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Item 2. Management’s Discussion and Analysis

2025-08-12 compared with 2025-05-13 · 167 added, 91 removed, 182 unchanged (59% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion and analysis of our financial condition and results of operations together with the unaudited financial information and the notes thereto included appearing elsewhere in this Quarterly Report on Form 10-Q, and the audited financial information and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024.

You should read the following discussion and analysis of our financial condition and results of operations together with the unaudited financial information and the notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q, and the audited financial information and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024.

Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties.

As a result of many factors, including those factors set forth in the “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q, our actual results could differ materially from the results described in, or implied by, the forward-looking statements contained in the following discussion and analysis.

We are a clinical-stage biopharmaceutical company focused on identifying and developing novel treatments for rare diseases and diseases caused by multi-drug resistant (“MDR”) bacterial infections with high unmet need.

Our most advanced clinical stage product candidate, tebipenem HBr, is in Phase 3 development, with the potential to be the first broad-spectrum oral carbapenem to treat adult patients with complicated urinary tract infections (“cUTIs”), including acute pyelonephritis, caused by certain microorganisms.

We are a clinical-stage biopharmaceutical company focused on identifying and developing novel treatments for rare diseases and diseases caused by MDR bacterial infections with high unmet need.

Our most advanced clinical-stage product candidate, tebipenem HBr, is in Phase 3 development, with the potential to be the first broad-spectrum oral carbapenem to treat adult patients with cUTIs, including pyelonephritis, caused by certain microorganisms.

In May 2025, we and GSK announced that the pivotal Phase 3 PIVOT-PO trial evaluating tebipenem HBr met its primary endpoint and had stopped early for efficacy.

The other program in our pipeline is SPR720, a product candidate for first-line treatment of nontuberculous mycobacterial (“NTM”) pulmonary disease (“NTM-PD”).

In October 2024, we announced that results from a planned interim analysis of our Phase 2a clinical trial for SPR720 demonstrated the oral agent did not meet its primary endpoint and we elected to suspend development of SPR720 in its oral formulation.

We are currently completing analysis of remaining data from all 25 patients dosed in the trial ahead of determining next steps.

We are currently determining next steps for SPR720.

Additionally, in March 2025, following a reprioritization of our programs, we announced that we are no longer pursuing a Phase 2 clinical trial for SPR206, which was previously included in our pipeline.

We have experienced mostly net losses and significant cash outflows from cash used in operating activities since our inception.

Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our product candidates.

As of March 31, 2025, we had an accumulated deficit of $473.5 million, and cash and cash equivalents of $48.9 million.

As of June 30, 2025, we had an accumulated deficit of $475.2 million, and cash and cash equivalents of $31.2 million.

We expect to continue to incur significant expenses and operating losses for at least the next year.

Based on our cash and cash equivalents as of March 31, 2025, together with earned and non-contingent development milestone payments from GSK, we believe that our cash runway will be sufficient to fund our operating expenses and required capital expenditures into the second quarter of 2026.

During this period, we plan to prioritize advancing the Phase 3 clinical trial activities for tebipenem HBr under our GSK License Agreement and completing our analysis of the full dataset from the 25 treated patients in the Phase 2a proof-of-concept trial of SPR720.

Beyond this point we will need additional funding, which we expect will primarily consist of raising additional capital through some combination of equity or debt financings, potential new collaborations or additional grant funding.

Based on our cash and cash equivalents as of June 30, 2025, together with earned and non-contingent development milestone payments from GSK, including the final payment under the GSK License Agreement of $23.8 million received in the third quarter of 2025, and the decrease in clinical expense as a result of the PIVOT-PO Phase 3 trial for tebipenem HBr stopping early for efficacy following positive interim analysis results, we believe that our cash runway will be sufficient to fund our operating expenses and required capital expenditures into 2028.

During this period, we plan to prioritize finalizing the Phase 3 clinical trial activities for tebipenem HBr under our GSK License Agreement.

Beyond this point, or in the event we change our current operating plan, we will need substantial additional funding to support our continuing operations and pursue our growth strategy.

Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through a combination of equity offerings, debt financings, government funding arrangements, collaborations, strategic alliances and marketing, distribution or licensing arrangements.

If we are not able to secure adequate additional funding, we plan to make further reductions in spending.

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The actions necessary to reduce spending under this plan at a level that mitigates the factors described above is not considered probable, as defined in the accounting standards and therefore, the full extent to which management may extend our funds through these actions may not be considered in management’s assessment of our ability to continue as a going concern.

