[Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section identifies forward-looking statements, outlines risk factors, and cautions against undue reliance, with no obligation to update unless legally required - This section identifies statements that could be deemed forward-looking, reflecting management's current beliefs and expectations regarding future events or financial performance[13](index=13&type=chunk) - It outlines various risk factors that could cause actual results to differ materially, including the ability to execute business strategy, secure financing, complete clinical trials, manage intellectual property, and navigate regulatory approvals and market competition[14](index=14&type=chunk)[18](index=18&type=chunk) - The company cautions against undue reliance on these statements, which are based on beliefs and assumptions as of the report date, and assumes no obligation to update them unless required by law[17](index=17&type=chunk) Part I – Financial Information [Item 1. Unaudited Condensed Consolidated Financial Statements](index=6&type=section&id=Item%201.%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section presents the company's unaudited condensed consolidated financial statements, including balance sheets, statements of operations, changes in stockholders' equity, cash flows, and detailed notes on operations, policies, discontinued operations, share capital, stock-based compensation, leases, and commitments [Unaudited Condensed Consolidated Balance Sheets](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Presents the company's financial position, detailing assets, liabilities, and stockholders' equity as of March 31, 2022, and December 31, 2021 Condensed Consolidated Balance Sheets (in thousands) | Metric | March 31, 2022 | December 31, 2021 | | :-------------------------- | :------------- | :---------------- | | Cash and cash equivalents | $50,495 | $42,250 | | Total Current Assets | $60,654 | $63,186 | | Total Assets | $64,319 | $67,046 | | Total Liabilities | $8,588 | $18,410 | | Total Stockholders' Equity | $55,731 | $48,636 | [Unaudited Condensed Consolidated Statements Of Operations](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20Of%20Operations) Details the company's financial performance, including revenues, expenses, operating loss, and net income (loss) for the three months ended March 31, 2022 and 2021 Condensed Consolidated Statements of Operations (Three months ended March 31, in thousands) | Metric | 2022 | 2021 | | :-------------------------------------------------- | :--- | :--- | | Total Revenues | $178 | $230 | | Total operating expenses | $8,869 | $9,987 | | Operating loss | $(8,691) | $(9,757) | | Loss from continuing operations | $(8,694) | $(10,876) | | Income (loss) from discontinued operations, net of income taxes | $13,364 | $(9,674) | | Net income (loss) | $4,670 | $(20,550) | | Loss per share from continuing operations, basic and diluted | $(0.16) | $(0.22) | | Income (loss) per share from discontinued operations, basic and diluted | $0.24 | $(0.20) | | Income (loss) per share basic and diluted | $0.08 | $(0.42) | | Weighted average shares outstanding - basic and diluted | 55,386 | 48,868 | [Unaudited Condensed Consolidated Statements Of Changes In Stockholders' Equity](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20Of%20Changes%20In%20Stockholders%27%20Equity) Outlines changes in common stock, additional paid-in capital, and accumulated deficit, reflecting equity movements for the periods ended March 31, 2022 and 2021 Condensed Consolidated Statements of Changes in Stockholders' Equity (in thousands, except share data) | Metric | Balance at Jan 1, 2021 | Changes during period (Q1 2021) | Balance at Mar 31, 2021 | Balance at Jan 1, 2022 | Changes during period (Q1 2022) | Balance at Mar 31, 2022 | | :--------------------- | :--------------------- | :------------------------------ | :---------------------- | :--------------------- | :------------------------------ | :---------------------- | | Common Stock (Shares) | 43,205,221 | 8,181,375 | 51,386,596 | 53,577,744 | 4,330,745 | 57,908,489 | | Common Stock (Amounts) | $4 | $1 | $5 | $5 | $1 | $6 | | Additional paid-in capital | $603,685 | $75,957 | $679,642 | $688,156 | $2,431 | $690,580 | | Accumulated deficit | $(566,196) | $(20,550) | $(586,746) | $(639,525) | $4,670 | $(634,855) | | Total Stockholders' Equity | $37,493 | $55,308 | $92,901 | $48,636 | $7,095 | $55,731 | - Net income of **$4.67 million** in Q1 2022 significantly improved the accumulated deficit compared to a net loss of **$20.55 million** in Q1 2021[26](index=26&type=chunk) [Unaudited Condensed Consolidated Statements Of Cash Flows](index=9&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20Of%20Cash%20Flows) Provides a breakdown of cash flows from operating, investing, and financing activities, showing the overall change in cash for the three months ended March 31, 2022 and 2021 Condensed Consolidated Statements of Cash Flows (Three months ended March 31, in thousands) | Cash Flow Activity | 2022 | 2021 | | :---------------------------------------------------------------- | :--- | :--- | | Net income (loss) | $4,670 | $(20,550) | | Net cash used in operating activities | $(9,975) | $(12,551) | | Net cash provided by investing activities | $16,688 | $0 | | Net cash provided by financing activities | $1,532 | $73,503 | | Increase in cash, cash equivalents and restricted cash | $8,245 | $60,952 | | Cash, cash equivalents and restricted cash at end of the period | $51,100 | $119,371 | - Investing activities provided **$16.69 million** in Q1 2022, primarily from the sale of the MST Franchise, a significant increase from no investing activity in Q1 2021[29](index=29&type=chunk)[132](index=132&type=chunk) - Financing activities decreased substantially from **$73.50 million** in Q1 2021 to **$1.53 million** in Q1 2022, reflecting lower proceeds from common stock issuances[29](index=29&type=chunk)[133](index=133&type=chunk) [Notes to Unaudited Interim Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Interim%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations of the company's operations, significant accounting policies, discontinued operations, share capital, stock-based compensation, operating leases, and commitments and contingencies - **NOTE 1 - Nature of Operations:** **VYNE** is a biopharmaceutical company focused on immuno-inflammatory conditions, with **FMX114** in Phase 2a and preclinical **BET inhibitor** programs. The company divested its commercial **MST Franchise** in January 2022 to refocus on R&D, leading to workforce reduction and a strategic shift. The company's ability to continue as a going concern is dependent on raising additional capital[33](index=33&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk)[39](index=39&type=chunk)[45](index=45&type=chunk)[46](index=46&type=chunk) - **NOTE 2 - Significant Accounting Policies:** Financial statements are prepared under **U.S. GAAP**. Key policies include the use of estimates (R&D accruals, share-based compensation), no inventory post-MST sale, royalty-based revenue recognition, and classification of the **MST Franchise** as discontinued operations. The company is evaluating **ASU 2020-04** and will adopt **ASU 2016-13**, with no material impact expected[47](index=47&type=chunk)[50](index=50&type=chunk)[52](index=52&type=chunk)[53](index=53&type=chunk)[64](index=64&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk) - **NOTE 3 – Discontinued Operations:** The **MST Franchise** sale on January 12, 2022, resulted in a **$13.01 million** gain. The company received **$20.0 million** cash upfront and expects an additional **$5.0 million** in January 2023, plus up to **$450.0 million** in sales milestone payments. Product sales from discontinued operations were **$0.11 million** in Q1 2022, down from **$3.89 million** in Q1 2021[68](index=68&type=chunk)[69](index=69&type=chunk)[71](index=71&type=chunk)[73](index=73&type=chunk) - **NOTE 4 – Share Capital:** As of March 31, 2022, there were **57,908,489** common shares outstanding. The company issued **2,587,855** common shares for **$1.6 million** net proceeds in Q1 2022 and entered an agreement with **Lincoln Park Capital** to sell up to **$30.0 million** of common stock, issuing **1,667,593** commitment shares[26](index=26&type=chunk)[74](index=74&type=chunk)[79](index=79&type=chunk)[80](index=80&type=chunk) - **NOTE 5 – Share Based Compensation:** Total stock-based compensation expense was **$0.89 million** in Q1 2022, down from **$2.44 million** in Q1 2021. In Q1 2022, **774,503** options and **726,102** RSUs were granted[85](index=85&type=chunk)[86](index=86&type=chunk) - **NOTE 6 – Operating Leases:** Operating leases for corporate offices in New Jersey and Israel expire in September and December 2022, respectively. **$0.6 million** in restricted cash secures lease agreements[87](index=87&type=chunk)[88](index=88&type=chunk)[90](index=90&type=chunk)[91](index=91&type=chunk) - **NOTE 7 – Commitments and Contingencies:** No material adverse legal proceedings or claims are pending as of March 31, 2022[92](index=92&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) This section provides management's perspective on the company's financial condition and results of operations, highlighting the strategic shift to focus on immuno-inflammatory R&D following the divestiture of the MST Franchise, and emphasizing the ongoing need for significant additional financing [Company Overview](index=22&type=section&id=Company%20Overview) Describes VYNE Therapeutics as a biopharmaceutical company focused on immuno-inflammatory conditions, detailing its strategic shift to R&D after divesting the MST Franchise and streamlining operations - **VYNE Therapeutics** is a biopharmaceutical company focused on developing therapies for immuno-inflammatory conditions, with **FMX114** in Phase 2a and preclinical **BET inhibitor** programs[95](index=95&type=chunk) - Following a strategic review, the company divested its commercial **MST Franchise** (**AMZEEQ**, **ZILXI**, **FCD105**) to **Journey Medical Corporation** on January 12, 2022, to refocus resources on its immuno-inflammatory development programs[96](index=96&type=chunk)[97](index=97&type=chunk) - The divestiture included an upfront payment of **$20.0 million**, an additional **$5.0 million** due in one year, and eligibility for up to **$450.0 million** in sales milestone payments[98](index=98&type=chunk) - The company streamlined operations and reduced its workforce from **106** (as of December 31, 2020) to **28** employees at the time of the **MST Franchise** sale[99](index=99&type=chunk) [Key Developments](index=22&type=section&id=Key%20Developments) Highlights significant events including the divestiture of the MST Franchise, positive preclinical and Phase 1b data for pipeline candidates, a Nasdaq non-compliance notification, and an equity purchase agreement - On January 12, 2022, the company divested the **MST Franchise** for **$25.0 million** (**$20.0 million** upfront, **$5.0 million** in one year) and up to **$450.0 million** in milestone payments[100](index=100&type=chunk) - Positive preclinical data for **VYN201** in vitiligo (March 7, 2022) and rheumatoid arthritis (March 30, 2022) were announced[105](index=105&type=chunk) - Positive Phase 1b efficacy data for **FMX114** in mild-to-moderate AD was announced on April 7, 2022, showing a statistically significant reduction in Atopic Dermatitis Severity Index score[105](index=105&type=chunk) - The company received a **Nasdaq** non-compliance notification on February 28, 2022, for failing to maintain a minimum bid price of **$1.00**, with **180 days** to regain compliance[105](index=105&type=chunk) - An **Equity Purchase Agreement** with **Lincoln Park Capital** was entered on March 15, 2022, allowing the sale of up to **$30.0 million** of common stock over **36 months**, with **1,667,593** commitment shares issued[105](index=105&type=chunk) [Financial Overview](index=23&type=section&id=Financial%20Overview) Summarizes the company's financial position, including accumulated deficit, net income drivers, and the critical dependence on additional capital for future viability - The company has incurred net losses since inception, with an accumulated deficit of **$634.9 million** as of March 31, 2022[102](index=102&type=chunk) - Net income for the three months ended March 31, 2022, was **$4.7 million**, driven by a **$13.0 million** gain on the sale of the **MST Franchise**, offsetting an **$8.7 million** loss from continuing operations[102](index=102&type=chunk) - Future viability is dependent on successfully executing its business strategy, developing product candidates, and raising significant additional capital to finance operations[103](index=103&type=chunk) [Components of Operating Results](index=23&type=section&id=Components%20of%20Operating%20Results) Explains the drivers of revenue, research and development expenses, selling, general and administrative expenses, interest expense, and net operating loss carryforwards following the strategic shift - Revenues are now primarily royalty-based (**$0.2 million** for Q1 2022 and Q1 2021), as product sales from **AMZEEQ** and **ZILXI** ceased after the **MST Franchise** sale on January 12, 2022, and are reclassified to discontinued operations[104](index=104&type=chunk)[105](index=105&type=chunk)[106](index=106&type=chunk)[117](index=117&type=chunk) - Research and development expenses are focused on the **BET inhibitor** platform and **FMX114**, with all expenses charged as incurred[108](index=108&type=chunk) - Selling, general and administrative expenses related to the **MST Franchise** have been reclassified to discontinued operations. Remaining SG&A expenses decreased due to lower headcount and professional fees[109](index=109&type=chunk)[119](index=119&type=chunk) - No interest expense was incurred in Q1 2022 due to the payment of all outstanding debt on August 11, 2021[111](index=111&type=chunk)[120](index=120&type=chunk) - As of December 31, 2021, the company had federal and state net operating loss carryforwards of **$315.0 million** and **$105.6 million**, respectively, with **$270.7 million** having no limited period of use[113](index=113&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) Provides a comparative analysis of the company's financial performance for the three months ended March 31, 2022 and 2021, detailing changes in revenues, expenses, and net income (loss) Summary of Operations (Three months ended March 31, in thousands) | Metric | 2022 | 2021 | Variance | % Change | | :----------------------------------- | :--- | :--- | :------- | :------- | | Royalty revenues | $178 | $230 | $(52) | (22.6)% | | Total revenues | $178 | $230 | $(52) | (22.6)% | | Research and development | $4,452 | $4,255 | $197 | 4.6% | | Selling, general and administrative | $4,417 | $5,732 | $(1,315) | (22.9)% | | Total operating expenses | $8,869 | $9,987 | $(1,118) | (11.2)% | | Operating loss | $(8,691) | $(9,757) | $1,066 | (10.9)% | | Interest expense | $0 | $(1,062) | $1,062 | (100.0)% | | Loss from continuing operations | $(8,694) | $(10,876) | $2,182 | (20.1)% | | Income (loss) from discontinued operations | $13,364 | $(9,674) | $23,038 | (238.1)% | | Net income (loss) | $4,670 | $(20,550) | $25,220 | (122.7)% | - Research and development expenses increased by **$0.2 million** (**4.6%**) to **$4.5 million**, primarily due to increased expenditures for **VYN201**, partially offset by decreases in **FMX114** and employee-related expenses[118](index=118&type=chunk) - Selling, general and administrative expenses decreased by **$1.3 million** (**22.9%**) to **$4.4 million**, mainly due to lower headcount and professional fees[119](index=119&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) Assesses the company's cash position, capital needs, and ability to fund operations, highlighting the impact of the MST Franchise sale and the ongoing requirement for significant additional financing - As of March 31, 2022, the company had **$51.1 million** in cash, cash equivalents, and restricted cash, and an accumulated deficit of **$634.9 million**[124](index=124&type=chunk) - The sale of the **MST Franchise** in January 2022 provided **$20.0 million** in proceeds, with an additional **$5.0 million** due in January 2023[124](index=124&type=chunk) - The company used **$10.0 million** in cash from operating activities in Q1 2022, while investing activities provided **$16.7 million** from the **MST Franchise** sale[129](index=129&type=chunk)[130](index=130&type=chunk)[132](index=132&type=chunk) - Substantial doubt exists about the company's ability to continue as a going concern beyond one year without significant additional financing, which is required for its immuno-inflammatory pipeline[126](index=126&type=chunk)[127](index=127&type=chunk)[158](index=158&type=chunk) - The company is subject to 'baby shelf rules' for its **Form S-3**, limiting primary public offerings to one-third of its non-affiliate public float until it exceeds **$75.0 million**[127](index=127&type=chunk)[128](index=128&type=chunk) [Critical Accounting Policies, Significant