SCYNEXIS(SCYX) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Item 1. Financial Statements This section presents the unaudited condensed consolidated financial statements, including the balance sheets, statements of operations, and cash flows, along with detailed notes explaining the company's business, significant accounting policies, investments, accrued expenses, borrowings, stockholders' equity, stock-based compensation, fair value measurements, revenue recognition, and segment information Unaudited Condensed Consolidated Balance Sheets Unaudited Condensed Consolidated Balance Sheets (in thousands): | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Assets | | | | Cash and cash equivalents | $11,020 | $16,051 | | Short-term investments | $33,765 | $43,249 | | Total current assets | $56,498 | $72,181 | | Total assets | $60,694 | $90,643 | | Liabilities and Stockholders' Equity | | | | Accounts payable | $6,172 | $4,569 | | Accrued expenses | $2,477 | $3,793 | | Convertible debt | $— | $13,688 | | Total current liabilities | $10,863 | $24,099 | | Warrant liability | $2,904 | $7,998 | | Total liabilities | $16,227 | $35,566 | | Total stockholders' equity | $44,467 | $55,077 | | Total liabilities and stockholders' equity | $60,694 | $90,643 | Unaudited Condensed Consolidated Statements of Operations Unaudited Condensed Consolidated Statements of Operations (in thousands, except per share data): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | License agreement revenue | $1,364 | $736 | $1,620 | $2,109 | | Research and development | $7,141 | $6,807 | $12,282 | $14,019 | | Selling, general and administrative | $3,784 | $3,166 | $7,528 | $6,835 | | Total operating expenses | $10,925 | $9,973 | $19,810 | $20,854 | | Loss from operations | $(9,561) | $(9,237) | $(18,190) | $(18,745) | | Warrant liability fair value adjustment | $(2,166) | $5,761 | $(5,094) | $(3,848) | | Net loss | $(6,885) | $(14,458) | $(12,276) | $(14,047) | | Net loss per share – basic and diluted | $(0.14) | $(0.30) | $(0.25) | $(0.29) | Unaudited Condensed Consolidated Statements of Cash Flows Unaudited Condensed Consolidated Statements of Cash Flows (in thousands): | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(14,960) | $(14,867) | | Net cash provided by investing activities | $23,713 | $6,826 | | Net cash used in financing activities | $(14,084) | $(15) | | Net decrease in cash, cash equivalents, and restricted cash | $(5,331) | $(8,056) | | Cash, cash equivalents, and restricted cash at end of period | $11,264 | $26,537 | Notes to the Condensed Consolidated Financial Statements (unaudited) 1. Description of Business and Basis of Preparation SCYNEXIS, Inc. is a biotechnology company focused on developing innovative medicines for difficult-to-treat fungal infections, primarily through its proprietary fungerp platform. The company's lead product, ibrexafungerp (BREXAFEMME), is approved for vulvovaginal candidiasis. A significant development is the ongoing dispute with GSK regarding the MARIO study for invasive candidiasis, where GSK attempted to terminate the study despite the FDA lifting a clinical hold and the company resuming patient dosing, triggering a $10.0 million milestone payment. The company also faces liquidity challenges with an accumulated deficit and a Nasdaq minimum bid price notification - SCYNEXIS is a biotechnology company developing proprietary triterpenoid antifungal compounds ('fungerps') for difficult-to-treat and drug-resistant infections[17] - Ibrexafungerp (BREXAFEMME) was approved by the FDA in 2021 and 2022 for vulvovaginal candidiasis (VVC) and reduction in recurrent VVC[17] - The Phase 3 MARIO study for ibrexafungerp in invasive candidiasis resumed in May 2025 after the FDA lifted a clinical hold on April 24, 2025[19][22] - GSK notified the company of its intention to terminate the MARIO study on April 28, 2025, claiming no obligation for a $30.0 million development milestone. The company disputes GSK's unilateral termination right[20][21] - The company billed a $10.0 million development milestone to GSK in Q2 2025 due to the resumption of patient dosing in the MARIO study[22] - The company had an accumulated deficit of $388.8 million and capital resources of $46.5 million (cash, cash equivalents, and investments) as of June 30, 2025[24] - On June 20, 2025, the company received a Nasdaq notification for non-compliance with the $1.00 minimum bid price rule, with a compliance date of December 17, 2025[27][28] 2. Summary of Significant Accounting Policies This section outlines the company's accounting policies, including the calculation of basic and diluted net loss per share, and details the impact of recently adopted and issued accounting pronouncements, as well as newly enacted income tax