Aptinyx Inc. [APTX] Filings

10-Q 1 aptx-20220930x10q.htm 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-38535

Aptinyx Inc.

(Exact name of registrant as specified in its charter)


Delaware		47-4626057
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

909 Davis Street, Suite 600

Evanston, IL 60201

(847) 871-0377

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	APTX	The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 2, 2022 the registrant had 67,715,718 shares of common stock, $0.01 par value per share, outstanding.

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		Page
PART I.	FINANCIAL INFORMATION	5
Item 1.	Condensed Financial Statements (unaudited)	5
	Balance Sheets	5
	Statements of Operations	6
	Statements of Cash Flows	7
	Statements of Stockholders’ Equity	8
	Notes to Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4.	Controls and Procedures	28
PART II.	OTHER INFORMATION	30
Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3.	Defaults Upon Senior Securities	31
Item 4.	Mine Safety Disclosures	31
Item 5.	Other Information	31
Item 6.	Exhibits	32
Signatures		33

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks, uncertainties, and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements. All statements, other than statements of historical facts, contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans and objectives of management and expected market growth are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “would,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

These forward-looking statements include, among other things, statements about:

●

the timing, progress, and results of preclinical studies and clinical trials for NYX-783, NYX-458, and any future product candidates we may develop, including statements regarding the timing of initiation, commencement, and completion of studies or trials and related preparatory work, and costs associated therewith, the period during which the results of the studies will become available, our research and development programs, and our ability to demonstrate safety and efficacy of our product candidates to the satisfaction of applicable regulatory authorities;

●

the impacts of the current COVID-19 pandemic on our continuing operations, clinical development plans, including the timing of initiation, recommencement and completion of studies or trials, financial forecasts and expectations, and other matters related to our business and operations;

●

the existence or absence of side effects or other properties relating to our product candidates that could delay or prevent their regulatory approval, limit their commercial potential, or result in significant negative consequences following any potential marketing approval;

●

the potential for our identified research priorities to advance our technologies;

●

our ability to establish or maintain future collaborations or strategic relationships or obtain additional funding in connection with these relationships;

●

our ability to obtain and maintain regulatory approval of our product candidates NYX-783, NYX-458, and any other future product candidates, and any statements regarding the label of an approved product candidate, including any restrictions, limitations, and/or warnings therein;

●

our intellectual property position, including the scope of protection we are able to establish and maintain for intellectual property rights covering NYX-783, NYX-458, and any additional product candidates we may develop, and any statements as to whether we do or do not infringe, misappropriate, or otherwise violate any third-party intellectual property rights;

●

our ability and the potential to successfully manufacture our product candidates for clinical studies and for commercial use, if approved;

●

our ability to commercialize our products in light of the intellectual property rights of others;

●

our ability to obtain funding for our operations, including funding necessary to complete further development and commercialization of our product candidates;

●

our plans to research, develop, and commercialize our product candidates;

●

our ability to retain and attract collaborators with research, development, regulatory, and commercialization expertise;

●

the size and growth potential of the markets for our product candidates and our ability to serve those markets;

●

the rate and degree of market acceptance and clinical utility of NYX-783, NYX-458, and any future product candidates we may develop, if approved;

●

the pricing and reimbursement of NYX-783, NYX-458, and any future product candidates we may develop, if approved;

●

regulatory developments in the United States and foreign countries;

●

our ability to contract with third-party suppliers and manufacturers and their ability to perform adequately;

●

the success of competing therapies that are or may become available;

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●

our ability to retain the continued service of our key professionals and to identify, hire, and retain additional qualified professionals;

●

the accuracy of our estimates regarding expenses, future revenue, capital requirements, and needs for additional financing;

●

our financial performance;

●

our expectations related to the use of our cash reserves;

●

the impact of laws and regulations, including, without limitation, recently enacted tax reform legislation;

●

our expectations regarding the time during which we will be an “emerging growth company” under the Jumpstart Our Business Startups Act;

●

our use of proceeds from our debt financing and our initial and follow-on public offerings; and

●

other risks and uncertainties, including those listed under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021, or Annual Report, and in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2022.

We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. We have included important factors in the cautionary statements included in this Quarterly Report on Form 10-Q and our Annual Report filed with the Securities and Exchange Commission, or the SEC, on March 23, 2022, particularly in the “Risk Factors” section, that could cause actual results or events to differ materially from the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, collaborations, joint ventures or investments that we may make or into which we may enter.

You should read this Quarterly Report on Form 10-Q and the documents that we reference herein and have filed or incorporated by reference as exhibits hereto completely and with the understanding that our actual future results may be materially different from what we expect. We do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

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PART I—FINANCIAL INFORMATION

Item 1. Condensed Financial Statements.

Aptinyx Inc.

Condensed Balance Sheets

(unaudited)

(in thousands, except per share data)


	September 30,		December 31,
	2022		2021
Assets
Current assets:
Cash and cash equivalents	$	66,584	$	106,124
Restricted cash		179		197
Prepaid expenses and other current assets		7,187		8,422
Total current assets		73,950		114,743
Other assets		2,219		—
Property and equipment, net		36		185
Total assets	$	76,205	$	114,928
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	474	$	622
Accrued expenses and other current liabilities		2,220		5,064
Total current liabilities		2,694		5,686
Term loan, non-current		24,709		14,155
Other long-term liabilities		10		331
Total liabilities	$	27,413	$	20,172
Commitments and contingencies (see Note 12)
Stockholders’ equity:
Preferred stock, $0.01 par value, 10,000 shares authorized and no shares issued and outstanding as of September 30, 2022 and December 31, 2021		—		—
Common stock, $0.01 par value, 150,000 shares authorized as of September 30, 2022 and December 31, 2021, 67,716 issued and outstanding as of September 30, 2022 and December 31, 2021		677		677
Additional paid-in capital		388,799		381,966
Accumulated deficit		(340,684)		(287,887)
Total stockholders’ equity	$	48,792	$	94,756
Total liabilities and stockholders’ equity	$	76,205	$	114,928

See accompanying notes to these unaudited condensed financial statements.

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Aptinyx Inc.

Condensed Statements of Operations

(unaudited)

(in thousands, except per share data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenues:
Collaboration revenue	$	—	$	—	$	—	$	1,000
Operating expenses:
Research and development		10,008		16,278		35,519		41,388
General and administrative		4,649		4,928		15,622		14,974
Total operating expenses		14,657		21,206		51,141		56,362
Loss from operations		(14,657)		(21,206)		(51,141)		(55,362)
Other (income) expense, net		(208)		(47)		(432)		(158)
Interest expense		854		72		2,088		72
Net loss and comprehensive loss	$	(15,303)	$	(21,231)	$	(52,797)	$	(55,276)
Net loss per share attributable to common stockholders, basic and diluted	$	(0.23)	$	(0.31)	$	(0.78)	$	(0.82)
Weighted-average number of common shares outstanding, basic and diluted		67,716		67,716		67,716		67,053

See accompanying notes to these unaudited condensed financial statements.

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Aptinyx Inc.

Condensed Statements of Cash Flows

(unaudited)

(in thousands)


	Nine Months Ended
	September 30,
	2022		2021
Cash flows from operating activities:
Net loss	$	(52,797)	$	(55,276)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense		119		488
Change in fair value of derivative liability associated with contingently issuable warrants		(115)		—
Non-cash interest expense related to term loan		562		19
Stock-based compensation expense		6,627		7,395
Changes in operating assets and liabilities:
Prepaid expenses and other assets		(754)		1,258
Accounts receivable		—		257
Accounts payable		(147)		1,818
Accrued expenses and other liabilities		(2,802)		(324)
Net cash used in operating activities		(49,307)		(44,365)
Cash flows from investing activities:
Proceeds from sale of property and equipment		—		122
Net cash provided by investing activities		—		122
Cash flows from financing activities:
Proceeds from stock options exercised		—		133
Repurchase of shares for tax withholdings		—		(912)
Proceeds from issuance of term loan, net of issuance costs paid to lender		10,000		14,638
Payment of debt issuance costs		(21)		(38)
Proceeds from at the market offering, net of sales commission		—		14,615
Payment of offering costs		(230)		(5)
Net cash provided by financing activities		9,749		28,431
Net decrease in cash, cash equivalents and restricted cash		(39,558)		(15,812)
Cash, cash equivalents and restricted cash, at beginning of period		106,321		141,299
Cash, cash equivalents and restricted cash, at end of period	$	66,763	$	125,487
Supplemental disclosure of cash flow information:
Cash paid for interest	$	1,415	$	—
Supplemental disclosure of non-cash investing and financing activities:
Deferred offering costs not yet paid	$	—	$	114
Debt issuance costs not yet paid		—		39
Recognition of derivative liability associated with contingently issuable warrants		—		287
Issuance of warrants in connection with term loan financing		206		255

See accompanying notes to these unaudited condensed financial statements.

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Aptinyx Inc.

Condensed Statements of Stockholders’ Equity

(unaudited)

(in thousands)


				Additional				Total
	Common stock			paid-in		Accumulated		stockholders’
	Shares	Amount		capital		deficit		equity
Balance at June 30, 2022	67,716	$	677	$	386,803	$	(325,381)	$	62,099
Stock‑based compensation	—		—		1,996		—		1,996
Net loss	—		—		—		(15,303)		(15,303)
Balance at September 30, 2022	67,716	$	677	$	388,799	$	(340,684)	$	48,792

Balance at June 30, 2021	67,716	$	677	$	377,125	$	(247,046)	$	130,756
Issuance of warrants in connection with term loan financing					255				255
Stock-based compensation	—		—		2,262		—		2,262
Net loss	—		—		—		(21,231)		(21,231)
Balance at September 30, 2021	67,716	$	677	$	379,642	$	(268,277)	$	112,042

				Additional				Total
	Common stock			paid-in		Accumulated		stockholders’
	Shares	Amount		capital		deficit		equity
Balance at December 31, 2021	67,716	$	677	$	381,966	$	(287,887)	$	94,756
Stock‑based compensation	—		—		6,627		—		6,627
Issuance of warrants in connection with term loan financing	—		—		206		—		206
Net loss	—		—		—		(52,797)		(52,797)
Balance at September 30, 2022	67,716	$	677	$	388,799	$	(340,684)	$	48,792

Balance at December 31, 2020	63,257	$	633	$	358,277	$	(213,001)	$	145,909
Issuance of common stock upon vesting of restricted stock	1,089		11		(11)		—		—
Repurchase of shares for tax withholdings	(347)		(3)		(909)		—		(912)
Issuance of warrants in connection with term loan financing	—		—		255		—		255
Issuance of common stock upon at the market offering, net of sales commissions and other offering costs of $529	3,630		36		14,502		—		14,538
Stock‑based compensation	—		—		7,395				7,395
Issuance of common stock upon exercise of stock options	87		—		133		—		133
Net loss	—		—		—		(55,276)		(55,276)
Balance at September 30, 2021	67,716	$	677	$	379,642	$	(268,277)	$	112,042

See accompanying notes to the unaudited condensed financial statements.

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Aptinyx Inc.

Notes to Condensed Financial Statements

(unaudited)

1. Organization

Description of business

Aptinyx Inc. (the “Company” or “Aptinyx”) was incorporated in Delaware on June 24, 2015, and maintains its headquarters in Evanston, Illinois.

Aptinyx is a clinical-stage biopharmaceutical company focused on the discovery, development, and commercialization of novel, proprietary, synthetic small molecules for the treatment of brain and nervous system disorders. Aptinyx has a platform for discovering proprietary compounds that work through a novel mechanism: modulation of N-methyl-D-aspartate receptors (“NMDAr”), which are vital to normal and effective brain and nervous system functions. This mechanism has applicability across numerous nervous system disorders.

Liquidity and capital resources

On July 1, 2019, the Company entered into a Sales Agreement (the “2019 Sales Agreement”) with Cowen and Company, LLC (“Cowen”) pursuant to which the Company may offer and sell shares of its common stock with an aggregate offering price of up to $50.0 million under an “at the market” offering program (the “2019 ATM Offering”). The 2019 Sales Agreement provides that Cowen will be entitled to a sales commission equal to 3.0% of the gross sales price per share of all shares sold under the 2019 ATM Offering. To date, the Company has sold an aggregate of 5,120,940 shares under the 2019 ATM Offering at a weighted-average price of $3.99 per share for net proceeds of $20.4 million after deducting sales commission and other offering expenses, including 3,629,458 shares for net proceeds of $14.5 million during the nine months ended September 30, 2021.

On September 15, 2021, the Company entered into a Loan and Security agreement (the “Loan Agreement”) with K2 HealthVentures LLC (“Lender”). The Loan Agreement provides up to $50.0 million principal in term loans, $15.0 million of which was funded at the time the Company entered into the agreement and $10.0 million of which was funded on March 14, 2022. See Note 7 for additional details regarding the Loan Agreement.

On September 16, 2021, the Company entered into a Sales Agreement (the “2021 Sales Agreement”) with Cowen pursuant to which the Company may offer and sell shares of its common stock with an aggregate offering price of up to $50.0 million under an “at the market” offering program (the “2021 ATM Offering”) and which supersedes the 2019 Sales Agreement and 2019 ATM Offering. The 2021 Sales Agreement provides that Cowen will be entitled to a sales commission equal to 3.0% of the gross sales price per share of all shares sold under the 2021 ATM Offering. As of the date of these financial statements, no shares of common stock have been issued and sold pursuant to the 2021 Sales Agreement.

On March 24, 2022, the Company entered into an amendment to the 2021 Sales Agreement (the “2022 Sales Agreement”) pursuant to which the Company may offer and sell shares of its common stock with an aggregate offering price of up to $75.0 million under an “at the market” offering program (the “2022 ATM Offering”) and which supersedes the 2021 Sales Agreement and 2021 ATM Offering. The 2022 Sales Agreement provides that Cowen will be entitled to a sales commission equal to 3.0% of the gross sales price per share of all shares sold under the 2022 ATM Offering. As of the date of these financial statements, no shares of common stock have been issued and sold pursuant to the 2022 Sales Agreement.

As of September 30, 2022, the Company had cash and cash equivalents of $66.6 million, which the Company believes will be sufficient to funds its planned operations for a period of at least twelve months from the date of issuance of these condensed financial statements.

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2.Summary of significant accounting policies

Basis of presentation

The condensed financial statements of the Company included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted from this report, as is permitted by such rules and regulations. The accompanying condensed financial statements reflect all adjustments consisting of normal, recurring adjustments that are necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. Interim results are not necessarily indicative of results for a full year. Accordingly, these condensed financial statements should be read in conjunction with the financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (the “Annual Report”) filed with the SEC on March 23, 2022.

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”), or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial statements upon adoption. Under the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”), the Company meets the definition of an emerging growth company, and has elected the extended transition period for complying with new or revised accounting standards, which delays the adoption of these accounting standards until they would apply to private companies.

Use of estimates

The condensed financial statements are prepared in conformity with GAAP. This process requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.

Risk and uncertainties

The Company’s future results of operations involve a number of risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of: the impact of COVID-19 on future clinical study results, the scope, timing, rate of progress, and expense of the Company’s ongoing as well as any additional preclinical studies, clinical studies, and other research and development activities, clinical study enrollment rate or design, the manufacturing of the Company’s product candidates, significant and changing government regulation, and the timing and receipt of any regulatory approvals.

Significant accounting policies

The Company’s significant accounting policies are described herein and in Note 3, “Summary of significant accounting policies,” in the Annual Report. There have been no material changes to the significant accounting policies during the nine months ended September 30, 2022.

Recently issued accounting pronouncement

In February 2016, the FASB issued ASU No. 2016-02, Leases (“ASU 2016-02”), as amended, which requires a lessee to recognize assets and liabilities on the balance sheet for operating leases and changes many key definitions, including the definition of a lease. The new standard includes a short-term lease exception for leases with a term of 12 months or less, as part of which a lessee can make an accounting policy election not to recognize lease assets and lease liabilities. Lessees will continue to differentiate between finance leases (previously referred to as capital leases) and operating leases using classification criteria that are substantially similar to the previous guidance. The new standard became effective for the Company for annual reporting periods beginning after December 15, 2021, and interim periods within

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fiscal years beginning after December 15, 2022, and early adoption is permitted. The Company does not anticipate the adoption of these amendments will have a material impact on the financial statements.

Prior Period Reclassifications

Certain amounts in prior periods may have been reclassified to conform with current period presentation. Interest expense is now presented separately in the condensed statements of operations, and previously was a component of other (income) expense, net. These reclassifications did not affect net loss in any period presented.

3. Supplemental financial information

Cash, cash equivalents and restricted cash

Cash and cash equivalents consist of cash and, if applicable, highly liquid investments with an original maturity of three months or less when purchased. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the condensed statements of cash flows (in thousands).


	As of		As of
	September 30,		December 31,
	2022		2021
Cash and cash equivalents	$	66,584	$	106,124
Short-term restricted cash		179		197
Total cash, cash equivalents, and restricted cash shown in the statements of cash flows	$	66,763	$	106,321

Prepaid expenses and other current assets

Prepaid expenses and other current assets consist of the following (in thousands):


	As of		As of
	September 30,		December 31,
	2022		2021
Prepaid clinical	$	3,041	$	4,693
Prepaid insurance		1,529		1,122
Prepaid manufacturing costs		2,261		2,241
Other prepaid expenses and current assets		356		366
Total prepaid expenses and other current assets	$	7,187	$	8,422

Accrued expenses and other current liabilities

Accrued expenses and other current liabilities consist of the following (in thousands):


	As of		As of
	September 30,		December 31,
	2022		2021
Employee-related expenses	$	867	$	2,567
Development costs and sponsored research		455		1,347
Clinical trials		131		810
Other		767		340
Total accrued expenses and other current liabilities	$	2,220	$	5,064

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4. Research collaboration agreement with Allergan

On July 24, 2015, the Company entered into a Research Collaboration Agreement (“RCA”) with Naurex Inc., a subsidiary of Allergan plc (“Allergan”), which became a wholly owned subsidiary of AbbVie Inc. in May 2020. The RCA was focused on the research and discovery of small molecules that modulate NMDArs. Under the terms of the agreement, the RCA terminated upon the earlier of (i) 180 days after a predetermined anniversary of the effective date of the RCA and (ii) the date on which Allergan exercised the last of three options to acquire molecules from a pool of eligible compounds, in both cases (clauses (i) and (ii)) subject to potential extension if and as required for the Company to transfer to Allergan information and technology related to compounds that were licensed by Allergan. The jointly funded research activities and option exercise period under the RCA, including the associated payments by Allergan to the Company, came to their contractual conclusions in accordance with the agreement in August 2020 and February 2021, respectively. Under the terms of the agreement, Allergan was to pay the Company $1.0 million for each option exercised by Allergan. On February 23, 2021, Allergan exercised its option to acquire exclusive rights to develop and commercialize AGN-281705 within a predefined set of indications. For the nine months ended September 30, 2021, the Company recognized the $1.0 million non-refundable milestone payment within collaboration revenue in the statements of operations as there were no remaining performance obligations associated with the optioned compound.

5. Fair value measurements

ASC 820, Fair Value Measurement (“ASC 820”), establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). ASC 820 identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a three-tier fair value hierarchy that distinguishes between the following:

●

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;

●

Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and

●

Level 3 inputs are unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The carrying values reported in the Company’s balance sheets for cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and accrued expenses are reasonable estimates of their fair values due to the short-term nature of these items.

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Assets and liabilities measured at fair value on a recurring basis as of September 30, 2022, are as follows (in thousands):


	September 30,
	2022		Level 1		Level 2		Level 3
Assets
Money market funds, included in cash and cash equivalents	$	65,991	$	65,991	$	—	$	—
Money market funds, included in restricted cash		179		179		—		—
Total Assets	$	66,170	$	66,170	$	—	$	—
Liabilities
Derivative liability, included in other long-term liabilities	$	10	$	—	$	—	$	10
Total Liabilities	$	10	$	—	$	—	$	10

Assets measured at fair value on a recurring basis as of December 31, 2021, are as follows (in thousands):


	December 31,
	2021		Level 1		Level 2		Level 3
Assets
Money market funds, included in cash and cash equivalents	$	103,859	$	103,859	$	—	$	—
Money market funds, included in restricted cash		197		197		—		—
Total Assets	$	104,056	$	104,056	$	—	$	—
Liabilities
Derivative liability, included in other long-term liabilities	$	331	$	—	$	—	$	331
Total Liabilities	$	331	$	—	$	—	$	331

6. Property and equipment, net

Property and equipment are as follows (in thousands):


	As of		As of
	September 30,		December 31,
	2022		2021
Office equipment and furniture		152		152
Laboratory equipment		401		401
Leasehold improvements		979		979
Less accumulated depreciation		(1,496)		(1,347)
Property and equipment, net	$	36	$	185

Depreciation expense was less than $0.1 million and $0.1 million for each of the three months ended September 30, 2022 and 2021, respectively, and $0.1 million and $0.5 million for the nine months ended September 30, 2022 and 2021, respectively. The Company disposed of certain laboratory equipment during the nine months ended September 30, 2021, that were fully depreciated at the time of disposal.

7. Debt

On September 15, 2021, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with K2 HealthVentures LLC (the “Lender”). The Lender has agreed to make available to the Company term loans in an aggregate principal amount of up to $50.0 million under the Loan Agreement. The Company plans to use the proceeds of the term loans to support clinical development as well as for working capital and general corporate purposes. The Loan Agreement provides a term loan commitment of $50.0 million in four potential tranches: (i) a $15.0 million term loan facility funded on September 15, 2021 (the “First Tranche Term Loan”); (ii) a $10.0 million term loan facility (the “Second Tranche Term Loan”) funded on March 14, 2022; (iii) a $10.0 million term loan facility (the “Third Tranche Term Loan”) available at the Company’s option between July 1, 2022, and December 1, 2022, subject to the draw of the Second Tranche Term Loan and positive Phase 2 clinical data from NYX-2925 or NYX-458 and progression of another

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clinical asset; and (iv) a $15.0 million term loan facility (the “Fourth Tranche Term Loan”) available through July 1, 2023, at the Company’s option but subject to review of financial and clinical plans and Lender’s Investment Committee approval. All four of these term loans have a maturity date of September 1, 2025.

Borrowings under all four term loan facilities bear interest at a floating per annum rate equal to the greater of (i) 7.95% and (ii) the Prime Rate plus 4.70%. The Company is permitted to make interest-only payments on the First Tranche Term Loan for the first 24 months following the funding date. The interest-only period can be extended by an additional 12 months, subject to the funding of the Second Tranche Term Loan and the funding of the Third Tranche Term Loan. The term of the combined facility will be 48 months, with repayment in monthly installments commencing at the end of the resulting interest-only period as outlined above through the end of the 48-month term.

The Company is obligated to pay a final fee equal to 6.45% of the aggregate amount of the term loans funded (“Exit Fee”), to occur upon the earliest of (i) the maturity date, (ii) the acceleration of the term loans, and (iii) the prepayment of the term loans. The Company has the option to prepay all, but not less than all, of the outstanding principal balance of the term loans under the Loan Agreement. If the Company prepays all of the term loans prior to the maturity date, it will pay the Lender a prepayment penalty fee based on a percentage of the outstanding principal balance, equal to 3% if the payment occurs on or before 24 months after the initial funding date, 2% if the prepayment occurs more than 24 months after, but on or before 36 months after the initial funding date, or 1% if the prepayment occurs more than 36 months after the initial funding date. The Company also is obligated to pay the Lender an origination fee of 0.8% of all term loans funded at the time of funding.

The Lender may, at its option, elect to convert any portion of no more than $4 million of the then outstanding term loan amount and all accrued and unpaid interest thereon into shares of the Company’s common stock at a conversion price of the lesser of $4.25 per share and the price per share of the common stock in the Company’s next equity offering in which the Company receives at least $20.0 million of gross proceeds. The Company determined that the embedded conversion option is not required to be separated from the term loan. The embedded conversion option meets the derivative accounting scope exception since the embedded conversion option is indexed to the Company’s own common stock and qualifies for classification within stockholders’ equity.

The Company’s obligations under the Loan Agreement are secured by a first priority security interest in substantially all of its assets. The Loan Agreement contains customary representations and warranties, and also includes customary events of default, including payment default, breach of covenants, change of control, and material adverse effects. The Loan Agreement restricts certain activities, such as disposing of the Company’s business or certain assets, incurring additional debt or liens or making payments on other debt, making certain investments and declaring dividends, acquiring or merging with another entity, engaging in transactions with affiliates or encumbering intellectual property, among others. There are no financial covenants associated with the Loan Agreement. The Company was in compliance with all non-financial covenants under the Loan Agreement as of September 30, 2022.

Upon the occurrence of an event of default, a default interest rate of an additional 5% per annum may be applied to the outstanding loan balances, and the Lender may declare all outstanding obligations immediately due and payable and exercise all of its rights and remedies as set forth in the Loan Agreement and under applicable law.

The Company recorded interest expense related to the Loan Agreement of $0.9 million for the three months ended September 30, 2022, and $2.1 million for the nine months ended September 30, 2022.

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Future principal debt payments of the term loans funded as of September 30, 2022, are as follows (in thousands):



2023	$	2,828
2024		12,112
2025		10,060
Total principal payments		25,000
Exit Fee		1,613
Total principal payments and Exit Fee		26,613
Less: Unamortized debt discount related to warrants		(378)
Less: Unamortized debt discount related to Exit Fee		(1,201)
Less: Unamortized debt issuance costs		(325)
Term loan, non-current	$	24,709

8. Stock incentive plans

On June 5, 2018, the Company’s stockholders approved the 2018 Stock Option and Incentive Plan (the “2018 Plan”), which became effective on June 20, 2018.

Stock-based compensation expense

Non-cash stock-based compensation expense recognized in the accompanying condensed statements of operations relating to stock options, restricted stock awards, and restricted stock units for the three and nine months ended September 30, 2022 and 2021, was as follows (in thousands):


	Three months ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Research and development	$	277	$	634	$	1,096	$	2,047
General and administrative		1,719		1,628		5,531		5,348
Total stock‑based compensation expense	$	1,996	$	2,262	$	6,627	$	7,395

Stock options

The table below summarizes activity related to stock options (in thousands, except per share amounts):


				Weighted‑
		Weighted‑		average
		average		remaining	Aggregate
		exercise		contractual	intrinsic
Options	Shares	price		term	value
Outstanding, December 31, 2021	10,713	$	5.36	8.07	$	718
Granted	2,307		2.96
Exercised	—		—
Forfeited and canceled	(1,099)		3.94
Outstanding, September 30, 2022	11,921	$	5.03	7.52	$	—
Vested and expected to vest at September 30, 2022	11,921	$	5.03	7.52	$	—
Exercisable at September 30, 2022	6,541	$	6.61	6.45	$	—

During the nine months ended September 30, 2022 and 2021, the Company granted 2.3 million and 3.2 million stock options, respectively, and these options had a weighted-average grant-date fair value of $2.26 and $2.71 per share, respectively. The weighted-average grant-date fair value of options was determined using the Black-Scholes option-pricing model. The assumptions used in the Black-Scholes option-pricing model for options granted during the nine months ended September 30, 2022, were similar to those as described in the Annual Report, except for the manner in

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which the expected volatility was determined. The expected volatility for the Company’s options granted during the nine months ended September 30, 2022, is based on a weighted-average of the historical volatility of share values of publicly traded companies within the biotechnology industry, which includes the historical volatility of the Company’s stock since the Company’s initial public offering. As of September 30, 2022, there was $11.3 million of total unrecognized stock-based compensation expense related to non-vested stock options, which is expected to be recognized over a weighted-average period of 2.6 years. The options have a ten-year life and generally vest over a period of four years, subject to continuous employment.

Restricted stock units

In June 2020, the Company issued an aggregate of 205,200 restricted stock units to employees. The restricted stock units issued in 2020 vested ten months from the date of grant. Such shares were not accounted for as outstanding until they vested. Non-cash restricted stock unit award expense recognized in the accompanying condensed statements of operations was $0.0 million and $0.0 million for the three months ended September 30, 2022 and 2021, respectively, and $0.0 million and $0.8 million for the nine months ended September 30, 2022 and 2021, respectively. There were no unvested restricted stock units as of September 30, 2022.

9. Warrants and derivative liability

Warrants

On September 15, 2021, the Company entered into the Loan Agreement with the Lender pursuant to which the Lender may provide the Company with term loans in an aggregate principal amount of up to $50.0 million.

On September 15, 2021, in connection with the funding of the First Tranche Term Loan, the Company issued a warrant exercisable for 147,600 shares of the Company’s common stock at an exercise price of $2.29 per share. The warrant is immediately exercisable for 147,600 shares and expires on September 15, 2031.

On March 14, 2022, in connection with the funding of the Second Tranche Term Loan, the Company issued a warrant exercisable for 98,399 shares of the Company’s common stock at an exercise price of $2.29 per share. The warrant is immediately exercisable for 98,399 shares and expires on September 15, 2031.

No warrants had been exercised as of September 30, 2022. Any shares of the Company’s common stock issued upon exercise of the warrants are permitted to be settled in unregistered shares. The warrants are classified as equity as they meet all of the conditions under GAAP for equity classification. The Company has calculated the fair value of the warrants for initial measurement and date of funding of the Second Tranche Term Loan, and reassesses whether equity classification for the warrants is appropriate upon any changes to the warrants or capital structure, at each balance sheet date.

The Company determined that the fair value of the warrants issued in connection with the First Tranche Term Loan and Second Tranche Term Loan was $0.3 million and $0.2 million, respectively. The specific assumptions used to determine the initial measurement of fair value of the warrants were as follows:


	First Tranche		Second Tranche
	Term Loan		Term Loan

Expected volatility	95	%	93	%
Expected dividends	None		None
Expected term	5.00 Years		5.00 Years
Risk-free rate	0.81	%	2.10	%

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Derivative Liability

The Additional Warrants’ (as defined below) derivative liability will be remeasured each reporting period until settled or extinguished with subsequent changes in fair value recorded through other income (expense), net in the condensed statements of operations. The fair value of the Additional Warrants derivative liability was determined using a Black-Scholes option pricing model based on the same input assumptions above, with an additional assessment required for the probability that the Additional Tranche Term Loans will be funded which would trigger the issuance of the Additional Warrants.

The Company is conditionally obligated to issue a fixed number of additional warrants (“Additional Warrants”) in the amount of 344,398 shares of the Company’s common stock upon the funding of the Second, Third and Fourth Tranche Term Loans with the same exercise price and contractual term. The contingent obligation to issue the Additional Warrants did not meet the derivative scope exception or equity classification criteria and were accounted for as a derivative liability. The contingently issuable Additional Warrants derivative liability had an initial fair value of $0.3 million and was recorded as additional debt discount and as a separate derivative liability within other long-term liabilities in the condensed balance sheet.

As a result of the funding of the Second Tranche Term Loan, the Company issued a warrant exercisable for 98,399 shares of the Company’s common stock at $2.29 per share. Upon issuing the warrants, the Company reclassified the related portion of its Additional Warrants derivative liability into equity. The remaining Additional Warrant Liability that remains outstanding was remeasured as of period end. The Company recorded a $0.1 million loss on change in fair value through other (income) expense, net in the condensed statement of operations.

The following table provides a reconciliation of the beginning and ending balances for the Company’s Additional Warrants derivative liability recognized in connection with the term loan measured at fair value using significant unobservable inputs (Level 3):


	Additional
	Warrants
Balance at December 31, 2021	$	331
Fair value of Additional Warrant Derivative Liability issued during the period		—
Change in fair value		(115)
Derecognition		(206)
Balance at September 30, 2022	$	10

The specific assumptions used to determine the fair value of the warrants as of September 30, 2022, and December 31, 2021 were as follows:


	September 30,		December 31,
	2022		2021

Expected volatility	98	%	95	%
Expected dividends	None		None
Expected term	5.00 Years		5.00 Years
Risk-free rate	4.06	%	1.26	%

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10. Net loss per share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows for the three and nine months ended September 30, 2022 and 2021 (in thousands, except per share data):


	Three months ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Numerator:
Net loss attributable to common stockholders	$	(15,303)	$	(21,231)	$	(52,797)	$	(55,276)
Denominator:
Weighted-average common shares outstanding—basic and diluted		67,716		67,716		67,716		67,053
Net loss per share attributable to common stockholders—basic and diluted	$	(0.23)	$	(0.31)	$	(0.78)	$	(0.82)

The following common stock equivalents outstanding as of September 30, 2022 and 2021, were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because including them would have been anti-dilutive (in thousands):


	As of
	September 30,
	2022	2021
Stock options issued and outstanding	11,921	9,392
Warrants	246	148
Total	12,167	9,540

11. Income taxes

Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets, including its net operating losses. Based on its history of operating losses, the Company believes that it is more likely than not that the benefit of its deferred tax assets will not be realized. Accordingly, the Company has provided a full valuation allowance for deferred tax assets as of September 30, 2022, and December 31, 2021.

12. Commitments and contingencies

Contingencies

From time to time, the Company may be subject to occasional lawsuits, investigations, and claims arising out of the normal conduct of business. The Company has no significant pending or threatened litigation as of September 30, 2022.

Indemnifications

In the normal course of business, the Company enters into contracts that contain a variety of indemnifications with its employees, licensors, suppliers and service providers. Further, the Company indemnifies its directors and officers who are, or were, serving at the Company’s request in such capacities. The Company’s maximum exposure under these arrangements is unknown as of September 30, 2022. The Company does not anticipate recognizing any significant losses relating to these arrangements.

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Leases

The Company enters into various non-cancelable, operating lease agreements for its facilities and equipment in order to conduct its operations. The Company expenses rent on a straight-line basis over the life of the lease and has recorded deferred rent on the Company’s balance sheets within both accrued expenses and other current liabilities and other long-term liabilities.

Total rent expense, inclusive of lease incentives, under all the operating lease agreements amounted to $0.2 million for each of the three months ended September 30, 2022 and 2021, and $0.7 million and $0.6 million for the nine months ended September 30, 2022 and 2021.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion should be read in conjunction with our condensed financial statements and accompanying footnotes appearing elsewhere in this Quarterly Report on Form 10-Q and our audited financial statements and related footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2021, or Annual Report, filed with the Securities and Exchange Commission, or the SEC, on March 23, 2022.

Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. See “Special Note Regarding Forward-Looking Statements.” Because of many factors, including those factors set forth in the “Risk Factors” section of our Annual Report, and Form 10-Q for the quarter ended June 30, 2022 and in section Part II, Item 1A of this Quarterly Report on Form 10-Q, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. We do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

Overview

We are a clinical-stage biopharmaceutical company focused on the discovery, development, and commercialization of novel, proprietary, synthetic small molecules for the treatment of nervous system disorders. We focus our efforts on targeting and modulating N-methyl-D-aspartate receptors, or NMDArs, which are vital to normal and effective function of the brain and nervous system. We believe leveraging the therapeutic advantages of the differentiated modulatory mechanism of our compounds will drive a paradigm shift in the treatment of disorders of the brain and nervous system. We are advancing a pipeline of distinct product candidates derived from our NMDAr modulator discovery platform, or the discovery platform. The following table summarizes the current status of our development programs as of the date of this quarterly report.

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NYX-783 is in Phase 2b clinical development for the treatment of post-traumatic stress disorder, or PTSD. We are currently enrolling a Phase 2b study evaluating the efficacy and safety of a 50 mg dose of NYX-783 in approximately 300 patients with PTSD. In June 2022, the U.S. Food and Drug Administration indicated our Investigational New Drug application to evaluate NYX-783 in opioid use disorder, or OUD, was cleared to proceed. Preclinical research and expected clinical development of NYX-783 in OUD is funded by a $5.6 million grant under the National Institutes of Health Helping to End Addiction Long-term, or HEAL, Initiative, administered by the National Institute on Drug Abuse (NIDA) and awarded to researchers at Yale University School of Medicine, who are conducting the studies.

NYX-458 is in clinical development for the treatment of cognitive impairment associated with neurodegenerative conditions. On August 25, 2022, we announced the completion of enrollment of 99 patients in our ongoing Phase 2 study of NYX-458 in cognitive impairment associated with Parkinson’s disease and dementia with Lewy bodies.

NYX-2925 is our product candidate previously in clinical development for the treatment of fibromyalgia. On August 12, 2022, we announced that statistically significant separation from placebo was not observed on the primary endpoint of a Phase 2b study of NYX-2925 in fibromyalgia patients. Patients receiving NYX-2925 showed a trend toward clinically meaningful improvement in pain, as well as in some secondary endpoints, versus placebo by week 4. However, by week 12, the placebo group had improved such that, although NYX-2925 remained numerically better, the separation was not clinically meaningful. Going forward, we will focus our existing resources on our other ongoing clinical development programs and will not be allocating additional resources to the development of NYX-2925.

The COVID-19 pandemic has and could further adversely impact our clinical and/or preclinical studies, as well as our business operations. We continue to evaluate the impact of the COVID-19 pandemic on patients and our employees, as well as our operations and the operations of our business partners and healthcare communities. In response to the COVID-19 pandemic, we have implemented policies to mitigate the risk of exposure to COVID-19 by our personnel, including a work-from-home policy applicable to the majority of our personnel and a phased approach to bringing personnel back to our locations over time. However, the ultimate impact of the COVID-19 pandemic on our business operations is highly uncertain and subject to change and will depend on future developments which are difficult to predict.

Since our inception in June 2015, we have never generated revenue from the sale of our products and have incurred significant net losses. Our nominal revenues have been primarily derived from a research collaboration agreement with Allergan plc, or Allergan, a development services agreement with Allergan, and research and development grants from the U.S. government. While these revenues offset a small portion of the costs associated with our early-stage research and discovery efforts, we do not rely on these revenues to fund our operations. In connection with the contractual

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conclusion of our research collaboration with Allergan in February 2021, we do not expect to receive further revenues from this collaboration.

From our inception through September 30, 2022, we have raised an aggregate of $135.0 million of gross proceeds from sales of our convertible preferred stock, $117.8 million of gross proceeds from our initial public offering, or IPO, $104.4 million of gross proceeds from our follow-on public offerings and our “at the market” offering program, or the ATM Offering, and $25.0 million of gross proceeds from our Loan Agreement. See “Liquidity and capital resources.” Our net losses were $74.9 million and $50.1 million for the years ended December 31, 2021 and 2020, respectively, and $52.8 million and $55.3 million for the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022, we had an accumulated deficit of $340.7 million. Our net losses may fluctuate significantly from quarter to quarter and year to year. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate that our expenses will continue to increase in connection with our ongoing activities.

We believe that our available funds will be sufficient to fund our operations for at least the next twelve months. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect. We do not expect to generate revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for a product candidate, which we expect will take a number of years and the outcome of which is uncertain, or enter into collaborative agreements with third parties, the timing of which is largely beyond our control and may never occur. To fund our current and future operating plans, we will need additional capital, which we may obtain through one or more equity offerings, debt financings, or other third-party funding, including potential strategic alliances and licensing or collaboration arrangements. We may, however, be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all, including as a result of COVID-19. Our failure to raise capital or enter into such other arrangements as and when needed would have a negative impact on our financial condition and our ability to develop our current product candidates, or any additional product candidates, if developed. The amount and timing of our future funding requirements will depend on many factors, including the impacts of COVID-19, our ability to timely and successfully enroll subjects in our clinical studies, and the pace and results of our preclinical and clinical development efforts. We cannot assure you that we will ever be profitable or generate positive cash flow from operating activities.

Financial operations overview

Revenues

We have not generated any revenue from product sales. We are unable to predict when, if ever, material net cash inflows will commence from sales of our products, if approved. Our revenue to date has been primarily derived from a research collaboration agreement with Allergan (now a subsidiary of AbbVie), under which the jointly funded research activities and option exercise period, including the associated payments by Allergan, came to their contractual conclusion in August 2020 and February 2021, respectively; a development services agreement with Allergan, which was put in place to continue certain development activities for a pre-determined period of time following Allergan's acquisition of Naurex Inc.; and research and development grants from the U.S. government that have no repayment or royalty obligations and none of which are currently outstanding.

Operating expenses

Research and development expenses

Research and development activities account for a significant portion of our operating expenses. We expense research and development costs as incurred. Research and development expenses consist of costs incurred in connection with the development of our product candidates, including:

●

fees paid to consultants, sponsored researchers, contract manufacturing organizations, or CMOs, and contract research organizations, or CROs, including in connection with our preclinical and clinical studies, and other related clinical study fees, such as for investigator grants, patient screening, laboratory work, clinical study database management, and statistical compilation and analysis;

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●

costs related to acquiring and maintaining preclinical and clinical study materials and facilities;

●

costs related to compliance with regulatory requirements; and

●

costs related to salaries, bonuses, and other compensation, including stock-based compensation, for employees in research and development functions.

At this time, we cannot reasonably estimate or know the nature, timing, and costs of the efforts that will be necessary to complete the development of our product candidates. This is due to the numerous risks and uncertainties associated with developing such product candidates, including the uncertainty related to:

●

the impacts of COVID-19 and future health epidemics;

●

future clinical study results;

●

the scope, rate of progress, and expense of our ongoing as well as any additional preclinical studies, clinical studies and other research and development activities;

●

clinical study enrollment rate or design;

●

the manufacturing of our product candidates;

●

our ability to obtain and maintain intellectual property protection for our product candidates;

●

our ability to obtain funding for our operations, including funding necessary to complete further development and commercialization of our product candidates;

●

significant and changing government regulation;

●

establishing commercial manufacturing capabilities or making arrangements with third-party manufacturers, developing and timely delivery of commercial-grade drug formulations that can be used in our clinical trials and for commercial launch;

●

the timing and receipt of regulatory approvals, if any; and

●

the risks disclosed in the section entitled “Risk Factors” of our Annual Report, and Form 10-Q for the quarter ended June 30, 2022.

A change in the outcome of any of these variables with respect to the development of any of our product candidates could significantly change the costs, timing, and viability associated with the development of that product candidate.

We expect our research and development expenses to increase over the next several years as we continue to implement our business strategy, which includes advancing our product candidates into and through clinical development, expanding our research and development efforts, seeking regulatory approvals for any product candidates for which we successfully complete clinical studies, accessing and developing additional product candidates, and hiring additional personnel to support our research and development efforts. In addition, product candidates in later stages of clinical development generally incur higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical studies. As such, we expect our research and development expenses to increase as our product candidates advance into later stages of clinical development.

General and administrative expenses

General and administrative expenses consist primarily of salaries and related costs, including stock-based compensation. General and administrative expenses also include rent as well as professional fees for legal, consulting, accounting, and audit services.

In the future, we expect that our general and administrative expenses will increase as we continue to support our research and development and the potential commercialization of our product candidates, if approved.

Other (income) expense, net, and interest expense

Other (income) expense, net and interest expense consists primarily of the interest income earned on our cash and cash equivalents and interest expense on our Loan Agreement, and includes changes in fair value of the derivative liability associated with our obligation to issue additional warrants in connection with subsequent draws under our Loan Agreement.

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Results of operations

Comparison of the three months ended September 30, 2022 and 2021

The following table summarizes our results of operations for the three months ended September 30, 2022 and 2021 (in thousands):


	Three months
	ended September 30,				Increase
	2022		2021		(Decrease)
Operating expenses:
Research and development	$	10,008	$	16,278	$	(6,270)
General and administrative		4,649		4,928		(279)
Total operating expenses		14,657		21,206		(6,549)
Loss from operations		(14,657)		(21,206)		(6,549)
Other (income) expense, net		(208)		(47)		(161)
Interest expense		854		72		782
Net loss and comprehensive loss	$	(15,303)	$	(21,231)	$	(5,928)

Research and development expenses

The following table summarizes our research and development expenses incurred during the three months ended September 30, 2022 and 2021 (in thousands):


	Three months
	ended September 30,				Increase
	2022		2021		(Decrease)
NYX-2925	$	2,674	$	8,946	$	(6,272)
NYX-783		2,815		1,524		1,291
NYX-458

Aptinyx Inc. [APTX] Filings
10-Q	[2022-11-08]
10-Q	[2022-08-04]
10-Q	[2022-05-12]
10-K	[2022-03-23]
10-Q	[2021-11-09]
10-Q	[2021-08-10]
10-Q	[2021-05-13]
10-K	[2021-03-24]
10-Q	[2020-11-12]
10-Q	[2020-08-13]
10-Q	[2020-05-14]
10-K	[2020-03-30]
10-Q	[2019-11-12]
10-Q	[2019-08-12]
10-Q	[2019-05-14]
10-K	[2019-03-21]
10-Q	[2018-11-13]
10-Q	[2018-08-14]
S-1	[2018-05-23]