10-Q 1 drrx-20240331.htm 10-Q 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

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

For the quarterly period ended March 31, 2024

OR

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

For the transition period from to

Commission file number 000-31615

 

DURECT CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Delaware

94-3297098

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

10240 Bubb Road

Cupertino, California 95014

(Address of principal executive offices, including zip code)

(408) 777-1417

(Registrant’s telephone number, including area code)

 

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

Title of Each Class

 

Trading Symbol

 

Name of Each Exchange on Which Registered

Common Stock $0.0001 par value per share

 

 

DRRX

 

The NASDAQ Stock Market LLC

(The Nasdaq Capital 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, a 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 May 9, 2024, there were 31,039,381 shares of the registrant’s common stock outstanding.

 

 


 

INDEX

 

 

 

Page

 

 

 

 

PART I. FINANCIAL INFORMATION

 

 

 

 

Item 1.

Financial Statements

5

 

 

 

Condensed Balance Sheets as of March 31, 2024 and December 31, 2023

5

 

 

 

Condensed Statements of Operations and Comprehensive Loss for the three months ended March 31, 2024 and 2023

6

 

 

 

 

Condensed Statements of Stockholders’ Equity for the three months ended March 31, 2024 and 2023

7

 

 

 

Condensed Statements of Cash Flows for the three months ended March 31, 2024 and 2023

8

 

 

 

Notes to Condensed Financial Statements

9

 

 

 

Item 2.

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

23

 

 

 

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

29

 

 

 

Item 4.

Controls and Procedures

29

 

 

 

 

PART II. OTHER INFORMATION

 

 

 

 

Item 1.

Legal Proceedings

30

 

 

 

Item 1A.

Risk Factors

30

 

 

 

Item 5.

Other Information

31

 

 

 

Item 6.

Exhibits

32

 

 

 

Signatures

33

 

2


 

Special Note Regarding Forward-Looking Statements

This Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. When used in this Quarterly Report on Form 10-Q or elsewhere by management from time to time, the words “believe,” “anticipate,” “intend,” “plan,” “estimate,” “expect,” “may,” “will,” “could,” “potentially,” “possibility,” and similar expressions are forward-looking statements. Such forward-looking statements contained herein are based on current expectations and beliefs. Any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual events or results may differ materially from those discussed in the forward-looking statements as a result of various factors. Forward-looking statements made in this report include, but are not limited to, statements about:

potential uses and benefits of larsucosterol to treat alcohol-associated hepatitis (“AH”), non-alcoholic steatohepatitis, or other conditions;
the results and timing of clinical trials, including clinical trial plans and timelines for larsucosterol;
the likelihood of future clinical trial results of larsucosterol being positive with statistical significance and/or similar to results from previous trials, the possible commencement of future clinical trials;
our communication with the U.S. Food and Drug Administration (“FDA”) regarding the trial design for a Phase 3 clinical trial for larsucosterol in AH and the potential for a New Drug Application filing;
our intention to seek, and ability to enter into and maintain strategic alliances and collaborations;
the potential benefits and uses of our products and product candidates, including larsucosterol and POSIMIR;
the potential milestone and royalty payments we may receive from Innocoll Pharmaceuticals Limited related to POSIMIR, earn-out payments we may receive from Indivior UK Limited related to the commercialization of PERSERIS, and milestone, sub-license fees and royalty payments we may receive from Orient Pharma Co., Ltd.;
market opportunities for product candidates in our product development pipeline;
potential regulatory filings for or approval of larsucosterol;
the progress and results of our research and development programs and our evaluation of additional development programs;
requirements for us to purchase pre-clinical, clinical trial and commercial supplies of product candidates and/or products, as well as raw materials or active pharmaceutical ingredients from third parties, and the ability of third parties to provide us with our requirements for such supplies and raw materials;
conditions for obtaining regulatory approval of our product candidates;
submission and timing of applications for regulatory approval and timing of responses to our regulatory submissions;
the impact of FDA, European Medicines Agency and other government regulation on our business;
our ability to obtain, assert and protect patents and other intellectual property rights, including intellectual property licensed to our collaborators, as well as avoiding the intellectual property rights of others;
products and companies that will compete with our products and the product candidates we develop and/or license to third-party collaborators;
our employees, including the number of employees and the continued services of key management, technical and scientific personnel;

3


 

our future performance, including our anticipation that we will not derive meaningful revenues from our products and product candidates in development for at least the next twelve months, potential for future inventory write-offs and our expectations regarding our ability to achieve profitability;
sufficiency of our cash resources, anticipated capital requirements and capital expenditures, our ability to comply with covenants of our term loan, our need or desire for additional financing, including potential sales under our shelf registration statement and our ability to continue to operate as a going concern;
our expectations regarding research and development expenses, and selling, general and administrative expenses;
the composition of future revenues; and
accounting policies and estimates.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual events or results may differ materially from those discussed in the forward-looking statements as a result of various factors. For a more detailed discussion of such forward looking statements and the potential risks and uncertainties that may impact upon their accuracy, see the “Overview” section of the Management’s Discussion and Analysis of Financial Condition and Results of Operations herein and Part I, Item 1A., “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 28, 2024 and any additional risk factors that may be described herein or in our subsequent reports filed with the SEC “Risk Factors” section. These forward-looking statements reflect our view only as of the date of this report. We undertake no obligations to update any forward-looking statements. You should also carefully consider the factors set forth in other reports or documents that we file from time to time with the Securities and Exchange Commission.