legislation - Basic net loss per common share calculation includes outstanding prefunded warrants from April 2022 (7,516,267 shares) and December 2020 (3,200,000 shares) public offerings[33] Potentially Dilutive Shares Not Included in Diluted Net Loss Per Share (as of June 30): | Item | 2025 | 2024 | | :---------------------------------------------------- | :--------- | :--------- | | Outstanding stock options | 3,664,841 | 2,842,808 | | Outstanding restricted stock units | 3,139,084 | 3,263,345 | | Warrants to purchase common stock (April 2022 offering) | 15,000,000 | 15,000,000 | | Warrants to purchase common stock (loan agreement) | 198,811 | 198,811 | | Common stock (March 2019 Notes) | — | 1,138,200 | | Warrants to purchase common stock (Danforth) | 50,000 | 50,000 | | Total | 22,052,736 | 22,493,164 | - The company adopted ASU 2023-07 (Segment Reporting) in the prior annual reporting period and ASU 2023-09 (Income Taxes) is effective for annual periods beginning January 1, 2025, with no material impact expected[35][36] - ASU 2024-03 (Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures) is effective January 1, 2027, and its impact is currently being evaluated[37] - The One Big Beautiful Bill Act (OBBBA), enacted July 4, 2025, is not currently expected to materially impact the company's effective tax rate or cash flows in the current fiscal year[38] 3. Investments This note provides a summary of the company's investments, primarily in corporate and agency bonds, categorized by maturity. It details their amortized cost, unrealized gains/losses, and fair value, noting that fair values are determined using Level 2 inputs Summary of Investments (in thousands): | Category | June 30, 2025 Fair Value | December 31, 2024 Fair Value | | :----------------------- | :----------------------- | :----------------------- | | Short-term investments | $33,782 | $43,316 | | Long-term investments | $1,739 | $15,808 | | Total Fair Value | $35,521 | $59,124 | - Investments are carried at amortized cost, and their fair values are determined based on "Level 2" inputs[40] 4. Prepaid Expenses and Other Current Assets This note details the composition of prepaid expenses and other current assets, showing a decrease from December 31, 2024, to June 30, 2025, primarily driven by a reduction in prepaid research and development services Prepaid Expenses and Other Current Assets (in thousands): | Item | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Prepaid research and development services | $74 | $514 | | Prepaid insurance | $477 | $267 | | Other prepaid expenses | $160 | $169 | | Other current assets | $867 | $1,234 | | Total | $1,578 | $2,184 | 5. Accrued Expenses This note provides a breakdown of accrued expenses, indicating a decrease from December 31, 2024, to June 30, 2025, mainly due to lower accrued employee bonus compensation and research and development expenses Accrued Expenses (in thousands): | Item | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Accrued research and development expenses | $328 | $684 | | Accrued employee bonus compensation | $834 | $1,763 | | Other accrued expenses | $757 | $788 | | Accrued product recall | $558 | $558 | | Total | $2,477 | $3,793 | 6. Borrowings and Contingencies This note details the repayment of the March 2019 Senior Convertible Notes and provides updates on ongoing legal proceedings, including a securities class action and shareholder derivative complaints related to alleged misstatements about cross-contamination risks and internal controls - The $14.0 million principal amount of the March 2019 Senior Convertible Notes was fully repaid at maturity on March 15, 2025[44] - A securities class action lawsuit, filed November 7, 2023, alleges the company made misleading statements regarding cross-contamination risks in ibrexafungerp manufacturing and inadequate internal controls. The court granted the company's motion to dismiss with leave to amend on July 30, 2025[46] - Shareholder derivative complaints, filed May and June 2024, assert state and federal claims based on similar alleged misstatements as the class action. These cases are consolidated and stayed, with the company intending to vigorously defend them[47] 7. Stockholders' Equity This note provides a summary of common stock activity, including shares issued and outstanding, and a detailed table of shares reserved for future issuance under various plans and warrants Common Stock Issued and Outstanding: | Date | Shares Issued and Outstanding | | :---------------- | :---------------------------- | | June 30, 2025 | 39,174,941 | | December 31, 2024 | 37,973,991 | - In August 2025, a 5% beneficial owner exercised 2,750,000 prefunded warrants from the April 2022 public offering, resulting in the issuance of 2,750,000 common shares for $2,750[48] Common Shares Reserved for Future Issuance: | Item | June 30, 2025 | December 31, 2024 | | :---------------------------------------------------- | :------------ | :---------------- | | Outstanding stock options | 3,664,841 | 2,905,029 | | Outstanding restricted stock units | 3,139,084 | 3,120,374 | | Prefunded warrants (Dec 2020 offering) | 3,200,000 | 3,200,000 | | Warrants (April 2022 offering) | 15,000,000 | 15,000,000 | | Prefunded warrants (April 2022 offering) | 7,516,267 | 7,516,267 | | Warrants (loan agreement) | 198,811 | 198,811 | | Warrant (Danforth) | 50,000 | 50,000 | | March 2019 Notes conversion | — | 1,138,200 | | 2024 Plan | 3,903,934 | 5,864,196 | | Employee stock purchase plan | 1,399,683 | 1,431,393 | | 2015 Plan | 649,550 | 637,050 | | Total | 38,722,170 | 41,061,320 | 8. Stock-based Compensation This note outlines the company's equity incentive plans (2024 Plan, 2015 Plan), summarizes stock option and restricted stock unit (RSU) activity, and details the stock-based compensation expense recognized for the periods - The 2024 Equity Incentive Plan was adopted in April 2024 and became effective June 19, 2024, succeeding the 2014 Plan. As of June 30, 2025, 3,903,934 shares were available under the 2024 Plan[53] Restricted Stock Unit (RSU) Activity (Six Months Ended June 30, 2025): | Metric | Number of Shares | Weighted Average Grant Date Fair Value Per Share | | :-------------------------- | :--------------- | :--------------------------------------------- | | Non-vested at Dec 31, 2024 | 3,120,374 | $1.89 | | Granted | 1,485,949 | $1.05 | | Vested | (1,169,240) | $1.99 | | Forfeited | (297,999) | $1.78 | | Non-vested at June 30, 2025 | 3,139,084 | $1.46 | Stock-based Compensation Expense (in thousands): | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development | $202 | $216 | $417 | $411 | | Selling, general and administrative | $618 | $543 | $1,222 | $1,053 | | Total | $820 | $759 | $1,639 | $1,464 | 9. Fair Value Measurements This note details the fair value measurements of financial instruments, classifying cash and money market funds as Level 1 assets and the warrant liability as a Level 3 liability. It explains the use of the Black-Scholes model for valuing the warrant liability and provides a reconciliation of its changes Financial Instruments Measured at Fair Value (in thousands): | Item | June 30, 2025 Balance | December 31, 2024 Balance | | :------------------ | :-------------------- | :-------------------- | | Cash | $448 | $3,441 | | Restricted cash | $244 | $544 | | Money market funds | $10,572 | $12,610 | | Total Level 1 Assets | $11,264 | $16,595 | | Warrant liability | $2,904 | $7,998 | | Total Level 3 Liabilities | $2,904 | $7,998 | - The warrant liability is a Level 3 financial liability, valued using the Black-Scholes option valuation model, incorporating unobservable inputs like volatility (85.4% at June 30, 2025, and 83.4% at December 31, 2024)[59] Reconciliation of Level 3 Warrant Liabilities (in thousands): | Metric | Amount | | :-------------------------- | :----- | | Balance – December 31, 2024 | $7,998 | | Gain adjustment to fair value | $(5,094) | | Balance – June 30, 2025 | $2,904 | 10. Revenue This note details revenue recognition primarily from the GSK License Agreement, including the $10.0 million license agreement receivable associated with the MARIO study milestone. It also highlights the potential impact on financial statements if the dispute with GSK is not resolved favorably - Revenue is primarily derived from the GSK License Agreement, which grants GSK exclusive rights for ibrexafungerp in the GSK Territory[61][62] - As of June 30, 2025, the company maintains a $10.0 million license agreement receivable from GSK, triggered by the resumption of patient dosing in the Phase 3 MARIO study[63] - If the disagreement with GSK over the MARIO study is not resolved favorably, the company may need to reverse the $10.0 million receivable and recognize remaining deferred revenue, materially impacting financial statements[63] License Agreement Revenue (in thousands): | Period | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Three Months Ended June 30, | $1,364 | $736 | | Six Months Ended June 30, | $1,620 | $2,109 | Deferred Revenue (in thousands): | Category | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Current portion | $1,770 | $1,642 | | Long-term portion | $515 | $1,294 | 11. Segments The company operates as a single reportable segment focused on drug development, with the CEO serving as the chief operating decision maker. Performance is assessed based on consolidated net loss, and resources are allocated to drug development programs accordingly - The company has one reportable segment: drug development, managing business activities on a consolidated basis[66] - The Chief Executive Officer (CEO) is the chief operating decision maker (CODM), assessing performance and allocating resources based on consolidated net (loss) income[66] Drug Development Segment Net Loss (in thousands): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $1,364 | $736 | $1,620 | $2,109 | | Clinical expense | $2,506 | $2,274 | $4,217 | $4,762 | | Preclinical expense | $1,032 | $646 | $1,969 | $1,181 | | Chemistry, manufacturing, and controls | $1,771 | $1,484 | $2,273 | $3,580 | | Selling, general, and administrative | $3,784 | $3,166 | $7,528 | $6,835 | | Segment net loss | $(6,885) | $(14,458) | $(12,276) | $(14,047) | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the company's financial condition and operational results, including an overview of its drug development pipeline, detailed updates on the MARIO study and SCY-247 development, and discussions on liquidity, legal proceedings, and Nasdaq listing compliance. It also breaks down the components of operating results and analyzes financial performance for the three and six months ended June 30, 2025 and 2024 Overview - SCYNEXIS, Inc. is a biotechnology company focused on developing novel antifungal agents (fungerps) to combat difficult-to-treat and drug-resistant infections[70] - Ibrexafungerp (BREXAFEMME) is the first approved fungerp for vulvovaginal candidiasis, and a second-generation fungerp, SCY-247, is currently in clinical trials[71][72] MARIO Study and Clinical Hold Update - The Phase 3 MARIO study for ibrexafungerp was placed on clinical hold in September 2023 due to potential cross-contamination at the drug substance manufacturer's facility[74] - The FDA lifted the clinical hold on ibrexafungerp on April 24, 2025, allowing the MARIO study to resume[75] - GSK notified the company of its intent to terminate the MARIO study on April 28, 2025, disputing obligations for a $30.0 million development milestone. The company believes GSK does not have a unilateral termination right[75][76][77] - Patient dosing in the MARIO study resumed in May 2025, triggering a $10.0 million development milestone billed to GSK[78] - The September 2023 cross-contamination issue also led to a recall of all commercial BREXAFEMME supplies, with GSK responsible for manufacturing new supplies and reintroduction to the market[79] SCY-247 Development Update - The company completed the single and multiple ascending dose portions of its Phase 1 study of oral SCY-247 in 88 healthy subjects[81] - Data from the SCY-247 Phase 1 study (safety, tolerability, and pharmacokinetics) is expected to be released in the third quarter of 2025[81] Nasdaq Minimum Bid Price Notification - On June 20, 2025, the company received a Nasdaq notification for failing to meet the $1.00 minimum bid price requirement for 30 consecutive business days[82] - The company has 180 calendar days, until December 17, 2025, to regain compliance by having its common stock close at $1.00 or more for at least 10 consecutive business days[83] Class Action Lawsuit - A securities class action was filed on November 7, 2023, alleging misleading statements regarding cross-contamination risks in ibrexafungerp manufacturing and inadequate internal controls. The motion to dismiss was granted with leave to amend on July 30, 2025[84] - Shareholder derivative complaints, filed in May and June 2024, assert similar claims against the company's directors and officers; these cases are consolidated and stayed[85] Liquidity - As of June 30, 2025, the company's principal source of liquidity was cash, cash equivalents, and investments totaling $46.5 million[86] - The company had an accumulated deficit of $388.8 million as of June 30, 2025, and expects to incur significant R&D and SG&A expenses, necessitating additional capital[87] - Future funding may be obtained through equity offerings, debt financings, non-dilutive third-party funding, strategic alliances, or licensing/collaboration arrangements[87] Collaborations and Licensing Agreements - Key licensing agreements include: GSK (ibrexafungerp development, manufacture, commercialization), Merck (ibrexafungerp rights, milestones, royalties), Hansoh (ibrexafungerp in Greater China, Chinese VVC approval, milestones, ~10% royalties), R-Pharm (ibrexafungerp in Russia/non-core markets), Waterstone (SCY-635 for viral diseases), and Cypralis (cyclophilin inhibitor assets, milestones, royalties)[88] Components of Operating Results Revenue - Revenue consists of license agreement revenue associated with GSK[89] Research and Development Expense - R&D expenses include costs for preclinical/clinical trials, drug formulation, manufacturing, regulatory filings, salaries, and medical affairs. Ibrexafungerp and SCY-247 were the only key R&D projects[90][91] Selling, General and Administrative Expense - SG&A expenses primarily consist of salaries, personnel-related costs, facility costs, professional fees (accounting, legal), consulting, patent fees, information systems, and marketing[93] Other Expense (Income) - Other expense (income) includes amortization of debt issuance costs and discount, interest income, interest expense, warrant liability fair value adjustment, and derivative liability fair value adjustment[94] Income Tax Expense - Income tax expense for the six months ended June 30, 2024, primarily consisted of U.S. federal income tax[95] Results of Operations for the Three Months Ended June 30, 2025 and 2024 Results of Operations (Three Months Ended June 30, in thousands): | Metric | 2025 | 2024 | Change ($) | Change (%) | | :------------------------------------------ | :----- | :----- | :--------- | :--------- | | License agreement revenue | $1,364 | $736 | $628 | 85.3% | | Research and development | $7,141 | $6,807 | $334 | 4.9% | | Selling, general and administrative | $3,784 | $3,166 | $618 | 19.5% | | Total operating expenses | $10,925 | $9,973 | $952 | 9.5% | | Loss from operations | $(9,561) | $(9,237) | $(324) | 3.5% | | Amortization of debt issuance costs and discount | $— | $421 | $(421) | (100.0)% | | Interest income | $(510) | $(1,130) | $620 | (54.9)% | | Interest expense | $— | $197 | $(197) | (100.0)% | | Warrant liability fair value adjustment | $(2,166) | $5,761 | $(7,927) | (137.6)% | | Derivative liability fair value adjustment | $— | $(28) | $28 | (100.0)% | | Total other (income) expense | $(2,676) | $5,221 | $(7,897) | (151.3)% | | Net loss | $(6,885) | $(14,458) | $7,573 | (52.4)% | - Research and development expenses increased by $0.3 million (5%) due to increases in CMC ($0.3M) and preclinical ($0.4M) expenses, partially offset by decreases in salary and other R&D expenses[97][99] - Selling, general and administrative expenses increased by $0.6 million (20%) primarily due to a $0.4 million increase in professional fees[100] - A $2.2 million gain on warrant liability fair value adjustment was recognized in Q2 2025, compared to a $5.8 million loss in Q2 2024, primarily due to a decrease in the company's stock price[103] Results of Operations for the Six Months Ended June 30, 2025 and 2024 Results of Operations (Six Months Ended June 30, in thousands): | Metric | 2025 | 2024 | Change ($) | Change (%) | | :------------------------------------------ | :----- | :----- | :--------- | :--------- | | License agreement revenue | $1,620 | $2,109 | $(489) | (23.2)% | | Research and development | $12,282 | $14,019 | $(1,737) | (12.4)% | | Selling, general and administrative | $7,528 | $6,835 | $693 | 10.1% | | Total operating expenses | $19,810 | $20,854 | $(1,044) | (5.0)% | | Loss from operations | $(18,190) | $(18,745) | $555 | (3.0)% | | Amortization of debt issuance costs and discount | $312 | $822 | $(510) | (62.0)% | | Interest income | $(1,305) | $(2,402) | $1,097 | (45.7)% | | Interest expense | $173 | $403 | $(230) | (57.1)% | | Warrant liabilities fair value adjustment | $(5,094) | $(3,848) | $(1,246) | 32.4% | | Derivative liabilities fair value adjustment | $— | $(196) | $196 | (100.0)% | | Total other income | $(5,914) | $(5,221) | $(693) | 13.3% | | Loss before taxes | $(12,276) | $(13,524) | $1,248 | (9.2)% | | Income tax expense | $— | $523 | $(523) | (100.0)% | | Net loss | $(12,276) | $(14,047) | $1,771 | (12.6)% | - Research and development expenses decreased by $1.7 million (12%) primarily due to a $1.3 million decrease in CMC expense and a $0.5 million decrease in clinical expense, partially offset by an $0.8 million increase in preclinical expense[106][107][108] - Selling, general and administrative expenses increased by $0.7 million (10%) due to increases in business development expense ($0.3M) and salary expense ($0.3M)[109] - A $5.1 million gain on warrant liabilities fair value adjustment was recognized in H1 2025, compared to a $3.8 million gain in H1 2024, primarily due to a decrease in the company's stock price[112] Liquidity and Capital Resources Sources of Liquidity - As of June 30, 2025, the company had $46.5 million in cash, cash equivalents, and investments, down from $75.1 million at December 31, 2024[114] - The company believes its capital resources are sufficient for at least 12 months but anticipates needing additional capital due to significant R&D and SG&A expenses[114][115] Cash Flows Cash Flows (Six Months Ended June 30, in thousands): | Activity | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Net cash used in operating activities | $(14,960) | $(14,867) | | Net cash provided by investing activities | $23,713 | $6,826 | | Net cash used in financing activities | $(14,084) | $(15) | | Net