What changed in this filing

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Item 1. Financial Statements

2024-11-13 compared with 2024-08-14 · 478 added, 478 removed, 928 unchanged (51% of the section changed)

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(In thousands, except for share and per share

September 30,

Current assets:

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Property, plant and equipment, net

Liabilities, mezzanine equity, and stockholders’ deficit

Liabilities and stockholders’ (deficit) equity

Current liabilities:

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Accrued liabilities

Dividends payable

Warrant liability

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Commitments and contingencies (Note 8)

Mezzanine equity:

Series B-1 preferred stock, $ 0.001 par value per share – zero shares authorized at December 31, 2023, and 50,000 shares authorized at June 30, 2024;

zero shares outstanding at December 31, 2023, and 50,000 shares outstanding at June 30, 2024

Stockholders’ deficit:

Series A-2 preferred stock, $ 0.001 par value per share – 43,649

Series A-2 shares authorized at December 31, 2023 and 21,388.01 Series A-2 Prime shares authorized at June 30, 2024;

43,649 Series A-2

shares outstanding at December 31, 2023 and 17,073.07 Series A-2 Prime shares outstanding at June 30, 2024

Stockholders’ (deficit) equity:

Series A-2 Prime preferred stock, $ 0.001 par value per share – 43,649 Series A-2 shares authorized at December 31, 2023 and 21,388.01 Series A-2 Prime shares authorized at September 30, 2024;

43,649 Series A-2 shares outstanding at December 31, 2023 and 11,111.24 Series A-2 Prime shares outstanding at September 30, 2024

Series B-2 preferred stock, $ 0.001 par value per share – zero Series B-2 shares authorized at December 31, 2023 and 7,882 Series B-2 Prime shares authorized at September 30, 2024;

zero Series B-2 shares outstanding at December 31, 2023 and 7,882 Series B-2 shares outstanding at September 30, 2024

Preferred stock:

$ 0.001 par value per share— 9,926,161 and 9,904,773 shares authorized at December 31, 2023 and June 30, 2024, respectively;

zero shares issued and outstanding at December 31, 2023 and June 30, 2024

Common stock, $ 0.001 par value per share – 200,000,000 shares authorized at December 31, 2023 and 400,000,000 shares authorized at June 30, 2024;

34,756,049 and 43,573,212 shares issued and outstanding at December 31, 2023 and June 30, 2024, respectively

$ 0.001 par value per share— 10,000,000 shares authorized at December 31, 2023 and September 30, 2024;

zero shares issued and outstanding at December 31, 2023 and September 30, 2024

Common stock, $ 0.001 par value per share – 200,000,000 shares authorized at December 31, 2023 and 400,000,000 shares authorized at September 30, 2024;

34,756,049 and 97,858,406 shares issued and outstanding at December 31, 2023 and September 30, 2024, respectively

Additional paid-in capital

Accumulated deficit

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total stockholders’ (deficit) equity

Total liabilities and stockholders’ (deficit) equity

See accompanying notes to the financial statements

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Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Licensing revenues

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Total other income (expenses)

Net income (loss)

Deemed dividend to Series A-1 preferred stockholders

Dividend to Series B-1 preferred stockholders

Net income attributable to participating securities

Net income (loss) attributable to common stockholders

Net income (loss) per share attributable to common stockholders, basic

Net loss per share attributable to common stockholders, diluted

Weighted-average shares outstanding used in computing net income (loss) per share, basic

Weighted-average shares outstanding used in computing net loss per

share, diluted

Deemed dividends to Series A-1 preferred stockholders

Cash dividends to Series B-1 preferred stockholders

Net loss attributable to common stockholders

Net loss per share attributable to common stockholders, basic and diluted

Weighted-average shares outstanding used in computing net loss per share, basic and diluted

See accompanying notes to the financial statements

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Preferred Stock

Stockholders’

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Balance at June 30, 2023

Series A-2 Prime

Deemed dividends on Series A-1 preferred stock

Issuance of Series A-2 preferred stock and common stock upon conversion of Series A-1 preferred stock

Issuance of common stock from exercise of options

Stock-based compensation expense

Balance at September 30, 2023

Preferred Stock

Series A-2 Prime

Preferred Stock

Balance at December 31, 2023

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Balance at June 30, 2024

Issuance of Series B-2 preferred stock and common stock upon conversion of Series B-1 preferred stock

Issuance of common stock for exercise of options

Stock-based compensation expense

Balance at September 30, 2024

See accompanying notes to the financial statements

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(In thousands)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities

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Fair value of warrants issued in connection with the issuance of preferred stock

Issuance of Series A-2 preferred stock and common stock upon conversion

of Series A-1 preferred stock

Issuance of Series B-2 preferred stock and common stock upon conversion

of Series B-1 preferred stock

Deferred insurance charges included in prepaid expenses and other current assets

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of drug candidates for in-licensing.

The Company in-licensed the drug candidate UNI

494 from Sphaera Pharma Pte.

Ltd, a Singapore-based corporation, (“Sphaera”) (Note 3).

UNI 494 is a pro-drug of Nicorandill

that is being developed as a treatment for acute kidney injury.

In September 2018, the Company purchased a second

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Kidney Disease (“CKD”).

In 2017, the Company in-licensed the drug candidate UNI 494 from Sphaera

Ltd, a Singapore-based corporation, (“Sphaera”) (Note 3).

UNI 494 is a pro-drug of nicorandil that is being developed

as a treatment for acute kidney injury.

The Company continues to evaluate the licensing

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revenue as well as product sales.

The Company has not generated any licensing revenue during the six months ended June 30, 2024.

The Company has incurred operating losses and negative cash flows from

operations since inception and expects to continue to incur negative cash flows from operations in the future.

As the Company increases

its research and development activities, the operating losses are expected to increase.

The Company has historically relied on private

equity offerings, debt financing and loans from a stockholder to fund its operations.

As of December 31, 2023 and June 30, 2024, the Company

had an accumulated deficit of $ 64.5 million and $ 75.6 million, respectively.

The Company has not generated any licensing revenue during the nine months ended September 30, 2024.

The Company has incurred operating losses and

negative cash flows from operations since inception and expects to continue to incur negative cash flows from operations in the future.

As the Company increases its research and development activities, the operating losses are expected to increase.

The Company has historically

relied on private equity offerings, debt financing and loans from a stockholder to fund its operations.

As of December 31, 2023 and September

30, 2024, the Company had an accumulated deficit of $ 64.5 million and $ 79.7 million, respectively.

In connection with its initial public offering

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other commercial planning.

On March 3, 2023, the Company entered into a securities

purchase agreement with certain healthcare-focused institutional investors that may provide up to $ 130.0 million in gross proceeds through

a private placement and that included initial upfront funding of $ 28.0 million in net proceeds.

On March 13, 2024, the Company entered into a securities purchase agreement

with certain healthcare-focused institutional investors to provide $ 50 million in gross proceeds through a private placement.

to the securities purchase agreement, the Company issued institutional investors $ 50 million in shares of Series B Convertible Preferred

On March 3, 2023, the Company entered into a

securities purchase agreement with certain healthcare-focused institutional investors that may provide up to $ 130.0 million in gross

proceeds through a private placement and that included initial upfront funding of $ 28.0 million in net proceeds.

On March 13, 2024, the Company entered into a

securities purchase agreement with certain healthcare-focused institutional investors to provide $ 50.0 million in gross proceeds through

a private placement.

Pursuant to the securities purchase agreement, the Company issued institutional investors $ 50.0 million in shares

of Series B Convertible Preferred Stock.

The Company received $ 46.2 million in net proceeds (net of issuance costs).

The Company expects to continue incurring losses

in the future and will be required to raise additional capital in the future to complete its planned clinical trials, pursue product development

initiatives and penetrate markets for the sale of its products.

Management believes that the Company will continue to have access to capital

resources through possible equity offerings, debt financings, corporate collaborations or other means.

There can be no assurance that

the Company will be able to obtain additional financing on terms acceptable to the Company, on a timely basis or at all.

If the Company

is unable to secure additional capital, it may be required to curtail any clinical trials and development of new or existing products

and take additional measures to reduce expenses in order to conserve its cash in amounts sufficient to sustain operations and meet its

Based on the Company’s current level of expenditures, the Company believes that it has sufficient resources such that

there is not substantial doubt about the ability to continue operations for at least one year after the date that these financial statements

are available to be issued.

in the future and will be required to raise additional capital in the future to complete its planned clinical trials, pursue product

development initiatives and penetrate markets for the sale of its products.

Management believes that the Company will continue to have

access to capital resources through possible equity offerings, debt financings, corporate collaborations or other means.

no assurance that the Company will be able to obtain additional financing on terms acceptable to the Company, on a timely basis or at

If the Company is unable to secure additional capital, it may be required to curtail any clinical trials and development of new

or existing products and take additional measures to reduce expenses in order to conserve its cash in amounts sufficient to sustain operations

and meet its obligations.

Based on the Company’s current level of expenditures, the Company believes that it has sufficient resources

such that there is not substantial doubt about the ability to continue operations for at least one year after the date that these financial

statements are available to be issued.

Summary of Significant Accounting Policies

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The accompanying unaudited financial statements

of the Company as of June 30, 2024 have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X

and, accordingly, they do not include all information and footnote disclosures required by accounting principles generally accepted in

of the Company as of September 30, 2024 have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation

S-X and, accordingly, they do not include all information and footnote disclosures required by accounting principles generally accepted

The Company believes the footnotes and other disclosures made in the financial statements are adequate

for a fair presentation of the results of the interim periods presented.

The financial statements include all adjustments (solely of a

normal recurring nature) which are, in the opinion of management, necessary to make the information presented not misleading.

The financial statements include all adjustments (solely of

a normal recurring nature) which are, in the opinion of management, necessary to make the information presented not misleading.

read these financial statements and the accompanying notes in conjunction with the financial statements and notes thereto included in

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could have a material effect on future results of operations and financial position.

Significant items subject to such estimates and assumptions

include revenues, stock-based compensation, research contract progress estimates, and the fair value of warrant liabilities.

Actual results

may materially differ from those estimates.

Significant items subject to such estimates and

assumptions include revenues, stock-based compensation, research contract progress estimates, and the fair value of warrant liabilities.

Actual results may materially differ from those estimates.

Revenue Recognition

The Company recognizes revenue in accordance with

Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”).

The Company recognizes revenue in accordance

with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”).

applies the five-step model in ASC 606 and recognizes revenue from product sales or services rendered when control of the promised goods

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To achieve this core principle, the Company applies the following five steps:

identify the contract

with the client, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price

to performance obligations in the contract and recognize revenues when or as the Company satisfies a performance obligation.

contract with the client, identify the performance obligations in the contract, determine the transaction price, allocate the transaction

price to performance obligations in the contract and recognize revenues when or as the Company satisfies a performance obligation.

Warrant Liability

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as one reportable operating segment.

The Company’s Chief Executive Officer, who is the chief operating decision maker, reviews financial

information on an aggregate basis for purposes of allocating resources and evaluating financial performance.

The Company’s Chief Executive Officer, who is the chief operating decision maker, reviews

financial information on an aggregate basis for purposes of allocating resources and evaluating financial performance.

Risks and Uncertainties

The Company operates in a dynamic and highly competitive

industry and believes that changes in any of the following areas could have a material adverse effect on the Company’s future financial

position, results of operations, or cash flows:

The Company operates in a dynamic and highly

competitive industry and believes that changes in any of the following areas could have a material adverse effect on the Company’s

future financial position, results of operations, or cash flows:

ability to obtain future financing;

advances and trends in new technologies and industry

advances and trends in new technologies

and industry standards;

results of clinical trials;

regulatory approval and market acceptance of the Company’s products;

development of sales

of sales channels;

certain strategic relationships;

litigation or claims against the Company related to intellectual property, product, regulatory,

or other matters;

litigation or claims against the Company related to intellectual property, product,

regulatory, or other matters;

and the Company’s ability to attract and retain employees necessary to support its growth.

The Company’s general business strategy

may be adversely affected by any such economic downturns (including the current downturn related to the COVID-19 pandemic), volatile

business environments and continued unstable or unpredictable economic and market conditions.

may be adversely affected by any such economic downturns, volatile business environments and continued unstable or unpredictable economic

and market conditions.

Any product candidates developed by the Company

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the Company’s current product candidates or any future product candidates will receive the necessary approvals.

If the Company is

denied approval, approval is delayed or the Company is unable to maintain approval, it could have a materially adverse impact on the Company.

If the Company

is denied approval, approval is delayed or the Company is unable to maintain approval, it could have a materially adverse impact on the

The Company has expended and will continue to

expend substantial funds to complete the research, development and clinical testing of its product candidates.

The Company also will be

required to expend additional funds to establish commercial-scale manufacturing arrangements and to provide for the marketing and distribution

of products that receive regulatory approval.

The Company also will

be required to expend additional funds to establish commercial-scale manufacturing arrangements and to provide for the marketing and

distribution of products that receive regulatory approval.

The Company will require additional funds to commercialize its products.

The Company is

unable to entirely fund these efforts with its current financial resources.

If adequate funds are unavailable on a timely basis from operations

or additional sources of financing, the Company may have to delay, reduce the scope of or eliminate one or more of its research or development

programs, which would materially and adversely affect its business, financial condition and operations.

Company is unable to entirely fund these efforts with its current financial resources.

If adequate funds are unavailable on a timely

basis from operations or additional sources of financing, the Company may have to delay, reduce the scope of or eliminate one or more

of its research or development programs, which would materially and adversely affect its business, financial condition and operations.

The Company is dependent upon the services of

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cost less accumulated depreciation.

Additions, improvements, and major renewals or replacements that substantially extend the useful life

of an asset are capitalized.

Additions, improvements, and major renewals or replacements that substantially extend the useful

life of an asset are capitalized.

Repairs and maintenance expenditures are expensed as incurred.

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fair value at that time.

At June 30, 2024, management determined there were no impairments of the Company’s property and equipment.

At September 30, 2024, management determined there were no impairments of the Company’s property and equipment.

The Company determines whether a contract is,

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hierarchy contains the following levels:

● Level 1 — defined as

observable inputs based on unadjusted quoted prices for identical instruments in active markets;

● Level 2 — defined as

inputs other than Level 1 that are either directly or indirectly observable in the marketplace for identical or similar instruments in

markets that are not active;

● Level 3 — defined as

unobservable inputs in which little or no market data exists where valuations are derived from techniques in which one or more significant

inputs are unobservable.

Level 1 — defined as observable inputs based on unadjusted quoted

prices for identical instruments in active markets;

Level 2 — defined as inputs other than Level 1 that are either

directly or indirectly observable in the marketplace for identical or similar instruments in markets that are not active;

Level 3 — defined as unobservable inputs in which little or no

market data exists where valuations are derived from techniques in which one or more significant inputs are unobservable.

The following table summarizes the fair value hierarchy of financial

liabilities measured at fair value as of June 30, 2024 (in thousands):

liabilities measured at fair value as of September 30, 2024 (in thousands):

Warrant liability

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are attributable to unobservable inputs (in thousands):

Six Months Ended

Nine months Ended

September 30,

Fair value at January 1, 2023

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Fair value at June 30, 2023

Change in fair value of warrants

Fair value at September 30, 2023

Fair value at January 1, 2024

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Fair value at June 30, 2024

Change in fair value of warrants

Fair value at September 30, 2024

The expense relating to the change in fair value

of the warrant liability of $ 0.3 million and $ 16.8 million for the three months ended June 30, 2023 and June 30, 2024 respectively is

included in other income (expense) in the statements of operations.

of the warrant liability of $ 8.7 million and $ 6.8 million for the nine months ended September 30, 2023 and September 30, 2024, respectively,

is included in other income (expense) in the statements of operations.

ASC 820, Fair Value Measurement and Disclosures

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to estimate fair value.

As of December 31, 2023 and June 30, 2024, the recorded values of cash and cash equivalents, accounts payable,

As of December 31, 2023 and September 30, 2024, the recorded values of cash and cash equivalents, accounts payable,

and accrued liabilities approximated fair value due to the short-term nature of the instruments.

Cash and cash equivalents, accounts payable,

and accrued liabilities are Level 1 financial instruments.

Cash and cash equivalents, accounts

payable, and accrued liabilities are Level 1 financial instruments.

Concentration of Credit Risk

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to other adverse conditions in the financial or credit markets.

No such losses have been incurred through June 30, 2024.

No such losses have been incurred through September 30, 2024.

Prepaid Expenses and Other Current Assets

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The Company estimates the fair value of stock options using the Black-Scholes option-pricing model.

The Black-Scholes model

requires the input of subjective assumptions, including expected common stock volatility, expected dividend yield, expected term, risk-free

interest rate, and the estimated fair value (prior to the Company’s initial public offering) or the public market closing price

of the Company’s underlying common stock on the date of grant.

The Black-Scholes

model requires the input of subjective assumptions, including expected common stock volatility, expected dividend yield, expected term,

risk-free interest rate, and the estimated fair value (prior to the Company’s initial public offering) or the public market closing

price of the Company’s underlying common stock on the date of grant.

The Company accounts for corporate income taxes

in accordance with GAAP as stipulated in ASC, Topic 740, Income Taxes, (“ASC 740”).

This standard entails the use of the asset

and liability method of computing the provision for income tax expense.

Current tax expense results from corporate tax payable at the

Federal and California jurisdictions for the Company, which relates to the current accounting period.

Deferred tax expense results primarily

from temporary differences between financial statement and tax return reporting, which result in additional tax payable in future periods.

Deferred tax assets and liabilities are determined based on the differences between the financial statement basis and tax basis of assets

and liabilities using enacted tax rates and law.

