively, the "Territory"). Beijing SL's failure to timely develop or commercialize gemcabene would have a material adverse effect on Gemphire's business and operating results.

        Gemphire granted Beijing SL an exclusive royalty-bearing license to research, develop, manufacture and commercialize pharmaceutical products comprising, as an active ingredient, gemcabene, in the Territory, subject to certain rights that Gemphire retained in the Territory. The collaboration with Beijing SL may not be successful due to several factors, including the following:

        In addition, Gemphire could be adversely affected by:

        Any of the foregoing could adversely impact the likelihood and timing of any milestone or royalty payments Gemphire is eligible to receive under the Beijing SL License Agreement and could result in a material adverse effect on its business, results of operations and prospects and would likely cause its stock price to decline.

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Risks Related to Government Regulation

Gemcabene is subject to a partial clinical hold with respect to clinical trials of longer than six months in duration until the FDA determines to release such hold, which may lead to a significant delay in the commencement of long-term clinical trials by Gemphire or any potential collaborators or the failure of gemcabene to obtain marketing approval.

        In 2004, the FDA determined that gemcabene was a potential peroxisome proliferator-activated receptor (PPAR) agonist. As a result, the FDA imposed a partial clinical hold, which restricts Gemphire from conducting clinical trials for gemcabene beyond six months in duration and required Gemphire to conduct two-year rat and mouse carcinogenicity studies. The FDA has issued these notices to all sponsors of product candidates with PPAR properties based on preclinical studies. Gemphire submitted the results of its two-year rat and mouse carcinogenicity studies to the FDA, together with results from a short-term, 8 day study where, in PPAR-a knockout mice, gemcabene did not induce known markers of peroxisome proliferation, providing evidence that gemcabene works through PPAR-a. In response the FDA has requested that, as part of a complete response, Gemphire provide additional data including a subchronic (13 week) study in PPAR-a knock-out mice and PPAR transactivation assays using monkey and canine PPAR isoforms, to further understand the human relevance of the preclinical findings. Gemphire completed the in vitro PPAR-a transactivation study, and Gemphire has initiated the CRO-related activities to conduct the PPAR-a knockout mouse study. Gemphire expects to submit the request to the FDA to lift the partial clinical hold in the fourth quarter of 2019.

        The future clinical development of gemcabene may be delayed due to these clinical restrictions and additional oversight by the FDA, as occurred when the FDA requested the additional data beyond the results of Gemphire's two-year rat and mouse carcinogenicity studies. If the results of the subchronic (13 week) study in PPAR-a knock-out mice and the PPAR transactivation assays using monkey and canine PPAR isoforms do not address FDA concerns related to the partial clinical hold, Gemphire's Phase 3 long-term safety exposure registration trials of longer than six months could be further delayed or the FDA may never release the partial clinical hold. Also, the findings in Gemphire's preclinical studies could impact the NDA review, and, if approved, labeling and use of gemcabene.

        The completion of any additional studies requested by the FDA and the future clinical development of gemcabene is dependent on Gemphire obtaining additional funding. Gemphire does not have any committed external source of funds beyond the upfront gross payment of $2.5 million due from Beijing SL under the Beijing SL License Agreement and there can be no assurance that Gemphire will be successful in acquiring additional funding at levels sufficient to fund its operations. NeuroBo (as successor in interest to Gemphire) has agreed to commit $1 million to support the further development of gemcabene through the Covenant End Date, to be funded following execution of the Beijing SL License Agreement and the receipt by Gemphire of the $2.5 million upfront gross payment payable under the Beijing SL License Agreement. Following the Effective Time of the merger, neither Gemphire nor NeuroBo will have any obligation to develop gemcabene, or to expend any funds or efforts with respect to gemcabene, other than the $1 million payment, to fund, (i) a toxicity study, (ii) a related FDA submission designed to result in the release of the partial clinical hold with respect to gemcabene, (iii) preparation for an end-of-phase 2 meeting with the FDA, and (iv) consulting costs for up to four of Gemphire's employees to support such activities. The expected cost of such activities is based on estimates and assumptions that may prove to be untrue. If $1 million is insufficient to fund the matters set forth above, neither Gemphire nor NeuroBo will have any obligation to provide further funding. Gemphire has no other obligation to support the development of gemcabene, including to release the partial clinical hold.

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Gemphire or any potential collaborator may never receive regulatory approval to market gemcabene outside of the United States.

        The activities associated with the development and commercialization of product candidates are subject to comprehensive regulation by the FDA, other regulatory agencies in the United States and by comparable authorities in other countries. Failure to obtain regulatory approval for gemcabene will prevent Gemphire or any potential collaborator from commercializing gemcabene. Gemphire has not received regulatory approval to market gemcabene in any jurisdiction, and it does not expect to obtain FDA or any other regulatory approvals to market gemcabene for the foreseeable future, if at all. The process of obtaining regulatory approvals is expensive, often takes many years, if approval is obtained at all, and can vary substantially based upon the type, complexity and novelty of the product candidates involved.

        Changes in the regulatory approval policy during the development period, changes in or the enactment of additional regulations or statutes, or changes in regulatory review for a submitted product application may cause delays in the approval or rejection of an application. Even if the FDA or another regulatory authority approves a product candidate, the approval may impose significant restrictions on the indicated uses, conditions for use, labeling, advertising, promotion, marketing and/or production of such product, and may impose ongoing requirements for post-approval studies, including additional research and development and clinical trials. Any FDA approval may also impose Risk Evaluation Mitigation Strategy ("REMS") on a product if the FDA believes there is a reason to monitor the safety of the drug in the market place. REMS may include requirements for additional training for health care professionals, safety communication efforts and limits on channels of distribution, among other things. The sponsor would be required to evaluate and monitor the various REMS activities and adjust them if need be. The FDA and other regulatory authorities also may impose various civil or criminal sanctions for failure to comply with regulatory requirements, including withdrawal of product approval.

        Furthermore, the approval procedure and the time required to obtain approval varies among countries and can involve additional testing beyond that required by the FDA. Approval by one regulatory authority does not ensure approval by regulatory authorities in other jurisdictions. Failure to obtain approval in one jurisdiction may negatively impact Gemphire's ability to obtain approval elsewhere.

        The FDA and foreign regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may decide that Gemphire's data is insufficient for approval and require additional preclinical, clinical or other studies, including Phase 4 clinical studies. In addition, varying interpretations of the data obtained from preclinical and clinical testing could delay, limit, or prevent regulatory approval of a product candidate. Even if Gemphire submits an application to the FDA and foreign regulatory authorities for marketing approval of gemcabene, it may not result in any marketing approvals.

        Gemphire does not expect to receive regulatory approval for the commercial sale of gemcabene for the foreseeable future, including through a potential collaborator, if at all. The inability to obtain approval from the FDA or foreign regulatory authorities for gemcabene would prevent Gemphire or any potential collaborators from commercializing gemcabene in the United States or other countries. See the section entitled "Gemphire Business—Government Regulation" in this proxy statement/prospectus/information statement for additional information regarding risks associated with marketing approval, as well as risks related to potential post-approval requirements.

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Gemphire may seek to avail itself of mechanisms to expedite and/or reduce the cost for development or approval of gemcabene or any other product candidate it may pursue in the future, such as fast track designation or Orphan Drug designation, but such mechanisms may not actually lead to a faster or less expensive development or regulatory review or approval process.

        Gemphire may seek fast track designation, priority review, Orphan Drug designation, or accelerated approval for gemcabene or any other product candidate Gemphire may pursue in the future. For example, if a drug is intended for the treatment of a serious or life-threatening condition and the drug demonstrates the potential to address unmet medical needs for this condition, the drug sponsor may apply for FDA fast track designation. However, the FDA has broad discretion with regard to these mechanisms, and even if Gemphire believes a particular product candidate is eligible for any such mechanism, it cannot assure you that the FDA would decide to grant it. Even if Gemphire does obtain fast track or priority review designation or pursue an accelerated approval pathway, it may not experience a faster and/or less costly development process, review or approval compared to conventional FDA procedures. The FDA may withdraw a particular designation if it believes that the designation is no longer supported by data from Gemphire's clinical development program.

A breakthrough therapy designation by the FDA for a product candidate may not lead to a faster development or regulatory review or approval process, and it may not increase the likelihood that a product candidate will receive marketing approval.

        Depending on the results of Gemphire's clinical trials, Gemphire may seek a breakthrough therapy designation for gemcabene or any other product candidate it may pursue in the future. A breakthrough therapy is defined as a drug that is intended, alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition, and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints. For drugs that are designated as breakthrough therapies, interaction and communication between the FDA and the sponsor can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens.

        Designation as a breakthrough therapy is within the discretion of the FDA. Accordingly, even if Gemphire believes a product candidate meets the criteria for designation as a breakthrough therapy, the FDA may disagree and instead determine not to make such designation. Gemphire cannot be sure that its evaluation of a product candidate as qualifying for breakthrough therapy designation will meet the FDA's requirements. In any event, the receipt of a breakthrough therapy designation for a product candidate may not result in a faster development process, review or approval compared to conventional FDA procedures and does not assure ultimate approval by the FDA. In addition, even if one or more product candidates qualifies as a breakthrough therapy, the FDA may later decide that the product no longer meets the conditions for qualification or the time period for FDA review or approval will not be shortened.

The uncertainty associated with pharmaceutical reimbursement and related matters may increase the difficulty and cost for Gemphire and its future collaborators to obtain marketing approval of Gemphire's product candidate and affect its pricing.

        In the United States and some foreign jurisdictions, there have been a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could prevent or delay marketing approval of a product candidate, restrict or regulate post-approval activities and affect Gemphire's ability, or the ability of Gemphire's future collaborators, to profitably sell any drug for which Gemphire, or they, obtain marketing approval. Gemphire expects that current laws, as well as other healthcare reform measures that may be adopted in the future, may result in more rigorous coverage criteria and cause downward pressure on the price that Gemphire, or its future collaborators, may receive for any approved drug.

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        For example, in March 2010, President Obama signed into law the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (collectively, the PPACA). This is a sweeping law intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, improve healthcare quality, enhance remedies against fraud and abuse, add new transparency requirements for certain components of the health care and health insurance industries, impose new taxes and fees on the health industry and impose additional health policy reforms. Among the provisions of the PPACA of importance to gemcabene and any future product candidates are:

        There have been judicial and Congressional challenges and amendments to certain aspects of the PPACA, and Gemphire expects there will be additional challenges and amendments to, and attempts to repeal, the PPACA in the future. In addition, other legislative changes have been proposed and adopted since the PPACA was enacted. These new laws have resulted in additional reductions in Medicare and other healthcare funding and otherwise may affect the prices Gemphire may obtain for any product candidate for which marketing approval is obtained. Any reduction in reimbursement from Medicare or other government-funded programs may result in a similar reduction in payments from private payors. Moreover, recently there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products. The implementation of cost containment measures or other healthcare reforms may prevent Gemphire from being able to generate revenue, attain profitability or commercialize its drugs.

        Legislative and regulatory proposals have been made to expand post-approval requirements and restrict sales and promotional activities for pharmaceutical products. Gemphire cannot be sure whether additional legislative changes will be enacted, or whether the FDA regulations, guidance or interpretations will be changed, or what the impact of such changes on the marketing approvals of a product candidate, if any, may be. In addition, increased scrutiny by the U.S. Congress of the FDA's approval process may significantly delay or prevent marketing approval, as well as subject Gemphire

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and its future collaborators to more stringent drug labeling and post-marketing testing and other requirements.

Governments outside of the United States tend to impose strict price controls, which may adversely affect Gemphire's revenues from the sales of a drug, if any.

        In some countries, particularly the countries of the European Union, the pricing of prescription pharmaceuticals is subject to governmental control. In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a drug. To obtain reimbursement or pricing approval in some countries, Gemphire, or its future collaborators, may be required to conduct a clinical trial that compares the cost-effectiveness of its drug to other available therapies. If reimbursement of Gemphire's drug is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, its business could be harmed.

Gemphire's relationships with healthcare providers and third-party payors will be subject to applicable fraud and abuse and other healthcare laws and regulations, which could expose it to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings, among other penalties and consequences.

        Healthcare providers and third-party payors will play a primary role in the recommendation and prescription of any product candidate for which Gemphire obtains marketing approval. Gemphire's current and future arrangements with third-party payors and customers may expose it to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which it markets, sells and distributes any product candidate for which Gemphire obtains marketing approval. Restrictions and obligations under applicable federal and state healthcare laws and regulations include the following:

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        Efforts to ensure that Gemphire's current and future business arrangements with third parties will comply with applicable healthcare laws and regulations will involve substantial costs. It is possible that governmental authorities will conclude that Gemphire's business practices may not comply with current or future statutes, regulations or case law involving applicable fraud and abuse or other healthcare laws and regulations. If Gemphire's operations are found to be in violation of any of these laws or any other governmental regulations that may apply to it, Gemphire may be subject to significant civil, criminal and administrative penalties, damages, fines, exclusion from government funded healthcare programs, such as Medicare and Medicaid, disgorgement, individual imprisonment, contractual damages, reputational harm, diminished profits and future earnings, and the curtailment or restructuring of its operations. If any of the physicians or other providers or entities with whom Gemphire expects to do business is found to not be in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs. Defending against any such actions can be costly, time-consuming and may require significant financial and personnel resources. Therefore, even if Gemphire is successful in defending against any such actions that may be brought against it, its business may be impaired.

Gemphire is subject to U.S. and certain foreign export and import controls, sanctions, embargoes, anti-corruption laws, and anti-money laundering laws and regulations. Compliance with these legal standards could impair its ability to compete in domestic and international markets. Gemphire can face criminal liability and other serious consequences for violations which can harm its business.

        Gemphire is subject to export control and import laws and regulations, including the U.S. Export Administration Regulations, U.S. Customs regulations, various economic and trade sanctions regulations administered by the U.S. Treasury Department's Office of Foreign Assets Controls, the U.S. Foreign Corrupt Practices Act of 1977, as amended, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, the USA PATRIOT Act, and other state and national anti-bribery and anti-money laundering laws in the countries in which it conducts activities. Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, contractors, and other partners from authorizing, promising, offering, or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or private sector. Gemphire may engage third parties for clinical trials outside of the United States, to sell its products abroad once Gemphire enters a commercialization phase, and/or to obtain necessary permits, licenses, patent registrations, and other regulatory approvals. Gemphire has direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals, universities, and other organizations. Gemphire can be held liable for the corrupt or other illegal activities of its employees, agents, contractors, and other partners, even if it does not explicitly authorize or have actual knowledge of such activities. Gemphire's violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences.

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Gemphire's employees may engage in misconduct or other improper activities, including violating applicable regulatory standards and requirements or engaging in insider trading, which could significantly harm its business.

        Gemphire is exposed to the risk of employee fraud or other misconduct. Misconduct by employees could include intentional failures to comply with the regulations of the FDA and applicable non-U.S. regulators, provide accurate information to the FDA and applicable non-U.S. regulators, comply with healthcare fraud and abuse laws and regulations in the United States and abroad, report financial information or data accurately or disclose unauthorized activities to Gemphire. In particular, sales, marketing and business arrangements in the healthcare industry are subject to extensive laws and regulations intended to prevent fraud, misconduct, kickbacks, self-dealing and other abusive practices. These laws and regulations restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements. Employee misconduct could also involve the improper use of, including trading on, information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to Gemphire's reputation. It is not always possible to identify and deter employee misconduct, and the precautions it takes to detect and prevent this activity may be ineffective in controlling unknown or unmanaged risks or losses or in protecting it from governmental investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations. If any such actions are instituted against Gemphire, and it is not successful in defending itself or asserting its rights, those actions could have a significant impact on its business, including the imposition of significant civil, criminal and administrative penalties, damages, fines, exclusion from government funded healthcare programs such as Medicare and Medicaid, disgorgement, individual imprisonment, contractual damages, reputational harm, diminished profits and future earnings, and the curtailment or restructuring of Gemphire's operations.

The FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses. If Gemphire is found to have improperly promoted off-label uses, it may become subject to significant liability.

        The FDA and other regulatory agencies strictly regulate the promotional claims that may be made about prescription products, such as gemcabene, if approved. In particular, a product may not be promoted for uses that are not approved by the FDA or such other regulatory agencies as reflected in the product's approved labeling. If Gemphire receives marketing approval for gemcabene or any future product candidate for a certain indication, physicians may nevertheless prescribe gemcabene or such future product candidate to their patients in a manner that is inconsistent with the approved label. If Gemphire is found to have promoted such off-label uses, it may become subject to significant liability. The federal government has levied large civil and criminal fines against companies for alleged improper promotion and has enjoined several companies from engaging in off-label promotion. The FDA has also requested that companies enter into consent decrees or permanent injunctions under which specified promotional conduct is changed or curtailed. If Gemphire cannot successfully manage the promotion of gemcabene or any future product candidate, if approved, it could become subject to significant liability, which would adversely affect its business and financial condition.

