What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-05-13 compared with 2024-11-05 · 125 added, 239 removed, 141 unchanged (72% of the section changed)

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

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with (i) our unaudited interim financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and (ii) our audited financial statements and notes thereto and management’s discussion and analysis of financial condition and results of operations for the years ended December 31, 2022 and 2023 included in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (the “SEC”) on February 29, 2024.

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with (i) our unaudited interim financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and (ii) our audited financial statements and notes thereto and management’s discussion and analysis of financial condition and results of operations for the years ended December 31, 2024 and 2023 included in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission (the “SEC”) on March 11, 2025.

Our financial statements have been prepared in accordance with U.S.

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Our actual results could differ materially from those discussed in these forward-looking statements.

In evaluating our business, you should carefully consider the information set forth in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 29, 2024, in this Quarterly Report under Part II - Item 1A “Risk Factors,” and in our other filings with the SEC.

In evaluating our business, you should carefully consider the information set forth in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on March 11, 2025, in this Quarterly Report under Part II - Item 1A “Risk Factors,” and in our other filings with the SEC.

We are a dermatology therapeutics company developing and selling medications for skin diseases requiring medical intervention.

We are primarily focused on developing clinician administered therapies in areas of high unmet need.

Our current product portfolio consists of one approved product with several potential follow-on indications, as well as two additional pipeline products.

Our commercial product, YCANTH (VP-102) (formerly referred to as VP-102), was approved by the U.S.

Our commercial product and portfolio of product candidates are clinician administered therapies in areas of high unmet need.

Our current product portfolio consists of one approved product with several potential follow-on indications, as well as an additional pipeline product.

Our commercial product, YCANTH (VP-102), was approved by the U.S.

Food and Drug Administration, or FDA, in July 2023 for the treatment of molluscum contagiosum in adult and pediatric patients two years of age and older.

YCANTH (VP-102) is a proprietary drug-device combination that contains a GMP-controlled formulation of cantharidin.

We are also developing YCANTH (VP-102) for potential follow-on indications for the treatment of common warts and external genital warts.

Our two additional product candidates are:

(i) VP-315 an oncolytic peptide-based injectable therapy for the potential treatment of dermatology oncologic conditions, including basal cell carcinoma, and (ii) VP-103, a second cantharidin based drug device combination for the potential treatment of plantar warts.

On July 21, 2023, YCANTH (cantharidin) 0.7% topical solution was the first product approved by the FDA for the treatment of molluscum contagiosum in adult and pediatric patients two years of age and older.

We are currently developing YCANTH (VP-102) for a potential follow-on indication for the treatment of common warts.

Our second development candidate, VP-315, is an oncolytic peptide-based injectable therapy for the potential treatment of dermatology oncologic conditions, including basal cell carcinoma, or BCC.

Commercial Product

We commercially launched YCANTH (VP-102) in August 2023 in the United States for the treatment of molluscum contagiosum.

We have built a specialized sales organization consisting of 35 sales representatives in the United States focused on pediatric dermatologists, dermatologists, and select pediatricians.

We also plan to advance YCANTH (VP-102) for common warts and external genital warts through a separate regulatory approval process.

We are currently commercializing YCANTH (VP-102) for the treatment of molluscum contagiosum in the United States and in the future we intend to pursue YCANTH (VP-102) for common warts and genital warts if approved.

We also will evaluate the expansion of our commercialization efforts in additional geographic regions, either alone or together with a strategic partner.

Verrica is continuously reviewing and making changes to its commercialization organization designed to balance sales growth and cost controls based upon distribution and reimbursement coverage for YCANTH (VP-102).

We are also developing YCANTH (VP-102) for the treatment of common warts.

In June 2019, we announced positive topline results from our COVE-1 Phase 2 open label clinical trial of YCANTH (VP-102) for the treatment of common warts.

COVE-1 included two cohorts that evaluated the safety and efficacy of YCANTH (VP-102) in subjects with up to six warts.

We held a Type C meeting with FDA on clinical development plan for YCANTH (VP-102) common warts indication on November 6, 2023.

The meeting and additional extensive regulatory correspondence with the FDA has resulted in gaining in-depth alignment on the design of a pivotal Phase 3 clinical development plan to evaluate YCANTH (VP-102) for the treatment of common warts.

On May 14, 2024, we entered into the First Amendment to the Collaboration and License Agreement, or the First Amendment, with Torii Pharmaceutical Co., Ltd., or Torii.

Pursuant to the First Amendment, we and Torii will equally split the cost of a global Phase 3 clinical trial of YCANTH (VP-102) for the treatment of common warts, or the Trial, with Torii paying all of the costs when

due and we will repay Torii half of the costs, or the Company Portion.

The Company Portion accrues interest annually at the greater of (i) the one-month SOFR plus 2% and (ii) 6%.

Torii has the right to offset the Company Portion plus applicable interest against certain of the milestone-based payments that would otherwise be due to us under the terms of the Collaboration and License Agreement.

In addition, if Torii has not received payment or other recoupment in full of the Company Portion plus applicable interest within 60 months after the date on which Torii made its first payment for the Trial costs, Torii may invoice us for the remained Company Portion plus applicable interest.

Torii may recoup our share of the costs plus applicable interest against any development milestone payments in the Torii Agreement.

We anticipate the Company and Torii will agree to a Global Study Plan during the fourth quarter of 2024 and the Trial will begin in the first half of 2025.

The Company has incurred costs of $0.1 million related to the study during the three month period ended September 30, 2024.

In conjunction with the First Amendment, we issued Torii a warrant to purchase up to 500,000 shares of our common stock at an exercise price per share of $9.56.

The warrant has a term of ten years and is exercisable only with respect to the shares that have vested as of the date of exercise.

The shares underlying the warrant will vest as follows:

one-third on the date the first patient is dosed in the Trial, one-third on the date that the database lock with respect to the Trial occurs, and one-third on the date the Company submits a new drug application to the FDA for YCANTH (VP-102) for the treatment of common warts.

In addition, we are also developing YCANTH (VP-102) for the treatment of external genital warts.

