TNXP 10-K & 10-Q changes, risk factors and insider trading
Tonix Pharmaceuticals Holding Corp. · Nasdaq · Pharmaceutical Preparations · CIK 1430306 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “RISKS RELATED TO OUR FINANCIAL CONDITION AND CAPITAL REQUIREMENTS”
New heading “Our independent registered public accounting firm has included an explanatory paragraph relating to our ability to continue as a going concern in its report on our audited financial statements.”
New heading “We will need additional capital to fund our operations. If additional capital is not available or is available at unattractive terms, we may be forced to delay, reduce the scope of or eliminate our research and development programs, reduce our commercialization efforts or curtail our operations.”
New heading “We have a limited operating history and only recently launched TONMYA in the United States, which may make it difficult to evaluate the prospects for our future viability.”
New heading “TONMYA and our migraine products remain subject to ongoing regulatory review, and if we fail to comply with continuing regulations, we could lose our approval and the sale of TONMYA or our migraine products could be suspended.”
New heading “If estimates of the size of the potential market for TONMYA are overstated or data we have used to identify prescribing healthcare providers is inaccurate, our ability to earn revenue to support our business could be materially adversely affected.”
New heading “Governments outside the United States tend to impose strict price controls, which may adversely affect our revenues, if any.”
New heading “If the FDA approves generic products that compete with TONMYA, sales of TONMYA would be adversely affected.”
New heading “We may never receive regulatory approval to market our current or future product candidates outside of the U.S.”
New heading “Our future growth may depend, in part, on our ability to penetrate foreign markets, where we would be subject to additional regulatory burdens and other risks and uncertainties that could materially adversely affect our business.”
New heading “We are dependent on license relationships with third parties for certain of our drug development programs.”
New heading “We may be unable to protect the confidentiality of our trade secrets, thus harming our business and competitive position.”
New heading “Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.”
New heading “We may need to license intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms.”
New heading “Changes in tax laws could adversely affect our business and financial condition.”
New heading “We may not be able to maintain compliance with the Listing Rules of the NASDAQ Stock Exchange.”
Removed heading “Our prospects are dependent on the continued successful commercialization of Zembrace and Tosymra. To the extent we cannot maintain or increase sales of Zembrace and Tosymra, our business, financial condition and results of operations may be materially adversely affected and the price of our common stock may decline.”
Removed heading “Successful development of our products is uncertain.”
Removed heading “We do not have, and may never obtain, the regulatory approvals we need to market our product candidates.”
Removed heading “If we are required to generate additional data related to safety and efficacy in order to obtain approval for TNX-SL for FM under Section 505(b)(2), we may be unable to meet our anticipated development and commercialization timelines.”
Removed heading “RISKS RELATED TO OUR FINANCIAL CONDITION AND CAPITAL REQUIREMENTS; COMPETITION”
Removed heading “We may be unable to continue to operate without the threat of liquidation for the foreseeable future. Our independent registered public accounting firm has included an explanatory paragraph relating to our ability to continue as a going concern in its report on our audited financial statements.”
Removed heading “We will need additional capital. If additional capital is not available or is available at unattractive terms, we may be forced to delay, reduce the scope of or eliminate our research and development programs, reduce our commercialization efforts or curtail our operations.”
Removed heading “Although we have two approved products on the market, we do not expect revenues from product sales to exceed expenses in the foreseeable future, if at all.”
Removed heading “Outbreaks of communicable diseases may materially and adversely affect our business, financial condition and results of operations.”
Removed heading “If we are unsuccessful in obtaining a priority review voucher for material threat medical countermeasures, the length of the approval process for our TNX-801 vaccine in development to prevent smallpox and mpox will be longer than the approval process with the priority review voucher.”
Removed heading “Government entities may take actions that directly or indirectly have the effect of limiting opportunities for our vaccine candidates for COVID-19.”
Removed heading “We could be delisted from Nasdaq, which could seriously harm the liquidity of our stock and our ability to raise capital.”
Removed heading “We expect that our quarterly results of operations will fluctuate, and this fluctuation could cause our stock price to decline.”
Largest changes
“We could be delisted from Nasdaq, which could seriously harm the liquidity of our stock and our ability to raise capital.”see in full comparison
“There can be no assurance that in the future we will be able to maintain compliance with the Nasdaq Listing Rules, including the minimum bid price requirement and other applicable corporate governance requirements. If we fail to maintain compliance with the minimum bid requirement or to meet the other applicable continued listing requirements for the NASDAQ Global Select Market in the future and NASDAQ determines to delist our common stock, the delisting could adversely affect the market price and liquidity of our common stock and reduce our ability to raise additional capital. …”see in full comparison
“We may be unable to continue to operate without the threat of liquidation for the foreseeable future. Our independent registered public accounting firm has included an explanatory paragraph relating to our ability to continue as a going concern in its report on our audited financial statements.”see in full comparison
“TONMYA and our migraine products remain subject to ongoing regulatory review, and if we fail to comply with continuing regulations, we could lose our approval and the sale of TONMYA or our migraine products could be suspended.”see in full comparison
“Recent actions by the United States federal government have caused concern in the industry that this may occur. For example, beginning in February 2025, the Department of Health and Human Services initiated the termination of a large number of its probationary employees, a category that includes new federal employees and employees recently promoted or transferred to new positions or agencies. Larger layoffs may follow, according to a memorandum issued by the Office of Personnel Management in February 2025, and subsequent actions have, in fact, led to material workforce reductions at FDA. …”see in full comparison
“For example, the biopharmaceutical industry in China is strictly regulated by the Chinese government. Changes to Chinese regulations or government policies affecting biopharmaceutical companies are unpredictable and may have a material adverse effect on our collaborators in China which could have an adverse effect on our business, financial condition, results of operations and prospects. …”see in full comparison
Full comparison: every changed paragraph (132)
RISKS RELATED TO OUR FINANCIAL CONDITION AND CAPITAL REQUIREMENTS
We started generating revenues from product sales in the third quarter of 2023, and from sales of TONMYA in the fourth quarter of 2025. We have incurred losses in each year of our operations, and we expect to continue to incur operating losses for the foreseeable future as our sales and marketing, research, development, preclinical and nonclinical testing, and clinical study activities increase, and if and when we acquire rights to additional products and product candidates. The amount of future losses and when, if ever, we will achieve profitability are uncertain. Failure to achieve profitability could diminish our ability to sustain operations, pay dividends on our common stock, obtain additional required funds and make required payments on any future indebtedness. We have three products that have generated commercial revenue in the past two years, but we do not expect revenues from the commercial sale of products to exceed expenses in the near future. Our ability to generate revenue and achieve profitability will depend on, among other things, successfully commercializing our products; establishing a favorable competitive position; successful completion of the development of our product candidates; obtaining necessary regulatory approvals from the FDA; establishing manufacturing, sales, and marketing arrangements with third parties; and raising sufficient funds to finance our activities. Many of these factors will depend on circumstances beyond our control. We might not succeed at any of these undertakings. If we are unsuccessful at some or all of these undertakings, our business, prospects, and results of operations may be materially adversely affected.
Our financial condition has varied significantly in the past and will continue to fluctuate from quarter-to-quarter and year-to-year due to a variety of factors, many of which are beyond our control. Factors relating to our business that may contribute to these fluctuations include other factors described elsewhere in this Annual Report and include, among other things:
Our independent registered public accounting firm has included an explanatory paragraph relating to our ability to continue as a going concern in its report on our audited financial statements.
If we are unable to obtain sufficient funding, our business, prospects, financial condition and results of operations will be materially and adversely affected, and we may be unable to continue as a going concern. For example, we anticipate that our existing cash and cash equivalents will enable us to maintain our current operations into the first quarter of 2027. If we are unable to continue as a going concern, we may have to liquidate our assets and may receive less than the value at which those assets are carried on our consolidated financial statements, and investors will likely lose all or a part of their investment. Future reports from our independent registered public accounting firm may continue to include statements expressing substantial doubt about our ability to continue as a going concern. If we seek additional financing to fund our business activities in the future and there remains substantial doubt about our ability to continue as a going concern, investors or other financing sources may be unwilling to provide additional funding on commercially reasonable terms or at all. In connection with our management’s assessment, our report from our independent registered public accounting firm for the fiscal year ended December 31, 2025, includes an explanatory paragraph stating that our recurring losses from operations and net capital deficiency raise substantial doubt about our ability to continue as a going concern.
We will need additional capital to fund our operations. If additional capital is not available or is available at unattractive terms, we may be forced to delay, reduce the scope of or eliminate our research and development programs, reduce our commercialization efforts or curtail our operations.
In order to successfully commercialize our marketed products and develop and bring our product candidates to market, we must commit substantial resources to costly and time-consuming commercialization activities, research, preclinical and nonclinical testing, clinical studies and the buildout of our sales, research and development and manufacturing facilities. We anticipate that our existing cash and cash equivalents will enable us to maintain our current operations until the first quarter of 2027. We anticipate using our cash and cash equivalents to commercialize TONMYA and to fund further research and development with respect to our product candidates. We will, however, need to raise additional funding sooner if our business or operations change in a manner that consumes available resources more rapidly than we anticipate. Our requirements for additional capital will depend on many factors, including:
We will require substantial funds to support our commercialization, research and development activities, and the anticipated costs of preclinical and nonclinical testing and clinical studies, regulatory approvals and eventual commercialization of our product candidates. Such additional sources of financing may not be available on favorable terms, if at all. If we do not succeed in raising additional funds on acceptable terms, we may be unable to commence or complete clinical studies or obtain approval of any product candidates from the FDA and other regulatory authorities. In addition, we could be forced to discontinue product development, forego sales and marketing efforts and forego attractive business opportunities. Any additional sources of financing will likely involve the issuance of our equity securities, which will have a dilutive effect on our shareholders.
There is no assurance that we will be successful in raising the additional funds needed to fund our business plan. If we are not able to raise sufficient capital in the near future, our continued operations will be in jeopardy, and we may be forced to cease operations and sell or otherwise transfer all or substantially all of our remaining assets.
Our
prospects are highly dependent on the
success of TNX-102TONMYA. SL.If Towe theare extentunable regulatoryto successfully commercialize or maintain approval of TNX-102 SL is delayed or not granted or, if approved, TNX-102 SL isfor
not commercially successful,TONMYA, our business, financial condition andcondition, results of operations mayand be materially adversely affectedprospects and
the pricevalue of our common stock maywill decline.be materially
adversely affected.
In August 2025, the FDA granted approval of TONMYA for the treatment of fibromyalgia. We have invested, and continue to invest, significant efforts and financial resources in the launch of TONMYA. We have never, as an organization, launched any other product, and there is no guarantee that we will be able to successfully commercialize TONMYA. There are numerous examples of failures to meet high expectations of market potential, including by pharmaceutical companies with more experience and resources than us. We believe that the commercial success of TONMYA depends on many factors, including the following:
While we believe that TONMYA has a commercially competitive profile, we cannot accurately predict the amount of time needed to attain a commercially successful profile or the amount of revenue that would be generated from sales of TONMYA, and there is no guarantee that we will be able to maintain or increase product sales for TONMYA or any of our marketed products. While we have established our commercial team and hired our U.S. sales force, we will need to further expand and develop the team in order to continue to grow the business. Even if we are successful in developing our commercial team, there are many factors that could negatively impact sales of our marketed products or cause commercialization efforts to be unsuccessful, including several factors that are outside our control. If the continued commercialization of our marketed products or future sales are less successful than expected or perceived as disappointing, our stock price could decline significantly, and our long-term success company could be harmed.
We have a limited operating history and only recently launched TONMYA in the United States, which may make it difficult to evaluate the prospects for our future viability.
We are still in the relatively early stages of our transition from a clinical-stage to a commercial-stage company. Our operations to date have been primarily limited to conducting research and development activities, including preclinical studies and clinical trials and, more recently, commercializing our migraine products and launching TONMYA. We have not yet demonstrated an ability to generate significant revenues, or to conduct sales and marketing activities on a long-term sustained basis necessary for successful product commercialization. Initial sales of TONMYA may not be predictive of long-term commercial results.
