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Item 1. Business

2025-03-12 compared with 2024-03-28 · 179 added, 232 removed, 1084 unchanged (27% of the section changed)

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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 vitro and in vivo activity against a broad range of human fungal pathogens such as Candida and Aspergillus genera, including multidrug-resistant strains, as well as Pneumocystis , Coccidioides , Histoplasma and Blastomyces genera and most common mucorales species.

Ibrexafungerp is the first representative of this novel class of antifungals with additional assets from the “fungerp” family, including SCY-247, in preclinical stages of development.

Ibrexafungerp is the first representative of this novel class of antifungals with additional assets from the “fungerp” family under development, including SCY-247 which is currently in clinical stages of development.

In June 2021 and December 2022, we announced that the United States (U.S.) Food and Drug Administration (FDA) approved BREXAFEMME (ibrexafungerp tablets) for treatment of patients with vulvovaginal candidiasis (VVC), also known as vaginal yeast infection, and for the reduction in the incidence of recurrent vulvovaginal candidiasis (RVVC), respectively.

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

SCY-247, a second-generation antifungal compound from this novel class, is in preclinical development stage.

We anticipate initiating a Phase 1 study for SCY-247 in the second half of 2024.

SCY-247, a second-generation antifungal compound from this novel class, is in clinical development and we initiated a Phase 1 study for SCY-247 in the fourth quarter of 2024.

The FDA has granted Qualified Infectious Disease Product (QIDP) and Fast Track designations to ibrexafungerp for the indications of VVC (including the prevention of recurrent VVC), invasive candidiasis (IC) (including candidemia), and invasive aspergillosis (IA), and has granted Orphan Drug designations for the IC and IA indications.

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GSK License Agreement

On March 30, 2023, we entered into a license agreement (the GSK License Agreement) with GSK.

On March 30, 2023, we entered into a license agreement (as amended in December 2023, the GSK License Agreement) with GSK.

Pursuant to the terms of the GSK License Agreement, we granted GSK an exclusive (even as to us and our affiliates), royalty-bearing, sublicensable license for the development, manufacture, and commercialization of ibrexafungerp, including the approved product BREXAFEMME, for all indications, in all countries other than those in the Greater China region and certain other countries already licensed to third parties (the GSK Territory).

The parties closed the transactions contemplated by the GSK License Agreement in May 2023 and we received an upfront payment of $90.0 million.

In June 2023, we announced the achievement of a $25.0 million performance-based development milestone under the GSK License Agreement.

This milestone payment followed a development goal for the Phase 3 MARIO study for ibrexafungerp in IC as we continued executing ongoing ibrexafungerp trials.

In June 2023 and July 2024, we announced the achievement of a $25.0 million and a $10.0 million performance-based development milestone under the GSK License Agreement, respectively.

On December 26, 2023, we and GSK entered into a binding memorandum of understanding (Binding MOU) for amendment to the GSK License Agreement.

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• regulatory approval milestone payments of up to $49 million (revised from up to $70 million as provided in the GSK License Agreement);

• commercial milestone payments of up to $57.5 million based on first commercial sale in invasive candidiasis (U.S./EU) (revised from up to $115 million as provided in the GSK License Agreement);

• commercial milestone payments of up to $57.5 million based on first commercial sale in IC (U.S./EU) (revised from up to $115 million as provided in the GSK License Agreement);

• and sales milestone payments of up to $179.5 / $169.75 / $145.5 million (depending on the date of GSK’s relaunch of BREXAFEMME in the U.S.) (revised from up to $242.5 million as provided in the GSK License Agreement).

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and $35 / $35 / $30 million to be paid at each sales threshold of $750 million and $1 billion.

We will continue to be responsible for the execution and costs of the ongoing clinical studies of ibrexafungerp but will have the potential to receive up to $72.35 million in development milestones (revised from up to $75.5 million as provided in the GSK License Agreement), which comprise:

We will continue to be responsible for the execution and costs of the ongoing clinical studies of ibrexafungerp, which at this stage is only the MARIO study, but will have the potential to receive up to $72.35 million in development milestones (revised from up to $75.5 million as provided in the GSK License Agreement), which comprise:

$25 million already paid;

$10 million for the delivery to GSK of final clinical study reports for the completed FURI, CARES, and NATURE clinical studies;

up to $30 million for the achievement of two interim milestones associated with our resumption and continued performance of the MARIO Study after the clinical hold is lifted;

$10 million already paid for the delivery to GSK of the final clinical study reports for the completed FURI, CARES, and NATURE clinical studies;

up to $30 million for the achievement of two interim milestones associated with our resumption and continued performance of the MARIO study (as defined below) after the clinical hold is lifted;

and $7.35 million for the successful completion of the MARIO study.

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Product Recall and Clinical Hold

Following a review by GSK of the manufacturing process and equipment at the vendor that manufactures the ibrexafungerp drug substance, we became aware that a non-antibacterial beta-lactam drug substance was manufactured using equipment common to the manufacturing process for ibrexafungerp.

Following a review in 2023 by GSK of the manufacturing process and equipment at the vendor that manufactures the ibrexafungerp drug substance, we became aware that exetimibe, a non-antibacterial beta-lactam drug substance, was manufactured using equipment common to the manufacturing process for ibrexafungerp.

Current FDA draft guidance recommends segregating the manufacture of non-antibacterial beta-lactam compounds from other compounds since beta-lactam compounds have the potential to act as sensitizing agents that may trigger hypersensitivity or an allergic reaction in some people.

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It is not known whether any ibrexafungerp has been contaminated with a beta-lactam compound and we have not received any reports of adverse events due to the possible beta-lactam cross contamination.

Nonetheless, out of an abundance of caution and in line with GSK’s recommendation, we have recalled BREXAFEMME® (ibrexafungerp tablets) from the market and placed a temporary hold on clinical studies of ibrexafungerp, including the Phase 3 MARIO study.

The patient-level and clinical product recall has been initiated and we are working with an experienced vendor to manage the process.

In September 2023, after we have announced our voluntary clinical hold, the FDA concurred with our voluntary hold and placed a clinical hold.

Nonetheless, out of an abundance of caution and in line with GSK’s recommendation, we recalled BREXAFEMME® (ibrexafungerp tablets) from the market and placed a temporary hold on the clinical studies of ibrexafungerp, including the Phase 3 MARIO study.

We are in the process of destroying all of the patient-level and clinical drug product returned to date with the assistance of an experienced vendor and we are substantially complete with the product recall.

In September 2023, after we announced our voluntary clinical hold, the FDA concurred with our voluntary hold and placed a clinical hold.

We are working with the FDA to discuss paths for resolution of this issue.

The clinical hold and recall affected two ongoing clinical studies:

the Phase 3 MARIO study and a Phase 1 lactation study.

The clinical hold does not impact the recently completed FURI, CARES, VANQUISH and SCYNERGIA clinical studies, for which dosing is complete.

The NATURE study, which is an observational study in patients with IC treated with standard of care antifungals (not ibrexafungerp), is also not affected by this hold.

The FDA determined that the compassionate use program for ibrexafungerp, which provides ibrexafungerp to patients with limited or no other treatment options, can continue provided the patient’s treating physician concludes a favorable benefit-risk assessment and the patient is made aware of and consents to the risk.

This applies to patients currently in the program as well as for new patients, pending confirmation of available supply.

Our preclinical stage compound, SCY-247, is not affected by these developments.

In response to the hold on clinical studies of ibrexafungerp by the FDA due to possible beta-lactam cross contamination, we have entered into certain new manufacturing agreements with third-party contract manufacturers to begin producing new batches of ibrexafungerp which we believe will allow us to lift the clinical hold and restart our impacted clinical studies, the Phase 3 MARIO study and a Phase 1 lactation study.

Loan Agreement

We, Hercules Capital, Inc.

(Hercules Capital) and Silicon Valley Bridge Bank, N.A.

(as successor to Silicon Valley Bank) (SVBB) were parties to a Loan and Security Agreement dated as of May 13, 2021 (the Loan Agreement), pursuant to which Hercules Capital, SVBB and each of the other lenders from time-to-time party to the Loan Agreement (collectively, the Lenders) loaned to us $35 million.

In connection with the entering into of the GSK License Agreement, we entered into a First Amendment and Consent to Loan and Security Agreement (the First Amendment) with the Lenders pursuant to which the Lenders consented to us entering into the GSK License Agreement and we agreed to pay to the Lenders an amount equal to the sum of (i) all outstanding principal plus all accrued and unpaid interest with respect to the amounts loaned under the Loan Agreement (approximately $35.4 million), (ii) the prepayment fee payable under Loan Agreement ($262,500), (iii) the final payment payable under Loan Agreement ($1,382,500), and (iv) all other sums, if any, that shall have become due and payable with respect to loan advances under the Loan Agreement.

These payments became due upon the earliest of (A) one business day following receipt by us of the $90 million upfront payment payable to us under the GSK License Agreement, (B) June 1, 2023, or (C) the termination of the GSK License Agreement.

Following the closing of the transactions under the GSK License Agreement, in May 2023, we received an upfront payment pursuant to the terms of the GSK License Agreement, which triggered our obligation to repay the amounts due under the terms of the First Amendment.

In connection with the repayment of those amounts due, in May 2023, we and the Lenders

executed a payoff letter confirming the amounts due under the First Amendment, and our confirmation that the Loan Agreement, as amended by the First Amendment, was terminated.

The clinical hold and recall affected the Phase 3 MARIO study.

Our clinical stage compound, SCY-247, was not affected by these developments.

In response to the hold on clinical studies of ibrexafungerp by the FDA due to possible beta-lactam cross contamination, we have entered into certain new manufacturing agreements with third-party contract manufacturers to produce new batches of ibrexafungerp which we believe will allow us to lift the clinical hold and restart the Phase 3 MARIO study.

We are working on the resolution of this issue and we anticipate the restart of the Phase 3 MARIO study, after the FDA's lifting of the clinical hold, in the second quarter of 2025.

SCY-247 is a second-generation antifungal compound, from a novel class of structurally-distinct glucan synthase inhibitors, triterpenoids (fungerps), that are under development as therapeutic options for systemic fungal diseases.

The triterpenoid class of antifungals represents the first new class of antifungal compounds since 2001.

These agents combine the well-established activity of glucan synthase inhibitors with the potential flexibility of having oral and IV formulations.

SCY-247 is in clinical development stage and has demonstrated broad-spectrum antifungal activity, in vitro and in vivo .

We anticipate that the FDA may grant QIDP and Fast Track designations for the IV and oral formulations of SCY-247.

We continue to progress the development activities for SCY-247.

Some of these activities, including assessing the activity of the compound against multi-drug resistant pathogens such as Candida auris and Mucorales, are being supported by NIH grants.

We initiated a Phase 1 study for SCY-247 in the fourth quarter of 2024.

The Phase 1 study is a randomized, double-blind, placebo-controlled study of single and multiple ascending doses of oral SCY-247 in approximately 100 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.

Class Action Lawsuit

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(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);

(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;

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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.

We disagree with the allegations and intend to defend the litigation vigorously .

Preclinical Developments – SCY-247

The triterpenoid class of antifungals represents the first new class of antifungal compounds since 2001.

These agents combine the well-established activity of glucan synthase inhibitors with the potential flexibility of having oral and IV formulations.

SCY-247 is in preclinical development stage and has demonstrated broad-spectrum antifungal activity, in vitro and in vivo .

We anticipate that the FDA may grant QIDP and Fast Track designations for the IV and oral formulations of SCY-247.

We continue to progress the development activities for SCY-247.

Some of these activities, including assessing the activity of the compound against Candida auris and Mucorales are being supported by NIH grants.

We anticipate initiating a Phase 1 study for SCY-247 in the second half of 2024.

Mucormycosis is a life-threatening fungal infection with an associated mortality that ranges from 46% to 96%, most commonly affecting immunocompromised patients including those with leukemia, patients undergoing bone marrow transplants, and patients affected by severe COVID or uncontrolled diabetes mellitus.

In a highly lethal mouse model of mucormycosis, SCY-247 showed very promising in vivo efficacy.

Orally administered SCY-247 resulted in 40% and 50% survival at 21 days post infection for the intermediate (32 mg/kg) and high doses (48 mg/kg), respectively, compared to 0% survival in the placebo group (p = 0.011 and 0.007, respectively).

This is comparable to the 40% survival observed in the control group treated with 10 mg/kg of intravenous standard of care of liposomal amphotericin B (LAMB) (p = 0.008 vs.

Even more encouraging was a 90% survival observed in the group receiving combination therapy of SCY-247 32 mg/kg plus LAMB 10 mg/kg (p < 0.0001 vs.

placebo and p < 0.05 vs.

monotherapy).

The positive survival data correlated with a statistically significant fungal burden reduction in both lung and brain tissue with SCY-247 32 mg/kg dose (p = 0.0288 and 0.0355 vs.

placebo, respectively) and 48 mg/kg dose (p = 0.0015 and 0.0052 vs.

placebo, respectively) as well as with the active control LAMB (p = 0.0005 vs.

placebo for both lung and brain tissues).

The combination treatment of SCY-247 plus LAMB demonstrated the greatest reduction in fungal burden and was highly statistically significant in both lung and brain tissue (both p < 0.0001 vs.

We have filed a motion to dismiss.

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 were consolidated and are currently stayed.

We disagree with the allegations and we intend to defend these litigations vigorously.

Ibrexafungerp Indications

The ibrexafungerp indications below summarize the status of the indications for ibrexafungerp being developed in the hospital and community settings by us under the GSK License Agreement.

We will continue to be responsible for the execution and costs of these clinical studies of ibrexafungerp.

We will continue to be responsible for the execution and costs of the Phase 3 MARIO study, the remaining ongoing clinical study of ibrexafungerp.

For all studies listed below, we are responsible to provide to GSK the study reports upon completion of the studies.

Any NDA submissions for new indications would be made by GSK and any resulting approval(s) would be held by GSK.

Invasive Candidiasis and/or Candidemia

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If enrollment resumes, approximately 220 patients will be enrolled and randomized in the study.

The primary objective of the study is to determine whether treatment of IC with IV echinocandins followed by oral ibrexafungerp is as effective as treatment with IV echinocandins followed by oral fluconazole (or BAT), the current standard of

The primary end point of the study will be all-cause mortality at 30 days after initiation of antifungal therapy.

The primary end point of the study will be all-cause mortality at 30 days after initiation of antifungal therapy and global response.

The data from the MARIO study is intended to be supportive of an NDA submission for ibrexafungerp as step-down therapy in patients with IC.

Such submission would be made by GSK and any resulting approval would be held by GSK.

Refractory Invasive Fungal Infections (rIFI)

We enrolled 233 patients in our Phase 3 FURI study investigating the potential of ibrexafungerp as a treatment for fungal infections that are refractory or intolerant to other antifungals and we anticipate providing topline data to GSK in the first half of 2024.

We enrolled 233 patients in our Phase 3 FURI study investigating the potential of ibrexafungerp as a treatment for fungal infections that are refractory or intolerant to other antifungals.

We also achieved a target enrollment of 30 patients in our Phase 3 CARES study, focused on patients with infections caused by C.

Topline data from the CARES study is positive and consistent with previously disclosed results from interim analyses.

The results from the FURI and CARES studies are positive and consistent with previously disclosed results from interim analyses.

We provided the final clinical study reports for the FURI and CARES studies to GSK in July 2024.

It is anticipated that the data will be presented at a future scientific meeting.

The data from these studies is intended to be supportive of an NDA submission for ibrexafungerp as salvage therapy in patients with certain refractory invasive fungal diseases.

Such NDA submission would be made by GSK and any resulting approval would be held by GSK.

Invasive Aspergillosis

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This study is a randomized, double-blind trial with the objective of assessing the safety and efficacy of oral ibrexafungerp in combination with voriconazole, compared to voriconazole alone.

We completed enrollment with 22 patients included and the data analysis is ongoing.

We anticipate providing topline data for the SCYNERGIA study to GSK in the first half of 2024.

We completed the study with 22 patients enrolled and provided the final clinical study report to GSK in September 2024.

Treatment of VVC

We have completed the enrollment of the VANQUISH Phase 3b open-label trial (VANQUISH study) evaluating the safety and efficacy of ibrexafungerp in patients with complicated vulvovaginal candidiasis who failed to respond to treatment with fluconazole.

We have completed the VANQUISH Phase 3b open-label trial (VANQUISH study) evaluating the safety and efficacy of ibrexafungerp in patients with complicated vulvovaginal candidiasis who failed to respond to treatment with fluconazole.

The VANQUISH study enrolled 150 complicated VVC patients who received 600 mg of oral ibrexafungerp for one, three or seven consecutive days determined by their underlying complicating condition, including immunocompromised state.

Complicated patients include patients with recurrent VVC, those with VVC caused by non-albicans Candida species and those with diabetes, immunocompromising conditions (e.g., HIV), or immunosuppressive therapy (e.g., corticosteroids).

We anticipate providing topline data for the VANQUISH study to GSK in the first half of 2024.

We provided the final clinical study report to GSK in August 2024.

Key Development Milestones

We are seeking to achieve the following key milestones:

We are seeking to achieve the following key near term milestones:

• to lift the clinical hold placed on ibrexafungerp by the FDA to enable the resumption of enrollment in the MARIO study, a global Phase 3 study to evaluate ibrexafungerp as an oral step-down treatment for IC in the hospital setting;

• to provide topline data for the FURI study to GSK in the first half of 2024;

• to provide topline data for the Phase 2 SCYNERGIA study and the Phase 3b VANQUISH study to GSK in the first half of 2024;

• to initiate a Phase 1 study for SCY-247 in the second half of 2024.

• to complete the Phase 1 study for SCY-247 to guide for next steps of clinical development.

Key elements of our strategy include:

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• to assess external opportunities for in-licensing to expand our development pipeline and add products for commercialization.

Ibrexafungerp Target Product Profile

Ibrexafungerp, the first agent in a novel antifungal class, acts through the inhibition of the glucan synthase complex, an established target in antifungal therapeutics.

Ibrexafungerp is being developed as oral and IV formulations and has demonstrated potent activity against a large collection of medically relevant strains of Candida and Aspergillus genera, including multidrug-resistant strains, as well as Pneumocystis, Coccidioides, Histoplasma and Blastomyces genera.

Additionally, ibrexafungerp has shown in vitro , in vivo and clinical activity against multidrug-resistant organisms such as

Candida auris and synergistic/additive activity in combination with isavuconazole against Aspergillus strains and in combination with amphotericin B against fungi causing mucormycosis.

Ibrexafungerp has unique attributes that define its potential to address significant unmet medical needs and provide considerable commercial opportunities, including:

Triterpenoid Antifungals

The triterpenoid antifungals (the fungerps) are a novel antifungal class that act through the inhibition of the glucan synthase complex, an established target in antifungal therapeutics.

They are being developed as oral and IV formulations and have demonstrated potent activity against a large collection of medically relevant strains of Candida and Aspergillus genera, including multidrug-resistant strains, as well as Pneumocystis , Coccidioides , Histoplasma , and Blastomyces genera.

Additionally they have shown in vivo activity in multiple preclinical models of invasive fungal infections including IC, IA and mucormycosis.

Unique attributes of this novel class of antifungals that define its potential to address significant unmet medical needs and provide considerable commercial opportunities include:

• oral bioavailability, unlike other glucan synthase inhibitors, allowing for convenient long-term outpatient use;

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• high tissue penetration, allowing high concentrations in the organs commonly affected by fungal infections;

• generally well tolerated with over 1,600 subjects and patients exposed;

• 20-hour half-life with a low risk of drug-drug interactions.

We believe that ibrexafungerp, if approved, has the potential to address significant gaps with commercially available therapies in the following indications:

• invasive candidiasis (including resistant infections);

• invasive aspergillosis (including resistant infections);

• refractory invasive fungal infections.

In the future, we or our licensee GSK, may also consider other indications for ibrexafungerp for which longer oral antifungal regimens are typically needed and would benefit from the broad-spectrum activity, favorable safety profile and low potential for drug-drug interactions, including for the treatment of chronic fungal infections and for prophylaxis.

• half life adequate for once a day administration;

• low risk of drug-drug interactions.

Two antifungals of this novel class have progressed to clinical development:

ibrexafungerp, the first representative of this novel class to a obtain a regulatory approval, and SCY-247, our second generation fungerp.

Ibrexafungerp Product Profile

Ibrexafungerp was developed as an oral formulation for the treatment of VVC and the reduction of the incidence of RVVC.

The FDA has approved ibrexafungerp (commercial name, BREXAFEMME) for these two indications.

Additionally, oral ibrexafungerp has been studied for the treatment of refractory fungal infections and is under investigation as an oral step-down option for the treatment of IC.

GSK has licensed global rights for ibrexafungerp and any NDA submissions for new indications would be made by GSK and any resulting approval(s) would be held by GSK.

SCY-247 Product Profile

SCY-247, our second generation fungerp, entered into Phase 1 of the clinical development in the fourth quarter of 2024.

Important attributes of this molecule that we have observed in its preclinical development thus far include the well described broad spectrum of potent antifungal activity of the fungerps, high tissue concentrations, and low potential for drug-drug interactions.

We intend to develop this novel compound for oral an IV administration and will focus our development efforts to address significant unmet needs in the treatment and prevention of severe systemic or invasive fungal infections with a key focus on those infections in which antimicrobial resistance is a growing concern.

We believe that SCY-247, if approved, has the potential to address significant gaps with commercially available therapies for certain indications.

For the treatment of invasive fungal infections, we expect that prescribing physicians will be located at major medical centers, where physicians specializing in critical care, infectious disease specialists, and physicians treating immune compromised or immuno-suppressed patients, such as oncologists and those performing solid organ transplants and stem cell transplants, are likely to be found.

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We believe BREXAFEMME has the potential to address vaginal yeast infections across a broad range of patients and could be an ideal treatment option for many patients for whom current treatment options are suboptimal.

Despite yeast

infections being so common and prevalent, with millions of women suffering from them every year, it is still an under-appreciated, under-reported, and under-served women’s health condition.

Despite yeast infections being so common and prevalent, with millions of women suffering from them every year, it is still an under-appreciated, under-reported, and under-served women’s health condition.

Treatments for VVC have historically included several topical azole antifungals and oral fluconazole.

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Invasive Candidiasis / rIFI

Treatment options for invasive candidiasis are limited to three main drug classes:

Treatment options for IC are limited to three main drug classes:

echinocandins, azoles, and amphotericin B.

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Specifically, 90% of Candida auris isolates have been reported to be resistant to at least one antifungal agent and 30% of isolates resistant to at least two antifungals.

There is a clear need for new antifungal treatment options for patients with invasive candidiasis that are refractory or intolerant to available therapies as well as for those who would benefit from oral therapy.

There is a clear need for new antifungal treatment options for patients with IC that are refractory or intolerant to available therapies as well as for those who would benefit from oral therapy.

We believe ibrexafungerp has the potential to address many of these unmet needs by providing a well-tolerated oral antifungal agent, with low risk for drug-drug interactions that has activity against azole-resistant and most echinocandin-resistant strains.

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We believe that oral ibrexafungerp, if approved in combination with standard of care for the treatment of IA, would allow patients to receive the desired combination treatment of two agents with different mechanisms of action for the full six to twelve weeks of therapy, potentially leading to better outcomes.

Competition for Ibrexafungerp

Our competitors include large pharmaceutical and biotechnology companies, and specialty pharmaceutical and generic drug companies.

Competition for the Fungerps

Competitors include large pharmaceutical and biotechnology companies, and specialty pharmaceutical and generic drug companies.

The leading antifungal drugs representing each main class are as follows:

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and other global markets and marketed by Astellas in the U.S.;

Diflucan® (fluconazole), Pfizer, off-patent with multiple generics, Terazol (terconazole), Jannsen, off-patent with multiple generics, Gynazole (butoconazole), Perrigo, off patent with multiple generics;

Vivjoa® (oteseconzaole) marketed by Mycovia Pharmaceuticals, Inc., Diflucan® (fluconazole), Pfizer, off-patent with multiple generics, Terazol (terconazole), Jannsen, off-patent with multiple generics, Gynazole (butoconazole), Perrigo, off patent with multiple generics;

Echinocandins .

Cancidas® (caspofungin), a product that became generic in March 2017, and Mycamine® (micafungin), a generic product.

Rezzayo® (rezafungin) marketed by Melinta Therapeutics, Cancidas® (caspofungin), a product that became generic in March 2017, and Mycamine® (micafungin), a generic product.

Pfizer markets the echinocandin Eraxis® (anidulafungin);

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and by Dainippon-Sumitomo in Japan.

Pfizer, Merck, Astellas, and Gilead are all large pharmaceutical companies with significant experience and financial resources in the marketing and sale of specialty pharmaceuticals.

Various other producers market and sell generic oral voriconazole, fluconazole and itraconazole.

The VVC market has three generic prescription agents, fluconazole (oral), terconazole and butoconazole (topical), manufactured by multiple generic companies.

There is limited to no marketing to support these generic products.

In 2022, oral oteseconazole (brand name Vivjoa), developed and marketed by Mycovia Pharmaceuticals, Inc., was approved for the reduction in the incidence of recurrent vulvovaginal candidiasis in women who are not of reproductive potential.

Recently, in March 2023, the long-acting IV echinocandin Rezafungin (brand name Rezzayo) being developed by Cidara Therapeutics, Inc.and marketed by Melinta Therapeutics, was approved for the treatment of candidemia and invasive candidiasis in adults with limited or no alternative treatment options.

Other antifungals in development include Fosmanogepix (APX-001) being developed by Amplyx Pharmaceuticals Inc., the polyene amphotericin B oral formulation MAT2203 being developed by Matinas BioPharma Holdings Inc., and Olorofim (F901318) being developed by F2G Limited.

These companies may have greater resources than ours.

We believe that ibrexafungerp has the ability to perform well in the future fungal infection market given the limited competitive marketplace, the unmet medical need, and the often high mortality rate of many of these infections.

The key competitive factors affecting the success of ibrexafungerp, if approved, are likely to be its efficacy, safety, convenience, use in outpatient settings, the level of generic competition and the availability of reimbursement from government and other third-party payors.

If approved, we believe that ibrexafungerp’s unique features, including being from a novel antifungal class, broad-spectrum of activity including resistant strains, IV and oral formulations, fungicidal activity versus Candida , high tissue penetration, and favorable safety profile, will differentiate it from competing products and allow premium pricing to generics and other competing products.

The commercial opportunity for ibrexafungerp could be reduced or eliminated if competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than products that we or GSK may develop.

Competitors also may obtain FDA, or other regulatory, approval for their products more rapidly than we or GSK obtains approval for our ibrexafungerp products.

Other antifungals in development include Fosmanogepix being developed by Basilea Pharmaceuticals Inc., the polyene amphotericin B oral formulation MAT2203 being developed by Matinas BioPharma Holdings Inc., and Olorofim (F901318) being developed by F2G Limited.

We believe that the fungerps have the ability to perform well in the future fungal infection market given the limited competitive marketplace, the unmet medical need, and the often high mortality rate of many of these infections.

The key competitive factors affecting the success of the fungerps, if approved, are likely to be its efficacy, safety, convenience, use in outpatient settings, the level of generic competition and the availability of reimbursement from government and other third-party payors.

If approved, we believe that the fungerp's unique features, including being from a novel antifungal class, broad-spectrum of activity including resistant strains, IV and oral formulations, fungicidal activity versus Candida , high tissue penetration, and favorable safety profile, will differentiate it from competing products and allow premium pricing to generics and other competing products.

The commercial opportunity for the fungerps could be reduced or eliminated if competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than products that we or GSK (in the case of ibrexafungerp) may develop.

Competitors also may obtain FDA, or other regulatory, approval for their products more rapidly than we or GSK (in the case of ibrexafungerp) obtain approvals.

In addition, the commercial success of ibrexafungerp may be affected because in many cases insurers or other third-party payors seek to encourage the use of generic products.

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Caspofungin, the largest selling echinocandin, is now available on a generic basis.

If approved, we believe ibrexafungerp will be capable of delivering value supportive of premium pricing over competitive generic products.

If approved, we believe the fungerps will be capable of delivering value supportive of premium pricing over competitive generic products.

Manufacturing and Supply of Ibrexafungerp and SCY-247

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We have relied on third-party contract manufacturers for synthesis of our clinical compounds and manufacture of drug product.

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It is not known whether any ibrexafungerp has been contaminated with a beta-lactam compound and we have not received any reports of adverse events due to the possible beta-lactam cross contamination.

Nonetheless, out of an abundance of caution and in line with GSK’s recommendation, we have recalled BREXAFEMME (ibrexafungerp tablets) from the market and placed a temporary hold on clinical studies of ibrexafungerp, including the Phase 3 MARIO study.

The patient-level and clinical product recall has been initiated and we are working with an experienced vendor to manage the process.

We have begun engaging with the FDA and during a meeting in September 2023, the FDA concurred with our voluntary hold and placed a clinical hold.

Nonetheless, out of an abundance of caution and in line with GSK’s recommendation, we recalled BREXAFEMME® (ibrexafungerp tablets) from the market and placed a temporary hold on clinical studies of ibrexafungerp, including the Phase 3 MARIO study.

We engaged with the FDA and during a meeting in September 2023, the FDA concurred with our voluntary hold and placed a clinical hold.

We are working to provide additional information to the FDA and discuss potential paths for resolution of this issue.

The clinical hold and recall affect our two ongoing clinical studies:

the Phase 3 MARIO study and a Phase 1 lactation study.

The hold does not impact the recently completed FURI, CARES, VANQUISH and SCYNERGIA

clinical studies, for which dosing is complete.

This applies to patients currently in the program as well as for new patients, pending confirmation of available supply.

Our preclinical stage compound, SCY-247, is not affected by these developments.

The clinical hold and recall affect our ongoing Phase 3 MARIO study.

The hold did not impact the completed FURI, CARES, VANQUISH and SCYNERGIA clinical studies.

Our clinical stage compound, SCY-247, is not affected by these developments.

In response to the hold on clinical studies of ibrexafungerp by the FDA due to possible beta-lactam cross contamination, we have entered into certain new manufacturing agreements with third-party contract manufacturers to produce new batches of ibrexafungerp which we believe will allow us to lift the clinical hold and restart the Phase 3 MARIO study.

We are working on the resolution of this issue and we anticipate the restart of the Phase 3 MARIO study, after the FDA's lifting of the clinical hold, in the second quarter of 2025.

A drug manufacturing program subject to extensive governmental regulations requires robust quality assurance systems and experienced personnel with the relevant technical and regulatory expertise as well as strong project management skills.

We believe we have a team that is capable of managing these activities until GSK assumes responsibility for them pursuant to the GSK License Agreement.

We believe we have a team that is capable of managing these activities.

We believe the primary third-party vendors with which we have agreements in place to support manufacturing and supply for clinical development have the required capabilities with respect to facilities, equipment and technical expertise, quality systems that meet global regulatory and compliance requirements, satisfactory regulatory inspection history from relevant health authorities and proven track records in supplying drug substance and drug product.

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We have a number of licensing and collaboration agreements associated with our core drug development operations, including the following:

On March 30, 2023, we entered into a license agreement (the GSK License Agreement) with GSK.

On March 30, 2023 (as amended in December 2023), we entered into the GSK License Agreement.

The parties closed the transactions contemplated by the GSK License Agreement in May 2023 and we received an upfront payment of $90.0 million.

In June 2023, we announced the achievement of a $25.0 million performance-based development milestone under the GSK License Agreement.

This milestone payment followed a development goal for the Phase 3 MARIO study for ibrexafungerp in IC as we continued executing ongoing ibrexafungerp trials.

In June 2023 and July 2024, we announced the achievement of a $25.0 million and a $10.0 million performance-based development milestone under the GSK License Agreement, respectively.

The GSK License Agreement was amended in connection with the delay in the commercialization of BREXAFEMME and further clinical development of ibrexafungerp associated with this event.

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The agreement may be terminated if either party is in material breach and fails to remedy the breach after receiving written notice.

In January 2014, Merck assigned the patents to us related to ibrexafungerp that it had exclusively licensed to us.

In January 2014, Merck assigned the

patents to us related to ibrexafungerp that it had exclusively licensed to us.

Under the terms of the patent assignment, Merck no longer has responsibility to maintain the patents.

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On December 2, 2020, we entered into a fourth amendment to the license agreement with Merck.

The amendment eliminates two cash milestone payments that we would have paid to Merck upon the first filing of a NDA, triggered by the

FDA acceptance for filing of our NDA for ibrexafungerp for the treatment of VVC, and first marketing approval in the U.S.

The amendment eliminates two cash milestone payments that we would have paid to Merck upon the first filing of a NDA, triggered by the FDA acceptance for filing of our NDA for ibrexafungerp for the treatment of VVC, and first marketing approval in the U.S.

in June 2021 for our NDA for ibrexafungerp for the treatment of VVC.

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This agreement is not material to our consolidated balance sheets, statements of operations, or statements of cash flows.

Cypralis and Waterstone

In July 2016, we entered into an asset purchase agreement with UK-based Cypralis Limited (Cypralis), a life sciences company, for the sale of its cyclophilin inhibitor assets.

Cypralis also acquired all patents, patent applications and know-how related to the acquired portfolio.

In connection with the asset purchase agreement, we are eligible to receive milestone payments upon the successful progression of Cypralis clinical candidates into later stage clinical studies and royalties payable upon product commercialization.

We retain the right to repurchase the portfolio assets from Cypralis if abandoned or prioritized.

Additionally, in October 2014 we entered into a license agreement with Waterstone Pharmaceutical HK Limited (Waterstone) and granted Waterstone an exclusive, worldwide license to develop and commercialize certain non-strategic compounds.

We are entitled to receive potential milestones and royalties from Waterstone.

Government Regulation

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In addition, an IRB at each institution participating in the clinical trial must review and approve the plan for any clinical trial before it commences at that institution.

Information about certain clinical trials must be submitted within specific timeframes to the National Institutes of Health (NIH) for public dissemination on their ClinicalTrials.gov website.

Information about certain clinical trials must be submitted

within specific timeframes to the National Institutes of Health (NIH) for public dissemination on their ClinicalTrials.gov website.

Human clinical trials are typically conducted in three sequential phases, which in some cases may overlap or be combined:

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This rolling review is available if the applicant provides, and the FDA approves, a schedule for the submission of the remaining information and the applicant pays applicable user fees.

However, the FDA's time period goal for reviewing an application does not begin until the last section of the NDA is submitted.

However, the FDA's time period goal for reviewing an application does not begin until the last section of

the NDA is submitted.

Additionally, Fast Track designation may be withdrawn by the FDA if the FDA believes that the designation is no longer supported by data emerging in the clinical trial process.

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There also are continuing annual user fee requirements for any marketed products and the establishments at which such products are manufactured, as well as application fees for supplemental applications with clinical data.

Even if the FDA approves a product, it may limit the approved indications for use of the product, require that contraindications, warnings or precautions be included in the product labeling, including a boxed warning, require that post‑approval studies, including Phase 4 clinical trials, be conducted to further assess a drug’s safety after approval, require testing and surveillance programs to monitor the product after commercialization, or impose other conditions, including distribution restrictions or other risk management mechanisms under a REMS, which can materially affect the potential market

and profitability of the product.

The FDA may prevent or limit further marketing of a product based on the results of post‑marketing studies or surveillance programs.

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Accordingly, we are, or may become, subject to numerous data privacy and security obligations, including federal, state, local, and foreign laws, regulations, guidance, and industry standards related to data privacy and security.

Such obligations may include, without limitation, the Federal Trade Commission Act, the California Consumer Privacy Act of 2018 (CCPA), the Canadian Personal Information Protection and Electronic Documents Act, Canada’s Anti-Spam Legislation, the European Union’s General Data Protection Regulation 2016/679 (EU GDPR), the EU GDPR as it forms part of United Kingdom (UK) law by virtue of section 3 of the European Union (Withdrawal) Act 2018 (UK GDPR), and the Payment Card Industry Data Security Standard (PCI DSS).

Kingdom (UK) law by virtue of section 3 of the European Union (Withdrawal) Act 2018 (UK GDPR), and the Payment Card Industry Data Security Standard (PCI DSS).

Several states within the United States have enacted or proposed data privacy and security laws.

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Also, the CCPA provides for civil penalties and a private right of action for data breaches which may include an award of statutory damages.

subject to the CCPA’s private right of action, and establishing a new California Privacy Protection Agency to implement and enforce the new law.

In addition, the California Privacy Rights Act of 2020 (CPRA), effective January 1, 2023, expanded the CCPA by, among other things, giving California residents the ability to limit use of certain sensitive personal data, establishing restrictions on personal data retention, expanding the types of data breaches that are subject to the CCPA’s private right of action, and establishing a new California Privacy Protection Agency to implement and enforce the new law.

Foreign data privacy and security laws (including but not limited to the EU GDPR and UK GDPR) impose significant and complex compliance obligations on entities that are subject to those laws.

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• analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non- governmental third-party payors, including private insurers.

For example, sales, marketing and scientific/educational grant programs must comply with the federal and state anti-fraud and abuse laws, false claims laws, the privacy provisions of the Health Insurance Portability and Accountability Act, or HIPAA, and payment transparency laws.

If our operations are found to be in violation of any of the federal and state healthcare laws described above or any other governmental regulations that apply to us, we may be subject to significant penalties, including civil, criminal and administrative sanctions, damages, disgorgement, monetary fines, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, imprisonment, integrity oversight and reporting obligations, and contractual damages.

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Pharmaceutical Coverage, Pricing and Reimbursement

Our ability to commercialize BREXAFEMME and any of our product candidates successfully will depend in part on the extent to which the United States and foreign governmental authorities, private health insurers and other third-party payors establish appropriate coverage and reimbursement levels for our product candidates and related treatments.

The ability to commercialize BREXAFEMME and any of our product candidates successfully will depend in part on the extent to which the United States and foreign governmental authorities, private health insurers and other third-party payors establish appropriate coverage and reimbursement levels for our product candidates and related treatments.

In many of the markets where we would commercialize a product following regulatory approval, the prices of pharmaceutical products are subject to direct price controls (by law) and to drug reimbursement programs with varying price control mechanisms.

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This pricing methodology provides a single payment amount to hospitals based on a given diagnosis-related group.

As a result, with respect to Medicare reimbursement for services in the hospital inpatient setting, hospitals could have a financial incentive to use the least expensive drugs for the treatment of invasive fungal infections, particularly the IV formulations of these drugs, as they are typically administered in the hospital.

As a result, with respect to Medicare reimbursement for services in the

hospital inpatient setting, hospitals could have a financial incentive to use the least expensive drugs for the treatment of invasive fungal infections, particularly the IV formulations of these drugs, as they are typically administered in the hospital.

Further, coverage policies and third-party reimbursement rates may change at any time.

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pharmaceutical industry.

There have been executive, judicial and congressional challenges to certain aspects of the Affordable Care Act.

For example, on June 17, 2021 the U.S.

Supreme Court dismissed a challenge on procedural grounds that argued the Affordable Care Act is unconstitutional in its entirety because the “individual mandate” was repealed by Congress.

On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022, or IRA, into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in Affordable Care Act marketplaces through plan year 2025.

There have been amendments to and executive, judicial and congressional challenges to certain aspects of the Affordable Care Act.

On August 16, 2022, the Inflation Reduction Act of 2022, or IRA, was signed into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in Affordable Care Act marketplaces through plan year 2025.

The IRA also eliminates the "donut hole" under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and creating a new manufacturer discount program.

It is possible that the Affordable Care Act will be subject to judicial or Congressional challenges in the future.

It is also unclear how such challenges and the healthcare reform measures of the Biden administration will impact the Affordable Care Act and our business.

It is also unclear how such challenges and the healthcare reform measures of the second Trump administration will impact the Affordable Care Act and our business.

Other legislative changes have been proposed and adopted in the United States since the Affordable Care Act was enacted.

These changes included aggregate reductions to Medicare payments to providers of 2% per fiscal year, effective April 1, 2013, which, due to subsequent legislative amendments, including the Infrastructure Investment and Jobs Act, will stay in effect until 2032 unless additional Congressional action is taken.

In January 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, reduced Medicare payments to several providers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

These laws may result in additional reductions in Medicare and other healthcare funding, which could have a material adverse effect on customers for our drugs, if approved, and accordingly, our financial operations.

There also has been increasing legislative and enforcement interest in the United States with respect to drug pricing practices, which has resulted in several Congressional inquiries, Presidential executive orders and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drug products.

For example, in July 2021, the Biden administration released an executive order, “Promoting Competition in the American Economy,” with multiple provisions aimed at prescription drugs.

In response to Biden’s executive order, on September 9, 2021, HHS released a Comprehensive Plan for Addressing High Drug Prices that outlines principles for drug pricing reform and sets out a variety of potential legislative policies that Congress could pursue as well as potential administrative actions HHS can take to advance these principles.

Further, the IRA, among other things (i) directs HHS to negotiate the price of certain high-expenditure, single-source drugs and biologics covered under Medicare and (ii) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation.

These provisions take effect progressively starting in fiscal year 2023, although they may be subject to legal challenges.

On August 29, 2023, HHS announced the list of the first ten drugs that will be subject to price negotiations, although the Medicare drug price negotiation program is currently subject to legal challenges.

It is currently unclear how the IRA will be implemented but is likely to have a significant impact on the pharmaceutical industry, although they may be subject to legal challenges.

In response to the Biden administration’s October 2022 executive order, on February 14, 2023, HHS released a report outlining three new models for testing by the CMS Innovation Center which will be evaluated on their ability to lower the cost of drugs, promote accessibility, and improve quality of care.

It is unclear whether the models will be utilized in any health reform measures in the future.

Further, on December 7, 2023, the Biden administration announced an initiative to control the price of prescription drugs through the use of march-in rights under the Bayh-Dole Act.

For example, the IRA, among other things (i) directs HHS to negotiate the price of certain high-expenditure, single-source drugs that have been on the market for at least 7 years covered under Medicare, or the Medicare Drug Price Negotiation Program, and (ii) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation.

These provisions began to take effect progressively starting in fiscal year 2023, although they may be subject to legal challenges.

On August 15, 2024, HHS announced the agreed-upon prices of the first ten drugs that were subject to price negotiations, although the Medicare Drug Price Negotiation Program is currently subject to legal challenges.

On January 17, 2025, HHS selected fifteen additional products covered under Part D for price negotiation in 2025.

Each year thereafter more Part B and Part D products will become subject to the Medicare Drug Price Negotiation Program.

Further, on December 7, 2023, an initiative to control the price of prescription drugs through the use of march-in rights under the Bayh-Dole Act was announced.

On December 8, 2023, the National Institute of Standards and Technology published for comment a Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights which for the first time includes the price of a product as one factor an agency can use when deciding to exercise march-in rights.

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It is unclear how this program will be implemented, including which drugs will be chosen, and whether it will be subject to legal challenges in the United States or Canada.

Other states have also submitted SIP proposals that are pending review by the FDA.

Other states have also

submitted SIP proposals that are pending review by the FDA.

Any such approved importation plans, when implemented, may result in lower drug prices for products covered by those programs.

The current Trump administration is pursuing policies to reduce regulations and expenditures across government including at HHS, the FDA, CMS and related agencies.

These actions, presently directed by executive orders or memoranda from the Office of Management and Budget, may propose policy changes that create additional uncertainty for our business.

Congress may introduce and ultimately pass health care related legislation that could impact the drug approval process and make changes to the Medicare Drug Price Negotiation Program created under the IRA.

Intellectual Property

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We do not expect to be profitable in the foreseeable future.

We incurred net losses in each year since our inception except for net income of $67.0 million for the year ended December 31, 2023, primarily due to the $90.0 million upfront payment received under the GSK License Agreement.

We incurred net losses in each year since our inception except for the year ended December 31, 2023 which was primarily due to the $90.0 million upfront payment received under the GSK License Agreement in May 2023.

As of December 31, 2024, we had an accumulated deficit of approximately $376.5 million.

On a prospective basis, our strategic focus, along with the commitment of our financial resources, will be directed towards the development of ibrexafungerp.

On a prospective basis, our strategic focus, along with the commitment of our financial resources, will be directed towards the development of SCY-247 and ibrexafungerp.

We had cash, cash equivalents, and investments of $75.1 million as of December 31, 2024.

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The following factors relating to our business, as well as factors described elsewhere in this report, may contribute to these fluctuations:

• the costs associated with completing the ongoing clinical studies for ibrexafungerp, which are difficult for us to predict;

• the costs associated with completing the ongoing and anticipated clinical studies for ibrexafungerp and SCY-247, which are difficult for us to predict, including the potential costs associated with the anticipated resumption of the Phase 3 MARIO study if the clinical hold is lifted;

• any delays in regulatory review and approval of ibrexafungerp;

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If we are required to conduct additional fundraising activities and we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we will be prevented from pursuing development and commercialization efforts, which will have a material adverse effect on our business, operating results and prospects.

Our operating activities may be restricted as a result of covenants related to the indebtedness under our senior convertible notes and we may be required to repay the notes and our loan payable in an event of default, which could have a materially adverse effect on our business.

On March 7, 2019, we entered into a senior convertible note purchase agreement with Puissance Life Science Opportunities Fund VI (Puissance), pursuant to which we issued and sold to Puissance $16 million of our 6.0% senior convertible notes due 2025.

We may be required to repay the outstanding notes if an event of default occurs under the note purchase agreements.

Under the note purchase agreements, an event of default will occur if, among other things:

we fail to make payments under the note purchase agreement;

we breach any of our covenants under the note purchase agreements, subject to specified cure periods with respect to certain breaches;

or we or our subsidiaries become subject to bankruptcy, insolvency or reorganization proceedings.

We may not have enough available cash or be able to raise additional funds through equity or debt financings to repay such indebtedness at the time any such event of default occurs.

In this case, we may be required to delay, limit, reduce or terminate our product development or commercialization efforts or grant to others rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Our business, financial condition and results of operations could be materially adversely affected as a result of any of these events.

Unfavorable U.S.

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and global financial markets and adverse geopolitical and macroeconomic developments.

and global market and economic

conditions have been, and continue to be, disrupted and volatile due to many factors, including component shortages and related supply chain challenges, geopolitical developments such as pandemics and conflicts and related sanctions, bank failures, and increasing inflation rates and the responses by central banking authorities to control such inflation, among others.

and global market and economic conditions have been, and continue to be, disrupted and volatile due to many factors, including component shortages and related supply chain challenges, geopolitical developments such as pandemics and conflicts and related sanctions, bank failures, and increasing inflation rates and tariffs and the responses by central banking authorities to control such inflation, among others.

General business and economic conditions that could affect our ability to access capital include fluctuations in economic growth, debt and equity capital markets, liquidity of the global financial markets, access to our liquidity within the U.S.

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We cannot be certain that ibrexafungerp will receive regulatory approval in the additional indications we are pursuing, and without regulatory approval it will not be possible to market ibrexafungerp for these indications.

Regulatory approval is a lengthy, expensive and uncertain process and there is no guarantee that ibrexafungerp will be approved by the FDA for the additional indications we are pursuing.

approval is a lengthy, expensive and uncertain process and there is no guarantee that ibrexafungerp will be approved by the FDA for the additional indications we are pursuing.

Our ability to generate additional significant revenue related to sales of ibrexafungerp by GSK, will depend on the successful development and regulatory approval of ibrexafungerp for indications in addition to the treatment of VVC and RVVC.

We currently have one product approved for sale, BREXAFEMME, which is approved for the treatment of VVC and for the reduction in the incidence of RVVC, and we cannot guarantee that we will obtain more marketable products.

We currently have one product approved which is subject to a product recall, BREXAFEMME, which is approved for the treatment of VVC and for the reduction in the incidence of RVVC, and we cannot guarantee that we will obtain more marketable products.

The development and commercialization of a product candidate, including preclinical and clinical testing, manufacturing, quality systems, labeling, approval, record-keeping, selling, promotion, marketing and distribution of products, is subject to extensive regulation by the FDA in the United States and regulatory authorities in other countries, with regulations differing from country to country.

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Delays in the commencement, enrollment and completion of clinical trials could result in increased costs to us and delay or limit our ability to obtain regulatory approval for ibrexafungerp or any future product candidates.

We do not know whether our current clinical trials of ibrexafungerp will be completed on schedule or at all, or whether any future clinical trials of ibrexafungerp or any future product candidates we may seek to develop will be allowed to commence or, if commenced, will be completed on schedule or at all.

We do not know whether our current clinical trials of ibrexafungerp and SCY-247 will be completed on schedule or at all, or whether any future clinical trials of ibrexafungerp or any future product candidates we may seek to develop will be allowed to commence or, if commenced, will be completed on schedule or at all.

The commencement, enrollment and completion of clinical trials can be delayed for a variety of reasons, including:

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Frequently, product candidates that have shown promising results in early clinical trials have subsequently suffered significant setbacks in later clinical trials.

In addition, the design of a clinical trial can determine whether its results will support approval of a product application, or approval of a supplemental application to add a new indication or other changes, and flaws or shortcomings in the design of a clinical trial may not become apparent until the clinical trial is well advanced.

In addition, the design of a clinical trial can determine whether

its results will support approval of a product application, or approval of a supplemental application to add a new indication or other changes, and flaws or shortcomings in the design of a clinical trial may not become apparent until the clinical trial is well advanced.

We may be unable to design and execute a clinical trial to support regulatory approval, or approval of supplemental applications for new indications or other changes.

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If ibrexafungerp or any future product candidates are found to be unsafe or lack efficacy, we or our collaborators will not be able to obtain regulatory approval for them and our business would be harmed.

For example, if the results of our completed, ongoing or planned Phase 2 and Phase 3 clinical trials of ibrexafungerp do not achieve, to the satisfaction of regulators, the primary efficacy endpoints and demonstrate an acceptable level of safety, the prospects for approval of ibrexafungerp would be materially and adversely affected.

For example, if the results of our completed and current Phase 3 clinical trials of ibrexafungerp do not achieve, to the satisfaction of regulators, the primary efficacy endpoints and demonstrate an acceptable level of safety, the prospects for approval of ibrexafungerp would be materially and adversely affected.

A number of companies in the pharmaceutical industry, including those with greater resources and experience than us, have suffered significant setbacks in Phase 2 and Phase 3 clinical trials, even after seeing promising results in earlier clinical trials.

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We recognize that, over time, resistance develops against every antibacterial and antifungal drug.

One or more strains of fungal pathogens may develop resistance to ibrexafungerp more rapidly than we currently expect, either because our hypothesis

of the mechanism of action is incorrect or because a strain of fungi undergoes some unforeseen genetic mutation that permits it to survive.

One or more strains of fungal pathogens may develop resistance to ibrexafungerp more rapidly than we currently expect, either because our hypothesis of the mechanism of action is incorrect or because a strain of fungi undergoes some unforeseen genetic mutation that permits it to survive.

Since we expect lower resistance relative to other antifungal drug classes to be a major factor in the commercialization of ibrexafungerp, rapid development of such resistance or development of cross resistance with echinocandins would have a major adverse impact on the acceptability and sales of ibrexafungerp.

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The pharmaceutical industry is highly competitive, with a number of established, large pharmaceutical companies, as well as many smaller companies.

products that may target the same markets as ibrexafungerp and any future product candidates we may seek to develop.

There are many foreign and domestic pharmaceutical companies, biotechnology companies, public and private universities, government agencies and research organizations actively engaged in research and development of products that may target the same markets as ibrexafungerp and any future product candidates we may seek to develop.

We expect any products we develop to compete on the basis of, among other things, product efficacy, lack of significant adverse side effects and convenience and ease of treatment.

For example, BREXAFEMME competes, and ibrexafungerp for other indications will compete, against current leading antifungal drugs, including voriconazole from the azole class, caspofungin from the echinocandin class, and liposomal amphotericin B from the polyenes class, many of which are currently available in generic form, or expected to be available in generic form at the time IV ibrexafungerp might be approved.

For example, BREXAFEMME competes, and ibrexafungerp for other indications will compete, against current leading antifungal drugs, including voriconazole from the azole class, caspofungin

from the echinocandin class, and liposomal amphotericin B from the polyenes class, many of which are currently available in generic form, or expected to be available in generic form at the time IV ibrexafungerp might be approved.

Compared to us, many of our competitors in the antifungal market have, and potential competitors for any future product candidates we may seek to develop may have, substantially greater:

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All third-party payors, whether governmental or commercial, are developing increasingly sophisticated methods of controlling healthcare costs, including mechanisms to encourage the use of generic drugs.

Congress has also considered

policies to lower the reimbursement formulas in federal and state healthcare programs.

Congress has also considered policies to lower the reimbursement formulas in federal and state healthcare programs.

Furthermore, coverage of, and reimbursement for, drugs can differ significantly from payor to payor and may require significant time and resources to obtain.

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These initiatives have ranged from proposals to fundamentally change federal and state healthcare reimbursement programs, including providing comprehensive healthcare coverage to the public under governmental funded programs, to minor modifications to existing programs.

In March 2010, Congress enacted the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or the Affordable Care Act.

In March 2010, Congress enacted the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (the Affordable Care Act).

The Affordable Care Act is designed to expand access to affordable health insurance, control healthcare spending, and improve healthcare quality.

The law included provisions to, among other things, tie Medicare provider reimbursement to healthcare quality and incentives, mandatory compliance programs, enhanced transparency disclosure requirements, increased funding and initiatives to address fraud and abuse, and incentives to state Medicaid programs to expand their coverage and services.

It also imposed an annual tax on pharmaceutical manufacturers or importers who sell “branded prescription drugs.” There have been executive, judicial and Congressional challenges to certain aspects of the Affordable Care Act.

For example, the Tax Cuts and Jobs Act of 2017 included a provision repealing, effective January 1, 2019, the tax-based shared responsibility payment imposed by the Affordable Care Act on certain individuals who fail to maintain qualifying health coverage for all or part of a year that is commonly referred to as the “individual mandate”.

On June 17, 2021 the U.S.

Supreme Court dismissed a challenge on procedural grounds that argued the Affordable Care Act is unconstitutional in its entirety because the “individual mandate” was repealed by Congress.

It also imposed an annual tax on pharmaceutical manufacturers or importers who sell “branded prescription drugs.” There have been amendments to and executive, judicial and Congressional challenges to certain aspects of the Affordable Care Act.

On August 16, 2022, the Inflation Reduction Act of 2022 (IRA) was signed into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in Affordable Care Act marketplaces through plan year 2025.

It is possible that the Affordable Care Act will be subject to judicial or Congressional challenges in the future.

It is unclear how such challenges and the healthcare reform measures of the Biden Administration will impact the Affordable Care Act and our business.

It is unclear how such challenges and the healthcare reform measures of the second Trump Administration will impact the Affordable Care Act and our business.

In addition, other legislative changes have been proposed and adopted in the United States since the Affordable Care Act was enacted.

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Such scrutiny has resulted in several recent congressional inquiries, Presidential executive orders, and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products.

For example, in July 2021, the Biden administration released an executive order, “Promoting Competition in the American Economy,” with multiple provisions aimed at prescription drugs.

In response to Biden’s executive order, on September 9, 2021, the U.S.

Department of Health and Human Services, or HHS, released a Comprehensive Plan for Addressing High Drug Prices that outlines principles for drug pricing reform and sets out a variety of potential legislative policies that Congress could pursue as well as potential administrative actions HHS can take to advance these principles.

Further, the IRA, among other things (i) directs the U.S.

Department of Health and Human Services, (HHS), to negotiate the price of certain high-expenditure, single-source drugs that have been on the market for at least 7 years covered under Medicare, or the Medicare Drug Price Negotiation Program and (ii) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation.

These provisions take effect progressively starting in fiscal year 2023.

It is unclear how the IRA will be implemented but is likely to have a significant impact on the pharmaceutical industry.

It is unclear whether the models will be utilized in any health reform measures in the future.

Further, on December 7, 2023, the Biden administration announced an initiative to control the price of prescription drugs through the use of march-in rights under the Bayh-Dole Act.

On January 17, 2025, HHS selected fifteen additional products covered under Part D for price negotiation in 2025.

Each year thereafter more Part B and Part D products will become subject to the Medicare Drug Price Negotiation Program.

Further, on December 7, 2023, an initiative to control the price of prescription drugs through the use of march-in rights under the Bayh-Dole Act was announced.

While march-in rights have not previously been exercised, it is uncertain if that will continue under the new framework.

We cannot predict what healthcare reform initiatives may be adopted in the future, particularly in light of the new presidential administration.

The current Trump administration is pursuing policies to reduce regulations and expenditures across government including at HHS, the FDA, CMS and related agencies.

These actions, presently directed by executive orders or memoranda from the Office of Management and Budget, may propose policy changes that create additional uncertainty for our business.

We cannot predict what healthcare reform initiatives may be adopted in the future.

Further federal, state and foreign legislative and regulatory developments are likely, and we expect ongoing initiatives to increase pressure on drug pricing, which could have a negative impact on our sales of any future approved products.

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Promotional communications with respect to prescription drugs are subject to a variety of legal and regulatory restrictions and must be consistent with the information in the product’s approved label.

As such, we may not

promote products for indications or uses for which they do not have approval.

As such, we may not promote products for indications or uses for which they do not have approval.

Failure to comply with FDA advertising and promotion standards, which are often subject to interpretation by regulators, may result in a wide range of exposure and liability for us.

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Companies have been prosecuted for causing false claims to be submitted because of the marketing of their products for unapproved uses and have also been prosecuted on other legal theories of Medicare and Medicaid fraud.

The federal Health Insurance Portability and Accountability Act of 1996.

or HIPAA, which prohibits, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, regardless of

the payor (e.g., public or private).

The federal Health Insurance Portability and Accountability Act of 1996 (HIPAA) which prohibits, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, regardless of the payor (e.g., public or private).

Similar to the federal Anti-Kickback Statute, a person or entity need not have actual knowledge the statute or specific intent to violate it, in order to have committed a violation.

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Government agencies may issue regulations and guidelines directly applicable to us, our partners or our potential future partners and our product candidates.

In addition, professional societies, practice management groups, private health/science foundations and organizations involved in various diseases from time to time publish guidelines or recommendations to the healthcare and patient communities.

healthcare and patient communities.

These various sorts of recommendations may relate to such matters as product usage, dosage, and route of administration and use of related or competing therapies.

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Under the GSK License Agreement, GSK is to pay us milestone payments upon our achievement of specified regulatory, commercial and sales milestone events, as well as royalties on sales of ibrexafungerp in those countries in its territory.

determines not to pursue commercialization of ibrexafungerp in those countries, we will not receive any commercial or sales milestone or royalty payments under the GSK License Agreement.

If GSK determines not to pursue commercialization of ibrexafungerp in those countries, we will not receive any commercial or sales milestone or royalty payments under the GSK License Agreement.

We are dependent on our existing third-party collaboration with Hansoh to commercialize ibrexafungerp in the Greater China region, and if Hansoh is not successful in commercializing ibrexafungerp in these areas, we will lose a significant source of potential revenue.

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We are relying on R-Pharm to commercialize ibrexafungerp in the countries covered by our agreement with it, and if R-Pharm is not able to commercialize ibrexafungerp in those countries, or determines not to pursue commercialization of ibrexafungerp in those countries, we will not receive any milestone or royalty payments under the agreement.

On February 24, 2022, Russia launched an invasion of Ukraine which has resulted in increased volatility in various financial markets and across various sectors.

and other countries, along with certain international organizations, have imposed economic sanctions on Russia and certain Russian individuals, banking entities and corporations as a response to the invasion.

The extent and duration of the military action, resulting sanctions and future market disruptions in the region are impossible to predict.

Moreover, the ongoing effects of the hostilities and sanctions may not be limited to Russia and Russian companies and may spill over to and negatively impact other regional and global economic markets of the world, including Europe and the U.S.

Generally, worldwide economic conditions remain uncertain, particularly due to the effects of the war between Russia and Ukraine and the conflicts in the Middle East, disruptions in the banking system and financial markets, and increased inflation.

The ongoing geopolitical conflicts in various parts of the world, including but not limited to Russia, Ukraine and the Middle East, are difficult to predict.

The ongoing military action along with the potential for a wider conflict could further increase financial market volatility and cause negative effects on regional and global economic markets, industries, and companies.

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In some cases, we may be responsible for continuing preclinical and initial clinical development of a partnered product candidate or research program, and the payment we receive from our collaboration partner may be insufficient to cover the cost of this development.

If we are unable to reach agreements with suitable collaborators for product candidates, we could face increased costs, we may be forced to limit the number of product candidates we can commercially develop or the territories in which we commercialize them and we might fail to commercialize products or

programs for which a suitable collaborator cannot be found.

If we fail to achieve successful collaborations, our operating results and financial condition will be materially and adversely affected.

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In addition, any contract research organization that we retain will be subject to the FDA’s regulatory requirements and similar foreign standards and we do not have control over compliance with these regulations by these providers.

Consequently, if these practices and standards are not adhered to by

these providers, the development and commercialization of ibrexafungerp and any future product candidates we may seek to develop could be delayed, which could severely harm our business and financial condition.

Consequently, if these practices and standards are not adhered to by these providers, the development and commercialization of ibrexafungerp and any future product candidates we may seek to develop could be delayed, which could severely harm our business and financial condition.

Risks Relating to Our Intellectual Property

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Patent and Trademark Office (USPTO) courts in the United States or by the patent offices and courts in foreign countries.

Method of use patents protect the use of a product for the method recited in

Method of use patents protect the use of a product for the method recited in the claims.

This type of patent does not prevent a competitor from making and marketing a product that is identical to our product for an indication that is outside the scope of the patented method.

Moreover, even if competitors do not actively promote their product for our targeted indications, physicians may prescribe these products “off-label.” Although off-label prescriptions may infringe or contribute to or induce the infringement of method of use patents, the practice is common and such infringement is difficult to prevent or prosecute.

Moreover, even if competitors do not actively promote their product for our targeted indications, physicians may prescribe these products “off-label.” Although off-label

prescriptions may infringe or contribute to or induce the infringement of method of use patents, the practice is common and such infringement is difficult to prevent or prosecute.

Interference or derivation proceedings provoked by third parties or brought by the USPTO may be necessary to determine the priority of inventions with respect to our patents or patent applications or those of our collaborators or licensors.

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The pharmaceutical and biotechnology industries have produced a proliferation of patents, and it is not always clear to industry participants, including us, which patents cover various types of products or methods of use.

The coverage of patents is

subject to interpretation by the courts, and the interpretation is not always uniform.

The coverage of patents is subject to interpretation by the courts, and the interpretation is not always uniform.

If we are sued for patent infringement, we would need to demonstrate that our products or methods either do not infringe the patent claims of the relevant patent or that the patent claims are invalid or unenforceable, and we may not be able to do this.

Proving invalidity or unenforceability is difficult.

Proving invalidity or unenforceability is

For example, in the United States, proving invalidity requires a showing of clear and convincing evidence to overcome the presumption of validity enjoyed by issued patents.

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As of March 1, 2025, we had 28 full time employees.

Further, as we advance ibrexafungerp and SCY-247 through preclinical studies, clinical trials and commercialization for other indications, we will need to increase our product development, scientific, marketing, sales and administrative headcount to manage these efforts.

Further, as we advance ibrexafungerp and SCY-247 through clinical studies, clinical trials and commercialization for other indications, we will need to increase our product development, scientific, marketing, sales and administrative headcount to manage these efforts.

Our management, personnel and systems currently in place may not be adequate to support this future growth.

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We have obtained limited product liability insurance coverage for our clinical trials domestically and in selected foreign countries where we are conducting clinical trials as required by local country regulations, in addition to limited product liability coverage for BREXAFEMME.

Our coverage is currently limited to $25.0 million per occurrence and $25.0 million in the aggregate per year.

Our annual limit is $25.0 million per occurrence and $25.0 million aggregate.

As such, our insurance coverage may not reimburse us or may not be sufficient to reimburse us for any expenses or losses we may suffer.

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These sales may also result in new investors gaining rights superior to our existing stockholders.

For example, in March 2019, we issued and sold $16 million of 6.0% convertible senior notes.

The holders may convert their convertible notes at their option at any time prior to the close of business on the business day immediately preceding March 15, 2025.

Upon conversion of the convertible notes by a holder, the holder will receive shares of our common stock, together, if applicable, with cash in lieu of any fractional share.

Holders who convert may also be entitled to receive, under certain circumstances, an interest make-whole payment payable in shares of common stock.

In addition, following certain corporate events that occur prior to the maturity date, we will, in certain circumstances, increase the conversion rate for a holder who elects to convert its convertible notes in connection with such a corporate event.

To the extent holders of these notes convert the notes, our stockholders may experience substantial dilution.

Additionally, the holders of our outstanding warrants also may exercise their right to buy our common stock which could result in additional dilution to our stockholders.

For example, on November 6, 2024, we entered into a Controlled Equity Offering SM Sales Agreement (the Sales Agreement) with Cantor Fitzgerald & Co., as sales agent, pursuant to which we may issue and sell shares of our common stock for an aggregate maximum offering price of $50.0 million under an “at-the-market” offering program under which we have sold zero shares of our common stock as of December 31, 2024.

In addition, as opportunities present themselves, we may enter into financing or similar arrangements in the future, including the issuance of debt securities or equity.

Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.

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Although we believe these provisions together provide for an opportunity to receive higher bids by requiring potential acquirers to negotiate with our board of directors, they would apply even if the offer may be considered beneficial by some stockholders.

Our business could be adversely affected by the continuation of the exposure to COVID-19, in regions where we or third parties on which we rely have significant concentrations of clinical trial sites, manufacturing facilities, or other business operations.

We have a significant number of clinical trial sites in countries that have been directly affected by COVID-19, and depend on manufacturing operations for various stages of our supply chain in countries affected by COVID-19.

The ultimate impact of COVID-19 is highly uncertain and subject to change.

We do not yet know the full extent of potential delays or impacts on our business, our clinical trials, our activities dependent on regulatory authorities, healthcare systems or the global economy as a whole.

However, these effects could have a material impact on our operations, and we will continue to monitor the COVID-19 situation closely.

UNRESOLV ED STAFF COMMENTS

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Risk Management and Strategy

We have implemented and maintain various information security processes designed to identify, assess and manage material risks from cybersecurity threats to our critical computer networks, third party hosted services, and our critical data, including intellectual property, confidential information that is proprietary, strategic or competitive in nature such as data about our research and clinical trials (“Information Systems and Data”).

Our information security function, which includes our information technology Managed Service Provider (MSP), helps identify, assess and manage the Company’s cybersecurity threats and risks.

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an incident response process;

disaster recovery/business continuity plans;

disaster recovery/business

continuity plans;

encrypting certain data;

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In addition, the Company’s incident response process includes reporting to the Audit Committee for certain cybersecurity incidents.

The Audit Committee receives periodic reports from company management, including our Chief Legal Officer, concerning the Company’s significant cybersecurity threats and risk and the processes the Company has implemented to

address them.

The Audit Committee also has access to various reports, summaries or presentations related to cybersecurity threats, risk and mitigation.

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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 1. Business