What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-12 compared with 2025-03-17 · 110 added, 77 removed, 217 unchanged (46% of the section changed)

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Our research and development pipeline includes clinical stage and early-stage antibiotic candidates that target Gram-positive bacteria for oral and/or parenteral treatment of infections caused by Clostridium difficile (“C.

difficile”), Enterococcus (including vancomycin-resistant strains (“VRE”)), Staphylococcus (including methicillin-resistant strains), and Streptococcus (including antibiotic resistant strains).

difficile”), Enterococcus (including vancomycin-resistant strains (“VRE”)), Staphylococcus (including methicillin-resistant strains), Streptococcus (including antibiotic resistant strains) and B.

anthracis (anthrax).

Pol IIIC is required for the replication of DNA in certain Gram-positive bacterial species.

By blocking this enzyme, our antibiotic candidates are believed to be bactericidal and inhibit proliferation of several common Gram-positive bacterial pathogens, including both sensitive and resistant C.

difficile , methicillin-resistant Staphylococcus aureus (“MRSA”), vancomycin-resistant Enterococcus, penicillin-resistant Streptococcus pneumonia (“PRSP”) and other resistant bacteria.

difficile , methicillin-resistant Staphylococcus aureus (“MRSA”), vancomycin-resistant Enterococcus, penicillin-resistant Streptococcus pneumonia (“PRSP”), B.

anthracis (anthrax) and other resistant bacteria.

We intend to “de-risk” this new class of antibiotics through our drug development activities and potentially partner with a fully-integrated pharmaceutical company for late-stage clinical trials and commercialization.

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difficile infections (“CDI”).

Prior to that, we completed our Phase 2a clinical trial of ibezapolstat to treat patients with CDI and reported the top-line data in November 2020.

The Phase 2a clinical trial was terminated early based upon the recommendation of our Scientific Advisory Board (the “SAB”).

The SAB reviewed the study data presented by management, including adverse

events and efficacy outcomes, and discussed its clinical impressions.

The SAB unanimously supported the early termination of the Phase 2a trial after 10 patients were enrolled in the trial instead of 20 patients as originally planned.

The early termination was further based on the evidence of meeting the treatment goals of eliminating the infection with an acceptable adverse event profile.

The SAB noted that 10 out of 10 patients enrolled in the Phase 2a trial reached the Clinical Cure endpoint, defined in the study protocol as the resolution of diarrhea in the 24-hour period immediately before the end of treatment that is maintained for 48 hours after end of treatment.

Such cure was sustained, meaning that the patients showed no sign of infection recurrence, for 30 days thereafter.

This constitutes a 100% response rate for the primary and secondary endpoints of the trial.

All 10 patients enrolled in the Phase 2a trial met the study’s primary and secondary efficacy endpoints, namely, Clinical Cure at end of treatment and Sustained Clinical Cure of no recurrence of CDI at the 28-day follow-up visit.

No treatment-related serious adverse events (“SAEs”) were reported by the investigators who enrolled patients in the trial.

We believe these results represent the first-ever clinical data showing pol IIIC has potential as a therapeutically relevant antibacterial target.

Our Phase 2b clinical trial commenced enrollment on December 3, 2021.

The completed multicenter, open-label single-arm segment (Phase 2a) study was followed by a double-blind, randomized, active-controlled, non-inferiority, segment (Phase 2b) study at 28 U.S.

clinical trial sites which together comprise the Phase 2 clinical trial.

This Phase 2 clinical trial was designed to evaluate the clinical efficacy of

ibezapolstat in the treatment of CDI including pharmacokinetics and microbiome changes from baseline.

In the Phase 2a trial segment, 10 patients with diarrhea caused by C.

difficile were treated with ibezapolstat 450 mg orally, twice daily for 10 days.

All patients were followed for recurrence for 28± two days.

Per protocol, after 10 patients of the projected 20 Phase 2a patients completed treatment (100% cured infection at End of Treatment, 10 of 10).

In the Phase 2b trial segment, 32 patients with CDI were enrolled and randomized in a 1:1 ratio to either ibezapolstat 450 mg every 12 hours or vancomycin 125 mg orally every six hours, in each case, for 10 days and followed for 28 ± two days following the end of treatment for recurrence of CDI.

The two treatments were identical in appearance, dosing times, and number of capsules administered to maintain the blind.

In this Phase 2b trial segment, 15 out of 16 (94%) patients in Phase 2b in the Per Protocol Population experienced Clinical Cure (CC) and all 15 of 15 (100%) remained free of C.

difficile infection (CDI) recurrence through one month after EOT.

When Phase 2b results are combined with Phase 2a results, the Clinical Cure rate in patients with CDI was 96% (25 out of 26 patients), based on 10 out of 10 patients (100%) in Phase 2a in the Modified Intent to Treat Population, plus 15 out of 16 (94%) patients in Phase 2b in the Per Protocol Population, who experienced Clinical Cure during treatment with ibezapolstat.

Notably, in the combined Phase 2 trial, 100% (25 of 25) of ibezapolstat-treated patients who had Clinical Cure at EOT (End of Treatment) remained cured through one month after EOT, as compared to 86% (12 of 14) for the vancomycin patient group.

Ibezapolstat was well-tolerated, with no serious adverse events assessed by the blinded investigator to be drug- related.

The Company is confident that based on the pooled Phase 2 ibezapolstat Clinical Cure rate of 96%, Sustained Clinical Cure Rate of 100% and the historical vancomycin Clinical Cure Rate range of 70% to 92% and a Sustained Clinical Cure historical range of 42% to 74%, we will demonstrate non-inferiority of ibezapolstat to vancomycin in Phase 3 trials, in accordance with the applicable FDA Guidance for Industry (October 2022), with favorable differentiation in both Clinical Cure and Sustained Clinical Cure.

In the Phase 2 clinical trial (both trial segments), the Company also evaluated pharmacokinetics (PK) and microbiome changes and tested for anti-recurrence microbiome properties, including the change from baseline in alpha diversity and bacterial abundance, especially overgrowth of healthy gut microbiota Actinobacteria and Firmicute phylum species during and after therapy.

Phase 2a data demonstrated complete eradication of colonic C.

difficile by day three of treatment with ibezapolstat as well as the observed overgrowth of healthy gut microbiota, Actinobacteria and Firmicute phyla species, during and after therapy.

Very importantly, emerging data show an increased concentration of secondary bile acids during and following ibezapolstat therapy which is known to correlate with colonization resistance against C.

A decrease in primary bile acids and the favorable increase in the ratio of secondary-to-primary bile acids suggest that ibezapolstat may reduce the likelihood of CDI recurrence when compared to vancomycin.

The Company also reported positive extended clinical cure (ECC) data for ibezapolstat (IBZ), its lead antibiotic candidate, from the Company's recently completed Phase 2b clinical trial in patients with CDI.

This exploratory endpoint showed that 5 of 5 IBZ patients followed for up to three months following Clinical Cure experienced no recurrence of infection.

Furthermore, ibezapolstat-treated patients showed lower concentrations of fecal primary bile acids, and higher beneficial ratio of secondary to primary bile acids than vancomycin-treated patients.

Currently available antibiotics used to treat CDI infections utilize other mechanisms of action.

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We also have an early-stage pipeline of antibiotic product candidates with the same previously unexploited mechanism of action which has established proof of concept in animal studies.

This pipeline includes ACX-375C, a potential oral and parenteral treatment targeting Gram-positive bacteria, including MRSA, VRE and PRSP.

This pipeline includes ACX-375C, a potential oral and parenteral treatment targeting Gram-positive bacteria, including MRSA, VRE and PRSP and B.

anthracis (anthrax).

Pioneering data demonstrates that ibezapolstat has unique selective antibacterial activity in the gut which spares beneficial bile acid-metabolizing bacteria.

The favorable gut bile acid profile contributes to ibezapolstat's anti-recurrence effect in patients with C.

difficile Infection (CDI).

New data presented at IDWeek in October 2025 demonstrated that representative novel compounds from our DNA pol IIIC inhibitor preclinical pipeline provide initial evidence that microbiome selectivity, when compared to the comparator antibiotic, linezolid, may be a class effect.

As of December 31, 2025, we had cash of approximately $7.6 million.

Recent Developments

On August 4, 2025, we effected a 1-for-20 reverse stock split of our issued and outstanding shares of common stock, and as a result of the reverse-stock-split, on August 26, 2025, we regained compliance with the minimum bid price requirement of $1.00 per share under Nasdaq Listing Rule 5550(a)(2).

In addition, we met the minimum stockholders’ equity threshold of $2.5 million under Listing Rule 5550(b)(1).

We are now in full compliance with all Nasdaq continued listing requirements and our common stock will remain listed and traded on the Nasdaq Stock Market.

At our special meeting of stockholders, held on September 16, 2025, our stockholders approved an amendment (the “Amendment”) to our Certificate of Incorporation, as amended, to increase the total number of authorized shares of our common stock from 200,000,000 to 250,000,000.

On September 22, 2025, we filed the Amendment with the Secretary of State of the State of Delaware with immediate effect.

Equity Line of Credit Purchase Agreement

On May 8, 2025, we entered into a purchase agreement (the “Purchase Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”), pursuant to which Lincoln Park committed to purchase up to $12.0 million in shares of our common stock.

Concurrently with the execution of the Purchase Agreement on May 8, 2025, we also entered into a registration rights agreement (the “Registration Rights Agreement”) with Lincoln Park, relating to the registration under the Securities Act of 1933, as amended (the “Securities Act”), of the offer and sale of the securities that have been and may be issued and sold by us to Lincoln Park, from time to time in our sole discretion, from and after the date of this report, under the Purchase Agreement and to take such other specified actions to maintain such registration under the Securities Act.

Under the terms and subject to the conditions of the Purchase Agreement, we have the right, but not the obligation, to sell to Lincoln Park, and Lincoln Park is obligated to purchase, up to $12.0 million in shares of our common stock.

Such sales of our common stock, if any, will be subject to certain limitations, and may occur from time to time, at our sole discretion, over the 24-month period commencing on May 29, 2025, which was the date the conditions set forth in the Purchase Agreement were satisfied (the “Commencement Date”).

Sales of shares of our common stock to Lincoln Park under the Purchase Agreement will depend on a variety of factors to be determined by us from time to time, including, among others, market conditions, the trading price of our common stock and our determination as to the appropriate sources of funding for our operations.

We expect that any proceeds we receive from such sales will be used for working capital and general corporate purposes.

In connection with entering into the Purchase Agreement, on May 8, 2025, we issued 44,963 shares of our common stock to Lincoln Park in consideration for its commitment to purchase shares under the Purchase Agreement.

As of December 31 2025, we sold 751,397 shares of our common stock under the Purchase Agreement at a weighted-average price of $5.26 per share, raising approximately $4.0 million of gross proceeds and net proceeds of $3.8 million after deducting related fees and expenses.

As of March 12, 2026, total sales under the Purchase agreement are approximately $4.9 million out of $12 million.

Warrant Inducement Agreement

On June 17, 2025, we entered into a warrant inducement agreement (the “Letter Agreement”) with a certain holder (the “Holder”) of existing (i) Series A warrants to purchase 61,538 shares of common stock, (ii) Series B warrants to purchase 27,400 shares of common stock, (iii) Series C warrants to purchase 66,667 shares of common stock, and (iv) Series D warrants to purchase 66,667 shares of common stock (together, the “Existing Warrants”).

Pursuant to the Letter Agreement, the Holder exercised for cash its Existing Warrants to purchase an aggregate of 222,272 shares of common

stock, at a reduced exercised price of $12.00 per share, in consideration for our agreement to issue (i) Series G-1 warrants (the “Series G-1 Warrants”) to purchase up to an aggregate of 311,180 shares of common stock (the “Series G-1 Warrant Shares”) and (ii) Series G-2 warrants (the “Series G-2 Warrants” and, together with the Series G-1 Warrants, the “Series G Warrants”) to purchase up to an aggregate of 133,363 shares of common stock, each at an exercise price of $8.50 per share.

Pursuant to the engagement letter entered into with H.C.

Wainwright & Co., LLC (“Wainwright”) in connection with prior financings by the Company and as previously disclosed in the Company’s prior filings with the U.S.

Securities and Exchange Commission (the “SEC”), the Company paid a fee to Wainwright equal to 7.0% of the gross proceeds from the transactions contemplated by the Letter Agreement and issued to Wainwright and its designees warrants (“Wainwright Warrants”) to purchase up to an aggregate of 13,336 shares of common stock, which have the same terms as the Series G Warrants, except that they have an exercise price of $15.00 per share.

The Company received net proceeds of approximately $2.5 million from the exercise of the Existing Warrants by the Holder, after deducting offering fees and other expenses payable by the Company in connection with the transaction.

The Company expects to use the net proceeds of these transactions for general corporate and working capital purposes.

The closing of the transactions contemplated by the Letter Agreement occurred on June 20, 2025 (the “Closing Date”).

2025 March Registered Direct Offering

On March 6, 2025, we, entered into a Securities Purchase Agreement (the “March Purchase Agreement”) with an institutional investor named therein (the “March Investor”), pursuant to which we agreed to issue and sell, in a registered direct offering by us directly to the March Investor (the “March Registered Offering”) (i) 107,500 shares of common stock, par value $0.001 per share (the “Common Stock”), at a purchase price of $8.00 per share and (ii) pre-funded common stock purchase warrants (the “March Pre-Funded Warrants”) to purchase up to 29,750 shares of Common Stock (the “March Pre-Funded Warrant Shares”) at a purchase price of $7.998 per March Pre-Funded Warrant for aggregate gross proceeds of approximately $1.1 million, before deducting the placement agent fees and related offering expenses.