We may encounter unforeseen expenses, difficulties, complications, delays and other known or unknown factors in achieving our business objectives. Accordingly, you should consider our prospects in light of the costs, uncertainties, delays and difficulties frequently encountered by companies in the early commercial stage, especially pharmaceutical companies such as ours. Any predictions about our future success or viability may not be as accurate as they could be if we had a longer operating history with these activities.
TONMYA and our migraine products remain subject to ongoing regulatory review, and if we fail to comply with continuing regulations, we could lose our approval and the sale of TONMYA or our migraine products could be suspended.
Even though we received FDA approval for TONMYA, the manufacturing, labeling, packaging, distribution, adverse event reporting, storage, advertising, promotion, sampling, and record keeping related to TONMYA and our migraine products will remain subject to extensive regulatory requirements. These requirements include submissions of safety and other post-marketing information and reports, registration, as well as continued compliance with cGMP regulations, and GCPs for any clinical trials that we conduct post-approval, all of which may result in significant expense and limit our ability to commercialize TONMYA and our migraine products. As such, we and our contract manufacturers will be subject to periodic review and inspections to assess compliance with cGMP and adherence to commitments made in any NDA or other marketing application and previous responses to inspection observations. For certain commercial prescription drug products, manufacturers and other parties involved in the supply chain must also meet chain of distribution requirements and build electronic, interoperable systems for product tracking and tracing and for notifying the FDA of counterfeit, diverted, stolen and intentionally adulterated products or other products that are otherwise unfit for distribution in the United States. Accordingly, we and others with whom we work must continue to expend time, money, and effort in all areas of regulatory compliance, including manufacturing, production and quality control. The FDA may also require a REMS program for TONMYA or any future product candidates, which could include requirements for a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.
If we fail to comply with the regulatory requirements of the FDA and other applicable domestic and foreign regulatory authorities, or previously unknown problems with any of our marketed products, manufacturer, or manufacturing process are discovered, we could be subject to administrative or judicially imposed sanctions, including:
If any of these events occur, our ability to sell the affected product may be impaired, and we may incur substantial additional expense to comply with regulatory requirements, which could adversely affect our business, financial condition and results of operations.
If estimates of the size of the potential market for TONMYA are overstated or data we have used to identify prescribing healthcare providers is inaccurate, our ability to earn revenue to support our business could be materially adversely affected.
We have relied on external sources, including market research funded by us and third parties, and internal analyses and calculations to estimate the potential market opportunities for TONMYA. The externally sourced information used to develop these estimates has been obtained from sources we believe to be reliable, but we have not verified the data from such sources, and their accuracy and completeness cannot be assured. With respect to TONMYA, our internal analyses and calculations are based upon management’s understanding and assessment of numerous inputs and market conditions. These understandings and assessments necessarily require assumptions subject to significant judgment and may prove to be inaccurate. As a result, our estimates of the size of these potential market for TONMYA could prove to be overstated, perhaps materially.
In addition, we are relying on third-party data to identify the prescribers who treat the majority of fibromyalgia patients in the United States; however, we may not be marketing to the appropriate prescribers and may therefore be limiting our market opportunity.
The research, testing,
manufacturing, labeling, approval, sale, import, export, marketing, and distribution of pharmaceutical product candidates are subject
to extensive regulation by the FDA. We have focused a significant portion of our activities and resources on the development of
TNX-102 SL, and we believe our prospects are also dependent on our ability to obtain regulatory approval for and successfully commercialize
TNX-102 SL in the U.S. The regulatory approval and successful commercialization of TNX-102 SL is subject to many risks, including
those discussed in other risk factors, and TNX-102 SL may not receive approval from the FDA. If the results or timing of regulatory
filings, the regulatory process, regulatory developments, commercialization, or other activities, actions or decisions related
to TNX-102 SL do not meet our or others’ expectations, the market price of our common stock could decline significantly.
The FDA
assigned a PDUFA goal date of August 15, 2025, for a decision on marketing authorization for TNX-102 SL. and retains complete
discretion in deciding whether to approve the NDA for TNX-102 SL, and there are many components to an NDA filing beyond the efficacy
and safety data provided to the FDA. No assurances can be given that the FDA will approve TNX-102 SL for the treatment of FM, or
that if approved, we will successfully commercialize TNX-102 SL.
Among
policy makers and payors in the United States and elsewhere, there is significant interest in promoting changes in healthcare
systems with the stated goals of containing healthcare costs, improving quality and/or expanding access. In the United States,
the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major legislative
initiatives. For example, in the United States, the PPACAPatient Protection and Affordable Care Act (“ACA”), as supplemented
by the Inflation Reduction Act of 2022 (“IRA”) and presidential executive orders, substantially changed the way healthcare
is financed by both the government
and private insurers, and significantly affects the pharmaceutical industry. Many provisions
of the ACA impact the biopharmaceutical
industry, including that in order for a biopharmaceutical product to receive federal reimbursement
under the Medicare Part B and
Medicaid programs or to be sold directly to U.S. government agencies, the manufacturer must extend
discounts to entities eligible
to participate in the drug pricing program under the Public Health Services Act, or PHS.
Additionally,
the InflationIRA, Reductionwhich Actis ofsubject 2022to active modification efforts, includes policies that are designed to have a direct impact on
drug prices and reduce reduced
drug spending by the federal government. This legislation contains substantial drug pricing reforms, including
the establishment
of a drug price negotiation program within the U.S. Department of Health and Human Services that wouldrequires require
manufacturers to charge
a negotiated “maximum fair price” for certain selected drugs covered by Medicare or pay an
excise tax for noncompliance, the establishment of
rebate payment requirements on manufacturers of certain drugs payable under
Medicare Parts B and D to penalize price increases
that outpace inflation, and requires manufacturers to providerequired discounts on
Part D drugs. Moreover, presidential executive orders and agency guidance may
rapidly change reimbursement and pricing conditions.
At
the state level, legislatures are increasingly passing legislation and
implementing regulations designed to control pharmaceutical
and biological product pricing, including price orand patient reimbursement constraints,
discounts, restrictions on certain product
access and marketing cost disclosure and transparency measures, and, in some cases, designed
to encourage importation from other
countries and bulk purchasing. Other examples of proposed and recent changes include, but are not limited to,
expanding post-approval
requirements, changing the Orphan Drug Act, and restricting sales and promotional activities for pharmaceutical products, enacting
products.drug price transparency laws, and the creation of prescription drug affordability boards with authority to review and, in some
cases, constrain, payment levels.
We
cannot be sure whether additional legislative or administrative changes will be enacted, or whether government regulations, guidance
or interpretations
will be changed, or what the impact of such changes would be on the marketing approvals, sales, pricing, or
reimbursement of our
drug candidates or products, if any, may be. We expect that these and other healthcare reform measures that
may be adopted in
the future, may result in more rigorous coverage criteria and in additional downward pressure on the price that
we receive for
any approved drug. Any reduction in reimbursement from Medicare or other government programs may result in a similar
reduction reduction
in payments from private payors. The implementation of cost containment measures or other healthcare reforms may prevent
us from
being able to generate revenue, attain profitability, or commercialize our drugs.
In addition, FDA regulations and guidance may be revised or reinterpreted by the FDA in ways that may significantly affect our business and our products. Any new regulations or guidance, or revisions or reinterpretations of existing regulations or guidance, may impose additional costs or lengthen FDA review times for our product candidates. Moreover, ongoing policy focus on accelerated approval oversight and facilitating the introduction of generics and biosimilars could tighten post-marketing obligations and increase competitive pressure on reference products. We cannot determine how changes in regulations, statutes, policies, or interpretations when and if issued, enacted or adopted, may affect our business in the future. Such changes could, among other things, require:
Even
if the FDA approves
one or more of our product candidates, physicians and patients may not accept it or use it. Even if physicians
and patients would
like to use our products, our products may not gain market acceptance among healthcare payors such as managed
care formularies,
insurance companies or government programs such as Medicare or Medicaid. Acceptance and use of our products
will depend upon a
number of factors including: perceptions by members of the health care community, including physicians, about
the safety and effectiveness
of our drug or device product; cost-effectiveness of our product relative to competing products;
availability of reimbursement
for our product from government or other healthcare payors; and effectiveness of marketing and distribution
efforts by us and our
licensees and distributors, if any.
Because
we expect sales of our current product candidates, if approved, to generate substantially all of our product revenues for the
foreseeable future,revenues, the failure of these products to
find market acceptance would harm our business and could require us to seek
additional financing.
Our prospects are dependent on the continued
successful commercialization of Zembrace and Tosymra. To the extent we cannot maintain or increase sales of Zembrace and Tosymra, our
business, financial condition and results of operations may be materially adversely affected and the price of our common stock may decline.
Zembrace and Tosymra are our only drugs that have been approved for sale.
Continued commercialization of Zembrace and Tosymra is subject to many risks, and there is no guarantee that we will be able to maintain
or increase sales of Zembrace and Tosymra. While we have established our commercial team and have hired our U.S. sales force, we will need
to further expand and develop the team in order to continue to successfully grow the business. Even if we are successful in developing
our commercial team, there are many factors that could negatively impact sales of Zembrace and Tosymra or cause the continued commercialization
of Zembrace and Tosymra to be unsuccessful, including several factors that are outside our control. If the continued commercialization
of Zembrace and Tosymra or future sales are less successful than expected or perceived as disappointing, our stock price could decline
significantly, and the long-term success of the product and our company could be harmed.
Additionally, our strategy in the U.S. includes distributing Zembrace and
Tosymra solely through a limited network of third-party specialty distributors and specialty pharmacies. While we have entered into agreements
with each of these distributors and pharmacies to distribute Zembrace and Tosymra in the U.S., they may not perform as agreed or they
may terminate their agreements with us. Also, we may need to enter into agreements with additional distributors or pharmacies, and there
is no guarantee that we will be able to do so on commercially reasonable terms or at all. In the event we are unable to maintain, or expand,
if needed, our commercial team, including our U.S. sales force, or maintain and, if needed, expand, our network of third-party specialty
distributors and specialty pharmacies, our ability to continue commercializing Zembrace and Tosymra would be limited, and Zembrace and
Tosymra may not be profitable.
We are focused on product
development, and we started generating revenues from product sales in the third quarter of 2023. We have incurred losses in each
year of our operations, and we expect to continue to incur operating losses for the foreseeable future. These operating losses
have adversely affected and are likely to continue to adversely affect our working capital, total assets and shareholders’
equity.
We and our prospects
should be examined in light of the risks and difficulties frequently encountered by new and early-stage companies in new and rapidly
evolving markets. These risks include, among other things, the speed at which we can scale up operations, our complete dependence
upon development of our product candidates that currently have no market acceptance, our ability to establish and expand our brand
name, our ability to expand our operations to meet the commercial demand of our clients, our development of and reliance on strategic
and customer relationships and our ability to minimize fraud and other security risks.
The process of developing
our products requires significant clinical, nonclinical and CMC development, laboratory testing and clinical studies. In addition,
commercialization of our product candidates will require that we obtain necessary regulatory approvals and establish sales, marketing
and manufacturing capabilities, either through internal hiring or through contractual relationships with others. We expect to incur
substantial losses for the foreseeable future as a result of anticipated increases in our research and development costs, including
costs associated with conducting preclinical and nonclinical testing and clinical studies, and regulatory compliance activities.
We expect to incur
substantial additional operating expenses over the next several years as our research, development, preclinical and nonclinical
testing, and clinical study activities increase, and if and when we acquire rights to additional product candidates. The
amount of future losses and when, if ever, we will achieve profitability are uncertain. We have two products that have generated
commercial revenue starting in the third quarter of 2023, but we do not expect revenues from the commercial sale of products to
exceed expenses in the near future. Our ability to generate revenue and achieve profitability will depend on, among other things,
successful completion of the development of our product candidates; obtaining necessary regulatory approvals from the FDA; establishing
manufacturing, sales, and marketing arrangements with third parties; successfully commercializing our products; establishing a
favorable competitive position; and raising sufficient funds to finance our activities. Many of these factors will depend on circumstances
beyond our control. We might not succeed at any of these undertakings. If we are unsuccessful at some or all of these undertakings,
our business, prospects, and results of operations may be materially adversely affected.
