What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-11 compared with 2026-05-11 · 136 added, 72 removed, 421 unchanged (33% of the section changed)

23 unchanged sentences

Preferred stock, $ 0.0001 par value;

80,000,000 shares authorized at March 31, 2026 and December 31, 2025;

no shares issued and outstanding at March 31, 2026 and December 31, 2025

80,000,000 shares authorized at June 30, 2026 and December 31, 2025;

no shares issued and outstanding at June 30, 2026 and December 31, 2025

Common stock, $ 0.0001 par value;

800,000,000 shares authorized at March 31, 2026 and December 31, 2025;

310,806,888 and 284,159,076 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively

800,000,000 shares authorized at June 30, 2026 and December 31, 2025;

312,556,206 and 284,159,076 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively

Additional paid-in capital

6 unchanged sentences

(In thousands, except share and per share amounts)

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Operating expenses:

6 unchanged sentences

Interest income

Other income (expense), net

Other expense, net

Total other income (expense), net

16 unchanged sentences

Balance at March 31, 2026

Exercise of stock options

Issuance of common stock under the Employee Stock Purchase Plan

Stock-based compensation expense

Unrealized loss on marketable securities, net

Balance at June 30, 2026

Comprehensive

6 unchanged sentences

Balance at March 31, 2025

Exercise of stock options

Issuance of common stock under the Employee Stock Purchase Plan

Stock-based compensation expense

Unrealized loss on marketable securities, net

Balance at June 30, 2025

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

1 unchanged sentence

(In thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

21 unchanged sentences

Issuance costs associated with underwritten offering

Payments of deferred offering costs

Proceeds from the exercise of stock options

Proceeds from issuance of common stock under the Employee Stock Purchase Plan

Net cash provided by financing activities

Net (decrease) increase in cash, cash equivalents, and restricted cash

Net decrease in cash, cash equivalents, and restricted cash

Cash, cash equivalents, and restricted cash at beginning of the period

Cash, cash equivalents, and restricted cash at end of the period

Supplemental disclosure of noncash investing and financing activities:

Amounts accrued for in-process research and development

Amounts accrued for deferred offering costs

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

11 unchanged sentences

(ASN) (the Asana Merger Agreement), pursuant to which ASN became the Company's wholly-owned subsidiary.

In March 2021, the Company established a wholly-owned subsidiary, Erasca Ventures, LLC (Erasca Ventures), to make equity investments in early-stage biotechnology companies that are aligned with the Company’s mission and strategy.

In March 2021, the Company established a wholly-owned subsidiary, Erasca Ventures, LLC (Erasca Ventures), to make investments in early-stage biotechnology companies that are aligned with the Company’s mission and strategy.

Since inception, the Company has devoted substantially all of its efforts and resources to organizing and staffing the Company, business planning, raising capital, identifying, acquiring, and in-licensing the Company’s product candidates, establishing its intellectual property portfolio, conducting research, preclinical studies, and clinical trials, establishing arrangements with third parties for the manufacture of its product candidates and related raw materials, and providing general and administrative support for these operations.

As of March 31, 2026, the Company had $ 408.5 million in cash, cash equivalents, and marketable securities.

As of March 31, 2026, the Company had an accumulated deficit of $ 1.1 billion.

As of June 30, 2026, the Company had $ 384.3 million in cash, cash equivalents, and marketable securities.

As of June 30, 2026, the Company had an accumulated deficit of $ 1.1 billion.

The Company has incurred significant operating losses and negative cash flows from operations.

From its inception through March 31, 2026, the Company’s financial support has primarily been provided from the sale of its convertible preferred stock and the sale of its common stock in its initial public offering (IPO), underwritten offerings, a private placement of common stock, and "at the market" offerings.

From its inception through June 30, 2026, the Company’s financial support has primarily been provided from the sale of its convertible preferred stock and the sale of its common stock in its initial public offering (IPO), underwritten offerings, a private placement of common stock, and "at the market" offerings.

The Company expects to use its cash, cash equivalents, and marketable securities to fund research and development, working capital, and other general corporate purposes.

3 unchanged sentences

The Company’s failure to raise capital or enter into such other arrangements when needed would have a negative impact on the Company’s financial condition and could force the Company to delay, limit, reduce, or terminate its research and development programs or other operations, or grant rights to develop and market product candidates that the Company would otherwise prefer to develop and market itself.

The Company believes its cash, cash equivalents, and marketable securities as of March 31, 2026 will be sufficient for the Company to fund operations for at least one year from the issuance date of these condensed consolidated financial statements.

The Company believes its cash, cash equivalents, and marketable securities as of June 30, 2026 , together with the net proceeds of $ 593.5 million received from the Company's underwritten offering, which closed in July 2026, will be sufficient for the Company to fund operations for at least one year from the issuance date of these condensed consolidated financial statements.

July 2026 underwritten offering

In July 2026, the Company completed the sale and issuance of 36,142,857 shares of its common stock, including the exercise in full by the underwriters of their option to purchase 4,714,285 shares of its common stock, at a price to the public of $ 17.50 per share (the July 2026 Offering).

The aggregate net proceeds from the July 2026 Offering were $ 593.5 million, net of underwriting discounts and commissions and estimated offering costs of $ 38.9 million.

Basis of presentation

11 unchanged sentences

Unaudited interim financial information

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

The unaudited condensed consolidated interim financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s condensed consolidated financial position as of March 31, 2026 and the condensed consolidated results of its operations and cash flows for the three months ended March 31, 2026 and 2025.

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

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

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

The unaudited condensed consolidated interim financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s condensed consolidated financial position as of June 30, 2026 and the condensed consolidated results of its operations and cash flows for the three and six months ended June 30, 2026 and 2025.

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

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

These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on March 12, 2026 .

7 unchanged sentences

The Company considers all highly liquid investments with an original maturity of three months or less from the date of purchase to be cash equivalents.

The Company had deposited cash of $ 408,000 as of March 31, 2026 and December 31, 2025 to secure a letter of credit in connection with the lease of the Company’s facilities (see Note 10).

The Company had deposited cash of $ 408,000 as of June 30, 2026 and December 31, 2025 to secure a letter of credit in connection with the lease of the Company’s facilities (see Note 10).

The Company has classified the restricted cash as a noncurrent asset on its condensed consolidated balance sheets.

45 unchanged sentences

The following tables summarize the Company’s financial assets measured at fair value on a recurring basis and their respective input levels based on the fair value hierarchy (in thousands):

Fair value measurements as of March 31, 2026 using

Fair value measurements as of June 30, 2026 using

Quoted prices in

4 unchanged sentences

Money market funds (1)

Commercial paper (1)

US treasury securities (2)

31 unchanged sentences

The following tables summarize the Company’s marketable securities accounted for as available-for-sale securities (in thousands, except years):

March 31, 2026

June 30, 2026

US treasury securities

10 unchanged sentences

US government agency securities

The following table presents fair values and gross unrealized losses for those available-for-sale securities that were in an unrealized loss position as of March 31, 2026, aggregated by category and the length of time that the securities have been in a continuous loss position (in thousands):

March 31, 2026

The following table presents fair values and gross unrealized losses for those available-for-sale securities that were in an unrealized loss position as of June 30, 2026, aggregated by category and the length of time that the securities have been in a continuous loss position (in thousands):

June 30, 2026

Unrealized losses less than 12 months

7 unchanged sentences

Commercial paper

As of March 31, 2026, there were 44 available-for-sale securities with an estimated fair value of $ 258.3 million in gross unrealized loss positions, none of which were in an unrealized loss position for more than 12 months.

As of June 30, 2026, there were 50 available-for-sale securities with an estimated fair value of $ 288.7 million in gross unrealized loss positions, none of which were in an unrealized loss position for more than 12 months.

A s of December 31, 2025 , there were no available-for-sale securities that were in an unrealized loss position.

As of March 31, 2026, unrealized losses on available-for-sale securities are not attributed to credit risk.

As of June 30, 2026, unrealized losses on available-for-sale securities are not attributed to credit risk.

The Company believes that an allowance for credit losses is unnecessary because the unrealized losses on certain of the Company’s available-for-sale securities are due to market factors and changes in interest rates.

Additionally, the Company does not intend to sell the securities nor is it more likely than not that the Company will be required to sell the securities before recovery of their amortized cost basis.

Accrued interest on the Company’s available-for-sale securities was $ 3.3 million and $ 2.5 million as of March 31, 2026 and December 31, 2025 , respectively, and is included in prepaid expenses and other current assets on the condensed consolidated balance sheets.

Accrued interest on the Company’s available-for-sale securities was $ 2.5 million as of June 30, 2026 and December 31, 2025 and is included in prepaid expenses and other current assets on the condensed consolidated balance sheets.

Property and equipment, net

7 unchanged sentences

Property and equipment, net

Depreciation and amortization expense related to property and equipment was $ 723,000 and $ 822,000 for the three months ended March 31, 2026 and 2025 , respectively.

Depreciation and amortization expense related to property and equipment was $ 716,000 and $ 1.4 million for the three and six months ended June 30, 2026 , respectively, and $ 787,000 and $ 1.6 million for the three and six months ended June 30, 2025 , respectively.

Accrued expenses and other current liabilities

3 unchanged sentences

Accrued professional services

Accrued deferred offering costs

Other accruals and current liabilities

7 unchanged sentences

Under the Joyo License Agreement, in 2024, the Company made an upfront cash payment to Joyo of $ 12.5 million.

The Company is obligated to make development and regulatory milestone payments of up to $ 51.5 million (with such amount increasing to $ 57.5 million following the Company's exercise of the option to expand the Company’s territory to include mainland China, Hong Kong, and Macau) and commercial milestone payments of up to $ 125.0 million upon the achievement of the corresponding milestones.

The Company is obligated to make development and regulatory milestone payments of up to $ 57.5 million and commercial milestone payments of up to $ 125.0 million upon the achievement of the corresponding milestones.

The Company is also obligated to pay tiered royalties on net sales of all licensed products, in the low- to mid-single digit percentages, subject to certain reductions.

The Company recorded IPR&D expense of $ 150.0 million related to the Company's exercise of the option to expand its territory under the Joyo License Agreement during the three months ended March 31, 2026 .

No IPR&D expense was recorded in connection with the Joyo License Agreement during the three months ended March 31, 2025.

For the three and six months ended June 30, 2026 , the Company recorded IPR&D expense of $ 0 and $ 150.0 million, respectively, related to the Company's exercise of the option to expand its territory under the Joyo License Agreement.

For the three and six months ended June 30, 2025 , the Company recorded $ 7.5 million in IPR&D expense related to the achievement of milestones.

Medshine Discovery Inc.

5 unchanged sentences

The Company is also obligated to pay a low-single digit percentage royalty on net sales of all licensed products, subject to certain reductions.

No IPR&D expense was recorded in connection with the Medshine License Agreement during the three months ended March 31, 2026 and 2025.

No IPR&D expense was recorded in connection with the Medshine License Agreement during the three and six months ended June 30, 2026 and 2025.

Novartis Pharma AG

3 unchanged sentences

After evaluating the clinical progress of the Company’s RAS franchise, the Company made a decision to stop development of naporafenib.

In March 2026, the Company sent a notice to Novartis to terminate the Novartis Agreement.

The effective date of the termination of the Novartis Agreement is June 3, 2026 .

In connection with such termination, the Company and Novartis have agreed that the Company shall continue to ensure that the patients currently enrolled in the SEACRAFT-1 and SEACRAFT-2 trials will be permitted to continue to receive treatment for the foreseeable future.

No IPR&D expense was recorded in connection with the Novartis Agreement during the three months ended March 31, 2026 and 2025.

As of March 31, 2026 and December 31, 2025 , no milestones had been accrued for any license agreement as the underlying contingencies were not probable or estimable.

In March 2026, the Company sent a notice to Novartis to terminate the Novartis Agreement, with an effective termination date of June 3, 2026 .

In connection with such termination, the Company and Novartis entered into a termination agreement pursuant to which Novartis and the Company have agreed that the Company shall continue to ensure that the patients currently enrolled in the SEACRAFT-1 and SEACRAFT-2 trials will be permitted to continue to receive treatment for the foreseeable future.

No IPR&D expense was recorded in connection with the Novartis Agreement during the three and six months ended June 30, 2026 and 2025.

As of June 30, 2026 and December 31, 2025 , no milestones had been accrued for any license agreement as the underlying contingencies were not probable or estimable.

Stockholders' equity

1 unchanged sentence

Common stockholders are entitled to receive dividends, as may be declared by the Company’s board of directors.

As of March 31, 2026 , no dividends had been declared.

As of June 30, 2026 , no dividends had been declared.

Common stock reserved for future issuance

Common stock reserved for future issuance consisted of the following as of March 31, 2026 and December 31, 2025:

Common stock reserved for future issuance consisted of the following as of June 30, 2026 and December 31, 2025:

Stock options issued and outstanding

1 unchanged sentence

Shares available for purchase under the ESPP

2026 underwritten offering

January 2026 underwritten offering

In January 2026, the Company completed the sale and issuance of 25,875,000 shares of its common stock, including the exercise in full by the underwriters of their option to purchase 3,375,000 shares of its common stock, at a price to the public of $ 10.00 per share (the January 2026 Offering).

The aggregate net proceeds from the January 2026 Offering were $ 242.7 million, net of underwriting discounts and commissions of $ 15.5 million and offering costs of $ 519,000 .

The aggregate net proceeds from the January 2026 Offering were $ 242.7 million, net of underwriting discounts and commissions and offering costs of $ 16.0 million.

ATM offerings

2 unchanged sentences

Pursuant to the Sale Agreement, the Agent received a commission from the Company of up to 3.0 % of the gross proceeds of shares of common stock sold under the Sale Agreement.

No shares of the Company's common stock were sold under the ATM Program during the three months ended March 31, 2025.

No shares of the Company's common stock were sold under the ATM Program during the three and six months ended June 30, 2025.

In August 2025, the Company entered into an Amended and Restated Open Market Sale Agreement (the 2025 Sale Agreement) with the Agent, pursuant to which the Company may offer and sell shares of the Company’s common stock having an aggregate offering price of up to $ 200 million from time to time, in the ATM Program through the Agent.

1 unchanged sentence

The Agent will receive a commission from the Company of up to 3.0 % of the gross proceeds of any shares of common stock sold under the 2025 Sale Agreement.

As of March 31, 2026 , the Company had $ 200.0 million of shares available for sale under the ATM Program.

No shares of the Company's common stock were sold under the ATM Program during the three and six months ended June 30, 2026.

As of June 30, 2026 , the Company had $ 200.0 million of shares available for sale under the ATM Program.

Stock-based compensation

4 unchanged sentences

In addition, the number of shares of common stock available for issuance under the 2021 Plan may be increased annually on the first day of each calendar year during the term of the 2021 Plan, beginning in 2022, by an amount equal to the lesser of (i) 5 % of the shares of common stock outstanding on the final day of the immediately preceding calendar year or (ii) such smaller number of shares as determined by the Company’s board of directors or an authorized committee of the board of directors.

As of March 31, 2026, there were 16,010,142 stock-based awards available for future grant under the 2021 Plan.

As of June 30, 2026, there were 15,636,814 stock-based awards available for future grant under the 2021 Plan.

Subsequent to July 2021, no further awards will be granted under the 2018 Plan and all future stock-based awards will be granted under the 2021 Plan.

11 unchanged sentences

Outstanding at December 31, 2025

Outstanding at March 31, 2026

Options exercisable at March 31, 2026

The weighted-average grant date fair value of options granted for the three months ended March 31, 2026 and 2025 was $ 7.27 and $ 1.26 , respectively.

As of March 31, 2026, the unrecognized compensation cost related to unvested stock option grants was $ 106.4 million and is expected to be recognized as expense over approximately 2.75 years.

The intrinsic value of the options exercised for the three months ended March 31, 2026 and 2025 was $ 4.1 million and $ 74,000 , respectively.

Outstanding at June 30, 2026

Options exercisable at June 30, 2026

The weighted-average grant date fair value of options granted for the three and six months ended June 30, 2026 was $ 10.09 and $ 7.36 , respectively, and for the three and six months ended June 30, 2025 was $ 1.02 and $ 1.25 , respectively.

As of June 30, 2026, the unrecognized compensation cost related to unvested stock option grants was $ 100.8 million and is expected to be recognized as expense over approximately 2.63 years.

The intrinsic value of the options exercised for the three and six months ended June 30, 2026 was $ 13.1 million and $ 17.3 million, respectively.

The intrinsic value of the options exercised for the three and six months ended June 30, 2025 was $ 58,000 and $ 132,000 , respectively.

The assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee and nonemployee stock option grants were as follows:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Risk-free interest rate

1 unchanged sentence

3.96 %- 4.04 %

3.72 %- 4.25 %

3.96 %- 4.43 %

Expected volatility

1 unchanged sentence

80.33 %- 82.36 %

73.54 %- 81.79 %

79.48 %- 82.36 %

Expected term (in years)

2 unchanged sentences

For purposes of the Option Repricing, “Repriced Options” are 7,478,918 outstanding stock options as of May 21, 2024 (vested and unvested) granted under the 2021 Plan and held by those eligible employees of the Company identified by the Company's board of directors, excluding the Company’s Section 16 officers (the Chairman and Chief Executive Officer, the Chief Financial Officer and Chief Business Officer, the Chief Medical Officer, and the Chief Legal Officer) and the Company's board of directors.

To the extent a Repriced Option is exercised prior to the Premium End Date (as defined below), the eligible employee will be required to pay the original exercise price per share of the Repriced Options in connection with any exercise of the Repriced Option.

To the extent a Repriced Option was exercised prior to the Premium End Date (as defined below), the eligible employee was required to pay the original exercise price per share of the Repriced Options in connection with any exercise of the Repriced Option.

The “Premium End Date” means the earliest of (i) May 21, 2026;

2 unchanged sentences

or (iv) the date of the eligible employee’s termination without cause, provided that such termination without cause occurs after May 21, 2025.

Except for the reduction in the exercise prices of the Repriced Options as described above, the Repriced Options will retain their existing terms and conditions as set forth in the 2021 Plan and the applicable award agreements.

All repriced options will retain their original vesting schedule.

The Option Repricing resulted in $ 1.1 million of incremental cost, which was calculated using the Black-Scholes option pricing model, of which $ 559,000 of the incremental cost will be recognized on a straight-line basis through the Premium End Date, and $ 558,000 of the incremental cost will be recognized on a straight-line basis over the greater of the period through the Premium End Date or the remaining service period.

Except for the reduction in the exercise prices of the Repriced Options as described above, the Repriced Options retained their existing terms and conditions as set forth in the 2021 Plan and the applicable award agreements.

All repriced options retained their original vesting schedule.

The Option Repricing resulted in $ 1.1 million of incremental cost, which was calculated using the Black-Scholes option pricing model, of which $ 559,000 of the incremental cost was recognized on a straight-line basis through the Premium End Date, and $ 558,000 of the incremental cost will be recognized on a straight-line basis over the greater of the period through the Premium End Date or the remaining service period.

The incremental cost is included in general and administrative expense and research and development expense on the condensed consolidated statements of operations and comprehensive loss.

5 unchanged sentences

In addition, the number of shares of common stock available for issuance under the ESPP may be increased annually on the first day of each calendar year during the term of the ESPP, beginning in 2022, by an amount equal to the lesser of (i) 1% of the shares of common stock outstanding on the final day of the immediately preceding calendar year or (ii) such smaller number of shares as determined by the Company’s board of directors or an authorized committee of the board of directors.

The Company recognized stock-based compensation expense related to the ESPP of $ 186,000 and $ 214,000 during the three months ended March 31, 2026 and 2025, respectively.

As of March 31, 2026, the unrecognized compensation cost related to the ESPP was $ 891,000 and is expected to be recognized as expense over approximately 1.24 years.

As of March 31, 2026 and December 31, 2025, $ 464,000 and $ 67,000 has been withheld on behalf of employees for future purchase under the ESPP, respectively, and is included in accrued expenses and other current liabilities on the condensed consolidated balance sheets.

No shares were issued and sold under the ESPP during the three months ended March 31, 2026 and 2025.

The Company recognized stock-based compensation expense related to the ESPP of $ 278,000 and $ 464,000 during the three and six months ended June 30, 2026, respectively, and $ 247,000 and $ 461,000 during the three and six months ended June 30, 2025, respectively.

As of June 30, 2026, the unrecognized compensation cost related to the ESPP was $ 905,000 and is expected to be recognized as expense over approximately 1.02 years.

As of June 30, 2026 and December 31, 2025, $ 121,000 and $ 67,000 has been withheld on behalf of employees for future purchase under the ESPP, respectively, and is included in accrued expenses and other current liabilities on the condensed consolidated balance sheets.

The Company issued and sold 606,277 shares under the ESPP during the three and six months ended June 30, 2026 and 321,091 shares under the ESPP during the three and six months ended June 30, 2025.

The assumptions used in the Black-Scholes option pricing model to determine the fair value of the stock to be purchased under the ESPP were as follows:

Three Months Ended June 30,

Six Months Ended June 30,

Risk-free interest rate

3.81 %- 4.05 %

3.97 %- 4.32 %

3.81 %- 4.05 %

3.97 %- 4.32 %

Expected volatility

97.28 %- 136.99 %

76.13 %- 92.99 %

97.28 %- 136.99 %

76.13 %- 92.99 %

Expected term (in years)

Expected dividend yield

Stock-based compensation expense

The allocation of stock-based compensation for all stock awards was as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Research and development

3 unchanged sentences

Lease costs were comprised of the following (in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Operating lease cost

2 unchanged sentences

Total lease cost

The Company paid $ 1.5 million in cash for operating leases, net of cash received from subleases, that is included in the operating activities section of the condensed consolidated statements of cash flows for each of the three months ended March 31, 2026 and 2025.

The weighted-average remaining lease term and the weighted-average discount rate of the Company’s operating leases were 6.15 years and 8.99 %, respectively, at March 31, 2026 .

The Company paid $ 3.0 million and $ 3.3 million in cash for operating leases, net of cash received from subleases, that is included in the operating activities section of the condensed consolidated statements of cash flows for the six months ended June 30, 2026 and 2025, respectively.

The weighted-average remaining lease term and the weighted-average discount rate of the Company’s operating leases were 5.91 years and 8.99 %, respectively, at June 30, 2026 .

The weighted-average remaining lease term and the weighted-average discount rate of the Company’s operating leases were 6.39 years and 8.98 %, respectively, at December 31, 2025.

4 unchanged sentences

The construction and design of the asset was the primary responsibility of the lessor.

The Company was involved in certain aspects of construction and design for certain interior features and leasehold improvements that is beneficial to the Company to better suit its business needs and intended purpose of the space.

The Company was involved in certain aspects of construction and design for certain interior features and leasehold improvements that are beneficial to the Company to better suit its business needs and intended purpose of the space.

The lease is accounted for as an operating lease and commenced in August 2021 .

11 unchanged sentences

The construction and design of the tenant improvements was the primary responsibility of the lessor.

While the Company was involved in certain aspects of construction and design for certain interior features and leasehold improvements that is beneficial to the Company to better suit its business needs and intended purpose of the space, all construction was handled directly by the landlord.

While the Company was involved in certain aspects of construction and design for certain interior features and leasehold improvements that are beneficial to the Company to better suit its business needs and intended purpose of the space, all construction was handled directly by the landlord.

The Company was not deemed to be the accounting owner of the tenant improvements prior to or after the construction period.

2 unchanged sentences

In July 2025, $ 656,000 of the security deposit was returned to the Company per the terms of the lease agreement.

As of March 31, 2026 , $ 218,000 remains as a security deposit included in other assets in the condensed consolidated balance sheets.

As of June 30, 2026 , $ 218,000 remains as a security deposit included in other assets in the condensed consolidated balance sheets.

In January 2024, the Company entered into an agreement to sublease the second floor of its corporate headquarters in San Diego, California (the January 2024 Sublease).

13 unchanged sentences

The Company will continue to account for the operating lease assets and related liabilities of the original lease as it did prior to the commencement of the subleases.

The Company recorded a reduction to lease costs of $ 710,000 and $ 713,000 related to income from these subleases during the three months ended March 31, 2026 and 2025, respectively.

Future minimum lease payments and sublease receipts under operating leases as of March 31, 2026 are as follows (in thousands):

The Company recorded a reduction to lease costs of $ 710,000 and $ 1.4 million related to income from these subleases during the three and six months ended June 30, 2026 , respectively, and $ 715,000 and $ 1.4 million during the three and six months ended June 30, 2025, respectively.

Future minimum lease payments and sublease receipts under operating leases as of June 30, 2026 are as follows (in thousands):

Operating Lease Payments

1 unchanged sentence

Year ending December 31,

2026 (remaining nine months)

2026 (remaining six months)

Total lease payments or sublease receipts

3 unchanged sentences

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties, and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated.

There are no matters currently outstanding for which any such liabilities have been accrued.

No provision for federal, state or foreign income taxes has been recorded for the three months ended March 31, 2026 and 2025.

The Company has incurred net operating losses for all the periods presented and has not reflected any benefit of such net operating loss carryforwards in the accompanying condensed consolidated financial statements due to uncertainty around utilizing these tax attributes within their respective carryforward periods.

The Company has no t recorded any amounts for loss contingencies as of June 30, 2026.

The Company records legal expenses associated with such contingencies as incurred.

On June 10, 2026, a purported securities class action complaint was filed against the Company and certain of its officers in the United States District Court for the Southern District of California.

The complaint alleges violations of the federal securities laws and seeks damages, costs, and other unspecified relief.

No lead plaintiff has been appointed, and no class has been certified.

The Company believes the claims are without merit and intends to defend the matter vigorously.

The outcome of any such legal proceedings, regardless of the merits, is inherently uncertain.

In addition, litigation and related matters are costly and may divert the attention of the Company’s management and other resources that would otherwise be engaged in other activities.

If the Company is unable to prevail in any such legal proceedings, its business, results of operations, liquidity, and financial condition could be adversely affected.

No provision for federal, state or foreign income taxes has been recorded for the three and six months ended June 30, 2026 and 2025 .

The Company has incurred net operating losses for all the periods presented and has no t reflected any benefit of such net operating loss carryforwards in the accompanying condensed consolidated financial statements due to uncertainty around utilizing these tax attributes within their respective carryforward periods.

The Company has recorded a full valuation allowance against all of its deferred tax assets as it is not more likely than not that such assets will be realized in the near future.

The Company’s policy is to recognize interest expense and penalties related to income tax matters as tax expense.

For the three months ended March 31, 2026 and 2025 , the Company has no t recognized any interest or penalties related to income taxes.

For the three and six months ended June 30, 2026 and 2025 , the Company has no t recognized any interest or penalties related to income taxes.

Net loss per share

The following table summarizes the computation of basic and diluted net loss per share of the Company (in thousands, except share and per share data):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Weighted-average shares of common stock used in computing net loss per share, basic and diluted

17 unchanged sentences

Significant segment expenses provided to the CODM are the same as presented on the condensed consolidated statements of operations and comprehensive loss as research and development expenses and general and administrative expenses.

Subsequent event

July 2026 underwritten offering

The aggregate net proceeds from the July 2026 Offering were $ 593.5 million, net of underwriting discounts and commissions and estimated offering costs of $ 38.9 million.

2026 Employment Inducement Incentive Award Plan

Effective August 10, 2026, the Board approved the adoption of the Company’s 2026 Employment Inducement Incentive Award Plan (the Inducement Plan) and reserved 6,200,000 shares of the Company's common stock for issuance pursuant to equity awards granted under the Inducement Plan.

The Inducement Plan was adopted without stockholder approval pursuant to Nasdaq Listing Rule 5635(c)(4) and the related guidance under Nasdaq IM 5635-1 (the Inducement Award Rules).

The Inducement Plan provides for the grant of equity-based awards, including nonstatutory stock options, restricted stock units, restricted stock, stock appreciation rights, performance shares, and performance stock units, and its terms are substantially similar to the 2021 Plan, but with such other terms and conditions intended to comply with the Nasdaq inducement award exception or to comply with the Nasdaq acquisition and merger exception.

In accordance with the Inducement Award Rules, awards under the Inducement Plan may only be made to individuals not previously employees or non-employee directors of the Company (or following such individuals’ bona fide period of non-employment with the Company), as an inducement material to the individuals’ entry into employment with the Company or being rehired following a bona fide period of interruption of employment by the Company, or, to the extent permitted by the Inducement Award Rules, in connection with a merger or acquisition.

Effective August 10, 2026, Charles S.

Fuchs, M.D., M.P.H., was appointed President, Research & Development of the Company.

In connection with his employment, the Company granted a stock option award to purchase 1,300,000 shares of the Company’s common stock at an exercise price of $ 18.12 per share.

1,278,520 of the stock options were granted under the Inducement Plan and the remaining options were granted under the 2021 Plan.

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

What changed 10-Q

Item 1. Financial Statements