As of December 31, 2025, all of the March Pre-Funded Warrants were exercised.

We intend to use the net proceeds from the offering for working capital and other general corporate purposes.

The March Purchase Agreement contains customary representations and warranties and agreements of us and the March Investor and customary indemnification rights and obligations of the parties.

Pursuant to the terms of the March Purchase Agreement, we have agreed to certain restrictions on the issuance and sale of its Common Stock or Common Stock Equivalents (as defined in the March Purchase Agreement) during the 30-day period following the closing of the Registered Offering (the “Lock-up Period”).

Additionally, we agreed not to enter into a variable rate transaction for a period of one year following the closing of the March Registered Offering, provided, however, that following the Lock-up Period, (i) we may enter into and/or issue shares of Common Stock in an “at-the-market” facility with Wainwright (as defined below) as sales agent, and (ii) we may enter into, or effect a transaction under, an equity line of credit.

The Shares, the March Pre-Funded Warrants and March Pre-Funded Warrant Shares were offered by us pursuant to a registration statement on Form S-3 (File No.

333-265956), which was filed with the Securities and Exchange Commission (the “Commission”) on July 1, 2022 and was declared effective by the Commission on July 11, 2022 (the “Registration Statement”).

In a concurrent private placement (the “March Private Placement” and together with the March Registered Offering, the “March Offering”), we agreed to issue to the Investor series F common warrants (the “Series F Warrants”) to

purchase up to an aggregate of 8,235,000 shares of Common Stock.

The Series F Warrants will have an exercise price of $0.40 per share and will be exercisable commencing on the effective date of stockholder approval of the issuance of the shares of Common Stock issuable upon exercise of the Series F Warrants (the “Stockholder Approval”) and will expire twenty-four months following the date of Stockholder Approval.

We will be obligated to obtain Stockholder Approval at the Company's annual meeting of stockholders on or prior to the date that is 150 days following the closing date (the “Stockholder Meeting Deadline”).

If Stockholder Approval is not obtained on or prior to the Stockholder Meeting Deadline, we are required to cause an additional stockholder meeting to be held every 60 days after the Stockholder Meeting Deadline until Stockholder Approval is obtained or the Series F Warrants are no longer outstanding.

The Series F Warrants will have an exercise price of $8.00 per share and were exercisable commencing on July 17, 2025 and will expire on July 19, 2027.

The Series F Warrants and the shares of our Common Stock issuable upon the exercise of the Series F Warrants are not being registered under the Securities Act of 1933, as amended (the “Securities Act”), were not offered pursuant to the Registration Statement and were offered pursuant to the exemption provided in Section 4(a)(2) under the Securities Act, and Rule 506(b) promulgated thereunder.

The March Offering closed on March 10, 2025.

Nasdaq Minimum Bid Price Requirement

On February 24, 2025, we received a letter from The Nasdaq Stock Market notifying us that for the preceding 31 consecutive business days our common stock did not maintain a minimum closing bid price of $1.00 per share as required by Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”).

The notice has no immediate effect on the listing or trading of our common stock, and the common stock will continue to trade on The Nasdaq Capital Market under the symbol “ACXP” at this time.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we have a grace period of 180 calendar days, or until August 25, 2025, to regain compliance with Nasdaq Listing Rule 5550(a)(2).

Compliance can be achieved automatically and without further action if the closing bid price of our common stock is at or above $1.00 for a minimum of 10 consecutive business days at any time during the 180-day compliance period, in which case Nasdaq will notify us of our compliance and the matter will be closed.

If, however, we do not achieve compliance with the Minimum Bid Price Requirement by August 25, 2025, we may be eligible for additional time to comply.

In order to be eligible for such additional time, we will be required to meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for The Nasdaq Capital Market, with the exception of the Minimum Bid Price Requirement, and must notify Nasdaq in writing of our 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 we will not be able to cure the deficiency, or if we are otherwise not eligible, Nasdaq will provide notice that our common stock will be subject to delisting.

We would then be entitled to appeal that determination to a Nasdaq hearings panel.

We intend to actively monitor the bid price of our common stock and will consider available options to regain compliance with the Minimum Bid Price Requirement.