As a result, management has concluded that substantial doubt exists about our ability to continue as a going concern.

We will not generate revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for our product candidates.

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Further, we expect to incur additional costs associated with our continued operation as a public company.

As a result, we will need substantial additional funding to support our continuing operations and pursue our growth strategy.

We may be unable to raise additional funds or enter into such other agreements or arrangements when needed on favorable terms, or at all.

If we fail to raise capital or enter into such agreements as, and when needed, we may have to significantly delay, scale back or discontinue the development and commercialization of one or more of our product candidates.

Because of the numerous risks and uncertainties associated with pharmaceutical product development, we are unable to accurately predict the timing or amount of increased expenses or when or if we will be able to achieve or maintain profitability.

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Recent Developments

Nasdaq Deficiency Letter

On February 25, 2025, we received a deficiency letter from the Listing Qualifications Department informing us that we were not in compliance with the continued listing requirements of the Nasdaq Global Select Market (“Nasdaq GS”) because the bid price for our common stock had closed below $1.00 per share for 30 consecutive business days.

We have until August 25, 2025 to regain compliance with the bid price requirement.

If we do not regain compliance with the bid price requirement, our common stock will be subject to delisting.

Any potential delisting of our common stock could have a material adverse effect on the market for, and liquidity and price of, our common stock and would adversely affect our ability to raise capital on terms acceptable to us, or at all.

Nasdaq Deficiency Letter and Regained Compliance

On February 25, 2025, we received a deficiency letter from the Listing Qualifications Department of the Nasdaq Stock Market LLC informing us that we were not in compliance with the continued listing requirements of the Nasdaq GS because the bid price for our common stock had closed below $1.00 per share for 30 consecutive business days.

On June 12, 2025, we received a letter from the Listing Qualifications Department informing us that we had regained compliance with the bid price requirement and the matter is now closed.

Management Transitions and Board Composition

In January 2025, the independent directors of our Board of Directors approved the following actions as a matter of corporate governance best practices and to enable us to maintain focus on pursuing our business objectives pending resolution of a “Wells Notice” received from the staff of the Boston Regional Office (the “Staff”) of the SEC, as further described in Part II, Item 1 “Legal Proceedings” of this Quarterly Report on Form 10-Q.

In January 2025, the independent directors of our Board of Directors approved the following actions as a matter of corporate governance best practices and to enable us to maintain focus on pursuing our business objectives pending resolution of a “Wells Notice” received from the Staff of the SEC, as further described in Part II, Item 1 “Legal Proceedings” of this Quarterly Report on Form 10-Q.

• The Board of Directors appointed director Frank Thomas to serve as the Chairman of the Board of Directors, stepping in for Ankit Mahadevia, M.D.

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In connection with the foregoing, Ms.

Rajavelu has also been nominated for election to serve as a member of our Board of Directors at our 2025 annual meeting of stockholders.

Rajavelu was nominated for election to serve as a member of our Board of Directors at our 2025 annual meeting of stockholders and was elected to the Board of Directors in June 2025.

In connection with the foregoing, we and Ms.

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Tebipenem HBr

As previously announced in March 2025, a pre-specified interim analysis of PIVOT-PO is expected to be completed in the second quarter of 2025.

In March 2025, following a reprioritization of its programs, we announced that we are no longer pursuing a planned Phase 2 clinical trial for SPR206.

On April 4, 2025, U.S.

National Institute of Allergy and Infectious Diseases (“NIAID”) informed us that it was canceling the five-year contract, awarded in May 2021, under the Agency’s Omnibus Broad Agency Announcement No.

In May 2025, we and GSK announced that the pivotal Phase 3 PIVOT-PO trial evaluating tebipenem HBr, an investigational oral treatment for cUTIs, including pyelonephritis, met its primary endpoint and has stopped early for efficacy.

The decision followed a recommendation from an Independent Data Monitoring Committee (“IDMC”) that completed a pre-specified interim analysis of data from 1,690 patients enrolled in the trial.

The trial met the primary endpoint of non-inferiority of tebipenem HBr compared to intravenous imipenem-cilastatin in hospitalized adult patients with cUTI, including pyelonephritis, on overall response (composite of clinical cure plus microbiological eradication) at the test-of-cure visit.

The IDMC review did not identify any new safety concerns beyond what has been reported in other studies with tebipenem, with diarrhea and headache as the two most reported adverse events.

GSK plans to work with U.S.

regulatory authorities to include the data as part of a filing in the second half of 2025.

Full results will be submitted for presentation at an upcoming scientific meeting and for publication in a peer-reviewed journal.

Remaining potential payments under the GSK License Agreement, which include milestones and royalties based on future regulatory events, commercial launch, and achievement of pre-specified sales thresholds, are as follows (in millions):

Contingent Event

Milestone Payment

Tebipenem NDA Submission by GSK

Total potential commercial milestones based on first commercial sales

First commercial sale of a product in the United States

Second anniversary of first commercial sale of a product in the United States

First commercial sale of a product in two European countries

Total potential sales milestone payments

Net annual sales greater than $200.0

Net annual sales greater than $300.0

Net annual sales greater than $400.0

Net annual sales greater than $500.0

Net annual sales greater than $750.0

Net annual sales greater than $1,000.0

*Under the terms of the GSK License Agreement, the maximum potential milestone amount was revised from $150.0 million after PIVOT-PO was stopped early for efficacy following completion of a pre-specified interim analysis of data from 1,690 patients enrolled in the trial, thereby reducing the overall cost of the trial to the Company;

the maximum potential milestone payment of $150.0 million was contingent upon the trial continuing to full enrollment, with 2,637 patients enrolled in the trial.

In addition to the milestones described above, GSK is obligated to pay royalties to the Company on annual net sales of GSK Licensed Products in the GSK Territory.

Such royalties are 1% for annual sales up to $750.0 million each year and range from high single-digit percentages on annual net sales above $750.0 million each year to low double-digit percentages on annual net sales above $1,000 million each year.

In March 2025, following a reprioritization of its programs, we announced that we are no longer pursuing a Phase 2 clinical trial for SPR206.

On April 4, 2025, NIAID informed us that it was canceling the five-year contract, awarded in May 2021, under the Agency’s Omnibus Broad Agency Announcement No.

HHS-NIH-NIAID-BAA2020-1 award mechanism to support further development of SPR206, effective immediately, for its convenience.

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Collaboration Revenue

Collaboration revenue relates to our agreements with Pfizer Inc.

(“Pfizer”) and GSK.

Collaboration revenue relates to our agreements with Pfizer and GSK.

Operating Expenses

Research and Development Expenses

Research and development expenses consist primarily of costs incurred for our research activities, including our drug discovery efforts, and the development of our product candidates, which include:

• employee-related expenses, including salaries, related benefits, travel and share-based compensation expense for employees engaged in research and development functions;

Research and development expenses consist primarily of costs incurred for our research activities, including the development of our product candidates, and are comprised of:

• employee-related expenses, including salaries, related benefits, travel and stock-based compensation expense for employees engaged in research and development functions;

• expenses incurred in connection with the preclinical and clinical development of our product candidates, including under agreements with contract research organizations (“CROs”);

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• establishment of arrangements with third-party manufacturers to obtain manufacturing supply;

• obtainment and maintenance of patent, trade secret protection and regulatory exclusivity, both in the United States and internationally, including our ability to maintain our license agreement with Meiji Seika Pharma Co.

(“Meiji”) with respect to tebipenem HBr;

• protection of our rights in our intellectual property portfolio;

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General and Administrative Expenses

General and administrative expenses consist primarily of salaries and related costs, including share-based compensation, for personnel in executive, finance and administrative functions.

General and administrative expenses consist primarily of salaries and related costs, including stock-based compensation, for personnel in executive, finance and administrative functions.

General and administrative expenses also include direct and allocated facility-related costs as well as professional fees for legal, patent, consulting, investor and public relations, accounting and audit services.

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Restructuring

In light of our decision to suspend planned development activities for our oral SPR720 program and our strategic restructuring, we expect that our future expenses relating to development activities with respect to SPR720 will be substantially reduced as we evaluate potential paths forward for SPR720 and implement our restructuring.

In connection with our restructuring, we estimated that we would incur approximately $1.1 million of costs in connection with the reduction in workforce related to severance pay and other related termination benefits of which we incurred $0.9 million during the year ended December 31, 2024 and $0.2 million during the quarter ended March 31, 2025.

We anticipate the remaining costs to be incurred in the second quarter of 2025.

We may incur additional costs not currently contemplated due to events associated with or resulting from the workforce reduction;

however, the majority of the costs associated with our workforce reduction were incurred during the quarters ended December 31, 2024 and March 31, 2025.

In light of our decision to suspend planned development activities for our oral SPR720 program and the strategic restructuring implemented in October 2024, we expect that our future expenses relating to development activities with respect to SPR720 will be substantially reduced as we determine next steps for SPR720.

In connection with our restructuring, we estimated that we would incur approximately $1.1 million of costs in connection with the reduction in workforce related to severance pay and other related termination benefits of which we incurred $0.9 million during the year ended December 31, 2024, $0.2 million during the quarter ended March 31, 2025, and less than $0.1 million during the quarter ended June 30, 2025.

We have incurred all of the costs associated with our workforce reduction as of June 30, 2025.

Other Income (Expense)

Interest Income (Expense)

Interest income (expense) during the three months ended March 31, 2025 and 2024 consists of interest income related to the significant financing component related to the GSK License Agreement and interest earned on our cash equivalents, which are primarily invested in money market accounts, as well as interest earned on our investments in marketable securities.

Interest income (expense) during the three and six months ended June 30, 2025 and 2024 consists of interest income related to the significant financing component related to the GSK License Agreement and interest earned on our cash equivalents, which are primarily invested in money market accounts, as well as interest earned on our investments in marketable securities.

Other Income (Expense), Net

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Critical Accounting Policies and Significant Judgments and Estimates

Our consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States (“GAAP”).

Our consolidated financial statements are prepared in accordance with GAAP.

The preparation of our consolidated financial statements and related disclosures requires us to make estimates, assumptions and judgments that affect the reported amount of assets, liabilities, revenue, costs and expenses, and related disclosures.

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Our actual results may differ from these estimates under different assumptions or conditions.

We have made no changes to our existing critical accounting policies, as described in our Annual Report on Form 10-K for the year ended December 31, 2024.

Our critical accounting policies are those most critical to the judgments and estimates used in the preparation of our financial statements.

We have made no changes to our existing critical accounting policies described in our Annual Report on Form 10-K for the year ended December 31, 2024.

Results of Operations

Comparison of the Three Months Ended March 31, 2025 and 2024

The following table summarizes our results of operations for the three months ended March 31, 2025 and 2024 (in thousands):

Three Months Ended March 31,

Comparison of the Three Months Ended June 30, 2025 and 2024

The following table summarizes our results of operations for the three months ended June 30, 2025 and 2024 (in thousands):

Three Months Ended June 30,

Grant revenue

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Other income (expense), net

Total other income (expense), net

Total other income, net

Grant Revenue

Three Months Ended March 31,

Three Months Ended June 30,

BARDA Contract (Tebipenem HBr)

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Total grant revenue

Grant revenue recognized during the three months ended March 31, 2025 and 2024 consisted of the reimbursement of qualifying expenses incurred in connection with our various government awards.

The decrease in grant revenue during the three months ended March 31, 2025 was primarily due to a decrease of $4.2 million of committed funds remaining available under our BARDA contract for tebipenem HBr, and a decrease of $0.1 million under our NIAID agreement relating to SPR206.

Grant revenue recognized during the three months ended June 30, 2025 and 2024 consisted of the reimbursement of qualifying expenses incurred in connection with our various government awards.

The decrease in grant revenue during the three months ended June 30, 2025 was primarily due to a decrease of $1.7 million under our BARDA contract for tebipenem HBr, and a decrease of $0.1 million under our NIAID agreement relating to SPR206.

Collaboration Revenue

Three Months Ended March 31,

Three Months Ended June 30,

GSK (Tebipenem HBr)

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Total collaboration revenue

During the three months ended March 31, 2025, we recognized $5.1 million in collaboration revenue related to our agreement with GSK and less than $0.1 million in collaboration revenue related to our agreement with Pfizer.

During the three months ended March 31, 2024, we recognized $4.1 million in collaboration revenue related to our agreement with GSK and $0.1 million in collaboration revenue related to our agreement with Pfizer.

During the three months ended June 30, 2025, we recognized $11.8 million in collaboration revenue related to our agreement with GSK and no revenue related to our agreement with Pfizer.

During the three months ended June 30, 2024, we recognized $5.9 million in collaboration revenue related to our agreement with GSK and $0.1 million in collaboration revenue related to our agreement with Pfizer.

The increase in revenue under the GSK License Agreement was directly related to the adjusted service period due to the pivotal Phase 3 PIVOT-PO trial stopping early for efficacy in the first half of 2025 following the pre-specified interim analysis.

