Appointed Kemi Olugemo, M.D., FANN as Chief Medical Officer CAMBRIDGE, Mass., May 14, 2024 (GLOBE NEWSWIRE) -- Korro Bio, Inc. (Korro) (NASDAQ:KRRO), a biopharmaceutical company focused on developing a new class of genetic medicines based on editing RNA for both rare and highly prevalent diseases, today reported financial results for the first quarter of 2024 and provided an update on its recent progress and anticipated milestones. On track for regulatory filing for First-in-Human (FIH) study of KRRO-110 in ...

Financing led by Deep Track Capital with participation from other leading healthcare investors Pro-forma cash and cash equivalents of approximately $236 million before fees and expenses On track for regulatory filing for First-in-Human (FIH) study of KRRO-110 in Alpha-1 Antitrypsin Deficiency (AATD) patients anticipated in the second half of 2024Proceeds fund interim readout in the second half of 2025 and FIH study completion in 2026 for KRRO-110 CAMBRIDGE, Mass., April 18, 2024 (GLOBE NEWSWIRE) -- Korro Bi ...

Korro Reports Full Year 2023 Financial Results and Highlights Recent Progress Exhibit 99.1 - On track for regulatory filing for First-in-Human study of KRRO-110 in Alpha-1 Antitrypsin Deficiency (AATD) patients anticipated in the second half of 2024 - Demonstrated the versatility of Korro's RNA editing platform by generating de-novo protein variants via multiple targets in non-human primates (NHPs) - Demonstrated greater than 50% editing using GalNAc conjugates in the liver with subcutaneous administration ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 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 001-39062 Korro Bio, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organiz ...

PART I. FINANCIAL INFORMATION This section presents the company's unaudited financial statements, management's discussion, and related disclosures [Item 1. Consolidated Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20%28Unaudited%29) Unaudited Q3 2023 financials show reduced assets, liabilities, and net loss, driven by restructuring and debt repayment [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) Total assets and liabilities significantly decreased by September 30, 2023, primarily due to lower cash and debt repayment Consolidated Balance Sheet Highlights (in thousands) | Account | September 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $41,723 | $51,954 | | Total current assets | $42,500 | $87,493 | | Total assets | $46,349 | $121,238 | | **Liabilities & Equity** | | | | Total current liabilities | $9,612 | $21,026 | | Total liabilities | $9,612 | $52,043 | | Total stockholders' equity | $36,737 | $69,195 | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) Net loss significantly narrowed for Q3 and nine months 2023, driven by reduced research and development expenses Consolidated Statement of Operations Summary (in thousands, except per share data) | Metric | Q3 2023 | Q3 2022 | Nine Months 2023 | Nine Months 2022 | | :--- | :--- | :--- | :--- | :--- | :--- | | Research and development | $2,560 | $11,715 | $18,509 | $38,769 | | General and administrative | $10,105 | $8,560 | $26,498 | $26,037 | | Loss from operations | $(12,665) | $(20,275) | $(45,007) | $(64,806) | | Net loss | $(11,614) | $(19,547) | $(41,953) | $(64,218) | | Net loss per share | $(0.31) | $(0.55) | $(1.17) | $(1.83) | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Cash flows for nine months 2023 show reduced operating cash burn, increased investing cash, and cash used in financing Cash Flow Summary for Nine Months Ended September 30 (in thousands) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(27,358) | $(42,618) | | Net cash provided by investing activities | $31,528 | $6,573 | | Net cash (used in) provided by financing activities | $(14,133) | $256 | | **Net decrease in cash, cash equivalents and restricted cash** | **$(9,963)** | **$(35,789)** | [Notes to Unaudited Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Notes detail corporate events including the Korro Bio merger, program discontinuation, debt repayment, and restructuring charges - On July 14, 2023, the company entered into a Merger Agreement with **Korro Bio, Inc.**, which will become a wholly owned subsidiary[29](index=29&type=chunk) - The company announced a restructuring in February 2023, discontinuing its hearing program and reducing its workforce by approximately **55%**, followed by another **55%** reduction in May 2023[29](index=29&type=chunk) - On April 3, 2023, the company prepaid the remaining **$11.7 million** due under its Loan Agreement with **Silicon Valley Bank**[47](index=47&type=chunk) - During 2023, the company terminated its collaboration agreement with Astellas and license agreements with MIT, MEE, and CALIBR, with no resulting payments or costs[72](index=72&type=chunk)[76](index=76&type=chunk)[80](index=80&type=chunk) - The company incurred **$4.3 million** in restructuring-related expenses in the nine months ended September 30, 2023, primarily from severance and benefit costs[96](index=96&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses strategic shifts, including program discontinuation, workforce reductions, and their impact on expenses and liquidity - In February 2023, the company discontinued its FX-322 and FX-345 hearing development programs after the FX-322-208 study failed to meet its primary endpoint[101](index=101&type=chunk) - The company executed multiple workforce reductions in 2022 and 2023 to align with its new strategic focus and preserve capital[102](index=102&type=chunk) - As of September 30, 2023, the company had an **accumulated deficit** of **$303.6 million** and cash, cash equivalents, and marketable securities of **$41.7 million**[105](index=105&type=chunk)[147](index=147&type=chunk) - Following the merger with **Korro Bio**, the business of the combined company will focus on **Korro Bio's** programs, and Frequency does not expect further development of its own product candidates[106](index=106&type=chunk)[153](index=153&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) Operating expenses significantly decreased for Q3 and nine months 2023, driven by reduced R&D offset by higher G&A Comparison of Operating Expenses (in thousands) | Expense Category | Q3 2023 | Q3 2022 | Change | Nine Months 2023 | Nine Months 2022 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Research and development | $2,560 | $11,715 | $(9,155) | $18,509 | $38,769 | $(20,260) | | General and administrative | $10,105 | $8,560 | $1,545 | $26,498 | $26,037 | $461 | | **Total operating expenses** | **$12,665** | **$20,275** | **$(7,610)** | **$45,007** | **$64,806** | **$(19,799)** | - The decrease in R&D costs is directly attributed to the discontinuation of the FX-322 and FX-345 programs in Q1 2023[124](index=124&type=chunk)[125](index=125&type=chunk) - The increase in G&A expenses was primarily due to higher professional service fees, particularly legal fees[128](index=128&type=chunk)[141](index=141&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is supported by $41.7 million in cash, with key events including debt prepayment and ATM program termination - Cash, cash equivalents and marketable securities totaled **$41.7 million** as of September 30, 2023[147](index=147&type=chunk) - In April 2023, the company prepaid the remaining **$11.7 million** on its term loan[148](index=148&type=chunk) - The company's ATM Program was terminated on September 26, 2023. No shares were sold under the program in 2023[149](index=149&type=chunk) - Restructuring in February 2023 related to program discontinuation and a **55%** staff reduction incurred costs of approximately **$4.3 million**[151](index=151&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This disclosure is not required as the company is a smaller reporting company - The company is a smaller reporting company and is **not required** to provide this information[171](index=171&type=chunk) [Item 4. Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of September 30, 2023, with no material changes to internal controls - Management concluded that as of September 30, 2023, the company's disclosure controls and procedures were **effective at a reasonable assurance level**[173](index=173&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[174](index=174&type=chunk) PART II. OTHER INFORMATION This section covers legal proceedings, risk factors, equity sales, and other required disclosures [Item 1. Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 15 of the financial statements for legal contingencies - For information on legal proceedings, the report directs readers to Note 15, "Commitments and contingencies – Legal Contingencies"[176](index=176&type=chunk) [Item 1A. Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) The company incorporates prospectus risk factors by reference, highlighting its history of significant losses and anticipated unprofitability - The company has incurred **significant losses** since inception and had an **accumulated deficit** of **$303.6 million** as of September 30, 2023[178](index=178&type=chunk) - Frequency is a preclinical-stage company that is **not profitable** and expects to continue incurring **significant operating losses** for the foreseeable future[178](index=178&type=chunk)[179](index=179&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=34&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) No material change in the use of net proceeds from the October 2019 IPO was reported - There has been **no material change** in the use of the approximately **$79.7 million** in net proceeds from the company's October 2019 IPO[181](index=181&type=chunk)[182](index=182&type=chunk) [Item 3. Defaults Upon Senior Securities](index=34&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) None reported - **None reported** [Item 4. Mine Safety Disclosures](index=34&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Not applicable - **Not applicable** [Item 5. Other Information](index=34&type=section&id=Item%205.%20Other%20Information) Not applicable - **Not applicable** [Item 6. Exhibits](index=35&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the report, including the Korro Bio merger agreement and officer certifications

Financial Performance - Net loss for the three months ended June 30, 2023, was $10,796 thousand, compared to a net loss of $21,285 thousand for the same period in 2022, representing a 49.1% improvement[17]. - The company reported a comprehensive loss of $10,738 thousand for the three months ended June 30, 2023, compared to a comprehensive loss of $21,381 thousand for the same period in 2022, a reduction of 49.8%[20]. - Net loss for the six months ended June 30, 2023, was $30.3 million, a reduction of $14.3 million (32.1%) from a net loss of $44.7 million in the prior year[132]. - The basic and diluted net loss per share for the six months ended June 30, 2023, was $(0.85), down from $(1.28) for the same period in 2022[48]. - The net losses for the three and six months ended June 30, 2023, were $10.8 million and $30.3 million, respectively, with an accumulated deficit of $292.0 million as of June 30, 2023[105]. Assets and Liabilities - Total current assets decreased by 44.5% from $87,493 thousand on December 31, 2022, to $48,379 thousand on June 30, 2023[14]. - Cash and cash equivalents decreased from $51,954 thousand on December 31, 2022, to $39,712 thousand on June 30, 2023, a decline of 23.4%[14]. - Total liabilities decreased by 34.8% from $52,043 thousand on December 31, 2022, to $33,975 thousand on June 30, 2023[14]. - Total stockholders' equity decreased from $69,195 thousand on December 31, 2022, to $45,408 thousand on June 30, 2023, a decline of 34.4%[14]. - The company had cash, cash equivalents, and restricted cash of $41,672 thousand at the end of the period, down from $44,072 thousand at the same time last year[26]. Operating Expenses - Total operating expenses for the three months ended June 30, 2023, were $11.8 million, a decrease of $9.4 million compared to $21.3 million for the same period in 2022[121]. - Research and development expenses for the three months ended June 30, 2023, were $4.6 million, down from $13.3 million in the same period in 2022, reflecting a decrease of $8.7 million[121]. - General and administrative expenses for the three months ended June 30, 2023, were $7.2 million, a decrease of $0.8 million from $8.0 million in the same period in 2022[127]. - Total operating expenses for the six months ended June 30, 2023, were $32.3 million, a decrease of $12.2 million (27.4%) compared to $44.5 million in the same period of 2022[132]. - Research and development expenses totaled $15.9 million for the six months ended June 30, 2023, down $11.1 million (41.1%) from $27.1 million in 2022[133]. Cash Flow - Net cash used in operating activities for the six months ended June 30, 2023, was $22,556 thousand, compared to $30,821 thousand for the same period in 2022, a decrease of 26.9%[26]. - Cash, cash equivalents, and marketable securities totaled $46.5 million as of June 30, 2023[145]. - Interest income for the three months ended June 30, 2023, was $0.3 million, compared to $0.4 million for the same period in 2022[128]. - There was no interest expense for the three months ended June 30, 2023, compared to $0.2 million for the same period in 2022, due to loan prepayment[129]. - Interest income increased to $0.9 million for the six months ended June 30, 2023, compared to $0.5 million in the same period of 2022, reflecting changes in investment balances[140]. Workforce and Restructuring - The Company underwent a restructuring in February and May 2023, resulting in a personnel reduction of approximately 55%[28]. - The Company announced a reduction in force of approximately 55% of its workforce following the failure of the FX-322 Phase 2b study to achieve its primary efficacy endpoint[94]. - The company announced a reduction in force of approximately 55% of its workforce in February 2023, with total restructuring costs of approximately $4.3 million[149]. - The Company incurred $4,329 in restructuring-related expenses in the six months ended June 30, 2023, including $3,840 in severance and other benefit-related costs[95]. Strategic Initiatives - The Company expects to continue generating operating losses for the foreseeable future, relying on its ability to raise additional capital[29]. - The Company plans to focus on developing a product candidate for remyelination in multiple sclerosis following the discontinuation of the FX-322 and FX-345 programs[102]. - The company is focusing on pursuing strategic alternatives for its MS Program and expects research and development expenses to relate to this initiative for the remainder of 2023[112]. - The Company entered into a Merger Agreement with Korro Bio on July 14, 2023, with Korro Bio becoming a wholly owned subsidiary[98]. - Following the merger agreement on July 14, 2023, the company does not expect any further development of its product candidates or programs[151]. Terminations and Agreements - The company terminated the Astellas Agreement on April 14, 2023, with no payments or costs incurred as a result of this termination[71]. - The Company terminated the CALIBR License Agreement in April 2023 without any associated payments or costs[76]. - The Company also terminated the MEE License Agreement in April 2023, incurring no payments or costs as a result[78]. - The company terminated several license agreements, including the Astellas Agreement and the MIT License, with no associated payments or costs due to these terminations[107][108]. Market and Risk Factors - The company has not experienced any material changes to its critical accounting policies during the six months ended June 30, 2023, compared to the previous year[164]. - The company has incorporated risk factors from its Registration Statement on Form S-4 filed with the SEC on July 27, 2023[174]. - The company is classified as a smaller reporting company and is not required to provide certain disclosures under Regulation S-K[179]. - The company has not disclosed any quantitative and qualitative disclosures about market risk as it is considered a small reporting company[168].

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 March 31, 2023 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: 001-39062 FREQUENCY THERAPEUTICS, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 47-2324450 (State or other jur ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K Delaware 47-2324450 (State or Other Jurisdiction of Incorporation or Organization) (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 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 001-39062 FREQUENCY THERAPEUTICS, INC. (Exact Name of ...

Financial Performance - The company reported no revenue for the three months ended September 30, 2022, compared to $14,068,000 for the same period in 2021[20]. - For the nine months ended September 30, 2022, the net loss was $64,218,000, compared to a net loss of $63,186,000 for the same period in 2021, indicating a slight increase in losses year-over-year[29]. - The company reported a net loss per share of $1.83 for the nine months ended September 30, 2022, compared to $1.84 for the same period in 2021, indicating a stable loss per share[51]. - The company reported a comprehensive loss of $19,531,000 for the three months ended September 30, 2022, compared to a comprehensive loss of $25,159,000 for the same period in 2021, indicating an improvement of approximately 22%[23]. - The company reported net losses of $64.2 million and $84.7 million for the nine months ended September 30, 2022, and the year ended December 31, 2021, respectively[145]. Assets and Liabilities - Total current assets decreased from $134,748,000 on December 31, 2021, to $100,990,000 on September 30, 2022, a decline of approximately 25%[17]. - Cash and cash equivalents decreased from $79,635,000 on December 31, 2021, to $43,846,000 on September 30, 2022, a reduction of approximately 45%[17]. - The accumulated deficit increased from $180,085,000 on December 31, 2021, to $244,303,000 on September 30, 2022, reflecting a rise of about 36%[17]. - The company had total liabilities of $54,040,000 as of September 30, 2022, compared to $54,534,000 on December 31, 2021, showing a slight decrease of about 1%[17]. - Cash, cash equivalents, and restricted cash at the end of the period were $45,545,000, down from $113,760,000 at the end of the same period in 2021, indicating a significant decrease in liquidity[29]. Operating Expenses - Total operating expenses for the three months ended September 30, 2022, were $20,275,000, down from $24,990,000 in the same period of 2021, representing a decrease of about 19%[20]. - Research and development expenses for the nine months ended September 30, 2022, were $38,769,000, down from $48,169,000 for the same period in 2021, a decrease of about 19%[20]. - General and administrative expenses for the three months ended September 30, 2022, were $8.6 million, down $0.8 million from $9.3 million in 2021[187]. - Total operating expenses for the nine months ended September 30, 2022, were $64.8 million, down $11.9 million from $76.7 million in 2021[195]. - General and administrative expenses were $26.0 million for the nine months ended September 30, 2022, a decrease of $2.5 million from $28.6 million in 2021[201][202]. Cash Flow - Net cash used in operating activities for the nine months ended September 30, 2022, was $42,618,000, a decrease from $58,171,000 in the prior year, reflecting improved cash flow management[29]. - The company had net cash provided by investing activities of $6,573,000 for the nine months ended September 30, 2022, a significant improvement from a net cash used of $51,479,000 in the prior year[29]. - Cash, cash equivalents, and marketable securities totaled $99.3 million as of September 30, 2022, expected to fund operations into 2024[210]. Stock and Equity - The weighted-average shares of common stock outstanding increased from 34,448,746 for the three months ended September 30, 2021, to 35,247,680 for the same period in 2022, an increase of approximately 2%[20]. - The company had 35,262,233 shares of common stock issued and outstanding as of September 30, 2022, an increase from 34,611,213 shares as of December 31, 2021[53]. - The company sold 12,767 shares of common stock under the ATM program for net proceeds of approximately $50,000 during the nine months ended September 30, 2022[58]. - The company recognized stock-based compensation of $5,994,000 for the nine months ended September 30, 2022, compared to $7,393,000 for the same period in 2021[70]. - The total unrecognized stock-based compensation expense relating to unvested stock options and restricted stock units was $23,888,000, expected to be recognized over a weighted-average period of 1.72 years[70]. Research and Development - Research and development expenses for the three months ended September 30, 2022, were $11.7 million, a decrease of $3.9 million from $15.7 million in 2021[180]. - The company incurred $2.9 million in costs related to FX-322 for the three months ended September 30, 2022, primarily for clinical costs associated with ongoing trials[183]. - FX-322, the Company's lead product candidate, showed a statistically significant improvement in word recognition scores in a Phase 1/2 clinical trial with 23 subjects[133]. - In the Phase 2a clinical trial, four weekly injections of FX-322 did not demonstrate improvements in hearing measures versus placebo, attributed to uncontrolled bias[134]. - The safety profile of FX-322 has been favorable across multiple clinical trials, with no treatment-related serious adverse events reported[136]. Future Outlook - The company expects to continue generating operating losses for the foreseeable future, emphasizing the need for additional capital to finance operations[33]. - The company plans to reduce its workforce by approximately 30% to align with business needs and focus on R&D programs[142]. - The prolonged COVID-19 pandemic may adversely impact the company's ability to raise additional capital and conduct clinical trials[149]. - The company is unable to estimate potential losses related to ongoing legal proceedings, including class action lawsuits filed against it[123].

Financial Performance - Revenue for the three months ended June 30, 2022, was $0, compared to $9,417,000 for the same period in 2021, indicating a 100% decrease[19]. - The company had no revenue for the six months ended June 30, 2022, compared to $14,068,000 for the same period in 2021, indicating a 100% decrease[19]. - Net loss for the six months ended June 30, 2022, was $44,671,000, compared to a net loss of $38,031,000 for the same period in 2021, reflecting an increase in loss of approximately 17.5%[23]. - The net loss for the three months ended June 30, 2022, was $21,285, compared to a net loss of $17,656 for the same period in 2021, reflecting a year-over-year increase of approximately 9.2%[50]. - For the six months ended June 30, 2022, the net loss was $44,671, up from $38,031 in the same period of 2021, representing an increase of about 17.4%[50]. Assets and Cash Flow - Total assets decreased from $185,358,000 on December 31, 2021, to $149,658,000 on June 30, 2022, representing a decline of approximately 19.2%[17]. - Cash and cash equivalents decreased from $79,635,000 on December 31, 2021, to $42,373,000 on June 30, 2022, a reduction of about 46.8%[17]. - The company reported a net cash used in operating activities of $30,821,000 for the six months ended June 30, 2022, compared to $43,148,000 for the same period in 2021, a reduction of about 28.5%[29]. - Cash, cash equivalents, and marketable securities totaled $111.0 million as of June 30, 2022, expected to fund operations into 2024[209]. Operating Expenses - Total operating expenses for the three months ended June 30, 2022, were $21,273,000, down from $26,900,000 in the same period of 2021, a decrease of approximately 21.1%[19]. - Total operating expenses decreased to $44.5 million for the six months ended June 30, 2022, down from $51.8 million in 2021, representing a reduction of $7.2 million[193]. - Research and development expenses totaled $27.1 million for the six months ended June 30, 2022, a decrease of $5.5 million from $32.5 million in 2021[196]. - General and administrative expenses were $17.5 million for the six months ended June 30, 2022, down $1.8 million from $19.3 million in 2021[200]. Stockholder Equity and Shares - Stockholders' equity decreased from $130,824,000 on December 31, 2021, to $95,853,000 on June 30, 2022, a decline of approximately 26.7%[17]. - The weighted-average shares of common stock outstanding increased from 34,238,394 for the three months ended June 30, 2021, to 34,976,409 for the same period in 2022, an increase of approximately 2.2%[19]. - The company has authorized 200,000,000 shares of common stock, with 34,976,409 shares issued and outstanding as of June 30, 2022[54]. Research and Development - The company is focused on developing FX-322 to treat sensorineural hearing loss (SNHL), with a goal to help millions of people[127]. - In the Phase 1/2 clinical trial (FX-322-201), 23 subjects showed a statistically significant improvement in word recognition scores, with 34% achieving a 10% or greater absolute improvement[128][130]. - The Phase 2a clinical trial (FX-322-202) did not demonstrate improvements in hearing measures compared to placebo, raising concerns about the reliability of baseline scores[129]. - The company expects research and development expenses to continue to increase substantially as it conducts ongoing clinical trials and develops additional product candidates[162]. Financing and Capital Needs - The company expects to continue generating operating losses for the foreseeable future, emphasizing the need for additional capital to finance operations[32]. - Additional financing will be necessary to support ongoing operations, as the company does not expect to generate significant revenue from product sales in the foreseeable future[141]. - The company has raised approximately $378.3 million to date, including from grants and option exercises[209]. Legal and Compliance - The company intends to vigorously defend against ongoing class action lawsuits alleging violations of securities laws, with no accruals recorded as of June 30, 2022[119][123]. - The company has recorded a valuation allowance against its deferred tax assets due to uncertainty around utilizing these tax attributes[175]. Workforce and Operational Changes - The company announced a reduction in force of approximately 30% of its workforce to align with near-term business needs and focus on research and development for its lead candidates FX-322 and FX-345[137]. - The company announced a reduction in force of approximately 30% of its workforce to better align resources with business needs, with estimated costs of $1.2 million related to severance[212].