Fortress Biotech Inc

Previous wording

Our subsidiaries and partner companies that are pursuing development and/or commercialization of biopharmaceutical products and product candidates are: Avenue Therapeutics, Inc. (Nasdaq: ATXI, “Avenue”), Baergic Bio, Inc. (“Baergic,” a subsidiary of Avenue), Cellvation, Inc. (“Cellvation”), Checkpoint Therapeutics, Inc. (Nasdaq: CKPT, “Checkpoint”), Cyprium Therapeutics, Inc. (“Cyprium”), Helocyte, Inc. (“Helocyte”), Journey Medical Corporation (Nasdaq: DERM, “Journey” or “JMC”), Mustang Bio, Inc. (Nasdaq: MBIO, “Mustang”), Oncogenuity, Inc. (“Oncogenuity”) and Urica Therapeutics, Inc. (“Urica”).

Current wording

Our subsidiaries and partner companies that are pursuing development and/or commercialization of biopharmaceutical products and product candidates are: Avenue Therapeutics, Inc. (Nasdaq: ATXI, “Avenue”), Baergic Bio, Inc. (“Baergic,” a subsidiary of Avenue), Cellvation, Inc. (“Cellvation”), Checkpoint Therapeutics, Inc. (Nasdaq: CKPT, “Checkpoint”), Cyprium Therapeutics, Inc. (“Cyprium”), Helocyte, Inc. (“Helocyte”), Journey Medical Corporation (Nasdaq: DERM, “Journey” or “JMC”), Mustang Bio, Inc. (Nasdaq: MBIO, “Mustang”) and Oncogenuity, Inc. (“Oncogenuity”).

Previous wording

We are a “smaller reporting company,” meaning that either (i) the market value of our shares held by non-affiliates is less than $250 million or (ii) the market value of our shares held by non-affiliates is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year. We may continue to be a smaller reporting company if either (i) the market value of our shares held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year and the market value of our shares held by non-affiliates is less than $700 million. As a smaller reporting company, we chose to present only the two most recent fiscal years of audited financial statements in the 2023 Form 10-K, have reduced disclosure obligations regarding executive compensation and certain other matters, and smaller reporting companies are permitted to delay adoption of certain recent accounting.

Current wording

We are a “smaller reporting company,” meaning that either (i) the market value of our shares held by non-affiliates is less than $250 million or (ii) the market value of our shares held by non-affiliates is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year. We may continue to be a smaller reporting company if either (i) the market value of our shares held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year and the market value of our shares held by non-affiliates is less than $700 million. As a smaller reporting company, we chose to present only the two most recent fiscal years of audited financial statements in the 2023 Form 10-K, have reduced disclosure obligations regarding executive compensation and certain other matters, and smaller reporting companies are permitted to delay adoption of certain recently issued accounting pronouncements.

Previous wording

The following table summarizes the Company’s basic ownership of the issued and outstanding common and preferred shares in consolidated Fortress subsidiaries as of the period presented:

Current wording

The following table summarizes the Company’s ownership of the issued and outstanding common and preferred shares in certain consolidated Fortress subsidiaries as of the period presented:

Previous wording

Collaboration revenue related to Cyprium’s agreement with Sentynl was fully recognized as of December 31, 2023 due to Sentynl’s assumption of control of the CUTX-101 development program in December 2023.

Current wording

For the quarter ended June 30, 2024, the net decrease in revenue of $2.5 million or 14% is due to Journey’s$2.1 million or 12% decrease in product revenue due primarily to a $1.2 million decrease in net product revenue from Qbrexza and a $0.6 million decrease in net product revenue from legacy products. Collaboration revenue related to Cyprium’s agreement with Sentynl was fully recognized as of December 31, 2023 due to Sentynl’s assumption of control of the CUTX-101 development program in December 2023.

Previous wording

We had $6.8 million and $6.4 million of costs of goods sold in connection with the sale of JMC branded and generic products for the quarters ended March 31, 2024 and 2023, respectively. Cost of goods sold increased by $0.4 million, or 6% year-over-year, with the increase mainly due to the increase in product revenue.

Current wording

We had $6.5 million and $7.8 million of costs of goods sold in connection with the sale of JMC branded and generic products for the quarters ended June 30, 2024 and 2023, respectively. Cost of goods sold decreased by $1.2 million, or 16% quarter-over-quarter, with the decrease mainly due to the decrease in net product revenue.

Previous wording

For the quarters ended March 31, 2024 and 2023, research and development expenses were approximately $24.8 million and $35.3 million, respectively. The table below provides a summary of research and development by entity, for the periods presented:

Current wording

For the quarters ended June 30, 2024 and 2023, research and development expenses were approximately $12.7 million and $32.1 million, respectively. The table below provides a summary of research and development by entity, for the periods presented:

Previous wording

Selling, general and administrative expenses consist principally of personnel related costs, costs required to support the marketing and sales of our commercialized products, professional fees for legal, consulting, audit and tax services, rent and other general operating expenses not otherwise included in research and development expenses. For the three months ended March 31, 2024 and 2023, selling, general and administrative expenses were $17.9 million and $25.3 million, respectively. The table below provides a summary by entity of selling, general and administrative expenses for the periods presented:

Current wording

Selling, general and administrative expenses consist principally of personnel related costs, costs required to support the marketing and sales of our commercialized products, professional fees for legal, consulting, audit and tax services, rent and other general operating expenses not otherwise included in research and development expenses. For the three months ended June 30, 2024 and 2023, selling, general and administrative expenses were $20.8 million and $24.4 million, respectively. The table below provides a summary by entity of selling, general and administrative expenses for the periods presented:

Previous wording

For the three months ended March 31, 2024, the decrease in selling, general and administrative expenses of $7.4 million or 29% is primarily attributable to decreased expenses at Journey related to its expense reduction efforts in sales and marketing, as JMC has undertaken a cost reduction initiative designed to improve operational efficiencies, optimize expenses and reduce overall costs to better align costs to their revenue-generating capabilities. The decrease in selling, general and administrative costs at Fortress and Mustang is attributable to continued cost reduction efforts and optimization relating to personnel, consulting, and infrastructure. The decrease in “Other” is due to the transition of the CUTX-101 development program from Cyprium to Sentynl in December, 2023.

Current wording

For the three months ended June 30, 2024, the decrease in selling, general and administrative expenses of $3.6 million or 15% is primarily attributable to decreased expenses at Fortress related to cost-reduction and optimization efforts and at Journey related to its expense reduction efforts in sales and marketing, as JMC has undertaken a cost reduction initiative designed to improve operational efficiencies, optimize expenses and reduce overall costs to better align costs to their revenue-generating capabilities. The decrease in selling, general and administrative costs at Mustang is attributable to continued cost reduction efforts and optimization relating to personnel, consulting, and infrastructure. The increase in “Other” is due to an increase in professional fees, including legal expense, at Urica of $0.7 million.

Previous wording

For the three months ended March 31, 2024 we generated $13.0 million of net revenue related to the sale of Journey’s branded and generic products. For the three months ended March 31, 2023, we generated $12.4 million of net revenue, of which $12.2 million relates to the sale of Journey’s branded and generic products, $48,000 relates to Journey’s royalties from Maruho, $0.2 million relates to Cyprium’s collaboration revenue with Sentynl and $35,000 relates to Checkpoint’s collaborative revenue from TGTX.

Current wording

For the six months ended June 30, 2024 we generated $27.9 million of net revenue related to the sale of Journey’s branded and generic products. For the six months ended June 30, 2023, we generated $29.8 million of net revenue, of which $29.1 million relates to the sale of Journey’s branded and generic products, $0.3 relates to Journey’s royalties from Maruho, $0.4 million relates to Cyprium’s collaboration revenue with Sentynl and $0.1 relates to Checkpoint’s collaborative revenue from TGTX.

Previous wording

The decrease in research and development spending at Mustang of $10.2 million is due to a reduction in personnel-related costs of $5.8 million, $2.7 million reduction in lab supplies, $1.0 million decrease in program-related expenses, $0.5 million decrease in facility and depreciation, and $0.2 million reduction in consulting expense. Checkpoint’s reduced research and development expense of $7.3 million is due to the timing of its BLA submission in the three months ended March 31, 2023, and a milestone payment due as a result of the BLA filing, with no comparable expenses in the current quarter. Journey’s increased research and development costs are due to the $4.0 million filing fee payment made to the FDA in January 2024 for the DFD-29 NDA in addition to the accrued $3.0 million expense for the contractual milestone payment owed to Dr. Reddy’s Laboratories, Ltd. triggered by the FDA’s acceptance of the DFD-29 product NDA in March 2024. This was partially offset by lower clinical trial expenses incurred by Journey to develop DFD-29 product as the project concludes. Avenue’s increase in research and development in the quarter ended March 31, 2024 is primarily attributable to clinical costs related to the Phase 1b/2a of AJ201.

Current wording

The decrease in research and development spending at Mustang of $16.6 million is due to a reduction in personnel-related costs of $10.9 million, $4.9 million reduction in lab supplies, $2.4 million decrease in program-related expenses, $1.4 million decrease in facility and depreciation, and $1.2 million reduction in consulting expense, offset by a $4.0 million increase in other expenses, of which approximately $3.2 million of expenses incurred related to the June 2024 Repurchase of Assets from uBriGene. Checkpoint’s reduced research and development expense of $16.8 million is due to reduced commercial manufacturing costs for cosibelimab of $10.6 million due to manufacturing costs incurred in the prior period to build inventory to support a potential product launch of cosibelimab, reduced regulatory expenses of $3.5 million as prior period costs included $3.2 million for the PDUFA fee to the FDA for the BLA filing of cosibelimab in the first quarter of 2023, and a $1.6 million decrease in clinical costs for product candidates. Journey’s increased research and development costs are due to the $4.0 million filing fee payment made to the FDA in January 2024 for the DFD-29 NDA in addition to the $3.0 million contractual milestone payment made to Dr. Reddy’s Laboratories, Ltd. triggered by the FDA’s acceptance of the DFD-29 NDA in March 2024. This was partially offset by lower clinical trial expenses incurred by Journey to develop DFD-29 product as the project concludes.

Previous wording

Noncash, stock-based compensation expense included in research and development for the three months ended March 31, 2024 and 2023, was $1.1 million and $0.9 million, respectively.

Current wording

Noncash, stock-based compensation expense included in research and development for the six months ended June 30, 2024 and 2023, was $1.7 million and $1.5 million, respectively.

Previous wording

We will require additional financing to fully develop and prepare regulatory filings and obtain regulatory approvals for our existing and new product candidates, fund operating losses, and, if deemed appropriate, establish or secure through third parties manufacturing for our potential products, and sales and marketing capabilities. We have funded our operations to date primarily through the sale of equity and debt securities. At March 31, 2024, we had cash and cash equivalents of $83.8 million, of which $43.9 million relates to Fortress and private subsidiaries, primarily funded by Fortress, $11.2 million relates to Checkpoint, $1.3 million relates to Mustang, $24.1 million relates to Journey, and $3.2 million relates to Avenue. We believe that our current cash and cash equivalents are sufficient to fund operations for at least the next 12 months. Our failure to raise capital as and when needed would have a material adverse impact on our financial condition and our ability to pursue our business strategies. We may seek funds through equity or debt financings, joint venture or similar development collaborations, the sales of subsidiaries/partner companies, royalty financings, or through other sources of financing; the rising interest rate environment may cause the Company to pay more interest on its various debt instruments, which could lead to higher operating expenses.

Current wording

We will require additional financing to fully develop and prepare regulatory filings and obtain regulatory approvals for our existing and new product candidates, fund operating losses, and, if deemed appropriate, establish or secure through third parties manufacturing for our potential products, and sales and marketing capabilities. We have funded our operations to date primarily through the sale of equity and debt securities. At June 30, 2024, we had cash and cash equivalents of $76.2 million, of which $38.2 million relates to Fortress and private subsidiaries, primarily funded by Fortress, $5.0 million relates to Checkpoint, $4.3 million relates to Mustang, $23.9 million relates to Journey, and $4.9 million relates to Avenue. We believe that our current cash and cash equivalents are sufficient to fund operations for at least the next 12 months. Our failure to raise capital as and when needed would have a material adverse impact on our financial condition and our ability to pursue our business strategies. We may seek funds through equity or debt financings, joint venture or similar development collaborations, the sales of subsidiaries/partner companies, royalty financings, or through other sources of

Previous wording

Cash Flows for the Three Months Ended March 31, 2024 and 2023

Current wording

Cash Flows for the Six Months Ended June 30, 2024 and 2023

Previous wording

Net cash used in operating activities decreased $17.8 million from the three months ended March 31, 2023, as compared to the three months ended March 31, 2024. The decrease is due to the decrease of $16.1 million in net loss, the $6.8 million decrease in cash effect of the change in fair value of subsidiaries/partner companies’ warrant liabilities, and the $0.5 million decrease resulting from changes in operating assets and liabilities, offset in part by the $4.2 million change in the expense for research and development – licenses acquired.

Current wording

Net cash used in operating activities decreased $29.3 million from the six months ended June 30, 2023, as compared to the six months ended June 30, 2024. The decrease is due to the decrease of $46.6 million in net loss, the $6.6 million decrease in the expense associated with subsidiaries/partner companies’ warrant liabilities, and the $11.4 million decrease resulting from changes in operating assets and liabilities, offset in part by the $3.0 million change in the expense for research and development – licenses acquired, $3.4 million change in the expense for loss form deconsolidation and dissolution of subsidiaries, and $2.9 million for Journey’s asset impairment loss in the prior period.

Previous wording

Net cash used in investing activities for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023 showed a decrease of $5.0 million, due to JMC’s $5.0 million used in investing activities for the three months ended March 31, 2023 for the deferred cash payment made to VYNE related to the acquisition of Amzeeq and Zilxi.

Current wording

Net cash used in investing activities for the six months ended June 30, 2024 as compared to the six months ended June 30, 2023 is a decrease of $7.0 million, due to JMC’s $5.0 million used in investing activities for the deferred cash payment made to VYNE related to the acquisition of Amzeeq and Zilxi, and Avenue’s $2.0 million cash payment towards the purchase of the AnnJi license in the six months ended June 30, 2023, and no comparable activities in the period ended June 30, 2024.

Previous wording

Net cash provided by financing activities was $22.2 million for the three months ended March 31, 2023, compared to $27.9 million of net cash provided by financing activities for the three months ended March 31, 2024, an increase of $5.7 million. The increase is attributable to the increase in net proceeds from subsidiaries’/partner companies’ sale of stock and warrants of $7.5 million, offset by a decrease of $3.2 million in proceeds from the issuance of stock in a public offering.

Current wording

Net cash used in financing activities was $8.2 million for the six months ended June 30, 2023, compared to $42.1 million of net cash provided by financing activities for the six months ended June 30, 2024, an increase of $50.3 million. The increase is attributable to the funds used in the prior period to pay off partner companies’ long-term debt of $40.3 million and JMC’s line of credit of $30.9 million, offset by loan proceeds of $5.1 million in the current period.

Previous wording

We fund our operations through cash on hand, the sale of equity and debt securities, from the sales of subsidiaries/partner companies, and from the proceeds resulting from the exercise of warrants and stock options. At March 31, 2024, we had cash and cash equivalents of $83.8 million, of which $43.9 million relates to Fortress and private subsidiaries, primarily funded by Fortress, $11.2 million relates to Checkpoint, $1.3 million relates to Mustang, $24.1 million relates to Journey, and $3.2 million relates to Avenue. Restricted cash at March 31, 2024 was $2.1 million, of which $1.2 million relates to Fortress, $0.4 million relates to Mustang, and $0.5 million relates to Cyprium.

Current wording

We fund our operations through cash on hand, the sale of equity and debt securities, from the sales of subsidiaries/partner companies, and from the proceeds resulting from the exercise of warrants and stock options. At June 30, 2024, we had cash and cash equivalents of $76.2 million, of which $38.2 million relates to Fortress and private subsidiaries, primarily funded by Fortress, $5.0 million relates to Checkpoint, $4.3 million relates to Mustang, $23.9 million relates to Journey, and $4.9 million relates to Avenue. Restricted cash at June 30, 2024 was $2.1 million, of which $1.2 million relates to Fortress, $0.4 million relates to Mustang, and $0.5 million relates to Cyprium.

Previous wording

On July 23, 2021, the Company filed a shelf registration statement (File No. 333-258145) on Form S-3, which was declared effective on July 30, 2021 (the “2021 Shelf”). Approximately $88.2 million of securities remain available for sale under the 2021 Shelf as of March 31, 2024.

Current wording

On July 23, 2021, the Company filed a shelf registration statement (File No. 333-258145) on Form S-3, which was declared effective on July 30, 2021 (the “2021 Shelf”). Approximately $86.2 million of securities remain available for sale under the 2021 Shelf as of June 30, 2024, subject to General Instruction I.B.6. of Form S-3. On May 17, 2024, the Company filed a shelf registration statement (File No. 333-279516) on Form S-3, which was declared effective on May 30, 2024 (the “2024 Shelf”). All $50.0 million of securities remain available for sale under the 2024 Shelf as of June 30, 2024, subject to General Instruction I.B.6. of Form S-3.

Previous wording

For the three-month period ended March 31, 2024, the Company issued and sold approximately 0.5 million shares at an average price of $1.99 per share for gross proceeds of $0.9 million pursuant to the Company’s at-the-market program. For the three-month period ended March 31, 2023 the Company issued and sold approximately 40,000 shares at an average price of $11.43 per share for gross proceeds of $0.5 million.

Current wording

For the six-month period ended June 30, 2024, the Company issued and sold approximately 1.6 million shares at an average price of $1.87 per share for gross proceeds of $2.9 million pursuant to the Company’s at-the-market program.

Previous wording

In January 2024, Fortress closed on a registered direct offering for the issuance and sale of an aggregate of 3,303,305 shares of its common stock and warrants to purchase up to 3,303,305 shares of its common stock at a combined purchase price of $3.33 per share of common stock and accompanying warrant priced at-the-market under Nasdaq rules. The warrants have an exercise price of $3.21 per share, are immediately exercisable, and will expire five years following the date of issue. Net proceeds to Fortress, after deducting the placement agent’s fees and other offering expenses, were approximately $10.2 million.

Current wording

In January 2024, Fortress closed on a registered direct offering of 3,303,305 shares of its common stock and warrants to purchase up to 3,303,305 shares of its common stock at a combined purchase price of $3.33 per share of common stock and accompanying warrant priced at-the-market under Nasdaq rules. The warrants have an exercise price of $3.21 per share, are immediately exercisable, and will expire five years following the date of issue. Net proceeds to Fortress, after deducting the placement agent’s fees and other offering expenses, were approximately $10.2 million.

Previous wording

In March 2023, Checkpoint filed shelf registration statement (File No. 333-270843) on Form S-3 (the “Checkpoint 2023 S-3”), which was declared effective May 5, 2023. Under the Checkpoint 2023 S-3, Checkpoint may sell up to a total of $150 million of its securities. As of March 31, 2024, approximately $77.7 million of the securities remains available for sale through the Checkpoint 2023 S-3.

Current wording

In March 2023, Checkpoint filed shelf registration statement (File No. 333-270843) on Form S-3 (the “Checkpoint 2023 S-3”), which was declared effective May 5, 2023. Under the Checkpoint 2023 S-3, Checkpoint may sell up to a total of $150 million of its securities. As of June 30, 2024, approximately $77.7 million of the securities remains available for sale through the Checkpoint 2023 S-3, subject to General Instruction I.B.6. of Form S-3.

Previous wording

In January 2024, Checkpoint closed on a registered direct offering (the “Checkpoint January 2024 Registered Direct Offering”) with a single institutional investor for the issuance and sale of 1,275,000 shares of its common stock and 6,481,233 pre-funded warrants. Each pre-funded warrant was exercisable for one share of Checkpoint common stock. The Checkpoint common stock and the pre-funded warrants were sold together with common stock warrants (the “Checkpoint January 2024 Common Warrants”) to purchase up to 7,756,233 shares of Checkpoint common stock, at a purchase price of $1.805 per share of common stock and $1.8049 per pre-funded warrant. The pre-funded warrants were funded in full at closing except for a nominal exercise price of $0.0001 and are exercisable commencing on the closing date and will terminate when such pre-funded warrants are exercised in full. The Checkpoint January 2024 Common Warrants are exercisable immediately upon issuance and will expire five years following the issuance date and have an exercise price of $1.68 per share. Checkpoint also issued the placement agent warrants to purchase up to 465,374 shares of common stock with an exercise price of $2.2563 per share. Net proceeds to Checkpoint from the Checkpoint January 2024 Registered Direct Offering were $12.8 million after deducting commissions and other transaction costs. As of May 7, 2024, 3,825,233 pre-funded warrants from the Checkpoint January 2024 Registered Direct Offering were fully exercised.

Current wording

In January 2024, Checkpoint closed on a registered direct offering (the “Checkpoint January 2024 Registered Direct Offering”) with a single institutional investor for the issuance and sale of 1,275,000 shares of its common stock and 6,481,233 pre-funded warrants. Each pre-funded warrant was exercisable for one share of Checkpoint common stock. The Checkpoint common stock and the pre-funded warrants were sold together with common stock warrants (the “Checkpoint January 2024 Common Warrants”) to purchase up to 7,756,233 shares of Checkpoint common stock, at a purchase price of $1.805 per share of common stock and $1.8049 per pre-funded warrant. The pre-funded warrants were funded in full at closing except for a nominal exercise price of $0.0001 and are exercisable commencing on the closing date and will terminate when such pre-funded warrants are exercised in full. The Checkpoint January 2024 Common Warrants are exercisable immediately upon issuance and will expire five years following the issuance date and have an exercise price of $1.68 per share. Checkpoint also issued the placement agent warrants to purchase up to 465,374 shares of common stock with an exercise price of $2.2563 per share. Net proceeds to Checkpoint from the Checkpoint January 2024 Registered Direct Offering were $12.6 million after deducting commissions and other transaction costs. As of July 2024, all of the pre-funded warrants from the Checkpoint January 2024 Registered Direct Offering were fully exercised.

Previous wording

In December 2021, Avenue filed a shelf registration statement (File No. 333-261520) on Form S-3 (the “Avenue 2021 S-3”), which was declared effective on December 10, 2021. As of March 31, 2024, approximately $24.9 million of the securities remains available for sale through the Avenue 2021 S-3, subject to General Instruction I.B.6. of Form S-3.

Current wording

In December 2021, Avenue filed a shelf registration statement (File No. 333-261520) on Form S-3 (the “Avenue 2021 S-3”), which was declared effective on December 10, 2021. As of June 30, 2024, approximately $24.6 million of the securities remains available for sale through the Avenue 2021 S-3, subject to General Instruction I.B.6. of Form S-3.

Previous wording

On April 23, 2021, Mustang filed a shelf registration statement (File No. 333-255476) on Form S-3 (the “Mustang 2021 S-3”), which was declared effective on May 24, 2021. Under the Mustang 2021 S-3, Mustang may sell up to a total of $200 million of its securities. As of March 31, 2024, approximately $195.6 million of the Mustang 2021 S-3 remained available for sales of securities. The Mustang 2021 S-3 expires on May 24, 2024.

Current wording

On May 31, 2024, Mustang filed a shelf registration statement on Form S-3 (File No. 333-279891) (the “Mustang 2024 S-3”), which was declared effective on June 12, 2024. Under the Mustang 2024 S-3, Mustang may sell up to a total of $40.0 million of its securities. As of June 30, 2024, approximately $37.5 million of the Mustang 2024 S-3 remains available for sales of securities. The Mustang 2024 S-3 expires on June 12, 2027. As of the filing of this Form 10-Q, Mustang is subject to the General Instruction I.B.6 to Form S-3, known as the “baby shelf rules,” which limit the number of securities it can sell under its registration statements on Form S-3.

Previous wording

On December 30, 2022, Journey filed a shelf registration statement on Form S-3 (File No. 333-269079) (the “Journey 2022 S-3”), which was declared effective on January 26, 2023. The Journey 2022 S-3 covers the offering, issuance and sale by Journey of up to an aggregate of $150.0 million of Journey’s common stock, preferred stock, debt securities, warrants, and units. In connection with the Journey 2022 S-3, Journey has entered into the Sales Agreement relating to shares of the Journey’s common stock. In accordance with the terms of the Sales Agreement, Journey may offer and sell up to 4,900,000 shares of its common stock, par value $0.0001 per share, from time to time. For the three months ended March 31, 2024, Journey issued and sold approximately 0.3 million shares of common stock at an average price of $5.28 per share for gross proceeds of $1.5 million under the Journey ATM. In connection with these sales, Journey paid aggregate fees of approximately $46,000. At March 31, 2024, 3,861,553 shares remain available for issuance under the Journey 2022 S-3.

Current wording

On December 30, 2022, Journey filed a shelf registration statement on Form S-3 (File No. 333-269079) (the “Journey 2022 S-3”), which was declared effective on January 26, 2023. The Journey 2022 S-3 covers the offering, issuance and sale by Journey of up to an aggregate of $150.0 million of Journey’s common stock, preferred stock, debt securities, warrants, and units. In connection with the Journey 2022 S-3, Journey has entered into the Sales Agreement relating to shares of the Journey’s common stock. In accordance with the terms of the Sales Agreement, Journey may offer and sell up to 4,900,000 shares of its common stock, par value $0.0001 per share, from time to time. For the six months ended June 30, 2024, Journey issued and sold approximately 0.3 million shares of common stock at an average price of $5.28 per share for gross proceeds of $1.5 million under the Journey ATM. In connection with these sales, Journey paid aggregate fees of approximately $46,000. At June 30, 2024, 3,861,553 shares remain available for issuance under the Journey 2022 S-3.

Previous wording

During the three months ended March 31, 2024, there were no material changes in our contractual obligations and commitments, including our lease obligations, as described in our 2023 Form 10-K.

Current wording

During the six months ended June 30, 2024, there were no material changes in our contractual obligations and commitments, including our lease obligations, as described in our 2023 Form 10-K.