Scilex pany(SCLX) - 2025 Q1 - Quarterly Report

Financial Performance - Net revenue for Q1 2025 was $5,004,000, a decrease of 54.9% compared to $10,884,000 in Q1 2024[23] - Net loss for Q1 2025 was $26,080,000, compared to a net loss of $24,377,000 in Q1 2024, indicating an increase in loss of 7.0%[23] - The company reported a loss per share of $2.26 for Q1 2025, compared to a loss per share of $8.33 in Q1 2024[23] - The net loss for the three months ended March 31, 2025, was $26.08 million, compared to a net loss of $24.38 million for the same period in 2024[28] - Net cash proceeds from operating activities were $6.01 million, a decrease from $9.39 million in the prior year[28] Assets and Liabilities - Total current assets decreased to $28,704,000 as of March 31, 2025, down from $41,547,000 as of December 31, 2024, representing a decline of 30.9%[20] - Total liabilities increased to $290,460,000 as of March 31, 2025, compared to $285,594,000 as of December 31, 2024, reflecting a rise of 1.0%[20] - Total stockholders' deficit increased to $211,484,000 as of March 31, 2025, compared to $192,641,000 as of December 31, 2024, an increase of 9.7%[20] - Cash and cash equivalents rose to $5,800,000 as of March 31, 2025, up from $3,272,000 as of December 31, 2024, marking an increase of 77.2%[20] Expenses - Research and development expenses for Q1 2025 were $2,456,000, down 20.9% from $3,108,000 in Q1 2024[23] - Selling, general and administrative expenses decreased to $28,060,000 in Q1 2025, a reduction of 4.2% from $29,278,000 in Q1 2024[23] - The Company reported operating losses of $27.9 million during the three months ended March 31, 2025, with cash flows from operating activities amounting to $6.0 million[60] Shareholder Information - The weighted average number of shares during Q1 2025 was 11,565,000, significantly higher than 2,926,000 in Q1 2024[23] - The Company has outstanding warrants totaling 1,000,000 Private Warrants and 57,512,958 December 2024 RDO Common Warrants, with a fair value of derivative warrant liabilities at $7.9 million[92] - As of March 31, 2025, options to purchase 1,022,353 shares of Common Stock were outstanding under all equity incentive plans, with a weighted-average exercise price of $138.17[190] Revenue Sources - The company had three customers that generated 99% of total revenue for the three months ended March 31, 2025, compared to 85% in 2024[39] - The Company will receive 50% of the net revenue generated from the commercialization of Gloperba Products outside the U.S.[77] - The Elyxyb License Agreement stipulates that the licensee will also receive 50% of the Canadian net revenue from Elyxyb Products[82] Research and Development - The company is developing three product candidates: SP-102, SP-103, and SP-104, with SP-102 having completed a Phase 3 study[33] - The company launched ELYXYB in the U.S. in April 2023 and commercialized GLOPERBA in June 2024[32] - The company incurred $566,000 in in-process research and development expenses during the quarter[28] Debt and Financing - The Company plans to obtain additional resources to fund operations and service debt obligations through equity offerings, debt financings, and strategic transactions[61] - The Company issued Tranche B Notes in October 2024, with an aggregate principal amount of $50.0 million, maturing two years from the issuance date[59] - The aggregate principal repayments for the Company's outstanding debt will be $46.3 million and $19.3 million in 2025 and 2026, respectively[132] Joint Ventures and Acquisitions - The Company formed a joint venture, Scilex Bio, Inc., with IPMC Company on April 17, 2025, to develop a next-generation reversible MAO-B Inhibitor[216] - The Company contributed 5.0 million shares of Semnur Common Stock for a 60% ownership interest in Scilex Bio, Inc.[216] - The Company acquired the SP-104 Assets in May 2022, with a potential Development Milestone Payment of $3.0 million upon FDA approval and a Sales Milestone Payment of $20.0 million based on future sales[63] Fair Value and Liabilities - The fair value of the Oramed Note was $15.0 million, up from $12.2 million as of December 31, 2024, reflecting a loss of $2.8 million in fair value change for the quarter[88] - The Tranche B Notes had a fair value of $24.5 million as of March 31, 2025, compared to $23.6 million at the end of 2024, with a loss of $2.5 million recorded for the three months ended March 31, 2025[89] - The aggregate fair value of the Purchased Revenue Liability was $7.3 million as of March 31, 2025, increasing from $6.8 million as of December 31, 2024, with a loss of $0.8 million for the quarter[90] Stock and Equity - The Company is authorized to issue 45,000,000 shares of Preferred Stock, with two series currently outstanding[162] - The Series 1 Preferred Stock dividend consists of an aggregate of 5,000,000 shares, with specific conditions for holders regarding distributions and voting rights[164] - The Company raised approximately $15 million from the April 2024 Registered Direct Offering by selling 428,572 shares of Common Stock at $35.00 per share[177] Management Discussion - The management discussion emphasizes the need to read financial results in conjunction with the unaudited condensed consolidated financial statements[218] - Forward-looking statements in the management discussion involve risks and uncertainties that could materially affect actual results[218] - The Company does not assume any obligation to update forward-looking statements except as required by law[218]