KALA BIO, Inc.
For the period ended Sep 30, 2025. Filed Nov 19, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 19, 2025
KALA$0.16+2.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-08.
0001558370-25-010853
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-19.
0001104659-25-113927
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 119 previous paragraphs and 155 current paragraphs.
60 unchanged; 45 reworded; 43 added; 6 removed; 8 previous and 7 current paragraphs rearranged.
Tables are not compared: 33 previous and 29 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (43)
Current report
Recent Developments
Current report
CHASE Trial
Current report
In February 2023, we dosed our first patient in our CHASE (Corneal Healing After SEcretome therapy) Phase 2b clinical trial of KPI-012 for persistent corneal epithelial defect, or PCED, a rare disease of impaired corneal dealing, in the United States, or the CHASE (CornealHealing AfterSEcretome therapy) trial. On September 29, 2025, we announced that the CHASE trial of KPI-012 for the treatment of PCED did not meet the primary endpoint of complete healing of PCED as measured by corneal fluorescein staining. The CHASE trial also failed to achieve statistical significance for key secondary efficacy endpoints and did not show any meaningful difference between either KPI-012 treatment arm and the placebo arm. Based on the CHASE trial results, we determined to cease development of KPI-012 and our MSC-S platform. In connection with such decision, we approved a reduction in our workforce by approximately 19 employees, or approximately 51%. During the three months ended September 30, 2025, we incurred costs of approximately $0.4 million related to this reduction in workforce, primarily consisting of severance payments and employee benefit costs. Additional costs related to the reduction in workforce are expected to be substantially incurred in the fourth quarter of 2025.
Current report
Oxford Foreclosure and Workforce Terminations
Current report
On September 29, 2025, we received a written notice, or the Default Notice, of event of default from Oxford Finance LLC, or Oxford Finance, with respect to that certain Loan and Security Agreement, dated as of May 4, 2021, by and among us, Combangio and Oxford Finance, as lender and collateral agent, as amended, which we refer to as the Loan Agreement. The Loan Agreement provides under Section 8.3 that “events of default” include: (i) a material impairment in the perfection or priority of lien in the collateral or in the value of such collateral; (ii) a material adverse change in our business, operations or condition (financial or otherwise); or (iii) a material impairment of the prospect of repayment of any portion of the obligations under the Loan Agreement (each, a “Material Adverse Change”). The Default Notice asserted that an event of default, or the Event of Default, had occurred and was continuing under Section 8.3 (Material Adverse Change) of the Loan Agreement and alleged that other events of default under the Loan Agreement may exist. In the Default Notice, Oxford Finance declared by reason of the Event of Default, that all of our obligations under the Loan Agreement were immediately due and payable. In addition, the Default Notice indicated that our obligations under the Loan Agreement began accruing interest at the Default Rate (as defined in the Loan Agreement) effective immediately upon occurrence of the Event of Default. The total amount of our obligations under the Loan Agreement as of the date of the Default Notice that were accelerated and declared payable by Oxford Finance was $29.1 million, plus any additional interest due upon final payment and any expenses that become payable by us under the Loan Agreement.
Current report
On October 2, 2025, we entered into retention agreements which we refer to as Retention Agreements, with Todd Bazemore, our then President and Chief Executive Officer, Mary Reumuth, our Chief Financial Officer, and Kim Brazzell, Ph.D., our then Head of Research and Development and Chief Medical Officer. The Retention Agreements entitled Mr. Bazemore, Ms. Reumuth and Dr. Brazzell to receive retention payments, or Retention Payments, of $183,750, $136,250, and $145,000, respectively. Each of the Retention Agreements provides that if, prior to December 31, 2025, such executive’s employment is terminated voluntarily by such executive or by us for cause (as defined in the applicable executive’s employment agreement), then, pursuant to the terms of the Retention Agreement, such executive shall, upon request, repay the gross amount of the Retention Payment to us.
Current report
On October 18, 2025, pursuant to the terms of the Loan Agreement, Oxford Finance informed us that it intended to foreclose on all of our remaining assets and that Oxford Finance would not consent to our use of cash for any reason other than for minimal payroll expenses pending Oxford Finance’s foreclosure of our assets. In addition, Oxford has swept substantially all of our cash resources from our bank accounts.
Current report
As a result, on October 19, 2025, we terminated all remaining employees not deemed necessary by Oxford Finance to execute a foreclosure of our assets. On October 19, 2025, in connection with this reduction, we terminated without cause the employment of Todd Bazemore, our President and Chief Executive Officer, effective immediately. Mr. Bazemore continues to serve as our principal executive officer, pursuant to the terms of a consulting agreement. In connection with the workforce reductions that were announced in September 2025 and October 2025, we incurred costs of approximately $1.6 million, of which approximately $0.4 million were incurred in the third quarter of 2025 with the remainder was incurred and will be incurred in the fourth quarter of 2025.
Current report
On November 3, 2025, Oxford Finance informed us that it intended to pause its foreclosure of our assets and permitted us to use $125,000 of cash it previously swept to fund the negotiation and execution of the Convertible Loan Agreement (as defined below) and to fund preliminary preparation work on this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025.
Current report
After applying the swept cash to Oxford Finance’s secured debt claims, the total amount of our obligations under the Loan Agreement that have been accelerated and declared payable by Oxford Finance is approximately $9.6 million, plus any additional interest due upon final payment and any expenses that become payable by us under the Loan Agreement.
Current report
On November 9, 2025, we entered into a Convertible Loan Agreement, or the Convertible Loan Agreement with an individual lender, or the Individual Lender, pursuant to which the Individual Lender provided us a convertible loan in the aggregate amount of $375,000 (the “Loan Principal”). The sole purpose of the funds from the Individual Lender is to facilitate the negotiation and finalization of a potential additional financing transaction with the Individual Lender and for preparing and filing this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025.
Current report
The Loan Principal will bear simple interest at a rate equal to 15% per annum, which we refer to as the “Interest”, and together with the Loan Principal, the “Loan Amount”, commencing on the date we receive the applicable portion of the Loan Principal and until full repayment thereof in accordance with the terms of the Convertible Loan Agreement. The applicable Interest is required to be paid by us on a monthly basis by no later than the 15th day of each calendar month starting in December 2025. The Loan Principal will become due and payable by us to the Individual Lender on the first anniversary of receiving the Loan Principal (the “Maturity Date”). We may extend the Maturity Date for one year by providing written notice to the Individual Lender up to two months prior to the Maturity Date, subject to specified conditions. We are also required to make certain prepayments to the Individual Lender upon the occurrence of specified events.
Current report
Subject to compliance with the rules and regulations of The Nasdaq Stock Market, at any time prior to the full repayment of the Loan Amount to the Individual Lender, the Individual Lender will have the right, upon prior written notice to us, to convert all or any of the then outstanding and unpaid portion of the Loan Amount into shares, or the Conversion Shares, of our common stock at the conversion prices specified in the Convertible Loan Agreement. In addition, if we enter into a definitive agreement to consummate an M&A Transaction (as defined in the Convertible Loan Agreement) or an underwritten public offering (a “Public Offering” and together with an M&A Transaction, a “Liquidity Event”), and if the Loan Amount has not previously converted or been repaid pursuant to the Convertible Loan Agreement, the Individual Lender will have the right to elect to (i) convert the entire Loan Amount into the most senior class of shares issued us immediately prior to the closing of the Liquidity Event or (ii) have the entire Loan Amount repaid in cash.
Current report
We may repay the outstanding Loan Amount in part or in full, at any time, with no prepayment penalty. We will provide the Individual Lender with three business days prior written notice of the repayment, during which time the Individual Lender may elect to convert any or all of the outstanding Loan Amount into Conversion Shares in accordance with the Convertible Loan Agreement.
Current report
The Loan Amount will become due and payable in cash by us upon the occurrence, prior to the Maturity Date, of certain specified events of defaults, including, but not limited to, (i) our liquidation, dissolution or winding up, (ii) the filing by us of any petition or action for relief under any bankruptcy, reorganization, insolvency or moratorium law, (iii) breach by us of any material undertaking or obligation under any financing agreement or credit facility (other than the Loan Agreement with Oxford Finance) occurring after November 9, 2025 and (iv) failure by us to fully or timely discharge our duties or obligations under the Loan Agreement, subject to certain exceptions.
Current report
Our Current Strategy and Focus
Current report
Subject to consummation of an additional financing transaction with the Individual Lender or another third-party, we plan to continue to comply with our filing obligations under the Securities Exchange Act of 1934, as amended, and resume our exploration of strategic options, which may include a sale, license, merger or other monetization of remaining assets, the seeking of additional financing or, subject to the availability of additional funding, the resumption of certain research and development activities. Any future resumption of our historical research and development activities would depend on completing a strategic transaction that would support our prior operating plans or otherwise obtaining significant additional funding. If we are able to obtain significant additional funding, we plan to conduct preclinical testing focused on identifying the optimal dose of KPI-012 and the most relevant ocular disease(s) or indication(s) to pursue utilizing existing preclinical pharmacology and safety models. We believe that these results along with the manufacturing and analytical data from the previously conducted KPI-012 development activities may lead to the identification of a candidate for further clinical development. Additionally, if we were able to obtain significant additional funding, we plan to resume our preclinical studies of KPI-014 to evaluate the utility of our MSC-S platform for inherited retinal degenerative diseases, such as Retinitis Pigmentosa and Stargardt Disease.
Current report
We have engaged a financial advisor to advise on the exploration of strategic options. There can be no assurance that such exploration of strategic options will result in us pursuing a transaction or obtaining additional financing or that any such transaction or financing will be completed, nor as to the terms on which any such transaction or financing will occur, if at all. If we do not enter into any such transaction or financing prior to the utilization of the proceeds of the Convertible Loan Agreement, we expect that Oxford Finance will resume its efforts to foreclose on our assets.
Current report
Our board of directors may decide that it is in the best interests of its stockholders to commence bankruptcy or insolvency proceedings. It is highly unlikely that there will be cash available for distribution to our stockholders and we cannot assure you as to the amount or timing if distributions, if any.
Current report
Financial Operations
Current report
●facilities, depreciation and other expenses, which include direct and allocated expenses for rent and maintenance of facilities and supplies.
Current report
We expect that our research and development costs for 2025 will decrease compared to such expenses for the year ended December 31, 2024. Our research and development costs began to decrease significantly as a result of our recent determination to cease research and development activities. If we were able to resume research and development activities, we expect that our research and development costs would increase as we conduct any necessary preclinical studies, clinical trials and other development activities for KPI-012, KPI-014 or any other product candidate we may develop in the future. Any future resumption of our historical research and development activities would depend on completing a strategic transaction that would support our prior operating plans or otherwise obtaining significant additional funding.
Current report
September 2025, Combangio received an additional disbursement of $2.3 million and $0.5 million, respectively, from CIRM upon the achievement of a specified milestone.
Current report
(Gain) Loss on fair value remeasurement of contingent consideration
Current report
Impairment of right-of-use assets
Current report
Impairment of right-of-use assets for the three months ended September 30, 2025 was $1.4 million of expense related to the impairment of the right-of-use asset related to our Menlo Park lease.
Current report
Other expense, net
Current report
Other expense, net for the three months ended September 30, 2025 was a $0.1 million write-off of receivables we determined to be uncollectible.
Current report
Comparison of the Nine Months Ended September 30, 2025 and 2024
Current report
(Gain) loss on fair value remeasurement of contingent consideration
Current report
Gain on fair value remeasurement of contingent consideration for the nine months ended September 30, 2025 was $4.7 million as compared to a loss of $0.5 million during the nine months ended September 30, 2024, primarily due to the determination to cease developmentof KPI-012.
Current report
Impairment of right-of-use assets
Current report
Impairment of right-of-use assets for the nine months ended September 30, 2025 was $1.4 million of expense related to the impairment of the right-of-use asset related to our Menlo Park lease.
Current report
Other expense, net
Current report
Other expense, net for the nine months ended September 30, 2025 was a $0.1 million write-off of receivables we determined to be uncollectible.
Current report
On September 29, 2025, we received the Default Notice, of event of default from Oxford Finance, with respect to that certain Loan Agreement. The Default Notice asserted that an Event of Default had occurred and was continuing under Section 8.3 (Material Adverse Change) of the Loan Agreement and alleged that other events of default under the Loan Agreement may exist. In the Default Notice, Oxford Finance declared by reason of the Event of Default, that all of our obligations under the Loan Agreement were immediately due and payable. In addition, the Default Notice indicated that our obligations under the Loan Agreement began accruing interest at the Default Rate (as defined in the Loan Agreement) effective immediately upon occurrence of the Event of Default. The total amount of our obligations under the Loan Agreement as of the date of the Default Notice that were accelerated and declared payable by Oxford Finance was $29.1 million, plus any additional interest due upon final payment and any expenses that become payable by us under the Loan Agreement.
Current report
On October 19, 2025, pursuant to the terms of the Loan Agreement, Oxford Finance informed us that it intended to foreclose on all of our remaining assets and that Oxford Finance would not consent to the Company’s use of cash for any reason other than for minimal payroll and related expenses pending Oxford Finance’s foreclosure of the Company’s assets. Oxford then swept substantially all of our cash resources from our bank accounts. On November 3, 2025, Oxford Finance informed us that it intended to pause its foreclosure of the Company’s assets and permitted us to
Current report
use $125,000 of cash it previously swept to fund the negotiation and execution of the Convertible Loan Agreement and to fund preliminary preparation work on this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025.
Current report
On November 9, 2025, we entered into a Convertible Loan Agreement with the Individual Lender, pursuant to which the Individual Lender provided us a convertible loan in the aggregate amount of up to $375,000. The sole purpose of the funds from the Individual Lender is to facilitate the negotiation and finalization of a potential additional financing transaction with the Individual Lender and for preparing and filing this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025.
Current report
We expect that our cash and cash equivalents as of September 30, 2025, will not be sufficient to fund our operating expenses, lease and debt service obligations and capital expenditure requirements through November 2025. On October 19, 2025, pursuant to the terms of the Loan Agreement, Oxford Finance informed us that it intended to foreclose on all of our remaining assets and that Oxford Finance would not consent to the Company’s use of cash for any reason other than for minimal payroll and related expenses pending Oxford Finance’s foreclosure of the Company’s assets. Oxford then swept substantially all of our cash resources from its bank accounts. On November 3, 2025, Oxford Finance informed us that it intended to pause its foreclosure of the Company’s assets and permitted us to use $125,000 of cash it previously swept to fund the negotiation and execution of the Convertible Loan Agreement and to fund preliminary preparation work on this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025. In addition, since these amounts are not expected to be sufficient to fund our operations for at least twelve months from the date of issuance of the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q, there is substantial doubt about our ability to continue as a going concern.
Showing the first 40 of 43 passages. Open the source sections for the rest.
Removed paragraphs (6)
Previous report
The CHASE trial is comprised of two patient cohorts. On March 27, 2023, we announced positive safety data from the first cohort of the CHASE trial, which is an open-label study to evaluate the safety of the high dose of KPI-012 ophthalmic solution (3 U/mL) dosed topically four times per day, or QID, in two patients. Both patients in the first cohort successfully completed eight weeks of dosing with no safety issues observed. In July 2025, we completed patient enrollment in the second and final patient cohort of the CHASE trial, which is a multicenter, randomized, double-masked, vehicle-controlled, parallel-group trial to evaluate the safety and efficacy of two doses of KPI-012 ophthalmic solution (3 U/mL and 1 U/mL) versus vehicle dosed topically QID for 56 days. The CHASE trial randomized 79 patients across 37 sites in the United States and Latin America with verified PCEDs at baseline that will be eligible for inclusion in the primary efficacy analysis.