Research and Development Expenses

Three Months Ended March 31,

Three Months Ended June 30,

Direct research and development expenses by program:

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Unallocated expenses:

Personnel related (including share-based compensation)

Personnel related (including stock-based compensation)

Facility related and other

Total research and development expenses

Direct costs related to our tebipenem HBr program increased by $0.9 million during the three months ended March 31, 2025, compared to the three months ended March 31, 2024, due to continued clinical activities related to our pivotal Phase 3 clinical trial of tebipenem HBr, which we initiated in the fourth quarter of 2023.

Direct costs related to our SPR720 program decreased by $3.9 million during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024, due to decreased clinical activity during the period related to our Phase 2a clinical trial of SPR720, which completed enrollment in the second quarter of 2024.

Direct costs related to our tebipenem HBr program decreased by $7.6 million during the three months ended June 30, 2025, compared to the three months ended June 30, 2024, due to a decrease in clinical activities related to our pivotal Phase 3 PIVOT-PO trial, which met its primary endpoint and was stopped early for efficacy during the first half of 2025.

Direct costs related to our SPR720 program decreased by $4.5 million during the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, due to decreased clinical activity during the period related to our Phase 2a clinical trial of SPR720, which completed enrollment in the second quarter of 2024.

Subsequently, in October 2024, we announced that we would suspend current development activities for SPR720 based on an interim analysis of the Phase 2a proof-of-concept study of SPR720 for the treatment of NTM-PD not meeting its primary endpoint.

Direct costs related to our SPR206 program decreased by $0.2 million during the three months ended March 31, 2025, primarily due to decreased preclinical activity.

Direct costs related to our SPR206 program decreased by $0.1 million during the three months ended June 30, 2025, primarily due to decreased preclinical activity.

In March 2025, following a reprioritization of our programs, we announced that we are no longer pursuing a planned Phase 2 clinical trial for SPR206.

The decrease in personnel-related costs of $0.8 million was primarily a result of increased retention program costs in our research and development functions offset by reduced headcount costs as a result of the previously announced restructuring in the fourth quarter of 2024.

Personnel-related costs for the three months ended March 31, 2025 and 2024 included share-based compensation expense of $0.5 million and $0.7 million, respectively.

Personnel-related costs for the three months ended June 30, 2025 and 2024 included stock-based compensation expense of $0.4 million and $0.7 million, respectively.

Facility-related and other costs primarily reflect costs related to supporting our research and development staff.

General and Administrative Expenses

Three Months Ended March 31,

Personnel related (including share-based compensation)

Three Months Ended June 30,

Personnel related (including stock-based compensation)

Professional and consultant fees

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The increase in personnel-related costs of $0.2 million was primarily a result of retention program costs in our general and administrative functions during the period, offsetting reduced headcount costs as a result of the previously announced restructuring in the fourth quarter of 2024.

Personnel-related costs for the three months ended March 31, 2025 and 2024 included share-based compensation expense of $1.0 million and $1.3 million, respectively.

The increase in professional and consultant fees of $0.2 million was primarily due to varying legal and consulting expenses incurred in the three months ended March 31, 2025.

Personnel-related costs for the three months ended June 30, 2025 and 2024 included stock-based compensation expense of $0.3 million and $1.4 million, respectively.

The increase in professional and consultant fees of $0.2 million was primarily due to an increase in legal and consulting expenses incurred in the three months ended June 30, 2025.

Facility-related and other costs primarily reflect costs related to supporting our general and administrative staff.

Other Income (Expense), Net

Other income (expense), net was $0.9 million for the three months ended March 31, 2025, compared to $1.3 million for the three months ended March 31, 2024.

Total other income for the three months ended March 31, 2025, included $0.9 million of interest income, of which $0.4 million related to the significant financing component recognized under the GSK License Agreement, offset by immaterial fluctuations in unrealized foreign currency.

Total other income for the three months ended March 31, 2024, included $1.3

Other income (expense), net was $0.7 million for the three months ended June 30, 2025, compared to $1.2 million for the three months ended June 30, 2024.

Total other income for the three months ended June 30, 2025, included $0.7 million of interest income, of which $0.4 million related to the significant financing component recognized under the GSK License Agreement, offset by immaterial fluctuations in unrealized foreign currency.

Total other income for the three months ended June 30, 2024, included $1.2

million of interest income, of which $0.4 million related to the significant financing component recognized under the GSK License Agreement, offset by immaterial fluctuations in unrealized foreign currency.