4


 

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

DURECT CORPORATION

CONDENSED BALANCE SHEETS

(in thousands)

(unaudited)

 

 

March 31,
2024

 

 

December 31,
2023

 

A S S E T S

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

19,252

 

 

$

28,400

 

Short-term investments

 

 

2,187

 

 

 

1,280

 

Accounts receivable, net

 

 

1,020

 

 

 

1,261

 

Inventories, net

 

 

2,398

 

 

 

2,219

 

Prepaid expenses and other current assets

 

 

1,228

 

 

 

1,511

 

Total current assets

 

 

26,085

 

 

 

34,671

 

Property and equipment, net

 

 

58

 

 

 

91

 

Operating lease right-of-use assets

 

 

3,631

 

 

 

3,980

 

Goodwill

 

 

6,169

 

 

 

6,169

 

Long-term restricted investments

 

 

150

 

 

 

150

 

Other long-term assets

 

 

128

 

 

 

128

 

Total assets

 

$

36,221

 

 

$

45,189

 

L I A B I L I T I E S A N D S T O C K H O L D E R S’ E Q U I T Y

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

782

 

 

$

1,777

 

Accrued liabilities

 

 

5,105

 

 

 

5,966

 

Term loan, current portion, net

 

 

14,612

 

 

 

16,663

 

Operating lease liabilities, current portion

 

 

1,298

 

 

 

1,381

 

Warrant liabilities

 

 

2,942

 

 

 

1,224

 

Total current liabilities

 

 

24,739

 

 

 

27,011

 

Operating lease liabilities, non-current portion

 

 

2,466

 

 

 

2,702

 

Other long-term liabilities

 

 

716

 

 

 

693

 

Commitments and contingencies

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Common stock

 

 

23

 

 

 

23

 

Additional paid-in capital

 

 

604,936

 

 

 

603,780

 

Accumulated other comprehensive loss

 

 

(10

)

 

 

(14

)

Accumulated deficit

 

 

(596,649

)

 

 

(589,006

)

Stockholders’ equity

 

 

8,300

 

 

 

14,783

 

Total liabilities and stockholders’ equity

 

$

36,221

 

 

$

45,189

 

 

The accompanying notes are an integral part of these condensed financial statements.

5


 

DURECT CORPORATION

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands, except per share amounts)

(unaudited)

 

 

 

Three months ended
March 31,

 

 

 

2024

 

 

2023

 

Collaborative research and development and other revenue

 

$

496

 

 

$

643

 

Product revenue, net

 

 

1,331

 

 

 

1,411

 

Total revenues

 

 

1,827

 

 

 

2,054

 

Operating expenses:

 

 

 

 

 

 

Cost of product revenues

 

 

289

 

 

 

388

 

Research and development

 

 

4,119

 

 

 

8,593

 

Selling, general and administrative

 

 

3,136

 

 

 

4,095

 

Total operating expenses

 

 

7,544

 

 

 

13,076

 

Loss from operations

 

 

(5,717

)

 

 

(11,022

)

Other income (expense):

 

 

 

 

 

 

Interest and other income

 

 

321

 

 

 

517

 

Interest and other expenses

 

 

(529

)

 

 

(726

)

Change in fair value of warrant liabilities

 

 

(1,718

)

 

 

2,477

 

Issuance cost for warrants

 

 

 

 

 

(1,200

)

Loss on issuance of warrants

 

 

 

 

 

(2,033

)

Other income (expense), net

 

 

(1,926

)

 

 

(965

)

Net loss

 

 

(7,643

)

 

 

(11,987

)

Net change in unrealized gain on available-for-sale securities, net of reclassification adjustments and taxes

 

 

4

 

 

 

6

 

Total comprehensive loss

 

$

(7,639

)

 

$

(11,981

)

 

 

 

 

 

 

 

Net loss per share

 

 

 

 

 

 

Basic

 

$

(0.25

)

 

$

(0.50

)

Diluted

 

$

(0.25

)

 

$

(0.52

)

 

 

 

 

 

 

 

Weighted-average shares used in computing net loss per share

 

 

 

 

 

 

Basic

 

 

30,637

 

 

 

23,767

 

Diluted

 

 

30,637

 

 

 

23,940

 

 

The accompanying notes are an integral part of these condensed financial statements.

6


 

DURECT CORPORATION

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands, except per share amounts)

(unaudited)

 

 

 

Common Stock

 

 

Additional
Paid-In

 

 

Accumulated
Other
Comprehensive

 

 

Accumulated

 

 

Total
Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Loss

 

 

Deficit

 

 

Equity

 

Balance at December 31, 2023

 

 

30,334

 

 

$

23

 

 

$

603,780

 

 

$

(14

)

 

$

(589,006

)

 

$

14,783

 

Issuance of common stock pursuant to the 2021 Sales Agreement, net of issuance costs of $13

 

 

702

 

 

 

 

 

 

647

 

 

 

 

 

 

 

 

 

647

 

Stock-based compensation expense from stock options and ESPP shares

 

 

 

 

 

 

 

 

509

 

 

 

 

 

 

 

 

 

509

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,643

)

 

 

(7,643

)

Net change in unrealized loss on available-for-sale securities, net of reclassification adjustments and taxes

 

 

 

 

 

 

 

 

 

 

 

4

 

 

 

 

 

 

4

 

Balance at March 31, 2024

 

 

31,036

 

 

$

23

 

 

$

604,936

 

 

$

(10

)

 

$

(596,649

)

 

$

8,300

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2022

 

 

22,785

 

 

$

23

 

 

$

586,357

 

 

$

(13

)

 

$

(561,382

)

 

$

24,985

 

Issuance of common stock in the February 2023 registered direct offering

 

 

1,700

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense from stock options and ESPP shares

 

 

 

 

 

 

 

 

2,338

 

 

 

 

 

 

 

 

 

2,338

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(11,987

)

 

 

(11,987

)

Net change in unrealized loss on available-for-sale securities, net of reclassification adjustments and taxes

 

 

 

 

 

 

 

 

 

 

 

6

 

 

 

 

 

 

6

 

Balance at March 31, 2023

 

 

24,485

 

 

$

23

 

 

$

588,695

 

 

$

(7

)

 

$

(573,369

)

 

$

15,342

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these condensed financial statements

7


 

DURECT CORPORATION

CONDENSED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

 

Three months ended
March 31,

 

 

 

2024

 

 

2023

 

Cash flows from operating activities

 

 

 

 

 

 

Net loss

 

$

(7,643

)

 

$

(11,987

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Depreciation and accretion

 

 

51

 

 

 

44

 

Stock-based compensation

 

 

509

 

 

 

602

 

Change in fair value of warrant liabilities

 

 

1,718

 

 

 

(2,477

)

Loss on issuance of warrants

 

 

 

 

 

2,033

 

Other

 

 

96

 

 

 

100

 

Changes in assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

241

 

 

 

2,022

 

Inventories

 

 

(180

)

 

 

(98

)

Prepaid expenses and other assets

 

 

283

 

 

 

109

 

Accounts payable

 

 

(995

)

 

 

(1,100

)

Accrued liabilities

 

 

(846

)

 

 

1,311

 

Deferred revenue

 

 

 

 

 

178

 

Total adjustments

 

 

877

 

 

 

2,724

 

Net cash used in operating activities

 

 

(6,766

)

 

 

(9,263

)

Cash flows from investing activities

 

 

 

 

 

 

Purchases of available-for-sale securities

 

 

(887

)

 

 

(4,924

)

Net cash used in investing activities

 

 

(887

)

 

 

(4,924

)

Cash flows from financing activities

 

 

 

 

 

 

Payments on term loan principal

 

 

(2,143

)

 

 

 

Net proceeds from issuances of common stock pursuant to the 2021 Sales Agreement

 

 

648

 

 

 

 

Proceeds from issuances of warrants and common stock

 

 

 

 

 

10,000

 

Net cash (used in) provided by financing activities

 

 

(1,495

)

 

 

10,000

 

Net decrease in cash, cash equivalents, and restricted cash

 

 

(9,148

)

 

 

(4,187

)

Cash, cash equivalents, and restricted cash, beginning of the period (1)

 

 

28,550

 

 

 

43,633

 

Cash, cash equivalents, and restricted cash, end of the period (1)

 

$

19,402

 

 

$

39,446

 

(1) Includes restricted cash of $150,000 included in long term restricted investments on the condensed balance sheets at March 31, 2024, December 31, 2023 and March 31, 2023, respectively.

 

The accompanying notes are an integral part of these condensed financial statements.

8


 

DURECT CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

Note 1. Summary of Significant Accounting Policies

Nature of Operations

DURECT Corporation (the “Company”) was incorporated in the state of Delaware on February 6, 1998. The Company is a biopharmaceutical company committed to transforming the treatment of acute organ injury and chronic liver diseases by advancing novel and potentially lifesaving therapies based on its endogenous epigenetic regulator program. Larsucosterol, the Company's lead drug candidate, binds to and inhibits the activity of DNA methyltransferases ("DNMTs"), epigenetic enzymes which are elevated and associated with hypermethylation found in alcohol-associated hepatitis ("AH") patients. Larsucosterol is in clinical development for the potential treatment of AH, for which FDA has granted a Fast Track Designation; metabolic dysfunction-associated steatohepatitis (“MASH”), also known as non-alcoholic steatohepatitis or NASH is also being explored. In addition, POSIMIR® (bupivacaine solution) for infiltration use, a non-opioid analgesic utilizing the innovative SABER® platform technology, is FDA-approved and has been exclusively licensed to Innocoll Pharmaceuticals for commercialization in the United States. The Company also manufactures and sells osmotic pumps used in laboratory research, and manufactures certain excipients for certain clients for use as raw materials in their products.

Basis of Presentation

These condensed financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”), and therefore do not include all the information and footnotes necessary for a complete presentation of the Company’s results of operations, financial position and cash flows in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). The unaudited condensed financial statements reflect all adjustments (consisting only of normal recurring adjustments) which are, in the opinion of management, necessary for a fair presentation of the financial position at March 31, 2024, the operating results and comprehensive loss, and stockholders’ equity for the three months ended March 31, 2024 and 2023, and cash flows for the three months ended March 31, 2024 and 2023. The balance sheet as of December 31, 2023 has been derived from audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These financial statements and notes should be read in conjunction with the Company’s audited financial statements and notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC.

The results of operations for the interim periods presented are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year.

