NOTE 2 — LIQUIDITY

The Company is in the clinical stage and has not yet generated any revenues. For the fiscal year ended June 30, 2023, the Company incurred a net loss of $51.8 million and net cash used in operating activities amounted to $44.5 million. As of June 30, 2023, the Company had an accumulated deficit of $261.0 million, and the Company’s capital resources consisted of cash and cash equivalents of $16.0 million, short-term investments in marketable debt securities of $85.9 million and long-term investments in marketable debt securities of $16.5 million.  

As of June 30, 2023, the Company had total liabilities of $7.5 million, including total current liabilities of $5.2 million. As discussed in Note 5, the Company is subject to license agreements that provide for future contractual payments upon achievement of various milestone events. Pursuant to the XOMA License Agreement (as defined below), a $5.0 million milestone payment will be due upon dosing of the first patient in a Phase 3 clinical trial for RZ358. First patient dosing milestone for the RZ358 Phase 3 clinical trial is expected to occur within the next 12 months.

Management believes the Company’s cash and cash equivalents and investments in marketable securities will be adequate to meet the Company’s contractual obligations and carry out ongoing clinical trials and other planned activities through September 2024, at a minimum.