We initiated a Phase 2 clinical trial evaluating the optimal dose regimen, efficacy, safety and tolerability of YCANTH (VP-102) in patients with external genital warts in June 2019.

In November 2020, we announced positive topline results from our Phase 2 clinical trial of YCANTH (VP-102) for the treatment of external genital warts.

An end of Phase 2 meeting was held with the FDA in May 2021.

Based on results of the Phase 2 trial, we are evaluating the timing and design of a Phase 3 trial of YCANTH (VP-102) for the treatment of external genital warts.

We also intend to develop our product candidate, VP-315, for basal cell carcinoma and potentially additional dermatological oncology indications.

The FDA accepted our investigational new drug application in November 2021.

In April 2022, we dosed the first patient in Part 1 of a three-part Phase 2, multicenter, open-label, dose-escalation proof-of-concept trial with a safety run-in designed to assess the safety, pharmacokinetics, and efficacy in subjects with biopsy proven basal cell carcinoma, or BCC.

BCC is the most common form of cancer in the United States, and incidence is rising worldwide.

There are approximately 3.6 million diagnoses of BCCs in the United States each year, with a high unmet need for new treatment options.

More than one out of every three new cancers are skin cancers, and the vast majority are BCCs.

In 2021, the estimated global BCC market was $6.7 billion, which is expected to grow to $11.5 billion in 2028.

Mohs micrographic surgery is considered the most effective technique for treating BCCs with over 700,000 procedures in the United States annually.

We believe VP-315 has the potential to be a non-surgical alternative for the treatment of BCC.

In Part 1 of the trial, VP-315 demonstrated a favorable safety and tolerability profile with no reported serious adverse events.

We initiated Part 2 of the trial in April 2023.

In June 2023, the protocol was amended to remove Part 3 of the trial and to expand Part 2.

The trial enrolled 92 adult subjects with a histological diagnosis of basal cell carcinoma in at least one eligible target lesion.

The last patient in Part 2 of the trial was dosed in December 2023.

We announced preliminary positive results in August 2024 based on 93 confirmed basal cell carcinoma lesions that were treated during Part 2 of the trial;

however, for histologic reduction in tumor size and overall reduction in tumor size, data from three of the 93 lesions are pending.

Based on the preliminary results, VP-315 was well tolerated with no reported treatment-related serious adverse events or dose-limiting toxicities (n=93).

Most treatment-related adverse events were mild to moderate cutaneous reactions.

The overall reduction in tumor size of 90 of the lesions treated in Part 2 of the trial was approximately 86%.

Approximately 51% of all lesions treated in Part 2 of the trial achieved complete histological clearance, with no residual tumor cells (n=93), and patients with residual tumor on average achieved an approximate 71% reduction in tumor size (n=90).We expect genomic and T-cell (immune response) data from the trial in the first quarter of 2025 and plan to request an End-of-Phase 2 meeting with the FDA to determine next steps for the development of VP-315 for the treatment of BCC in the first half of 2025.

In addition, we have conducted necessary drug development activities for VP-103, our second cantharidin-based product candidate, and are evaluating when to initiate a Phase 2 clinical trial for the treatment of plantar warts.

On October 1, 2024, we reduced our workforce by terminating 47 employees, or the Restructuring, to reduce costs and optimize the efficiency of our field sales force.

We will reduce the number of sales territories from 80 to approximately 33, with a focus on those territories that have historically shown a high prevalence of molluscum.

The Restructuring was completed on October 1, 2024.

In connection with the Restructuring, we expect to incur a one-time charge totaling approximately $0.6 million related to one-time employee termination costs In addition, we recognized an impairment charge for right-of-use assets associated with leased vehicles of $0.3 million during the three months ending September 30, 2024 in selling, general and administrative expenses for the three months ended September 30, 2024.

This restructuring charge will substantially be paid out by December 31, 2024.

We have built a specialized sales organization consisting of 35 employee sales representatives in the United States focused on pediatric dermatologists, dermatologists, and select pediatricians.

Additional Pipeline Products

YCANTH (VP-102) - Treatment of Common Warts

We also plan to advance YCANTH (VP-102) for common warts through a separate regulatory approval process and conduct a global phase three program with our partner, Torii.

We anticipate the program may begin as early as mid-2025.

In the future, we also intend to pursue commercialization for YCANTH (VP-102) for the treatment of molluscum contagiosum, as well as YCANTH (VP-102) for common warts if approved, in additional geographic regions, either alone or together with a strategic partner.

VP-315 - Treatment of Basal Cell Carcinoma

We are also developing VP-315 for the treatment of BCC and potentially additional dermatological oncology indications.

We held an end-of-Phase 2 meeting with the FDA in the first quarter and expect to report additional data in mid-2025, which we believe will help inform next steps for the advancement of the program into Phase 3 clinical trials.

Liquidity Overview

Since our inception in 2013, our operations have focused on developing YCANTH (VP-102), organizing and staffing our company, business planning, raising capital, establishing our intellectual property portfolio and conducting clinical trials.

We have funded our operations primarily through the sale of equity and equity-linked securities and through borrowings under loan agreements.

On July 26, 2023, we entered into a Credit Agreement with OrbiMed, or the Initial Lender, and each other lender that may from time to time become a party thereto, or the Lenders, pursuant to which we borrowed $50.0 million on July 26, 2023, resulting in net proceeds to us of approximately $44.1 million after payment of certain fees and transaction related expenses.

On July 26, 2023, we entered into a Credit Agreement, pursuant to which we borrowed $50.0 million under the Loan Facility (as defined in Note 10), resulting in net proceeds of approximately $44.1 million after payment of certain fees and transaction related expenses.

Amounts borrowed under the Loan Facility will mature on July 26, 2028.

Based on our net revenue attributable to YCANTH on a trailing 12-month basis not meeting a specified amount set forth in the Credit Agreement as of December 31, 2024, we became obligated to start making principal payments starting on January 1, 2025.

We are obligated to repay the principal amount of the loan on the last day of each month in equal monthly installments through the maturity date, together with the applicable repayment premium and the exit fee.

The Credit Agreement contains customary events of default, including, but not limited to, nonpayment of principal, interest, fees or other amounts;

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In addition, the Credit Agreement contains a financial covenant that we must maintain a liquidity of at least $10.0 million and that our quarterly and annual financial statements not be subject to any qualification or statement which is of a “going concern” or similar nature.

