Skye Bioscience Inc.

08/14/2026 | Press release | Distributed by Public on 08/14/2026 07:40

Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements (unaudited) for the three and six months ended June 30, 2026 and 2025, together with the notes thereto and the consolidated financial statements and the related notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the Securities and Exchange Commission (SEC) on March 10, 2026.
Solely for convenience, certain trademark and service marks (the "marks") referred to in this Quarterly Report on Form 10-Q
appear without the ® or ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to
the fullest extent under applicable law, our rights to these marks.
Unless otherwise provided in this Quarterly Report on Form 10-Q, references to "we," "us," "our" and "Skye" in this discussion and analysis refer to Skye Bioscience, Inc., a Nevada corporation, together with its consolidated subsidiaries.
Overview
We are a clinical stage company with lead clinical candidate, nimacimab, a peripherally restricted negative allosteric modulating antibody targeting cannabinoid receptor 1 ("CB1")-a key GPCR involved in metabolic regulation that is administered as a subcutaneous injectable initially for the treatment of obesity and overweight.
Results of CBeyond Phase 2a Proof-of-Concept Trial
We completed CBeyondTM, a Phase 2a proof-of-concept clinical trial of nimacimab administered as a subcutaneous injectable for the treatment of obesity and overweight in the United States. The randomized, placebo- and active-controlled, double-blind CBeyond Phase 2a trial enrolled 136 adults with obesity or overweight, including individuals with a BMI ≥27 kg/m² with at least one comorbidity. Patients were randomized across four arms, 2:2:1:1 to arms with weekly nimacimab 200 mg subcutaneously, placebo, nimacimab 200 mg plus semaglutide (Wegovy®), or placebo plus semaglutide, and were dosed weekly for 26 weeks. Patients not participating in a 26-week extension were monitored for 13 weeks post-treatment.
In October 2025, we announced topline results from our CBeyond Phase 2a proof-of-concept clinical trial of nimacimab administered as a subcutaneous injectable for the treatment of obesity and overweight in the United States. Nimacimab monotherapy arm did not achieve the primary endpoint of weight loss compared to placebo (-1.52% vs. -0.26 for placebo, mITT). Preliminary pharmacokinetic analysis suggested an association between exposure and response, indicating that the 200 mg, subcutaneous weekly dose was suboptimal as a monotherapy. At the tested dose and exposure levels, nimacimab 200 mg demonstrated a favorable safety profile with placebo-like tolerability. In combination with semaglutide, there was no increase in gastrointestinal (GI) adverse events. Importantly, there were no increases in neuropsychiatric adverse events reported resulting from treatment with nimacimab. In the combination arm, nimacimab 200 mg, subcutaneous weekly dose plus semaglutide demonstrated a clinically meaningful magnitude of weight loss compared to semaglutide alone (-13.2% vs -10.25%, p=0.0372, mITT), with no plateau being observed through Week 26.
Patients who completed 26 weeks of treatment in the Phase 2a study were eligible to enroll in a 26-week extension for a potential full treatment duration of 52 weeks with a 13-week follow-up period. A total of 43 patients were enrolled, with 19 and 24 patients in the combination and monotherapy cohorts, respectively. In the combination arms, continued with blinded treatment with nimacimab or placebo and continued receiving semaglutide (Wegovy®). Patients in the monotherapy arm received nimacimab 300 mg during the extension.
19 participants in the combination cohorts completed week 26 were eligible for, and enrolled in the extension study. Seven participants in the combination group completed the additional 26 weeks of treatment lost an additional 7.9% of weight, resulting in a mean weight loss of 22.3% . According to initial results in this limited cohort, the combination therapy remained safe and well tolerated. No SAEs or AESIs were reported during the extension period. Moreover, the 7 participants in the semaglutide-alone group completed treatment of the additional 26 weeks and lost an additional -5.8% of weight during the extension period, resulting in a mean weight loss of -19.7%. Full topline reporting of the CBeyond Phase 2a extension data including nimacimab monotherapy data and 13-week off-therapy follow-up has not yet been reported.
We believe multiple factors may have resulted in the lower than anticipated weight loss results for nimacimab as a monotherapy, including a lower systemic exposure than originally modeled, and a better understanding of tissue exposure required to drive weight loss with peripheral CB1 inhibition.