Comparison of the Six Months Ended June 30, 2025 and 2024

The following table summarizes our results of operations for the six months ended June 30, 2025 and 2024 (in thousands):

Six Months Ended June 30,

Grant revenue

Collaboration revenue - related party

Collaboration revenue

Total revenues

Operating expenses:

Research and development

General and administrative

Restructuring

Total operating expenses

Loss from operations

Other income (expense):

Interest income

Other income (expense), net

Total other income, net

Grant Revenue

Six Months Ended June 30,

BARDA Contract (Tebipenem HBr)

NIAID Contract (SPR206)

Total grant revenue

Grant revenue recognized during the six months ended June 30, 2025 and 2024 consisted of the reimbursement of qualifying expenses incurred in connection with our various government awards.

The decrease in grant revenue during the six months ended June 30, 2025 was primarily due to a decrease of $5.9 million under our BARDA contract for tebipenem HBr, and a decrease of $0.2 million under our NIAID agreement relating to SPR206.

Collaboration Revenue

Six Months Ended June 30,

GSK (Tebipenem HBr)

Pfizer (SPR206)

Total collaboration revenue

During the six months ended June 30, 2025, we recognized $16.9 million in collaboration revenue related to our agreement with GSK and under $0.1 million in collaboration revenue related to our agreement with Pfizer.

During the six months ended June 30, 2024, we recognized $10.0 million in collaboration revenue related to our agreement with GSK and $0.3 million in collaboration revenue related to our agreement with Pfizer.

Research and Development Expenses

Six Months Ended June 30,

Direct research and development expenses by program:

Tebipenem HBr

Unallocated expenses:

Personnel related (including stock-based compensation)

Facility related and other

Total research and development expenses

Direct costs related to our tebipenem HBr program decreased by $6.7 million during the six months ended June 30, 2025, compared to the six months ended June 30, 2024, due to a decrease in clinical activities related to our pivotal Phase 3 PIVOT-PO trial which met its primary endpoint and was stopped early for efficacy during the first half of 2025.

Direct costs related to our SPR720 program decreased by $8.4 million during the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, due to decreased clinical activity during the period related to our Phase 2a clinical trial of SPR720, which completed enrollment in the second quarter of 2024.

Direct costs related to our SPR206 program decreased by $0.3 million during the six months ended June 30, 2025, primarily due to decreased preclinical activity.

In March 2025, following a reprioritization of our programs, we announced that we are no longer pursuing a planned Phase 2 clinical trial for SPR206.

The decrease in personnel-related costs of $1.0 million was primarily a result of increased retention program costs in our research and development functions offset by reduced headcount costs as a result of the previously announced restructuring in the fourth quarter of 2024.

Personnel-related costs for the six months ended June 30, 2025 and 2024 included stock-based compensation expense of $0.9 million and $1.4 million, respectively.

Facility-related and other costs primarily reflect costs related to supporting our research and development staff.

General and Administrative Expenses

Six Months Ended June 30,

Personnel related (including stock-based compensation)

Professional and consultant fees

Facility related and other

Total general and administrative expenses

The increase in personnel-related costs of $1.0 million was primarily a result of retention bonus and executive severance expense in our general and administrative functions during the period offsetting reduced headcount costs as a result of the previously announced restructuring in the fourth quarter of 2024.

Personnel-related costs for the six months ended June 30, 2025 and 2024 included stock-based compensation expense of $1.3 million and $2.7 million, respectively.

The increase in professional and consultant fees of $0.4 million was primarily due to an increase in legal and consulting expenses incurred in the six months ended June 30, 2025.

Facility-related and other costs primarily reflect costs related to supporting our general and administrative staff.

Other Income (Expense), Net

Total other income (expense), net was $1.6 million for the six months ended June 30, 2025, compared to $2.5 million for the six months ended June 30, 2024.

Total other income for the six months ended June 30, 2025, included $1.6 million of interest income, of which $0.7 million related to the significant financing component recognized under the GSK License Agreement, offset by immaterial fluctuations in unrealized foreign currency.

Total other income for the six months ended June 30, 2024, included $1.7 million of

interest income, of which $0.8 million related to the significant financing component recognized under the GSK License Agreement, offset by immaterial fluctuations in unrealized foreign currency.

Liquidity and Capital Resources

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To date, we have funded our operations with payments received under license and collaboration agreements and funding from government contracts, and from the proceeds of multiple common stock offerings.

As of March 31, 2025, we had cash and cash equivalents of $48.9 million.