The qualification of a "going concern" was waived for the quarterly financial statements ended September 30, 2024.

The qualification of a "going concern" was waived for the annual financial statements for the year ended December 31, 2024 and quarterly financial statements for the quarter ended March 31, 2025.

If the qualification of a "going concern" is not waived for additional future periods or if additional financing is not raised to meet the liquidity test, we may be in default of the debt agreement in the near-term.

Upon the occurrence of an event of default (subject to notice and grace periods), additional interest of 4% per annum applies and obligations under the Credit Agreement could be accelerated.

As of September 30, 2024, we were in compliance with all covenants under the Credit Agreement as amended.

As part of the Loan Facility, we issued the Initial Lender a warrant to purchase up to 518,551 shares of our common stock, at an exercise price of $6.0264 per share, which have a term of 10 years from the issuance date.

In February 2023, we closed an underwritten offering of 750,000 shares of our common stock and pre-funded warrants to purchase 4,064,814 shares of common stock, of which 2.583,333 were exercised were exercised resulting in net shares issued of 2,583,242 during the three-month period ended September 30, 2024.

The shares of common stock were sold in the underwritten offering at a price of $6.75 per share and the pre-funded warrants were sold at a price of $6.7499 per pre-funded warrant, resulting in total net proceeds of $30.3 million, after deducting underwriting discounts and commissions, and offering expenses.

Since inception, we have incurred significant operating losses.

For the nine months ended September 30, 2024 and 2023, our net loss was $60.4 million and $42.4 million, respectively.

The increase in loss is primarily due to significant commercial expenditures to support the launch and future growth of YCANTH (VP-102) compounded by slower than expected revenue growth.

As of September 30, 2024, we had an accumulated deficit of $290.8 million.

As of March 31, 2025, we were in compliance with all covenants under the Credit Agreement as amended.

In November 2024, we closed an underwritten offering of 45,518,243 shares of our common stock (and, in lieu of common stock to certain investors that so chose, pre-funded warrants to purchase 2,235,955 shares of our common stock, or the pre-funded warrants), and in either case, accompanying Series A warrants to purchase 23,877,099 shares of our common stock at an exercise price of $1.0680 per share of common stock, or the Series A Warrants, and Series B warrants to purchase 23,877,099 shares of our common stock at an exercise price of $1.3350 per share of common stock, or the Series B Warrants, at a combined public offering price of $0.89 per share of common stock and accompanying Series A and Series B Warrants (or $0.8899 per Pre-Funded Warrant and accompanying Series A and Series B Warrants).

The offering resulted in net proceeds of $39.6 million, after deducting underwriting discounts and commissions, and offering expenses.

As of March 31, 2025 , we had cash and cash equivalents of $29.6 million.

Based on our current business plan and current capital resources, combined with the uncertainty regarding the availability of additional funding and considering our debt obligations, including a requirement to maintain cash, cash equivalents and investments of at least $10.0 million at all times, we have concluded that there is substantial doubt regarding our ability to continue as a going concern within one year after the date these financial statements are issued.

We have incurred substantial operating losses since inception and expect to continue to incur significant losses for the foreseeable future and may never become profitable.

As of March 31, 2025, we had an accumulated deficit of $316.8 million.

Our financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result should we be unable to continue as a going concern.

We plan to secure additional capital in the future through equity or debt financings, partnerships, or other sources to carry out our planned commercial and development activities.

If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate continued and future commercialization efforts and/or research and development programs.

We expect to continue to incur significant expenses and operating losses for the foreseeable future.

We anticipate that our expenses may increase significantly in connection with our ongoing activities, as we:

• continue commercialization of YCANTH (VP-102) for the treatment of molluscum contagiosum;

• continue our ongoing clinical program evaluating VP-315 for the treatment of basal cell carcinoma and potentially additional dermatological oncology indications;

• continue our ongoing clinical programs evaluating YCANTH (VP-102) for the treatment of common warts and external genital warts, as well as initiate and complete additional clinical trials, as needed;

• initiate clinical trials evaluating VP-103 for the treatment of plantar warts;

• pursue regulatory approvals for YCANTH (VP-102) for the treatment of common warts, external genital warts, or any other indications we may pursue for YCANTH (VP-102), VP-315 or VP -103;

• seek to discover and develop additional product candidates;

• further establish a commercialization infrastructure and scale up external manufacturing and distribution capabilities to commercialize YCANTH (VP-102) for the treatment of molluscum contagiosum and any other product candidates for which we may obtain regulatory approval, including YCANTH for external genital warts and common warts, VP- 315 and VP-103;

• seek to in-license or acquire additional product candidates for other dermatological conditions;

Our expenses may increase in connection with our ongoing activities, as we:

continue to establish our commercialization infrastructure and scale up external manufacturing and distribution capabilities to commercialize YCANTH (VP-102) for the treatment of molluscum contagiosum and product candidates for which we may obtain regulatory approval;

• continue our ongoing clinical programs evaluating VP-102 for the treatment of common warts and VP-315 for the treatment of BCC and potentially additional dermatological oncology indications;

• pursue regulatory approvals for YCANTH (VP-102) for the treatment of common warts and VP-315 for the treatment of BCC;

• adapt our regulatory compliance efforts to incorporate requirements applicable to marketed products;

• maintain, expand and protect our intellectual property portfolio;

• hire additional commercial, administrative, clinical, manufacturing and scientific personnel;

• add operational, financial and management information systems and personnel, including personnel to support our product development and planned commercialization efforts;

• hire and retain clinical, manufacturing, commercialization and scientific personnel;

• incur additional legal, accounting and other expenses while operating as a public company.

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Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with U.S.

The preparation of these financial statements requires us to

make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities as of the dates of the balance sheets and the reported amounts of expenses during the reporting periods.

The preparation of these financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities as of the dates of the balance sheets and the reported amounts of expenses during the reporting periods.

In accordance with GAAP, we evaluate our estimates and judgments on an ongoing basis.

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YCANTH (VP-102) became available for commercial sale and shipment for the treatment of patients by a healthcare provider in the United States in the year ended December 31, 2023.

We sell the Product to several pharmaceutical wholesaler/distributors, or the Customers, who in turn sell the Product directly to clinics, hospitals, and federal healthcare programs.

We sell the Product to several pharmaceutical wholesalers and distributors, or the Customers, who in turn sell the Product directly to clinics, hospitals, and federal healthcare programs.

Revenue is recognized as the Product is physically delivered to the Customers.

Gross product sales are reduced by corresponding gross-to-net, or GTN, estimates using the expected value method, resulting in our reported “Product revenue, net” in the accompanying statements of operations.

Product revenue, net reflects the amount we ultimately expect to realize in net cash proceeds, taking into account the current period gross sales and related cash receipts and the subsequent cash disbursements on these sales that we estimate for the various GTN categories as well as adjustments for any potential future product returns from distributors.

The GTN estimates are based upon information received from external sources, such as written or oral information obtained from our customers with respect to their period-end inventory levels and sales to end-users during the period, in combination with management’s informed judgments.

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Variance between actual amounts and estimated amounts may result in prospective adjustments to reported net product revenue.

YCANTH (VP-102) may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success .

Collaboration Revenue

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Operating Expenses

Cost of Product Revenue

Cost of product revenue includes the cost of inventory sold, which includes direct manufacturing and supply chain costs.

Prior to FDA approval, all product purchased from such suppliers was included as a component of research and development expense, as we were unable to assert that the inventory had future economic benefit until YCANTH (VP-102) received FDA approval.

Pursuant to the supply agreement, we purchased and included in research and development expenses approximately $4.5 million of raw cantharidin and processed active pharmaceutical ingredient, or API.

The raw cantharidin and processed API is sufficient to produce approximately 14 million finished drug product applicators to be used for commercially saleable product and other YCANTH (VP-102) product candidates.

In addition, we purchased other components and services related to YCANTH (VP-102) for commercially saleable product and included approximately $1.2 million in research and development expenses prior to FDA approval.

As a result, cost of product revenue related to YCANTH (VP-102) will initially reflect a lower average per unit cost of materials over approximately the next year as previously expensed inventory is utilized for commercial production and sold to customers.

If we included those costs previously expensed as a component of cost of product revenue, our cost of product revenue for each of the three months ended March 31, 2025 and 2024 would have been $0.7 million, including $0.3 million of obsolete inventory costs in both periods.

March 31, 2025, the amount remaining related to previously expensed inventory would have an immaterial impact in future periods and will no longer be reported as a component of cost of product revenue.

Cost of Collaboration Revenue

The costs of collaboration revenue consists of payments for manufacturing supply to support development and testing services pursuant to the Torii Clinical Supply Agreement.

Selling, General and Administrative Expenses

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Other selling, general and administrative expenses include cost of samples, sponsorships, consumer and health care professional marketing and advertising expense, insurance costs, and professional fees for audit, tax and legal services.

We anticipate that our selling, general and administrative expenses, including payroll and related expenses, will change in the future due to the Restructuring and as we continue to evaluate our headcount to support the expected growth in our business, modify our operations and organizational capabilities, and continue to commercialize YCANTH (VP-102).

We also anticipate increased expenses associated with general operations, including costs related to audit, tax and legal services, director and officer insurance premiums, and investor relations costs.

Research and Development Expenses

Research and development expenses consist of expenses incurred in connection with the discovery and development of YCANTH (VP-102) for the treatment of molluscum contagiosum, potential follow-on indications for YCANTH (VP-102), including common warts and external genital warts, VP-315, and our other product candidates.

Research and development expenses consist of expenses incurred in connection with the discovery and development of YCANTH (VP-102) for the treatment of molluscum contagiosum, potential follow-on indications for YCANTH (VP-102), including common warts, and our other product candidates in addition to VP-315 for BCC.

We expense research and development costs as incurred.

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Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials.

We expect our research and development expenses to increase over the next several years as we increase personnel costs, including stock-based compensation, initiate and conduct clinical trials of YCANTH (VP-102) in patients with common warts, YCANTH (VP-102) in patients with external genital warts, VP-315 for basal cell carcinoma and potentially additional dermatological oncology indications,VP-103 in patients with plantar warts, and conduct other clinical trials and prepare regulatory filings for our product candidates.

We expect our research and development expenses to increase over the next several years as we increase personnel costs, including stock-based compensation, initiate and conduct clinical trials of YCANTH (VP-102) in patients with common warts and VP-315 for BCC and potentially additional dermatological oncology indications and prepare regulatory filings for our product candidates.

The successful development of our product candidates is highly uncertain.

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A change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate.

For example, if the FDA or other regulatory authorities were to require us to conduct clinical trials beyond those that we currently anticipate, or if we experience significant delays in enrollment in any of our clinical trials, we could be required to expend significant additional financial resources and time on the completion of clinical development.

Cost of Product Revenue

Cost of product revenue includes the cost of inventory sold, which includes direct manufacturing and supply chain costs.

We purchased and included in research and development expenses approximately $4.5 million of raw cantharidin and processed active pharmaceutical ingredient, or API.

The raw cantharidin and processed API is sufficient to produce approximately 14 million finished drug product applicators to be used for commercially saleable product and other product candidates.

As a result, cost of product revenue related to YCANTH (VP-102) will initially reflect a lower average per unit cost of materials over approximately the next six months as previously expensed inventory is utilized for commercial production and sold to customers.

If we included those costs previously expensed as a component of cost of product revenue, our cost of product revenue for three and nine months ended September 30, 2024 would have been $0.4 million and $1.8 million, respectively.

Cost of Collaboration Revenue

The costs of collaboration revenue consists of payments for manufacturing supply to support development and testing services pursuant to the Torii Clinical Supply Agreement.

Results of Operations for the Three Months Ended September 30, 2024 and 2023

The following table summarizes our results of operations for the three months ended September 30, 2024 and 2023 (in thousands):

For the Three Months Ended September 30,

For example, if the FDA or other regulatory

authorities were to require us to conduct clinical trials beyond those that we currently anticipate, or if we experience significant delays in enrollment in any of our clinical trials, we could be required to expend significant additional financial resources and time on the completion of clinical development.