However, there can be no assurance that we will be able to regain compliance with the Minimum Bid Price Requirement or that Nasdaq will grant us a further extension of time to regain compliance, if applicable.

2025 January Registered Direct Offering

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Sailer, Jack H.

Dean, James Donohue, and Joseph Scodari, each a member of our board of directors (collectively, the “January Affiliate Investors”), pursuant to which we agreed to issue and sell, in a registered direct offering by us directly to the January Investors and to the January Affiliate Investors (the “January Registered Offering”), an aggregate of 2,463,058 shares of common stock (consisting of an aggregate of 2,295,570 shares purchased by the January Investors and an aggregate of 167,488 shares purchased by the January Affiliate Investors), at an offering price of $1.015 per share, for aggregate gross proceeds from

the January Registered Offering of approximately $2.5 million, before deducting the placement agent fees and related offering expenses.

The January Purchase Agreement contains customary representations and warranties and agreements of the Company and the Investors (and of the January Affiliate Investors) and customary indemnification rights and obligations of the parties.

Pursuant to the terms of the January Purchase Agreement, we agreed to certain restrictions on the issuance and sale of its Common Stock or Common Stock Equivalents (as defined in the January Purchase Agreement) during the 30-day period following the closing of the January Registered Offering.

Additionally, we agreed not to enter into a variable rate transaction for a period of one year following the closing of the January Registered Offering.

(consisting of an aggregate of 114,779 shares purchased by the January Investors and an aggregate of 8,374 shares purchased by the January Affiliate Investors), at an offering price of $20.30 per share, for aggregate gross proceeds from the January Registered Offering of approximately $2.5 million, before deducting the placement agent fees and related offering expenses.

The shares were offered by us pursuant to the Registration Statement, which was filed with the Commission on July 1, 2022 and was declared effective by the Commission on July 11, 2022.

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The January Offering closed on January 7, 2025.

As of the date of this prospectus supplement, none of the Series E warrants have been exercised and all of such Series E warrants remain outstanding.

The January Offering closed on January 7, 2025.

Nasdaq Minimum Stockholders’ Equity Requirement

On March 25, 2025, we received a letter from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) notifying us that we are not in compliance with the minimum stockholders’ equity requirement for continued listing on The Nasdaq Capital Market (the “Notice”) based on the information provided in our Annual Report on Form 10-K for the year ended December 31, 2024.

Nasdaq Listing Rule 5550(b)(1) requires that companies listed on The Nasdaq Capital Market with a market value of listed securities of less than $35,000,000 and annual net income of less than $500,000 maintain stockholders’ equity of at least $2,500,000 (the "Stockholders’ Equity Requirement”).

In accordance with Nasdaq rules, we were provided 45 calendar days to submit a plan to regain compliance with the Stockholders’ Equity Requirement (the "Compliance Plan”).

We submitted the Compliance Plan on May 9, 2025.

On August 26, 2025, we received a letter from Nasdaq notifying us that we regained compliance with Nasdaq Listing Rule 5550(b)(1).

Nasdaq Minimum Bid Price Requirement

On February 24, 2025, we received a letter from The Nasdaq Stock Market notifying us that for the preceding 31 consecutive business days, our common stock did not maintain a minimum closing bid price of $1.00 per share as required by Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”).

The notice has no immediate effect on the listing or trading of our common stock, and the common stock will continue to trade on The Nasdaq Capital Market under the symbol “ACXP” at this time.

On August 26, 2025, we received a letter from the Nasdaq notifying us that we regained compliance with Nasdaq Listing Rule 5550(a)(2).

Ibezapolstat Phase 2 Clinical Results

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In the Phase 2a segment of the clinical trial that evaluated ibezapolstat in patients with CDI, the observed Clinical Cure rate in the per protocol population was 10 out of 10 patients (100%).

In a post hoc analysis conducted with the data available at the time of discontinuation of the trial, the overall observed Clinical Cure rate for ibezapolstat in the combined Phase 2a and Phase 2b segments of the clinical trial in patients with CDI was 96% (25 out of 26 patients), based on 10 out of 10 patients (100%) in the Phase 2a segment in the per protocol population, plus 15 out of 16 (94%) patients in the Phase 2b segment We believe that, based on the post hoc pooled Phase 2 ibezapolstat Clinical Cure rate of 96% and the historical vancomycin cure rate of approximately 81% (Vancocin® Prescribing Information, January 2021), Phase 3 trials conducted in accordance with the applicable FDA Guidance for Industry (October 2022) would be able to demonstrate the non-inferiority of ibezapolstat to vancomycin, though there can be no assurance that these early-stage, Phase 2 data will predict results in Phase 3 clinical trials.

In a post hoc

analysis conducted with the data available at the time of discontinuation of the trial, the overall observed Clinical Cure rate for ibezapolstat in the combined Phase 2a and Phase 2b segments of the clinical trial in patients with CDI was 96% (25 out of 26 patients), based on 10 out of 10 patients (100%) in the Phase 2a segment in the per protocol population, plus 15 out of 16 (94%) patients in the Phase 2b segment We believe that, based on the post hoc pooled Phase 2 ibezapolstat Clinical Cure rate of 96% and the historical vancomycin cure rate of approximately 81% (Vancocin® Prescribing Information, January 2021), Phase 3 trials conducted in accordance with the applicable FDA Guidance for Industry (October 2022) would be able to demonstrate the non-inferiority of ibezapolstat to vancomycin, though there can be no assurance that these early-stage, Phase 2 data will predict results in Phase 3 clinical trials.

Further analysis of the secondary and exploratory endpoints from the Phase 2b segment showed the following:

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This is the latest in the series of granted patents and pending patent applications that we have filed to protect our proprietary technologies in the field of antimicrobials.

Following our successful End-of-Phase 2 Meeting with the FDA in August 2024, which confirmed our Phase 3 clinical trial readiness, and per the FDA regulatory requirements, in August 2024, we submitted our request to the FDA for a meeting to review our manufacturing processes and specifications for drug substance and final project and packaging (typically referred to as Chemistry, Manufacturing and Controls (“CMC”)) for our Phase 3 clinical trials.

packaging (typically referred to as Chemistry, Manufacturing and Controls (“CMC”)) for our Phase 3 clinical trials.

In December 2024, we received written positive feedback from FDA regarding acceptability of our CMC plan and data package proposed to support the Phase 3 clinical program.

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The responses also included guidance on ibezapolstat’s regulatory pathway for a Marketing Authorization Application in the EU for ibezapolstat in CDI.

2023 At-the-Market Offering

On November 15, 2023, we entered into a Sales Agreement and established the “ATM Program”, pursuant to which we may offer and sell, from time to time through A.G.P/Alliance Global Partners, as sales agent, shares of its common stock having an aggregate offering price of up to $17.0 million.

Under the Sales Agreement, the sales agent is entitled to compensation of 3% of the gross offering proceeds of all Shares sold through it pursuant to the Sales Agreement.

As of the year ended December 31, 2024, we sold a total of 2,830,328 shares of its common stock under the ATM Program at a weighted-average price of $3.26 per share, raising $9.2 million of gross proceeds and net proceeds of $8.8 million, after deducting commissions to the sales agents and other ATM Program related expenses.

There remained approximately $7.8 million available for future sales of shares of common stock under the Sales Agreement.

As of January 6, 2025, we suspended the ATM Program.

Components of our Results of Operations

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TOTAL OPERATING EXPENSES

OPERATING LOSS

Interest Income

Research and Development Expenses.

Research and development expenses were $5.4 million for the year ended December 31, 2024, and $6.0 million for the year ended December 31, 2023, a decrease of $0.6 million due to decrease in consulting fees of $1.6 million, offset by increase in manufacturing cost of $1.0 million.

Research and development expenses were $1.8 million for the year ended December 31, 2025, and $5.4 million for the year ended December 31, 2024, a decrease of $3.6 million due to a decrease in consulting fees of $2.6 million and manufacturing cost of $1.0 million as the prior year had higher expenses related to Phase 2b and Phase 3 clinical trial preparation costs.

General and Administrative Expenses.

General and administrative expenses were $6.3 million for the year ended December 31, 2025, and $8.7 million for the year ended December 31, 2024.

General and administrative expenses increased by approximately $0.2 million primarily due to $0.3 million increase in legal fees, and $0.7 million increase in professional fees, offset by $0.6 million decrease in share based compensation costs and $0.2 million decrease in insurance costs.

General and administrative expenses decreased by $2.4 million primarily due to a $0.4 million decrease in compensation costs, a $1.4 million decrease in share-based compensation costs and a $0.9 million decrease in professional fees, offset by a $0.3 million increase in legal costs.

Net loss was $8.0 million for the year ended December 31, 2025, compared to $14.1 million for the year ended December 31, 2024, a decrease of $6.1 million, primarily due to the reasons stated above.

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On July 27, 2022, we completed a registered direct offering and concurrent private placement resulting in net proceeds of approximately $3.7 million after deducting the placement agents commission of $0.3 million and offering costs of $0.2 million.

2023, we completed a registered direct offering and a concurrent private placement resulting proceeds of approximately $3.5 million after deducting the placement agents fee of $0.2 million and offering costs of $0.2 million.

On May 18, 2023, we completed a registered direct offering and a concurrent private placement resulting proceeds of approximately $3.5 million after deducting the placement agents fee of $0.2 million and offering costs of $0.2 million.

On November 15, 2023, we entered into a Sales Agreement and established the ATM Program, pursuant to which we may offer and sell, from time to time, through A.G.P./Alliance Global Partners, as sales agent, shares of our common stock having an aggregate offering price of up to $17.0 million.

Under the ATM Program, we raised net proceeds of approximately $8.8 million after deducting sales agent commission and other related expenses of $0.4 million.

As of January 6, 2025, we suspended the ATM Program.

In January 2025, we completed a registered direct offering and concurrent private placement for net proceeds of $2.1 million after deducting placement agent fees and offering expenses.

In March 2025, we completed a registered direct offering and concurrent private placement for net proceeds of $0.9 million after deducting placement agent fees and offering expenses.

On May 8, 2025, we entered into the ELOC with Lincoln Park, pursuant to which Lincoln Park committed to purchase up to $12.0 million in shares of our common stock.

Under the ELOC, we raised net proceeds of approximately $3.8 million after deducting related fees and expenses as of December 31, 2025.

On June 17, 2025, we entered into a warrant inducement agreement with existing warrant holders, receiving net proceeds of approximately $2.5 million after deducting fees and transaction expenses.

Based upon our lack of revenue expected for the foreseeable future, and because of numerous risks and uncertainties associated with the research, development and future commercialization of our product candidates, we are unable to estimate with certainty the amounts of increased capital outlays and operating expenditures associated with our anticipated clinical trials and development activities.

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Sources of Liquidity

To date, we have financed our operations principally through private placements of equity issuances, the IPO, registered direct offerings and the ATM Program.

To date, we have financed our operations principally through private placements of equity issuances, the IPO, registered direct offerings, the ATM Program and the equity line of credit purchase agreement.

Class A Membership Financings

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Warrant coverage was provided in all but our most-recent financing and the warrant coverage in our early-stage financings ranged from 25% warrant coverage to 50% warrant coverage, in each case, with a conversion price equal to the issue price in each offering.

Paycheck Protection Program Loan

In May 2020, we received a PPP Loan under the CARES ACT, as administered by the SBA in the amount of $66,503.

We did not provide any collateral or guarantees in connection with the PPP Loan, nor did we pay any facility charge to obtain the PPP Loan.

The PPP Loan carried an annual interest rate of 0.98% and was scheduled to mature two (2) years from issuance.

On April 13, 2021, the SBA authorized the full forgiveness of the PPP Loan.

Upon forgiveness of the PPP Loan, we reduced the liability and recorded a gain on the forgiveness of the PPP Loan in the statement of operations.

Initial Public Offering

In June 2021, we completed the IPO and issued and sold an aggregate 2,875,000 shares of common stock, which included 375,000 shares of our common stock issued pursuant to the underwriters’ option to purchase additional shares, at a public offering price of $6.00 per share, for net cash proceeds of $14.8 million after deducting underwriting discounts and commissions and other offering costs.

In June 2021, we completed the IPO and issued and sold an aggregate 143,750 shares of common stock, which included 18,750 shares of our common stock issued pursuant to the underwriters’ option to purchase additional shares, at

a public offering price of $120 per share, for net cash proceeds of $14.8 million after deducting underwriting discounts and commissions and other offering costs.

Registered Direct Offerings

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On January 7, 2025, we completed a registered direct offering and a concurrent private placement, issuing 123,153 shares of common stock and Series E warrants to purchase 123,153 shares of common stock for gross proceeds of approximately $2.5 million.

On March 10, 2025, we completed a registered direct offering and a concurrent private placement, issuing 2,150,000 share of common stock, 595,000 pre-funded warrants and Series F warrants to purchase 8,235,000 shares of common stock for gross proceeds of approximately $1.1 million.

On March 10, 2025, we completed a registered direct offering and a concurrent private placement, issuing 107,500 shares of common stock, 29,750 pre-funded warrants and Series F warrants to purchase 411,750 shares of common stock for gross proceeds of approximately $1.1 million.

2023 At-the-Market Offering

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Under the sales agreement, the sales agent is entitled to compensation of 3% of the gross offering proceeds of all Shares sold through it pursuant to the Sales Agreement.

There remained approximately $7.8 million available for future sales of shares of common stock under the Sales Agreement.

Through the ATM Program, we sold a total of 141,516 shares of its common stock under the ATM Program at a weighted-average price of $65.28 per share, raising $9.2 million of gross proceeds and net proceeds of $8.8 million, after deducting commissions to the sales agents and other ATM Program related expenses.

There remains approximately $7.8 million available for future sales of shares of common stock under the Sales Agreement.

On January 6, 2025, we suspended the ATM program.

Equity line of credit purchase agreement

On May 8, 2025, we entered into an equity line of credit purchase agreement (the “ELOC”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”), pursuant to which Lincoln Park committed to purchase up to $12.0 million of shares of our common stock.

We sold 751,397 shares of our common stock under the ELOC at a weighted-average price of $5.26 per share, raising $3,953,430 of gross proceeds and net proceeds of $3,808,439 after deducting related fees and expenses for the year ended December 31, 2025.

The following table sets forth a summary of the net cash flow activity for the years ended December 31, 2025 and 2024:

(in thousands)

Net cash (used in)/provided by:

Net cash provided by (used in):

Operating activities

Financing activities

Net decrease in cash

Net increase (decrease) in cash

Operating Activities

Net cash used in operating activities was $10.4 million for the year ended December 31, 2024, primarily attributable to the net loss of $14.1 million, offset by share-based compensation of $2.6 million, share based payments to vendors of $0.8 million and an increase of $0.2 million in accounts payable and accrued expenses.

Net cash used in operating activities was $6.8 million for the year ended December 31, 2025, primarily attributable to the net loss of $8.0 million, offset by share-based compensation of $1.2 million, share-based payments to vendors of $0.3 million and a decrease of $0.4 million in accounts payable and accrued expenses.

Net cash used in operating activities was $10.4 million for the year ended December 31, 2024, primarily attributable to the net loss of $14.1 million, offset by share-based compensation of $2.6 million, share-based payments to vendors of $0.8 million and an increase of $0.2 million in accounts payable and accrued expenses.

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Financing Activities

Net cash provided from financing activities was $10.6 million for the year ended December 31, 2025, which was attributable to the net proceeds from the registered direct offerings in January and March of 2025 of $3.0 million, warrant exercises of $3.8 million and sales related to the equity line of credit purchase agreement of $3.8 million.

Net cash provided from financing activities was $6.6 million for the year ended December 31, 2024, which was attributable to the ATM Program of $6.4 million and $0.2 million of proceeds from the exercise of warrants.

Net cash provided by financing activities was $8.2 million for the year ended December 31, 2023, which was attributable to the net proceeds from the 2023 registered direct offering of $3.5 million, net proceeds from the ATM Program of $2.4 million and $2.2 million of proceeds from the exercise of warrants.

Funding Requirements

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Recent Accounting Pronouncements

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures which requires public entities to disclose significant segment expenses regularly provided to the chief operating decision-maker.

Public entities with a single reporting segment have to provide all disclosures required by ASC 280, including the significant segment expense disclosures.

For public business entities, the guidance is effective for annual periods beginning after December 15, 2024.

The adoption of ASU 2023-07 did not have a significant impact on our financial accounting measurements or disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

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The amendment should be applied on a prospective basis while retrospective application is permitted.

The Company is currently evaluating the effect of this pronouncement on its disclosures.

As an emerging growth company, the Company has elected to use the extended transition period for complying with new or revised accounting standards, and therefore the guidance will be effective for the Company for fiscal years beginning after December 15, 2025.

The amendments are required to be applied on a prospective basis, with retrospective application permitted.

The Company is currently evaluating the impact of the adoption of this guidance on its financial statements and related disclosures and currently believes that it will not have a material impact on its disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, to improve transparency in financial reporting by requiring entities to present more detailed information about the nature of expenses included within the Income Statement.

The guidance will first be effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

Early adoption is permitted.

The Company currently believes that it will not have a material impact on its disclosures.

Critical Accounting Policies and Significant Judgments and Estimates

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We will continue to analyze the expected stock price volatility and will adjust our Black-Scholes option pricing assumptions as appropriate.

Any changes in the foregoing

Black-Scholes assumptions, or if we were to elect to utilize an alternative method for valuing stock options granted to employees, officers and directors, could potentially impact our stock-based compensation expense and our results of operations.

Any changes in the foregoing Black-Scholes assumptions, or if we were to elect to utilize an alternative method for valuing stock options granted to employees, officers and directors, could potentially impact our stock-based compensation expense and our results of operations.

Share-Based Payments to Vendors

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis