If you purchase securities in this offering, you will suffer immediate dilution of your investment.
The public offering price of our common stock and pre-funded warrants is substantially higher than the net tangible book value per
share of our common stock. Therefore, if you purchase shares of our common stock or pre-funded warrants in this offering, you will pay a price per share or pre-funded warrant that substantially exceeds our net tangible book value per share after
this offering. Based on a public offering price of $ per share, you will experience immediate dilution of
$ per share, representing the difference between our as adjusted net tangible book value per share as of June 30, 2022 after giving effect to this offering and the public
offering price. Furthermore, if the underwriters exercise their option to purchase additional shares in this offering, or if holders of our previously issued options to acquire common stock at prices below the public offering price exercise any such
options, you will experience further dilution. For additional information on the dilution that you will experience immediately after this offering, see Dilution.
There is no public market for the pre-funded warrants being offered in this offering.
There is no public trading market for the pre-funded warrants being offered in this offering, and we do
not expect a market to develop. In addition, we do not intend to list the pre-funded warrants on The Nasdaq Global Market or any other national securities exchange or nationally recognized trading system.
Without an active trading market, the liquidity of the pre-funded warrants will be limited.
Except for the
right to participate in certain dividends, distributions and rights offerings, holders of the pre-funded warrants will have no rights as common stockholders until such holders exercise their pre-funded warrants and acquire our common stock.
Except by virtue of such holders
ownership of shares of our common stock, and except for the right to participate in certain dividends, distributions and rights offerings, the holder of a pre-funded warrant will not have the rights or privileges of a holder of our common stock,
including any voting rights, until such holder exercises the pre-funded warrant. Upon exercise of the pre-funded warrants, the holders will be entitled to exercise the rights of a common stockholder only as to
matters for which the record date occurs after the exercise date.
If you purchase securities in this offering, you may also experience future
dilution as a result of future equity offerings.
We expect our expenses to increase substantially in connection with our planned
operations, particularly as we complete the open-label extension portion of our ongoing Phase 2b/3 PRISM trial and conduct our planned clinical trials of Haduvio for the treatment of chronic cough in adults with IPF and for the treatment of
refractory chronic cough. To the extent that we raise additional capital in the future through the sales of common stock, convertible securities or other equity securities, your ownership interest may be diluted.
We are currently party to the ATM Sales Agreement with SVB Securities LLC, pursuant to which we may sell shares of common stock for remaining
gross proceeds of up to $52.0 million from time to time through an at-the-market equity offering program. We are also currently party to a common stock
purchase agreement, or the LPC Purchase Agreement, with Lincoln Park Capital Fund, LLC, or Lincoln Park, pursuant to which we have the right, but not the obligation, to sell, at our discretion, to Lincoln Park up to $15.0 million of shares of
our common stock from time to time. To the extent that we sell shares of our common stock under the ATM Sales Agreement, the LPC Purchase Agreement or otherwise at prices that are below the price you pay for shares of common stock or pre-funded
warrants in this offering, you will experience further dilution.
Furthermore, we have a significant number of outstanding options,
warrants and pre-funded warrants to purchase shares of our common stock, many of which are exercisable at prices lower than the closing sale price on the Nasdaq Global Market of $2.20 on September 21,
2022. If these securities are exercised at prices that are below the price you pay for shares of common stock or pre-funded warrants in this offering, you will incur further dilution. Moreover, to the extent that we issue additional options to
purchase, or securities convertible into or exchangeable for, shares of our common stock in the future and those options or other securities are exercised, converted or exchanged, you would experience further dilution.
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