Unicycive Therapeutics, Inc.

Previous wording

This Quarterly Report on Form 10-Q for the nine-month period ended September 30, 2024 contains “forward-looking statements” within the meaning of the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements contain information about our expectations, beliefs or intentions regarding our product development and commercialization efforts, business, financial condition, results of operations, strategies or prospects, and other similar matters. These forward-looking statements are based on management’s current expectations and assumptions about future events, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. These statements may be identified by words such as “expects,” “plans,” “projects,” “will,” “may,” “anticipates,” “believes,” “should,” “intends,” “estimates,” and other words of similar meaning.

Current wording

This Quarterly Report on Form 10-Q for the three-month period ended March 31, 2025 contains “forward-looking statements” within the meaning of the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements contain information about our expectations, beliefs or intentions regarding our product development and commercialization efforts, business, financial condition, results of operations, strategies or prospects, and other similar matters. These forward-looking statements are based on management’s current expectations and assumptions about future events, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. These statements may be identified by words such as “expects,” “plans,” “projects,” “will,” “may,” “anticipates,” “believes,” “should,” “intends,” “estimates,” and other words of similar meaning.

Previous wording

AKI is a sudden episode of kidney failure or kidney damage (within the first 90 days of injury). After 90 days, the patient is considered to have progressed into CKD. AKI affects more than 2 million US patients and costs the healthcare system in excess of $9 billion per year. More than 300,000 patients per year in the U.S. die due to AKI that has many causes.

Current wording

AKI is a sudden episode of kidney failure or kidney damage (within the first 90 days of injury). After 90 days, the patient is considered to have progressed into CKD. AKI affects more than 2 million U.S. patients and costs the healthcare system in excess of $9 billion per year. More than 300,000 patients per year in the U.S. die due to AKI. Currently there are no FDA approved medicines to treat DGF and/or AKI. Treatment options for AKI include continuous renal replacement therapy, renal transplant, and dialysis. In most cases the damage to the kidney is irreversible, and the patient needs to have a renal transplant or be on dialysis for life. Therefore, there is a high unmet medical need. If approved, UNI-494 has the potential to be a first-in-class drug for the treatment of AKI.

Previous wording

Since our formation we have devoted substantially all of our resources to developing our product candidates. We have incurred significant operating losses to date. Our net losses were $22.7 million and $15.2 million for the nine months ended September 30, 2023, and September 30, 2024, respectively. As of September 30, 2024, we had an accumulated deficit of $79.7 million. We expect that our operating expenses will increase significantly as we advance our product candidates through pre-clinical and clinical development, seek regulatory approval, and prepare for and, if approved, proceed to commercialization; acquire, discover, validate and develop additional product candidates; obtain, maintain, protect and enforce our intellectual property portfolio; and hire additional personnel.

Current wording

Since our formation we have devoted substantially all of our resources to developing our product candidates. We have incurred significant operating losses to date. Our net loss was $20.9 million for the three months ended March 31, 2024 and we had net income of 0.6 million for the three months ended March 31, 2025. As of March 31, 2025, we had an accumulated deficit of $100.7 million. We expect that our operating expenses will increase significantly as we advance our product candidates through pre-clinical and clinical development, seek regulatory approval, and prepare for and, if approved, proceed to commercialization; acquire, discover, validate and develop additional product candidates; obtain, maintain, protect and enforce our intellectual property portfolio; and hire additional personnel.

Previous wording

Research and development expenses decreased by approximately $0.4 million, or 10%, from approximately $3.4 million for the three months ended September 30, 2023, to approximately $3.0 million for the three months ended September 30, 2024. The decrease in research and development expenses was primarily due to a $0.4 million decrease in drug development costs. Labor costs increased $151,000 from the prior period. Consulting and other costs increased $89,000. Non-cash stock compensation costs decreased $176,000.

Current wording

Research and development expenses decreased by approximately $4.6 million, or 68%, from approximately $6.8 million for the three months ended March 31, 2024, to approximately $2.2 million for the three months ended March 31, 2025. The decrease in research and development expenses was primarily due to a $5.0 million reduction in drug development costs which was partially offset by an increase in labor costs of $151,000 over the prior period. Consulting and other costs increased $189,000 and stock compensation of $36,000.

Previous wording

General and administrative expenses increased by 640,000, or 25%, from approximately $2.6 million for the three months ended September 30, 2023, to approximately $3.2 million for the three months ended September 30, 2024 primarily due to an decrease of $149,000 in non-cash stock compensation costs. Insurance expense decreased $2,000. Labor costs increased $76,000 from the prior period. Travel, rent, and other costs increased $715,000.

Current wording

General and administrative expenses increased by $3.4 million, or 143%, from approximately $2.4 million for the three months ended March 31, 2024, to approximately $5.8 million for the three months ended March 31, 2025 primarily due to an increase of $1.4 million in consulting and professional services expenses related to preparation of our commercial launch. Other professional services increased $1.3 million from the prior period. Labor costs increased $467,000 from the prior period. Travel, rent, and other costs increased $230,000. Non-cash stock compensation costs increased $6,000.

Previous wording

Other income (expenses) increased $ 0.5 million, or 34%, from $1.6 million in the three months ended September 30, 2023 to $2.2 million for the three months ended September 30, 2024 due primarily to a change in fair value of our warrant liability.

Current wording

Other income (expenses) increased $20.3 million, or 173%, from $11.8 million expense in the three months ended March 31, 2024 to $8.6 million income for the three months ended March 31, 2025 primarily due to a change in fair value of our warrant liability. Interest income increased approximately $157,000 for the three months ended March 31, 2025 versus the comparable prior period.

Previous wording

Since our formation through December 31, 2020, we have funded our operations with the sale of common and preferred stock, convertible notes and from a loan from our Chief Executive Officer and principal stockholder.

Current wording

Since our formation through June 31, 2020, we funded our operations with the sale of common and preferred stock, convertible notes and from a loan from our Chief Executive Officer and principal stockholder.

Previous wording

Future revenue streams may consist of collaboration or licensing revenue as well as product sales.

Current wording

Future revenue streams may consist of collaboration or licensing revenue as well as product sales. We have generated approximately $1.6 million in licensing revenue to date.

Previous wording

On March 3, 2023, we entered into a securities purchase agreement with certain healthcare-focused institutional investors that may provide up to $130.0 million in gross proceeds through a private placement and that included initial upfront funding of $30.0 million. Proceeds from the offering will be used to support our NDA submission with the FDA for approval of oxylanthanum carbonate for the treatment of hyperphosphatemia in the U.S. and, if approved, for the commercial launch of oxylanthanum carbonate in the U.S.

Current wording

On March 3, 2023, we entered into a securities purchase agreement with certain healthcare-focused institutional investors that may provide up to $130.0 million in gross proceeds through a private placement and that included initial upfront funding of $28.0 million in net proceeds.

Previous wording

On March 13, 2024, we signed a securities purchase agreement with certain healthcare-focused institutional investors that provided $50 million in gross proceeds to us through a private placement. Pursuant to the securities purchase agreement, we issued to institutional investors $50.0 million in shares of our Series B-1 Convertible Preferred Stock. 50,000 Shares of Series B-1 Convertible Preferred Stock were issued at a price of $1,000.00 per share and each share is convertible into shares of common stock at a rate equal to the initial $1,000 purchase price divided by the initial conversion price of $1.00 per share.

Current wording

On March 13, 2024, we entered into a securities purchase agreement with certain accredited investors to provide $50 million in gross proceeds through a private placement. Pursuant to the securities purchase agreement, we issued institutional purchasers $50.0 million in shares of Series B Convertible Preferred Stock. We received $46.2 million in net proceeds.

Previous wording

We have incurred net losses since our inception. For the nine months ended September 30, 2024, we had a net loss of $15.2 million, and we expect to incur substantial additional losses in future periods. As of September 30, 2024, we had an accumulated deficit of $79.7 million.

Current wording

We have incurred net losses since our inception. For the three months ended March 31, 2025, we had net income of $0.6 million. However, the net income was a result of the change in the fair value of the warrant liability. We expect to incur substantial losses in future periods. As of March 31, 2025, we had an accumulated deficit of $100.7 million.

Previous wording

We expect to continue incurring losses in the future and will be required to raise additional capital in the future to complete our clinical trials, pursue product development initiatives and penetrate markets for the sale of our products. We believe that we will continue to have access to capital resources through possible equity offerings, debt financings, corporate collaborations or other means. There can be no assurance that we will be able to obtain additional financing on terms acceptable to us, on a timely basis or at all. If we are unable to secure additional capital, we may be required to curtail any clinical trials and development of new or existing products and take additional measures to reduce expenses in order to conserve our cash in amounts sufficient to sustain operations and meet our obligations. Based on our current level of expenditures, we believe that we have sufficient resources such that there is not substantial doubt about our ability to continue operations for at least one year after the date that these financial statements are available to be issued.

Current wording

We expect to continue incurring losses in the future and will be required to raise additional capital in the future to complete our clinical trials, pursue product development initiatives and penetrate markets for the sale of our products. We believe that we will continue to have access to capital resources through possible equity offerings, debt financings, corporate collaborations or other means. There can be no assurance that we will be able to obtain additional financing on terms acceptable to us, on a timely basis or at all. If we are unable to secure additional capital, we may be required to curtail any clinical trials and development of new or existing products and take additional measures to reduce expenses in order to conserve our cash in amounts sufficient to sustain operations and meet our obligations. Based on our currently anticipated level of expenditures, we believe that current available cash will not be sufficient to fund planned expenditures and meet obligations through the end of the first quarter of 2026, and there is substantial doubt about our ability to continue as a going concern for one year after the date that these financial statements are available to be issued.

Previous wording

Net cash used in operating activities was $ 22.0 million for the nine months ended September 30, 2024. Cash used in operating activities was primarily due to the use of funds for development costs associated with our drug candidates, labor costs, consulting services, and other corporate expenditures for investor relations, compliance, and legal services.

Current wording

Net cash used in operating activities was $8.9 million for the three months ended March 31, 2025. Cash used in operating activities was primarily due to the use of funds for development costs associated with our drug candidates, labor costs, consulting services, and other corporate expenditures for investor relations, compliance, and legal services.

Previous wording

Net cash used in operating activities was $13.8 million for the nine months ended September 30, 2023. Cash used in operating activities was primarily due to the use of funds for development costs associated with our drug candidates, labor costs, consulting services, and other corporate expenditures for investor relations, compliance, and legal services.

Current wording

Net cash used in operating activities was $6.5 million for the three months ended March 31, 2024. Cash used in operating activities was primarily due to the use of funds for development costs associated with our drug candidates, labor costs, consulting services, and other corporate expenditures for investor relations, compliance, and legal services.

Previous wording

Net cash used in investing activities was $12,000 for the nine months ended September 30, 2023 and was due to the purchase of furniture and fixtures for our corporate office.

Current wording

Net cash used in investing activities was $16,000 for the three months ended March 31, 2025 and was due to the purchase of furniture and fixtures for our corporate office.

Previous wording

Net cash used in investing activities was $50,000 for the nine months ended September 30, 2024 and was due to the purchase of lab equipment.

Current wording

Net cash used in investing activities was $6,000 for the three months ended March 31, 2024 and was due to the purchase of furniture and fixtures for our corporate office.

Previous wording

Net cash provided by financing activities was $44.7 million during the nine months ended September 30, 2024 due primarily to the private placement financing agreement we signed on March 13, 2024 , partially offset by dividends paid to preferred stockholders.

Current wording

Net cash provided by financing activities was $2.5 million during the three months ended March 31, 2025 due primarily to the at the market public offering agreement we signed on November 13, 2024.

Previous wording

Net cash provided by financing activities was $27.7 million during the nine months ended September 30, 2023 due primarily to the private placement financing agreement we signed on March 3, 2023.

Current wording

Net cash provided by financing activities was $45.7 million during the three months ended March 31, 2024 due primarily to the private placement financing agreement we signed on March 13, 2024.

Previous wording

Our financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We consider our critical accounting policies and estimates to be related to revenue, research and development, stock-based compensation, debt and equity classification and warrant liabilities. There have been no other material changes to our critical accounting policies and estimates during the nine months ended September 30, 2024 from those used for the year ended December 31, 2023. The below policies represent our critical accounting policies.

Current wording

Our financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We consider our critical accounting policies and estimates to be related to revenue, research and development, stock-based compensation, debt and equity classification and warrant liabilities. There have been no other material changes to our critical accounting policies and estimates during the three months ended March 31, 2025, from those used for the year ended December 31, 2024. The policies below represent our critical accounting policies.

Previous wording

We implemented ASC 606, Revenue from Contracts with Customers. This included the development of new policies based on the five-step model provided in the new revenue standard, ongoing contract review requirements, and gathering of information provided for disclosures. We recognize revenue from product sales or services rendered when control of the promised goods are transferred to a counterparty in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods and services. To achieve this core principle, we apply the following five steps: identify the contract with the client, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to performance obligations in the contract and recognize revenues when or as we satisfy a performance obligation.

Current wording

We apply ASC 606, Revenue from Contracts with Customers, for our revenue recognition guidance. This includes the development of new policies based on the five-step model provided in the revenue standard, ongoing contract review requirements, and gathering of information provided for disclosures. We recognize revenue from product sales or services rendered when control of the promised goods is transferred to a counterparty in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods and services. To achieve this core principle, we apply the following five steps: identify the contract with the client, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to performance obligations in the contract and recognize revenues when or as we satisfy a performance obligation.

Previous wording

In conjunction with the issuance of Series A-1 Preferred Stock (see Note 10), we established a warrant liability as of March 3, 2023, representing the fair value of warrants that may be issued, subject to shareholder approval, upon conversion of the Series A-1 Preferred Stock. We account for these warrants as liabilities (in accordance with ASC 480,Distinguishing Liabilities from Equity) on the balance sheets as a result of certain redemption clauses that are not within the control of the Company. The warrant liabilities are initially measured at fair value, resulting in an implied discount on the related preferred stock financing arrangement (recognized as a partial offset to the carrying value of the Series A-1 Preferred Stock), and are remeasured at fair value each reporting period. Changes in the fair value of the warrant liabilities are recognized in earnings during each period. The warrant liabilities are measured using Level 3 fair value inputs. See Note 12 for a description of warrant liabilities and the related valuations.

Current wording

In conjunction with the issuance of Series A-1 Preferred Stock (see Note 8), we established a warrant liability as of March 3, 2023, representing the fair value of warrants that may be issued, subject to shareholder approval, upon conversion of the Series A-1 Preferred Stock. We account for these warrants as liabilities (in accordance with ASC 480) on the balance sheets as a result of certain redemption clauses that are not within the control of the Company. The warrant liabilities are initially measured at fair value, resulting in an implied discount on the related preferred stock financing arrangement (recognized as a partial offset to the carrying value of the Series A-1 Preferred Stock), and are remeasured at fair value each reporting period. Changes in the fair value of the warrant liabilities are recognized in earnings during each period. The warrant liabilities are measured using Level 3 fair value inputs. See Note 10 for a description of warrant liabilities and the related valuations.

Previous wording

We expense costs when incurred related to the research and development associated with the design, development and testing of product candidates, as well as acquisition of product candidates or compounds. Research and development expenses include fees paid to third parties to conduct certain research and development activities on our behalf, consulting costs, costs for laboratory supplies, product acquisition and license costs, certain payroll and personnel-related expenses, including salaries and bonuses, employee benefit costs and stock-based compensation expenses for our research and product development employees and allocated overheads, including information technology costs and utilities and expenses for issuance of shares pursuant to anti-dilution clause in the purchase of IPR&D technology. We expense both internal and external research and development expenses as they are incurred.

Current wording

We expense costs when incurred related to the research and development associated with the design, development and testing of product candidates, as well as acquisition of product candidates or compounds. Research and development expenses include fees paid to third parties to conduct certain research and development activities on our behalf, consulting costs, costs for laboratory supplies, product acquisition and license costs, certain payroll and personnel-related expenses, including salaries and bonuses, employee benefit costs and stock-based compensation expenses for our research and product development employees and allocated overheads, including information technology costs and utilities and expenses for issuance of shares pursuant to anti-dilution clause in the purchase of IPR&D technology. We expense both internal and external research and development expenses as incurred.