What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-05-14 compared with 2024-11-13 · 154 added, 179 removed, 291 unchanged (53% of the section changed)

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Forward Looking Statements

This Quarterly Report on Form 10-Q for the nine-month

period ended September 30, 2024 contains “forward-looking statements” within the meaning of the Securities Act of 1933, as

amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

forward-looking statements contain information about our expectations, beliefs or intentions regarding our product development and commercialization

efforts, business, financial condition, results of operations, strategies or prospects, and other similar matters.

This Quarterly Report on Form 10-Q for the three-month

period ended March 31, 2025 contains “forward-looking statements” within the meaning of the Securities Act of 1933, as amended

(the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

These forward-looking

statements are based on management’s current expectations and assumptions about future events, which are inherently subject to uncertainties,

statements contain information about our expectations, beliefs or intentions regarding our product development and commercialization efforts,

business, financial condition, results of operations, strategies or prospects, and other similar matters.

These forward-looking statements

are based on management’s current expectations and assumptions about future events, which are inherently subject to uncertainties,

risks and changes in circumstances that are difficult to predict.

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dollars, unless otherwise noted.

We are a biotechnology company dedicated to developing

treatments for kidney disease that have the potential to offer clinical benefit.

Our development programs are focused on the development

of two novel therapies:

oxylanthanum carbonate , for treatment of hyperphosphatemia in patients with chronic kidney disease, and UNI 494,

for treatment of acute kidney injury (AKI).

We are a clinical-stage biotechnology company

focused on identifying, developing, and commercializing innovative therapies to address significant unmet medical needs, with an initial

focus on kidney disease.

Founded in 2016, Unicycive was established to create a streamlined and efficient drug development platform capable

of accelerating the advancement of promising therapies from discovery to commercialization.

Currently, our two programs are focused on

kidney disease, an area we believe we have the potential to offer medical benefit.

Our initial focus is on developing drugs and getting

them approved in the U.S., and then to partner with global biopharmaceutical companies in the rest of the world.

As we grow the company

and build our team, we intend to focus on identifying medical conditions within and outside of kidney disease.

Our business model is to

license technologies and drugs in order to pursue development, regulatory approval, and commercialization of those products in global

Many biotechnology companies utilize similar strategies of in-licensing and then developing and commercializing drugs.

however, that our management team’s broad network, expertise in the biopharmaceutical industry, and successful track record gives

us an advantage in identifying and bringing these assets into our company.

Our current development programs are focused on

two novel therapies:

Oxylanthanum Carbonate, a next-generation phosphate binder for the treatment of hyperphosphatemia in chronic kidney

disease patients on dialysis, and UNI-494, a novel drug candidate in development for the treatment of acute kidney injury.

Carbonate and UNI-494 were initially developed by and licensed to us from Spectrum Pharmaceuticals (“Spectrum”) and Sphaera

Pharma, respectively.

Spectrum conducted a Phase 1 clinical trial with Oxylanthanum Carbonate in 2012, prior to the grant of our license

Sphaera conceived and performed initial characterization of various potential pro-drug linkers, including the initial patent

As discussed herein, after completing IND enabling preclinical studies, we have completed a Phase I clinical study in healthy

volunteers with UNI-494 in 2024.

Chronic kidney disease (CKD) is the gradual loss

of kidney function that can get worse over time leading to lasting damage.

Our initial focus is developing drugs and getting them approved

in the U.S., and then to partner with the other global biopharmaceutical companies in the rest of the world.

According to United States

Renal Data System (USRDS) 2022 Annual Data Report, 30 million (14%) of adults in the United States are estimated to have CKD and, of these,

approximately 13 million patients have advanced CKD (stage 3-5).

Approximately 550,000 patients (ESRD) are on dialysis and of those, approximately

450,000 patients (~80%) take phosphate binders to control hyperphosphatemia (too much phosphorus in their blood).

The number of patients

with ESRD in the U.S.

is increasing steadily and is projected to reach between 971,000 and 1,259,000 patients in 2030.

of kidney (renal) function that can get worse over time leading to lasting damage and possibly Stage 5 or end-stage renal disease (ESRD).

