Cash Flows Comparison of Years Ended December 31, 2019 and 2018 The following table summarizes our cash flows for the years ended December 31, 2019 and 2018 (in thousands): Cash Flows from Operating Activities Net cash used in operating activities was $0.6 million for the year ended December 31, 2019 and consisted primarily of a net loss of $3.8 million, capitalized debt discount of $13 thousand and a loss on debt extinguishment of $2.6 million. This net loss was partially offset by non-cash items such as $108 thousand in share-based compensation expense, $66 thousand of debt discount and debt issue cost amortization expense, $66 thousand of depreciation expense, and $207 thousand of intangible asset amortization expense with $154 thousand in net cash outflows from changes in operating assets and liabilities. Cash outflows from changes in operating assets and liabilities of $154 thousand were primarily due to $78 thousand increase in collaboration revenue receivable and $379 thousand decrease in accounts payable and accrued expenses. These cash outflows were partially offset by a decreases of $55 thousand in royalty receivables, $67 thousand in income tax receivable, $394 thousand in accrued interest and $44 thousand in prepaid expenses and other current assets and increases of $18 thousand in other current liabilities. Net cash used in operating activities was $3.9 million for the year ended December 31, 2018 and consisted primarily of a net loss of $3.8 million, capitalized debt discount of $172 thousand and a gain on the debt extinguishment of $296 thousand. This net loss was partially offset by non-cash items such as $218 thousand in share-based compensation expense, $87 thousand of debt discount and debt issue cost amortization expense, $73 thousand of depreciation expense, and $207 thousand of intangible asset amortization expense with $183 thousand in net cash outflows from changes in operating assets and liabilities. Cash outflows from changes in operating assets and liabilities of $896 thousand were primarily due to $66 thousand increase in royalty receivable and $830 thousand decreases in both accrued interest and accrued expenses. These cash outflows were partially offset by a $109 thousand decrease in prepaid expenses and other current assets and increase of $604 in accounts payable. Cash Flows from Investing Activities We had no investing activities for the years ended December 31, 2019 and 2018. Cash Flows from Financing Activities Net cash provided by financing activities was $1.4 million for the year ended December 31, 2019 and consisted of the net proceeds from loans provided by Mr. Schutte. Net cash provided by financing activities was $1.8 million for the year ended December 31, 2018 and consisted of the $4.350 million net proceeds from loans provided by Mr. Schutte partially offset by $2.6 million principal repayments and debt retirement on the loan with Oxford Finance.

Year Ended

December 31,

2019	2018

Net cash (used in) provided by:

Operating activities	$(618)	$(3,908)

Investing activities	-	-

Financing activities	1,389	1,779

Net increase (decrease) in cash and cash equivalents	$771	$(2,129)

Question: What are the primary factors that caused a negative balance in operating activities in 2019?
Answer: Net cash used in operating activities was $0.6 million for the year ended December 31, 2019 and consisted primarily of a net loss of $3.8 million, capitalized debt discount of $13 thousand and a loss on debt extinguishment of $2.6 million.