In March 2026, we initiated an expansion study (Part C) of the CBeyond Phase 2a trial to assess preliminary safety and pharmacokinetic (PK) profile of nimacimab administered intravenously (IV). The expansion study comprised of two cohorts of nimacimab monotherapy (400 mg IV and 600 mg IV) compared to placebo administered weekly over 15 weeks (16 doses), with a 12 week follow up period, to generate preliminary monotherapy safety, PK, and exploratory efficacy data. Within each dose cohort, 8 participants will be randomized in a 3:1 ratio to nimacimab (n=6) or placebo (n=2). On May 20, 2026 we announced
that the Cohort Review Committee (CRC) responsible for reviewing safety data generated from the CBeyond Part C Expansion Study, and for approving the opening of enrollment in Cohort 2 has unanimously approved opening the second cohort of the CBeyond Part C Expansion study.
Recent Developments
Termination of CBeyond Study
With recent approvals of oral versions of GLP-1 receptor agonists (WEGOVY and FOUNDAYO), combined with continued development GLP-1, GIP, glucagon triple agonists, such as retatrutide demonstrating greater than 25% weight loss, Skye management determined that nimacimab's current target product profile which included at least a 600mg once-weekly dose, or 6 mL weekly injection, may not significantly penetrate the increasingly competitive anti-obesity medicine market. As a result, the Company terminated all clinical activities related to CBeyond, including enrollment for the CBeyond expansion (Part C) study, and paused all R&D activities associated with nimacimab in order to evaluate strategic options. In addition, the Company instituted multiple cost-cutting measures, including but not limited to, a reduction in workforce and termination of certain vendor contracts and licensing agreements.
Transaction with Redx Pharma Limited
On August 14, 2026, we entered into a transaction agreement ("Transaction Agreement") with Redx Pharma Limited with registered number 07368089 ("Redx"), a private limited company incorporated in England and Wales. Pursuant to the Transaction Agreement, and subject to the terms and conditions set forth therein, we will acquire the entire issued and to be issued share capital of Redx pursuant to a scheme of arrangement under Part 26 of the United Kingdom Companies Act 2006 (the "Scheme of Arrangement" and such transaction, the "Transaction"). Upon the consummation of the Transaction, the combined company will be led by the Redx management team and plans to operate under the name Fibrx Therapeutics, Inc. The Transaction Agreement was unanimously approved by our board of directors and is subject to certain customary closing conditions, including the approval by the stockholders of each company. See Note 11 Subsequent Events for additional information.
Company Contingent Value Rights Agreement
Immediately prior to the Effective Time, the Company and a rights agent are expected to enter into a contingent value rights agreement (the "Legacy CVR Agreement"), pursuant to which holders of record of Common Stock as of the close of business on the last business day prior to the day on which the Effective Time occurs will receive one contingent value right for each outstanding share of Common Stock held as of such date. Pursuant to the Legacy CVR Agreement, each Company Legacy CVR holder will be entitled to receive their pro rata share of an aggregate cash payment equal to 90% of the net proceeds, if any, received by the Company as a result of payments made to the Company of any upfront, milestone, royalty and other payments received under any disposition agreement related to certain of the Company's pre-Transaction assets (the "Legacy Assets").
The foregoing summary of the Legacy CVR Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the form of the Legacy CVR Agreement, which is filed herewith as Exhibit 10.1 and is incorporated by reference herein.
Redx Contingent Value Rights Agreement
Immediately prior to the Effective Time, Redx and a rights agent are expected to enter into a contingent value rights agreement (the "Redx CVR Agreement"), pursuant to which holders of record of Redx ordinary shares as of the close of business on the last business day prior to the day on which the Effective Time occurs will receive one contingent value right for each outstanding Redx ordinary share held as of such date. Pursuant to the Redx CVR Agreement, each Redx Legacy CVR holder will be entitled to receive, in the form of shares of common stock of the Company, their pro rata share of an aggregate cash payment equal to 100% of the net proceeds, if any, received by the Company as a result of payments made to the Company of any upfront, milestone, royalty and other payments received under any disposition agreement related to certain of Redx's pre-Transaction assets.
The foregoing summary of the Redx CVR Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the form of the Redx CVR Agreement, which is filed herewith as Exhibit 10.2 and is incorporated by reference herein.
Concurrent Financing
Concurrently with entering into the Transaction Agreement, we entered into a Securities Purchase Agreement (the "Securities Purchase Agreement") with certain accredited investors (the "Investors"). Pursuant to the Securities Purchase Agreement, and subject to the terms and conditions therein, the Company agreed to sell, and the Investors agreed to purchase, immediately after to the Effective Time, shares of Common Stock for an aggregate purchase price of $67.9 million, which may increase to up to
$72.9 million, subject to certain conditions (the "Concurrent Financing"). The closing of the Concurrent Financing is anticipated to occur immediately after the Closing on the Closing Date, subject to the satisfaction of customary closing conditions.
Additionally, Redx entered into subscription agreements with new and existing Redx investors, including Redx's existing major shareholder, Redmile, for a Series A private placement of $36.0 million in gross proceeds (the "Series A Financing" and, together with the Concurrent Financing, the "Financing"). The Series A Financing has been approved by the Redx board of directors and, subject to Redx shareholder approval, is expected to close shortly after the execution of the Transaction Agreement. The Financing is expected to provide the combined company with an aggregate total gross proceeds of approximately $103.9 million, which may increase to up to $108.9 million, subject to certain conditions set forth in the Side Letter (the "Concurrent Financing"). See Note 11 Subsequent Events for additional information.
Equity Line of Credit and Warrant
Concurrently with entering into the Transaction Agreement, the Company entered in a binding term sheet (the "Term Sheet") with a fund affiliated with Redmile Group, LLC ("Redmile"), pursuant to which, and subject to the terms and conditions therein, the Company and Redmile agreed to enter into definitive documentation with respect to an equity line of credit (the "ELOC") and the Warrant (as defined below) within seven days of the date of the Term Sheet. Pursuant to the Term Sheet, the ELOC will be effective for a period of three years following the closing of the Concurrent Financing and obligate the Company to sell shares of Common Stock and/or Non-Voting Common Stock having an aggregate purchase price of up to $22.0 million to Redmile from time to time, subject to cetain volume limitations, at a purchase price set in accordance with the terms therein. In addition, pursuant to the Term Sheet, the Company agreed to issue to Redmile at the Closing Time, a warrant to purchase up to $5.0 million of shares of Common Stock and/or Non-Voting Common Stock in accordance with the terms set forth therein (the "Warrant").
Termination of Halozyme License Agreement
In December 2025, the Company entered into a Non-exclusive Global Collaboration and License Agreement (the "Halozyme License Agreement") with Halozyme, Inc. ("Halozyme").
Under the terms of the Halozyme License Agreement, Halozyme granted the Company a non-exclusive license to Halozyme's ENHANZE® drug delivery technology for the development of a subcutaneous co-formulation with nimacimab (such combination, the "Product"). Halozyme will also be the Company's exclusive supplier of clinical and commercial supplies of the active pharmaceutical ingredient ("API") for Halozyme's rHuPH20 bulk drug product.
On August 11, 2026, the Company notified Halozyme of its intent to terminate the Halozyme License Agreement.
Financial Overview
Revenues
To date, we have not commercialized any products and have never generated revenue from the commercialization of any product. If we are unable to complete the proposed transaction with Redx, we may need to raise additional capital. There can be no assurances, however, that additional funding will be available on terms acceptable to us, or at all.
Research and Development Expenses
During the three and six months ended June 30, 2026, we incurred $3,941,932 and $11,877,612 in research and development expenses, respectively, primarily related to our Phase 2a clinical trial of nimacimab for obesity and the manufacturing costs associated with future trials. During the three and six months ended June 30, 2025, we incurred $14,337,753 and $21,535,010 in research and development expense, respectively, primarily related to our efforts in conducting our Phase 2a clinical trial related to our Phase 2a clinical trial for nimacimab for obesity.
As a result of terminating the CBeyond trial and any other research and development expenses associated with nimacimab, including workforce reduction, vendor contracts and license agreements, we expect research and development expenses in the future will be significantly reduced until the completion of the proposed transaction with Redx.
General and Administrative Expenses
Our general and administrative expenses have fluctuated year-over-year as we have entered into various strategic acquisitions to restructure and reposition our company. Additionally, as a business in the early stages of drug development we are continually evaluating our operations and infrastructure to identify areas where we can increase efficiencies. As a public company, we expect to incur additional expenses related to insurance, investor relations activities, legal and other administration and
professional services to comply with the rules and regulations of the SEC, the Financial Industry Regulatory Authority ("FINRA") and Nasdaq. Other significant costs are expected to include legal fees relating to patent and corporate matters, business development costs and fees for consulting services. To incentivize our employees and be competitive to retain strong talent we issued additional equity awards in 2026 and 2025 and we repriced certain options in the first quarter of 2026, which have resulted in increased stock-based compensation expense. We expect general and administrative expenses to reduce in the future resulting from workforce reduction activities and will continue to reduce until the proposed transaction with Redx is complete.
Estimate for Legal Contingencies and Related Expenses
The estimate for legal contingencies and related expenses relates to a litigation matter that related to a former employee of the Company. As of December 31, 2023, we had posted an appellate bond that was collateralized by an irrevocable letter of credit equal to, $9,080,202, approximately 150% of the liability recorded on our balance sheet. As of December 31, 2024, we were successful in our appeal of the judgment in the Ninth Circuit Court of Appeals and the case was remanded back to the District Court for a new trial, as a result of which we recovered the appellate bond and reduced the estimated legal contingency based on new key assumptions. As of June 30, 2026, the estimated legal contingency, including accrued legal expenses, is $5,417,250, an increase of $3,348,183 from December 31, 2025. The increase primarily reflects a $3,250,000 change in the estimated legal contingency recognized during the second quarter of 2026, as well as changes in accrued legal expenses. The final amount of the loss and loss recoveries remains uncertain. We believe that it is at least reasonably possible that the estimated amount of the potential loss may change in the near term.
Other (Income) Expense
Other expense primarily includes a gain from the sale of the Avalite Sciences, Inc. ("AVI") building (the "AVI building") in the first quarter of 2024 and interest income earned on our cash and cash equivalent balances and short term investments.
Critical Accounting Estimates
There have been no material changes in our Critical Accounting Estimates from the information provided in the "Critical Accounting Estimates" section of "Item 7- Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
Recently Issued and Adopted Accounting Pronouncements
See Note 1 to the accompanying unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for information on recently issued accounting pronouncements and recently adopted accounting pronouncements. While we expect certain recently adopted accounting pronouncements to impact our disclosures in future periods, the impact upon adoption was not significant to our current estimates and operations.
Results of Operations
For the three months ended June 30, 2026 and 2025
Research and Development Expenses
Below is a summary of our research and development expenses during the three months ended June 30, 2026 and for the same period in 2025:
Three Months Ended June 30,
2026 2025 $ Change
2026 vs. 2025 		% Change
2026 vs. 2025
Research and development expenses $ 3,941,932 $ 14,337,753 $ (10,395,821) (73) %
Research and development expenses for the three months ended June 30, 2026, decreased by $10,395,821 as compared to the same period in 2025. The net decrease in research and development expenses was primarily due to:
•Clinical trial costs decreased by $2,025,003 due to the termination of all clinical activities related to CBeyond, including enrollment for the CBeyond expansion (Part C) study, and the pausing of all R&D activities associated with nimacimab in order to evaluate strategic options.
•Contract manufacturing costs decreased by $7,885,849 due to the termination of all clinical activities related to CBeyond, including enrollment for the CBeyond expansion (Part C) study, and the pausing of all R&D activities associated with nimacimab in order to evaluate strategic options.
•Discovery research and development costs decreased $555,674 primarily due to the pausing of all R&D activities and cost-cutting measures implemented as the Company evaluates strategic options.
•Quality assurance costs decreased by $21,480 primarily due to the pausing of all R&D activities and cost-cutting measures implemented as the Company evaluates strategic options.
•Salaries and stock-based compensation increased by $236,291 primarily due to severance for one employee and incremental expenses form the stock option repricing.
•Consulting, advisory and professional fees decreased by $59,191 primarily due to the pausing of all R&D activities associated with nimacimab and cost-cutting measures implemented as the Company evaluates strategic options.
General and Administrative Expenses
Below is a summary of our general and administrative expenses during the three months ended June 30, 2026, and for the same period in 2025:
Three Months Ended June 30,
2026 2025 $ Change
2026 vs. 2025 		% Change
2026 vs. 2025
General and administrative expenses $ 3,869,371 $ 3,906,172 $ (36,801) (1) %
General and administrative expenses for the three months ended June 30, 2026, decreased by $36,801 as compared to the same period in 2025. The decrease in general and administrative expenses was primarily due to:
•Salaries, benefits and other direct employee related costs decreased by $1,416,005 primarily due to lower headcount.
•Consulting, advisory and professional fees increased by $158,060 primarily due to the timing of tax accounting services and financial advisory services.
•Investor relations, marketing and communications expenses decreased by $212,353 primarily due to reductions in content creation and digital marketing expenses.
•Recruiting fees decreased by $50,000 primarily due to the one time cost to hire an executive in the prior period.
•Legal fees increased by $1,549,769 due to costs associated with the strategic alternatives process and negotiation of the proposed Transaction Agreement and litigation defense costs.
•General business expenses decreased $66,272 primarily due to headcount reductions and associated travel and entertainment expenses, as compared to the same period in the prior year.
Change in Estimate for Legal Contingencies
Total change in estimate for legal contingencies for the three months ended June 30, 2026, and for the same period in 2025:
Three Months Ended June 30,
2026 2025 $ Change
2026 vs. 2025 		% Change
2026 vs. 2025
Change in estimate for legal contingencies $ 3,250,000 $ - $ 3,250,000 100 %
For the three months ended June 30, 2026, we recorded a change in estimate for legal contingencies (as defined in Note 9 to the accompanying Unaudited Condensed Consolidated Financial Statements) based on changes after June 30, 2026, to the facts and circumstances related to our legal proceedings that existed as of the balance sheet date.
Other (Income) Expense
Below is a summary of our other (income) expense for the three months ended June 30, 2026 and for the same period in 2025:
Three Months Ended June 30,
2026 2025 $ Change
2026 vs. 2025 		% Change
2026 vs. 2025
Interest expense $ 3,299 $ - $ 3,299 100 %
Interest and other income, net (103,208) (533,090) 429,882 (81) %
Gains from asset sales (178,200) (89,363) (88,837) 99 %
Total other income $ (278,109) $ (622,453) $ 344,344 (55) %
For the three months ended June 30, 2026, other income decreased $344,344 as compared to the same period in 2025 primarily due to:
•Decreases in interest income and other income, net of $429,882 due to decreased interest from our cash equivalents and short-term investments yields as a result of the decrease in cash equivalents and short-term investments on hand.
For the six months ended June 30, 2026 and 2025
Research and Development Expenses
Below is a summary of our research and development expenses during the six months ended June 30, 2026 and for the same period in 2025:
Six Months Ended June 30,
2026 2025
$ Change
2026 vs. 2025
% Change
2026 vs. 2025
Research and development expenses $ 11,877,612 $ 21,535,010 $ (9,657,398) (45) %
Research and development expenses for the six months ended June 30, 2026, decreased by $9,657,398 as compared to the same period in 2025. The net decrease in research and development expenses was primarily due to:
◦Clinical trial costs decreased by $1,837,419 due to the termination of all clinical activities related to CBeyond, including enrollment for the CBeyond expansion (Part C) study, and the pausing of all R&D activities associated with nimacimab in order to evaluate strategic options.
◦Contract manufacturing costs decreased by $7,681,937 due to the termination of all clinical activities related to CBeyond, including enrollment for the CBeyond expansion (Part C) study, and the pausing of all R&D activities associated with nimacimab in order to evaluate strategic options.
◦Discovery research and development costs decreased by $724,061 primarily due to the pausing of all R&D activities and cost-cutting measures implemented as the Company evaluates strategic options.
◦Quality assurance costs decreased by $86,376 primarily due to the pausing of all R&D activities and cost-cutting measures implemented as the Company evaluates strategic options.
◦Salaries and stock-based compensation increased by $611,340 primarily due to severance for seven employees and incremental expenses form the stock option repricing.
◦Consulting, advisory and professional fees increased by $157,223 primarily due to the build out of the Company's SOP system, before pausing of all R&D activities associated with nimacimab.
General and Administrative Expenses
Below is a summary of our general and administrative expenses during the six months ended June 30, 2026, and for the same period in 2025:
Six Months Ended June 30,
2026 2025 $ Change
2026 vs. 2025 		% Change
2026 vs. 2025
General and administrative expenses $ 8,608,057 $ 8,468,477 $ 139,580 2 %
General and administrative expenses for the six months ended June 30, 2026, increased by $139,580 as compared to the same period in 2025. The increase in general and administrative expenses was primarily due to:
◦Salaries, benefits and other direct employee related costs decreased by $1,691,664 primarily due to lower headcount.
◦Consulting, advisory and professional fees increased by $129,815 primarily due to the timing of tax accounting services and financial advisory services.
◦Investor relations, marketing and communications expenses decreased by $547,385 primarily due to reductions in content creation and digital marketing expenses.
◦Recruiting fees decreased by $83,750 primarily due to the one time cost to hire an executive in the prior period.
◦Legal fees increased by $2,538,393 due to costs associated with the strategic alternatives process and negotiation of the proposed Transaction Agreement and litigation defense costs.
◦General business expenses decreased $205,829 primarily due to headcount reductions and associated travel and entertainment expenses, as compared to the same period in the prior year.
Change in Estimate for Legal Contingencies
Total change in estimate for legal contingencies for the six months ended June 30, 2026, and for the same period in 2025:
Six Months Ended June 30,
2026 2025 $ Change
2026 vs. 2025 		% Change
2026 vs. 2025
Change in estimate for legal contingencies $ 3,250,000 $ - $ 3,250,000 100 %
For the six months ended June 30, 2026, we recorded a change in estimate for legal contingencies (as defined in Note 9 to the accompanying Unaudited Condensed Consolidated Financial Statements) based on changes after June 30, 2026, to the facts and circumstances related to our legal proceedings that existed as of the balance sheet date.
Other (Income) Expense
Below is a summary of our other (income) expense for the six months ended June 30, 2026 and for the same period in 2025:
Six Months Ended June 30,
2026 2025
$ Change
2026 vs. 2025
% Change
2026 vs. 2025
Interest expense $ 5,498 $ - 5,498 100 %
Interest and other income, net (272,823) (1,191,333) 918,510 (77) %
Gains from asset sales (178,200) (89,363) (88,837) 99 %
Other expense 2,411 - 2,411 100 %
Total other income $ (443,114) $ (1,280,696) $ 837,582 (65) %
For the six months ended June 30, 2026, other income decreased $837,582 as compared to the same period in 2025 primarily due to:
◦Decreases in interest income and other income, net of $918,510 due to decreased interest from our cash equivalents and short-term investments yields as a result of the decrease in cash equivalents and short-term investments on hand.
Liquidity, Going Concern and Capital Resources
Liquidity
We have incurred operating losses and negative cash flows from operations since our inception. We expect to continue to incur significant losses and negative cash flows from operations through 2026 and into the foreseeable future. Historically, we have funded our operations primarily through issuance of equity securities, borrowings from a related party and strategic transactions. We have not commercialized any products and have never generated revenue from the commercialization of any
product. If we are unable to complete the proposed transaction with Redx, we may need to raise additional capital. There can be no assurances, however, that additional funding will be available on terms acceptable to us, or at all.
As of June 30, 2026, we had working capital deficit of $572,215, an accumulated deficit of $210,170,441, and stockholders' deficit of $497,307. We had unrestricted cash and cash equivalents and short-term investments in the amount of $10,064,141 as of June 30, 2026, as compared to $25,737,221 as of December 31, 2025. For the three months ended June 30, 2026 and 2025, the Company incurred losses from operations of $11,061,303 and $18,243,925, respectively. For the six months ended June 30, 2026 and 2025, the Company incurred losses from operations of $23,735,669 and $30,003,487, respectively. For the three months ended June 30, 2026 and 2025, the Company incurred net losses of $10,786,594 and $17,624,872, respectively. For the six months ended June 30, 2026 and 2025, the Company incurred net losses of $23,295,955 and $28,728,191, respectively.