Previous report
The primary endpoint of the CHASE trial is the complete healing of the PCED as measured by corneal fluorescein staining photographs analyzed by a masked central reading center. We expect to report topline safety and efficacy data from the CHASE trial at the end of September 2025. Contingent on positive results and subject to discussion with regulatory authorities, we believe the CHASE trial could potentially serve as a pivotal trial required to support the submission of a Biologics License Application, or BLA, for KPI-012 to the FDA.
Previous report
KPI-012 has received Orphan Drug and Fast Track designations from the FDA for the treatment of PCED.
Previous report
obligated to pay a 1.0% royalty on net sales of any CIRM-funded invention in excess of $500 million per year until the last to expire patent covering such invention expires.
Previous report
Comparison of the Six Months Ended June 30, 2025 and 2024
Previous report
Loss on fair value remeasurement of contingent consideration for the six months ended June 30, 2025 and 2024 was $0.2 million and $0.1 million, respectively, primarily due tochanges in discount rates, the passage of time and changes in the expected timing.
Reworded paragraphs (45)
Previous wording
We are a clinical-stage biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the front and back of the eye. Our product candidate, KPI-012, which we acquired from Combangio, Inc., or Combangio, on November 15, 2021, is a mesenchymal stem cell secretome, or MSC-S, and is currently in clinical development for the treatment of persistent corneal epithelial defects, or PCED, a rare disease of impaired corneal healing. Based on the positive results of a Phase 1b clinical safety and efficacy trial of KPI-012 in patients with PCED, along with favorable preclinical safety and efficacy results, we submitted an investigational new drug application, or IND, to the U.S. Food and Drug Administration, or FDA, which was accepted in December 2022. In February 2023, we dosed our first patient in our CHASE (CornealHealingAfterSEcretome therapy) Phase 2b clinical trial of KPI-012 for PCED in the United States, or the CHASE trial.
Current wording
We are a biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the front and back of the eye. Our product candidate, KPI-012, which we acquired from Combangio, Inc., or Combangio, on November 15, 2021, is a mesenchymal stem cell secretome, or MSC-S.
Previous wording
We believe the multifactorial mechanism of action of KPI-012 also makes our MSC-S a platform technology. We are evaluating the potential development of KPI-012 for additional rare front-of-the-eye diseases, such as for the treatment of Limbal Stem Cell Deficiency and other rare corneal diseases that threaten vision. In addition, we have initiated preclinical studies under our KPI-014 program to evaluate the utility of our MSC-S platform for inherited
Current wording
Prior to the cessation of our research and development activities, we were evaluating the potential development of KPI-012 for additional rare front-of-the-eye diseases, such as for the treatment of Limbal Stem Cell Deficiency and other rare corneal diseases that threaten vision. In addition, we had initiated preclinical studies under our KPI-014 program to evaluate the utility of our MSC-S platform for inherited retinal degenerative diseases, such as Retinitis Pigmentosa and Stargardt Disease. We had expected to commercialize in the United States any of our product candidates that receive marketing approval.
Previous wording
On July 8, 2022, we sold to Alcon Pharmaceuticals Ltd. and Alcon Vision, LLC, which we refer to collectively as Alcon, the rights to manufacture, sell, distribute, market and commercialize EYSUVIS and INVELTYS and to develop, manufacture, market and otherwise exploit the AMPPLIFY Drug Delivery Technology, which we collectively refer to as the Commercial Business. We refer to this transaction as the Alcon Transaction. Alcon also assumed certain liabilities with respect to the Commercial Business at the closing of the Alcon Transaction. For a further description of the Alcon Transaction, see our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and Note 1, “Nature of Business and Basis of Presentation” of our condensed consolidated financial statements, included herein.
Current wording
On July 8, 2022, we sold to Alcon Pharmaceuticals Ltd. and Alcon Vision, LLC, which we refer to collectively as Alcon, the rights to manufacture, sell, distribute, market and commercialize EYSUVIS® (loteprednol etabonate ophthalmic suspension) 0.25%, for the short-term (up to two weeks) treatment of the signs and symptoms of dry eye disease, and INVELTYS® (loteprednol etabonate ophthalmic suspension) 1%, a topical twice-a-day ocular steroid for the treatment of post-operative inflammation and pain following ocular surgery and to develop, manufacture, market and otherwise exploit the AMPPLIFY Drug Delivery Technology, proprietary mucus-penetrating particle drug delivery technology, which we collectively refer to as the Commercial Business. We refer to this transaction as the Alcon Transaction. Alcon also assumed certain liabilities with respect to the Commercial Business at the closing of the Alcon Transaction. For a further description of the Alcon Transaction, see our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and Note 1, “Nature of Business and Basis of Presentation” of our condensed consolidated financial statements, included herein. We generated only limited revenues from product sales of EYSUVIS and INVELTYS prior to the sale of the Commercial Business to Alcon in July 2022.
Previous wording
Since inception, we have incurred significant losses from operations and negative cash flows from operations. Our net loss was $11.2 million and $20.1 million for the three and six months ended June 30, 2025, respectively, and $38.5 million for the year ended December 31, 2024. As of June 30, 2025, we had an accumulated deficit of $688.0 million. We generated only limited revenues from product sales of EYSUVIS and INVELTYS prior to the sale of the Commercial Business to Alcon in July 2022. We have financed our operations primarily through proceeds from the sale of our Commercial Business to Alcon, our initial public offering, or IPO, follow-on public common stock offerings and sales of our common stock under our sales agreement with Jefferies, LLC, or Jefferies, in at-the-market offerings, private placements of common stock and/or preferred stock (including our most recent private placement resulting in gross proceeds of approximately $10.8 million in December 2024), borrowings under credit facilities and our Loan Agreement with Oxford Finance, or the Loan Agreement, disbursements under a grant from California Institute for Regenerative Medicine, or CIRM (including our most recent disbursement of $2.3 million from CIRM in April 2025 upon the achievement of a specified milestone), convertible promissory notes and warrants.
Current wording
We have financed our operations primarily through proceeds from the sale of our Commercial Business to Alcon, our initial public offering, or IPO, follow-on public common stock offerings and sales of our common stock under our sales agreement with Jefferies, LLC, or Jefferies, in at-the-market offerings, private placements of common stock and/or preferred stock (including our most recent private placement resulting in gross proceeds of approximately $10.8 million in December 2024), borrowings under credit facilities and our Loan Agreement with Oxford Finance, or the Loan Agreement, disbursements under a grant from California Institute for Regenerative Medicine, or CIRM (including our final disbursement of $0.5 million from CIRM and September 2025 upon the achievement of a specified milestone), convertible promissory notes and warrants.
Previous wording
We have devoted substantially all of our financial resources and efforts to research and development, including preclinical studies and clinical trials and, prior to the sale of our Commercial Business to Alcon in July 2022, engaging in activities to launch and commercialize EYSUVIS and INVELTYS. As a result of our acquisition of Combangio and the sale of our Commercial Business to Alcon, we are devoting substantial financial resources to the research and development and potential commercialization of KPI-012 for PCED and any other indications we determine to pursue, including Limbal Stem Cell Deficiency. We have no revenue-generating commercial products and, as a result of our acquisition of Combangio, we may be required to pay certain milestones and royalty payments to former equityholders of Combangio, which are more fully described in the “Liquidity and Capital Resources” section. Although we are eligible to receive up to $325.0 million in payments from Alcon based upon the achievement of specified commercial sales-based milestones with respect to EYSUVIS and INVELTYS, there can be no assurance when we may receive such milestone payments or of the amount of milestone payments we may receive, if any. Additionally, we cannot be certain that we will achieve the remaining milestones under CIRM award within the required timeframes, or at all, and as such we may never receive the remaining $1.1 million under the award. We expect to continue to incur significant expenses and operating losses for the foreseeable future, including in connection with our continued development, regulatory approval efforts and commercialization, if any, of KPI-012. We may never achieve or maintain profitability. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year.
Current wording
Prior to the recent cessation of our research and development activities, we had devoted substantially all of our financial resources and efforts to research and development, including preclinical studies and clinical trials and, prior to the sale of our Commercial Business to Alcon in July 2022, engaging in activities to launch and commercialize EYSUVIS and INVELTYS. As a result of our acquisition of Combangio and the sale of our Commercial Business to Alcon, we were devoting substantial financial resources to the research and development and potential commercialization of KPI-012 for PCED and any other indications we determined to pursue, including Limbal Stem Cell Deficiency. We have no revenue-generating commercial products and, as a result of our acquisition of Combangio, we may be required to pay certain milestones and royalty payments to former equityholders of Combangio, which are more fully described in the “Liquidity and Capital Resources” section. Achievement and payment of any such potential future milestones and royalty payments to former equityholders of Combangio is dependent on the resumption of our research and development activities which would depend on completing a strategic transaction that would support our prior operating plans or otherwise obtaining significant additional funding.
Previous wording
General and administrative expenses consist primarily of salaries, benefits, stock-based compensation and travel expenses related to our executive, finance, human resources, legal, compliance, information technology and business development functions. General and administrative expenses also include professional fees for auditing, tax,
Current wording
General and administrative expenses consist primarily of salaries, benefits, stock-based compensation and travel expenses related to our executive, finance, human resources, legal, compliance, information technology and business development functions. General and administrative expenses also include professional fees for auditing, tax, information technology, consultants, legal services and allocated facility-related costs not otherwise included in research and development expenses.
Previous wording
We expect that our general and administrative expenses for 2025 will be comparable to such expenses for the year ended December 31, 2024 and expect that our general and administrative expenses will continue at similar levels for the next several years. If we obtain marketing approval for KPI-012 or any product candidates we may develop, we expect that our general and administrative expenses will increase substantially if and as we incur commercialization expenses related to product marketing, sales and distribution.
Current wording
We expect that our general and administrative expenses for 2025 will decrease compared to such expenses for the year ended December 31, 2024. If we were able to resume our research and development activities, we would expect our general and administrative expenses to increase, however, any future resumption of our historical research and development activities would depend on completing a strategic transaction that would support our prior operating plans or otherwise obtaining significant additional funding. If we were to obtain marketing approval for KPI-012 or any product candidates we may develop, we expect that our general and administrative expenses will increase substantially if and as we incur commercialization expenses related to product marketing, sales and distribution.
Previous wording
We expect that our research and development costs for 2025 will be comparable to such expenses for the year ended December 31, 2024 as we continue to advance the clinical development of KPI-012, including conducting our ongoing CHASE trial from which we expect to report topline safety and efficacy data at the end of September 2025, and as we conduct any necessary preclinical studies and clinical trials and other development activities for any other product candidate we may develop in the future, including our planned preclinical studies under our KPI-014 program. The process of conducting preclinical studies and clinical trials necessary to obtain regulatory approval is costly and time-consuming. We may never succeed in obtaining marketing approval for any of our product candidates. The probability of success for each product candidate may be affected by numerous factors, including preclinical data, clinical data, competition, manufacturing capability and commercial viability.
Current wording
If we were able to resume research and development activities, all of our existing research and development programs would be in the preclinical development stage. The process of conducting preclinical studies and clinical trials necessary to obtain regulatory approval is costly and time-consuming. If we were able to resume research and development activities, we may never succeed in obtaining marketing approval for any of our product candidates. The probability of success for each product candidate may be affected by numerous factors, including preclinical data, clinical data, competition, manufacturing capability and commercial viability.
Previous wording
KPI-012 is in Phase 2b clinical development and all of our other research and development programs are in preclinical development. Successful development and completion of preclinical studies and clinical trials is uncertain and may not result in approved products. Completion dates and completion costs can vary significantly for each product candidate and future product candidate and are difficult to predict. We will continue to make determinations as to which product candidates to pursue and how much funding to direct to each product candidate on an ongoing basis in response to the scientific and clinical success of each product candidate as well as ongoing assessments as to the commercial potential of product candidates and our ability to enter into collaborations with respect to each product candidate. We will need to raise additional capital and may seek collaborations in the future to advance KPI-012 and any product candidate we may develop. Additional private or public financings may not be available to us on acceptable terms, or at
Current wording
Successful development and completion of preclinical studies and clinical trials is uncertain and may not result in approved products. Completion dates and completion costs can vary significantly for each product candidate and future product candidate and are difficult to predict. If we able were to resume research and development activities, we would make determinations as to which product candidates to pursue and how much funding to direct to each product candidate on an ongoing basis in response to the scientific and clinical success of each product candidate as well as ongoing assessments as to the commercial potential of product candidates and our ability to enter into collaborations with respect to each product candidate.
Previous wording
Loss on fair value remeasurement of contingent consideration
Current wording
(Gain) loss on Fair Value Remeasurement of Contingent Consideration
Previous wording
In addition to the Deferred Purchase Consideration, consideration payable to the Combangio Equityholders includes potential payments of up to $105.0 million that are contingent upon the achievement of specified development, regulatory and commercialization milestones. As of June 30, 2025, of the up to $105.0 million in contingent milestone payments, we paid to the Combangio Equityholders an aggregate of $2.6 million in cash and $2.4 million in shares of common stock (representing an aggregate of 105,038 shares of our common stock) as a result of our dosing the first patient in our CHASE trial in February 2023, or the First Dosing Milestone. All potential milestone payments to the Combangio Equityholders are payable in cash going forward.
Current wording
In addition to the Deferred Purchase Consideration, consideration payable to the Combangio Equityholders includes potential payments of up to $105.0 million that are contingent upon the achievement of specified development, regulatory and commercialization milestones. As of September 30, 2025, of the up to $105.0 million in contingent milestone payments, we paid to the Combangio Equityholders an aggregate of $2.6 million in cash and $2.4 million in shares of common stock (representing an aggregate of 105,038 shares of our common stock) as a result of our dosing the first patient in our CHASE trial in February 2023, or the First Dosing Milestone. All potential milestone payments to the Combangio Equityholders are payable in cash going forward. Achievement and payment of any such potential future milestones to the Combangio Equityholders is dependent on the resumption of our research and development activities which would depend on completing a strategic transaction that would support our prior operating plans or otherwise obtaining significant additional funding.
Previous wording
On April 28, 2023, CIRM awarded Combangio a $15.0 million grant, or the CIRM Award, subject to entering into a final award agreement, to support Combangio’s ongoing KPI-012 program for the treatment of PCED as well as product and process characterization and analytical development for the program. On August 2, 2023, Combangio entered into the CIRM Award and received an initial $5.9 million disbursement from CIRM. In 2024, Combangio received an aggregate of $5.8 million in disbursements from CIRM upon the achievement of specified milestones. In April 2025, Combangio received an additional $2.3 million disbursement from CIRM upon the achievement of a specified milestone.
Current wording
On April 28, 2023, CIRM awarded Combangio a $15.0 million grant, or the CIRM Award, subject to entering into a final award agreement, to support Combangio’s KPI-012 program for the treatment of PCED as well as product and process characterization and analytical development for the program. On August 2, 2023, Combangio entered into the CIRM Award and received an initial $5.9 million disbursement from CIRM. In 2024, Combangio received an aggregate of $5.8 million in disbursements from CIRM upon the achievement of specified milestones. In April 2025 and
Previous wording
The CIRM Award is subject to a co-funding requirement under which Combangio is obligated to spend a specified minimum amount on the development of KPI-012 to obtain the full award amount. The remaining $1.1 million available under the CIRM Award is payable to Combangio only upon the achievement of specified milestones that are primarily related to Combangio’s progress in conducting the CHASE clinical trial. CIRM may permanently cease disbursements if the milestones are not met within four months of the scheduled completion dates or if the delay is not addressed to CIRM’s satisfaction, as determined by CIRM in its sole discretion. Additionally, if CIRM determines, in its sole discretion, that Combangio has not complied with the terms and conditions of the CIRM Award, CIRM may suspend or permanently cease disbursements. Under the terms of the CIRM Award, Combangio is obligated to pay a royalty on net sales of any product, service or approved drug resulting in whole or in part from the CIRM Award in the amount of 0.1% per $1.0 million of funds utilized by us until the earlier of ten years from the date of first commercial sale of such product, service or approved drug and such time as nine times the amount of funds awarded by CIRM has been paid in royalties, or the Base Royalty. In addition, following the satisfaction of the Base Royalty, Combangio is
Current wording
The CIRM Award was subject to a co-funding requirement under which Combangio was obligated to spend a specified minimum amount on the development of KPI-012 to obtain the full award amount. The remaining $0.6 million available under the CIRM Award was payable to Combangio only upon the achievement of specified milestones that are primarily related to Combangio’s progress in conducting the CHASE clinical trial. Due to our determination to cease clinical development of KPI-012 for PCED, we will not receive the remaining $0.6 million disbursements available under the CIRM Award.
Previous wording
General and administrative expenses were $4.6 million for the three months ended June 30, 2025, compared to $4.3 million for the three months ended June 30, 2024, which was an increase of $0.3 million. The increase in general and administrative expenses for the three months ended June 30, 2025 was due to a $0.3 million increase in stock-based compensation costs and $0.2 million increase in employee related costs, partially offset by a $0.2 million decrease inadministrative and professional service fees.
Current wording
General and administrative expenses were $4.5 million for the three months ended September 30, 2025, compared to $4.4 million for the three months ended September 30, 2024, which was an increase of $0.1 million. The increase in general and administrative expenses for the three months ended September 30, 2025 was primarily due to an increase inadministrative and professional service fees of $0.4 million, partially offset by a decrease in employee costs of $0.3 million.
Previous wording
Research and development expenses were $6.2 million for the three months ended June 30, 2025, compared to $5.3 million for the three months ended June 30, 2024, an increase of $0.9 million. The increase was primarily due toa $0.7 million increase in employee-related costs and $0.3 million increase in KPI-012 development costs, as we advance the clinical development of KPI-012, partially offset by $0.1 million decrease inother research and development costs.
Current wording
Research and development expenses were $6.1 million for the three months ended September 30, 2025, compared to $5.2 million for the three months ended September 30, 2024, an increase of $1.0 million. The increase was primarily due toa $0.9 million increase in employee-related costs and a $0.1 million increase in KPI-012 development costs, partially offset by a $0.1 million decrease in other research and development costs.
Previous wording
Loss on fair value remeasurement of contingent consideration for the three months ended June 30, 2025 was $0.2 million as compared to a gain of less than $0.1 million for the three months ended June 30, 2024, primarily due tochanges in discount rates, the passage of time and changes in the expected timing.
Current wording
Gain on fair value remeasurement of contingent consideration for the three months ended September 30, 2025 was $4.8 million as compared to a loss of $0.4 million for the three months ended September 30, 2024, primarily due to the determination to cease developmentof KPI-012.
Previous wording
Interest income was $0.4 million for the three months ended June 30, 2025 and was $0.5 million for the three months ended June 30, 2024. Interest income consists of interest earned on our cash, cash equivalents and short-term investments, if any. The decrease was attributable to the quantity and mix of investments and lower interest rates during the three months ended June 30, 2025, as compared to the three months ended June 30, 2024.
Current wording
Interest income was $0.3 million for the three months ended September 30, 2025 and was $0.6 million for the three months ended September 30, 2024. Interest income consists of interest earned on our cash, cash equivalents and short-term investments, if any. The decrease was attributable to the quantity and mix of investments and lower interest rates during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024.
Previous wording
We incurred interest expense of $2.2 million for the six months ended June 30, 2025 and $2.9 million for the six months ended June 30, 2024. Interest expense for the six months ended June 30, 2025 and 2024 was comprised of the contractual coupon interest expense, the amortization of the debt discount and the accretion of the final payment fee associated with our Loan Agreement with Oxford Finance. During the six months ended June 30, 2025, $29.3 millionof indebtedness was outstanding under our Loan Agreement until $2.3 million was repaid on June 26, 2025 resulting in an outstanding indebtedness of $26.9 million as of June 30, 2025. During the six months ended June 30, 2024, $34.0 million of indebtedness was outstanding under our Loan Agreement.
Current wording
We incurred interest expense of $1.0 million for the three months ended September 30, 2025 and $1.5 million for the three months ended September 30, 2024. Interest expense for the three months ended September 30, 2025 and 2024 was comprised of the contractual coupon interest expense, the amortization of the debt discount and the accretion of the final payment fee associated with our Loan Agreement with Oxford Finance. During the three months ended September 30, 2025, $26.9 millionof indebtedness was outstanding under our Loan Agreement. During the three months ended September 30, 2024, $34.0 million of indebtedness was outstanding under our Loan Agreement.
Previous wording
Grant income for the three months ended June 30, 2025 and 2024 was $0.5 million and $1.0 million, respectively, related to the CIRM Award. The decrease in grant income was due to the achievement of specified milestones under the CIRM Award and the timing of the associated costs related to the CHASE Phase 2b clinical trial.
Current wording
Grant income for the three months ended September 30, 2025 and 2024 was $0.5 million and $2.0 million, respectively, related to the CIRM Award. The decrease in grant income was due to the achievement of specified milestones under the CIRM Award and the timing of the associated costs related to the CHASE Phase 2b clinical trial.
Previous wording
The following table summarizes the results of our operations for the six months ended June 30, 2025 and 2024:
Current wording
The following table summarizes the results of our operations for the nine months ended September 30, 2025 and 2024:
Previous wording
General and administrative expenses were $9.2 million for the six months ended June 30, 2025, compared to $9.7 million for the six months ended June 30, 2024, which was a decrease of $0.5 million. The decrease in general and administrative expenses for the six months ended June 30, 2025 was primarily due to a $0.6 million decrease in
Current wording
General and administrative expenses were $13.8 million for the nine months ended September 30, 2025, comparable to $14.1 million for the nine months ended September 30, 2024, which was a decrease of $0.4 million. The decrease in general and administrative expenses for the nine months ended September 30, 2025 was primarily due to a $0.9 million decrease in employee costs, partially offset by a $0.3 million increase in administrative and professional service fees and a $0.2 million increase in stock-based compensation.
Previous wording
The following table summarizes the research and development expenses incurred during the six months ended June 30, 2025 and 2024:
Current wording
The following table summarizes the research and development expenses incurred during the nine months ended September 30, 2025 and 2024:
Previous wording
Research and development expenses were $12.3 million for the six months ended June 30, 2025, compared to $11.7 million for the six months ended June 30, 2024, which was an increase of $0.6 million. The increase was primarily due to a $0.8 million increase in employee-related costs and $0.1 million increase in KPI-012 development costs, as we advance the clinical development of KPI-012, partially offset by $0.2 million decrease in other research and development costs.
Current wording
Research and development expenses were $18.4 million for the nine months ended September 30, 2025, compared to $16.8 million for the nine months ended September 30, 2024, which was an increase of $1.6 million. The increase was primarily due to a $1.7 million increase in employee-related costs and a $0.2 million increase in KPI-012 development costs, partially offset by a $0.3 million decrease in other research and development costs.
Previous wording
Interest income was $0.9 million for the six months ended June 30, 2025 and was $1.0 million for the six months ended June 30, 2024. Interest income consists of interest earned on our cash, cash equivalents and short-term investments, if any. The decrease was attributable to the quantity and mix of investments and lower interest rates during the six months ended June 30, 2025, as compared to the six months ended June 30, 2024.
Current wording
Interest income was $1.1 million for the nine months ended September 30, 2025 and was $1.6 million for the nine months ended September 30, 2024. Interest income consists of interest earned on our cash, cash equivalents and short-term investments, if any. The decrease was attributable to the quantity and mix of investments and lower interest rates during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024.
Previous wording
We incurred interest expense of $1.1 million for the three months ended June 30, 2025 and $1.5 million for the three months ended June 30, 2024. Interest expense for the three months ended June 30, 2025 and 2024 was comprised of the contractual coupon interest expense, the amortization of the debt discount and the accretion of the final payment fee associated with our Loan Agreement with Oxford Finance. During the three months ended June 30, 2025, $29.3 millionof indebtedness was outstanding under our Loan Agreement until $2.3 million was repaid on June 26, 2025 resulting in an outstanding indebtedness of $26.9 million as of June 30, 2025. During the three months ended June 30, 2024, $34.0 million of indebtedness was outstanding under our Loan Agreement.
Current wording
We incurred interest expense of $3.1 million for the nine months ended September 30, 2025 and $4.4 million for the nine months ended September 30, 2024. Interest expense for the nine months ended September 30, 2025 and 2024 was comprised of the contractual coupon interest expense, the amortization of the debt discount and the accretion of the final payment fee associated with our Loan Agreement with Oxford Finance. During the nine months ended September 30, 2025, $29.3 millionof indebtedness was outstanding under our Loan Agreement until $2.3 million was repaid on June 26, 2025 resulting in an outstanding indebtedness of $26.9 million as of September 30, 2025. During the nine months ended September 30, 2024, $34.0 million of indebtedness was outstanding under our Loan Agreement.
Previous wording
Grant income for the six months ended June 30, 2025 and 2024 was $2.9 million and $2.1 million, respectively, related to the CIRM Award. The increase in grant income was due to the achievement of specified milestones under the CIRM Award and the timing of the associated costs related to the CHASE Phase 2b clinical trial.
Current wording
Grant income for the nine months ended September 30, 2025 and 2024 was $3.4 million and $4.0 million, respectively, related to the CIRM Award. The increase in grant income was due to the achievement of specified milestones under the CIRM Award and the timing of the associated costs related to the CHASE Phase 2b clinical trial.
Previous wording
In July 2022, we sold our Commercial Business to Alcon. In addition to the upfront cash payment of $60.0 million we received from Alcon, we are also eligible to receive from Alcon up to four commercial-based sales milestone payments as follows: (1) $25.0 million upon the achievement of $50.0 million or more in aggregate worldwide net sales of EYSUVIS and INVELTYS in a calendar year from 2023 to 2028, (2) $65.0 million upon the achievement of $100.0 million or more in aggregate worldwide net sales of EYSUVIS and INVELTYS in a calendar year from 2023 to 2028, (3) $75.0 million upon the achievement of $175.0 million or more in aggregate worldwide net sales of EYSUVIS and INVELTYS in a calendar year from 2023 to 2029 and (4) $160.0 million upon the achievement of $250.0 million or more in aggregate worldwide net sales of EYSUVIS and INVELTYS in a calendar year from 2023 to 2029. Each milestone payment will only become payable once, if at all, upon the first time such milestone is achieved, and only one milestone payment will be paid with respect to a calendar year. In the event that more than one milestone is achieved in a calendar year, the higher milestone payment will become payable and the lower milestone payment will become payable only if the corresponding milestone is achieved again in a subsequent calendar year. To date, we have not received any such milestone payments. We now have no revenue-generating commercial products, and although we are eligible to receive up to $325.0 million in milestone-based payments from Alcon, there can be no assurance as to when we may receive such milestone payments or the amount of milestone payments we may receive, if any.
Current wording
In July 2022, we sold our Commercial Business to Alcon. In addition to the upfront cash payment of $60.0 million we received from Alcon, we are also eligible to receive from Alcon up to four commercial-based sales milestone payments as follows: (1) $25.0 million upon the achievement of $50.0 million or more in aggregate worldwide net sales of EYSUVIS and INVELTYS in a calendar year from 2023 to 2028, (2) $65.0 million upon the achievement of $100.0 million or more in aggregate worldwide net sales of EYSUVIS and INVELTYS in a calendar year from 2023 to 2028, (3) $75.0 million upon the achievement of $175.0 million or more in aggregate worldwide net sales of EYSUVIS and INVELTYS in a calendar year from 2023 to 2029 and (4) $160.0 million upon the achievement of $250.0 million or more in aggregate worldwide net sales of EYSUVIS and INVELTYS in a calendar year from 2023 to 2029. Each
Previous wording
On March 3, 2023, we filed a shelf registration statement on Form S-3 with the SEC, or the 2023 Shelf Registration, which was declared effective on May 11, 2023. Under the 2023 Shelf Registration we may offer and sell up to $350.0 million of a variety of securities including common stock, preferred stock, warrants, depositary shares, debt securities, subscription rights or units. In accordance with the terms of the Open Market Sale Agreement, dated January 19, 2023, between the Company and Jefferies, or the Open Market Sale Agreement, we may issue and sell, from time to time, shares of our common stock in an at-the-market equity offering through Jefferies, as sales agent, under the 2023 Shelf Registration.
Current wording
On March 3, 2023, we filed a shelf registration statement on Form S-3 with the SEC, or the 2023 Shelf Registration, which was declared effective on May 11, 2023. Under the 2023 Shelf Registration we may offer and sell up to $350.0 million of a variety of securities including common stock, preferred stock, warrants, depositary shares, debt securities, subscription rights or units. In accordance with the terms of the Open Market Sale Agreement, dated January 19, 2023, between us and Jefferies, or the Open Market Sale Agreement, we may issue and sell, from time to time, shares of our common stock in an at-the-market equity offering through Jefferies, as sales agent, under the 2023 Shelf Registration.
Previous wording
From entry into the Open Market Sale Agreement and as of June 30, 2025, we sold an aggregate of 784,196 shares of our common stock under the 2023 Shelf Registration for total net proceeds of $7.0 million, none of which were sold during the three and six months ended June 30, 2025. During the six months ended June 30, 2024, we sold an aggregate of 387,500 shares of our common stock under the Open Market Sale Agreement under the 2023 Shelf Registration for total net proceeds of $2.5 million, all of which were sold during the three months ended June 30, 2024.
Current wording
From entry into the Open Market Sale Agreement and as of September 30, 2025, we sold an aggregate of 784,196 shares of our common stock under the 2023 Shelf Registration for total net proceeds of $7.0 million, none of which were sold during the three and nine months ended September 30, 2025. During the nine months ended September 30, 2024, we sold an aggregate of 387,500 shares of our common stock under the Open Market Sale Agreement under the 2023 Shelf Registration for total net proceeds of $2.5 million, none of which were sold during the three months ended September 30, 2024.
Previous wording
On December 27, 2022, we entered into an amendment to the Loan Agreement with Combangio and Oxford Finance, or the Third Loan Amendment, pursuant to which Oxford Finance agreed to amend certain provisions of the Loan Agreement to permit the transfer of the listing of our common stock from The Nasdaq Global Select Market to The Nasdaq Capital Market. Pursuant to the Third Loan Amendment, we agreed (A) to make partial prepayments of the principal amount of the term loan outstanding under the Loan Agreement as follows, or the Third Amendment Prepayments: (1) a payment of $5.0 million on or before June 30, 2023, representing a partial prepayment of principal in the amount of $4.7 million, plus a final payment fee of $0.3 million and (2) a payment of $5.0 million on or before January 31, 2024, representing a partial prepayment of principal in the amount of $4.7 million, plus a final payment fee of $0.3 million and (B) the start date for us to make amortization payments under the Loan Agreement was changed from January 1, 2026 to January 1, 2025, or the Amortization Date. On January 25, 2023, we paid the Third Amendment Prepayments and the principal loan balance under the Loan Agreement following such prepayments was $34.0 million.
Current wording
On December 27, 2022, we entered into an amendment to the Loan Agreement with Combangio and Oxford Finance, or the Third Loan Amendment, pursuant to which Oxford Finance agreed to amend certain provisions of the Loan Agreement to permit the transfer of the listing of our common stock from The Nasdaq Global Select Market to The Nasdaq Capital Market. Pursuant to the Third Loan Amendment, we agreed (A) to make partial prepayments of the principal amount of the term loan outstanding under the Loan Agreement as follows, or the Third Amendment Prepayments: (1) a payment of $5.0 million on or before June 30, 2023, representing a partial prepayment of principal in the amount of $4.7 million, plus a final payment fee of $0.3 million and (2) a payment of $5.0 million on or before
Previous wording
On April 28, 2023, CIRM awarded Combangio a $15.0 million grant, subject to entering into a final award agreement, to support its ongoing KPI-012 program for the treatment of PCED as well as product and process characterization and analytical development for the program. On August 2, 2023, Combangio entered into the CIRM Award and received a $5.9 million disbursement from CIRM. In August 2024, December 2024, and April 2025 Combangio received an additional $3.2 million, $2.5 million and $2.3 million, respectively, in disbursements from CIRM upon achievement of specified milestones under the CIRM Award. For a further description of the CIRM Award and the potential milestone payments we may receive, see “Financial Operations Overview – Grant Income” above.
Current wording
On April 28, 2023, CIRM awarded Combangio a $15.0 million grant, subject to entering into a final award agreement, to support its ongoing KPI-012 program for the treatment of PCED as well as product and process characterization and analytical development for the program. On August 2, 2023, Combangio entered into the CIRM Award and received a $5.9 million disbursement from CIRM. In August 2024, December 2024, April 2025 and September 2025, Combangio received an additional $3.2 million, $2.5 million, $2.3 million and $0.5 million, respectively, in disbursements from CIRM upon achievement of specified milestones under the CIRM Award. Due to our determination to cease clinical development of KPI-012 for PCED, we will not receive the remaining $0.6 million disbursement amount available under the CIRM Award.
Previous wording
$40.0 million and the total potential maximum payout for future sales-based milestone payments is an additional $65.0 million. To date, of the $40.0 million of contingent consideration payable upon achievement of specified development, regulatory and commercialization milestones, in March 2023 we paid to the former Combangio Equityholders an aggregate of $2.5 million in cash and $2.4 million in shares of our common stock (representing an aggregate of 105,038 shares of our common stock) following dosing of the first patient in our CHASE trial in February 2023. The remaining amount of $0.1 million for this milestone was paid in cash in January 2024. For a full description of the consideration payable as a result of the Combangio Acquisition, see our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and Note 3, “Fair Value of Financial Instruments”, of our condensed consolidated financial statements.
Current wording
$40.0 million and the total potential maximum payout for future sales-based milestone payments is an additional $65.0 million. To date, of the $40.0 million of contingent consideration payable upon achievement of specified development, regulatory and commercialization milestones, in March 2023 we paid to the former Combangio Equityholders an aggregate of $2.5 million in cash and $2.4 million in shares of our common stock (representing an aggregate of 105,038 shares of our common stock) following dosing of the first patient in our CHASE trial in February 2023. The remaining amount of $0.1 million for this milestone was paid in cash in January 2024. Achievement and payment of any potential future milestones to the Combangio Equityholders is dependent on the resumption of our research and development activities which would depend on completing a strategic transaction that would support our prior operating plans or otherwise obtaining significant additional funding.
Previous wording
As of June 30, 2025 and December 31, 2024, we had $31.9 million and $51.2 million in cash and cash equivalents, respectively. As of June 30, 2025 and December 31, 2024, we had $26.9 million and $29.3 million, respectively, in indebtedness, which represented the aggregate principal amount that was outstanding under the Loan Agreement with Oxford Finance.
Current wording
As of September 30, 2025 and December 31, 2024, we had $21.1 million and $51.2 million in cash and cash equivalents, respectively. As of September 30, 2025 and December 31, 2024, we had $26.9 million and $29.3 million, respectively, in indebtedness, which represented the aggregate principal amount that was outstanding under the Loan Agreement with Oxford Finance. On October 19, 2025, pursuant to the terms of the Loan Agreement, Oxford Finance informed us that it intended to foreclose on all of our remaining assets and that Oxford Finance would not consent to the Company’s use of cash for any reason other than for minimal payroll and related expenses pending Oxford Finance’s foreclosure of the Company’s assets. Oxford then swept substantially all of our cash resources from our bank accounts. On November 3, 2025, Oxford Finance informed us that it intended to pause its foreclosure of the Company’s assets and permitted us to use $125,000 of cash it previously swept to fund the negotiation and execution of the Convertible Loan Agreement and to fund preliminary preparation work on this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025.
Previous wording
Net cash used in operating activities for the six months ended June 30, 2025 was $16.6 million, compared to $20.1 million for the six months ended June 30, 2024, a decrease of $3.5 million, primarily due to a $1.3 million decrease in the net loss adjusted for non-cash charges and a $2.2 million decrease in working capital. Notable working capital fluctuations included a $0.1 million increase in prepaid expenses and other current assets during the six months ended June 30, 2025, as compared to a $2.7 million increase during the six months ended June 30, 2024, primarily as a result of a disbursement of $3.2 million from CIRM in August 2024, which was included in prepaid expenses and other current assets as of June 30, 2024. This fluctuation in prepaid expenses and other current assets was partially offset by an increase of $0.3 million in accounts payable and accrued expenses and other current liabilities fluctuations primarily due to the timing of payables.
Current wording
Net cash used in operating activities for the nine months ended September 30, 2025 was $27.4 million, compared to $24.8 million for the nine months ended September 30, 2024, a decrease of $2.7 million, primarily due to a $1.4 million decrease in working capital and a $1.3 million increase in the net loss adjusted for non-cash charges. Notable working capital fluctuations included a $1.6 million increase in prepaid expenses and other current assets during the nine months ended September 30, 2025, as compared to a $0.1 million increase during the nine months ended September 30, 2024, primarily as a result of the payment of prepaid insurance and retention payments during the third quarter of 2025. This fluctuation in prepaid expenses and other current assets was partially offset by a decrease of $0.2 million in accounts payable and accrued expenses and other current liabilities fluctuations primarily due to the timing of payables.
Previous wording
Net cash used in investing activities for the six months ended June 30, 2025 and 2024 was less than $0.1 million in each period. Net cash used in investing activities, in both periods, was related to purchases of property and equipment and other assets.
Current wording
Net cash used in investing activities for the nine months ended September 30, 2025 and 2024 was less than $0.1 million and $0.1 million, respectively. Net cash used in investing activities, in both periods, was related to purchases of property and equipment and other assets.
Previous wording
Net cash used in financing activities for the six months ended June 30, 2025 was $2.7 million, primarily due toa $2.5 million repayment of principal and payment fee on our Loan Agreement and $0.1 million payment of issuance costs related tothe sale of common stock and shares of our Series I Preferred Stock in our December 2024 private placement.
Current wording
Net cash used in financing activities for the nine months ended September 30, 2025 was $2.6 million, primarily due toa $2.5 million repayment of principal and payment fee on our Loan Agreement and $0.1 million payment of issuance costs related tothe sale of common stock and shares of our Series I Preferred Stock in our December 2024 private placement.
Previous wording
Net cash provided by financing activities for the six months ended June 30, 2024 was $23.4 million, largely consisted of $12.5 million of gross proceeds from the sale of common stock and shares of our Series H Preferred Stock in our June 2024 private placement, $8.5 million of net proceeds from the sale of shares of our Series G Preferred Stock in our March 2024 private placement and $2.5 million of net proceeds from the sale of shares of our common stock through Jefferies under our at-the-market equity offering, partially offset by a $0.1 million payment for the First Dosing Milestone reflected in financing activities.
Current wording
Net cash provided by financing activities for the nine months ended September 30, 2024 was $23.2 million, largely consisted of $12.3 million of net proceeds from the sale of common stock and shares of our Series H Preferred Stock in our June 2024 private placement, $8.5 million of net proceeds from the sale of shares of our Series G Preferred Stock in our March 2024 private placement and $2.5 million of net proceeds from the sale of shares of our common stock through Jefferies under our at-the-market equity offering, partially offset by a $0.1 million payment for the First Dosing Milestone reflected in financing activities.
Previous wording
Our expenses will also increase if and as we:
Current wording
If we were able to resume our research and development activities, our expenses will also increase if and as we:
Previous wording
We expect to continue to incur significant expenses and operating losses. Net losses may fluctuate significantly from quarter-to-quarter and year-to-year. We anticipate that our cash and cash equivalents as of June 30, 2025 will enable us to fund our operations, lease and debt service obligations, and capital expenditure requirements into the first quarter of 2026. We expect that our existing cash resources will be sufficient to enable us to obtain topline safety and efficacy data from our ongoing CHASE trial of KPI-012 in PCED. However, we do not expect that our existing cash resources will be sufficient to enable us to complete the clinical development of KPI-012 for PCED or for any other indication. We have based our estimates on assumptions that may prove to be wrong, and our operating plan may change as a result of many factors currently unknown to us. For example, our estimates assume that we remain in compliance with the covenants and no event of default occurs under our Loan Agreement with Oxford Finance. If an event of default occurs under our Loan Agreement and Oxford Finance exercises its rights under the Loan Agreement to foreclose on our cash, our ability to fund our operations, lease and debt service obligations will be shorter than we currently expect. As a result, we could deplete our available capital resources sooner than we currently expect.
Current wording
We expect to continue to incur significant expenses and operating losses. Net losses may fluctuate significantly from quarter-to-quarter and year-to-year.
Previous wording
In addition, since these amounts are not expected to be sufficient to fund our operations for at least twelve months from the date of issuance of the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q, there is substantial doubt about our ability to continue as a going concern. Our management has developed plans to fund our operations, which primarily consist of raising additional capital through one or more of the following: additional equity or debt financings; additional collaborations partnerships or licensing transactions; or other sources. However, there can be no assurance that we will be able to complete any such transaction on acceptable terms or otherwise, and we may be unable to obtain sufficient additional capital. If we are not able to secure sufficient additional capital in the near term, we will need to implement additional cost reduction strategies, which could include delaying, limiting, further reducing or eliminating both internal and external costs related to our operations and research and development programs. The condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.
Current wording
The condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.
Showing the first 40 of 45 pairs. Open the source sections for the rest.
Rearranged current paragraphs (7)
Current report — wording carried from elsewhere
Since inception, we have incurred significant losses from operations and negative cash flows from operations. Our net loss was $7.6 million and $27.7 million for the three and nine months ended September 30, 2025, respectively, and $38.5 million for the year ended December 31, 2024. As of September 30, 2025, we had an accumulated deficit of $695.6 million.
Current report — wording carried from elsewhere
Although we are eligible to receive up to $325.0 million in payments from Alcon based upon the achievement of specified commercial sales-based milestones with respect to EYSUVIS and INVELTYS, there can be no assurance when we may receive such milestone payments or of the amount of milestone payments we may receive, if any. Additionally, due to our determination to cease clinical development of KPI-012 for PCED, we will not receive the remaining $0.6 million disbursement under the CIRM Award. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We may never achieve or maintain profitability. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year.
Current report — wording carried from elsewhere
milestone payment will only become payable once, if at all, upon the first time such milestone is achieved, and only one milestone payment will be paid with respect to a calendar year. In the event that more than one milestone is achieved in a calendar year, the higher milestone payment will become payable and the lower milestone payment will become payable only if the corresponding milestone is achieved again in a subsequent calendar year. To date, we have not received any such milestone payments. We now have no revenue-generating commercial products, and although we are eligible to receive up to $325.0 million in milestone-based payments from Alcon, there can be no assurance as to when we may receive such milestone payments or the amount of milestone payments we may receive, if any.
Current report — wording carried from elsewhere
January 31, 2024, representing a partial prepayment of principal in the amount of $4.7 million, plus a final payment fee of $0.3 million and (B) the start date for us to make amortization payments under the Loan Agreement was changed from January 1, 2026 to January 1, 2025, or the Amortization Date. On January 25, 2023, we paid the Third Amendment Prepayments and the principal loan balance under the Loan Agreement following such prepayments was $34.0 million.
Current report — wording carried from elsewhere
For a full description of the consideration payable as a result of the Combangio Acquisition, see our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and Note 3, “Fair Value of Financial Instruments”, of our condensed consolidated financial statements.
Current report — wording carried from elsewhere
If we obtain marketing approval for KPI-012, KPI-014 or any product candidates we may develop, we expect that our general and administrative expenses will increase substantially if and as we incur commercialization expenses related to product marketing, sales and distribution.
Current report — wording carried from elsewhere
As a company, we have had limited experience commercializing products, and we may not be able to commercialize a product successfully in the future. There are numerous examples of unsuccessful product launches and failures to meet expectations of market potential, including by pharmaceutical companies with more experience and
Rearranged previous paragraphs (8)
Previous report — wording carried elsewhere
retinal degenerative diseases, such as Retinitis Pigmentosa and Stargardt Disease. We expect to commercialize in the United States any of our product candidates that receive marketing approval.
Previous report — wording carried elsewhere
We previously developed and commercialized two marketed products, EYSUVIS® (loteprednol etabonate ophthalmic suspension) 0.25%, for the short-term (up to two weeks) treatment of the signs and symptoms of dry eye disease, and INVELTYS® (loteprednol etabonate ophthalmic suspension) 1%, a topical twice-a-day ocular steroid for the treatment of post-operative inflammation and pain following ocular surgery. Both products applied a proprietary mucus-penetrating particle drug delivery technology, which we referred to as the AMPPLIFY® Drug Delivery Technology.
Previous report — wording carried elsewhere
information technology, consultants, legal services and allocated facility-related costs not otherwise included in research and development expenses.
Previous report — wording carried elsewhere
all. Our failure to raise capital as and when needed would have a material adverse effect on our financial condition and our ability to pursue our business strategy.
Previous report — wording carried elsewhere
Loss (gain) on Fair Value Remeasurement of Contingent Consideration
Previous report — wording carried elsewhere
Loss (gain) on fair value remeasurement of contingent consideration
Previous report — wording carried elsewhere
employee-related costs, a $0.1 million decrease in administrative and professional service fees, partially offset by a $0.2 million increase in stock-based compensation costs.
Previous report — wording carried elsewhere
We anticipate that our research and development expenses will increase substantially in the future as compared to prior periods as we advance the clinical development of KPI-012 and as we conduct any necessary preclinical studies and clinical trials and other development activities for any other product candidates we may develop in the future, including our planned preclinical studies under our KPI-014 program. If we obtain marketing approval for KPI-012 or any product candidates we may develop, we expect that our general and administrative expenses will increase substantially if and as we incur commercialization expenses related to product marketing, sales and distribution.