What changed in this filing

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Item 9A. Controls and Procedures

2025-02-13 compared with 2024-02-15 · 209 added, 201 removed, 851 unchanged (33% of the section changed)

2 unchanged sentences

Our management, with the participation of our principal executive officer and our principal financial officer, evaluated, as of the end of the period covered by this Annual Report on Form 10-K, the effectiveness of our disclosure controls and procedures.

Based on that evaluation of our disclosure controls and procedures as of December 31, 2023, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures as of such date are effective at the reasonable assurance level.

The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Based on that evaluation of our disclosure controls and procedures as of December 31, 2024, our principal executive officer and

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principal financial officer concluded that our disclosure controls and procedures as of such date are effective at the reasonable assurance level.

The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

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The effectiveness of our internal control over financial reporting as of December 31, 2024, has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report, which is included herein.

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Changes in Internal Control over Financial Reporting

2 unchanged sentences

(b) Director and Officer Trading Arrangements

None of our directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the three months ended December 31, 2023.

A significant portion of the compensation of our directors and officers (as defined in Rule 16a-1(f) under the Exchange Act) is in the form of equity awards and, from time to time, directors and officers engage in open-market transactions with respect to the securities acquired pursuant to such equity awards or other of our securities, including to satisfy tax withholding obligations when equity awards vest or are exercised, and for diversification or other personal reasons.

Transactions in our securities by directors and officers are required to be made in accordance with our insider trading policy , which requires that the transactions be in accordance with applicable U.S.

federal securities laws that prohibit trading while in possession of material nonpublic information.

Rule 10b5-1 under the Exchange Act provides an affirmative defense that enables directors and officers to prearrange transactions in our securities in a manner that avoids concerns about initiating transactions while in possession of material nonpublic information.

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Each Rule 10b5-1 trading arrangement described below was entered into in accordance with our insider trading policy, and only permitted or permits transactions upon the expiration of the applicable mandatory cooling-off periods under Rule 10b5-1 of the Exchange Act.

Actual transactions are required to be disclosed publicly in Section 16 filings with the SEC.

The following table describes, for the fourth quarter of 2024, each trading arrangement for the sale or purchase of Company securities adopted or terminated by our directors and officers that is either (1) a contract, instruction or written plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) (a “Rule 10b5-1 trading arrangement”) or (2) a “non-Rule 10b5-1 trading arrangement” (as defined in Item 408(c) of Regulation S-K):

Action Taken (Date of Action)

Type of Trading Arrangement

Nature of Trading Arrangement

Duration of Trading Arrangement

Aggregate Number of Securities

Cecilia Jones ( Chief Financial Officer )

Adoption ( December 13, 2024 )

Rule 10b5-1 trading arrangement

Through and including March 17, 2026

Up to 24,779 shares

Tsveta Milanova ( Chief Commercial Officer )

Adoption ( December 13, 2024 )

Rule 10b5-1 trading arrangement

Through and including March 17, 2026

Up to 18,831 shares

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

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Consolidated Statements of Operations

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive Income (Loss)

Consolidated Statements of Stockholders’ Equity

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February 23, 2023 2.2

3.1 Restated Certificate of Incorp o r ation of the Registrant

3.1 Restated Certificate of Incorporation of the Registrant

July 30, 2013 3.1

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June 24, 2013

2013 Employee Stock Purchase Plan

June 24, 2013

Amended and Restated 2013 Employee Stock Purchase Plan

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10.5 Form of Indemnification Agreement between the Registrant and each of its Executive Officers and Directors

July 11, 2013

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10.6 Lease, dated as of September 15, 2014, between the Registrant and Forest City 88 Sidney, LLC

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(64 Sidney Street)

November 3, 2021

10.20 Sublease Agreement, dated July 27, 2021, between the Registrant and Prime Medicine, Inc.

(64 Sidney Street)

February 24, 2022

10.20 Sublease Agreement, dated April 14, 2023, between the Registrant and Watershed Informatics, Inc.

February 15, 2024

Letter Agreement, dated July 8, 2022, between the Registrant and Brian Goff

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001-36014 August 3, 2023 10.3

10.38# Form of Restricted Stock Unit Agreement (P erformance -Based) Under 2023 Stock Incentive Plan

10.37# Form of Restricted Stock Unit Agreement (Performance-Based) Under 2023 Stock Incentive Plan

10-Q 001-36014 August 3, 2023 10.4

10.38** Purchase and Sale Agreement, dated May 24, 2024, by and between the Registrant and Royalty Pharma Investments 2019 ICAV

10-Q 001-36014 August 1, 2024 10.1

19.1 Insider Trading Policy

Subsidiaries of the Registrant

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§1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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Certification of principal financial officer pursuant to 18 U.S.C.

1 unchanged sentence

97.1 Dodd-Frank Compensation Recovery Policy

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February 15, 2024

XBRL Instance Document

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Consolidated Statements of Operations

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive Income (Loss)

Consolidated Statements of Stockholders’ Equity

69 unchanged sentences

Accrued expenses 46,861 43,167

Income taxes payable 871 —

Operating lease liabilities 16,781 15,008

33 unchanged sentences

Gain on sale of contingent payments 889,136 — 127,853

Milestone payment from gain on sale of oncology business 200,000 — —

Royalty income from gain on sale of oncology business — — 9,851

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Other income, net 6,487 6,055 6,749

Net loss from continuing operations ( 352,088 ) ( 231,801 ) ( 356,510 )

Net income from discontinued operations, net of tax — — 1,961,225

Net (loss) income $ ( 352,088 ) $ ( 231,801 ) $ 1,604,715

Net loss from continuing operations per share - basic and diluted $ ( 6.33 ) $ ( 4.23 ) $ ( 5.90 )

Net income from discontinued operations per share - basic and diluted $ — $ — $ 32.45

Net (loss) income per share - basic and diluted $ ( 6.33 ) $ ( 4.23 ) $ 26.55

Weighted-average number of common shares used in computing net loss per share from continuing operations, net income per share from discontinued operations and net (loss) income per share – basic and diluted 55,651,487 54,789,435 60,447,346

Net income (loss) before taxes 717,969 ( 352,088 ) ( 231,801 )

Income tax expense 44,244 — —

Net income (loss) $ 673,725 $ ( 352,088 ) $ ( 231,801 )

Net income (loss) per share - basic $ 11.86 $ ( 6.33 ) $ ( 4.23 )

Net income (loss) per share - diluted $ 11.64 $ ( 6.33 ) $ ( 4.23 )

Weighted-average number of common shares used in computing net income (loss) per share – basic 56,807,415 55,651,487 54,789,435

Weighted-average number of common shares used in computing net income (loss) per share – diluted 57,889,255 55,651,487 54,789,435

See accompanying Notes to Consolidated Financial Statements.

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Agios Pharmaceuticals, Inc.