CKD affects nearly 36 million Americans;

approximately 550,000 of them have end stage renal disease and require dialysis.

Hyperphosphatemia

is common in people with CKD and has been directly linked to increased morbidity and mortality for people on dialysis.

For an estimated

75% of people in the U.S.

on dialysis, hyperphosphatemia remains uncontrolled due to challenges with the six currently available phosphate

binders, namely insufficient potency, pill burden and unpalatable formulations.

To address this significant and growing challenge, Unicycive

is developing Oxylanthanum Carbonate, which leverages proprietary nanoparticle technology to address the shortcomings of current therapies

by delivering higher potency that enables fewer and smaller pills — all in a formulation that is more acceptable for patients because

it is swallowed, not chewed.

With OLC, if approved, people on dialysis and their physicians may have a better option to control hyperphosphatemia.

AKI is a sudden episode of kidney failure or kidney

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AKI affects more than

2 million US patients and costs the healthcare system in excess of $9 billion per year.

2 million U.S.

patients and costs the healthcare system in excess of $9 billion per year.

More than 300,000 patients per year in the U.S.

die due to AKI that has many causes.

die due to AKI.

Currently there are no FDA approved medicines to treat DGF and/or AKI.

Treatment options for AKI include continuous renal

replacement therapy, renal transplant, and dialysis.

In most cases the damage to the kidney is irreversible, and the patient needs to

have a renal transplant or be on dialysis for life.

Therefore, there is a high unmet medical need.

If approved, UNI-494 has the potential

to be a first-in-class drug for the treatment of AKI.

Our business model is to license technologies

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We have incurred significant operating losses to date.

Our net losses were

$22.7 million and $15.2 million for the nine months ended September 30, 2023, and September 30, 2024, respectively.

As of September

30, 2024, we had an accumulated deficit of $79.7 million.

We expect that our operating expenses will increase significantly as we advance

our product candidates through pre-clinical and clinical development, seek regulatory approval, and prepare for and, if approved, proceed

to commercialization;

Our net loss was $20.9

million for the three months ended March 31, 2024 and we had net income of 0.6 million for the three months ended March 31, 2025.

March 31, 2025, we had an accumulated deficit of $100.7 million.

We expect that our operating expenses will increase significantly as

we advance our product candidates through pre-clinical and clinical development, seek regulatory approval, and prepare for and, if approved,

proceed to commercialization;

acquire, discover, validate and develop additional product candidates;

obtain, maintain, protect and enforce our

intellectual property portfolio;

obtain, maintain, protect and enforce

our intellectual property portfolio;

and hire additional personnel.

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Recent Developments

New Drug Application

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.

Series B Preferred Financing

On March 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

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.

On June 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

Extension of Nasdaq Compliance Period

On July 9, 2024, we received written notice (the

“ Notice ”) from the Nasdaq Stock Market, LLC (“ Nasdaq ”) indicating that the bid price of our common

stock, for the last 30 consecutive business days, had closed below the minimum $1.00 per share and, as a result we were not in compliance

with the $1.00 minimum bid price requirement for the continued listing on the Nasdaq Capital Market, as set forth in Nasdaq Listing Rule

In accordance with the Nasdaq Listing Rule 5810(c)(3)(A),

we had a period of 180 calendar days, or until January 6, 2025, to regain compliance with the minimum bid price requirement.

As of January 6, 2025we had not regained compliance

with the minimum bid price requirement.

On January 7, 2025, Nasdaq notified us that we would have an additional 180 calendar days, or

until July 7, 2025, to regain compliance.

Issuance of Common Stock Upon Conversion of

Series A-2 Prime Preferred Stock

On February 18, 2025, we issued 1,400,000 shares

(the “Shares”) of common stock, upon conversion of 686.00 shares of our Series A-2 Prime Preferred Stock.

Components of Results of Operations

We recognize revenue from product sales or services

rendered when control of the promised goods is transferred to a counterparty in an amount that reflects the consideration to which we

expect to be entitled in exchange for those goods and services.

