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

Management's Discussion and Analysis ofFinancial Condition and Results of Operations.

Operating results for the three and six months ended June 30, 2025, are not necessarily indicative of results that may occur in future interim periods or future fiscal years. Some of the statements in this "Management's Discussion and Analysis of Financial Condition and Results of Operations" are forward-looking statements. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to our management and involve significant elements of subjective judgment and analysis. Words such as "expects," "will," "anticipates," "targets," "intends," "plans," "believes," "seeks," "estimates," "potential," "should," "could," variations of such words, and similar expressions are intended to identify forward-looking statements. Our actual results and the timing of events may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such a difference include those discussed under the heading "Risk Factors" in Item 1A of Part I of our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 12, 2025, and in Part II, Item 1A of this Quarterly Report on Form 10-Q. These and many other factors could affect our future financial and operating results. We undertake no obligation to update any forward-looking statement to reflect events after the date of this Quarterly Report on Form 10-Q. In addition, statements that "we believe" and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Quarterly Report on Form 10-Q. While we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into or review of, all relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely on these statements.

Overview

SCYNEXIS, Inc. is pioneering innovative medicines to overcome and prevent difficult-to-treat and drug-resistant infections. We are developing our proprietary antifungal platform "fungerps", a novel class of antifungal agents called triterpenoids, that are structurally distinct glucan synthase inhibitors and have generally shown in vitroand in vivo activity against a broad range of human fungal pathogens such as Candidaand Aspergillusgenera, including multidrug-resistant strains, as well as Pneumocystis, Coccidioides, Histoplasma and Blastomycesgenera and most common mucorales species.

Ibrexafungerp is the first representative of this novel class of antifungals and was approved by the U.S. Food and Drug Administration (FDA) as BREXAFEMME (ibrexafungerp tablets) for treatment of patients with vulvovaginal candidiasis and for the reduction in the incidence of recurrent vulvovaginal candidiasis in 2021 and 2022, respectively. Oral ibrexafungerp is also under development for other systemic fungal diseases.

A second generation fungerp SCY-247 is currently being evaluated in clinical trials with additional compounds from our proprietary fungerp platform, targeted to address significant unmet needs, in earlier stages of development.

Oral ibrexafungerp is also under development for other systemic fungal diseases.

MARIO Study and Clinical Hold Update

As previously disclosed, we and GlaxoSmithKline Intellectual Property (No. 3) Limited (GSK) entered into an exclusive license agreement dated March 30, 2023, which was subsequently amended by a binding memorandum of understanding dated December 26, 2023 (collectively, the GSK License Agreement).

As previously disclosed, the Phase 3 MARIO study of ibrexafungerp for the treatment of invasive candidiasis was placed on clinical hold in September 2023 following identification of a potential cross-contamination at the facility of the drug substance manufacturer in light of draft FDA guidance recommending that certain drugs be manufactured in separate facilities. One of these drugs, a non-antibiotic beta lactam drug called ezetimibe, was being manufactured at the same facility as ibrexafungerp. We have since moved the manufacture of the clinical supplies of ibrexafungerp to enable the continuation of the MARIO study to a new facility.

On April 24, 2025, the FDA notified us that the clinical hold on ibrexafungerp had been lifted and concluded that the Phase 3 MARIO study could resume. Subsequently, on April 28, 2025, GSK notified us of their intention to immediately terminate the study based on its purported rights under the GSK License Agreement to unilaterally terminate the MARIO study. GSK claimed that, as a result, it would have no obligations to pay any further development milestones related to the MARIO study, including $30.0 million tied to the resumption and continuation of the study. We do not believe that GSK currently has the right to unilaterally terminate the MARIO study under the GSK License Agreement.

Pursuant to the GSK License Agreement, we are responsible for conducting the MARIO study. The GSK License Agreement provides that certain material changes to the study, including termination, require mutual written agreement of both parties. We have not provided such agreement; in fact, GSK did not give any indication of an intent to terminate the MARIO study until the day it sent its notice. The GSK License Agreement only provides GSK with a unilateral termination right in the event that dosage of the first new patient in MARIO had not occurred by a particular date. The date was set as April 26, 2025, subject to automatic extension of up to two months if the implementation of additional in process control method validation

was included in the amended IND or required by GSK, resulting in additional time in the manufacturing process. GSK has taken the position that the initial deadline was not extended. On the contrary, our position is that the triggering event for extension of the timeline for the maximum of two months clearly occurred since GSK required, and the amended IND includes, new in process control method validation that resulted in extension of the manufacturing process. Therefore, contrary to GSK's notice, we believe that GSK does not have the unilateral right to terminate the MARIO study and we have thus informed GSK.

We are seeking to resolve this disagreement with GSK. Meanwhile, we reinitiated the MARIO study and patient dosing resumed in the Phase 3 MARIO study in May 2025, triggering us to bill a $10.0 million development milestone to GSK in the three months ended June 30, 2025. We are seeking to collect our development milestones from GSK and ultimately complete the study. While at this time it is too early to say how this disagreement may be resolved, GSK has reiterated its commitment to continued collaboration regarding other aspects of the GSK License Agreement including with respect to the commercialization of BREXAFEMME for the VVC and RVVC indications.

The September 2023 identification of a potential cross-contamination at the facility of the drug substance manufacturer also resulted in a recall of all commercial supplies of BREXAFEMME. The manufacturing of new commercial supplies of BREXAFEMME and eventual reintroduction to the market is carried out by GSK.

We remain committed to developing novel antifungal solutions to the rising threat of deadly fungal infections including invasive candidiasis for which there are limited treatment options and significant concerns for emergence of resistances, as highlighted by the WHO in their call to industry and other parties for research, development and public health action in this area of unmet need.

SCY-247 Development Update

We continue to progress the development activities for SCY-247 and recently completed the single and multiple ascending dose portions of our ongoing Phase 1 study of oral SCY-247 in 88 healthy subjects. The primary endpoint is safety and tolerability, and the secondary endpoint is pharmacokinetics. We expect to release the single ascending and multiple ascending dose data in the third quarter of 2025.

Nasdaq Minimum Bid Price Notification

On June 20, 2025, we received a letter from the Listing Qualifications Department staff (the Staff) of the Nasdaq notifying us that, for the last 30 consecutive business days, the closing bid price for our common stock was below the $1.00 per share minimum required for continued listing on the Nasdaq Global Market as set forth in Nasdaq Listing Rule 5450(a)(1). The letter from Nasdaq has no immediate effect on the listing of our common stock on the Nasdaq Global Market.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we have 180 calendar days from June 20, 2025, or until December 17, 2025 (the Compliance Date), to regain compliance with the minimum bid price rule. Thereafter, if such a company does not regain compliance with the bid price requirement, a second 180-day compliance period may be available. If, at any time before the Compliance Date, the closing bid price of our common stock is at least $1.00 per share for a minimum of 10 consecutive business days, the Staff will provide us written confirmation of compliance with the minimum bid price rule and the matter will be closed.

Class Action Lawsuit

On November 7, 2023, a securities class action was filed by Brian Feldman against us and certain of our executives in the United States District Court, District of New Jersey, alleging that, during the period from March 31, 2023 to September 22, 2023, we made materially false and/or misleading statements, as well as failed to disclose material adverse facts about our business, operations, and prospects, alleging specifically that we failed to disclose to investors: (1) that the equipment used to manufacture ibrexafungerp was also used to manufacture a non-antibacterial beta-lactam drug substance, presenting a risk of cross-contamination; (2) that we did not have effective internal controls and procedures, as well as adequate internal oversight policies to ensure that its vendor complied with current Good Manufacturing Practices (cGMP); (3) that, due to the substantial risk of cross-contamination, we were reasonably likely to recall its ibrexafungerp tablets and halt its clinical studies; and (4) as a result of the foregoing, our statements about our business, operations, and prospects were materially misleading and/or lacked a reasonable basis. The complaint seeks unspecified damages, interest, fees and costs on behalf of all persons and entities who purchased and/or acquired shares of our common stock between March 31, 2023 to September 22, 2023. The court granted our motion to dismiss with leave to amend on July 30, 2025.

On May 1, 2024, and again on June 4, 2024, purported shareholder derivative complaints were filed in the United States District Court, District of New Jersey. The complaints name our directors and certain of our officers and assert state and federal claims based on the same alleged misstatements as the securities class action complaint. These cases seek unspecified damages, disgorgement, unspecified equitable relief, interest, fees and costs. The complaints have been consolidated and are currently stayed. We disagree with the allegations and we intend to defend these litigations vigorously.

Liquidity

We have operated as a public entity since we completed our initial public offering in May 2014, which we refer to as our IPO. We also completed a follow-on public offering of our common stock in April 2015 and public offerings of our common stock and warrants in June 2016, March 2018, December 2019, December 2020, and April 2022. Our principal source of liquidity is cash, cash equivalents, and investments which totaled $46.5 million as of June 30, 2025.

As of June 30, 2025, our accumulated deficit was $388.8 million. We expect we will continue to incur significant research and development expense as we continue to execute our research and drug development strategy. Consistent with our operating plan, we also expect that we will continue to incur significant selling, general and administrative expenses to support our public reporting company operations and ongoing operations. As a result, we will need additional capital to fund our operations, which we may obtain through one or more of equity offerings, debt financings, other non-dilutive third-party funding (e.g., grants), strategic alliances and licensing or collaboration arrangements. We may offer shares of our common stock pursuant to our effective shelf registration statements or our "at-the-market" offering program pursuant to the Controlled Equity OfferingSMSales Agreement with Cantor Fitzgerald & Co.

Collaborations and Licensing Agreements

We are party to a number of licensing and collaboration agreements with partners in human health, including: (1) GSK, a pharmaceutical company, which we exclusively (even as to us and our affiliates) provide a, royalty-bearing, sublicensable license for the development, manufacture, and commercialization of ibrexafungerp, including the approved product BREXAFEMME, for all indications, in the GSK Territory; (2) Merck, a pharmaceutical company, under which we exclusively licensed the rights to ibrexafungerp in the field of human health, and agreed to pay Merck milestones upon the occurrence of specified events as well as tiered royalties based on worldwide sales of ibrexafungerp when and if it is approved (in 2014, Merck assigned to us the patents related to ibrexafungerp that it had exclusively licensed to us and, as contemplated by the agreement, we will continue to pay milestones and royalties); (3) Hansoh, a pharmaceutical company, which we have exclusively provided a license to research, develop and commercialize ibrexafungerp in the Greater China region, including mainland China, Hong Kong, Macau, and Taiwan; Hansoh recently received Chinese approval for ibrexafungerp in VVC and we will receive a milestone upon commercialization as well as royalties of approximately 10%; (4) R-Pharm, CJSC, or "R-Pharm," a leading supplier of hospital drugs in Russia, granting R-Pharm exclusive rights in the field of human health to develop and commercialize ibrexafungerp in Russia and several non-core markets, under which we are entitled to receive potential milestones and royalties and reimbursement for certain development costs incurred by us (this agreement is not material to our unaudited condensed consolidated balance sheets, statements of operations, or statements of cash flows); (5) Waterstone, an international pharmaceutical business, granting Waterstone exclusive worldwide rights to development and commercialization of SCY-635 for the treatment of viral diseases in humans, under which we are entitled to receive potential milestones and royalties; and (6) Cypralis Limited, or "Cypralis," a life sciences company, transferring to Cypralis certain cyclophilin inhibitor assets of ours, under which we are eligible to receive milestone payments upon the successful progression of certain Cypralis clinical candidates into later stage clinical studies and royalties payable upon product commercialization.

Components of Operating Results

Revenue

Revenue consists of license agreement revenue associated with GSK.

Research and Development Expense

Research and development expense consists of expenses incurred while performing research and development activities to discover, develop, or improve potential product candidates we seek to develop. This includes conducting preclinical studies and clinical trials, manufacturing and other development efforts, and activities related to regulatory filings for product candidates. We recognize research and development expenses as they are incurred. Our research and development expense primarily consists of:

Ibrexafungerp and SCY-247 were the only key research and development projects during the periods presented. We expect to continue to incur significant research and development expense for the foreseeable future as we continue our effort to develop ibrexafungerp and SCY-247, and to potentially develop our other product candidates, subject to the availability of additional funding.

The successful development of product candidates is highly uncertain. At this time, we cannot reasonably estimate the nature, timing or costs required to complete the remaining development of any product candidates. This is due to the numerous risks and uncertainties associated with the development of product candidates.

Selling, General and Administrative Expense

Selling, general and administrative expense consists primarily of salaries and personnel-related costs, including employee benefits and any stock-based compensation. This includes personnel in executive, finance, human resources, business development, medical affairs, marketing and commercial, and administrative support functions. Other expenses include facility-related costs not otherwise allocated to research and development expense, professional fees for accounting, auditing, tax and legal services, consulting costs for general and administrative purposes, patent application and legal fees, information systems and marketing efforts.

Other Expense (Income)

All of our other expense (income) recognized in the three and six months ended June 30, 2025 and 2024, consists of amortization of debt issuance costs and discount, interest income, interest expense, the warrant liability fair value adjustment, and the derivative liability fair value adjustment.

Income Tax Expense

For the six months ended June 30, 2024, our income tax expense recognized consists primarily of an expense for U.S. federal income tax.

Results of Operations for the Three Months Ended June 30, 2025 and 2024

The following table summarizes our results of operations for the three months ended June 30, 2025 and 2024, together with the changes in those items in dollars and percentage (dollars in thousands):

Revenue. For the three months ended June 30, 2025 and, 2024, revenue consists of $1.4 million and $0.7 million, respectively, in license agreement revenue associated with the GSK License Agreement.

Research and Development.For the three months ended June 30, 2025, research and development expenses increased to $7.1 million compared to $6.8 million for the three months ended June 30, 2024. The increase of $0.3 million, or 5%, for the three months ended June 30, 2025, was primarily driven by an increase of $0.3 million in chemistry, manufacturing, and controls (CMC) expense, an increase of $0.4 million in preclinical expense, and an increase of $0.2 million in clinical expense, offset in part by a decrease of $0.2 million in salary expense and a net decrease of $0.4 million in other research and development expense.

The $0.3 million increase in CMC expense is primarily associated with a $0.2 million increase in expense associated with the manufacturing of drug product for SCY-247 and ibrexafungerp. The $0.4 million increase in preclinical expense was primarily associated with certain preclinical costs associated with the continued development of SCY-247. The $0.2 million increase in clinical expense was primarily due to a $1.5 million increase in expense for the Phase 1 study for SCY-247, offset in part by a $0.7 million decrease in clinical expense for the FURI and CARES studies which were completed in the prior comparable period, a $0.1 million decrease in clinical expense associated with the Phase 3 MARIO study, a $0.1 million decrease in clinical expense for the VANQUISH study, and a net decrease of $0.4 million in other clinical expense.

Selling, General & Administrative. For the three months ended June 30, 2025, selling, general and administrative expenses increased to $3.8 million compared to $3.2 million for the three months ended June 30, 2024. The increase of $0.6 million, or 20%, for the three months ended June 30, 2025, was primarily driven by an increase of $0.4 million in professional fees.

Amortization of Debt Issuance Costs and Discount. For the three months ended June 30, 2025 and 2024, we recognized zero and $0.4 million in amortization of debt issuance costs and discount, respectively. The debt issuance costs and discount for our March 2019 convertible notes, which were fully paid at maturity in March 2025, primarily consisted of an allocated portion of advisory fees and other issuance costs and the initial fair value of the derivative liability.

Interest Income. For the three months ended June 30, 2025 and 2024, we recognized $0.5 million and $1.1 million, respectively, in interest income on our money market funds and investments.

Interest Expense. For the three months ended June 30, 2025 and 2024, we recognized zero and $0.2 million in interest expense on our March 2019 convertible notes which were fully paid at maturity in March 2025.

Warrant Liabilities Fair Value Adjustment. For the three months ended June 30, 2025 and 2024, we recognized a gain of $2.2 million and a loss of $5.8 million, respectively, in the fair value adjustment related to the warrant liabilities primarily due to the decrease and increase in our stock price during the respective periods.

Derivative Liability Fair Value Adjustment. For the three months ended June 30, 2024, we recognized a gain of $28,000 in the fair value adjustment related to the derivative liability primarily due to the decrease in our stock price during the period.

