What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-11-07 compared with 2024-08-08 · 129 added, 98 removed, 193 unchanged (54% of the section changed)

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On June 6, 2024, the U.S.

Food and Drug Administration (FDA) approved RYTELO for the treatment of adult patients with low- to intermediate-1 risk myelodysplastic syndromes, or lower-risk MDS, with transfusion-dependent, or TD, anemia requiring four or more red blood cell units over eight weeks who have not responded to or have lost response to or are ineligible for erythropoiesis-stimulating agents, or ESAs.

In September 2023, we submitted a marketing authorization application, or MAA, in Europe that was validated for review by the European Medicines Agency, or EMA, for RYTELO for the same proposed indication as in the U.S.

We expect review of the MAA could be completed in early 2025, We plan to finalize our strategy for European Union, or EU, commercialization in 2025, which, subject to regulatory approval, could include self-commercialization or potential partnerships.

or more red blood cell units over eight weeks who have not responded to or have lost response to or are ineligible for erythropoiesis-stimulating agents, or ESAs.

In September 2023, we submitted a marketing authorization application, or MAA, in the European Union, or EU, that was validated for review by the European Medicines Agency, or EMA, for RYTELO for the same proposed indication as in the U.S.

We expect review of the MAA by the Committee for Medicinal Products for Human Use, or CHMP, could be completed in late 2024 or early 2025, with a potential approval decision by the European Commission in the first half of 2025.

We are continuing to prepare for the potential launch of RYTELO in the EU and subject to regulatory approval, are planning to commercialize RYTELO in select EU markets commencing in 2026.

Our regulatory approval in the U.S.

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Recent Developments

On July 26, 2024, we announced that the National Comprehensive Cancer Network, or NCCN, has updated its Clinical Practice Guidelines in Oncology for the treatment of MDS to include RYTELO as a Category 1 and 2A treatment of symptomatic anemia in patients with lower-risk MDS.

Treatments are classified as Category 1 and 2A when there is uniform NCCN consensus ≥85% that the intervention is appropriate.

For RS- lower-risk MDS patients with symptomatic anemia, RYTELO is included as a Category 1 second-line treatment after either erythropoiesis-stimulating agents (ESAs) or luspatercept in patients with serum EPO ≤500 mU/mL, and as a Category 2A first-line treatment in patients with serum EPO >500 mU/mL and unlikely to respond to immunosuppressive therapy.

For RS+ lower-risk MDS patients with symptomatic anemia, RYTELO is included as a Category 1 second-line treatment after luspatercept in patients with serum EPO ≤500 mU/mL, and as a Category 2A first-line treatment in patients with serum EPO >500 mU/mL.

On October 3, 2024, the U.S.

Centers for Medicare & Medicaid Services assigned a permanent and product-specific J-code (J0870) for RYTELO, which will become effective on January 1, 2025.

J-codes are permanent reimbursement codes used by government payers and commercial insurers to facilitate billing of Medicare Part B treatments, which must be administered by a healthcare professional.

On November 1, 2024, we entered into the Pharmakon Loan Agreement with BioPharma Credit Investments V (Master) LP and BPCR Limited Partnership, each, a Lender, which are investment funds managed by Pharmakon Advisors, LP, and BioPharma Credit PLC, as collateral agent, that provides for a 5-year senior secured term loan facility to us in an aggregate principal amount of up to $250.0 million, divided into three committed tranches:

(i) a Tranche A Loan in an aggregate principal amount of $125.0 million, which was funded on November 1, 2024;

(ii) a Tranche B Loan in an aggregate principal amount of $75.0 million, which is available, subject to certain limited conditions, at our option;

and (iii) a Tranche C Loan in an aggregate principal amount of $50.0 million, which is available to us upon reaching a specified trailing twelve-month RYTELO revenue milestone.

The Tranche B Loan and the Tranche C Loan, once available, may be requested on or prior to December 31, 2025.

A portion of the proceeds from the Tranche A Loan were used to repay, in full, all amounts owed ($86.5 million) under the Hercules Loan Agreement, which was terminated effective November 1, 2024.

The remaining proceeds will be used to fund the Company’s general corporate and working capital requirements.

On November 1, 2024, we entered into the Royalty Pharma Agreement with Royalty Pharma.

Pursuant to the Royalty Pharma Agreement, we received an upfront payment of $125.0 million, or the Purchase Price, in exchange for which Royalty Pharma obtained the right to receive tiered Revenue Interest Payments with respect to Annual Net Sales of RYTELO beginning on July 1, 2024, ranging from:

(i) 7.75% of Annual Net Sales up to $500.0 million;

(ii) 3.0% of Annual Net Sales in excess of $500.0 million but less than or equal to $1.0 billion;

and (iii) 1.0% in respect of Annual Net Sales in excess of $1.0 billion.

The Revenue Interest Payments to Royalty Pharma are capped, such that they will cease upon reaching a multiple of 1.65 times the Purchase Price if Royalty Pharma receives Revenue Interest Payments in that amount in respect of net sales occurring on or before June 30, 2031, or upon reaching a

multiple of 2.0 times the Purchase Price thereafter.

Our revenue payment obligations under the Royalty Pharma Agreement may be discharged in connection with a change of control of the Company in an amount equal to 1.65 times the Purchase Price minus the aggregate Revenue Interest Payments received by Royalty Pharma as of the date of the closing of the change of control, if the closing of the change of control occurs on or prior to December 31, 2027, or in an amount equal to 2.0 times the Purchase Price minus the aggregate Revenue Interest Payments received by Royalty Pharma as of the date of the closing of the change of control, if the closing of the change of control occurs after December 31, 2027.

There are no other royalties payable on RYTELO, which was developed internally and is exclusively owned by Geron.

The Royalty Pharma Agreement contains customary representations, warranties and indemnities of the Company and Royalty Pharma and customary covenants relating to the Revenue Interest Payments.

See Note 9 on Subsequent Events in Notes to Condensed Consolidated Financial Statements of this Report for additional information about the Pharmakon Loan Agreement, Royalty Pharma Agreement and the repayment and termination of the Hercules Loan Agreement.

Financial Overview

Since our inception, we have primarily financed our operations through the sale of equity securities, draw downs on our debt facility, interest income on our marketable securities and payments we received under our prior collaborative and licensing arrangements.

As of June 30, 2024, we had approximately $430.4 million in cash, cash equivalents, restricted cash and marketable securities and a long-term principal debt balance of $80.0 million.

Since our inception, we have primarily financed our operations through the sale of equity securities, draw downs on our debt facilities, interest income on our marketable securities and payments we received under the Royalty Pharma Agreement and our prior collaborative and licensing arrangements.

As of September 30, 2024, we had approximately $378.9 million in cash, cash equivalents, restricted cash and marketable securities.

On a pro forma basis, including gross proceeds from the upfront payment under the Royalty Pharma Agreement and the Tranche A Loan, and after repayment of our existing debt under the Hercules Loan Agreement, we had approximately $542.4 million in cash, cash equivalents, restricted cash, and marketable securities as of September 30, 2024.

We began commercializing RYTELO in June 2024, and the commercial potential of and our ability to successfully commercialize RYTELO is unproven.

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We have incurred significant net losses since our inception in 1990, resulting principally from costs incurred in connection with our research and development activities and from general and administrative costs associated with our operations.

As of June 30, 2024, we had an accumulated deficit of approximately $1.7 billion.

As of September 30, 2024, we had an accumulated deficit of approximately $1.7 billion.

The significance of future losses, future revenues and any potential future profitability will depend primarily on the clinical and commercial success of RYTELO, our sole product.

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As a result, we expect research and development expenses and selling, general and administrative expenses to increase in future periods as we continue to support the commercialization of RYTELO in the U.S.

and further development of RYTELO, including the conduct and completion of IMpactMF, IMproveMF and IMpress, as well as the potential European commercialization of RYTELO, in lower-risk MDS.

and further development of RYTELO, including the conduct and completion of IMpactMF, IMproveMF and IMpress, as well as the potential commercialization of RYTELO in the EU, if approved, in lower-risk MDS.

In addition, we expect our interest expense to increase due to the draw down of the Tranche A Loan and potential future draw downs of the other Term Loans under the Pharmakon Loan Agreement, and our royalty expense to increase due to our revenue interest payments associated with the Royalty Pharma Agreement.

On March 21, 2024, we completed an underwritten offering of 41,999,998 shares of our common stock and a pre-funded warrant to purchase 8,002,668 shares of our common stock.

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The pre-funded warrant has an exercise price of $0.001 per share and may be exercised at any time until it is exercised in full.

As of June 30, 2024, the 2024 pre-funded warrant had not been exercised.

As of September 30, 2024, the 2024 pre-funded warrant had not been exercised.

The net cash proceeds from the March 2024 public offering were approximately $141.0 million, after deducting the underwriting discount and other offering expenses paid by us, and excluding any future proceeds from the exercise of the 2024 pre-funded warrant.

Based on our current operating plans and assumptions, we believe that our existing cash, cash equivalents, and current and noncurrent marketable securities, together with projected revenues from U.S.

sales of RYTELO, will be sufficient to fund our projected operating requirements into the second quarter of 2026.

We will require substantial additional funding to further advance the development of imetelstat, including through the completion of our ongoing clinical trials and any potential future clinical trials, as well as conducting the clinical, regulatory and commercialization activities necessary to potentially bring imetelstat to market in relapsed/refractory MF and any other indications we are pursuing or may in the future pursue, and our need for additional funds may arise sooner than planned.

As described above, we entered into the Pharmakon Loan Agreement and the Royalty Pharma Agreement on November 1, 2024, and in connection with these transactions all obligations outstanding under the Hercules Loan Agreement were repaid in full on November 1, 2024, upon which the Hercules Loan Agreement was terminated and all liens on our assets in granted in connection with the Hercules Loan Agreement were released.

Successful drug development and commercialization requires significant amounts of capital.

As of September 30, 2024, we had approximately $378.9 million in cash, cash equivalents, restricted cash and marketable securities.

Based on our current operating plans and assumptions, we believe that our existing cash, cash equivalents, and marketable securities ( including the $250 million received under the Pharmakon Loan Agreement and the

Royalty Pharma Agreement), together with anticipated revenues from U.S.

sales of RYTELO, will be sufficient to fund our projected operating requirements for at least the next 12 months from the date of this filing.

We believe that our projected financial resources will be sufficient to (i) support commercial launch of RYTELO in the U.S.

and potential launch in the EU, (ii) complete the Phase 3 IMpactMF trial in relapsed/refractory MF, (iii) invest in supply chain redundancy for RYTELO, and (iv) fund our general working capital requirements.

If we do not generate sufficient funds from commercial sales of RYTELO, or if we experience regulatory delays or other unforeseen events or choose to make other investments in our business, we may require additional funding, which could include a combination of public or private equity offerings, debt financings (including additional tranches under the Pharmakon Loan Agreement, if available), collaborations, strategic alliances, licensing arrangements or marketing and distribution arrangements, which may not be possible.

If adequate funds are not available on a timely basis, if at all, our RYTELO commercialization efforts may be adversely affected and we may be unable to pursue further development of imetelstat, which would severely harm our business and we might cease operations.

If approved for marketing by regulatory authorities outside of the U.S., we may seek potential commercialization partners for such territories.

If approved for marketing in the EU by the EMA, we are planning to commercialize RYTELO in select EU markets commencing in 2026.

Until international regulatory authorities approve RYTELO for marketing, if at all, we cannot begin commercialization activities outside of the U.S.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

There have been no significant changes in our critical accounting policies and estimates during the six months ended June 30, 2024, as compared to the critical accounting policies and estimates disclosed in our 2023 Form 10-K.

Our significant accounting policies are described in Note 1 of Item 1 of this Report and in Item 7, “Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K.

There have been no significant changes in our critical accounting policies and estimates during the nine months ended September 30, 2024, as compared to the critical accounting policies and estimates disclosed in our 2023 Form 10-K.

Our condensed consolidated financial statements have been prepared in accordance with U.S.

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The preparation of these financial statements requires management to make estimates and assumptions that affect the reported assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Note 1 on Summary of Significant Accounting Policies in Notes to Condensed Consolidated Financial Statements of this quarterly report on Form 10-Q describes the significant accounting policies used in the preparation of the condensed consolidated financial statements.

Note 1 on Summary of Significant Accounting Policies in Notes to Condensed Consolidated Financial Statements of this Report describes the significant accounting policies used in the preparation of the condensed consolidated financial statements.

Estimates and assumptions about future events and their effects cannot be determined with certainty.

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Thus, historical results should not be viewed as indicative of future operating results.

In this regard, although we have begun to recognize revenue from RYTELO product sales in the U.S., we are very early in the product launch.

In this regard, although we have begun to recognize revenue from RYTELO product sales in the U.S., we are early in the product launch.

We expect that our sales revenue may vary significantly from period to period as the launch progresses.

RYTELO is our only product approved for marketing by the FDA and is approved solely for lower-risk MDS.

RYTELO is our only product approved for marketing by the FDA and is approved solely for certain patients with lower-risk MDS.

Revenue based on sales of RYTELO is dependent on our ability to execute a successful commercial launch of RYTELO in the U.S., and obtaining regulatory approval to commercialize RYTELO in other countries and other indications.

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and potential competition.

The following table summarizes our results of operations for the three and six months ended June 30:

Three Months Ended

Six Months Ended

(in thousands, except for percentage data)

The following table summarizes our results of operations for the three and nine months ended September 30:

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands, except for percentage data)

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Net income (loss)

** Percentage not meaningful

Product Revenues, Net

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We did not generate any revenue from product sales prior to the three months ended June 30, 2024 .

Total product revenue, net for the three months ended June 30, 2024 was approximately $780,000.

Total product revenue, net for the three and nine months ended September 30, 2024 was approximately $28.2 million and $29.0 million, respectively.

We expect product revenues, net to increase through the remainder of 2024.

In connection with the divestiture of our human embryonic stem cell assets, including intellectual property and proprietary technology, to Lineage Cell Therapeutics, Inc., or Lineage, (formerly BioTime, Inc.

which acquired Asterias Biotherapeutics, Inc.) in 2013, we are entitled to receive royalties on sales from certain research or commercial products utilizing our divested intellectual property.

We recognized royalty revenues of $102,000 and $406,000 in the three and six months ended June 30, 2024, respectively compared to $29,000 and $50,000, respectively, for the same period in 2023.

which acquired Asterias Biotherapeutics, Inc.) in

2013, we are entitled to receive royalties on sales from certain research or commercial products utilizing our divested intellectual property.

We recognized royalty revenues of $62,000 and $468,000 in the three and nine months ended September 30, 2024, respectively compared to $164,000 and $214,000 respectively, for the same period in 2023.

Royalty revenues in 2024 and 2023 primarily reflect estimated royalties from sales of cell-based research products from our divested stem cell assets.

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Our cost of goods sold consist of raw materials, third-party manufacturing costs to manufacture the raw materials into finished product, freight, and indirect overhead costs associated with the sale of RYTELO in the U.S.

The following table summarizes our expenses, including as a percentage of total expenses, for the three and six months ended June 30:

Three Months Ended June 30,

Six Months Ended June 30,

The following table summarizes our expenses, including as a percentage of total expenses, for the three and nine months ended September 30:

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

(in thousands, except for percentage data)

Cost of goods sold

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Total operating cost and expenses

** Percentage not meaningful

Cost of Goods Sold

Cost of goods sold was approximately $17,000 for the three and six months ended June 30, 2024, which consisted of costs to manufacture, and distribute our market product, RYTELO.

Cost of goods sold was approximately $456,000 and $473,000 for the three and nine months ended September 30, 2024, respectively, which consisted of costs to manufacture, and distribute our market product, RYTELO.

We began capitalizing inventory upon FDA approval of RYTELO.

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Prior to receiving FDA approval for RYTELO in June 2024, we manufactured inventory to be sold upon commercialization and recorded the costs as research and development expense.

As a result, the manufacturing costs related to the inventory manufactured prior to receiving FDA approval were expensed in a prior period and are therefore excluded from the cost of goods sold for the three and six months ended June 30, 2024.

We estimate our cost of sales related to product revenue as a percentage of net product revenue will continue to be positively affected as we sell through certain inventory that was previously expensed prior to FDA approval.

We estimate our cost of sales related to product revenue as a percentage of net product revenue will continue to be positively affected for the next 18 to 24 months as we sell through certain inventory that was previously expensed prior to FDA approval.

Research and Development Expenses

During the three and six months ended June 30, 2024 and 2023, our imetelstat program and our research discovery program related to potential next generation telomerase inhibitors were the only research and development programs we supported.

During the three and nine months ended September 30, 2024 and 2023, our RYTELO (imetelstat) program and our research discovery program related to potential next generation telomerase inhibitors were the only research and development programs we supported.

For these research and development programs, we incur direct external, personnel-related and other research and development costs.

For the three and six months ended June 30, 2024 and 2023, direct external expenses included costs for our CROs, consultants and other clinical-related vendors, as well as expenses for contract manufacturing and quality activities.

Personnel-related expenses primarily consist of salaries and wages, stock-based compensation, payroll taxes and benefits for our employees involved with ongoing research and development efforts.

Other research and development expenses primarily consist of research-related overhead associated with allocated expenses for rent and maintenance of facilities and other supplies.

Research and development expenses for the three and six months ended June 30, 2024 and 2023 were as follows:

Three Months Ended June 30,

Six Months Ended June 30,

For the three and nine months ended September 30, 2024 and 2023, research and development expenses consist of expenses incurred in developing and testing imetelstat and research related to potential next generation telomerase inhibitors.

These expenses include, but are not limited to, payroll and personnel expense, lab supplies, non-clinical studies, clinical trials, including support for investigator-led clinical trials, raw materials to manufacture clinical trial supply, manufacturing costs for research and clinical trial materials, sponsored research at other labs, consulting, costs to maintain technology licenses and research-related overhead.

Research and development expenses for the three and nine months ended September 30, 2024 and 2023 were as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

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Total research and development expenses

The decrease in research and development expenses for the three and six months ended June 30, 2024, compared to the same period in 2023, was primarily due to decreases in clinical development costs related to the Phase 3 IMerge trial, as well as decreases in manufacturing and quality costs due to the timing of imetelstat manufacturing batches.

Additionally, a portion of manufacturing and quality costs were capitalized in the current period due to FDA approval of RYTELO.

The decrease in research and development expenses for the three and nine months ended September 30, 2024, compared to the same period in 2023, was primarily due to manufacturing and quality costs that were capitalized in the current period due to FDA approval of RYTELO, versus being expensed in the prior period.

The decrease is partially offset by an increase in labor costs due to higher headcount, incentive and stock-based compensation expense recognized due to the vesting of performance-based stock options upon FDA approval.

For a more complete discussion of the risks and uncertainties associated with the development of imetelstat, see the sub‑sections entitled “Risks Related to the Development of Imetelstat” and “Risks Related to the Commercialization of RYTELO TM (Imetelstat” and “Risks Related to Regulatory Approval of RYTELO” in Part II, Item 1A entitled “Risk Factors” and elsewhere in this quarterly report on Form 10‑Q.

A discussion of the risks and uncertainties associated with the development of imetelstat can be found in the sub‑sections entitled “Risks Related to the Development of Imetelstat” and “Risks Related to the Commercialization of RYTELO” and “Risks Related to Regulatory Approval of RYTELO” in Part II, Item 1A entitled “Risk Factors” and elsewhere in this Report.

As a result of these risks and uncertainties, we are unable to determine with any degree of certainty the duration and completion costs of ongoing and potential future imetelstat research and development projects, anticipated completion dates, or when and to what extent we will receive cash inflows from the commercialization and sale of RYTELO in any other jurisdictions or indications we are pursuing or may in the future pursue, if at all.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were $39.4 million and $66.5 million for the three and six months ended June 30, 2024, respectively compared to $16.5 million and $29.4 million for the same period in 2023.

The increase in selling, general and administrative expenses for the three and six months ended June 30, 2024, compared to the same period in 2023, primarily reflects higher personnel-related expenses and stock-based compensation recognized upon FDA approval of RYTELO due to the vesting of performance-based stock options.

Selling, general and administrative expenses were $35.9 million and $102.4 million for the three and nine months ended September 30, 2024, respectively, compared to $18.4 million and $47.7 million for the same period in 2023.

The increase in selling, general and administrative expenses for the three and nine months ended September 30, 2024, compared to the same period in 2023, primarily reflects higher personnel-related expenses and stock-based compensation recognized upon FDA approval of RYTELO due to the vesting of performance-based stock options.

Interest Income

Interest income was $5.3 million and $9.6 million for the three and six months ended June 30, 2024, compared to $4.7 million and $8.6 million for the same period in 2023.

The increase in interest income for the three and six months ended June 30, 2024, compared to the same period in 2023, primarily reflects a larger marketable securities portfolio with the receipt of net cash proceeds from the underwritten offering completed in March 2024, as well as higher yields from recent marketable securities purchases.

Interest income was $4.9 million and $14.4 million for the three and nine months ended September 30, 2024, compared to $5.0 million and $13.6 million for the same period in 2023.

The decrease in interest income for the three months ended September 30, 2024, compared to the same period in 2023 was due to a decrease in interest rates.

The increase in interest income for the nine months ended September 30, 2024, compared to the same period in 2023, primarily reflects a larger marketable securities portfolio with the receipt of net cash proceeds from the underwritten offering completed in March 2024, as well as higher yields from marketable securities purchases.

Interest earned in future periods will depend on the size of our marketable securities portfolio and prevailing interest rates.

Interest Expense

Interest expense was $3.3 million and $6.8 million for the three and six months ended June 30, 2024, compared to $2.0 million and $3.9 million for the same period in 2023.

The increase in interest expense for the three and six months ended June 30, 2024, compared to the same period in 2023, primarily reflects rising interest rates.

Currently, we have $80.0 million in principal debt outstanding.

Interest expense reflects interest owed under the Loan Agreement, as well as amortization of associated debt issuance costs and debt discounts using the effective interest method and accrual for an end of term charge.

See Note 6 on Debt in Notes to Condensed Consolidated Financial Statements of this quarterly report on Form 10-Q for additional information about the Loan Agreement.

Interest expense was $3.0 million and $9.8 million for the three and nine months ended September 30, 2024, compared to $2.1 million and $6.0 million for the same period in 2023.

The increase in interest expense for the three and nine months ended September 30, 2024, compared to the same period in 2023, primarily reflects higher interest rates.

As of September 30, 2024, we had $80.0 million in principal debt outstanding.

Interest expense reflects interest owed under the Hercules Loan Agreement, as well as amortization of associated debt issuance costs and debt discounts using the effective interest method and accrual for an end of term charge.

See Note 6 on Debt in Notes to Condensed Consolidated Financial Statements of this Report for additional information about the Hercules Loan Agreement.

On November 1, 2024, we entered into the Pharmakon Loan Agreement and the Royalty Pharma Agreement, and in connection with these transactions, all obligations outstanding under the Hercules Loan Agreement were repaid in full on November 1, 2024, upon which the Hercules Loan Agreement was terminated.

We expect our interest expense to increase in future periods due to the draw down of the Tranche A Loan and potential future draw downs of the other Term Loans under the Pharmakon Loan Agreement.

Other Income and (Expense), Net

Other income and expense, net was an expense of $63,000 and $125,000 for the three and six months ended June 30, 2024, compared to an expense of $11,000 for the three months ended June 30, 2023, and an income of $28,000 for the six months ended June 30, 2023.

Other income and expense, net was an expense of $63,000 and $188,000 for the three and nine months ended September 30, 2024, respectively, compared to an expense of $92,000 and $64,000 for the three and nine months ended September 30, 2023,

respectively.

Other income and expense primarily reflects bank charges related to our cash operating accounts and marketable securities portfolio and foreign currency transaction adjustments.

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2024, we had cash, restricted cash, cash equivalents, and marketable securities of $430.4 million, compared to $378.1 million at December 31, 2023.

The increase in cash, restricted cash, cash equivalents and marketable securities during the six months ended June 30, 2024 was primarily the net result of the receipt of net cash proceeds of $141.0 million from our underwritten offering completed in March 2024.

As of September 30, 2024, we had cash, restricted cash, cash equivalents, and marketable securities of $378.9 million, compared to $378.1 million at December 31, 2023.

The slight increase in cash, restricted cash, cash equivalents and marketable securities during the nine months ended September 30, 2024 was primarily the net result of the receipt of net cash proceeds of $141.0 million from our underwritten offering completed in March 2024, offset by cash used in operations.

On March 21, 2024, we completed an underwritten public offering consisting of 41,999,998 shares of our common stock and a pre-funded warrant to purchase 8,002,668 shares of our common stock.

All of the securities were issued separately.

The offering price

of the common stock was $3.00 per share.

The offering price of the common stock was $3.00 per share.

The offering price of the pre-funded warrant was $2.99 per share.

The pre-funded warrant has an exercise price of $0.001 per share and may be exercised at any time until it is exercised in full.

As of June 30, 2024, the 2024 pre-funded warrant had not been exercised.

As of September 30, 2024, the 2024 pre-funded warrant had not been exercised.

The net cash proceeds from this offering were approximately $141.0 million, after deducting the underwriting discount and other offering expenses paid by us, and excluding any future proceeds from the exercise of the pre-funded warrant.

See Note 8 on Stockholders’ Equity in Notes to Condensed Consolidated Financial Statements of this quarterly report on Form 10-Q for additional information about the underwritten offering completed in March 2024.

From January 1, 2024 through June 30, 2024, we received $414,000 in cash proceeds from the exercise of warrants we issued in 2020, covering 281,211 shares of our common stock.

As of June 30, 2024, we had warrants remaining from our 2020 issuance covering 2,155,650 shares of our common stock, which if exercised in full for cash, would provide $2.8 million in cash proceeds.

As of June 30, 2024, we had a long-term principal debt balance of $80.0 million under the Loan Agreement with Hercules and SVB.

In June 2022, we entered into a second amendment to the Loan Agreement with Hercules and SVB.

Under the second amendment, the aggregate principal amount available to us increased from $75.0 million to $125.0 million.

On December 14, 2023, we entered into a third amendment to the Loan Agreement.

After giving effect to the third amendment, the aggregate principal amount draw down and remaining available to us under the Loan Agreement remains at $125.0 million, with such principal being available in a series of tranches, subject to certain terms and conditions.

The third amendment also provides that (i) the fourth tranche of the Loan Agreement was increased from $10.0 million to $30.0 million, (ii) the commitment period for the fifth tranche of the Loan Agreement of $20.0 million, which is available subject to achievement of a regulatory milestone and satisfaction of certain capitalization requirements, was extended through December 15, 2024, (iii) the variable annual interest rate on the outstanding loans has been decreased to the greater of:

(x) 9.0%, or (y) the sum of (A) the Prime Rate (as reported in The Wall Street Journal) minus 4.5%, plus (B) 9.0%;

and (iv) the interest only period of the Term Loan has been extended from June 30, 2024 through December 31, 2024, due to regulatory approval of RYTELO and satisfaction of certain financial and capitalization requirements.

In connection with the third amendment, on the third amendment effective date, we borrowed and received the entire fourth tranche of the Term Loan in the amount of $30.0 million.

After giving effect to such borrowing, the outstanding principal amount under the Amended Loan Agreement is $80.0 million.

On September 15, 2023, the third tranche of $20.0 million of the Term Loan expired and is no longer available for us, but was added to the fourth tranche as part of the third amendment to the Loan Agreement.

The Term Loan matures on October 1, 2025, which was extended from April 1, 2025 upon regulatory approval of RYTELO.

See Note 8 on Stockholders’ Equity in Notes to Condensed Consolidated Financial Statements of this Report for additional information about the underwritten offering completed in March 2024.

From January 1, 2024 through September 30, 2024, we received $419,000 in cash proceeds from the exercise of warrants we issued in 2020, covering 321,931 shares of our common stock.

As of September 30, 2024, we had warrants remaining from our 2020 issuance covering 2,152,570 shares of our common stock, which if exercised in full for cash, would provide $2.8 million in cash proceeds.

As of September 30, 2024, we had a long-term principal debt balance of $80.0 million under the Hercules Loan Agreement with Hercules and SVB.

On November 1, 2024, we entered into the Pharmakon Loan Agreement.

We drew the Tranche A Loan of $125.0 million on November 1, 2024, a portion of which was utilized to repay all outstanding indebtedness associated with the Hercules Loan Agreement.

The Pharmakon Loan Agreement provides two additional committed term loan tranches, the Tranche B Loan and the Tranche C Loan, in principal amounts of $75.0 million and $50.0 million, respectively, subject to customary conditions to fund and, in the case of the Tranche C Loan, achieving certain minimum net sales milestone.

The Tranche B Loan and the Tranche C Loan may be requested on or prior to December 31, 2025.

The Term Loans mature on November 1, 2029.

The Term Loans bear interest at a variable rate per annum equal to 5.75% plus three-month SOFR with a SOFR floor of 3.00%.

On November 1, 2024, we entered into a the Royalty Pharma Agreement with Royalty Pharma.

Pursuant to the Royalty Pharma Agreement, we received the Purchase Price in exchange for which Royalty Pharma obtained the right to receive the Revenue Interest Payments.

There are no other royalties payable on RYTELO, which was developed internally and is exclusively owned by Geron.

We have an investment policy to invest our cash in liquid, investment grade securities, such as interest-bearing money market funds, certificates of deposit, U.S.

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Future Funding Requirements

Based on our current operating plans and assumptions, we believe that our existing cash, cash equivalents, and current and noncurrent marketable securities, together with projected revenues from U.S.

sales of RYTELO, will be sufficient to fund our projected operating requirements into the second quarter of 2026.

Based on our current operating plans and assumptions, we believe that our existing cash, cash equivalents, and marketable securities (including the $250 million received under the Pharmakon Loan Agreement and the Royalty Pharma Agreement), together with anticipated revenues from U.S.

sales of RYTELO, will be sufficient to fund our projected operating requirements for at least the next 12 months from the date of this filing.

We believe that our projected financial resources will be sufficient to (i) support commercial launch of RYTELO in the U.S.

Despite recent FDA approval of RYTELO, the outcome of any clinical activities and/or regulatory approval process is highly uncertain, we cannot reasonably estimate whether our future development activities may succeed;

Despite FDA approval of RYTELO in June 2024, the outcome of any clinical activities and/or regulatory approval process is highly uncertain, we cannot reasonably estimate whether our future development activities may succeed;

whether we will obtain regulatory approval for RYTELO in the EU in lower-risk MDS, or in any other jurisdictions or indications we are pursuing or may in the future pursue, or whether we will be able to effectively commercialize RYTELO in the U.S.

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• the level of sales and market acceptance of RYTELO;

• the scope, progress, timing, magnitude and costs of non-clinical and clinical development, manufacturing and commercialization of imetelstat, including potential commercialization in the EU for lower-risk MDS, or in any other jurisdictions or other indication we may pursue, subject to clearances and approvals by the FDA and similar international regulatory authorities;

• the scope, progress, timing, magnitude and costs of non-clinical and clinical development, manufacturing and commercialization of imetelstat, including potential commercialization in the EU for lower-risk MDS, if approved, or in any other jurisdictions or other indication we may pursue, subject to clearances and approvals by the FDA and similar international regulatory authorities;

• delays or disruptions in opening sites, screening and enrolling patients or treating and following patients, in our current or any potential future clinical trials of RYTELO;

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• the extent to which we acquire or in-license other drugs and technologies, or invest in businesses, products or technologies, although we currently have no commitments or agreements relating to any of these types of transactions, or to which we out-license RYTELO;

• the extent to which we are able to enter into and conduct successful strategic partnerships, collaborations, alliances or licensing arrangements with third parties, including for the commercialization and marketing of RYTELO in certain regions outside of the U.S., if approved for commercialization;

• the extent to which we are able to enter into and conduct successful arrangements with third parties, including for the commercialization and marketing of RYTELO in certain regions outside of the U.S., if approved for commercialization;

• the extent and scope of our selling, general and administrative expenses, including expenses associated with potential future litigation;

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Additional financing through public or private debt or equity financings, including pursuant to the 2023 Sales Agreement with B.

Riley Securities, Inc., the final $25.0 million tranche under the Loan Agreement, which is subject to the approval by an investment committee comprised of Hercules and SVB, capital lease transactions or other financing sources, may not be available on acceptable terms, or at all.

We may be unable to raise equity capital, or may be forced to do so at a stock price or on other terms that could result

in substantial dilution of ownership for our stockholders.

Riley Securities, Inc., the Tranche B Loan and the Tranche C Loan under the Pharmakon Loan Agreement, which is subject to certain funding conditions, capital lease transactions or other financing sources, may not be available on acceptable terms, or at all.

We may be unable to raise equity capital, or may be forced to do so at a stock price or on other terms that could result in substantial dilution of ownership for our stockholders.

The receptivity of the public and private debt and equity markets to proposed financings has been substantially affected by uncertainty in the general economic, market and political climate due to the effects of macroeconomic or other global conditions, such as inflation, rising interest rates, prospects of a recession, government shutdowns, bank failures and other disruptions to financial systems, civil or political unrest, military conflicts, pandemics or other health crises and supply chain and resource issues, and may in the future be affected by other factors which are unpredictable and over which we have no control.

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To the extent that we raise additional capital through the sale of equity or convertible debt securities, including pursuant to the 2023 Sales Agreement, your ownership interest as a stockholder may be diluted, and the terms may include liquidation or other preferences that materially and adversely affect your rights as a stockholder.

In addition, we have borrowed, and in the future may borrow, additional capital from institutional and commercial banking sources to fund imetelstat development and our future growth, including pursuant to our Loan Agreement or potentially pursuant to new arrangements with different lenders.

We may borrow funds on terms under agreements, such as the Loan Agreement, that include restrictive covenants, including covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.

In addition, we have borrowed, and in the future may borrow, additional capital from institutional and commercial banking sources to fund imetelstat development and our future growth, including pursuant to the Pharmakon Loan Agreement or potentially pursuant to new arrangements with different lenders.

We may borrow funds on terms under agreements, such as the Pharmakon Loan Agreement, that include restrictive covenants, including covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.

Moreover, if we raise additional funds through alliance, collaborative or licensing arrangements with third parties, we may have to relinquish valuable rights to RYTELO or our technologies or grant licenses on terms that are not favorable to us.

We cannot assure you that our existing capital resources, future interest income, future revenues from sales of RYTELO, potential future sales of our common stock, including under the 2023 Sales Agreement, will be sufficient to fund our operating plans.

Moreover, while we did not hold cash deposits or securities at SVB, if other banks and financial institutions enter receivership, become insolvent or otherwise fail in the future in response to financial conditions affecting the banking system and financial markets or otherwise, our ability to access our cash, cash equivalents and marketable securities may be delayed or precluded, which could have a material adverse effect on our business, business prospects and financial position.

Cash Flows from Operating Activities

Net cash used in operations for the six months ended June 30, 2024 and 2023 was $115.7 million and $76.0 million, respectively.

The increase in net cash used in operations for the six months ended June 30, 2024, compared to the same period in 2023, primarily reflects an increase in net loss to $122.8 million, adjusted for non-cash items including stock based compensation expense related for employees and directors.

Net cash used in operations for the nine months ended September 30, 2024 and 2023 was $174.7 million and $126.8 million, respectively.

The increase in net cash used in operations for the nine months ended September 30, 2024, compared to the same period in 2023, primarily reflects an increase in net loss to $149.2 million, adjusted for non-cash items including stock based compensation expense related for employees and directors.

Cash Flows from Investing Activities

Net cash used by investing activities was $1.9 million for the six months ended June 30, 2024 and $223.2 million for the six months ended June 30, 2023.

The decrease in net cash used in investing activities for the six months ended June 30, 2024, compared to the same period in 2023, primarily reflects decreased purchases of marketable securities, as well as increased proceeds from maturities of marketable securities.

Net cash used in investing activities was $2.5 million for the nine months ended September 30, 2024 and $227.9 million for the nine months ended September 30, 2023.

The decrease in net cash used in investing activities for the nine months ended September 30, 2024, compared to the same period in 2023, primarily reflects decreased purchases of marketable securities, as well as increased proceeds from maturities of marketable securities.

Cash Flows from Financing Activities

Net cash provided by financing activities for the six months ended June 30, 2024 and 2023 was $164.6 million and $299.4 million, respectively.

Net cash provided by financing activities for the nine months ended September 30, 2024 and 2023 was $168.2 million and $328.7 million, respectively.

Financing activities in 2024 primarily reflect an underwriting offering of 41,999,998 shares of common stock and a pre-funded warrant to purchase 8,002,668 shares of common stock, resulting in net cash proceeds of $141.0 million completed in March 2024.

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Our material cash requirements in the short- and long-term consist of the following operational and manufacturing expenditures, a portion of which contain contractual or other obligations.

We plan to fund our material cash requirements with our current financial

resources and may consider additional funding through a combination of additional equity and debt financings, new collaborative arrangements, strategic alliances, or from other sources.

We plan to fund our material cash requirements with our current financial resources and may consider additional funding through a combination of additional equity and debt financings, new collaborative arrangements, strategic alliances, or from other sources.

Contractual Obligations

We have entered into arrangements that contractually obligate us to make payments that will affect our liquidity and cash flows in future periods.

Our contractual obligations primarily consist of our current and noncurrent debt obligations under the Loan Agreement with Hercules and SVB, as described above and in Note 4 on Debt in Notes to Condensed Consolidated Financial Statements of this quarterly report on Form 10-Q, and obligations under non-cancellable operating leases.

The aggregate amount of our future operating lease payments was reported in our 2023 Form 10-K and there have been no changes to the contractual terms of our operating leases during the six months ended June 30, 2024.

Our contractual obligations as of September 30, 2024 primarily consisted of our current and noncurrent debt obligations under the Hercules Loan Agreement with Hercules and SVB, as described above and in Note 6 on Debt in Notes to Condensed Consolidated Financial Statements of this Report, and obligations under non-cancellable operating leases.

Subsequent to September 30, 2024, we entered into the Pharmakon Loan Agreement, as described above in Note 9 on Subsequent Events to Condensed Consolidated Financial Statements of this Report.

We have engaged third‑party contract manufacturers and have re-established our own manufacturing supply chain to manufacture and supply additional quantities of RYTELO that meet applicable regulatory standards for current and potential future clinical trials and commercial uses.

Related to those contract manufacturing agreements, we have noncancelable commercial purchase commitments for approximately $62.5 million in the aggregate as of June 30, 2024.

Related to those contract manufacturing agreements, we have noncancelable commercial purchase commitments for approximately $62.4 million in the aggregate as of September 30, 2024.

These purchase commitments can vary based on the commercial demand of RYTELO and are binding based on future manufacturing needs.

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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

During the three months ended June 30, 2024, there were no material changes to our quantitative and qualitative disclosures about market risk as set forth in Part II, Item 7A "Quantitative and Qualitative Disclosures About Market Risk" of our 2023 Form 10-K,

During the three months ended September 30, 2024, there were no material changes to our quantitative and qualitative disclosures about market risk as set forth in Part II, Item 7A "Quantitative and Qualitative Disclosures About Market Risk" of our 2023 Form 10-K,

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 2. Management’s Discussion and Analysis