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Stockholders' Equity | 12 Months Ended
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Dec. 31, 2025
Stockholders' Equity Note [Abstract] |
Stockholders' Equity | NOTE 4—STOCKHOLDERS’ EQUITY Common Stock and Preferred Stock Common Stock The Company’s Certificate of Incorporation, as amended, authorizes it to issue 400,000,000 shares of $0.0001 par value common stock. As of December 31, 2025, and December 31, 2024, there were 9,314,130 and 3,420,906 shares of common stock issued and outstanding, respectively. Preferred Stock Under the Company’s Certificate of Incorporation, as amended, the Board of Directors is authorized, without further stockholder action, to provide for the issuance of up to 10,000,000 shares of preferred stock, par value $0.0001 per share, in one or more series, to establish from time to time the number of shares to be included in each such series, and to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations and restrictions thereof. Of the potential 10,000,000 shares of preferred stock, 5,181,346 are designated as Series A Stock and 4,818,654 remain undesignated. As of December 31, 2025 and 2024, there were 210 shares of Series A Stock outstanding, convertible into an aggregate of one share of common stock. Common Stock and Pre-Funded Warrants March 2025 Private Placement Financing (the “March 2025 Offering”) On March 4, 2025, the Company entered into a securities purchase agreement with certain accredited investors for the purchase and sale, in a private placement financing by the Company, of an aggregate of 378,346 shares of its common stock, and pre-funded warrants to purchase an aggregate of 3,760,726 shares of common stock at an offering price of $6.04 per share of common stock and $6.03 per pre-funded warrant, resulting in gross proceeds of $25.0 million. The pre-funded warrants do not expire and have an exercise price of $0.01. The net proceeds of the March 2025 Offering, after deducting placement agent fees and direct offering expenses were $23.2 million. The relative fair value allocated to the common stock and pre-funded warrants was $2.3 million and $22.7 million, respectively. Also, on March 5, 2025 and in connection with the March 2025 Offering, the Company entered into a registration rights agreement (the “March 2025 Registration Rights Agreement”) with the purchasers, pursuant to which the Company agreed to register for resale the shares of common stock issued in the March 2025 Offering and the shares of common stock issuable upon exercise of the pre-funded warrants issued in the March 2025 Offering within 45 days of the closing date. Pursuant to the March 2025 Registration Rights Agreement, on April 15, 2025, the Company filed a resale registration statement on Form S-3 with the SEC, which went effective on April 23, 2025. The March 2025 Registration Rights Agreement includes liquidated damages provisions that meet the definition of a registration payment arrangement that is within the scope of ASC 825-20. The Company determined at the initial issuance of the pre-funded warrants that it is not probable that a payment would be required as it has both the intent and ability to satisfy the March 2025 Registration Rights Agreement. Therefore, the Company did not record a liability at inception but will evaluate the contingency at each reporting period. As of December 31, 2025, no events had occurred that would change our initial assessment of this provision. August 2024 Private Placement Financing (the “August 2024 Offering”) On August 6, 2024, the Company entered into a securities purchase agreement with certain accredited investors for the purchase and sale, in a private placement financing by the Company, of (i) an aggregate of 1,450,661 shares of its common stock and pre-funded warrants to purchase an aggregate of 31,882,671 shares of common stock and (ii) accompanying warrants to purchase up to an aggregate of 16,666,666 shares of its common stock (or, in lieu thereof, additional pre-funded warrants) at a combined offering price of $3.00 per share of common stock and accompanying warrant, or $2.99 per pre-funded warrant and accompanying warrant, resulting in gross proceeds of $99.7 million. The pre-funded warrants do not expire and have an exercise price of $0.01. The net proceeds of the August 2024 Offering after deducting placement agent fees and direct offering expenses were $92.3 million. The relative fair value allocated to the common stock, pre-funded warrants, and warrants was $3.2 million, $69.4 million, and $27.1 million, respectively. Also, on August 6, 2024 and in connection with the August 2024 Offering, the Company entered into a registration rights agreement (the “August 2024 Registration Rights Agreement”) with the purchasers, pursuant to which the Company agreed to register for resale the shares of common stock issued in the August 2024 Offering and the shares of common stock issuable upon exercise of the warrants issued in the August 2024 Offering within 60 days following the effective date of the August 2024 Registration Rights Agreement. Pursuant to the August 2024 Registration Rights Agreement, on August 30, 2024, the Company filed a resale registration statement on Form S-3 with the SEC, which went effective on September 12, 2024. The August 2024 Registration Rights Agreement includes liquidated damages provisions that meet the definition of a registration payment arrangement that is within the scope of ASC 825-20. The Company determined at the initial issuance of the pre-funded warrants and accompanying warrant that it is not probable that a payment would be required as it has both the intent and ability to satisfy the August 2024 Registration Rights Agreement. Therefore, the Company did not record a liability at inception but will evaluate the contingency at each reporting period. As of December 31, 2025 no events have occurred that would change our initial assessment of this provision. February 2024 Registered Public Offering (the “February 2024 Offering”) On February 8, 2024, the Company entered into a securities purchase agreement with certain purchasers for the purchase and sale, in a registered public offering by the Company, of (i) an aggregate of 421,260 shares of its common stock and pre-funded warrants to purchase an aggregate of 1,178,740 shares of common stock and (ii) accompanying warrants to purchase up to an aggregate of 3,200,000 shares of its common stock at a combined offering price of $5.65 per share of common stock and associated warrant, or $5.649 per pre-funded warrant and associated warrant, resulting in gross proceeds of $9.0 million. The net proceeds of the February 2024 Offering after deducting placement agent fees and direct offering expenses were $8.0 million. The relative fair value allocated to the common stock, pre-funded warrants and warrants was $0.9 million, $2.4 million, and $5.7 million, respectively. Pre-Funded Warrants Activity The following table summarizes the Company’s pre-funded warrant activity for the years ended December 31, 2025 and 2024:
|  | Prefunded Warrants |  |  | Weighted Average Exercise Price |
Outstanding at December 31, 2023 |  |  | - |  |  | $ | — |
Issued |  |  | 33,061,411 |  |  |  | 0.01 |
Exercised |  |  | (1,178,740 | ) |  |  | 0.01 |
Canceled |  |  | - |  |  |  | — |
Outstanding at December 31, 2024 |  |  | 31,882,671 |  |  | $ | 0.01 |
Issued |  |  | 3,760,726 |  |  |  | 0.01 |
Exercised |  |  | (2,538,799 | ) |  |  | 0.01 |
Canceled |  |  | (1,820 | ) |  |  | 0.01 |
Outstanding at December 31, 2025 |  |  | 33,102,778 |  |  | $ | 0.01 |
Warrants The following table summarizes the Company’s warrant activity for the years ended December 31, 2025 and 2024, not including pre-funded warrants:
|  | Warrants |  |  | Weighted Average Exercise Price |
Outstanding at December 31, 2023 |  |  | 19,694 |  |  | $ | 1,095.27 |
Issued |  |  | 19,866,666 |  |  |  | 4.69 |
Exercised |  |  | (12,000 | ) |  |  | 5.65 |
Canceled |  |  | — |  |  |  | — |
Outstanding at December 31, 2024 |  |  | 19,874,360 |  |  | $ | 5.77 |
Issued |  |  | — |  |  |  | — |
Exercised |  |  | (2,976,079 | ) |  |  | 5.14 |
Canceled/Expired |  |  | (3,170 | ) |  |  | 1,151.33 |
Outstanding at December 31, 2025 |  |  | 16,895,111 |  |  | $ | 5.66 |
August 2024 Warrants As described above, as part of the August 2024 Offering, the Company issued unregistered warrants to purchase 16,666,666 shares of its common stock at an exercise price of $4.50 per share. The warrants expire at the earlier of (i) 30 trading days following the date of the Company’s initial public announcement of topline data from its Phase 3 LEVEL trial (the “Topline Data Announcement”), (ii) immediately upon the exercise of the August 2024 pre-funded warrants if such exercise is prior to the Topline Data Announcement, provided that if the pre-funded warrant is not exercised in full, the warrant expires proportionally to the extent the pre-funded warrant is exercised, and (iii) August 8, 2029. The warrants have an estimated term of 1.8 years. The unregistered warrants were offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) and Regulation D promulgated thereunder. In accordance with ASC 815, Derivatives and Hedging, these warrants are classified as equity and their relative fair value of $27.1 million was recognized as additional paid in capital. The estimated fair value is determined using the Black-Scholes option pricing model using the following assumptions: remaining estimated term of 1.8 years, risk free interest rate of 3.83%, expected dividends of zero, and expected volatility of 177.27%. February 2024 Warrants As described above, as a part of the February 2024 Offering, the Company issued registered warrants to purchase 3,200,000 shares of its common stock at an exercise price of $5.65 per share and contractual term of five years. In accordance with ASC 815, Derivatives and Hedging, these warrants are classified as equity and their relative fair value of $5.7 million was recognized as additional paid in capital. The estimated fair value was determined using the Black-Scholes option pricing model using the following assumptions: remaining estimated term of 5.0 years, risk free interest rate of 4.12%, expected dividends of zero, and expected volatility of 131.87%. Stock-Based Compensation Stock Incentive Plans In June 2022, the Company adopted the 2022 Stock Incentive Plan, as amended on June 7, 2024 and October 25, 2024, (the “2022 Plan”), with the outstanding shares available for future grants under prior plans, as well as outstanding awards under prior plans that subsequently expire, terminate or are surrendered or forfeited, generally being assumed by the 2022 Plan. Unexpired awards granted under certain prior plans may be subject to the terms of such prior plans. Under the 2022 Plan, with the approval of the Board of Director’s Compensation Committee, the Company may grant stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units, cash-based awards or other stock-based awards. Stock options granted under the 2022 Plan may be either incentive stock options (“ISOs”) or nonqualified stock options (“NSOs”). ISOs may be granted only to employees. NSOs may be granted to employees, consultants and directors. Stock options under the 2022 Plan may be granted with a term of up to ten years and at prices no less than fair market value at the time of grant. Stock options granted generally vest over one to four years. The number of shares of common stock authorized for issuance under the 2022 Plan is 8,337,252 shares and a total o f 1,721,121 shares remained available for issuance as of December 31, 2025. Summary of Stock Option Activity Transactions during the years ended December 31, 2025 and 2024 related to stock options granted to employees and directors under Company option plans were as follows:
|  | Shares |  |  | Weighted average exercise price per Share |  |  | Weighted average remaining contractual life (years) |  |  | Aggregate intrinsic value (in thousands) |
Options outstanding as of December 31, 2023 |  |  | 646 |  |  | $ | 4,509.71 |  |  |  | 7.42 |  |  | $ | - |
Granted |  |  | 3,125,794 |  |  |  | 5.94 |  |  |  |  |  |  |
Exercised |  |  | - |  |  |  | - |  |  |  |  |  |  |
Canceled or forfeited |  |  | (4 | ) |  |  | 159,600.00 |  |  |  |  |  |  |
Options outstanding as of December 31, 2024 |  |  | 3,126,436 |  |  | $ | 6.66 |  |  |  | 9.95 |  |  | $ | 783 |
Granted |  |  | 3,490,000 |  |  |  | 5.93 |  |  |  |  |  |  |
Exercised |  |  | - |  |  |  | - |  |  |  |  |  |  |
Canceled or forfeited |  |  | (4 | ) |  |  | 107,360.00 |  |  |  |  |  |  |
Options outstanding as of December 31, 2025 |  |  | 6,616,432 |  |  | $ | 6.21 |  |  |  | 9.19 |  |  | $ | 41,382 |
Options exercisable at December 31, 2025 |  |  | 3,125,754 |  |  | $ | 6.50 |  |  |  | 8.95 |  |  | $ | 19,533 |
The following table summarizes all options issued under the Company's stock plans that are outstanding as of December 31, 2025:
|  |  |  |  |  | Options Outstanding at December 31, 2025 |  |  | Options Exercisable and Vested at December 31, 2025 |
Exercise Price |  |  |  |  |  | Number of Options |  |  | Weighted Average Remaining Contractual Life (Years) |  |  | Number of Options |  |  | Weighted Average Exercise Price |
$ | 3.55 |  | to | $ | 7.10 |  |  |  | 6,615,794 |  |  |  | 9.2 |  |  |  | 3,125,196 |  |  | $ | 5.94 |
$ | 992.00 |  | to | $ | 87,040.00 |  |  |  | 638 |  |  |  | 5.4 |  |  |  | 558 |  |  | $ | 3,148.70 |
|  |  |  |  |  |  | 6,616,432 |  |  |  | 9.2 |  |  |  | 3,125,754 |  |  | $ | 6.50 |
The Company used the following assumptions to estimate the fair value of options granted for the year ended December 31, 2025.
|  | For the year ended December 31, |
|  | 2025 |  |  | 2024 |
Risk-free interest rate (weighted average) |  |  | 4.18 | % |  |  | 4.09 | %
Expected volatility (weighted average) |  |  | 122.16 | % |  |  | 131.33 | %
Expected term (in years) |  |  | 5.9 |  |  |  | 5.0 |
Expected dividend yield |  |  | 0.00 | % |  |  | 0.00 | %
The Company recorded compensation expense for non-inducement stock options of $18.8 million and $1.0 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, there were unrecognized compensatio n costs of $14.7 million rela ted to non-vested stock option awards that will be recognized on a straight-line basis over the weighted average remaining vesting period of 1.47 years. Inducement Stock Options The Company granted an employment inducement stock option award for 250,000 shares of common stock to a new employee on January 21, 2025. This employment inducement stock option was awarded in accordance with the employment inducement award exemption provided by Nasdaq Listing Rule 5635(c)(4) and was therefore not awarded under the Company’s stockholder approved equity plan. The option award vests in four equal annual installments beginning on the first anniversary of the date of issuance, subject to the employee's continued employment with the Company through each applicable vesting date. The option has a 10-year term and an exercise price of $6.45 per share, the January 21, 2025 closing price of the Company’s common stock. The estimated fair value of the inducement stock option award was $1.4 million using the Black-Scholes option pricing model based on market prices and the following assumptions at the date of inducement option grant: risk-free interest rate of 4.49%, dividend yield of 0%, volatility factor for our common stock of 123.41% and an expected life of 6 years. The Company granted an employment inducement stock option award for 157 shares of common stock, to its then-new President and Chief Executive Officer on July 6, 2021. The employment inducement stock option award was granted in accordance with the employment inducement award exemption provided by Nasdaq Listing Rule 5635(c)(4) and was therefore not awarded under the Company’s stockholder approved equity plan. This award vested in four equal installments beginning on the first anniversary of the date of issuance, subject to continued employment. The option has a 10-year term and an exercise price of $3,152 per share, the July 6, 2021 closing price of our common stock. As of December 31, 2025, the option was fully vested. The estimated fair value of this inducement stock option award was $403 thousand using the Black-Scholes option pricing model based on market prices and the following assumptions at the date of inducement option grant: risk-free interest rate of 1.13%, dividend yield of 0%, volatility factor for our common stock of 99.36% and an expected life of 7 years. The Company also granted an employment inducement stock option award for 157 shares of common stock to its then-new Chief Medical Officer on January 15, 2021. This employment inducement stock option was awarded in accordance with the employment inducement award exemption provided by Nasdaq Listing Rule 5635(c)(4) and was therefore not awarded under the Company’s stockholder approved equity plan. The option award will vest as follows: 25% upon initiation of a Phase 3 trial; 25% upon database lock; 25% upon acceptance for review of an investigational NDA; and 25% upon approval. The option has a 10-year term and an exercise price of $2,848 per share, the January 15, 2021 closing price of our common stock, as adjusted for the subsequent reverse stock splits. As of December 31, 2025, two of the vesting milestones have been achieved. The estimated fair value of the inducement stock option award granted was $403 thousand using the Black-Scholes option pricing model based on market prices and the following assumptions at the date of inducement option grant: risk-free interest rate of 11%, dividend yield of 0%, volatility factor for our common stock of 103.94% and an expected life of 10 years. Inducement stock option compensation expense totaled $0.4 million and $0.1 million for the years ended December 31, 2025 and December 31, 2024, respectively. As of December 31, 2025, there was $1.1 million of remaining unrecognized compensation expense related to these inducement stock options.

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- Definition The entire disclosure for shareholders' equity and share-based payment arrangement. Includes, but is not limited to, disclosure of policy and terms of share-based payment arrangement, deferred compensation arrangement, and employee stock purchase plan (ESPP). + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/718/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 505 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/505/tableOfContent + Details
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