Item 8.01
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Other Information
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As a result of the outbreak of, and local, state and federal governmental responses to, the COVID-19
coronavirus pandemic, International Stem Cell Corporation (the Company) is furnishing this Current Report on Form 8-K to obtain an extension to file its Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 (the Quarterly Report), originally due on May 15, 2020. Specifically, the Company is relying on an order issued by the Securities and Exchange
Commission (the SEC) on March 25, 2020 , pursuant to Section 36 of the Securities Exchange Act of 1934, as amended (Release No. 34-88465)(the Order), regarding
potential exemptions granted to public companies with respect to specified filing requirements, subject to the conditions contained in the Order. The Order allows a registrant up to an additional 45 days after the original due date of certain
reports required to be filed with the SEC if the registrants ability to file such report timely is affected by circumstances related to COVID-19.
The Companys operations and business have experienced disruptions due to the unprecedented conditions surrounding the COVID-19 pandemic spreading throughout the United States and the world. These disruptions include, but are not limited to: office closures, limited access to required information and the unavailability or limited
availability of key Company personnel required to prepare the Companys financial statements and other disclosures for the quarter ended March 31, 2020 due to suggested, and mandated, social quarantining and work from home orders.
As such, the Company will be relying on the Order and will be making use of the 45-day grace period
provided by the Order to delay filing of its Quarterly Report. The Company plans to file its Quarterly Report by no later than June 29, 2020, 45 days after the original due date of its Quarterly Report.
The Company believes that the COVID-19 pandemic may affect its business in several ways. In the
upcoming Quarterly Report, the Company intends to update the Risk Factors to include the risks the Company can foresee associated with COVID-19. Currently, the Company expects that the principal Risk Factors
(to be included in the Quarterly Report) that will reflect the potential effects and risks of the COVID-19 pandemic include the following:
Our business is subject to risks arising from epidemic diseases, such as the recent global outbreak of the
COVID-19 coronavirus.
The recent outbreak of the coronavirus, COVID-19, which has been declared by the World Health Organization to be a pandemic has spread across the globe and is impacting worldwide economic activity. A pandemic, including
COVID-19 or other public health epidemic, poses the risk that we or our employees, contractors, customers, suppliers, third party shipping carriers, government and other partners may be prevented from or
limited in their ability to conduct business activities for an indefinite period of time, including due to the spread of the disease within these groups or due to shutdowns that may be requested or mandated by governmental authorities. While it is
not possible at this time to estimate the impact that COVID-19 could have on our business, the continued spread of COVID-19 and the measures taken by the governments of
states and countries affected could disrupt, among other things, the supply chain and the manufacture or shipment of our products. Our laboratory operations, including laboratory employees, may be subject to closure or shut down due to the spread of
the disease within these individuals, or as part of a larger scale government recommendation or mandate. Any disruption in our laboratory operations would have a material adverse effect on our business and would impede our ability to manufacture and
ship products to our customers in a timely manner, or at all. Additionally, the demand for our skincare products may significantly decline as COVID-19 continues to spread, including as a result of
prioritization of customer financial resources toward essential household items or government imposed quarantines that impede the ability of our customers to purchase our professional skincare product line through spas and medical offices that may
not be considered essential businesses and mandated to close for an indefinite amount of time. The occurrence of any of the foregoing events could have a material adverse effect on our business, financial condition and results of operations. The COVID-19 outbreak and mitigation measures have had and may continue to have an adverse impact on global economic conditions which could have an adverse effect on our business and financial condition, including
impairing our ability to raise capital when needed. The extent to which the COVID-19 outbreak impacts our results will depend on future developments that are highly uncertain and cannot be predicted, including
new information that may emerge concerning the severity of the virus and the actions to contain its impact.
We have limited clinical
testing and regulatory capabilities, and human clinical trials are subject to extensive regulatory requirements, very expensive, time-consuming and difficult to design and implement. Our products may fail to achieve necessary safety and efficacy
endpoints during clinical trials, which may limit our ability to generate revenues from therapeutic products.