We have not yet obtained regulatory approvals for TNX-102
SL or any of our other product candidates. Consequently, any predictions made about our future success or viability may not be as accurate
as they could be if we had a longer operating history or commercialized products. Our financial condition has varied significantly in
the past and will continue to fluctuate from quarter-to-quarter or year-to-year due to a variety of factors, many of which are beyond
our control. Factors relating to our business that may contribute to these fluctuations include other factors described elsewhere in this
annual report and also include, among other things:
Changes
in federal funding policies, including the ongoing review of DoD
contracts and NIH grants and in-kind support by the newcurrent administration of President Donald Trump, administration,
could materially impact our financial
resources and the progress of research conducted with U.S.-based university collaborators. While we
have secured certain DoD and NIH funding
and NIH in-kind support through Project NextGen, there is no guarantee that such funding
or in-kind support will not be rescinded or otherwise
restricted. Additionally,restricted, DoD,particularly NIHas andthe Biomedical Advanced Research and Development
Authority (“BARDA”) has begun withdrawing or terminating some Project NextGen-related awards. Additionally, DoD,
NIH and BARDA funding for any of our future
projects may be delayed, reduced, or denied altogether. Any such changes could adversely
affect our research programs, financial condition,
and operational plans. Further, certain research projects conducted in collaboration
with U.S.-based university collaborators could be
slowed or discontinued.
RISKS
RELATED TO PRODUCT DEVELOPMENT,
REGULATORY APPROVAL, MANUFACTURING AND COMMERCILAIZATIONCOMMERCIALIZATION
Our
drug development methodsactivities may not lead to commercially
viable drugs for any of several reasons. For example, we may fail to
identify appropriate targets or compounds, our drug candidates may
fail to be safe and effective in clinical studies, or we may
have inadequate financial or other resources to pursue development efforts
for our drug candidates. Our drug candidates will require
significant additional development, clinical studies, regulatory clearances
and additional investment by us or our collaborators
before they can be commercialized.
Successful development of our products
is uncertain.
Our development of
current and future product candidates is subject to the risks of failure and delay inherent in the development of new pharmaceutical
products, including: delays in product development, clinical testing, or manufacturing; unplanned expenditures in product development,
clinical testing, or manufacturing; failure to receive regulatory approvals; emergence of superior or equivalent products; inability
to manufacture on our own, or through any others, product candidates on a commercial scale; and failure to achieve market acceptance.
Because of these risks,
our research and development efforts may not result in any commercially viable products. If a significant portion of these development
efforts are not successfully completed, required regulatory approvals are not obtained or any approved products are not commercially
successfully, our business, financial condition, and results of operations may be materially harmed.
If
we, our collaborators,
collaborators or our CMOs fail to comply with applicable regulatory requirements at any stage during the regulatory process,
such noncompliance
could result in, among other things, delays in the approval of applications or supplements to approved applications;
refusal of
a regulatory authority, including the FDA, to review pending market approval applications or supplements to approved
applications;
warning letters; fines; import and/or export restrictions; product recalls or seizures; injunctions; total or partial
suspension suspension
of production; civil penalties; withdrawals of previously approved marketing applications or licenses; recommendations
by the FDA
or other regulatory authorities against governmental contracts; and/or criminal prosecutions.
We do not have, and may never obtain,
the regulatory approvals we need to market our product candidates.
Following completion
of clinical studies, the results are evaluated and, depending on the outcome, submitted to the FDA in the form of an NDA or BLA
in order to obtain FDA approval of the product and authorization to commence commercial marketing. In responding to an NDA, the
FDA may require additional testing or information, may require that the product labeling be modified, may impose post-approval
study and other commitments or reporting requirements or other restrictions on product distribution, or may deny the application.
The FDA has established performance goals for review of NDAs or BLAs: six months for priority applications and ten months for standard
applications. However, the FDA is not required to complete its review within these time periods. The timing of final FDA review
and action varies greatly but can take years in some cases and may involve the input of an FDA advisory committee of outside experts.
Product sales in the United States may commence only when an NDA or BLA is approved.
To date, we have not received the regulatory approvals required for the commercial sale of any of our products in the United States or
in any foreign jurisdiction. None of our product candidates have been determined to be safe and effective, and we have not submitted
an NDA or BLA equivalent application to any foreign regulatory authorities for any of our product candidates.
It is possible that
none of our product candidates will be approved for marketing. Failure to obtain regulatory approvals, or delays in obtaining regulatory
approvals, may adversely affect the successful commercialization of any drugs or biologics that we or our partners develop, may
impose additional costs on us or our collaborators, may diminish any competitive advantages that we or our partners may attain,
and/or may adversely affect our receipt of revenues or royalties.
If
any of our other
product candidates cause SAEs or undesirable side effects or suffer from quality control issues:
If we are required to generate additional data related to safety and efficacy
in order to obtain approval for TNX-SL for FM under Section 505(b)(2), we may be unable to meet our anticipated development and commercialization
timelines.
We submitted the NDA for TNX-102 SL for FM under Section 505(b)(2) of the
FDCA, which would enable us to rely in part on data in the public domain or elsewhere. Some of the data required by the FDA for approval
may be related to products already approved by the FDA. If the data relied upon is related to products already approved by the FDA and
covered by third-party patents, we would be required to certify that we do not infringe the listed patents or that such patents are invalid
or unenforceable. As a result of the certification, the third-party would have 45 days from notification of our certification to initiate
an action against us. In the event that an action is brought in response to such a certification, the approval of our NDA could
be subject to a stay of up to 30 months or more while we defend against such a suit. Approval of our product candidates under Section
505(b)(2) may therefore be delayed until patent exclusivity expires or until we successfully challenge the applicability of those patents
to our product candidates. Alternatively, we may elect to generate sufficient additional clinical data so that we no longer rely on data
which triggers a potential stay of the approval of our product candidates. Even if no exclusivity periods apply to our applications under
Section 505(b)(2), the FDA has broad discretion to require us to generate additional data on the safety and efficacy of our product candidates
to supplement third-party data on which we may be permitted to rely. In either event, we could be required, before obtaining marketing
authorization for any of our product candidates, to conduct substantial new research and development activities beyond those we currently plan
to engage in order to obtain approval of our product candidates. Such additional new research and development activities would be costly
and time-consuming.
The FDA may not approve our NDA based on their review of the submitted data. If cyclobenzaprine-containing products are withdrawn
from the market by the FDA for any safety reason, we may not be able to reference such products to support a 505(b)(2) NDA for
TNX-102 SL, and we may need to fulfill the more extensive requirements of Section 505(b)(1). If we are required to generate additional
data to support approval, we may be unable to meet our anticipated development and commercialization timelines, may be unable to
generate the additional data at a reasonable cost, or at all, and may be unable to obtain marketing authorization of our lead product
candidate.
Our
relationships with customers, physicians,physicians and third-party payors is subject,subject to federal and state healthcare fraud and abuse laws,
false claims laws, health information privacy and security laws, and other healthcare laws and regulations. If we are unable to
comply, or have not fully complied, with such laws, we could face substantial penalties.
It
is possible that governmentalgovernment authorities will conclude that our business practices may not comply with current or future statutes,
regulations or case law involving applicable fraud and abuse or other healthcare laws and regulations. If our operations are found
to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant
civil, criminal and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion of drugs from government funded
healthcare programs, such as Medicare and Medicaid, additional reporting requirements and oversight if we become subject to a
corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws and the curtailment
curtailment or restructuring of our operations.
The
risk of our being found in violation of these laws is increased by the fact that many of them have not been fully interpreted
by the regulatory authorities or the courts, and their provisions are open to a variety of interpretations.interpretations, and they are subject to
frequent policy changes. In addition, time-sensitive reporting and complex data aggregation requirements, and the need for
ongoing training and monitoring create a shifting compliance environment. Efforts to ensure
that our business arrangements with third parties will complycomplies with applicable
healthcare laws and regulations will involveinvolves substantial
costs. Any action against us for violation of these laws, even if we successfully
defend against it, could cause us to incur significant
legal expenses and divert our management’s attention from the operation
of our business. The shifting compliance environment
and the need to build and maintain robust and expandable systems to comply
with multiple jurisdictions with different compliance
and/or reporting requirements increases the possibility that a healthcare companywe may run
afoul of one or more of the requirements.
If
TNX-102 SLTONMYA or any of our other product candidates areis approved for commercialization outside of the United States, we intend to
enter into
agreements with third parties to market them on a worldwide basis or in more limited geographical regions. We expect
that we will
be subject to additional risks related to entering into international business relationships, including:
Governments outside the United States tend to impose strict price controls, which may adversely affect our revenues, if any.
If any our products are approved in foreign jurisdictions, we will be subject to pricing and reimbursement policies in those jurisdictions. In some countries, including countries in the EU, the pricing of prescription pharmaceuticals is subject to governmental control. In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a drug. To obtain reimbursement or pricing approval in some countries, governmental authorities adopt a number of different methodologies for assessing drug costs and reimbursement levels. These include comparisons with currently available medicines for the same indication and/or cost effectiveness assessments as the basis for negotiation. If reimbursement of our drugs is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, our business could be materially harmed.
Management's Discussion & Analysis (MD&A)
Removed heading “December 2023 Financing”
Removed heading “September 2023 Financing”
Removed heading “July 2023 Financing”
Removed heading “2020 At-the-Market Offerings”
Removed heading “Employee Stock Purchase Plan”
Largest changes
“Asset impairment charges. We test certain assets for impairment, including goodwill, indefinite-lived intangibles, long-lived assets and amortizing intangibles. Goodwill is reviewed for impairment by comparing the carrying value of a reporting unit to its fair value on an annual basis as of June 30, or more frequently if events or changes in circumstances indicate that the carrying amount of goodwill may be impaired. …”see in full comparison
“We completed the required annual impairment test for goodwill as of June 30, 2024, primarily using an income approach or discounted cash flow analysis. Additionally, due to a sustained decline in revenues and continued delays in building out the sales team for our commercialized products, we also tested the commercialized products asset group for recoverability as of June 30, 2024, and determined that the carrying value was not recoverable and therefore estimated the fair value of the asset group using a discounted cash flow analysis. …”see in full comparison
“Business Combinations. We apply the acquisition method of accounting for business combinations. Under the acquisition method, the acquiring entity recognizes all of the identifiable assets acquired and liabilities assumed at their acquisition date fair values. We use our best estimates and assumptions to estimate the fair values of these tangible and intangible assets. Any excess of the purchase price over amounts allocated to the assets acquired is recorded as goodwill. …”see in full comparison
“We maintain a diversified development pipeline generated through internal discovery, in-licensing, acquisitions, and collaborations with academic and non-profit institutions. The Company’s pipeline addresses conditions that span central nervous system (“CNS”), infectious disease, immunology, and rare disease, with multiple programs in clinical and preclinical development. The proprietary cyclobenzaprine HCl sublingual tablet formulation contained in TONMYA is referred to as “TNX-102 SL” outside of the fibromyalgia indication. …”see in full comparison
We continue to face significant challenges and uncertaintiessee in full comparisonand,andasmustasuccessfullyresult,launchour available capital resources may be consumed more rapidly than currently expected due to changes we may make in our researchTONMYA anddevelopment spending plans. These factors raise substantial doubt about our ability to continue as a going concern for the one-year period from the date of filing of this Form 10-K. We mustobtain additional funding through publicorand private financingorand collaborative arrangements with strategic partners to increase the funds available to fund operations. However, we may not be able to raise capital on terms acceptable to us, or at all. Without the successful product launch of TONMYA and obtaining additional funds, we may be forced to delay, scale back or eliminate some or all of our research and developmentactivities,activities or otheroperationsoperations, and potentially delay product development in an effort toprovidemaintain sufficient funds to continueouroperations. If any of these events occurs, our ability to achieveourdevelopment and commercialization goalswouldwill be adversely affected and we may be forced to cease operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Costsee in full comparisonofSales. The Company recognized costofsales beginning in the year ended December 31, 2023 as a result of the acquisition of Zembrace and Tosymra from Upsher-Smith Laboratories (“Upsher Smith”). See discussion at Note 11 to our financial statements appearing in this Annual Report on Form 10-K.Sales. Cost of goods sold during the year ended December 31, 2025, was $6.6 million, including write-downs related to Tosymra and Zembrace finished goods inventory of approximately $0.7 million based on an assessment of inventory on hand and projected sales prior to the respective expiration dates. Cost of sales recognized for the year ended December 31, 2024, was $7.8 million,million,including write-downs related to Tosymra and Zembrace finished goods inventory of approximately $1.5 million based on an assessmentassessmentof inventory on hand and projected sales prior to the respective expiration dates.Cost of sales recognized for the year ended December 31, 2023, was $4.7 million.