Results of Operations for the Six Months Ended June 30, 2025 and 2024

The following table summarizes our results of operations for the six months ended June 30, 2025 and 2024, together with the changes in those items in dollars and percentage (dollars in thousands):

Revenue. For the six months ended June 30, 2025 and, 2024, revenue consists of $1.6 million and $2.1 million, respectively, in license agreement revenue associated with the GSK License Agreement.

Research and Development.For the six months ended June 30, 2025, research and development expenses decreased to $12.3 million compared to $14.0 million for the six months ended June 30, 2024. The decrease of $1.7 million, or 12%, for the six months ended June 30, 2025, was primarily driven by a decrease of $1.3 million in CMC expense, a decrease of $0.5

million in clinical expense, a decrease of $0.2 million in salary expense, and a net decrease in other research and development expense of $0.5 million, offset in part by an increase of $0.8 million in preclinical expense.

The $1.3 million decrease in CMC expense is primarily associated with a $1.6 million decrease in expense associated with the manufacturing of drug product for SCY-247 and ibrexafungerp. The $0.5 million decrease in clinical expense was primarily due to a $1.3 million decrease in clinical expense for the FURI and CARES studies which were completed in the prior comparable period, a $0.2 million decrease in clinical expense associated with the Phase 3 MARIO study, a $0.3 million decrease in clinical expense associated with the VANQUISH study, and a net decrease of $1.0 million in other clinical expense, offset in part by a $2.3 million increase in clinical expense for the Phase 1 study for SCY-247. The $0.8 million increase in preclinical expense was primarily associated with certain preclinical costs associated with the continued development of SCY-247.

Selling, General & Administrative. For the six months ended June 30, 2025, selling, general and administrative expense increased to $7.5 million compared to $6.8 million for the six months ended June 30, 2024. The increase of $0.7 million, or 10%, for the six months ended June 30, 2025, was primarily driven by an increase of $0.3 million in business development expense, an increase of $0.3 million in salary expense, and a net increase of $0.1 million in other selling, general, and administrative expense.

Amortization of Debt Issuance Costs and Discount. For the six months ended June 30, 2025 and 2024, we recognized $0.3 million and $0.8 million in amortization of debt issuance costs and discount, respectively. The debt issuance costs and discount for our March 2019 convertible notes, which were fully paid at maturity in March 2025, primarily consisted of an allocated portion of advisory fees and other issuance costs and the initial fair value of the derivative liability.

Interest Income. For the six months ended June 30, 2025 and 2024, we recognized $1.3 million and $2.4 million, respectively, in interest income on our money market funds and investments.

Interest Expense. For the six months ended June 30, 2025 and 2024, we recognized $0.2 million and $0.4 million in interest expense on our March 2019 convertible notes which were fully paid at maturity in March 2025.

Warrant Liabilities Fair Value Adjustment. For the six months ended June 30, 2025 and 2024, we recognized gains of $5.1 million and $3.8 million, respectively, in the fair value adjustment related to the warrant liabilities primarily due to the decrease in our stock price during the periods.

Derivative Liability Fair Value Adjustment. For the six months ended June 30, 2024, we recognized a gain of $0.2 million in the fair value adjustment related to the derivative liability primarily due to the decrease in our stock price during the period.

Income Tax Expense. For the six months ended June 30, 2024, our income tax expense recognized consists primarily of an expense for U.S. federal income tax.

Liquidity and Capital Resources

Sources of Liquidity

As of June 30, 2025, we had cash and cash equivalents and investments of $46.5 million, compared to cash and cash equivalents and short-term investments of $75.1 million as of December 31, 2024. We believe our capital resources are sufficient to fund our on-going operations for a period of at least 12 months subsequent to the issuance of the accompanying unaudited condensed consolidated financial statements. As of June 30, 2025, our accumulated deficit was $388.8 million.

Consistent with our operating plan, we expect to incur significant research and development expenses and selling, general and administrative expenses. As a result of our continued significant expenses, we may need additional capital to fund our operations, which we may obtain through one or more of equity offerings, debt financings, or other non-dilutive third-party funding, strategic alliances and licensing or collaboration arrangements.

Cash Flows

The following table sets forth the significant sources and uses of cash for the six months ended June 30, 2025 and 2024 (in thousands):

Operating Activities

The $0.1 million increase in net cash used in operating activities for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024 was primarily due to the continued development costs associated with SCY-247 and ibrexafungerp in the six months ended June 30, 2025.

Net cash used in operating activities of $15.0 million for the six months ended June 30, 2025, primarily consisted of the $12.3 million net loss adjusted for non-cash charges that included the gain on change in fair value of the warrant liability of $5.1 million and stock-based compensation expense of $1.6 million, partially offset by a net favorable change in operating assets and liabilities of $0.6 million. The net favorable change in operating assets and liabilities of $0.6 million is due to a net favorable change of $1.1 million due to the decrease in operating assets offset by a net unfavorable change of $0.4 million due to the decrease in operating liabilities The net $1.1 million decrease in operating assets is primarily due to a $0.8 million decrease in prepaid expenses, other assets, deferred costs, and other. The $0.8 million decrease in prepaid expenses, other assets, deferred costs, and other was primarily due to the $0.4 million decrease in prepaid research and development services that were recognized in the six months ended June 30, 2025 and a $0.4 million decrease in other current assets. The net unfavorable change of $0.4 million in operating liabilities is primarily due to the $1.7 million increase in accounts payable, offset in part by a $1.3 million decrease in accrued expenses primarily due to the $0.9 million decrease in accrued bonus which was paid in the six months ended June 30, 2025.

Net cash used in operating activities of $14.9 million for the six months ended June 30, 2024, primarily consisted of the $14.0 million net loss adjusted for non-cash charges that included the gain on change in fair value of the warrant liabilities of $3.8 million, stock-based compensation expense of $1.5 million, and amortization of debt issuance costs and discount of $0.8 million, partially offset by a net favorable change in operating assets and liabilities of $1.4 million. The net favorable change in operating assets and liabilities was due to a net decrease in operating liabilities of $4.8 million and by a net decrease of $6.2 million in operating assets. The net $6.2 million decrease in operating assets is primarily due to a $2.2 million decrease in the license agreement receivable associated with the GSK License Agreement which was collected in the six months ended June 30, 2024 and a $4.1 million decrease in prepaid expenses, other assets, deferred costs, and other. The $4.1 million decrease in prepaid expenses, other assets, deferred costs, and other was primarily due to the collection of a $4.4 million unbilled receivable in the six months ended June 30, 2024 from GSK.

Investing Activities

Net cash provided by investing activities for the six months ended June 30, 2025 consisted of the maturities of investments of $23.7 million.

Net cash provided by investing activities of $6.8 million for the six months ended June 30, 2024 consisted of purchases and maturities of investments of $10.7 million and $17.5 million, respectively.

Financing Activities

Net cash used in financing activities of $14.1 million for the six months ended June 30, 2025, consisted primarily of the $14.0 million repayment of the convertible debt in March 2025.

Net cash used in financing activities of $15,000 for the six months ended June 30, 2024, consisted primarily of deferred financing costs of $40,000.

Future Funding Requirements

We expect to incur expenses in connection with our efforts to further development activities, particularly as we continue the research, development and clinical trials of, and seek regulatory approval for, product candidates. We anticipate that we will need substantial additional funding in connection with our continuing future operations.

We are continually evaluating our operating plan and assessing the optimal cash utilization for our SCY-247 and ibrexafungerp development strategy. We have based our estimates on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Because of the numerous risks and uncertainties associated with the development and commercialization of product candidates, we are unable to estimate the amounts of increased capital outlays and operating expenses necessary to complete the development of product candidates.

Our future capital requirements will depend on many factors, including:

Until such time, if ever, as we can generate substantial revenue from product sales, we expect to finance our cash needs through a combination of net proceeds from equity offerings, debt financings, or other non-dilutive third-party funding (e.g., grants), strategic alliances and licensing arrangements. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interests of our common stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise additional funds through sales of assets, other third-party funding, strategic alliances and licensing or collaboration arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to us.

Significant Estimates and Judgments

Our management's discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States, or GAAP. The preparation of our condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of our condensed consolidated financial statements, as well as the reported revenues and expenses during the reported periods. We evaluate these estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Our critical estimates and judgments are described within Item 7 to our Annual Report on Form 10-K for the year ended December 31, 2024.