decrease in cash, cash equivalents, and restricted cash | $(5,331) | $(8,056) | - Net cash used in operating activities increased slightly by $0.1 million in H1 2025 compared to H1 2024, primarily due to continued development costs for SCY-247 and ibrexafungerp[118] - Net cash provided by investing activities significantly increased to $23.7 million in H1 2025 from $6.8 million in H1 2024, driven by maturities of investments[121] - Net cash used in financing activities increased substantially to $14.1 million in H1 2025, primarily due to the $14.0 million repayment of convertible debt[122] Future Funding Requirements - The company anticipates substantial additional funding will be required for ongoing operations, particularly for research, development, and clinical trials of product candidates[123] - Future capital requirements depend on factors such as the success of the GSK License Agreement, clinical development progress of SCY-247 and ibrexafungerp, regulatory approvals, intellectual property, and strategic alliances[125][128] - Funding strategies include equity offerings (potentially dilutive), debt financings (with covenants), non-dilutive third-party funding, and strategic alliances/licensing arrangements (potentially relinquishing rights)[125] Significant Estimates and Judgments - The preparation of financial statements requires management to make estimates and assumptions affecting reported asset/liability amounts and revenue/expense disclosures, which are evaluated on an ongoing basis[126] Item 3. Quantitative and Qualitative Disclosures About Market Risk This section states that quantitative and qualitative disclosures about market risk are not applicable to smaller reporting companies - This item is not applicable to smaller reporting companies[129] Item 4. Controls and Procedures This section confirms management's evaluation of the effectiveness of the company's disclosure controls and procedures, concluding they were effective as of June 30, 2025. It also states that there have been no material changes in internal control over financial reporting during the quarter Management's Evaluation of our Disclosure Controls and Procedures - As of June 30, 2025, management, with the participation of the principal executive and financial officers, concluded that the company's disclosure controls and procedures were effective at the reasonable assurance level[131] Changes in Internal Control Over Financial Reporting - During the three months ended June 30, 2025, there were no changes in internal control over financial reporting that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[132] PART II. OTHER INFORMATION Item 1. Legal Proceedings This section provides an update on the legal proceedings, including a securities class action and shareholder derivative complaints, both alleging misstatements regarding cross-contamination risks and internal controls. The company intends to vigorously defend these litigations - A securities class action, filed November 7, 2023, alleges misleading statements about ibrexafungerp manufacturing and internal controls. The court granted the company's motion to dismiss with leave to amend on July 30, 2025[134] - Shareholder derivative complaints, filed May and June 2024, assert similar claims against directors and officers, are consolidated, and currently stayed. The company disagrees with the allegations and intends to defend vigorously[135] Item 1A. Risk Factors This section highlights the risk of the company's common stock being delisted from the Nasdaq Global Market due to non-compliance with the minimum $1.00 bid price requirement. The company received a deficiency notice and has until December 17, 2025, to regain compliance - The company received a Nasdaq notification on June 20, 2025, for failing to maintain a minimum closing bid price of $1.00 per share for 30 consecutive business days[138] - The compliance date to regain the $1.00 minimum bid price is December 17, 2025. Failure to comply could lead to delisting or transfer to the Nasdaq Capital Market, potentially requiring a reverse stock split[139][140] Item 6. Exhibits This section lists the exhibits filed as part of the Form 10-Q, including organizational documents, certifications, and XBRL data files - Exhibits include Amended and Restated Certificate of Incorporation, By-Laws, Certifications of CEO and CFO (31.1, 31.2, 32.1**), Inline XBRL Instance Document, and Cover Page Interactive Data File[143] Signatures This section contains the official signatures of the Chief Executive Officer and Chief Financial Officer, certifying the report on behalf of SCYNEXIS, Inc - The report is signed by David Angulo, M.D., Chief Executive Officer, and Ivor Macleod, Chief Financial Officer, on August 12, 2025[148]