Liquidity and Need to Raise Additional Capital

As of March 31, 2024, the Company had an accumulated deficit of $596.6 million as well as negative cash flows from operating activities. Presently, the Company does not have sufficient cash resources to meet its plans for the next twelve months following the issuance of these financial statements. The Company will continue to require substantial funds to continue research and development, including clinical trials of its product candidates. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. Management’s plans in order to meet its operating cash flow requirements include seeking additional collaborative agreements for certain of its programs as well as financing activities such as public offerings and private placements of its common stock, preferred stock offerings, issuances of debt and convertible debt instruments.

There are no assurances that such additional funding will be obtained and that the Company will succeed in its future operations. If the Company cannot successfully raise additional capital and implement its strategic development plan, its liquidity, financial condition and business prospects will be materially and adversely affected, and the Company may have to cease operations. As further described in Note 8, the Company classified the remaining balance of its term loan as a current liability on the Company’s balance sheet as of March 31, 2024 and December 31, 2023 due to the timing of repayment obligations and due to recurring losses, liquidity concerns and a subjective acceleration clause in the Company’s Loan Agreement. These financial statements have been prepared on a going concern basis and do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary in the event the Company can no longer continue as a going concern.

Inventories

Inventories are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. The Company capitalizes inventories produced in preparation for product launches after receiving regulatory approval on a product. The Company may be required to expense previously capitalized inventory costs upon a change in management’s judgment due to new information that suggests that the inventory will not be saleable.

9


 

The Company’s inventories consisted of the following (in thousands):

 

 

 

March 31,
2024

 

 

December 31,
2023

 

Raw materials

 

$

173

 

 

$

165

 

Work in process

 

 

1,060

 

 

 

1,164

 

Finished goods

 

 

1,165

 

 

 

890

 

Total inventories

 

$

2,398

 

 

$

2,219

 

 

Leases

ASC 842 requires the Company to recognize an operating lease right-of-use asset and corresponding operating lease liability for the Company’s leased properties. The Company’s operating lease right-of-use assets and liabilities are recognized under ASC 842 based on the present value of lease payments over the remaining lease term at the lease commencement date. In determining the net present value of lease payments, we estimate the incremental borrowing rate based on the information available, including remaining lease term. As of March 31, 2024, the weighted-average remaining lease term was 3.33 years for the Company’s leased properties.

Revenue Recognition

Product Revenue, Net

The Company manufactures and sells ALZET osmotic pumps used in laboratory research, and manufactures and sells certain excipients used by pharmaceutical companies as raw materials in certain of their products, including POSIMIR, a marketed animal health product and Methydur.

Revenues from product sales are recognized when the customer obtains control of the Company’s product, which occurs at a point in time, typically upon shipment to the customer. The Company expenses incremental costs of obtaining a contract as and when incurred if the expected amortization period of the asset that the Company would have recognized is one year or less.

Trade Discounts and Allowances: The Company provides certain customers with discounts that are explicitly stated in the Company’s contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized.

Product Returns: The Company generally offers customers a limited right of return for products that have been purchased. The Company estimates the amount of its product sales that are probable of being returned by its customers and records this estimate as a reduction of revenue in the period the related product revenue is recognized. The Company currently estimates product return liabilities primarily using its historical sales information. The Company expects product returns to be minimal.

Collaborative Research and Development and Other Revenue

The Company enters into license agreements, under which it licenses certain rights to its product candidates or products to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, up-front license fees; reimbursement of development costs incurred by the Company under approved work plans; development, regulatory, intellectual property and commercial milestone payments; payments for manufacturing supply services the Company provides itself or through its contract manufacturers; and royalties on net sales of licensed products. Each of these payments results in collaborative research and development revenues, except for revenues from royalties on net sales of licensed products and earn-out revenues, which are classified as other revenues.

In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. For arrangements that are determined to include multiple performance obligations, the Company must develop assumptions that require judgment to determine the estimated stand-alone selling price for each performance obligation identified. These assumptions may include: forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. The Company expects to recognize revenue for the variable consideration currently being constrained when it is probable that a significant revenue reversal will not occur.

10


 

Licenses of intellectual property: If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from the transaction price allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. For performance obligations comprised of licenses that are bundled with other promises, the Company utilizes its judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the Company applies an appropriate method of measuring progress for purposes of recognizing related revenues from the allocated transaction price. For performance obligations recognized over time, the Company evaluates the measure of progress each reporting period and recognizes revenues on a cumulative catch-up basis as collaborative research and development revenues.

Milestone Payments: At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development milestones and any related constraint, and if necessary, adjusts its estimate of the overall transaction price.

Manufacturing Supply Services: Arrangements that include a promise for future supply of raw materials or drug product for either clinical development or commercial supply at the customer’s discretion are generally considered as options. The Company assesses if these options provide a material right to the customer and if so, they are accounted for as separate performance obligations and allocated a portion of the transaction price based on the estimated standalone selling price of the material right. If the Company is entitled to additional payments when the customer exercises these options, the deferred transaction price and any additional payments are recorded in collaborative research and development revenue when the customer obtains control of the goods.

Royalties and Earn-outs: For arrangements that include sales-based royalties or earn-outs, including milestone payments based on first commercial sale or the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty or earn-out has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized material royalty revenue resulting from the Company’s collaborative arrangements or material earn-out revenues from any of the Company’s agreements.