Net future tax benefits are subject to a valuation allowance when management expects

that it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

This standard entails the use of the

asset and liability method of computing the provision for income tax expense.

Current tax expense results from corporate tax payable

at the Federal and California jurisdictions for the Company, which relates to the current accounting period.

Deferred tax expense results

primarily from temporary differences between financial statement and tax return reporting, which result in additional tax payable in

future periods.

Deferred tax assets and liabilities are determined based on the differences between the financial statement basis and

tax basis of assets and liabilities using enacted tax rates and law.

Net future tax benefits are subject to a valuation allowance when

management expects that it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

Current and non-current tax assets and liabilities

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interest or penalties related to income tax matters in income tax expense.

The Tax Cuts and Jobs Act of 2017 eliminated the

option to immediately deduct research and development expenditures in the year incurred under Section 174, which became effective January

We are monitoring legislation for any further changes to Section 174 and the impact, if any, to the financial statements in 2024.

The Tax Cuts and Jobs Act of 2017 eliminated

the option to immediately deduct research and development expenditures in the year incurred under Section 174, which became effective

January 1, 2022.

We are monitoring legislation for any further changes to Section 174 and the impact, if any, to the financial statements

Comprehensive Loss

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Basic and diluted net income (loss)

for common stock and for preferred stock is computed by dividing the sum of distributed earnings and undistributed earnings for each class

of stock by the weighted average number of shares outstanding for each class of stock for the period.

Diluted net income (loss) per share

includes potentially dilutive securities outstanding for the period.

See Note 14 for reconciliations of basic and diluted net income (loss)

for common stock and for preferred stock is computed by dividing the sum of distributed earnings and undistributed earnings for each

class of stock by the weighted average number of shares outstanding for each class of stock for the period.

Diluted net income (loss)

per share includes potentially dilutive securities outstanding for the period.

See Note 14 for reconciliations of basic and diluted net

income (loss) per share.

Recent Accounting Pronouncements

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not expected to have a material impact on the Company’s financial position or results of operations upon adoption.

In November 2023, the Financial Accounting Standards Board (“FASB”)

issued Accounting Standard Update (“ASU”) No.

In November 2023, the Financial Accounting Standards

Board (“FASB”) issued Accounting Standard Update (“ASU”) No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures,

which requires an enhanced disclosure of significant segment expenses on an annual and interim basis.

This guidance is effective for fiscal

years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is

Upon adoption, the guidance should be applied retrospectively to all prior periods presented in the financial statements.

do not expect the adoption of this guidance to have a material impact on our financial statements.

to Reportable Segment Disclosures, which requires an enhanced disclosure of significant segment expenses on an annual and interim basis.

This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after

December 15, 2024.

Early adoption is permitted.

Upon adoption, the guidance should be applied retrospectively to all prior periods presented

in the financial statements.

We do not expect the adoption of this guidance to have a material impact on our financial statements.

The Company adopted Accounting Standards Update

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the entire contractual term from the date of initial recognition of the financial instrument.

As the Company does not currently have any

trade receivables, there was no cumulative effect adjustment, and the adoption of this standard did not have a material impact on the

Company’s financial statements.

As the Company does not currently have

any trade receivables, there was no cumulative effect adjustment, and the adoption of this standard did not have a material impact on

the Company’s financial statements.

Income Taxes Disclosures – In December

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based in India.

P ursuant to the Agreement, Shilpa provides certain development, manufacturing, supply

and other CMC-related services related to the development and commercialization of oxylanthanum carbonate (“OLC”).

In June 2024, the Company entered into the

First Amendment to Manufacturing and Supply Agreement with Shilpa (the “Amendment”).

Company has entered into the Amendment in anticipation of an increased manufacturing demand for OLC.

Pursuant to the Amendment, the

Company has agreed to make a binding purchase order for tablets of OLC and Shilpa has agreed to deliver such order by June 30, 2025.

In addition, the Company has agreed to order additional tablets for delivery between December 31, 2025, and June 30, 2026.

the Company has agreed to make certain milestone payments and to provide certain funding to Shilpa for a new manufacturing line.

initial term of the Agreement shall continue until the eighth (8th) anniversary of the date of receipt by the Company of FDA

approval of its NDA of OLC (the “Initial Term”).

Following the Initial Term, the Agreement shall continue in effect for

consecutive periods of four (4) years each unless earlier terminated pursuant to the terms of the Agreement.

In October 2017, the Company entered into an exclusive

license agreement with Sphaera, a stockholder, for the rights to further develop the drug candidate, UNI 494, for commercialization.

payments were made upon execution of the agreement but payments for $ 50,000 will be due commencing with the initiation by the Company

Pursuant to the Agreement, Shilpa provides certain development, manufacturing, supply and other CMC-related services

related to the development and commercialization of oxylanthanum carbonate (“OLC”).

In June 2024, the Company entered into the First

Amendment to Manufacturing and Supply Agreement with Shilpa (the “Amendment”).

The Company has entered into the Amendment

in anticipation of an increased manufacturing demand for OLC.

Pursuant to the Amendment, the Company has agreed to make a binding purchase

order for tablets of OLC and Shilpa has agreed to deliver such order by September 30, 2025.

In addition, the Company has agreed to order

additional tablets for delivery between December 31, 2025, and September 30, 2026.

Further, the Company has agreed to make certain milestone

payments and to provide certain funding to Shilpa for a new manufacturing line.

The initial term of the Agreement shall continue until

the eighth (8th) anniversary of the date of receipt by the Company of FDA approval of its NDA of OLC (the “Initial Term”).

Following the Initial Term, the Agreement shall continue in effect for consecutive periods of four (4) years each unless earlier terminated

pursuant to the terms of the Agreement.

In October 2017, the Company entered into an

exclusive license agreement with Sphaera, a stockholder, for the rights to further develop the drug candidate, UNI 494, for commercialization.

No payments were made upon execution of the agreement but payments for $ 50,000 will be due commencing with the initiation by the Company

of a second clinical trial and $ 50,000 on completion of such trial.

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Assignment and Asset Purchase Agreement with Spectrum Pharmaceuticals, Inc.

(“Spectrum Agreement”) pursuant to which the Company

purchased certain assets from Spectrum, including Spectrum’s right, title, interest in and intellectual property related to Renazorb

RZB 012, also known as RENALAN™ (“Renalan”) and RZB 014, also known as SPI 014 (“SPI” and together with

Renalan, the “Compounds”), to further develop and commercialize oxylanthanum carbonate and related compounds.

In partial consideration

for the Spectrum Agreement, the Company issued 313,663 shares of common stock to Spectrum valued at approximately $ 4,000 which represented

four percent of the Company on a fully-diluted basis at the date of the execution of the Spectrum Agreement.

The Spectrum Agreement has

an anti-dilution provision, which provides that Spectrum maintain its ownership interest in the Company at 4 % of the Company’s shares

on a fully-diluted basis.

Fully-diluted shares of common stock for purposes of the oxylanthanum carbonate Purchase Agreement assumes conversion

of any security convertible into or exchangeable or exercisable for common stock or any combination thereof, including any common stock

reserved for issuance under a stock option plan, restricted stock plan, or other equity incentive plan approved by the Board of Directors

of the Company immediately following the issuance of additional shares of the Company’s common stock (but prior to the issuance

of any additional shares of common stock to Spectrum).

Spectrum’s ownership shall not be subject to dilution until the earlier of

thirty-six months from the first date the Company’s stock trades on a public market, or the date upon which the Company attains

a public market capitalization of at least $ 50 million.

On July 13, 2021, the Company’s initial public offering resulted in a public

market capitalization of at least $ 50 million, and as a result the Company was required to issue 438,374 anti-dilution shares of common

This issuance represented the final anti-dilution calculation required under the Spectrum Agreement, and no further anti-dilution

shares will be issued.

The Company calculated the fair value of the shares and recognized $ 2.2 million to research and development expenses

as cost to issue those shares during the third quarter of 2021.

In the event an NDA filing for oxylanthanum carbonate is accepted by the

FDA, the Company will be required to pay $ 0.2 million to Altair Nanomaterials, Inc., (“Altair”) in accordance with the Spectrum

In addition, in the event FDA approval for oxylanthanum carbonate is received, the Company will be required to pay $ 4.5 million

The Company is also required to pay Spectrum 40 % of all the Company’s sublicense income for any sublicense granted to

certain sublicensees during the first 12 months after the Closing Date (as that term is defined in the Spectrum Agreement) and 20 % of

all other sublicense income.

The Company’s payment obligations to Spectrum will expire on the twentieth (20th) anniversary of the

Closing Date of the Spectrum Agreement.

In August 2022, the Company received an upfront payment of approximately $ 1.0 million resulting

from a sublicense development agreement with Lee’s Pharmaceutical (HK) Limited.

In February 2023, the Company received an upfront

payment of approximately $ 0.7 million resulting from a sublicense development agreement with Lotus International Pte Ltd.

represents sublicense income as described in the Spectrum Agreement, and 20 % of the amount received has been accrued as an R&D expense

in the accompanying statements of operations for the six months ended June 30, 2023.

(“Spectrum Agreement”) pursuant to which the

Company purchased certain assets from Spectrum, including Spectrum’s right, title, interest in and intellectual property related

to Renazorb RZB 012, also known as RENALAN™ (“Renalan”) and RZB 014, also known as SPI 014 (“SPI” and together

with Renalan, the “Compounds”), to further develop and commercialize oxylanthanum carbonate and related compounds.

consideration for the Spectrum Agreement, the Company issued 313,663 shares of common stock to Spectrum valued at approximately $ 4,000

which represented four percent of the Company on a fully-diluted basis at the date of the execution of the Spectrum Agreement.

Agreement has an anti-dilution provision, which provides that Spectrum maintain its ownership interest in the Company at 4 % of the Company’s

shares on a fully-diluted basis.

Fully-diluted shares of common stock for purposes of the oxylanthanum carbonate Purchase Agreement assumes

conversion of any security convertible into or exchangeable or exercisable for common stock or any combination thereof, including any

common stock reserved for issuance under a stock option plan, restricted stock plan, or other equity incentive plan approved by the Board

of Directors of the Company immediately following the issuance of additional shares of the Company’s common stock (but prior to

the issuance of any additional shares of common stock to Spectrum).

Spectrum’s ownership shall not be subject to dilution until

the earlier of thirty-six months from the first date the Company’s stock trades on a public market, or the date upon which the

Company attains a public market capitalization of at least $ 50 million.

On July 13, 2021, the Company’s initial public offering

resulted in a public market capitalization of at least $ 50 million, and as a result the Company was required to issue 438,374 anti-dilution

shares of common stock.

This issuance represented the final anti-dilution calculation required under the Spectrum Agreement, and no further

anti-dilution shares will be issued.

The Company calculated the fair value of the shares and recognized $ 2.2 million to research and

development expenses as cost to issue those shares during the third quarter of 2021.

In the event an NDA filing for oxylanthanum carbonate

is accepted by the FDA, the Company will be required to pay $ 0.2 million to Altair Nanomaterials, Inc., (“Altair”) in accordance

with the Spectrum Agreement.

In addition, in the event FDA approval for oxylanthanum carbonate is received, the Company will be required

to pay $ 4.5 million to Altair.

The Company is also required to pay Spectrum 40 % of all the Company’s sublicense income for any

sublicense granted to certain sublicensees during the first 12 months after the Closing Date (as that term is defined in the Spectrum

Agreement) and 20 % of all other sublicense income.

The Company’s payment obligations to Spectrum will expire on the twentieth (20th)

anniversary of the Closing Date of the Spectrum Agreement.

In August 2022, the Company received an upfront payment of approximately $ 1.0

million resulting from a sublicense development agreement with Lee’s Pharmaceutical (HK) Limited.

In February 2023, the Company

received an upfront payment of approximately $ 0.7 million resulting from a sublicense development agreement with Lotus International

The payment represents sublicense income as described in the Spectrum Agreement, and 20 % of the amount received has been accrued

as an R&D expense in the accompanying statements of operations for the nine months ended September 30, 2023.

On July 19, 2021, the Company entered into an

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Approximately $ 2.0 million has been paid to Syneos and the research was completed

On January 6, 2022, the Company entered into a

Master Services Agreement with Quotient Sciences Limited (“Quotient”), a UK based company that provides drug development and

analysis services, for the purpose of performing clinical research in support of UNI-494.

The initial budget for the study is approximately

$ 3.7 million, and subsequent revisions reduced the overall budget to $ 2.9 million.

Related payments totaling approximately $ 2.8 million

have been paid to Quotient as of June 30, 2024, approximately $ 2.7 million of related expense has been recorded, and approximately $ 0.6

million and $ 0.8 million has been recorded as prepaid expenses and other current assets in the accompanying balance sheets as of December

31, 2023 and June 30, 2024, respectively.

On January 6, 2022, the Company entered into

a Master Services Agreement with Quotient Sciences Limited (“Quotient”), a UK based company that provides drug development

and analysis services, for the purpose of performing clinical research in support of UNI-494.

The initial budget for the study is

approximately $ 3.7 million, and subsequent revisions reduced the overall budget to $ 2.9 million.

Related payments totaling approximately

$ 2.8 million have been paid to Quotient as of September 30, 2024, approximately 2.8 million of related expense has been recorded, and

approximately $ 0.6 million and $ 0.6 million has been recorded as prepaid expenses and other current assets in the accompanying balance

sheets as of December 31, 2023 and September 30, 2024, respectively.

On February 9, 2022, the Company entered into

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The budget for these services is approximately $ 2.9 million.

Approximately $ 2.9 million has been paid to Inotiv as of June 30, 2024 and

approximately $ 0.3 million and $ 0.1 million has been recorded as prepaid expenses and other current assets in the accompanying balance

sheets as of December 31, 2023 and June 30, 2024, respectively.

On July 14, 2022, the Company entered into a license

agreement with Lee’s Pharmaceutical (HK) Limited (see Note 4).

Under the terms of the agreement, Lee’s Pharmaceutical will

be responsible for development, registration filing and approval for oxylanthanum carbonate in China, Hong Kong, and certain other Asian

In addition, Lee’s Pharmaceutical will have sole responsibility for the importation of the drug product from the Company

and for the costs of commercialization of oxylanthanum carbonate in the licensed territories.

The Company has received an upfront payment

of $ 1.0 million, expects to receive up to $ 1.0 million in milestone payments upon product launch in China and will be eligible for tiered

royalties of between 7 % and 10 % upon achievement of prespecified regulatory and commercial achievements.

Approximately $ 2.9 million has been paid to Inotiv as of September 30, 2024

and approximately $ 0.3 million and $ 0.1 million has been recorded as prepaid expenses and other current assets in the accompanying balance

sheets as of December 31, 2023 and September 30, 2024, respectively.

On July 14, 2022, the Company entered into a

license agreement with Lee’s Pharmaceutical (HK) Limited (see Note 4).

Under the terms of the agreement, Lee’s Pharmaceutical

will be responsible for development, registration filing and approval for oxylanthanum carbonate in China, Hong Kong, and certain other

Asian markets.

In addition, Lee’s Pharmaceutical will have sole responsibility for the importation of the drug product from the

Company and for the costs of commercialization of oxylanthanum carbonate in the licensed territories.

The Company has received an upfront

payment of $ 1.0 million, expects to receive up to $ 1.0 million in milestone payments upon product launch in China and will be eligible

for tiered royalties of between 7 % and 10 % upon achievement of prespecified regulatory and commercial achievements.

On July 27, 2022, the Company entered into an

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The agreements provide

for total payments of up to $ 3.7 million, and the Company has made $ 3.0 million in payments pursuant to the agreements as of June 30,

for total payments of up to $ 3.7 million, and the Company has made $ 3.0 million in payments pursuant to the agreements as of September

Licensing Revenues

On July 14, 2022, the Company entered into a license

agreement (the “Lee’s Agreement”) with Lee’s Pharmaceutical (HK) Limited (“Lee’s”).

terms of the agreement, Lee’s Pharmaceutical will be responsible for development, registration filing and approval for oxylanthanum

carbonate in China, Hong Kong, and certain other Asian markets.

In addition, Lee’s will have sole responsibility for the importation

of the drug product from the Company and for the costs of commercialization of oxylanthanum carbonate in the licensed territories.

parties agreed to enter into a separate manufacturing and supply agreement whereby Unicycive will supply Lee’s with oxylanthanum

carbonate product.

The Company has received an upfront payment of approximately $ 1.0 million, expects to receive up to $ 1.0 million in

milestone payments upon product launch in China and will be eligible for tiered royalties of between 7 % and 10 % upon achievement of prespecified

regulatory and commercial achievements.

On July 14, 2022, the Company entered into a

license agreement (the “Lee’s Agreement”) with Lee’s Pharmaceutical (HK) Limited (“Lee’s”).

Under the terms of the agreement, Lee’s Pharmaceutical will be responsible for development, registration filing and approval for

oxylanthanum carbonate in China, Hong Kong, and certain other Asian markets.

In addition, Lee’s will have sole responsibility for

the importation of the drug product from the Company and for the costs of commercialization of oxylanthanum carbonate in the licensed

Both parties agreed to enter into a separate manufacturing and supply agreement whereby Unicycive will supply Lee’s

with oxylanthanum carbonate product.

The Company has received an upfront payment of approximately $ 1.0 million, expects to receive up

to $ 1.0 million in milestone payments upon product launch in China and will be eligible for tiered royalties of between 7 % and 10 % upon

achievement of prespecified regulatory and commercial achievements.

The Company has evaluated the Lee’s Agreement

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revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.

Variable considerations

consisting of milestone payments and sales-based royalties may be received based on the completion of certain clinical, regulatory, and

commercial activities.

The Company has concluded that the future milestone payments should be excluded from the transaction price due

to the uncertainty of achievement as of December 31, 2023 and June 30, 2024.

The Company will reassess this conclusion at each reporting

date until the uncertainties are resolved.

considerations consisting of milestone payments and sales-based royalties may be received based on the completion of certain clinical,

regulatory, and commercial activities.

The Company has concluded that the future milestone payments should be excluded from the transaction

price due to the uncertainty of achievement as of December 31, 2023 and September 30, 2024.

The Company will reassess this conclusion

at each reporting date until the uncertainties are resolved.

For the sales-based royalty payments, guidance

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The Company has concluded that the future sales-based royalties

should be excluded from the transaction price as of December 31, 2023 and June 30, 2024.

The Company will reassess this conclusion at

each reporting date.

should be excluded from the transaction price as of December 31, 2023 and September 30, 2024.

The Company will reassess this conclusion

at each reporting date.

The Company has concluded that at contract inception

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the functionality of the IP is not expected to substantially change during the license period based on Unicycive’s activities.

revenue should therefore be recognized at a point in time.

The revenue should therefore be recognized at a point in time.

This intellectual property was transferred to Lee’s in July 2022.

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manufacturing and supply agreement whereby Unicycive will supply Lotus with oxylanthanum carbonate product.

The Company has received an

upfront payment of $ 0.7 million, may receive up to $ 3.7 million in future milestone payments and will be eligible for tiered royalties

The Company has received

an upfront payment of $ 0.7 million, may receive up to $ 3.7 million in future milestone payments and will be eligible for tiered royalties

upon achievement of specified commercial achievements.

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biotech companies.

The license portion of the contract as well as the future potential transactions under a manufacturing and supply agreement

both represent a vendor-customer relationship.

The license portion of the contract as well as the future potential transactions under a manufacturing and supply

agreement both represent a vendor-customer relationship.

The Company does not believe that its promise

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combine that good or service with other promised goods or services until it identifies a bundle of goods or services that is distinct.

The combination of the license grant and development services is distinct as Lotus plans to use the product of this bundled unit for developing

its regulatory applications.

The Company concluded that the Lotus agreement contains one performance obligation, the bundle of the license

grant and development services.

The combination of the license grant and development services is distinct as Lotus plans to use the product of this bundled unit for

developing its regulatory applications.

The Company concluded that the Lotus agreement contains one performance obligation, the bundle

of the license grant and development services.

ASC 606 indicates that constrained variable consideration

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revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.

Variable considerations

consisting of milestone payments and sales-based royalties may be received based on the completion of certain clinical, regulatory, and

commercial activities.

The Company has concluded that the future milestone payments should be excluded from the transaction price due

to the uncertainty of achievement as of June 30, 2024.

The Company will reassess this conclusion at each reporting date until the uncertainties

are resolved.

considerations consisting of milestone payments and sales-based royalties may be received based on the completion of certain clinical,

regulatory, and commercial activities.

The Company has concluded that the future milestone payments should be excluded from the transaction

price due to the uncertainty of achievement as of September 30, 2024.

The Company will reassess this conclusion at each reporting date

until the uncertainties are resolved.

For the sales-based royalty payments, guidance

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The Company has concluded that the future sales-based royalties

should be excluded from the transaction price as of December 31, 2023 and June 30, 2024.

The Company will reassess this conclusion at

each reporting date.

should be excluded from the transaction price as of December 31, 2023 and September 30, 2024.

The Company will reassess this conclusion

at each reporting date.

The Company has concluded that at contract inception

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The Company has recognized a total of $ 675,000 in the accompanying statements

of operations as licensing revenue for the six months ended June 30, 2023.

of operations as licensing revenue for the nine months ended September 30, 2023.

Balance Sheet Components

Prepaid expenses and other current assets as of

December 31, 2023 and June 30, 2024 consisted of the following (in thousands):

Prepaid expenses and other current assets as

of December 31, 2023 and September 30, 2024 consisted of the following (in thousands):

September 30,

Prepaid directors’ and officers’ liability insurance premiums

Prepaid preclinical services

Property, plant and equipment as of December 31, 2023 and June 30,

Property, plant and equipment as of December 31, 2023 and September

30, 2024 consisted of the following (in thousands):

September 30,

Leasehold improvements

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Less accumulated depreciation

Accounts payable as of December 31, 2023 and June

30, 2024 consisted of the following (in thousands):

Accounts payable as of December 31, 2023 and

September 30, 2024 consisted of the following (in thousands):

September 30,

Trade accounts payable

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Accrued liabilities as of December 31, 2023 and

June 30, 2024 consisted of the following (in thousands):

September 30, 2024 consisted of the following (in thousands):

September 30,

Accrued labor costs

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borrowing rate of 10 %.

During the six months ended June 30, 2024, the Company reflected amortization of right-of-use asset of approximately

During the nine months ended September 30, 2024, the Company reflected amortization of right-of-use asset of approximately

$ 265,000 , resulting in a right of use asset balance of approximately $ 0.8 million.

During the six months ended June 30, 2024, the

Company made cash payments on the lease of $ 194,000 towards the lease liabilities.

As of June 30, 2024, the total lease liability was

approximately $ 0.6 million.

As of June 30, 2024, maturities of the Company’s

During the nine months ended September 30, 2024,

the Company made cash payments on the lease of $ 329,000 towards the lease liabilities.

As of September 30, 2024, the total lease liability

was approximately $ 0.8 million.

As of September 30, 2024, maturities of the Company’s

lease liabilities are as follows (in thousands, unaudited):

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that arise in the ordinary course of business.

Such matters are inherently uncertain, and there can be no guarantee that the outcome of

any such matter will be decided favorably to the Company or that the resolution of any such matter will not have a material adverse effect

upon the Company’s financial statements.

Such matters are inherently uncertain, and there can be no guarantee that the outcome

of any such matter will be decided favorably to the Company or that the resolution of any such matter will not have a material adverse

effect upon the Company’s financial statements.

The Company currently has no pending claims or legal proceedings.

In December 2022, the Company signed an advisory

services agreement with Maxim Group LLC (“Maxim”) pursuant to which the Company will pay Maxim $ 100,000 upon the closing of

a private placement of the Company’s equity or equity-linked securities.

Maxim provided advisory services with respect to a private

placement securities purchase agreement with certain healthcare-focused institutional investors, which closed in March of 2023.

paid the $ 100,000 advisory fee in March 2023.

services agreement with Maxim Group LLC (“Maxim”) pursuant to which the Company will pay Maxim $ 100,000 upon the closing

of a private placement of the Company’s equity or equity-linked securities.

Maxim provided advisory services with respect to a

private placement securities purchase agreement with certain healthcare-focused institutional investors, which closed in March of 2023.

The Company paid the $ 100,000 advisory fee in March 2023.

Indemnification

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the employee’s eligible compensation.

Company contributions to the 401(k) Plan totaled approximately $ 107,000 and $ 72,000 for the

year ended December 31, 2023 and for the six months ended June 30, 2024, respectively.

Company contributions to the 401(k) Plan totaled approximately $ 107,000 and $ 104,000 for

the year ended December 31, 2023 and for the nine months ended September 30, 2024, respectively.

Stockholders’ Deficit

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Initial Public Offering

During July 2021, as a result of its initial public

offering, the Company issued 5,000,000 shares of common stock and 4,000,000 warrants to investors in exchange for cash at $ 5.00 per unit,

consisting of $ 4.99 per share of common stock and $ .0125 per four fifths of a warrant.

The warrants have a 5 -year term and an exercise

price of $ 6.00 per warrant.

The underwriters exercised their option to purchase an additional 600,000 warrants, and the Company received

$ 7,500 in proceeds.

During July 2021, as a result of its initial

public offering, the Company issued 5,000,000 shares of common stock and 4,000,000 warrants to investors in exchange for cash at $ 5.00

per unit, consisting of $ 4.99 per share of common stock and $ .0125 per four fifths of a warrant.

The warrants have a 5 -year term and

an exercise price of $ 6.00 per warrant.

The underwriters exercised their option to purchase an additional 600,000 warrants, and the Company

received $ 7,500 in proceeds.

As a result of the initial public offering, the

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Additionally,

in accordance with the original terms of the warrant agreements convertible noteholders were granted a total of 184,193 common stock warrants

with a 5 -year term and with an exercise price of $ 6.00 per warrant.

in accordance with the original terms of the warrant agreements convertible noteholders were granted a total of 184,193 common stock

warrants with a 5 -year term and with an exercise price of $ 6.00 per warrant.

The warrants from the initial public offering

are equity classified.

The following table summarizes activity for the Company’s IPO warrants for the six months ended June 30,

The following table summarizes activity for the Company’s IPO warrants for the nine months ended September

Number of Average

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Warrants exercised -

Outstanding, June 30, 2024 4,784,193 6.00 2.04 -

Outstanding, September 30, 2024 4,784,193 6.00 1.79 -

See Note 12 for information on preferred stock

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entitled to one vote for each share thereof held.

Issuance of Series A-1 Preferred Stock

As of December 31, 2022, the Company had 10,000,000

shares of preferred stock authorized, par value of $ 0.001 per share, and no shares of preferred stock were issued or outstanding.

March 31, 2023, as a result of the Company’s private placement financing, there were 30,190 shares of Series A-1 Preferred Stock

issued and outstanding.

Issuance of Series A-1 Preferred

On March 3, 2023, the Company issued and sold,

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deemed dividends) of Series A-4 Preferred Stock (the “Tranche B Warrant”), and (iv) a tranche C warrant to acquire approximately

67,892,276 shares (excluding deemed dividends) of Series A-5 Preferred Stock (the “Tranche C Warrant”, together with the Tranche

A Warrant and the Tranche B Warrant, the “Warrants”).

67,892,276 shares (excluding deemed dividends) of Series A-5 Preferred Stock (the “Tranche C Warrant”, together with the

Tranche A Warrant and the Tranche B Warrant, the “Warrants”).

The Tranche A Warrant, for an aggregate exercise price of approximately

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The Amended Certificate of Designation was filed with an effective date of March 14, 2024.

The following is a summary of terms of the Series

A Preferred Stock under the Amended Series A Certificate of Designation:

At all times following the Issuance

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Issuance of Series B-1 Preferred Stock

On March 13, 2024, the Company entered into a

securities purchase agreement (the “Purchase Agreement”) with certain accredited investors (the “Investors”),

pursuant to which the Company agreed to issue and sell, in a private placement (the “Offering”), 50,000 shares of Series B

Convertible Preferred Stock, par value $ 0.001 per share (the “Series B-1 Preferred Stock”), at a purchase price of $ 1,000

per share with an initial conversion price of $ 1.00 per share, subject to adjustment (the “Conversion Price”), for an aggregate

gross offering price of $ 50 million.

The Company received net proceeds of $ 46.2 million (net of issuance costs).

Pursuant to the Certificate of Designation of

Preferences, Rights and Limitations of the Series B Convertible Preferred Stock (the “Series B Certificate of Designation”),

each share of Series B-1 Preferred Stock is, subject to the Stockholder Approval (as defined below), convertible into shares of common

stock of the Company (the “Common Stock”) and, if applicable, shares of Series B-2 Convertible Preferred Stock of the Company

(“Series B-2 Preferred Stock”) in an amount of shares equal to the Liquidation Preference (as defined below) divided by the

Conversion Price.

Dividends will accrue, on all issued and outstanding

shares of Series B-1 Preferred Stock, prior to and in preference to all other shares of capital stock of the Company, at an annual rate

of eight percent ( 8 %) compounded annually on the Original Per Share Price (plus any such accreted compounded amounts);

provided that such

annual dividend rate shall increase to fourteen percent ( 14 %) if the Stockholder Approval is not obtained at the first meeting of stockholders

following the Issuance Date (collectively, the “Accruing Dividends”).

Such Accruing Dividends are to be paid monthly (including

for any partial months) on the last day of each month beginning in the month of the Issuance Date according to the wiring instructions

provided by the Holder.

At all times following the Issuance Date, while

shares of Series B Preferred Stock are issued and outstanding, holders of Series B Preferred Stock shall be entitled to receive, and the

Company shall pay, dividends on shares of Series B Preferred Stock equal (on an as-if-converted-to-Common-Stock basis and without regard

to any limitations on conversion set forth herein or otherwise) to and in the same form as dividends (other than dividends in the form

of Common Stock, which shall be made in accordance with the terms of the Series B Certificate of Designation) actually paid on shares

of the Common Stock when, as and if such dividends (other than dividends in the form of Common Stock, which shall be made in accordance

with the terms of the Series B Certificate of Designation) are paid on shares of the Common Stock.

Subject to certain limitations described in the

Series B Certificate of Designation, the Series B Preferred Stock is voting stock.

Holders of the Series B Preferred Stock are entitled

to vote together with the Common Stock on an as-if-converted-to-Common-Stock basis.

13, 2024, we signed a securities purchase agreement with certain healthcare-focused institutional investors that provided $ 50 million

in gross proceeds to us through a private placement.

Pursuant to the securities purchase agreement, we issued to institutional investors

$ 50.0 million in shares of our Series B-1 Convertible Preferred Stock.

50,000 Shares of Series B-1 Convertible Preferred Stock were issued

at a price of $ 1,000.00 per share and each share is convertible into shares of common stock at a rate equal to the initial $ 1,000 purchase

price divided by the initial conversion price of $ 1.00 per share.

to the Certificate of Designation of Preferences, Rights and Limitations of the Series B Convertible Preferred Stock (the “Series

B Certificate of Designation”), as of March 14, 2024, each share of Series B-1 Preferred Stock is, subject to approval of the Company’s

stockholders, convertible into shares of common stock of the Company and, if applicable, shares of Series B-2 Convertible Preferred Stock

(the “Series B-2 Preferred Stock”), in lieu of common stock

has designated 50,000 shares of Series A-1 Preferred Stock and 50,000 shares of Series B-2 Preferred Stock.

B Certificate of Designation states that, to the extent that the conversion of the Series B-1 preferred stock results in a beneficial

ownership interest in excess of the maximum percentage of common stock upon conversion, the holders will receive the as converted equivalent

for the remaining shares in preferred stock.

20, 2024, we held our annual stockholder meeting, and as a result, stockholder approval for the conversion of the Series B-1 Convertible

Preferred Stock was obtained.

On July 5, 2024, pursuant to the Certificate of Designation of Preferences, Rights and Limitations of the

Series B Convertible Preferred Stock, the Company issued 42,118,000 shares of common stock and 7,882 shares of Series B-2 preferred stock

in settlement of the automatic conversion of the Series B-1 Convertible Preferred Stock.

B-1 Preferred Stock have the following rights:

Prior to the receiving Stockholder Approval, dividends will accrue, on all issued and outstanding shares of Series A-1 Preferred Stock,

prior to and in preference to all other shares of capital stock of the Company, at an annual rate of eight percent ( 8 %) compounded annually

on the original per share price (plus any such accreted compounded amounts);

provided that such annual dividend rate shall increase to

fourteen percent ( 14 %) if Stockholder Approval is not obtained at the first meeting of stockholders following the date of the Preferred

Stock offering.

If such dividends are not declared and paid in cash, the dividend amounts will be added to the aggregate liquidation preference

then outstanding of the Series B-1 Preferred Stock.

At all times following the Issuance Date, while shares of Series B-1 Preferred Stock

are issued and outstanding, holders of Series B Preferred Stock shall be entitled to receive, and the Company shall pay, dividends on

shares of Series B-1 Preferred Stock equal (on an as-if-converted-to-Common-Stock basis and without regard to any limitations on

conversion set forth herein or otherwise) to and in the same form as dividends (other than dividends in the form of Common Stock, which

shall be made in accordance with the terms of the Series B Certificate of Designation) actually paid on shares of the Common Stock when,

as and if such dividends (other than dividends in the form of Common Stock, which shall be made in accordance with the terms of the Series

B Certificate of Designation) are paid on shares of the Common Stock.

Stockholder approval was received on June 20, 2024.

Subject to certain limitations described in the Series B Certificate of Designation holders of the Series B-1 Preferred Stock are entitled

to vote together with the common stock on an as-if-converted-to-common-stock basis as determined by dividing the liquidation preference

with respect to such shares of Series B-1 Preferred Stock by the conversion price.

Holders of common stock are entitled to one vote for

each share of common stock held on all matters submitted to a vote of stockholders.

Accordingly, holders of Series B Preferred Stock will

be entitled to one vote for each whole share of Common Stock into which their Series B Preferred Stock is then-convertible on all matters

submitted to a vote of stockholders.

Unless and until the Company has obtained the

Stockholder Approval, the number of shares of Common Stock that shall be deemed issued upon conversion of the Series B Preferred Stock

(for purposes of calculating the number of aggregate votes that the holders of Series B Preferred Stock are entitled to on an as-converted

basis) will be equal to that number of shares equal to 19.9 % of the Company’s outstanding Common Stock as of the Signing Date (excluding

for purposes of the calculation, any securities issued on the Signing Date) (the “Cap”), which each such holder being able

to vote the number of shares of Series B Preferred Stock held by it relative to the total number of shares of Series B Preferred Stock

then outstanding multiplied by the Cap.

Notwithstanding the foregoing, the holders of the Series B Preferred Stock are not entitled to

vote together with the Common Stock on an as-if-converted-to-Common-Stock-basis with regard to the approval of the issuance of Common

Stock upon conversion of the Series B Preferred Stock.

In the event of any voluntary or involuntary liquidation,

dissolution or winding up of the Company, including a change of control transaction, or Deemed Liquidation Event (any such event, a “Liquidation”)

the holders of shares of Series B Preferred Stock then outstanding shall be entitled to be paid out of the assets of the Company available

for distribution to its stockholders, and in the event of a Deemed Liquidation Event, the holders of shares of Series B Preferred Stock

then outstanding shall be entitled to be paid out of the consideration payable to stockholders in such Deemed Liquidation Event or the

other proceeds available for distribution to stockholders, before any payment shall be made to the holders of any other shares of capital

stock of the Company by reason of their ownership thereof, an amount per share equal to the greater of (i) one times (1x) the Original

Per Share Price, plus any Accruing Dividends accrued but unpaid thereon, whether or not declared, together with any other dividends declared

but unpaid thereon (the “Liquidation Preference”) or (ii) such amount per share as would have been payable had all shares

of Series B Preferred Stock been converted into Common Stock (without regard to any limitations on conversion set forth in the Series

B Certificate of Designation or otherwise) immediately prior to such Liquidation (the amount payable pursuant to this sentence is hereinafter

referred to as the “Series B Liquidation Amount”).

If upon any such Liquidation, the assets of the Company available for distribution

to its stockholders shall be insufficient to pay the holders of shares of Series B Preferred Stock the full Liquidation Preference, the

holders of shares of Series B Preferred Stock shall share ratably in any distribution of the assets available for distribution in proportion

to the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts

payable on or with respect to such shares were paid in full.

After the payment in full of all Series B Liquidation Amount, the remaining

assets of the Company available for distribution to its stockholders or, in the case of a Deemed Liquidation Event, the consideration

not payable to the holders of shares of Series B Preferred Stock pursuant to the Series B Certificate of Designation shall be distributed

among the holders of shares of Common Stock, pro rata based on the number of shares held by each such holder.

Following the Stockholder Approval, upon any Liquidation,

the assets of the Company available for distribution to its stockholders shall be distributed among the holders of the shares of Series

B Preferred Stock and Common Stock, pro rata based on the number of shares held by each such holder, treating for this purpose all shares

of Series B Preferred Stock as if they had been converted to Common Stock pursuant to the terms of the Series B Certificate of Designation

immediately prior to such Liquidation, without regard to any limitations on conversion set forth in the Series B Certificate of Designation

or otherwise.

Subject to the terms and limitations contained

in the Series B Certificate of Designation, the Series B-1 Preferred Stock issued in the Private Placement will not become convertible

until the Company’s stockholders approve the issuance of Common Stock upon conversion of the Series B Preferred Stock (as defined

below) in excess of 19.99 % of the Common Stock outstanding on the closing date (the “Stockholder Approval”).

(10th) Trading Day (as defined in the Series B Certificate of Designation) following the announcement of the Stockholder Approval, each

share of Series B-1 Preferred Stock shall automatically convert into Common Stock and if applicable, Series B-2 Preferred Stock.

to the limitations set forth in the Series B Certificate of Designation, at the option of the holder, each share of Series B-2 Preferred

Stock shall be convertible into shares of Common Stock in an amount of shares equal to the Liquidation Preference (as defined below) divided

by the Conversion Price.

The Corporation shall, as soon as practicable

following the Issuance Date, but not more than sixty (60) days thereafter, file a preliminary proxy statement for a vote of its stockholders

to approve the issuance of Common Stock upon conversion of the Series B Preferred Stock in excess of the Cap (the “Proposal”).

Issuance of Common Stock Upon Conversion of Series B-1 Preferred

On June 20, 2024, the Company held its annual

shareholder meeting and, as a result, shareholder approval for the conversion of the Series B-1 Preferred Stock was obtained.

5, 2024, pursuant to the Series B Certificate of Designation, the Company issued 42,118,000 shares of common stock and 7,882 shares of

Series B-2 Preferred Stock in settlement of the auto-conversion of the Series B-1 preferred shares.

As of June 30, 2024, there were 50,000

shares of Series B-1 Preferred Stock issued and outstanding and there were zero shares of Series B-2 Preferred Stock issued and outstanding.

Unless and until the Company has obtained the Stockholder

Approval, the number of shares of Common Stock that shall be deemed issued upon conversion of the Series B Preferred Stock (for purposes

of calculating the number of aggregate votes that the holders of Series B Preferred Stock are entitled to on an as-converted basis) will

be equal to that number of shares equal to 19.9 % of the Company’s outstanding Common Stock as of the Signing Date (excluding for

purposes of the calculation, any securities issued on the Signing Date) (the “Cap”), which each such holder being able to

vote the number of shares of Series B Preferred Stock held by it relative to the total number of shares of Series B Preferred Stock then

outstanding multiplied by the Cap.

Notwithstanding the foregoing, the holders of the Series B Preferred Stock are not entitled to vote

together with the Common Stock on an as-if-converted-to-Common-Stock-basis with regard to the approval of the issuance of Common Stock

upon conversion of the Series B Preferred Stock.

trading day following the announcement of the Stockholder Approval, each share of Series B-1 Preferred Stock shall automatically convert

into a unit consisting of:

(1) the number of shares of common stock equal to the quotient of (A) the liquidation preference with

respect to such share of Series B-1 Preferred Stock, divided by (B) the conversion price, provided that, to the extent the share conversion

would cause such Holder’s beneficial ownership to exceed 9.99 %, such holder shall receive shares of Series B-2 Preferred Stock in

lieu of common stock, on a one-for-one basis, with respect to the number of shares of common stock that exceed 9.99 % ownership divided

The Series B-1 Preferred Stock had a liquidation preference of one-times the original per share price of $ 1,000 per

share, plus any accrued but unpaid dividends thereon, whether or not declared, subject to certain customary anti-dilution adjustments.

B-2 Preferred Stock has the following rights:

Dividends will accrue, on all issued and outstanding shares of Series B-2 Preferred Stock, prior to and in preference to all other shares

of capital stock of the Company, at an annual rate of eight percent ( 8 %) compounded annually on the original per share price (plus any

such accreted compounded amounts).

If such dividends are not declared and paid in cash, the dividend amounts will be added to the aggregate

liquidation preference then outstanding.

Subject to certain limitations described in the Series B Certificate of Designation, the Series B-2 Preferred Stock is voting stock.

of the Series B-2 Preferred Stock are entitled to vote together with the common stock on an as-if-converted-to-common-stock basis.

of common stock are entitled to one vote for each share of common stock held on all matters submitted to a vote of stockholders.

holders of Series B-2 Preferred Stock will be entitled to one vote for each whole share of common stock into which their Series B-2 Preferred

Stock is then-convertible on all matters submitted to a vote of stockholders.

Liquidation .

Upon any Liquidation, the

assets of the Company available for distribution to its stockholders shall be distributed among the holders of the shares of Series B

Preferred Stock and common stock, pro rata based on the number of shares held by each such holder, treating for this purpose all shares

of Series B Preferred Stock as if they had been converted to common stock pursuant to the terms of the Certificate of Designation immediately

prior to such Liquidation, without regard to any limitations on conversion set forth in the Series B Certificate of Designation or otherwise.

Subject to the limitations

set forth in the Series B Certificate of Designation, at the option of the holder thereof, each share of Series B-2 Preferred Stock, is

convertible into the number of shares of common stock equal to the quotient of (A) the stated value ($ 1,000 ), divided by (B) the conversion

price on the applicable conversion date, which is $ 1.00 as of the date of this report.

Warrant Liability

50 unchanged sentences

the exercise price for the Warrants became fixed.

Therefore, as of December 31, 2023 and June 30, 2024, the fair value of the Warrants

Therefore, as of December 31, 2023 and September 30, 2024, the fair value of the Warrants

was determined using a Black Scholes model using parameters including (i) the exercise price of the warrant, (ii) the price of the underlying

16 unchanged sentences

The tables below summarize the valuation inputs into the Black Scholes

model for the liability associated with the three tranches of Warrants at December 31, 2023 and June 30, 2024.

model for the liability associated with the three tranches of Warrants at December 31, 2023 and September 30, 2024.

Tranche A Warrant

September 30,

Fair value of underlying stock

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Tranche B Warrant

September 30,

Fair value of underlying stock

10 unchanged sentences

Tranche C Warrant

September 30,

Fair value of underlying stock

12 unchanged sentences

estimated the fair value of the Warrants to be $ 2.8 million.

As of December 31, 2023 and June 30, 2024, the Company estimated the fair

value of the Warrants to be $ 13.1 million and $ 8.1 million, respectively.

As of December 31, 2023 and September 30, 2024, the Company estimated the

fair value of the Warrants to be $ 13.1 million and $ 6.4 million, respectively.

The following table summarizes activity for the

Company’s preferred stock warrants for the six months ended June 30, 2024:

Company’s preferred stock warrants for the nine months ended September 30, 2024:

Number of Average

6 unchanged sentences

Warrants exercised -

Outstanding, June 30, 2024 160,958,167 $ 0.64 2.63 $ -

Outstanding, September 30, 2024 160,958,167 $ 0.64 2.37 $ -

Stock-based Compensation

16 unchanged sentences

of common stock were available under the 2021 Plan.

As of June 30, 2024, there are approximately 8,027,805 shares of common stock available

under the 2021 Plan.

As of September 30, 2024, there are approximately 7,433,327 shares of common stock

available under the 2021 Plan.

The following table summarizes activity for stock

options under all plans for the six months ended June 30, 2024:

options under all plans for the nine months ended September 30, 2024:

Number of Average

7 unchanged sentences

Options exercised ( 1,357 ) $ 3.27 -

Outstanding, June 30, 2024 13,088,621 $ 1.03 9.05 $ 48

Options vested and exercisable as of June 30, 2024 3,877,191 $ 1.31 8.5 $ 48

As of June 30, 2024, the unrecognized compensation

Outstanding, September 30, 2024 13,671,140 $ 1.00 8.84 $ 81

Options vested and exercisable as of September 30, 2024 4,675,005 $ 1.28 8.31 $ 39

As of September 30, 2024, the unrecognized compensation

cost related to outstanding stock options was $ 6.0 million, which is expected to be recognized as expense over approximately 4.0 years.

During August 2023, the Company granted a consultant

10,000 restricted stock units with a grant date fair value of $ 7,500 , resulting in a fair value per share of $ 0.75 .

Subject to the consultant’s

continued service, the restricted stock units shall vest upon the two-year anniversary of the date of grant.

As of June 30, 2024, the

unrecognized compensation cost related to the grant was approximately $ 2,500 , which is expected to be recognized as expense over approximately

During the year ended December 31, 2021, employees

and consultants exercised a total of 383,721 stock options and the Company received $ 119,000 in proceeds.

A portion of these options were

exercised early (prior to vesting), and as of June 30, 2024, 194 of the options remained unvested.

Proceeds received related to the unvested

options of approximately $ 631 at June 30, 2024 were included in accrued liabilities on the accompanying balance sheet and will be reclassified

to equity as vesting occurs, provided the employees and consultants continue to provide services to the Company.

Proceeds received related

to the vested portion of options of $ 2,500 were reclassified to equity during the six months ended June 30, 2024.

The vested portion of

the exercises was 383,521 shares at June 30, 2024.

the year ended December 31, 2021, employees and consultants exercised a total of 383,721 stock options and the Company received $ 119,000

A portion of these options were exercised early (prior to vesting), and as of September 30, 2024, none of the options remained

Proceeds received related to the vested portion of options of $ 2,500 were reclassified to equity during the nine months ended

September 30, 2024.

During May 2022, the Company granted a consultant

2 unchanged sentences

units vested in May 2024.

During August 2023, the Company granted a consultant

10,000 restricted stock units with a grant date fair value of $ 7,500 , resulting in a fair value per share of $ 0.75 .

The restricted stock

units will vest in March 2025.

During August 2024, the Company granted a consultant

11,765 restricted stock units with a grant date fair value of $ 4,000 , resulting in a fair value per share of $ 0.34 .

The restricted stock

units will vest in August 2026.

The Company has recorded stock-based compensation

expense, which includes expense related to restricted stock units, allocated by functional cost as follows for the three and six months

ended June 30, 2023 and 2024 (in thousands):

expense, which includes expense related to restricted stock units, allocated by functional cost as follows for the three and nine months

ended September 30, 2023 and 2024 (in thousands):

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Research and development

13 unchanged sentences

fair value of the common stock underlying the Company’s stock options prior to the initial public offering was estimated at each

grant date and was determined on a periodic basis and based either on transactions with third parties in which common stock was sold for

cash or with the assistance of an independent third-party valuation expert.

grant date and was determined on a periodic basis and based either on transactions with third parties in which common stock was sold

for cash or with the assistance of an independent third-party valuation expert.

Subsequent to our initial public offering, the fair value

1 unchanged sentence

The assumptions

underlying these valuations represented management’s best estimates, which involved inherent uncertainties and the application of

significant levels of management judgment.

underlying these valuations represented management’s best estimates, which involved inherent uncertainties and the application

of significant levels of management judgment.

Volatility - The expected volatility

5 unchanged sentences

Expected Dividend – Through

June 30, 2024, the Company has never declared nor paid any cash dividends.

The Company shall modify its dividend policy to state that

the Company intends to pay dividends to all stockholders, including holders of Series A Preferred Stock on an as-if-converted-to-common-stock

basis, on a quarterly basis in an amount of which the aggregate of all quarterly dividends shall equal at least seventy-five percent ( 75 %)

of its annual net cash flow from operations following the approval of oxylanthanum carbonate by the FDA if obtained, and the commencement

of commercial sales.

There were no equity awards granted to employees,

directors and non-employees for the six months ended June 30, 2023.

The following averaged assumptions were used to calculate the fair

value of awards granted to employees, directors and non-employees for the six months ended June 30, 2024:

Six Months Ended

September 30, 2024, the Company has never declared nor paid any cash dividends to common stockholders.

SERIES B-1 DIVIDENDS PAID IN CASHThe

Company shall modify its dividend policy to state that the Company intends to pay dividends to all stockholders, including holders of

Series A Preferred Stock on an as-if-converted-to-common-stock basis, on a quarterly basis in an amount of which the aggregate of all

quarterly dividends shall equal at least seventy-five percent ( 75 %) of its annual net cash flow from operations following the approval

of oxylanthanum carbonate by the FDA if obtained, and the commencement of commercial sales.

The following averaged assumptions were used to

calculate the fair value of awards granted to employees, directors and non-employees for the nine months ended September 30, 2023 and

September 30, 2024:

Nine months Ended

September 30,

Expected volatility

104 % – 108 %

104 % - 106 %

Risk-free interest rate

4.35 % – 4.36 %

3.77 % - 4.65 %

Dividend yield

Expected term

Net Income (Loss) Per Share

The Company computes net income (loss) per share

using the two-class method.

The two-class method uses an earnings allocation formula that determines net income (loss) per share for common

stock and any participating securities according to dividends declared and participation rights in undistributed earnings.

Diluted net income (loss) per share includes the

potential dilutive effect of common stock equivalents as if such securities were converted or exercised during the period, when the effect

Net Loss Per Share

The Company computes net loss per share using

the two-class method.

The two-class method uses an earnings allocation formula that determines net loss per share for common stock and

any participating securities according to dividends declared and participation rights in undistributed earnings.

Diluted net loss per share includes the potential

dilutive effect of common stock equivalents as if such securities were converted or exercised during the period, when the effect is dilutive.

Common stock equivalents include:

(i) outstanding stock options and restricted stock units;

(ii) common stock to be issued

upon the assumed exercise of the Company’s common stock warrants;

(ii) common stock to be issued upon the assumed

exercise of the Company’s common stock warrants;

(iii) convertible preferred stock;

and (iv) prior to issuance,

the issuable warrants related to the Company’s March private placement financing.

and (iv) prior to issuance, the issuable warrants

related to the Company’s March private placement financing.

The following table sets forth the computation

of basic and diluted net income (loss) per share of common and preferred stock (in thousands, except share and per share data):

of basic and diluted net loss per share of common and preferred stock (in thousands, except share and per share data):

Three Months Ended

Six Months Ended

Basic net income (loss) per share

Net income (loss)

Net income (loss) attributable to participating securities

September 30,

Nine Months Ended

September 30,

Basic net loss per share

Deemed dividends on preferred stock

Net income (loss) attributable to common shares, basic

Weighted-average shares outstanding used in computing net income (loss) per share attributable to common stockholders, basic

Net income (loss) per share attributable to common stockholders, basic

Diluted net income (loss) per share

Net income (loss) attributable to common shares, basic

Change in fair value of preferred stock warrant liability

Net (loss) attributable to common shares, diluted

Weighted-average shares outstanding used in computing net loss per share attributable to common stockholders, basic

Weighted-average effect of diluted securities:

Tranche warrants to purchase convertible preferred stock

Weighted-average shares outstanding used in computing net loss per share attributable to common stockholders, diluted

Net loss per share attributable to common stockholders, diluted

Cash Dividends to Series B holders

Net loss attributable to common shares, basic and diluted

Weighted-average shares outstanding used in computing net loss per share attributable to common stockholders, basic and diluted

Net loss per share attributable to common stockholders, basic and diluted

The following outstanding shares of potentially

2 unchanged sentences

Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Options to purchase common stock

5 unchanged sentences

Subsequent Events

On July 5, 2024, the Company completed the automatic conversion of

the Series B-1 convertible preferred stock whereby each share of Series B-1 preferred stock converted into a combination of common stock

and Series B-2 convertible preferred stock.

On September 3, 2024, we submitted a New Drug Application (NDA) to the U.S.

Food and Drug Administration (FDA) for Oxylanthanum Carbonate

(OLC) for the treatment of hyperphosphatemia in patients with chronic kidney disease (CKD) on dialysis.

On November 11, 2024, we announced

that the FDA has accepted the NDA for OLC and has set a Prescription Drug User Fee Act (PDUFA) target action date of June 28, 2025.

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 1. Financial Statements