Full comparison: every changed paragraph (128)
This
Management’s Discussion and Analysis of Financial Condition and Results of Operations includes a number of forward-looking
statements that reflect Management’s current views with respect to future events and financial performance. You can identify
these statements by forward-looking words such as “may” “will,” “expect,” “anticipate,”
“believe,” “estimate” and “continue,” or similar words. Those statements include statements
regarding the intent, belief or current expectations of us and members of its management team as well as the assumptions on which
such statements are based and should be read together with the “Risk Factors” section of this Annual Report on Form
10-K 10-K
for a discussion of important factors that could cause actual results to differ materially from the results described in
or implied
by the forward-looking statements contained in the following discussion and analysis. Our actual results could differ
materially materially
from those anticipated in these forward-looking statements as a result of various factors, including those discussed
below and
elsewhere in this Annual Report and in other reports we file with the Securities and Exchange Commission, particularly
those under
“Risk Factors.Factors”.
We are a fully-integrated biopharmaceutical company commercializing and developing innovative therapies for central nervous system (“CNS”) disorders, immunology, infectious diseases, and rare diseases. Our portfolio consists of both commercial and development-stage programs.
In August 2025, we received approval from the FDA for TONMYA™ (cyclobenzaprine HCl sublingual tablets) for the treatment of fibromyalgia. TONMYA, our first internally developed product to become FDA approved, was commercially launched by us in the United States on November 17, 2025. TONMYA is the first new medicine for fibromyalgia in more than 15 years and is a centrally acting, non-opioid analgesic designed for bedtime administration and long-term use. The approval and launch of TONMYA marked major milestones in our evolution. We hold worldwide commercialization rights to TONMYA. In addition to TONMYA, we market two FDA-approved prescription products for the treatment of acute migraine: Zembrace® SymTouch® (sumatriptan injection) and Tosymra® (sumatriptan nasal spray). Our commercial platform includes sales, marketing, market access, distribution, and patient support capabilities.
We maintain a diversified development pipeline generated through internal discovery, in-licensing, acquisitions, and collaborations with academic and non-profit institutions. The Company’s pipeline addresses conditions that span central nervous system (“CNS”), infectious disease, immunology, and rare disease, with multiple programs in clinical and preclinical development. The proprietary cyclobenzaprine HCl sublingual tablet formulation contained in TONMYA is referred to as “TNX-102 SL” outside of the fibromyalgia indication. We are exploring the utility of TNX-102 SL (sublingual cyclobenzaprine) in Phase 2 clinical trials for major depressive disorder and acute stress disorder. TNX-102 SL is being developed to treat acute stress reaction and acute stress disorder under an Investigator-Initiated investigational new drug application (“IND”) at the University of North Carolina in the ongoing OASIS study funded by the U.S. Department of Defense (“DoD”). A Phase 2 study of TNX-102 SL for major depressive disorder is expected to commence mid-2026 under a Tonix IND that has been cleared by FDA.
Our clinical stage infectious disease portfolio includes monoclonal antibody TNX-4800 (anti-OspA from Borrelia burgdorferi) for seasonal prevention of Lyme disease, for which initiation of a Phase 2 field study is planned for the first half of 2027 and a Phase 2 human challenge study is planned for 2028, pending FDA clearances.
Our clinical-stage immunology development portfolio consists of biologics to address organ transplant rejection and autoimmunity, including TNX-1500, which is a Phase 2- ready Fc-modified humanized monoclonal antibody targeting CD40-ligand (CD40L or CD154) being developed for the prevention of allograft rejection and for the treatment of autoimmune diseases.
Another CNS candidate in clinical development is TNX-1300 (double-mutant cocaine esterase), which is in Phase 2 for the treatment of cocaine intoxication. TNX-1300 has been granted Breakthrough Therapy designation by the FDA.
Our clinical-stage rare disease portfolio includes TNX-2900, intranasal oxytocin potentiated with magnesium, in development for Prader-Willi syndrome and expected to start a Phase 2 study in the first quarter of 2027.
Our pre-clinical, pre-IND infectious disease portfolio includes TNX-801 (horsepox, live virus vaccine), as vaccine for mpox and smallpox. We own a facility in Dartmouth, MA that was purpose-built to manufacture TNX-801 under Good Manufacturing Practices (GMP) to support clinical development and potential commercialization. The facility was decommissioned in 2024 and may be reactivated on the earlier of 2027 or in the case of a national or international emergency.
Our pre-IND infectious disease portfolio also includes TNX-4200, which is a small molecule broad-spectrum antiviral agent targeting CD45 for the prevention or treatment of high lethality infections to improve the medical readiness of military personnel in biological threat environments. The TNX-4200 program is supported by a $34 million contract over five years from the U.S. DoD’s Defense Threat Reduction Agency (DTRA). We own and operate a state-of-the art research facility in Frederick, Maryland that supports this research.
Our pre-IND pre-clinical immunology portfolio includes TNX-1700, which is a fusion protein of TFF2 and albumin is in preclinical development for the treatment of gastric and colorectal cancer in combination with PD-1 blockade in collaboration with Columbia University.
Our pre-clinical, pre-IND CNS portfolio also includes TNX-4900, a highly selective small-molecule Sigma-1 receptor (“S1R”) antagonist for neuropathic pain.
We are a fully-integrated biopharmaceutical company focused on transforming
therapies for pain management and vaccines for public health challenges. Our development portfolio is focused on central nervous system
(CNS) disorders. Our priority is to advance TNX-102 SL, a product candidate for the management of fibromyalgia, for which an NDA was submitted
based on two statistically significant Phase 3 studies for the management of fibromyalgia and for which a PDUFA (Prescription Drug User
Fee act) goal date of August 15, 2025 has been assigned for a decision on marketing authorization. The FDA has also granted Fast Track
designation to TNX-102 SL for the management of fibromyalgia. TNX-102 SL is also being developed to treat acute stress reaction and acute
stress disorder under a Physician-Initiated IND at the University of North Carolina in the OASIS study funded by the U.S. Department of
Defense (DoD). Tonix’s CNS portfolio includes TNX-1300 (cocaine esterase), a biologic in Phase 2 development designed to treat cocaine
intoxication that has FDA Breakthrough Therapy designation, and its development is supported by a grant from the National Institute on
Drug Abuse. Tonix’s immunology development portfolio consists of biologics to address organ transplant rejection, autoimmunity and
cancer, including TNX-1500, which is an Fc-modified humanized monoclonal antibody targeting CD40-ligand (CD40L or CD154) being developed
for the prevention of allograft rejection and for the treatment of autoimmune diseases. Tonix also has product candidates in development
in infectious disease, including a vaccine for mpox, TNX-801. We recently announced a contract with the U.S. DoD’s Defense Threat
Reduction Agency (DTRA) for up to $34 million over five years to develop TNX-4200, small molecule broad-spectrum antiviral agents targeting
CD45 for the prevention or treatment of infections to improve the medical readiness of military personnel in biological threat environments.
We own and operate a state-of-the art infectious disease research facility in Frederick, Maryland. Tonix Medicines, our commercial subsidiary,
markets Zembrace® SymTouch® (sumatriptan injection) 3 mg and Tosymra® (sumatriptan nasal spray) 10 mg for the treatment of
acute migraine with or without aura in adults.
Zembrace SymTouch and Tosymra are registered trademarks of Tonix Medicines. TONMYA is a registered trademark of Tonix Pharma Limited. All other marks are the property of their respective owners. We are led by a management team with significant industry experience in drug development.
101101
We
anticipate that our results of operations will fluctuate for the foreseeable future due to several factors, such as the sale of
our commercialized assets, progress of our research and development efforts and the timing and outcome of regulatory submissions.
Due to these uncertainties, accurate predictions of future operations are difficult or impossible to make. Since the acquisition
of Zembrace and Tosymra on June 30, 2023, we are now reporting product revenue and related costs.
Revenues. Revenue recognized for the year ended December 31, 2025 and 2024 was $13.1 and $10.1 million, respectively.
Revenues. The
Company recognized revenue beginning in the year ended December 31, 2023, as a result of the acquisition of two marketed products.
See discussion at Note 11 to our financial statements appearing in this Annual Report on Form 10-K. Revenue recognized for the
year ended December 31, 2024 and 2023 was $10.1 and $7.8 million, respectively.
Cost of
Sales. The Company recognized cost of sales beginning in the year ended December 31, 2023 as a result of the acquisition of
Zembrace and Tosymra from Upsher-Smith Laboratories (“Upsher Smith”). See discussion at Note 11 to our financial
statements appearing in this Annual Report on Form 10-K.Sales. Cost of goods sold during the year ended December 31, 2025, was $6.6 million, including write-downs related to Tosymra
and Zembrace finished goods inventory of approximately $0.7 million based on an assessment of inventory on hand and projected
sales prior to the respective expiration dates. Cost of sales recognized for the year ended December 31, 2024, was $7.8 million,
million, including write-downs related to Tosymra and Zembrace finished goods inventory of approximately $1.5 million based on an assessment
assessment of inventory on hand and projected sales prior to the respective expiration dates. Cost of sales recognized for the year
ended December 31, 2023, was $4.7 million.
Research
and Development Expenses. Research and development expenses for the fiscal year ended December 31, 2024,2025, were $40.0$44.5 million,
million,an a decreaseincrease of $46.7$4.5 million, or 54%,11%, from $86.7$40.0 million for the fiscal year ended December 31, 2023.2024. This decreaseincrease is predominately
predominately due to decreasedincreased clinicalmanufacturing expenses of $18.8$6.8 million,million and non-clinical expenses of $10.5 million, manufacturing expenses
of $3.1$2.9 million as a result of fewer trials in the clinic and pipeline prioritization
period over period, and in employee-related expenses
of $7.1$0.6 million due to increased headcount, offset by a decrease in regulatory
expenses of $1.7 million and laboffice-related suppliesexpenses of $4.1$1.8 million due to a reduction in expenditures, predominatelyas well as a decrease
in clinical expenses of $2.0 million as a result of thefewer decommissionclinical of the ADC and reduction in force earlier in 2024.trials.
102102
In
August 2022, we received a Cooperative Agreement grant from the National Institute on Drug Abuse (“NIDA”), part of
the National Institutes of Health, to support the development of its TNX-1300 product candidate for the treatment of cocaine intoxication.
During the yearyears ended December 31, 20242025 and 2023,2024, we recorded $1.6$0.6 and $2.9$1.6 million, respectively in funding as a reduction of
related research and development expenses.
Selling,
General and Administrative Expenses. Selling, Generalgeneral and administrative expenses for the fiscal year ended December 31,
31, 2024,2025, were $40.1$87.7 million, an increase of $5.3$47.6 million, or 15%,119%, from $34.8$40.1 million incurred in the fiscal year ended December
31, 31,
2023.2024. The increase is primarily due to an increase in financial reporting expenses of $1.2 million, related to the special
shareholder meetings in 2024, an increase in sales and marketing of $1.2$37.7 million, an increase in professional legal
fees of $2.7$1.5 million,
an increase in depreciation of property and equipment of $0.4 million and an increase in fees and permits of $0.4 million,employee related
to licenses obtained to sell the migraine products, offset by a decrease in employee-related costs of $1.0$7.6 million,million. dueAll increases are related to fewerour employees.marketed migraine
products as well as the launch of TONMYA in November 2025.
Asset impairment charges. We recognized a non-cash impairment charge of $48.8 million related to property and equipment, a non-cash impairment of $1.0 million related to goodwill, and a non-cash impairment charge of $9.2 million related to intangible assets, which is reflected in asset impairment charges in the consolidated statements of operations for the year ended December 31, 2024. No impairment charges were incurred during 2025.
The
impairment of the Tosymra and Zembrace inventory, intangibles and goodwill was driven by our delayed investment in the sales personnel
required to drive growth in the business as we are focusing our cash resources to further our efforts to bring TNX-102 SL through
the approval process and to market. However, we believe that the benefits and long-term value proposition of the 2023 acquisition
of Tosymra and Zembrace remain, in that we now have the infrastructure to be ready to manufacture and sell TNX-102 SL under an
expedited timeline pending FDA approval for which we expect an FDA decision in 2025.timeline.
103103
License
AgreementsAgreement
On
FebruaryJune 13,26, 2023,2025, we exercised an option to obtainobtained an exclusive worldwide license from Columbiathe University of Massachusetts (“ColumbiaUMass”) Chan Medical School for
the development of aTNX-4800 portfolio of fully human and murine mAbs for the treatment or prophylaxis of SARS-CoV-2 infection, including(formerly
our TNX-3600 and TNX-4100 product candidates, respectively. The licensed mAbs were developedknown as partmAb of a research collaboration
and option agreement between us and Columbia.2217LS). As of December 31, 2024,2025, other than thean upfront fee,fee of $1.3 million, no payments have been accrued
or paid
in relation to this agreement.
On
June 23, 2023, we entered into an asset purchase agreement with Upsher Smith for the acquisition of certain assets related to
Zembrace and Tosymra (such businesses collectively, the “Business”) and certain inventory related to the Business
for an aggregate purchase price of approximately $26.5 million, including certain deferred payments (such transaction, the “USL
Acquisition”). The transaction closed on June 30, 2023.Tosymra.
Additionally,
in connection with the acquisition from Upsher Smith, we and Upsher Smith entered into a transition services agreement pursuant
to which Upsher Smith agreed to provide certain transition services to us for base fees equal to $100,000 per month for the first
six months, and $150,000 per month for the seventh through ninth months, plus additional monthly fees for each service category
totaling up to $150,000 per month. We have signed an amendment to the transitional services agreement with Upsher Smith so that
Upsher Smith will continue to manage certain government rebates, and Upsher Smith will be reimbursed by us at cost for any rebates
they pay on our behalf.
As
the assets acquired from Upsher Smith met the definition of a business under the current accounting guidance, the total purchase
price was allocated to the acquired inventory and other tangible assets, and the developed technology intangible assets related
to Zembrace and Tosymra based on their estimated fair values on the acquisition date. The excess of the purchase price over the
fair value of the acquired assets was recorded as goodwill.
We
have assumed certain obligations of Upsher Smith, including the payment of quarterly royalty payments on annual net sales from
the Business in the U.S. as follows: for Tosymra, 4% for net sales of $0 to $30 million, 7% of net sales of $30 to $75 million;
9% for net sales of $75 to $100 million; 12% for net sales of $100 to $150 million; and 15% for net sales greater than $150 million.
Royalty payments with respect to Tosymra are payable until the expiration or termination of the product’s Orange Book listed
patent(s) with respect to the United States or, outside the United States, the expiration of the last valid claim covering the
product in the relevant country of the territory. For Zembrace, royalty payments on annual net sales in the U.S. are 3% for net
sales of $0 to $30 million, 6% of net sales of $30 to $75 million; 12% for net sales of $75 to $100 million; 16% for net sales
of greater than $100 million. Such royalty payments arewere payable until July 19, 2025. Upon the entry of a generic version of the
relevant product, the applicable royalty rates will be reduced by 90% percent for Zembrace, and by 66.7% percent for Tosymra.
On
February 2, 2023, we entered into an asset purchase agreement with Healion Bio Inc., pursuant
to which we acquired all the pre-clinical infectious disease assets of Healion for $1.2 million. Because the Healion intellectual
property was acquired prior to FDA approval, the $1.2 million cash consideration was expensed as research and development costs
since there is no alternative future use and the acquired intellectual property does not constitute a business.
As
of December 31, 2024,2025, we had working capital of $100.7$198.0 million, comprised
primarily of cash and cash equivalents of $98.8$207.6 million, accounts
receivable, net of $3.7$6.3 million, inventory of $8.4$6.0 million,million and prepaid
expenses and other of $8.1$9.0 million, offset by $4.5$8.1 million of
accounts payable, $10.7$22.6 million of accrued expensesexpenses, and other current liabilities,
$2.8lease millionliabilities of term$0.1 loan payable, short term and $0.3 million of lease liabilities, short term.million. A significant portion of the accounts
payable and accrued expenses are due to work performed in relation to our clinical programs.programs, accruals for gross to net deductions related
to our commercial products and product launch of TONMYA.
104104
For
the years ended December 31, 2024,2025, and 2023,2024, we used approximately $60.9$99.8 million and $102.0$60.9 million of cash in operating activities, respectively,
respectively, which represents cash outlays for research and development and general and administrative expenses in such periods.
The decrease increase
in cash outlays principally resulted from aan decreaseincrease in researchselling, general and developmentadministrative expense.expenses as a result of the product
launch of TONMYA. Cash used by investing activities for the year ended December 31, 2025, was approximately $4.5 million related
to the issuance of a note and purchase of property and equipment repayment. Cash used by investing activities for the year ended
December 31, 2024, was approximately $0.1 million related to the purchase of property and equipment.
For the year ended December 31, 2025, net proceeds from financing activities were $214.5 million, predominately from the sale of our common stock and warrants, which was offset by repurchase of common stock and repayment of debt. For the year ended December 31, 2024, net proceeds from financing activities were $134.9 million, primarily related to the sale of common stock and warrants.
Cash
used by investing activities for the year ended December 31, 2024, was approximately $0.1 million related to the purchase of property
and equipment. Cash used by investing activities for the year ended December 31, 2023, was approximately $29.1 million related
to the purchase of Zembrace and Tosymra assets and property and equipment.
For
the year ended December 31, 2024, net proceeds from financing activities were $134.9 million, primarily related to the sale of
common stock and warrants. For the year ended December 31, 2023, net proceeds from financing activities were $36.5 million, predominately
from the sale of our common stock and warrants; and debt raised which was offset by repurchase of common stock.
We
believe that our cash resources at December 31, 20242025 and the proceeds that we raised from equity offerings in the first quarter
of 2025,2026, will meet our operating and capital expenditure requirements into the first quarter of 2026, but not beyond.2027.
We
continue to face significant challenges and uncertainties and,and asmust asuccessfully result,launch our available capital resources may be consumed more
rapidly than currently expected due to changes we may make in our researchTONMYA and development spending plans. These factors raise
substantial doubt about our ability to continue as a going concern for the one-year period from the date of filing of this Form
10-K. We must obtain additional funding through
public orand private financing orand collaborative arrangements with strategic partners
to increase the funds available to fund operations.
However, we may not be able to raise capital on terms acceptable to us, or at all. Without the successful product launch of TONMYA
and obtaining additional funds, we may be forced to delay, scale back or eliminate
some or all of our research and development activities,
activities or other operationsoperations, and potentially delay product development in an effort to providemaintain sufficient
funds to continue our
operations. If any of these events occurs, our ability to achieve our development and commercialization
goals wouldwill be adversely affected
and we may be forced to cease operations. The financial statements do not include any adjustments that might result from the outcome
of this uncertainty.
We expect to incur losses from operations for the near future. We expect to increase our operating costs to align the Company’s capital and human resources with its previously announced strategic prioritization of the commercial launch of TONMYA for the treatment of fibromyalgia.
We
expect to incur losses from operations for the near future. We expect to incur increasing research and development expenses, including
expenses related to additional clinical trials and the build out of our research and development operations and manufacturing.
We will not have enough resources to meet our operating requirements for the one-year period from filing date of this report.
Our future capital requirements will depend on a number of factors, including the successful product launch of TONMYA, the progress of our research and development of product candidates, the timing and outcome of regulatory approvals, the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patent claims and other intellectual property rights, the status of competitive products, the availability of financing and our success in developing markets for our product candidates.
We
will need to successfully launch TONMYA and obtain additional capital in order to fund future research and development activities.activities
and future capital expenditures. Future financing may include
the issuance of equity or debt securities, obtaining credit facilities,
or other financing mechanisms. Even if we are able to
raise the funds required, it is possible that we could incur unexpected
costs and expenses, fail to collect significant amounts
owed to us, or experience unexpected cash requirements that would force
us to seek alternative financing. Furthermore, if we issue
additional equity or debt securities, shareholders may experience additional
dilution or the new equity securities may have rights,
preferences or privileges senior to those of existing holders of our common
stock.
If the product launch of TONMYA is unsuccessful and additional financing is not available or is not available on acceptable terms, we may be required to delay, reduce the scope of or eliminate our research and development programs, reduce our commercialization efforts or obtain funds through arrangements with collaborative partners or others that may require us to relinquish rights to certain product candidates that we might otherwise seek to develop or commercialize independently.
105105
December 2025 Financing
On December 29, 2025, we entered into a securities purchase agreement with an institutional investor, pursuant to which we sold 615,025 shares of common stock and pre-funded warrants to purchase up to 615,025 shares of common stock. The offering price per share of common stock was $16.26, and the offering price per share of pre-funded warrant was $16.259.
The offering closed on December 30, 2025. We incurred offering expenses of approximately $1.5 million, including placement agent fees of approximately $1.2 million. We received net proceeds of approximately $18.5 million, after deducting placement agent fees and other offering expenses.
2025 Lincoln Park Transaction
On June 11, 2025, we entered into a purchase agreement (the “2025 Purchase Agreement”) and a registration rights agreement (the “2025 Registration Rights Agreement”) with Lincoln Park. Pursuant to the terms of the 2025 Purchase Agreement, Lincoln Park has agreed to purchase us up to $75,000,000 of our common stock (subject to certain limitations) from time to time during the term of the 2025 Purchase Agreement. Pursuant to the terms of the 2025 Registration Rights Agreement, we filed with the SEC a registration statement to register for resale under the Securities Act the shares that have been or may be issued to Lincoln Park under the 2025 Purchase Agreement.
Pursuant to the terms of the 2025 Purchase Agreement, at the time we signed the 2025 Purchase Agreement and the 2025 Registration Rights Agreement, we issued 48,708 shares of common stock to Lincoln Park as consideration for its commitment to purchase shares of our common stock under the 2025 Purchase Agreement. The commitment shares were valued at $1.8 million and recorded as an addition to equity for the issuance of the common stock and treated as other expense, net on the consolidated statement of operations under the 2025 Purchase Agreement. No shares were sold during the year ended December 31, 2025, under the 2025 Purchase Agreement.
We evaluated the 2025 Purchase Agreement under ASC 815-40 Derivatives and Hedging-Contracts on an Entity’s Own Equity as it represents the right to require Lincoln Park to purchase shares of common stock in the future, similar to a put option. We concluded that the 2025 Purchase Agreement represents a freestanding derivative instrument that does not qualify for equity classification and therefore requires fair value accounting. We analyzed the terms of the contract and concluded that the derivative instrument had insignificant value as of December 31, 2025.
2025 At-the-Market Offering
On June 11, 2025, we entered into a Sales Agreement (the “2025 Sales Agreement”), with A.G.P./Alliance Global Partners (“AGP”) pursuant to which we may issue and sell, from time to time, shares of common stock having an aggregate offering price of up to $400.0 million in sales. AGP is sales agent under the ATM and paid a 3% commission on each sale under the 2025 Sales Agreement. Our common stock is sold at prevailing market prices at the time of the sale, and, as a result, prices will vary. During the year ended December 31, 2025, we sold 4.1 million shares of common stock under the 2025 Sales Agreement, for net proceeds of approximately $104.2 million. Subsequent to December 31, 2025, we sold 0.6 million shares of common stock under the 2025 Sales Agreement, for net proceeds of approximately $8.6 million.
On
July 30, 2024, we entered into a Sales Agreement (the “2024 Sales Agreement”), with AGP pursuant to which we may issue andcould sell,
from time to time, shares of
our common stock having an aggregate offering price of up to $250.0 million in the ATM.sales. AGP will act asis sales agent
under the ATM and will be
paid a 3% commission on each sale under the 2024 Sales Agreement. Our common stock will beis sold at prevailing market
prices at the
time of the sale, and, as a result, prices will vary. During the year ended December 31, 2024,2025, we sold approximately 4.2
4.5 million
shares of common stock under the Sales Agreement,Agreement for net proceeds of approximately $128.4$112.9 million. SubsequentDuring tothe year ended
December 31,
2024, we sold 2.3approximately 4.2 million shares of common stock under the Sales Agreement, as defined below, for net
proceeds of approximately $46.3$128.4 million. We can no longer sell shares under the 2024 Sales Agreement as the
Company has reached the aggregate $250 million in sales.
The
offering closed on July 10, 2024. We incurred offering expenses of approximately $0.5 million, including placement agent fees
of approximately $0.3 million. We received net proceeds of approximately $3.5 million, after deducting theplacement underwritingagent discount
fees and other offering expenses.
The
offering closed on June 13, 2024. We incurred offering expenses of
approximately $0.6 million, including placement agent fees
of approximately $0.3 million. We received net proceeds of approximately $3.4
million, after deducting theplacement underwritingagent discountfees and other offering expenses.
The
offering closed on June 28, 2024. We incurred offering expenses of
approximately $0.6 million, including placement agent fees
of approximately $0.3 million. We received net proceeds of approximately $3.4
million, after deducting theplacement underwritingagent discountfees and other offering expenses.
What changed in the latest 10-Q
Risk Factors
There were no material changes from the risk factors set forth under Part I, Item 1A., “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. You should carefully consider the risk factors set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, as well as other reports and statements that we file and have filed with the SEC, in addition to the other information set forth in this report which could materially affect our business, financial condition or future results. The risks and uncertainties described in this report and in our Annual Report on Form 10-K for the year ended December 31, 2025, as well as other reports and statements that we file with the SEC, are not the only risks and uncertainties facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also have a material adverse effect on our financial position, results of operations or cash flows.
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
New heading “Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025”
Removed heading “Stock Incentive Plans”
Largest changes
“Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025”see in full comparison
see in full comparisonIn August 2025, we received approval from the FDA for TONMYA® (cyclobenzaprine HCl sublingual tablets) for the treatment of fibromyalgia. TONMYA, our first internally developed product to become FDA approved, was commercially launched by us in the United States on November 17, 2025. TONMYA is the first new medicine for fibromyalgia in more than 15 years and is a centrally acting, non-opioid analgesic designed for bedtime administration and long-term use. We hold worldwide commercialization rights to TONMYA. In addition to TONMYA, we market two FDA-approved prescription products for the treatment of acute migraine: Zembrace® SymTouch® (sumatriptan injection) and Tosymra® (sumatriptan nasal spray). Our commercial platform includes sales, marketing, market access, distribution, and patient support capabilities.We are advancing a diversified development pipeline generated through internal discovery, in-licensing, acquisitions, and collaborations with academic and non-profit institutions.OurThe Company’s pipeline addresses conditions that span CNS, infectious disease, immunology, and rare disease, with multiple programs in clinical and preclinical development. TONMYA’s proprietary cyclobenzaprine HCl sublingual tablet formulation is referred to as “TNX-102 SL” outside of the fibromyalgia indication. We are exploring the utility of TNX-102 SL (cyclobenzaprine HCl sublingual tablets) in Phase 2 clinical trials for major depressive disorder (MDD) and acute stress disorder (ASD)/acute stress reaction (ASR).TNX-102ASLpotentiallyis being developed to treat ASD/ASR under an Investigator-Initiated investigational new drug application (“IND”) at the University of North Carolina in the ongoing OASIS study funded by a grant they received from the U.S. Department of Defense (“DoD”). Apivotal Phase 2 study of TNX-102 SLfor MDD is expected to commence mid-2026 underas aTonixfirst-lineINDmonotherapythatinhasadultsbeenwith MDD, the HORIZON study, commencedclearedinbyJuneFDA.2026.
“Cost of Sales. Cost of sales recognized for the six months ended June 30, 2026, was $2.3 million. Cost of sales recognized for the six months ended June 30, 2025, was $4.2 million, including write-downs related to Tosymra and Zembrace finished goods inventory of approximately $2.3 million based on an assessment of inventory on hand and projected sales. The increase in cost of sales, excluding the write-downs, is driven by a change in product mix and sale of product which had previously been written off.”see in full comparison
“Cost of Sales. Cost of sales recognized for the three months ended June 30, 2026 and 2025, was $0.7 million and $3.3 million, respectively. For the three months ended June 30, 2025, cost of sales includes write-downs related to Tosymra and Zembrace finished goods inventory of approximately $2.3 million, based on an assessment of inventory on hand and projected sales. The decrease in cost of sales is driven by a change in product mix and sale of product which had previously been written off.”see in full comparison
For thesee in full comparisonthreesix months endedMarchJune,31, 2026,2026 and 2025, we used approximately$42.3$84.6 million and$16.6$31.4 million of cash in operating activities, respectively, which represents cash outlays for research and development andselling,general and administrative expenses in such periods. The increase in cash outlays principally resulted from an increase in research and development and general, selling and administrative expenses. For thethreesix months endedMarchJune31,30,2026,2026net cash provided by financing activities was $20.2 million, predominately from the proceeds from the sale of our common stock. For the three months ended March 31,and 2025, net cash providedbyfrom financing activities was$49.5$53.7 million and $60.5 million, respectively, predominately from theproceeds from the saleissuance ofourcommonstock of $62.2 million, offset by the repayment of the term loan of $9.7 million and repurchase of our common stock of $3.0 million.stock. Cash usedbyin investing activities for thethreesix months endedendedJuneMarch 31,30, 2026,and 2025,was$1.7$2.3 millionand $6,000 respectively,related to the purchase of property and equipment.TheCash used in investing activities for the sixincreasemonthsisendedpredominatelyJunedue30, 2025, was $2.5 million related tomorethelaboratoryissuanceequipmentofpurchases.a note and purchase of property and equipment.
Full comparison: every changed paragraph (63)
Readers are urged to carefully review and consider the various disclosures
made by us in this report and in our other reports filed with the Securities and Exchange Commission. Important factors known to us could
cause actual results to differ materially from those in forward-looking statements. We undertake no obligation to update
or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in the future operating
results over time. We believe that our assumptions are based upon reasonable data derived from and known about our business and operations.
No assurances are made that actual results of operations or the results of our future activities will not differ materially from our assumptions.
Factors that could cause differences include, but are not limited to: our need for additional financing; risks related to the failure
to successfully market any of our products; risks related to the failure to obtain FDA clearances or approvals and noncompliance with
FDA regulations; risks related to the failure to successfully market any
of our products; risks related to the timing and progress of clinical development of our product candidates; uncertainties of patent protection
and litigation; uncertainties of government or third party payor reimbursement; limited research and development efforts and dependence
upon third parties; and substantial competition.
We market TONMYA® (cyclobenzaprine HCl sublingual tablets) for the treatment of fibromyalgia in adults in the U.S., as well as Zembrace® SymTouch® (sumatriptan injection) and Tosymra® (sumatriptan nasal spray) for the treatment of acute migraine in adults in the U.S. Tonix received approval from the U.S. Food and Drug Administration (“FDA”) for TONMYA for the treatment of fibromyalgia in August 2025 and commercially launched TONMYA in November 2025. TONMYA is our first internally developed product to become FDA approved and is the first new medicine for fibromyalgia in more than 15 years. TONMYA is a centrally acting, non-opioid analgesic designed for bedtime administration and long-term use, for which the Company holds worldwide commercialization rights. Tonix’s commercial platform includes sales, marketing, market access, distribution, and patient support capabilities.
In August 2025, we received approval from the FDA for TONMYA® (cyclobenzaprine
HCl sublingual tablets) for the treatment of fibromyalgia. TONMYA, our first internally developed product to become FDA approved, was
commercially launched by us in the United States on November 17, 2025. TONMYA is the first new medicine for fibromyalgia in more than
15 years and is a centrally acting, non-opioid analgesic designed for bedtime administration and long-term use. We hold worldwide commercialization
rights to TONMYA. In addition to TONMYA, we market two FDA-approved prescription products for the treatment of acute migraine: Zembrace®
SymTouch® (sumatriptan injection) and Tosymra® (sumatriptan nasal spray). Our commercial platform includes sales, marketing,
market access, distribution, and patient support capabilities. We are advancing a diversified
development pipeline generated through internal
discovery, in-licensing, acquisitions, and collaborations with academic and non-profit
institutions. OurThe Company’s pipeline addresses conditions
that span CNS, infectious disease, immunology, and rare disease, with
multiple programs in clinical and preclinical development. TONMYA’s
proprietary cyclobenzaprine HCl sublingual tablet formulation
is referred to as “TNX-102 SL” outside of the fibromyalgia indication.
We are exploring the utility of TNX-102 SL (cyclobenzaprine
HCl sublingual tablets) in Phase 2 clinical trials for major depressive disorder (MDD) and acute stress disorder (ASD)/acute
stress reaction
(ASR). TNX-102A SLpotentially is being developed to treat ASD/ASR under an Investigator-Initiated investigational new drug application
(“IND”) at the University of North Carolina in the ongoing OASIS study funded by a grant they received from the U.S. Department
of Defense (“DoD”). Apivotal Phase 2 study of TNX-102 SL for MDD is expected to commence mid-2026 underas a Tonixfirst-line INDmonotherapy thatin hasadults beenwith MDD, the HORIZON study, commenced
clearedin byJune FDA.2026.
TNX-102 SL is being developed to treat ASD/ASR under an Investigator-Initiated investigational new drug application (“IND”) at the University of North Carolina in the ongoing OASIS study funded by a grant they received from the U.S. Department of Defense (“DoD”). Topline data from the OASIS study is expected to be reported mid-2027.
Our clinical stage infectious disease portfolio includes monoclonal antibody TNX-4800 (anti Borrelia OspA human monoclonal antibody) for the prevention of Lyme disease in the U.S. which has no FDA-approved vaccines or prophylactics. We received positive, final minutes from the FDA following a Type C meeting in early third quarter of 2026. The minutes support the planned initiation of an adaptive Phase 2 field in the first quarter of 2027. TNX-4800 was licensed from UMass Chan Medical School. Our clinical-stage immunology development portfolio includes TNX-1500, which is a Phase 2 ready Fc-modified humanized monoclonal antibody targeting CD40-ligand (CD40L or CD154) being developed for the prevention of kidney transplant rejection, and for the treatment of autoimmune diseases. A Phase 2, open-label, investigator-initiated study in adult kidney transplant patients at Massachusetts General Hospital (MGH) is expected to initiate in the second half of 2026 pending FDA clearance of MGH’s IND application. Another CNS candidate in clinical development is TNX-1300 (double-mutant cocaine esterase), which is in Phase 2 for the treatment of cocaine intoxication. TNX-1300 has been granted Breakthrough Therapy designation by the FDA and a Phase 2a study was completed. We intend to meet with the FDA in 2026 to help inform the clinical design of its next Phase 2 study. Finally, our clinical-stage rare disease portfolio includes TNX-2900, intranasal oxytocin potentiated with magnesium, in development for Prader-Willi syndrome and expected to start a Phase 2 study in the second half of 2027.
Our clinical stage
infectious disease portfolio includes monoclonal antibody TNX-4800 (anti-Borrelia OspA human monoclonal antibody) for the
prevention of Lyme disease in the U.S., for which initiation of an adaptive Phase 2 field study is planned for the first half of
2027, pending FDA agreement. TNX-4800 was licensed from UMASS Chan Medical School. Our clinical-stage immunology development
portfolio consists of biologics to address organ transplant rejection and autoimmunity, including TNX-1500, which is a Phase 2-ready
Fc-modified humanized monoclonal antibody targeting CD40-ligand (CD40L or CD154) being developed for the prevention of kidney
transplant rejection. Another CNS candidate in clinical development is TNX-1300 (double-mutant cocaine esterase), which is in Phase
2 for the treatment of cocaine intoxication. TNX-1300 has been granted Breakthrough Therapy designation by the FDA and a Phase 2a
study was completed. However, because of the challenges of recruiting eligible patients into a subsequent Phase 2 study, we
terminated that study and intend to meet with the FDA in 2026 to inform the clinical design of our next Phase 2 study. Our
clinical-stage rare disease portfolio includes TNX-2900, intranasal oxytocin potentiated with magnesium, in development for
Prader-Willi syndrome and expected to start a Phase 2 study in the first quarter of 2027. Our pre-clinical, pre-IND infectious
disease portfolio includes TNX-801 (horsepox,
live virus vaccine), as a potential vaccine for mpox and smallpox.smallpox, which is expected to enter a Phase 1 study in 2027 pending FDA clearance
of an IND. We own a facility
in Dartmouth, MA that was purpose-built to manufacture TNX-801 under Good Manufacturing Practices (GMP) to
support clinical
development and potential commercialization. The facilityGMP wassuites were decommissioned in 2024 and may be reactivated on the earlier
of 2027
2028 or in the case of a national or international emergency. Our pre-IND infectious disease portfolio also includes TNX-4200, which
is a
small molecule broad-spectrum antiviral agent targeting CD45 for the prevention or treatment of high lethality infections to improve
the medical readiness of military personnel in biological threat environments. The TNX-4200 program is supported by a $34 million contract
contract over five years from the U.S. DoD’s Defense Threat Reduction Agency (DTRA). We own and operate a state-of-the art
research facility
in Frederick, Maryland that supports this research. Our pre-IND pre-clinical immunology portfolio includes
TNX-1700, which is a fusion
protein of TFF2 and albuminalbumin, is in preclinical development for the treatment of gastric and colorectal
cancer in combination with PD-1
blockade in collaboration with Columbia University. Finally, our pre-clinical, pre-IND CNS portfolio
also includes TNX-4900, a highly
selective small-molecule Sigma-1 receptor (“S1R”) antagonist for neuropathic pain
licensed from Rutgers University.
Three
Months Ended MarchJune 31,30, 2026
Compared to Three Months Ended MarchJune 31,30, 2025
The
following table sets forth our operating
expenses results for the three monthsquarter ended MarchJune 31,30, 2026 and 2025 (in thousands):
Revenues. Revenue recognized for the three months ended June 30, 2026 and 2025, was $13.5 million and $2.0 million, respectively. The increase is predominately due to the launch of TONMYA in November 2025. Gross-to-net allowances decreased by approximately $1.3 million due to changes in prior estimates related to a prior year resulting in an additional $1.3 million of revenue being recognized during the three months ended June 30, 2026.
Revenues.
Revenue recognized for the three months ended March 31, 2026 and 2025, was $6.9 million and $2.4 million, respectively.
Cost of Sales. Cost of sales recognized for the three months ended June 30, 2026 and 2025, was $0.7 million and $3.3 million, respectively. For the three months ended June 30, 2025, cost of sales includes write-downs related to Tosymra and Zembrace finished goods inventory of approximately $2.3 million, based on an assessment of inventory on hand and projected sales. The decrease in cost of sales is driven by a change in product mix and sale of product which had previously been written off.
Cost of Sales.
Cost of sales recognized for the three months ended March 31, 2026 and 2025, was $1.6 million and $0.9 million, respectively. The
increase is predominantly due to the launch of Tonmya in November 2025.
Research
and and
Development Expenses. Research and development expenses for the three months ended MarchJune 31,30, 2026,2026 were $18.2$19.4 million,
an increase of $10.8$8.6 million, or 146%,80%, from $7.4$10.8 million for the three months ended MarchJune 31,30, 2025. TheThis increase is predominately
due to increased clinical expenses of $0.8$1.3 million, non-clinical expenses of $0.4 million,million and manufacturing expenses of $6.6$4.5 million
as a result of advancing our prioritized pipeline prioritization period over period, andas well as increased employee-related expensescosts of $2.5 million due to an increased workforce
predominately as a result of the launch of TONMYA in November 2025.headcount.
The
table below summarizes
our direct research and development expenses for our product candidates and development platform for the
three months ended March
31,June 30, 2026, and 2025.
Our direct research and development expenses consist principally of external costs for clinical, nonclinical and manufacturing, such as fees paid to contractors, consultants and CROs in connection with our development work. Included in “Internal Staffing, Overhead and Other” is overhead, supplies, research and development employee costs (including stock option expenses), travel, regulatory and legal.
Selling, General and Administrative Expenses. Selling, general and administrative expenses for the three months ended June 30, 2026 were $36.0 million, an increase of $19.8 million, or 122%, from $16.2 million incurred in the three months ended June 30, 2025. The increase is primarily due to an increase in sales and marketing expenses of $13.8 million, employee-related expenses of $3.8 million, and professional expenses of $1.9 million. All increases are a result of the migraine assets program and launch of TONMYA.
Net Loss. As a result of the foregoing, the net loss for the three months ended June 30, 2026 was $40.6 million, an increase of $12.3 million, or 43%, compared to a net loss of $28.3 million for the three months ended June 30, 2025.
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
The following table sets forth our operating results for the six months ended June 30, 2026 and 2025 (in thousands):
Revenues. Revenue recognized for the six months ended June 30, 2026 and 2025, was $20.4 million and $4.4 million, respectively. The increase is predominately due to the launch of TONMYA in November 2025. Gross-to-net allowances decreased by approximately $2.8 million due to changes in prior estimates related to a prior year resulting in an additional $2.8 million of revenue being recognized during the six months ended June 30, 2026.
The Company’s net product revenues are summarized below:
Cost of Sales. Cost of sales recognized for the six months ended June 30, 2026, was $2.3 million. Cost of sales recognized for the six months ended June 30, 2025, was $4.2 million, including write-downs related to Tosymra and Zembrace finished goods inventory of approximately $2.3 million based on an assessment of inventory on hand and projected sales. The increase in cost of sales, excluding the write-downs, is driven by a change in product mix and sale of product which had previously been written off.
Research and Development Expenses. Research and development expenses for the six months ended June 30, 2026 were $37.6 million, an increase of $19.4 million, or 106%, from $18.3 million for the six months ended June 30, 2025. This increase is predominately due to clinical expenses of $2.1 million and manufacturing expenses of $11.1 million as a result of advancing our prioritized pipeline programs period over period, as well as increased employee-related expenses of $5.0 million as a result increased headcount.
The table below summarizes our direct research and development expenses for our product candidates and development platform for the six months ended June 30, 2026, and 2025.
Selling,
General General
and Administrative Expenses. GeneralSelling, general and administrative expenses for the threesix months ended MarchJune 31, 2026,30,
2026 were $28.6
$64.6 million, an increase of $18.5$38.3 million, or 183%,146%, from $10.1$26.3 million incurred in the threesix months ended MarchJune 31,30, 2025.
The increase
is primarily due to an increase inincreased sales and marketing of $11.3$24.7 million, an increase in employee relatedemployee-related expenses of $3.9$7.8 million,million and
and increased professional feesexpenses of $2.7$4.7 million,million. predominatelyAll asincreases are a result of the migraine assets program and launch of TONMYA in November 2025.TONMYA.
Net
Loss. As a result of the forgoing,foregoing, the net loss for the threesix months ended MarchJune 31,30, 2026,2026 was $40.2$80.7 million, an increase
of $35.6 million, or 79%, compared to a net loss of $16.8$45.1 million for the threesix months ended MarchJune 31,30, 2025, an increase of $23.4 million or 139%. The
increase in loss is predominately due to increased spending on research and development and selling, general and administrative
expenses.2025.
As
of MarchJune 31,30, 2026, we had working capital of $177.5$172.6 million, comprised
primarily of cash and cash equivalents of $185.5$176.2 million,
accounts receivable, net of $8.8$11.8 million, inventory of $3.6$4.7 million,million and prepaid
expenses and other of $9.2$10.7 million, offset by $9.7
$9.1 million of accounts payable, $19.8$21.5 million of accrued expensesexpenses, and other current liabilities,
andlease $0.2 millionliabilities of lease$0.3 liabilities, short term.million. A significant
portion of the accounts payable and accrued expenses are due to work
performed in relation to our clinical programs, and accruals
for gross to net deductions related to our commercial products.products and launch of TONMYA.
The
following table
provides a summary of operating, investing and financing cash flows for the quarterssix months ended MarchJune 31,30, 2026, and
2025, respectively
(in thousands):
For
the threesix months
ended MarchJune, 31, 2026,2026 and 2025, we used approximately $42.3$84.6 million and $16.6$31.4 million of cash in operating activities,
respectively, which
represents cash outlays for research and development and selling, general and administrative expenses in such periods.
The increase in cash outlays principally resulted from an increase in research and development and general, selling and administrative
expenses. For the
three six months ended MarchJune 31,30, 2026,2026 net cash provided by financing activities was $20.2 million, predominately from the proceeds
from the sale of our common stock. For the three months ended March 31,and 2025, net cash provided byfrom financing activities was $49.5$53.7 million and $60.5
million, respectively, predominately from the proceeds from the saleissuance of our common stock of $62.2 million, offset by the repayment of the term
loan of $9.7 million and repurchase of our common stock of $3.0 million.stock. Cash used byin investing activities for the threesix months ended
endedJune March 31,30, 2026, and 2025, was $1.7$2.3 million and $6,000 respectively, related to the purchase of property and equipment. TheCash used in investing activities for the six
increasemonths isended predominatelyJune due30, 2025, was $2.5 million related to morethe laboratoryissuance equipmentof purchases.a note and purchase of property and equipment.
We
believe that our cash resources at MarchJune 31,30, 2026, and the net proceeds
of $22.6 million that we raised from equity offerings induring the secondthird quarter
of 2026 (See Note 12)2026, will meet our planned operating and
capital expenditure requirements into early second quarter of 2027, but will not extend to
12 months from the issuance of these financial
statements.
On
June 11, 2025, we
entered into a purchase agreement (the “2025 Purchase Agreement”) and a registration rights agreement
(the “2025
Registration Rights Agreement”) with Lincoln Park.Park Capital Fund, LLC (“Lincoln Park”). Pursuant
to the terms of the 2025 Purchase Agreement, Lincoln Park has
agreed to purchase from us up to $75,000,000 of our common stock
(subject to certain limitations) from time to time during the term
of the 2025 Purchase Agreement. Pursuant to the terms of the
2025 Registration Rights Agreement, we filed with the SEC a registration
statement to register for resale under the Securities
Act the shares that have been or may be issued to Lincoln Park under the
2025 Purchase Agreement.
Pursuant
to the terms
of the 2025 Purchase Agreement, at the time we signed the 2025 Purchase Agreement and the 2025 Registration Rights
Agreement, we
issued 48,708 shares of common stock to Lincoln Park as consideration for its commitment to purchase shares of our
common stock
under the 2025 Purchase Agreement. The commitment shares were valued at $1.8 million and recorded as an addition
to equity for
the issuance of the common stock and treated as other expense, net on the condensed consolidated statement of operations
under the 2025 Purchase
Agreement. No shares were sold during the2026 quarterand ended March 31, 2026,2025 under the 2025 Purchase Agreement.
We
evaluated the 2025
Purchase Agreement under ASC 815-40 Derivatives and Hedging-Contracts on an Entity’sEntity's Own
Equity as it represents the
right to require Lincoln Park to purchase shares of common stock in the future,
similar to a put option. We concluded that the
2025 Purchase Agreement represents a freestanding derivative instrument that does not qualify
for equity classification and therefore
requires fair value accounting. We analyzed the terms of the contract and concluded that
the derivative instrument had insignificant
value as of MarchJune 31,30, 2026 and December 31, 2025.
2025
At-the-Market OfferingOfferings
On
June 11, 2025, we
entered into a Sales Agreement (the “2025 Sales Agreement”), with A.G.P./Alliance Global Partners
(“AGP”) pursuant
to which we may issue and sell, from time to time, shares of common stock having an aggregate offering
price of up to $400.0 million
in sales. AGP is the sales agent under the ATM and paid a 3% commission on each sale under the 2025
Sales Agreement. Our common stock is
sold at prevailing market prices at the time of the sale, and, as a result, prices will vary.
During the quartersix months ended MarchJune 31,30, 2026,
we sold 1.44.0 million shares of common stock under the 2025 Sales Agreement, for net
proceeds of approximately $20.1$53.6 million. Subsequent
to MarchJune 31,30, 2026, we sold 1.70.3 million shares of common stock under the 2025
Sales Agreement, for net proceeds of approximately $22.6$3.7 million. No shares were sold during the six months ended June 30, 2025,
million.under the 2025 Sales Agreement.
2024
At-the-Market OfferingOfferings
On
July 30, 2024, we
entered into a Sales Agreement (the “2024 Sales Agreement”), with AGP pursuant to which we may issue
and sell, from time to time, shares of our common stock
having an aggregate offering price of up to $250.0 million in the ATM.sales. AGP will act asis
the sales agent under the ATM and will be paid a 3% commission
on each sale under the 2024 Sales Agreement. Our common stock will beis sold at
prevailing market prices at the time of the sale, and,
as a result, prices will vary. During the three and six months ended March 31,June
30, 2025, we sold approximately 2.70.8 million and 3.5 million shares, respectively, of common stock under the 2024 Sales Agreement
for net proceeds of approximately $15.5 million and $75.4 million, respectively. Subsequent to June 30, 2025, we sold 0.9 million
shares of common
stock under the 2024 Sales Agreement, for net proceeds of approximately $59.8$37.5 million. We can no longer sell
shares under the 2024 Sales Agreement as we have reached the aggregate $250 million in sales.
ShareStock
Repurchase Programrepurchases
In
September 2024, the Board of Directors approved a 2024 share repurchase
program pursuant to which we
may repurchase up to $10.0 million in value of its outstanding common stock from time to
time on the open market and in
privately negotiated transactions subject to market conditions, share price and other
factors. During the three months ended
June March 31,30, 2025, the Companywe repurchased 250,000150,000 of
shares of its common stock outstanding under the 2024 share repurchase program at prices
ranging from $9.98$18.25 to $14.33$20.47 per share for a gross
aggregate cost of approximately $3.0$2.9 million. NoThe repurchased shares ofwere
immediately common stock were repurchased
during the three months ended March 31, 2026.retired.
We repurchased the following capital stock:
During the six months ended June 30, 2025, we repurchased 400,000 of shares of common stock outstanding under the 2024 share repurchase program at prices ranging from $9.98 to $20.47 per share for a gross aggregate cost of approximately $5.9 million. The repurchased shares were immediately retired.
We repurchased the following capital stock:
Stock Incentive Plans
On May 1, 2020, our
stockholders approved the Tonix Pharmaceuticals Holding Corp. Amended and Restated 2020 Stock Incentive Plan (“Amended and
Restated 2020 Plan”).
UnderOn
May 7, 2026, our stockholders approved the termsTonix ofPharmaceuticals Holding Corp. 2026 Stock Incentive Plan (the “2026 Plan”),
which replaced the Tonix Pharmaceuticals Holding Corp. Amended and Restated 2020 Stock Incentive Plan Under
the terms of the 2026 Plan, we may issue (1) stock options (incentive and nonstatutory), (2) restricted stock, (3) stock
appreciation rights (“SARs”), (4) restricted stock units,RSUs, (5) other stock-based awards, and (6) cash-based awards.
The Amended and Restated 20202026 Plan initially
provided for the issuance of up to 50,0001,000,000 shares of common stock, which amount will
be increased to the extent that awards
granted under the Plans2026 Plan are forfeited, expire or are settled for cash (except as otherwise
provided in the Amended and Restated 20202026 Plan). In
addition, the Amended and Restated 20202026 Plan contains an “evergreen provision”
providing for an annual increase in the number of shares of
our common stock available for issuance under the Amended and Restated
20202026 Plan on January 1 of each year for a period of ten years, commencing on
January 1, 20212027\ and ending on (and including) January
1, 2030,2036, in an amount equal to the greater of a) difference between (x)
twenty percent (20%) of the total number of shares of common stock outstanding
on December 31st of the preceding calendar year,year
calculated on a fully diluted basis, and (y) the total number of shares of common stock reserved under the
Amended and Restated 20202026 Plan on December
31st of such preceding calendar year (including shares subject to outstanding
awards, issued pursuant to awards or
available for future awards). The Board of Directors determines the exercise price, vesting
and expiration(b) periodfive percent (5%) of the grantstotal under the Amended and Restated 2020 Plan. However, the exercise pricenumber of an incentive stock
option may not be less than 110%shares of fairstock valueoutstanding as of December 31st of the
preceding commoncalendar stockyear, atcalculated the date of the grant foron a 10%fully ordiluted more shareholder and 100%
of fair value for a grantee who is not a 10% shareholder. The fair value of the common stock is determined based on quoted market
price or in absence of such quoted market price, by the Board of Directors in good faith. Additionally, the expiration period of
grants under the Amended and Restated 2020 Plan may not be more than ten years. As of March 31, 2026, there were 425,649 options
available for future grants under the Amended and Restated 2020 Plan.basis.
The Board of Directors determines the exercise price, vesting and expiration period of the grants under the 2026 Plan. However, the exercise price of an incentive stock option may not be less than 110% of fair value of the common stock at the date of the grant for a 10% or more shareholder and 100% of fair value for a grantee who is not a 10% shareholder. The fair value of the common stock is determined based on quoted market price or in absence of such quoted market price, by the Board of Directors in good faith. Additionally, the expiration period of grants under the 2026 Plan may not be more than ten years. As of June 30, 2026, there were 808,100 options available for future grants under the 2026 Plan.
On May 8, 2025, the
Company's stockholders approved the addition of 1,000,000 shares to the Company's Amended and Restated 2020 Plan.
We measure the fair
value of stock options on the date of grant, based on the Black Scholes option pricing model using certain assumptions discussed
below, and the closing market price of the Company’s common stock on the date of the grant. The fair value of the award is
measured on the grant date. One-third of most stock options granted pursuant to the Plans vest 12 months from the date of grant
and 1/36th each month thereafter for 24 months and expire ten years from the date of grant. In addition, the Company
issues options to directors which vest over a one-year period. The Company also issues premium options to executive officers which
have an exercise price greater than the grant date fair value and has issued performance-based options which vest when target parameters
are met or probable of being met, subject in each case to a one year minimum service period prior to vesting. Stock-based compensation
expense related to awards is amortized over the applicable service period using the straight-line method.
The risk-free interest rate is based on the yield of Daily U.S. Treasury
Yield Curve Rates with terms equal to the expected term of the options as of the grant date. The expected term of options is determined
using the simplified method, as provided in an SEC Staff Accounting Bulletin, and the expected stock price volatility is based on
the Company’s historical stock price volatility.
The
weighted average
fair value of options granted forduring the three-monththree periodsand six months ended MarchJune 31,30, 2026 and 2025 was $13.4$11.95 per share and $7.55$13.15
per share, respectively. The weighted average fair value of options granted during the three and six months ended June 30, 2025
was $19.63 per share and $12.59 per share, respectively.
We measure the fair value of stock options on the date of grant, based on the Black Scholes option pricing model using certain assumptions discussed below, and the closing market price of our common stock on the date of the grant. The fair value of the award is measured on the grant date. One-third of most stock options granted pursuant to the Plans vest 12 months from the date of grant and 1/36th each month thereafter for 24 months and expire ten years from the date of grant. In addition, we issue options to directors which vest over a one-year period. We also issue premium options to executive officers which have an exercise price greater than the grant date fair value and has issued performance-based options which vest when target parameters are met or probable of being met, subject in each case to a one year minimum service period prior to vesting. Stock-based compensation expense related to awards is amortized over the applicable service period using the straight-line method.
Stock-based compensation
expense relating to options granted of $1.9 million, of which $1.3 million and $0.6 million, related to Selling, General and Administration
and Research and Development, respectively, was recognized for the three months ended March 31, 2026.
Stock-based
compensation compensation
expense relating to options granted of $0.9$2.3 million, of which $0.6$1.6 million and $0.3$0.7 million, related to Selling, General and
Administration Administration
and Research and Development, respectively,respectively was recognized for the three monthsquarter ended MarchJune 31,30, 2026. Stock-based
compensation expense relating to options granted of $1.4 million, of which $1.0 million and $0.4 million, related to General and
Administration and Research and Development, respectively was recognized for the quarter ended June 30, 2025.
Stock-based compensation expense relating to options granted of $4.2 million, of which $2.9 million and $1.3 million, related to General, Selling and Administration and Research and Development, respectively was recognized for the six-month period ended June 30, 2026. Stock-based compensation expense relating to options granted of $2.3 million, of which $1.6 million and $0.7 million, related to General, Selling and Administration and Research and Development, respectively was recognized for the six-month period ended June 30, 2025.
As
of MarchJune 31,30, 2026,
we had approximately $23.3$22.6 million of total unrecognized compensation cost related to non-vested awards granted
under the Plans,
which thewe Company expectsexpect to recognize over a weighted average period of 3.363.11 years.
Employee
Stock Purchase PlanPlans
On
May 5, 2023, our
stockholders approved the Tonix Pharmaceuticals HoldingsHolding Corp. 2023 Employee Stock Purchase Plan. (the “2023
ESPP”),
which was replaced by the Tonix Pharmaceuticals HoldingsHolding Corp. 2025 Employee Stock Purchase Plan (the “2025
ESPP”,
and together with the 2023 ESPP, the “ESPP Plans”), which was approved by our stockholders on May 8,
2025.
The
2025 ESPP allows
eligible employees to purchase up to an aggregate of 2,000,000 shares of the Company'sour common stock. Under the 2025 ESPP,
on the
first day of each offering period, each eligible employee for that offering period has the option to enroll for that offering
period, period,
which allows the eligible employees to purchase shares of the Company'sour common stock at the end of the offering period. Each offering
period under the 2025 ESPP is for six months, which can be modified from time to time. Subject to limitations, each participant
will be permitted to purchase a number of shares determined by dividing the employee'semployee’s accumulated payroll deductions for
the offering
period by the applicable purchase price, which is equal to 85 percent of the fair market value of our common stock
at the beginning
or end of each offering period, whichever is less. A participant must designate in his or her enrollment package
the percentage
(if any) of compensation to be deducted during that offering period for the purchase of stock under the 2025 ESPP,
subject to the
statutory limit under the Code.
The
2023 ESPP allows
eligible employees to purchase up to an aggregate of 250 shares of the Company’sour common stock. Under the 2023 ESPP, on
on the first day of each offering period, each employee eligible employee for that offering period has the option to enroll for that offering
period, which allows the eligible employees to purchase shares of the Company’sour common stock at the end of the offering period.
Each offering
period under the 2023 ESPP is for six months, which can be modified from time-to-time. Subject to limitations, each participant
participant will be permitted to purchase a number of shares determined by dividing the employee’s accumulated payroll
deductions for
the offering period by the applicable purchase price, which is equal to 85 percent of the fair market
value of our common stock
at the beginning or end of each offering period, whichever is less. A participant must designate in his
or her enrollment package
the percentage (if any) of compensation to be deducted during that offering period for the purchase of
stock under the 2023 ESPP,
subject to the statutory limit under the Code. As of MarchJune 31,30, 2026, 159 shares were available for future
sales under the 2023
ESPP and 1,994,117 shares were available under the 2025 ESPP.
The
ESPP Plans are
considered compensatory plans with the related compensation cost expensed over the six-month offering period. For
the threesix months
ended MarchJune 31,30, 2026 and 2025, $0.1$0.2 million and $0, respectively, were expensed. As of December 31, 2025, approximately
$90,000 $90,000
of employee payroll deductions had accumulated and had been recorded in accrued expenses. In January 2026, 5,883 shares
that were
purchased as of December 31, 2025, under the 2025 ESPP, were issued.
TNXP insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 5 Form 4 filings (4 insiders, 5 trade dates, 14,415 shares, about $172.3K) and open-market sales in 0 filings. Net open-market shares: 14,415 (purchases minus sales); net value about $172.3K.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-08-27 | Lederman Seth |
Open-market purchase | 2,000 | $13.79 | $27.6K |
| 2026-08-20 | Bagger Richard H |
Open-market purchase | 1,000 | $12.60 | $12.6K |
| 2026-06-30 | Saenger Bradley |
Other | 1,453 | $10.91 | $15.9K |
| 2026-06-12 | Taylor Carolyn E. |
Open-market purchase | 1,415 | $10.55 | $14.9K |
| 2026-06-09 | Lederman Seth |
Open-market purchase | 5,000 | $11.79 | $59.0K |
| 2026-06-08 | Stillwell Richard Newcomb |
Open-market purchase | 5,000 | $11.65 | $58.2K |
Well-known investors holding TNXP (13F)
None of the 59 investors we track reported a position in their latest 13F.