Tax matters, including the changes in corporate tax rates, disagreements with taxing authorities and imposition of new taxes could impact Gemphire's results of operations and financial condition.

        Gemphire is subject to income and other taxes in the U.S. and its operations, plans and results are affected by tax and other initiatives. On December 22, 2017, comprehensive changes to the Code were signed into law, informally titled the Tax Cuts and Jobs Act (the "Tax Act"). The Tax Act included significant changes that could materially impact the taxation of corporations such as Gemphire, including among other things, changes to the corporate income tax rate, limitation of the tax deduction

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for interest expense to business interest income plus 30% of adjusted taxable income (except for certain small businesses), limitation of the deduction for net operating losses ("NOLs") generated in tax years beginning after December 31, 2017 to 80% of current year taxable income and the general elimination of carrybacks of NOLs generated in taxable years ending after December 31, 2017, immediate deductions for certain new investments instead of deductions for depreciation expense over time, and modifying or repealing many business deductions and credits (including changes to the orphan drug tax credit and changes to the deductibility of research and experimental expenditures that will be effective in the future). Notwithstanding the reduction in the corporate income tax rate, the overall impact of the Tax Act and any future tax reform is uncertain and Gemphire's business and financial condition could be adversely affected. The impact of the Tax Act and any future tax reform on holders of Gemphire common stock is likewise uncertain and could be adverse.

        Gemphire is also subject to regular reviews, examinations, and audits by the IRS and other taxing authorities with respect to its taxes. Although it believes its tax estimates are reasonable, if a taxing authority disagrees with the positions it has taken, it could face additional tax liability, including interest and penalties. There can be no assurance that payment of such additional amounts upon final adjudication of any disputes will not have a material impact on its results of operations and financial position.

        Gemphire also needs to comply with new, evolving or revised tax laws and regulations. The enactment of or increases in tariffs, or other changes in the application or interpretation of the Tax Act, or on specific products that it may ultimately sell or with which its products compete, may have an adverse effect on Gemphire's business or on its results of operations.

Inadequate funding for the FDA, the SEC and other government agencies could hinder their ability to perform normal business functions on which the operation of its business may rely, which could negatively impact Gemphire's business.

        The ability of the FDA to review and approve new products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes. Average review times at the FDA have fluctuated in recent years as a result. Disruptions at the FDA and other agencies may also slow the time necessary for new drugs to be reviewed and/or approved by necessary government agencies, which would adversely affect its business.

        In addition, government funding of the SEC and other government agencies on which its operations may rely is subject to the political process, which is inherently fluid and unpredictable. For example, over the last several years, including beginning on December 22, 2018, the U.S. government has shut down several times and certain regulatory agencies, such as the FDA and the SEC, have had to furlough critical FDA, SEC and other government employees and stop critical activities. If a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process Gemphire's regulatory submissions, which could have a material adverse effect on its business. Further, in Gemphire's operations as a public company, future government shutdowns could impact its ability to access the public markets and obtain necessary capital in order to properly capitalize and continue its operations.

Federal legislation and actions by state and local governments may permit reimportation of drugs from foreign countries into the United States, including foreign countries where the drugs are sold at lower prices than in the United States, which could adversely affect its operating results.

        Gemphire may face competition for gemcabene, if approved, from cheaper lipid-lowering therapies sourced from foreign countries that have placed price controls on pharmaceutical products. The Medicare Modernization Act contains provisions that may change U.S. importation laws and expand

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pharmacists' and wholesalers' ability to import cheaper versions of an approved drug and competing products from Canada, where there are government price controls. These changes to U.S. importation laws will not take effect unless and until the Secretary of Health and Human Services certifies that the changes will pose no additional risk to the public's health and safety and will result in a significant reduction in the cost of products to consumers. The Secretary of Health and Human Services has so far declined to approve a reimportation plan. Proponents of drug reimportation may attempt to pass legislation that would directly allow reimportation under certain circumstances. Legislation or regulations allowing the reimportation of drugs, if enacted, could decrease the price Gemphire receives for any product it may develop and adversely affect its future revenues and prospects for profitability.

Risks Related to the Commercialization of Gemcabene or Any Future Product Candidate

Gemphire faces substantial competition, which may result in others discovering, developing or commercializing products before or more successfully than Gemphire does.

        The development and commercialization of new drug products is highly competitive. Gemphire expects to face competition with respect to gemcabene, if approved, and will face competition with respect to any product candidates that Gemphire may seek to develop or commercialize in the future from major pharmaceutical companies, specialty pharmaceutical companies, biotechnology companies, universities and other research institutions and government agencies worldwide.

        The lipid-lowering therapies market is highly competitive and dynamic and dominated by the sale of statin treatments including the cheaper generic versions of statins. Gemphire's success will depend, in part, on its ability to obtain a share of the market for its planned indications. Other pharmaceutical companies may develop lipid-lowering therapies for the same indications that compete with gemcabene, if approved, that do not infringe the claims of Gemphire's patents, pending patent applications or other proprietary rights which could adversely affect its business and results of operations. Lipid-lowering therapies currently on the market that would compete with gemcabene, if approved, include the following:

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        Several other pharmaceutical companies have other lipid-lowering therapies in development that may be approved for marketing in the United States or outside of the United States. Based on publicly available information, Gemphire believes the current therapies in development that would compete with gemcabene include:

        This means that there is significant competition for investigational sites and patients to enroll in clinical studies. Additionally, since some drug candidates may be further along in development, approval of such drug candidates could lead to the FDA and other global health authorities to request and/or require changes to ongoing or future clinical trial designs that could impact timelines and cost.

        The biomarkers and pathogenesis of NASH are less understood than the dyslipidemia market and for that reason there are many mechanisms of action under investigation to better understand how to effectively treat the disease. Currently accepted diagnosis of NASH is confirmed through a liver biopsy which is invasive, time consuming and costly. Future growth and evolution of the NASH market may rely on development of less invasive technologies to increase diagnoses rates to broaden the drug treated patient population. Several companies have late stage assets (Phase 3 or outcomes studies) well under way with projected market approval dates in NASH as soon as 2019/2020. For NASH, the market is currently evolving with no approved therapies for the indication across the globe. Current thought leader opinions are pointing to a multiple mechanistic approach to effectively treat NASH.

        Several pharmaceutical companies have NASH therapies in development that may be approved for marketing in the United States or outside of the United States. Based on publicly available information, Gemphire believes the current therapies in development that would compete with gemcabene in NASH include but are not limited to:

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        Gemphire's competitors may develop products that are more effective, safer, more convenient or less costly than any that Gemphire is developing or that would render Gemphire's product candidates obsolete or non-competitive. Gemphire's competitors may also render its technologies obsolete by advances in existing technological approaches or the development of new or different approaches, potentially eliminating the advantages in its drug discovery process. Gemphire's competitors may also obtain marketing approval from the FDA or other regulatory authorities for their products more rapidly than it may obtain approval for Gemphire's, which could result in its competitors establishing a strong market position before it is able to enter the market.

        Many of Gemphire's competitors have significantly greater name recognition, financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than Gemphire does. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources being concentrated among a smaller number of Gemphire's competitors. Smaller and other early stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties compete with Gemphire in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites and patient registration for clinical trials and entering into strategic transactions, as well as in acquiring technologies complementary to, or necessary for, Gemphire's programs.

Gemphire lacks experience commercializing products, which may have an adverse effect on Gemphire's business.

        If gemcabene or any product candidate Gemphire may pursue in the future receives marketing approval, it will need to transition from a company with a development focus to a company capable of supporting commercial activities, and Gemphire may not be successful in making that transition. Gemphire has never filed an NDA, and has not yet demonstrated an ability to obtain marketing approval for, or to commercialize, any product candidate. As a result, Gemphire's clinical development and regulatory approval process, and its ability to successfully commercialize any approved products, may involve more inherent risk, take longer, and cost more than it would if it was a company with experience obtaining marketing approval for and commercializing a product candidate.

If Gemphire is unable to establish sales and marketing capabilities or enter into agreements with third parties to sell and market gemcabene, if approved, or any other product candidate it may pursue, it may not be successful in commercializing such product candidate if and when approved.

        Gemphire does not have a global sales or marketing infrastructure and has no capabilities in place at the present time for the sale, marketing or distribution of pharmaceutical products. To achieve commercial success for any approved product for which it retains sales and marketing responsibilities, Gemphire must either develop a sales and marketing organization or outsource part or all of these functions to other third parties.

        There are risks involved with both establishing Gemphire's own sales and marketing capabilities and entering into arrangements with third parties to perform these services. For example, recruiting

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and training a sales force is expensive and time consuming and could delay any product launch. If the commercial launch of a product candidate for which Gemphire recruits a sales force and establishes marketing capabilities is delayed or does not occur for any reason, Gemphire would have prematurely or unnecessarily incurred these commercialization expenses. This may be costly, and its investment would be lost if it cannot retain or reposition its sales and marketing personnel.

        Factors that may inhibit Gemphire's efforts to commercialize gemcabene or any future product candidate on its own include:

        If Gemphire enters into arrangements with third parties to perform sales, marketing and distribution services, its product revenues or the profitability of these product revenues to it are likely to be lower than if it was to market and sell a product that it develops itself. In addition, it may not be successful in entering into arrangements with third parties to sell and market any product candidate or may be unable to do so on terms that are favorable to it. It likely will have little control over such third parties, and any of them may fail to devote the necessary resources and attention to sell and market a drug effectively. If Gemphire does not establish sales and marketing capabilities successfully, either on its own or in collaboration with third parties, it will not be successful in commercializing gemcabene or any future product candidate.

Even if gemcabene or any future product candidate receives marketing approval, it may fail to achieve the degree of market acceptance by physicians, patients, healthcare payors and others in the medical community necessary for commercial success.

        Even if gemcabene or any future product candidate receives marketing approval, it may nonetheless fail to gain sufficient market acceptance by physicians, patients, healthcare payors and others in the medical community. If such product candidate does not achieve an adequate level of acceptance, it may not generate significant product revenues and it may not become profitable. The degree of market acceptance of a product candidate, if approved for commercial sale, will depend on a number of factors, including:

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If the FDA or a comparable foreign regulatory authority approves generic versions of gemcabene or any future product candidates that receive marketing approval, or such authorities do not grant its product candidates appropriate periods of data exclusivity before approving generic versions of its products, the sales of its products could be adversely affected.

        Once an NDA is approved, the product covered thereby becomes a "reference listed drug" in the FDA's publication, "Approved Drug Products with Therapeutic Equivalence Evaluations." Manufacturers may seek approval of generic versions of reference listed drugs through submission of abbreviated new drug applications (ANDAs) in the United States. In support of an ANDA, a generic manufacturer need not conduct clinical studies. Rather, the applicant generally must show that its product has the same active ingredient(s), dosage form, strength, route of administration and conditions of use or labeling as the reference listed drug and that the generic version is bioequivalent to the reference listed drug, meaning it is absorbed in the body at the same rate and to the same extent. Generic products may be significantly less costly to bring to market than the reference listed drug and companies that produce generic products are generally able to offer them at lower prices. Thus, following the introduction of a generic drug, a significant percentage of the sales of any branded product or reference listed drug may be typically lost to the generic product.

        The FDA may not approve an ANDA for a generic product until any applicable period of non-patent exclusivity for the reference listed drug has expired. The FDC Act provides a period of five years of non-patent exclusivity for a new drug containing a new chemical entity (NCE). Specifically, in cases where such exclusivity has been granted, an ANDA may not be filed with the FDA until the expiration of five years unless the submission is accompanied by a Paragraph IV certification that a patent covering the reference listed drug is either invalid or will not be infringed by the generic product, in which case the applicant may submit its application four years following approval of the reference listed drug. It is unclear whether the FDA will treat the active ingredients in Gemphire's product candidates as NCEs and, therefore, afford them five years of NCE data exclusivity if they are approved. If any product Gemphire develops does not receive five years of NCE exclusivity, it may nonetheless be eligible for three years of exclusivity, which means that the FDA may approve generic

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versions of such product three years after its date of approval. Manufacturers may seek to launch these generic products following the expiration of the applicable marketing exclusivity period, even if Gemphire still has patent protection for its product.

        Competition that gemcabene or any future product candidates may face from generic versions of Gemphire's products could materially and adversely impact its future revenue, profitability and cash flows and substantially limit its ability to obtain a return on the investments it has made in any such product candidate.

Even if Gemphire is able to commercialize a future product candidate, the profitability of such product candidate will likely depend in significant part on third-party reimbursement practices, which, if unfavorable, would harm its business.

        Gemphire's ability to commercialize a drug successfully will depend in part on the extent to which coverage and adequate reimbursement will be available from government health administration authorities, private health insurers and other organizations. Government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which medications they will pay for and establish reimbursement levels. Government authorities and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications. Increasingly, third-party payors are requiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products. Gemphire cannot be sure that coverage will be available for any product candidate that it commercializes and, if coverage is available, whether the level of reimbursement will be adequate. Assuming Gemphire obtains coverage for gemcabene, if approved, by a third-party payor, the resulting reimbursement payment rates may not be adequate or may require co-payments that patients find unacceptably high. Patients who are prescribed medications for the treatment of their conditions, and their prescribing physicians, generally rely on third-party payors to reimburse all or part of the costs associated with their prescription drugs. Patients are unlikely to use a product candidate, if approved, unless coverage is provided and reimbursement is adequate to cover all or a significant portion of the cost of its products. Therefore, coverage and adequate reimbursement is critical to new product acceptance. If reimbursement is not available or is available only to limited levels, Gemphire may not be able to successfully commercialize any product candidate for which it obtains marketing approval.

        There may be significant delays in obtaining reimbursement for newly approved drugs, and coverage may be more limited than the purposes for which a product candidate is approved by the FDA or similar regulatory authorities outside the United States. Moreover, eligibility for reimbursement does not imply that any product will be paid for in all cases or at a rate that covers its costs, including research, development, manufacture, sale and distribution. Interim reimbursement levels for a new product, if applicable, may also not be sufficient to cover its costs and may not be made permanent. Reimbursement rates may vary according to the use of the product and the clinical setting in which it is used, may be based on reimbursement levels already set for lower cost medicines and may be incorporated into existing payments for other services. Net prices for products may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently restrict imports of medicines from countries where they may be sold at lower prices than in the United States. Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement policies. However, no uniform policy requirement for coverage and reimbursement for drug products exists among third-party payors in the United States. Therefore, coverage and reimbursement for drug products can differ significantly from payor to payor. As a result, the coverage determination process is often a time-consuming and costly process that will require Gemphire to provide scientific and clinical support for the use of its products to each payor separately, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained in the first instance.

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        Gemphire's inability to promptly obtain coverage and profitable payment rates from both government-funded and private payors for any approved products that it develops could have an adverse effect on its operating results, its ability to raise capital needed to commercialize products and its overall financial condition.

Product liability lawsuits against Gemphire could cause it to incur substantial liabilities and could limit commercialization of any product candidate that it may develop.

        Gemphire faces an inherent risk of product liability exposure related to the testing of its product candidate in human clinical trials and will face an even greater risk if it commercially sells any products that it may develop. Product liability claims might be brought against Gemphire by patients, healthcare providers or others selling or otherwise coming into contact with gemcabene or any future product candidate during product testing, manufacturing, marketing or sale. For example, Gemphire may be sued on allegations that a product candidate caused injury or that the product is otherwise unsuitable. Any such product liability claims may include allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in the product, including as a result of interactions with alcohol or other drugs, negligence, strict liability, and a breach of warranties. Claims could also be asserted under state consumer protection acts. If Gemphire cannot successfully defend itself against claims that its product candidate caused injuries, it could incur substantial liabilities. Regardless of merit or eventual outcome, liability claims may result in:

        Any product liability or clinical trial insurance coverage that Gemphire does obtain may not be adequate to cover all liabilities that it may incur. Gemphire may need to increase its insurance coverage as it expands clinical trials and if it successfully commercializes gemcabene or any other product candidate it may pursue in the future. Insurance coverage is increasingly expensive, and Gemphire may not be able to obtain product liability insurance on commercially reasonable terms or in an amount adequate to satisfy any liability that may arise.

If Gemphire or its third-party manufacturers fail to comply with environmental, health and safety laws and regulations, it could become subject to fines or penalties or incur costs that could have an adverse effect on the success of its business.

