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, a 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:

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 ~~November 2, 2020,~~April 30, 2021, the registrant had ~~26,390,246~~32,371,954 shares of common stock outstanding.

	September 30, 2020			December 31, 2019			March 31, 2021			December 31, 2020
	(Unaudited)						(Unaudited)
Assets
Current Assets:
Cash and cash equivalents	$	6,280,656		$	5,663,833		$	18,185,974		$	8,068,939
Accounts receivable, net								127,795			23,311
Prepaid expenses		336,432			581,706			614,508			921,762
Inventory		86,145		—				236,044			236,480
Other current assets		11,551		—				11,703			30,300
Total current assets		6,714,784			6,245,539			19,176,024			9,280,792
Operating lease right-of-use asset		36,115			138,538			119,926			141,705
Other assets	—				11,551		—				11,551
Total assets	$	6,750,899		$	6,395,628		$	19,295,950		$	9,434,048

Liabilities and stockholders' equity
Liabilities and stockholders' (deficit) equity
Current Liabilities:
Accounts payable and accrued expenses	$	765,603		$	1,033,383		$	691,225		$	1,273,572
Accrued compensation		715,423			843,162			428,794			1,016,232
Operating lease liability		36,115			138,538			119,926			141,705
Paycheck protection program loan		104,168		—			—				104,168
Milestone payable		5,000,000		—				5,000,000			5,000,000
Other current liabilities								9,038		—
Total current liabilities		6,621,309			2,015,083			6,248,983			7,535,677

Long-term Liabilities:
Long-term liabilities
Note payable		2,000,000		—				5,000,000			5,000,000
Accrued interest payable		53,005		—				235,583			112,994
Total long-term liabilities		2,053,005		—				5,235,583			5,112,994

Total liabilities		8,674,314			2,015,083			11,484,566			12,648,671

Stockholders' equity:
Common stock, $0.0001 par value; authorized shares - 50,000,000; issued and outstanding shares - 26,332,122 and 24,431,914 at September 30, 2020 and December 31, 2019, respectively		2,633			2,443
Stockholders' (deficit) equity:
Common stock, $0.0001 par value; authorized shares - 50,000,000; issued and outstanding shares - 32,371,954 and 26,621,954 at March 31, 2021 and December 31, 2020, respectively								3,237			2,662
Additional paid-in capital		94,691,151			90,108,492			109,298,703			95,667,776
Accumulated deficit		(96,617,199	)		(85,730,390	)		(101,490,556	)		(98,885,061	)
Total stockholders' (deficit) equity		(1,923,415	)		4,380,545			7,811,384			(3,214,623	)
Total liabilities and stockholders' (deficit) equity	$	6,750,899		$	6,395,628		$	19,295,950		$	9,434,048

	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended March 31,
	2020			2019			2020			2019			2021			2020

Net product sales													$	90,421		$	—
Operating expenses:
Cost of goods sold														64,751		—
Research and development	$	205,032		$	822,444		$	6,450,979		$	2,774,924			277,825			463,853
General and administrative		1,874,578			814,218			4,387,284			2,955,371
Selling, general and administrative														2,338,295			1,329,834
Total operating expenses		2,079,610			1,636,662			10,838,263			5,730,295			2,680,871			1,793,687
Loss from operations		(2,079,610	)		(1,636,662	)		(10,838,263	)		(5,730,295	)		(2,590,450	)		(1,793,687	)
Other income (expense):
Forgiveness of paycheck protection loan and accrued interest														105,130		—
Interest income		1,033			8,597			4,896			22,868			3,164			3,378
Interest expense		(50,528	)	—				(53,442	)	—				(123,339	)	—
Total other income (expense)		(49,495	)		8,597			(48,546	)		22,868			(15,045	)		3,378
Net loss	$	(2,129,105	)	$	(1,628,065	)	$	(10,886,809	)	$	(5,707,427	)	$	(2,605,495	)	$	(1,790,309	)

Net loss per share of common stock, basic and diluted	$	(0.08	)	$	(0.07	)	$	(0.43	)	$	(0.26	)	$	(0.08	)	$	(0.07	)

Weighted-average shares used to compute basic and diluted net loss per share		26,146,220			24,128,060			25,191,359			21,623,648			31,158,065			24,439,881

																		Additional					Total
														Common Stock				Paid-In		Accumulated			Stockholders'
														Shares		Amount		Capital		Deficit			(Deficit) Equity
Balance at January 1, 2021															26,621,954	$	2,662	$	95,667,776	$	(98,885,061	)	$	(3,214,623	)
Stock-based compensation expense														—		—			561,348	—				561,348
Issuance of common stock, net															5,750,000		575		13,069,579	—				13,070,154
Net loss														—		—		—			(2,605,495	)		(2,605,495	)
Balance at March 31, 2021															32,371,954	$	3,237	$	109,298,703	$	(101,490,556	)	$	7,811,384


					Additional						Total							Additional					Total
	Common Stock				Paid-In			Accumulated			Stockholders'			Common Stock				Paid-In		Accumulated			Stockholders'
	Shares		Amount		Capital			Deficit			(Deficit) Equity			Shares		Amount		Capital		Deficit			Equity
Balance at January 1, 2020		24,431,914	$	2,443	$	90,108,492		$	(85,730,390	)	$	4,380,545			24,431,914	$	2,443	$	90,108,492	$	(85,730,390	)	$	4,380,545
Stock-based compensation expense		—		—		310,162			—			310,162		—		—			310,162	—				310,162
Issuance of common stock from employee stock purchase plan		25,000		3		21,247			—			21,250
Issuance of common stock, net															25,000	3			21,247	—				21,250
Net loss		—		—		—			(1,790,309	)		(1,790,309	)	—		—		—			(1,790,309	)		(1,790,309	)
Balance at March 31, 2020		24,456,914		2,446		90,439,901			(87,520,699	)		2,921,648			24,456,914	$	2,446	$	90,439,901	$	(87,520,699	)	$	2,921,648
Stock-based compensation expense		—		—		362,955			—			362,955
Issuance of common stock from At-The-Market offering, net		1,395,855		140		3,308,976			—			3,309,116
Issuance of common stock from warrant exercises		158,494		15		(15	)		—			—
Net loss		—		—		—			(6,967,395	)		(6,967,395	)
Balance at June 30, 2020		26,011,263		2,601		94,111,817			(94,488,094	)		(373,676	)
Stock-based compensation expense	—		—			478,574		—				478,574
Issuance of common stock from employee stock purchase plan		93,491		9		98,156		—				98,165
Issuance of common stock from warrant exercises		223,131		22		(22	)	—			—
Issuance of common stock from stock option exercise		4,237		1		2,626		—				2,627
Net loss	—		—		—				(2,129,105	)		(2,129,105	)
Balance at September 30, 2020		26,332,122	$	2,633	$	94,691,151		$	(96,617,199	)	$	(1,923,415	)


					Additional						Total
	Common Stock				Paid-In			Accumulated			Stockholders'
	Shares		Amount		Capital			Deficit			Equity
Balance at January 1, 2019		17,427,533	$	1,743	$	82,628,312		$	(78,604,735	)	$	4,025,320
Stock-based compensation expense		—		—		378,959			—			378,959
Issuance of common stock, net		450,000		45		636,387			—			636,432
Net loss		—		—		—			(1,965,266	)		(1,965,266	)
Balance at March 31, 2019		17,877,533		1,788		83,643,658			(80,570,001	)		3,075,445
Stock-based compensation expense		—		—		344,841			—			344,841
Issuance of common stock, net		6,236,423		623		5,039,333			—			5,039,956
Net loss		—		—		—			(2,114,096	)		(2,114,096	)
Balance at June 30, 2019		24,113,956		2,411		89,027,832			(82,684,097	)		6,346,146
Stock-based compensation expense		—		—		331,303			—			331,303
Issuance of common stock, net		117,958		12		123,801			—			123,813
Net loss		—		—		—			(1,628,065	)		(1,628,065	)
Balance at September 30, 2019		24,231,914	$	2,423	$	89,482,936		$	(84,312,162	)	$	5,173,197

							Three Months Ended March 31,
							2021			2020
	Nine Months Ended September 30,
	2020			2019
Operating activities
Net loss	$	(10,886,809	)	$	(5,707,427	)	$	(2,605,495	)	$	(1,790,309	)
Adjustments to reconcile net loss to net cash used in operating activities:
Forgiveness of paycheck protection loan and accrued interest								(104,168	)	—
Stock-based compensation expense		1,151,691			1,055,103			561,348			310,162
Milestone expense		5,000,000		—
Accrued interest		53,442		—
Change in operating assets and liabilities:
Prepaid expenses and other assets		261,552			(345,975	)
Accounts receivable, net								(104,484	)	—
Prepaid expenses, inventory and other assets								359,617			227,089
Accounts payable and other current liabilities		(498,379	)		383,896			(604,126	)		(140,941	)
Accrued compensation								(587,438	)		(157,896	)
Accrued interest expense								122,589		—
Deferred rent expense								9,038		—
Net cash used in operating activities		(4,918,503	)		(4,614,403	)		(2,953,119	)		(1,551,895	)

Financing activities
Proceeds from issuance of common stock, net		3,309,116			5,800,201
Proceeds from issuance of common stock, net of cost of $1,304,846								13,070,154		—
Proceeds from issuance of common stock from employee stock purchase plan		119,415		—			—				21,250
Proceeds from issuance of common stock from stock option exercised		2,627		—
Proceeds from paycheck protection program		104,168		—
Proceeds from Eversana line of credit		2,000,000		—
Net cash provided by financing activities		5,535,326			5,800,201			13,070,154			21,250
Net increase in cash and cash equivalents		616,823			1,185,798
Net increase (decrease) in cash and cash equivalents								10,117,035			(1,530,645	)
Cash and cash equivalents at beginning of period		5,663,833			5,319,004			8,068,939			5,663,833
Cash and cash equivalents at end of period	$	6,280,656		$	6,504,802		$	18,185,974		$	4,133,188

Non-cash financing activities
Forgiveness of paycheck protection loan and accrued interest							$	104,168		$	—

Evoke Pharma, Inc. (the “Company”) was incorporated in the state of Delaware in January 2007. The Company is a specialty pharmaceutical company focused primarily on the development and commercialization of drugs to treat gastroenterological disorders and disease.

Since its inception, the Company has devoted its efforts to developing its sole product, Gimoti™ (metoclopramide) nasal spray, the first and only nasally-administered product indicated for the relief of symptoms in adults with acute and recurrent diabetic gastroparesis. On June 19, 2020, the Company received approval from the U.S. Food and Drug Administration (“FDA”) for its 505(b)(2) New Drug Application (“NDA”) for Gimoti. ~~The~~As discussed in Note 5, the Company launched U.S. commercial sales of Gimoti in October 2020 through its commercial partner Eversana Life Science Services, LLC (“Eversana”).

The Company’s activities are subject to the significant risks and uncertainties associated with any specialty pharmaceutical company that has launched its first commercial product, including market acceptance of the product and the potential need to obtain additional funding for its operations.

The financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred recurring losses and negative cash flows from operations since inception and expects to continue to incur net losses for the foreseeable future until such time, if ever, that it can generate significant revenues from the sale of Gimoti. ~~Although~~As of March 31, 2021, the Company had approximately ~~$6.3~~$18.2 million in cash and cash ~~equivalents at September 30, 2020, the~~equivalents. The Company anticipates that it will continue to incur losses from operations due to commercialization activities, including manufacturing ~~commercial batches of~~ Gimoti, and selling, general and administrative costs to support operations. ~~The determination as to whether the Company can continue as a going concern contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.~~ As a result, the Company believes that there is substantial doubt about its ability to continue as a going concern for one year after the date these financial statements are issued. The financial statements do not include any adjustments that may result from the outcome of this uncertainty.

The Company’s net losses may fluctuate significantly from quarter to quarter and year to year. The Company believes, based on its current operating plan, that its ~~existing~~ cash and cash equivalents as of March 31, 2021 will be sufficient to fund its operations into the ~~second~~first quarter of ~~2021,~~2022, less than one year after the date these financial statements are issued, excluding any ~~potential additional borrowings from the revolving credit facility with Eversana (the “Eversana Credit Facility”), as discussed in Note 5, and~~ future Gimoti ~~product~~ revenue. This period could be shortened if there are any ~~unanticipated~~significant increases in planned ~~spending. Even with the remaining amount available under the Eversana Credit Facility and future Gimoti product revenue, the~~spending other than anticipated. The Company ~~may~~anticipates that it will be required to raise additional funds through debt, equity or other forms of financing, such as potential collaboration arrangements, to fund future operations and continue as a going concern.

There can be no assurance that additional financing will be available when needed or on acceptable terms. If the Company is not able to secure adequate additional funding, the Company may be forced to make reductions in spending, extend payment terms with suppliers, and/or suspend or curtail commercialization activities. Any of these actions could materially harm the Company’s business, results of operations, financial condition and future prospects. There can be no assurance that the Company will be able to successfully commercialize Gimoti. Because the Company’s business is entirely dependent on the success of Gimoti, if the Company is unable to secure additional financing, successfully commercialize Gimoti or identify and execute on strategic alternatives for Gimoti or the Company, the Company will be required to curtail all of its activities and may be required to liquidate, dissolve or otherwise wind down its operations.

The Company relies on contract research organizations (“CROs”) and consultants to assist with ongoing regulatory discussions and submissions to FDA. If these CROs and consultants are unable to continue their support, this could adversely affect the operations of the Company.

In addition, the Company relies on third-party suppliers and manufacturer for the production of Gimoti. If the third-party manufacturers are unable to continue manufacturing Gimoti, or if the Company loses one of its sole source suppliers used in its manufacturing processes, the Company may not be able to meet commercial supply demand for Gimoti and the commercialization of Gimoti could be materially and adversely affected.

The Company also relies on Eversana for the management of the commercialization of Gimoti, distribution services and a dedicated sales team to sell Gimoti. If Eversana is unable to continue serving as a dedicated sales team or distributing Gimoti, the commercialization of Gimoti could be materially and adversely affected.

~~To date,~~Despite the COVID-19 pandemic, the Company began its commercial sales of Gimoti with Eversana in October 2020. The Company has ~~not~~ experienced ~~material~~various disruptions to its ~~financial condition or operations from the novel coronavirus disease (“COVID-19”) pandemic. The Company~~sales activities, but has ~~begun~~continued its ~~commercial activities, including commercial manufacturing,~~efforts to reach physicians and ~~with Eversana, the commercial sales of Gimoti. However, there can be no assurance that the Company or Eversana will not be impacted by the COVID-19 pandemic.~~customers. For example, Eversana’s commercialization efforts ~~may be adversely~~have been affected by operational restrictions imposed on its sales force from quarantines, travel restrictions and bans and other governmental restrictions related to COVID-19. As a result of these restrictions, ~~their~~Eversana’s sales force ~~may not be able to conduct~~has been restricted from conducting in-person interactions with certain physicians and customers and ~~may be~~has been restricted to conducting Gimoti educational and promotional activities ~~for Gimoti~~ virtually in certain circumstances, which ~~may impact~~has impacted Eversana’s ability to more actively market Gimoti. ~~In addition,~~Third-party research stated that as a result of COVID-19, fewer patients are visiting physician offices resulting in lower patient volumes than normal. The Company anticipates that it and Eversana will continue to be impacted by the COVID-19 pandemic.

The COVID-19 pandemic ~~may disrupt~~has not significantly disrupted the operations of the Company’s third-party suppliers and manufacturers ~~and delay~~or delayed the Company’s manufacturing timelines of Gimoti, ~~which~~but may negatively impact the Company’s ability to successfully

commercialize Gimoti and generate product ~~sales.~~sales in the future. Further, the COVID-19 pandemic and mitigation measures have also had an adverse impact on global economic conditions which could have an adverse effect on the Company’s future business and financial condition, including impairing its ability to raise capital when needed.

In March 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was enacted in response to the COVID-19 pandemic. In April 2020, the Company applied for and was approved for a Small Business Administration (“SBA”) loan under the Paycheck Protection Program, ~~(“PPP”),~~ established by the ~~Coronavirus Aid, Relief, and Economic Security (“CARES”)~~CARES Act. On May 1, 2020, the Company received the loan proceeds of approximately $104,000. ~~Processes are being developed for companies to submit for loan forgiveness and~~In January 2021, the Company ~~plans to submit for~~received notice that its loan ~~forgiveness when such processes are finalized.~~and accrued interest were forgiven by the SBA.

The accompanying condensed balance sheet as of December 31, ~~2019,~~2020, which has been derived from audited financial statements, and the unaudited interim condensed financial statements, have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and follow the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by GAAP can be condensed or omitted. In management’s opinion, the unaudited interim financial statements have been prepared on the same basis as the audited financial statements and include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position and its results of operations and its cash flows for the periods presented. These statements do not include all disclosures required by GAAP and should be read in conjunction with the Company’s financial statements and accompanying notes for the year ended December 31, ~~2019,~~2020, which are contained in the Company’s Annual Report on Form 10-K filed with the SEC on March ~~12, 2020.~~11, 2021. The results for interim periods are not necessarily indicative of the results expected for the full fiscal year or any other interim period.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ materially from those estimates.

The Company relies on contract research organizations (“CROs”) and consultants to assist with ongoing regulatory activities. If the CROs and consultants are unable to continue their support, this could adversely affect the Company’s operations.

In addition, the Company relies on third-party manufacturers for the production of Gimoti. If the third-party manufacturers are unable to continue manufacturing Gimoti, or if the Company loses one of its sole source suppliers used in its manufacturing processes, the Company may not be able to meet any development needs or commercial supply demand for Gimoti, and the development and/or commercialization of Gimoti could be materially and adversely affected.

The Company also relies on a dedicated third-party sales team to sell Gimoti. If such third-party organization is unable to continue serving as a dedicated sales team, the commercialization of Gimoti could be materially and adversely affected.

Accounts receivable is recorded net of allowance for doubtful accounts. Estimates for allowances for doubtful accounts are determined based on existing contractual obligations and historical payment patterns. The allowance for doubtful accounts was zero at March 31, 2021 and December 31, 2020 and no bad debt expense was recorded for the three months ended March 31, 2021.

~~Subsequent~~The Company does not own or operate manufacturing facilities for the production of Gimoti, nor does it plan to develop its own manufacturing operations in the foreseeable future. The Company depends on third-party contract manufacturers for all of its required raw materials, drug substance and finished product for its commercial manufacturing. The Company has agreements with Cosma S.p.A. to supply metoclopramide for the manufacture of Gimoti, and with Thermo Fisher Scientific Inc., through its subsidiary Patheon UK Limited, for the manufacturing of Gimoti. The Company currently utilizes third-party consultants, which it engages on an as-needed, hourly basis, to manage the manufacturing contractors.

Prior to FDA approval of Gimoti in June 2020, the ~~Company began a manufacturing process for the production~~cost of ~~Gimoti for sale~~materials and began capitalizing inventory. As the manufacturing process was not completed until October 2020, the inventory was classified as work-in-process at September 30, 2020. Following the completion and release of the product by the Company’s manufacturer in October 2020, inventory is being stated at the lower of cost or net realizable value and recognized on a first-in, first-out method. Prior to FDA approval, expenses associated with the manufacturing of Gimoti were recorded as research and development expense.

Subsequent to FDA approval, the Company began manufacturing Gimoti for commercialization and began capitalizing inventory. The ~~Company will analyze its~~Company’s inventory ~~levels on a periodic basis to determine if any inventory is~~consisted of approximately $151,000 of raw materials and approximately $85,000 of finished goods at ~~risk for expiration prior to sale~~March 31, 2021 and December 31, 2020. Inventories are stated at the lower of cost (first-in first-out basis) or ~~has a cost basis that is greater than its estimated future~~ net realizable value. ~~Any adjustments~~Inventory when written down to net realizable value establishes a new cost basis and its value is not subsequently increased based upon changes in underlying facts and circumstances. The Company’s raw materials inventory is held at its third-party suppliers and its finished goods inventory is held at its contract manufacturer and at Eversana. The Company records such inventory as consigned inventory.

The Company’s ability to generate revenue and become profitable depends on its ability to successfully commercialize Gimoti, which was launched in the United States through prescription in October 2020 through the Company’s commercial partner Eversana. If the Company or Eversana fail to successfully launch Gimoti and grow and maintain sales, the Company may never generate significant revenues and its results of operations and financial position will be adversely affected.

In accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, the Company recognizes revenue when a customer obtains control of promised goods in an amount that reflects the consideration the Company expects to receive in exchange for the goods provided. Customer control is determined upon the customer’s physical receipt of the product. To determine revenue recognition for arrangements within the scope of ASC 606, the Company performs the following five steps: identify the contracts with the customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when (or as) it satisfies a performance obligation. At contract inception, the Company assesses the goods promised within each contract and determines those that are performance obligations and assesses whether each promised good is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when the customer obtains control of the product.

