What changed in this filing

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Item 1. Financial Statements

2026-07-31 compared with 2026-05-07 · 190 added, 143 removed, 338 unchanged (50% of the section changed)

11 unchanged sentences

Property and equipment, net

Restricted cash and cash equivalents, net of current portion

Restricted cash and cash equivalents

Operating lease right of use asset

7 unchanged sentences

Note payable, net of discount and issuance costs

28,831 28,236

Total current liabilities

38,519 36,148

Operating lease liability, net of current portion

1 unchanged sentence

Total liabilities

45,820 44,591

Commitments and contingencies

Stockholders’ equity:

Preferred stock, $ 0.0001 par value, 5,000,000 shares authorized as of March 31, 2026 and December 31, 2025;

no shares issued or outstanding as of March 31, 2026 and December 31, 2025

Common stock, $ 0.0001 par value, 200,000,000 shares authorized as of March 31, 2026 and December 31, 2025;

48,596,817 shares issued and outstanding as of March 31, 2026 and December 31, 2025

Preferred stock, $ 0.0001 par value, 5,000,000 shares authorized as of June 30, 2026 and December 31, 2025;

no shares issued or outstanding as of June 30, 2026 and December 31, 2025

Common stock, $ 0.0001 par value, 200,000,000 shares authorized as of June 30, 2026 and December 31, 2025;

48,599,066 and 48,596,817 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively

Additional paid-in capital

11 unchanged sentences

Three Months Ended

Six Months Ended

2026 2025 2026 2025

Collaboration revenue $ 21,000 $ — $ 21,000 $ —

Operating expenses:

2 unchanged sentences

General and administrative

7,680 4,399 12,770 9,270

Total operating expenses

13,842 17,542 27,113 35,533

Operating loss

Operating income (loss)

7,158 ( 17,542 ) ( 6,113 ) ( 35,533 )

2 unchanged sentences

Interest expense ( 475 ) ( 1,301 ) ( 1,843 ) ( 2,564 )

Loss on extinguishment of note payable ( 3,354 ) — ( 3,354 ) —

Other income, net 64 11 738 179

Total other expense ( 3,488 ) ( 440 ) ( 3,749 ) ( 538 )

$ ( 13,532 ) $ ( 18,089 )

Net loss per common share, basic

$ ( 0.28 ) $ ( 0.40 )

Net loss per common share, diluted

$ ( 0.28 ) $ ( 0.40 )

Weighted-average common shares outstanding, basic

48,596,817 44,827,159

Weighted-average common shares outstanding, diluted

Net income (loss)

$ 3,670 $ ( 17,982 ) $ ( 9,862 ) $ ( 36,071 )

Net income (loss) per common share, basic and diluted $ 0.08 $ ( 0.40 ) $ ( 0.20 ) $ ( 0.80 )

Weighted-average common shares outstanding, basic and diluted 48,597,534 44,981,746 48,597,177 44,904,880

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

9 unchanged sentences

Balance at March 31, 2026 48,596,817 5 501,139 ( 488,942 ) 12,202

Issuance of common stock, net 2,249 — 1 — 1

Stock-based compensation expense — — 419 — 419

— — — 3,670 3,670

Balance at June 30, 2026 48,599,066 $ 5 $ 501,559 $ ( 485,272 ) $ 16,292

Additional Paid-in Capital

5 unchanged sentences

Balance at March 31, 2025 44,827,159 5 489,979 ( 432,677 ) 57,307

Issuance of common stock from at the market offering, net of issuance costs of $ 255

421,766 — 305 — 305

Issuance of common stock, net 86,340 — 41 — 41

Stock-based compensation expense — — 1,793 — 1,793

— — — ( 17,982 ) ( 17,982 )

Balance at June 30, 2025 45,335,265 $ 5 $ 492,118 $ ( 450,659 ) $ 41,464

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

2 unchanged sentences

(amounts in thousands)

Three Months Ended

Six Months Ended

Operating activities:

3 unchanged sentences

Depreciation expense

Loss on sale and disposal of property and equipment, net 159 —

Non-cash interest expense 771 1,010

Non-cash lease expense

Loss on extinguishment of note payable 3,354 —

Change in fair value of derivative liability

( 707 ) ( 190 )

Gain on modification of lease liability ( 1,142 ) —

Changes in operating assets and liabilities:

6 unchanged sentences

( 3,968 ) ( 34,112 )

Investing activities:

Proceeds from sale of property and equipment

Net cash provided by investing activities

Financing activities:

Repayment of note payable and extinguishment costs ( 32,413 ) —

Proceeds from at the market offering of common stock, net of issuance costs — 347

Proceeds from issuances under Employee Stock Purchase Plan

Net cash (used in) provided by financing activities

( 32,412 ) 388

Net decrease in cash, cash equivalents and restricted cash and cash equivalents

7 unchanged sentences

$ 21,987 $ 77,596

Prepaid expenses and other current assets 904 334

Restricted cash and cash equivalents, net of current portion

Restricted cash and cash equivalents — 895

Total cash, cash equivalents and restricted cash and cash equivalents $ 21,987 $ 78,491

2 unchanged sentences

Supplemental disclosure of non-cash investing and financing activities:

Adjustment to right of use asset in exchange for reduction in lease liability $ 4,909 $ —

Issuance costs in accounts payable and accrued expenses

26 unchanged sentences

There can be no assurance that the strategic review process will result in any agreement or transaction that will enhance stockholder value, or any agreement or transaction at all.

As part of the 2026 Restructuring, our board of directors approved a reduction in force, representing 64 % of our workforce to better align our resources with our pursuit of strategic alternatives.

As part of the 2026 Restructuring, our board of directors approved a reduction in force in February 2026, representing 64 % of our workforce to better align our resources with our pursuit of strategic alternatives.

In May 2026, an additional reduction in force occurred, representing 36 % of our workforce at that time.

See Note 12 for further discussion of the impact of the 2026 Restructuring.

We had cash and cash equivalents of $ 46.5 million at March 31, 2026.

We had cash and cash equivalents of $ 22.0 million at June 30, 2026.

The outcome of our strategic review process will inform future development plans and the costs associated with those efforts.

7 unchanged sentences

Basis of Presentation and Consolidation

The accompanying condensed consolidated financial statements as of March 31, 2026 and December 31, 2025, and for the three months ended March 31, 2026 and 2025, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) and generally accepted accounting principles in the United States of America (“GAAP”) as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”) for condensed consolidated financial information.

The accompanying condensed consolidated financial statements as of June 30, 2026 and December 31, 2025, and for the three and six months ended June 30, 2026 and 2025, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) and generally accepted accounting principles in the United States of America (“GAAP”) as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”) for condensed consolidated financial information.

Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.

In the opinion of management, these condensed consolidated financial statements reflect all normal recurring adjustments which are necessary for a fair presentation

of our financial position and results of our operations, as of and for the periods presented.

In the opinion of

management, these condensed consolidated financial statements reflect all normal recurring adjustments which are necessary for a fair presentation of our financial position and results of our operations, as of and for the periods presented.

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on March 27, 2026 (the “2025 Annual Report”).

The information presented in the condensed consolidated financial statements and related notes as of March 31, 2026, and for the three months ended March 31, 2026 and 2025, is unaudited.

The information presented in the condensed consolidated financial statements and related notes as of June 30, 2026, and for the three and six months ended June 30, 2026 and 2025, is unaudited.

The December 31, 2025 condensed consolidated balance sheet included herein was derived from the audited financial statements as of that date, but does not include all disclosures, including notes, required by GAAP for complete financial statements.

Interim results for the three months ended March 31, 2026 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2026, or any future period.

Interim results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2026, or any future period.

The accompanying condensed consolidated financial statements include the accounts of Werewolf Therapeutics, Inc.

3 unchanged sentences

The significant accounting policies and estimates used in the preparation of the condensed consolidated financial statements are described in our audited financial statements as of and for the year ended December 31, 2025, and the notes thereto, which are included in our 2025 Annual Report.

Other than as set forth below, there have been no material changes in our significant accounting policies during the three months ended March 31, 2026.

Other than as set forth below, there have been no material changes in our significant accounting policies during the six months ended June 30, 2026.

Use of Estimates

13 unchanged sentences

Other than as described in Note 13, we did not identify any subsequent events that require adjustment or disclosure in the condensed consolidated financial statements.

Collaboration Revenue

In April 2022, we entered into an exclusive global collaboration and license agreement (the “Collaboration Agreement”) with Jazz Pharmaceuticals Ireland Limited (“Jazz”) pursuant to which we granted Jazz certain licenses to develop and commercialize products containing our Interferon alpha (“IFNα”) INDUKINE™ molecule, JZP898 (the “898 Program”), as well as products containing certain isolated recombinant polypeptides comprising IFNα that meet specified criteria (each such product, a “Licensed Product”).

Under the Collaboration Agreement, we were responsible for certain preclinical development activities with respect to JZP898 and other development activities specified in mutually agreed upon development plans.

Jazz had generally reimbursed us for the cost of such activities.

Jazz is responsible for all other development and commercialization activities conducted to exploit the Licensed Products, including submission of an investigational new drug application (“IND”) to the U.S.

Food and Drug Administration (the “FDA”).

In June 2024, we executed a transfer agreement (the “Transfer Agreement”) to assign our rights in a development agreement with a contract manufacturer of JZP898 to Jazz.

The execution of this Transfer Agreement was the last material performance obligation required of us under the Collaboration Agreement.

We were eligible to receive up to $ 515.0 million in development and regulatory milestones, and up to $ 740.0 million in sales-based milestones for all Licensed Products upon meeting certain conditions.

On May 6, 2026 (the “Closing”), we entered into an asset purchase agreement (the “Purchase Agreement”) with Jazz.

Subject to the terms and conditions of the Purchase Agreement, we sold to Jazz the 898 Program for the development, manufacturing, commercialization, use and other exploitation of the Licensed Product.

Pursuant to the Purchase Agreement and related ancillary agreements, in consideration for all material assets, properties, rights and interests used or held for use in the conduct of the 898 Program, Jazz paid us upfront consideration of $ 21.0 million, and has agreed to pay an additional $ 2.0 million upon the consent to the partial assignment of a certain license agreement, as and to the extent such agreement relates to the conduct of the 898 Program.

Jazz also assumed certain liabilities of ours relating to the 898 Program arising after the Closing.

The Purchase Agreement contains customary representations, warranties and covenants of each of us and Jazz.

The Purchase Agreement further provides that, subject to certain limitations, we and Jazz will each indemnify the other for certain losses arising from such breaches of representations, warranties and covenants and liabilities allocated to such party pursuant to the terms of the Purchase Agreement.

In addition, the Purchase Agreement contains a non-competition covenant pursuant to which we agreed not to exploit any IFNα or variant thereof, or any product containing any IFNα or variant thereof, for a period of eighteen ( 18 ) months after the Closing, subject to customary exceptions for change of control transactions.

Effective as of the Closing, the Collaboration Agreement was terminated, and as a result, we are no longer eligible to receive payment for meeting the conditions of the development and regulatory milestones or sales-based milestones for any Licensed Products.

Concurrently with the Purchase Agreement, we also entered into a license agreement (the “New License Agreement”) with Jazz to license to them certain patents and “know-how” (the “Licensed Patents” and “Licensed Know-How,” respectively).

The Licensed Patents and the Licensed Know-How are necessary in the development of the 898 Program, however are not exclusive to the 898 Program.

Accounting Analysis under ASC 606

Identification of the Contracts(s)

We have previously concluded that the Collaboration Agreement represents a contract with a customer within the scope of ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”).

We have assessed the Purchase Agreement and the New License Agreement, and have concluded that they represent a single combined arrangement due to the fact that they were negotiated as a package with a single commercial objective.

We have further concluded that the Purchase Agreement and the New License Agreement represent a modification to the Collaboration Agreement within the scope of ASC 606.

Identification of Promises and Performance Obligations

Previously, we have concluded that the license granted to Jazz under the Collaboration Agreement, and the corresponding “know-how” are not capable of being distinct from the other promises within the contract, and as such, determined that the license and the “know-how” combined with the other research and development services and supply represent a single combined performance obligation.

Under the Purchase Agreement and the New License Agreement, Jazz continues to have rights to the same patents and “know-how” that were granted under the Collaboration Agreement.

However, under the Purchase Agreement, we transferred ownership of certain patents and “know-how” to Jazz.

At the time of the Closing, our performance obligation to Jazz had been fulfilled.

Determination of Transaction Price

We have assessed the Purchase Agreement and the New License Agreement, and have concluded that they represent a modification that results in an increase in the overall transaction price of the contract with Jazz.

We’ve determined that the upfront consideration included in the Purchase Agreement of $ 21.0 million should be added to the overall transaction price.

The Purchase Agreement also includes a $ 2.0 million contingent payment that is payable to us upon the successful partial assignment of a certain license agreement.

We’ve determined that this contingent payment represents variable consideration that should not be included in the transaction price.

We used the most likely amount method to estimate variable consideration and estimated that the most likely amount of the contingent payment was zero at the Closing as the success of completing the partial assignment of the license agreement is highly susceptible to factors outside of our control.

The Collaboration Agreement included various development and regulatory and sales-based milestones.

The payments associated with these milestones represented variable consideration that were excluded from the overall transaction price at the inception of the Collaboration Agreement.

As of the Closing, we are no longer entitled to receipt of payment for any of the unpaid milestones included in the Collaboration Agreement.

Accordingly, the unpaid milestone payments are no longer considered for inclusion in the overall transaction price as of the Closing.

We re-evaluate the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur, and adjust the transaction price as necessary.

During the period from the Closing through June 30, 2026, we did not recognize any adjustment to the transaction price associated with the contingent payment.

Revenue Recognition

As noted above, we have no remaining performance obligation to Jazz as of the Closing.

Accordingly, we have recognized revenue of $ 21.0 million during the three and six months ended June 30, 2026 related to the increase in the overall transaction price described above.

As of June 30, 2026, all consideration included in the overall transaction price has been recognized as revenue.

Financial Instruments and Fair Value Measurements

Our assets that are required to be measured at fair value on a recurring basis consist of money market funds classified as cash and cash equivalents on our condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025.

Our liabilities that are required to be measured at fair value on a recurring basis consist of a derivative liability pursuant to a loan and security agreement (the “K2HV Loan Agreement”) with K2 HealthVentures LLC (“K2HV”) (see Note 6, Term Loan ) on our condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025.

Our liabilities that are required to be measured at fair value on a recurring basis consist of a derivative liability pursuant to a loan and security agreement (the “K2HV Loan Agreement”) with K2 HealthVentures LLC (“K2HV”) (see Note 7, Term Loan ) on our condensed consolidated balance sheet as of December 31, 2025.

We do not have any liabilities that are required to be measured at fair value on a recurring basis as of June 30, 2026.

The carrying amounts reflected in the condensed consolidated balance sheets for cash, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values, due to their short-term nature.

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2026 were as follows:

Assets measured at fair value on a recurring basis as of June 30, 2026 were as follows:

(in thousands)

2 unchanged sentences

$ 21,489 $ — $ — $ 21,489

Derivative liability

$ — $ — $ 85 $ 85

Total liabilities

$ — $ — $ 85 $ 85

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 were as follows:

7 unchanged sentences

$ — $ — $ 759 $ 759

There were no changes in valuation techniques used during the three months ended March 31, 2026.

There were no changes in valuation techniques used during the three or six months ended June 30, 2026.

Derivative Liability

2 unchanged sentences

The Fixed Price Conversion and Variable Price Conversion within the K2HV Loan Agreement were required to be bifurcated as a single compound embedded derivative carried at fair value, with subsequent changes in fair value recognized in the condensed consolidated statements of operations.

In May 2026, we repaid all amounts owed under K2HV Loan Agreement, as described in Note 7.

Upon repayment of the outstanding principal of the term loan, the lenders’ ability to exercise the conversion option expired.

The following table reconciles the change in fair value of the derivative liability based on Level 3 inputs:

Three Months Ended March 31,

Six Months Ended June 30,

(in thousands)

1 unchanged sentence

Change in fair value ( 707 ) ( 190 )

Extinguishment of note payable ( 52 ) —

Balance at end of period $ — $ 2,639

The change in fair value of the derivative liability is included in other income, net in the accompanying condensed consolidated statements of operations.

We recognized gains of $ 0.7 million and $ 0.2 million related to change in fair value of the derivative liability during the three months ended March 31, 2026 and 2025, respectively.

We recognized nominal gains related to change in fair value of the derivative liability during the three months ended June 30, 2026 and 2025.

We recognized gains of $ 0.7 million and $ 0.2 million related to change in fair value of the derivative liability during the six months ended June 30, 2026 and 2025, respectively.

The fair value of the derivative liability immediately prior to repayment of the amounts owed under K2HV Loan Agreement was written off and is included in the loss on extinguishment of note payable in the accompanying condensed consolidated statement of operations in the amount of $ 0.1 million for the three and six months ended June 30, 2026.

The fair value of the derivative liability in the term loan was estimated using the Monte Carlo and the Black-Scholes models, each weighted based on the probable outcomes of various scenarios.

A summary of the weighted-average significant unobservable inputs (Level 3 inputs) used in measuring the derivative liability in the term loan is as follows:

2026 December 31,

A summary of the weighted-average significant unobservable inputs (Level 3 inputs) used in measuring the derivative liability in the term loan as of December 31, 2025 is as follows:

Stock price $ 0.63

3 unchanged sentences

Dividend yield (continuous) — %

On May 6, 2026, we repaid all amounts owed under the K2HV Loan Agreement, as described further in Note 12.

No portion of the Fixed Price Conversion or the Variable Price Conversion had been exercised prior to the repayment of the term loans.

Accrued Expenses and Other Current Liabilities

2 unchanged sentences

(in thousands)

Professional fees $ 1,719 $ 1,388

Contract research $ 3,189 $ 2,376

Restructuring costs 443 —

Accrued interest 266 266

Professional fees 2,316 1,388

Employee compensation and benefits 211 302

Manufacturing 90 928

Other 214 147

Restructuring costs 34 —

Accrued interest — 266

Total accrued expenses and other current liabilities

8 unchanged sentences

Our ability to draw upon the third tranche commitment expired on June 30, 2025 without being drawn upon.

A fourth tranche commitment of up to $ 20.0 million was available to be drawn at our option through May 1, 2026, subject to Lender’s review of our clinical, financial and operating plan and subject to the Lender’s consent in its sole and absolute discretion.

consent in its sole and absolute discretion.

Our ability to draw upon the fourth tranche commitment expired on May 1, 2026 without being drawn upon.

The term loan was scheduled to mature on May 1, 2028, and we were obligated to make interest only payments for the first 24 months followed by interest and equal principal payments each month thereafter through the maturity date.

The term loan was scheduled to mature on May 1, 2028, and we were obligated to make interest only payments for the first 24 months followed by equal interest and principal payments each month thereafter through the maturity date.

The term loan bore a variable interest rate equal to the greater of (i) 10.3 %, and (ii) the sum of (A) the prime rate last quoted in The Wall Street Journal (or a comparable replacement rate if The Wall Street Journal ceases to quote such rate) and (B) 1.8 %.

We could prepay, at our option, all, but not less than all, of the outstanding principal balance and all accrued and unpaid interest with respect to the principal balance being prepaid of the term loans, subject to a prepayment premium to which the Lenders were entitled and certain notice requirements.

We were obligated to pay a final fee equal to 6.95 % of the aggregate amount of the term loans funded, or the Final Fee, to occur upon the earliest of (i) the maturity date, (ii) the acceleration of the term loans, and (iii) the prepayment of the term loans.

We were obligated to pay a final fee equal to 6.95 % of the aggregate amount of the term loans funded (the “Final Fee”) to occur upon the earliest of (i) the maturity date, (ii) the acceleration of the term loans, and (iii) the prepayment of the term loans.

The Final Fee was being accreted to interest expense using the effective interest method over the life of the debt.

The Lenders had the option, prior to the full repayment of the term loans, to convert up to $ 5.0 million of outstanding principal of the term loans into shares of our common stock, pursuant to the Fixed Price Conversion or the Variable Price Conversion,

subject to customary adjustments and 9.99 % and 19.99 % beneficial ownership limitations.

There would have been no prepayment penalty for any principal amount converted into common stock.

4 unchanged sentences

Upon the occurrence of an event of default, a default interest rate of an additional 5.0 % per annum may have been applied to the outstanding loan balances, and the Lenders may have declared all outstanding obligations immediately due and payable and exercised all of their rights and remedies as set forth in the K2HV Loan Agreement and under applicable law.

As of March 31, 2026, we were in compliance with all covenants.

Subject to certain conditions, we granted the Lenders the right, prior to repayment of the term loans, to invest up to $ 5.0 million in the aggregate in future offerings of capital stock, at market terms, subject to certain exceptions and conditions.

1 unchanged sentence

These debt issuance costs, together with the fair value of the embedded derivative of $ 4.5 million at inception of the K2HV Loan Agreement, resulted in a debt discount of $ 5.1 million which was being amortized to interest expense over the term of the K2HV Loan Agreement using the effective interest method.

As of March 31, 2026, the fair value of the term loan was estimated to be approximately $ 29.7 million.

The fair value was measured using a discounted cash flow analysis, specifically the yield method, which requires the use of Level 3 inputs in the fair value hierarchy.

The outstanding term loans payable consists of the following:

2026 December 31,

(in thousands)

On May 6, 2026, we entered into a letter agreement providing for the repayment by us of all amounts owed under the K2HV Loan Agreement.

On May 6, 2026, upon payment by us of $ 31.4 million, all of our indebtedness and obligations to the Collateral Trustee and the Lenders under the K2HV Loan Agreement and any other related loan and collateral security documents was deemed paid and discharged in full.

During the three and six months ended June 30, 2026, we recognized a loss on the extinguishment of debt in the amount of $ 3.4 million, primarily due to the write off of unamortized debt issuance costs and the unaccreted balance of the Final Fee.

The outstanding note payable consisted of the following as of December 31, 2025 (in thousands) :

Note payable $ 30,000

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

(in thousands)

Interest expense based on coupon interest rate ( 10.3 %) of outstanding term loans

$ 299 $ 781 $ 1,072 $ 1,554

Amortization of debt discount and accretion of Final Fee ( 8.94 %)

176 520 771 1,010

Total interest expense on effective rate ( 19.24 %)

$ 475 $ 1,301 $ 1,843 $ 2,564

The following table presents the total principal payments and Final Fee that were contractually scheduled to become due during each of the years ended December 31 (in thousands):

Principal Payments and Final Fee

(in thousands)

2026 (remaining as of March 31, 2026)

Total principal payments and Final Fee $ 32,085

We have presented the full amount of the term loan payable, net of discount and issuance costs, as a current liability as of March 31, 2026 and December 31, 2025 given the potential that the loan may be repaid in the subsequent twelve months of each period.

On May 6, 2026, we entered into a letter agreement discussed in more detail in Note 12, that resulted in the satisfaction of all obligations under the K2HV Loan Agreement.

We had presented the full amount of the term loan payable, net of discount and issuance costs, as a current liability as of December 31, 2025 based on our assessment that repayment of the loan was probable in the subsequent twelve months of December 31, 2025.

Common and Preferred Stock

1 unchanged sentence

Common stockholders are entitled to dividends if and when declared by our board of directors.

As of March 31, 2026, no dividends on common stock had been declared by us.

As of June 30, 2026, no dividends on common stock had been declared by us.

On May 10, 2022, we entered into a Sales Agreement (the “Sales Agreement”) with Leerink Partners LLC (“Leerink Partners”), pursuant to which we are entitled to offer and sell shares of our common stock (the “ATM Offering”).

2 unchanged sentences

On May 8, 2025, we filed a new Registration Statement on Form S-3 and filed a new prospectus covering the ATM Offering (the “Prospectus”) for the offer and sale of shares of our common stock with an aggregate offering price of up to $ 12.5 million in the ATM Offering as a result of being subject to General Instruction I.B.6 of Form S-3 (the “Baby Shelf Limitation”).

As of March 31, 2026, we remain subject to the Baby Shelf Limitation.

During the three months ended March 31, 2026 and 2025, we did not sell any shares of our common stock under the ATM Offering.

As of June 30, 2026, we remain subject to the Baby Shelf Limitation.

During the six months ended June 30, 2026, we did not sell any shares of our common stock under the ATM Offering.

During the six months ended June 30, 2025, we sold 421,766 shares of our common stock at an average price of $ 1.33 per share for net proceeds of $ 0.3 million after deducting sales commissions and offering expenses.

We have reserved shares of common stock for issuance as follows:

As of March 31, 2026 As of December 31, 2025

As of June 30, 2026 As of December 31, 2025

Shares reserved for exercises of outstanding stock options

5 unchanged sentences

Shares reserved for issuance as part of the K2HV Loan Agreement conversion feature

791,364 791,364

Total shares reserved for future issuance

2 unchanged sentences

We are authorized to issue 5,000,000 shares of undesignated preferred stock in one or more series.

As of March 31, 2026, no shares of preferred stock were issued or outstanding.

As of June 30, 2026, no shares of preferred stock were issued or outstanding.

Stock-based Compensation

10 unchanged sentences

The 2021 Plan also provides that an additional number of shares will be added annually to the shares authorized for issuance under the 2021 Plan on the first day of each fiscal year, beginning with the fiscal year ending December 31, 2022 and continuing until, and including, the fiscal year ending December 31, 2031.

The number of shares added each year will be equal to the lesser of (i) 5 %

of the number of shares of outstanding common stock on such date and (ii) such amount as determined by our board of directors.

As of March 31, 2026, a cumulative total of 9,582,699 additional shares have been added to the total shares authorized for issuance under the 2021 Plan in accordance with these terms.

The number of shares added each year will be equal to the lesser of (i) 5 % of the number of shares of outstanding common stock on such date and (ii) such amount as determined by our board of directors.

As of June 30, 2026, a cumulative total of 9,582,699 additional shares have been added to the total shares authorized for issuance under the 2021 Plan in accordance with these terms.

2021 Employee Stock Purchase Plan

2 unchanged sentences

The purchase price of each of the shares purchased, in a given purchase period, will be equal to 85 % of the lesser of the closing price of a share of our common stock on (i) the first day of the offering period, or (ii) the last day of the offering period.

During the three months ended March 31, 2026 and 2025, no shares of our common stock were purchased by participants of the 2021 ESPP.

During the six months ended June 30, 2026 and 2025, 2,249 and 39,853 shares of our common stock, respectively, were purchased by participants of the 2021 ESPP.

Stock-Based Compensation Expense

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

(in thousands)

2 unchanged sentences

General and administrative

336 820 762 1,771

Total stock-based compensation

1 unchanged sentence

As part of the severance benefits offered to former employees impacted by the 2026 Restructuring described in Note 2 (the “Former Employees”), the forfeiture conditions of outstanding stock options belonging to the Former Employees were modified such that the Former Employees will retain their rights to exercise their stock options through the original expiration dates of each respective stock option to the extent that such stock options had become vested at the time that the Former Employees’ employment with us was terminated.

Absent this modification, the impacted stock options would have been forfeited by the Former Employees after a period of 90 days following the termination of their employment with us, if not exercised sooner.

The expiration date for all stock options impacted by this modification will occur on the tenth anniversary of the grant date of each respective stock option.

For the three months ended March 31, 2026, the stock-based compensation expense above includes $ 0.6 million of expense recognized as a one-time charge related to this modification.

Absent these modifications, the impacted stock options would have been forfeited by the Former Employees after a period of 90 days following the termination of their employment with us, if not exercised sooner.

The expiration date for all stock options impacted by these modifications will occur on the tenth anniversary of the grant date of each respective stock option.

For the three and six months ended June 30, 2026, the stock-based compensation expense above includes $ 0.1 million and $ 0.7 million, respectively, of expense recognized related to these modifications.

Stock Option Activity

No stock options were granted during the three months ended March 31, 2026.

The fair value of stock options granted during the three months ended March 31, 2025 was calculated on the date of grant using the following weighted-average assumptions:

No stock options were granted during the three or six months ended June 30, 2026.

The fair value of stock options granted during the three and six months ended June 30, 2025 were calculated on the date of grant using the following weighted-average assumptions:

Three Months Ended

June 30, 2025 Six Months Ended

June 30, 2025

Risk-free interest rate

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Expected volatility

Using the Black-Scholes option pricing model, the weighted-average grant date fair value of stock options granted during the three months ended March 31, 2025 was $ 1.22 per share.

The following table summarizes stock option activity during the three months ended March 31, 2026:

95.2 % 95.3 %

Using the Black-Scholes option pricing model, the weighted-average grant date fair value of stock options granted during the three and six months ended June 30, 2025 was $ 0.82 and $ 1.17 per share, respectively.

The following table summarizes stock option activity during the six months ended June 30, 2026:

Options Outstanding

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( 1,748,441 ) $ 2.23

Outstanding at March 31, 2026 8,440,233 $ 5.13 6.66 $ —

Exercisable at March 31, 2026 6,600,515 $ 5.97 6.15 $ —

No stock options were exercised during the three months ended March 31, 2026 and 2025.

As of March 31, 2026, we had unrecognized stock-based compensation expense related to unvested stock options of $ 2.6 million, which we expect to recognize over a weighted-average period of approximately 1.9 years.

Net Loss Attributable to Common Stockholders per Share

For purposes of the diluted net loss attributable to common stockholders per share calculation, outstanding stock options, the conversion option derivative under the K2HV Loan Agreement, and warrants to purchase common stock are considered to be potentially dilutive securities;

however, the following amounts were excluded from the weighted-average common stock outstanding in the calculation of diluted net loss attributable to common stockholders per share because their effect would be anti-dilutive:

Outstanding at June 30, 2026 8,206,431 $ 5.24 6.35 $ —

Exercisable at June 30, 2026 6,948,699 $ 5.77 6.02 $ —

No stock options were exercised during the three and six months ended June 30, 2026 and 2025.

As of June 30, 2026, we had unrecognized stock-based compensation expense related to unvested stock options of $ 2.0 million, which we expect to recognize over a weighted-average period of approximately 1.7 years.

Net Income (Loss) Attributable to Common Stockholders per Share

We reported net income for the three months ended June 30, 2026 and net losses for the six months ended June 30, 2026 and for the three and six months ended June 30, 2025.

For purposes of the diluted net income (loss) attributable to common stockholders per share calculation, outstanding stock options, common stock to be issued under the 2021 ESPP, and the conversion option derivative under the K2HV Loan Agreement are considered to be potentially dilutive securities;

however, the following amounts were excluded from the weighted-average common stock outstanding in the calculation of diluted net income (loss) attributable to common stockholders per share because their effect would have been anti-dilutive:

Outstanding stock options

8,206,431 10,461,702

Warrants to purchase common stock

Common stock to be issued under the 2021 ESPP — 70,602

Common stock to be issued upon exercise of the K2HV Loan Agreement conversion feature

8,206,431 11,323,668

As described below, the conversion option derivative under the K2HV Loan Agreement was determined to be dilutive for the three months ended March 31, 2026.

For the three months ended March 31, 2025, the effect of the conversion option derivative would have been anti-dilutive.

Accordingly, for the three months ended March 31, 2025, we have excluded 791,364 shares of common stock equivalents that are available to be issued in conjunction with the conversion option derivative from the calculation of diluted net loss attributable to common stockholders per share.

Basic net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during the applicable period.

In computing diluted net loss per share, only potential shares of common stock that are dilutive are included.

We considered each issue or series of issues of potential shares of common stock separately when determining whether potential shares of common stock are dilutive or anti-dilutive.

We made such determination in sequence from the most dilutive to the least dilutive and concluded that the conversion option derivative under the K2HV Loan Agreement is dilutive to net loss per share for the three months ended March 31, 2026.

Pursuant to ASC Topic 260, Earnings Per Share , we applied the if-converted method to determine the effect of the conversion option derivative under the K2HV Loan Agreement on the diluted earnings per share calculations.

Pursuant to such method, we adjusted the numerator for the gain recognized during the period in net loss due to the change in fair value of the conversion option derivative liability under the K2HV Loan Agreement and the interest expense recognized during the period that is attributable to the portion of the term loan that is subject to the conversion option.

We also increased the denominator to include the weighted-average number of additional shares of common stock that would have been outstanding if the conversion option derivative under the K2HV Loan Agreement were converted at the beginning of the period.

Three Months Ended March 31,

(in thousands)

Net loss $ ( 13,532 ) $ ( 18,089 )

change in fair value of derivative liability

interest expense on converted term loan

Adjusted net loss $ ( 14,007 ) $ ( 18,089 )

Weighted-average common stock outstanding, basic 48,596,817 44,827,159

Dilutive effect of common stock issuable from assumed conversion of convertible term loan

Weighted-average common stock outstanding, diluted 49,388,181 44,827,159

Net loss per share

Basic $ ( 0.28 ) $ ( 0.40 )

Diluted $ ( 0.28 ) $ ( 0.40 )

Segment Information

We have one reportable segment which focuses on the discovery and development of cancer therapeutics.

The segment derives its revenue from the Purchase Agreement with Jazz (see Note 4, Collaboration Revenue ).

Our chief operating decision maker (“CODM”) manages our operations on an integrated basis for the purpose of allocating resources.

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Segment assets regularly reviewed by our CODM include measures of liquidity, primarily available cash and cash equivalents, and are consistent with the presentation of cash and cash equivalents reported in our condensed consolidated balance sheets.

The following is a summary of our segment and consolidated net loss, including significant segment expenses:

The following is a summary of our segment and consolidated net income (loss), including significant segment expenses:

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

(in thousands)

Collaboration revenue $ 21,000 $ — $ 21,000 $ —

General and administrative support 6,678 3,486 11,250 7,309

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Other segment expenses (a)

2,871 2,199 4,198 4,631

Interest income 277 850 710 1,847

Interest expense ( 475 ) ( 1,301 ) ( 1,843 ) ( 2,564 )

Loss on extinguishment of note payable ( 3,354 ) — ( 3,354 ) —

Other income, net 64 11 738 179

Segment and consolidated net loss $ ( 13,532 ) $ ( 18,089 )

Segment and consolidated net income (loss) $ 3,670 $ ( 17,982 ) $ ( 9,862 ) $ ( 36,071 )

(a) Other segment expenses includes non-cash expenses for stock-based compensation and depreciation expenses.

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We estimate that we will incur approximately $ 6.5 million in costs associated with the 2026 Restructuring, consisting of severance payments, retention bonuses, employee benefits and related taxes, stock-based compensation, and contract termination costs.

Our estimate of costs we expect to incur and the expected timing of when the 2026 Restructuring will be

completed are subject to a number of assumptions, and actual results may differ.

We may also incur additional costs, including, but not limited to, potential impairment charges and debt extinguishment costs related to the subsequent events described in Note 12, and other events not currently contemplated that may occur as a result of, or that are associated with the 2026 Restructuring.

Our estimate of costs we expect to incur and the expected timing of when the 2026 Restructuring will be completed are subject to a number of assumptions, and actual results may differ.

We may also incur additional costs, including, but not limited to, potential impairment charges not currently contemplated that may occur as a result of, or that are associated with the 2026 Restructuring.

The following table summarizes the restructuring costs incurred and the total estimated costs expected to be incurred in connection with the 2026 Restructuring:

Three Months Ended March 31, 2026 Cumulative Costs to Date

Three Months Ended June 30, 2026 Six Months Ended June 30, 2026 Cumulative Costs to Date

Total Estimated Costs

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Employee severance, benefits and related taxes $ 83 $ 2,640 $ 2,640 $ 2,640

$ 2,557 $ 2,557 $ 2,557

Employee retention bonuses, benefits and related taxes 1,296 2,079 2,079 2,881

783 783 2,865

Stock-based compensation 50 665 665 665

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Total restructuring costs recognized in our condensed consolidated statements of operations were as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

(in thousands)

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Total restructuring costs

Accrued restructuring costs, which are included in accrued expenses and other current liabilities on our condensed consolidated balance sheets, were as follows:

Three Months Ended March 31,

(in thousands)

Balance at beginning of period

$ 1,379 $ — $ 5,684 $ —

Accrued restructuring costs, which are included in accrued expenses and other current liabilities on our condensed consolidated balance sheets were as follows (in thousands):

Balance as of December 31, 2025 $ —

Restructuring costs recognized during the period

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Non-cash charges recognized during the period

Balance at end of period

Subsequent Events

Asset Purchase Agreement;

Termination of Collaboration Agreement

On May 6, 2026 (the “Closing”), we entered into an asset purchase agreement (the “Purchase Agreement”) with Jazz Pharmaceuticals Ireland Limited, a corporation organized under the laws of Ireland (“Jazz”).

In April 2022, we entered into a global collaboration and license agreement (the “Collaboration Agreement”) with Jazz under which Jazz acquired exclusive global development and commercialization rights to JZP898, as well as products containing certain isolated recombinant polypeptides comprising IFNα that meet specified criteria (each such product, a Licensed Product).

Subject to the terms and conditions of the Purchase Agreement, we sold to Jazz (the “Asset Sale”) its program (the “898 Program”) for the development, manufacturing, commercialization, use and other exploitation of the Licensed Product.

Pursuant to the Purchase Agreement and related ancillary agreements, in consideration for the Transferred Assets, Jazz paid to us upfront consideration of $ 21.0 million, and has agreed to pay an additional $ 2.0 million upon the consent to the partial assignment a certain license agreement, as and to the extent such agreement relates to the conduct of the 898 Program.

Jazz also assumed certain liabilities of ours relating to the 898 Program arising after the Closing.

The Purchase Agreement contains customary representations, warranties and covenants of each of us and Jazz.

Effective as of the Closing, the Collaboration Agreement was terminated.

Loan Repayment

On May 6, 2026, we entered into a letter agreement providing for the repayment by us of all amounts owed under the K2HV Loan Agreement.

On May 6, 2026, upon payment by us of approximately $ 31.4 million, all of our indebtedness and obligations to the Collateral Trustee and the Lenders under the K2HV Loan Agreement and any other related loan and collateral security documents was deemed paid and discharged in full.

Balance as of March 31, 2026 443

Restructuring costs recognized during the period

Cash payments made during the period

Amortization of employee retention bonuses paid in the prior period ( 509 )

Non-cash charges recognized during the period

Balance as of June 30, 2026 $ 34

Lease Termination

On May 7, 2026, we entered into an Agreement for Termination of Lease and Voluntary Surrender of Premises (the “Lease Termination”) with ARE-770/784/790 Memorial Drive, LLC (the “Landlord”), pursuant to which we and the Landlord agreed to terminate that certain lease, dated June 1, 2021, as amended, by and between us and the Landlord (the “Lease”), effective October 31, 2026 or such sooner date as a party provides notices in accordance with the Lease Termination (the “Lease Termination Date”).

On May 7, 2026 (the “Modification Date”), we entered into an Agreement for Termination of Lease and Voluntary Surrender of Premises (the “Lease Termination”) with ARE-770/784/790 Memorial Drive, LLC (the “Landlord”), pursuant to which we and the Landlord agreed to terminate that certain lease, dated June 1, 2021, as amended, by and between us and the Landlord (the “Lease”), effective October 31, 2026 (the “Lease Termination Date”).

Either party may elect to accelerate the Lease Termination Date by providing 30 days’ prior written notice to the other party, provided that such notice is given no earlier than July 1, 2026 (the “Termination Option”).

Under the Lease, we leased approximately 25,778 square feet of space, consisting of the entire building located at 200 Talcott Avenue, Watertown, Massachusetts.

Pursuant to the Lease Termination, we will pay the Landlord an aggregate termination fee of $ 2.7 million, which shall represent full satisfaction of all remaining payments and other financial obligations due from us to the Landlord under the Lease including, without limitation, Base Rent (as defined in the Lease) for the months of May 2026 through October 2026.

We will have no further rent obligations to the Landlord pursuant to the Lease after the Lease Termination Date.

Pursuant to the Lease Termination, we paid the Landlord an aggregate termination fee of $ 2.7 million, which represented full satisfaction of all remaining payments and other financial obligations due from us to the Landlord under the Lease including, without limitation, Base Rent (as defined in the Lease) for the months of May 2026 through October 2026.

We have no further rent obligations to the Landlord pursuant to the Lease after the Lease Termination Date.

We have assessed the Lease Termination and have concluded that it represents a modification to the Lease within the scope of ASC Topic 842, Leases (“ASC 842”).

Upon the execution of the Lease Termination, we were reasonably certain that the Termination Option would be exercised, and accordingly we estimated that the lease would terminate on July 31, 2026 for purposes of measuring the modified lease liability.

On the Modification Date, we measured our modified lease liability to be $ 2.5 million.

We reduced our lease liability to the modified lease liability through an adjustment to our right-of-use asset as of the Modification Date.

We have recognized a reduction to our operating expenses during the three and six months ended June 30, 2026 in the amount of $ 1.1 million, representing the remaining reduction in our lease liability required after our right-of-use asset was reduced to zero.

The reduction to our operating expenses has been allocated between research and development and general and administrative operating expenses proportionately with how the operating lease costs have been allocated over the term of the Lease.

As a result of the Lease Termination, we have determined that the estimated useful lives for the majority of our property and equipment will no longer extend beyond July 31, 2026.

We have recognized additional depreciation expense during the three and six months ended June 30, 2026 as a result of the change in the estimated useful lives, and will continue to recognize higher-than-expected depreciation expense during each period until our property and equipment is fully depreciated or disposed of.

On July 1, 2026, the Landlord exercised the Termination Option to terminate the Lease, effective July 31, 2026.

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