Research and development services: Revenue from research and development services that are determined to represent a distinct performance obligation related to services performed under the collaborative arrangements with the Company’s third-party collaborators is recognized over time as the related research and development services are performed using an appropriate method of measuring progress. The Company evaluates the measure of progress each reporting period and recognizes revenue on a cumulative catch-up basis, as collaborative research and development revenue. Research and development expenses under the collaborative research and development agreements generally approximate or exceed the revenue recognized under such agreements over the term of the respective agreements. Deferred revenue may result when the Company does not expend the required level of effort during a specific period in comparison to funds received under the respective agreement.

The Company receives payments from its customers based on development cost schedules established in each contract. Up-front payments are recorded as deferred revenue upon receipt or when due and may require deferral of revenue recognition to a future period until the Company performs its obligations under these arrangements. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less.

Total revenue by geographic region based on customers’ locations for the three months ended March 31, 2024 and 2023 are as follows (in thousands):

 

 

 

Three months ended
March 31,

 

 

 

2024

 

 

2023

 

United States

 

$

973

 

 

$

1,278

 

Europe

 

 

543

 

 

 

431

 

Japan

 

 

147

 

 

 

170

 

Other

 

 

164

 

 

 

175

 

Total

 

$

1,827

 

 

$

2,054

 

 

11


 

Prepaid and Accrued Clinical Costs

The Company incurs significant costs associated with third party consultants and organizations for pre-clinical studies, clinical trials, contract research, regulatory advice and other research and development-related services. The Company is required to estimate periodically the cost of services rendered but unbilled based on management’s estimates. Estimates are determined each reporting period by reviewing the terms and conditions of the underlying contracts, reviewing open purchase orders and by having detailed discussions with internal clinical personnel and third-party service providers as to the nature and status of the services performed in relation to amounts billed. The costs for unbilled services are estimated by applying the rates and fees applicable in the underlying contracts. If these good faith estimates are inaccurate, actual expenses incurred could materially differ from these estimates.

Prepaid and Accrued Manufacturing Costs

The Company incurs significant costs associated with third party consultants and organizations for manufacturing, validation, testing and other research and development-related services. The Company is required to estimate periodically the cost of services rendered but unbilled based on management’s estimates. Estimates are determined each reporting period by reviewing the terms and conditions of the underlying contracts, reviewing open purchase orders and by having detailed discussions with internal personnel and third-party service providers as to the nature and status of the services performed in relation to amounts billed. The costs for unbilled services are estimated by applying the rates and fees applicable in the underlying contracts. If these good faith estimates are inaccurate, actual expenses incurred could materially differ from these estimates.

Research and Development Expenses

Research and development expenses are primarily comprised of salaries and benefits associated with research and development personnel, overhead and facility costs, preclinical and non-clinical development costs, clinical trial and related clinical manufacturing costs, contract services, and other outside costs. Research and development costs are expensed as incurred. Research and development costs paid to third parties under sponsored research agreements are recognized as the related services are performed. In addition, research and development expenses incurred that are reimbursed by the Company’s partners are recorded as collaborative research and development revenue.

Comprehensive Loss

Components of other comprehensive loss are comprised entirely of unrealized gains and losses on the Company’s available-for-sale securities for all periods presented. Total comprehensive loss has been disclosed in the Company’s Statements of Operations and Comprehensive Loss.

Common Stock Warrants

The Company accounts for its common stock warrants in accordance with ASC 480, Distinguishing Liabilities from Equity ("ASC 480") and ASC 815, Derivatives and Hedging (“ASC 815”). Based upon the provisions of ASC 480 and ASC 815, the Company accounts for common stock warrants and pre-funded warrants as current liabilities if the warrant fails the equity classification criteria. Common stock warrants and pre-funded warrants classified as liabilities are initially recorded at fair value on the grant date and remeasured at each balance sheet date with the offsetting adjustments recorded in change in fair value of warrant liabilities within the statements of operations.

The Company values its pre-funded warrants and common stock warrants classified as liabilities using the Black-Scholes option pricing model or other acceptable valuation models, including the Monte-Carlo simulation model.

Net Loss Per Share

Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding. Diluted net loss per share is computed using the weighted-average number of common shares outstanding and common stock equivalents (i.e., options to purchase common stock) outstanding during the period, if dilutive, using the treasury stock method for options.

12


 

The numerators and denominators in the calculation of basic and diluted net loss per share were as follows (in thousands except per share amounts):

 

 

 

Three months ended
March 31,

 

 

 

2024

 

 

2023

 

Basic loss per share computation:

 

 

 

 

 

 

Net loss

 

$

(7,643

)

 

$

(11,987

)

Weighted average number of shares outstanding - basic

 

 

30,637

 

 

 

23,767

 

Net loss per share - basic

 

$

(0.25

)

 

$

(0.50

)

 

 

 

 

 

 

 

Diluted loss per share computation:

 

 

 

 

 

 

Net loss

 

$

(7,643

)

 

$

(11,987

)

Change in fair value of pre-funded warrant liabilities

 

 

 

 

 

384

 

Net loss adjusted for change in fair value of warrant liabilities

 

$

(7,643

)

 

$

(12,371

)

 

 

 

 

 

 

 

Weighted average shares used to compute basic net loss per share

 

 

30,637

 

 

 

23,767

 

Dilutive effect of pre-funded warrants

 

 

 

 

 

173

 

Weighted average shares used to compute diluted net loss per share

 

 

30,637

 

 

 

23,940

 

Net loss per share - diluted

 

$

(0.25

)

 

$

(0.52

)

 

Options to purchase approximately 4.0 million and 3.0 million shares of common stock were excluded from the denominator in the calculation of diluted net loss per share for the three months ended March 31, 2024 and March 31, 2023, respectively, as the effect would be antidilutive. Additional common warrants to purchase 261,000 and 1.2 million shares were also outstanding during the three months ended March 31, 2024 and 2023, respectively, but were not included in the computation of diluted net loss per share because the effect would be anti-dilutive.