        Gemphire's research and development activities involve the controlled use of potentially hazardous substances, including chemical and biological materials, by itself and its third-party manufacturers. Gemphire's manufacturers are subject to federal, state and local laws and regulations in the United States and abroad governing laboratory procedures and the use, manufacture, storage, handling and disposal of medical and hazardous materials. Although Gemphire believes that its manufacturers' procedures for using, handling, storing and disposing of these materials comply with legally prescribed standards, Gemphire cannot completely eliminate the risk of contamination or injury resulting from

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medical or hazardous materials. As a result of any such contamination or injury, Gemphire may incur liability or local, city, state or federal authorities may curtail the use of these materials and interrupt its business operations. In the event of an accident, Gemphire could be held liable for damages or penalized with fines, and the liability could exceed its resources. Gemphire does not have any insurance for liabilities arising from medical or hazardous materials. Although Gemphire maintains workers' compensation insurance to cover it for costs and expenses it may incur due to injuries to its employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. Compliance with applicable environmental, health and safety laws and regulations is expensive, and current or future environmental regulations may impair its research, development and production efforts, which could harm its business, prospects, financial condition or results of operations.

Risks Related to its Dependence on Third Parties

Gemphire will be unable to directly control all aspects of its clinical trials due to its reliance on clinical research organizations (CROs) and other third parties that assist it in conducting clinical trials.

        Gemphire will rely on CROs to conduct part or all of its preclinical studies and clinical trials for any product candidate, including its Phase 2 and Phase 3 trials for gemcabene. As a result, Gemphire will have limited control over the conduct, timing and completion of these clinical trials and the management of data developed through the clinical trials. Communicating with outside parties can also be challenging, potentially leading to mistakes as well as difficulties in coordinating activities. Outside parties may:

        These factors may adversely affect the willingness or ability of third parties to conduct Gemphire's clinical trials and may subject it to unexpected cost increases that are beyond its control.

        Moreover, the FDA and other global health authorities require Gemphire to comply with standards, commonly referred to as good clinical practices, for conducting, recording, and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of clinical trial participants are protected. Gemphire's reliance on third parties that it does not control does not relieve it of these responsibilities and requirements.

        Problems with the timeliness or quality of the work of any CRO may lead Gemphire to seek to terminate its relationship with any such CRO and use an alternative service provider. Making this change may be costly and may delay Gemphire's clinical trials, and contractual restrictions may make such a change difficult or impossible to effect. If Gemphire must replace any CRO that is conducting its clinical trials, its clinical trials may have to be suspended until it finds another CRO that offers comparable services. The time that it takes Gemphire to find alternative organizations may cause a delay in the commercialization of gemcabene or may cause it to incur significant expenses to replicate data that may be lost. Although Gemphire does not believe that any CRO on which it may rely will offer services that are not available elsewhere, it may be difficult to find a replacement organization that can conduct its clinical trials in an acceptable manner and at an acceptable cost. Any delay in or inability of Gemphire to complete its clinical trials could significantly compromise its ability to secure regulatory approval of gemcabene and preclude its ability to commercialize gemcabene, thereby limiting or preventing its ability to generate revenue from its sales.

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Gemphire relies completely on third parties to supply and manufacture its preclinical and clinical drug supplies for gemcabene, and Gemphire intends to rely on third parties to produce commercial supplies of gemcabene.

        Gemphire does not currently have, nor does it plan to acquire, the infrastructure or capability to internally manufacture its clinical drug supply of gemcabene, or any future product candidates, for use in the conduct of its preclinical studies and clinical trials, and Gemphire lacks the internal resources and the capability to manufacture any product candidates on a clinical or commercial scale. The process of manufacturing drug products is complex, highly regulated and subject to several risks. For example, the facilities used by Gemphire's contract manufacturers to manufacture the active pharmaceutical ingredient (or drug substance) and final drug product for gemcabene, or any future product candidates, must be inspected by the FDA and other comparable foreign regulatory agencies in connection with its submission of an NDA or relevant foreign regulatory submission to the applicable regulatory agency. In addition, the manufacturing of drug substance or product is susceptible to product loss due to contamination, equipment failure, improper installation or operation of equipment, or vendor or operator error. Moreover, the manufacturing facilities in which gemcabene or any future product candidates are made could be adversely affected by equipment failures, labor shortages, natural disasters, power failures or other factors.

        Gemphire does not control the manufacturing process of, and is completely dependent on, its contract manufacturers to comply with current good manufacturing practices (cGMP) for manufacture of both active drug substances and finished drug products. If Gemphire's contract manufacturers cannot successfully manufacture material that conforms to its specifications and the strict regulatory requirements of the FDA or applicable foreign regulatory agencies, Gemphire will not be able to secure and/or maintain regulatory approval for its products. In addition, Gemphire has no direct control over its contract manufacturers' ability to maintain adequate quality control, quality assurance and qualified personnel. Failure to satisfy the regulatory requirements for the production of those materials and products may affect the regulatory clearance of Gemphire's contract manufacturers' facilities generally. If the FDA or a comparable foreign regulatory agency does not approve these facilities for the manufacture of gemcabene or any future product candidates, or withdraws its approval in the future, Gemphire may need to find alternative manufacturing facilities, which would adversely impact its ability to develop, obtain regulatory approval for or market gemcabene or such future product candidates. Furthermore, all of its contract manufacturers are engaged with other companies to supply and/or manufacture materials or products for such companies, which exposes Gemphire's manufacturers to regulatory and sourcing risks for the production of such materials and products. To the extent practicable, Gemphire attempts to identify more than one supplier, but some raw materials are available only from a single source or only one supplier has been identified, even in instances where multiple sources exist.

        Gemphire has relied upon third-party manufacturers for the manufacture of its product candidate for preclinical and clinical testing purposes and intend to continue to do so in the future, including for commercial purposes. If Gemphire's third party manufacturers are unable to supply drug substance and/or drug product on a commercial basis, Gemphire may not be able to successfully produce and market gemcabene, if approved, or could be delayed in doing so. For instance, Gemphire relies on one supplier to provide the drug substance for gemcabene. The manufacturer of the drug substance for gemcabene will need to manufacture batches of the drug substance that will serve as the validation batches that will be reviewed by the FDA in connection with its review of the NDA for gemcabene and as the supply of gemcabene, if approved and successfully launched commercially. If there is any delay or problem with the manufacture of these batches of drug substance or if there is a delay in producing finished product from these batches, the approval of gemcabene may be delayed or any potential launch of gemcabene may be adversely affected. Gemphire will rely on comparison of product specifications (identity, strength, quality, potency) to demonstrate equivalence of the current drug

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substance and/or drug product to the drug substance and/or drug product used in previously completed preclinical and clinical testing. If Gemphire is unable to demonstrate such equivalence, it may be required to conduct additional preclinical and/or clinical testing of its product candidate.

        These and other problems with any manufacturer may lead Gemphire to seek to terminate its relationship with any such manufacturer and use an alternative manufacturer. Making this change may be costly, time consuming and difficult to effectuate, and may delay Gemphire's research and development activities. If Gemphire must replace any manufacturer, its research and development activities may have to be suspended until it finds another manufacturer that offers comparable services. The time that it takes it to find alternative organizations may cause a delay in the development and commercialization of gemcabene or any future product candidate.

Gemphire may form or seek strategic alliances or enter into additional licensing arrangements in the future, and Gemphire may not realize the benefits of such alliances or licensing arrangements.

        Gemphire may form or seek strategic alliances, create joint ventures or collaborations or enter into additional licensing arrangements with third parties that it believes will complement or augment its development and commercialization efforts with respect to gemcabene and any future product candidates that it may develop. For example, Gemphire entered into the Beijing SL License Agreement, which granted Beijing SL an exclusive royalty-bearing license to research, develop, manufacture and commercialize pharmaceutical products comprising, as an active ingredient, gemcabene, in Greater China. This relationship and any other strategic alliance or collaboration may require Gemphire to incur non-recurring and other charges, increase its near and long-term expenditures, issue securities that dilute its existing stockholders or disrupt its management and business. Gemphire's likely collaborators include large and mid-size pharmaceutical companies, regional and national pharmaceutical companies and biotechnology companies. If Gemphire enters into any such arrangements with any third parties, it will likely have limited control over the amount and timing of resources that its collaborators dedicate to the development or commercialization of gemcabene or any future product candidate. Gemphire's ability to generate revenues from these arrangements will depend on its collaborators' abilities to successfully perform the functions assigned to them in these arrangements. Gemphire cannot be certain that, following a strategic transaction or license, it will achieve the revenue or specific net income that justifies such transaction.

        Collaborations involving gemcabene or any future product candidate pose the following risks to it:

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        If future collaboration partners fail to develop or effectively commercialize gemcabene or any future product candidate for any of these reasons, such product candidate may not be approved for sale and Gemphire's sales of such product candidate, if approved, may be limited, which would have an adverse effect on Gemphire's operating results and financial condition.

If Gemphire is not able to establish new collaborations on commercially reasonable terms, it may have to alter its development and commercialization plans.

        Gemphire faces significant competition in attracting collaborators. Whether Gemphire reaches a definitive agreement for collaboration will depend, among other things, upon its assessment of the collaborator's resources and expertise, the terms and conditions of the proposed collaboration and the proposed collaborator's evaluation of a number of factors related to the associated product candidate. Those factors may include the design or results of clinical trials, the likelihood of approval by the FDA or similar regulatory authorities outside the United States, the potential market for the product candidate, the costs and complexities of manufacturing and delivering such product candidate to patients, the potential of competing products, the existence of uncertainty with respect to its ownership of technology, which can exist if there is a challenge to such ownership without regard to the merits of

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the challenge and industry and market conditions generally. The collaborator may also consider alternative product candidates or technologies for similar indications that may be available to collaborate on and whether such a collaboration could be more attractive than the one with Gemphire.

        Much of the potential revenue from future collaborations may consist of contingent payments, such as payments for achieving regulatory milestones or royalties payable on sales of Gemphire's product candidate, if approved. The milestone and royalty revenue that Gemphire may receive under these collaborations will depend upon its collaborators' ability to successfully develop, introduce, market and sell its new product candidate, if approved. In addition, collaborators may decide to enter into arrangements with third parties to commercialize products developed under collaborations related to Gemphire's product candidate, which could reduce the milestone and royalty revenue received, if any.

        Gemphire may also be restricted under existing collaboration agreements from entering into future agreements on certain terms with potential collaborators. Collaborations are complex and time-consuming to negotiate and document. In addition, there have been a significant number of recent business combinations among large pharmaceutical companies that have resulted in a reduced number of potential future collaborators.

        Gemphire may not be able to negotiate collaborations on a timely basis, on acceptable terms, or at all. If Gemphire is unable to do so, it may have to curtail the development of the product candidate for which it is seeking to collaborate, reduce or delay its development program or one or more of its other development programs, delay its potential commercialization or reduce the scope of any sales or marketing activities, or increase its expenditures and undertake development or commercialization activities at its own expense. If Gemphire elects to increase its expenditures to fund development or commercialization activities on its own, it may need to obtain additional capital, which may not be available to it on acceptable terms or at all. If Gemphire does not have sufficient funds, it may not be able to further develop its product candidate or bring it to market and generate product revenue.

Risks Related to Gemphire's Intellectual Property

If Gemphire is unable to adequately protect its proprietary technology or maintain issued patents sufficient to protect gemcabene or any future product candidate, others could compete against it more directly, which would have an adverse impact on its business, results of operations, financial condition and prospects.

        Gemphire's commercial success will depend in part on its success obtaining and maintaining issued patents and other intellectual property rights in the United States and elsewhere and protecting its proprietary technology. If Gemphire does not adequately protect its intellectual property and proprietary technology, competitors may be able to use its technologies and erode or negate any competitive advantage it may have, which could harm its business and ability to achieve profitability. Gemphire licensed patents relating to its current product candidate, gemcabene, from Pfizer. Pursuant to the license agreement, Gemphire is responsible for filing, prosecuting and maintaining the patent rights in Pfizer's name at its own cost and expense. In connection with this obligation, Gemphire is granted the first right to control the enforcement of the license patents against any third-party infringement actions. Risks related to its Pfizer license are discussed elsewhere in this "Risk Factors" section under "Gemphire depends on intellectual property licensed from Pfizer for gemcabene, and the termination of this license would harm Gemphire's business." The termination of this license could result in the loss of significant rights, which would harm Gemphire's business.

        As of September 30, 2019, Gemphire's patent estate, including patents it owns or licenses from third parties, on a worldwide basis, included 8 issued U.S. patents, 10 pending U.S. patent applications, 41 issued patents in foreign jurisdictions including Australia, Austria, Belgium, Bulgaria, Canada, Czechia, Demark, Finland, France, Germany, Great Britain, Greece, Hungary, Ireland, Italy, Japan, Luxembourg, Mexico, Netherlands, Poland, Portugal, Romania, Sweden, Switzerland and Spain and 84 pending patent applications in foreign jurisdictions including Argentina, Australia, Brazil, Canada,

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China, Europe, Hong Kong, Israel, India, Japan, Mexico, New Zealand, Philippines, Russia, Singapore, Thailand, Taiwan and South Africa. Gemphire's worldwide patents and pending applications all relate to its product candidate, gemcabene. Gemphire's patents that claimed the gemcabene composition of matter which were in-licensed from Pfizer, have all expired; however, Gemphire's clinical formulation comprises a specific calcium salt crystal form of gemcabene, which form is claimed in U.S. Patent Numbers 6,861,555 and 7,141,608. These patents, which was in-licensed from Pfizer, are expected to expire in 2021, absent any patent term extension. Gemphire's current patent estate includes fourteen patent families that have claims directed to methods of treatment using gemcabene. These patent families include, for example, U.S. Patent Number 8,557,835, licensed from Pfizer that has claims directed to pharmaceutical compositions comprised of combinations of gemcabene with statins and methods of using a combination of gemcabene on top of a statin in a patient that does not reach sufficient LDL-C lowering on a statin alone, for treating several conditions including hyperlipidemia. U.S. Patent Number 8,557,835 is expected to expire in 2021, absent any patent term extension. All related foreign patents are now expired. Additionally, U.S. Patent Number 8,846,761 is owned by Gemphire. U.S. Patent Number 8,846,761 is directed to methods of decreasing a subject's risk for developing pancreatitis by administering gemcabene and is expected to expire in 2032. Any foreign patent in this family that may issue, is expected to expire in 2031, absent any patent term extension. U.S. Patent No 10,028,926, is directed to methods of decreasing a patient's risk for developing coronary heart disease or preventing, delaying or reducing the severity of a secondary cardiovascular event by administering gemcabene with a statin. Related patent applications are pending in foreign jurisdictions including Canada, China, Europe and Japan. Any patent that may issue in this family, absent any patent term adjustment or extension, is expected to expire in 2033. U.S. Patent No. 9,849,104 is directed to methods of stabilizing NAFLD or NAS of ³ 2 or reducing hepatic fibrosis. U.S. Patent No. 9,849,104 is expected to expire in 2036 and the two pending U.S. patent applications, without any extensions will also expire in 2036. Any foreign patent in this family that may issue, is expected to expire in 2036, absent any patent term extension. U.S. Patent No. 10, 227,285 which is owned by Gemphire, is directed to methods of large-scale manufacturing for making dicarboxyalkyl ethers. Foreign counterpart patent applications are pending in Australia, Brazil, Canada, China, Europe, Hong Kong, India, Israel, Japan, Mexico, New Zealand, Korea, Russia, Singapore and South Africa. Any patent issuing from this patent family is expected to expire in 2035.

        In 2017 Gemphire also filed two PCT applications, one for methods of treating mixed dyslipidemia using gemcabene in combination with statins and treatment of NASH using gemcabene as a monotherapy (PCT/US2016/060837), and the other relating to fixed dose combinations and modified release formulations of gemcabene and statins (PCT/US2016/060849). Two U.S. Patent Applications were filed as continuations of PCT/US2016/060837, U.S. Patent Application Number 15/416,911, now U.S. 9,849,104, is directed to methods of treating NASH by administering gemcabene as a monotherapy, U.S. Patent Application Number 15/424,620, is directed methods for treating Mixed Dyslipidemia by administering gemcabene and a statin, and will issue as U.S. Patent No. 10,449,154 on October 22, 2019 and one divisional U.S. Patent Application Number 15/814,557 directed to other aspects of NASH. With the PCT application, 18 foreign non-provisional applications were filed. Any patent that may issue from these families, absent any patent term adjustment or extension, is expected to expire in 2036.

        The patent prosecution process is expensive and time-consuming, and Gemphire and its current or future licensors, licensees or collaboration partners may not be able to prepare, file and prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner. It is also possible that Gemphire or its licensors will fail to identify patentable aspects of inventions made in the course of development and commercialization activities before it is too late to obtain patent protection on them. Gemphire and its licensors' patent applications cannot be enforced against third parties practicing the technology claimed in such applications unless and until a patent issues from such applications, and then only to the extent the issued claims cover the technology.

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        Gemphire cannot assure you that any of its patents have, or that any of its pending patent applications will mature into issued patents that will include, claims with a scope sufficient to protect gemcabene or any future product candidate. Others have developed technologies that may be related or competitive to its approach, and may have filed or may file patent applications and may have received or may receive patents that overlap or conflict with Gemphire's patent applications, either by claiming the same methods or formulations or by claiming subject matter that could dominate Gemphire's patent position. The patent positions of biotechnology and pharmaceutical companies, including Gemphire's patent position, involve complex legal and factual questions, and, therefore, the issuance, scope, validity and enforceability of any patent claims that Gemphire may obtain cannot be predicted with certainty. Patents, if issued, may be challenged, deemed unenforceable, invalidated, or circumvented. U.S. patents and patent applications may also be subject to interference proceedings, ex parte reexamination, or inter partes review proceedings, supplemental examination and challenges in district court. Patents may be subjected to opposition, post-grant review, or comparable proceedings lodged in various national and regional patent offices. These proceedings could result in either loss of the patent or denial of the patent application or loss or reduction in the scope of one or more of the claims of the patent or patent application. In addition, such interference, re-examination, opposition, post-grant review, inter partes review, supplemental examination or revocation proceedings may be costly. Thus, any patents that Gemphire may own or exclusively license may not provide any protection against competitors. Furthermore, an adverse decision in an interference proceeding can result in a third-party receiving the patent right sought by Gemphire, which in turn could affect Gemphire's ability to develop, market or otherwise commercialize gemcabene.

        Furthermore, the issuance of a patent, while presumed valid, is not conclusive as to its validity or its enforceability and it may not provide Gemphire with adequate proprietary protection or competitive advantages against competitors with similar products. Competitors may also be able to design around Gemphire's patents. Other parties may develop and obtain patent protection for more effective technologies, designs or methods. Gemphire may not be able to prevent the unauthorized disclosure or use of any technical knowledge or trade secrets by consultants, vendors, former employees and current employees. The laws of some foreign countries do not protect Gemphire's proprietary rights to the same extent as the laws of the United States, and Gemphire may encounter significant problems in protecting its proprietary rights in these countries. If these developments were to occur, they could have a material adverse effect on Gemphire's sales.

        Gemphire's ability to enforce its patent rights depends on its ability to detect infringement. It is difficult to detect infringers who do not advertise the components that are used in their products. Moreover, it may be difficult or impossible to obtain evidence of infringement in a competitor's or potential competitor's product. Any litigation to enforce or defend Gemphire's patent rights, if any, even if Gemphire were to prevail, could be costly and time-consuming and would divert the attention of Gemphire's management and key personnel from its business operations. Gemphire may not prevail in any lawsuits that it initiates and the damages or other remedies awarded if Gemphire were to prevail may not be commercially meaningful.

        In addition, proceedings to enforce or defend Gemphire's patents could put its patents at risk of being invalidated, held unenforceable, or interpreted narrowly. Such proceedings could also provoke third parties to assert claims against Gemphire, including that some or all of the claims in one or more of its patents are invalid or otherwise unenforceable. If, in any proceeding, a court invalidated or found unenforceable Gemphire's patents covering gemcabene or any future product candidate, its financial position and results of operations would be adversely impacted. In addition, if a court found that valid, enforceable patents held by third parties covered gemcabene or any future product candidate, Gemphire's financial position and results of operations would also be adversely impacted.

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        The degree of future protection for Gemphire's proprietary rights is uncertain, and Gemphire cannot ensure that:

        Patents have a limited lifespan. The natural expiration of a patent is generally 20 years after its effective filing date. Various extensions may be available; however, the life of a patent, and the protection it affords, is limited. Given the extensive period of time between patent filing and regulatory approval for a product candidate, the time during which Gemphire can market a product candidate under patent protection is limited, and Gemphire's patent may expire before it obtains such approval. Without patent protection for gemcabene or any future product candidates, Gemphire may be open to competition from generic versions of its product candidates, which may affect the profitability of Gemphire's product candidates.

If Gemphire does not obtain protection under the Hatch-Waxman Act and similar foreign legislation by extending the patent terms and obtaining data exclusivity for its product candidate, its business may be materially harmed.

        Depending upon the timing, duration of regulatory review, and date of FDA marketing approval of gemcabene or any future product candidate, if any, one of Gemphire's U.S. patents may be eligible for patent term restoration under the Drug Price Competition and Patent Term Restoration Act of 1984, referred to as the Hatch-Waxman Act. The Hatch-Waxman Act provides for a patent restoration term of up to five years as compensation for the time the product is under FDA regulatory review (patent term extension). The duration of patent term extension is calculated based on the time spent in the regulatory review process. Gemphire's basic U.S. composition of matter patent for gemcabene has expired. Gemphire plans to seek patent term extension for one of its patents related to gemcabene. However, Gemphire may not be granted an extension because of, for example, failing to apply within the applicable deadline, expiration of relevant patents prior to obtaining approval, or otherwise failing to satisfy applicable requirements. Moreover, the applicable time period or the scope of patent protection afforded could be less than Gemphire requests. If Gemphire is unable to obtain patent term extension or the term of any such extension is less than Gemphire requests, Gemphire's revenue could be reduced, possibly materially.

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        In addition, Gemphire believes that gemcabene is a NCE in the United States and may be eligible for data exclusivity under the Hatch-Waxman Act. A single-ingredient drug can be classified as a NCE if the FDA has not previously approved any other new drug containing the same active ingredient. Under sections 505(c)(3)(E)(ii) and 505(j)(5)(F)(ii) of the FDC Act, as amended, a NCE that is granted marketing approval may, even in the absence of patent protections, be eligible for five years of data exclusivity in the United States following marketing approval. During the data exclusivity period, if granted, the FDA is precluded from approving 505(b)(2) applications or abbreviated new drug applications submitted by another company that references the FDA's findings of safety and efficacy for the approved NDA. In the European Union, NCEs qualify for eight years of data exclusivity upon marketing authorization and an additional two years of market exclusivity. This data exclusivity, if granted, prevents regulatory authorities in the European Union from reviewing a generic application for eight years, after which generic marketing authorization can be approved but the generic drug may not be marketed during the two-year marketing exclusivity period. However, gemcabene may not be considered to be a NCE for these purposes or be entitled to the period of data exclusivity. If Gemphire is not able to gain or exploit the period of data exclusivity, it may face significant competitive threats to its commercialization of gemcabene from other manufacturers, including the manufacturers of generic alternatives. Further, even if Gemphire's compound is considered to be a NCE and Gemphire is able to gain the prescribed period of data exclusivity, another company nevertheless could gain marketing approval for the same compound if they independently generate preclinical and clinical data and get market approval through the NDA process without the benefit of Gemphire data.

If Gemphire fails to maintain orphan drug exclusivity for gemcabene for HoFH, it will have to rely on data and marketing exclusivity for HoFH that is not based on an orphan drug designation, if any, and on its intellectual property rights.

        In the United States Gemphire has obtained orphan drug designation for gemcabene for the treatment of HoFH. Gemphire may submit an application to the FDA for other orphan drug designations for gemcabene such as for the treatment of TG greater than approximately 750 mg/dL (F) or Familial Partial Lipodystrophy under the Orphan Drug Act, the FDA may designate a product as an orphan drug if it is a drug intended to treat a rare disease or condition, defined, in part, as a patient population of fewer than 200,000 in the United States.

        In the United States, the company that first obtains FDA approval for a designated orphan drug for the specified rare disease or condition receives orphan drug marketing exclusivity for that drug for a period of seven years. This orphan drug exclusivity prevents the FDA from approving another application, including a full NDA, to market the same drug for the same orphan indication, except in very limited circumstances. For purposes of small molecule drugs, the FDA defines "same drug" as a drug that contains the same active pharmaceutical ingredient (API) and is intended for the same use as the drug in question. A designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan designation. In addition, orphan drug exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the drug to meet the needs of patients with the rare disease or condition.

        The EMA grants orphan drug designation to promote the development of products that may offer therapeutic benefits for life-threatening or chronically debilitating conditions affecting not more than five in 10,000 people in the European Union. Orphan drug designation from the EMA provides ten years of marketing exclusivity following drug approval, subject to reduction to six years if the designation criteria are no longer met.

        Even if Gemphire is able to obtain and maintain orphan drug exclusivity for gemcabene for HoFH, the designation may not effectively protect it from competition for HoFH because different drugs can be approved for the same condition. Moreover, even with an orphan drug designation, the FDA can

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subsequently approve a different formulation of the same API for the same condition if the FDA concludes that the later formulation of the API is safer, more effective or makes a major contribution to patient care.

Changes in U.S. patent law could diminish the value of patents in general, thereby impairing Gemphire's ability to protect gemcabene and any product candidate it may pursue in the future.

        In 2011, the United States enacted wide-ranging patent reform legislation with the America Invents Act (AIA).

        An important change introduced by the AIA is that, as of March 16, 2013, the United States transitioned to a "first-to-file" system for deciding which party should be granted a patent when two or more patent applications are filed by different parties claiming the same invention. A third party that files a patent application in the U.S. Patent and Trademark Office (USPTO) after that date but before Gemphire could therefore be awarded a patent covering a Gemphire invention even if Gemphire had made the invention before it was made by the third party. This will require Gemphire to be cognizant going forward of the time from invention to filing of a patent application, but circumstances could prevent Gemphire from promptly filing patent applications on its inventions.

        Among some of the other changes introduced by the AIA are changes that limit where a patentee may file a patent infringement suit and providing opportunities for third parties to challenge any issued patent in the USPTO. This applies to all of Gemphire's U.S. patents, even those issued before March 16, 2013. Because of a lower evidentiary standard in USPTO proceedings compared to the evidentiary standard in U.S. federal courts necessary to invalidate a patent claim, a third party could potentially provide evidence in a USPTO proceeding sufficient for the USPTO to hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if first presented in a district court action. Accordingly, a third party may attempt to use the USPTO procedures to invalidate Gemphire's patent claims that would not have been invalidated if first challenged by the third party as a defendant in a district court action. The AIA and its implementation could increase the uncertainties and costs surrounding the prosecution of its patent applications and the enforcement or defense of Gemphire's issued patents.

        Additionally, the U.S. Supreme Court has ruled on several patent cases in recent years, such as Association for Molecular Pathology v. Myriad Genetics, Inc. (Myriad I), Mayo Collaborative Services v. Prometheus Laboratories, Inc. and Alice Corporation Pty. Ltd. v. CLS Bank International, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. In addition to increasing uncertainty with regard to Gemphire's ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained. Depending on decisions by the U.S. Congress, the federal courts, and the USPTO, the laws and regulations governing patents could change in unpredictable ways that would weaken Gemphire's ability to obtain new patents or to enforce its existing patents and patents that Gemphire might obtain in the future.

Gemphire may not be able to protect or practice its intellectual property rights throughout the world.

        In jurisdictions where Gemphire has not obtained patent protection, competitors may use Gemphire's intellectual property to develop their own products and further, may export otherwise infringing products to territories where Gemphire has patent protection, but where it is more difficult to enforce a patent as compared to the U.S. Competitor products may compete with gemcabene, if approved, or any future product candidate in jurisdictions where Gemphire does not have issued or granted patents or where Gemphire issued or granted patent claims or other intellectual property rights are not sufficient to prevent competitor activities in these jurisdictions. The legal systems of certain countries, particularly certain developing countries, make it difficult to enforce patents and such

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countries may not recognize other types of intellectual property protection, particularly that relating to pharmaceuticals. This could make it difficult for Gemphire to prevent the infringement of its patents or marketing of competing products in violation of its proprietary rights generally in certain jurisdictions. Proceedings to enforce Gemphire's patent rights in foreign jurisdictions could result in substantial cost and divert its efforts and attention from other aspects of Gemphire's business.

        The laws of some jurisdictions do not protect intellectual property rights to the same extent as the laws in the United States, and many companies have encountered significant difficulties in protecting and defending such rights in such jurisdictions. If Gemphire, or its licensors, encounter difficulties in protecting, or are otherwise precluded from effectively protecting, the intellectual property rights important for Gemphire's business in such jurisdictions, the value of these rights may be diminished and Gemphire may face additional competition from others in those jurisdictions. Many countries have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In addition, many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of such patent. If Gemphire, or any of its licensors, are forced to grant a license to third parties with respect to any patents relevant to Gemphire's business, its competitive position in the relevant jurisdiction may be impaired and its business and results of operations may be adversely affected.

Gemphire may become involved in lawsuits to protect or enforce its patents and other intellectual property rights, which could be expensive, time consuming and unsuccessful.

        Competitors may infringe Gemphire's patents and other intellectual property rights. To counter infringement or unauthorized use, Gemphire may be required to file infringement claims, which can be expensive and time consuming. In addition, in an infringement proceeding, a court may decide that Gemphire's patent is invalid or unenforceable, or may refuse to stop the other party from using the technology on the grounds that Gemphire's patents do not cover the technology in question. An adverse result in any litigation proceeding could put one or more of Gemphire's patents at risk of being invalidated or interpreted narrowly. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of Gemphire's confidential information could be compromised by disclosure during this type of litigation. Moreover, there can be no assurance that Gemphire will have sufficient financial or other resources to file and pursue such infringement claims, which typically last for years before they are concluded.

        Litigation proceedings may fail and, even if successful, may result in substantial costs and distraction of Gemphire's management and other employees. Gemphire may not be able to prevent, alone or with its collaborators, misappropriation of its proprietary rights, particularly in countries where the laws may not protect those rights as fully as in the United States.

        In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments. If securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of Gemphire common stock.

Third parties may initiate legal proceedings alleging that Gemphire is infringing their intellectual property rights, the outcome of which would be uncertain and could have an adverse effect on the success of Gemphire's business.

        Gemphire's commercial success depends upon its ability and the ability of its collaborators to develop, manufacture, market and sell gemcabene and any other product candidate Gemphire may pursue in the future and use its proprietary technologies without infringing the proprietary rights and intellectual property of third parties. The biotechnology and pharmaceutical industries are characterized by extensive litigation regarding patents and other intellectual property rights. Gemphire may in the

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future become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to its medicines and technology, including interference or derivation proceedings, post-grant reviews, inter partes reviews, or other procedures before the USPTO or other similar procedures in foreign jurisdictions. Third parties may assert infringement claims against Gemphire based on existing patents or patents that may be granted in the future. If Gemphire is found to infringe a third party's intellectual property rights, Gemphire could be required to obtain a license from such third party to continue developing and marketing Gemphire's medicines and technology. However, Gemphire may not be able to obtain any required license on commercially reasonable terms or at all. Even if Gemphire were able to obtain a license, it could be non-exclusive, thereby giving its competitors and other third parties access to the same technologies licensed to it. Gemphire could be forced, including by court order, to cease developing and commercializing the infringing technology or medicine. In addition, Gemphire could be found liable for substantial monetary damages, potentially including treble damages and attorneys' fees, if Gemphire is found to have willfully infringed. A finding of infringement could prevent Gemphire from commercializing a product candidate or force Gemphire to cease some of its business operations, which could harm its business. Alternatively, Gemphire may need to redesign its infringing products, which may be impossible or require substantial time and monetary expenditure. Claims that Gemphire has misappropriated the confidential information or trade secrets of third parties could have a similar negative impact on Gemphire's business.

        The cost to Gemphire of any litigation or other proceeding relating to patent or other proprietary rights, even if resolved in its favor, could be substantial and may result in substantial costs and distraction of its management and other employees. Some of Gemphire's competitors may be able to sustain the costs of complex patent litigation more effectively than Gemphire can because they have substantially greater resources. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could delay Gemphire's research and development efforts and limit its ability to continue its operations.

Gemphire may be subject to damages resulting from claims that its employees or it has wrongfully used or disclosed alleged trade secrets of their former employers.

        Gemphire's employees and consultants have been previously employed at other biotechnology or pharmaceutical companies, including its competitors or potential competitors. Although Gemphire is not aware of any claims currently pending against it, it may be subject to claims that these employees or Gemphire has inadvertently or otherwise used or disclosed trade secrets or other proprietary information or intellectual property of the former employers of its employees. Litigation may be necessary to defend against these claims. Even if Gemphire is successful in defending against these claims, litigation could result in substantial costs and be a distraction to management. If Gemphire fails in defending such claims, in addition to paying money claims, Gemphire may lose valuable intellectual property rights or personnel. A loss of key personnel or their work product could hamper or prevent Gemphire's ability to commercialize gemcabene, which would adversely affect Gemphire's commercial development efforts.

If Gemphire is not able to adequately prevent disclosure of trade secrets and other proprietary information, the value of any product Gemphire may pursue could be significantly diminished.

        Gemphire may rely upon trade secrets, know-how and continuing technological innovation to develop and maintain its competitive position. However, trade secrets are difficult to protect. Gemphire relies in part on confidentiality agreements with its employees, consultants, outside scientific collaborators, sponsored researchers, contract manufacturers, vendors and other advisors to protect its trade secrets and other proprietary information. These agreements may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event of

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unauthorized disclosure of confidential information. In addition, Gemphire cannot guarantee that it has executed these agreements with each party that may have or have had access to trade secrets.

