Note 4 – In-Process Research and Development

In December of 2022, in connection with a business combination, the Company recorded an indefinite-lived intangible asset related to in-process research and development (“IPR&D”). ASC 350 requires that intangible assets with indefinite lives be tested for impairment annually or on an interim basis if events or circumstances indicate that the fair value of an asset has decreased below its carrying value. As of September 30, 2025, management determined that it was more likely than not that the Company’s single reporting unit’s fair value was below its carrying amount, due to a significant and sustained decline in the Company’s market capitalization through September 30, 2025, therefore an impairment test was performed on the Company’s IPR&D intangible asset.

Current limitations on accessing significant capital in what is currently a risk averse environment for biotech (as evidenced by decreased investor appetite for risk, market volatility, regulatory uncertainty from a changing Food and Drug Administration and a challenging economic environment), has resulted in a sustained decline in the Company’s market capitalization, and the Company’s ability to further finance the development of its drug candidates to the next milestone could be adversely impacted. Accordingly, the Company determined that the carrying value of its IPR&D intangible asset may not be recoverable and it was fully impaired. Therefore, the Company recorded an $18.6 million impairment charge, reflected within operating expenses in the condensed consolidated statements of operations for the three and nine months ended September 30, 2025.