Results of Operations for the Three Months Ended March 31, 2025 and 2024

The following table summarizes our results of operations (in thousands):

For the Three Months Ended March 31,

Total revenue

Product revenue, net

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Operating expenses:

Selling, general and administrative

Research and development

Cost of product revenue

Cost of collaboration revenue

Total operating expenses

Loss from operations

Other income (expense):

Interest income

Interest expense

Other expense

Total other (expense) income, net

Product Revenue, Net

Product revenue, net was negative $1.9 million for the three months ended September 30, 2024 compared to $2.8 million for the three months ended September 30, 2023.

Negative revenue during the three months ended September 30, 2024 was due to an increase in our returns reserve of $1.7 million for estimated returns from certain distributors.

We determined it was more than probable that product held by certain distributors will be returned based on lower than forecasted sell-through and expiration of product.

This increase in reserve was in addition to an adjustment of other gross to net reserves of $0.2 million mostly related to increase in co-pay reserve.

We will continue to work with all of our distributors to sell through existing inventory and expand target channels of sales and distribution.

Reserves will continue to be reviewed on a quarterly basis and may be adjusted based on assessment of the overall business and sales forecast by each distributor.

There were no ex-factory sales for the three months ended September 30, 2024 due to lower demand pull through.

YCANTH (VP-102), our first FDA approved product, became available for commercial sale in August 2023.

Revenue generated during the three months ending September 30, 2023 relates to the delivery of YCANTH (VP-102) to FFF, our sole distributor during this period.

Collaboration Revenue

Collaboration revenue was $0.1 million for each of the three months ended September 30, 2024 and 2023.

During each of the three months ended September 30, 2024 and 2023, collaboration revenue consisted of supplies and development activity with Torii.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were $16.1 million for the three months ended September 30, 2024, compared to $20.1 million for the three months ended September 30, 2023.

The decrease of $4.1 million was primarily due to a decrease in stock compensation of $7.0 million due to restricted stock units vested on FDA approval in July 2023 and a decrease in advertising costs of $1.0 million partially offset by increased compensation, and benefits and travel due to ramp-up of sales force of $1.6 million, an increase in medical affairs costs in selling, general and administrative expenses of $0.7 million, severance of $0.4 million, increased legal costs of $0.4 million and loss on disposal of assets of $0.3 million.

Research and Development Expenses

Research and development expenses were $2.4 million for the three months ended September 30, 2024, compared to $6.5 million for the three months ended September 30, 2023.

The decrease of $4.1 million was primarily related to decrease in VP-315 clinical trial costs of $2.5 million, a decrease of medical affairs costs in research and development expenses of $0.7 million, decrease of stock compensation of $0.6 million related to restricted stock units vested on FDA approval in July 2023 and a reduction of costs related to YCANTH (VP-102) pre-launch activity of $0.5 million partially offset by increased headcount related costs of $0.3 million.

The following table summarizes our research and development expense by product candidate or, for unallocated expenses, by type, for the three months ended September 30, 2024 and 2023.

We did not incur any research and development expense for VP-103 during the three months ended September 30, 2024 or 2023.

Unallocated expenses include compensation and other personnel related costs.

For the Three Months Ended

September 30,

YCANTH (VP-102)

Common Warts (VP-102)

Stock based compensation

Other unallocated expenses

Research and development expense

Cost of Product Revenue

Cost of product revenue of $0.4 million for the three months ended September 30, 2024 consisted of obsolete inventory write-off of $0.3 million and $0.1 million of indirect overhead labor and product testing costs.

YCANTH (VP-102), our first FDA approved product, became available for commercial sale in August 2023.

Cost of product revenue for the three months ended September 30, 2023 was $0.1 million related to indirect overhead labor costs.

All product costs had previously been expensed prior to FDA approval of YCANTH (VP-102) for the treatment of molluscum.

Cost of Collaboration Revenue

Cost of collaboration revenue was $0.1 million for each of the three months ended September 30, 2024 and 2023.

The costs were related to manufacturing supply required to support development and testing services pursuant to the Torii Clinical Supply Agreement.

Interest Income

Interest income was $0.2 million for the three months ended September 30, 2024 compared to $0.8 million for the three months ended September 30, 2023.

The decrease of $0.6 million was primarily due to lower cash balance for the period ended September 30, 2024.

Interest Expense

Interest expense was $2.4 million for the three months ended September 30, 2024 compared to $1.7 million for the three months ended September 30, 2023.

The higher interest expense of $0.7 million was due to the OrbiMed Credit Agreement commencement on July 26, 2023.

Results of Operations for the Nine Months Ended September 30, 2024 and 2023

The following table summarizes our results of operations for the nine months ended September 30, 2024 and 2023 (in thousands):

For the Nine Months Ended September 30,

Product revenue, net

Collaboration revenue

Total revenue

Operating expenses:

Selling, general and administrative

Research and development

Cost of product revenue

Cost of collaboration revenue

Total operating expenses

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Interest expense

Change in fair value of derivative liability

Other expense

Total other (expense) income, net

Total other expense, net

Product Revenue, Net

Product revenue, net was $6.3 million for the nine months ended September 30, 2024 compared to $2.8 million for the nine months ended September 30, 2023.

YCANTH (VP-102), our first FDA approved product, became available for commercial sale in August 2023.

The increase of $3.5 million relates to additional sales of YCANTH (VP-102) to FFF, our primary distributor, related to forecasted demand pull through, as well as the expansion of our specialty distribution network during the three-month period ended June 30, 2024 to bring-on an additional specialty distributor and the related impact of an initial one-time stock-in order from that distributor.

Revenue during the nine months ended September 30, 2024 was partially offset by an increase in our returns reserve of $1.7 million for estimated returns from our distributors.

We determined it was more than probable that product held by certain distributors will be returned based on our lower than forecasted sell-through and expiration of product.

We will continue to work with all of our distributors to sell through existing inventory and expand target channels of sales and distribution.

Reserves will continue to be reviewed on a quarterly basis and may be adjusted based on assessment of the overall business and sales forecast by each distributor.

Product revenue, net was $3.4 million for the three months ended March 31, 2025, compared to $3.2 million for the three months ended March 31, 2024.

Product revenue, net, related to the delivery of YCANTH (VP-102) to our distribution partners.

Collaboration Revenue

Collaboration revenue was $1.0 million for the nine months ended September 30, 2024, compared to $0.3 million for the nine months ended September 30, 2023 which consisted of supplies and development activity with Torii for each period.

Collaboration revenue was $17,000 for the three months ended March 31, 2025, compared to $0.6 million for the three months ended March 31, 2024.

Collaboration revenue for each of the three months ended March 31, 2025 and 2024 consisted of supplies and development activity with Torii.

Cost of Product Revenue

Cost of product revenue for the three months ended March 31, 2025 and 2024 was $0.4 million and $0.5 million, respectively, consisting of product costs related to the sale of YCANTH (VP-102) and obsolete inventory write-off of $47,000 and $0.3 million, respectively.

Cost of Collaboration Revenue

Cost of collaboration revenue was $14,000 for the three months ended March 31, 2025, compared to $0.6 million for the three months ended March 31, 2024.

The decrease of $0.6 million was primarily due to decreased manufacturing supply required to support development and testing services pursuant to the Torii Clinical Supply Agreement.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were $48.9 million for the nine months ended September 30, 2024, compared to $30.3 million for the nine months ended September 30, 2023.

The increase of $18.6 million was primarily due to higher expenses related to commercial activities for YCANTH (VP-102), including increased compensation, recruiting fees, benefits and travel due to ramp-up of sales force of $13.8 million, increased marketing and sponsorship costs of $2.5 million, increase in other commercial activity of $3.3 million, increased legal costs of $1.3 million, severance costs of $0.5 million, Dormer legal settlement of $0.8 million, an increase in medical affairs costs of $0.7 million in selling, general and administrative expenses and increased finance costs of $0.6 million partially offset by decrease in stock compensation costs of $5.0 million due to restricted stock units vested on FDA approval in July 2023.

Selling, general and administrative expenses were $8.8 million for the three months ended March 31, 2025, compared to $16.3 million for the three months ended March 31, 2024.

The decrease of $7.5 million was primarily due to lower expenses related to commercial activities for YCANTH (VP-102), including decreases in compensation, stock compensation, recruiting fees, benefits and travel due to reduced sales force of $4.4 million, decreased marketing and sponsorship costs of $2.1 million and other commercial activity of $0.4 million, and decreased legal costs of $0.7 million.

Research and Development Expenses

Research and development expenses were $10.7 million for the nine months ended September 30, 2024 compared to $15.0 million for the nine months ended September 30, 2023.

The decrease of $4.3 million was primarily due to a reduction of costs related to YCANTH (VP-102) pre-launch activity of $3.2 million, a decrease in clinical trial costs for VP-315 of $0.9 million, a decrease in medical affairs costs in research and development of $0.7 million, and decrease of stock compensation of $0.6 million related to restricted stock units vested on FDA approval in July 2023 partially offset by increased headcount related costs of $1.1 million.

The following table summarizes our research and development expense by product candidate or, for unallocated expenses, by type for the nine months ended September 30, 2024 and 2023.

We did not incur any research and development expense for VP-103

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

Unallocated expenses include compensation and other personnel related costs.

For the Nine Months Ended September 30,

Research and development expenses were $2.3 million for the three months ended March 31, 2025, compared to $4.9 million for the three months ended March 31, 2024.

The decrease of $2.6 million was primarily related to decreased clinical trial costs for VP-315 of $2.1 million and decreased regulatory and medical affairs costs of $0.4 million.

The following table summarizes our research and development expense by product candidate or, for unallocated expenses, by type, for the three months ended March 31, 2025 and 2024.

Unallocated expenses include compensation and other personnel-related costs (in thousands):

For the Three Months Ended

YCANTH (VP-102)

Common Warts (VP-102)

Stock based compensation

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Research and development expense

Cost of Product Revenue

Cost of product revenue was $1.3 million for the nine months ended September 30, 2024 compared to $0.1 million for the nine months ended September 30, 2023.

The increase of $1.2 million was related to additional product sales and obsolete inventory write-off of $0.6 million during the nine months ended September 30, 2024.

Cost of Collaboration Revenue

Cost of collaboration revenue was $0.9 million for the nine months ended September 30, 2024, compared to $0.3 million for the nine months ended September 30, 2023.

The increase of $0.5 million was primarily due to increased manufacturing supply required to support development and testing services pursuant to the Torii Clinical Supply Agreement.

Interest Income

Interest income was $1.2 million for the nine months ended September 30, 2024 compared to $1.9 million for the nine months ended September 30, 2023.

The decrease of $0.7 million was primarily due to lower cash as of September 30, 2024.

Interest income was $0.3 million for the three months ended March 31, 2025 compared to $0.6 million for the three months ended March 31, 2024.

The decrease of $0.3 million was primarily due to a lower cash balance.

Interest Expense

Interest expense was $7.1 million for the nine months ended September 30, 2024 compared to $1.7 million for the nine months ended September 30, 2023.

The higher interest expense of $5.4 million was due to the OrbiMed Credit Agreement commencement on July 26, 2023.

Interest expense was $2.2 million for the three months ended March 31, 2025 compared to $2.3 million for the three months ended March 31, 2024 and consisted of interest expense on the OrbiMed Credit Agreement as described in Note 10 to our financial statements for each period.

The decrease of $0.1 million was related to a lower outstanding principal balance under our Credit Agreement with OrbiMed.

Liquidity and Capital Resources

Since our inception, we have incurred net losses and negative cash flows from our operations.

We have financed our operations since inception primarily through sales of our convertible preferred stock, the sale of our common stock, the issuance of debt and $20.0 million from the Torii Agreement.

As of September 30, 2024, we had cash and cash equivalents of $23.0 million.

Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view to liquidity and capital preservation.

On July 21, 2023, the FDA approved YCANTH (VP-102) topical solution for the treatment of molluscum contagiosum in adult and pediatric patients two years of age and older.