Recent Accounting Pronouncements

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07). The amendments in ASU 2023-07 are intended to improve reportable segment disclosure, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 15, 2024. The amendments in this ASU should be applied retrospectively to all prior periods presented in the financial statements. Early adoption is permitted. The Company is evaluating the impact of this guidance on its financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09). ASU 2023-09 requires enhanced annual disclosures regarding the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 and may be adopted on a prospective or retrospective basis. Early adoption is permitted. The Company is evaluating the impact of this guidance on its financial statements and related disclosures.

Note 2. Strategic Agreements

The collaborative research and development and other revenues associated with the Company’s collaborators or counterparties were $496,000 and $643,000 for the three months ended March 31, 2024 and 2023, respectively. The collaborative research and development and other revenue included (a) amounts related to earn-out revenue from Indivior UK Limited ("Indivior") with respect to PERSERIS net sales; (b) feasibility programs and research and development activities funded by our collaborators and (c) royalty revenue from Orient Pharma Co., Ltd. (“Orient Pharma”) with respect to Methydur net sales.

Agreement with Innocoll

On December 21, 2021, the Company entered into a license agreement (the “Innocoll Agreement”) with Innocoll Pharmaceuticals Limited (“Innocoll”). Pursuant to the Innocoll Agreement, the Company has granted Innocoll an exclusive, royalty-bearing, sublicensable right and license to develop, manufacture and commercialize in the United States, POSIMIR®, the Company’s FDA-approved post-surgical pain product, with respect to all uses and applications in humans. The Innocoll Agreement provides for the assignment of the Company’s supply agreement with its contract manufacturing organization to Innocoll and also provides Innocoll with the right, within the United States, to expand the approved indications of POSIMIR. The Company retains, outside the United States, all of the global rights to POSIMIR.

13


 

The Company receives tiered, low double-digit to mid-teen royalties on net product sales of POSIMIR in the United States. The Company may earn additional milestone payments of up to $122.0 million in the aggregate, depending on the achievement of certain regulatory, commercial, and intellectual property milestones with respect to POSIMIR. There were no revenues recognized related to the Innocoll Agreement for the three-month periods ending March 31, 2024 and 2023.

Patent Purchase Agreement with Indivior

In September 2017, we entered into an agreement with Indivior (the “Indivior Agreement”), under which we assigned to Indivior certain patents that may provide further intellectual property protection for PERSERIS, Indivior’s extended-release injectable suspension for the treatment of schizophrenia in adults. In consideration for such assignment, Indivior made non-refundable upfront and milestone payments to DURECT totaling $17.5 million. Additionally, under the terms of the agreement with Indivior, the Company receives quarterly earn-out payments into 2026 that are based on a single digit percentage of U.S. net sales of PERSERIS. Indivior commercially launched PERSERIS in the U.S. in February 2019. The Indivior Agreement contains customary representations, warranties and indemnities of the parties. Amounts recognized during the three months ended March 31, 2024 and 2023 related to earn-out revenues from PERSERIS have been immaterial and are included in collaborative research and development and other revenue.

Note 3. Financial Instruments

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company’s valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company follows a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value. These levels of inputs are the following:

Level 1—Quoted prices in active markets for identical assets or liabilities.
Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s financial instruments are valued using quoted prices in active markets or based upon other observable inputs. Money market funds are classified as Level 1 financial assets. Certificates of deposit, commercial paper, municipal bonds, corporate debt securities, and U.S. Government agency securities are classified as Level 2 financial assets. The fair value of the Level 2 assets is estimated using pricing models using current observable market information for similar securities. The Company’s Level 2 investments include U.S. government-backed securities and corporate securities that are valued based upon observable inputs that may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data including market research publications. The fair value of commercial paper is based upon the time to maturity and discounted using the three-month treasury bill rate. The average remaining maturity of the Company’s Level 2 investments as of March 31, 2024 is less than twelve months and these investments are rated by S&P and Moody’s at AAA or AA- for securities and A1, A2, P1 or P2 for commercial paper.

