What changed in this filing

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Item 1. Financial Statements

2026-08-06 compared with 2026-05-07 · 72 added, 57 removed, 387 unchanged (25% of the section changed)

23 unchanged sentences

Preferred stock, $ 0.00001 par value;

10,000,000 shares authorized and no shares issued or outstanding at March 31, 2026 and December 31, 2025

10,000,000 shares authorized and no shares issued or outstanding at June 30, 2026 and December 31, 2025

Common stock, $ 0.00001 par value;

400,000,000 shares authorized at March 31, 2026 and December 31, 2025;

139,652,849 and 120,499,433 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively

400,000,000 shares authorized at June 30, 2026 and December 31, 2025;

139,824,273 and 120,499,433 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively

Additional paid‑in capital

Accumulated other comprehensive income

Accumulated other comprehensive (loss) income

Accumulated deficit

( 1,009,113 )

Total stockholders’ equity

5 unchanged sentences

Three Months Ended

Six Months Ended

Contract research

31 unchanged sentences

Balance at March 31, 2026

Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units

Unrealized loss on marketable securities

Stock-based compensation expense

Balance at June 30, 2026

( 1,009,113 )

Comprehensive

Stockholders’

Income (Loss)

Balance at December 31, 2024

3 unchanged sentences

Balance at March 31, 2025

Issuance of common stock in connection with vesting of restricted stock units

Unrealized gain on marketable securities

Stock-based compensation expense

Balance at June 30, 2025

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

2 unchanged sentences

(In thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities :

20 unchanged sentences

Net cash provided by (used in) financing activities

Net increase in cash and cash equivalents

Net (decrease) increase in cash and cash equivalents

Cash and cash equivalents at beginning of period

14 unchanged sentences

The Company’s condensed consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities in the ordinary course of business.

As of March 31, 2026, the Company had cash, cash equivalents and marketable securities of $ 190.8 million and an accumulated deficit of $ 987.6 million.

As of June 30, 2026, the Company had cash, cash equivalents and marketable securities of $ 170.6 million and an accumulated deficit of $ 1.0 billion.

Since inception, the Company has incurred net losses and negative cash flows from its operations.

12 unchanged sentences

Unaudited Interim Financial Information

The accompanying condensed consolidated balance sheet as of March 31, 2026, the condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2026 and 2025, the condensed consolidated statement of stockholders’ equity for the three months ended March 31, 2026 and 2025, and the condensed consolidated statements of cash flows for the three months ended March 31, 2026 and 2025 are unaudited.

The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual financial statements contained in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 26, 2026 (“Annual Report”) and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of March 31, 2026, the results of its operations and comprehensive loss for the three months ended March 31, 2026 and 2025, its changes in stockholders’ equity for the three months ended March 31, 2026 and 2025 and its cash flows for the three months ended March 31, 2026 and 2025.

The accompanying condensed consolidated balance sheet as of June 30, 2026, the condensed consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2026 and 2025, the condensed consolidated statement of stockholders’ equity for the three and six months ended June 30, 2026 and 2025, and the condensed consolidated statements of cash flows for the six months ended June 30, 2026 and 2025 are unaudited.

The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual financial statements contained in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 26, 2026 (“Annual Report”) and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of June 30, 2026, the results of its operations and comprehensive loss for the three and six months ended June 30, 2026 and 2025, its changes in stockholders’ equity for the three and six months ended June 30, 2026 and 2025 and its cash flows for the six months ended June 30, 2026 and 2025.

The condensed consolidated balance sheet data as of December 31, 2025 was derived from audited financial statements but does not include all disclosures required by generally accepted accounting principles in the United States (“GAAP”).

The financial data and other information disclosed in these notes related to the three months ended March 31, 2026 and 2025 are unaudited.

The results for the three months ended March 31, 2026 are not necessarily indicative of results to be expected for the year ending December 31, 2026, any other interim periods, or any future year or period.

The financial data and other information disclosed in these notes related to the three and six months ended June 30, 2026 and 2025 are unaudited.