Judgments and Use of Estimates](index=30&type=section&id=Critical%20Accounting%20Policies%2C%20Significant%20Judgments%20and%20Use%20of%20Estimates) Discusses the critical accounting policies and significant judgments involved in preparing financial statements, particularly concerning revenue recognition and the accounting for discontinued operations - The preparation of financial statements requires significant estimates and assumptions, particularly for revenue recognition and discontinued operations[139](index=139&type=chunk)[141](index=141&type=chunk) - Revenue recognition follows **ASC 606**, involving a five-step model to identify performance obligations and recognize milestone payments when probable of not reversing[142](index=142&type=chunk)[145](index=145&type=chunk) - The sale of the **MST Franchise** was accounted for as discontinued operations under **ASC 205**, reflecting a strategic shift with a major effect on the business[146](index=146&type=chunk)[147](index=147&type=chunk) [Off-Balance Sheet Arrangements](index=31&type=section&id=Off-Balance%20Sheet%20Arrangements) States that the company has no off-balance sheet arrangements expected to materially affect its financial condition or operations - The company has no off-balance sheet arrangements that are expected to have a material current or future effect on its financial condition or operations[148](index=148&type=chunk) [JOBS Act Accounting Election](index=31&type=section&id=JOBS%20Act%20Accounting%20Election) Confirms the company's irrevocable decision to opt out of the extended transition period for new or revised accounting standards under the JOBS Act - The company has irrevocably opted out of the extended transition period for complying with new or revised accounting standards under the **JOBS Act**[149](index=149&type=chunk) [Recently Issued and Adopted Accounting Pronouncements](index=31&type=section&id=Recently%20Issued%20and%20Adopted%20Accounting%20Pronouncements) Details the company's evaluation and expected adoption of new accounting standards, noting no material impact on its consolidated financial statements - The company is evaluating **ASU 2020-04** (Reference Rate Reform) and will adopt **ASU 2016-13** (Credit Losses) effective January 1, 2023, with neither expected to have a material impact on its consolidated financial statements[66](index=66&type=chunk)[67](index=67&type=chunk)[150](index=150&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) As a smaller reporting company, VYNE Therapeutics Inc. is not required to provide quantitative and qualitative disclosures about market risk - The company is a smaller reporting company and is therefore not required to provide market risk disclosures[152](index=152&type=chunk) [Item 4. Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2022, and reported no material changes in internal control over financial reporting during the quarter - Management, including the **CEO** and **CFO**, evaluated the effectiveness of disclosure controls and procedures and concluded they were effective at a reasonable assurance level as of March 31, 2022[153](index=153&type=chunk) - There were no material changes in internal control over financial reporting during the three months ended March 31, 2022[154](index=154&type=chunk) Part II – Other Information [Item 1. Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) As of March 31, 2022, the company has no pending legal proceedings or claims that management believes are likely to have a material adverse effect on its business - No claims or actions are pending against the company that are likely to have a material adverse effect as of March 31, 2022[156](index=156&type=chunk) [Item 1A. Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) The company's risk factors are primarily detailed in its Annual Report on Form 10-K, with no material changes as of March 31, 2022, except for heightened risks related to liquidity, raising substantial doubt about its ability to continue as a going concern - Information about risk factors is contained in **Item 1A** of the Annual Report on **Form 10-K**, with no material changes as of March 31, 2022, except for liquidity risks[157](index=157&type=chunk) - The company needs substantial additional funding to finance operations and may not be able to continue as a going concern if unable to do so, potentially forcing delays, reductions, or termination of R&D activities[158](index=158&type=chunk) - As of March 31, 2022, the company had approximately **$51.1 million** in cash, cash equivalents, and restricted cash, but does not have sufficient funds to cover operations beyond one year, raising substantial doubt about its going concern ability[158](index=158&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=33&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report for the period - None to report[159](index=159&type=chunk) [Item 3. Defaults Upon Senior Securities](index=33&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities to report for the period - None to report[159](index=159&type=chunk) [Item 4. Mine Safety Disclosures](index=33&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[159](index=159&type=chunk) [Item 5. Other Information](index=33&type=section&id=Item%205.%20Other%20Information) There is no other information to report for the period - None to report[160](index=160&type=chunk) [Item 6. Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed or furnished with the Quarterly Report on Form 10-Q, including key agreements such as the Asset Purchase Agreement with Journey Medical Corporation and the Equity Purchase Agreement with Lincoln Park Capital Fund, LLC, along with various certifications and XBRL documents - Key exhibits include the **Asset Purchase Agreement** (**Journey Medical Corporation**), **Amended and Restated Certificate of Incorporation and Bylaws**, and the **Purchase Agreement and Registration Rights Agreement** with **Lincoln Park Capital Fund, LLC**[161](index=161&type=chunk) - Certifications from the **Chief Executive Officer** and **Chief Financial Officer** (**Rule 13a-14(a)/15d-14(a)** and **Section 1350**) are filed[161](index=161&type=chunk) - **XBRL Instance Document** and **Taxonomy Extension Documents** are included[161](index=161&type=chunk) [SIGNATURES](index=36&type=section&id=SIGNATURES) The Quarterly Report on Form 10-Q is signed by David Domzalski, President and Chief Executive Officer, and Tyler Zeronda, Chief Financial Officer and Treasurer, on behalf of VYNE Therapeutics Inc. on May 12, 2022 - The report was signed by **David Domzalski** (President and CEO) and **Tyler Zeronda** (CFO and Treasurer) on May 12, 2022[168](index=168&type=chunk)

[PART I](index=7&type=section&id=PART%20I) This section outlines the company's business, product pipeline, strategic initiatives, risk factors, and foundational corporate details [ITEM 1. Business](index=7&type=section&id=ITEM%201.%20Business) VYNE Therapeutics Inc. is a biopharmaceutical company focused on developing innovative therapies for immuno-inflammatory conditions. The company divested its commercial dermatology business in early 2022 to concentrate resources on its pipeline, which includes FMX114 for atopic dermatitis and BET inhibitor compounds (VYN201 and VYN202) for various immuno-inflammatory diseases. The strategy involves advancing these candidates, leveraging its InhiBET™ platform, and exploring strategic partnerships and acquisitions - VYNE Therapeutics is a biopharmaceutical company focused on developing proprietary, innovative, and differentiated therapies for immuno-inflammatory conditions[29](index=29&type=chunk) - The company divested its commercial dermatology business (AMZEEQ, ZILXI, FCD105) in **January 2022** to refocus on its immuno-inflammatory pipeline[30](index=30&type=chunk)[61](index=61&type=chunk) - Current pipeline includes **FMX114** (Phase 2a for mild-to-moderate atopic dermatitis) and preclinical BET inhibitor candidates **VYN201** and **VYN202**[29](index=29&type=chunk)[32](index=32&type=chunk)[36](index=36&type=chunk)[60](index=60&type=chunk) - The company's strategy involves developing FMX114, establishing the InhiBET™ platform, maximizing pipeline value through partnerships, and expanding the portfolio via in-licensing or acquisitions[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk) [Overview](index=7&type=section&id=Overview) VYNE Therapeutics develops immuno-inflammatory therapies, with FMX114 in Phase 2a and BET inhibitors in preclinical stages - VYNE Therapeutics is a biopharmaceutical company focused on developing proprietary, innovative, and differentiated therapies for immuno-inflammatory conditions[29](index=29&type=chunk) - The most advanced product candidate is **FMX114**, in Phase 2a for mild-to-moderate atopic dermatitis (AD)[29](index=29&type=chunk) - Preclinical development is underway for Bromodomain and Extra-Terminal Domain (BET) inhibitor compounds, with **VYN201** as an initial candidate for locally administered pan-BET inhibition in various immuno-inflammatory diseases[29](index=29&type=chunk) - The company also seeks opportunistic transactions to enhance its pipeline and fund future growth[29](index=29&type=chunk) [Immuno-Inflammatory Disease](index=7&type=section&id=Immuno-Inflammatory%20Disease) This section describes immuno-inflammatory diseases and the therapeutic approaches of FMX114 and InhiBET™ platform's BET inhibitors - Immuno-inflammatory diseases are immune system disorders caused by excessive activation or insufficient inhibition, often debilitating or life-threatening[31](index=31&type=chunk) - The therapeutic goal is to achieve a potent anti-inflammatory response with minimal systemic side effects[31](index=31&type=chunk) - **FMX114** targets mild-to-moderate AD by combining tofacitinib (JAK inhibitor) and fingolimod (S1-P receptor modulator) to reduce inflammation and support skin barrier recovery[32](index=32&type=chunk) - The **InhiBET™ platform**, licensed from In4Derm, aims to develop BET inhibitor compounds for a broad range of immune system disorders by blocking pro-inflammatory cytokine transcription[33](index=33&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) - **VYN201** is a first-in-class 'soft' pan-BD BET inhibitor designed for localized anti-inflammatory effects with rapid metabolic clearance[36](index=36&type=chunk) - The company holds an option to license selective bromodomain 2 BET inhibitors for oral administration (**VYN202**), which could offer convenient non-biologic treatment options[37](index=37&type=chunk) [Our Strategy](index=8&type=section&id=Our%20Strategy) VYNE's strategy focuses on advancing FMX114, establishing the InhiBET™ platform, and expanding its portfolio via partnerships or acquisitions - Develop **FMX114** as a potential first topical combination product for AD, with Phase 2a topline results expected in **Q2 2022**[38](index=38&type=chunk) - Establish the **InhiBET™ BET inhibitor platform** to discover and develop BET inhibitor product candidates for diverse indications and administration modes[39](index=39&type=chunk) - Maximize pipeline value through potential partnering activities, leveraging the broad utility of candidates like **VYN201**[40](index=40&type=chunk) - Expand the product candidate portfolio through in-licensing or acquisitions, focusing on disease rationale, regulatory approval likelihood, commercial viability, and intellectual property[41](index=41&type=chunk) [Our Portfolio of Product Candidates](index=9&type=section&id=Our%20Portfolio%20of%20Product%20Candidates) This section details FMX114, VYN201, and VYN202, outlining their mechanisms, preclinical data, and immuno-inflammatory applications - **FMX114** is a fixed combination of tofacitinib and fingolimod, designed to address inflammation and support skin barrier recovery in mild-to-moderate AD[42](index=42&type=chunk) - Preclinical data for FMX114 showed an **89% reduction** in modified atopic dermatitis index score, comparable to triamcinolone 0.1% cream, with better tolerability (animal body weight gain)[43](index=43&type=chunk)[44](index=44&type=chunk) - Phase 1b data for FMX114 indicated substantially **lower systemic bioavailability** of tofacitinib and undetectable fingolimod plasma concentrations compared to oral equivalents, supporting a favorable safety profile[44](index=44&type=chunk) - **VYN201**, a locally administered pan-BD BET inhibitor, demonstrated dose-dependent anti-inflammatory effects in a Th17 inflammation model, reducing cytokine expression and inflammation severity comparable to a super-potent steroid but with better tolerability[48](index=48&type=chunk)[50](index=50&type=chunk)[51](index=51&type=chunk)[52](index=52&type=chunk)[56](index=56&type=chunk) - VYN201 also showed improvements in reducing fibrotic tissue mass and accelerating skin repair in a fibrotic tissue model, with better aesthetic outcomes and good tolerability[54](index=54&type=chunk)[57](index=57&type=chunk) - In a vitiligo model, VYN201 reduced pro-inflammatory biomarkers (MMP-9, soluble E-cadherin), minimized melanocyte loss, and upregulated the WNT signaling pathway, indicating potential for melanocyte regeneration[55](index=55&type=chunk)[58](index=58&type=chunk)[64](index=64&type=chunk) - **VYN202** is a selective BD2 BET inhibitor program, currently in lead molecule selection, aiming for a more targeted anti-inflammatory effect with an improved benefit/risk profile for oral administration[60](index=60&type=chunk) [Divestiture of Minocycline Business](index=12&type=section&id=Divestiture%20of%20Minocycline%20Business) VYNE divested its MST franchise (AMZEEQ, ZILXI, FCD105) to Journey Medical Corporation for upfront, deferred, and potential milestone payments - On **January 12, 2022**, VYNE divested its Molecule Stabilizing Technology (MST) franchise, including AMZEEQ, ZILXI, and FCD105, to Journey Medical Corporation[61](index=61&type=chunk) - VYNE received an upfront payment of **$20.0 million** and is entitled to an additional **$5.0 million** on the one-year anniversary of the closing[61](index=61&type=chunk) - The company is also eligible for sales milestone payments up to **$450.0 million** and certain payments from Journey's licensing or sublicensing activities outside the U.S[61](index=61&type=chunk) - Journey assumed certain liabilities, including those from a patent infringement suit against Padagis Israel Pharmaceuticals Ltd[61](index=61&type=chunk) [Manufacturing](index=12&type=section&id=Manufacturing) VYNE relies on third-party manufacturers for all raw materials and finished products, ensuring compliance with GLP and cGMP regulations - VYNE relies entirely on third-party manufacturers for raw materials, active ingredients, and finished products for preclinical research and clinical trials[63](index=63&type=chunk) - All contract manufacturing organizations (CMOs) are required to comply with FDA's Good Laboratory Practices (GLP) and current Good Manufacturing Practices (cGMP)[65](index=65&type=chunk) [Development and License Agreements](index=13&type=section&id=Development%20and%20License%20Agreements) VYNE licensed BET inhibitor compounds from In4Derm for VYN201 and VYN202 programs, while continuing to receive royalties from LEO Pharma - VYNE entered an Evaluation and Option Agreement with In4Derm in **April 2021**, granting exclusive option rights to BET inhibitor compounds for human disease treatment[66](index=66&type=chunk) - In **August 2021**, VYNE exercised its option for the **VYN201** program, securing an exclusive worldwide license for pan-BD BET inhibitor compounds[67](index=67&type=chunk) - The VYN201 license includes up to **$15.75 million** in clinical development and regulatory approval milestones, plus tiered royalties of **5-10%** on net sales[68](index=68&type=chunk) - VYNE expects to exercise its option for the **VYN202** selective BET inhibitor program by **June 30, 2022**, involving a **$4.0 million** payment and up to **$43.75 million** in milestones, plus tiered royalties[69](index=69&type=chunk) - VYNE continues to receive royalties from LEO Pharma A/S on net sales of Finacea® Foam, totaling **$0.9 million** in 2021[71](index=71&type=chunk) [Additional Research and Development](index=14&type=section&id=Additional%20Research%20and%20Development) This section details the company's research and development expenses and reliance on third-party contractors for clinical and preclinical testing Research and Development Expenses | Year Ended December 31 | 2021 (Millions USD) | 2020 (Millions USD) | | :----------------------- | :------------------ | :------------------ | | Research and Development | **$25.0** | **$43.5** | - The company contracts with third parties (CROs, medical institutions, clinical investigators, laboratories) for clinical trials and preclinical testing[72](index=72&type=chunk) [Intellectual Property](index=14&type=section&id=Intellectual%20Property) VYNE protects its intellectual property through patents, trademarks, and trade secrets, with FMX114 and VYN201 patents expiring in the 2040s - VYNE protects its intellectual property through patents, trademarks, trade secrets, and contractual agreements[73](index=73&type=chunk) - Patent applications for **FMX114** are expected to expire in **2040 and 2041**, and for **VYN201** in **2040 and 2042**, if granted and maintained[74](index=74&type=chunk) - The company's legacy business includes granted patents worldwide related to pharmaceutical compositions and foam/gel-based technologies[75](index=75&type=chunk) - Patent terms are generally **20 years** from filing, with potential extensions in the U.S. (patent term adjustment/extension) and EU (supplementary patent certificate)[76](index=76&type=chunk)[77](index=77&type=chunk) [Competition](index=15&type=section&id=Competition) VYNE faces intense competition from pharmaceutical and biotechnology companies, which often have greater resources and faster regulatory approvals - VYNE faces intense competition from pharmaceutical and biotechnology companies, academic institutions, and government agencies[78](index=78&type=chunk) - Competitors for **FMX114** in mild-to-moderate AD include topical therapies like Eucrisa (Pfizer), Opzelura (Incyte), and various steroids, as well as pipeline candidates like topical tapinarof and delgocitinib[80](index=80&type=chunk) - The immuno-inflammatory conditions market for **VYN201** is highly competitive, with existing and future treatments[81](index=81&type=chunk) - Competitors often have greater financial resources and expertise, and faster regulatory approvals could establish strong market positions before VYNE's products[79](index=79&type=chunk)[82](index=82&type=chunk) [Government Regulation](index=15&type=section&id=Government%20Regulation) Drug development and commercialization are subject to extensive government regulations in the U.S. and internationally, covering approval, post-approval, pricing, and fraud laws - Drug development and commercialization are subject to extensive government regulation in the U.S. (FDA) and other jurisdictions[83](index=83&type=chunk)[84](index=84&type=chunk) - The U.S. drug approval process involves preclinical studies (GLP), IND submission, clinical trials (GCP, IRB approval) in three phases (I, II, III), NDA submission, FDA review, manufacturing facility inspections (cGMP), and post-approval requirements[85](index=85&type=chunk)[86](index=86&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk)[90](index=90&type=chunk)[91](index=91&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk) - Special FDA programs (Fast Track, Breakthrough Therapy, Accelerated Approval, Priority Review) can expedite development for serious conditions with unmet medical needs, but do not alter approval standards[95](index=95&type=chunk)[96](index=96&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk) - The Hatch-Waxman Act provides pathways for drug approval (505(b)(1) NDA, 505(j) ANDA, 505(b)(2) NDA) and includes provisions for patent listing (Orange Book) and market exclusivity (5-year NCE, 3-year for new clinical studies, pediatric exclusivity)[101](index=101&type=chunk)[102](index=102&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk)[106](index=106&type=chunk)[107](index=107&type=chunk)[108](index=108&type=chunk)[109](index=109&type=chunk)[110](index=110&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk)[121](index=121&type=chunk) - Post-approval requirements include record-keeping, adverse event reporting, updated safety/efficacy information, compliance with promotion/advertising rules (e.g., no off-label promotion), Physician Payments Sunshine Act disclosures, and cGMP for manufacturing[111](index=111&type=chunk)[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk)[115](index=115&type=chunk)[116](index=116&type=chunk) - Foreign regulations, such as in the European Economic Area (EEA), also require Marketing Authorization (MA) and compliance with Pediatric Investigation Plans (PIPs), offering data and market exclusivity periods[122](index=122&type=chunk)[123](index=123&type=chunk)[124](index=124&type=chunk) - Pharmaceutical coverage, pricing, and reimbursement are subject to significant uncertainty and increasing pressure from third-party payors and government reforms (e.g., ACA, Medicaid drug rebate program), which can impact market access and profitability[126](index=126&type=chunk)[127](index=127&type=chunk)[128](index=128&type=chunk)[129](index=129&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk)[132](index=132&type=chunk) - The company is subject to U.S. federal, state, local, and foreign healthcare fraud and abuse laws (e.g., Anti-Kickback Statute, False Claims Act, HIPAA, Physician Payments Sunshine Act), with violations potentially leading to substantial penalties, reputational harm, and operational restrictions[133](index=133&type=chunk)[134](index=134&type=chunk)[135](index=135&type=chunk) [Environmental, Health and Safety Matters](index=25&type=section&id=Environmental%2C%20Health%20and%20Safety%20Matters) VYNE is subject to extensive environmental, health, and safety regulations, primarily in Israel, with non-compliance risking fines and remediation costs - VYNE is subject to extensive environmental, health, and safety laws and regulations, primarily in Israel, governing chemical use, waste disposal, and contamination[136](index=136&type=chunk) - Non-compliance can lead to fines, sanctions, permit revocations, and liability for remediation costs, potentially impacting business and financial condition[137](index=137&type=chunk) - Changes in these laws or non-compliance by subcontractors could also adversely affect operations[138](index=138&type=chunk)[139](index=139&type=chunk) [Human Capital](index=26&type=section&id=Human%20Capital) As of December 31, 2021, VYNE had 28 full-time employees, focusing on retention, growth, and development through competitive compensation and an inclusive culture - As of **December 31, 2021**, VYNE had **28 full-time employees** (14 female, 14 male), with **14** primarily engaged in R&D[140](index=140&type=chunk) - The company emphasizes employee retention, growth, and development through competitive compensation and benefits, fostering a culture of communication, transparency, diversity, and inclusion[140](index=140&type=chunk)[141](index=141&type=chunk) [Financial and Segment Information](index=26&type=section&id=Financial%20and%20Segment%20Information) VYNE operates as a single business segment, with all financial information integrated into the consolidated financial statements - VYNE operates its business as a single segment, with financial information included in the consolidated financial statements[142](index=142&type=chunk) [Corporate Information](index=26&type=section&id=Corporate%20Information) VYNE Therapeutics Inc. was incorporated in October 2011, changed its name in 2020, and is an 'emerging growth' and 'smaller reporting' company - VYNE Therapeutics Inc. was incorporated in **October 2011** as Tigercat Pharma, Inc., changing its name in **September 2020** following the merger of Foamix Pharmaceuticals Ltd. and Menlo Therapeutics Inc[143](index=143&type=chunk) - The company is an 'emerging growth company' and 'smaller reporting company,' eligible for reduced disclosure requirements[144](index=144&type=chunk) [ITEM 1A. Risk Factors](index=26&type=section&id=ITEM%201A.%20Risk%20Factors) This section outlines significant risks and uncertainties facing VYNE Therapeutics, categorized into development, business/financial operations, government regulation, intellectual property, and securities markets. Key risks include dependence on successful product candidate development, substantial funding needs, clinical trial delays, regulatory hurdles, intense competition, and potential intellectual property infringement. The company's status as an 'emerging growth company' and stock price volatility also present risks - The business success is highly dependent on the successful development of **FMX114** and BET inhibitor product candidates, with significant risks of failure in early-stage programs[18](index=18&type=chunk)[148](index=148&type=chunk)[149](index=149&type=chunk) - Substantial additional funding is required for operations, raising substantial doubt about the company's ability to continue as a going concern, potentially forcing delays or termination of R&D activities[18](index=18&type=chunk)[185](index=185&type=chunk) - Clinical trials are expensive, time-consuming, and uncertain, with potential for delays, failures to demonstrate safety/efficacy, or identification of serious adverse effects, which could prevent regulatory approval[18](index=18&type=chunk)[150](index=150&type=chunk)[151](index=151&type=chunk)[152](index=152&type=chunk)[155](index=155&type=chunk)[156](index=156&type=chunk) - The company faces intense competition from larger, more resourced pharmaceutical and biotechnology companies, which could reduce commercial opportunities for its drug candidates[78](index=78&type=chunk)[79](index=79&type=chunk)[82](index=82&type=chunk) - Extensive government regulation, including healthcare fraud and abuse laws, pricing/reimbursement reforms, and manufacturing compliance, poses risks of substantial penalties, increased costs, and delays in product approval[83](index=83&type=chunk)[135](index=135&type=chunk)[222](index=222&type=chunk)[231](index=231&type=chunk)[243](index=243&type=chunk) - Inadequate intellectual property protection, potential infringement of third-party rights, and costly litigation could harm the company's competitive position and business[73](index=73&type=chunk)[148](index=148&type=chunk)[256](index=256&type=chunk)[257](index=257&type=chunk)[273](index=273&type=chunk)[274](index=274&type=chunk)[276](index=276&type=chunk) - The trading price of common stock is volatile, and failure to maintain Nasdaq listing requirements could lead to delisting, negatively impacting market liquidity and capital raising ability[300](index=300&type=chunk)[302](index=302&type=chunk)[303](index=303&type=chunk) [ITEM 1B. Unresolved Staff Comments](index=58&type=section&id=ITEM%201B.%20Unresolved%20Staff%20Comments) There are no unresolved staff comments from the SEC regarding the company's previous filings - No unresolved staff comments were reported[332](index=332&type=chunk) [ITEM 2. Properties](index=58&type=section&id=ITEM%202.%20Properties) VYNE Therapeutics maintains executive offices in Bridgewater, New Jersey, and office/laboratory facilities in Ness Ziona, Israel. The company believes its current facilities are adequate for present needs and that suitable additional spaces will be available for future growth - The company's executive offices are in Bridgewater, New Jersey (**15,000 sq ft** lease expiring **August 31, 2022**, with a 3-year extension option)[333](index=333&type=chunk) - Office and warehouse space in Israel (**4,600 sq ft** office, **3,500 sq ft** warehouse) is leased until **December 31, 2022**[333](index=333&type=chunk) - Current facilities are deemed adequate, and additional spaces are expected to be available on commercially reasonable terms for future growth[334](index=334&type=chunk) [ITEM 3. Legal Proceedings](index=58&type=section&id=ITEM%203.%20Legal%20Proceedings) VYNE Therapeutics is not currently involved in any legal proceedings that management believes would have a material adverse effect on its business. The company may periodically face litigation in the ordinary course of business - No current claims or actions pending against the company are likely to have a material adverse effect on its business[335](index=335&type=chunk) - The company may become involved in litigation or other legal proceedings in the ordinary course of business[335](index=335&type=chunk) [ITEM 4. Mine Safety Disclosures](index=58&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable to VYNE Therapeutics Inc. as it is not involved in mining operations - This item is not applicable[336](index=336&type=chunk) [PART II](index=58&type=section&id=PART%20II) This section details the company's market for common equity, financial condition, operational results, and supplementary data [ITEM 5. Market For Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities](index=58&type=section&id=ITEM%205.%20Market%20For%20Registrant%27s%20Common%20Equity%2C%20Related%20Shareholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) VYNE Therapeutics' common stock is listed on Nasdaq under the symbol 'VYNE'. A one-for-four reverse stock split was effected in February 2021. As of March 2, 2022, there were approximately 8 holders of record of the common stock - VYNE's common stock is listed on Nasdaq under the symbol '**VYNE**'[338](index=338&type=chunk) - A **one-for-four reverse stock split** was effected on **February 12, 2021**, converting every four outstanding shares into one, with no fractional shares issued[338](index=338&type=chunk) - As of **March 2, 2022**, there were approximately **8 holders of record** of the common stock[339](index=339&type=chunk) [ITEM 6. [Reserved]](index=59&type=section&id=ITEM%206.%20%5BReserved%5D) This item is reserved and contains no information - This item is reserved[340](index=340&type=chunk) [ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=60&type=section&id=ITEM%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides an overview of VYNE Therapeutics' financial condition and operational results, highlighting the strategic shift from a commercial dermatology business to a research and development focus on immuno-inflammatory conditions. It details the divestiture of the MST franchise, key financial developments, and the company's liquidity challenges, including substantial doubt about its ability to continue as a going concern without additional financing. The discussion also covers revenue, expenses, and critical accounting policies - VYNE Therapeutics transitioned from a commercial organization to an R&D-focused biopharmaceutical company, concentrating on immuno-inflammatory conditions[343](index=343&type=chunk)[347](index=347&type=chunk) - The Molecule Stabilizing Technology (MST) franchise, including AMZEEQ and ZILXI, was divested to Journey Medical Corporation in **January 2022** for **$25.0 million** upfront/deferred payments and up to **$450.0 million** in sales milestones[345](index=345&type=chunk)[346](index=346&type=chunk) - The company streamlined operations, reducing its workforce from **106 to 28 employees** in 2021, incurring a **$1.6 million** restructuring charge[347](index=347&type=chunk)[348](index=348&type=chunk) Summary of Operations (Years Ended December 31) | Metric (in millions) | 2021 | 2020 | Variance (Millions) | Variance (%) | | :------------------- | :----- | :----- | :------------------ | :----------- | | Revenues | **$14.8** | **$21.0** | **$(6.2)** | **(29.7)%** | | Cost of goods sold | **$3.3** | **$1.4** | **$2.0** | **140.5%** | | R&D expenses | **$25.0** | **$43.5** | **$(18.6)** | **(42.7)%** | | SG&A expenses | **$54.5** | **$89.5** | **$(35.1)** | **(39.2)%** | | Operating Loss | **$68.0** | **$252.5** | **$(184.5)** | **(73.1)%** | | Net Loss | **$73.3** | **$255.5** | **$(182.2)** | **(71.3)%** | - The company incurred a net loss of **$73.3 million** in 2021 and used **$56.4 million** in operating cash flows, with cash and cash equivalents of **$42.9 million** as of December 31, 2021[380](index=380&type=chunk) - Substantial doubt exists about the company's ability to continue as a going concern without significant additional financing, which may be limited by 'baby shelf rules' for companies with public floats under **$75 million**[381](index=381&type=chunk)[382](index=382&type=chunk)[188](index=188&type=chunk) [Company Overview](index=60&type=section&id=Company%20Overview) VYNE Therapeutics focuses on immuno-inflammatory conditions, with FMX114 and VYN201 in development, having divested its commercial dermatology franchise - VYNE Therapeutics is a biopharmaceutical company focused on developing proprietary therapies for immuno-inflammatory conditions[343](index=343&type=chunk) - The company's most advanced product candidate is **FMX114** (Phase 2a for mild-to-moderate AD), and it is in preclinical stages for BET inhibitor compounds (**VYN201**)[343](index=343&type=chunk) - A strategic review in **H1 2021** led to the decision to divest the topical minocycline franchise (AMZEEQ, ZILXI, FCD105) and the underlying Molecule Stabilizing Technology platform[344](index=344&type=chunk) - The MST franchise was sold to Journey Medical Corporation on **January 12, 2022**, for an upfront payment of **$20.0 million**, a **$5.0 million** deferred payment, and up to **$450.0 million** in sales milestone payments[345](index=345&type=chunk)[346](index=346&type=chunk) - The company reduced its workforce from **106 to 28 employees** in 2021, incurring a **$1.6 million** restructuring charge[347](index=347&type=chunk)[348](index=348&type=chunk) [Key Developments](index=61&type=section&id=Key%20Developments) Key developments include equity offerings, a reverse stock split, FMX114 and BET inhibitor program progress, debt prepayment, and a new equity purchase agreement - In **January 2021**, VYNE sold **2.78 million shares** for **$26.3 million** net proceeds via an at-the-market offering and completed a registered direct offering of **5.27 million shares** for **$46.8 million** net proceeds[349](index=349&type=chunk) - A **one-for-four reverse stock split** was effected on **February 12, 2021**, reducing authorized shares from **300 million to 75 million**[349](index=349&type=chunk) - Development plans for **FMX114** for mild-to-moderate AD were announced in **March 2021**, with Phase 1b/2a trial enrollment starting in **October 2021** and positive Phase 1b safety data announced in **January 2022**[349](index=349&type=chunk) - The company prepaid its outstanding indebtedness of approximately **$36.5 million** in **August 2021**, terminating the credit agreement[349](index=349&type=chunk) - A licensing arrangement with In4Derm for novel BET inhibitor compounds was announced in **August 2021**, followed by positive preclinical data for **VYN201** in Th17-mediated autoimmune diseases (**October 2021**) and vitiligo (**March 2022**)[349](index=349&type=chunk) - In **March 2022**, VYNE entered an Equity Purchase Agreement with Lincoln Park Capital Fund, LLC to sell up to **$30.0 million** of common stock over **36 months**[353](index=353&type=chunk) [Revenues](index=62&type=section&id=Revenues) Total revenues decreased in 2021 due to the absence of a 2020 license payment, despite increased product sales which will cease post-divestiture Revenue Breakdown (Years Ended December 31) | Revenue Type (in millions) | 2021 | 2020 | | :------------------------- | :---- | :----- | | Product sales, net | **$13.8** | **$10.2** | | License revenues | **$0.0** | **$10.0** | | Royalty revenues | **$0.9** | **$0.8** | | **Total Revenues** | **$14.8** | **$21.0** | - Product sales increased in 2021 due to AMZEEQ and ZILXI, but will cease after **January 12, 2022**, due to the MST franchise divestiture[352](index=352&type=chunk)[370](index=370&type=chunk) - License revenue decreased significantly in 2021 due to a **$10.0 million** upfront payment received in 2020 from the Cutia License Agreement, which was assigned to Journey in 2022[354](index=354&type=chunk)[371](index=371&type=chunk) - Royalty revenue from Finacea increased slightly to **$0.9 million** in 2021 and was not transferred in the MST franchise sale[353](index=353&type=chunk)[369](index=369&type=chunk) [Cost of Goods Sold](index=63&type=section&id=Cost%20of%20Goods%20Sold) Cost of goods sold increased in 2021 due to higher sales volume, decreasing gross margin, though prior expensed materials favorably impacted reported margins Cost of Goods Sold and Gross Margin (Years Ended December 31) | Metric (in millions) | 2021 | 2020 | | :------------------- | :---- | :---- | | Cost of Goods Sold | **$3.3** | **$1.4** | | Gross Margin % | **75.8%** | **86.4%** | - The increase in cost of goods sold in 2021 was primarily due to increased sales volume[372](index=372&type=chunk) - Gross margin was favorably impacted by product sales using materials expensed in prior periods (pre-FDA approval); if valued at cost, gross margin would have been **74.6%** in 2021 and **82.5%** in 2020[355](index=355&type=chunk)[372](index=372&type=chunk) [Operating Expenses](index=63&type=section&id=Operating%20Expenses) Operating expenses significantly decreased in 2021, primarily due to the absence of 2020 impairments and remeasurement expenses, alongside R&D and SG&A cost reductions Operating Expenses (Years Ended December 31) | Expense Type (in millions) | 2021 | 2020 | Variance (Millions) | Variance (%) | | :------------------------- | :----- | :----- | :------------------ | :----------- | | Research and development | **$25.0** | **$43.5** | **$(18.6)** | **(42.7)%** | | Selling, general & admin. | **$54.5** | **$89.5** | **$(35.1)** | **(39.2)%** | | Goodwill & IPR&D impairments | **$0.0** | **$54.3** | **$(54.3)** | **(100.0)%** | | Contingent Stock Remeasurement | **$0.0** | **$84.7** | **$(84.7)** | **(100.0)%** | - R&D expenses decreased by **$18.6 million** in 2021, driven by lower employee-related expenses (**$11.2 million**) and reduced clinical/manufacturing costs (**$11.8 million**) from completed trials, partially offset by increased FMX114 and BET inhibitor costs (**$6.5 million**)[373](index=373&type=chunk) - SG&A expenses decreased by **$35.1 million** in 2021, primarily due to a **$21.0 million** reduction in employee-related expenses (including **$8.2 million** less stock-based compensation from CSR conversion) and **$14.1 million** lower corporate/professional costs following the shift to an R&D focus[374](index=374&type=chunk) - Goodwill and in-process R&D impairments of **$54.3 million** were recorded in 2020 due to failed serlopitant clinical trials; no impairments in 2021[375](index=375&type=chunk) - A **$84.7 million** Contingent Stock Right (CSR) remeasurement expense was recorded in 2020 due to serlopitant trial results; no such expense in 2021[376](index=376&type=chunk) [Interest Expense](index=64&type=section&id=Interest%20Expense) Interest expense increased in 2021 due to debt prepayment penalties and write-offs, but no material interest expense is expected after debt repayment Interest Expense (Years Ended December 31) | Metric (in millions) | 2021 | 2020 | | :------------------- | :---- | :---- | | Interest Expense | **$5.6** | **$4.4** | - The increase in interest expense in 2021 was primarily due to a **$1.4 million** prepayment penalty and a **$1.6 million** write-off of deferred financing costs associated with the **August 2021** debt prepayment[361](index=361&type=chunk)[377](index=377&type=chunk) - No material interest expense is expected going forward due to the prepayment of outstanding indebtedness[361](index=361&type=chunk) [Other Income, net](index=64&type=section&id=Other%20Income%2C%20net) Other expense (income), net shifted from income in 2020 to a slight expense in 2021, due to the absence of gains on derivative liabilities and marketable securities Other Expense (Income), Net (Years Ended December 31) | Metric (in millions) | 2021 | 2020 | | :------------------- | :---- | :----- | | Other Expense (Income), net | **$0.1** | **$(1.1)** | - Other expense (income), net shifted from income in 2020 to a slight expense in 2021, primarily due to the absence of gains on derivative liabilities and marketable securities in 2021[362](index=362&type=chunk)[378](index=378&type=chunk) [Income Taxes and Net Operating Loss Carryforwards](index=64&type=section&id=Income%20Taxes%20and%20Net%20Operating%20Loss%20Carryforwards) VYNE has significant NOL and tax credit carryforwards, subject to annual limitations, and fully offset a large 2020 taxable gain with NOLs - VYNE has incurred significant net operating losses (NOLs) since inception and expects to continue doing so until product candidates achieve commercial success[363](index=363&type=chunk) NOL and Tax Credit Carryforwards (as of December 31, 2021) | Type | Amount (Millions USD) | | :-------------------- | :-------------------- | | Federal NOLs | **$315.0** | | State NOLs | **$105.6** | | Federal R&D Tax Credits | **$6.7** | | State R&D Tax Credits | **$1.2** | - NOLs and tax credit carryforwards are subject to annual limitations due to potential 'ownership changes' under Sections 382 and 383 of the Internal Revenue Code, which could limit future utilization[365](index=365&type=chunk) - In 2020, the liquidation of the Israeli subsidiary resulted in a **$163.0 million** taxable gain, fully offset by NOL carryforwards, incurring no income tax expense[364](index=364&type=chunk) [Results of Operations for the Years Ended December 31, 2021 and December 31, 2020](index=65&type=section&id=Results%20of%20Operations%20for%20the%20Years%20Ended%20December%2031%2C%202021%20and%20December%2031%2C%202020) The company saw a significant reduction in net and operating loss in 2021 versus 2020, primarily due to the absence of prior year impairment and remeasurement charges Summary of Operations (Years Ended December 31) | Metric (in millions) | 2021 | 2020 | Variance (Millions) | Variance (%) | | :------------------- | :----- | :----- | :------------------ | :----------- | | Revenues | **$14.8** | **$21.0** | **$(6.2)** | **(29.7)%** | | Cost of goods sold | **$3.3** | **$1.4** | **$2.0** | **140.5%** | | R&D expenses | **$25.0** | **$43.5** | **$(18.6)** | **(42.7)%** | | SG&A expenses | **$54.5** | **$89.5** | **$(35.1)** | **(39.2)%** | | Goodwill & IPR&D impairments | **$0.0** | **$54.3** | **$(54.3)** | **(100.0)%** | | Contingent Stock Remeasurement | **$0.0** | **$84.7** | **$(84.7)** | **(100.0)%** | | Operating Loss | **$68.0** | **$252.5** | **$(184.5)** | **(73.1)%** | | Interest expense | **$5.6** | **$4.4** | **$1.2** | **27.8%** | | Other expense (income), net | **$0.1** | **$(1.1)** | **$1.2** | **(112.2)%** | | Loss before income tax | **$73.8** | **$255.8** | **$(182.0)** | **(71.1)%** | | Taxes on income | **$(0.4)** | **$(0.3)** | **$(0.2)** | **73.6%** | | Net Loss | **$73.3** | **$255.5** | **$(182.2)** | **(71.3)%** | - Total revenues decreased by **$6.2 million (29.7%)** in 2021, primarily due to the absence of a **$10.0 million** license revenue payment received in 2020, partially offset by increased product sales[369](index=369&type=chunk)[371](index=371&type=chunk) - Cost of goods sold increased by **$2.0 million (140.5%)** in 2021 due to higher sales volume, while gross margin percentage decreased from **86.4% to 75.8%**[372](index=372&type=chunk) - Operating expenses significantly decreased by **$192.7 million (70.8%)** in 2021, mainly due to the absence of goodwill/IPR&D impairments and CSR remeasurement expenses from 2020, and reductions in R&D and SG&A costs[368](index=368&type=chunk)[373](index=373&type=chunk)[374](index=374&type=chunk)[375](index=375&type=chunk)[376](index=376&type=chunk) - Net loss decreased by **$182.2 million (71.3%)** in 2021, primarily driven by the reduction in operating expenses[368](index=368&type=chunk) [Liquidity](index=66&type=section&id=Liquidity) VYNE has incurred losses and negative operating cash flows, and despite asset sales, substantial doubt exists about its going concern ability without additional financing - VYNE has funded operations through equity/debt placements and licensee payments, incurring losses and negative operating cash flows since inception[379](index=379&type=chunk) Cash and Cash Equivalents (as of December 31) | Metric (in millions) | 2021 | 2020 | | :------------------- | :---- | :---- | | Cash and cash equivalents | **$42.9** | **$57.6** | - The company used **$56.4 million** in cash from operations in 2021 and will no longer generate revenue from AMZEEQ/ZILXI sales after **January 2022**[380](index=380&type=chunk) - Receipt of **$20.0 million** from the MST franchise sale in **January 2022** and an additional **$5.0 million** payment in **January 2023** will provide some liquidity[380](index=380&type=chunk) - Substantial doubt exists about the company's ability to continue as a going concern beyond one year without significant additional financing, which is crucial for its R&D programs[381](index=381&type=chunk)[382](index=382&type=chunk) [Capital Resources](index=67&type=section&id=Capital%20Resources) VYNE's funding sources include equity, debt, and licensee payments; net cash used in operating activities decreased in 2021, while financing activities involved stock issuance and debt repayment - Primary funding sources include equity, debt, warrants, and licensee payments[383](index=383&type=chunk) Net Cash Flows (Years Ended December 31) | Activity (in thousands) | 2021 | 2020 | | :---------------------- | :-------- | :--------- | | Operating activities | **$(56,367)** | **$(137,082)** | | Investing activities | **$1,027** | **$89,107** | | Financing activities | **$39,777** | **$61,808** | - Net cash used in operating activities decreased in 2021 due to lower net loss and non-cash charges[385](index=385&type=chunk)[386](index=386&type=chunk) - Net cash provided by investing activities in 2021 was **$1.0 million** from marketable securities sales, significantly lower than **$89.1 million** in 2020 (which included **$38.6 million** cash from merger)[387](index=387&type=chunk) - Net cash provided by financing activities in 2021 was **$39.8 million**, primarily from **$76.0 million** in common stock issuance offset by **$36.4 million** debt repayment[388](index=388&type=chunk) - Funding sources in 2021 totaled **$76.0 million**, including **$29.2 million** from at-the-market offerings and **$46.8 million** from a registered direct public offering[389](index=389&type=chunk)[390](index=390&type=chunk)[391](index=391&type=chunk) - Significant non-cancelable contractual obligations as of **December 31, 2021**, included lease commitments and **$3.9 million** in open purchase commitments[394](index=394&type=chunk) [Off-Balance Sheet Arrangements](index=69&type=section&id=Off-Balance%20Sheet%20Arrangements) As of December 31, 2021, VYNE Therapeutics had no off-balance sheet arrangements - As of **December 31, 2021**, VYNE Therapeutics had no off-balance sheet arrangements[398](index=398&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=69&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) Financial statement preparation requires significant estimates for business combinations, asset impairments, and revenue recognition, with ongoing COVID-19 impact assessment - Preparation of financial statements requires significant estimates and assumptions, particularly for business combinations, goodwill/intangible asset impairments, and revenue recognition[399](index=399&type=chunk)[400](index=400&type=chunk) - The COVID-19 pandemic has negatively impacted operations and requires ongoing assessment of accounting matters like doubtful accounts, inventory reserves, impairments, and revenue recognition[401](index=401&type=chunk) - Revenue recognition follows a five-step model (ASC 606), identifying performance obligations, determining transaction price, allocating to obligations, and recognizing revenue upon satisfaction[402](index=402&type=chunk)[403](index=403&type=chunk)[404](index=404&type=chunk)[405](index=405&type=chunk) - Business acquisitions are accounted for using the acquisition method, recognizing acquired assets and liabilities at fair value, with IPR&D and goodwill recorded on the balance sheet[406](index=406&type=chunk)[407](index=407&type=chunk)[408](index=408&type=chunk)[409](index=409&type=chunk) - Long-lived assets are reviewed for impairment indicators, and indefinite-lived intangible assets are tested annually; impairment losses are recognized when fair value is less than carrying value[411](index=411&type=chunk) [Recently Issued Accounting Pronouncements](index=71&type=section&id=Recently%20Issued%20Accounting%20Pronouncements) The company is evaluating ASU 2020-4 and will adopt ASU 2016-13 in 2023, with no material impact expected, while ASU 2019-12 had no material impact in 2021 - The company is evaluating **ASU 2020-4** (Reference Rate Reform) but does not expect a material impact[504](index=504&type=chunk) - As a smaller reporting company, VYNE will adopt **ASU 2016-13** (Credit Losses) effective **January 1, 2023**, and does not anticipate a material impact[505](index=505&type=chunk)[506](index=506&type=chunk) - **ASU 2019-12** (Simplifying Income Taxes) became effective in **Q1 2021** and did not have a material impact[507](index=507&type=chunk) [ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk](index=71&type=section&id=ITEM%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a 'smaller reporting company,' VYNE Therapeutics is not required to provide quantitative or qualitative disclosures about market risk - As a 'smaller reporting company,' VYNE Therapeutics is exempt from providing quantitative or qualitative disclosures about market risk[413](index=413&type=chunk) [ITEM 8. Financial Statements and Supplementary Data](index=71&type=section&id=ITEM%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements of VYNE Therapeutics Inc. for the years ended December 31, 2021, and 2020, along with the independent registered public accounting firm's report. It includes the balance sheets, statements of operations, comprehensive loss, changes in shareholders' equity, cash flows, and detailed notes to the financial statements - The section includes the audited consolidated financial statements for the years ended **December 31, 2021 and 2020**[414](index=414&type=chunk)[416](index=416&type=chunk)[420](index=420&type=chunk) - PricewaterhouseCoopers LLP provided an unqualified opinion on the financial statements but highlighted substantial doubt about the company's ability to continue as a going concern[420](index=420&type=chunk)[421](index=421&type=chunk) - Key financial statements presented are Consolidated Balance Sheets, Consolidated Statements of Operations, Consolidated Statements of Comprehensive Loss, Consolidated Statements of Changes in Shareholders' Equity, and Consolidated Statements of Cash Flows[417](index=417&type=chunk) [Financial Statements](index=71&type=section&id=Financial%20Statements) This sub-section refers to the primary audited consolidated financial statements included within the report - This sub-section refers to the main financial statements included in the report[414](index=414&type=chunk) [Report of Independent Registered Public Accounting Firm](index=73&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) PricewaterhouseCoopers LLP issued an unqualified opinion on 2021 and 2020 consolidated financial statements, noting substantial doubt about the company's going concern ability - PricewaterhouseCoopers LLP audited the consolidated financial statements for **2021 and 2020**[420](index=420&type=chunk)[425](index=425&type=chunk) - The auditor issued an **unqualified opinion**, stating the financial statements present fairly in all material respects[420](index=420&type=chunk) - The report highlights substantial doubt about the company's ability to continue as a going concern due to incurred losses and negative operating cash flows since inception[421](index=421&type=chunk) [Consolidated Balance Sheets](index=74&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets show decreased cash and total assets, reduced total liabilities from debt elimination, and increased shareholders' equity from 2020 to 2021 Consolidated Balance Sheet Highlights (as of December 31, in thousands USD) | Metric | 2021 | 2020 | | :--------------------- | :------ | :------ | | Cash and cash equivalents | **$42,250** | **$57,563** | | Total Current Assets | **$63,186** | **$87,259** | | Total Assets | **$67,046** | **$93,742** | | Total Current Liabilities | **$18,410** | **$21,765** | | Total Long-term Liabilities | **$0** | **$34,484** | | Total Liabilities | **$18,410** | **$56,249** | | Total Shareholders' Equity | **$48,636** | **$37,493** | - Cash and cash equivalents decreased by **$15.3 million** from 2020 to 2021[428](index=428&type=chunk) - Total assets decreased by **$26.7 million**, while total liabilities decreased significantly by **$37.8 million**, primarily due to the elimination of long-term debt[428](index=428&type=chunk) - Shareholders' equity increased by **$11.1 million**, reflecting changes in capital and accumulated deficit[428](index=428&type=chunk) [Consolidated Statements of Operations](index=75&type=section&id=Consolidated%20Statements%20of%20Operations) The consolidated statements of operations show a significant net loss reduction from $255.6 million in 2020 to $73.3 million in 2021, due to the absence of prior year impairment and remeasurement charges Consolidated Statements of Operations Highlights (Years Ended December 31, in thousands USD) | Metric | 2021 | 2020 | | :--------------------- | :-------- | :--------- | | Total Revenues | **$14,755** | **$20,993** | | Cost of goods sold | **$3,348** | **$1,392** | | Research and development | **$24,958** | **$43,533** | | Selling, general and administrative | **$54,481** | **$89,543** | | Goodwill and IPR&D impairments | **$0** | **$54,345** | | Contingent Stock Remeasurement | **$0** | **$84,726** | | Operating Loss | **$68,032** | **$252,546** | | Net Loss | **$73,329** | **$255,568** | | Loss per share basic and diluted | **$1.42** | **$7.88** | - Net loss significantly decreased from **$255.6 million** in 2020 to **$73.3 million** in 2021, primarily due to the absence of large impairment and remeasurement charges from the prior year[430](index=430&type=chunk) - Loss per share improved from **$7.88** in 2020 to **$1.42** in 2021[430](index=430&type=chunk) [Consolidated Statements of Comprehensive Loss](index=76&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Loss) Total comprehensive loss significantly reduced to $73.3 million in 2021 from $255.6 million in 2020, with other comprehensive loss being immaterial Consolidated Statements of Comprehensive Loss (Years Ended December 31, in thousands USD) | Metric | 2021 | 2020 | | :--------------------- | :-------- | :--------- | | Net Loss | **$73,329** | **$255,568** | | Total Other Comprehensive Loss | **$0** | **$5** | | Total Comprehensive Loss | **$73,329** | **$255,573** | - Total comprehensive loss for 2021 was **$73.3 million**, a significant reduction from **$255.6 million** in 2020[433](index=433&type=chunk) - Other comprehensive loss was immaterial in both years, with a small gain in 2020 from marketable securities[433](index=433&type=chunk) [Consolidated Statements of Changes in Shareholders' Equity](index=77&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) Total shareholders' equity increased by $11.1 million in 2021, driven by common stock issuance and stock-based compensation, partially offset by net loss Shareholders' Equity Changes (Years Ended December 31, in thousands USD, except share data) | Metric | 2021 | 2020 | | :--------------------- | :---------- | :---------- | | Common stock (shares) | **53,577,744** | **43,205,221** | | Common stock (amounts) | **$5** | **$4** | | Additional paid-in capital | **$688,156** | **$603,685** | | Accumulated deficit | **$(639,525)** | **$(566,196)** | | Total Shareholders' Equity | **$48,636** | **$37,493** | - Total shareholders' equity increased by **$11.1 million** in 2021, driven by **$76.0 million** from common stock issuance and **$8.1 million** in stock-based compensation, partially offset by a net loss of **$73.3 million**[436](index=436&type=chunk) - The number of common shares outstanding increased by over **10 million** in 2021[436](index=436&type=chunk) [Consolidated Statements of Cash Flows](index=78&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities decreased in 2021, investing activities significantly reduced, and financing activities involved stock issuance and debt repayment, leading to an overall cash decrease Consolidated Statements of Cash Flows (Years Ended December 31, in thousands USD) | Activity | 2021 | 2020 | | :--------------------- | :---------- | :---------- | | Operating activities | **$(56,367)** | **$(137,082)** | | Investing activities | **$1,027** | **$89,107** | | Financing activities | **$39,777** | **$61,808** | | (Decrease) Increase in cash, cash equivalents and restricted cash | **$(15,563)** | **$13,833** | | Cash, cash equivalents and restricted cash at end of year | **$42,855** | **$58,418** | - Net cash used in operating activities decreased by **$80.7 million** in 2021, primarily due to a lower net loss and reduced non-cash charges compared to 2020[438](index=438&type=chunk)[385](index=385&type=chunk)[386](index=386&type=chunk) - Net cash provided by investing activities decreased significantly in 2021, as 2020 included **$38.6 million** cash acquired through the merger[438](index=438&type=chunk)[387](index=387&type=chunk) - Net cash provided by financing activities decreased in 2021, with **$76.0 million** from stock issuance offset by **$36.4 million** in debt repayment[438](index=438&type=chunk)[388](index=388&type=chunk) - Overall cash, cash equivalents, and restricted cash decreased by **$15.6 million** in 2021[438](index=438&type=chunk) [Notes to Consolidated Financial Statements](index=80&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes provide detailed explanations of the company's operations, accounting policies, business combinations, revenue recognition, debt, income taxes, and subsequent events - Note 1 details the company's nature of operations, strategic business review, sale of the MST Franchise, and liquidity concerns, including substantial doubt about going concern[444](index=444&type=chunk)[445](index=445&type=chunk)[446](index=446&type=chunk)[447](index=447&type=chunk)[448](index=448&type=chunk)[449](index=449&type=chunk)[450](index=450&type=chunk)[451](index=451&type=chunk)[452](index=452&type=chunk)[458](index=458&type=chunk)[459](index=459&type=chunk)[460](index=460&type=chunk)[461](index=461&type=chunk)[462](index=462&type=chunk) - Note 2 outlines significant accounting policies, including basis of presentation, use of estimates (especially regarding COVID-19 impact), business acquisition accounting, foreign currency translation, consolidation principles, cash/marketable securities, inventory, property/equipment, impairment, goodwill, doubtful accounts, debt, leases, contingencies, and share-based compensation[463](index=463&type=chunk)[464](index=464&type=chunk)[465](index=465&type=chunk)[466](index=466&type=chunk)[467](index=467&type=chunk)[468](index=468&type=chunk)[469](index=469&type=chunk)[470](index=470&type=chunk)[471](index=471&type=chunk)[472](index=472&type=chunk)[473](index=473&type=chunk)[474](index=474&type=chunk)[475](index=475&type=chunk)[476](index=476&type=chunk)[477](index=477&type=chunk)[478](index=478&type=chunk)[479](index=479&type=chunk)[480](index=480&type=chunk)[481](index=481&type=chunk)[482](index=482&type=chunk)[483](index=483&type=chunk)[484](index=484&type=chunk)[485](index=485&type=chunk)[486](index=486&type=chunk)[487](index=487&type=chunk)[488](index=488&type=chunk)[489](index=489&type=chunk)[490](index=490&type=chunk)[491](index=491&type=chunk)[492](index=492&type=chunk)[493](index=493&type=chunk)[494](index=494&type=chunk)[495](index=495&type=chunk)[496](index=496&type=chunk)[497](index=497&type=chunk)[498](index=498&type=chunk)[499](index=499&type=chunk)[500](index=500&type=chunk)[501](index=501&type=chunk)[502](index=502&type=chunk)[503](index=503&type=chunk)[504](index=504&type=chunk)[505](index=505&type=chunk)[506](index=506&type=chunk)[507](index=507&type=chunk) - Note 3 details the **March 2020** reverse merger with Menlo Therapeutics, the conversion of Contingent Stock Rights (CSRs), and the allocation of purchase price, including the full impairment of **$4.5 million** goodwill and **$49.8 million** IPR&D in 2020 due to failed serlopitant trials[508](index=508&type=chunk)[509](index=509&type=chunk)[510](index=510&type=chunk)[511](index=511&type=chunk)[512](index=512&type=chunk)[513](index=513&type=chunk)[514](index=514&type=chunk)[515](index=515&type=chunk)[516](index=516&type=chunk)[517](index=517&type=chunk)[518](index=518&type=chunk)[519](index=519&type=chunk)[520](index=520&type=chunk)[521](index=521&type=chunk)[522](index=522&type=chunk)[523](index=523&type=chunk)[524](index=524&type=chunk)[525](index=525&type=chunk)[526](index=526&type=chunk)[527](index=527&type=chunk)[528](index=528&type=chunk) - Note 4 explains revenue recognition policies for product sales (net of provisions like rebates, chargebacks, returns) and license revenues, noting the assignment of the Cutia license to Journey[530](index=530&type=chunk)[531](index=531&type=chunk)[532](index=532&type=chunk)[533](index=533&type=chunk)[534](index=534&type=chunk)[535](index=535&type=chunk)[536](index=536&type=chunk)[537](index=537&type=chunk)[538](index=538&type=chunk)[539](index=539&type=chunk)[540](index=540&type=chunk)[541](index=541&type=chunk)[542](index=542&type=chunk) - Note 13 details the prepayment and termination of the **$35.0 million** long-term debt in **August 2021**, including a **$1.4 million** prepayment fee and **$1.6 million** write-off of deferred financing costs[568](index=568&type=chunk)[569](index=569&type=chunk)[570](index=570&type=chunk)[571](index=571&type=chunk)[572](index=572&type=chunk)[573](index=573&type=chunk)[574](index=574&type=chunk)[575](index=575&type=chunk) - Note 16 provides income tax details, including federal and state NOL carryforwards of **$315.0 million** and **$105.6 million** respectively, and a full valuation allowance against deferred tax assets[603](index=603&type=chunk)[604](index=604&type=chunk)[605](index=605&type=chunk)[606](index=606&type=chunk)[607](index=607&type=chunk)[608](index=608&type=chunk)[609](index=609&type=chunk)[610](index=610&type=chunk)[611](index=611&type=chunk)[612](index=612&type=chunk)[613](index=613&type=chunk) - Note 17 describes subsequent events, including the finalization of the MST Franchise sale, an estimated gain of **$13.5-$14.5 million**, and recent financing activities (sale of **2.47 million shares** for **$1.5 million** and a **$30.0 million** Equity Purchase Agreement with Lincoln Park)[614](index=614&type=chunk)[615](index=615&type=chunk)[616](index=616&type=chunk)[617](index=617&type=chunk)[618](index=618&type=chunk)[619](index=619&type=chunk)[620](index=620&type=chunk) [ITEM 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=72&type=section&id=ITEM%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) There have been no changes in or disagreements with accountants on accounting and financial disclosure matters - No changes in or disagreements with accountants on accounting and financial disclosure were reported[622](index=622&type=chunk) [ITEM 9A. Controls and Procedures](index=72&type=section&id=ITEM%209A.%20Controls%20and%20Procedures) Management, with CEO and CFO participation, evaluated the effectiveness of disclosure controls and procedures as of December 31, 2021, concluding they were effective at a reasonable assurance level. There were no material changes in internal control over financial reporting during the fourth quarter of 2021 - Disclosure controls and procedures were evaluated by management, including the CEO and CFO, and deemed effective at a reasonable assurance level as of **December 31, 2021**[623](index=623&type=chunk)[624](index=624&type=chunk) - No material changes in internal control over financial reporting occurred during the fourth quarter ended **December 31, 2021**[625](index=625&type=chunk) - Management assessed the effectiveness of internal control over financial reporting using COSO criteria and concluded it was effective as of **December 31, 2021**[626](index=626&type=chunk)[627](index=627&type=chunk)[628](index=628&type=chunk) [ITEM 9B. Other Information](index=72&type=section&id=ITEM%209B.%20Other%20Information) This item reports that there is no other information required to be disclosed - No other information is reported under this item[629](index=629&type=chunk) [ITEM 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections](index=72&type=section&id=ITEM%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20That%20Prevent%20Inspections) This item is not applicable to VYNE Therapeutics Inc - This item is not applicable[631](index=631&type=chunk) [PART III](index=73&type=section&id=PART%20III) This section details corporate governance, executive compensation, security ownership, related party transactions, and auditor fees [ITEM 10. Directors, Executive Officers and Corporate Governance](index=73&type=section&id=ITEM%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) This section provides information on VYNE Therapeutics' executive officers and Board of Directors, including their ages, positions, and professional backgrounds. It also details the company's corporate governance guidelines, board leadership structure (with a lead independent director), and the roles and composition of its Audit, Compensation, and Nominating and Corporate Governance Committees. Policies on stockholder communications, code of ethics, and prohibitions on margin accounts/hedging are also covered Executive Officers and Directors (as of December 31, 2021) | Name | Age | Position(s) | | :--------------- | :-- | :--------------------------------------------- | | David Domzalski | **55** | President, CEO, and Director | | Tyler Zeronda | **36** | Chief Financial Officer and Treasurer | | Iain Stuart, Ph.D. | **49** | Chief Scientific Officer | | Mutya Harsch | **47** | Chief Legal Officer, General Counsel, Secretary | | Sharon Barbari | **67** | Director (Audit, Comp, Nom/Corp Gov) | | Steven Basta | **56** | Director | | Anthony Bruno | **65** | Director (Comp, Nom/Corp Gov) | | Patrick LePore | **66** | Lead Independent Director (Audit, Nom/Corp Gov)| | Elisabeth Sandoval | **60** | Director (Audit, Comp) | - The Board has a **lead independent director** (Patrick LePore) to strengthen independence and governance[647](index=647&type=chunk)[648](index=648&type=chunk) - The Board oversees risk assessment, with management discussing strategic and operational risks at regular meetings[649](index=649&type=chunk) - The Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee are composed of independent directors[650](index=650&type=chunk)[652](index=652&type=chunk)[656](index=656&type=chunk)[661](index=661&type=chunk) - The company has a **Code of Business Conduct and Ethics** applicable to all employees, officers, and directors, and prohibits margin accounts and hedging activities for company securities[667](index=667&type=chunk)[668](index=668&type=chunk) [ITEM 11. Executive Compensation](index=78&type=section&id=ITEM%2011.%20Executive%20Compensation) This section details the compensation of VYNE Therapeutics' named executive officers (NEOs) and non-executive directors for 2021 and 2020. It includes base salaries, bonuses, and equity awards, highlighting the retention awards issued in September 2021 to incentivize employees during the strategic transition. Employment agreements with NEOs outline severance and change-of-control provisions. Director compensation includes annual cash retainers and equity grants, with adjustments made in 2021 Summary Compensation Table for NEOs (Years Ended December 31, in USD) | Name | Year | Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | All Other Compensation ($) | Total Compensation ($) | | :-------------- | :--- | :--------- | :-------- | :--------------- | :--------

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ___ TO ___. UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q Commission file number 001-38356 VYNE THERAPEUTICS INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporat ...