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive Income (Loss)

(In thousands) Years Ended December 31:

2024 2023 2022

Net (loss) income $ ( 352,088 ) $ ( 231,801 ) $ 1,604,715

Net income (loss) $ 673,725 $ ( 352,088 ) $ ( 231,801 )

Other comprehensive (loss) income

Unrealized gain (loss) on available-for-sale securities 12,094 ( 11,337 ) ( 1,303 )

Comprehensive (loss) income $ ( 339,994 ) $ ( 243,138 ) $ 1,603,412

Unrealized (loss) gain on available-for-sale securities ( 1,077 ) 12,094 ( 11,337 )

Comprehensive income (loss) $ 672,648 $ ( 339,994 ) $ ( 243,138 )

See accompanying Notes to Consolidated Financial Statements.

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Unrealized loss on available-for-sale securities — — — ( 11,337 ) — — — ( 11,337 )

Net income — — — — 1,604,715 — — 1,604,715

Net loss — — — — ( 231,801 ) — — ( 231,801 )

Stock-based compensation expense — — 49,296 — — — — 49,296

Common stock issued under stock incentive plan and ESPP 705,487 — 2,681 — — — — 2,681

Repurchase of common stock — — — — — ( 16,216,411 ) ( 802,486 ) ( 802,486 )

Disposition of oncology business — — 745 — — — — 745

Balance at December 31, 2022 71,256,118 $ 71 $ 2,386,325 $ ( 12,535 ) $ ( 470,561 ) ( 16,216,411 ) $ ( 802,486 ) $ 1,100,814

Unrealized loss on available-for-sale securities — — — ( 11,337 ) — — — ( 11,337 )

Unrealized gain on available-for-sale securities — — — 12,094 — — — 12,094

Net loss — — — — ( 352,088 ) — — ( 352,088 )

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Balance at December 31, 2023 72,161,489 $ 72 $ 2,436,523 $ ( 441 ) $ ( 822,649 ) ( 16,216,411 ) $ ( 802,486 ) $ 811,019

Unrealized gain on available-for-sale securities — — — 12,094 — — — 12,094

Net loss — — — — ( 352,088 ) — — ( 352,088 )

Unrealized loss on available-for-sale securities — — — ( 1,077 ) — — — ( 1,077 )

Net income — — — — 673,725 — — 673,725

Stock-based compensation expense — — 42,847 — — — — 42,847

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Operating activities

Net (loss) income $ ( 352,088 ) $ ( 231,801 ) $ 1,604,715

Net income from discontinued operations — — 1,961,225

Net loss from continuing operations ( 352,088 ) ( 231,801 ) ( 356,510 )

Adjustments to reconcile net loss to net cash used in operating activities:

Net income (loss) $ 673,725 $ ( 352,088 ) $ ( 231,801 )

Adjustments to reconcile net income (loss) to net cash used in operating activities:

Depreciation and amortization 5,653 6,623 8,564

Stock-based compensation expense 42,847 44,766 49,296

Net (accretion of discount) amortization of premium on marketable securities ( 5,051 ) ( 1,198 ) 6,949

Net accretion of discount on marketable securities ( 14,486 ) ( 5,051 ) ( 1,198 )

Gain on sale of contingent payments ( 889,136 ) — ( 127,853 )

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Realized gain on investments ( 167 ) ( 28 ) —

Milestone payment from gain on sale of oncology business ( 200,000 ) — —

Changes in operating assets and liabilities:

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Accrued expenses 3,694 12,817 ( 1,617 )

Income taxes payable 871 — —

Operating lease liabilities ( 15,008 ) ( 13,663 ) ( 10,828 )

Other liabilities ( 276 ) ( 2,123 ) 3,003

Net cash used in operating activities - continuing operations ( 296,062 ) ( 309,478 ) ( 314,086 )

Net cash used in operating activities - discontinued operations — — ( 93,234 )

Net cash used in operating activities ( 389,841 ) ( 296,062 ) ( 309,478 )

3 unchanged sentences

Proceeds from sale of contingent payments 889,136 — 131,784

Proceeds from milestone payment from gain on sale of oncology business 200,000 — —

Payments associated with license agreement — ( 17,500 ) —

1 unchanged sentence

Proceeds from sale of equipment 40 1,325 964

Net cash provided by (used in) investing activities - continuing operations 239,575 243,261 ( 554,158 )

Net cash provided by investing activities - discontinued operations — — 1,802,936

Net cash provided by investing activities 363,441 239,575 243,261

1 unchanged sentence

Payments on financing lease obligations — — ( 331 )

Purchase of treasury stock — — ( 802,486 )

Net proceeds from stock option exercises and employee stock purchase plan 14,442 5,433 2,681

Net cash provided by (used in) financing activities 5,433 2,350 ( 765,768 )

Net cash provided by financing activities 14,442 5,433 2,350

Net change in cash and cash equivalents ( 11,958 ) ( 51,054 ) ( 63,867 )

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Net cash taxes paid $ 43,150 $ 1,569 $ —

Financing lease liabilities arising from obtaining financing lease assets $ — $ — $ 511

See accompanying Notes to Consolidated Financial Statements.

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The lead product candidate in our portfolio, PYRUKYND® (mitapivat), is an activator of both wild-type and mutant pyruvate kinase, or PK, enzymes for the potential treatment of hemolytic anemias.

In February 2022, the U.S.

Food and Drug Administration, or FDA, approved PYRUKYND® for the treatment of hemolytic anemia in adults with PK deficiency in the United States.

In November 2022, we received marketing authorization from the European Commission for PYRUKYND® for the treatment of PK deficiency in adult patients in the European Union, or EU.

In December 2022, we received marketing authorization in Great Britain for PYRUKYND® for the treatment of PK deficiency in adult patients under the European Commission Decision Reliance Procedure.

In addition, we are currently evaluating PYRUKYND® in clinical trials for the treatment of thalassemia, sickle cell disease, or SCD, and in pediatric patients with PK deficiency.

We are also developing (i) AG-946, a novel PK activator, for the potential treatment of lower-risk myelodysplastic syndrome, or LR MDS, and hemolytic anemias, and (ii) AG-181, our phenylalanine hydroxylase, or PAH, stabilizer for the potential treatment of phenylketonuria, or PKU.

In addition to the aforementioned development programs, in July 2023 we entered into a license agreement with Alnylam Pharmaceuticals, Inc., or Alnylam for the development and commercialization of products containing or comprised of an siRNA preclinical development candidate discovered by Alnylam and targeting the transmembrane serine protease 6, or TMPRSS6, gene and we intend to pursue development of a licensed product for the potential disease-modifying treatment of patients with polycythemia vera, or PV, a rare blood disorder.

PYRUKYND® is approved for use by the U.S.

Food and Drug Administration, or FDA, for the treatment of hemolytic anemia in adults with PK deficiency in the United States and by the European Commission for the treatment of PK deficiency in adult patients in the European Union, or EU.

Additionally, we received marketing authorization in Great Britain for PYRUKYND® for the treatment of PK deficiency in adult patients under the European Commission Decision Reliance Procedure.

In December 2024, we announced that we submitted a supplemental new drug application, or sNDA, to the FDA for PYRUKYND® for the treatment of adult patients with non-transfusion dependent and transfusion-dependent alpha- or beta-thalassemia, which was accepted with standard review by the FDA and granted a Prescription Drug User Fee Act, or PDUFA, goal date of September 7, 2025.

Also in December 2024, we announced that we submitted a marketing authorization application, or MAA, to the European Medicines Agency, or EMA, and regulatory applications to the Kingdom of Saudi Arabia and United Arab Emirates health authorities for PYRUKYND® for the treatment of adult patients with non-transfusion dependent and transfusion-dependent alpha- or beta-thalassemia.

In addition, we are currently evaluating PYRUKYND® in Phase 3 clinical trials for the treatment of sickle cell disease, or SCD, and in pediatric patients with PK deficiency.

We are also developing (i) tebapivat, a novel PK activator, for the potential treatment of lower-risk myelodysplastic syndromes, or LR MDS, and hemolytic anemias;

(ii) AG-181, our phenylalanine hydroxylase, or PAH, stabilizer for the potential treatment of phenylketonuria, or PKU;

and (iii) AG-236, an siRNA in-licensed from Alnylam Pharmaceuticals, Inc., or Alnylam, targeting the transmembrane serine protease 6, or TMPRSS6 gene for the potential treatment of polycythemia vera, or PV.

We are subject to risks common to companies in our industry including, but not limited to, uncertainties relating to conducting preclinical and clinical research and development, the manufacture and supply of products for clinical and commercial use, obtaining and maintaining regulatory approvals and pricing and reimbursement for our products, market acceptance, managing global growth and operating expenses, availability of additional capital, competition, obtaining and enforcing patents, stock price volatility, dependence on collaborative relationships and third-party service providers, dependence on key personnel, potential litigation, potential product liability claims and potential government investigations.

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On July 28, 2023, we entered into a license agreement with Alnylam under which we acquired the rights to develop and commercialize Alnylam’s novel preclinical siRNA targeting the TMPRSS6 gene, as a potential disease-modifying treatment for patients with PV.

Because the acquired assets do not meet the definition of a business in accordance with ASC 805, Business Combinations, we will account for the agreement as an asset acquisition.

In accordance with the license agreement, in the twelve months ended December 31, 2023, we made an up-front payment to Alnylam and recognized in-process research and development of $ 17.5 million which was recorded in research and development expense within our Consolidated Statements of Operations and classified as investing activities within our Consolidated Statements of Cash Flows.

We will also pay Alnylam for certain expenses associated with the development of TMPRSS6 and these will be recorded in our Consolidated Statements of Operations as incurred.

Additionally, we are responsible to pay up to $ 130.0 million in potential development and regulatory milestones, in addition to sales milestones as well as tiered royalties on annual net sales, if any, of licensed products, which may be subject to specified reductions and offsets.

Because the acquired assets do not meet the definition of a business in accordance with Accounting Standards Codification, or ASC, 805, Business Combinations , we accounted for the agreement as an asset acquisition.

In accordance with the license agreement, in the year ended December 31, 2023, we made an up-front payment to Alnylam and recognized in-process research and development of $ 17.5 million which was recorded in research and development expense within our consolidated statements of operations and classified as investing activities within our consolidated statements of cash flows.

We will also pay Alnylam for certain expenses associated with the development of AG-236, an siRNA targeting the TMPRSS6 gene, and these will be recorded in our consolidated statements of operations as incurred.

Additionally, we are responsible to pay up to $ 130.0 million in potential development and regulatory milestones, in addition to sales milestones as

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well as tiered royalties on annual net sales, if any, of licensed products, which may be subject to specified reductions and offsets.

Sale of Oncology Business to Servier and Sale of Contingent Payments

On March 31, 2021, we completed the sale of our oncology business to Servier Pharmaceuticals, LLC, or Servier, which represented a discontinued operation.

The transaction included the sale of our oncology business, including TIBSOVO®, our clinical-stage product candidates vorasidenib, AG-270 and AG-636, and our oncology research programs for a payment of approximately $ 1.8 billion in cash at the closing, subject to certain adjustments, and a payment of $ 200.0 million in cash, if, prior to January 1, 2027, vorasidenib is granted new drug application, or NDA, approval from the FDA with an approved label that permits vorasidenib’s use as a single agent for the adjuvant treatment of patients with Grade 2 glioma that have an isocitrate dehydrogenase 1 or 2 mutation (and, to the extent required by such approval, the vorasidenib companion diagnostic test is granted an FDA premarket approval), as well as a royalty of 5 % of U.S.

The transaction included the sale of our oncology business, including TIBSOVO®, our clinical-stage product candidates vorasidenib, AG-270 and AG-636, and our oncology research programs for a payment of approximately $ 1.8 billion in cash at the closing, subject to certain adjustments, and a payment of $ 200.0 million in cash, if, prior to January 1, 2027, vorasidenib is granted new drug application approval from the FDA with an approved label that permits vorasidenib’s use as a single agent for the adjuvant treatment of patients with Grade 2 glioma that have an isocitrate dehydrogenase, or IDH, 1 or 2 mutation (and, to the extent required by such approval, the vorasidenib companion diagnostic test is granted an FDA premarket approval), or the Vorasidenib Milestone Payment, as well as a royalty of 5 % of U.S.

net sales of TIBSOVO® from the close of the transaction through loss of exclusivity, and a royalty of 15 % of U.S.

net sales of vorasidenib from the first commercial sale of vorasidenib through loss of exclusivity.

Servier also acquired our co-commercialization rights for Bristol Myers Squibb’s IDHIFA® and the right to receive a $ 25.0 million potential milestone payment under our prior collaboration agreement with Celgene Corporation, or Celgene, and following the sale Servier will conduct certain clinical development activities within the IDHIFA® development program.

net sales of vorasidenib from the first commercial sale of vorasidenib through loss of exclusivity, or the Vorasidenib Royalty Rights.

The Vorasidenib Milestone Payment, Vorasidenib Royalty Rights and royalty payments related to TIBSOVO® are referred to as contingent payments and recognized as income when realizable.

Servier also acquired our co-commercialization rights for Bristol Myers Squibb’s IDHIFA® and the right to receive a $ 25.0 million potential milestone payment under our prior collaboration agreement with Celgene Corporation, or Celgene, and following the sale Servier has agreed to conduct certain clinical development activities within the IDHIFA® development program.

In October 2022, we sold our rights to future contingent payments associated with the royalty of 5 % of U.S.

net sales of TIBSOVO® from the close of the transaction through the loss of exclusivity to entities affiliated with Sagard Healthcare Partners, or Sagard, and recognized income of $ 127.9 million within the gain on sale of contingent payments line item in our consolidated statements of operations for the year ended December 31, 2023.

We retain our rights to the potential milestone payment and royalties from Servier if a new drug application for vorasidenib is approved by the FDA.

We recorded income from royalties of $ 9.9 million and $ 6.6 million on U.S.

net sales of TIBSOVO® by Servier in the royalty income from gain on sale of oncology business line item within the consolidated statements of operation s for the years ended December 31, 2022 and December 31, 2021, respectively.

Reclassifications

Certain amounts in prior periods have been reclassified to reflect the impact of the discontinued operations treatment of the oncology business in order to conform to the current period presentation.

As of December 31, 2023, we had cash, cash equivalents and marketable securities of $ 806.4 million.

In August 2024, the FDA approved vorasidenib for adult and pediatric patients 12 years and older with Grade 2 astrocytoma or oligodendroglioma with a susceptible IDH1 or IDH2 mutation, following surgery including biopsy, sub-total resection, or gross total resection.