Product sales are recorded at the transaction price, which includes variable considerations for co-payment assistance to commercially insured patients meeting certain eligibility requirements, as well as to uninsured patients. Co-payment assistance is recorded as an offset to gross revenue at the time revenue from the product sale is recognized ~~through cost~~based on expected and actual program participation. Co-pay liabilities are estimated using prescribing data available from customers. Actual amounts of ~~sales~~consideration ultimately received may materially differ from the Company’s estimates. If actual results in the future vary from estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known.

Liabilities for co-pay assistance are classified as accounts payable and accrued expenses in ~~which they are incurred.~~the balance sheets.

Stock-based compensation expense for stock option grants and employee stock purchases under the Company’s Employee Stock Purchase Plan (the “ESPP”) is recorded at the estimated fair value of the award as of the grant date and is recognized as expense on a straight-line basis over the employee’s requisite service period, except awards with a performance condition. Awards with a performance ~~conditions~~condition commence vesting when the satisfaction of the performance condition is probable. The estimation of stock option and ESPP fair value requires management to make estimates and judgments about, among other things, employee exercise behavior, forfeiture rates and volatility of the Company’s common stock. The judgments directly affect the amount of compensation expense that will be recognized.

The Company grants stock options to purchase common stock to employees and members of the board of directors with exercise prices equal to the Company’s closing market price on the date the stock options are granted. The risk-free interest rate assumption was based

on the yield of an applicable rate for U.S. Treasury instruments with maturities similar to those of the expected term of the award being valued. The ~~weighted-average~~weighted average expected term of options and employee stock purchases was calculated using the simplified method as prescribed by accounting guidance for stock-based compensation. This decision was based on the lack of relevant historical data due to the Company’s limited historical experience. In addition, due to the Company’s limited historical data, the estimated volatility was calculated based upon the Company’s historical volatility, supplemented, as necessary, with historical volatility of comparable companies in the biotechnology industry whose share prices are publicly available for a sufficient period of time. The assumed dividend yield was based on the Company never paying cash dividends and having no expectation of paying cash dividends in the foreseeable future. The Company accounts for forfeitures as the forfeitures occur.

Research and development costs are expensed as incurred and primarily include compensation and related benefits, stock-based compensation expense, costs paid to third-party contractors for product development activities and drug product materials, and technology acquisition milestones. The Company has expensed costs relating to the purchase and production of pre-approval inventories as research and development expense in the period incurred prior to FDA approval received on June 19, 2020.

The Company ~~does not own or operate~~will expense the clinical, regulatory and manufacturing ~~facilities for~~costs related to the ~~production~~post-marketing commitment to conduct a single dose pharmacokinetics (“PK”) clinical trial of Gimoti ~~nor does it plan~~ to ~~develop its own manufacturing operations in the foreseeable future. The Company depended on third-party contract manufacturers for all~~characterize dose proportionality of its required raw materials, drug substance and finished product for its pre-commercial product development, and will continue to depend on such third-party manufacturers for its commercial manufacturing. The Company has agreements with Cosma S.p.A. to supply metoclopramide for the manufacturea lower dose strength of Gimoti, ~~and with Thermo Fisher Scientific Inc., through its subsidiary Patheon UK Limited,~~as well
as other costs that may occur for any additional clinical trials the ~~manufacturing~~Company may pursue to expand the indication of Gimoti. ~~The Company currently utilizes third-party consultants, which it engages on an as-needed, hourly basis, to manage product development and manufacturing contractors.~~

Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common stock outstanding for the period, without consideration for common stock equivalents. Diluted net loss per share is calculated by dividing the net loss by the weighted-average number of common share equivalents outstanding for the period determined using the treasury-stock method. Dilutive common stock equivalents are comprised of warrants to purchase common stock, options to purchase common stock under the

Company’s equity incentive plans and potential shares to be purchased under the ESPP. For the periods presented, the following table sets forth the outstanding potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to do so would be anti-dilutive:

	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2020		2019		2020		2019		2021		2020
Warrants to purchase common stock		1,841,879		2,713,561		1,841,879		2,713,561		1,841,879		2,713,561
Common stock options		4,273,065		3,114,371		4,273,065		3,114,371		5,392,259		3,989,371
Employee stock purchase plan		4,716		7,294		4,716		7,294	—			24,714
Total excluded securities		6,119,660		5,835,226		6,119,660		5,835,226		7,234,138		6,727,646

In June 2007, the Company acquired all worldwide rights, data, patents and other related assets associated with Gimoti from Questcor Pharmaceuticals, Inc. (“Questcor”) pursuant to an Asset Purchase Agreement. The Company paid Questcor $650,000 in the form of an upfront payment and $500,000 in May 2014 as a milestone payment based upon the initiation of the first patient dosing in the Company’s Phase 3 clinical trial for Gimoti. In August 2014, Mallinckrodt, plc (“Mallinckrodt”) acquired Questcor. As a result of that acquisition, Questcor transferred its rights included in the Asset Purchase Agreement with the Company to Mallinckrodt. In addition to the payments previously made to Questcor, the Company may also be required to make additional milestone payments totaling up to $52 million. In March 2018, the Company and Mallinckrodt amended the Asset Purchase Agreement to defer development and approval milestone payments, such that, rather than paying two milestone payments based on FDA acceptance for review of the NDA and final product marketing approval, the Company would be required to make a single $5 million payment on the one-year anniversary after the Company receives FDA approval to market Gimoti. At the time of the Gimoti NDA approval by FDA, the Company recorded the $5 million payable owed to Mallinckrodt with a due date of June 19, 2021, along with a $5 million research and development expense.

The remaining $47 million in milestone payments depend on Gimoti’s commercial success. The Company will be required to pay Mallinckrodt a low single digit royalty on net sales of Gimoti. The Company’s obligation to pay such royalties will terminate upon the expiration of the last patent right covering Gimoti, which is expected to occur in ~~2032,~~2030, subject to possible extension should any additional, later expiring, licensed patents be granted.

In January 2021, the Company completed the sale of 5,750,000 shares of its common stock in an underwritten public offering. The price to the public in this offering was $2.50 per share resulting in gross proceeds to the Company of approximately $14.4 million. After deducting underwriting discounts and commissions and offering expenses paid by the Company, the net proceeds to the Company raised from this offering were approximately $13.1 million.

In November 2017, the Company filed a shelf registration statement with the SEC on Form S-3. The shelf registration statement ~~includes~~included a prospectus for the at-the-market offering to sell up to an aggregate of $16.0 million of shares of the Company’s common stock through B. Riley FBR, Inc. (“FBR”) as a sales agent (the “FBR Sales Agreement”). During the ~~nine~~three months ended ~~September 30, 2019,~~March 31, 2021 and 2020, there were no shares sold under the FBR Sales Agreement. Effective January 6, 2021, the Company ~~sold 6,804,381~~terminated the FBR Sales Agreement.

In December 2020, the Company filed a new shelf registration statement with the SEC on Form S-3, or the replacement shelf registration statement. The replacement shelf registration statement replaced the registration statement on Form S-3 the Company originally filed with the SEC in November 2017, which registration statement expired in December 2020. The replacement shelf registration was declared effective by the SEC on January 6, 2021. In December 2020, the Company also entered into a new At Market Issuance Sales Agreement (the “ATM Sales Agreement”), with FBR and H.C. Wainwright & Co. (together with FBR, the “Sales Agents”), pursuant to which the Company may sell from time to time, at its option, up to an aggregate of $30 million worth of shares of the Company’s common stock ~~at a weighted-average price per share of $0.87~~through the Sales Agents. The ATM Sales Agreement provides, among other things, that sales under the ATM Sales Agreement will be made pursuant to the ~~FBR Sales Agreement and received proceeds~~replacement shelf registration statement, including the base prospectus filed as part of ~~approximately $5.8 million, net of commissions and fees.~~such registration statement. During the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, there were no shares sold under the ~~Company sold 1,395,855 shares of common stock at a weighted-average price per share of $2.42 pursuant to the FBR~~ATM Sales ~~Agreement and received proceeds of approximately $3.3 million, net of commissions and fees.~~Agreement.

Future sales under the ATM Sales Agreement will depend on a variety of factors including, but not limited to, market conditions, the trading price of the Company’s common stock and the Company’s capital needs. There can be no assurance that ~~FBR~~the Sales Agents will be successful in consummating future sales based on prevailing market conditions or in the quantities or at the prices that the Company deems appropriate.

In addition, the Company will not be able to make future sales of common stock pursuant to the ~~FBR~~ATM Sales Agreement unless certain conditions are met, which include the accuracy of representations and warranties made to ~~FBR~~the Sales Agents under the ~~FBR~~ATM Sales Agreement. Furthermore, ~~FBR~~each of the Sales Agents is permitted to terminate the ~~FBR~~ATM Sales Agreement with respect to itself in its sole discretion upon ten days’ notice, or at any time in certain circumstances, including the occurrence of an event that would be reasonably likely to have a material adverse effect on the Company’s assets, business, operations, earnings, properties, condition (financial or otherwise), prospects, stockholders’ equity or results of operations. The Company has no obligation to sell the ~~remaining~~ shares available for sale pursuant to the ~~FBR~~ATM Sales Agreement.

During the nine months ended September 30, 2020, certain holders of warrants exercised their warrants to purchase 871,682 shares of the Company’s common stock by a “cashless” exercise and received 381,625 shares of the Company’s common stock. The warrants had exercise prices ranging from $2.41 to $3.12 per share. The shares were issued, and the warrants were originally sold, in reliance upon the registration exemption set forth in Section 4(a)(2) of the Securities Act of 1933.

During the nine months ended September 30, 2020, certain holders of stock options exercised their stock options to purchase 4,237 shares of the Company’s common stock. The stock options had exercise prices of $0.62 per share.

Stock-based compensation expense includes charges related to employee stock purchases under the ESPP and stock option grants. The Company measures stock-based compensation expense based on the grant date fair value of any awards granted to its employees. Such expense is recognized over the period of time that employees provide service and earn rights to the awards.

During the ~~nine~~three months ended ~~September 30,~~March 31, 2021 and 2020, the Company granted stock options to purchase ~~1,172,000~~1,315,000 and 875,000 shares of the Company’s common ~~stock.~~stock, respectively. Of ~~such~~the options ~~437,500~~granted in 2020, 50% did not begin vesting until June 19, 2020, the date that FDA approved the Gimoti NDA. The estimated fair value of each stock option award granted was determined on the date of grant using the ~~Black Scholes~~Black-Scholes option-pricing valuation model with the following weighted-average assumptions for option grants during the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 and ~~2019:~~2020:

	Nine Months Ended September 30,		Three Months Ended March 31,
	2020	2019	2021	2020
Common Stock Options
Risk free interest rate	0.39% - 0.96%	1.80% - 2.55%	0.57%	0.96%
Expected option term	5.5 - 6.0 years	4.27 - 6.0 years	6.0 years	6.0 years
Expected volatility of common stock	99.73% - 103.99%	90.34% - 112.58%	103.45%	99.73%
Expected dividend yield	0.0%	0.0%	0.0%	0.0%

The estimated fair value of the shares to be acquired under the ESPP was determined on the initiation date of each six-month purchase period using the Black-Scholes option-pricing valuation model with the following weighted-average assumptions for ESPP shares to be purchased during the three ~~and nine~~ months ended ~~September 30, 2020 and 2019:~~March 31, 2020:

There were no employee withholdings to purchase shares during the six-month purchase period beginning March 1, 2021.

The Company recognized ~~non-cash~~ stock-based compensation expense to employees and directors in its research and development and its selling, general and administrative functions during the three ~~and nine~~ months ended ~~September 30,~~March 31, 2021 and 2020 ~~and 2019~~ as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2020		2019		2020		2019		2021		2020
Research and development	$	31,186	$	179,227	$	286,148	$	533,518	$	68,380	$	120,562
General and administrative		447,388		152,076		865,543		521,585
Selling, general and administrative										492,968		189,600
Total stock-based compensation expense	$	478,574	$	331,303	$	1,151,691	$	1,055,103	$	561,348	$	310,162

As of ~~September 30, 2020,~~March 31, 2021, there was approximately ~~$2.5~~$4.3 million of unrecognized compensation costs related to outstanding employee and board of director options, which are expected to be recognized over a weighted-average period of ~~1.13~~1.59 years.

On January 21, 2020, the Company entered into a commercial services agreement (the “Eversana Agreement”) with Eversana for the commercialization of Gimoti. Pursuant to the Eversana Agreement, Eversana ~~will commercialize~~commercializes and ~~distribute~~distributes Gimoti in the United States. Eversana ~~will manage~~also manages the marketing of Gimoti to targeted health care providers, as well as the sales and distribution of Gimoti ~~within~~in the United States.

Under the terms of the Eversana Agreement, the Company maintains ownership of the Gimoti NDA, as well as legal, regulatory, and manufacturing responsibilities for Gimoti. Eversana will utilize its internal sales organization, along with other commercial functions,

for market access, marketing, distribution and other related patient support services. The Company will record sales for Gimoti and retain more than 80% of net product profits once the parties’ costs are reimbursed. As of March 31, 2021, unreimbursed commercialization costs to Eversana were approximately $13.1 million. Such costs will generally be payable only as net product profits are recognized. Eversana will receive reimbursement of its commercialization costs pursuant to an agreed upon budget and a percentage of product profits in the mid-to-high teens. Net product profits are the net sales (as defined in the Eversana Agreement) of Gimoti, less (i) reimbursed commercialization costs, (ii) manufacturing and administrative costs set at a fixed percentage of net sales, and (iii) third party royalties. During the term of the Eversana Agreement, Eversana agreed to not market, promote, or sell a competing product in the United States.

The Eversana Agreement terminates on June 19, 2025, unless terminated earlier pursuant to its terms. Upon expiration or termination of the agreement, the Company will retain all profits from product sales and assume all corresponding commercialization responsibilities. Within 30 days after each of the first three annual anniversaries of commercial launch, either party may terminate the agreement if net sales of Gimoti do not meet certain annual thresholds. Either party may terminate the agreement: for the material breach of the other party, subject to a 60-day cure period; in the event an insolvency, petition of the other party is pending for more than 60 days; upon 30 days written notice to the other party if Gimoti is subject to a safety recall; if the other party is in breach of certain regulatory compliance representations under the agreement; if the Company discontinues the development or production of Gimoti; if the net profit is negative for any two consecutive calendar quarters beginning with the first full calendar quarter 24 months following commercial launch; if the cumulative net product profits fail to reach certain thresholds in the first three years following commercial launch; or if there is a change in applicable laws that makes operation of the services as contemplated under the agreement illegal or commercially impractical. Either party may also terminate the Eversana Agreement upon a change of control of the Company’s ownership, subject, in the event that the Company initiates such termination, to a one-time payment equal to between two times and one times annualized service fees paid by the Company under the Eversana Agreement, with such amount based on which year after commercial launch the change of control occurs. Such payment amount would be reduced by the amount of previously reimbursed commercialization costs and profit split paid for the related prior twelve-month period and any revenue which occurred prior to the termination yet to be collected. If Eversana terminates the agreement due to an uncured material breach by the Company, or if the Company terminates the Eversana Agreement in certain circumstances, the Company has agreed to reimburse Eversana for its unreimbursed commercialization costs for the prior twelve-month period and certain other costs. In addition, Eversana may terminate the Eversana Agreement if the Company withdraws Gimoti from the market for more than 90 days.

In connection with the Eversana Agreement, the Company and Eversana ~~also~~have entered into the Eversana Credit Facility, pursuant to which Eversana agreed to provide a revolving Credit Facility of up to $5 million to the Company upon FDA approval of the Gimoti NDA, as well as certain other customary conditions. The Eversana Credit Facility terminates on June 19, 2025, unless terminated

earlier pursuant to its terms. The Eversana Credit Facility is secured by all of the Company’s personal property other than ~~its~~the Company’s intellectual property. Under the terms of the Eversana Credit Facility, the Company cannot grant an interest in ~~its~~the Company’s intellectual property to any other person. Each loan under the Eversana Credit Facility will bear interest at an annual rate equal to 10.0%, with such interest due at the end of the loan term. In June 2020 the Company borrowed $2 million ~~from~~and in December 2020 it borrowed the remaining $3 million under the Eversana Credit Facility.

The Company may prepay any amounts borrowed under the Eversana Credit Facility at any time without penalty or premium. The maturity date of all amounts, including interest, borrowed under the Eversana Credit Facility will be 90 days after the expiration or earlier termination of the Eversana Agreement. The Eversana Credit Facility also includes events of default, the occurrence and continuation of which provide Eversana with the right to exercise remedies against the Company and the collateral securing the loans under the Eversana Credit Facility, including the Company’s cash. These events of default include, among other things, the Company’s failure to pay any amounts due under the Eversana Credit Facility, an uncured material breach of the representations, warranties and other obligations under the Eversana Credit Facility, the occurrence of insolvency events and the occurrence of a change in control.

I~~tem~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with our financial statements and accompanying notes included in this Quarterly Report on Form 10-Q and the ~~audited~~ financial statements and accompanying notes thereto for the fiscal year ended December 31, ~~2019~~2020 and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, both of which are contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission, or SEC, on March ~~12, 2020.~~11, 2021. Past operating results are not necessarily indicative of results that may occur in future periods.

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. 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 financial position, business strategy, commercial activities to be conducted by Eversana Life Science Services, LLC, or Eversana, the pricing and reimbursement for Gimoti, future regulatory developments, research and development costs, the timing and likelihood of success, plans and objectives of management for future operations, future results of current and anticipated products and the ~~expected~~ impact of the ~~novel~~ coronavirus, or COVID-19, pandemic, on us or on third parties on whom we rely, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that 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 statement. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. Although we believe the expectations reflected in these forward-looking statements are reasonable, such statements are inherently subject to risk and we can give no assurances that our expectations will prove to be correct. Given these risks, uncertainties and other factors, you should not place undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. You should read this Quarterly Report on Form 10-Q completely. As a result of many factors, including without limitation those set forth under “Risk Factors” under Item 1A of Part II below, and elsewhere in this Quarterly Report on Form 10-Q, our actual results may differ materially from those anticipated in these forward-looking statements. Except as required by applicable law, we undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this report or to reflect actual outcomes. For all forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

We use our registered trademark, EVOKE PHARMA, and ~~our trademarked product name,~~other trademarks, including GIMOTI and EvokeAssist, in this Quarterly Report on Form 10-Q. This Quarterly Report on Form 10-Q also includes trademarks, tradenames and service marks that are the property of other organizations. Solely for convenience, trademarks and tradenames referred to in this Quarterly Report on Form 10-Q appear without the ® and ™ 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 or that the applicable owner will not assert its rights, to these trademarks and tradenames.

Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to “Evoke,” “we,” “us” and “our” refer to Evoke Pharma, Inc.

We are a specialty pharmaceutical company focused primarily on the development and commercialization of drugs to treat gastrointestinal, or GI, disorders and diseases. Since our inception, we have devoted our efforts to developing our sole product, Gimoti (metoclopramide) nasal spray, the first and only nasally-administered product indicated for the relief of symptoms in adults with acute and recurrent diabetic gastroparesis. On June 19, 2020, we received approval from the U.S. Food and Drug Administration, or FDA, for our 505(b)(2) New Drug Application, or NDA, for Gimoti. We launched ~~U.S.~~ commercial sales of Gimoti in the United States in October 2020 through our commercial partner Eversana.

Diabetic gastroparesis is a GI disorder affecting millions of patients worldwide, in which ~~the~~food in an individual’s stomach takes too long to empty ~~its contents~~ resulting in a variety of serious GI symptoms ~~as well as other system~~and systemic metabolic complications. The gastric delay caused by gastroparesis can compromise absorption of orally administered medications. ~~Gimoti is the only nasally-administered drug currently approved in the United States to treat the symptoms in adults with acute and recurrent diabetic gastroparesis.~~

On January 21, 2020, we entered into an agreement with Eversana, or the Eversana Agreement, for the commercialization of ~~Gimoti, or the Eversana Agreement.~~Gimoti. Pursuant to the Eversana Agreement, Eversana commercializes and distributes Gimoti in the United States. Eversana also manages the marketing of Gimoti to targeted health care providers, as well as the sales and distribution of Gimoti ~~within~~in the United States.

Eversana also provided a $5 million revolving credit facility, or the Eversana Credit Facility, ~~which~~that became available upon FDA approval of ~~Gimoti.~~the Gimoti NDA. In June 2020 we borrowed $2 million and in December 2020 we borrowed the remaining $3 million under the Eversana Credit Facility.

We have primarily funded our operations through the sale of our convertible preferred stock prior to our initial public offering in September 2013, borrowings under our bank loans and the sale of shares of our common stock on the Nasdaq Capital Market. We ~~have~~

launched commercial sales of Gimoti in late October 2020 with Eversana and, to date, have generated modest sales given the launch occurred during the COVID-19 pandemic and we were entering the holiday season.

We have incurred losses in each year since our inception. These operating losses resulted from expenses incurred in connection with advancing Gimoti through development activities and selling, general and administrative costs associated with our operations. We expect to continue to incur operating losses until revenues from sales of Gimoti ~~which we launched in October 2020,~~ exceed our expenses, if ever. We may never become profitable, or if we do, we may not be able to sustain profitability on a recurring basis.

As of ~~September 30, 2020,~~March 31, 2021, we had cash and cash equivalents of approximately ~~$6.3~~$18.2 million. Current cash on hand is intended to fund commercialization activities for Gimoti, including manufacturing ~~commercial batches~~Gimoti, conducting the post-marketing commitment single dose PK clinical trial of Gimoti to characterize dose proportionality of a lower dose strength of Gimoti and any additional development activities should we seek additional indications, protecting our intellectual property portfolio and for selling, general and administrative costs to support operations. Our operations have consumed substantial amounts of cash since inception. We believe, based on our current operating plan, that our existing cash and cash equivalents as of March 31, 2021 will be sufficient to fund our operations into the ~~second~~first quarter of ~~2021,~~2022, excluding ~~any potential additional borrowings from the Eversana Credit Facility and~~ future Gimoti ~~product~~ revenue. This period could be shortened if there are any ~~unanticipated~~significant increases in planned spending ~~including as a result of the COVID-19 pandemic. Even with the remaining amount available under the Eversana Credit Facility, and Gimoti product revenue,~~other than anticipated. We anticipate that we ~~may~~will be required to raise additional funds in order to continue as a going concern. Because our business is entirely dependent on the success of Gimoti, if we are unable to secure additional financing ~~successfully commercialize Gimoti~~ or identify and execute on other development or strategic alternatives for Gimoti or our company, we will be required to curtail all of our activities and may be required to liquidate, dissolve or otherwise wind down our operations. Any of these events could result in a complete loss of your investment in our securities.

~~To date,~~Despite the COVID-19 pandemic, we began our commercial sales of Gimoti with Eversana in October 2020. We have ~~not~~ experienced ~~material~~various disruptions to our ~~financial condition or operations from the novel coronavirus disease, or COVID-19 pandemic. We~~sales activities, but have ~~begun~~continued our ~~commercial activities, including commercial manufacturing,~~efforts to reach physicians and ~~with Eversana commercial sales of Gimoti. However, there can be no assurance that we or Eversana will not be impacted by the COVID-19 pandemic.~~customers. For example, Eversana’s commercialization efforts ~~may be~~have been adversely affected by operational restrictions imposed on its sales force from quarantines, travel restrictions and bans, and other governmental restrictions related to COVID-19. As a result of these restrictions, their sales force ~~may not be able to conduct~~has been restricted from conducting in-person interactions with certain physicians and customers and ~~may be~~has been restricted to conducting Gimoti educational and promotional activities ~~for Gimoti~~ virtually in certain circumstances, which ~~may impact~~has impacted Eversana’s ability to more actively market Gimoti. ~~In addition,~~Research conducted by IOVIA stated that as a result of COVID-19, fewer patients are visiting physician offices resulting in lower patient volumes than normal, and the Centers for Disease Control and Prevention reported during 2020 that over 40% of patients were avoiding care due to COVID-19. We anticipate that we and Eversana will continue to be impacted by the COVID-19 pandemic.

The COVID-19 pandemic ~~may disrupt~~has not significantly disrupted the operations of our third-party suppliers and manufacturers ~~and delay~~or delayed our manufacturing timelines of Gimoti, ~~which~~but may negatively impact our ability to successfully commercialize Gimoti and generate product ~~sales.~~sales in the future. Further, the COVID-19 pandemic and mitigation measures have also had an adverse impact on global economic conditions which could have an adverse effect on our future business and financial condition, including impairing our ability to raise capital when needed.

In March 2020, the Coronavirus Aid, Relief, and Economic Security, or CARES, Act was enacted in response to the COVID-19 pandemic. In April 2020, we applied for and were approved for a Small Business Administration, or SBA, loan under the Paycheck Protection Program ~~or PPP,~~ established by the ~~Coronavirus Aid, Relief, And Economic Security, or~~ CARES Act. On May 1, 2020, we received the loan proceeds of approximately $104,000. ~~Based on the SBA guidelines,~~In January 2021, we ~~believe~~received notice that ~~the balance of the~~our loan and accrued interest ~~will be~~were forgiven ~~in accordance with~~by the ~~terms of the PPP loan. Processes are being developed for companies to submit for loan forgiveness and we plan to submit for loan forgiveness when such processes are finalized.~~SBA.

In June 2007, we acquired all worldwide rights, data, patents and other related assets associated with Gimoti from Questcor Pharmaceuticals, Inc., or Questcor, pursuant to an asset purchase agreement. We paid Questcor $650,000 in the form of an upfront payment and $500,000 in May 2014 as a milestone payment based upon the initiation of the first patient dosing in our Phase 3 clinical trial for Gimoti. In August 2014, Mallinckrodt, plc, or Mallinckrodt, acquired Questcor. As a result of that acquisition, Questcor transferred its rights included in the asset purchase agreement with us to Mallinckrodt. In addition to the payments previously made to Questcor, we may be required to make additional milestone payments totaling up to $52 million. In March 2018, we amended the asset purchase agreement with Mallinckrodt to defer development and approval milestone payments, such that rather than paying two milestone payments based on FDA acceptance for review of the NDA and final product marketing approval, we would be required to make a single $5 million payment ~~one year~~on the one-year anniversary after we receive FDA approval to market Gimoti. At the time of the Gimoti NDA approval by FDA, we recorded the $5 million payable owed to Mallinckrodt with a due date of June 19, 2021, along with a $5 million research and development expense.

The remaining $47 million in milestone payments depend on Gimoti’s commercial success. We will be required to pay to Mallinckrodt a low single digit royalty on net sales of Gimoti. Our obligation to pay such royalties will terminate upon the expiration of the last patent right covering Gimoti, which is expected to occur in ~~2032,~~2030, subject to possible extension should any additional, later expiring, licensed patents be granted.

Our ability to generate revenue and become profitable depends on our ability to successfully commercialize Gimoti, which we launched in the United States through prescription in October 2020 through our commercial partner Eversana. If we or Eversana fail to successfully launch Gimoti and grow and maintain sales, we may never generate significant revenues and our results of operations and financial position will be adversely affected.

In accordance with Accounting Standards Codification, or ASC, 606, Revenue from Contracts with Customers, we recognize revenue when a customer obtains control of promised goods in an amount that reflects the consideration we expect to receive in exchange for the goods provided. Customer control is determined upon the customer’s physical receipt of the product. To determine revenue recognition for arrangements within the scope of ASC 606, we perform the following five steps: identify the contracts with the customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when (or as) it satisfies a performance obligation. At contract inception, we assess the goods promised within each contract and determine those that are performance obligations and assess whether each promised good is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when the customer obtains control of the product.

Co-pay liabilities are estimated using prescribing data available from customers. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known.

Liabilities for co-pay assistance are classified as accounts payable and accrued expenses in the balance sheets.

Gimoti revenues continue to increase on several metrics. During the first quarter of 2021 compared to the fourth quarter of 2020, Gimoti experienced a nearly 293% growth of net product sales and 235% growth in the number of prescriptions. New prescribers of Gimoti increased from 45 during the fourth quarter of 2020 to 84 (87% increase) during the first quarter of 2021. In addition, during April 2021, we had 44 additional new prescribers. Enrollments into the EvokeAssist reimbursement center have grown each month, with April 2021 having the largest number of monthly enrollments to date. Patients that have an opportunity to refill the product (that is, patients who have completed their current supply and have additional refills on their prescription) get a refill at least 73% of the time.

In December 2020 and January 2021, we began accessing the Medicare and Medicaid systems, respectively, to allow for reimbursement submission of products for patients seeking treatment. For the quarter ended March 31, 2021, these government programs made up approximately 40% of the filled prescriptions for Gimoti. Through March 31, 2021, the patients have been mostly between the ages of 31-65. The vast majority are female and were being treated by a gastroenterologist.

The feedback from the Eversana sales organization continues to be positive with regard to physician interest. Although many target physician offices are only recently allowing face to face visits by sales team members, meetings with gastroenterology teams continue to generate positive enrollments and fills. Furthermore, we have detected a pattern within larger gastroenterology teams that the first physician adopting the use of Gimoti has led other physicians within the same practice to begin prescribing Gimoti as well. These market experiences follow the recently conducted market research announced in January 2021, which indicated, among other positive trends and benefits, that 79% and 89% of target and non-target gastroenterologists, respectively, intend to prescribe Gimoti.

We expense all research and development expenses as they are incurred. Research and development expenses primarily include:

All of our research and development expenses to date have been incurred in connection with the development of Gimoti. With ~~the~~ FDA approval of Gimoti, we expect research and development costs to decrease and shift to commercialization and selling costs. However, we ~~expect to begin~~have initiated planning for an FDA post-marketing commitment ~~pharmacokinetics~~single dose PK clinical trial of Gimoti to characterize dose proportionality of a lower dose strength of Gimoti, as well as other costs that may occur for any additional clinical trials we may pursue to expand the indication of Gimoti. This trial ~~which we expect~~will be designed to ~~begin in 2021, will~~ characterize dose proportionality of a lower dosage strength of Gimoti to accommodate patients that may require further dosage adjustments. We are unable to estimate with any certainty the costs we will incur related to this trial, or the regulatory review of such lower dosage of Gimoti, though such costs may be significant. Clinical development timelines, the probability of success and development costs can differ materially from expectations.

The costs of clinical trials may vary significantly over the life of a project owing to, but not limited to, the following:

~~General~~Selling, general and administrative expenses consist primarily of salaries and related benefits, including stock-based compensation. Other selling, general and administrative expenses include professional fees for accounting, tax, patent costs, legal services, insurance, facility costs and costs associated with being a publicly-traded company, including fees associated with investor relations and directors and officers liability insurance premiums. We expect that selling, general and administrative expenses will increase in the future as we continue to progress with the commercialization of Gimoti and we reimburse Eversana from the net profits attained from the sales of Gimoti.

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with generally accepted accounting principles in the United States, or GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses during the reporting periods. We evaluate these estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Our actual results may differ materially from these estimates under different assumptions or conditions.

The critical accounting policies and estimates underlying the accompanying unaudited financial statements are those set forth in Part II, Item 7 included in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2019,~~2020, which was filed with the SEC on March ~~12, 2020.~~11, 2021.

Comparison of Three Months Ended ~~September 30,~~March 31, 2021 and 2020 ~~and 2019~~

The following table summarizes the results of our operations for the three months ended ~~September 30, 2020~~March 31, 2021 and ~~2019:~~2020:

	Three Months Ended September 30,				Increase/			Three Months Ended March 31,				Increase/ (Decrease)
	2020		2019		(Decrease)			2021		2020
Research and development expenses	$	205,032	$	822,444	$	(617,412	)	$	277,825	$	463,853	$	(186,028	)
General and administrative expenses	$	1,874,578	$	814,218	$	1,060,360
Selling, general and administrative expenses								$	2,338,295	$	1,329,834	$	1,008,461

Research and Development Expenses. Research and development expenses for the three months ended ~~September 30, 2020~~March 31, 2021 compared to the three months ended ~~September 30, 2019~~March 31, 2020 decreased by approximately ~~$617,000. The decrease during the three months ended September 30, 2020 is primarily due to a decrease in research and development activity following the Gimoti NDA approval by FDA in June 2020.~~$186,000. During ~~the three months ended September 30, 2020,~~2021, we incurred ~~costs of approximately $158,000 related primarily to continued~~expenses for stability testing of batches of Gimoti manufactured prior to receipt of FDA approval ~~and~~of the Gimoti NDA in June 2020, as well as preparing for a post-marketing commitment to conduct a single dose PK clinical trial of Gimoti to characterize dose proportionality of a lower dose strength of Gimoti.

Costs incurred in 2021 included approximately ~~$36,000~~$168,000 for wages, taxes and employee insurance, including approximately ~~$31,000~~$68,000 of stock-based compensation ~~expense. Following FDA approval of Gimoti,~~expense, and ~~until we begin our post-marketing commitment pharmacokinetics trial, which is expected~~approximately $77,000 related to begin in 2021, we expect future research and development expenses to remain consistent with the current quarter as we have shifted our focus to commercialization and selling activities, but we will continue to test the stability of Gimoti manufactured prior to approval.

~~In 2019,~~manufacturing. During 2020, we incurred expenses ~~primarily related to~~ responding to requests for additional information from FDA and preparing for ~~the Gimoti NDA~~future manufacturing and ~~manufacturing registration batches~~potential commercial launch of ~~Gimoti as required by FDA.~~Gimoti. Costs incurred in ~~2019~~2020 included approximately ~~$493,000~~$370,000 for wages, taxes and employee insurance, including approximately ~~$179,000~~$121,000 of stock-based compensation expense, and approximately ~~$248,000~~$76,000 related to ~~manufacturing, and approximately $75,000 related to responding to FDA information requests on the NDA and preparing for the NDA resubmission.~~manufacturing.

Selling, General and Administrative Expenses. ~~General~~Selling, general and administrative expenses for the three months ended ~~September 30, 2020~~March 31, 2021 compared to the three months ended ~~September 30, 2019~~March 31, 2020 increased by approximately ~~$1.1 million as we have shifted our focus to selling activities.~~$1.0 million. Costs incurred in ~~2020~~2021 primarily included approximately ~~$1.1~~$1.2 million for wages, taxes and employee insurance, including approximately ~~$447,000~~$493,000 of stock-based compensation expense, and approximately ~~$654,000~~$749,000 for legal, accounting, directors and officers liability insurance and other costs associated with being a public company. Of the total selling, general and administrative expenses incurred during the three months ended ~~September 30, 2020,~~March 31, 2021, approximately ~~$745,000~~$842,000 related to wages, taxes, employee insurance, stock-based compensation, and other commercialization activities. Costs incurred in ~~2019~~2020 primarily included approximately ~~$423,000~~$624,000 for wages, taxes and employee insurance, including approximately ~~$152,000~~$190,000 of stock-based compensation expense, and approximately $326,000 for legal, accounting, directors and officers liability insurance and other costs associated with being a public company. General and administration costs are expected to increase in future periods as we continue to progress with the commercialization of Gimoti.

~~The following table summarizes the results of our operations for the nine months ended September 30, 2020 and 2019:~~

~~Research and Development Expenses.~~ Research and development expenses for the nine months ended September 30, 2020 compared to the nine months ended September 30, 2019 increased by approximately $3.7 million. The increase during the nine months ended September 30, 2020 is primarily due to recording a $5 million expense in June 2020 upon achieving a technology acquisition milestone related to FDA’s approval of Gimoti. Although the expense was recorded when incurred, the payment is not due to Mallinckrodt until June 19, 2021. During the nine months ended September 30,2020, we also incurred expenses responding to requests for additional information from FDA related to the NDA and preparing for future manufacturing and the commercial launch of Gimoti. Excluding the Mallinckrodt milestone expense, research and development expenses decreased during 2020 as we have shifted our focus to commercialization and selling activities. Costs incurred in 2020 included approximately $784,000 for wages, taxes and employee insurance, including approximately $286,000 of stock-based compensation expense, and approximately $581,000 related to acquiring raw material prior to obtaining FDA approval of Gimoti and to continued testing of Gimoti batches that were manufactured prior to FDA approval.

In 2019, we incurred expenses primarily related to responding to requests for additional information from FDA and manufacturing registration batches of Gimoti as required by FDA. Costs incurred in 2019 included approximately $1.8 million for wages, taxes and employee insurance, including approximately $534,000 of stock-based compensation expense, approximately $787,000 related to manufacturing, and approximately $150,000 related to responding to FDA information requests regarding the NDA and preparing for the NDA resubmission.

~~General and Administrative Expenses.~~ General and administrative expenses for the nine months ended September 30, 2020 compared to the nine months ended September 30, 2019 increased by approximately $1.4 million. Costs incurred in 2020 primarily included approximately $2.3 million for wages, taxes and employee insurance, including approximately $866,000 of stock-based compensation expense, and approximately $1.8 million$634,000 for legal, accounting, directors and officers liability insurance and other costs associated with being a public company. Of the total selling, general and administrative expenses incurred during the ~~nine~~three months ended ~~September 30,~~March 31, 2020, approximately ~~$1.2 million~~$100,000 related to wages, taxes, employee insurance, stock-based compensation, and other costs related to pre-commercialization ~~and commercialization~~ activities. Costs incurred in 2019 primarily included approximately $1.4 million for wages, taxes and employee insurance, including approximately $522,000 of stock-based compensation expense, approximately $1.2 million for legal, accounting, directors and officers liability insurance and other costs associated with being a public company, approximately $116,000 for outside consultants and approximately $68,000 for pre-commercialization costs.

In November 2017, we filed a shelf registration statement with the SEC on Form S-3. The shelf registration statement ~~includes~~included a prospectus for the at-the-market offering to sell up to an aggregate of $16.0 million of shares of our common stock through B. Riley FBR, Inc., or FBR, as a sales agent, or FBR Sales Agreement. ~~During the nine months ended September 30, 2019, we~~There were no shares sold 6,804,381 shares of common stock at a weighted-average price per share of $0.87 pursuant to the FBR Sales Agreement and received proceeds of approximately $5.8 million, net of commissions and fees. During the nine months ended September 30, 2020, we sold 1,395,855 shares of common stock at a weighted-average price per share of $2.42 pursuant to the FBR Sales Agreement and received proceeds of approximately $3.3 million, net of commissions and fees.

~~As of October 31, 2020, we had the capacity to issue up to approximately $1.7 million of additional shares of common stock pursuant to the FBR Sales Agreement. Future sales~~ under the FBR Sales Agreement ~~will depend~~during the three months ended March 31, 2021 and 2020. Effective January 6, 2021, we terminated the FBR Sales Agreement.

In December 2020, we filed a new shelf registration statement with the SEC on ~~a variety~~Form S-3, or the replacement shelf registration statement. The replacement shelf registration statement replaced the registration statement on Form S-3 we originally filed with the SEC in November 2017, which registration statement expired in December 2020. The replacement shelf registration was declared effective by the SEC on January 6, 2021. In December 2020, we also entered into the ATM Sales Agreement with FBR and H.C. Wainwright & Co., LLC pursuant to which we may sell from time to time, at our option, up to an aggregate of ~~factors including, but not limited to, market conditions, the trading price~~$30 million worth of shares of our common stock ~~and our capital needs. There can be no assurance~~through the Sales Agents. The ATM Sales Agreement provides, among other things, that ~~FBR~~sales under the ATM Sales Agreement will be ~~successful in consummating future sales based on prevailing market conditions or in~~made pursuant to the ~~quantities or at~~replacement shelf registration statement, including the ~~prices that we deem appropriate.~~base prospectus filed as part of such registration statement. There were no shares sold under the ATM Sales Agreement during the three months ended March 31, 2021.

Under current SEC regulations, if at the time we file our Annual Report on Form 10-K ~~and~~ our public float is less than $75 million, and for so long as our public float remains less than $75 million, the amount we can raise through primary public offerings of securities in any twelve-month period using shelf registration statements is limited to an aggregate of one-third of our public float, which is referred to as the baby shelf rules. ~~During June 2020,~~As of March 11, 2021, the date we filed our Annual Report on Form 10-K, our public float exceeded $75 million, thereby allowing us to conduct primary offerings without being constrained by the baby shelf rules. We will remain unconstrained by the baby shelf rules under our Form S-3 shelf registration statement until the date we file a new registration statement or our Form 10-K for the fiscal year ending December 31, ~~2020,~~2021, at which time if our public float is less than $75 million, the ~~amount~~number of securities we may sell under a Form S-3 registration statement will again be limited by the baby shelf rules.

Future sales under the ATM Sales Agreement will depend on a variety of factors including, but not limited to, market conditions, the trading price of our common stock and our capital needs. There can be no assurance that the Sales Agents will be successful in consummating future sales based on prevailing market conditions or in the quantities or at the prices that we deem appropriate.

In addition, we will not be able to make future sales of common stock pursuant to the ~~FBR~~ATM Sales Agreement unless certain conditions are met, which include the accuracy of representations and warranties made to ~~FBR~~the Sales Agents under the ~~FBR~~ATM Sales Agreement. Furthermore, ~~FBR~~each of the Sales Agents is permitted to terminate the ~~FBR~~ATM Sales Agreement with respect to itself in its sole discretion upon ten days’ notice, or at any time in certain circumstances, including the occurrence of an event that would be reasonably likely to have a material adverse effect on our assets, business, operations, earnings, properties, condition (financial or otherwise), prospects, stockholders’ equity or results of operations. We have no obligation to sell the ~~remaining~~ shares available for sale pursuant to the ~~FBR~~ATM Sales Agreement.

In connection with the Eversana Agreement, we entered into the Eversana Credit Facility, pursuant to which Eversana agreed to provide a revolving ~~Credit Facility~~credit facility of up to $5 million to us upon FDA approval of the Gimoti NDA, as well as certain other customary conditions. The Eversana Credit Facility terminates on June 19, 2025, unless terminated earlier pursuant to its terms. The Eversana Credit Facility is secured by all of the Company’s personal property other than its intellectual property. Under the terms of the Eversana Credit Facility, we cannot grant an interest in our intellectual property to any other person. Each loan under the Eversana Credit Facility will bear interest at an annual rate equal to 10.0%, with such interest due at the end of the loan term. In June 2020 we borrowed $2 million and in December 2020 we borrowed $3 million from the Eversana Credit Facility.

In January 2021, we completed the sale of 5,750,000 shares of our common stock in an underwritten public offering led by Laidlaw & Company (UK) Ltd. The price to the public in this offering was $2.50 per share resulting in gross proceeds to us of approximately $14.4 million. After deducting underwriting discounts and commissions, and offering expenses paid by us, the net proceeds to us raised from this offering were approximately $13.1 million.

Management concluded that there is substantial doubt about our ability to continue as a going concern. Our independent registered public accounting firm also included an explanatory paragraph in their report on our financial statements as of and for the year ended December 31, 2020 with respect to our ability to continue as a going concern. This doubt about our ability to continue as a going concern for at least twelve months from the date of the financial statements could materially limit our ability to raise additional funds through the issuance of new debt or equity securities or otherwise. Future reports on our financial statements may also include an explanatory paragraph with respect to our ability to continue as a going concern. We have incurred significant losses since our inception and have never been profitable, and it is possible we will never achieve profitability. ~~As of September 30, 2020, we had cash and cash equivalents of approximately $6.3 million.~~ We believe, based on our current operating plan, that our

existing cash and cash equivalents will be sufficient to fund our operations into the ~~second~~first quarter of ~~2021,~~2022, excluding any ~~potential additional borrowings from the Eversana Credit Facility and~~ future Gimoti ~~product~~ revenue. This period could be shortened if there are ~~unanticipated~~any significant increases in planned spending ~~including as a result of the COVID-19 pandemic. Even with the Eversana Credit Facility and Gimoti product revenue,~~other than anticipated. We anticipate that we ~~may~~will be required to raise additional funds ~~through debt, equity or other forms of financing, such as potential collaboration arrangements,~~in order to ~~fund future operations and~~ continue as a going concern. Because our business is entirely dependent on the success of Gimoti, if we are unable to secure additional financing ~~successfully commercialize Gimoti,~~ or identify and execute on other development or strategic alternatives for Gimoti or our company, we will be required to curtail all of our activities and may be required to liquidate, dissolve or otherwise wind down our operations. Any of these events could result in a complete loss of your investment in our securities.

These estimates of cash runway could be shortened if there are any significant increases in planned spending on commercialization activities, including for marketing and manufacturing of Gimoti, and our selling, general and administrative costs to support operations. There is no assurance that other financing will be available when needed to allow us to continue as a going concern. The perception that we may not be able to continue as a going concern may cause others to choose not to deal with us due to concerns about our ability to meet our contractual obligations.

The following table summarizes our cash flows for the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 and ~~2019:~~2020:

	Nine Months Ended September 30,						Increase/			Three Months Ended March 31,
	2020			2019			(Decrease)			2021			2020
Net cash used in operating activities	$	(4,918,503	)	$	(4,614,403	)	$	304,100		$	(2,953,119	)	$	(1,551,895	)
Net cash provided by financing activities	$	5,535,326		$	5,800,201		$	(264,875	)	$	13,070,154		$	21,250
Net increase (decrease) in cash and cash equivalents	$	616,823		$	1,185,798		$	(568,975	)	$	10,117,035		$	(1,530,645	)

Operating Activities. The primary use of our cash has been to fund our clinical research, prepare our NDA, manufacture Gimoti, prepare for and begin commercial sales of Gimoti, and other general operations. The cash used in operating activities during the ~~nine~~three months ended ~~September 30,~~March 31, 2021 was primarily related to commercialization activities for Gimoti. The cash used in operating activities during the three months ended March 31, 2020 was primarily related to ongoing communication with FDA related to the resubmitted NDA, and pre-approval and commercialization activities and other ongoing costs of operating the business. The cash used in operating activities during the nine months ended September 30, 2019 was primarily related to ongoing communication with FDA related to the NDA and to manufacturing registration batches of Gimoti.pre-commercialization activities. We expect that cash used in operating activities will increase in 2021 due to commercialization activities, including manufacturing of Gimoti, and the planned post-marketing commitment to conduct a single dose PK clinical trial of Gimoti to characterize dose proportionality of a lower dose strength of Gimoti.

Financing Activities. During the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, we received net proceeds of approximately ~~$3.3~~$13.1 million from the sale of ~~1,395,855~~5,750,000 shares of common stock pursuant to an underwritten public offering. During the ~~FBR Sales Agreement, $2 million from borrowings under the Eversana Credit Facility, approximately $104,000 from the PPP loan, and approximately $119,000~~three months ended March 31, 2020, we received proceeds of $21,250 from the sale of ~~118,491~~25,000 shares of common stock pursuant to our ~~ESPP. During the nine months ended September 30, 2019, we received net proceeds of approximately $5.8 million from the sale of 6,804,381 shares of common stock pursuant to the FBR Sales Agreement.~~Employee Stock Purchase Plan.

The amount and timing of our future funding requirements will depend on many factors, including but not limited to:

Through ~~September 30, 2020,~~March 31, 2021, we have not entered into and did not have any relationships with unconsolidated entities or financial collaborations, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purpose.

There were no material changes outside the ordinary course of our business during the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 to the information regarding our contractual obligations that was disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, filed with the SEC on March 12, 2020, except for the $2 million borrowing from Eversana as discussed in Note 5 in our Notes to Condensed Financial Statements. In addition, with the approval of the Gimoti NDA, we are now committed to pay Mallinckrodt $5 million as discussed in Note 3 in our Notes to Condensed Financial Statements.11, 2021.

As of ~~September 30, 2020,~~March 31, 2021, there have been no material changes in our market risk from that described in “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations – Quantitative and Qualitative Disclosures about Market Risk” in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2019,~~2020, filed with the SEC on March ~~12, 2020.~~11, 2021.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the timelines specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Business Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can only provide reasonable assurance of achieving the desired control objectives, and in reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. In addition, the design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, control may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

As required by SEC Rule 13a-15(b), as of ~~September 30, 2020~~March 31, 2021 we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Business Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as of the end of the period covered by this report. Based on the foregoing, our Chief Executive Officer and Chief Business Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of ~~September 30, 2020.~~March 31, 2021.

There were no changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(d) or 15d-15(d) of the Exchange Act during the quarter ended ~~September 30, 2020~~March 31, 2021 that materially affect, or are reasonably likely to materially affect, our internal control over financial reporting.

There have been no material changes to the risk factors included in “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2019,~~2020, filed with the SEC on March ~~12, 2020, or the 2019 annual report,~~11, 2021 other than as ~~set forth below:~~follows:

~~Risks Related~~Our business and operations would suffer in the event of system failures, including cyberattacks.

Despite the implementation of security measures, our internal computer systems and those of our current and any future CROs and other contractors and consultants and collaborators are vulnerable to damage from computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures. For example, we have been the target of a cyber-attack which resulted in the misappropriation of an immaterial amount our funds and we may be subject to further cyber-attacks seeking to misappropriate our funds or otherwise disrupt our business. Although we have implemented certain additional procedures to reduce the risk of another successful cyber-attack, we cannot be sure that similar cyber-attacks or failures will not occur in the future. Attacks upon information technology systems are increasing in their frequency, levels of persistence, sophistication and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives and expertise. As a result of the COVID-19 pandemic, we may also face increased cybersecurity risks due to our ~~Business, including~~reliance on internet technology and the ~~Regulatory Compliance and Commercialization~~number of our ~~Product, Gimoti~~

~~Our business is entirely dependent on the success of Gimoti,~~employees who are working remotely, which may ~~never generate sufficient sales~~create additional opportunities for cybercriminals to ~~become profitable.~~

~~To date,~~exploit vulnerabilities. Furthermore, because the techniques used to obtain unauthorized access to, or to sabotage, systems change frequently and often are not recognized until launched against a target, we ~~have devoted all of our research, development and clinical efforts and financial resources toward the development of our only product, Gimoti.~~

Because our business is entirely dependent on the success of Gimoti, if we are unable to successfully commercialize this product, we will be required to curtail all of our activities and may be required to liquidate, dissolve or otherwise wind down our operations. Any of these events could result in the complete loss of an investment in our securities.

In addition to the other factors included in “Item 1A. Risk Factors” in our 2019 annual report, the future commercial success of Gimoti is subject to a number of additional risks, including the following:

~~We may require substantial additional funding and~~ may be unable to ~~raise capital when needed, which would force us~~anticipate these techniques or implement adequate preventative measures. We may also experience security breaches that may remain undetected for an extended period. If another cyber-attack were to ~~liquidate, dissolve or otherwise wind down our operations.~~

~~Our operations have consumed substantial amounts of cash since inception. We believe, based on our current operating plan, that our existing cash~~occur and ~~cash equivalents will be sufficient to fund~~cause interruptions in our operations, into the second quarter of 2021, excluding the $3.0 million remaining amount available under the Eversana Credit Facility and future Gimoti product revenue. This period could be shortened if there are any significant increases in planned spending other than anticipated. Even with the remaining amount available under the Eversana Credit Facility and Gimoti product revenue, we will likely be required to raise additional funds through debt, equity or other forms of financing, such as potential collaboration arrangements, to fund future operations and continue as a going concern. There can be no assurance that we will be able to raise additional funds on acceptable terms, or at all. Because our business is entirely dependent on the success of Gimoti, if we are unable to secure additional financing, successfully commercialize Gimoti or identify and execute on other commercialization or strategic alternatives for Gimoti or our company, we will be required to curtail all of our activities and may be required to liquidate, dissolve or otherwise wind down our operations. Any of these eventsit could result in a ~~complete~~material disruption of our development program for Gimoti and our business operations. For example, the loss of ~~your investment in our securities.~~

Our estimates of the amount of cash necessary to fund our activities may prove to be wrong and we could spend our available financial resources much faster than we currently expect. Our future funding requirements will depend on many factors, including, but not limited to:

Additional funding may not be available to us on acceptable terms or at all. In addition, the terms of any financing may adversely affect the holdings or the rights of our stockholders. Furthermore, the issuance of additional shares or other securities by us, or the possibility of such issuance, may cause the market price of our shares to decline and dilute the holdings of our existing stockholders. If we raise additional funds by incurring debt, the terms of the debt may involve significant cash payment obligations, as well as covenants and specific financial ratios that may restrict our ability to operate our business. We cannot provide any assurance that our existing capital resources will be sufficient to enable us to identify or execute a viable plan for continued clinical development of Gimoti or to otherwise survive as a going concern.

~~Any termination or suspension of, or delays in the completion of, the post-marketing pharmacokinetics trial of Gimoti or any other~~ future clinical trials could result in ~~increased~~delays in our regulatory approval efforts and significantly increase our costs to ~~us, delay~~recover or ~~limit our ability~~reproduce the data. Likewise, we rely on third parties to ~~generate revenue~~manufacture Gimoti and ~~adversely affect our commercial prospects.~~

~~In connection with FDA’s approval of Gimoti, we committed to~~ conduct a pharmacokinetics trial to characterize dose proportionality of a lower dose strength compared to the current 15 mg dose strength. We expect to initiate this trial in 2021. We do not know whether any trials will produce data on schedule, if at all. The commencement and completion of clinical trials can be delayed for a number of reasons, including delays related to:

In addition, disruptions caused by the COVID-19 pandemic may increase the likelihood that we encounter such difficulties or delays in initiating, enrolling, conducting or completing our planned and ongoing clinical trials. Product development costs will increase if we need to perform more or larger clinical trials than planned. Additionally, changes in regulatory requirements and policies may occur and we may need to amend clinical trial protocols to reflect these changes. Amendments may require us to resubmit our clinical trial protocols to IRBs for reexamination, which may impact the costs, timing or successful completion of a clinical trial. If we experience delays in completion of or if we, FDA or other regulatory authorities, the IRB, or other reviewing entities, or any of our clinical trial sites suspend or terminate any of our clinical trials, the commercial prospects for our product candidate may be harmed and our ability to generate product revenues will be delayed. In addition, many of the factors that cause, or lead to, termination or suspension of, or a delay in the commencement or completion of, clinical trials may also ultimately lead to the denial of regulatory approval of a product candidate.

~~Delays in the completion of any~~ clinical trials, and ~~studies we may conduct for Gimoti~~similar events relating to their computer systems could ~~be harmful to our business and cause us to require additional funding.~~

Use of Gimoti or any future product candidates we may develop could be associated with side effects, adverse events or other properties or safety risks, which could delay or preclude approval, cause us to suspend or discontinue clinical trials, abandon a product candidate, limit the commercial profile of the approved labeling, or result in other significant negative consequences that could severely harm our business, prospects, operating results and financial condition.

~~If we or others identify undesirable side effects, or other previously unknown problems, with Gimoti, a number of potentially significant negative consequences could result, including:~~

Moreover, if any future product candidates we may develop are associated with undesirable side effects in clinical trials or have characteristics that are unexpected, we may elect to abandon their development or limit their development to more narrow uses or subpopulations in which the undesirable side effects or other characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective, which may limit the commercial prospects for the product candidate, if approved. Undesirable side effects could cause us or regulatory authorities to interrupt, delay or halt clinical trials, result in a more restrictive label than proposed, or delay or cause the denial of regulatory approvals by FDA or comparable foreign regulatory authorities. The drug-related side effects could also affect patient recruitment for our clinical trials, or the ability of enrolled patients to complete the trials, or result in potential product liability claims. We may also be required to modify our plans for future studies based on findings in our ongoing clinical trials. Many compounds that initially showed promise in early-stage testing have later been found to cause side effects that prevented further development of the compound. In addition, regulatory authorities may draw different conclusions or require additional testing to confirm these determinations. Any of these occurrences may harm our business, financial condition and prospects significantly.

Undesirable side effects or other previously unknown problems could prevent us from achieving or maintaining market acceptance of Gimoti, or our future product candidates, if approved, and could substantially increase the costs of commercializing and developing such products or product candidates.

~~Our business may be impacted by epidemic diseases such as the recent global outbreak of the COVID-19 coronavirus.~~

In March 2020, the World Health Organization declared the outbreak of COVID-19, which has spread across the United States and worldwide, to be a pandemic. A pandemic, including COVID-19 or other public health epidemics, poses the risk that we or our employees, or our third-party suppliers and manufacturers may be prevented from conducting business activities for an indefinite period of time, including due to spread of the disease within these groups or due to shutdowns that may be requested or mandated by governmental authorities. To date, we have not experienced material disruptions to our financial condition or operations from COVID-19. However, there can be no assurance that we or Eversana will not be impacted in the future by the COVID-19 pandemic. The continued spread of COVID-19 and the measures taken by the governments of countries affected could disrupt the raw material supply chain and the manufacture or shipment of Gimoti for commercial sale or cause us and Eversana to delay or materially modify our commercial plans, which could increase costs or decrease potential Gimoti revenues and have a material adverse effect on our ~~business, financial condition~~business. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and ~~results of operations. For example,~~ ~~Eversana’s~~the further development and commercialization ~~efforts may be adversely affected by operational restrictions imposed on its sales force from quarantines, travel restrictions and bans and other governmental restrictions~~

related to COVID-19. As a result of these restrictions, their sales force may not be able to conduct in-person interactions with physicians and customers and may be restricted to conducting educational and promotional activities for Gimoti virtually, which may impact Eversana’s ability to market Gimoti. In addition, the COVID-19 pandemic may disrupt the operations of our ~~third-party suppliers and manufacturers and delay our manufacturing timelines of Gimoti, which may negatively impact our ability to successfully commercialize Gimoti and generate~~ product ~~sales.~~ ~~COVID-19 may also impact the costs and timing of our planned~~ ~~post-marketing commitment pharmacokinetics trial of Gimoti.~~ ~~Moreover, to the extent any of these risks and uncertainties adversely impact us in the ways described above~~candidate could be delayed, or otherwise they may also have the effect of heightening many of the other risks set forth in our 2019 annual report. The COVID-19 pandemic and mitigation measures have also had an adverse impact on global economic conditions which could have an adverse effect on our business and financial condition, including impairing our ability to raise capital when needed. The extent to which the COVID-19 pandemic impacts our manufacturing capabilities and commercial plans and other results will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning the actions to contain its impact and treat the disease.

Disruptions at FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.

The ability of FDA to review and approve new products can be affected by a variety of factors, including government budget and funding levels, statutory, regulatory, and policy changes, FDA’s ability to hire and retain key personnel and accept the payment of user fees, and other events that may otherwise affect FDA’s ability to perform routine functions. Average review times at the agency have fluctuated in recent years as a result. In addition, government funding of other government agencies that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable. Disruptions at FDA and other agencies may also slow the time necessary for new drugs or modifications to approved drugs to be reviewed and/or approved by necessary government agencies, which would adversely affect our business. For example, over the last several years, including for 35 days beginning on December 22, 2018, the U.S. government has shut down several times and certain regulatory agencies, such as FDA, have had to furlough critical FDA employees and stop critical activities. affected.

Separately, in response to the COVID-19 pandemic, on March 10, 2020 FDA announced its intention to postpone most foreign inspections of manufacturing facilities and products through April 2020, and subsequently, on March 18, 2020, FDA announced its intention to temporarily postpone routine surveillance inspections of domestic manufacturing facilities. Regulatory authorities outside the United States may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic. If a prolonged government shutdown occurs, or if global health concerns continue to prevent FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Delaware		20-8447886
(State or other jurisdiction of incorporation)		(IRS Employer Identification No.)

420 Stevens Avenue, Suite 370, Solana Beach, CA		92075
(Address of principal executive offices)		(Zip Code)

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

PART I. FINANCIAL INFORMATION	1
Item 1. Financial Statements	1
Condensed Balance Sheets as of ~~September 30, 2020~~March 31, 2021 (Unaudited) and December 31, ~~2019~~2020	1
Condensed Statements of Operations for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2021 and 2020 ~~and 2019~~ (Unaudited)	2
Condensed Statements of Stockholders’ (Deficit) Equity for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2021 and 2020 ~~and 2019 (Unaudited)~~(Unaudited)	3
Condensed Statements of Cash Flows for the ~~nine~~three months ended ~~September 30,~~March 31, 2021 and 2020 ~~and 2019~~ (Unaudited)	4
Notes to Condensed Financial Statements (Unaudited)	5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3. Quantitative and Qualitative Disclosures about Market Risk	17
Item 4. Controls and Procedures	1718
PART II. OTHER INFORMATION	1819
Item 1. Legal Proceedings	1819
Item 1A. Risk Factors	1819
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	2119
Item 3. Defaults Upon Senior Securities	2119
Item 4. Mine Safety Disclosures	2119
Item 5. Other Information	2119
Item 6. Exhibits	2220
SIGNATURES	2421

Exhibit Number		Description of Exhibit

3.1 (1)		Amended and Restated Certificate of Incorporation of the Company

3.2 (1)		Amended and Restated Bylaws of the Company

4.1 (2)		Form of the Company’s Common Stock Certificate

4.2 (3)		~~Investor Rights Agreement dated as of June 1, 2007~~

~~4.3 (3)~~		Warrant dated June 1, 2012 issued by the Company to Silicon Valley Bank

~~4.4~~4.3 (4)		Form of Warrant issued by the Company to certain investors under the Securities Purchase Agreement between the Company and such investors dated July 25, 2016

~~4.5~~4.4 (5)		Form of Warrant issued by the Company to certain investors under the Securities Purchase Agreement between the Company and such investors dated August 3, 2016

~~4.6~~4.5 (6)		Form of Amendment to Common Stock Purchase Warrant, amending certain of the warrants dated July 25, 2016 and August 3, 2016

~~4.7~~4.6 (7)		Form of Amendment to Common Stock Purchase Warrant, amending certain of the warrants dated July 25, 2016 and August 3, 2016

~~4.8~~4.7 (8)		Form of Amendment to Common Stock Purchase Warrant, amending certain of the warrants dated July 25, 2016 and August 3, 2016

~~4.9~~4.8 (9)		Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934

~~10.1~~†		~~3PL Agreement between the Company and Eversana Life Science Services, Inc. dated August 27, 2020~~

31.1*		Certification of Chief Executive Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of 1934

31.2*		Certification of Chief Financial Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of 1934

32.1*		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2*		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

	Evoke Pharma, Inc.

Date: ~~November 10, 2020~~May 12, 2021	By:	/s/ David A. Gonyer
		David A. Gonyer President and Chief Executive Officer (Principal Executive Officer)

Date: ~~November 10, 2020~~May 12, 2021	By:	/s/ Matthew J. D’Onofrio
		Matthew J. D’Onofrio Executive Vice President, Chief Business Officer, Treasurer and Secretary (Principal Financial and Accounting Officer)