Following Otonomy, Inc.'s previously announced plans to pause its product development activities and take other steps to reduce costs in order to preserve its cash resources, and in connection with the planned Dissolution, the Company has reduced its workforce, including the termination of all employees, effective as of December 15, 2022 (the Reduction). The Company estimates that it will incur aggregate charges of approximately $5.0 million for severance and other employee termination-related costs in the fourth quarter of 2022. The costs that the Company expects to incur are subject to a number of assumptions, and actual results may differ from the Company's original estimate.

The Company may also incur additional costs not currently contemplated due to events that may occur as a result of, or that are associated with, these actions.