In September 2024, we received the Vorasidenib Milestone Payment from Servier and recognized income of $ 200.0 million within the milestone payment from gain on sale of oncology business line item in our consolidated statements of operations for the year ended December 31, 2024.

In May 2024, we entered into a purchase and sale agreement to sell the Vorasidenib Royalty Rights to Royalty Pharma Investments 2019 ICAV, or Royalty Pharma, for $ 905.0 million in cash, or the Upfront Payment.

The sale was contingent upon FDA approval of vorasidenib and other customary closing conditions.

Upon consummation of the sale in August 2024, Royalty Pharma acquired 100 % of the Vorasidenib Royalty Rights payments made by Servier on account of up to $ 1.0 billion in U.S.

net sales for each calendar year.

In addition, any such Vorasidenib Royalty Rights payments made by Servier on account of U.S.

net sales in each calendar year in excess of $ 1.0 billion will be split, with Royalty Pharma having the rights to a 12 % earn-out on those excess payments and Agios retaining the rights to a 3 % earn-out on those excess payments, or the Retained Earn-Out Rights.

As a result of the sale, we recognized income of $ 889.1 million ($ 905.0 million net of fees of $ 15.9 million) within the gain on sale of contingent payments line item in our consolidated statements of operations for the year ended December 31, 2024.

Royalty income related to the Retained Earn-Out Rights, if any, will be recognized in the period when realizable.

We recorded income from royalties of $ 9.9 million on U.S.

net sales of TIBSOVO® by Servier in the royalty income from gain on sale of oncology business line item within the consolidated statements of operation s for the year ended December 31, 2022.

As of December 31, 2024, we had cash, cash equivalents and marketable securities of $ 1.5 billion.

Although we have incurred recurring losses and expect to continue to incur losses for the foreseeable future, we expect our cash, cash equivalents and marketable securities to be sufficient to fund current operations for at least the next twelve months from the issuance of the financial statements.

If we are unable to raise additional funds through equity or debt financings, we may be required to delay, limit, reduce or terminate product development or future commercialization efforts or grant rights to develop and market products or product candidates that we would otherwise prefer to develop and market ourselves.

On April 30, 2020, we entered into an at-the-market sales agreement, or the 2020 sales agreement, with Cowen & Company LLC, or Cowen, pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $ 250.0 million through Cowen pursuant to a universal shelf registration statement on Form S-3 filed with the SEC on April 30, 2020.

As of December 31, 2022, $ 250.0 million in common stock remained available for future issuance under the 2020 sales agreement.

On February 15, 2023, we delivered written notice to Cowen that we were terminating the 2020 sales agreement, effective on February 22, 2023.

As of the termination of the 2020 sales agreement, we had not sold any shares of our common stock under the 2020 sales agreement.

Summary of Significant Accounting Policies

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generally accepted accounting principles, or U.S.

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Use of estimates

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We base our estimates on historical experience and on various other assumptions that we believe are reasonable, the results of which form the basis for making judgments about the carrying values of assets, liabilities and equity and the amount of revenues and expenses.

The full extent to

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which the recent COVID-19 pandemic, or other pandemics or public health emergencies, may in the future directly or indirectly impact our business, results of operations and financial condition, including expenses, reserves and allowances, clinical trials, research and development costs and employee-related amounts, will depend on future developments that are highly uncertain.

Cash and cash equivalents

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Revenue recognition

Under Accounting Standards Codification 606, Revenue from Contracts with Customers , or ASC 606, revenue is recognized when the customer obtains control of promised goods or services, in an amount that reflects the consideration that we expect to receive in exchange for those goods or services.

Under ASC 606, Revenue from Contracts with Customers , or ASC 606, revenue is recognized when the customer obtains control of promised goods or services, in an amount that reflects the consideration that we expect to receive in exchange for those goods or services.

To determine revenue recognition for arrangements that have been determined to be within the scope of ASC 606, we perform the following five steps:

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Revenues from product sales are recorded at the net sales price, or transaction price, which includes estimates of variable consideration for which reserves are established and result from contractual adjustments, government rebates, returns and other allowances that are offered within the contracts with our Customers, healthcare providers, payors and other indirect customers relating to the sale of our products.

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Contractual Adjustments .

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In addition, we receive sales order management, data and distribution services from certain Customers.

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Chargebacks and discounts represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to Customers who directly purchase the product from us.

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Cost of sales consists primarily of manufacturing costs for sales of PYRUKYND®.

Based on our policy to expense costs associated with the manufacturing of our products prior to regulatory approval, certain of the manufacturing costs associated with product shipments of PYRUKYND® recorded during the twelve months ended December 31, 2023 and 2022 were expensed prior to February 17, 2022 and, therefore, are not included in costs of sales during the twelve months ended December 31, 2023 and 2022.

Based on our policy to expense costs associated with the manufacturing of our products prior to regulatory approval, certain of the manufacturing costs associated with product shipments of PYRUKYND® recorded during the years ended December 31, 2024, 2023 and 2022 were expensed prior to February 17, 2022 and, therefore, are not included in costs of sales during the years ended December 31, 2024, 2023 and 2022.

The amounts excluded from cost of sales were not significant during the years ended December 31, 2024, 2023 and 2022.

Inventories are reviewed periodically to identify excess or obsolete inventory based on projected sales activity as well as product shelf-life.

Expired inventory is disposed of, and the related costs are recognized as cost of sales in our consolidated statements of operations, when, based on the expiry date, we do not believe we are able to sell the inventory.

We have not reserved for excess or obsolete inventory during the years ended December 31, 2024 and 2023.

Marketable securities

Marketable securities at December 31, 2024 and 2023 consisted of investments in U.S.

Treasuries, government securities and corporate debt securities.

Treasuries, government securities, corporate debt securities and certificates of deposit.

We determine the appropriate classification of the securities at the time they are acquired and evaluate the appropriateness of such classifications at each balance sheet date.

1 unchanged sentence

Marketable securities are recorded at fair value.

Unrealized gains and losses are included as a component of accumulated other comprehensive (loss) income in the consolidated balance sheets and statements of stockholders’ equity and a component of total comprehensive (loss) income in the consolidated statements of comprehensive (loss) income, until realized.

Realized gains and losses are included in investment income on a specific-identification basis.

Unrealized gains and losses are included as a component of accumulated other comprehensive (loss) income in the consolidated balance sheets and statements of stockholders’ equity and a component of total comprehensive income (loss) in the consolidated statements of comprehensive income (loss), until realized.

Realized gains and losses are included in interest income, net on a specific-identification basis.

At December 31, 2024 and 2023, we held both current and non-current investments.

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Evidence considered in this assessment includes reasons for the impairment, compliance with our investment policy, the severity of the impairment, collectability of the security, and any adverse conditions specifically related to the security, an industry, or geographic area.

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Fair value measurements

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Level 2 – Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability.

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Level 3 – Unobservable inputs that reflect our own assumptions about the assumptions market participants would use in pricing the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date.

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Potential impairment is assessed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered.

Recoverability of these assets is assessed based on the undiscounted expected future cash flows from the assets, considering a number of factors, including past operating results, budgets and economic projections, market trends and product development cycles.

Recoverability of these assets is assessed based on the undiscounted expected future cash flows from the assets, considering a number of factors, including past operating results, budgets and

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economic projections, market trends and product development cycles.

If impairments are identified, assets are written down to their estimated fair value.

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An arrangement is determined to contain a lease if the contract conveys the right to control the use of an identified property or equipment for a period of time in exchange for consideration.

If we can benefit from the various underlying assets of a lease on their own or together with other resources that are readily available, or if the various underlying assets are neither highly dependent on nor highly interrelated with other underlying assets in the

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arrangement, they are considered to be a separate lease component.

In the event multiple underlying assets are identified, the lease consideration is allocated to the various components based on each of the component’s relative fair value.

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Research and development costs, including those accrued as of each balance sheet date, are expensed as incurred.

These costs include salaries and personnel-related costs, consulting fees, fees paid for contract research services, fees paid to contract research organizations, or CROs, and other third parties in connection with clinical trials and preclinical development activities, fees paid to investigative sites in connection with clinical studies, the costs associated with the product manufacturing, development, and distribution of clinical supplies, the costs of laboratory equipment and facilities, and other external costs.

These costs include salaries and personnel-related costs, consulting fees, fees paid for contract research services, fees paid to contract research organizations, or CROs, and other third parties in connection with clinical trials and preclinical development activities, fees paid to investigative sites in connection with clinical trials, the costs associated with the product manufacturing, development, and distribution of clinical supplies, the costs of laboratory equipment and facilities, and other external costs.

Nonrefundable advance payments for goods or services to be received in the future for use in research and development activities are deferred and capitalized.

Additionally, there may be instances in which payments made to our vendors will exceed the level of services provided, and result in a prepayment of the research and development expense.

Additionally, there may be instances as of a given balance sheet date in which payments made to our vendors will exceed the level of services provided, and result in a prepayment of the research and development expense.

The capitalized amounts are expensed as the related goods are delivered or the services are performed.

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We determine our deferred tax assets and liabilities based on differences between the financial reporting and tax bases of assets and liabilities, which are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.

Valuation allowances are provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Valuation allowances are

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provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

We also account for uncertain tax positions in accordance with the provisions of ASC 740.

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The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances.

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Comprehensive (loss) income

Comprehensive (loss) income is defined as the change in equity of a business enterprise during a period from transactions, and other events and circumstances, and currently consists of net loss and unrealized gains and losses on available-for-sale securities.

Accumulated other comprehensive (loss) income consists entirely of unrealized gains and losses from available-for-sale securities as of December 31, 2023 and 2022.

Net (loss) income per share

Basic net (loss) income per share is calculated by dividing net (loss) income by the weighted-average shares outstanding during the period, without consideration for common stock equivalents.

Diluted net (loss) income per share is calculated by adjusting weighted-average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury-stock method.

For purposes of the dilutive net (loss) income per share calculation, stock options, restricted stock units, or RSUs, performance-based stock units, or PSUs, and market-based stock units, or MSUs, for which the performance and market vesting conditions, respectively, have been deemed probable, and employee stock purchase plan shares are considered to be common stock equivalents but are excluded from the calculation of diluted net (loss) income per share as their effect would be anti-dilutive.

Comprehensive income (loss)

Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions, and other events and circumstances, and currently consists of net income (loss) and unrealized gains and losses on available-for-sale securities.

Accumulated other comprehensive loss consists entirely of unrealized gains and losses from available-for-sale securities as of December 31, 2024 and 2023.

Net income (loss) per share

Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted-average shares outstanding during the period, without consideration for common stock equivalents.

Diluted net income (loss) per share is calculated by adjusting the weighted-average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury stock method.

For purposes of the dilutive net income (loss) per share calculation, stock options, restricted stock units, or RSUs, and performance-based stock units, or PSUs, for which the performance and market vesting conditions, respectively, have been deemed probable, and 2013 Employee Stock Purchase Plan, or 2013 ESPP, shares are considered to be common stock equivalents, while PSUs with performance and market vesting conditions, respectively, that were not deemed probable as of December 31, 2024 are not considered to be common stock equivalents.

We utilize the control number concept in the computation of diluted earnings per share to determine whether potential common stock equivalents are dilutive.

The control number used is loss from continuing operations.

The control number used is net income (loss) from continuing operations.

The control number concept requires that the same number of potentially dilutive securities applied in computing diluted earnings per share from continuing operations be applied to all other categories of income or loss, regardless of their anti-dilutive effect on such categories.

Since we had a net loss from continuing operations for all periods presented, no dilutive effect has been recognized in the calculation of income (loss) from discontinued operations per share or net (loss) income per share.

Segment and geographic information

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker or decision-making group in making decisions on how to allocate resources and assess performance.

Our chief operating decision maker is the chief executive officer.

Our chief operating decision maker and we view our operations and manage our business as one operating segment.

Discontinued operations

We accounted for the sale of our oncology business in the first quarter of 2021 in accordance with ASC 205, Discontinued Operations and Accounting Standards Update, or ASU, No.

2014-08, Reporting of Discontinued Operations and Disclosures of Disposals of Components of an Entity .

We followed the held-for-sale criteria as defined in ASC 360, Property, Plant and Equipment, and ASC 205.

ASC 205 requires that a component of an entity that has been disposed of or is classified as held for sale and has operations and cash flows that can be clearly distinguished from the rest of the entity be reported as assets held for sale and discontinued operations.

In the period a component of an entity has been disposed of or classified as held for sale, the results of operations for the periods presented are reclassified into separate line items in the consolidated statements of operations.

Assets and liabilities are also reclassified into separate line items on the related consolidated balance sheets for the periods presented.

The statements of cash flows for the periods presented are also reclassified to reflect the results of discontinued operations as separate line items.

ASU 2014-08 requires that only a disposal of a component of an entity, or a group of components of an entity, that represents a strategic shift that has, or will have, a major effect on the reporting entity’s operations and financial results be reported in the financial statements as discontinued operations.

ASU 2014-08 also provides guidance on the financial statement presentations and disclosures of discontinued operations.

Due to the sale of our oncology business during the first quarter of 2021, in accordance with ASC 205, we have classified the results of the oncology business as discontinued operations in our consolidated statements of operations and cash flows for all periods presented, and refer to Note 15, Discontinued Operations .

All amounts included in the notes to the consolidated financial statements relate to continuing operations unless otherwise noted.

Since we had a net loss for the years ended December 31, 2023 and 2022, no dilutive effect was recognized in the calculation of loss per share and basic and diluted net loss per share was the same for those periods.

Segment information

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or CODM, or decision-making group in making decisions on how to allocate resources and assess performance.

Our CODM is our chief executive officer, or CEO.

Our CEO views our operations and manages our business as one operating segment, which derives its revenues from the development and commercialization of therapies for patients with rare diseases.

Treasury stock

Treasury stock purchases are accounted for under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock.

Repurchased shares are held as treasury stock until they are retired or re-issued.

Treasury stock purchases are accounted for under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock.

Repurchases of our common stock are accounted for as of the settlement date.

There were no repurchases, retirements or re-issuances of treasury stock during the year ended December 31, 2024.

Recent accounting pronouncements

Accounting standards that have been issued by the Financial Accounting Standards Board or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our financial statements upon adoption.

In December 2023, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2023-09, Income Taxes (Topics 740):

Improvements to Income Tax Disclosures , to expand the disclosure requirements for income taxes.

Upon adoption, companies will be required to disclose additional specified categories in the rate reconciliation.

Companies will also be required to disclose the amount of income taxes paid disaggregated by jurisdiction, among other disclosure requirements.

The standard is effective for annual periods beginning after December 15, 2024, and can be applied either prospectively or retrospectively.

We plan to adopt the standard in our 2025 annual period and are currently assessing its effect on our financial statement disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses , to improve disclosures around an entity’s expenses.

Upon adoption, companies will be required to disclose in the notes to the financial statements a disaggregation of certain expense categories included within the expense captions on the face of the income statement.

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standard is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted, and can be applied either prospectively or retrospectively.

We plan to adopt the standard in our 2027 annual period and are currently assessing its effect the standard on our financial statement disclosures.

Subsequent events

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Fair Value Measurements

The following table summarizes our cash equivalents and marketable securities measured at fair value and by level (as described in Note 2, Su mmary of Significant Accounting Policies ) on a recurring basis as of December 31, 2023:

The following table summarizes our cash equivalents and marketable securities measured at fair value and by level (as described in Note 2, Summary of Significant Accounting Policies ) on a recurring basis as of December 31, 2024:

(In thousands) Level 1 Level 2 Level 3 Total

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Marketable securities:

Certificates of deposit — 10,385 — 10,385

Treasuries — 281,119 — 281,119

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Gains Unrealized

Certificates of deposit $ 10,374 $ 11 $ — $ 10,385

Treasuries 173,465 153 ( 27 ) 173,591

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Our building leases are comprised of office and laboratory space under non-cancelable operating leases.

These lease agreements have remaining lease terms of four years and contain various clauses for renewal at our option.

These lease agreements have remaining lease terms of three years and contain various clauses for renewal at our option.

The renewal options were not included in the calculation of the operating lease assets and the operating lease liabilities as the renewal options are not reasonably certain of being exercised.

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We provided our landlord a security deposit of $ 2.9 million as security for our leases, which is included within other non-current assets on our consolidated balance sheet.

In August 2021, we entered into a long-term sublease agreement for 13,000 square feet of the office space at 38 Sidney Street, Cambridge, Massachusetts, with the term of the lease running through December 2024.

In August 2021, we entered into a long-term sublease agreement for 13,000 square feet of the office space at 38 Sidney Street, Cambridge, Massachusetts, which expired on December 31, 2024.

In April 2022, we entered into a long-term sublease agreement for 27,000 square feet of the office space at 64 Sidney Street, Cambridge, Massachusetts, with the term of the lease running through April 2025.

At the end of the initial sublease periods, the subtenant has the option to extend the leases for one additional 6 -month period.

At the end of the initial sublease period, the subtenant has the option to extend the lease for one additional 6 -month period.

In May 2023, we entered into a long-term sublease agreement for 7,407 square feet of office space on the first floor of 64 Sidney Street, Cambridge, Massachusetts, with the term of the lease running through April 2025.

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We recorded operating sublease income of $ 6.4 million and $ 6.1 million for the years ended December 31, 2024 and December 31, 2023, respectively, in other income, net in the consolidated statements of operations.

We received a security deposit from our sublessee of approximately $ 1.2 million which is recorded within other non-current assets on our consolidated balance sheet.

We hold security deposits from our sublessees of approximately $ 0.9 million which is recorded within other non-current assets on our consolidated balance sheet.

As of December 31, 2024, the future minimum lease payments to be received under the long-term sublease agreements were as follows:

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Product revenue, net $ 36,498 $ 26,823 $ 11,740

One Customer accounted for 95 %, 96 % and 97 % of our consolidated revenues for the years ended December 31, 2024, 2023 and 2022, respectively, and 92 % and 97 % of accounts receivable from product sales for the years ended December 31, 2024 and 2023, respectively.

Reserves for Variable Consideration

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In June 2023, our stockholders approved the 2023 Stock Incentive Plan, or the 2023 Plan.

The 2023 Plan provides for the grant of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock units, or RSUs, performance-based share units, or PSUs, and other stock-based awards to employees, advisors, consultants and non-employee directors.

The 2023 Plan provides for the grant of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock awards, RSUs, PSUs, and other stock-based awards to employees, advisors, consultants and non-employee directors.

Following the adoption of the 2023 Plan, we ceased granting equity awards under the 2013 Stock Incentive Plan, or the 2013 Plan.

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Exercised ( 343,341 ) 34.39

Forfeited/Expired ( 1,160,277 ) 56.10

Cancelled/Forfeited ( 79,253 ) 39.00

Expired ( 56,918 ) 71.76

Outstanding at December 31, 2024 5,834,256 $ 43.48 6.21 $ 11,911

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Vested ( 170,550 ) 35.04

Forfeited ( 101,750 ) 46.39

Unvested shares at December 31, 2024 374,583 $ 29.45

Included in unvested shares were 145,023 shares with performance-based vesting criteria that were considered probable of achievement at December 31, 2023 and vested in January 2024.

Stock-based compensation expense associated with these PSUs is recognized if the underlying performance condition is considered probable of achievement using our management’s best estimates.

As of December 31, 2023, there was no unrecognized compensation expense related to PSUs with performance-

based vesting criteria that are considered probable of achievement that we expect to recognize.

There is $ 5.9 million of total unrecognized compensation expense related to PSUs with performance-based vesting criteria that are considered not probable of achievement.

As of December 31, 2024, there was no unrecognized compensation expense related to PSUs with performance-based vesting criteria that are considered probable of achievement that we expect to recognize.

There was $ 11.0 million of total unrecognized compensation expense related to PSUs

with performance-based vesting criteria that are considered not probable of achievement.

Market-based stock units

We have issued certain equity awards that contain market based vesting conditions, in which shares of stock are earned at vesting based on stock price performance.

The fair value of MSUs are estimated using a Monte Carlo simulation model.

The fair value of market-based stock units, or MSUs, are estimated using a Monte Carlo simulation model.

Assumptions and estimates utilized in the model include the risk-free interest rate, dividend yield, expected stock volatility and the estimated period to achievement of the market condition.

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Unvested shares at December 31, 2023 42,695 $ 41.50

Expired ( 42,695 ) 41.50

Unvested shares at December 31, 2024 — $ —

As of December 31, 2024, there was no remaining unrecognized compensation expense related to MSUs.

2013 Employee Stock Purchase Plan

In June 2013, our Board of Directors adopted, and in July 2013 our stockholders approved, the 2013 Employee Stock Purchase Plan, or the 2013 ESPP.

On January 1, 2023, the annual increase for the 2013 ESPP resulted in an additional 509,091 shares authorized for issuance.

Amended and Restated 2013 Employee Stock Purchase Plan

In June 2013, our Board of Directors adopted, and in July 2013 our stockholders approved, the 2013 ESPP, which was further amended and restated by our Board of Directors in December 2024.

We issued 102,805 shares and 112,832 shares during the years ended December 31, 2024 and 2023, respectively, under the 2013 ESPP.

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For purposes of the dilutive net income (loss) per share calculation, stock options, RSUs, PSUs and MSUs for which the performance and market vesting conditions, respectively, have been deemed probable, and 2013 ESPP shares are considered to be common stock equivalents, while PSUs and MSUs with performance and market vesting conditions, respectively, that were not deemed probable as of December 31, 2023 are not considered to be common stock equivalents.

For purposes of the dilutive net income (loss) per share calculation, stock options, RSUs and PSUs for which the performance and market vesting conditions, respectively, have been deemed probable, and 2013 ESPP shares are considered to be common stock equivalents, while PSUs with performance and market vesting conditions, respectively, that were not deemed probable as of December 31, 2024 are not considered to be common stock equivalents.

We utilize the control number concept in the computation of diluted earnings per share to determine whether potential common stock equivalents are dilutive.

The control number used is net loss from continuing operations.

The control number used is net income (loss) from continuing operations.

Basic and diluted net income (loss) per share was the same for all periods presented.

The following common stock equivalents were excluded from the calculation of diluted net loss per share applicable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect:

The following is a reconciliation of basic weighted-average number of common shares used in computing net income (loss) per share to diluted weighted-average number of common shares used in computing net income (loss) per share for the periods indicated:

Years ended December 31,

2024 2023 2022

Basic shares 56,807,415 55,651,487 54,789,435

Effect of dilutive securities

Stock options 336,446 — —

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Employee stock purchase plan shares 3,624 — —

Diluted shares 57,889,255 55,651,487 54,789,435

The following common stock equivalents were excluded from the calculation of diluted net income (loss) per share applicable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect:

Years ended December 31,

2024 2023 2022

Stock options 3,926,330 5,263,681 5,772,564

Restricted stock units 95,679 1,346,701 1,117,921

Performance-based stock units — 145,023 —

Employee Stock Purchase Plan shares 3,987 48,713 42,026

Total 4,025,996 6,804,118 6,932,511

The domestic and foreign components of loss from continuing operations before income taxes are as follows:

The domestic and foreign components of income (loss) before income taxes are as follows:

(In thousands) 2024 2023 2022

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We did not have any provision for income taxes for the years ended December 31, 2023 and 2022.

A reconciliation of the expected income tax benefit (expense) computed using the federal statutory income tax rate to our effective income tax rate is as follows for the years ended December 31, 2023, 2022 and 2021:

A reconciliation of the expected income tax expense (benefit) computed using the federal statutory income tax rate to our effective income tax rate is as follows for the years ended December 31, 2024, 2023 and 2022:

2024 2023 2022

Income tax benefit computed at federal statutory tax rate 21.0 % 21.0 % 21.0 %

Federal statutory tax rate 21.0 % 21.0 % 21.0 %

State taxes, net of federal benefit 1.6 % 1.9 % 2.9 %

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Net deferred taxes $ — $ —

The Tax Cuts and Jobs Act (TCJA) requires taxpayers to capitalize and amortize research and experimental expenditures under Internal Revenue Code section 174 for tax years beginning after December 31, 2021.

The Company capitalized research and experimental costs of $ 232.7 million and $ 261.4 million for the years ended December 31, 2023 and December 31, 2022, respectively.

The Tax Cuts and Jobs Act, or TCJA, requires taxpayers to capitalize and amortize research and experimental expenditures under Internal Revenue Code section 174 for tax years beginning after December 31, 2021.

We capitalized research and experimental costs of $ 244.9 million and $ 232.7 million for the years ended December 31, 2024 and December 31, 2023, respectively.

We will amortize these costs for tax purposes over 5 years if the research and experimentation was performed in the U.S.

and over 15 years if the research and experimentation was performed outside the U.S.

As of December 31, 2023, we had net operating loss carryforwards, or NOLs, available to reduce federal, state and foreign income taxes of approximately $ 131.7 million, $ 502.4 million and $ 65.2 million, respectively.

As of December 31, 2024, we had net operating loss carryforwards, or NOLs, available to reduce state and foreign income taxes of approximately $ 320.0 million and $ 65.2 million, respectively.

At December 31, 2024, we also had available research and development tax credits for federal and state income tax purposes of approximately $ 23.2 million and $ 29.3 million, respectively.

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Based on the weight of available evidence, both positive and negative, we recorded a valuation allowance of $ 275.6 million and $ 379.7 million as of December 31, 2024 and December 31, 2023, respectively, because we have determined that it is more likely than not that these assets will not be fully realized.

The valuation allowance increased by $ 83.7 million for the year ended December 31, 2023 and by $ 59.5 million for the year ended December 31, 2022 primarily due to the Section 174 R&D expense capitalization.

The valuation allowance decreased by $ 104.1 million for the year ended December 31, 2024 and increased by $ 83.7 million for the year ended December 31, 2023.

The decrease for the year ended December 31, 2024 relates primarily to the utilization of tax attributes to offset taxable income, and the increase for the year ended December 31, 2023 primarily due to the Section 174 R&D expense capitalization.

The following table presents our change in valuation allowance for the years ended December 31, 2024 and, 2023:

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As of December 31, 2024 and 2023, we had no accrued interest or penalties related to uncertain tax positions and no such amounts have been recognized.

If all of the Company’s unrecognized tax benefits as of December 31, 2023 were to become recognizable in the future, we would record $ 28.6 million of unrecognized tax benefits.

If all of our unrecognized tax benefits as of December 31, 2024 were to become recognizable in the future, we would record $ 31.6 million of unrecognized tax benefits.

The uncertain tax position does not impact our effective income tax rate due to the full valuation allowance.

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The statute of limitations for assessment by the IRS and state tax authorities is open for tax years ending December 31, 2024, 2023, 2022, and 2021, although carryforward attributes that were generated for tax years prior to 2021 may still be adjusted upon examination by the IRS or state tax authorities if they either have been, or will be, used in a future period.

The statute of limitations for assessment in Switzerland remains open for tax years ending December 31, 2023, 2022, 2021, 2020 and 2019.

The Company’s subsidiaries in the Netherlands and Germany were incorporated in 2019 and have statute of limitations for 5 and 4 years, respectively, for assessment.

The tax years that remain open in these jurisdictions are for the tax years ending December 31, 2023, 2022, 2021, 2020 and 2019.

The Company’s subsidiaries in Italy and France were incorporated in 2020 and have statute of limitations for 5 and 3 years, respectively, for assessment.

The tax years that remain open in these jurisdictions are for the tax years ending December 31, 2023, 2022, 2021 and 2020.

The statute of limitations for assessments in Switzerland, the Netherlands and Italy remains open for tax years ending December 31, 2024, 2023, 2022, 2021 and 2020.

Our subsidiary in Germany has statute of limitations for assessments open are for the tax years ending December 31, 2024, 2023, 2022, and 2021, and our subsidiary in France has statute of limitations for assessments for the tax years ending December 31, 2024, 2023, and 2022.

There are currently no federal, state or foreign audits in progress.

As of December 31, 2023 and 2022, we had an income tax receivable of $ 1.1 million and $ 0.3 million, respectively, recorded within prepaid expenses and other current assets.

As of December 31, 2024 we had an income tax payable of $ 0.9 million and as of December 31, 2023 we had an income tax receivable of $ 1.1 million, which is recorded within prepaid expenses and other current assets in our consolidated balance sheets.

Property and Equipment, net

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Additionally, holders of common stock are entitled to receive dividends, if and when declared by our board of directors, and to share ratably in our assets legally available for distribution to our shareholders in the event of liquidation.

Share Repurchase Program

On March 25, 2021, we announced that our board of directors authorized a repurchase program, or the Repurchase Program, for the repurchase of up to $ 1.2 billion of our outstanding shares of common stock.

On March 31, 2021, in connection with the Repurchase Program, we entered into a definitive share repurchase agreement with BMS to repurchase 7.1 million shares of our common stock held by certain subsidiaries of BMS for an aggregate purchase price of $ 344.5 million, or $ 48.38 per share.

This repurchase was completed on April 5, 2021.

Further, on April 2, 2021, in connection with the Repurchase Program, we entered into a Rule 10b5-1 repurchase plan to which we may repurchase up to $ 600.0 million of shares of our common stock.

As of December 31, 2023, we repurchased approximately 9.1 million shares of common stock for $ 458.0 million, or $ 50.35 per share, under the Rule 10b5-1 repurchase plan.

In total, as of December 31, 2023, we repurchased 16.2 million shares of common stock for $ 802.5 million, or $ 49.49 per share, under the Repurchase Program.

No common stock was purchased during the years ended December 31, 2023 or December 31, 2022.

On October 5, 2021, we terminated our Rule 10b5-1 share repurchase plan and on October 13, 2021, we entered into a Rule 10b-18 repurchase plan that allows us to conduct open market repurchases over time up to our remaining authorization under the Repurchase Program.

We have paused our share repurchases for the foreseeable future.

Repurchased shares are held as treasury stock until they are retired or re-issued.

Treasury stock purchases are accounted for under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock.

Repurchases of our common stock are accounted for as of the settlement date.

There were no retirements or re-issuances of treasury stock during the year ended December 31, 2023.

Discontinued Operations

On March 31, 2021, we completed the sale of our oncology business to Servier.

We determined the sale of the oncology business represented a strategic shift that had a major effect on our business and therefore met the criteria for classification as discontinued operations at March 31, 2021.

Accordingly, the oncology business was reported as discontinued operations in accordance with ASC 205-20, Discontinued Operations .

The results of operations from the oncology business were classified as discontinued operations in the consolidated statements of operations.

We recognized a gain on the sale of the oncology business upon closing.

The following table presents the gain on the sale for the year ended December 31, 2021:

(in thousands) December 31, 2021

Cash proceeds $ 1,802,936

transaction and insurance costs ( 53,573 )

net liabilities distributed, including working capital adjustment 239,770

Gain on sale, pre-tax 1,989,133

Income tax expense ( 12,799 )

Gain on sale, net of tax $ 1,976,334

As of December 31, 2023 and December 31, 2022, there were no assets or liabilities classified as discontinued operations.

The following table presents the financial results of the discontinued operations:

(in thousands) 2021

Product revenue, net $ 36,909

Collaboration revenue – related party 1,350

Collaboration revenue – other 491

Royalty revenue – related party 2,659

Total revenue 41,409

Cost and expenses:

Cost of sales 706

Research and development 41,564

Selling, general and administrative 8,551

Total cost and expenses 50,821

(Loss) income from discontinued operations ( 9,412 )

Non-cash interest expense for the sale of future revenue ( 5,697 )

Gain on the sale of the oncology business 1,989,133

Income from discontinued operations, pre-tax 1,974,024

Income tax expense ( 12,799 )

Net income from discontinued operations $ 1,961,225

In accordance with ASC 205-20, only expenses specifically identifiable and related to a business to be disposed may be presented in discontinued operations.

As such, the research and development, marketing, selling and general and administrative expenses in discontinued operations include corporate costs incurred directly to solely support our oncology business.

We also entered into a Transition Services Agreement with Servier, through which we provided transitional services related to discovery, clinical development, technical operations, commercial and general and administrative related activities through March 31, 2022.

The milestone payment for approval of vorasidenib and royalty payments related to vorasidenib and TIBSOVO® represent contingent consideration.

Contingent consideration has been accounted for as a gain contingency in accordance with ASC 450, Contingencies , and will be recognized in earnings in the period when realizable.

As described in Note 1, Nature of Business , on October 27, 2022, we sold our rights to future contingent payments related to TIBSOVO® royalties to entities affiliated with Sagard and recognized income of $ 127.9 million within the gain on sale of contingent payments line item in our consolidated statements of operations for the year ended December 31, 2022.

Commitments and Contingent Liabilities

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Defined Contribution Benefit Plan

We sponsor a 401(k) retirement plan, in which substantially all of our full-time employees are eligible to participate.

We sponsor a 401(k) retirement plan, in which substantially all our full-time employees are eligible to participate.

Participants may contribute a percentage of their annual compensation to this plan, subject to statutory limitations.

We will make matching contributions equal to 100 % of the employee’s contributions, subject to a maximum of 4 % of eligible compensation.

Segment Information

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the CODM or decision-making group in making decisions on how to allocate resources and assess performance.

Our CODM is our CEO.

Our CEO views our operations and manages our business as one operating segment, which derives its revenues from the development and commercialization of therapies for patients with rare diseases.

Our CEO manages and allocates resources to the operations of our company on a total company basis by assessing the overall level of resources available and how to best deploy these resources across functions and research and development projects that are in line with our long-term company-wide strategic goals.

In making these decisions, our CEO uses consolidated financial information for purposes of evaluating performance, forecasting future period financial results, allocating resources and setting incentive targets.

The CODM performs this assessment based on the Company’s consolidated net income (loss).

Through this analysis, the CODM assesses performance by comparing actual consolidated net income (loss) versus the budget, and then decides how to allocate resources to invest in the Company’s research and development programs.

The measure of segment assets is reported on the consolidated balance sheets as total assets.

The following table contains additional information on our consolidated revenue and net income (loss), including significant segment expenses:

(In thousands) Years Ended December 31:

2024 2023 2022

Product revenue, net $ 36,498 $ 26,823 $ 11,740

PK activator (PYRUKYND®) direct expenses - research and development ( 112,720 ) ( 101,322 ) ( 83,271 )

Compensation and related expenses - research and development ( 114,618 ) ( 108,484 ) ( 109,248 )

Total selling, general and administrative expenses ( 156,784 ) ( 119,903 ) ( 121,673 )

Gain on sale of contingent payments 889,136 — 127,853

Milestone payment from gain on sale of oncology business 200,000 — —

Other segment items* ( 67,787 ) ( 49,202 ) ( 57,202 )

Net income (loss) $ 673,725 $ ( 352,088 ) $ ( 231,801 )

*Other segment items primarily include milestone revenue, cost of sales, other research and development expenses, interest income and income taxes.

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What changed 10-K

Item 9A. Controls and Procedures