Our first commercial sale of YCANTH (VP-102) occurred in August 2023 to FFF, our primary specialty pharmacy distributor.

On July 26, 2023, we entered into the Credit Agreement, pursuant to which we borrowed $50.0 million on July 26, 2023, resulting in net proceeds to us of approximately $44.1 million after payment of certain fees and transaction related expenses.

We have financed our operations since inception primarily through sales of our convertible preferred stock, the sale of our common stock, and $20.0 million from the Torii Agreement.

In November 2024, we closed an underwritten offering of 45,518,243 shares of our common stock and, in lieu of common stock to certain investors that so chose, pre-funded warrants to purchase 2,235,955 shares of our common stock, and in either case, accompanying Series A Warrants to purchase 23,877,099 shares of our common stock at an exercise price of $1.0680 per share of common stock and Series B Warrants to purchase 23,877,099 shares of our common stock at an exercise price of $1.3350 per share of common stock, at a combined public offering price of $0.89 per share of common stock and accompanying Series A and Series B Warrants (or $0.8899 per Pre-Funded Warrant and accompanying Series A and Series B Warrants).

The offering resulted in net proceeds of $39.6 million, after deducting underwriting discounts and commissions, and offering expenses.

As of March 31, 2025, we had cash and cash equivalents of $29.6 million.

On July 21, 2023, the F DA a pproved YCANTH (VP-102) topical solution for the treatment of molluscum contagiosum in adult and pediatric patients two years of age and older.

Our first commercial sale of YCANTH (VP-102) occurred in August 2023.

On July 26, 2023, we entered into the Credit Agreement under which we borrowed $50.0 million, resulting in net proceeds to us of approximately $44.1 million after payment of certain fees and transaction related expenses.

Amounts borrowed under the Loan Facility will mature on July 26, 2028.

Payments of the principal amount of borrowings under the Credit Agreement, together with a repayment premium and other fees, are not required under the Credit Agreement unless our net revenue attributable to YCANTH on a trailing 12-month basis does not equal or exceed specified amounts for specified test periods as set forth in the Credit Agreement beginning on December 31, 2024.

If, on a test date, we do not achieve the specified amount of revenue on a trailing 12-month basis, then, beginning on the last day of the next full month immediately following the such test date, we would be required to repay the outstanding principal amount of the loans on the last day of each month in equal monthly installments through the maturity date, together with the applicable repayment premium and the exit fee.

If we do not achieve the specified amount of revenue on a trailing 12-month basis to meet the revenue test requirements as of December 31, 2024, we would begin making principal payments on the outstanding debt balance starting in January 2025.

We do not anticipate meeting the revenue test as of December 31, 2024.

In addition, the Credit Agreement contains a financial covenant that we must maintain a liquidity of at least $10.0 million and if we are unable to maintain compliance by either amending the debt or raising additional funds, we could be in default in the near-term.

The Credit Agreement also requires that our quarterly and annual financial statements not be subject to any qualification or statement which is of a “going concern” or

similar nature.

The qualification of a "going concern" was waived for the quarterly financial statements ended September 30, 2024.

In addition, the Credit Agreement contains a financial covenant that we must maintain a liquidity of at least $10.0 million and also requires that our quarterly and annual financial statements not be subject to any qualification or statement which is of a “going concern” or similar nature.

The qualification of a "going concern" was waived for the annual financial statements for the year ended December 31, 2024 and quarterly financial statements for the quarter ended March 31, 2025.

If the qualification of a "going concern" is not waived for additional future periods or if we don’t raise additional financing, we may be in default of our debt in the near-term.

Upon the occurrence of an event of default (subject to notice and grace periods), additional interest of 4% per annum applies and obligations under the Credit Agreement could be accelerated.

As of September 30, 2024, the Company was in compliance with all covenants under the Credit Agreement as amended.

During the term of the Loan Facility, interest payable in cash by us will accrue on any outstanding balance due under the Loan Facility at a rate per annum equal to the higher of (x) the SOFR rate (which is the forward-looking term rate for a one-month tenor based on the secured overnight financing rate administered by the CME Group Benchmark Administration Limited) and (y) 4.00% plus, in either case, 8.00%.

During an event of default, any outstanding amount under the Loan Facility will bear interest at a rate of 4.00% in excess of the otherwise applicable rate of interest.

We will pay certain fees with respect to the Loan Facility, including an upfront fee, an unused fee on the undrawn portion of the Loan Facility, an administration fee, a prepayment premium and an exit fee, as well as certain other fees and expenses of the Administrative Agent and the Lenders.

The following table summarizes our cash flows for the nine months ended September 30, 2024 and 2023 (in thousands):

For the Nine Months Ended September 30,

During the term of the Credit Agreement, interest payable in cash by us will accrue on any outstanding balance due under the Credit Agreement at a rate per annum equal to the higher of (x) the SOFR rate (which is the forward-looking term rate for a one-month tenor based on the secured overnight financing rate administered by the CME Group Benchmark Administration Limited) and (y) 4.00% plus, in either case, 8.00%.

During an event of default, any outstanding amount under the Credit Agreement will bear interest at a rate of 4.00% in excess of the otherwise applicable rate of interest.

We will pay certain fees with respect to the Credit Agreement, including an upfront fee, an unused fee on the undrawn portion of the Credit Agreement, an administration fee, a prepayment premium and an exit fee, as well as certain other fees and expenses of the Administrative Agent and the Lenders.

The following table summarizes our cash flows (in thousands):

For the Three Months Ended March 31,

Net cash used in operating activities

Net cash used in investing activities

Net cash (used in) provided by financing activities

Net (decrease) increase in cash and cash equivalents

Net cash used in financing activities

Net decrease in cash and cash equivalents

Operating Activities

During the nine months ended September 30, 2024, operating activities used $44.9 million of cash, primarily resulting from a net loss of $60.4 million partially offset by non-cash stock-based compensation of $6.4 million, non-cash amortization and impairment of right-of-use assets of $0.9 and non-cash interest expense of $1.6 million.

Net cash used by changes in operating assets and liabilities consisted primarily of an increase in prepaid expenses and other assets of $1.5 and a decrease in accounts payable of $1.5 million partially offset by decreases in accounts receivable of $4.4 million and a net increase in accrued expenses of $4.9 million.

During the nine months ended September 30, 2023, operating activities used $24.1 million of cash, primarily resulting from a net loss of $42.4 million partially offset by non-cash stock-based compensation of $12.3 million.

Net cash provided by changes in operating assets and liabilities consisted primarily of a decrease in prepaid and other assets of $1.0 million and an increase in accounts payable and accrued expenses of $7.8 million partially offset by an increase in accounts receivable of $3.9 million.

During the three months ended March 31, 2025, operating activities used $12.7 million of cash, primarily resulting from a net loss of $9.7 million partially offset by non-cash stock-based compensation of $1.0 million and noncash interest of $0.7 million.

Net cash used by changes in operating assets and liabilities consisted primarily of an increase in accounts receivable of $5.6 million partially offset by an increase in accrued expenses of $1.0 million and a decrease in prepaid expenses and other assets of $0.6 million.

During the three months ended March 31, 2024, operating activities used $19.9 million of cash, primarily resulting from a net loss of $20.3 million partially offset by non-cash stock-based compensation of $2.1 million.

Net cash used by changes in operating assets and liabilities consisted primarily of increases in accounts receivable of $2.8 million and prepaid expenses and other assets of $1.3 million partially offset by an increase in accrued expenses of $1.7 million.

Investing Activities

During the nine months ended September 30, 2024 and 2023, net cash used in investing activities of $27,000 and $135,000, respectively, was for the purchase of property and equipment.

During the three months ended March 31, 2025 and 2024, no cash was used in or provided by investing activities.

Financing Activities

During the nine months ended September 30, 2024, net cash used by financing activities of $1.7 million was primarily due to $1.1 million of debt amendment costs related to the OrbiMed Credit Agreement and finance lease payments of $0.6 million.

During the nine months ended September 30, 2023, net cash provided by financing activities of $74.2 million was primarily related to net cash proceeds of $44.1 million from the OrbiMed Credit Agreement and proceeds of $30.3 million, net of issuance costs from the issuance of common stock and pre-funded warrants.

During the three months ended March 31, 2025, net cash used by financing activities of $4.1 million was primarily due to the repayment of debt related to the Credit Agreement.

During the three months ended March 31, 2024, net cash used by financing activities of $0.7 million was primarily due to $0.5 million of debt amendment costs paid related to the Credit Agreement.

Funding Requirements

Our first commercial sale of YCANTH (VP-102) occurred in August 2023 to FFF, our primary specialty pharmacy distributor.

While we expect to continue to generate revenue from the sale of YCANTH (VP-102), we expect our expenses to increase in connection with our ongoing activities, particularly as we continue commercialization of YCANTH (VP-102) and continue the research and development of, continue or initiate clinical trials of, and seek marketing approval for, our product candidates.

We expect to incur significant commercialization expenses related to sales, marketing, manufacturing and distribution.

Furthermore, we expect to incur additional costs associated with operating as a public company.

Our first commercial sale of YCANTH (VP-102) occurred in August 2023 to a specialty pharmacy distributor.

While we expect to continue to generate revenue from the sale of YCANTH (VP-102), our expenses may increase in connection with our ongoing activities, particularly as we continue the research and development of, continue or initiate clinical trials of, and seek marketing approval for, our product candidates.

We will need substantial additional financing to fund our operations.

If we are unable to raise capital when needed or on attractive terms, we would be forced to reduce operating expenses, delay, reduce or eliminate our research and development programs and/or continued and future commercialization efforts.

We believe that our existing cash and cash equivalents as of September 30, 2024 will be sufficient to support our planned operations only into the

first quarter of 2025.

These factors cause substantial doubt to exist about the Company's ability to continue as a going concern within one year after the date these financial statements are issued.

The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

In addition, the amount of proceeds we may be able to raise pursuant to our currently effective shelf registration statement on Form S-3 is limited.

We are subject to the general instructions of Form S-3 known as the "baby shelf rules." Under these rules, the amount of funds we can raise through primary public offerings of securities in any 12-month period using our registration statement on Form S-3 is limited to one-third of the aggregate market value of the shares of our common stock held by non-affiliates.

Therefore, we will be limited in the amount of proceeds we are able to raise by selling securities using our Form S-3 until such time as our public float exceeds $75.0 million.

We have incurred substantial operating losses since inception and expect to continue to incur significant losses for the foreseeable future and may never become profitable.

As of March 31, 2025, we had an accumulated deficit of $316.8 million.

We believe our cash, and cash equivalents of $29.6 million as of March 31, 2025 will be sufficient to support our planned operations into the third quarter of 2025.

Based on our current business plan and current capital resources, combined with the uncertainty regarding the availability of additional funding and considering our debt obligations, including a requirement to maintain cash, cash equivalents and investments of at least $10.0 million at all times, we have concluded there is substantial doubt regarding our ability to continue as a going concern within one year after the date these financial statements are issued.

We plan to address the conditions that raise

substantial doubt regarding our ability to continue as a going concern by, among other things, obtaining additional funding through equity offerings, debt financing and refinancings, collaborations, strategic alliances and/or licensing arrangements.

While beyond our control, the milestone payment of $8.0 million due from Torii upon the first patient dosed in Japan in the Phase 3 program, and/or the exercise of the Series A Warrants issued in conjunction with the November 2024 Equity Financing, which have an exercise price of $1.0680 per share and expire in November 2025 may result in additional liquidity during 2025 and alleviate the substantial doubt regarding our ability to continue as a going concern.

We cannot predict with certainty that these funds will be received and alleviate the substantial doubt.

Our financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our capital resources sooner than we expect.

Our future capital requirements will depend on many factors, including:

Our future capital requirements, and timing, will depend on many factors, including:

• our ability to maintain compliance with our covenants under our Credit Agreement;

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Contractual Obligations and Commitments

As of September 30, 2024, there have been no material changes to our contractual obligations and commitments as previously discussed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

As of March 31, 2025, there have been no material changes to our contractual obligations and commitments as previously discussed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Quantitative and Qualitati ve Disclosures About Market Risks

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What changed 10-Q

Item 2. Management’s Discussion and Analysis