The results for the three and six months ended June 30, 2026 are not necessarily indicative of results to be expected for the year ending December 31, 2026, any other interim periods, or any future year or period.

The unaudited interim financial statements of the Company included herein have been prepared pursuant to the rules and regulations of the SEC.

25 unchanged sentences

Significant assumptions used in the Company’s estimates include the probability of achieving regulatory milestones and commencing commercialization (collectively referred to as “probability of success”), which are based on an asset’s current stage of development and a review of existing clinical data.

Probability of success assumptions ranged between 21 % and 40 % at March 31, 2026.

Probability of success assumptions ranged between 21 % and 40 % at June 30, 2026.

Additionally, estimated future sales levels and the risk-adjusted discount rate applied to the potential payments are also significant assumptions used in calculating the fair value.

As of March 31, 2026, the discount rate ranged between 7.5 % and 9.3 % depending on the year of each potential payment.

As of June 30, 2026, the discount rate ranged between 7.5 % and 9.5 % depending on the year of each potential payment.

Revenue Recognition

15 unchanged sentences

Discontinued Operations

As of March 31, 2026 and December 31, 2025, the Company had $ 2.2 million in discontinued operations reported as other current liabilities in the Company’s condensed consolidated balance sheet, related to discontinued commercial products.

As of June 30, 2026 and December 31, 2025, the Company had $ 2.2 million in discontinued operations reported as other current liabilities in the Company’s condensed consolidated balance sheet, related to discontinued commercial products.

Recently Issued Accounting Pronouncements

11 unchanged sentences

The following tables present information about the fair value measurements of the Company’s financial assets and liabilities which are measured at fair value on a recurring and non-recurring basis, and indicate the level of the fair value hierarchy utilized to determine such fair values:

March 31, 2026

June 30, 2026

(In thousands)

9 unchanged sentences

Total liabilities

As of March 31, 2026, the Company’s cash equivalents consisted of money market funds, which were valued based upon Level 1 inputs, and treasury bills, which were valued based on Level 2 inputs.

As of December 31, 2025, the Company’s cash equivalents consisted of money market funds, which were valued based upon Level 1 inputs.

The Company’s marketable securities as of March 31, 2026 consisted of corporate debt securities, commercial paper, treasury bills, and U.S.

As of June 30, 2026 and December 31, 2025, the Company’s cash equivalents consisted of money market funds, which were valued based upon Level 1 inputs.

The Company’s marketable securities as of June 30, 2026 consisted of corporate debt securities, commercial paper, treasury bills, and U.S.

government debt securities, which were all valued based upon Level 2 inputs.

3 unchanged sentences

These quoted prices are obtained by the Company with the assistance of a third-party pricing service based on available trade, bid and other observable market data for identical securities.

During the three months ended March 31, 2026 and 2025, there were no transfers into or out of Level 3.

There was no change in the fair value of the contingent consideration liability during the three months ended March 31, 2026 due to offsetting impacts of the passage of time and changes in market rates.

As of March 31, 2026 and December 31, 2025, the fair value of the Company’s available-for-sale marketable securities by type of security was as follows:

March 31, 2026

During the three and six months ended June 30, 2026 and 2025, there were no transfers into or out of Level 3.

The $ 0.3 million increase in the fair value of the contingent consideration liability during the six months ended June 30, 2026 was primarily due to changes in estimated sales levels and the passage of time, partially offset by changes to market rates.

As of June 30, 2026 and December 31, 2025, the fair value of the Company’s available-for-sale marketable securities by type of security was as follows:

June 30, 2026

(In thousands)

27 unchanged sentences

Preferred Stock

As of March 31, 2026 and December 31, 2025, the Company’s amended and restated certificate of incorporation (the “Charter”) authorized the Company to issue 10,000,000 shares of undesignated preferred stock.

There were no shares of preferred stock outstanding as of March 31, 2026 or December 31, 2025.

As of March 31, 2026 and December 31, 2025, the Company’s Charter authorized the Company to issue 400,000,000 shares of $ 0.00001 par value common stock.

There were 139,652,849 and 120,499,433 shares of common stock issued and outstanding as of March 31, 2026 and December 31, 2025, respectively.

As of June 30, 2026 and December 31, 2025, the Company’s amended and restated certificate of incorporation (the “Charter”) authorized the Company to issue 10,000,000 shares of undesignated preferred stock.

There were no shares of preferred stock outstanding as of June 30, 2026 or December 31, 2025.

As of June 30, 2026 and December 31, 2025, the Company’s Charter authorized the Company to issue 400,000,000 shares of $ 0.00001 par value common stock.

There were 139,824,273 and 120,499,433 shares of common stock issued and outstanding as of June 30, 2026 and December 31, 2025, respectively.

Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders.

Common stockholders are entitled to receive dividends, as may be declared by the board of directors, if any, subject to any preferential dividend rights of any series of preferred stock that may be outstanding.

No dividends have been declared through March 31, 2026.

No dividends have been declared through June 30, 2026.

In November 2024, the Company issued warrants to Biosion, Inc.

4 unchanged sentences

The Warrants will terminate when exercised in full.

As of March 31, 2026, 3,000,000 Warrants were unexercised.

As of June 30, 2026, 3,000,000 Warrants were unexercised.

Sales of Common Stock Pursuant to At-The-Market Facility

8 unchanged sentences

The shares of common stock underlying any awards that expire, or are otherwise terminated, settled in cash or repurchased by the Company under the 2025 Plan will be added back to the shares of common stock available for issuance under the 2025 Plan.

As of March 31, 2026, 6,674,876 shares remained available for grant under the 2025 Plan.

The Company had 5,326,410 stock options and 1,852,140 RSUs outstanding as of March 31, 2026 under the 2025 Plan.

As of June 30, 2026, 6,754,427 shares remained available for grant under the 2025 Plan.

The Company had 5,651,560 stock options and 1,874,582 RSUs outstanding as of June 30, 2026 under the 2025 Plan.

2024 Inducement Plan

4 unchanged sentences

The shares of common stock underlying any awards that expire, or are otherwise terminated, settled in cash or repurchased by the Company under the 2024 Inducement Plan will be added back to the shares of common stock available for issuance under the 2024 Inducement Plan.

As of March 31, 2026, 493,500 shares remained available for grant under the 2024 Inducement Plan.

The Company had 1,172,000 stock options and 287,250 RSUs outstanding as of March 31, 2026 under the 2024 Inducement Plan.

As of June 30, 2026, 502,830 shares remained available for grant under the 2024 Inducement Plan.

The Company had 1,172,000 stock options and 250,875 RSUs outstanding as of June 30, 2026 under the 2024 Inducement Plan.

2017 Inducement Plan

1 unchanged sentence

The 2017 Inducement Plan is a non-stockholder approved stock plan adopted pursuant to the “inducement exception” provided under Nasdaq listing rules.

The Company had 323,500 stock options outstanding as of March 31, 2026 under the 2017 Inducement Plan.

The Company had 323,500 stock options outstanding as of June 30, 2026 under the 2017 Inducement Plan.

All shares of common stock that were eligible for issuance under the 2017 Inducement Plan after October 1, 2018, including any shares underlying any awards that expire or are otherwise terminated, reacquired to satisfy tax withholding obligations, settled in cash or repurchased by the Company in the future that would have been eligible for re-issuance under the 2017 Inducement Plan, were retired.

3 unchanged sentences

Upon the 2025 Plan becoming effective, no further grants can be made under the 2015 Plan.

The Company had 8,674,464 stock options and 1,458,796 RSUs outstanding as of March 31, 2026 under the 2015 Plan.

The Company had 8,245,932 stock options and 1,315,806 RSUs outstanding as of June 30, 2026 under the 2015 Plan.

Stock Option Valuation

The weighted average assumptions the Company used to estimate the fair value of stock options granted during the three months ended March 31, 2026 and 2025 were as follows:

Three Months Ended

The weighted average assumptions the Company used to estimate the fair value of stock options granted during the six months ended June 30, 2026 and 2025 were as follows:

Six Months Ended

Risk-free interest rate

5 unchanged sentences

Stock Options

The following table summarizes stock option activity for the three months ended March 31, 2026:

The following table summarizes stock option activity for the six months ended June 30, 2026:

(in thousands)

1 unchanged sentence

Forfeited and cancelled

Outstanding as of March 31, 2026

Options vested and expected to vest as of March 31, 2026

Options exercisable as of March 31, 2026

The weighted average grant date fair value of stock options granted during the three months ended March 31, 2026 was $ 2.45 per share.

Outstanding as of June 30, 2026

Options vested and expected to vest as of June 30, 2026

Options exercisable as of June 30, 2026

The weighted average grant date fair value of stock options granted during the six months ended June 30, 2026 was $ 2.50 per share.

Restricted Stock Units

The following table summarizes RSU activity for the three months ended March 31, 2026:

The following table summarizes RSU activity for the six months ended June 30, 2026:

(in thousands)

1 unchanged sentence

Forfeited and cancelled

Outstanding as of March 31, 2026

Outstanding as of June 30, 2026

Stock-Based Compensation

1 unchanged sentence

Three Months Ended

Six Months Ended

(In thousands)

3 unchanged sentences

Total stock-based compensation expense

As of March 31, 2026, the Company had unrecognized stock-based compensation expense for stock options and RSUs of $ 19.7 million and $ 10.4 million, respectively, which is each expected to be recognized over a weighted average period of 3.1 years.

As of June 30, 2026, the Company had unrecognized stock-based compensation expense for stock options and RSUs of $ 18.0 million and $ 9.3 million, respectively, which is expected to be recognized over weighted average periods of 3.0 years and 2.9 years, respectively.

Net Loss per Share

1 unchanged sentence

Three Months Ended

Six Months Ended

(In thousands, except for share and per share data)

3 unchanged sentences

Therefore, the weighted average number of shares of common stock outstanding used to calculate both basic and diluted net loss per share is the same.

For the three months ended March 31, 2026 and 2025, the basic and diluted weighted average shares outstanding included the shares of common stock issuable upon exercise of the outstanding Warrants, as there were no outstanding contingencies associated with the vesting or exercisability of the Warrants.

The following table presents potential shares of common stock excluded from the calculation of diluted net loss per share for the three months ended March 31, 2026 and 2025.

All share amounts presented in the table below represent the total number outstanding as of March 31, 2026 and 2025.

Three Months Ended

For the three and six months ended June 30, 2026 and 2025, the basic and diluted weighted average shares outstanding included the shares of common stock issuable upon exercise of the outstanding Warrants, as there were no outstanding contingencies associated with the vesting or exercisability of the Warrants.

The following table presents potential shares of common stock excluded from the calculation of diluted net loss per share for the six months ended June 30, 2026 and 2025.

All share amounts presented in the table below represent the total number outstanding as of June 30, 2026 and 2025.

Six Months Ended

Options to purchase common stock

15 unchanged sentences

Total operating lease liabilities

Amortization expense related to operating lease right-of-use assets and accretion of operating lease liabilities totaled $ 0.1 million for each of the three months ended March 31, 2026 and 2025.

Amortization expense related to operating lease right-of-use assets and accretion of operating lease liabilities totaled $ 0.2 million and $ 0.1 million for the three months ended June 30, 2026 and 2025, respectively, and $ 0.3 million for each of the six months ended June 30, 2026 and 2025.

Agreements Related to Intellectual Property

12 unchanged sentences

The Company has separate contractual obligations under which the Company has agreed to pay to third parties a portion of the consideration it may receive under the license agreement.

The Company recognized $ 0.2 million of licensing revenue during the three months ended March 31, 2026, a portion of which was payable to third parties.

The Company recognized $ 0.1 million and $ 0.3 million of licensing revenue during the three and six months ended June 30, 2026, respectively, a portion of which was payable to third parties.

License Agreement – Pediatrix Therapeutics, Inc.

11 unchanged sentences

In July 2024, the Company entered into a royalty purchase agreement with OCM IP Healthcare Portfolio LP, an investment vehicle for Ontario Municipal Employees Retirement System (“OMERS”), pursuant to which the Company sold to OMERS a portion of the Company’s future royalty payments and the remaining anniversary milestone payments associated with the license to Lilly (see Note 10).

The Company recognized $ 1.3 million and $ 1.0 million of licensing revenue during the three months ended March 31, 2026 and 2025, respectively, all of which was payable to third parties.

The Company recognized $ 1.1 million and $ 1.3 million of licensing revenue during the three months ended June 30, 2026 and 2025, respectively, and $ 2.4 million and $ 2.3 million during the six months ended June 30, 2026 and 2025, respectively, all of which was payable to third parties.

Asset Purchase Agreement – EPI Health, LLC

11 unchanged sentences

In addition to the payments described above, if the Company sells, licenses or transfers any of the intellectual property acquired from Confluence pursuant to the Confluence Agreement to a third party, the Company will be obligated to pay the former Confluence equity holders a portion of any consideration received from such sale, license or transfer in specified circumstances.

As of each of March 31, 2026 and December 31, 2025, the balance of the Company’s contingent consideration liability was $ 11.0 million (see Note 3).

As of June 30, 2026 and December 31, 2025, the balance of the Company’s contingent consideration liability was $ 11.3 million and $ 11.0 million, respectively (see Note 3).

Sale of Future Royalties

5 unchanged sentences

In particular, the Company does not have significant continuing involvement in the generation of the cash flows due to OMERS and there are no guaranteed rates of return to OMERS.

For the three months ended March 31, 2026 and 2025, the Company recognized $ 0.9 million and $ 0.8 million of non-cash royalty income, respectively.

As of March 31, 2026, the current and non-current portions of the remaining deferred income recognized under the units-of-revenue method were $ 4.0 million and $ 15.3 million, respectively.

The Company recognized $ 1.0 million of non-cash royalty income for each of the three months ended June 30, 2026 and 2025, and $ 1.8 million for each of the six months ended June 30, 2026 and 2025.

As of June 30, 2026, the current and non-current portions of the remaining deferred income recognized under the units-of-revenue method were $ 4.0 million and $ 14.3 million, respectively.

As of December 31, 2025, the current and non-current portions of the remaining deferred income recognized under the units-of-revenue method were $ 3.9 million and $ 16.2 million, respectively.

The Company did no t record a federal or state income tax benefit for losses incurred during the three months ended March 31, 2026 and 2025.

The Company did no t record a federal or state income tax benefit for losses incurred during the three and six months ended June 30, 2026 and 2025.

The Company concluded that it is more likely than not that its deferred tax assets will not be realized which resulted in recording a full valuation allowance during those periods.

6 unchanged sentences

Segment asset information regularly provided to the CODM is consistent with that reported on the consolidated balance sheet with particular emphasis on the Company’s available liquidity, including its cash, cash equivalents and marketable securities balances.

The following table presents the significant segment expenses and other segment items regularly reviewed by the CODM for the three months ended March 31, 2026 and 2025:

The following table presents the significant segment expenses and other segment items regularly reviewed by the CODM for the three and six months ended June 30, 2026 and 2025:

Three Months Ended

Six Months Ended

(In thousands)

14 unchanged sentences

(3) General and administrative expenses consist principally of salaries and related costs, including stock-based compensation, for personnel in executive, administrative, finance and legal functions, as well as facility-related costs, professional fees, business development costs, insurance costs, and travel expenses.

Subsequent Events

In July 2026, the Company sold an aggregate of 7.3 million shares of its common stock for gross proceeds of $ 40.2 million, pursuant to the amended and restated sales agreement with Leerink Partners LLC and Cantor Fitzgerald & Co., as sales agents, dated February 27, 2025.

The Company paid selling commissions and other fees of $ 1.2 million in connection with the sales.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements