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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________ to ________________

Commission File Number: 001-40672

RANI THERAPEUTICS HOLDINGS, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware	86-3114789
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2051 Ringwood Avenue San Jose, California	95131
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (408) 457-3700

Securities registered pursuant to Section 12(b) of the Act:

      Title of each class

      Trading
Symbol(s)

      Name of each exchange on which registered

      Class A common stock, par value $0.0001 per share

      RANI

      The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 4, 2025, the registrant had 47,898,228 shares of Class A common stock, $0.0001 par value per share, outstanding, 23,970,359 shares of Class B common stock, $0.0001 par value per share, outstanding and no shares of Class C common stock, $0.0001 par value per share, outstanding. Certain holders of units of the registrant’s consolidated subsidiary, Rani Therapeutics, LLC, who do not hold shares of the registrant’s Class B common stock can exchange their units of Rani Therapeutics, LLC for 1,124,194 shares of the registrant’s Class A common stock.

Table of Contents


		Page
Special Note Regarding Forward-Looking Statements		3

PART I.	FINANCIAL INFORMATION

	RANI THERAPEUTICS HOLDINGS, INC.
Item 1.	Financial Statements (Unaudited)	5
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Operations	6
	Condensed Consolidated Statements of Comprehensive Loss	7
	Condensed Consolidated Statements of Changes in Stockholders’ (Deficit)/Equity	8
	Condensed Consolidated Statements of Cash Flows	10
	Notes to Unaudited Condensed Consolidated Financial Statements	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	33

PART II.	OTHER INFORMATION	34

Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosures	38
Item 5.	Other Information	38
Item 6.	Exhibits	39
Signatures		40

Unless otherwise stated or the context otherwise requires, the terms “we,” “us,” and “our,” and similar references refer to Rani Therapeutics Holdings, Inc. (“Rani Holdings”) and its consolidated subsidiary, Rani Therapeutics, LLC (“Rani LLC”).

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including the section titled "Management's Discussion and Analysis of Financial Condition and Results of Operations," contains forward-looking statements. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations and consolidated financial position, business strategy, product candidates, planned preclinical studies and clinical trials, results of clinical trials, research and development costs, manufacturing costs, regulatory approvals, development and advancement of our oral delivery technology, timing and likelihood of success, potential partnering activities as well as plans and objectives of management for future operations, are forward-looking statements. These statements involve known and unknown risks, uncertainties, and other important factors that are in some cases beyond our control and may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “would,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “believe,” “estimate,” “predict,” “potential,” “seek,” “aim,” or “continue” or the negative of these terms or other similar expressions. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

•

our ability to raise additional capital to fund our existing operations and continue as a going concern;

•

our plans to improve our liquidity and financial position in response to the substantial doubt about our ability to continue as a going concern;

•

our ability to maintain the listing of our Class A common stock on the Nasdaq Global Market;

•

the progress and focus of our current and future clinical trials in the United States and abroad, and the reporting of data from those trials;

•

our ability to advance product candidates into and successfully complete clinical trials;

•

the beneficial characteristics, safety, efficacy, and therapeutic effects of our product candidates;

•

our potential and ability to successfully manufacture and supply our product candidates for clinical trials and for commercial use, if approved;

•

our ability to complete development of the RaniPill HC or any redesign and conduct additional preclinical and clinical studies of the RaniPill HC or any future design of the RaniPill capsule to accommodate target payloads that are larger than the payload capacity of the RaniPill GO capsule used to date for clinical studies of our product candidates;

•

our ability to further develop and expand our platform technology;

•

our ability to utilize our technology platform to generate and advance additional product candidates;

•

the accuracy of our estimates regarding expenses, future revenue, capital requirements, and needs for additional financing;

•

our financial performance;

•

our plans relating to commercializing our product candidates, if approved;

•

our ability to selectively enter into strategic partnership and the expected potential benefits thereof;

•

the implementation of our strategic plans for our business and product candidates;

•

our ability to continue to scale and optimize our manufacturing processes, including by expanding our use of automation;

•

our estimates of the number of patients in the United States who suffer from the indications we target and the number of patients that will enroll in our clinical trials;

•

the size of the market opportunity for our product candidates in each of the indications we target;

•

our ability to continue to innovate and expand our intellectual property by developing new applications of the RaniPill capsule;

•

our plans and ability to obtain or protect intellectual property rights, including extensions of existing patent terms where available;

•

the scope of protection we are able to establish and maintain for intellectual property rights, including our technology platform and product candidates;

•

the sufficiency of our existing cash and cash equivalents to fund our future operating expenses and capital expenditure requirements;

•

our ability to realize savings from any restructuring plans or cost-containment measures we propose to implement;

•

developments relating to our competitors and our industry, including competing product candidates and therapies;

•

our realization of any benefit from our organizational structure, taking into account our obligations under the Tax Receivable Agreement (defined herein) and the impact of any payments required to be made thereunder on our liquidity and financial condition; and

•

our expectations regarding the period during which we will qualify as an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).

These forward-looking statements are subject to a number of risks, uncertainties, and assumptions described in the section titled “Risk Factors” and elsewhere in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 31, 2025. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, or otherwise.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and you are cautioned not to unduly rely upon these statements.

RANI THERAPEUTICS HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except par value)