We filed a universal shelf registration statement on Form S-3 with the SEC on March 15, 2024 (the “2024 Form S-3”), which became effective on March 22, 2024, and pursuant to which we registered for sale up to $300.0 million of any combination of our common stock, preferred stock, debt securities, warrants, rights and/or units from time to time and at prices and on terms that we may determine, including up to $75.0 million of our common stock available for issuance pursuant to a Controlled Equity Offering Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co.

Under the Sales Agreement, Cantor may sell shares of our common stock by any method permitted by law deemed to be an “at-the-market” offering as defined in Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), subject to the terms of the Sales Agreement.

During the three months ended March 31, 2025, we did not sell any shares of our common stock under the Sales Agreement.

The following table summarizes our sources and uses of cash for the three months ended March 31, 2025 and 2024:

Three Months Ended March 31,

As of June 30, 2025, we had cash and cash equivalents of $31.2 million.

In the third quarter of 2025, we received the final payment under the GSK License Agreement of $23.8 million.

We filed the 2024 Form S-3 on March 15, 2024, which became effective on March 22, 2024, and pursuant to which we registered for sale up to $300.0 million of any combination of our common stock, preferred stock, debt securities, warrants, rights and/or units from time to time and at prices and on terms that we may determine, including up to $75.0 million of our common stock available for issuance pursuant to the Sales Agreement with Cantor.

During the three and six months ended June 30, 2025, we did not sell any shares of our common stock under the Sales Agreement.

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

Six Months Ended June 30,

Cash used in operating activities

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Operating Activities

Net cash used in operating activities for the three months ended March 31, 2025, was $4.0 million, primarily resulting from our net loss of $13.9 million, adjusted for non-cash items of $1.8 million (primarily stock-based compensation).

Net cash provided by changes in our operating assets and liabilities was $8.0 million and consisted primarily of a $25.8 million decrease in our related party collaboration receivable, primarily due to the receipt of the third installment payment from GSK (see Note 10 - License, Collaboration and Service Agreements), a $5.1 million decrease in deferred revenue, a $9.5 million decrease in accrued expenses, a $5.5 million decrease in accounts payable, a $0.4 million decrease in prepaid expenses and a $2.4 million net decrease in other receivables.

Net cash provided by changes in operating activities for the three months ended March 31, 2024, was $5.9 million, primarily resulting from our net loss of $12.7 million, adjusted for a net decrease in non-cash items of $2.3 million (primarily stock-based compensation).

Net cash provided by changes in our operating assets and liabilities was $16.3 million and consisted primarily of a $23.3 million decrease in our related party collaboration receivable, due to the receipt of the first installment payment from GSK (see Note 10 - License, Collaboration and Service Agreements), a $4.2 million increase in deferred revenue, a $3.5 million net increase in receivables, a $1.7 million increase in accounts payable and a decrease of $1.2 million in accrued expenses.

Net cash used in operating activities for the six months ended June 30, 2025, was $21.7 million, primarily resulting from our net loss of $15.6 million, adjusted for an increase to non-cash items of $2.8 million (primarily stock-based compensation).

Net cash used by changes in our operating assets and liabilities was $9.0 million and consisted primarily of a $24.9 million decrease in the collaboration receivable-related party, due to the receipt of the third installment payment from GSK (see Note 10), a $16.9 million decrease in deferred revenue, a $11.0 million decrease in accrued expenses, a $6.5 million decrease in accounts payable, a $0.6 million increase in prepaid expenses, a $0.6 million net increase in other receivables, and a $0.7 million decrease in operating lease liability.

Net cash used in operating activities for the six months ended June 30, 2024, was $12.8 million, primarily resulting from our net loss of $30.5 million, adjusted for an increase to non-cash items of $4.7 million (primarily stock-based compensation).

Net cash provided by changes in our operating assets and liabilities was $13.1 million and consisted primarily of a $21.4 million decrease in our related party collaboration receivable, due to the receipt of the first installment payment from GSK (see Note 10), a $10.2 million decrease in deferred revenue, a $3.2 million net decrease in receivables, a $1.3 million increase in accounts payable, an increase of $3.5 million in accrued expenses, and a $0.6 million decrease in operating lease liability.

Changes in accounts payable, accrued expenses and other current liabilities and prepaid expenses and other current assets in all periods were generally due to the advancement of our programs and the timing of vendor invoicing and payments.

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Investing Activities

We did not undertake any investing activities during the three months ended March 31, 2025 or 2024.

We did not undertake any investing activities during the six months ended June 30, 2025 or 2024.

Financing Activities

We did not undertake any financing activities during the three months ended March 31, 2025 or 2024.

We did not undertake any financing activities during the six months ended June 30, 2025 or 2024.

Funding Requirements

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• costs associated with litigation and any government investigation.

As of March 31, 2025, we had cash and cash equivalents of $48.9 million.

In accordance with Accounting Standards Update (“ASU”) 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40), we are required to evaluate whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern from the issuance date of our financial statements.

Based on the Company’s current operating plan and existing cash and cash equivalents, the Company has determined that there is substantial doubt regarding its ability to continue as a going concern within one year after the date that these consolidated financial statements are issued.

Based on our cash and cash equivalents as of March 31, 2025, together with earned and non-contingent development milestone payments from GSK, we believe that our cash runway will be sufficient to fund our operating expenses and capital expenditure requirements into the second quarter of 2026.

As of June 30, 2025, we had cash and cash equivalents of $31.2 million.

In accordance with ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40), we are required to evaluate whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern from the issuance date of our financial statements.

Based on such cash and cash equivalents as of June 30, 2025, together with earned and non-contingent development milestone payments from GSK, including the final payment under the GSK License Agreement of $23.8 million received in the third quarter of 2025, and the decrease in clinical expense as a result of the PIVOT-PO Phase 3 trial for tebipenem HBr stopping early for efficacy following positive interim analysis results, we believe that our cash runway will enable us to fund our operating expenses and capital expenditure requirements for at least 12 months from the issuance of the financial statements included in this report and into 2028.

This timeline is subject to uncertainty as to the timing of future expenditures.

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In that event, we may have to delay, scale back, or eliminate some or all of our planned clinical trials, and research stage programs.

As a result, management has concluded that substantial doubt exists about our ability to continue as a going concern.

The actions necessary to reduce spending under this plan at a level that mitigates the factors described above are not considered probable, as defined in the accounting standards and therefore, the full extent to which management may extend our funds through these actions may not be considered in management’s assessment of our ability to continue as a going concern.

We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect.

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Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures or declaring dividends.

If we raise additional funds through collaborations, strategic alliances or

marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us.

If our access to capital is restricted or associated borrowing costs increase as a result of developments in financial markets, our operations and financial condition could be adversely impacted.

If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us.

If our access to capital is restricted or associated borrowing costs increase as a result of developments in financial markets, our operations

and financial condition could be adversely impacted.

If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, limit, reduce or terminate our research, product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

On February 25, 2025, we received a deficiency letter from the Listing Qualifications Department informing us that we were not in compliance with the continued listing requirements of the Nasdaq GS because the bid price for our common stock had closed below $1.00 per share for 30 consecutive business days.

We have until August 25, 2025, to regain compliance with the bid price requirement.

If we do not regain compliance with the bid price requirement, our common stock will be subject to delisting.

Contractual Obligations and Commitments

During the three months ended March 31, 2025, there have been no material changes to our contractual obligations and commitments outside the ordinary course of business from those described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Contractual Obligations and Commitments” in our Annual Report on Form 10-K for the year ended December 31, 2024.

During the three and six months ended June 30, 2025, there have been no material changes to our contractual obligations and commitments from those described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Contractual Obligations and Commitments” in our Annual Report on Form 10-K for the year ended December 31, 2024.

Off-Balance Sheet Arrangements

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Quantitative and Qualitati ve Disclosures About Market Risk.

As of March 31, 2025, we had cash and cash equivalents of $48.9 million, consisting of cash and money market accounts.

As of June 30, 2025, we had cash and cash equivalents of $31.2 million, consisting of cash and money market accounts.

The primary objectives of our investment activities are to preserve principal, provide liquidity and maximize income without significantly increasing risk.

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Treasury interest rates.

We did not have any assets classified as marketable securities as of March 31, 2025.

We did not have any assets classified as marketable securities as of June 30, 2025.

As we incur research expenses in foreign countries, we face exposure to movements in foreign currency exchange rates, primarily the Euro, British Pound and Australian dollar against the U.S.

Historically, foreign currency fluctuations have not had a material impact on our consolidated financial statements.

Please note, that we are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and are not required to provide the information under this item.

Please note, that we are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

Therefore, the above disclosure is discretionary.

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-Q

Item 2. Management’s Discussion and Analysis