forward-looking statements. Forward-looking statements are often characterized by the use of forward-looking terminology such as “may,” “will,” “expect,” “anticipate,” “estimate,” “continue,” “believe,” “predict,” “should,” “intend,” “project” or other similar words, but are not the only way these statements are identified. These forward-looking statements may include, but are not limited to, statements relating to our objectives, plans and strategies, statements that contain projections of results of operations or of financial condition, expected capital needs and expenses, statements relating to the research, development, completion and use of our products, and all statements (other than statements of historical facts) that address activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. Forward-looking statements are based on information we have when these statements are made or our management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to: • the adequacy of our financial and other resources, particularly in light of our history of recurring losses and the uncertainty regarding the adequacy of our liquidity to pursue our complete business objectives; • the benefits of and projections of our future financial performance as a result of our development of our product candidates; • our ability to enroll patients in our clinical trials and the possibility that patients would discontinue their participation in our clinical trials; • our ability to complete the development of our product candidates; • our ability to obtain the benefits associated with orphan drug designation, such as orphan drug exclusivity and, even if we do, that exclusivity may not prevent the U.S. Food and Drug Administration, or FDA, or other comparable foreign regulatory authorities from approving competing products; • the timing and results of clinical trials that we may conduct or that our competitors and others may conduct relating to our or their product candidates; • our dependence on the success of Beimei Pharmaceutical Co. Ltd, or Beimei, and Searchlight Pharma Inc., or Searchlight, and our other licensees in commercializing our approved products in China, Canada and in other licensed territories, respectively; • the ability of Sol-Gel and its licensees to obtain and maintain the regulatory approval of Twyneo and Epsolay in various territories; • our ability to obtain and maintain regulatory approvals for our product candidates in our target markets and the possibility of adverse regulatory or legal actions relating to our product candidates even if regulatory approval is obtained; • our ability to find suitable co-development, contract manufacturing and marketing partners to our products and product candidates; • our ability to commercialize and launch our product candidates; • our ability to obtain and maintain adequate protection of our intellectual property; • our ability to manufacture our product candidates in commercial quantities, at an adequate quality or at an acceptable cost; • acceptance of our products and product candidates by healthcare professionals and patients; • the possibility that we may face third-party claims of intellectual property infringement; • intense competition in our industry, with competitors having substantially greater financial, technological, research and development, regulatory and clinical, manufacturing, marketing and sales, distribution and personnel resources than we do; 2 • potential product liability claims; • potential adverse federal, state and local government regulation in the United States, Europe, China or Israel; • our failure to maintain compliance with the Nasdaq Listing Rules; • the impact of the current global macroeconomic climate on our ability to source supplies for our operations or our ability or capacity to manufacture, sell and support the use of SGT-610, Twyneo, Epsolay and our product candidates; and • loss or retirement of key executives and research scientists. You should review carefully the risks and uncertainties described under the heading “Risk Factors” in this annual report for a discussion of these and other risks that relate to our business and investing in our ordinary shares. The forward-looking statements contained in this annual report are expressly qualified in their entirety by this cautionary statement. Except as required by law, we undertake no obligation to update publicly any forward-looking statements after the date of this annual report to conform these statements to actual results or to changes in our expectations. Readers are urged to carefully review and consider the various disclosures made throughout this annual report on Form 20-F which are designed to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects. You should not put undue reliance on any forward-looking statements. Any forward-looking statements in this annual report on Form 20-F are made as of the date hereof, and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. 3 SUMMARY OF RISK FACTORS The following is a summary of some of the principal risks we face. The list below is not exhaustive, and investors should read this “Risk factors” section in full. • We are a dermatology company and have incurred significant losses since our inception. We expect to incur losses for the foreseeable future and may never achieve or maintain profitability. • We will need substantial additional funding to pursue our business objectives, and our current liquidity raises substantial doubt about our ability to continue as a going concern. If we are unable to raise capital when needed, we could be forced to curtail our planned operations and the pursuit of our growth strategy. If we are successful in raising additional capital, this may cause dilution to our shareholders, restrict our operations or require us to relinquish rights to our technologies or products. • All of our current product candidates are in development stage; therefore, we have not yet obtained regulatory approval for our product candidates in the United States or any other country. • We are dependent on the success of SGT-610, Twyneo, Epsolay and our product candidates for the treatment of topical dermatological conditions. • Our business is highly dependent on market perception of us and the safety and quality of Twyneo, Epsolay and our product candidates, if approved. Our business or products could be subject to negative publicity, which could have a material adverse effect on our business. • Although we have entered into exclusive license agreements with Beimei, Searchlight, and other licensees for China, Canadian and other territories commercial activities for Twyneo and Epsolay, we have a limited operating history in the dermatological prescription drug space which may makes it difficult to evaluate the success of our business to date and to assess our future viability. • Twyneo, Epsolay and our product candidates, even if they receive regulatory approval, may fail to achieve the broad degree of physician adoption and market acceptance necessary for commercial success. • Clinical drug development involves a lengthy and expensive process with an uncertain outcome, and results of earlier studies and clinical trials may not be predictive of future trial results, which could result in development delays or a failure to obtain marketing approval. • We may find it difficult to enroll patients in our clinical trials, and patients could discontinue their participation in our or our partners’ clinical trials, which could delay or prevent clinical trials for our product candidates. • Twyneo and Epsolay, and our product candidates, if approved, will face, significant competition and our failure to compete effectively may prevent us and our commercial partners from achieving significant market penetration and expansion. • We rely on commercialization partners to commercialize Twyneo and Epsolay in China, Canada and other jurisdictions around the world and may depend on other parties for commercialization of Twyneo and Epsolay in other jurisdictions outside of China and Canada, and the development and commercialization of our product candidates, if approved. We also rely on our partners and licensees to provide us with accurate reports in order for us to accurately report our royalty revenues and sales-based milestone payments. Any collaborative arrangements that we have (including our agreements with Beimei and Searchlight) or may establish in the future may not be successful or we may otherwise not realize the anticipated benefits from these collaborations. • We and our partners rely on third parties and consultants to assist us in conducting our clinical trials. If these third parties or consultants do not successfully carry out their contractual duties or meet expected deadlines, we may be unable to obtain regulatory approval for or commercialize our product candidates and our business could be substantially harmed. • The manufacture of pharmaceutical products is complex, and manufacturers often encounter difficulties in production. If we, our partners, or any of our third-party manufacturers encounter any difficulties, our ability to provide product candidates for clinical trials or our approved products to patients, and the development or commercialization of our product candidates could be delayed or stopped. • We depend on our intellectual property, and our future success is dependent on our ability to protect our intellectual property and not infringe on the rights of others. • If we are unable to protect the confidentiality of our trade secrets or know-how, such proprietary information may be used by others to compete against us. • If we fail to maintain compliance with Nasdaq’s continued listing requirements, our shares may be delisted from the Nasdaq Capital Market. • If we are not able to retain our key management, or attract and retain qualified scientific, technical and business personnel, our ability to implement our business plan may be adversely affected. 4