	June 30,			December 31,
	2025			2024
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	10,216		$	3,762
Contract asset		—			428
Marketable securities		—			23,877
Prepaid expenses and other current assets		857			1,677
Total current assets		11,073			29,744
Property and equipment, net		1,144			1,548
Operating lease right-of-use asset		4,388			5,096
Other assets		293			246
Total assets	$	16,898		$	36,634
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	1,798		$	1,359
Accrued expenses and other current liabilities		2,636			2,073
Current portion of long-term debt		15,000			15,000
Current portion of operating lease liability		1,189			1,459
Total current liabilities		20,623			19,891
Long-term debt, less current portion		2,229			9,613
Operating lease liability, less current portion		3,199			3,637
Total liabilities		26,051			33,141
Commitments and contingencies (Note 12)
Stockholders' equity:
Preferred stock, $0.0001 par value - 20,000 shares authorized; none issued and outstanding as of June 30, 2025 and December 31, 2024		—			—
Class A common stock, $0.0001 par value - 800,000 shares authorized; 39,237 and 33,430 issued and outstanding as of June 30, 2025 and December 31, 2024, respectively		3			3
Class B common stock, $0.0001 par value - 40,000 shares authorized; 23,970 and 23,972 issued and outstanding as of June 30, 2025 and December 31, 2024, respectively		2			2
Class C common stock, $0.0001 par value - 20,000 shares authorized; none issued and outstanding as of June 30, 2025 and December 31, 2024		—			—
Additional paid-in capital		111,280			104,889
Accumulated other comprehensive gain		3			5
Accumulated deficit		(116,863	)		(102,907	)
Total stockholders' (deficit)/equity attributable to Rani Therapeutics Holdings, Inc.		(5,575	)		1,992
Non-controlling interest		(3,578	)		1,501
Total stockholders' (deficit)/equity		(9,153	)		3,493
Total liabilities and stockholders' equity	$	16,898		$	36,634

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

RANI THERAPEUTICS HOLDINGS, INC.

CONDENSED Consolidated Statements of Operations

(in thousands, except per share amounts)

(Unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Contract revenue	$	—		$	—		$	172		$	—
Operating expenses
Research and development		5,505			6,115			12,075			13,700
General and administrative		5,000			6,409			10,615			12,857
Total operating expenses	$	10,505		$	12,524		$	22,690		$	26,557
Loss from operations		(10,505	)		(12,524	)		(22,518	)		(26,557	)
Other income (expense), net
Interest income and other, net		158			439			375			988
Interest expense and other, net		(877	)		(1,276	)		(1,819	)		(2,571	)
Net loss	$	(11,224	)	$	(13,361	)	$	(23,962	)	$	(28,140	)
Net loss attributable to non-controlling interest		(4,532	)		(6,556	)		(10,006	)		(13,852	)
Net loss attributable to Rani Therapeutics Holdings, Inc.	$	(6,692	)	$	(6,805	)	$	(13,956	)	$	(14,288	)
Net loss per Class A common share attributable to Rani Therapeutics Holdings, Inc., basic and diluted	$	(0.18	)	$	(0.26	)	$	(0.40	)	$	(0.55	)
Weighted-average Class A common shares outstanding—basic and diluted		36,542			26,324			34,999			26,179

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

RANI THERAPEUTICS HOLDINGS, INC.

CONDENSED Consolidated Statements of Comprehensive Loss

(in thousands)

(Unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Net loss	$	(11,224	)	$	(13,361	)	$	(23,962	)	$	(28,140	)
Other comprehensive loss
Net unrealized (loss) gain on marketable securities		1			12			(5	)		13
Comprehensive loss	$	(11,223	)	$	(13,349	)	$	(23,967	)	$	(28,127	)
Comprehensive loss attributable to non-controlling interest		(4,244	)		(6,550	)		(12,311	)		(13,845	)
Comprehensive loss attributable to Rani Therapeutics Holdings, Inc.	$	(6,979	)	$	(6,799	)	$	(11,656	)	$	(14,282	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

RANI THERAPEUTICS HOLDINGS, INC.

CONDENSED Consolidated Statements of Changes in STOCKHOLDERS’ (DEFICIT)/Equity

(in thousands)

(Unaudited)


	Class A Common Stock				Class B Common Stock
	Shares		Amount		Shares			Amount		Additional Paid In Capital			Accumulated Other Comprehensive Gain			Accumulated Deficit			Non-Controlling Interest			Total Stockholders' (Deficit)/Equity
Balance at December 31, 2024		33,430	$	3		23,972		$	2	$	104,889		$	5		$	(102,907	)	$	1,501		$	3,493
Issuance of common stock under employee equity plans, net of shares withheld for tax settlement		140		—		—			—		(23	)		—			—			—			(23	)
Non-controlling interest adjustment for changes in proportionate ownership in Rani LLC		—		—		—			—		1			—			—			(1	)		—
Stock-based compensation		—		—		—			—		2,241			—			—			1,684			3,925
Net loss		—		—		—			—		—			—			(7,264	)		(5,474	)		(12,738	)
Other comprehensive loss		—		—		—			—		—			(3	)		—			(3	)		(6	)
Balance at March 31, 2025		33,570	$	3		23,972		$	2	$	107,108		$	2		$	(110,171	)	$	(2,293	)	$	(5,349	)
Exercise of warrants issued in connection with the October 2024 and July 2024 Securities Purchase Agreement, net of issuance costs of $340		5,419		—		—			—		3,937			—			—			—			3,937
Warrant issued for services provided		—		—		—			—		152			—			—			—			152
Issuance of common stock under employee equity plans, net of shares withheld for tax settlement		44		—		—			—		(8	)		—			—			—			(8	)
Issuance of common stock under employee stock purchase plan		97		—		—			—		46			—			—			—			46
Effect of exchanges of Paired Interests and non-corresponding Class A Units of Rani LLC		107		—		(2	)		—		—			—			—			—			—
Non-controlling interest adjustment for changes in proportionate ownership in Rani LLC		—		—		—			—		(1,963	)		—			—			1,963			—
Stock-based compensation		—		—		—			—		2,008			—			—			1,284			3,292
Net loss		—		—		—			—		—			—			(6,692	)		(4,532	)		(11,224	)
Other comprehensive loss		—		—		—			—		—			1			—			—			1
Balance at June 30, 2025		39,237	$	3		23,970		$	2	$	111,280		$	3		$	(116,863	)	$	(3,578	)	$	(9,153	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

RANI THERAPEUTICS HOLDINGS, INC.

CONDENSED Consolidated Statements of Changes in STOCKHOLDERS’ (DEFICIT)/Equity

(in thousands)

(Unaudited)


	Class A Common Stock				Class B Common Stock
	Shares		Amount		Shares		Amount		Additional Paid In Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Non-Controlling Interest			Total Stockholders' Equity
Balance at December 31, 2023		26,036	$	3		24,116	$	2	$	85,762		$	(12	)	$	(72,889	)	$	12,577		$	25,443
Issuance of common stock under employee equity plans		175		—		—		—		—			—			—			—			—
Effect of exchanges of non-corresponding Class A Units of Rani LLC		83		—		—		—		—			—			—			—			—
Non-controlling interest adjustment for changes in proportionate ownership in Rani LLC		—		—		—		—		45			—			—			(45	)		—
Stock-based compensation		—		—		—		—		1,969			—			—			1,901			3,870
Net loss		—		—		—		—		—			—			(7,483	)		(7,296	)		(14,779	)
Other comprehensive gain		—		—		—		—		—			1			—			—			1
Balance at March 31, 2024		26,294	$	3		24,116	$	2	$	87,776		$	(11	)	$	(80,372	)	$	7,137		$	14,535
Issuance of common stock under employee equity plans		110		—		—		—		221			—			—			—			221
Issuance of common stock under employee equity plans, net of shares withheld for tax settlement		85		—		—		—		14			—			—			—			14
Non-controlling interest adjustment for changes in proportionate ownership in Rani LLC		—		—		—		—		(108	)		—			—			108			—
Stock-based compensation		—		—		—		—		2,109			—			—			2,020			4,129
Net loss		—		—		—		—		—			—			(6,805	)		(6,556	)		(13,361	)
Other comprehensive gain		—		—		—		—		—			6			—			6			12
Balance at June 30, 2024		26,489	$	3		24,116	$	2	$	90,012		$	(5	)	$	(87,177	)	$	2,715		$	5,550

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

RANI THERAPEUTICS HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)


	Six Months Ended June 30,
	2025			2024
Cash flows from operating activities
Net loss	$	(23,962	)	$	(28,140	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense		7,217			7,999
Depreciation and amortization		491			503
Non-cash operating lease expense		955			477
Warrant issued for services provided		152			—
Amortization of debt discount and issuance costs		116			116
Net accretion and amortization of investments in marketable securities		(158	)		(630	)
Changes in operating assets and liabilities:
Accounts receivable		428			—
Prepaid expenses and other current assets		820			1,175
Accounts payable		439			(142	)
Accrued expenses and other current liabilities		558			688
Other long term assets		(47	)		—
Operating lease liabilities		(954	)		(477	)
Net cash used in operating activities		(13,945	)		(18,431	)
Cash flows from investing activities
Proceeds from maturities of marketable securities		26,750			38,550
Purchases of marketable securities		(2,720	)		(21,619	)
Purchases of property and equipment		(88	)		(112	)
Net cash provided by investing activities		23,942			16,819
Cash flows from financing activities
Proceeds from exercise of warrants for common stock, net of issuance costs		3,937			—
Issuance of common stock under employee stock purchase plan		46			221
Proceeds from employee stock purchase plan		5			27
Proceeds from the exercise of stock options		—			38
Tax withholdings paid on behalf of employees for net share settlement		(31	)		(24	)
Repayment of debt		(7,500	)		—
Net cash (used in)/provided by financing activities		(3,543	)		262
Net increase/(decrease) in cash, cash equivalents and restricted cash equivalents		6,454			(1,350	)
Cash, cash equivalents and restricted cash equivalents, beginning of period		4,262			6,364
Cash, cash equivalents and restricted cash equivalents, end of period	$	10,716		$	5,014
Supplemental disclosures of non-cash investing and financing activities
Interest income receivable included in prepaid expenses and other current assets	$	18		$	51
Right-of-use assets obtained in exchange for new operating lease liabilities	$	—		$	4,731
Exchanges of non-corresponding Class A Units of Rani LLC	$	63		$	298
Remeasurement of operating lease right-of-use assets	$	—		$	589

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

RANI THERAPEUTICS HOLDINGS, INC.

Notes to THE UNAUDITED CONDENSED Consolidated Financial Statements

1. Organization and Nature of Business

Description of Business

Rani Therapeutics Holdings, Inc. (“Rani Holdings”, and together with its consolidated subsidiary, the “Company”) is a clinical-stage biotherapeutics company focusing on advancing technologies to enable the administration of biologics and drugs orally, to provide patients, physicians, and healthcare systems with a convenient alternative to painful injections. The Company’s technology comprises a drug-agnostic oral delivery platform, the RaniPill capsule, which is designed to deliver a wide variety of drug substances, including antibodies, proteins, peptides, and oligonucleotides. The Company is advancing a portfolio of oral therapeutics using the RaniPill capsule. The Company is headquartered in San Jose, California and operates in one segment.

Organizational Transactions

Rani Holdings was formed as a Delaware corporation in April 2021 for the purpose of facilitating an initial public offering (“IPO”) of its Class A common stock. In connection with the IPO, the Company effected a series of organizational transactions (the “Organizational Transactions”), which, together with the IPO, were completed in August 2021, that resulted in the Company becoming the ultimate parent company of Rani Therapeutics, LLC (“Rani LLC”). The Company operates its business through Rani LLC.

As part of the Organizational Transactions, the Company entered into a Registration Rights Agreement with certain individuals and entities that continued to hold economic nonvoting Class A units of Rani LLC (“Class A Units”), collectively referred to herein as the “Continuing LLC Owners”. The Continuing LLC Owners are entitled to exchange, subject to the terms of the Fifth Amended and Restated Limited Liability Company Agreement of Rani LLC (the “Rani LLC Agreement”), the Class A Units they hold in Rani LLC, together with the shares they hold of the Company Class B common stock (together referred to as a "Paired Interest"), in return for shares of the Company’s Class A common stock on a one-for-one basis provided that, at the Company’s election, the Company has the ability to effect a direct exchange of such Class A common stock or make a cash payment equal to a volume weighted average market price of one share of Class A common stock for each Paired Interest redeemed. Any shares of Class B common stock will be canceled on a one-for-one basis if, at the election of the Continuing LLC Owners, the Company redeems or exchanges such Paired Interest pursuant to the terms of the Rani LLC Agreement. As of June 30, 2025, certain individuals who continue to own interests in Rani LLC but do not hold shares of the Company’s Class B common stock (“non-corresponding Class A Units”) have the ability to exchange their non-corresponding Class A Units of Rani LLC for 1,124,194 shares of the Company’s Class A common stock.

Liquidity and Going Concern

The Company has incurred recurring losses since its inception, including net losses of $24.0 million for the six months ended June 30, 2025. As of June 30, 2025, the Company had an accumulated deficit of $116.9 million and for the six months ended June 30, 2025, had negative cash flows from operations of $13.9 million. As of June 30, 2025, cash, cash equivalents and marketable securities totaled $10.2 million. Based on its available cash resources and current operating plan, there is substantial doubt regarding the Company’s ability to continue as a going concern for a period of one year after the date that its financial statements for the six months ended June 30, 2025 are issued. The Company’s existing capital resources will not be sufficient to enable it to initiate any pivotal clinical trials. The Company will need to raise substantial additional funds in the future in order to complete the development of the RaniPill platform, to complete the clinical development of its product candidates and seek regulatory approval thereof, to expand its manufacturing capabilities, to further develop the RaniPill HC device and to commercialize any of its product candidates.

The Company expects to continue to generate operating losses and negative operating cash flows for the foreseeable future as it continues to develop the RaniPill capsule. The Company expects to finance its future operations with its existing cash and through strategic financing opportunities that could include, but are not limited to, future offerings of its equity, such as “at the market offerings” pursuant to its Controlled Equity Sales Agreement (the "Sales Agreement") with Cantor Fitzgerald & Co. and H.C. Wainwright & Co., LLC, collaboration or licensing agreements, or the incurrence of debt. However, there is no guarantee that any of these strategic or financing opportunities will be executed or realized on favorable terms, if at all. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern.

2. Summary of Significant Accounting Policies

Basis of Presentation

These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

The Company operates and controls all of the business and affairs of Rani LLC and, through Rani LLC conducts its business. Because the Company manages and operates the business and controls the strategic decisions and day-to-day operations of Rani LLC and also has a substantial financial interest in Rani LLC, the Company consolidates the financial results of Rani LLC, and a portion of its net loss is allocated to the non-controlling interests in Rani LLC held by the Continuing LLC Owners. All intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Condensed Consolidated Financial Statements

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and pursuant to Form 10-Q of Regulation S-X of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These unaudited condensed consolidated financial statements include all adjustments necessary to fairly state the financial position and the results of the Company's operations and cash flows for interim periods in accordance with U.S. GAAP. All such adjustments are of a normal, recurring nature. Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025 or for any future period.

The consolidated balance sheet as of December 31, 2024 included herein was derived from the audited consolidated financial statements as of that date. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Therefore, these interim condensed consolidated financial statements should be read in conjunction with the 2024 consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2025.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and the disclosure of contingent assets and liabilities in the Company’s condensed consolidated financial statements and accompanying notes. The Company evaluates its estimates on an ongoing basis. The Company bases its estimates on its historical experience and also on assumptions that we believe are reasonable; however, actual results may differ materially and adversely from these estimates.

Significant Accounting Policies

A description of the Company’s significant accounting policies is included in the audited consolidated financial statements within its Annual Report on Form 10-K for the year ended December 31, 2024. Except as noted below, there have been no material changes in the Company’s significant accounting policies during the six months ended June 30, 2025.

Cash, Cash Equivalents and Restricted Cash Equivalents

The following table provides a reconciliation of cash and cash equivalents and restricted cash equivalents reported as a component of prepaid expenses and other current assets on the condensed consolidated balance sheet which, in aggregate, represents the amount reported in the condensed consolidated statements of cash flows for the six months ended June 30, 2025 and 2024:


	Six Months Ended June 30,
	2025		2024
Cash and cash equivalents	$	10,216	$	4,514
Restricted cash equivalents		500		500
Total cash, cash equivalents and restricted cash equivalents	$	10,716	$	5,014

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires enhanced annual disclosures regarding the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 and may be adopted on a prospective or retrospective basis. Early adoption is permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03 “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40)” to provide disaggregated information about certain income statement costs and expenses. ASU 2024-03 is effective for the Company’s annual periods beginning January 1, 2027, with early adoption permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

3. Cash Equivalents, Restricted Cash Equivalents and Marketable Securities

The following tables summarizes the amortized cost and fair value of the Company's cash equivalents, restricted cash equivalents and marketable securities by major investment category (in thousands):


	As of June 30, 2025
	Amortized Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value
Current assets:
Cash equivalents:
Money market funds	$	3,858	$	—	$	—	$	3,858
Total cash equivalents		3,858		—		—		3,858
Restricted cash equivalents:
Money market funds		500		—		—		500
Total cash equivalents and restricted cash equivalents		4,358		—		—		4,358
Marketable securities:
U.S. Treasuries and agencies		3,999		—		—		3,999
Total cash equivalents, restricted cash equivalents and marketable securities	$	8,357	$	—	$	—	$	8,357


	As of December 31, 2024
	Amortized Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value
Current assets:
Cash equivalents:
Money market funds	$	404	$	—	$	—	$	404
Total cash and cash equivalents		404		—		—		404
Restricted cash equivalents:
Money market funds		500		—		—		500
Total cash equivalents and restricted cash equivalents		904		—		—		904
Marketable securities:
U.S. Treasuries and agencies		24,871		5		—		24,876
Total cash equivalents, restricted cash equivalents and marketable securities	$	25,775	$	5	$	—	$	25,780

All marketable securities are classified as short-term. The Company regularly reviews its available-for-sale marketable securities in an unrealized loss position and evaluates the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions. As of June 30, 2025, the aggregate difference between the amortized cost and fair value of each security in an unrealized loss position was de minimis. Since any provision for expected credit losses for a security held is limited to the amount the fair value is less than its amortized cost, no allowance for expected credit loss was deemed necessary at June 30, 2025. As of June 30, 2025 and December 31, 2024, interest income receivable recorded as a component of prepaid expenses and other current assets on the condensed consolidated balance sheet was de minimis.

4. Fair Value Measurements

The following tables detail information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicates the level of inputs used in such measurements (in thousands):


	As of June 30, 2025
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	3,858	$	—	$	—	$	3,858
Restricted cash equivalents:
Money market funds		500		—		—		500
Marketable securities
U.S. Treasuries and agencies		3,999		—		—		3,999
Total assets	$	8,357	$	—	$	—	$	8,357


	As of December 31, 2024
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	404	$	—	$	—	$	404
Restricted cash equivalents:
Money market funds		500		—		—		500
Marketable securities
U.S. Treasuries and agencies		24,876		—		—		24,876
Total assets	$	25,780	$	—	$	—	$	25,780

Level 1 and Level 2 financial instruments are comprised of investments in money market funds and fixed-income securities. The Company estimates the fair value of its Level 2 financial instruments by taking into consideration valuations obtained from third-party pricing services. The third-party pricing services utilize industry standard valuation models, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; and other observable inputs.

There were no transfers between Level 1, Level 2 and Level 3 of the fair value hierarchy for any of the periods presented.

5. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following (in thousands):


	June 30,		December 31,
	2025		2024
Accrued interest	$	1,147	$	931
Accrued professional fees		615		107
Payroll and related costs		375		353
Accrued rent		334		329
Accrued preclinical and clinical trial costs		75		70
Other		90		283
Total accrued expenses and other current liabilities	$	2,636	$	2,073

6. Evaluation and Collaborative Arrangements

Evaluation Arrangement

In August 2024, the Company entered into a contract with Chugai Pharmaceutical Co., Ltd. ("Chugai") to conduct evaluation services of certain Chugai compounds for oral delivery using the RaniPill HC, which was concluded to be a single performance obligation with an enforceable right to payment. Chugai paid the Company an up-front payment of $0.6 million upon execution of the contract. Upon completion of the evaluation services, in April 2025, the Company was paid a final $0.6 million for an

aggregate total of $1.2 million due under the contract. For the three and six months ended June 30, 2025, $0 and $0.2 million in contract revenue was recognized for evaluation services performed, respectively.

ProGen Co., Ltd.

In June 2024, the Company and ProGen Co., Ltd. (“ProGen”) entered into a Collaboration Agreement (the “Collaboration Agreement”). Under the Collaboration Agreement, the Company and ProGen will collaborate to manufacture, develop, seek regulatory approvals for and, if approved, commercialize a product (the “Product”) combining ProGen’s GLP-1/GLP-2 dual agonist compound, PG-102, and the RaniPill HC oral delivery device (the “Device”) in the field of weight management (including without limitation obesity, weight reduction and weight maintenance) in humans (the “Collaboration”).

Under the Collaboration Agreement, development costs, as well as operating profits and losses from the commercialization of the Product, will be equally shared by the Company and ProGen. The Company and ProGen each granted to the other party an exclusive right and license (except with respect to the other party’s affiliates and sublicensees) to certain intellectual property to develop the Product for weight management and an exclusive right and license to seek regulatory approval for, and to use, sell, offer to sell, import and commercialize the Product in their assigned territories. The parties share responsibility for the development of RT-114 worldwide, with the Company leading such development for preclinical activities through Phase 1 clinical trials. After initiation of the first Phase 2 clinical trial, the Company will lead development and commercialization of the Product in the United States, Canada, Europe (including the United Kingdom) and Australia, and ProGen will lead development and commercialization in all other countries.

Each party has the right to opt-out of the Collaboration (“Opt-Out”) at any time upon prior written notice to the other party. Following an Opt-Out, the continuing party shall have sole right to develop, conduct regulatory activities for and commercialize the Product on a worldwide basis. The Opt-Out party shall share all development costs and operating profit (or loss) through the effective date of the Opt-Out, and all costs to complete the conduct of any clinical trials of Product that have been initiated prior to delivery of the Opt-Out notice, even if the costs are incurred or the trials are completed after the effective date of the Opt-Out. The continuing party shall pay to the Opt-Out party low single to mid-single digit royalties on net sales of the Product made after the Opt-Out date depending on when the Opt-Out occurs.

The Company determined that the Collaboration Agreement is not a contract with a customer and is therefore accounted for under ASC Topic 808. The Company evaluates the presentation of amounts due from ProGen based on the nature of each separate activity. Reimbursements from ProGen are recognized as contra-research and development expense on the Consolidated Statement of Operations once earned and collectability is assured. For the three and six months ended June 30, 2025, reimbursement due from ProGen recorded as contra-research and development expense was de minimis.

7. Related Party Transactions

InCube Labs, LLC (“ICL”) is wholly-owned by the Company’s founder and Chairman and his family. The founder and Chairman is the father of the Company’s Chief Executive Officer. The Company’s Chief Scientific Officer is also the brother of the founder and Chairman and thus uncle of the Company’s Chief Executive Officer.

Service Agreements

In June 2021, Rani LLC entered into a service agreement with ICL effective retrospectively to January 1, 2021, and subsequently amended such agreement in March 2022 (as amended, the "Rani LLC-ICL Service Agreement"), pursuant to which Rani LLC and ICL agreed to provide personnel services to the other upon requests. Under the amendment in March 2022, Rani LLC had a right to occupy certain facilities leased by ICL in Milpitas, California and San Antonio, Texas (“Occupancy Services”) for general office, research and development, and light manufacturing. The Rani LLC-ICL Service Agreement has a twelve-month term and will automatically renew for successive twelve-month periods unless terminated. Except for the Occupancy Services, Rani LLC or ICL may terminate services under the Rani LLC-ICL Service Agreement upon 60 days' notice to the other party. The Rani LLC-ICL Service Agreement specifies the scope of services to be provided as well as the methods for determining the costs of services. Costs are billed or charged on a monthly basis by ICL or Rani LLC, respectively. The Occupancy Services for the facility in Milpitas, California expired in August 2024. The Occupancy Services for the facility in San Antonio, Texas terminated in June 2024.

In June 2021, Rani Management Services, Inc. (“RMS”) entered into a service agreement with ICL effective retrospectively to January 1, 2021, pursuant to which ICL agreed to rent a specified portion of its facility in San Jose, California to RMS. Additionally, RMS and ICL agreed to provide personnel services to the other upon requests based on rates specified in the agreement. In April 2022, RMS assigned the agreement to Rani LLC. In December 2022, RMS was dissolved. In March 2024, the Company entered into an amendment to increase the Occupancy Services from 23,000 square feet to 24,000 square feet (such agreement, as assigned and amended, the “RMS-ICL Service Agreement”). The RMS-ICL Service Agreement has a twelve-month term and will automatically renew for successive twelve-month periods unless terminated. Rani LLC or ICL may terminate services under the RMS-ICL Service Agreement upon 60 days' notice to the other party, except for occupancy which requires six months’ notice. The RMS-ICL Service Agreement specifies the scope of services to be provided as well as the methods for determining the costs of services. Costs are billed or charged on a monthly basis by ICL or Rani LLC, respectively, as well as allocations of expenses based upon Rani LLC’s utilization of ICL’s facilities and equipment.

The table below details the amounts charged by ICL for services and rent, net of the amount that the Company charged ICL, which is included in the condensed consolidated statements of operations (in thousands):


	Three Months Ended June 30,					Six Months Ended June 30,
	2025			2024		2025			2024
Research and development	$	180		$	261	$	366		$	567
General and administrative		(13	)		97		(27	)		146
Total	$	167		$	358	$	339		$	713

As of June 30, 2025, one of the Company's facilities was owned by an entity affiliated with the Company’s Chairman (Note 8). The Company pays for the use of this facility through the RMS-ICL Service Agreement.

Exclusive License Agreement

In June 2021, ICL and the Company, through Rani LLC, entered into an Amended and Restated Exclusive License Agreement which replaced the 2012 Exclusive License Agreement between ICL and Rani LLC, as amended in 2013, and terminated the 2012 Intellectual Property Agreement between ICL and Rani LLC, as amended in June 2013. Under the Amended and Restated Exclusive License Agreement, the Company has a fully paid, exclusive license under certain scheduled patents related to optional features of the device and certain other scheduled patents to exploit products covered by those patents in the field of oral delivery of sensors, small molecule drugs or biologic drugs including, any peptide, antibody, protein, cell therapy, gene therapy or vaccine. The Company covers patent-related expenses and, after a certain period, the Company will have the right to acquire four specified United States patent families from ICL by making a one-time payment of $0.3 million to ICL for each United States patent family that the Company desires to acquire, up to $1.0 million in the aggregate. This payment will not become an obligation until the fifth anniversary of the Amended and Restated Exclusive License Agreement. The Amended and Restated Exclusive License Agreement will terminate when there are no remaining valid claims of the patents licensed under the Amended and Restated Exclusive License Agreement. Additionally, the Company may terminate the Amended and Restated Exclusive License Agreement in its entirety or as to any particular licensed patent upon notification to ICL of such intent to terminate.

Non-Exclusive License Agreement between Rani and ICL (“Non-Exclusive License Agreement”)

In June 2021, the Company, through Rani LLC, entered into the Non-Exclusive License Agreement with ICL a related party, pursuant to which the Company granted ICL a non-exclusive, fully-paid license under specified patents that were assigned from ICL to the Company. Additionally, the Company agreed not to license these patents to a third party in a specific field outside the field of oral delivery of sensors, small molecule drugs or biologic drugs including, any peptide, antibody, protein, cell therapy, gene therapy or vaccine, if ICL can prove that it or its sublicensee has been in active development of a product covered by such patents in that specific field. ICL may grant sublicenses under this license to third parties only with the Company’s prior approval. The Non-Exclusive License Agreement will continue in perpetuity unless earlier terminated.

Tax Receivable Agreement

Certain parties to the tax receivable agreement (“TRA”), entered into in August 2021 pursuant to the IPO and Organizational Transactions are related parties of the Company. The TRA provides that the Company pay to ICL and the other Continuing LLC Owners 85% of the amount of tax benefits, if any, it is deemed to realize from exchanges of Paired Interests. During each of the six months ended June 30, 2025 and 2024, these parties to the TRA exchanged zero Paired Interests that resulted in tax benefits subject to the TRA.

Rani LLC Agreement

The Company operates its business through Rani LLC. In connection with the IPO, the Company and the Continuing LLC Owners, including ICL and its affiliates, entered into the Rani LLC Agreement. The governance of Rani LLC, and the rights and obligations of the holders of LLC Interests, are set forth in the Rani LLC Agreement. As Continuing LLC Owners, ICL and its affiliates are entitled to exchange, subject to the terms of the Rani LLC Agreement, Paired Interests for Class A common stock of the Company; provided that, at the Company’s election, the Company may effect a direct exchange of such Class A common stock or make a cash payment equal to a volume weighted average market price of one share of Class A common stock for each Paired Interest redeemed.

During each of the six months ended June 30, 2025 and 2024, certain related parties that are party to the Rani LLC Agreement exchanged zero Paired Interests, for an equal number of shares of the Company's Class A common stock.

8. Leases

In November 2023, Rani LLC and BKM South Bay 240, LLC (“Landlord”) entered into the Standard Industrial/Commercial Multi-Tenant Lease - Net (the “Lease”). Pursuant to the terms of the Lease, Rani LLC is leasing approximately 33,000 square feet of space in Fremont, California, which is part of a two-building project (the “Project”). The initial term of the Lease commenced in February 2024, and the duration of the initial term is 63 months. Subject to certain conditions, Rani LLC has an option to renew the Lease for one additional 5-year term at the then-prevailing market rate. The monthly base rent for the initial term of the Lease is approximately $95,000 per month, subject to a 4% increase each year. Rani LLC is also responsible for the payment of additional rent to cover its share of common area operating expenses, including taxes, insurance, utilities, and repair and maintenance of the premises and common areas of the Project.

The Company pays for the use of its office, laboratory and manufacturing facility in San Jose, California as part of the RMS-ICL Service Agreement. In April 2022, RMS assigned the RMS-ICL Service Agreement to Rani LLC. In December 2022, RMS was dissolved. In March 2024, the Company entered into an amendment to increase the Occupancy Services from 23,000 square feet to 24,000 square feet. The RMS-ICL Service Agreement has a twelve-month term and will automatically renew for successive twelve-month periods unless Rani LLC or ICL terminate occupancy under the RMS-ICL Service Agreement upon six months’ notice. In January 2024, the Company determined it to be reasonably certain that it would exercise its renewal option for a successive twelve-month period through 2025. The Company accounted for the renewal option as a lease modification that did not result in a separate contract and recognized the additional right-of-use asset and corresponding lease liabilities associated with the Rani LLC-ICL Service Agreement in its condensed consolidated balance sheet.

Under the Rani LLC-ICL Service Agreement amended in March 2022, Rani LLC had a right to occupy certain facilities leased by ICL in Milpitas, California and San Antonio, Texas for general office, research and development, and light manufacturing. The Rani LLC-ICL Service Agreement has a twelve-month term and will automatically renew for a successive twelve-month periods unless terminated. The Company accounted for its Occupancy Services in San Antonio, Texas as a short-term lease. In December 2023, the Company provided to ICL notice of termination of the Occupancy Services in San Antonio, which took effect in June 2024. In March 2024, the Company extended the Occupancy Services for the facility in Milpitas, California for an additional six-month term through August 2024 and increased the payment for such Occupancy Services during the extension period. The Company accounted for the March 2024 extension for its Occupancy Services in Milpitas, California as a short-term lease. The Occupancy Services for the facility in Milpitas, California expired in August 2024.

The Company's leases are accounted for as operating leases and require certain fixed payments of real estate taxes and insurance in addition to future minimum lease payments, and certain variable payments of common area maintenance costs and building utilities. Variable lease payments are expensed in the period in which the obligation for those payments is incurred. These variable lease costs are payments that vary in amount beyond the commencement date, for reasons other than passage of time. Variable lease payments are excluded in the total operating lease expense and immaterial for the periods presented.

Supplemental information on the Company’s condensed consolidated balance sheet and statements of cash flows as of June 30, 2025 and 2024 and for the six months ended June 30, 2025 and 2024, respectively, related to the Company's leases was as follows (in thousands):


	June 30,
	2025			2024
Weighted-average remaining lease term (in years)		3.6			4.3
Weighted-average discount rate		10.4	%		10.4	%


	Six Months Ended June 30,
	2025		2024
Cash flows
Cash paid for amounts included in lease liabilities:
Operating cash flows used for operating leases	$	949	$	550

As of June 30, 2025, minimum annual rental payments under the Company’s operating lease agreements are as follows (in thousands), excluding short-term leases:


Year ending December 31,
2025 (remaining six months)	$	953
2026		1,229
2027		1,278
2028		1,330
2029		458
Total undiscounted future minimum lease payments	$	5,248
Less: Imputed interest		(860	)
Total operating lease liability	$	4,388
Less: Current portion of operating lease liability		1,189
Operating lease liability, less current portion	$	3,199

9. Warrants

In May 2025, in conjunction with a service agreement, the Company issued warrants to purchase 300,000 shares of the Company's Class A common stock, $0.0001 par value per share ("Service Warrants") to a third party vendor. The value of the warrants was expensed immediately as a general and administrative cost. The warrants are exercisable for a period of five years from the issuance date, at an exercise price per share equal to $0.70. The warrants include certain rights upon “fundamental transactions,” as described in the warrant agreement, including the right of the holders thereof to receive from the Company or a successor entity the same type or form of consideration (and in the same proportion) that is being offered and paid to the holders of Class A common stock in such fundamental transaction in the amount of the Black Scholes value of the unexercised portion of the applicable warrants on the date of the consummation of the fundamental transactions. As of June 30, 2025, all of the Service Warrants were outstanding.

In May 2025, the Company entered into a letter agreement (the “Letter Agreement”) with an existing institutional investor (the “Equity Investor”) pursuant to which the Equity Investor exercised for cash all outstanding Series B and Series C warrants at a reduced exercise price of $0.65 per share, for net proceeds of $3.9 million in consideration for the Company’s issuance of a new Series D common stock warrant (the “Series D Warrant”) to purchase an aggregate of 13,160,172 shares of Class A common stock, $0.0001 par value per share (the “Class A Common Stock”). Modification accounting was only performed on the warrants that were actually exercised pursuant to the Letter Agreement as it represented a short-term inducement. On the modification date, the Company remeasured the warrants at the reduced exercise price and recognized a $1.3 million inducement charge in the unaudited condensed consolidated statements of changes in stockholders' (deficit)/equity for the three and six months ended June 30, 2025.

The Series D common warrants are exercisable immediately following stockholder approval, and will expire five years from the date of stockholder approval and have an exercise price of $0.65 per share. The Series D warrants include certain rights upon “fundamental transactions,” as described in the Series D warrant agreement, including the right of the holders thereof to receive from the Company or a successor entity the same type or form of consideration (and in the same proportion) that is being offered and paid to the holders of Class A common stock in such fundamental transaction in the amount of the Black Scholes value of the unexercised portion of the applicable Series D warrants on the date of the consummation of the fundamental transactions. As of June 30, 2025, there were 13,160,172 Series D warrants outstanding.

Pursuant to the terms of the Letter Agreement, in the event that the exercise of the Series B and Series C warrants would have otherwise caused a holder to exceed the beneficial ownership limitations set forth in the existing warrant, the Company issued the number of shares that would not cause a holder to exceed such beneficial ownership limitation and agreed to hold such balance of shares of common stock in abeyance. Accordingly, at June 30, 2025, an aggregate of 1,161,000 shares of common stock were held in abeyance (the “Abeyance Shares”) with such Abeyance Shares evidenced through the holder’s existing warrants and which are deemed to be prepaid. The Abeyance Shares were to be held until notice is received by the holder that the balance of the shares of

common stock may be issued in compliance with such beneficial ownership limitations and may be exercised pursuant to a notice of exercise from the holder. The Abeyance Shares were subsequently released during July 2025.

In October 2024, the Company entered into a securities purchase agreement (the “October Securities Purchase Agreement”) with the Equity Investor relating to the issuance and sale of: (i) 3,000,000 shares of its Class A common stock, par value $0.0001 per share, (ii) pre-funded warrants to purchase 333,333 shares of Class A common stock, and (iii) Series C common warrants, which accompany the Class A common stock and pre-funded warrants, to purchase an aggregate of 3,333,333 shares of Class A common stock (the “October Offering”). Pursuant to the October Securities Purchase Agreement, Series A common warrants to purchase an aggregate of 3,246,753 shares of Class A common stock issued in connection with the July securities purchase agreement were cancelled. The pre-funded warrants were exercisable immediately and had an unlimited term and an exercise price of $0.0001 per share. The Series C common warrants were exercisable immediately following the closing date and were to expire five years from the date of issuance and originally had an exercise price of $3.00 per share. The Series C warrants included certain rights upon “fundamental transactions,” as described in the Series C warrants, including the right of the holders thereof to receive from the Company or a successor entity the same type or form of consideration (and in the same proportion) that is being offered and paid to the holders of Class A common stock in such fundamental transaction in the amount of the Black Scholes value of the unexercised portion of the applicable Series C warrants on the date of the consummation of the fundamental transactions. In October 2024, the pre-funded warrants were fully exercised for de minimis proceeds. As of June 30, 2025, all Series C warrants had been fully exercised.

In July 2024, the Company entered into a securities purchase agreement (the “July Securities Purchase Agreement”) with the Equity Investor relating to the issuance and sale of: (i) 2,800,000 shares of Class A common stock, (ii) pre-funded warrants to purchase 446,753 shares of Class A common stock, (iii) Series A common warrants, which accompany the Class A common stock and pre-funded warrants, to purchase an aggregate of 3,246,753 shares of Class A common stock and (iv) Series B common warrants, which accompany the Class A common stock and pre-funded warrants, to purchase an aggregate of 3,246,753 shares of Class A common stock (the “July Offering”). Pursuant to the October Securities Purchase Agreement, the Series A common warrants to purchase an aggregate of 3,246,753 shares of Class A common stock issued were cancelled. The Series B warrants were exercisable following the six-month anniversary of the closing date and were to expire five and a half years from the date of issuance and had an exercise price of $3.08 per share. The Series B warrants included certain rights upon “fundamental transactions,” as described in the Series B warrants, including the right of the holders thereof to receive from the Company or a successor entity the same type or form of consideration (and in the same proportion) that is being offered and paid to the holders of Class A common stock in such fundamental transaction in the amount of the Black Scholes value of the unexercised portion of the applicable Series B warrants on the date of the consummation of the fundamental transactions. In August 2024, the pre-funded warrants were fully exercised for de minimis proceeds. As of June 30, 2025, all Series B warrants had been fully exercised.

In August 2022, in conjunction with a loan and security agreement (Note 13), the Company issued warrants to purchase 76,336 shares of the Company's Class A common stock. The warrants are exercisable for a period of five years from the grant date, as may be adjusted for certain anti-dilution adjustments, dividends, stock splits, and reverse stock splits, at an exercise price per share equal to $11.79, which may be net share settled at the option of the holder. As of June 30, 2025, there were 76,336 warrants outstanding.

Warrant activity

A summary of warrant activity during the periods indicated is as follows:


	Number of Warrants			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2024		6,656,422		$	3.10		4.66	$	—
Granted		13,460,172		$	0.65		4.99	$	—
Exercised*		(6,580,086	)	$	0.65
Outstanding at June 30, 2025		13,536,508		$	0.71		4.97	$	—

* Note that these warrants had an initial exercise price of $3.00 per share and were modified during the three and six months ended June 30, 2025 to a new exercise price of $0.65 per share. Of the 6,580,086 shares received upon exercise of these warrants, 1,160,000 shares were held in abeyance at June 30, 2025.

10. Stockholders’ Equity

As of June 30, 2025, Rani Holdings held approximately 61% of the Class A Units of Rani LLC, and approximately 39% of the outstanding Class A Units of Rani LLC are held by the Continuing LLC Owners. From the date of the Organizational Transactions to June 30, 2025, 5,378,539 Paired Interests and 362,821 non-corresponding Class A Units of Rani LLC were exchanged for an equal number of shares of the Company's Class A common stock. For each of the six months ended June 30, 2025 and 2024, certain of the Continuing LLC Owners executed an exchange of zero Paired Interests and zero and 83,377 non-corresponding Class A Units of Rani LLC, respectively, in return for an equal number of shares of the Company’s Class A common stock. The corresponding shares of the Company’s Class B common stock included in the exchange of Paired Interests were subsequently canceled and retired pursuant to the terms of the Rani LLC Agreement. In accordance with the Rani LLC Agreement, Rani LLC also issues a corresponding Class A Unit to Rani Holdings for each share of common stock issued by Rani Holdings. This increases Rani Holdings’ ownership in Rani LLC.

11. Stock-Based Compensation

Stock Options

A summary of stock option activity during the periods indicated is as follows:


	Number of Stock Option Awards			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)
Balance at December 31, 2024		10,225,433		$	5.52		8.18	$	—
Granted		4,153,930		$	0.83		9.85	$	—
Canceled		(890,169	)	$	4.22
Balance at June 30, 2025		13,489,194		$	4.16		7.96	$	—
Exercisable at June 30, 2025		6,455,217		$	6.54		6.62	$	—
Nonvested at June 30, 2025		7,033,977		$	2.01		9.19	$	—

As of June 30, 2025, there was $12.9 million of unrecognized stock-based compensation expense related to stock options which is expected to be recognized over a weighted-average period of approximately 2.9 years.

The Company uses the Black-Scholes option pricing model to estimate the fair value of each stock option award on the date of grant. The assumptions and estimates are as follows:

•

Expected term - The expected term represents the period of time that stock option awards are expected to remain outstanding. The Company estimates the expected term as the midpoint between actual or expected vesting date and the contractual term.

•

Expected volatility - The expected volatility was derived from the historical stock volatilities of peer public companies within the Company's industry that are considered to be comparable businesses over a period equivalent to the expected term of the stock option awards, since there has been limited trading history of the Company's stock.

•

Risk-free interest rate - The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date of grant for zero-coupon U.S. Treasury notes with maturities approximately equal to the stock option awards’ expected term.

•

Expected dividend yield - The expected dividend yield is zero as the Company has no plans to make dividend payments.

The following table sets forth the weighted average assumptions used in estimating the fair value of stock option awards on the grant date:


		June 30,
		2025
Expected volatility

Rani Therapeutics Holdings, Inc. 10-Q