To achieve this core principle, we apply the following five steps:

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 we satisfy a performance obligation.

We may earn licensing

revenue in the future if we negotiate business development arrangements with third parties.

Research and Development Expenses

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Results of Operations

Comparison of the Three Months Ended September

Comparison of the Three Months Ended March 31,

2024 and 2025

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Three Months Ended

September 30,

Licensing revenues:

Operating expenses:

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Total other income (expenses)

Licensing Revenues

There was no Licensing revenue recorded in the

three months ended September 30, 2023 or in the three months ended September 30, 2024.

We may earn additional licensing revenue in the

future if we negotiate business development arrangements with third parties.

Net (loss) income

Research and Development Expenses

Research and development expenses decreased by

approximately $0.4 million, or 10%, from approximately $3.4 million for the three months ended September 30, 2023, to approximately $3.0

million for the three months ended September 30, 2024.

The decrease in research and development expenses was primarily due to a $0.4 million

decrease in drug development costs.

Labor costs increased $151,000 from the prior period.

Consulting and other costs increased $89,000.

Non-cash stock compensation costs decreased $176,000.

approximately $4.6 million, or 68%, from approximately $6.8 million for the three months ended March 31, 2024, to approximately $2.2 million

for the three months ended March 31, 2025.

The decrease in research and development expenses was primarily due to a $5.0 million reduction

in drug development costs which was partially offset by an increase in labor costs of $151,000 over the prior period.

Consulting and other

costs increased $189,000 and stock compensation of $36,000.

General and Administrative Expenses

General and administrative expenses increased

by 640,000, or 25%, from approximately $2.6 million for the three months ended September 30, 2023, to approximately $3.2 million for the

three months ended September 30, 2024 primarily due to an decrease of $149,000 in non-cash stock compensation costs.

Insurance expense

decreased $2,000.

Labor costs increased $76,000 from the prior period.

by $3.4 million, or 143%, from approximately $2.4 million for the three months ended March 31, 2024, to approximately $5.8 million for

the three months ended March 31, 2025 primarily due to an increase of $1.4 million in consulting and professional services expenses related to preparation of our

commercial launch.

Other professional services increased $1.3 million from the prior period.

Labor costs increased $467,000 from

the prior period.

Travel, rent, and other costs increased $230,000.

Non-cash stock compensation costs increased $6,000.

Other Income (Expenses)

Other income (expenses) increased $20.3 million,

or 34%, from $1.6 million in the three months ended September 30, 2023 to $2.2 million for the three months ended September 30, 2024 due

primarily to a change in fair value of our warrant liability.

Comparison of the Nine Months Ended September

30, 2023 and 2024

Nine months Ended

September 30,

Licensing revenues:

Operating expenses:

Research and development

General and administrative

Total operating expenses

Loss from operations

Other income (expenses):

Interest income

Interest expense

Change in fair value of warrant liability

Total other income (expenses)

Licensing Revenues

Licensing revenues decreased approximately $0.7

million, or 100%, from the nine months ended September 30, 2023 due to an upfront payment of approximately $0.7 million associated with

a licensing agreement entered into with Lotus International Pte Ltd.

in February 2023.

There was no comparable revenue earned in the current

We may earn additional licensing revenue in the future if we negotiate business development arrangements with third parties.

Research and Development Expenses

Research and development expenses increased by

approximately $6.0 million, or 70%, from approximately $8.7 million for the nine months ended September 30, 2023 to approximately $14.7

million for the nine months ended September 30, 2024.

The increase in research and development expenses was primarily due to a $5.4 million

increase in drug development costs.

Labor costs increased $272,000 from the prior period.

Consulting and other costs increased $206,000.

Non-cash stock compensation increased $170,000.

General and Administrative Expenses

General and administrative expenses increased

by $1.7 million, or 26%, from approximately 6.5 million for the nine months ended September 30, 2023 to approximately $8.1 million for

the nine months ended September 30, 2024 due to an increase of $380,000 in noncash stock compensation expense.

Labor costs increased $355,000.

Insurance, travel and other costs increased $928,000 from the prior period.

Other Income (Expenses)

Other income (expenses) increased by $15.5 million

(income), or 178%, from $8.7 million expense in the nine months ended September 30, 2023 to $6.8 million income for the nine months ended

September 30, 2024 due primarily to the change in fair value of our warrant liability.

or 173%, from $11.8 million expense in the three months ended March 31, 2024 to $8.6 million income for the three months ended March 31,

2025 primarily due to a change in fair value of our warrant liability.

Interest income increased approximately $157,000 for the three

months ended March 31, 2025 versus the comparable prior period.

Liquidity and Capital Resources

Sources of Liquidity

Since our formation through December 31,

2020, we have funded our operations with the sale of common and preferred stock, convertible notes and from a loan from our Chief Executive

Officer and principal stockholder.

Since our formation through June 31, 2020,

we funded our operations with the sale of common and preferred stock, convertible notes and from a loan from our Chief Executive Officer

and principal stockholder.

As a result of our initial public offering (“IPO”),

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or licensing revenue as well as product sales.

We have generated approximately $1.6 million in licensing revenue to date.

On March 3, 2023, we 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 $30.0 million.

Proceeds from the offering will be used to support our

NDA submission with the FDA for approval of oxylanthanum carbonate for the treatment of hyperphosphatemia in the U.S.

and, if approved,

for the commercial launch of oxylanthanum carbonate in the U.S.

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

On March 13, 2024, we entered into a securities

purchase agreement with certain accredited investors pursuant to which we agreed to issue and sell, in a private placement, 50,000 shares

of our Series B Convertible Preferred Stock, par value $0.001 per share at a purchase price of $1,000 per share with an initial conversion

price of $1.00 per share, for an aggregate purchase price of $50.0 million.

purchase agreement with certain accredited investors to provide $50 million in gross proceeds through a private placement.

the securities purchase agreement, we issued institutional purchasers $50.0 million in shares of Series B Convertible Preferred Stock.

We received $46.2 million in net proceeds.

On November 13, 2024, we entered into a sales

agreement, with Guggenheim Securities, LLC pursuant to which, we may offer and sell shares of common stock having an aggregate offering

price of up to $50.0 million, subject to certain limitations and in accordance with the terms of the sales agreement, from time to time

through or to Guggenheim Securities, acting as sales agent or principal.

During the three months ended March 31, 2025, the Company sold

4,507,379 shares of common stock at an average price of $0.62 per share and paid $84,000 in commissions, resulting in net proceeds to

the Company of approximately $2.7 million.

Future Funding Requirements

We have incurred net losses since our inception.

For the nine months ended September 30, 2024, we had a net loss of $15.2 million, and we expect to incur substantial additional losses

in future periods.

As of September 30, 2024, we had an accumulated deficit of $79.7 million.

have incurred net losses since our inception.

For the three months ended March 31, 2025, we had net income of $0.6 million.

the net income was a result of the change in the fair value of the warrant liability.

We expect to incur substantial losses in future

As of March 31, 2025, we had an accumulated deficit of $100.7 million.

We expect to continue incurring losses in the

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our cash in amounts sufficient to sustain operations and meet our obligations.

Based on our current level of expenditures, we believe

that we have sufficient resources such that there is not substantial doubt about our ability to continue operations for at least one year

after the date that these financial statements are available to be issued.

Based on our currently anticipated level of expenditures,

we believe that current available cash will not be sufficient to fund planned expenditures and meet obligations through the end of the

first quarter of 2026, and there is substantial doubt about our ability to continue as a going concern for one year after the date that

these financial statements are available to be issued.

We anticipate that we will need to raise substantial

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which could materially affect our business and financial condition.

R elated Party Payable

The Company received advances from the stockholder

of $210,000 during February 2023.

The Company repaid amounts owed to the stockholder of $210,000 plus accrued interest during March 2023.

Summary of Cash Flows

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and uses of cash for each of the periods presented below (in thousands):

Nine Months Ended

September 30,

Three Months Ended

Net cash (used in) provided by:

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Financing activities

Net increase in cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Cash Flows from Operating Activities

Net cash used in operating activities was $8.9

million for the nine months ended September 30, 2024.

million for the three months ended March 31, 2025.

Cash used in operating activities was primarily due to the use of funds for development

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Net cash used in operating activities was $6.5

million for the nine months ended September 30, 2023.

million for the three months ended March 31, 2024.

Cash used in operating activities was primarily due to the use of funds for development

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Net cash used in investing activities was $16,000

for the nine months ended September 30, 2024 and was due to the purchase of lab equipment.

for the three months ended March 31, 2025 and was due to the purchase of furniture and fixtures for our corporate office.

Net cash used in investing activities was $6,000

for the nine months ended September 30, 2023 and was due to the purchase of furniture and fixtures for our corporate office.

for the three months ended March 31, 2024 and was due to the purchase of furniture and fixtures for our corporate office.

Cash Flows from Financing Activities

Net cash provided by financing activities was

$44.7 million during the nine months ended September 30, 2024 due primarily to the private placement financing agreement we signed on

March 13, 2024 , partially offset by dividends paid to preferred stockholders.

$2.5 million during the three months ended March 31, 2025 due primarily to the at the market public offering agreement we signed on November

Net cash provided by financing activities was

$27.7 million during the nine months ended September 30, 2023 due primarily to the private placement financing agreement we signed on

March 3, 2023.

$45.7 million during the three months ended March 31, 2024 due primarily to the private placement financing agreement we signed on March

Critical Accounting Policies, Significant Judgments and Use of Estimates

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warrant liabilities.

There have been no other material changes to our critical accounting policies and estimates during the nine months

ended September 30, 2024 from those used for the year ended December 31, 2023.

The below policies represent our critical accounting policies.

There have been no other material changes to our critical accounting policies and estimates during the three months

ended March 31, 2025, from those used for the year ended December 31, 2024.

The policies below represent our critical accounting policies.

Revenue Recognition

We implemented ASC 606, Revenue from Contracts

with Customers.

This included the development of new policies based on the five-step model provided in the new revenue standard, ongoing

contract review requirements, and gathering of information provided for disclosures.

We recognize revenue from product sales or services

rendered when control of the promised goods are transferred to a counterparty in an amount that reflects the consideration to which we

expect to be entitled in exchange for those goods and services.

To achieve this core principle, we apply the following five steps:

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 we satisfy a performance obligation.

We apply ASC 606, Revenue from Contracts with

Customers, for our revenue recognition guidance.

This includes the development of new policies based on the five-step model provided in

the revenue standard, ongoing contract review requirements, and gathering of information provided for disclosures.

We recognize revenue

from product sales or services rendered when control of the promised goods is transferred to a counterparty in an amount that reflects

the consideration to which we expect to be entitled in exchange for those goods and services.

To achieve this core principle, we apply

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 we satisfy a performance

Debt and Equity Classification

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We account for these warrants as liabilities

(in accordance with ASC 480, Distinguishing Liabilities from Equity ) on the balance sheets as a result of certain redemption clauses

that are not within the control of the Company.

The warrant liabilities are initially measured at fair value, resulting in an implied

discount on the related preferred stock financing arrangement (recognized as a partial offset to the carrying value of the Series A-1

Preferred Stock), and are remeasured at fair value each reporting period.

Changes in the fair value of the warrant liabilities are recognized

in earnings during each period.

(in accordance with ASC 480) on the balance sheets as a result of certain redemption clauses that are not within the control

of the Company.

The warrant liabilities are initially measured at fair value, resulting in an implied discount on the related preferred

stock financing arrangement (recognized as a partial offset to the carrying value of the Series A-1 Preferred Stock), and are remeasured

at fair value each reporting period.

Changes in the fair value of the warrant liabilities are recognized in earnings during each period.

The warrant liabilities are measured using Level 3 fair value inputs.

See Note 12 for a description of

warrant liabilities and the related valuations.

See Note 10 for a description of warrant liabilities and the related

Research and Development

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We expense both internal and external research and

development expenses as they are incurred.

development expenses as incurred.

Stock-Based Compensation

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis