What changed in this filing

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Item 9A. Controls and Procedures

2026-03-19 compared with 2025-03-20 · 334 added, 284 removed, 770 unchanged (45% of the section changed)

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Evaluation of Disclosure Controls and Procedures

We maintain a system of disclosure controls and procedures, as defined in Rule 13a-15(e) promulgated under the Securities and Exchange Act of 1934, as amended (the Exchange Act), that is designed to provide reasonable assurance that information, which is required to be disclosed in our reports filed pursuant to the Exchange Act, is accumulated and communicated to management in a timely manner.

At the end of fiscal year ending December 31, 2024, we carried out an evaluation, under the supervision, and with the participation of, our management, including our Chief Executive Officer and President, who serves as our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(b).

Based upon that evaluation, our Chief Executive Officer and President concluded that our disclosure controls and procedures for the fiscal year ending as of December 31, 2024 were effective at reasonable assurance levels.

We maintain a system of disclosure controls and procedures, as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the Exchange Act), that is designed to provide reasonable assurance that information, which is required to be disclosed in our reports filed pursuant to the Exchange Act, is accumulated and communicated to management in a timely manner.

At the end of fiscal year ending December 31, 2025, we carried out an evaluation, under the supervision, and with the participation of, our management, including our Chief Executive Officer and President, who serves as our principal executive officer, and our VP, Finance, who serves as our principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(b).

Based upon that evaluation, our Chief Executive Officer and President and our VP, Finance concluded that our disclosure controls and procedures for the fiscal year ending as of December 31, 2025 were effective at reasonable assurance levels.

Management’s Annual Report on Internal Control over Financial Reporting

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Because of these inherent limitations, management does not expect that our internal controls over financial reporting will prevent all error and all fraud.

Under the supervision and with the participation of our management, including our Chief Executive Officer and President, who serves as our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control-Integrated Framework issued in 2013 by the Committee of Sponsoring Organizations of the Treadway Commission.

Under the supervision and with the participation of our management, including our Chief Executive Officer and President, who serves as our principal executive officer, and our VP, Finance, who serves as our principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control-Integrated Framework issued in 2013 by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on our evaluation under the framework in Internal Control-Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2025.

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Equity compensation plans not approved by security holders

(1) The weighted average exercise price is calculated solely based on the exercise prices of the outstanding stock options and warrants and does not reflect the shares that will be issued upon the vesting of outstanding awards of restricted stock units (RSUs), which have no exercise price.

(2) This number includes the following:

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205,462 shares subject to outstanding awards granted under the Assembly Biosciences, Inc.

Amended and Restated 2014 Stock Incentive Plan (2014 Plan), of which 136,991 were subject

to outstanding stock options and 1,159 were subject to outstanding RSUs;

Amended and Restated 2014 Stock Incentive Plan (2014 Plan), of which 204,692 were subject to outstanding stock options and 770 were subject to outstanding RSUs;

and 1,148,335 shares subject to outstanding awards granted under the Assembly Biosciences, Inc.

Amended and Restated 2018 Stock Incentive Plan, as amended (2018 Plan), of which 633,643 were subject to outstanding stock options and 66,895 were subject to outstanding RSUs.

Amended and Restated 2018 Stock Incentive Plan, as amended (2018 Plan), of which 822,690 were subject to outstanding stock options, 84,813 were subject to outstanding RSUs and 240,832 were subject to outstanding PSUs.

This number excludes purchase rights currently accruing under the Assembly Biosciences, Inc.

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and 86,097 shares reserved for issuance under the ESPP.

Eligible employees may participate in the 2018 ESPP at a minimum of 1% and up to a maximum of 15% of such employee’s compensation for each pay period, subject to annual IRS limitations of $25,000.

(4) This number includes 50,452 shares subject to stock options granted under the 2017 Inducement Award Plan (2017 Inducement Plan);

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58,746 shares subject to stock options granted under the 2020 Inducement Award Plan (2020 Inducement Plan);

and 814,000 warrants granted in a registered direct offering and a private placement in June 2024.

and 10,528,297 warrants granted in offerings in June 2024 and August 2025.

(5) This number includes:

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Shares that are forfeited under the 2010 Plan on or after June 2, 2016 will become available for issuance under the 2014 Plan.

An “Award” under the 2018 Plan, 2014 Plan or 2010 Plan is any right to receive our common stock consisting of non-statutory stock options, incentive stock options, stock appreciation rights, RSUs, or any other stock award.

In May 2018, our stockholders approved the 2018 ESPP and it was amended and restated in May 2021 and May 2024.

The 2018 ESPP provides for the purchase by employees of up to an aggregate of 226,398 shares of the Company’s common stock.

Eligible employees can purchase shares of our common stock at the end of a predetermined offering period at 85% of the lower of the fair market value at the beginning or end of the offering period.

In May 2018, our stockholders approved the ESPP, which was amended and restated in May 2021, May 2024 and June 2025.

The ESPP provides for the purchase by employees of up to an aggregate of 225,000 shares of the Company’s common stock at the end of predetermined offering periods at 85% of the lower of the fair market value at the beginning or end of each offering period.

Eligible employees may participate in the ESPP at a minimum of 1% and up to a maximum of 15% of such employee’s compensation for each pay period, subject to annual statutory limits.

Our outstanding equity compensation arrangements that have not been approved by our stockholders consist of the 2017 Inducement Plan, the 2019 Inducement Plan, the 2020 Inducement Plan and warrants granted in a registered direct offering and a private placement in June 2024.

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The only persons eligible to receive grants of awards under the 2017 Inducement Plan, the 2019 Inducement Plan or the 2020 Inducement Plan are individuals who satisfy the standards for inducement grants under Nasdaq Marketplace Rule 5635(c)(4) and the related guidance under Nasdaq IM 5635-1-that is, generally, a person not previously an employee or director of ours, or following a bona fide period of non-employment, as an inducement material to the individual's entering into employment with us.

An “Award” is any right to receive our common stock pursuant to the Inducement Plan, consisting of nonstatutory stock options, stock appreciation rights, restricted stock awards, RSUs, or any other stock award.

An “Award” is any right to receive our common stock pursuant to the Inducement Plan, consisting of non-statutory stock options, stock appreciation rights, restricted stock awards, RSUs, PSUs, or any other stock award.

Certain Relationships and Related P arty Transactions, and Director Independence

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Private Placement Warrant.

Form of Class A Warrant.

Form of Class B Warrant.

Form of Pre-Funded Warrant.

Private Placement Class A Warrant.

Private Placement Class B Warrant.

Sublease, dated July 26, 2023, by and between Arsenal Biosciences, Inc., as Sublandlord, and Assembly Biosciences, Inc., as Subtenant.

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and Anuj Gaggar, M.D., Ph.D.

Description of Document

Employment Agreement, dated February 10, 2022, between Assembly Biosciences, Inc.

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Amended and Restated 2014 Stock Incentive Plan.

Description of Document

Omnibus Amendment to Assembly Biosciences, Inc.

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Amended and Restated 2018 Stock Incentive Plan.

Amendment No.

1 to Assembly Biosciences, Inc.

Amended and Restated 2018 Stock Incentive Plan.

Amendment No.

2 to Assembly Biosciences, Inc.

Amended and Restated 2018 Stock Incentive Plan.

Form of Notice of Stock Option Grant and Stock Option Agreement under the 2018 Stock Incentive Plan.

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Second Amended and Restated 2018 Employee Stock Purchase Plan.

Amendment No.

1 to Assembly Biosciences, Inc.

Second Amended and Restated 2018 Employee Stock Purchase Plan.

Assembly Biosciences, Inc.

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Form of Restricted Stock Unit Award Notice and Restricted Stock Unit Award Agreement under the 2020 Inducement Award Plan.

Description of Document

Securities Purchase Agreement, dated June 16, 2024, by and between Assembly Biosciences, Inc.

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and Gilead Sciences, Inc.

Open Market Sale Agreement by and between Assembly Biosciences, Inc.

and Jefferies LLC.

Securities Purchase Agreement, dated August 8, 2025, by and between Assembly Biosciences, Inc.

and Gilead Sciences, Inc.

Assembly Biosciences, Inc.

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Consent of Independent Registered Public Accounting Firm.

Description of Document

Power of Attorney (included on signature page).

Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of the Chief Executive Officer Pursuant to 18 U.S.C.

Certification of the Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of the Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of the Principal Executive Officer Pursuant to 18 U.S.C.

Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Certification of the Principal Financial Officer Pursuant to 18 U.S.C.

Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Clawback Policy.

Inline XBRL Instance Document.

Inline XBRL Taxonomy Extension Schema Document.

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

Inline XBRL Taxonomy Extension Definitions Linkbase Document.

Inline XBRL Taxonomy Extension Label Linkbase Document.

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Cover Page Interactive Data File (embedded within the Inline XBRL document).

Inline XBRL Instance Document-the instance document does not appear in the Interactive Data File as its XBRL

tags are embedded within the Inline XBRL document.

Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Document.

Cover Page Interactive Data File, formatted in Inline XBRL (included as Exhibit 101)

The schedules to this exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K.

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March 19, 2026

(Principal Executive Officer and Principal Financial Officer)

(Principal Executive Officer)

/s/ Jeanette M.

Executive Director, Accounting and Treasury

March 19, 2026

(Principal Accounting Officer)

(Principal Financial Officer and Principal Accounting Officer)

/s/ William R.

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Notes to Consolidated Financial Statements

Re port of Independent Registered Public Accounting Firm

Report of Independent Registered Public A ccounting Firm

To the Stockholders and the Board of Directors of Assembly Biosciences, Inc.

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Description of the Matter

As described in Note 8 to the consolidated financial statements, in December 2024, the Company entered into the First Amendment to its 2023 Gilead Collaboration Agreement, which restructured the timing of specific options exercisable in the agreement and the fees payable to the Company.

The Company determined the First Amendment to the Gilead Collaboration Agreement represents a contract modification within the scope of the revenue from contracts with customers guidance.

The Company concluded there is a single combined performance obligation for the discovery, research and development services during the remaining collaboration term, and will recognize revenue over time using a cost-based input method consisting of a series of distinct R&D Services.

As of December 31, 2024, the total transaction price was determined to be $74.2 million, consisting of the unrecognized portion of the transaction price under the original contract, a premium of $5.2 million on Gilead's purchase of the Company's common stock in December 2024, and $10.0 million received from Gilead pursuant to the First Amendment to the Gilead Collaboration Agreement.

Auditing the Company’s accounting for the First Amendment to the Gilead Collaboration Agreement required increased audit effort due to the complex and judgmental nature of evaluating the terms and assumptions of the related amendment and the appropriate accounting for the modification under the guidance.

As described in Note 8 to the consolidated financial statements, in July 2025, the Company entered into a letter agreement related to its 2023 Gilead Collaboration Agreement, which provided reimbursement to the Company for certain nonclinical study activities.

The Company determined the letter agreement represents a contract modification within the scope of the revenue from contracts with customers guidance.

The Company concluded there is a single combined performance obligation for research and development services during the remaining collaboration term and will recognize revenue over time using a cost-based input method.

Additionally, in December 2025, Gilead exercised its option to exclusively license the Company's helicase-primase inhibitor (HPI) program.

The Company determined that Gilead’s exercise of the option represents a distinct performance obligation within the scope of the revenue from contracts with customers guidance.

The Company recognized the revenue at a point in time upon the transfer of the license to Gilead.

Auditing the Company’s accounting for the contract modification and option exercise required increased audit effort due to the complex and judgmental nature of evaluating the terms and assumptions under the agreements and determining the appropriate accounting under the revenue recognition guidance.

How We Addressed the Matter in Our Audit

To test the conclusion that the modification was accounted for appropriately, our audit procedures included, among others, reviewing the First Amendment to the Gilead Collaboration Agreement and evaluating whether management's accounting position considered all relevant facts and terms included in the agreement.

We further evaluated management's technical analysis and assessed management's conclusions to determine whether they had appropriately considered and applied the guidance and associated interpretations.

To test the conclusions that the July 2025 modification and the December 2025 option exercise were accounted for appropriately, our audit procedures included, among others, reviewing the letter agreement and reviewing the option exercise notice and related communications, and evaluating whether management’s accounting positions considered all relevant facts and terms.

We further evaluated management’s technical accounting analyses, including the identification of performance obligation, determination of the transaction price, and assessment of the timing of revenue recognition, and assessed whether management appropriately considered and applied the relevant accounting guidance and interpretations.

/s/ Ernst & Young LLP

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Marketable securities

Accounts receivable from collaboration

Accounts receivable from collaboration with a related party

Prepaid expenses and other current assets

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Year Ended December 31,

Collaboration revenue ($ 28,520 and $ 4,430 from a related party)

Collaboration revenue from a related party

Operating expenses

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Other comprehensive loss

Unrealized (loss) gain on marketable securities

Unrealized gain (loss) on marketable securities

Comprehensive loss

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Issuance of common stock under at-the-market (ATM) equity offering program, net of issuance costs

Issuance of common stock in a private placement to a related party, net of issuance costs

Issuance of common stock and warrants in a registered direct offering, net of issuance costs

Issuance of common stock and warrants in a private placement to a related party, net of issuance costs

Issuance of common stock upon exercise of stock options

Issuance of common stock under Employee Stock Purchase Plan (ESPP)

Issuance of common stock for settlement of restricted stock units (RSUs)

Unrealized gain on marketable debt securities

Unrealized loss on marketable debt securities

Stock-based compensation

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Issuance of common stock under ATM equity offering program, net of issuance costs

Issuance of common stock and warrants in a registered direct offering, net of issuance costs

Issuance of common stock and warrants in private placements to a related party, net of issuance costs

Issuance of common stock upon exercise of stock options

Issuance of common stock, pre-funded warrants and warrants in an underwritten offering, net of issuance costs

Issuance of common stock and warrants in a private placement to a related party, net of issuance costs

Issuance of common stock upon exercise of warrants

Issuance of common stock under ESPP

Issuance of common stock upon exercise of stock options

Issuance of common stock for settlement of RSUs

Unrealized loss on marketable debt securities

Unrealized gain on marketable debt securities

Stock-based compensation

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Cash flows from operating activities

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

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

Depreciation and amortization

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Non-cash rent expense

Loss on disposal of property and equipment

Realized gain on investments in marketable debt securities

Changes in operating assets and liabilities:

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Other accrued expenses

Deferred revenue (-$ 13,294 and $ 86,294 from a related party)

Deferred revenue from a related party

Operating lease liabilities

Net cash (used in) provided by operating activities

Net cash used in operating activities

Cash flows from investing activities

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Purchases of marketable securities

Proceeds from sale of property and equipment

Purchases of property and equipment

Net cash provided by (used in) investing activities

Net cash (used in) provided by investing activities

Cash flows from financing activities

Proceeds from the issuance of common stock, pre-funded warrants and warrants in an underwritten offering, net of issuance costs

Proceeds from the issuance of common stock and warrants in private placements to a related party, net of issuance costs

Proceeds from the issuance of common stock and warrants in a registered direct offering, net of issuance costs

Proceeds from the issuance of common stock under ATM equity offering programs, net of issuance costs

Proceeds from the exercise of warrants

Proceeds from the issuance of common stock under ATM equity offering program, net of issuance costs

Proceeds from the issuance of common stock under ESPP

Proceeds from the exercise of stock options

Proceeds from the issuance of common stock and warrants in a registered direct offering, net of issuance costs

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents at the beginning of the year

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Operating lease liabilities arising from obtaining ROU assets

Supplemental disclosure of cash flow information

Income taxes paid

See Accompanying Notes to the Consolidated Financial Statements

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The Company's pipeline includes multiple clinical-stage investigational therapies, including:

(1) two helicase-primase inhibitors (HPI) targeting recurrent genital herpes;

(2) an orally bioavailable hepatitis delta virus (HDV) entry inhibitor;

and (3) a highly potent next-generation capsid assembly modulator (CAM) designed to disrupt the replication cycle of hepatitis B virus (HBV) at several key points.

The Company's pipeline also includes a novel, oral broad-spectrum non-nucleoside polymerase inhibitor (NNPI) targeting transplant-related herpesviruses, which is currently undergoing studies to enable a regulatory filing, and it has additional research programs against multiple antiviral targets.

(1) two long-acting helicase-primase inhibitors (HPI) for the treatment of recurrent genital herpes;

(2) an orally bioavailable hepatitis delta virus entry inhibitor;

and (3) a highly potent next-generation capsid assembly modulator designed to disrupt the replication cycle of hepatitis B virus (HBV) at several key points.

The Company's pipeline also includes a novel, oral broad-spectrum non-nucleoside polymerase inhibitor (NNPI) for the treatment of transplant-related herpesviruses, which is currently undergoing studies to enable a regulatory filing, and it has additional research programs against multiple antiviral targets.

In December 2025, pursuant to the collaboration with Gilead Sciences, Inc.

(Gilead), Gilead exercised its option to license the Company's HPI program, including its long-acting investigational candidates ABI-1179 (1179) and ABI-5366 (5366).

For additional information see Note 8 - Collaboration Agreements.

The Company operates in one segment and is headquartered in South San Francisco, California (s ee Note 13 - Segment Reporting).

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Food and Drug Administration (FDA) or an applicable foreign regulatory agency.

Since inception, the Company’s operations have been financed through the sale of equity securities, payments related to collaboration agreements, the proceeds from the exercise of warrants and stock options and the issuance of debt.

Since the Company’s initial public offering, its operations have been financed through the sale of equity securities and payments related to collaboration agreements.

The Company has incurred losses from operations since inception and expects to continue to incur substantial losses for the next several years as it continues its product development efforts.

Management believes the Company currently has sufficient funds to meet its operating requirements for at least the next twelve months following the date these consolidated financial statements are issued.

The Company intends to obtain any additional funding it requires through strategic relationships, public or private equity or debt financings, grants or other arrangements.

The Company cannot assure such funding will be available on reasonable terms, if at all.

Market volatility, inflation or other factors could also adversely impact the Company's ability to access capital when and as needed.

If the Company is unable to secure additional sources of funding or generate enough revenue from its collaborations, it may be necessary to significantly reduce the current rate of spending through reductions in staff and delaying, scaling back, or discontinuing certain research and development programs, including more costly clinical trials.

As of December 31, 2025, the Company held cash, cash equivalents and marketable securities of $ 248.1 million .

Management believes the Company currently has sufficient funds to meet its operating requirements beyond one year from the date these consolidated financial statements are issued.

Note 2 - Summary of Significant Accounting Policies and Recent Accounting Pronouncements

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Other Risks and Uncertainties

and global financial markets have experienced volatility and disruption due to macroeconomic and geopolitical events such as rising inflation, changes in interest rates to combat inflation, the war between Russia and Ukraine, the conflicts in the Middle East, the rising tensions between China and Taiwan, as well as tariffs.

and global financial markets have experienced and may continue to experience volatility and disruption due to macroeconomi c and geopolitical events such as rising inflation, changes in interest rates to combat inflation, the war between Russia and Ukraine, the conflicts in the Middle East, including the recent hostilities involving Iran, and in Venezuela, tensions between China and Taiwan, as well as tariffs or the imposition and enforceability of tariffs, trade wars, barriers or restrictions, or threats of such actions and the related uncertainty thereof, including uncertainties regarding the ability to obtain refunds for previously paid tariffs that have subsequently been invalidated.

The Company cannot predict at this time to what extent, if at all, it and its employees, contract research organizations (CROs), vendors and/or collaborators could potentially be negatively impacted by these events.

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In determining the net present value of lease payments, the Company uses its incremental borrowing rate based on the information available at the lease commencement date.

The incremental borrowing rate represents the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease.

The Company considers a lease term to be the noncancelable period that it has the right to use the underlying asset, including any periods where it is reasonably assured the Company will exercise the option to extend

the contract.

The incremental borrowing rate represents the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over

the term of a lease.

Periods covered by an option to extend are included in the lease term if the lessor controls the exercise of that option.

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Amounts related to transactions with a counterparty in a collaborative arrangement that is not a customer are presented on a separate line item from revenue recognized from contracts with customers, if any, in the Company’s consolidated statements of operations and comprehensive loss.

Under certain collaborative arrangements, the Company has been reimbursed for a portion of its research and development expenses or participates in the cost-sharing of such research and development expenses.

Under certain agreements under the scope of the collaborative arrangements accounting standard, the Company has been reimbursed for a portion of its research and development expenses or participates in the cost-sharing of such research and development expenses.

Such reimbursements and cost-sharing arrangements are reflected as a reduction of research and development expense in the Company’s consolidated statements of operations and comprehensive loss.

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For contracts with customers, the Company applies the following five-step model in order to determine this amount:

(1) identification of the promised goods or services in the contract;

(2) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract;

(1) identification of the contract(s) with a customer;

(2) identification of the performance obligations in the contract, including whether they are distinct in the context of the contract;

(3) measurement of the transaction price, including the constraint on variable consideration;

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and (5) recognition of revenue when (or as) the Company satisfies each performance obligation.

Amounts of variable consideration are included in the transaction price to the extent it is probable a significant reversal in the amount of cumulative revenue recognized will not occur and when the uncertainty associated with the variable consideration is subsequently resolved.

The Company has provided standard indemnification and protection of licensed intellectual property for its customers.

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or (iii) as a cumulative catch-up adjustment to the original contract if the remaining goods or services are not distinct from those transferred before the modification.

If a license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from nonrefundable, upfront license fees based on the relative value prescribed to the license compared to the total value of the arrangement.

If a license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from license fees based on the relative value prescribed to the license compared to the total value of the arrangement.

The revenue is recognized when the license is transferred to the collaborator and the collaborator is able to use and benefit from the license.

For licenses that are not distinct from other obligations identified in the arrangement, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time.

If the combined performance obligation is satisfied over time, the Company applies an appropriate method of measuring progress for purposes of recognizing revenue from nonrefundable, upfront license fees.

If the combined performance obligation is satisfied over time, the Company applies an appropriate method of measuring progress for purposes of recognizing revenue from license fees.

The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition.

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The promises under the Company’s agreements may include research and development services to be performed by the Company on behalf of the counterparty.

If these services are determined to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes the transaction price allocated to these

services as revenue over time based on an appropriate measure of progress when the performance by the Company does not create an asset with an alternative use and the Company either has received or has an enforceable right to payment for the performance completed to date.

If these services are determined to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes the transaction price allocated to these services as revenue over time based on an appropriate measure of progress when the performance by the Company does not create an asset with an alternative use and the Company either has received or has an enforceable right to payment for the performance completed to date.

If these services are determined not to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes the transaction price allocated to the combined performance obligation as the related performance obligations are satisfied.

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The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less.

At December 31, 2025 , all accounts receivable from collaboration with a related party are deemed collectible.

There were no accounts receivable from collaboration as of December 31, 2024 .

At December 31, 2023 , all accounts receivable from collaboration are deemed collectible.

Warrants and Pre-Funded Warrants

The Company determines the accounting classification of warrants it issues as either liability or equity-classified based on an assessment of the warrant’s specific terms.

The assessment considers whether the warrants are freestanding

financial instruments, whether the warrants meet the definition of a liability and whether the warrants meet all the requirements for equity classification.

Equity classified warrants are accounted for using a relative fair value allocation method, with fair values determined at issuance using a Black-Scholes model.

Stock-Based Compensation

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The fair value of RSUs is determined based on the number of shares granted and the quoted market price of the Company’s common stock on the date of grant.

If stock-based awards are granted in contemplation of or shortly before a planned release of material nonpublic information, and such information is expected to result in a material increase in the Company’s share price, the Company considers whether an adjustment to the observable market price is required when estimating fair values.

Compensation cost is recognized as expense on a straight-line basis over the requisite service period of the award.

Stock-based awards with graded vesting schedules are recognized using the

accelerated attribution method on a straight-line basis over the requisite service period for each separately vesting portion of the award.

For awards that have a performance condition, compensation cost is measured based on the fair value of the award on the grant date, the date performance targets are established, and is expensed over the requisite service period for each separately vesting tranche when achievement of the performance condition becomes probable.

The Company assesses the probability of the performance conditions being met on a continuous basis.

For awards that have a market condition, compensation cost is measured based on the grant-date fair value of the award and is expensed over the derived service period regardless of whether the underlying market condition is met.

Forfeitures are recognized when they occur.

The fair value of performance stock units (PSUs), which include awards with performance conditions and market conditions, are determined as follows:

(i) PSUs with performance conditions are measured based on the fair value of the award on the grant date, the date performance targets are established, and is expensed over the requisite service period for each separately vesting tranche when achievement of the performance condition becomes probable, and (ii) PSUs with market conditions are measured based on the grant-date fair value of the award and is expensed over the derived service period regardless of whether the underlying market condition is met.

The Company estimates the fair value of stock option grants that do not contain market-based vesting conditions using the Black-Scholes option pricing model.

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Treasury zero-coupon bonds with maturities similar to those of the expected term of the stock option being valued.

The Company is also required to make estimates as to the probability of achieving the specific performance conditions.

Compensation cost is recognized as expense on a straight-line basis over the requisite service period of the award.

Stock-based awards with graded vesting schedules are recognized using the accelerated attribution method on a straight-line basis over the requisite service period for each separately vesting portion of the award.

Forfeitures are recognized when they occur.

The Company assesses the probability of the performance conditions being met on a continuous basis and is also required to make estimates as to the probability of achieving the specific performance conditions.

If actual results are not consistent with the Company’s assumptions and judgments used in making these estimates, the Company may be required to increase or decrease compensation expense, which could be material to the Company’s consolidated results of operations.

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There may be instances in which payments made to the Company’s vendors will exceed the level of services provided and result in a prepayment of the expense.

Payments under some of these contracts depend on factors such as the successful enrollment of subjects and the completion of clinical study milestones.

Payments under some of these contracts depend on factors such as the successful enrollment of subjects and

the completion of clinical study milestones.

In amortizing or accruing service fees, the Company estimates the time period over which services will be performed, enrollment of subjects, number of sites activated and the level of effort expended in each period.

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It is the Company’s policy to recognize interest and penalties related to income tax matters in income tax expense.

Pursuant to Section 174 of the Internal Revenue Code (Sec.

174), expenses associated with research conducted in the United States are capitalized and amortized over a five-year period.

For expenses associated with research outside of the United States, Sec.

174 expenses are capitalized and amortized over a 15 -year period.

In July 2025, the U.S.

enacted tax reform legislation through the One Big Beautiful Bill Act (OBBBA).

Some of the provisions of the new tax law affecting corporations include but are not limited to current deduction of domestic research expenses, increasing the limit of the deduction of interest expense deduction to thirty percent of earnings before interest, tax, depreciation and amortization, and one hundred percent bonus depreciation on eligible property acquired after January 19, 2025.

The Company has evaluated the impact the new tax law had on its financial condition and results of operations.

The impact of the tax law changes from the OBBBA is included in the Company’s consolidated financial statements.

Net Loss per Share

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Unvested RSUs

Unvested PSUs

In August 2025, the Company sold pre-funded warrants to purchase up to 1,040,820 shares of common stock (see Note 6 - Stockholders' Equity).

The pre-funded warrants are exercisable at $ 0.001 per share.

The shares of common stock into which the pre-funded warrants may be exercised are considered outstanding for purposes of computing earnings per share because the shares may be issued for little or no consideration, they are fully vested, and are exercisable after the original issuance date.

Comprehensive Loss

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Certain materials and key components the Company utilizes in its operations are obtained through single suppliers.

Since the suppliers of key components and materials must be named in a New Drug Application (NDA) filed with the FDA for a product, significant delays can occur if the qualification of a new supplier is required.

Since the suppliers of key components and materials must be named in a New Drug Application filed with the FDA for a product, significant delays can occur if the qualification of a new supplier is required.

If delivery of material from the Company’s suppliers were interrupted for any reason, the Company may be unable to supply any of its product candidates for clinical trials.

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Recently Adopted Accounting Standards

In November 2023, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (ASU 2023-07), which requires public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis.

Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis.

The Compa ny adopted ASU 2023-07 during the year ended December 31, 2024 .

See Note 13 - Segment Reporting for further details.

Accounting Pronouncements to Be Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

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

Improvements to Income Tax Disclosures (ASU 2023-09).

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In addition, all entities are required to disclose income taxes paid, net of refunds received disaggregated by federal, state/local, and foreign and by jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received.

Adoption of ASU 2023-09 allows for either the prospective or retrospective application of the amendment and is effective for annual periods beginning after December 15, 2024, with early adoption permitted.

The Company does not expect ASU 2023-09 to have a material impact on the Company’s consolidated financial statements.

The Company adopted ASU 2023-09 on a prospective basis during the year ended December 31, 2025 .

See Note 10 - Income Taxes for further details.

Accounting Pronouncements to Be Adopted

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 (ASU 2024-03), which requires the disaggregation of certain expense captions into specified categories in disclosures within the notes to the

financial statements to provide enhanced transparency into the expense captions presented on the face of the income statement.

Disaggregation of Income Statement Expenses (ASU 2024-03), which requires the disaggregation of certain expense captions into specified categories in disclosures within the notes to the financial statements to provide enhanced transparency into the expense captions presented on the face of the income statement.

ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted, and may be applied either prospectively or retrospectively to financial statements issued for reporting periods after the effective date of ASU 2024-03 or retrospectively to any or all prior periods presented in the financial statements.

The Company does not expect ASU 2024-03 to ha ve a material impact on the Company’s consolidated financial statements.

The Company does not expect the potential impact of adopting ASU 2024-03 to have a material impact on its disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements (ASU 2025-11), which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting.

The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity.

ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted.

The Company does not expect the impact of adopting ASU 2025-11 to have a material impact on its financial statements.

Note 3 - Related Party

In October 2023, the Company entered into an Option, License and Collaboration Agreement (the Gilead Collaboration Agreement), and a Common Stock Purchase Agreement and an Investor Rights Agreement (collectively, the Gilead Equity Agreements) with Gilead Sciences, Inc.

(Gilead) under which it received aggregate gross proceeds of $ 100.0 million .

In October 2023, the Company entered into the Option, License and Collaboration Agreement (Gilead Collaboration Agreement), and a Common Stock Purchase Agreement and an Investor Rights Agreement (collectively, the Gilead Equity Agreements) with Gilead.

Following the Company entering into the Gilead Equity Agreements, and as of December 31, 2025, Gilead is considered a related party based on its ownership of the Company's common stock.

Gilead Equity Agreements

In June 2024, the Company entered into a Securities Purchase Agreement with Gilead for the issuance and sale of 179,500 shares of common stock and a warrant to purchase up to 179,500 shares of common stock in a private

placement (the June 2024 Private Placement).

This transaction, which generated aggregate gross proceeds of $ 2.8 million, was executed concurrently with the June 2024 Registered Direct Offering (as defined below).

See Note 6 - Stockholders' Equity for additional details.

Also in June 2024, the Gilead Equity Agreements were amended.

The amendments did not have an impact on the Company’s consolidated financial statements.

In December 2024, Gilead exercised its right under the Gilead Equity Agreements to purchase additional shares of common stock from the Company at a purchase price of $ 21.37 per share, for aggregate proceeds of $ 20.1 million, resulting in Gilead owning 29.9 % of the Company's then-outstanding voting common stock.

In August 2025, the Company entered into a Securities Purchase Agreement with Gilead for the issuance and sale of 2,295,920 shares of common stock and accompanying Class A and Class B warrants to purchase up to an aggregate of 2,295,920 shares of common stock in a private placement (collectively, the August 2025 Private Placement).

This transaction, which generated aggregate gross proceeds of $ 45.0 million, was executed concurrently with the August 2025 Underwritten Offering (as defined below).

See Note 6 - Stockholders' Equity for additional details.

Gilead Collaboration Agreement

In December 2024, the Company and Gilead entered into the First Amendment to the Gilead Collaboration Agreement, which restructured the timing of specific options exercisable in the agreement and the fees payable to the Company to support an accelerated development plan for ABI-6250 (6250), under which the Company received a non-refundable payment of $ 10.0 million.

In July 2025, the Company entered into a letter agreement with Gilead under which Gilead has agreed to reimburse the Company up to $ 1.5 million for certain nonclinical study activities, subject to the terms and conditions set forth in the agreement.

The letter agreement does not amend any terms of the Gilead Collaboration Agreement.

In December 2025, Gilead exercised its combined option to obtain an exclusive license to the Company's HPI program, including 5366 and 1179.

Upon exercise of the option, the Company received an opt-in payment of $ 35.0 million.

As of December 31, 2025, the Company recorded $ 1.0 million in accounts receivable from collaboration on the consolidated balance sheet for reimbursable costs incurred under the Gilead Collaboration Agreement.

The Company recognized $ 72.3 million and $ 28.5 million of collaboration revenue under the Gilead Collaboration Agreement during the years ended December 31, 2025 and 2024, respectively.

Pursuant to the Investor Rights Agreement, Gilead designated two directors to the Company’s board of directors, who were appointed in December 2023 and February 2024.

In June 2024, the Company entered into a Securities Purchase Agreement pursuant to which it issued and sold 179,500 shares of common stock and a warrant to purchase up to 179,500 shares of common stock in a private placement to Gilead (the June 2024 Private Placement).

This transaction was executed concurrently with a Securities Purchase Agreement the Company entered into with an investor for a registered direct offering (the June 2024 Registered Direct Offering) pursuant to anti-dilution provisions in the Investor Rights Agreement.

The common stock and warrant in the June 2024 Private Placement were sold at the same combined offering price as the June 2024 Registered Direct Offering of $ 15.46 per share, for aggregate gross proceeds to the Company of approximately $ 2.8 million.

Also in June 2024, the Gilead Equity Agreements were amended to extend deadlines relating to the Company’s efforts to complete an equity financing and its right to require Gilead to purchase additional shares of the Company’s common stock by three months.

This right expired in October 2024.

The amendments also explicitly included the shares of the Company's common stock and warrant sold under the June 2024 Private Placement in the definition of registrable securities.

The amendments to the Gilead Equity Agreements did not have an impact to the Company's consolidated financial statements.

In December 2024, the Company and Gilead entered into the First Amendment to the Gilead Collaboration Agreement, which restructured the timing of specific options exercisable in the agreement and the fees payable to the Company to support an accelerated development plan for ABI-6250 (6250), under which it received a non-refundable payment of $ 10.0 million.

Also in December 2024, Gilead exercised its right under the Gilead Equity Agreements to purchase additional shares of common stock from the Company at a purchase price of $ 21.37 per share, for aggregate proceeds of $ 20.1 million, resulting in Gilead owning 29.9 % of the Company's then-outstanding voting common stock.

Based on Gilead's ownership as of December 31, 2024, Gilead is considered a related party.

See Note 6 - Stockholders' Equity and Note 8 - Collaboration Agreements for additional details.

See Note 8 - Collaboration Agreement for additional details.

Note 4 - Investments in Marketable Securities

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Money market fund

treasury securities

Total cash equivalents

Short-term marketable securities

and foreign corporate debt securities

Corporate debt securities

Asset-backed securities

treasury securities

and foreign commercial paper

Commercial paper

Total short-term marketable securities

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Money market fund

treasury securities

Total cash equivalents

Short-term marketable securities

and foreign corporate debt securities

Corporate debt securities

treasury securities

and foreign commercial paper

Commercial paper

Total short-term marketable securities

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Short-term marketable securities held as of December 31, 2025 and 2024 had contractual maturities of less than one year .

There were no realized gains and losses for the years ended December 31, 2024 and 2023.

The realized gains on investments in marketable debt securities for the year ended December 31, 2025 were not material.

There were no realized gains and losses for the years ended December 31, 2024.

There were no investments in an unrealized loss position as of December 31, 2025.

As of December 31, 2024, investments which were in an unrealized loss position were not material and generally due to interest rate fluctuations, as opposed to declines in credit quality.

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Money market fund

treasury securities

Total cash equivalents

Short-term marketable securities

and foreign corporate debt securities

Corporate debt securities

Asset-backed securities

treasury securities

and foreign commercial paper

Commercial paper

Total short-term marketable securities

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Money market fund

treasury securities

Total cash equivalents

Short-term marketable securities

and foreign corporate debt securities

Corporate debt securities

treasury securities

and foreign commercial paper

Commercial paper

Total short-term marketable securities

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Reverse Stock Split

In September 2023, the Company received a letter from the Listing Qualifications Department of the Nasdaq Stock Market notifying the Company, as the bid price for its common stock had closed below $ 1.00 per share for the last 30 consecutive business days, it was not in compliance with Nasdaq Listing Rule 5450(a)(1), which is the minimum bid price requirement for continued listing on the Nasdaq Global Select Market.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company was provided a 180-calendar day period, or until March 25, 2024, to regain compliance with the minimum bid price requirement.

The continued listing standard would be met once the closing bid price of the Company’s common stock was at least $ 1.00 per share for a minimum of ten consecutive business days during the 180-calendar day period.

In January 2024, the Company's stockholders approved a reverse stock split of its common stock at a range of ratios between 1-for-7 to 1-for-17 , and the Company's board of directors approved the implementation of the reverse stock split at a ratio of 1-for-12 (the Reverse Stock Split).

The Reverse Stock Split was effective as of February 9, 2024 and the Company regained compliance with the minimum bid price requirement in February 2024.

The Reverse Stock Split was undertaken to enable the Company to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Global Select Market, as referenced in the deficiency notice received from the Nasdaq Listing Qualifications Department in September 2023.

The Reverse Stock Split became effective in February 2024, at which time the Company regained compliance with the minimum bid price requirement.

As of the effective time of the Reverse Stock Split, every 12 issued and outstanding shares of the Company’s common stock was automatically reclassified into one issued and outstanding share of the Company’s common stock.

This reduced the number of shares outstanding from 65.8 million shares to 5.5 million shares.

The Reverse Stock Split did not affect the number of authorized shares of common stock or the par value of the common stock.

No fractional shares of common stock were issued in connection with the Reverse Stock Split and all fractional shares were rounded down to the nearest whole share with respect to outstanding shares of common stock.

Any holders of common stock who would have otherwise received a fractional share of common stock pursuant to the Reverse Stock Split, received cash in lieu of the fractional share.

All share and per share amounts of the Company's common stock presented in this Annual Report on Form 10-K have been adjusted to reflect the 1-for-12 Reverse Stock Split.

The Company's authorized shares of common stock remain at 150,000,000 and its authorized shares of preferred stock remain at 5,000,000 .

Any holders of common stock who would

have otherwise received a fractional share of common stock pursuant to the Reverse Stock Split, received cash in lieu of the fractional share.

The Reverse Stock Split did not affect the par value of the common stock.

The Company's authorized shares of common stock remained at 150,000,000 and its authorized shares of preferred stock remained at 5,000,000 .

Sale of Common Stock and Warrants

At-The-Market Offering

In August 2020, the Company entered into a sales agreement under which the Company may offer and sell shares of its common stock having an aggregate offering price of up to $ 100.0 million through “at-the-market” offerings (2020 ATM), pursuant to its shelf registration statement on Form S-3 with the SEC (File No.

333-248469), which became effective in September 2020.

The Company did not sell any shares of its common stock under the 2020 ATM during the year ended December 31, 2024.

During the year ended December 31, 2023, the Company issued and sold 261,170 shares of its common stock under the 2020 ATM, for which the Company received net proceeds of $ 4.5 million , after deducting commissions, fees and expenses.

In November 2024, the Company terminated the 2020 ATM and entered into a new sales agreement under which the Company may offer and sell shares of its common stock having an aggregate offering price of up to $ 75.0 million through "at-the-market" offerings (2024 ATM), pursuant to its shelf registration statement on Form S-3 (File No.

In November 2024, the Company entered into a sales agreement under which the Company may offer and sell shares of its common stock having an aggregate offering price of up to $ 75.0 million through "at-the-market" offerings (the ATM), pursuant to its shelf registration statement on Form S-3 (File No.

333-270760), which became effective in April 2023.

During the year ended December 31, 2025, the Company issued and sold 161,645 shares of its common stock under the ATM, for which the Company received net proceeds of $ 1.9 million , after deducting commissions, fees and expenses.

During the year ended December 31, 2024, the Company issued and sold 152,666 shares of its common stock under the ATM, for which the Company received net proceeds of $ 2.0 million , after deducting commissions, fees and expenses.

Registered Direct Offering

In June 2024, under the June 2024 Registered Direct Offering and pursuant to its shelf registration statement on Form S-3 on file with the SEC, the Company issued and sold 634,500 shares of common stock and a warrant to purchase up to 634,500 shares of common stock.

In June 2024, the Company issued and sold 634,500 shares of common stock and a warrant to purchase up to 634,500 shares of common stock in a registered direct offering pursuant to its shelf registration statement on Form S-3 on file with the SEC (the June 2024 Registered Direct Offering).

The common stock and warrant were sold at a combined offering price of $ 15.46 per share for aggregate gross proceeds to the Company of $ 9.8 million.

After deducting issuance costs, net proceeds totaled $ 9.7 million.

Underwritten Offering

In August 2025, the Company issued and sold an aggregate of 5,591,840 shares of common stock and pre-funded warrants to purchase up to 1,040,820 shares of common stock, together with accompanying 3,316,330 Class A and 3,316,330 Class B warrants to purchase up to an aggregated total of 6,632,660 shares of common stock in an underwritten offering (the August 2025 Underwritten Offering).

The combined price per share of common stock with the accompanying Class A and Class B warrants was $ 19.60 , while the combined price per pre-funded warrant with accompanying Class A and Class B warrants was $ 19.599 .

The offering generated aggregate gross proceeds to the Company of $ 130.0 million.

After deducting issuance costs, net proceeds totaled $ 123.6 million.

Private Placements

In October 2023, the Company entered into the Gilead Equity Agreements, which were amended in June 2024.

Pursuant to the Gilead Equity Agreements, Gilead purchased 1,089,472 shares of the Company’s common stock in a private placement at a purchase price of $ 13.92 per share for total proceeds of $ 15.2 million.

Of these proceeds, $ 5.9 million was determined to be a premium on the purchase of the Company’s common stock and allocated to the single

combined performance obligation under the Gilead Collaboration Agreement (see Note 8 - Collaboration Agreements).

The fair value of Gilead's common stock purchase was $ 9.3 million and total proceeds from the issuance of the Company's common stock under the Gilead Equity Agreements was $ 9.1 million, net of $ 0.2 million in issuance costs.

Pursuant to the terms of the amended Gilead Equity Agreements, if the Company completed an equity financing by October 2024 , which would have resulted in at least $ 30.0 million of proceeds to the Company, then, subject to approval by the Company’s stockholders (which was obtained on January 31, 2024), the Company would have had the right to require Gilead to purchase additional shares of its common stock from the Company in an amount that resulted in Gilead owning 29.9 % of the Company’s common stock.

This right expired in October 2024.

The terms of the Gilead Equity Agreements also provided Gilead with the right to elect to purchase additional shares of common stock from the Company at a premium in an amount that would result in Gilead owning 29.9 % of the Company's common stock.

The Gilead Equity Agreements also include a three-year standstill provision and a two-year lockup provision, each with customary exceptions, and provide Gilead with certain other stock purchase rights and registration rights, as well as the right to designate two directors to the Company’s board of directors.

In June 2024, the Company issued and sold 179,500 shares of common stock and a warrant to purchase up to 179,500 shares of common stock under the June 2024 Private Placement with Gilead.

In June 2024, the Company issued and sold 179,500 shares of common stock and a warrant to purchase up to 179,500 shares of common stock under the June 2024 Private Placement with Gilead (as defined in Note 3 - Related Party) .

This transaction was executed concurrently with the June 2024 Registered Direct Offering pursuant to anti-dilution provisions in the Investor Rights Agreement, with the common stock and warrant sold at the same combined offering price of $ 15.46 per share for aggregate gross proceeds to the Company of $ 2.8 million.

After deducting issuance costs, net proceeds totaled $ 2.7 million.

In December 2024, Gilead exercised its right under the Gilead Equity Agreements to purchase an additional 940,499 shares of common stock from the Company at a purchase price of $ 21.37 per share, which represents a 35 % premium to the 30 trading day volume weighted average price immediately prior to the date of purchase.

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The fair value of Gilead's common stock purchase was $ 14.9 million.

The warrants sold in the June 2024 Registered Direct Offering and June 2024 Private Placement have an exercise price of $ 17.00 per share, were immediately exercisable upon issuance, and expire on June 18, 2029 .

Neither party may exercise any portion of the warrants to the extent it would beneficially own more than the limits defined in the warrant agreements.

In August 2025, the Company entered into the August 2025 Private Placement (as defined in Note 3 - Related Party) with Gilead, which involved the issuance and sale of 2,295,920 shares of common stock and accompanying 1,147,960 Class A and 1,147,960 Class B warrants to purchase up to an aggregate of 2,295,920 shares of common stock in a private placement.

This transaction was executed concurrently with the August 2025 Underwritten Offering.

The combined price per share of common stock with the accompanying Class A and Class B warrants was $ 19.60 , generating aggregate gross proceeds of $ 45.0 million.

After deducting issuance costs, net proceeds totaled $ 42.8 million.

These warrants have the same exercise price and terms as the warrants sold in the August 2025 Underwritten Offering.

The following warrants and pre-funded warrants to purchase shares of the Company's common stock were issued and outstanding:

Exercisable Date

Expiration Date

Exercise Price per Share

No expiration

8/11/2030 (1)

11/15/2026 (2)

12/31/2026 (2)

(1) These Class A warrants will expire 30 days following the public announcement that the Company completed enrollment (of at least 200 patients total) in the ABI-5366 Phase 2 clinical study if prior to August 11, 2030.

(2) These Class B warrants will be cancelled if the Company publicly announces the receipt of at least $ 75.0 million in the aggregate of non-dilutive capital in connection with a collaboration agreement prior to November 15, 2026.

There were 255,103 Class A warrants exercised during December 31, 2025.

No warrants were exercised during December 31, 2024.

The Company’s warrants and pre-funded warrants are classified as a component of permanent stockholders’ equity within additional paid-in capital and were recorded at their respective issuance date using a relative fair value allocation method.

Of the total proceeds from the issuance of warrants in the August 2025 Underwritten Offering and the August 2025 Private Placement, $ 16.4 million was allocated to pre-funded warrants, $ 24.6 million to Class A warrants and $ 1.2 million to Class B warrants.

The warrants and pre-funded warrants are equity classified because they are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, do not embody an obligation for the Company to repurchase its shares, permit the holders to receive a fixed number of common shares upon exercise, are indexed to the Company’s common stock and meet the equity classification criteria.

In addition, such warrants and pre-funded warrants do not provide any guarantee of value or return.

Holders of all warrants and pre-funded warrants cannot exercise any portion of the warrants to the extent they would beneficially own more than the limits defined in the warrant agreements.

The exercise price and number of shares of the Company's common stock issuable upon the exercise of the warrants are subject to adjustment in the event of any stock dividends and distributions, stock splits, stock combinations or stock reclassifications, as described in the respective warrant agreements.

Under certain circumstances, the warrants may be exercised on a “cashless” basis.

The warrants were classified as a component of permanent stockholders’ equity within additional paid-in-capital and were recorded at the issuance date.

The warrants are equity classified because they are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, are immediately exercisable, do not embody an obligation for the Company to repurchase its shares, permit the holders to receive a fixed number of common shares upon exercise, are indexed to the Company’s common stock and meet the equity classification criteria.

In addition, such warrants do not provide any guarantee of value or return.

As of December 31, 2024 , there were 814,000 outstanding and no warrants exercised during the year then ended.

Note 7 - Stock-Based Compensation

Equity Incentive Plans

In May 2023, the Company's stockholders approved an amendment to the Assembly Biosciences, Inc.

In June 2025, the Company's stockholders approved an amendment to the Assembly Biosciences, Inc.

Amended and Restated 2018 Stock Incentive Plan (the 2018 Plan) , which increased the aggregate number of shares of common stock reserved under the 2018 Plan to 1,703,333 .

In May 2024, the Company's stockholders approved an amendment to the 2018 Plan, which increased the aggregate number of shares of common stock reserved under the 2018 Plan to 1,103,333 .

As of December 31, 2025, the Company had awards outstanding under the following shareholder approved plans:

2010 Equity Incentive Plan (the 2010 Plan), which has been frozen;

2010 Equity Incentive Plan (the 2010 Plan), which has been frozen since 2016;

the Assembly Biosciences, Inc.

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and the 2018 Plan.

Shares of common stock underlying awards that are forfeited under the 2010 Plan on or after June 2, 2016 will become available for issuance under the 2014 Plan.

As of December 31, 2024, the Company also had awards outstanding under the Assembly Biosciences, Inc.

Shares of common stock underlying awards forfeited under the 2010 Plan on or after June 2, 2016 become available for issuance under the 2014 Plan.

As of December 31, 2025, the Company also had awards outstanding under the following plans that are not approved by shareholders:

the Assembly Biosciences, Inc.

2017 Inducement Award Plan, the Assembly Biosciences, Inc.

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2020 Inducement Award Plan.

The Company issues new shares of common stock to settle options exercised or vested RSUs.

The Company also issues new shares of common stock in connection with purchases of shares of common stock by eligible employees under the Assembly Biosciences, Inc.

Second Amended and Restated Employee Stock Purchase Plan (the 2018 ESPP).

In February 2024, the Reverse Stock Split became effective.

All outstanding stock options and restricted stock units presented have been adjusted to reflect the 1-for-12 Reverse Stock Split.

The Company issues new shares of common stock to settle options exercised and vested RSUs or PSUs.

The Company also issues new shares of common stock in connection with purchases of shares of common stock by eligible employees under the ESPP.

Stock Plan Activity

Stock Options

The following table summarizes the stock option activity and related information for 2024:

The following tables summarize the stock option activity and related information for 2025 (in thousands, except for share and per share amounts):

Outstanding as of December 31, 2024

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Options expected to vest as of December 31, 2025

The weighted-average grant-date fair value of options granted was $ 10.04 and $ 7.68 during the years ended December 31, 2024 and 2023, respectively.

The intrinsic value of options exercised was not material during the year ended December 31, 2024 .

There were no options exercised in 2023.

The following table summarizes RSU activity and related information for 2024:

Value Per RSU

at Grant Price

Nonvested as of December 31, 2023

Nonvested as of December 31, 2024

The total fair value of RSUs vested and settled during 2024 and 2023 was $ 2.2 million and $ 2.8 million , respectively.

The total intrinsic value of RSUs vested and settled during 2024 and 2023 was $ 0.7 million and $ 0.5 million , respectively.

In July 2021, the Company granted 26,981 RSUs with performance-based vesting conditions upon the achievement of clinical milestones to the majority of employees, including executive officers.

The awards had a grant date fair value of $ 1.2 million and vested upon achievement of performance conditions fully met by December 31, 2023 .

The Company did no t recognize any stock-based compensation expense for these RSUs during the year ended December 31, 2024 , compared to $ 0.3 million during the year ended December 31, 2023 .

All awards were fully vested with no remaining unrecognized compensation cost as of December 31, 2023.

In March 2022, the Company granted 21,248 RSUs with market-based vesting conditions to members of management, including its executive officers.

The awards had a grant date fair value of $ 0.4 million and were recognized over the derived service period of 1.5 years and vest upon the achievement of certain market-based conditions which have not been achieved as of December 31, 2024.

The Company did no t recognize any stock-based compensation expense for these RSUs during the year ended December 31, 2024 , compared to $ 0.1 million for these RSUs during the year ended December 31, 2023.

In August 2022, the Company granted 43,748 RSUs with performance-based vesting conditions upon the achievement of clinical milestones to its executive officers.

The awards had a grant date fair value of $ 1.1 million and vested upon achievement of performance conditions fully met by December 31, 2024.

The Company recognized stock-based compensation expense of $ 0.1 million and $ 0.6 million for these RSUs during the years ended December 31, 2024 and 2023, respectively.

All awards were fully vested with no unrecognized compensation cost as of December 31, 2024.

Employee Stock Purchase Plan

In May 2024, the Company's stockholders approved an amendment to the 2018 ESPP, which increased the aggregate number of shares of common stock available for purchase by employees up to an aggregate of 226,398 shares at a discount to the market price.

Eligible employees may participate through payroll deductions of up to 15 % of such employee’s compensation for each pay period subject to annual statutory limits.

Eligible employees can purchase the Company’s common stock at the end of a predetermined offering period at 85 % of the lower of the fair market value at the beginning or end of the offering period.

Under the 2018 ESPP, the offering periods end on the last business day occurring on or before May 14 or November 14.

The ESPP is compensatory and results in stock-based compensation expense.

In May and November 2024, employees purchased 7,252 and 7,685 shares of common stock, respectively, under the 2018 ESPP.

In May and November 2023, employees purchased 7,534 and 6,919 shares of common stock, respectively, under the 2018 ESPP.

As of December 31, 2024, 156,815 shares of common stock are available for future sale under the Company’s 2018 ESPP.

Stock-based compensation expense recorded in connection with the 2018 ESPP was $ 0.1 million for both the years ended December 31, 2024 and 2023.

Valuation Assumptions

A summary of the assumptions used to estimate the fair values of stock options grants for the years presented is as follows:

Year Ended December 31,

Weighted-average grant-date fair value of options granted

Total intrinsic value of options exercised

The fair value of stock options granted during the periods indicated was estimated using the Black-Scholes option pricing model, based on the following assumptions:

Year Ended December 31,

Exercise price

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Expected dividend yield

The fair value of ESPP purchase rights and stock appreciation rights were not material for any period presented.

The following tables summarize RSU activity and related information for 2025 (in thousands, except for share and per share amounts):

Value Per RSU

at Grant Price

Nonvested as of December 31, 2024

Nonvested as of December 31, 2025

Year Ended December 31,

Total fair value of RSUs vested and settled

Total intrinsic value of RSUs vested and settled

The following tables summarize PSU activity and related information for 2025 (in thousands, except for share and per share amounts):

Value Per PSU

at Grant Price

Nonvested as of December 31, 2024

Nonvested as of December 31, 2025

Year Ended December 31,

Total fair value of PSUs vested and settled

Total intrinsic value of PSUs vested and settled

In June 2025, the Company's stockholders approved an amendment to the ESPP, which increased the aggregate number of shares of common stock available for purchase by employees up to 225,000 shares at a discount to the market price.

Eligible employees may participate through payroll deductions of up to 15 % of such employee’s compensation for each pay period subject to annual statutory limits.

Under the ESPP, the offering periods end on the last business day occurring on or before May 14 or November 14.

The ESPP is compensatory and results in stock-based compensation expense.

In May and November 2025, employees purchased 34,696 and 34,624 shares of common stock, respectively, under the ESPP.

In May and November 2024, employees purchased 7,252 and 7,685 shares of common stock, respectively, under the ESPP.

As of December 31, 2025, 86,097 shares of common stock are available for future sale under the Company’s ESPP.

The fair value of ESPP purchase rights were not material for any period presented.

Stock-Based Compensation Expense

The Company recognized stock-based compensation expense included in the consolidated statement of operations and comprehensive loss for the years presented (in thousands):

The Company recognized stock-based compensation expense included in the consolidated statement of operations and comprehensive loss for the years presented (in thousands), classified by expense type and award type:

Year Ended December 31,

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Total stock-based compensation expense

As of December 31, 2024, there was $ 2.3 million of total unrecognized stock-based compensation related to outstanding equity awards which is expected to be recognized over a weighted average remaining amortization period of 1.6 years.

Note 8 - Collaboration Agreements

The following table summarizes the collaboration revenue recognized from the Company's collaboration agreements in the consolidated statement of operations and comprehensive loss for the years presented (in thousands):

Year Ended December 31,

Gilead (a related party)

BeiGene, Ltd.

Total collaboration revenue

The following tables present changes in the Company’s contract liabilities (in thousands):

Year Ended December 31, 2024

Contract liabilities:

Deferred revenue

Stock options

Total stock-based compensation expense

As of December 31, 2025, there was $ 4.6 million of total unrecognized stock-based compensation cost related to outstanding unvested equity awards, which is expected to be recognized over a weighted average remaining amortization period of 1.3 years.

Note 8 - Collaboration Agreements

The following table presents changes in the Company’s contract liabilities under the Gilead Agreements (in thousands):

Year Ended December 31,

Contract liabilities:

Deferred revenue

Deferred revenue balance at beginning of period

Cash received

Accounts receivable from collaboration with a related party

Premium on purchase of the Company's common stock

Revenue recognized

Deferred revenue balance at end of period

current portion

Deferred revenue from a related party - long-term

Year Ended December 31,

Collaboration revenue recognized in the period from

Amounts included in deferred revenue at the beginning of the period

Collaboration revenue from a related party recognized in the period from:

Amounts included in deferred revenue from a related party at the beginning of the period

Performance obligations satisfied in previous period

Gilead Agreement

Gilead Agreements

In October 2023, the Company entered into the Gilead Collaboration Agreement and the Gilead Equity Agreements under which it received total proceeds of $ 100.0 million.

Under the Gilead Collaboration Agreement, Gilead exclusively licensed to the Company its HPI program and NNPI program, while retaining opt-in rights to these programs and has an option to take an exclusive license, on a program-by-program basis, to all of the Company’s other current and future pipeline programs.

During the 12-year collaboration term (subject to payment of certain extension fees) and for a specified period thereafter, Gilead may exercise its opt-in rights, on a program-by-program basis, at one of two timepoints—completion of a certain Phase 1 study or completion of a certain Phase 2 study for

the first product within the program—upon payment of an opt-in fee ranging from $ 45.0 million to $ 125.0 million per program depending on the type of program and when the option is exercised.

During the 12-year collaboration term (subject to payment of certain

extension fees) and for a specified period thereafter, Gilead may exercise its opt-in rights, on a program-by-program basis, at one of two timepoints—completion of a certain Phase 1 study or, upon payment of a deferral fee and completion of a certain Phase 2 study for the first product within the program—upon payment of an opt-in fee ranging from $ 45.0 million to $ 125.0 million per program depending on the type of program and when the option is exercised.

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The $ 10.0 million payment received in connection with the First Amendment to the Gilead Collaboration Agreement is creditable towards future collaboration-related payments payable by Gilead.

This credit was applied toward Gilead's opt-in fee paid for the HPI program in December 2025.

The letter agreement does not amend any terms of the Gilead Collaboration Agreement.

If Gilead exercises its opt-in right to any current or future program under the collaboration, the Company is eligible to receive up to $ 330.0 million in potential regulatory and commercial milestones on that program, in addition to royalties ranging from the high single-digits to high teens, depending on the clinical stage of the program at the time of the opt-in.

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Prior to Gilead’s potential exercise of its opt-in, the Company will be primarily responsible for all discovery, research and development on its programs and the two Gilead-contributed programs.

Following Gilead’s opt-in, Gilead will control the further discovery, research, development, and commercialization on any optioned programs.

During the term, Gilead will continue to support the collaboration through extension fees of $ 75.0 million in each of the third, fifth and seventh years of the collaboration.

Following Gilead’s opt-in, Gilead will control the further discovery, research, development, and commercialization on any optioned programs , and is responsible for all related costs unless the Company opts in to share 40 % of all costs and profits in the United States.

During the term, Gilead will continue to support the collaboration through extension fees of $ 75.0 million in each of the third, fifth and seventh anniversaries of the collaboration.

The Gilead Collaboration Agreement is subject to termination by either party for the other party’s uncured, material breach or insolvency.

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None of the options in the contract were deemed to be separate performance obligations as the options did not provide any discounts or other rights which would be considered a material right in the arrangement.

The Company determined the Gilead Collaboration Agreement and Gilead Equity Agreements should be assessed as a single combined transaction because the agreements were negotiated and entered into together, with a single commercial objective.

The Company accounted for the agreements based on the fair values of the assets and services exchanged.

Of the $ 15.2 million in proceeds received under the Gilead Equity Agreements in October 2023, $ 5.9 million was determined to be a premium on the purchase of the Company’s common stock and allocated to the single combined performance obligation under the Gilead Collaboration Agreement.

The value the Company received from the licenses Gilead contributed were not material within the context of the contract and accordingly, the Company made no adjustments to the transaction price for them at the commencement of the arrangement.

In December 2024, Gilead exercised its right under the Gilead Equity Agreements to purchase additional shares of the Company's common stock for aggregate proceeds of $ 20.1 million, of which $ 5.2 million was determined to be a premium on the purchase of the Company’s common stock and allocated to the single combined performance obligation under the Gilead Collaboration Agreement.

The Company determined the First Amendment to the Gilead Collaboration Agreement represents a contract modification within the scope of the revenue from contracts with customers guidance.

The Company concluded there continues to be a single combined performance obligation consisting of a series of distinct R&D Services, and therefore, the remaining services under the First Amendment to the Gilead Collaboration Agreement are distinct from the R&D Services already provided.

Accordingly, the Company accounted for the First Amendment to the Gilead Collaboration Agreement as a termination of the existing contract and the creation of a new contract and is recognizing the revenue prospectively by reassessing the transaction price and allocating it to the remaining R&D Services.

The amended transaction price as a result of the modification was determined to be $ 74.2 million , consisting of the unrecognized portion of the transaction price under the original contract, the premium of $ 5.2 million on Gilead's purchase of the Company's common stock in December 2024 and $ 10.0 million received from Gilead pursuant to the First Amendment to the Gilead Collaboration Agreement.

The variable consideration related to the regulatory and commercial milestones has not been included in the transaction price as of December 31, 2024, since Gilead has not opted in to take a license to any of the Company's programs.

Any variable consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur pursuant to the Gilead Collaboration Agreement.

premium on the purchase of the Company’s common stock and allocated to the single combined performance obligation under the Gilead Collaboration Agreement.

In December 2024, the Company determined the First Amendment to the Gilead Collaboration Agreement represented a contract modification within the scope of the revenue from contracts with customers guidance.

In July 2025, upon its execution, the Company similarly concluded the letter agreement represented a contract modification under the same guidance.

For both modifications, the Company determined no new distinct performance obligations were introduced, there continues to be a single combined performance obligation consisting of a series of distinct R&D Services, and therefore, the remaining services under the modified Gilead Collaboration Agreement are distinct from the R&D Services already provided.

Accordingly, the Company accounted for each modification as a termination of the existing contract and the creation of a new contract.

The Company reassessed the transaction price upon each modification and recognized revenue prospectively by reassessing the transaction price and allocating it to the remaining R&D Services.

The amended transaction price as a result of the modification upon entering into the letter agreement in July 2025 was determined to be $ 54.4 million , consisting of the unrecognized portion of the transaction price under the contract immediately before the modification and $ 1.5 million of variable consideration for reimbursable costs expected to be incurred pursuant to the letter agreement.

The variable consideration related to the regulatory milestones has not been included in the transaction price as of December 31, 2025, as these amounts remain highly susceptible to factors outside the Company's influence.

Any variable consideration related to commercial milestones and royalties will be recognized when the related sales occur pursuant to the Gilead Collaboration Agreement.

The Company will reevaluate the transaction price in each reporting period as uncertain events are resolved or other changes in circumstances occur.

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A significant change in these assumptions and estimates could have a material impact on the timing and amount of revenue recognized in future periods.

The Company recognized $ 28.5 million and $ 4.4 million of collaboration revenue under the Gilead Collaboration Agreement during the years ended December 31, 2024 and 2023, respectively.

The transaction price for future collaborative activities was recorded as deferred revenue on the consolidated balance sheet as of December 31, 2024, of which $ 37.6 million was included in deferred revenue - short-term and $ 35.4 million was included in deferred revenue - long-term.

During the year ended December 31, 2024, the Company incurred $ 0.3 million in reimbursable expenses due to Gilead.

During the year ended December 31, 2023 , the Company did no t incur any reimbursable expenses due to Gilead.

The Company recognized $ 37.3 million and $ 28.5 million of collaboration revenue for R&D Services performed under the Gilead Collaboration Agreement during the years ended December 31, 2025 and 2024, respectively.

The Company incurred $ 0.1 million and $ 0.3 million in reimbursable expenses due to Gilead during the years ended December 31, 2025 and 2024, respectively.

HPI Program License

In December 2025, Gilead exercised its option to exclusively license the Company's HPI program for the treatment of recurrent genital herpes, including 5366 and 1179.

Under the terms of the Gilead Collaboration Agreement, the Company received a $ 35.0 million payment in connection with Gilead’s exercise of its HPI program.

The $ 35.0 million payment reflects a $ 45.0 million option fee, net of $ 10.0 million in accelerated funding the Company received under the First Amendment to the Gilead Collaboration Agreement, which was creditable against future payments.

Gilead received an exclusive license to 5366 and 1179 and will have the sole right and responsibility for further clinical development and commercialization of the HPI program.

The Company remains eligible to receive up to $ 330.0 million in regulatory and commercial milestones, as well as tiered royalties on net sales ranging from the high single-digits to low teens.

The Company also has the right to opt in to share 40 % of all costs and profits in the United States (the Profit-Share) in lieu of receiving milestones and royalties for that program in the United States after receipt of a development plan and budget from Gilead;

The Company has not opted into the Profit-Share as of the date of this report.

The Company determined the exclusive license granted to Gilead for the HPI program was a new contract under the contracts from customers accounting standard as it was deemed an exercise of a marketing offer made pursuant to the original terms of the Gilead Collaboration Agreement and First Amendment.

The Company concluded the exclusive license granted to Gilead for the HPI program represents a distinct performance obligation because Gilead can benefit from the license together with readily available resources and its ability to sublicense the rights.

The $ 35.0 million opt-in fee is included in the fixed transaction price.

Variable consideration related to regulatory and commercial milestone payments, royalties and cost reimbursements are constrained because such amounts are highly susceptible to factors outside the Company's influence.

The Company recognized $ 35.0 million of collaboration revenue related to the exclusive license granted for the HPI program at a point in time upon transfer of the license, when Gilead obtained the ability to use and benefit from the license, during the year ended December 31, 2025.

Arbutus Biopharma Agreement

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During the year ended December 31, 2024, the Company recognized research and development expenses of $ 0.3 million for net amounts refundable to Arbutus Biopharma after the final reconciliation of clinical trial costs.

Amounts refundable to Arbutus Biopharma are recorded as accrued research and development expenses on the consolidated balance sheet as of December 31, 2024.

During the year ended December 31, 2023, the Company recognized a reduction of research and development expense of $ 1.6 million under the Arbutus Biopharma Agreement.

BeiGene Agreement

In July 2020, the Company and BeiGene entered into a Collaboration Agreement (the BeiGene Agreement) to develop and commercialize the Company’s novel core inhibitor product candidates vebicorvir (VBR), ABI-H2158 (2158) and ABI-H3733 (3733) for chronic HBV infection (the Licensed Product Candidates) in the People’s Republic of China, Hong Kong, Taiwan and Macau (the Territory).

Under the agreement, the Company and BeiGene collaborated on certain global clinical studies and both the Company and BeiGene would independently conduct other clinical studies in their own respective territories.

During the term of the BeiGene Agreement, neither party will commercialize any competing products in the Territory.

Pursuant to the terms of the BeiGene Agreement, the Company received an upfront cash payment of $ 40.0 million from BeiGene for the delivery of exclusive, royalty-bearing licenses to develop and commercialize the Licensed Product Candidates in the Territory, and the Company was eligible to receive up to approximately $ 500.0 million in cash milestone payments and tiered royalties on net sales.

In conjunction with the Company entering into the Gilead Collaboration Agreement with Gilead in October 2023, the Company discontinued further development of 3733 leaving no remaining products in development which have been licensed to BeiGene.

Due to the discontinuation of development of all Licensed Product Candidates, the Company is not eligible to receive any development and regulatory milestones or net sales milestones.

The Company had no further performance obligations under the BeiGene Agreement following the discontinuation of development of 3733.

Accordingly, the Company recognized the remaining contract liability of $ 2.7 million as collaboration revenue during the year ended December 31, 2023.

The Company also recognized the remaining $ 0.2 million unamortized incremental costs of obtaining the BeiGene Agreement as general and administrative expenses during the year ended December 31, 2023 .

No revenue or amortization was recognized during the year ended December 31, 2024 .

Note 9 – Strategic License Agreements

HBV Research Agreement with Indiana University

Since September 2013, the Company was party to an exclusive License Agreement dated September 3, 2013 with Indiana University Research and Technology Corporation (IURTC) from whom it licensed aspects of the Company’s HBV program held by IURTC.

Amounts refundable to Arbutus Biopharma were recorded as accrued research and development expenses on the consolidated balance sheet as of December 31, 2024.

Note 9 – HBV Research Agreement with Indiana University

Since September 2013, the Company was party to an exclusive License Agreement with Indiana University Research and Technology Corporation (IURTC) from whom it licensed aspects of the Company’s HBV program held by IURTC.

The license agreement required the Company to make milestone payments based upon the successful accomplishment of clinical and regulatory milestones.

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The Company was also required to pay diligence maintenance fees each year to the extent that the royalty, sublicensing, and milestone payments to IURTC were less than such fees for that year.

Following its decision to discontinue further development of 3733, the Company terminated the IURTC license agreement effective April 2024.

The Company paid IURTC $ 0.1 million in diligence maintenance fees during both the years ended December 31, 2024 and 2023, which are included in research and development expenses in the consolidated statements of operations and comprehensive loss.

Microbiome Purchase Agreement

In December 2021, the Company entered into an asset purchase agreement (the Microbiome Purchase Agreement) with a third party pursuant to which the Company sold know-how, patents, materials and regulatory filings for the Company’s Microbiome program.

The Company is entitled to receive a $ 10.0 million milestone payment upon the achievement of a regulatory approval milestone as defined in the purchase agreement.

The variable consideration relating to the $ 10.0 million milestone has not been included in the transaction price as it was fully constrained as of December 31, 2024 and 2023 .

As part of the Company’s evaluation of the development milestone constraint, it determined the achievement of the milestone is contingent upon success in future clinical studies and regulatory approvals which are not within its control and uncertain at this stage.

The Company terminated the IURTC license agreement effective April 2024.

The Company paid IURTC $ 0.1 million in diligence maintenance fees during the year ended December 31, 2024 , which were included in research and development expenses in the consolidated statements of operations and comprehensive loss.

Note 10 - Income Taxes

Income tax expense is as follows (in thousands):

Year Ended December 31,

Income tax expense

The Company adopted ASU 2023-09 prospectively for the year ended December 31, 2025.

Prior period disclosures have not been retrospectively adjusted and may not be comparable to the current year presentation under the new standard.

The reconciliation between the federal statutory tax rate applied to loss before income taxes and the Company's effective tax rate is summarized as follows (in thousands, except percentages):

Year Ended December 31,

Tax computed at federal statutory rate

State tax, net of federal income tax effect (1)

Non-taxable or nondeductible items:

Permanent items

Covered employee compensation

Share-based payment awards

Changes in valuation allowance

Federal research and development tax credits

Changes in unrecognized tax benefits

Income tax expense / Effective tax rate

(1) State taxes in California comprise the majority (greater than 50.0%) of the tax effect in this category.

The effective tax rate of the Company's provision for income taxes differs from the federal statutory rate as follows:

As of December 31,

Year Ended December 31,

Statutory federal income tax rate

6 unchanged sentences

Income taxes provision (benefit)

Income taxes paid, net of refunds received, were not material during the year ended December 31, 2025 .

The Company paid $ 0.4 million of income taxes during the year ended December 31, 2024.

Significant components of the Company’s deferred taxes are as follows (in thousands):

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The Company maintains a valuation allowance on deferred tax assets due to the uncertainty regarding the ability to utilize these deferred tax assets in the future.

The valuation allowance increased by $ 9.2 million and $ 18.4 million for the years ended December 31, 2024 and 2023, respectively, primarily due to an increase in the Company’s federal and state-operating loss carryforwards.

The valuation allowance decreased by $ 36.5 million for the year ended December 31, 2025, primarily due to a reduction in the Company's research and development credits and federal and state net operating loss carryforwards resulting from an ownership change under Internal Revenue Code (IRC) Sections 382 and 383 (see below).

The valuation allowance increased by $ 9.2 million for the year ended December 31, 2024, primarily due to an increase in the Company’s federal and state net operating loss carryforwards generated during the year.

Net operating loss and tax credit carryforwards as of December 31, 2025 are as follows (in thousands):

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Research and development tax credits, state

Pursuant to Internal Revenue Code (IRC), Sections 382 and 383, use of the Company’s U.S.

Pursuant to IRC Sections 382 and 383, use of the Company’s U.S.

federal and state net operating loss and research and development income tax credit carryforwards may be limited in the event of a cumulative change in ownership of more than 50% within a three-year period.

The Company has performed an ownership change study through December 31, 2024 and has determined a “change in ownership” as defined by IRC Section 382 and the rules and regulations promulgated thereunder, did occur in December 2010, January 2013 and October 2014.

The Company has adjusted its net operating loss carryovers to appropriately reflect any attributes which will expire due to the limitation.

If further changes in ownership occur, additional net operating loss and tax credit carryforwards could be eliminated or restricted.

If eliminated, the related asset would be removed from the deferred tax asset schedule with a corresponding reduction in the valuation allowance.

The Company performed an ownership change study through August 2025 and determined a change in ownership, as defined by IRC Section 382, occurred in December 2010, January 2013, October 2014 and August 2025.

As a result, the Company adjusted its federal and California deferred tax assets for net operating loss and research and development carryforwards to reflect attributes which will expire due to the limitation, with a corresponding change to the valuation allowance recorded against such assets.

The Company has not completed a similar analysis with respect to its other remaining state net operating loss carryforwards, which totaled $ 224.1 million as of December 31, 2025, and accordingly, it is possible additional limitations or expirations exist that have not yet been reflected.

If further ownership changes occur, additional net operating loss and tax credit carryforwards could be eliminated or restricted.

If eliminated, the related deferred tax asset would be removed with a corresponding reduction in the valuation allowance.

The following table summarizes activity related to the Company’s gross unrecognized tax benefits (in thousands):

1 unchanged sentence

Balances as of beginning of year

Increases related to prior year tax positions

Decreases related to prior year tax positions

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In subsequent periods, any interest and penalties related to uncertain tax positions will be recognized as a component of income tax expense.

Interest and penalties related to unrecognized tax benefits were not material for the years ended December 31, 2025 and 2024.

The Company files income tax returns in the U.S.

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and states in which the Company files tax returns.

Note 11 - Leases

Operating Leases

Note 11 - Operating Leases

In August 2023, the Company entered into a sublease agreement for office and laboratory space in South San Francisco, California to serve as the Company's corporate headquarters.

1 unchanged sentence

In December 2024, the Company amended the sublease to extend the term through September 2029 and modify the base rent payments beginning in January 2025, with scheduled annual rent increases over the remaining lease term.

The Company's previous corporate headquarters sub-sublease in South San Francisco, California expired in December 2023.

The Company also leased office space in Carmel, Indiana under a lease agreement that expired in August 2023, which had been substantially subleased since February 2021.

The Company dissolved its China subsidiary in 2024, allowing the lease for its registrational office in Shanghai to expire in March 2024.

The lease for the Company's registrational office in Beijing, which was month-to-month, ended in 2023.

The Company also leases certain laboratory equipment accounted for as operating leases expiring at various dates, with the final lease expiring in 2025.

The Company also leased certain laboratory equipment accounted for as operating leases, the last of which expired in 2025.

When the Company cannot determine the implicit rate in its leasing arrangements, the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities.

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Variable lease cost

Sublease income

Total lease cost, net

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The Plan also permits the Company to make discretionary matching contributions.

During both the years ended December 31, 2024 and 2023, the Company made discretionary matching contributions of $ 0.7 million .

The Company made discretionary matching contributions of $ 0.8 million and $ 0.7 million for the Plan during the years ended December 31, 2025 and 2024 , respectively.

Note 13 - Segment Reporting

6 unchanged sentences

These expenses are reviewed by the CODM on a consolidated basis as part of evaluating the Company's overall financial performance.

During the years ended December 31, 2024 and 2023, the Company generated all of its collaboration revenue from two customers, one of which is a related party (see Notes 3 - Related Party and 8 - Collaboration Agreements).

During the years ended December 31, 2025 and 2024, the Company generated all of its collaboration revenue from Gilead, who is a related party (see Notes 3 - Related Party and 8 - Collaboration Agreements).

For the years ended December 31, 2025 and 2024, all of the Company's revenue and long-lived assets were in the United States.

The following table presents the significant segment expenses and other segment items regularly reviewed by the Company's CODM:

Years Ended December 31,

Collaboration revenue ($ 28,520 and $ 4,430 from a related party)

Year Ended December 31,

Collaboration revenue from a related party

External program expenses:

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General and administrative (3)

Other segment items (3)

Interest and other income, net

Income tax expense

(1) In October 2025, the Company transitioned its discovery and development from ABI-7423 to its parent molecule, ABI-7272, which is currently in regulatory filing-enabling preclinical studies.

(2) Reflects net amounts refundable to the Company after the final reconciliation of costs of the clinical trial conducted pursuant to the Arbutus Biopharma Agreement, which was terminated in February 2023.

(3) Includes stock-based compensation expense, see Note 7 - Stock-Based Compensation for further details.

(3) Other segment items include interest and other income, net, and income tax expense as reported in the Company's consolidated statements of operations and comprehensive loss.

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-K

Item 9A. Controls and Procedures