Going Concern
Our independent registered public accounting firm issued a report on our audited consolidated financial statements as of and for the year ended December 31, 2025, that included an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern due to our recurring operating losses. Our condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities in the normal course of business. Our accompanying condensed consolidated financial statements do not include any adjustments to the carrying amounts or classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Refer to "Risks Related to Our Limited Operating History, Financial Position and Capital Requirements - Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern, and if we are unable to continue, you may lose your entire investment" in our Annual Report on Form 10-K for additional information.
As of June 30, 2026, we have substantially reduced operations including termination of the CBeyond trial, significant reduction of all R&D costs associated with the development of nimacimab and other potential pipeline assets, reduction in workforce, and termination of vendor contracts and licensing agreements.
Our future capital requirements will depend on many factors, including:
•Our ability to complete the proposed Transaction Agreement with Redx;
•the costs associated with being a public company;
•the amount of revenue, if any, received from the monetization of the Company Legacy CVR, commercial sales of our drug candidates, should any of our drug candidates receive marketing approval;
•the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing possible patent claims, including litigation costs and the outcome of any such litigation;
•the results of the new trial in the litigation matter discussed above under "- General Litigation and Disputes - Wendy Cunning vs. Skye Bioscience, Inc." and "- Financial Overview - Estimated Legal Contingency"; and
•the impact of any of the foregoing of macroeconomic events, including inflation, fluctuating interest and exchange rates, and market volatility as a result of trade, fiscal and regulatory policies, including tariffs and any effects of a prolonged government shutdown.
Cash Flows
The following is a summary of our cash flows for the periods indicated and has been derived from our unaudited condensed consolidated financial statements which are included elsewhere in this Quarterly Report on Form 10-Q:
Six Months Ended June 30,
2026 2025
Net cash used in operating activities $ (15,679,591) $ (19,931,667)
Net cash provided by (used in) investing activities 18,037,989 (24,663,988)
Net cash (used in) provided by in financing activities (172,539) 18,158
Cash Flows from Operating Activities
The primary use of cash for our operating activities during the period was to fund research development activities for our clinical product candidate and general and administrative activities. Our cash used in operating activities also reflected changes in our working capital, net of adjustments for non-cash charges, such as stock-based compensation, depreciation and amortization.
Cash used in operating activities of $15,679,591 during the six months ended June 30, 2026, reflected a net loss of $23,295,955, partially offset by aggregate non-cash charges of $6,767,758 and included a $848,606 net cash inflow in our operating assets and liabilities.
Non-cash charges included a $3,250,000 change in estimate for legal contingencies, $2,768,199 for stock-based compensation expense primarily attributable to the recognition of current period expense on prior grants, $597,275 loss on disposal of assets, and $330,484 in depreciation and amortization. The net change in our operating assets and liabilities included a $784,043 cash inflow from the decrease in our prepaid expenses and other current assets, a $2,396,394 net cash outflow from decrease in our accrued expenses and other current liabilities and a $2,244,988 cash inflow from the increase of our accounts payable.
Cash used in operating activities of 19,931,667 during the six months ended June 30, 2025, reflected a net loss $28,728,191, partially offset by aggregate non-cash charges of $4,510,100 and included a $4,286,424 net cash outflow in our operating assets and liabilities.
Cash Flows from Investing Activities
During the six months ended June 30, 2026, our cash provided by investing activities related primarily to the maturity, of $17,858,939 in short-term investments.
During the six months ended June 30, 2025, our cash used in investing activities related primarily to the purchase of $24,747,039 in short-term investments and $89,363 in net proceeds from the sale of the AVI building.
Cash Flows from Financing Activities
During the six months ended June 30, 2026, cash used in financing activities included $178,813 in repayments on the our insurance premium loan payable.
During the six months ended June 30, 2025, cash provided by financing activities included $18,158 in proceeds from the purchase under employee stock purchase plan.
Off-Balance Sheet Arrangements
There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
Skye Bioscience Inc. published this content on August 14, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on August 14, 2026 at 13:40 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]