What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2025-03-03 compared with 2024-02-22 · 62 added, 87 removed, 175 unchanged (46% of the section changed)

7 unchanged sentences

Since our inception in 2017, our precision medicine muscle platform has generated several programs to address a variety of muscle diseases.

We are advancing two clinical-stage programs and a number of preclinical programs.

The Company’s deep expertise in muscle physiology is driving a new generation of first-in-class therapeutics.

EDG-5506 is an orally administered skeletal myosin inhibitor in multiple Phase 2 clinical trials, including a pivotal cohort, in patients with either Becker, Duchenne, and Limb-Girdle muscular dystrophies or McArdle Disease.

EDG-7500, currently in a Phase 1 trial, is a novel cardiac sarcomere modulator for the treatment of hypertrophic cardiomyopathy (HCM) and other disorders of cardiac diastolic dysfunction.

We also continue to advance preclinical exploration, including novel cardiometabolic targets.

We are advancing two clinical-stage programs in muscular dystrophies, severe cardiac diseases, and a number of preclinical programs.

Our muscular dystrophy program includes sevasemten, an orally administered skeletal myosin inhibitor.

Sevasemten is currently being studied in multiple Phase 2 clinical trials, including a pivotal cohort, in patients with either Becker muscular dystrophy (Becker) or Duchenne muscular dystrophy (Duchenne).

Our cardiovascular program includes EDG-7500, a novel, oral, selective cardiac sarcomere modulator.

EDG-7500 is currently being studied in a multipart Phase 2 trial in both obstructive and non-obstructive hypertrophic cardiomyopathy (HCM).

We are also continuing to advance our preclinical exploration, including novel cardiometabolic targets.

From this foundation and our dedication to muscle physiology and function, we will build a leading global biopharmaceutical company driving advances to improve the lives of people suffering from muscle diseases.

As a clinical-stage biopharmaceutical company, we are focused on the discovery, development and commercialization of innovative treatments for severe muscle diseases for which there is significant unmet medical need.

Guided by our holistic drug discovery approach to targeting the muscle as an organ, we have combined our foundational expertise in muscle biology and small molecule engineering to build our proprietary, muscle focused drug

discovery platform.

Our platform utilizes custom-built high throughput and translatable systems that measure integrated muscle function in whole organ extracts to identify small molecule precision medicines regulating key proteins in muscle tissue, initially focused on addressing rare neuromuscular and cardiac diseases.

We have developed and characterized a library of novel sarcomere modulators exhibiting a broad range of pharmacological and pharmacokinetic (PK) properties regulating disease-related muscle biology.

We have developed and characterized a library of novel sarcomere modulators exhibiting a broad range of pharmacological and pharmacokinetic properties regulating disease-related muscle biology.

We have incurred significant losses since the commencement of our operations.

Our net losses were $100.2 million and $67.6 million for the year ended December 31, 2023 and 2022, respectively, and we expect to continue to incur significant losses for the foreseeable future as we advance our product candidates through preclinical development and clinical trials and seek regulatory approval of our product candidates.

Our net losses were $133.8 million and $100.2 million for the years ended December 31, 2024 and 2023, respectively, and we expect to continue to incur significant losses for the foreseeable future as we advance our product candidates through preclinical development and clinical trials and seek regulatory approval of our product candidates.

Our net losses may fluctuate significantly from period to period, depending on the timing of and expenditures on our planned research and development activities.

1 unchanged sentence

To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock.

From inception through December 31, 2023, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering and issuance of our common stock under an “at the market offering” program (the ATM Program) have generated net proceeds of $367.8 million.

From inception through December 31, 2024, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under an “at the market offering” program (the ATM Program), and underwritten registered direct offering have generated net proceeds of $606.6 million.

We believe that our existing cash and cash equivalents and marketable securities of $470.2 million will enable us to fund our planned operating expenses and capital expenditure requirements through at least the next 12 months.

Macroeconomic and Geopolitical Developments

We are monitoring macroeconomic and geopolitical developments, such as inflation, instability in the banking and financial services sector, tightening of the credit markets, international conflicts, COVID-19, cybersecurity and sanctions so that the Company can be prepared to react to new developments as they arise.

We are monitoring macroeconomic and geopolitical developments, such as inflation, instability in the banking and financial services sector, tightening of the credit markets, the change in the U.S.

presidential administration, international conflicts, public health pandemics, cybersecurity and sanctions so that the Company can be prepared to react to new developments as they arise.

Components of Our Results of Operations

6 unchanged sentences

● external expenses incurred in connection with the clinical development of our product candidates including under agreements with third parties, such as consultants and contract research organizations (CROs);

● the cost of external manufacturing drug products for use in our preclinical studies and ongoing and planned clinical trials including under agreements with third parties such as consultants and contract development and manufacturing organizations (CDMOs);

● expenses incurred in connection with the preclinical development of our product candidates including external, or outsourced professional scientific development services, consulting research fees and payments made under sponsored research arrangements with third parties;

2 unchanged sentences

● expenses related to compliance with regulatory requirements.

● payments made under third-party licensing agreements.

The majority of these expenses have been incurred to advance our lead product candidate, EDG-5506 and to a lesser degree EDG-7500.

The majority of these expenses have been incurred to advance our lead product candidates, sevasemten and EDG-7500.

We expect that significant additional spending will be required to progress these and other potential discoveries through the remainder of the clinical development phases.

7 unchanged sentences

Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages, primarily due to the increased size and duration of later-stage clinical trials.

As of December 31, 2023 we have initiated four Phase 2 clinical trials for EDG-5506 (CANYON, LYNX, FOX and DUNE) and a potentially registrational, or pivotal cohort in individuals with Becker (GRAND CANYON).

As a result, we expect that our research and development expenses will increase substantially over the next several years as we advance EDG-5506, EDG-7500, a product from our EDG-003 cardiometabolic discovery program through clinical trials and additional product candidates enter clinical trials;

We are currently conducting four Phase 2 clinical trials with sevasemten for people with muscular dystrophy (CANYON, LYNX, FOX and DUNE), including a potentially registrational, or pivotal cohort, in individuals with Becker (GRAND CANYON) as part of the CANYON trial, and a multipart Phase 2 trial with EDG-7500 for people with HCM (CIRRUS-HCM).

As a result, we expect that our research and development expenses will increase substantially over the next several years as we advance sevasemten, EDG-7500, a product from our EDG-003 cardiometabolic discovery program through clinical trials and additional product candidates;

continue to develop our proprietary drug discovery platform;

20 unchanged sentences

● maintaining a continued acceptable safety profile of the product candidates following approval.

Any changes in the outcome of any of these factors could significantly impact the costs and timing

associated with the development of our product candidates.

Any changes in the outcome of any of these factors could significantly impact the costs and timing associated with the development of our product candidates.

General and administrative expenses

20 unchanged sentences

External research and development expenses:

EDG-5506 clinical program

Sevasemten clinical program

EDG-7500 clinical program

2 unchanged sentences

Total research and development expenses

Research and development expenses were $90.9 million for the year ended December 31, 2023 compared to $54.0 million for the year ended December 31, 2022.

The increase of $36.9 million was driven by $14.8 million of higher research and development expenses related to our EDG-5506 program which consisted of $5.0 million incurred in connection with our GRAND CANYON, MESA and FOX trials which were not active during the comparable period in 2022, $7.0 million of increased clinical trial activity in our CANYON, LYNX and DUNE studies from site activations and patient enrollment and $2.8 million of increased product candidate manufacturing costs to support current and future trials.

Internal costs, including personnel related increased $14.7 million due largely to expenses associated with increased employee headcount, including stock-based compensation expense to support the growth of our research and development programs.

EDG-7500 clinical program expenses of $9.0 million are now shown separately in the above table due to advancing into a Phase 1 clinical trial during the third quarter of 2023.

These expenses include nonclinical costs of $3.8 million, clinical trial costs of $3.2 million, product candidate manufacturing costs of $1.4 million and $0.6 million in other development costs.

Discovery and preclinical expenses decreased $1.7 million primarily due to reclassification of EDG-7500 costs which are now shown separately.

Research and development expenses were $127.0 million and $90.9 million for the years ended December 31, 2024 and 2023, respectively.

The increase of $36.1 million was attributed to the following:

● an increase of $16.8 million in sevasemten clinical program expenses which was primarily due a $10.9 million increase in our GRAND CANYON cohort, a $4.0 million increase in our FOX trial, a $2.4 million increase in our MESA trial, and a $2.2 million increase in our LYNX trial related to site activation and patient enrollment as the trials were in startup phases in the third and fourth quarter of 2023.

These increases were partially offset by a $2.2 million decrease in our CANYON trial, which was completed in October 2024 vs.

full-year activity in 2023 and a $0.5 million decrease in other development activity;

● an increase in EDG-7500 clinical program expenses of $8.9 million primarily due to the activation of our Phase 2 CIRRUS-HCM trial in 2024 incurring costs of $4.4 million related to manufacturing, site activation, and patient enrollment, a $2.1 million increase in clinical trial expenses related to our Phase 1 trial that was activated in late 2023 and completed in 2024, and a $2.5 million increase in other Phase 1 trial costs, nonclinical costs, and other development costs;

● an increase of $13.4 million in internal costs, primarily related to an $8.3 million increase in personnel costs for salaries, benefits, and employee expenses resulting from increased employee headcount to support the growth of our research and development programs, a $3.9 million increase in stock-based compensation

related to increased headcount and overall higher stock prices driving increased option fair values, and a $1.2 million increase related to depreciation and other facilities costs.

Partially offset by:

● a decrease in discovery and preclinical expenses of $3.1 million due to costs incurred in 2023 related to EDG-7500 development prior to entering clinical trials, which were a significant portion of the first nine months of 2023’s discovery and preclinical expenses, now shown separately.

The decrease related to EDG-7500 advancing to clinical development was offset with increases in other costs from our development efforts in our EDG-003 program .

General and administrative expenses

General and administrative expenses were $31.9 million for the year ended December 31, 2024 compared to $23.5 million for the year ended December 31, 2023.

The increase of $5.8 million was primarily related to $4.3 million in increased personnel-related costs from increased headcount, including stock-based compensation to support our growing research and development efforts and $2.3 million in increased professional and consulting costs and other administrative costs which was partially offset by a $0.8 million decrease in directors’ and officers’ insurance.

The increase of $8.4 million was primarily related to $2.9 million in increased personnel-related costs from increased headcount, including a $3.2 million increase in stock-based compensation, to support our growing research and development efforts and $2.8 million in increased professional and consulting costs and other administrative costs which was partially offset by a $0.5 million decrease in directors’ and officers’ insurance.

Interest income

5 unchanged sentences

To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock.

From inception through December 31, 2023, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering and issuance of our common stock under the ATM Program have generated net proceeds of $367.8 million.

Following December 31, 2023, the ATM Program generated an additional net proceeds of $7.0 million.

We also generated gross proceeds of $240.0 million from our underwritten registered direct offering in January 2024.

From inception through December 31, 2024, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under the ATM Program, and underwritten registered direct offering have generated net proceeds of $606.6 million.

As of December 31, 2024, we had cash, cash equivalents and marketable securities in the amount of $470.2 million.

3 unchanged sentences

Net cash used in operating activities

Net cash provided by (used in) investing activities

Net cash (used in) provided by investing activities

Net cash provided by financing activities

Net increase in cash and cash equivalents

Net (decrease) increase in cash and cash equivalents

Operating activities

Cash used in operating activities in the year ended December 31, 2023 was primarily driven by our net loss for the period of $100.2 million, and was also impacted by changes in operating assets and liabilities which increased net working capital by $1.6 million.

Cash used in operating activities was reduced by non-cash charges of $9.8 million relating to stock-based compensation expense of $17.6 million, depreciation of $1.6 million and amortization of right-of-use asset of $0.2 million, which was partially offset by amortization of premium and accretion of discounts, net on marketable securities of $9.5 million.

Cash used in operating activities in the year ended December 31, 2022 was primarily driven by our net loss for the period of $67.6 million, and was also impacted by changes in operating assets and liabilities which decreased net working capital by $4.1 million.

Cash used in operating activities was reduced by non-cash charges of $10.9 million relating to stock-based compensation expense of $10.9 million, depreciation of $0.4 million and amortization of right-of-use asset of $0.2 million, which was partially offset by amortization of premium and accretion of discounts, net of marketable securities of $0.5 million.

Cash used in operating activities in the year ended December 31, 2024 was $109.0 million primarily driven by our net loss for the period of $133.8 million, and was also impacted by changes in operating assets and liabilities which

decreased net working capital by $10.3 million.

Cash used in operating activities was reduced by non-cash charges of $14.5 million related to stock-based compensation expense of $24.7 million, depreciation of $2.1 million, and amortization of right-of-use asset of $0.2 million, partially offset by accretion of discounts on marketable securities of $12.5 million.

Cash used in operating activities in the year ended December 31, 2023 was $91.9 million primarily driven by our net loss for the period of $100.2 million, and was also impacted by changes in operating assets and liabilities which increased net working capital by $1.6 million.

Cash used in operating activities was reduced by non-cash charges of $9.8 million related to stock-based compensation expense of $17.6 million, depreciation of $1.6 million, and amortization of right-of-use asset of $0.2 million, partially offset by amortization of premium and accretion of discounts, net on marketable securities of $9.5 million.

Investing activities

Cash provided by investing activities during the year ended December 31, 2023 amounted to $102.9 million which was due to $255.9 million in purchases of marketable securities and $5.7 million for leasehold improvements for our new facility and the purchase of equipment, which was partially offset by $344.4 million in maturities of marketable securities and $20.1 million in sales of marketable securities.

Cash used in investing activities during the year ended December 31, 2024 amounted to $184.7 million which was due to $477.1 million in purchases of marketable securities and $1.3 million for leasehold improvements for our new facility and the purchase of equipment, which was partially offset by $277.9 million in maturities of marketable securities and $15.8 million in sales of marketable securities.

Financing activities

Cash provided by financing activities during the year ended December 31, 2024 was $249.3 million, which was due to $239.1 million in net proceeds from the issuance of common stock during the year (consisting of $232.1 million from the underwritten registered direct offering and $7.0 million from the ATM Program), cash proceeds of $9.5 million from the issuance of common stock upon the exercise of stock options, and $0.9 million in proceeds from the employee stock purchase plan, which was offset by $0.3 million for the payment of deferred offering costs.

Cash provided by financing activities during the year ended December 31, 2023 was $53.2 million, which was due to $52.6 million in net proceeds from the ATM Program, cash proceeds $0.6 million in proceeds from the employee stock purchase plan and $0.1 million from the issuance of common stock upon the exercise of stock options, which was offset by $0.2 million for the payment of deferred offering costs.

Cash provided by financing activities during the year ended December 31, 2022 was $129.6 million, which was due to $129.2 in net proceeds from the September 2022 Offering, cash proceeds of $0.4 million from the issuance of common stock upon the exercise of stock options, $0.3 million for the payment of deferred offering costs and $0.3 million in proceeds from the employee stock purchase plan.

Funding requirements

We will continue to require substantial additional capital to develop our product candidates and fund operations for the foreseeable future.

Although we do not have any availability under our shelf registration statement that was filed on April 1, 2022 with the SEC that became effective on May 5, 2022, we intend to in the future file a shelf registration statement for additional equity or debt offerings.

On May 10, 2024, we filed an automatic shelf registration statement on Form S-3ASR that allows us to undertake various equity and debt offerings and entered into the Leerink Sales Agreement under which we may offer and sell shares of common stock, having aggregate sales proceeds of up to $175,000,000 from time to time, through the Leerink ATM.

We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the development of and seek regulatory approvals for our product candidates and begin to commercialize any approved products.

11 unchanged sentences

● acquire or in-license other product candidates and technologies.

We do not currently have material any long-term capital requirements other than what will be required to fund operations for the foreseeable future and the amounts disclosed on the contractual obligations and commitments section below.

In order to complete the process of obtaining regulatory approval for our product candidates and to build the

sales, marketing and distribution infrastructure that we believe will be necessary to commercialize our product candidates, if approved, we will require substantial additional funding.

We do not currently have any long-term material capital requirements other than what will be required to fund operations for the foreseeable future and the amounts disclosed on the contractual obligations and commitments section below.

In order to complete the process of obtaining regulatory approval for our product candidates and to build the sales, marketing and distribution infrastructure that we believe will be necessary to commercialize our product candidates, if approved, we will require substantial additional funding.

We have based our projections of operating capital requirements on assumptions that may prove to be incorrect and we may use all of our available capital resources sooner than we expect.

2 unchanged sentences

● the scope, progress, results and costs of researching and developing our product candidates including:

● conducting preclinical studies and clinical trials;

● the costs, timing and outcome of regulatory review of our product candidates;

● the number and characteristics of other product candidates that we pursue;

● the costs of future activities, including product sales, medical affairs, marketing, manufacturing and distribution, for any of our product candidates for which we receive marketing approval;

● the costs of manufacturing products of consistent quality and obtaining sufficient inventory to support commercial launch;

● the revenue, if any, received from commercial sale of our products, should any of our product candidates receive marketing approval;

● the cost and timing of hiring new employees to support our continued growth;

o conducting preclinical studies and clinical trials;

o the costs, timing and outcome of regulatory review of our product candidates;

o the number and characteristics of other product candidates that we pursue;

o the costs of future activities, including product sales, medical affairs, marketing, manufacturing and distribution, for any of our product candidates for which we receive marketing approval;

o the costs of manufacturing products of consistent quality and obtaining sufficient inventory to support commercial launch;

o the revenue, if any, received from commercial sale of our products, should any of our product candidates receive marketing approval;

o the cost and timing of hiring new employees to support our continued growth;

● the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending intellectual property-related claims;

19 unchanged sentences

Payments due upon cancellation consist only of payments for services provided and expenses incurred, including non-cancelable obligations of our service providers, up to the date of cancellation.

In addition, we exclusively licensed intellectual property from The Ohio State Innovation Foundation (OSIF) in a license agreement that was made effective November 20, 2020.

Under the license agreement, we were obligated to make payments to OSIF aggregating up to $1.3 million per product covered by the OSIF licensed patent rights upon the achievement of specified development and regulatory approval milestones and approximately $2.3 million per product covered by the OSIF licensed patent rights upon the achievement of specified sales milestones.

We were also obligated to pay low single-digit royalties to OSIF based on net sales by us and our affiliates and sublicensees of each product covered by the OSIF licensed patent rights.

In addition, in the event we sublicensed the OSIF licensed patent rights, we were obligated to pay OSIF a specified portion of income we receive from sublicensing.

On July 27, 2023, we provided notice to OSIF to terminate the license agreement because the licensed technology is no longer relevant to the Company’s business.

The license agreement was terminated effective, October 25, 2023, and as a result we no longer have any payment obligations to OSIF.

As of December 31, 2023, the Company has paid $0.7 million for license fees and milestones achieved in connection with the license agreement.

Our long-term cash requirements as of December 31, 2024 includes our lease obligations.

8 unchanged sentences

Our actual results may differ from these estimates.

believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.

We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.

While our significant accounting policies are described in the notes to our financial statements appearing elsewhere in this Annual Report, we believe that the following critical accounting policies are most important to understanding and evaluating our reported financial results.

Research and development expenses and accrued research and development expenses

Accrued research and development expenses

As part of the process of preparing our financial statements, we are required to estimate our accrued research and development expenses.

This process involves reviewing open contracts and purchase orders, communicating with our personnel to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of actual costs.

This process involves reviewing open contracts and purchase orders, communicating with our personnel and external service providers to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of actual costs.

The majority of our service providers invoice us in arrears for services performed, based on a pre-determined schedule or when contractual milestones are met, but some require advance payments.

13 unchanged sentences

To date, there have not been any material adjustments to our prior estimates of accrued research and development expenses.

Stock-based compensation

We measure stock-based awards granted to employees, directors and non-employee consultants based on their fair value on the date of grant and recognize compensation expense for those awards over the requisite service period, which is generally the vesting period of the respective award.

We issue stock options with only service-based vesting conditions and record the expense for these awards using the straight-line method.

We estimate the fair value of each stock option grant at the date of grant using the Black-Scholes option-pricing model.

The Black-Scholes option-pricing model requires inputs based on certain subjective assumptions.

Changes to these assumptions can materially affect the fair value of stock options and ultimately the amount of stock-based compensation expense recognized in our financial statements.

These assumptions include:

Expected Term — We have opted to use the “simplified method” for estimating the expected term of options, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option, which is generally 10 years.

Expected Volatility — Due to our limited operating history and a lack of company-specific historical and implied volatility data, we have based our estimate of expected volatility on an analysis of the volatility used by a peer group of publicly traded companies.

In evaluating similarity, we consider factors such as industry, stage of life cycle and size.

Risk-Free Interest Rate — The risk-free rate assumption is based on the U.S.

Treasury instruments with maturities similar to the expected term of our stock options.

Expected Dividend — To date, we have not issued any dividends and do not expect to issue dividends over the life of the options and therefore have estimated the dividend yield to be zero.

We determine the fair market value of our common stock using the closing price of our common stock as reported on the Nasdaq Global Select Market.

Recently Issued Accounting Pronouncements

Refer to Note 2, “Summary of Significant Accounting Policies,” in the accompanying notes to the consolidated financial statements for a discussion of recent accounting pronouncements that were adopted in 2024.

Emerging Growth Company and Smaller Reporting Company Status

Section 107 of The Jumpstart Our Business Startups Act of 2012 (JOBS Act) permits an “emerging growth company” such as us to take advantage of an extended transition time to comply with new or revised accounting standards as applicable to public companies.

Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.

We have elected to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for private companies.

We will remain an emerging growth company until the earliest to occur of:

(1) the last day of the fiscal year in which we have more than $1.07 billion in annual revenue;

(2) the date we qualify as a “large accelerated filer,” with at least $700 million of equity securities held by non-affiliates;

(3) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period;

and (4) the last day of the fiscal year ending after the fifth anniversary of our initial public offering.

We are also a “smaller reporting company,” meaning that the market value of our stock held by non-affiliates is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year.

We may continue to be a smaller reporting company if either (1) the market value of our stock held by non-affiliates is less than $250 million or (2) our annual revenue was less than $100 million during the most recently completed fiscal year and the market value of our stock held by non-affiliates is less than $700 million.

If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies.

Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.

Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company as defined by Rule 12b‑2 of the Exchange Act and are not required to provide the information required under this item.

Transition from Emerging Growth Company and Smaller Reporting Company Status

On December 31, 2024, we ceased to be an “emerging growth company” (EGC), as defined in the JOBS Act, due to our large accelerated filer status.

Accordingly, we may no longer take advantage of EGC-related reduced reporting requirements that are otherwise applicable to public companies.

For example, we have previously elected to take advantage of the extended transition period for complying with new or revised accounting standards.

EGC status also exempted us from having to provide an auditor attestation of internal control over financial reporting under Sarbanes-Oxley Act Section 404(b).

On December 31, 2024, we also ceased to be a “smaller reporting company” because the market value of our stock held by non-affiliates plus the aggregate amount of gross proceeds to us as a result of our initial public offering exceeded $700 million as of June 30, 2024.

However, we are complying with certain scaled disclosure requirements available to smaller reporting companies in this Annual Report (including, for example, presenting only the two most recent fiscal years of audited consolidated financial statements), which we are permitted to do under SEC rules because we were a smaller reporting company in 2024.

As a result, the information that we provide to our stockholders may be different than you might receive from other public reporting companies in which you hold equity interests.

Due to the loss of EGC and smaller reporting company status, we expect our public company compliance costs to increase.

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 7. Management’s Discussion and Analysis