Item 7. Management’s Discussion and Analysis
Item 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes appearing in Part II, Item 8 of this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in Part I, Item IA. ‘‘Risk Factors’’ of this Annual Report on Form 10-K, our actual results could differ materially from the results described in, or implied by, the forward-looking statements contained in the following discussion and analysis.
Overview
We are a late-stage clinical oncology company focused on keeping cancer patients alive and helping them thrive . We are developing and seeking to commercialize an entirely new category of anti-cancer medicines, Deep Cyclic Inhibitors, which we believe have the potential to be more effective and better tolerated targeted therapies.
Deep Cyclic Inhibition® ("DCI") is a novel mechanism that aims to deprive tumor cells of the sustained proliferative signaling required for rapid growth, while sparing healthy cells through a cadenced, normalized level of signaling. Our Deep Cyclic Inhibitors inhibit clinically-validated core signaling pathways, such as the MAPK pathway. Our novel approach is designed to improve durability and tolerability, and differentiates us from chronically targeted precision therapies, which are generally limited by toxicity, resistance and/or application to specific mutations only .
Our lead product candidate, atebimetinib (IMM-1-104), is an oral, once-daily Deep Cyclic Inhibitor of MEK, designed to improve durability and tolerability across many cancer indications, including MAPK pathway-driven tumors such as pancreatic cancer. We are currently in the process of initiating a Phase 3 clinical trial of atebimetinib, which we call the MAPKeeper 301 trial, to evaluate atebimetinib in combination with mGnP in first-line pancreatic cancer patients. We expect to dose the first patient in the MAPKeeper 301 trial in mid-2026.
MAPKeeper 301 is designed as a global Phase 3 registrational trial that will evaluate atebimetinib (320 mg QD) in comb ination with mGnP, compared to standard of care GnP alone, in first-line metastatic PDAC. The primary endpoint of MAPKeeper 301 is overall survival, and secondary endpoints include progression-free survival, overall response rate, disease control rate, and quality of life measurements. We plan to enroll a total of approximately 510 patients in MAPKeeper 301, divided equally across the two arms.
In January 2026, we announced positive interim response and safety data from our ongoing Phase 2a clinical trial arm evaluating atebimetinib in combination with mGnP in first-line pancreatic cancer patients, which is part of our ongoing Phase 1/2a clinical trial of atebimetinib in patients with advanced solid tumors. We also announced that we expect the following near-term milestones related to atebimetinib: presenting further updated circulating tumor DNA data on acquired alterations from cancer patients treated with atebimetinib at a major scientific meeting, in the second quarter of 2026; announcing further updated survival data from over 50 first-line pancreatic cancer patients treated with atebimetinib in combination with mGnP in our ongoing Phase 1/2a clinical trial, in the first half of 2026; and dosing the first patient in a planned clinical trial of atebimetinib in combination with Libtayo® in non-small cell lung cancer patients, in the second half of 2026.
Our development pipeline also includes our additional clinical-stage product candidate envometinib (IMM-6-415) and other early-stage research programs, including research focused on validated core cancer-signaling pathways outside of the MAPK pathway.
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For the period from inception through 2017, we devoted substantially all of our efforts to business planning, service revenue generation, developing tools to aid in drug discovery, and recruiting management and technical staff. Since 2018, we have focused significant effort on our own internal research and development programs, and since December 2022 have exclusively focused our efforts on such programs. We have financed our operations through service revenues (which have since ceased), the issuance of convertible debt and the sale of convertible preferred stock, common stock and warrants exercisable for common stock.
On December 22, 2021, we completed the acquisition of all outstanding shares of capital stock of BioArkive, Inc., a California corporation (“BioArkive”), for a market value of $8.75 million. BioArkive was a San Diego based contract research organization that previously provided preclinical research services and biosample storage to us and other biotechnology companies. BioArkive was fully integrated into our operations following the acquisition and now exclusively supports our internal preclinical research activities for our oncology pipeline. In connection with the acquisition, we assumed BioArkive’s lease agreement obligations.
We sold 5,164,159 shares of common stock under our 2022 ATM Program (as defined below), at a weighted average price per share of $3.03, for aggregate gross proceeds of $15.6 million ($15.0 million net of offering expenses) during the year ended December 31, 2025. We did not sell any shares of common stock under our 2022 ATM Program during the three months ended December 31, 2025. We also did not sell any shares of common stock under our 2025 ATM Program (as defined below) during the three months or year ended December 31, 2025.
On August 21, 2025, we entered into a Securities Purchase Agreement (the "August 2025 Purchase Agreement") with the purchasers party thereto, pursuant to which we agreed to sell securities to such purchasers in a private placement (the “August 2025 Private Placement”). The August 2025 Purchase Agreement provided for the sale and issuance by us to the purchasers of: (i) an aggregate of 5,251,349 shares of our common stock at a purchase price of $3.95 per share, (ii) for certain purchasers, in lieu of common stock, an aggregate of 1,077,764 pre-funded warrants (the “Pre-Funded Warrants”) to purchase up to the same number of shares of our common stock, and (iii) an aggregate of 2,848,096 warrants (the “Purchase Warrants”) to purchase up to the same number of shares of our common stock. The Pre-Funded Warrants were issued for a purchase price equating to $3.949 per Pre-Funded Warrant (which was the per share purchase price for the common stock issued in the August 2025 Private Placement, less the $0.001 per share unfunded exercise price for each Pre-Funded Warrant); following the October 2025 Cashless Exercise (as defined below), no Pre-Funded Warrants remained issued and outstanding. The Purchase Warrants were issued with an exercise price of $5.50 per share; as of December 31, 2025, no Purchase Warrants had been exercised. As of December 31, 2025, we had received aggregate net proceeds of $23.4 million from the August 2025 Private Placement, after deducting placement expenses of $1.6 million. The August 2025 Private Placement closed on August 26, 2025.
On September 24, 2025, we entered into a Securities Purchase Agreement (the "September 2025 Purchase Agreement") with Aventis Inc. ("Aventis"), a wholly owned subsidiary of Sanofi, a French société anonyme ("Sanofi"), pursuant to which we agreed to sell securities to Aventis in a private placement (the “September 2025 Private Placement”). The September 2025 Purchase Agreement provided for the sale and issuance by us to Aventis of an aggregate of 2,708,559 shares of our common stock at a purchase price of $9.23 per share. We received aggregate net proceeds of $23.4 million from the September 2025 Private Placement, after deducting placement agent discounts and commissions of $1.5 million and placement costs of $0.1 million. The September 2025 Private Placement closed on September 26, 2025.
On September 26, 2025, we completed an underwritten follow-on equity offering, pursuant to which we issued and sold 18,959,914 shares of our common stock at an offering price of $9.23 per share (the "September 2025 Offering"), with Leerink Partners LLC and Oppenheimer & Co. Inc. acting as underwriters. The aggregate net proceeds received by us from the September 2025 Offering were $164.1 million, after deducting underwriting discounts and commissions, as well as offering costs of $0.4 million.
Since our inception, we have had significant annual operating losses. Our net loss was approximately $56.0 million and $61.0 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, we had an accumulated deficit of approximately $280.3 million and approximately $217.0 million in cash, cash equivalents, and marketable securities.
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We have not had any internally developed products approved for sale. We do not expect to generate any product sales unless and until we successfully complete development of, obtain regulatory approval for, and successfully bring to market one or more of our internally developed product candidates. If we obtain regulatory approval for any of our internally developed product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. As a result, until such time, if ever, that we can generate substantial product revenue, we expect to finance our cash needs through equity offerings, debt financings or other capital sources including, without limitation, potential collaborations, licenses or similar arrangements.
Based on our current business plans, we believe that our existing cash, cash equivalents, and marketable securities as of December 31, 2025 will enable us to fund our development activities and other operations into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. To finance our operations beyond that point we will need to raise additional capital, which cannot be assured. We may be unable to raise additional funds or enter into such other arrangements when needed or on favorable terms, if at all. Any failure to raise capital as and when needed could have a negative impact on our financial condition and on our ability to pursue our business plans and strategies, including our research and development activities. If we are unable to raise capital, we will need to delay, reduce or terminate some or all planned activities to reduce costs.
As of March 6, 2026, the issuance date of the consolidated financial statements for the year ended December 31, 2025 in this Annual Report on Form 10-K, based on our recurring losses from operations incurred since inception, expectation of continuing operating losses for the foreseeable future and the need to raise additional capital to finance future operations, we believe that our existing cash, cash equivalents, and marketable securities will enable us to fund our development activities and other operations into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. To finance our operations beyond that point we will need to raise additional capital, which cannot be assured.
Components of Our Results of Operations
Operating Expenses
Our operating expenses consist of: (i) research and development expenses, and (ii) general and administrative expenses.
Research and Development
Research and development expenses account for a significant portion of our total operating expenses. Our research and development expenses consist primarily of direct and indirect costs incurred in connection with the development of our research platform, product candidates, discovery efforts and preclinical and clinical activities related to our program pipeline.
Our direct costs include:
• program specific expenses incurred under agreements with third-party CROs and other vendors that conduct our preclinical and clinical activities on our behalf, including clinical trial sites that conduct research and development activities on our behalf;
• laboratory expenses related to the execution of discovery programs, preclinical studies and clinical trials; and
• costs related to production of clinical and preclinical materials, including fees paid to contract manufacturers.
Our indirect costs include:
• personnel-related expenses, consisting of employee salaries, bonuses, benefits and stock-based compensation expense, and recruiting costs for personnel engaged in research and development activities;
• contractor and consulting fees related to the preparation and ongoing support of clinical trials; and
• facility and equipment related expenses, consisting of indirect and allocated expenses for rent, depreciation and amortization, maintenance of facilities, insurance, and other supplies.
We expense research and development costs in the periods in which they are incurred.
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Our direct research and development expenses consist of external costs and fees paid to consultants, contractors, CMOs and CROs in connection with our preclinical and clinical development and manufacturing activities. Such program costs also include the external costs of laboratory and consumable materials and costs of raw materials that are directly attributable to and incurred for any single program. We do not allocate employee costs, contractor/consultant fees, costs associated with our platform development and discovery efforts, payments made under third-party licensing agreements, costs of laboratory supplies and consumable materials that are not directly attributable to any single program, and facilities expenses, including rent, depreciation/amortization, and other indirect costs, to specific product development programs because these costs are deployed across multiple programs and our platform technology and, as such, are not separately classified.
Due to the inherently unpredictable nature and numerous risks and uncertainties associated with product development and the current stage of development of our product candidates and programs, we cannot reasonably estimate or know the nature, timing and estimated costs necessary to complete the remainder of the development of our product candidates or programs. We are also unable to predict if, when, or to what extent we will obtain approval and generate revenues from the commercialization and sale of any of our product candidates.
The duration, costs and timing of preclinical studies and clinical trials and development of our product candidates will depend on a variety of factors, such as, without limitation:
• successful completion of preclinical studies and initiation of clinical trials for future product candidates;
• successful enrollment and completion of clinical trials for our current product candidates;
• data from our clinical programs that support an acceptable risk-benefit profile of our product candidates in the intended patient populations;
• acceptance by the FDA or other applicable regulatory agencies of IND applications and amendments, clinical trial applications and/or other regulatory filings for our product candidates;
• expansion and maintenance of a workforce of experienced scientists and others to continue to develop our product candidates;
• successful application for and receipt of marketing approvals from applicable regulatory authorities;
• obtainment and maintenance of intellectual property protection and regulatory exclusivity for our product candidates;
• making of arrangements with contract manufacturing organizations for, or establishment of, commercial manufacturing capabilities;
• establishment of sales, marketing and distribution capabilities and successful launch of commercial sales of our product candidates, if and when approved, whether alone or in collaboration with others;
• acceptance of our product candidates, if and when approved, by patients, the medical community and third-party payors;
• effective competition with other therapies;
• obtainment and maintenance of coverage, adequate pricing and adequate reimbursement from third-party payors, including government payors;
• maintenance, enforcement, defense and protection of our rights in our intellectual property portfolio;
• avoidance of infringement, misappropriation or other violations with respect to others’ intellectual property or proprietary rights; and
• maintenance of a continued acceptable safety profile of our product candidates following receipt of marketing approvals, if any.
A change in the outcome of any of these variables with respect to the development of any of our product candidates could significantly change the costs and timing associated with the development of that product candidate.
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The process of conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and time-consuming. The actual probability of success for our product candidates may be affected by a variety of factors.
We may never succeed in achieving regulatory approval for any of our product candidates. Further, a number of factors, including those outside of our control, could adversely impact the timing and duration of our product candidates’ development, which could increase our research and development expenses. We may obtain unexpected results from our preclinical studies and clinical trials. We may elect to discontinue, delay or modify clinical trials of some product candidates or focus on others. A change in the outcome of any of these factors could mean a significant change in the costs and timing associated with the development of our current and future preclinical and clinical product candidates. For example, if the FDA, EMA or another regulatory authority were to require us to conduct clinical trials beyond those that we currently anticipate will be required for the completion of clinical development, or if we experience significant delays in execution of or enrollment in any of our preclinical studies or clinical trials, we could be required to expend significant additional financial resources and time on the advancement of preclinical and clinical development.
We expect that our research and development expenses will substantially increase for the foreseeable future as we continue to implement our business strategy, which includes: advancing our product candidates through clinical development (including atebimetinib in our MAPKeeper 301 Phase 3 clinical trial), expanding our research and development efforts, including hiring additional personnel to support our research and development efforts, and seeking regulatory approvals for our product candidates that successfully complete clinical trials. In addition, product candidates in later stages of clinical development generally incur higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. As a result, we expect our research and development expenses to increase as our product candidates advance into later stages of clinical development. As of the date of this Annual Report on Form 10-K, we cannot reasonably determine or accurately project total program-specific expenses through commercialization, if such was to occur. There are numerous factors associated with the successful commercialization of any of our product candidates, including future trial design and various regulatory requirements, many of which cannot be determined with accuracy at this time based on our stage of development.
General and Administrative
Our general and administrative expenses consist primarily of personnel-related expenses, including employee salaries, bonuses, benefits, stock-based compensation, and recruiting costs for personnel in executive, finance, and other administrative functions. Other significant general and administrative expenses include legal fees relating to intellectual property and corporate matters, professional fees for accounting, tax and consulting services, insurance costs, travel expenses and facility related expenses not otherwise included in research and development expenses.
We expect our general and administrative expenses will increase for the foreseeable future if and as we continue to increase our general and administrative headcount to support our continued research and development activities and, if any product candidates receive marketing approval, commercialization activities, as well as to support our operations generally. We also expect to continue to incur increased expenses associated with operating as a public company, including costs related to accounting, audit, legal, regulatory, and tax-related services associated with maintaining compliance with exchange listing and rules and regulations of the Securities and Exchange Commission (“SEC”), Sarbanes-Oxley Act, director and officer insurance costs, and investor and public relations costs.
Amortization of intangible asset
Amortization of intangible asset relates to the technology acquired in the BioArkive acquisition.
Other Income (Expense)
Interest income
Interest income consists of interest earned on our cash, cash equivalents, and marketable securities balances. The primary objective of our investment policy is capital preservation.
Other income, net
Other income consists of the accretion of discounts related to our marketable securities.
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Results of Operations
Comparison of the Years Ended December 31, 2025 and 2024
The following table summarizes our results of operations for the periods indicated:
Year Ended December 31, Change
2025 2024 $ %
(in thousands, except percentages)
Operating expenses
Research and development $ 42,048 $ 47,964 $ (5,916) (12.3) %
General and administrative 17,298 16,078 1,220 7.6 %
Amortization of intangible asset 29 29 — — %
Total operating expenses 59,375 64,071 (4,696) (7.3) %
Loss from operations (59,375) (64,071) 4,696 (7.3) %
Other income (expense)
Interest income 3,039 2,593 446 17.2 %
Other income, net 312 441 (129) (29.3) %
Net loss $ (56,024) $ (61,037) $ 5,013 (8.2) %
Research and Development
The following table summarizes the components of our research and development expenses for the periods indicated:
Year Ended December 31, Change
2025 2024 $ %
(in thousands, except percentages)
Direct research and development expenses by program:
Atebimetinib (IMM-1-104) $ 17,639 $ 18,099 $ (460) (2.5) %
Envometinib (IMM-6-415) 2,204 6,521 (4,317) (66.2) %
Other programs 5,857 6,031 (174) (2.9) %
Indirect research and development expenses:
Employee-related costs 11,988 12,912 (924) (7.2) %
Stock-based compensation expense 2,801 2,755 46 1.7 %
Facilities and other expenses 1,316 1,401 (85) (6.1) %
Depreciation/amortization 243 245 (2) (0.8) %
Total research and development $ 42,048 $ 47,964 $ (5,916) (12.3) %
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Research and development expenses decreased by approximately $5.9 million, or 12.3%, to approximately $42.0 million for the year ended December 31, 2025 as compared to approximately $48.0 million for the year ended December 31, 2024. The decrease of approximately $5.9 million was primarily due to a decrease of approximately $5.0 million related to direct research and development expenses, consisting of: an approximately $0.5 million decrease in expenses related to the atebimetinib program, primarily driven by a decrease in certain chemistry, tablet and safety study costs, offset by increased costs related to Phase 3 clinical trial initiation; an approximately $4.3 million decrease in expenses related to the paused envometinib program; and an approximately $0.2 million decrease in expenses for earlier stage programs, as compared to the same prior year period. The overall decrease in research and development expenses was additionally driven by a decrease in indirect research and development costs of approximately $1.0 million, primarily driven by decreased employee-related costs of approximately $0.9 million, and decreased facilities and other allocated expenses of approximately $0.1 million.
General and Administrative
The following table summarizes the components of our general and administrative expenses for the periods indicated:
Year Ended December 31, Change
2025 2024 $ %
(in thousands, except percentages)
Employee-related costs $ 8,925 $ 8,253 $ 672 8.1 %
Stock-based compensation expense 3,510 3,746 (236) (6.3) %
Professional fees 3,125 2,584 541 20.9 %
Facilities and other allocated expenses 256 297 (41) (13.8) %
Other 1,482 1,198 284 23.7 %
Total general and administrative $ 17,298 $ 16,078 $ 1,220 7.6 %
General and administrative expenses increased by approximately $1.2 million, or 7.6%, to approximately $17.3 million for the year ended December 31, 2025 compared to approximately $16.1 million for the year ended December 31, 2024. The increase of approximately $1.2 million was primarily due to: increased employee-related costs of approximately $0.7 million; increased professional fees incurred for accounting, auditing, legal, public relations and tax services of approximately $0.5 million; and increased other expenses (primarily consisting of offering costs associated with various financing efforts) of approximately $0.3 million, offset by a decrease in stock-based compensation of approximately $0.2 million.
Amortization of Intangible Asset
Amortization of intangible asset was $29 thousand for the years ended December 31, 2025 and 2024. This amortization is related to the technology acquired from the BioArkive acquisition completed in December 2021.
Other Income, net
Interest income from the interest earned on our cash, cash equivalents and marketable securities balances increased by approximately $0.4 million, driven by a higher total cash balance resulting from various financing events, in the year ended December 31, 2025 as compared to the year ended December 31, 2024.
Other income, net was approximately $0.3 million in the year ended December 31, 2025, compared to $0.4 million in the year ended December 31, 2024. These amounts were primarily a result of the accretion of premiums related to our marketable securities.
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Liquidity and Capital Resources
Sources of Liquidity
We finance our operations through the issuance of convertible notes payable, convertible preferred stock, common stock, warrants exercisable for common stock and the exercise of stock options. As of December 31, 2025, we had an accumulated deficit of $280.3 million and $217.0 million in cash, cash equivalents and marketable securities. Cash, cash equivalents and marketable securities are comprised of deposits at major financial banking institutions and highly liquid investments with an original maturity of three months or less at the date of purchase. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, reflected in the change in our outstanding accounts payable and accrued expenses.
Since our inception, we have incurred significant operating losses. Our net loss was approximately $56.0 million and $61.0 million for the years ended December 31, 2025 and 2024, respectively. We have not yet commercialized any of our product candidates, and we do not expect to generate revenue from sales of any product candidates for the next several years, if at all. To date, our operations have been financed primarily by service revenues (which have since ceased) and proceeds from sales of our debt and equity securities.
On August 10, 2022, we filed a Registration Statement on Form S-3 (File No. 333-266738) (the “2022 Shelf Registration Statement”) with the SEC in relation to the registration of our common stock, preferred stock, debt securities, warrants and/or units or any combination thereof in the aggregate amount of up to $200 million for a period of up to three years from the date of its effectiveness on August 19, 2022.
Also on August 10, 2022, we entered into an Equity Distribution Agreement (the "2022 Sales Agreement") with Piper Sandler & Co (the "Sales Agent"), to sell shares of our common stock with aggregate gross proceeds of up to $50 million, from time to time, through an "at the market" equity offering program (the "2022 ATM Program") under the 2022 Shelf Registration Statement. We sold 5,164,159 shares of common stock under the 2022 ATM Program, at an weighted average price per share of $3.03, for aggregate gross proceeds of $15.6 million ($15.0 million net of offering expenses) during the year ended December 31, 2025. We sold 1,318,752 shares of common stock under the 2022 ATM program, at a weighted average price per share of $3.38, for aggregate gross proceeds of $4.5 million ($4.2 million net of offering expenses) during the year ended December 31, 2024. We did not sell any shares of common stock under the 2022 ATM Program during the three months ended December 31, 2025 or December 31, 2024, respectively. In August 2025, the 2022 Shelf Registration Statement and the 2022 ATM Program expired, and the 2022 Sales Agreement was terminated.
On August 13, 2025, we filed a Registration Statement on Form S-3 (File No. 333-289589) (the “2025 Shelf Registration Statement”) with the SEC in relation to the registration of our common stock, preferred stock, debt securities, warrants and/or units or any combination thereof in the aggregate amount of up to $300 million for a period of up to three years from the date of its effectiveness on August 20, 2025.
Also on August 13, 2025, we entered into an Equity Distribution Agreement (the "2025 Sales Agreement") with the Sales Agent, to sell shares of our common stock with aggregate gross proceeds of up to $100 million, from time to time, through an "at the market" equity offering program (the "2025 ATM Program") under the 2025 Shelf Registration Statement. In connection with the September 2025 Offering, we: (i) reduced the maximum aggregate offering price for sales of shares of common stock pursuant to at-the-market transactions under the 2025 ATM Program by $1,250,007 (the "Reduced Amount"), resulting in a new maximum aggregate offering price of up to $98,749,993 under the 2025 ATM Program, and (ii) suspended the 2025 ATM Program and terminated the continuous offering under the 2025 ATM Program, in each case, as to the Reduced Amount. We did not sell any shares of common stock under the 2025 ATM Program during the three and twelve months ended December 31, 2025 or December 31, 2024, respectively.
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On August 21, 2025, we entered into the August 2025 Purchase Agreement with the purchasers party thereto, pursuant to which we agreed to sell securities to such purchasers in the August 2025 Private Placement. The August 2025 Purchase Agreement provided for the sale and issuance by us to the purchasers of: (i) an aggregate of 5,251,349 shares of our common stock at a purchase price of $3.95 per share, (ii) for certain purchasers, in lieu of common stock, an aggregate of 1,077,764 Pre-Funded Warrants to purchase up to the same number of shares of our common stock, and (iii) an aggregate of 2,848,096 Purchase Warrants to purchase up to the same number of shares of our common stock. The Pre-Funded Warrants were issued for a purchase price equating to $3.949 per Pre-Funded Warrant (which was the per share purchase price for the common stock issued in the August 2025 Private Placement, less the $0.001 per share unfunded exercise price for each Pre-Funded Warrant). On October 6, 2025, certain purchasers from the August 2025 Private Placement exercised an aggregate of 1,077,764 Pre-Funded Warrants previously issued to them pursuant to the August 2025 Purchase Agreement. Each such exercise was made pursuant to the cashless exercise provision of the applicable Pre-Funded Warrant, such that an aggregate of 166 shares of common stock were withheld in lieu of cash payment of the $0.001 exercise price for each Pre-Funded Warrant share, and the exercising purchasers were issued an aggregate of 1,077,598 shares of common stock (the "October 2025 Cashless Exercise"). Following the October 2025 Cashless Exercise, no Pre-Funded Warrants remained issued and outstanding. The Purchase Warrants were issued with an exercise price of $5.50 per share; as of December 31, 2025, no Purchase Warrants had been exercised. As of December 31, 2025, we had received aggregate net proceeds of $23.4 million from the August 2025 Private Placement, after deducting placement expenses of $1.6 million. The August 2025 Private Placement closed on August 26, 2025.
Also on August 21, 2025, in connection with the August 2025 Purchase Agreement, we entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with the purchasers in the August 2025 Private Placement. Pursuant to the Registration Rights Agreement, we agreed to prepare and file a registration statement with the SEC for purposes of registering the resale of the common stock and the shares of common stock issuable upon exercise of the Pre-Funded Warrants and Purchase Warrants (collectively, the “Warrant Shares”) purchased by the purchasers in the August 2025 Private Placement, and any shares of common stock issued as a dividend or other distribution with respect to, in exchange for or in replacement of such common stock or Warrant Shares. On September 3, 2025, we filed a Registration Statement on Form S-3 (File No. 333-289997) (the “2025 Resale Registration Statement”) with the SEC in relation to the registration for re-sale of the common stock and Warrant Shares from the August 2025 Private Placement. The SEC declared the 2025 Resale Registration Statement effective on September 8, 2025.
The foregoing and other related summaries contained herein do not purport to be complete and are qualified in their entirety by reference to the August 2025 Purchase Agreement, the Registration Rights Agreement, the Pre-Funded Warrants and the Purchase Warrants, which are filed as Exhibits 10.18, 10.19, 4.4 and 4.5, respectively, to this Annual Report on Form 10-K.
On September 24, 2025, we entered into the September 2025 Purchase Agreement with Aventis, a wholly owned subsidiary of Sanofi, pursuant to which we agreed to sell securities to Aventis in the September 2025 Private Placement. The September 2 025 Purchase Agreement provided for the sale and issuance by us to Aventis of an aggregate of 2,708,559 shares of our common stock at a purchase price of $9.23 per share. We received aggregate net proceeds $23.4 million from the September 2025 Private Placement, after deducting placement agent discounts and commissions of $1.5 million and placement costs of $0.1 million. The September 2025 Private Placement closed on September 26, 2025.
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Pursuant to the September 2025 Purchase Agreement, w e also agreed to (i) notify Aventis within three business days of us engaging in discussions with any third party regarding, or the board of directors authorizing us to pursue or initiate a process to pursue, any transaction that would be reasonably expected to result in a change of control of the Company or an affiliate of the Company (a “Change of Control”) or any other license, sale, assignment, transfer, grant or other disposition of the Company’s or an affiliate of the Company’s rights to research, develop, manufacture, commercialize, or otherwise exploit atebimetinib (a “Covered Transaction” and, collectively, a “Strategic Transaction Process”), (ii) provide Aventis the opportunity to participate in such Strategic Transaction Process subject to customary confidentiality and other undertakings on substantially the same procedural terms and timeframe as other participants, and (iii) for a period of 120 days following the date of the September 2025 Purchase Agreement, not enter into any Covered Transaction or commence, continue, or otherwise engage in any discussions, or negotiate with any third party, to enter into any Covered Transaction (provided that this provision shall not limit the entry by us into, or any engagement in discussion or negotiations with any third party regarding, a Change of Control transaction). These provisions contain customary confidentiality restrictions and limitations on disclosure obligations, and will terminate upon the earlier of: (a) such time as Aventis and its affiliates no longer hold at least 50% of the securities purchased from the Company pursuant to the September 2025 Purchase Agreement, (b) 90 days after the public release of the topline results of the overall survival of the Phase 3 clinical trial of atebimetinib in pancreatic cancer, (c) the liquidation, dissolution or winding-up of the affairs of the Company, or the consummation of any Change of Control or any other deemed liquidation event of the Company and (d) such time as all development activities with respect to atebimetinib have been terminated.
In addition, pursuant to the September 2025 Purchase Agreement, Aventis agreed (i) until the date that is six months after the closing date of the September 2025 Private Placement, to be subject to customary lock-up restrictions with respect to sales of shares of our common stock (or similar transactions with the same economic effect), subject to certain customary exceptions, (ii) until the first anniversary of the closing date of the September 2025 Private Placement, to be subject to stand-still restrictions with respect to acquisitions of shares of the our common stock and similar activities, subject to certain customary exceptions and fall-away provisions, and (iii) until the first anniversary of the closing date of the September 2025 Private Placement or such earlier time as the stand-still restrictions shall have fallen away, vote with respect to all voting securities of the Company as to which it is entitled to vote in accordance with the recommendation of a majority of our board of directors.
The foregoing and other related summaries contained herein do not purport to be complete and are qualified in their entirety by reference to the September 2025 Purchase Agreement, which is filed as Exhibit 10.20 to this Annual Report on Form 10-K.
On September 26, 2025, we completed the September 2025 Offering, pursuant to which we issued and sold 18,959,914 shares of our Class A common stock at an offering price of $9.23 per share, with Leerink Partners LLC and Oppenheimer & Co. Inc. acting as underwriters. The aggregate net proceeds received by us from the September 2025 Offering $164.1 million, after deducting underwriting discounts and commissions, as well as offering costs of $0.4 million.
As of December 31, 2025, we had contractual obligations related to various leases of $0.8 million for 2026, $0.8 million for 2027, $0.8 million for 2028, $0.8 million for 2029, $0.9 million for 2030 and $1.2 million for the periods thereafter.
Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our accounts payable and accrued expenses. We expect to continue to incur net losses for the foreseeable future, and we expect our research and development expenses, general and administrative expenses, and capital expenditures will continue to increase. In particular, we expect our expenses to increase as we continue our development of, and seek regulatory approvals for, our internally developed product candidates as well as add operational, financial and management informational systems and personnel to support our product development. In addition, if and when we seek and obtain regulatory approval to commercialize any product candidate, we will also incur increased expenses in connection with commercialization and marketing of any such product candidate. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials and our expenditures on other research and development activities.
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Based on our current business plans, we believe that our existing cash, cash equivalents, and marketable securities as of December 31, 2025 will enable us to fund our development activities and other operations into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. To finance our operations beyond that point we will need to raise additional capital, which cannot be assured. We may be unable to raise additional funds or enter into such other arrangements when needed or on favorable terms, if at all. Any failure to raise capital as and when needed could have a negative impact on our financial condition and on our ability to pursue our business plans and strategies, including our research and development activities. If we are unable to raise capital, we will need to delay, reduce or terminate some or all planned activities to reduce costs.
We have no off-balance sheet arrangements that have a material current effect or that are reasonably likely to have a material future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources.
Going Concern Assessment
Management considered whether or not there are conditions or events, in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern, and concluded that there are none as it estimates that the entity's cash, cash equivalents and marketable securities will be sufficient to fund its operating expenses and capital expenditure requirements for at least one year from the date of issuance of the financial statements appearing within this Annual Report on Form 10-K.
Cash Flows
The following table summarizes our sources and uses of cash for the periods indicated:
Year Ended December 31,
2025 2024
(in thousands)
Net cash (used in) provided by:
Operating activities $ (45,345) $ (55,000)
Investing activities (88,738) 26,435
Financing activities 226,583 5,304
Net increase (decrease) in cash and cash equivalents $ 92,500 $ (23,261)
Net Cash Used in Operating Activities
During the year ended December 31, 2025, operating activities used approximately $45.3 million of cash, primarily resulting from our net loss of approximately $56.0 million and net amortization of premium (accretion of discount) on marketable securities of $0.2 million, partially offset by stock-based compensation expense of approximately $6.3 million, changes in our operating assets and liabilities of $3.8 million, and $0.7 million for the reduction in carrying amount of right-of-use assets and depreciation and amortization.
During the year ended December 31, 2024, operating activities used approximately $55.0 million of cash, primarily resulting from our net loss of approximately $61.0 million, changes in our operating assets and liabilities of $0.9 million, and net amortization of premium (accretion of discount) on marketable securities of $0.3 million, partially offset by stock-based compensation expense of approximately $6.5 million and $0.7 million for the reduction in carrying amount of right-of-use assets and depreciation and amortization.
Net Cash Used in Investing Activities
During the year ended December 31, 2025, cash used from investing activities was approximately $88.7 million, primarily related to purchases of marketable securities of $88.6 million and $0.1 million for purchases of property and equipment.
During the year end December 31, 2024, cash provided from investing activities was approximately $26.4 million, primarily related to maturities of marketable securities of $31.9 million, offset by purchases of marketable securities of $5.4 million and $0.1 million for purchases of property and equipment.
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Net Cash Provided by Financing Activities
During the year ended December 31, 2025, net cash provided by financing activities was approximately $226.6 million, primarily driven by proceeds of approximately: $15.0 million from the sale of common stock under our 2022 ATM program, net of commissions; $0.4 million from the sale of common stock pursuant to our employee stock purchase plan; $0.4 million from the exercise of stock options; $25.0 million from the sale of common stock, Pre-Funded Warrants and Purchase Warrants in the August 2025 Private Placement; $25.0 million from the sale of common stock in the September 2025 Private Placement; and $164.5 million from the sale of common stock in the September 2025 Offering, net of underwriting commissions. The above were partially offset by aggregate payments of offering and placement expenses, as applicable, of $3.7 million.
During the year ended December 31, 2024, net cash provided by financing activities was approximately $5.3 million, primarily driven by proceeds of approximately $4.2 million from the sale of common stock under our 2022 ATM program, net of offering expenses, in addition to $0.7 million from the exercise of stock options and approximately $0.4 million from our employee stock purchase plan.
Future Funding Requirements
We expect that our expenses will increase substantially in connection with our ongoing activities, particularly as we advance the preclinical activities and clinical trials for our product candidates in development. The timing and amount of our operating and capital expenditures will depend largely on:
• the costs and results of our ongoing clinical trial for atebimetinib, our planned registrational trial of atebimetinib in combination with mGnP in first-line pancreatic cancer, and potential future clinical trials for atebimetinib and our other product candidates;
• the scope, progress, results and costs of discovery research, preclinical development, laboratory testing and clinical trials for our other product candidates;
• the costs, timing and outcome of regulatory review of our product candidates;
• our ability to enter into contract manufacturing arrangements for supply of active pharmaceutical ingredient ("API"), and manufacture of our product candidates and the terms of such arrangements;
• the payment or receipt of milestones and receipt of other collaboration-based revenues, if any;
• the costs and timing of future commercialization activities, if any, including product manufacturing, sales, marketing and distribution, for any of our product candidates for which we may receive marketing approval;
• the amount and timing of revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval;
• the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights and defending any intellectual property related claims;
• the extent to which we acquire or in-license other products, product candidates, technologies or data referencing rights;
• our ability to establish and maintain strategic collaborations, licensing or other arrangements and the financial terms of such arrangements;
• our ability to access the private and public capital markets or to obtain financing at commercially reasonable rate;
• the ability to receive additional non-dilutive funding, including grants from organizations and foundations;
• the costs of operating as a public company; and
• the impacts of ongoing or future pandemics, or other widespread adverse health events.
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Based on our currently forecasted operating plan, we believe that our existing cash, cash equivalents, and marketable securities as of December 31, 2025 will enable us to fund our operating expenses and capital expenditure requirements into 2029. Therefore, based on our recurring losses from operations incurred since inception, expectation of continuing operating losses for the foreseeable future and the need to raise additional capital to finance future operations, as of March 6, 2026, the issuance date of the consolidated financial statements for the year ended December 31, 2025 included elsewhere in this Annual Report on Form 10-K, management considered whether or not there are conditions or events, in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern, and concluded that there are none as it estimates that its cash, cash equivalents and marketable securities will be sufficient to fund its operating expenses and capital expenditure requirements for at least 12 months from the issuance date of these consolidated financial statements.
Critical Accounting Policies and Use of Estimates
Our consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). The preparation of our consolidated financial statements and related disclosures requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenue, costs and expenses and the disclosure of contingent assets and liabilities in our financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
While our significant accounting policies are described in more detail in Note 2 to our consolidated financial statements appearing in this Annual Report on Form 10-K, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our financial statements.
Research and Development Costs
We incur substantial expenses associated with manufacturing and clinical trials. Accounting for clinical trials relating to activities performed by CROs and other external vendors requires management to exercise significant estimates in regard to the timing and accounting for these expenses. We estimate costs of research and development activities conducted by service providers, which include the conduct of sponsored research, preclinical studies and contract manufacturing activities. The diverse nature of services being provided under CRO and other arrangements, the different compensation arrangements that exist for each type of service and the lack of timely information related to certain clinical activities complicates the estimation of accruals for services rendered by CROs and other vendors in connection with clinical trials. Because payments of research and development activities do not always line up with the provision of such services, the balance sheet may reflect either an accrued or prepaid position. In estimating the duration of a clinical trial, we evaluate the start-up, treatment and wrap up periods, compensation arrangements and services rendered attributable to each clinical trial and fluctuations are regularly tested against payment plans and trial completion assumptions.
We estimate these costs based on factors such as estimates of the work completed and budget provided and in accordance with agreements established with our collaboration partners and third-party service providers. We make significant judgments and estimates in determining the accrued liabilities and prepaid expense balances in each reporting period. As actual costs become known, we adjust our accrued liabilities or prepaid expenses. We have not experienced any material differences between accrued costs and actual costs incurred since our inception.
Our expenses related to clinical trials are based on estimates of patient enrollment and related expenses at clinical investigator sites as well as estimates for the services received and efforts expended pursuant to contracts with multiple research institutions and CROs that are used to conduct and manage clinical trials on our behalf. We accrue expenses related to clinical trials based on contracted amounts applied to the level of patient enrollment and activity. If timelines or contracts are modified based upon changes in the clinical trial protocol or scope of work to be performed, we modify our estimates of accrued expenses accordingly on a prospective basis.
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Stock-Based Compensation
We measure stock-based awards granted to employees, non-employees and directors based on their fair value on the date of the grant using the Black-Scholes option-pricing model for options or the difference between the purchase price per share of the award, if any, and the fair value of our common stock on the date of grant for restricted stock awards. Compensation expense for those awards is recognized over the requisite service period, which is generally the vesting period of the award for employees and directors and the period during which services are performed for non-employees. We use the straight-line method to record the expense of awards with service-based vesting conditions.
The Black-Scholes option-pricing model uses as inputs: the fair value of our common stock, the assumptions we make for the volatility of our common stock, the expected term of our stock options, the risk-free interest rate for a period that approximates the expected term of our stock options, and our expected dividend yield.
Off-balance Sheet Arrangements
During the periods presented, we did not have, nor do we currently have, any off-balance sheet arrangements as defined in the rules and regulations of the SEC.
Recently Issued Accounting Pronouncements
A description of recently issued accounting pronouncements that may potentially impact our financial position, results of operations or cash flows is disclosed in Note 2 to our consolidated financial statements appearing in this Annual Report on Form 10-K.
Emerging Growth Company Status
As an emerging growth company ("EGC") under the Jumpstart Our Business Startups Act of 2012 ("JOBS Act"), we may delay the adoption of certain accounting standards until such time as those standards apply to private companies. Other exemptions and reduced reporting requirements under the JOBS Act for EGCs include presentation of only two years of audited consolidated financial statements, an exemption from the requirement to provide an auditor’s report on internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act, an exemption from any requirement that may be adopted by the Public Company Accounting Oversight Board, and less extensive disclosure about our executive compensation arrangements.
In addition, the JOBS Act provides that an EGC can take advantage of an extended transition period for complying with new or revised accounting standards. This provision allows an EGC to delay the adoption of some accounting standards until those standards would otherwise apply to private companies. We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we: (i) are no longer an emerging growth company, or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our consolidated financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
We may qualify as an EGC until December 31, 2026, which is the end of the fiscal year following the fifth anniversary of our IPO, although if the market value of our common stock that is held by non-affiliates exceeds $700 million as of June 30 of any year before that time, or if we have annual gross revenues of $1.235 billion or more in any fiscal year, we will cease to be an EGC as of December 31 of the applicable year. We also will cease to be an EGC if we issue more than $1.0 billion of non-convertible debt over a three-year period.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
As a smaller reporting company, as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, we are not required to provide this information.
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.