The following is a summary of available-for-sale securities as of March 31, 2024 and December 31, 2023 (in thousands):

 

 

 

March 31,
2024

 

 

 

Amortized
Cost

 

 

Unrealized
Gain

 

 

Unrealized
Loss

 

 

Estimated
Fair
Value

 

Money market funds

 

$

62

 

 

$

 

 

$

 

 

$

62

 

Certificates of deposit

 

 

150

 

 

 

 

 

 

 

 

 

150

 

Commercial paper

 

 

17,713

 

 

 

 

 

 

(10

)

 

 

17,703

 

 

 

$

17,925

 

 

$

 

 

$

(10

)

 

$

17,915

 

Reported as:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

15,587

 

 

$

 

 

$

(9

)

 

$

15,578

 

Short-term investments

 

 

2,188

 

 

 

 

 

 

(1

)

 

 

2,187

 

Long-term restricted investments

 

 

150

 

 

 

 

 

 

 

 

 

150

 

 

 

$

17,925

 

 

$

 

 

$

(10

)

 

$

17,915

 

 

14


 

 

 

 

December 31, 2023

 

 

 

Amortized
Cost

 

 

Unrealized
Gain

 

 

Unrealized
Loss

 

 

Estimated
Fair
Value

 

Money market funds

 

$

951

 

 

$

 

 

$

 

 

$

951

 

Certificates of deposit

 

 

150

 

 

 

 

 

 

 

 

 

150

 

Commercial paper

 

 

24,896

 

 

 

 

 

 

(14

)

 

 

24,882

 

 

$

25,997

 

 

$

 

 

$

(14

)

 

$

25,983

 

Reported as:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

24,566

 

 

$

 

 

$

(13

)

 

$

24,553

 

Short-term investments

 

 

1,281

 

 

 

 

 

 

(1

)

 

 

1,280

 

Long-term restricted investments

 

 

150

 

 

 

 

 

 

 

 

 

150

 

 

$

25,997

 

 

$

 

 

$

(14

)

 

$

25,983

 

 

The following is a summary of the cost and estimated fair value of available-for-sale securities at March 31, 2024, by contractual maturity (in thousands):

 

 

 

March 31,
2024

 

 

 

Amortized
Cost

 

 

Estimated
Fair
Value

 

Mature in one year or less

 

$

17,713

 

 

$

17,703

 

Mature after one year through five years

 

 

150

 

 

 

150

 

 

$

17,863

 

 

$

17,853

 

 

There were no securities that have had an unrealized loss for more than 12 months as of March 31, 2024.

As of March 31, 2024, unrealized losses on available-for-sale investments are not attributed to credit risk and are considered to be temporary. The Company believes that it is more-likely-than-not that investments in an unrealized loss position will be held until maturity or the recovery of the cost basis of the investment. To date, the Company has not recorded any impairment charges on marketable securities related to other-than-temporary declines in market value.

Warrant Liabilities

The following table summarizes the activity of the Company’s Level 3 warrant liabilities during the three months ended March 31, 2024 and 2023 (in thousands):

 

 

 

Three months ended
March 31,

 

 

 

2024

 

 

2023

 

Fair value at beginning of period - February 2023 issuance (Pre-funded warrants)

 

$

 

 

$

 

Initial fair value at the original issuance date

 

 

 

 

 

1,743

 

Change in fair value during the period

 

 

 

 

 

(384

)

Fair value at end of period - February 2023 issuance (Pre-funded warrants)

 

$

 

 

$

1,359

 

 

 

 

 

 

 

 

Fair value at beginning of period - February 2023 issuance (Common warrants)

 

$

312

 

 

$

 

Initial fair value at the original issuance date

 

 

 

 

 

10,290

 

Change in fair value during the period

 

 

360

 

 

 

(2,093

)

Fair value at beginning of period - February 2023 issuance (Common warrants)

 

$

672

 

 

$

8,197

 

 

 

 

 

 

 

 

Fair value at beginning of period - July 2023 issuance (Common warrants)

 

$

912

 

 

$

 

Change in fair value during the period

 

 

1,358

 

 

 

 

Fair value at end of period - July 2023 issuance

 

$

2,270

 

 

$

 

 

 

 

 

 

 

 

Total fair value at end of period

 

$

2,942

 

 

$

9,556

 

 

 

 

 

 

 

 

 

15


 

February 2023 Warrants

In February 2023, the Company issued pre-funded warrants to purchase an aggregate of 300,000 shares of common stock and common warrants to purchase an aggregate of 2,000,000 shares of common stock in a registered direct offering.

Pre-Funded Warrants

The pre-funded warrants were accounted for as current liabilities on the balance sheet and were adjusted to estimated fair value at period end through “other income (expense)” on the statement of operations. The estimated fair value of the outstanding pre-funded warrants was $1.7 million, zero and zero as of February 8, 2023 (i.e., the issuance date), December 31, 2023 and March 31, 2024, respectively. In November 2023, all 300,000 shares of the pre-funded warrants were exercised in accordance with the financing agreement, resulting in an issuance of 300,000 shares of common stock to the holder. The Company calculated the estimated fair value of the pre-funded warrants using a Black-Scholes option pricing model with the following key assumptions:

 

 

 

February 8, 2023 (issuance)

 

 

Common stock price

 

$

5.81

 

 

Exercise price per share

 

$

0.00001

 

 

Expected volatility

 

 

86.60

%

 

Risk-free interest rate

 

 

3.82

%

 

Contractual term (in years)

 

 

5.00

 

 

Expected dividend yield

 

 

%

 

 

Common Warrants

The common warrants are accounted for as current liabilities on the balance sheet and are adjusted to estimated fair value at period end through “other income (expense)” on the statement of operations. The estimated fair value of the outstanding common warrants was $10.3 million, $312,000 and $672,000 as of February 8, 2023 (i.e., the issuance date), December 31, 2023 and March 31, 2024, respectively. In September 2023, 1,400,000 shares of the common warrants were exercised through the alternative cashless exercise provision in accordance with the financing agreement, resulting in a net issuance of 924,000 shares to the holder. The aggregate number of shares of our common stock issuable in such alternative cashless exercise equals the product of (x) the aggregate number of shares of our common stock that would be issuable upon exercise of the common warrant in accordance with the terms of such common warrant if such exercise were by means of a cash exercise rather than a cashless exercise and (y) 0.66. The Company calculated the estimated fair value of the common warrants using a Monte Carlo simulation model with the following key assumptions. The Company took the likelihood of achieving certain clinical events and related impact on the Company's common stock price into account, as appropriate.

