SCYNEXIS(SCYX) - 2025 Q1 - Quarterly Report

PART I FINANCIAL INFORMATION Financial Statements SCYNEXIS reported a net loss of $5.39 million in Q1 2025, a reversal from prior year net income, with license revenue decreasing to $0.26 million and cash balances reducing to $53.8 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $6,942 | $16,051 | | Total current assets | $52,221 | $72,181 | | Total assets | $67,915 | $90,643 | | Total current liabilities | $8,957 | $24,099 | | Convertible debt | $0 | $13,688 | | Total liabilities | $17,383 | $35,566 | | Total stockholders' equity | $50,532 | $55,077 | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Account | Three Months Ended March 31, 2025 (in thousands, except per share data) | Three Months Ended March 31, 2024 (in thousands, except per share data) | | :--- | :--- | :--- | | License agreement revenue | $257 | $1,373 | | Research and development | $5,141 | $7,212 | | Total operating expenses | $8,867 | $10,881 | | Loss from operations | ($8,610) | ($9,508) | | Net (loss) income | ($5,391) | $411 | | Net (loss) income per share – basic | ($0.11) | $0.01 | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Account | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | ($7,465) | ($4,007) | | Net cash provided by investing activities | $12,440 | $5,454 | | Net cash used in financing activities | ($14,084) | ($15) | | Net (decrease) increase in cash | ($9,109) | $1,432 | Notes to the Condensed Consolidated Financial Statements Key notes include a dispute with GSK over the MARIO study, jeopardizing a $30 million milestone and $9.5 million contract asset, the $14.0 million repayment of convertible debt, and an ongoing securities class action lawsuit - The FDA lifted the clinical hold on the Phase 3 MARIO study on April 24, 2025, but GSK subsequently notified the company of its intent to terminate the study, which SCYNEXIS disputes[20] - The dispute with GSK over the MARIO study could jeopardize $30.0 million in development milestones and potentially reverse a $9.5 million contract asset[20][56] - The company repaid $14.0 million of its 6.0% Senior Convertible Notes upon maturity on March 15, 2025[40] - A securities class action lawsuit was filed alleging materially false statements regarding cross-contamination risks in ibrexafungerp manufacturing, which the company intends to vigorously defend[42] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the ongoing GSK dispute regarding the MARIO study, a 29% decrease in R&D expenses to $5.1 million, a net loss of $5.4 million, and $53.8 million in cash, sufficient for at least 12 months of operations Overview and MARIO Study Update The company is reinitiating its Phase 3 MARIO study for ibrexafungerp, despite GSK's disputed termination notice, aiming to dose the first patient by June 26, 2025, following the FDA's lifted clinical hold - The FDA lifted the clinical hold on the MARIO study on April 24, 2025[69] - GSK notified SCYNEXIS of its intent to terminate the MARIO study on April 28, 2025, claiming no obligation for $30.0 million in development milestones[69] - SCYNEXIS disputes GSK's termination right and is reinitiating the study, targeting the first new patient dose by June 26, 2025[72] Results of Operations Q1 2025 saw license revenue drop to $0.3 million, R&D expenses decrease 28.7% to $5.1 million, and a net loss of $5.4 million due to lower revenue and a smaller warrant liability gain Results of Operations Comparison (in thousands) | Account | Q1 2025 (in thousands) | Q1 2024 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | License agreement revenue | $257 | $1,373 | (81.3)% | | Research and development | $5,141 | $7,212 | (28.7)% | | Selling, general and administrative | $3,726 | $3,669 | 1.6% | | Net (loss) income | ($5,391) | $411 | (1,411.7)% | - The $2.1 million decrease in R&D expenses was primarily due to a $1.6 million reduction in chemistry, manufacturing, and controls (CMC) expense and a $0.8 million decrease in clinical expense[88] - A $2.9 million gain on warrant liabilities fair value adjustment was recognized in Q1 2025, lower than the $9.6 million gain in Q1 2024, primarily due to a decreased stock price[93] Liquidity and Capital Resources As of March 31, 2025, the company held $53.8 million in cash and investments, deemed sufficient for at least 12 months, with $7.5 million used in operations and $14.0 million for debt repayment - The company's cash, cash equivalents, and investments totaled $53.8 million as of March 31, 2025[95] - Management believes current capital resources are sufficient to fund operations for at least 12 months from the financial statements' issuance[95] - Net cash used in financing activities was $14.1 million for Q1 2025, primarily due to the $14.0 million repayment of convertible debt[103] Quantitative and Qualitative Disclosures About Market Risk This section is not applicable as the company qualifies as a smaller reporting company - This section is not applicable as the company qualifies as a smaller reporting company[110] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Management concluded that disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2025[112] - No material changes were made to internal control over financial reporting during the three months ended March 31, 2025[113] PART II OTHER INFORMATION Legal Proceedings The company faces a securities class action lawsuit filed November 7, 2023, alleging false statements regarding ibrexafungerp manufacturing cross-contamination risks, which it intends to vigorously defend - A securities class action lawsuit was filed against the company and executives on November 7, 2023[115] - Allegations claim undisclosed cross-contamination risks for ibrexafungerp manufacturing due to shared equipment and ineffective internal controls[115] - The company has filed a motion to dismiss and intends to vigorously defend the litigation[115] Risk Factors This section refers to the detailed risk factors outlined in the company's Annual Report on Form 10-K for the year ended December 31, 2024, with no new updates in this quarterly report - The company's risk factors are detailed in its Annual Report on Form 10-K for the year ended December 31, 2024[116] Exhibits This section lists exhibits filed with the quarterly report, including CEO and CFO certifications and Inline XBRL financial data documents - The report includes CEO and CFO certifications as required by Rule 13a-14(a) and Section 1350 of the Sarbanes-Oxley Act[117][118]