Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following management's discussion and analysis of our financial condition and results of operations together with our unaudited condensed consolidated financial statements and the related notes and other information included elsewhere in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the Securities and Exchange Commission ("SEC"). Some of the information contained in this discussion and analysis or set forth elsewhere in this document, includes forward looking statements that involve risks, uncertainties, and assumptions. Our actual results could differ materially from those discussed in or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the section titled "Risk Factors" in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2024. Please also see the section titled "Forward Looking Statements."

The following discussion contains references to calendar year 2024 and the three and nine months ended September 30, 2025 and 2024, respectively, which represents the condensed consolidated financial results of Rani Therapeutics Holdings, Inc. (the "Company") and its subsidiary, Rani Therapeutics, LLC ("Rani LLC") for the year ended December 31, 2024 and the three and nine months ended September 30, 2025 and 2024, respectively. Unless we state otherwise or the context otherwise requires, the terms "we," "us," "our," and "Rani" and similar references refers to the Company and its consolidated subsidiary.

Overview

We are a clinical stage biotherapeutics company focusing on advancing technologies to enable the administration of biologics and drugs orally, to provide patients, physicians, and healthcare systems with a convenient alternative to painful injections. We are advancing a portfolio of oral therapeutics using our proprietary delivery technology and we are actively pursuing partnering the technology with third party biopharmaceutical companies for the oral delivery of their biologics and drugs.

Our technology comprises a drug-agnostic oral delivery platform, the RaniPill capsule, which is designed to deliver a wide variety of drug substances, including antibodies, proteins, peptides, and oligonucleotides. We have two configurations of the platform - the RaniPill GO and the RaniPill HC. The RaniPill GO is designed to deliver up to a 3 mg dose of drug in microtablet form with high bioavailability. We have completed three Phase 1 clinical trials using the RaniPill GO. We are also developing a high-capacity version of the RaniPill capsule known as the RaniPill HC, which is intended to enable delivery of drug payloads up to 200µL in liquid form with high bioavailability. We have tested preclinically the RaniPill HC with multiple therapeutics, including antibodies and a peptide. We intend to initiate clinical testing of the RaniPill HC by the end of 2025.

We believe the RaniPill capsule technology could enable us to deliver most biologics currently on the market with convenient, oral dosing.

We do not have any products approved for sale, and we have not yet generated any revenue from sales of a commercial product. Our ability to generate product revenue sufficient to achieve profitability, if ever, will depend on the successful development of the RaniPill capsule, which we expect will take a number of years. Given our stage of development, we have not yet established a commercial organization or distribution capabilities, and we have no experience as a company in marketing drugs or a drug-delivery platform. When, and if, any of our product candidates are approved for commercialization, we plan to develop a commercialization infrastructure or engage commercial sales organizations or distributors for those products in the United States, Europe, Asia, and potentially in certain other key markets. We may also rely on partnerships to provide commercialization infrastructure, including sales, marketing, and commercial distribution.

As is common with biotechnology companies, we rely on third-party suppliers for the supply of raw materials and active pharmaceutical ingredients ("APIs") and drug substances required for the production of our product candidates. In addition, we work with third parties to manufacture and develop biologics and drugs for inclusion in the RaniPill capsule. Design work, prototyping and pilot manufacturing are performed in house, and we have utilized third-party engineering firms to assist with the design of manufacturing lines that support our supply of the RaniPill capsule. Certain of our suppliers of components and materials are single source suppliers. We believe our vertically integrated manufacturing strategy will offer significant advantages, including rapid product iteration, control over our product quality and the ability to rapidly scale our manufacturing capacity. This capability also allows us to develop future generations of products while maintaining the confidentiality of our intellectual property. Our vertically integrated manufacturing strategy will result in material future capital outlays and fixed costs related to constructing and operating a manufacturing facility. We have invested and plan to continue to invest in automated manufacturing production lines for the RaniPill

capsule. Those assets deemed to have an alternative future use have been capitalized as property and equipment while those projects related to our assets determined to not have an alternative future use have been expensed as research and development costs.

Financial Update

In May 2025, we entered into a letter agreement (the "Letter Agreement") with an existing institutional investor (the "Equity Investor") pursuant to which the Equity Investor exercised for cash all outstanding Series B and Series C warrants held by such Equity Investor at a reduced exercise price of $0.65 per share, for net proceeds of $3.9 million, in consideration for the issuance of a new Series D common stock warrant (the "Series D Warrant") to purchase an aggregate of 13,160,172 shares of Class A common stock, $0.0001 par value per share (the "Class A Common Stock").

In July 2025, we entered into the July 2025 Securities Purchase Agreement with an institutional investor, relating to the issuance and sale of 4,354,000 shares of Class A common stock, par value $0.0001 per share, and pre-funded warrants to purchase 3,146,000 shares of Class A common stock (the "Offering"). The pre-funded warrants were exercisable immediately following the closing date of the Offering and have an unlimited term and an exercise price of $0.0001 per share. The Offering price was $0.40 per share of Class A common stock, and $0.3999 per pre-funded warrant for total gross proceeds of $3.0 million. After the closing the Offering, the institutional investor fully exercised all pre-funded warrants.

As of September 30, 2025, our cash, cash equivalents, and restricted cash equivalents totaled $4.6 million. In October 2025, we entered into a securities purchase agreement pursuant to which we sold in the Private Placement (i) 42,633,337 shares of our Class A Common Stock, (ii) warrants to purchase up to an aggregate of 125,000,004 shares of Class A Common Stock or pre-funded warrants (the "Common Warrants"), and (iii) pre-funded warrants to purchase up to an aggregate of 82,366,667 shares of Class A Common Stock (the "Pre-Funded Warrants") for the aggregate purchase price of approximately $60.3 million (including conversion of the Loan amount of $6.0 million described below).

The Common Warrants will become exercisable following the effective date of stockholder approval and have a term of five years following the initial exercise date. The Common Warrants have an exercise price of $0.48 per share. The Pre-Funded Warrants are exercisable immediately, have an unlimited term and an exercise price of $0.0001 per share. We also agreed to seek approval from our stockholders for the issuance of the shares issuable upon exercise of the Common Warrants within 75 days following the closing date of the Private Placement.

In October 2025, we entered into the LSA Amendment with the Lender, pursuant to which the Lender, among other things, converted $6.0 million of outstanding Loans into 12,500,000 shares of our Class A Common Stock (or Pre-Funded Warrants in lieu thereof) and Common Warrants to purchase up to 12,500,000 shares of Class A Common Stock (or Pre-Funded Warrants in lieu thereof), on the same terms as other investors in the Private Placement.

We expect to continue to incur losses for the foreseeable future, and our net losses may fluctuate significantly from period to period, depending on the timing of and expenditures on our planned research and development activities. We will need to raise substantial additional funds in the future in order to complete the development of the RaniPill platform, to complete the clinical development of our product candidates and seek regulatory approval thereof, to expand our manufacturing capabilities, to further develop the RaniPill HC device and to commercialize any of our product candidates. We may seek to raise capital through equity offerings or debt financings, collaboration agreements, strategic transactions or other arrangements with other companies, or through other sources of financing. The sale of additional equity would result in additional dilution to our stockholders. The incurrence of additional debt financing would result in debt service obligations and the instruments governing such debt could provide for operating and financing covenants that would restrict our operations. We may not be able to raise additional financing on terms acceptable to us or at all. If we are unable to raise additional capital when desired, our business, operating results, and financial condition could be adversely affected.

Preclinical Update

In May 2025, we announced that we have entered a Research Collaboration in August 2024 for two molecules with undisclosed targets provided by Chugai Pharmaceutical Co., Ltd. The full analysis confirms the RaniPill® delivery demonstrated comparable bioavailability to the subcutaneous route of delivery for both molecules studied.

In March 2025, we announced preclinical data demonstrating bioequivalence of RT-114, a bispecific GLP-1/GLP-2 receptor agonist (PG-102) delivered orally via the RaniPill capsule ("RT-114"), to subcutaneously administered PG-102. RT-114 yielded a relative bioavailability of 111% compared to PG-102 delivered subcutaneously with comparable pharmacokinetic profiles and weight loss. RT-114 was well tolerated and was excreted without sequelae in all subjects. Average peak weight loss was the same in both groups with greater variability with subcutaneous dosing (6.7% ± 0.5% for RT-114 and 6.7% ± 2.2% for subcutaneous PG-102). In July 2025, the same set of data was presented at the ENDO conference in San Francisco, California. Collectively, these compelling nonclinical results provide a robust rationale for initiating clinical development of RT-114 as a first-in-class oral anti-obesity therapy. We plan to initiate a Phase 1 trial for RT-114 by the end of 2025. The upcoming trial will evaluate safety, tolerability, and pharmacokinetics, laying the groundwork for future development phases.

In February 2025, we announced preclinical data demonstrating successful oral delivery of the glucagon-like peptide-1 receptor ("GLP-1") agonist semaglutide via the RaniPill HC ("RT-116"). In the study, RT-116 demonstrated comparable bioavailability, pharmacokinetics and weight loss to subcutaneous ("SC") administration of semaglutide. Further, RT-116 was well tolerated with no serious adverse events.

Collaboration and License Agreement

In October 2025, we entered into the Collaboration and License Agreement with Chugai to develop, manufacture, seek regulatory approvals for and, if approved, commercialize the Product combining Chugai's Compound, which is in development for hemophilia, and the Device for use in humans. Under the Collaboration and License Agreement, we are entitled to receive a $10.0 million upfront payment within 30 days of Chugai receiving an invoice for the upfront payment after closing. We would be eligible to receive up to $18.0 million in technology transfer milestones, up to $57.0 million in development milestones, up to $100.0 million in a series of sales-based milestones, contingent upon approval and the commercial success of the product, and single digit royalties on net sales upon approval and successful commercialization of the Product.

In accordance with a development plan, the parties will share responsibility for the development of the Product worldwide, with Chugai leading and having sole responsibility for clinical, regulatory, and commercial activities. The parties will allocate preclinical, Chemistry Manufacturing and Controls, and manufacturing and supply activities between each other, with Chugai being primarily responsible for development of the Compound and us being primarily responsible for development of the Device and Product.

Under the Collaboration and License Agreement, the Company granted Chugai an exclusive, worldwide right and license to certain intellectual property owned by us to research, develop, register, manufacture, use, sell, offer to sell, import, export, commercialize, and market the Product. Chugai granted us a non-exclusive, worldwide right and license to certain intellectual property owned by Chugai to manufacture and supply the Device and Product to Chugai and to perform its activities under the Collaboration and License Agreement. Both parties have the right to sublicense subject to certain conditions.

In addition, Chugai has a one-time limited option to replace the Compound with a different compound subject to certain terms and conditions, a time-limited right of first refusal with respect to a select group of additional targets, and a time-limited option to extend its rights to up to five of the additional drug targets under similar deal terms as the Collaboration and License Agreement.

Relationship with InCube Labs, LLC

See Note 7 to the condensed consolidated financial statements contained in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

Results of Operations

The results of operations presented below should be reviewed in conjunction with the condensed consolidated financial statements and notes included elsewhere in this Quarterly Report on Form 10-Q. For information with respect to recent accounting pronouncements that are of significance or potential significance to us, see "Note 2. Summary of Significant Accounting Policies" in the "Notes to the Unaudited Condensed Consolidated Financial Statements" contained in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Comparison of the three months ended September 30, 2025 and 2024

The following table summarizes our results of operations (in thousands):

Research and Development Expenses

The following table reflects our research and development costs by nature of expense (in thousands):

The decrease of $3.0 million in research and development expenses in the three months ended September 30, 2025, as compared to the same period in 2024, was primarily attributed a $2.4 million reduction in compensation costs resulting from lower headcount, a $0.4 million decrease in expenses related to facilities, materials and supplies, and a $0.2 million decrease in third-party services. These reductions reflect cost containment efforts, including the temporary pause of certain R&D programs. We anticipate the R&D expenses to increase in future periods as we resume these programs and continue to invest in product development.

General and Administrative Expenses

The decrease of $1.6 million in general and administrative expenses in the three months ended September 30, 2025, as compared to the same period in 2024, was primarily attributed to lower compensation costs of $1.3 million and a reduction of $0.3 million in third-party services.

Other Income (Expense), Net

The decrease of $0.3 million in other income (expense), net, in the three months ended September 30, 2025, as compared to the same period in 2024, was primarily attributed to a decrease in interest income of $0.3 million from our investments, offset by a decrease in interest expenses of $0.6 million.

Comparison of the nine months ended September 30, 2025 and 2024

The following table summarizes our results of operations (in thousands):

* Not meaningful

Contract Revenue

Contract revenue of $0.2 million for the nine months ended September 30, 2025, was attributable to evaluation services performed for the evaluation agreement with Chugai. There was no contract revenue for the same period in 2024.

Research and Development Expenses

The following table reflects our research and development costs by nature of expense (in thousands):

The decrease of $4.6 million in research and development expenses in the nine months ended September 30, 2025, as compared to the same period in 2024, was primarily attributed to a $4.1 million reduction in compensation costs resulting from lower headcount, a $0.4 million of reduced spending on material and supplies, and a $0.1 million decrease in third-party services.

General and Administrative Expenses

The decrease of $3.8 million in general and administrative expenses in the nine months ended September 30, 2025, as compared to the same period in 2024, was primarily attributed to lower compensation costs of $2.3 million, $1.4 million reduction in third-party services, and $0.1 million reduction in other expenses.

Other Income (Expense), Net

The decrease of $0.4 million in other income (expense), net, in the nine months ended September 30, 2025, as compared to the same period in 2024, was primarily attributed to a decrease in interest income of $1.0 million from our investments, offset by a decrease in interest expenses of $1.4 million.

Liquidity and Capital Resources

Overview

We have incurred recurring losses and negative cash flows from operations since inception, including net loss of $31.9 million for nine months ended September 30, 2025. As of September 30, 2025, we had an accumulated deficit of $122.3 million and for nine months ended September 30, 2025, had negative cash flows from operations of $19.0 million. As of September 30, 2025, our cash, cash equivalents, and restricted cash equivalents totaled $4.6 million. We expect to continue to incur losses for the foreseeable future, and our net losses may fluctuate significantly from period to period, depending on the timing of and expenditures on our planned research and development activities.

As disclosed in more detail below, we have entered into various financing agreements and a license and collaboration agreement in October 2025. We believe that the proceeds from the closing of the Private Placement, the upfront payment from the Collaboration and License Agreement with Chugai, the proceeds received from Series D Warrant exercises, and the impact of the Debt Conversion provide sufficient capital resources to meet our operating obligations for at least twelve months from the date the condensed consolidated financial statements are issued. Our management believes that the going concern doubt in our 2024 10-K and previous quarterly reports on Form 10-Q has been alleviated.

Financial Update

In October 2025, we entered into a securities purchase agreement pursuant to which we sold in the Private Placement (i) 42,633,337 shares of our Class A Common Stock, (ii) warrants to purchase up to an aggregate of 125,000,004 shares of Class A Common Stock or pre-funded warrants (the "Common Warrants") and (iii) pre-funded warrants to purchase up to an aggregate of 82,366,667 shares of Class A Common Stock (the "Pre-Funded Warrants"), for the aggregate purchase price of approximately $60.3 million (including conversion of the Loan amount of $6.0 million described below).

The Common Warrants will become exercisable following the effective date of stockholder approval and have a term of five years following the initial exercise date. The Common Warrants have an exercise price of $0.48 per share. The Pre-Funded Warrants are exercisable immediately, have an unlimited term and an exercise price of $0.0001 per share. We also agreed to seek approval from our stockholders for the issuance of the shares issuable upon exercise of the Common Warrants within 75 days following the closing date of the Private Placement

In October 2025, we entered into the LSA Amendment with the Lender, pursuant to which the Lender, among other things, converted $6.0 million of outstanding Loans into 12,500,000 shares of our Class A Common Stock (or Pre-Funded Warrants in lieu thereof) and Common Warrants to purchase up to 12,500,000 shares of Class A Common Stock (or Pre-Funded Warrants in lieu thereof), on the same terms as other investors in the Private Placement.

In October 2025, we entered into the Collaboration and License Agreement with Chugai to develop, manufacture, seek regulatory approvals for and, if approved, commercialize the Product combining Chugai's Compound, which is in development for hemophilia, and the Device for use in humans. Under the Collaboration and License Agreement, the Company will receive a $10.0 million upfront payment within 30 days of Chugai receiving an invoice for the upfront payment after closing. We are eligible to receive up to $18.0 million in technology transfer milestones, up to $57.0 million in development milestones, up to $100.0 million in a series of sales-based milestones, contingent upon approval and the commercial success of the product, and single digit royalties on net sales, contingent on approval and commercialization of the Product.

In July 2025, we entered into the July Securities Purchase Agreement with an institutional investor, relating to the issuance and sale of 4,354,000 shares of Class A common stock, par value $0.0001 per share, and pre-funded warrants to purchase 3,146,000 shares of Class A common stock. The pre-funded warrants are exercisable immediately following the closing date of the Offering and have an unlimited term and an exercise price of $0.0001 per share. The Offering price was $0.40 per share of Class A common stock and $0.3999 per pre-funded warrant for total gross proceeds of $3.0 million. After closing of the Offering, the institutional investor fully exercised all pre-funded warrants.

In May 2025, we entered into the Letter Agreement with an existing institutional investor (the "Equity Investor") pursuant to which the Investor exercised for cash all outstanding Series B and Series C warrants at a reduced exercise price of $0.65 per share in consideration for the Company's issuance of a the Series D Warrant to purchase an aggregate of 13,160,172 shares of Class A common stock, $0.0001 par value per share with the exercise price of $0.65 per share. In October 2025, the Equity Investor exercised 6,967,150 shares of Series D Warrants, resulting in 6,193,022 shares of Series D Warrants remained outstanding. The Company received cash proceeds of $4.5 million as a result of the exercise.

In August 2022, we entered into the Loan Agreement with the Lender. The Loan Agreement provides for term loans (the "Loans") in an aggregate principal amount up to $45.0 million. A Loan of $30.0 million was committed at closing, with $15.0 million funded immediately and $15.0 million available to be drawn between October 1, 2022 and December 31, 2022, which was drawn in December 2022. The remaining $15.0 million of Loans was uncommitted and subject to certain conditions and is no longer available under the Loan Agreement. The Loan Agreement also contains various covenants and restrictive provisions. There have been no material adverse events in connection with the Loan Agreement. The Loan principal is repayable in equal monthly installments which began in September 2024. As of September 30, 2025, we were in compliance with all financial covenants under the Loan Agreement.

Tax Receivable Agreement

See Note 12 to the condensed consolidated financial statements contained in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

Future Funding Requirements

We will need to raise substantial additional funds in the future in order to complete the development of the RaniPill platform, to complete the clinical development of our product candidates and seek regulatory approval thereof, to expand our manufacturing capabilities, to further develop the RaniPill technology and to commercialize any of our product candidates.

To date, we have not generated any commercial product revenue. We do not expect to generate any commercial product revenue unless and until we obtain regulatory approval and commercialize any of our commercial product candidates, and we do not know when, or if at all, that will occur. We will continue to require additional capital to develop our product candidates and fund operations for the foreseeable future. Our primary uses of cash are to fund our operations, which consist primarily of research and development expenses related to our programs, manufacturing automation and scaleup, and general and administrative expenses. We expect our expenses to continue to increase in connection with our ongoing activities as we continue to advance the RaniPill technology and our product candidates.

We may seek to raise capital through equity offerings or debt financings, which may include collaboration agreements, or other arrangements with other companies, or through other sources of financing. Adequate additional funding may not be available to us on acceptable terms or at all. Our failure to raise capital as and when needed could have a negative impact on our consolidated financial condition and our ability to pursue our business strategies. We anticipate that we will need to raise substantial additional capital, the requirements of which will depend on many factors, including:

If we raise additional capital through debt financing, we may be subject to covenants that restrict our operations including limitations on our ability to incur liens or additional debt, pay dividends, make certain investments, and engage in certain merger, consolidation, or asset sale transactions. Any debt financing or additional equity that we raise may contain terms that are not favorable to us. If we raise funds through collaborations, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds when needed, we may be required to delay, reduce, or terminate some or all of our development programs and clinical trials or delay investments in our manufacturing scale-up and automation. In addition, our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to and volatility in the credit and financial markets.

The following table summarizes our cash, cash equivalents and marketable securities:

As of September 30, 2025, we had cash and cash equivalents and marketable securities of $4.1 million, compared to $27.6 million as of December 31, 2024.

Cash Flows

The following table summarizes our cash flows for the periods presented (in thousands):

Operating Activities

Net cash used in operating activities for the nine months ended September 30, 2025 was $19.0 million, which was primarily attributable to a net loss of $31.9 million and net accretion and amortization of investments in marketable securities of $0.2 million, partially offset by stock-based compensation expense of $9.6 million, depreciation and amortization expense of $0.7 million and $0.2 million in warrant issuance costs and expenses. Additionally, there was an increase in accounts payable of $1.1 million, accrued expenses and other current liabilities of $0.6 million and a decrease in contract asset of $0.4 million and prepaid expenses and other current assets of $0.9 million for the nine months ended September 30, 2025.

Net cash used in operating activities for the nine months ended September 30, 2024 was $26.8 million, which was primarily attributable to a net loss of $40.9 million and net accretion and amortization of investments in marketable securities of $0.9 million, partially offset by stock-based compensation expense of $12.0 million and depreciation and amortization expense of $0.8 million. Additionally, there was an increase in accounts payable of $0.9 million, an increase in deferred revenue of $0.6 million and an increase of $0.3 million in prepaid expenses and other current assets for the nine months ended September 30, 2024.

Investing Activities

For the nine months ended September 30, 2025, net cash provided by investing activities was $23.9 million, which primarily consisted of $26.8 million in proceeds from maturities of marketable securities partially offset by $2.7 million in purchases of marketable securities and $0.1 million in purchases of property and equipment.

For the nine months ended September 30, 2024, net cash provided by investing activities was $17.3 million, which primarily consisted of $57.3 million in proceeds from maturities of marketable securities partially offset by $39.7 million in purchases of marketable securities and $0.2 million in purchases of property and equipment.

Financing Activities

For the nine months ended September 30, 2025, net cash used in financing activities was $4.6 million, which primarily consisted of repayment of debt of $11.3 million offset by the exercise of warrants of $3.9 million, and the issuance of common stock and pre-funded warrants of $2.8 million.

For the nine months ended September 30, 2024, net cash provided by financing activities was $8.0 million, which primarily consisted of net proceeds of $8.9 million from the July Offering and $0.2 million from the issuance of common stock under the employee stock purchase plan, partially offset by $1.3 million repayment of debt.

Contractual Obligations and Other Commitments

In October 2025, we entered into the LSA Amendment with the Lender, pursuant to which the Lender, among other things, converted $6.0 million of outstanding Loans into 12,500,000 shares of our Class A Common Stock (or Pre-Funded Warrants in lieu thereof) and Common Warrants to purchase up to 12,500,000 shares of Class A Common Stock (or Pre-Funded Warrants in lieu thereof), on the same terms as the purchasers in the Private Placement (see Note 16 to our unaudited condensed consolidated financial statements included elsewhere in Part I, Item 1 of this Quarterly Report).

In October 2025, we entered into the Collaboration and License Agreement with Chugai to develop, manufacture, seek regulatory approvals for and, if approved, commercialize the Product combining Chugai's Compound, which is in development for hemophilia, and the Device for use in humans. Under the Collaboration and License Agreement, we are entitled to receive $10.0 million upfront within 30 days of Chugai receiving an invoice for the upfront payment after closing. We are eligible to receive up to $18.0 million in technology transfer milestones, up to $57.0 million in development milestones, up to $100.0 million in a series of sales-based milestones, contingent upon approval and the commercial success of the product, and single digit royalties on net sales, contingent on approval and commercialization of the Product (see Note 16 to our unaudited condensed consolidated financial statements included elsewhere in Part I, Item 1 of this Quarterly Report).

Other than those described above, management believes that there have been no material changes to our contractual obligations and other commitments compared to those disclosed in our Annual Report on Form 10-K.

Critical Accounting Estimates

We prepare our condensed consolidated financial statements in accordance with U.S. generally accepted accounting principles, which require our management to make estimates that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. We base our estimates on our own historical experience and other assumptions that we believe are reasonable after taking account of our circumstances and expectations for the future based on available information. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected.

We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. There are items within our condensed consolidated financial statements that require estimation but are not deemed critical, as defined above.

Recently Adopted Accounting Standards

None.

Other Information

JOBS Act Accounting Election

We are an "emerging growth company" within the meaning of the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). The JOBS Act permits an emerging growth company like us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We are electing to use this extended transition period and we will therefore comply with new or revised accounting standards on the earlier of (i) when they apply to private companies; or (ii) when we lose our emerging growth company status. As a result, our financial statements may not be comparable with companies that comply with public company effective dates for accounting standards. We also rely on other exemptions provided by the JOBS Act, including not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act unless we cease to be an emerging growth company.

We will remain an emerging growth company until the earliest of (1) December 31, 2026 (the last day of the fiscal year following the fifth anniversary of the closing of our IPO), (2) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion, (3) the last day of the fiscal year in which we are deemed to be a "large accelerated filer" as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which would occur if the market value of our Class A common stock held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year or (4) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.