The exercise price for the outstanding common warrants (i.e., 600,000 shares) was adjusted down from $5.00 per share to $0.51 per share as of December 31, 2023 as a result of an anti-dilution provision in the common warrants issued in the February 2023 financing that was triggered by the sale of our common stock in the open market in November 2023. There were 600,000 shares of outstanding common warrants as of March 31, 2024.

 

 

 

February 8, 2023 (issuance)

 

 

March 31,2023

 

 

December 31, 2023

 

 

March 31,2024

 

Common stock price

 

$

5.81

 

 

$

4.53

 

 

$

0.59

 

 

$

1.21

 

Exercise price per share

 

$

5.00

 

 

$

5.00

 

 

$

0.51

 

 

$

0.51

 

Expected volatility

 

 

86.60

%

 

 

86.20

%

 

 

118.00

%

 

 

115.00

%

Risk-free interest rate

 

 

3.82

%

 

 

3.65

%

 

 

3.93

%

 

 

4.31

%

Contractual term (in years)

 

 

5.00

 

 

 

4.90

 

 

 

4.10

 

 

 

3.90

 

Expected dividend yield

 

 

%

 

 

%

 

 

%

 

 

%

 

July 2023 warrants

In July 2023, the Company issued common warrants to purchase an aggregate of 2,991,027 shares of common stock in a registered direct offering.

16


 

The common warrants are accounted for as current liabilities on the balance sheet and are adjusted to estimated fair value at period end through “other income (expense)” on the statement of operations. The estimated fair value of the outstanding common warrants was $5.8 million, $912,000 and $2.3 million as of July 21, 2023 (i.e., the issuance date), December 31, 2023 and March 31, 2024, respectively. The Company calculated the estimated fair value of the common warrants using a Black-Scholes option pricing model with the following key assumptions:

 

 

 

 

 

 

 

 

 

 

 

 

 

July 21, 2023 (issuance)

 

 

December 31, 2023

 

 

March 31, 2024

 

Common stock price

 

$

3.05

 

 

$

0.59

 

 

$

1.21

 

Exercise price per share

 

$

4.89

 

 

$

4.89

 

 

$

4.89

 

Expected volatility

 

 

88.60

%

 

 

115.60

%

 

 

115.93

%

Risk-free interest rate

 

 

4.18

%

 

 

3.88

%

 

 

4.26

%

Contractual term (in years)

 

 

5.00

 

 

 

4.60

 

 

 

4.30

 

Expected dividend yield

 

 

%

 

 

%

 

 

%

 

There were no exercises of the common warrants issued in the July 2023 registered direct offering.

Note 4. Accrued Liabilities

Accrued liabilities as of March 31, 2024 and December 31, 2023 were comprised as follows (in thousands):

 

 

 

March 31,
2024

 

 

December 31,
2023

 

Accrued compensation and benefits

 

$

1,534

 

 

$

1,320

 

Accrued contract research and manufacturing costs

 

 

2,704

 

 

 

2,340

 

Accrued clinical costs

 

 

78

 

 

 

1,578

 

Others

 

 

789

 

 

 

728

 

Total

 

$

5,105

 

 

$

5,966

 

 

Note 5. Stock-Based Compensation

As of March 31, 2024, the Company has two stock-based compensation plans. The stock-based compensation cost that has been included in the statements of operations and comprehensive loss is shown as below (in thousands):

 

 

 

Three months ended
March 31,

 

 

 

2024

 

 

2023

 

Cost of product revenues

 

$

4

 

 

$

4

 

Research and development

 

 

212

 

 

 

292

 

Selling, general and administrative

 

 

293

 

 

 

306

 

Total stock-based compensation

 

$

509

 

 

$

602

 

 

As of March 31, 2024 and December 31, 2023, $14,000 of stock-based compensation cost was capitalized in inventory on the Company’s balance sheets for each period, respectively.

The Company uses the Black-Scholes option pricing model to value its stock options. The expected life computation is based on historical exercise patterns and post-vesting termination behavior. The Company considered its historical volatility in developing its estimate of expected volatility.

The Company used the following assumptions to estimate the fair value of stock options granted and shares purchased under its employee stock purchase plan for the three months ended March 31, 2024 and 2023. There were no stock options granted for the three months ended March 31, 2024.

 

 

Three months ended
March 31,

 

 

 

2024

 

 

2023

 

Stock Options

 

 

 

 

 

 

Risk-free rate

 

 

 

 

4.05-4.07%

 

Expected dividend yield

 

 

 

 

 

 

Expected life of option (in years)

 

 

 

 

7.0-7.5

 

Volatility

 

 

 

 

87-88%

 

 

17


 

 

 

 

Three months ended
March 31,

 

 

 

2024

 

 

2023

 

Employee Stock Purchase Plan

 

 

 

 

 

 

Risk-free rate

 

 

5.5

%

 </