PART I – FINANCIAL INFORMATION [Item 1. Unaudited Condensed Consolidated Financial Statements](index=6&type=section&id=Item%201.%20Unaudited%20Financial%20Statements) Presents VYNE Therapeutics Inc.'s unaudited consolidated financial statements and related accounting notes for interim periods ending June 30, 2021 [Unaudited Condensed Consolidated Balance Sheets](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Unaudited consolidated balance sheets detail assets, liabilities, and shareholders' equity changes between December 31, 2020, and June 30, 2021 | Metric (in thousands) | June 30, 2021 | December 31, 2020 | | :-------------------- | :------------ | :---------------- | | **Assets** | | | | Cash and cash equivalents | $103,406 | $57,563 | | Total Current Assets | $128,426 | $87,259 | | Total Assets | $133,983 | $93,742 | | **Liabilities** | | | | Total Current Liabilities | $57,620 | $21,453 | | Total Liabilities | $59,090 | $56,249 | | **Shareholders' Equity** | | | | Total Shareholders' Equity | $74,893 | $37,493 | - Total assets increased by **$40.2 million (42.9%)** from **$93.7 million** at December 31, 2020, to **$134.0 million** at June 30, 2021, primarily driven by an increase in cash and cash equivalents[17](index=17&type=chunk) - Total liabilities increased by **$2.8 million (5.0%)** from **$56.2 million** at December 31, 2020, to **$59.1 million** at June 30, 2021, mainly due to an increase in current debt[17](index=17&type=chunk) - Total shareholders' equity significantly increased by **$37.4 million (99.7%)** from **$37.5 million** at December 31, 2020, to **$74.9 million** at June 30, 2021[17](index=17&type=chunk) [Unaudited Condensed Consolidated Statements Of Operations](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20Of%20Operations) Unaudited consolidated statements of operations present revenues, expenses, and net loss for the three and six months ended June 30, 2021 and 2020 | Metric (in thousands, except per share data) | Three months ended June 30, 2021 | Three months ended June 30, 2020 | Six months ended June 30, 2021 | Six months ended June 30, 2020 | | :------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Product sales | $3,963 | $1,483 | $7,852 | $3,233 | | License revenues | — | $10,000 | — | $10,000 | | Royalty revenues | $295 | $205 | $525 | $205 | | Total Revenues | $4,258 | $11,688 | $8,377 | $13,438 | | Cost of goods sold | $795 | $216 | $1,396 | $487 | | Research and development | $6,409 | $13,119 | $12,742 | $29,072 | | Selling, general and administrative | $15,835 | $26,459 | $32,451 | $51,874 | | Goodwill and IPR&D impairments | — | $54,345 | — | $54,345 | | Contingent Stock Right Remeasurement | — | $84,726 | — | $84,726 | | Total Operating Expenses | $22,244 | $178,649 | $45,193 | $220,017 | | Operating Loss | $18,781 | $167,177 | $38,212 | $207,066 | | Net Loss | $19,924 | $167,440 | $40,474 | $207,673 | | Loss per share basic and diluted | $0.39 | $4.83 | $0.81 | $9.17 | - Total revenues decreased significantly for both the three-month and six-month periods ended June 30, 2021, primarily due to the absence of a **$10.0 million** license revenue recognized in Q2 2020[19](index=19&type=chunk) - Net loss decreased substantially for both periods, from **$167.4 million** to **$19.9 million** (three months) and from **$207.7 million** to **$40.5 million** (six months), mainly due to the absence of goodwill and IPR&D impairments and contingent stock right remeasurement expenses incurred in 2020[19](index=19&type=chunk) [Unaudited Condensed Consolidated Statements Of Comprehensive Loss](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20Of%20Comprehensive%20Loss) Unaudited consolidated statements of comprehensive loss present net loss and other comprehensive income/loss for the three and six months ended June 30, 2021 and 2020 | Metric (in thousands) | Three months ended June 30, 2021 | Three months ended June 30, 2020 | Six months ended June 30, 2021 | Six months ended June 30, 2020 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net Loss | $19,924 | $167,440 | $40,474 | $207,673 | | Total Other Comprehensive Loss | — | $(40) | — | $5 | | Total Comprehensive Loss | $19,924 | $167,400 | $40,474 | $207,678 | - Total comprehensive loss decreased significantly in 2021 compared to 2020, mirroring the reduction in net loss, with minimal impact from other comprehensive income/loss items[22](index=22&type=chunk) [Unaudited Condensed Consolidated Statements Of Changes In Stockholders' Equity](index=9&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20Of%20Changes%20In%20Stockholders'%20Equity) Unaudited consolidated statements of changes in stockholders' equity detail common stock, additional paid-in capital, and accumulated deficit for the six months ended June 30, 2021 | Metric (in thousands, except share data) | Balance at Jan 1, 2021 | Changes during period | Balance at June 30, 2021 | | :--------------------------------------- | :--------------------- | :-------------------- | :----------------------- | | Common stock (shares) | 43,205,221 | 8,306,624 | 51,511,845 | | Common stock (amounts) | $4 | $1 | $5 | | Additional paid-in capital | $603,685 | $73,570 | $681,558 | | Accumulated deficit | $(566,196) | $(40,474) | $(606,670) | | Total Shareholders' Equity | $37,493 | $37,400 | $74,893 | - Shareholders' equity increased by **$37.4 million** during the six months ended June 30, 2021, primarily driven by proceeds from common stock issuances totaling **$73.1 million**, offset by a net loss of **$40.5 million**[25](index=25&type=chunk) - The number of common shares outstanding increased by over **8.3 million** shares during the first six months of 2021 due to at-the-market and registered direct offerings, and employee stock plans[25](index=25&type=chunk) [Unaudited Condensed Consolidated Statements Of Cash Flows](index=11&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20Of%20Cash%20Flows) Unaudited consolidated statements of cash flows summarize cash movements from operating, investing, and financing activities for the six months ended June 30, 2021 and 2020 | Metric (in thousands) | Six months ended June 30, 2021 | Six months ended June 30, 2020 | | :-------------------- | :----------------------------- | :----------------------------- | | Net Loss | $40,474 | $207,673 | | Net cash used in operating activities | $(28,808) | $(88,070) | | Net cash provided by investing activities | $1,027 | $87,105 | | Net cash provided by financing activities | $73,374 | $53,746 | | Increase in cash, cash equivalents and restricted cash | $45,593 | $52,781 | | Cash, cash equivalents and restricted cash at end of the period | $104,011 | $97,366 | - Net cash used in operating activities decreased significantly from **$88.1 million** in H1 2020 to **$28.8 million** in H1 2021, reflecting reduced net losses and operational adjustments[31](index=31&type=chunk) - Net cash provided by financing activities increased to **$73.4 million** in H1 2021 from **$53.7 million** in H1 2020, primarily due to proceeds from common stock offerings[31](index=31&type=chunk) - Cash, cash equivalents, and restricted cash at the end of the period increased to **$104.0 million** as of June 30, 2021, from **$97.4 million** as of June 30, 2020[31](index=31&type=chunk) [Notes to Unaudited Interim Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Unaudited%20Interim%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes explaining the company's operations, significant accounting policies, and financial statement components [NOTE 1 - NATURE OF OPERATIONS](index=13&type=section&id=NOTE%201%20-%20NATURE%20OF%20OPERATIONS) VYNE Therapeutics Inc. is a biopharmaceutical company transitioning its strategic focus to immuno-inflammatory diseases, divesting its topical minocycline products - VYNE is transitioning its strategic focus to immuno-inflammatory diseases, exploring a sale or license of its topical minocycline franchise (AMZEEQ, ZILXI, FCD105, MST platform)[36](index=36&type=chunk)[37](index=37&type=chunk)[159](index=159&type=chunk) - The company will continue to invest in FMX114 for atopic dermatitis (Phase 2a study expected by end of 2021) and has licensed BETi compounds (VYN201, VYN202) from In4Derm for topical and oral treatments, with clinical entry planned for 2022[37](index=37&type=chunk)[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk)[160](index=160&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk)[163](index=163&type=chunk) - A restructuring plan includes eliminating commercial operations expenditures and terminating approximately **70 employees** by December 31, 2021, with an expected one-time charge of **$1.5 million to $2.0 million**[41](index=41&type=chunk)[164](index=164&type=chunk) - The company's ability to continue as a going concern is contingent on successfully divesting its minocycline franchise, developing commercially viable drug candidates, and raising additional capital, as current cash flows are insufficient beyond one year from the financial statement issuance[51](index=51&type=chunk)[53](index=53&type=chunk)[205](index=205&type=chunk)[206](index=206&type=chunk) [NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES](index=16&type=section&id=NOTE%202%20-%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the significant accounting policies, including U.S. GAAP basis, consolidation principles, use of estimates, and impact of COVID-19 - The financial statements are prepared under U.S. GAAP, with management making estimates for business combinations, asset impairments, and revenue recognition[54](index=54&type=chunk)[57](index=57&type=chunk) - The COVID-19 pandemic has negatively impacted sales of AMZEEQ and ZILXI due to limited access to healthcare providers and unfavorable payor decisions, affecting financial condition and liquidity[50](index=50&type=chunk)[58](index=58&type=chunk)[185](index=185&type=chunk)[204](index=204&type=chunk) - Fair value measurements are categorized into Level 1, 2, or 3 inputs, with Level 3 inputs reflecting unobservable estimates and assumptions[72](index=72&type=chunk)[226](index=226&type=chunk) - The company adopted ASU 2019-12 (Income Taxes) in Q1 2021 with no material impact and is evaluating ASU 2020-4 (Reference Rate Reform); ASU 2016-13 (Credit Losses) will be adopted effective January 1, 2023, as a smaller reporting company[78](index=78&type=chunk)[79](index=79&type=chunk)[80](index=80&type=chunk) [NOTE 3 – BUSINESS COMBINATION](index=21&type=section&id=NOTE%203%20%E2%80%93%20BUSINESS%20COMBINATION) This note details the reverse acquisition of Menlo by Foamix on March 9, 2020, including purchase price allocation and contingent stock right remeasurement - The Merger on March 9, 2020, was accounted for as a reverse acquisition, with Foamix as the accounting acquirer, where Foamix shareholders received Menlo common stock and Contingent Stock Rights (CSRs)[81](index=81&type=chunk)[82](index=82&type=chunk)[84](index=84&type=chunk) - Following the failure of Menlo's Phase III PN Trials for serlopitant on April 6, 2020, each CSR converted into **1.2082** additional shares of Menlo common stock, resulting in an effective exchange ratio of **1.8006** shares for each Foamix ordinary share[83](index=83&type=chunk)[96](index=96&type=chunk) Purchase Price Allocation (March 9, 2020) | Item (in thousands) | Amount | | :------------------ | :----- | | Cash and cash equivalents | $38,641 | | Investment in marketable securities | $22,703 | | In-process research and development | $49,800 | | Goodwill | $4,545 | | Total assets | $117,270 | | Total liabilities | $(5,827) | | Purchase price | $111,443 | - A full impairment charge of **$4.5 million** for goodwill and **$49.8 million** for IPR&D was recorded in Q2 2020 due to the discontinuation of serlopitant development[91](index=91&type=chunk)[94](index=94&type=chunk) - The CSR liability was remeasured to **$104.4 million** on April 6, 2020, resulting in an **$84.7 million** expense, and then settled with the issuance of shares[98](index=98&type=chunk) [NOTE 4 – REVENUE RECOGNITION](index=26&type=section&id=NOTE%204%20%E2%80%93%20REVENUE%20RECOGNITION) This note details the company's revenue recognition policies under ASC Topic 606, primarily from product sales, license, and royalty revenues - Product sales for Q2 2021 were **$4.0 million**, up from **$1.5 million** in Q2 2020, driven by the ZILXI launch and increased AMZEEQ demand; for H1 2021, product sales were **$7.9 million**, up from **$3.2 million** in H1 2020[19](index=19&type=chunk)[100](index=100&type=chunk)[183](index=183&type=chunk)[193](index=193&type=chunk)[194](index=194&type=chunk) - License revenue of **$10.0 million** was recognized in Q2 2020 from an exclusive licensing agreement with Cutia for topical minocycline products in Greater China; no license revenue was recorded in 2021[19](index=19&type=chunk)[108](index=108&type=chunk)[183](index=183&type=chunk)[184](index=184&type=chunk)[193](index=193&type=chunk)[195](index=195&type=chunk) - Royalty revenues were **$0.3 million** for Q2 2021 (vs. **$0.2 million** in Q2 2020) and **$0.5 million** for H1 2021 (vs. **$0.2 million** in H1 2020)[19](index=19&type=chunk)[113](index=113&type=chunk)[183](index=183&type=chunk)[193](index=193&type=chunk) - Product revenue is recorded net of provisions for distribution fees, trade discounts, rebates, chargebacks, and estimated returns, which reduced product revenues by **$16.2 million** (Q2 2021) and **$31.8 million** (H1 2021)[103](index=103&type=chunk) [NOTE 5 - FAIR VALUE MEASUREMENT](index=29&type=section&id=NOTE%205%20-%20FAIR%20VALUE%20MEASUREMENT) This note provides information on the fair value measurement of the company's assets and liabilities, classified by input observability Fair Value Measurement (December 31, 2020) | Item | Level 1 (in thousands) | | :---------------- | :--------------------- | | Marketable securities | $1,027 | - The company sold all its marketable securities during the six months ended June 30, 2021[114](index=114&type=chunk) [NOTE 6 - MARKETABLE SECURITIES](index=29&type=section&id=NOTE%206%20-%20MARKETABLE%20SECURITIES) This note details the company's marketable securities, primarily Israeli mutual funds, all of which were sold in the first half of 2021 Marketable Securities (in thousands) | Item | June 30, 2021 | December 31, 2020 | | :---------------- | :------------ | :---------------- | | Israeli mutual funds | $— | $1,027 | - The company received **$1.0 million** from the sale and maturity of marketable securities during the six months ended June 30, 2021, compared to **$36.4 million** in the same period of 2020[117](index=117&type=chunk) [NOTE 7 – INVENTORY](index=30&type=section&id=NOTE%207%20%E2%80%93%20INVENTORY) This note provides a breakdown of the company's inventory, stated at the lower of cost and net realizable value, showing an increase in finished goods Inventory (in thousands) | Category | June 30, 2021 | December 31, 2020 | | :------------ | :------------ | :---------------- | | Raw materials | $3,466 | $4,042 | | Work-in-process | $680 | $662 | | Finished goods | $4,133 | $2,700 | | Total | $8,279 | $7,404 | - Total inventory increased by **$0.9 million (11.8%)** from December 31, 2020, to June 30, 2021, primarily due to an increase in finished goods[119](index=119&type=chunk) - No inventory write-downs occurred during the three and six months ended June 30, 2021, or June 30, 2020[118](index=118&type=chunk) [NOTE 8 - DEBT](index=30&type=section&id=NOTE%208%20-%20DEBT) This note details the company's debt under the Amended and Restated Credit Agreement, which was fully prepaid and terminated in August 2021 - Outstanding debt under the Amended and Restated Credit Agreement was **$35.0 million** as of June 30, 2021, and December 31, 2020[120](index=120&type=chunk) - On August 11, 2021, the company prepaid its entire outstanding indebtedness of approximately **$36.5 million**, including a **4%** prepayment fee and accrued interest, resulting in the termination of the credit agreement[123](index=123&type=chunk)[252](index=252&type=chunk) - Interest expense for the three and six months ended June 30, 2021, was **$1.1 million** and **$2.1 million**, respectively[127](index=127&type=chunk) [NOTE 9 – SHARE CAPITAL](index=31&type=section&id=NOTE%209%20%E2%80%93%20SHARE%20CAPITAL) This note outlines the company's share capital structure, including authorized stock, recent issuances, warrants, and share-based compensation - The number of authorized common stock shares was increased from **75 million** to **150 million** on July 19, 2021[131](index=131&type=chunk) - In January 2021, the company issued **2,778,012** shares of common stock through an at-the-market offering for **$26.3 million** net proceeds and **5,274,261** shares through a registered direct offering for **$46.8 million** net proceeds[133](index=133&type=chunk)[134](index=134&type=chunk) - Warrants to purchase **495,165** shares of common stock (adjusted for reverse stock split and CSR) with an exercise price of **$4.64** per share are outstanding and expire on July 29, 2026[124](index=124&type=chunk)[137](index=137&type=chunk) - Share-based compensation expense was **$1.9 million** for Q2 2021 and **$4.3 million** for H1 2021, a decrease from **$10.8 million** and **$12.5 million** in the respective 2020 periods[149](index=149&type=chunk) [NOTE 10 – OPERATING LEASE](index=34&type=section&id=NOTE%2010%20%E2%80%93%20OPERATING%20LEASE) This note details the company's operating lease agreements for corporate offices and vehicles, with total lease liabilities of $1.2 million as of June 30, 2021 Maturities of Lease Liabilities (in thousands) | Year | Amount | | :--- | :----- | | 2021 | $458 | | 2022 | $761 | | 2023 | $151 | | Total lease payments | $1,370 | | Less imputed interest | $124 | | Total lease liability | $1,246 | - As of June 30, 2021, the company had a **$0.6 million** lien on its cash to secure lease agreements[153](index=153&type=chunk) [NOTE 11 – COMMITMENTS AND CONTINGENCIES](index=35&type=section&id=NOTE%2011%20%E2%80%93%20COMMITMENTS%20AND%20CONTINGENCIES) This note addresses legal proceedings, specifically a patent infringement suit initiated against Padagis regarding a generic AMZEEQ, delaying FDA approval - On June 30, 2021, the company received a Paragraph IV certification notice from Padagis Israel Pharmaceuticals Ltd. for a generic version of AMZEEQ, alleging patent invalidity or non-infringement[155](index=155&type=chunk)[238](index=238&type=chunk) - VYNE initiated a patent infringement suit against Padagis on August 9, 2021, which legally prevents FDA approval of the generic ANDA before December 30, 2023, or a court decision[156](index=156&type=chunk)[239](index=239&type=chunk) - The company intends to vigorously defend its intellectual property rights, with the latest patent expiring on September 8, 2037[157](index=157&type=chunk)[240](index=240&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition and operational results, highlighting a strategic shift to immuno-inflammatory disease pipeline development and associated financial challenges [Company Overview](index=36&type=section&id=Company%20Overview) VYNE is transitioning its strategic focus from commercializing minocycline products to developing therapies for immuno-inflammatory diseases - VYNE is transitioning its strategic focus from commercializing AMZEEQ and ZILXI to developing therapies for immuno-inflammatory diseases, including FMX114 and BETi compounds (VYN201, VYN202)[159](index=159&type=chunk)[160](index=160&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk)[163](index=163&type=chunk) - The company is exploring a sale or license of its topical minocycline franchise and plans to reduce its workforce by approximately **70 employees** by December 31, 2021, incurring a one-time charge of **$1.5 million to $2.0 million**[159](index=159&type=chunk)[164](index=164&type=chunk) [Key Developments](index=37&type=section&id=Key%20Developments) This section outlines significant corporate and financial developments, including capital raises, formulary decisions, stock splits, and legal actions - In January 2021, the company raised **$26.3 million** and **$46.7 million** net proceeds from at-the-market and registered direct common stock offerings, respectively[165](index=165&type=chunk) - CVS Caremark decided not to include AMZEEQ and ZILXI on its national formulary for 2021, potentially impacting future pricing[165](index=165&type=chunk) - A one-for-four reverse stock split was effected on February 12, 2021, reducing authorized shares from **300 million** to **75 million**, later increased to **150 million** on July 19, 2021[165](index=165&type=chunk) - The company initiated a patent infringement suit against Padagis on August 9, 2021, regarding a generic AMZEEQ, which delays FDA approval of the generic until at least December 30, 2023[165](index=165&type=chunk) - On August 11, 2021, the company prepaid its **$35.0 million** outstanding debt, including a **4%** premium, totaling approximately **$36.5 million**, terminating the credit agreement[165](index=165&type=chunk) [Financial Overview](index=38&type=section&id=Financial%20Overview) The company incurred significant net losses and an accumulated deficit, necessitating substantial additional financing for its strategic shift to pipeline development - The company incurred net losses of **$19.9 million** and **$167.4 million** for the three months ended June 30, 2021 and 2020, respectively, and an accumulated deficit of **$606.7 million** as of June 30, 2021[167](index=167&type=chunk) - The strategic shift to immuno-inflammatory pipeline development requires significant additional financing, and the company's future viability depends on successful execution and capital raising[168](index=168&type=chunk) [Components of Operating Results](index=38&type=section&id=Components%20of%20Operating%20Results) This section analyzes the individual components contributing to the company's operating results, including revenues, cost of goods sold, and various operating expenses [Revenues](index=38&type=section&id=Revenues) Revenues primarily consist of product sales and royalties, with no license revenue recorded in the current period compared to a significant amount in the prior year - Product sales for the six months ended June 30, 2021, were **$7.9 million**, primarily from AMZEEQ and ZILXI, compared to **$3.2 million** in the prior year[170](index=170&type=chunk)[193](index=193&type=chunk) - Royalty revenues for the six months ended June 30, 2021, were **$0.5 million**, up from **$0.2 million** in the prior year[171](index=171&type=chunk)[193](index=193&type=chunk) - No license revenue was recorded for the six months ended June 30, 2021, compared to **$10.0 million** in the prior year from the Cutia agreement[173](index=173&type=chunk)[193](index=193&type=chunk) [Cost of Goods Sold](index=39&type=section&id=Cost%20of%20Goods%20Sold) Cost of goods sold increased due to higher sales volume, while gross margin percentage remained favorable due to previously expensed materials - Cost of goods sold increased to **$1.4 million** for H1 2021 from **$0.5 million** for H1 2020, primarily due to increased sales volume[174](index=174&type=chunk)[196](index=196&type=chunk) - Gross margin percentage was **82%** for H1 2021 and **85%** for H1 2020, favorably impacted by expensed materials produced prior to FDA approval[175](index=175&type=chunk)[197](index=197&type=chunk) [Operating Expenses](index=39&type=section&id=Operating%20Expenses) Research and development and selling, general and administrative expenses significantly decreased in H1 2021 due to reduced employee-related costs and merger-related professional services - Research and development expenses decreased by **$16.3 million (56.2%)** to **$12.7 million** for H1 2021, mainly due to reduced employee-related expenses (severance costs in 2020) and completion of clinical trials[176](index=176&type=chunk)[198](index=198&type=chunk) - Selling, general and administrative expenses decreased by **$19.4 million (37.4%)** to **$32.5 million** for H1 2021, primarily due to lower employee-related expenses (severance costs in 2020) and professional services related to the Merger[179](index=179&type=chunk)[199](index=199&type=chunk) [Interest Expense](index=40&type=section&id=Interest%20Expense) Interest expense remained consistent for both the first half of 2021 and 2020 - Interest expense remained consistent at **$2.1 million** for both H1 2021 and H1 2020[200](index=200&type=chunk) [Other Expense, net](index=40&type=section&id=Other%20Expense,%20net) Other expense, net shifted from income in H1 2020 to an expense in H1 2021, primarily due to a decrease in gains on derivative liabilities - Other expense, net was **$0.1 million** expense for H1 2021, compared to **$1.3 million** income for H1 2020, primarily due to a decrease in gains on derivative liabilities[201](index=201&type=chunk) [Income Taxes and Net Operating Loss Carryforwards](index=40&type=section&id=Income%20Taxes%20and%20Net%20Operating%20Loss%20Carryforwards) No income tax expense was recorded in H1 2021, and the company holds significant federal and state net operating loss carryforwards subject to potential limitations - No income tax expense was recorded for H1 2021, compared to a **$0.3 million** benefit for H1 2020[202](index=202&type=chunk) - As of December 31, 2020, the company had federal NOL carryforwards of **$243.2 million** and state NOLs of **$66.3 million**, with **$198.9 million** in federal and state NOLs having no limited period of use[181](index=181&type=chunk) - NOLs and tax credits may be subject to annual limitations due to ownership changes under Sections 382 and 383 of the Internal Revenue Code[182](index=182&type=chunk) [Results of Operations](index=40&type=section&id=Results%20of%20Operations) This section provides a comparative analysis of the company's financial performance for the three-month and six-month periods ended June 30, 2021 and 2020 [Comparison of the Three-Month Periods Ended June 30, 2021 and 2020](index=40&type=section&id=Comparison%20of%20the%20Three-Month%20Periods%20Ended%20June%2030,%202021%20and%202020) Total revenues significantly decreased due to the absence of license revenue, while net loss substantially improved due to lower operating expenses Key Financials (Three Months Ended June 30) | Metric (in thousands) | 2021 | 2020 | Change ($) | Change (%) | | :-------------------- | :------ | :------- | :--------- | :--------- | | Total Revenues | $4,258 | $11,688 | $(7,430) | -63.6% | | Product sales | $3,963 | $1,483 | $2,480 | 167.2% | | License revenues | — | $10,000 | $(10,000) | -100.0% | | R&D Expenses | $6,409 | $13,119 | $(6,710) | -51.1% | | SG&A Expenses | $15,835 | $26,459 | $(10,624) | -40.2% |\ | Net Loss | $19,924 | $167,440 | $(147,516) | -88.1% | - The significant decrease in total revenues was primarily due to the absence of the **$10.0 million** license revenue from the Cutia agreement in 2020[184](index=184&type=chunk) - Net loss decreased substantially due to lower R&D and SG&A expenses, which were impacted by severance costs and merger-related professional services in 2020[188](index=188&type=chunk)[189](index=189&type=chunk) [Comparison of the Six-Month Periods Ended June 30, 2021 and 2020](index=41&type=section&id=Comparison%20of%20the%20Six-Month%20Periods%20Ended%20June%2030,%202021%20and%202020) Total revenues decreased due to the absence of license revenue, while net loss significantly improved due to reduced operating expenses Key Financials (Six Months Ended June 30) | Metric (in thousands) | 2021 | 2020 | Change ($) | Change (%) | | :-------------------- | :------ | :------- | :--------- | :--------- | | Total Revenues | $8,377 | $13,438 | $(5,061) | -37.7% | | Product sales | $7,852 | $3,233 | $4,619 | 142.9% | | License revenues | — | $10,000 | $(10,000) | -100.0% | | R&D Expenses | $12,742 | $29,072 | $(16,330) | -56.2% | | SG&A Expenses | $32,451 | $51,874 | $(19,423) | -37.4% | | Net Loss | $40,474 | $207,673 | $(167,199) | -80.5% | - The decrease in total revenues for H1 2021 was primarily due to the absence of the **$10.0 million** license revenue from 2020[195](index=195&type=chunk) - Net loss decreased substantially due to lower R&D and SG&A expenses, which were impacted by severance costs and merger-related professional services in 2020[198](index=198&type=chunk)[199](index=199&type=chunk) [Liquidity and Capital Resources](index=43&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is supported by cash and recent financing, but substantial doubt exists about its going concern ability without additional funding or asset divestiture - As of June 30, 2021, the company had **$104.0 million** in cash, cash equivalents, restricted cash, and investments[203](index=203&type=chunk) - The company prepaid its **$35.0 million** outstanding debt on August 11, 2021, for approximately **$36.5 million**, terminating the credit agreement[203](index=203&type=chunk)[205](index=205&type=chunk) - The COVID-19 pandemic and unfavorable payor decisions have negatively impacted sales of AMZEEQ and ZILXI, impairing revenue generation and liquidity[204](index=204&type=chunk) - The company's ability to continue as a going concern is in substantial doubt, as it will require significant additional financing beyond one year from the financial statement issuance to fund operations, especially for its new R&D focus[205](index=205&type=chunk)[206](index=206&type=chunk) [Summary Statement of Cash Flows](index=44&type=section&id=Summary%20Statement%20of%20Cash%20Flows) This section provides a summary of cash flows from operating, investing, and financing activities for the six months ended June 30, 2021 and 2020 Summary Cash Flows (Six Months Ended June 30) | Activity (in thousands) | 2021 | 2020 | | :---------------------- | :-------- | :-------- | | Operating activities | $(28,808) | $(88,070) | | Investing activities | $1,027 | $87,105 | | Financing activities | $73,374 | $53,746 | [Cash Used in Operating Activities](index=44&type=section&id=Cash%20Used%20in%20Operating%20Activities) Net cash used in operating activities significantly decreased in H1 2021 due to increased revenues and reduced merger-related costs - Net cash used in operating activities decreased to **$28.8 million** in H1 2021 from **$88.1 million** in H1 2020, driven by increased revenues from AMZEEQ and ZILXI launches and reduced Merger-related costs[209](index=209&type=chunk) [Cash Used in (Provided by) Investing Activities](index=45&type=section&id=Cash%20Used%20in%20(Provided%20by)%20Investing%20Activities) Net cash provided by investing activities significantly decreased in H1 2021, primarily due to cash acquired through the Merger and reduced marketable securities investments in 2020 - Net cash provided by investing activities decreased significantly to **$1.0 million** in H1 2021 from **$87.1 million** in H1 2020, primarily due to cash acquired through the Merger and a decrease in marketable securities investments in 2020[210](index=210&type=chunk) [Cash Provided by Financing Activities](index=45&type=section&id=Cash%20Provided%20by%20Financing%20Activities) Net cash provided by financing activities increased in H1 2021, mainly due to proceeds from common stock offerings - Net cash provided by financing activities increased to **$73.4 million** in H1 2021 from **$53.7 million** in H1 2020, mainly due to proceeds from common stock offerings in January 2021[211](index=211&type=chunk) [Cash and Funding Sources](index=45&type=section&id=Cash%20and%20Funding%20Sources) Liquidity in H1 2021 stemmed from common stock offerings and product sales, while H1 2020 liquidity primarily came from cash and investments acquired in the Merger - Liquidity sources in H1 2021 included proceeds from common stock offerings and sales of AMZEEQ and ZILXI[212](index=212&type=chunk) - Liquidity sources in H1 2020 primarily consisted of cash and investments acquired in the Merger[212](index=212&type=chunk) [Funding Requirements](index=45&type=section&id=Funding%20Requirements) Future funding requirements depend on asset divestiture, cost reductions, pipeline progress, and regulatory/IP expenses, potentially necessitating additional capital through equity, debt, or collaborations - Future funding requirements depend on proceeds from the potential sale/license of the minocycline franchise, reduction of commercialization costs, progress of pipeline candidates (FMX114, VYN201, VYN202), regulatory approval costs, and intellectual property expenses[214](index=214&type=chunk) - The company may need additional capital sooner than planned through equity, debt, or strategic collaborations, which could result in dilution or debt covenants[214](index=214&type=chunk) [Critical Accounting Policies, Significant Judgments and Use of Estimates](index=45&type=section&id=Critical%20Accounting%20Policies,%20Significant%20Judgments%20and%20Use%20of%20Estimates) Financial statement preparation requires significant estimates and judgments, particularly for business combinations, asset impairments, and revenue recognition, with ongoing COVID-19 impact assessments - The preparation of financial statements requires significant estimates and assumptions, particularly for business combinations, asset impairments, and revenue recognition[215](index=215&type=chunk)[216](index=216&type=chunk) - The COVID-19 pandemic has negatively impacted operations and sales, requiring ongoing assessment of accounting matters like allowances, inventory, impairments, and revenue recognition[219](index=219&type=chunk) - Revenue recognition follows a five-step model under ASC 606, involving identification of performance obligations, transaction price, allocation, and recognition upon satisfaction[220](index=220&type=chunk)[221](index=221&type=chunk)[222](index=222&type=chunk) - Business acquisitions are accounted for using the acquisition method, recognizing acquired assets and liabilities at fair value, with complex judgments and estimates involved[223](index=223&type=chunk)[224](index=224&type=chunk)[225](index=225&type=chunk)[226](index=226&type=chunk) - Long-lived assets are reviewed for impairment indicators throughout the year, with indefinite-lived intangible assets tested annually[227](index=227&type=chunk) - The company has no material off-balance sheet arrangements and indemnifies officers and directors, with the fair value of these rights deemed minimal[228](index=228&type=chunk)[229](index=229&type=chunk) - The company has opted out of the JOBS Act extended transition period for new accounting standards, irrevocably choosing to comply as required when adopted[230](index=230&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=49&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) VYNE Therapeutics Inc. is exempt from providing quantitative and qualitative disclosures about market risk as a smaller reporting company - VYNE Therapeutics Inc. is exempt from providing market risk disclosures as a smaller reporting company[233](index=233&type=chunk) [Item 4. Controls and Procedures](index=49&type=section&id=Item%204.%20Controls%20and%20Procedures) Management evaluated the effectiveness of the company's disclosure controls and procedures, concluding they were effective with no material changes in internal control over financial reporting - Disclosure controls and procedures were evaluated as effective at a reasonable assurance level as of June 30, 2021[234](index=234&type=chunk) - No material changes in internal control over financial reporting occurred during the three months ended June 30, 2021[235](index=235&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=50&type=section&id=Item%201%20Legal%20Proceedings) No material adverse legal proceedings were pending as of June 30, 2021, though a patent infringement suit was initiated against Padagis regarding a generic AMZEEQ - No material adverse legal claims were pending against the company as of June 30, 2021[237](index=237&type=chunk) - A patent infringement suit was filed against Padagis on August 9, 2021, concerning a generic AMZEEQ, which will delay FDA approval of the generic until at least December 30, 2023[238](index=238&type=chunk)[239](index=239&type=chunk) [Item 1A. Risk Factors](index=50&type=section&id=Item%201A.%20Risk%20Factors) This section updates risk factors related to the company's strategic shift, including divestiture uncertainty, funding requirements, going concern doubts, and intellectual property litigation [Risks Related to our Business Strategy](index=50&type=section&id=Risks%20Related%20to%20our%20Business%20Strategy) The decision to divest commercial assets and refocus on early-stage pipeline development presents significant risks, including transaction uncertainty and potential negative impacts on the business - The decision to sell or license the commercial business (AMZEEQ, ZILXI) may not result in a successful transaction or create shareholder value, potentially impacting business, financial condition, and stock price[241](index=241&type=chunk)[242](index=242&type=chunk) - The divestiture process is time-consuming, disruptive, and could incur substantial expenses, negatively affecting key personnel retention and diverting management's attention[243](index=243&type=chunk) - The company's future is dependent on the successful, but uncertain and expensive, development of early-stage drug candidates like FMX114 and BETi platform compounds[244](index=244&type=chunk) [Risks Related to our Liquidity](index=51&type=section&id=Risks%20Related%20to%20our%20Liquidity) The company requires substantial additional funding to continue operations, and an inability to raise capital could lead to R&D delays or termination, raising going concern doubts - The company requires substantial additional funding to continue operations, and its inability to raise capital could lead to delays, reductions, or termination of R&D activities, raising substantial doubt about its ability to continue as a going concern[245](index=245&type=chunk) - Issuing equity or debt for funding may dilute stockholders or impose restrictive covenants, while collaborations might require relinquishing valuable rights[245](index=245&type=chunk) [Risks Related to our Intellectual Property](index=51&type=section&id=Risks%20Related%20to%20our%20Intellectual%20Property) The ongoing patent infringement suit against Padagis for generic AMZEEQ poses substantial costs and risks, including potential patent invalidation or narrow interpretation - The company faces substantial costs and management distraction from the patent infringement suit against Padagis regarding a generic AMZEEQ, which could result in patent invalidation or narrow interpretation[246](index=246&type=chunk)[247](index=247&type=chunk) - An adverse outcome in litigation could put the company's patents at risk and negatively affect its development and commercialization efforts[247](index=247&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=52&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds occurred during the reporting period - No unregistered sales of equity securities or use of proceeds occurred during the reporting period[248](index=248&type=chunk) [Item 3. Defaults Upon Senior Securities](index=52&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported for the period - No defaults upon senior securities were reported[249](index=249&type=chunk) [Item 4. Mine Safety Disclosures](index=52&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company's operations - Mine safety disclosures are not applicable to VYNE Therapeutics Inc.[250](index=250&type=chunk) [Item 5. Other Information](index=52&type=section&id=Item%205.%20Other%20Information) This section details the company's restructuring plan, including asset divestiture and workforce reduction, and the prepayment of its outstanding indebtedness [Restructuring Plan](index=52&type=section&id=Restructuring%20Plan) The company initiated a restructuring plan to divest its minocycline franchise, reduce commercial operating expenses, and implement a workforce reduction - The company initiated a restructuring plan to explore a sale or license of its minocycline franchise and significantly reduce commercial operating expenses[251](index=251&type=chunk) - The plan includes terminating approximately **70 employees** by December 31, 2021, with an expected one-time charge of **$1.5 million to $2.0 million**[251](index=251&type=chunk) [Prepayment of Indebtedness](index=52&type=section&id=Prepayment%20of%20Indebtedness) The company prepaid its entire outstanding debt of $35.0 million, including a premium, totaling approximately $36.5 million, resulting in the termination of the credit agreement - On August 11, 2021, the company prepaid its entire outstanding indebtedness of **$35.0 million**, plus a **$1.4 million** prepayment premium and accrued interest, totaling approximately **$36.5 million**[252](index=252&type=chunk) - The prepayment resulted in the termination of the Amended and Restated Credit Agreement and all associated security interests[252](index=252&type=chunk) [Item 6. Exhibits](index=53&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Quarterly Report on Form 10-Q, including corporate governance documents and certifications - The exhibit index includes corporate documents (Amended and Restated Certificate of Incorporation, Bylaws), officer certifications (CEO, CFO), and XBRL instance and taxonomy documents[254](index=254&type=chunk) SIGNATURES The report was signed by the President and CEO, and the Chief Financial Officer and Treasurer on August 12, 2021 - The report was signed on August 12, 2021, by David Domzalski (President and CEO) and Tyler Zeronda (Chief Financial Officer and Treasurer)[260](index=260&type=chunk)

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, 2021 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 001-38356 VYNE THERAPEUTICS INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation ...

| --- | --- | --- | --- | --- | |-----------------------------------|-------|--------------|------------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | TM | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | THERAPEUTICS | | | | INVESTOR PRESENTATION March 2021 | | | | | | | | | | | | | | | ROOTED F | | | | | | INNOVATION | | Forward Looking Statements 2 This presentation includes forward-looking statements within the meaning of the Private Securiti ...

| --- | --- | --- | --- | --- | |-----------------------------------|-------|--------------|------------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | TM | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | THERAPEUTICS | | | | INVESTOR PRESENTATION March 2021 | | | | | | | | | | | | | | | ROOTED F | | | | | | INNOVATION | | Forward Looking Statements 2 This presentation includes forward-looking statements within the meaning of the Private Securiti ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION (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, 2020 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 001-38356 Washington, D.C. 20549 FORM 10-K VYNE THERAPEUTICS INC. (Exact name of registrant as specified in its charter) Delaware 45-3757789 (S ...

VYNE Therapeutics (NASDAQ:VYNE) Q3 2020 Earnings Conference Call November 5, 2020 8:30 AM ET Company Participants Michael Wood - LifeSci Advisors David Domzalski - Chief Executive Officer Matthew Wiley - Chief Commercial Officer Andrew Saik - Chief Financial Officer Conference Call Participants Carvey Leung - Cantor Fitzgerald David Amsellem - Piper Sandler & Co. Ken Cacciatore - Cowen and Company Patrick Dolezal - LifeSci Capital Operator Good day, and welcome to the VYNE Therapeutics Third Quarter 2020 Ea ...

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 SEPTEMBER 30, 2020 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 001-38356 VYNE THERAPEUTICS INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporat ...