NOTE 2 — LIQUIDITY

The Company is in the clinical stage and has not yet generated any revenues. For the six months ended December 31, 2021, the Company incurred a net loss of $20.4 million and net cash used in operating activities amounted to $13.5 million. For the fiscal year ended June 30, 2021, the Company incurred a net loss of $20.9 million and net cash used in operating activities amounted to $20.4 million. As of December 31, 2021, the Company had an accumulated deficit of $188.6 million, unrestricted cash and cash equivalents of $77.4 million, and total current liabilities of $6.4 million.

As discussed in Note 4, the Company is subject to license agreements that provide for future contractual payments upon achievement of various milestone events. Pursuant to the Xoma Agreement, the next milestone includes a $2.0 million payment upon dosing of the last patient in the Company’s ongoing Phase 2b clinical trial for RZ358. Dosing of the last patient in the ongoing Phase 2b study occurred in January 2022. Additionally, pursuant to the ActiveSite Agreement, the next milestone will consist of a $3.0 million payment upon dosing of the first patient in a Phase 2 clinical trial for RZ402.

​

As discussed in Note 6, in October and November 2021 the Company completed an underwritten public offering for net proceeds of $47.3 million and a registered direct offering for net proceeds of $5.0 million, resulting in total net proceeds of approximately $52.3 million. In addition, for the six months ended December 31, 2021, the Company received net proceeds of approximately $2.7 million from equity issuances under the Equity Distribution Agreement and the LPC Purchase Agreement discussed in Note 6. If additional capital resources are required in the future, the Company has the ability to raise additional equity financing proceeds as discussed in Note 6 under the captions Equity Distribution Agreement and LPC Purchase Agreement.

Management believes the Company’s unrestricted cash and cash equivalents balance of $77.4 million will be adequate to carry out currently planned activities at least through February 2023.