        Moreover, because Gemphire acquired certain rights to gemcabene from Pfizer, Gemphire must rely on Pfizer's practices, and those of its predecessors, with regard to parties that may have had access to trade secrets related thereto. Any party with whom they or Gemphire has executed such an agreement may breach that agreement and disclose Gemphire's proprietary information, including Gemphire's trade secrets, and Gemphire may not be able to obtain adequate remedies for such breaches. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming, and the outcome is unpredictable. In addition, some courts inside and outside the United States are less willing or unwilling to protect trade secrets. If any of Gemphire's trade secrets were to be lawfully obtained or independently developed by a competitor, Gemphire would have no right to prevent them, or those to whom they disclose such trade secrets, from using that technology or information to compete with it. If any of Gemphire's trade secrets were to be disclosed to or independently developed by a competitor or other third-party, Gemphire's competitive position would be harmed.

Gemphire has registration for three United States trademarks and for one European Union trademark.

        Gemphire has registrations for three United States trademarks, "Gemphire", the Gemphire logo and "Advancing a class on top of statins", and a registration of "Gemphire Therapeutics Inc." in the European Union. If Gemphire does not secure and maintain registrations for its trademarks, it may encounter more difficulty in enforcing them against third parties than it otherwise would, which could affect its business. Gemphire has also not yet registered trademarks for any product candidate in any jurisdiction. When Gemphire files trademark applications for a product candidate, those applications may not be allowed for registration, and registered trademarks may not be obtained, maintained or enforced. During trademark registration proceedings in the United States and foreign jurisdictions, Gemphire may receive rejections. Gemphire is given an opportunity to respond to those rejections, but it may not be able to overcome such rejections. In addition, in the USPTO and in comparable agencies in many foreign jurisdictions, third parties are given an opportunity to oppose pending trademark applications and to seek to cancel registered trademarks. Opposition or cancellation proceedings may be filed against Gemphire's trademarks, and its trademarks may not survive such proceedings.

        In addition, any proprietary name Gemphire proposes to use with gemcabene or any future product candidate in the United States must be approved by the FDA, regardless of whether Gemphire has registered it, or applied to register it, as a trademark. The FDA typically conducts a review of proposed drug names, including an evaluation of potential for confusion with other drug names. If the FDA objects to any proposed proprietary drug name for any product candidate, Gemphire may be required to expend significant additional resources in an effort to identify a suitable substitute proprietary drug name that would qualify under applicable trademark laws, not infringe the existing rights of third parties and be acceptable to the FDA.

        If Gemphire registers any of its trademarks, its trademarks or trade names may be challenged, infringed, circumvented or declared generic or determined to infringe on other marks. Gemphire may not be able to protect its rights to these trademarks and trade names or may be forced to stop using these names, which it needs for name recognition by potential partners or customers in its markets of interest. If Gemphire is unable to establish name recognition based on its trademarks and trade names, Gemphire may not be able to compete effectively and its business may be adversely affected.

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Obtaining and maintaining Gemphire's patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and Gemphire's patent protection could be reduced or eliminated for noncompliance with these requirements.

        The USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment or other provisions during the patent application process. In addition, periodic maintenance and annuity fees on any issued patent are due to be paid to the USPTO and foreign patent agencies in several stages over the lifetime of the patent. While an inadvertent lapse can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, Gemphire's competitors might be able to enter the market, which would have an adverse effect on Gemphire's business.

Risks Related to Gemphire's Operations, Employee Matters and Managing Growth

Gemphire is dependent on its key personnel, and if Gemphire is not successful in attracting and retaining highly qualified personnel, it may not be able to successfully implement its business strategy.

        Gemphire is highly dependent on its management, scientific and medical personnel. Gemphire has entered into employment agreements with its executive officers, but any employee may terminate his or her employment with Gemphire. The loss of the services of any of Gemphire's executive officers, other key employees or consultants and other scientific and medical advisors in the foreseeable future, might impede the achievement of Gemphire's research, development and commercialization objectives. Gemphire relies on consultants and advisors, including scientific and clinical advisors, to assist it in formulating its development and commercialization strategy. Gemphire's consultants and advisors may be employed by employers other than Gemphire and may have commitments under consulting or advisory contracts with other entities that may limit their availability to Gemphire. Recruiting and retaining qualified scientific personnel and business and commercial personnel will also be critical to Gemphire's success. Gemphire may not be able to attract and retain these personnel on acceptable terms given the competition among numerous pharmaceutical and biotechnology companies for similar personnel. Gemphire also experiences competition for the hiring of scientific personnel from universities and research institutions. Failure to succeed in clinical trials may also make it more challenging to recruit and retain qualified scientific personnel.

Gemphire implemented a reduction in force that may have an adverse impact on its drug development activities, and attrition that may occur following this reduction could disrupt Gemphire's operations. In addition, Gemphire may not achieve anticipated benefits and savings from the reduction or be able to implement or benefit from any additional cost containment measures in the future.

        In September 2018, the Gemphire Board approved a workforce reduction to reduce costs and conserve cash resources in light of the delay in Gemphire's Phase 3 trials resulting from the FDA's request for additional data following the completion of two year carcinogenicity studies conducted in connection with the partial clinical hold on gemcabene. The workforce reduction included 5 employees, which represented approximately 33% of its workforce at such time, and was completed in the fourth quarter of 2018.

        The reduction in force, which included two of its executive officers, and any attrition that may occur following this reduction, has resulted in the loss of institutional knowledge and expertise and in the reallocation and combination of certain roles and responsibilities across the organization, all of which could adversely affect Gemphire's operations and its drug development activities. Gemphire's efforts to improve its managerial, operational and financial systems and manage its operations may be made more challenging given the reduction in force. As a result, Gemphire's management may need to

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divert a disproportionate amount of its attention away from its day-to-day strategic and operational activities, and devote a substantial amount of time to managing these organizational changes.

        Further, the reduction in force may yield unintended consequences, such as reduced employee morale and attrition beyond Gemphire's intended reduction in force, which may result in Gemphire seeking contract support at unplanned additional expense. Gemphire may not achieve anticipated benefits from the reduction in force. Due to its limited resources, Gemphire may not be able to effectively manage its operations or recruit and retain qualified personnel when and if needed, which may have an adverse impact on its drug development activities, result in weaknesses in its infrastructure and operations, risks that Gemphire may not be able to comply with legal and regulatory requirements, loss of business opportunities, loss of employees and reduced productivity among remaining employees. If Gemphire's management is unable to effectively manage this transition and reduction in force or successfully implement any additional cost containment measures, Gemphire's expenses may be more than expected, Gemphire may utilize cash more quickly than expected and Gemphire may not be able to implement its business strategy or continue the development of gemcabene.

        In addition, Gemphire's ability to successfully complete the merger depends in large part on its ability to retain its remaining personnel. Despite its efforts to retain these employees, one or more may terminate their employment with Gemphire on short notice. The loss of the services of any of these employees could potentially harm Gemphire's ability to consummate the merger, to run its day-to-day business operations, as well as to fulfill its reporting obligations as a public company.

Gemphire may need to develop and expand its company, and it may encounter difficulties in managing this development and expansion, which could disrupt its operations.

        As of September 30, 2019, Gemphire had seven full-time employees and, if Gemphire secures additional funding and receives a favorable decision from the FDA regarding its partial clinical hold, Gemphire may need to increase its number of employees and the scope of its operations as it furthers the clinical development of gemcabene beyond Phase 2 trials and continues to operate as a public company. To manage any anticipated development and potential expansion, Gemphire must continue to implement and improve its managerial, operational and financial systems, maintain adequate facilities and continue to recruit and train qualified personnel. Also, Gemphire's management may need to divert a disproportionate amount of its attention away from its day-to-day activities and devote a substantial amount of time to managing these development activities. Due to Gemphire's limited resources, Gemphire may not be able to manage the expansion of its operations or hire additional personnel. This may result in weaknesses in Gemphire's infrastructure, and give rise to operational mistakes, loss of business opportunities, loss of employees and reduced productivity among remaining employees. Any physical expansion of its operations may lead to significant costs and may divert financial resources from other projects, such as the development of gemcabene. If Gemphire's management is unable to effectively manage its expected development and future expansion, its expenses may increase more than expected, its ability to generate or increase its revenue could be reduced and it may not be able to implement its business strategy. Gemphire's future financial performance and its ability to commercialize gemcabene or any future product candidate, if approved, and compete effectively will depend, in part, on its ability to effectively manage the future development and expansion of Gemphire.

A variety of risks associated with operating internationally for Gemphire and its collaborators could adversely affect its business.

        In addition to Gemphire's U.S. operations, Gemphire may pursue international operations in the future and would face risks associated with such global operations, including possible unfavorable regulatory, pricing and reimbursement, legal, political, tax and labor conditions, which could harm its

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business. Gemphire plans to conduct clinical trials outside of the United States. Gemphire is subject to numerous risks associated with international business activities, including:

Gemphire's business and operations would suffer in the event of system failures or unplanned events.

        Despite the implementation of security measures, Gemphire's internal computer systems and those of its current and future contractors and consultants are vulnerable to damage from computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures. While Gemphire is not aware of any such material system failure, accident or security breach to date, if such an event were to occur and cause interruptions in Gemphire's operations, it could result in a material disruption of its development programs and its business operations. For example, the loss of clinical trial data from completed or future clinical trials could result in delays in Gemphire's regulatory approval efforts and significantly increase its costs to recover or reproduce the data. To the extent that any disruption or security breach were to result in a loss of, or damage to, its data or applications, or inappropriate disclosure of confidential or proprietary information, Gemphire could incur liability and the further development and commercialization of its product candidates could be delayed.

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        Furthermore, any unplanned event, such as flood, fire, explosion, tornadoes, earthquake, extreme weather condition, medical epidemics, power shortage, telecommunication failure or other natural or manmade accidents or incidents that result in Gemphire being unable to fully utilize the facilities, may have an adverse effect on Gemphire's ability to operate its business, particularly on a daily basis, and have significant negative consequences on Gemphire's financial and operating conditions. Loss of access to these facilities may result in increased costs, delays in the development of Gemphire's product candidates or interruption of Gemphire's business operations.

Risks Related to Gemphire Common Stock

The price of Gemphire common stock may be volatile and fluctuate substantially, which could result in substantial losses of Gemphire common stock.

        The trading price of Gemphire common stock is likely to be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond Gemphire's control, including limited trading volume. In addition to the factors discussed in this "Risk Factors" section and elsewhere in this proxy statement/prospectus/information statement, these factors include:

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        In addition, the stock market in general, Nasdaq, and the stock of biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies. Broad market and industry factors may negatively affect the market price of Gemphire common stock, regardless of its actual operating performance. In the past, securities class action litigation has often been instituted against companies following periods of volatility in the market price of a company's securities. This type of litigation, if instituted, could result in substantial costs and a diversion of management's attention and resources, which would harm Gemphire's business, operating results or financial condition.

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Gemphire is not in compliance with Nasdaq's continued listing requirements. If Gemphire is unable to comply with Nasdaq's continued listing requirements, Gemphire common stock could be delisted, which could affect Gemphire common stock's market price and liquidity and reduce its ability to raise capital.

        Gemphire common stock is currently listed on the Nasdaq Capital Market. Nasdaq imposes, among other requirements, continued listing standards including minimum bid, public float and stockholders' equity requirements.

        On March 20, 2019, Gemphire received written notice from the Nasdaq stating that it no longer complied with the minimum stockholders' equity requirement under Nasdaq Listing Rule 5450(b)(1)(A) for continued listing on the Nasdaq Global Market because its stockholders' equity, as reported in its Annual Report on Form 10-K for the year ended December 31, 2018, had fallen below $10 million. The notification letter also indicated that Gemphire does not meet the alternative compliance standards set forth in Nasdaq Listing Rule 5450(b).

        Under applicable Nasdaq rules, Gemphire had 45 calendar days from the date of the notification letter, or until May 6, 2019, to submit a plan to regain compliance. On May 6, 2019, the Gemphire Board approved an application to transfer Gemphire common stock to the Nasdaq Capital Market, which has a minimum stockholders' equity requirement of $2.5 million for continued listing, and Gemphire timely submitted its plan and application to transfer the Gemphire common stock to the Nasdaq Capital Market. On May 10, 2019, Gemphire received approval from Nasdaq to transfer the listing of its common stock to the Nasdaq Capital Market, which was effective at the opening of business on May 14, 2019.

        On August 8, 2019, Gemphire received a notice from Nasdaq stating that, for the last 30 consecutive business days, the closing bid price for Gemphire common stock was below the $1.00 per share minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2). In accordance with Nasdaq Listing Rule 5810(c)(3)(A), Gemphire has 180 calendar days, or until February 4, 2020, to regain compliance with the minimum bid price requirement. To regain compliance, the closing bid price of the Gemphire common stock must be at least $1.00 per share for a minimum of 10 consecutive business days at any time during this 180-day period. If Gemphire regains compliance with the minimum bid price rule, Nasdaq will provide Gemphire with written confirmation and will close the matter.

        If Gemphire does not regain compliance with the rule by February 4, 2020, Gemphire may be eligible for an additional 180 calendar day compliance period. To qualify, Gemphire would need to meet the continued listing requirement for market value of publicly held shares and all other applicable standards for initial listing on The Nasdaq Capital Market, with the exception of the bid price requirement, and would need to provide written notice of Gemphire's intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary. However, if it appears to Nasdaq that Gemphire will not be able to cure the deficiency, or if Gemphire is not eligible for a second compliance period, Nasdaq will notify Gemphire that Gemphire common stock will be subject to delisting. In the event of such a notification, Gemphire may appeal the determination, but there can be no assurance Nasdaq would grant Gemphire's request for continued listing.

        On August 12, 2019, Gemphire received written notice from Nasdaq stating that Gemphire no longer complies with the minimum stockholders' equity requirement under Nasdaq Listing Rule 5550(b)(1) for continued listing on the Nasdaq Capital Market because Gemphire's stockholder's equity, as reported in Gemphire's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019, had fallen below $2.5 million. The notice also indicated that Gemphire does not meet the alternative compliance standards.

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        On September 26, 2019, Gemphire submitted its compliance plan to Nasdaq, explaining how Gemphire believes that the completion of its proposed merger will address the stockholders' equity deficiency.

        On October 4, 2019, Nasdaq notified Gemphire that it had determined to grant Gemphire an extension until February 10, 2020 to regain compliance. Under the terms of the extension, NeuroBo must receive approval of its initial listing application and Gemphire must consummate the merger on or before February 10, 2020. If NeuroBo fails to receive approval of its initial listing application or Gemphire fails to consummate the merger prior to February 10, 2020, Nasdaq will provide written notification to Gemphire that its securities will be delisted. At that time, Gemphire may appeal Nasdaq's determination to a Listing Qualifications Panel.

        If Gemphire is unable to regain compliance, Nasdaq may make a determination to delist Gemphire common stock. Continued listing of Gemphire common stock on the Nasdaq Capital Market is a condition to the Closing of the merger. Furthermore, if Gemphire common stock is delisted, it will trade, if at all, only on an over-the-counter market, and then only if one or more registered broker-dealer market makers comply with quotation requirements. Upon any such delisting, Gemphire common stock could become subject to the regulations of the SEC relating to the market for penny stocks. Generally, any equity security not traded on a national securities exchange that has a market price of less than $5.00 per share may be deemed a penny stock. Any delisting of Gemphire common stock could adversely affect the market liquidity of Gemphire common stock and the market price of Gemphire common stock could decrease. Furthermore, if Gemphire common stock were delisted it could adversely affect Gemphire's ability to obtain financing for the continuation of its operations and its ability to attract and retain employees by means of equity compensation and/or result in the loss of confidence by investors.

If there are large sales of Gemphire common stock, the market price of Gemphire common stock could drop substantially. In addition, a significant number of shares of Gemphire common stock are subject to issuance upon exercise of outstanding options and warrants, which upon such exercise would result in dilution to Gemphire securityholders.

        If Gemphire or Gemphire's existing stockholders sell a large number of shares of Gemphire common stock or the public market perceives that Gemphire or Gemphire's existing stockholders might sell shares of Gemphire common stock, the market price of the Gemphire common stock could decline significantly. As of September 30, 2019, Gemphire had 14,872,411 outstanding shares of common stock, substantially all of which may be sold in the public market without restriction, subject to any affiliate restrictions. On September 1, 2017, Gemphire entered into an equity distribution agreement with Piper Jaffray &Co ("Piper"), as agent, under which Gemphire may, from time to time, issue and sell shares of its common stock having up to an aggregate offering price of $50,000,000 through an "at the market offering" program. Though Gemphire's ability to sell shares of its common stock through Piper under the equity distribution agreement is practically limited or precluded altogether due to Gemphire's currently-depressed stock price, to the extent that Gemphire sells shares of its common stock pursuant to the equity distribution agreement in the future, Gemphire Stockholders will experience dilution. In addition, as of September 30, 2019, there were 2,572,973 shares of Gemphire common stock issuable upon the exercise of outstanding options having a weighted-average exercise price of $8.93 per share and 1,014,204 shares of Gemphire common stock issuable upon exercise of outstanding warrants having a weighted-average exercise price of $10.30. Although Gemphire cannot determine at this time how many of the currently outstanding options or warrants will ultimately be exercised, the options and warrants will likely be exercised only if the exercise price is below the market price of the Gemphire common stock. To the extent that the options or warrants are exercised, additional shares of Gemphire common stock will be issued that will be eligible for resale in the public market, which will result in dilution to Gemphire's securityholders.

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        As described in the section entitled "Agreements Related to the Merger—Lock-Up Agreements" in this proxy statement/prospectus/information statement and as of September 30, 2019, Gemphire Stockholders holding approximately 14% of the outstanding Gemphire common stock and NeuroBo Stockholders holding approximately 90% of the outstanding NeuroBo capital stock on an as converted to common basis were parties to lock-up agreements restricting the disposition of their shares of Gemphire common stock and NeuroBo capital stock , respectively. Gemphire has filed an initial listing application with Nasdaq pursuant to Nasdaq "business combination" rules. In order to meet the requirements for listing on Nasdaq, the post-merger combined company will be required to satisfy Nasdaq's initial listing requirements, including the financial and liquidity requirements for the applicable Nasdaq market tier upon which the post-merger combined company's shares will trade following the merger. Due to recent changes in these listing requirements, certain Nasdaq market tiers and standards require companies seeking to list to demonstrate a minimum "Market Value of Unrestricted Publicly Held Shares" as of the effective time of the closing of a business combination. Per current Nasdaq rules and requirements, the "Market Value of Unrestricted Publicly Held Shares" may not include the value of any securities subject to resale restrictions, including the types of restrictions set forth in the Gemphire and NeuroBo lock-up agreements. The scope of the waiver of any restrictions in the lock-up agreements and the holders for whom these restrictions may be waived will depend on the then-current value and price of the Gemphire common stock as of the closing of the merger and is further discussed in the section entitled "Agreements Related to the Merger—Lock-Up Agreements" in this proxy statement/prospectus/information statement. The waiver of any lock-up restrictions may permit holders of Gemphire common stock previously subject to lock-up restrictions to dispose of some or all of their shares of Gemphire common stock following the closing of the merger. These dispositions could result in a reduction of the market price of the Gemphire common stock.

Provisions in Gemphire's corporate charter documents and under Delaware law could make an acquisition of Gemphire, which may be beneficial to its stockholders, more difficult and may prevent attempts by its stockholders to replace or remove its current management.

        Provisions in the Gemphire Certificate of Incorporation and the Gemphire Bylaws may discourage, delay or prevent a merger, acquisition or other change in control of Gemphire that stockholders may consider favorable, including transactions in which Gemphire Stockholders might otherwise receive a premium for their shares. These provisions could also limit the price that investors might be willing to pay in the future for shares of Gemphire common stock, thereby depressing the market price of Gemphire common stock. In addition, because the Gemphire Board is responsible for appointing the members of Gemphire's management team, these provisions may frustrate or prevent any attempts by Gemphire Stockholders to replace or remove its current management by making it more difficult for Gemphire Stockholders to replace members of the Gemphire Board. Among other things, these provisions:

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        Moreover, because Gemphire is incorporated in Delaware, Gemphire is governed by the provisions of Section 203 of the Delaware General Corporation Law, which prohibits a person who owns in excess of 15% of its outstanding voting stock from merging or combining with it for a period of three years after the date of the transaction in which the person acquired in excess of 15% of its outstanding voting stock, unless the merger or combination is approved in a prescribed manner.

An active trading market for Gemphire common stock may not be maintained.

        Gemphire common stock is currently traded on the Nasdaq Capital Market, but Gemphire can provide no assurance that Gemphire will be able to maintain an active trading market for its shares on the Nasdaq Capital Market or any other exchange in the future. If there is no active market for its common stock, it may be difficult for Gemphire Stockholders to sell shares without depressing the market price for the shares or at all.

If securities analysts do not publish research or reports about Gemphire's business or if they publish negative evaluations of Gemphire's stock, the price of Gemphire's stock could decline.

        If one or more of the analysts covering Gemphire's business downgrade their evaluations of its stock or publish inaccurate or unfavorable research about its business, the price of Gemphire's stock could decline. If one or more of these analysts cease to cover its stock, Gemphire could lose visibility in the market for its stock, which in turn could cause its stock price and trading volume to decline.

Gemphire's executive officers, directors, and their affiliates exercise significant control over Gemphire, which will limit the ability of Gemphire Stockholders to influence corporate matters and could delay or prevent a change in corporate control.

        As of September 30, 2019, Gemphire's officers, directors, and their respective affiliates had beneficial ownership, in the aggregate, of approximately 14% of its outstanding common stock.

        These stockholders, if they act together, may be able to influence Gemphire's management and affairs and control the outcome of matters submitted to Gemphire Stockholders for approval, including the election of directors, amendments of Gemphire's organizational documents, and any merger, consolidation, sale of all or substantially all of its assets or other major corporate transaction. Some of these stockholders acquired some or all of their shares of common stock for substantially less than the current trading price of its common stock, and these stockholders may have interests, with respect to Gemphire common stock, that are different from other Gemphire Stockholders. In addition, this concentration of ownership might adversely affect the market price of Gemphire common stock, have the effect of delaying, deferring or preventing a change of control of Gemphire, or discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of Gemphire.

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Gemphire is an "emerging growth company" and a "smaller reporting company" and Gemphire cannot be certain if the reduced reporting requirements applicable to such companies could make its common stock less attractive to investors.

        Gemphire is an "emerging growth company," as defined in the JOBS Act. For as long as Gemphire continues to be an emerging growth company, Gemphire may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies," including exemption from compliance with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (Sarbanes-Oxley Act), reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Under the JOBS Act, emerging growth companies can also delay adopting new or revised accounting standards until such time as those standards apply to private companies. Gemphire has irrevocably elected not to avail itself of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

        Gemphire will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of the IPO, (b) in which Gemphire has total annual gross revenue of at least $1.07 billion, or (c) in which Gemphire is deemed to be a large accelerated filer, which means the market value of its common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which Gemphire has issued more than $1 billion in non-convertible debt during the prior three-year period.

        Even after Gemphire no longer qualifies as an emerging growth company, Gemphire may still qualify as a "smaller reporting company," which would allow it to take advantage of many of the same exemptions from disclosure requirements, including reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements.

        Gemphire cannot predict if investors will find Gemphire common stock less attractive because Gemphire may rely on these exemptions. If some investors find Gemphire common stock less attractive as a result, there may be a less active trading market for Gemphire common stock and its stock price may be more volatile.

Gemphire incurs increased costs as a result of operating as a public company, and Gemphire's management is required to devote substantial time to compliance initiatives.

        As a public company, and particularly after Gemphire is no longer an "emerging growth company" or a "smaller reporting company," Gemphire incurs significant legal, accounting and other expenses. The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of the stock exchange upon which its common stock is listed and other applicable securities rules and regulations impose various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices. Gemphire's management and other personnel devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations increase its legal and financial compliance costs and make some activities more time-consuming and costly. However, these rules and regulations are often subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. Stockholder activism, the current political environment and the current high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead to additional

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compliance costs and impact the manner in which Gemphire operates its business in ways Gemphire cannot currently anticipate.

        Gemphire is subject to Section 404 of the Sarbanes-Oxley Act and the related rules of the SEC that generally require its management and independent registered public accounting firm to report on the effectiveness of its internal control over financial reporting. However, for so long as Gemphire remains an "emerging growth company" as defined in the JOBS Act or a "smaller reporting company", Gemphire intends to take advantage of certain exemptions from various reporting requirements that are applicable to public companies that are not emerging growth companies and/or smaller reporting companies, including, but not limited to, for emerging growth companies, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act. Once Gemphire is no longer an "emerging growth company" and if its public float is above $75 million as of the last business day of its most recently completed second fiscal quarter or, if before such date, Gemphire opts to no longer take advantage of the applicable exemption, Gemphire will be required to include an opinion from its independent registered public accounting firm on the effectiveness of its internal control over financial reporting.

        To achieve compliance with Section 404, Gemphire engaged in a process to document and evaluate its internal control over financial reporting, which is both costly and challenging. In this regard, Gemphire needs to continue to dedicate internal resources, hire additional finance and accounting personnel, potentially engage outside consultants and adopt a detailed work plan to assess and document the adequacy of internal control over financial reporting, continue steps to improve control processes as appropriate, validate through testing that controls are functioning as documented and implement a continuous reporting and improvement process for internal control over financial reporting. During the course of its review and testing, Gemphire may identify deficiencies and be unable to remediate them before Gemphire must provide the required reports. Gemphire or its independent registered public accounting firm may not be able to conclude on an ongoing basis that Gemphire has effective internal control over financial reporting, which could harm its operating results, cause investors to lose confidence in its reported financial information and cause the trading price of its stock to fall. Furthermore, if Gemphire has a material weakness in its internal control over financial reporting, Gemphire may not detect errors on a timely basis and its financial statements may be materially misstated.

        In addition, as a public company Gemphire is required to timely file accurate quarterly and annual reports with the SEC under the Exchange Act. In order to report its results of operations and financial statements on an accurate and timely basis, Gemphire will depend on CROs to provide timely and accurate notice of their costs to it. Any failure to report its financial results on an accurate and timely basis could result in sanctions, lawsuits, delisting of its shares from Nasdaq or other adverse consequences that would materially harm its business.

Gemphire does not anticipate declaring or paying, in the foreseeable future, any cash dividends on its capital stock and, consequently, the ability of Gemphire Stockholders to achieve a return on their investment will depend on appreciation in the price of Gemphire common stock.

        Gemphire has never declared or paid any cash dividend on its capital stock and does not currently intend to do so in the foreseeable future. Gemphire currently anticipates that it will retain future earnings for the development, operation and expansion of its business. Therefore, the success of an investment in shares of its common stock will depend upon any future appreciation in their value. There is no guarantee that shares of Gemphire common stock will appreciate in value or even maintain the price at which you purchased them.

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Gemphire's ability to utilize its NOL carryforwards and certain other tax attributes may be limited.

        Under the Tax Act, federal NOLs incurred in taxable years ending after December 31, 2017 may be carried forward indefinitely, but the deductibility of federal NOLs generated in such years is limited. It is uncertain if and to what extent various states will conform to the Tax Act. In addition, under Sections 382 and 383 of the Code, if a corporation undergoes an "ownership change," generally defined as a greater than 50% change (by value) in its equity ownership over a three-year period, the corporation's ability to use its pre-change NOL carryforwards and other pre-change tax attributes (such as research tax credits) to offset its post-change taxable income or taxes may be limited.

        As of December 31, 2018, Gemphire had approximately $20.0 million in U.S. federal and state NOL carryforwards that it may use in certain circumstances to offset future taxable income, if any, and thus reduce any federal and state income tax liability. The federal NOLs incurred prior to January 1, 2018 will begin to expire in 2034 if not utilized. Under the Tax Act, federal NOLs incurred after December 31, 2017 will not expire and may be carried forward indefinitely, but the deductibility of such NOLs is further limited. The state NOLs will begin to expire in 2026. Gemphire also had net tax credit carryforwards of $2.6 million and $0.1 million available to reduce future tax liabilities, if any, for U.S. federal and state purposes, respectively. In addition, Gemphire's ability to utilize these NOLs and tax credit carryforwards to offset future taxable income and tax liability may be significantly limited if it has experienced or if it experiences in the future an "ownership change," as defined in Section 382 of the Code and described above.

        Gemphire does not believe that it has experienced an ownership change as a result of its prior issuances. Nevertheless, the rules regarding the determination of whether an ownership change exists are complicated and are subject to differing interpretations, and it is possible that one or more of such issuances might be treated as having resulted in an ownership change. Gemphire has not completed a study to assess whether an ownership change for purposes of Section 382 has occurred, or whether there have been multiple ownership changes since its inception, due to the significant costs and complexities associated with such study. In addition, the merger, if consummated, is expected to constitute an ownership change within the meaning of Section 382 of the Code, thereby substantially limiting Gemphire's future utilization of its NOL carryforwards and tax credit carryforwards.

Gemphire's amended and restated bylaws designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by Gemphire Stockholders, which could limit Gemphire Stockholders' ability to obtain a favorable judicial forum for disputes with Gemphire or its directors, officers or employees.

        Gemphire's amended and restated bylaws provide that, unless Gemphire consents 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 any derivative action or proceeding brought on its behalf, any action asserting a claim of breach of a fiduciary duty owed by any of its directors, officers or other employees to Gemphire or Gemphire Stockholders, any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, as amended, or any other action asserting a claim governed by the internal affairs doctrine. This provision is not intended to apply to claims arising under the Securities Act and the Exchange Act. To the extent the provision could be construed to apply to such claims, there is uncertainty as to whether a court would enforce the provision in such respect, and our stockholders will not be deemed to have waived compliance with federal securities laws and the rules and regulations thereunder. Any person or entity purchasing or otherwise acquiring any interest in shares of Gemphire capital stock shall be deemed to have notice of and to have consented to the provisions of its amended and restated bylaws described above. This choice of forum provision may limit a Gemphire Stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with Gemphire or Gemphire's directors, officers or other employees, which may discourage such lawsuits against Gemphire and its directors, officers and employees. Alternatively, if a court were

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to find this provision inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, Gemphire may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect Gemphire's business and financial condition.

Unstable market and economic conditions may have serious adverse consequences on Gemphire's business, financial condition and stock price.

        The global credit and financial markets have experienced extreme volatility and disruptions in the past several years, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty about economic stability. Gemphire cannot assure you that further deterioration in credit and financial markets and confidence in economic conditions will not occur. Gemphire's general business strategy may be adversely affected by any such economic downturn, volatile business environment or continued unpredictable and unstable market conditions. If the current equity and credit markets deteriorate, or do not improve, it may make any necessary debt or equity financing more difficult, more costly, and more dilutive. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on Gemphire's growth strategy, financial performance and stock price and could require it to delay or abandon clinical development plans. In addition, there is a risk that one or more of Gemphire's current service providers, manufacturers and other partners may not survive these difficult economic times, which could directly affect Gemphire's ability to attain its operating goals on schedule and on budget.

Risks Related to NeuroBo

Risks Related to NeuroBo's Financial Position and Need for Additional Capital

NeuroBo has incurred losses since its inception. NeuroBo expects to continue to incur losses and may never generate profits from operations or maintain profitability.

        Since inception, NeuroBo has incurred operating losses. NeuroBo's net losses were $15.5 million for the year ended December 31, 2018, and $4.4 million for the six months ended June 30, 2019. As of June 30, 2019, NeuroBo had an accumulated deficit of $19.9 million. To date, NeuroBo has financed its operations primarily through issuances of shares of common stock and preferred stock and convertible promissory notes. NeuroBo has not generated any revenue from product sales to date. NeuroBo has devoted substantially all of its efforts to research and development, including clinical trials. NeuroBo has not completed the development of any drugs. NeuroBo expects to continue to incur significant expenses and increasing operating losses for at least the next few years as NeuroBo conducts additional clinical trials for its product candidates; continues to discover and develop additional product candidates; acquires or in-licenses other product candidates and technologies; maintains, expands and protects its intellectual property portfolio; hires additional clinical, scientific and commercial personnel; establishes a commercial manufacturing source and secures supply chain capacity sufficient to provide commercial quantities of any product candidates for which it may obtain regulatory approval; seeks regulatory approvals for any product candidates that successfully complete clinical trials; establishes a sales, marketing and distribution infrastructure to commercialize any products for which it may obtain regulatory approval; and adds operational, financial and management information systems and personnel, including personnel to support its product development and planned future commercialization efforts, as well as to support its transition to a public reporting company. NeuroBo may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect its business. The size of NeuroBo's future net losses will depend, in part, on the rate of future growth of its expenses and its ability to generate revenues. Even if NeuroBo achieves profitability in the future, NeuroBo may not be able to sustain profitability in subsequent periods. The net losses NeuroBo incurs may fluctuate significantly from quarter to quarter and year to year.

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        NeuroBo's ability to generate profits from operations and thereafter to remain profitable depends heavily on:

        Based on NeuroBo's current plans, NeuroBo does not expect to generate significant revenue from product sales unless and until NeuroBo or a potential future licensee or collaborator obtains marketing approval for, and commercializes, one or more of NeuroBo's current or potential future product candidates. Neither NeuroBo nor a licensee may ever succeed in obtaining marketing approval for, or commercializing, NeuroBo's product candidates and, even if it does, NeuroBo may never generate revenues that are significant enough to yield profits from operations. Even if NeuroBo does generate profits from operations, it may not be able to sustain or increase profitability on a quarterly or annual basis. NeuroBo's failure to generate profits from operations and remain profitable would decrease its value and could impair its ability to raise capital, expand its business, maintain its research and development efforts, diversify its product offerings or continue its operations. A decline in NeuroBo's value could also cause you to lose all or part of your investment.

NeuroBo's limited operating history may make it difficult for you to evaluate the success of NeuroBo's business to date and to assess its future viability.

        NeuroBo was formed in 2017 and did not conduct significant operations until 2018. NeuroBo's operations to date have been limited to organizing the company, entering into licensing arrangements for NB-01, hiring a team of experienced personnel, raising capital, and undertaking nonclinical studies and clinical trials and regulatory activities for its development programs, primarily NB-01. NeuroBo has not yet demonstrated its ability to successfully complete development of any product candidate, including the large-scale, pivotal clinical trials that will be required for regulatory approval of its product candidates, obtain marketing approvals, manufacture a commercial scale product, or arrange

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for a third party to do so on its behalf, or conduct sales and marketing activities necessary for successful product commercialization. It takes many years to develop one new product from the time it is discovered to when it is commercially available, if ever. Consequently, any early predictions made about NeuroBo's future success or viability may not be as accurate as they could be if NeuroBo had a longer operating history.

        As an early-stage company, NeuroBo may encounter unforeseen expenses, difficulties, complications, delays and other known and unknown factors that may alter or delay its plans. Assuming NeuroBo completes the clinical development of, and obtains marketing approval for, any of its product candidates, NeuroBo will need to transition from a company with a research and development focus to a company capable of supporting commercial activities. NeuroBo may encounter unforeseen expenses, difficulties, complications and delays and may not be successful in such a transition.

NeuroBo may not be able to attract a strategic partner or find other funding sources for the advancement of its lead product candidate, NB-01, through Phase 3 clinical development. If NeuroBo is unable to identify a partner or other funding sources that are willing to provide the financial resources to support the development of NB-01, or if NeuroBo experiences significant delays in identifying such a partner or funding source, NeuroBo's business and that of the combined organization could be adversely affected.

        NeuroBo is dependent on the success of its lead product candidate, NB-01. NeuroBo's current financial resources are insufficient to complete the Phase 3 clinical development of NB-01. NeuroBo plans to commence the Phase 3 clinical development of NB-01 in the first quarter of 2020, and it intends to explore various avenues to advance NB-01, including securing a pharmaceutical strategic partner or exploring other means for advancing NB-01 that would make available sufficient financial resources to complete the Phase 3 studies.

        NeuroBo may not be able to attract a pharmaceutical strategic partner or other funding sources to support the development of NB-01. As is common in the biopharmaceutical industry, NeuroBo faces significant competition in seeking strategic collaborators. Collaborations are complex and time-consuming to negotiate and document. No assurance can be given that any efforts NeuroBo makes to seek strategic partners or funding sources for the advancement of NB-01 will be successfully completed on commercially reasonable terms, on a timely basis or at all.

        If NeuroBo is unable to negotiate a favorable partnership or funding arrangement, NeuroBo may have to curtail the development of NB-01, reduce the scope of or delay its intended development programs, or increase expenditures and undertake development activities at its own expense. If NeuroBo elects to increase its expenditures to fund development activities on its own, NeuroBo would need to obtain additional capital, which may not be available to it on acceptable terms or at all. If NeuroBo does not have sufficient funds to advance NB-01, it may not be able to bring its product candidates to market and generate product revenue.

NeuroBo will require substantial additional funding. If NeuroBo is unable to raise capital when needed, NeuroBo could be forced to delay, reduce or eliminate any product development programs or commercialization efforts.

        NeuroBo's operations have consumed a large amount of cash since inception. NeuroBo expects its research and development expenses to increase substantially in future periods as NeuroBo continues to advance the clinical development of its product candidates and prepares for the launch and commercialization of any product candidates for which it receives regulatory approval, including potentially building its own commercial organization to address the markets for its products. In addition, if NeuroBo obtains marketing approval for any of its product candidates that are not then subject to licensing, collaboration or similar arrangements with third parties, NeuroBo expects to incur significant commercialization expenses related to product sales, marketing, distribution and

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manufacturing. Furthermore, NeuroBo will incur additional costs associated with operating as a public company in the United States. Accordingly, NeuroBo will need to obtain substantial additional funding in connection with its continuing operations.

        NeuroBo cannot be certain that additional funding will be available on acceptable terms, or at all. If NeuroBo is unable to raise additional capital when needed or in sufficient amounts or on terms acceptable to it, NeuroBo could be forced to delay, reduce or eliminate its research and development programs or any future commercialization efforts of one or more of its product candidates or one or more of its other research and development initiatives. NeuroBo also could be required to:

        NeuroBo's future funding requirements, both near and long-term, will depend on many factors, including, but not limited to:

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        Conducting preclinical testing and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete, and NeuroBo may never generate the necessary data or results required to obtain marketing approval and achieve product sales. In addition, NeuroBo's product candidates, if approved, may not achieve commercial success. NeuroBo's commercial revenues, if any, will be derived from sales of products that will not be commercially available for sale by NeuroBo for at least the next few years, if at all. Accordingly, NeuroBo will need to continue to rely on additional financing to achieve its business objectives. In addition, NeuroBo may seek additional capital due to favorable market conditions or strategic considerations, even if NeuroBo believes that it has sufficient funds for its current or future operating plans. Additional financing may not be available to NeuroBo on acceptable terms, or at all. The unavailability of additional financing on acceptable terms, or at all, would have an adverse effect on your investment.

NeuroBo's independent registered public accounting firm has included an explanatory paragraph relating to NeuroBo's ability to continue as a going concern in its report on NeuroBo's audited financial statements included in this proxy statement/prospectus/information statement.

        The report from NeuroBo's independent registered public accounting firm for the year ended December 31, 2018 includes an explanatory paragraph stating that NeuroBo's recurring losses from operations and net capital deficiency raise substantial doubt about NeuroBo's ability to continue as a going concern. If NeuroBo is unable to obtain sufficient funding, its business, prospects, financial condition and results of operations will be materially and adversely affected and NeuroBo and the combined organization may be unable to continue as a going concern. If NeuroBo is unable to continue as a going concern, NeuroBo may have to liquidate its assets and may receive less than the value at which those assets are carried on its audited financial statements, and it is likely that investors will lose all or a part of their investment. After the Closing of the merger, future reports from the combined organization's independent registered public accounting firm may also contain statements expressing substantial doubt about its ability to continue as a going concern. If NeuroBo seeks additional financing to fund its business activities in the future and there remains substantial doubt about its ability to continue as a going concern, investors or other financing sources may be unwilling to provide additional funding to NeuroBo on commercially reasonable terms or at all.

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NeuroBo has identified a material weakness in its internal control over financial reporting that could, if not remediated, result in material misstatements in its financial statements or impair NeuroBo's ability to produce accurate and timely consolidated financial statements, its operating results or its ability to operate its business.

        Ensuring that NeuroBo has adequate internal financial and accounting controls and procedures in place so that we can produce accurate consolidated financial statements on a timely basis is a costly and time-consuming effort that needs to be evaluated frequently. As a private company, NeuroBo has not historically prepared public company financial statements. In connection with the audit of NeuroBo's consolidated financial statements as of and for the year ended December 31, 2018, NeuroBo concluded that there is a material weakness relating to its internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the company's annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

        Specifically, NeuroBo identified a material weakness relating to accounting for its clinical trial expenses. Although NeuroBo has begun to take measures to remediate this material weakness and believes that it will be able to remediate the material weakness by the end of the fiscal year ending December 31, 2019, the measures it has taken, and expects to take, to improve the company's internal controls may not be sufficient to address the issues identified, to ensure that the company's internal controls are effective or to ensure that the identified material weakness will not result in a material misstatement of NeuroBo's annual or interim consolidated financial statements. If NeuroBo is unable to correct material weaknesses or deficiencies in internal controls in a timely manner, its ability to record, process, summarize and report financial information accurately and within the time periods specified in the rules and forms of the SEC, will be adversely affected. This failure could negatively affect the market price and trading liquidity of the NeuroBo common stock, cause investors to lose confidence in NeuroBo's reported financial information, subject NeuroBo to civil and criminal investigations and penalties, and materially and adversely impact the company's business and financial condition.

Raising additional capital may cause dilution to the combined organization's investors, restrict its operations or require it to relinquish rights to its technologies or product candidates. Future debt obligations may expose NeuroBo to risks that could adversely affect its business, operating results and financial condition and may result in further dilution to the combined organization's stockholders.

        Until such time, if ever, as NeuroBo can generate substantial product revenues, NeuroBo expects to finance its cash needs through a combination of equity offerings, debt financings, and licensing, collaboration or similar arrangements. NeuroBo does not have any committed external sources of funds and may seek to raise additional capital at any time. To the extent that NeuroBo raises additional capital through the sale of equity or convertible debt securities, your ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a holder of its common stock. Debt financing, if available, may involve agreements that include covenants limiting or restricting NeuroBo's ability to take specific actions, such as incurring additional debt, making capital expenditures, declaring dividends or other distributions, acquiring or licensing intellectual property rights and other operating restrictions that could adversely impact NeuroBo's ability to conduct its business and may result in liens being placed on its assets and intellectual property. If NeuroBo defaults on such indebtedness, NeuroBo could lose such assets and intellectual property.

        If NeuroBo raises additional funds through licensing, collaboration or similar arrangements with third parties, NeuroBo may have to relinquish valuable rights to its technologies, future revenue streams, research and development programs or product candidates or grant licenses on terms that are not favorable to NeuroBo. If NeuroBo is unable to raise additional funds through equity or debt financings or through licensing, collaboration or similar arrangements when needed, NeuroBo may be

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required to delay, limit, reduce or terminate its product development or future commercialization efforts or grant rights to develop and market product candidates that NeuroBo would otherwise prefer to develop and market itself.

NeuroBo has not generated any revenues since inception and will not generate any revenues for the foreseeable future. NeuroBo may never become profitable.

        To date, NeuroBo has not generated any revenues. NeuroBo's ability to generate revenue and become profitable depends upon its ability to successfully obtain marketing approval and commercialize its product candidates, including NB-01, NB-02 or other product candidates that NeuroBo may develop, in-license or acquire in the future. Even if NeuroBo is able to successfully achieve regulatory approval for these product candidates, NeuroBo is unable to predict the extent of any future losses and does not know when any of these product candidates will generate revenue for NeuroBo, if at all. NeuroBo's ability to generate revenue from NB-01 or other product candidates also depends on a number of additional factors, including its ability to:

        In addition, because of the numerous risks and uncertainties associated with product development, including the possibility that NeuroBo's product candidates may not advance through development or demonstrate safety and efficacy for their intended uses, the FDA or any other regulatory agency may require additional clinical trials or nonclinical studies to be completed before a new drug marketing application can be filed. NeuroBo is unable to predict the timing or amount of increased expenses, or when or if NeuroBo will be able to achieve or maintain profitability, and such expense could increase beyond its expectations if the FDA or any other regulatory agency requires such additional clinical trials or nonclinical studies as part of the application and approval process, or as a post-approval requirement if NeuroBo is successful at achieving regulatory approval. Even if NeuroBo is able to successfully complete the development and regulatory reviews described above, NeuroBo anticipates incurring significant costs associated with commercializing these products, if they are approved.

        Even if NeuroBo is able to generate revenues from the sale of its product candidates, NeuroBo may not become profitable and may need to obtain additional funding to continue operations. If NeuroBo fails to become profitable or is unable to sustain profitability on a continuing basis, then NeuroBo may be unable to continue its operations at planned levels and be forced to reduce its operations. If NeuroBo does achieve profitability, NeuroBo may not be able to sustain or increase profitability on a quarterly or annual basis. NeuroBo's failure to become and remain profitable would

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decrease the value of the company and could impair its ability to raise capital, maintain its discovery and preclinical development efforts, expand its business or continue its operations and may require it to raise additional capital that may dilute your ownership interest. A decline in the value of NeuroBo could also cause you to lose all or part of your investment.

Risks Related to Development and Commercialization of NeuroBo's Product Candidates

NeuroBo depends heavily on the success of its lead product candidate, NB-01, which is in clinical development, and NeuroBo may not be able to successfully obtain regulatory or marketing approval for, or successfully commercialize, this or any other product candidate.

        NeuroBo's business depends heavily on the successful clinical development, regulatory approval and commercialization of NB-01. NeuroBo currently has no drug product for sale and may never be able to develop marketable drug products. NeuroBo plans to initiate a global Phase 3 pivotal trial of NeuroBo's lead product candidate, NB-01, in diabetic patients suffering from painful diabetic neuropathy (PDN) in the first quarter of 2020, and may be required to complete additional nonclinical studies and clinical trials before NeuroBo can seek regulatory approval for the treatment of this patient population. NeuroBo's other product candidate, NB-02, is still in the preclinical development stage. The clinical trials of NeuroBo's product candidates are, and the manufacturing and marketing of its product candidates will be, subject to extensive and rigorous review and regulation by government authorities in the United States and in other countries where NeuroBo intends to test and, if approved, market any product candidate. Before obtaining regulatory approvals for the commercial sale of any product candidate, NeuroBo must successfully meet a number of critical developmental milestones, including:

        The time necessary to achieve these developmental milestones for any individual product candidate is long and uncertain, and NeuroBo may not successfully complete these milestones for NB-01, NB-02, or any other product candidates that NeuroBo may develop. NeuroBo has not yet completed development of any product candidate. Moreover, NB-01 is considered a "botanical drug product" by the FDA, which results in the drug candidate having unique features that must be taken into account during the drug development process. Botanical drug products may be heterogeneous in nature and may carry additional uncertainty about their active constituents in comparison to synthetic small-molecule drug products. Accordingly, the FDA may impose additional requirements on NeuroBo in order to confirm that the final formulation of NB-01 is able to demonstrate the necessary therapeutic consistency to support the marketing of a safe and effective commercial drug product. The complexities of developing botanical drug products may increase the time and costs associated with the development of NeuroBo's product candidates.

        NeuroBo is continuing to test and develop its product candidates and may explore possible design or formulation changes to address safety, efficacy, manufacturing efficiency and performance issues to the extent any arise. NeuroBo may not be able to complete development of any product candidates

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that demonstrate safety and efficacy and that will have a commercially reasonable treatment and storage period. If NeuroBo is unable to complete development of NB-01, NB-02, or any other product candidates that NeuroBo may develop, NeuroBo will not be able to commercialize and earn revenue from them.

The regulatory review and approval processes of the FDA and comparable foreign regulatory authorities are lengthy, time-consuming and inherently unpredictable, and if NeuroBo is ultimately unable to obtain regulatory approval for its product candidates, including pursuant to the guidelines applicable to NB-01 and NB-02 as botanical drug products, its business will be substantially harmed.

        Of the large number of drugs in development in the United States, only a small percentage receive FDA regulatory approval and are commercialized in the United States. NeuroBo is not permitted to market NB-01, NB-02 or any other product candidate in the United States until NeuroBo receives approval of an NDA from the FDA, or in any foreign countries until NeuroBo receives the requisite approval from such countries or jurisdictions, such as the marketing authorization application, or MAA, in the European Union from the European Medicines Agency, or EMA. Prior to submitting an NDA to the FDA for approval of NB-01 for the treatment of painful diabetic neuropathy, NeuroBo will need to successfully complete the planned Phase 3 clinical trials of NB-01 in patients with painful diabetic neuropathy and potentially may need to undertake additional clinical trials and/or nonclinical studies. Successfully completing clinical trials and obtaining approval of an NDA is a complex, lengthy, expensive and uncertain process, and the FDA, or a comparable foreign regulatory authority, may delay, limit or deny approval of NB-01 for the treatment of painful diabetic neuropathy or other indications for many reasons, including, among others:

        Further, NB-01 is derived from two plant species native to China, and as such is considered a botanical drug product. The FDA has specific requirements and technical standards for botanical drugs, with which NeuroBo will be obliged to comply in the clinical development of NB-01, including with

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respect to the quality and therapeutic consistency standards for the product candidate that will be used in clinical trials. NeuroBo cannot assure you that it will be able to meet the standards to which it will be held for these purposes.

        The FDA or a comparable foreign regulatory authority may also require more information, including additional nonclinical or clinical data to support approval, which may delay or prevent approval and NeuroBo's commercialization plans, or cause NeuroBo to abandon the development program. Even if NeuroBo obtains regulatory approval, its product candidates may be approved for fewer or more limited indications than NeuroBo requests, such approval may be contingent on the performance of costly post-marketing clinical trials, or NeuroBo may not be allowed to include the labeling claims necessary or desirable for the successful commercialization of such product candidate. For instance, it is possible that NB-01 could be approved for an indication but fail to be used for treating patients in that indication due to the availability of other available treatments or then-accepted clinical practice.

NeuroBo depends on its license agreement with Dong-A ST to permit NeuroBo to use patents and patent applications relating to NB-01. Termination of these rights or the failure to comply with obligations under this agreement could materially harm NeuroBo's business and prevent it from developing or commercializing its product candidates.

        NeuroBo is a party to a license agreement with Dong-A ST under which NeuroBo was granted rights to patents and patent applications that are important to its business. NeuroBo relies on this license agreement in order to be able to use various proprietary technologies that are material to its business, including certain patents and patent applications that cover NB-01. NeuroBo's rights to use these patents and patent applications and employ the inventions claimed in these licensed patents are subject to the continuation of and its compliance with the terms of its license agreement.

        NeuroBo's license agreement with Dong-A ST imposes upon NeuroBo various diligence, payment and other obligations, including the following:

        If NeuroBo fails to comply with any of its obligations under the Dong-A ST license agreement, or NeuroBo is subject to a bankruptcy, Dong-A ST may have the right to terminate the license agreement, in which event NeuroBo would not be able to market any product candidates covered by the license.

        Disputes may arise under NeuroBo's license agreement with Dong-A ST regarding the intellectual property that is subject to such license agreement, including:

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        If disputes over intellectual property that NeuroBo has licensed prevent or impair its ability to maintain any of its license agreements on acceptable terms, NeuroBo may be unable to successfully develop and commercialize the affected product candidates and technologies.

The results of clinical trials may not support NeuroBo's product candidate claims.

        Even if NeuroBo's clinical trials are completed as planned, NeuroBo cannot be certain that their results will support the proposed product candidates, that the FDA or foreign government authorities will agree with NeuroBo's conclusions regarding such results, or that the FDA or foreign governmental authorities will not require additional clinical trials. Success in preclinical testing and early clinical trials does not ensure that later clinical trials will be successful, and the results of later clinical trials often do not replicate the results of prior clinical trials and preclinical testing. The clinical trial results may fail to demonstrate that NeuroBo's product candidates are safe for humans and effective for their intended indications. This failure could cause NeuroBo to abandon a product candidate and may delay development of other product candidates. Any delay in, or termination of, NeuroBo's clinical trials will delay or prevent the submission of any marketing applications and, ultimately, its ability to obtain approval and commercialize its product candidates and generate product revenues. Information about certain clinical trials, including the results of those trials, will be made public according to each country's clinical trial register policies (www.clinicaltrials.gov or EU's clinical trial database, EudraCT). Competitors may use this publicly available information to gain knowledge regarding the progress of development programs.

NeuroBo's lead product candidate, NB-01, is only part way through the clinical trials NeuroBo anticipates needing to complete before NeuroBo may be able to submit an NDA to the FDA for this potential therapeutic product. Clinical drug development involves a lengthy and expensive process with an uncertain outcome, and results of early studies and trials may not be predictive of later trial results.

        Preclinical and other nonclinical testing and clinical trials are long, expensive and unpredictable processes that are difficult to design and implement, are subject to delays and are uncertain as to outcome. It may take several years to complete the nonclinical testing and clinical development necessary to obtain approval and commercialize a drug, and failure can occur at any stage of testing. Early and interim results of clinical trials do not necessarily predict final results. In particular, the small number of subjects and patients in NeuroBo's early clinical trials may make the results of these clinical trials less predictive of the outcome of later larger clinical trials. The design of a clinical trial may be able to determine whether its results will support approval of a product, and flaws in the design of a clinical trial may not become apparent until the clinical trial is well advanced or completed. There is no assurance that NeuroBo will be able to design and complete a clinical trial to support marketing approval. Moreover, nonclinical and clinical data are often susceptible to multiple interpretations and analyses. A number of companies in the pharmaceutical and biotechnology industries have experienced significant setbacks in advanced clinical trials, even after promising results in earlier trials.

Delays in NeuroBo's clinical trials may lead to a delay in the submission of marketing approval applications and jeopardize its ability to potentially receive approvals and generate revenues from the sale of its products.

        NeuroBo may experience delays in its current or future clinical trials, including its Phase 3 trials of NB-01 for the treatment of diabetic neuropathy and clinical trials of NB-02, which is in development for the symptomatic and disease modifying treatment of neurodegenerative diseases, including Alzheimer's disease and tauopathies. NeuroBo does not know whether planned clinical trials will begin or enroll subjects on time, need to be redesigned or be completed on schedule, if at all. Clinical trials may be delayed, suspended or terminated for a variety of reasons, such as:

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        Any delays in completing NeuroBo's clinical trials will increase its costs, slow down its product candidate development and approval process and jeopardize its ability to commence product sales and generate revenues. Any of these occurrences may significantly harm NeuroBo's business, financial condition and prospects. In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of NeuroBo's product candidates.

The development of NeuroBo's product candidates is dependent upon securing sufficient quantities of Dioscorea Rhizome and Dioscoreae Nipponicae Rhizoma, which are two plant species native to China.

        The therapeutic components of NeuroBo's product candidate, NB-01, Dioscorea Rhizome and Dioscoreae Nipponicae Rhizoma, are cultivated for NeuroBo in China and Korea. NeuroBo currently secures these components exclusively from Dong-A ST. NeuroBo's current supply agreement with Dong-A ST expires on September 28, 2023, unless extended by mutual agreement of NeuroBo and Dong-A ST. There can be no assurances that Dioscorea Rhizome and Dioscoreae Nipponicae Rhizoma will continue to grow in sufficient quantities to meet commercial supply requirements or that the countries from which NeuroBo can secure Dioscorea Rhizome and Dioscoreae Nipponicae Rhizoma will continue to allow the exportation of these components. In the event NeuroBo is no longer able to obtain these products from Dong-A ST, or in sufficient quantities, NeuroBo may not be able to produce its proposed products and its business will be adversely affected.

        Further, because Dioscorea Rhizome and Dioscoreae Nipponicae Rhizoma are imported from China and Korea, any trade policies or rules that impose conditions or restrictions on the importation of

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natural products from those regions may restrict or prevent the timely delivery of these products to NeuroBo, which would adversely affect its business.

NeuroBo's business may be negatively affected by weather conditions and the availability of natural resources, as well as by climate change.

        In recent years, extreme weather events and changing weather patterns such as storms, flooding, drought, and temperature changes, appear to have become more common. The production of Dioscorea Rhizome and Dioscoreae Nipponicae Rhizoma depends on the availability of natural resources, including sufficient rainfall. NeuroBo's exclusive supplier of these components, Dong-A ST, could be adversely affected if it experiences a shortage of fresh water due to droughts or other weather conditions. As a result of such events, NeuroBo could experience shortages of the necessary components of its products, which could have a material adverse effect on its business, financial condition and results of operations.

NeuroBo's research and development efforts are focused on the treatment of neurodegenerative conditions and diseases, a field that to date has seen limited success in drug development. Further, NeuroBo's product candidates are based on new approaches and novel technology, which makes it difficult to predict the time and cost of product candidate development and subsequently obtaining regulatory approval.

        NeuroBo has focused its research and development efforts on addressing neurodegenerative conditions and diseases. Collectively, efforts by biopharmaceutical companies in the field of neurodegenerative conditions and diseases have seen limited success in drug development to date. There are few effective therapeutic options available for patients with Alzheimer's disease and other neurodegenerative diseases and conditions. NeuroBo's future success is highly dependent on the successful development of its technology and its product candidates for treating neurodegenerative conditions and diseases. Developing and, if approved, commercializing NeuroBo's product candidates for treatment of neurodegenerative diseases subjects it to a number of challenges, including obtaining regulatory approval from the FDA and other regulatory authorities who have only a limited set of precedents on which to rely.

        NeuroBo cannot be sure that its approach will yield satisfactory therapeutic products that are safe and effective, scalable, or profitable. Moreover, public perception of drug safety issues, including adoption of new therapeutics or novel approaches to treatment, may adversely influence the willingness of subjects to participate in clinical trials, or if approved, of physicians to subscribe to novel treatments.

NeuroBo may fail to enroll a sufficient number of patients in its clinical trials in a timely manner, which could delay or prevent clinical trials of its product candidates.

        Identifying and qualifying patients to participate in clinical trials of NeuroBo's product candidates is critical to its success. The timing of NeuroBo's clinical trials depends on the rate at which NeuroBo can recruit and enroll patients in testing its product candidates. The timing of NeuroBo's clinical trials depends in part on the speed at which NeuroBo can recruit patients to participate in testing NB-01 and any other current or future product candidates that NeuroBo may develop, as well as successful completion of any required follow-up visits with trial subjects. If NeuroBo cannot identify patients to participate in its clinical trials or if patients are unwilling to participate in its clinical trials for any reason, including if patients choose to enroll in competitive clinical trials for similar patient populations, the timeline for recruiting patients, conducting studies and obtaining regulatory approval of NB-01 and any other current or future product candidates that NeuroBo may develop may be delayed. These delays could result in increased costs, delays in advancing NeuroBo's current or future product candidates, including NB-01 and NB-02, delays in testing the effectiveness of its product candidates or termination of the clinical trials altogether.

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        NeuroBo may not be able to identify, recruit and enroll a sufficient number of patients, or those with required or desired characteristics to achieve diversity in a trial, to complete its clinical trials in a timely manner. The eligibility criteria of NeuroBo's clinical trials will further limit the pool of available trial participants.

        Patient enrollment, a significant factor in the duration of clinical trials, is also affected by many factors, including:

        NeuroBo has made certain assumptions about the rate at which NeuroBo can enroll patients in its clinical trials. To the extent that NeuroBo does not meet this enrollment target, NeuroBo's projected timeline for development of NeuroBo's product candidates may be slowed. NeuroBo relies on third-party CROs and clinical trial sites to ensure the proper and timely conduct of its clinical trials, and while NeuroBo will have agreements governing their activities, NeuroBo has limited control over the actual performance of those third-party research and development partners.

        If NeuroBo experiences difficulty enrolling a sufficient number of patients to conduct its clinical trials as planned, it may be forced to delay, limit or terminate ongoing or planned clinical trials of its product candidates, which would delay its ability to obtain approvals and generate product revenues from any of these product candidates.

If NeuroBo experiences any of a number of possible unforeseen events in connection with its clinical trials, potential marketing approval or commercialization of its product candidates, or entry into licensing, collaboration or similar arrangements, could be delayed or prevented.

        NeuroBo may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent its ability to receive marketing approval or commercialize its product candidates, including:

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        NeuroBo's product development costs will increase if NeuroBo experiences delays in testing or marketing approvals. NeuroBo does not know whether any preclinical tests or clinical trials will begin as planned, will need to be redesigned or will be completed on schedule, or at all. Significant preclinical study or clinical trial delays also could shorten any periods during which NeuroBo may have the exclusive right to commercialize its product candidates, if they are approved, or allow its competitors to bring products to market before NeuroBo does and impair NeuroBo's ability to successfully commercialize its product candidates, which may harm its business and results of operations.

NeuroBo may expend its limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success.

        Because NeuroBo has limited financial and managerial resources, NeuroBo focuses on specific product candidates. Currently, NeuroBo is focusing its resources predominantly on NB-01 for the treatment of painful diabetic neuropathy and NB-02, which is in development for the symptomatic and disease modifying treatment of neurodegenerative diseases, including Alzheimer's disease and tauopathies. As a result, NeuroBo may forego or delay pursuit of opportunities with other product candidates or for other indications that have or that could later prove to have greater commercial potential. NeuroBo's resource allocation decisions may cause it to fail to capitalize on viable commercial products or alternate and/or profitable market opportunities. NeuroBo's spending on current and future research and development programs and product candidates for specific indications may not yield any commercially viable products. If NeuroBo does not accurately evaluate the commercial potential or target market for a particular product candidate, NeuroBo may relinquish

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valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for NeuroBo to retain sole development and commercialization rights to such product candidate.

Risks Related to the Marketing and Commercialization of NeuroBo's Product Candidates

If NeuroBo is unable to establish sales and marketing capabilities to market and sell its product candidates, if they are approved for such marketing, NeuroBo may be unable to generate any revenue.

        Even if NeuroBo is ultimately successful in obtaining regulatory approval of NB-01 for the treatment of painful diabetic neuropathy, in order to market and sell NB-01 and its other product candidates in development, NeuroBo currently intends to build and develop its own sales, marketing and distribution operations. Although NeuroBo's management team has previous experience with such efforts, there can be no assurance that NeuroBo will be successful in building these operations. The establishment and development of NeuroBo's own commercial sales and marketing teams to discuss any products NeuroBo may develop will be expensive and time-consuming and could delay any product launch.

        If NeuroBo is unable to establish adequate sales, marketing and distribution capabilities, NeuroBo may not be able to generate product revenue and may not become profitable. NeuroBo will also be competing with many companies that currently have extensive and well-funded sales and marketing operations. If any of NeuroBo's product candidates are approved, NeuroBo may be unable to compete successfully against these more established companies.

NeuroBo's commercial success depends upon attaining significant market acceptance of its product candidates, if approved, among hospitals, physicians, patients and healthcare payors.

        Even if NeuroBo obtains regulatory approval for any of its product candidates that NeuroBo may develop or acquire in the future, the product may not gain market acceptance among hospitals, physicians, health care payors, patients and the medical community. Market acceptance of any of NeuroBo's product candidates for which NeuroBo receives approval depends on a number of factors, including:

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        There may be delays in getting NeuroBo's product candidates, if approved, on hospital or insurance formularies or limitations on coverages that may be available in the early stages of commercialization for newly approved drugs. If any of NeuroBo's product candidates are approved but fail to achieve market acceptance among hospitals, physicians, patients or health care payors, NeuroBo will not be able to generate significant revenues, which would have a material adverse effect on its business, prospects, financial condition and results of operations.

Product candidates may cause undesirable side effects that could delay or prevent their marketing approval, limit the commercial profile of an approved label, or result in significant negative consequences following marketing approval, if any, including marketing withdrawal.

        Undesirable side effects caused by any of NeuroBo's product candidates that NeuroBo may develop or acquire could cause NeuroBo or the FDA or other regulatory authorities to interrupt, delay or halt NeuroBo's clinical trials and could result in more restrictive labels or the delay or denial of marketing approval by the FDA or other regulatory authorities of such product candidates. Results of NeuroBo's clinical trials could reveal a high and unacceptable severity and prevalence of these or other side effects. In such an event, NeuroBo's trials could be suspended or terminated and the FDA or comparable foreign regulatory authorities could order NeuroBo to cease further development of or deny approval of its product candidates for any or all targeted indications. In addition, any drug-related side effects could affect patient recruitment or the ability of enrolled patients to complete the trial or result in potential product liability claims. Any of these occurrences may harm NeuroBo's business, financial condition and prospects significantly.

        Further, clinical trials by their nature utilize a sample of the potential patient population. With a limited number of patients, rare and severe side effects of NeuroBo's product candidates may only be uncovered with a significantly larger number of patients exposed to the product candidate. If NeuroBo's product candidates receive marketing approval and NeuroBo or others identify undesirable side effects caused by such product candidates (or any other similar drugs) after such approval, a number of potentially significant negative consequences could result, including:

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        NeuroBo believes that any of these events could prevent it from achieving or maintaining market acceptance of the affected product candidates and could substantially increase the costs of commercializing its product candidates, if approved, and significantly impact its ability to successfully commercialize its product candidates and generate revenues.

NeuroBo's relationships with customers and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose NeuroBo to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings.

        Although NeuroBo does not currently have any drugs on the market, once NeuroBo begins commercializing its product candidates, if approved, NeuroBo will be subject to additional healthcare statutory and regulatory requirements and enforcement by federal government and the states and foreign governments in the jurisdictions in which NeuroBo conducts its business. Healthcare providers, physicians and third-party payors will play a primary role in the recommendation and prescription of any product candidates for which NeuroBo obtains marketing approval. NeuroBo's future arrangements with third-party payors and customers may expose NeuroBo to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which NeuroBo markets, sells and distributes any products for which NeuroBo obtains marketing approval. Restrictions under applicable federal and state healthcare laws and regulations include the following:

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        Efforts to ensure that NeuroBo's business arrangements with third parties will comply with applicable healthcare laws and regulations will involve substantial costs. It is possible that governmental authorities will conclude that NeuroBo's business practices may not comply with current or future statutes, regulations or case law involving applicable fraud and abuse or other healthcare laws and regulations. If NeuroBo's operations are found to be in violation of any of these laws or any other governmental regulations that may apply to it, NeuroBo may be subject to significant civil, criminal and administrative penalties, damages, fines, imprisonment, exclusion of products from government funded healthcare programs, such as Medicare and Medicaid, and the curtailment or restructuring of NeuroBo's operations. If any of the physicians or other healthcare providers or entities with whom NeuroBo expects to do business is found to be not in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs.