What changed in this filing

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Item 1. Financial Statements

2025-11-14 compared with 2025-08-13 · 108 added, 95 removed, 523 unchanged (28% of the section changed)

3 unchanged sentences

(In thousands, except share data and par value)

JUNE 30, DECEMBER 31,

SEPTEMBER 30, DECEMBER 31,

Current assets:

21 unchanged sentences

Preferred stock, $ 0.0001 par value;

15,000,000 shares authorized as of June 30, 2025 and December 31, 2024;

no shares issued or outstanding as of June 30, 2025 and December 31, 2024.

15,000,000 shares authorized as of September 30, 2025 and December 31, 2024;

no shares issued or outstanding as of September 30, 2025 and December 31, 2024.

Common stock, $ 0.0001 par value;

120,000,000 shares authorized as of June 30, 2025 and December 31, 2024;

14,475,904 shares issued and outstanding as of June 30, 2025 and December 31, 2024.

120,000,000 shares authorized as of September 30, 2025 and December 31, 2024;

14,498,093 and 14,475,904 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively.

Additional paid-in-capital 250,182 239,715

7 unchanged sentences

THREE MONTHS ENDED

JUNE 30, SIX MONTHS ENDED

SEPTEMBER 30, NINE MONTHS ENDED

SEPTEMBER 30,

2025 2024 2025 2024

39 unchanged sentences

14,476 $ 1 $ 246,655 $ ( 178,097 ) $ 68,559

Stock-based compensation expense — — 3,175 — 3,175

Issuance of shares upon exercise of stock options 22 — 352 — 352

Net loss — — — ( 35,256 ) ( 35,256 )

Balance as of September 30, 2025

14,498 $ 1 $ 250,182 $ ( 213,353 ) $ 36,830

(Shares) Common Stock

16 unchanged sentences

14,476 $ 1 $ 233,768 $ ( 14,403 ) $ 219,366

Stock-based compensation expense — — 2,965 — 2,965

Net loss — — — ( 43,864 ) ( 43,864 )

Balance as of September 30, 2024

14,476 $ 1 $ 236,733 $ ( 58,267 ) $ 178,467

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

2 unchanged sentences

(In thousands)

SIX MONTHS ENDED

NINE MONTHS ENDED

SEPTEMBER 30,

Cash flows from operating activities

5 unchanged sentences

Non-cash lease expense 1,334 1,427

Loss on disposal of fixed assets 3 12

Non-cash gain on transaction with Acquirer

3 unchanged sentences

Other receivables

( 689 ) ( 345 )

Receivables from related parties 23 ( 672 )

7 unchanged sentences

Purchase of fixed assets ( 31 ) ( 2,581 )

Proceeds from the sale of property and equipment 3 —

Net cash used in investing activities ( 28 ) ( 2,581 )

60 unchanged sentences

In accordance with this guidance, the disposal of the 101 Business has been accounted for as a dividend-in-kind, with a gain recognized for the difference between the fair value and carrying value of the disposed assets.

The Company recorded a gain on the transaction of $ 2.0 billion during the three and six months ended June 30, 2024, which consists of the following components (in thousands):

THREE AND SIX MONTHS ENDED JUNE 30, 2024

The Company recorded a gain on the transaction of $ 2.0 billion during the nine months ended September 30, 2024, which consists of the following components (in thousands):

NINE MONTHS ENDED SEPTEMBER 30, 2024

Merger consideration for common stock, warrants, and stock options $ 1,727,687

5 unchanged sentences

representing the amount of retained earnings available at the closing of the Merger, with the remaining amount of $ 563.8 million recorded through additional paid-in capital.

As of June 30, 2025, the Company had an accumulated deficit of $ 178.1 million and cash and cash equivalents of $ 186.6 million.

From its inception and through June 30, 2025, the Company has devoted substantially all of its efforts to therapeutic drug discovery and development, conducting preclinical studies and clinical trials, enabling manufacturing activities in support of its therapeutic candidates, pre-commercialization activities, organizing and staffing the Company, establishing its intellectual property portfolio and raising capital to support and expand these activities.

As of September 30, 2025, the Company had an accumulated deficit of $ 213.4 million and cash and cash equivalents of $ 153.1 million.

From its inception and through September 30, 2025, the Company has devoted substantially all of its efforts to therapeutic drug discovery and development, conducting preclinical studies and clinical trials, enabling manufacturing activities in support of its therapeutic candidates, pre-commercialization activities, organizing and staffing the Company, establishing its intellectual property portfolio and raising capital to support and expand these activities.

The Company believes that its existing cash and cash equivalents will be sufficient to fund the Company’s operations for at least 12 months from the date these unaudited condensed consolidated financial statements are issued.

33 unchanged sentences

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

As of June 30, 2025 and December 31, 2024, the Company held $ 183.4 million and $ 149.0 million, respectively, of money market mutual funds or equivalents, which are classified as Level 1 in the fair value hierarchy.

The Company’s long-term outstanding debt as of June 30, 2025, which approximates fair value, is classified as Level 2 in the fair value hierarchy.

As of September 30, 2025 and December 31, 2024, the Company held $ 151.6 million and $ 149.0 million, respectively, of money market mutual funds or equivalents, which are classified as Level 1 in the fair value hierarchy.

The Company’s long-term outstanding debt is not measured at fair value on a reoccurring basis.

As of September 30, 2025, the fair value of the Company’s long-term outstanding debt approximates fair value using Level 2 inputs.

Accrued Research and Development and Clinical Trial Costs

15 unchanged sentences

The weighted average number of common stock used in the basic and diluted net income (loss) per common stock calculations includes the weighted-average pre-funded warrants outstanding during the period as they are exercisable at any time for nominal cash consideration.

During the three and six months ended June 30, 2024, outstanding shares during the period consist of shares of the Former Parent.

During the nine months ended September 30, 2024, outstanding shares during the period consist of shares of the Former Parent.

For purposes of computing net loss per share only, for all periods presented in its condensed consolidated statements of operations, the Company adjusted all outstanding shares of the Former Parent, including potentially dilutive securities, by the four-to-one distribution ratio used in the Distribution.

In periods in which the Company has a net loss, basic loss per share and diluted loss per share are identical since the effect of potentially dilutive common shares is anti-dilutive and therefore excluded.

Accordingly, for the three and six months ended June 30, 2025, there is no difference in the number of shares used to calculate basic and diluted shares outstanding.

Accordingly, for the three and nine months ended September 30, 2025 and the three months ended September 30, 2024, there is no difference in the number of shares used to calculate basic and diluted shares outstanding.

Potentially dilutive securities not included in the calculation of diluted loss per share are as follows (in thousands):

AS OF JUNE 30,

AS OF SEPTEMBER 30,

Outstanding stock options 3,590 3,641

Warrants to purchase common stock 141 —

Total 3,731 3,641

In periods in which the Company has a net income, the Company applies the treasury stock method to determine the dilutive effect of potentially dilutive securities.

Potentially dilutive securities included in the diluted earnings per share are as follows (in thousands):

THREE MONTHS ENDED

JUNE 30, 2024 SIX MONTHS ENDED

JUNE 30, 2024

NINE MONTHS ENDED

SEPTEMBER 30, 2024

Outstanding stock options 242

Warrants to purchase common stock 1

Total 188 366

Segment Information

6 unchanged sentences

interest income, and segment asset additions are consistent with consolidated amounts reported within the condensed consolidated statement of cash flows given the Company's operations are aggregated within a single reportable segment.

The Company has incurred operating losses since its inception and expects to continue to incur significant expenses and operating losses for the foreseeable future as it advances its therapeutic candidates through all stages of development and clinical trials and, ultimately, seeks regulatory approval.

The CODM uses net loss and the components of operating expense to assess the Company’s operating results and performance and make operating decisions regarding the allocation of resources to best support the long-term growth of the Company’s overall business.

The table below summarizes the significant segment expenses which are regularly reported to and reviewed by the CODM for the purposes of making decisions regarding the allocation of resources and are reconciled to condensed consolidated net income (loss) for the three and six months ended June 30, 2025 and June 30, 2024 (in thousands):

The CODM uses net income (loss) and the components of operating expense to assess the Company’s operating results and performance and make operating decisions regarding the allocation of resources to best support the long-term growth of the Company’s overall business.

The table below summarizes the significant segment expenses which are regularly reported to and reviewed by the CODM for the purposes of making decisions regarding the allocation of resources and are reconciled to condensed consolidated net income (loss) for the three and nine months ended September 30, 2025 and September 30, 2024 (in thousands):

THREE MONTHS ENDED

JUNE 30, SIX MONTHS ENDED

SEPTEMBER 30, NINE MONTHS ENDED

SEPTEMBER 30,

2025 2024 2025 2024

8 unchanged sentences

Total research and development expense ( 28,535 ) ( 38,893 ) ( 87,679 ) ( 170,376 )

( 22,267 ) ( 67,632 ) ( 59,144 ) ( 131,483 )

General and administrative expense

3 unchanged sentences

Total general and administrative expense ( 5,277 ) ( 7,904 ) ( 17,723 ) ( 111,244 )

( 6,422 ) ( 93,366 ) ( 12,446 ) ( 103,340 )

Other income (expense) ( 1,444 ) 2,933 ( 3,117 ) 2,016,959

8 unchanged sentences

Two primary enhancements related to this ASU include disaggregating existing income tax disclosures relating to the effective tax rate reconciliation and income taxes paid.

ASU 2023-09 is effective for annual periods beginning after December

15, 2024 on a prospective basis.

ASU 2023-09 is effective for annual periods beginning after December 15, 2024 on a prospective basis.

Early adoption is permitted.

9 unchanged sentences

Prepaid expense and other current assets were comprised of the following (in thousands):

JUNE 30, 2025 DECEMBER 31, 2024

Clinical drug substance and product manufacturing (1)

$ 2,480 $ 1,998

SEPTEMBER 30, 2025 DECEMBER 31, 2024

Clinical trials (1)

$ 2,815 $ 3,544

Clinical drug substance and product manufacturing (2)

Software licenses

2 unchanged sentences

Prepaid expense and other current assets $ 7,498 $ 7,382

(1) Relates primarily to the Company’s usage of third-party CDMOs for clinical and development efforts.

See “Accrued Research and Development Clinical Trial Costs” in Note 1 for further discussion of the components of research and development.

(1) Relates primarily to the Company’s prepayments to third-party CROs for management of clinical trials and prepayments for drug supply to be used in combination with the Company’s therapeutics.

See “Accrued Research and Development Clinical Trial Costs” in Note 1 for further discussion of the components of research and development.

(2) Relates primarily to the Company’s usage of third-party CDMOs for clinical and development efforts.

See “Accrued Research and Development Clinical Trial Costs” in Note 1 for further discussion of the components of research and development.

(3) Relates to the Company’s usage of third-parties for other research and development efforts.

2 unchanged sentences

Property and equipment, net were comprised of the following (in thousands):

JUNE 30, 2025 DECEMBER 31, 2024

SEPTEMBER 30, 2025 DECEMBER 31, 2024

Machinery and equipment $ 9,546 $ 9,758

2 unchanged sentences

Furniture, fixtures, and other 556 556

Construction in process 21 —

Total property and equipment 14,881 15,093

1 unchanged sentence

Property and equipment, net $ 4,306 $ 6,200

Depreciation and amortization expense for the three and six months ended June 30, 2025 and June 30, 2024 consisted of the following (in thousands):

Depreciation and amortization expense for the three and nine months ended September 30, 2025 and September 30, 2024 consisted of the following (in thousands):

THREE MONTHS ENDED

JUNE 30, SIX MONTHS ENDED

SEPTEMBER 30, NINE MONTHS ENDED

SEPTEMBER 30,

2025 2024 2025 2024

4 unchanged sentences

Accrued expenses were comprised of the following (in thousands):

JUNE 30, 2025 DECEMBER 31, 2024

SEPTEMBER 30, 2025 DECEMBER 31, 2024

Clinical trials (1)

2 unchanged sentences

Compensation-related 4,835 7,726

Professional fees 1,074 629

Interest on long-term debt

Professional fees 598 629

Other outside research and development (3)

20 unchanged sentences

Prior to the Separation, interest expense was calculated using the effective interest method and was inclusive of non-cash amortization of the debt discount and accretion of the final payment.

During the three months ended June 30, 2024, interest expense was $ 5.4 million, $ 0.8 million of which related to non-cash amortization of the debt discount and accretion of the final payment.

During the six months ended June 30, 2024, interest expense was $ 13.5 million, $ 2.1 million of which related to non-cash amortization of the debt discount and accretion of the final payment.

During the nine months ended September 30, 2024, interest expense was $ 13.5 million, $ 2.1 million of which related to non-cash amortization of the debt discount and accretion of the final payment.

The Company did no t incur any interest expense during the three months ended September 30, 2024.

2025 Loan Agreement

7 unchanged sentences

The Company has the option to prepay the outstanding balance of the term loan in full prior to the Maturity Date, subject to a prepayment fee ranging from 2.0 % to 5.0 %, depending on the timing of the prepayment.

As of June 30, 2025, the Company’s outstanding debt balance under the 2025 Loan Agreement consisted of the following (in thousands):

JUNE 30, 2025

As of September 30, 2025, the Company’s outstanding debt balance under the 2025 Loan Agreement consisted of the following (in thousands):

SEPTEMBER 30, 2025

Term loan $ 109,000

3 unchanged sentences

Future principal payments and final fee payments will be made as follows (in thousands):

JUNE 30, 2025

SEPTEMBER 30, 2025

2028 (10 months)

5 unchanged sentences

The 2025 Loan Agreement includes customary events of default, including instances of a material adverse change in the Company’s operations, that may require prepayment of the outstanding term loans.

As of June 30, 2025, the Company is in compliance with all covenants under the 2025 Loan Agreement and has not received any notification or indication from Oxford of an intent to declare the loan due prior to maturity.

As of September 30, 2025, the Company is in compliance with all covenants under the 2025 Loan Agreement and has not received any notification or indication from Oxford of an intent to declare the loan due prior to maturity.

Concurrently with the debt issuance in January 2025, the Company issued to Oxford warrants to purchase shares of the Company’s common stock equal to 2.0 % of the funded amount, or $ 2.0 million, or the 2025 Oxford Warrants.

5 unchanged sentences

Interest expense is calculated using the effective interest method and is inclusive of non-cash amortization of the debt discount and accretion of the final payment at an effective interest rate of 12.9 %.

During the three months ended June 30, 2025, interest expense was $ 3.1 million, $ 0.6 million of which related to non-cash amortization of the debt discount and accretion of the final payment.

During the six months ended June 30, 2025, interest expense was $ 5.8 million, $ 1.2 million of which related to non-cash amortization of the debt discount and accretion of the final payment.

During the three months ended September 30, 2025, interest expense was $ 3.2 million, $ 0.6 million of which related to non-cash amortization of the debt discount and accretion of the final payment.

During the nine months ended September 30, 2025, interest expense was $ 9.0 million, $ 1.8 million of which related to non-cash amortization of the debt discount and accretion of the final payment.

STOCKHOLDERS’ EQUITY

28 unchanged sentences

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance as of June 30, 2025 for the Company and December 31, 2024 for the Former Parent consisted of the following (in thousands):

JUNE 30, 2025 DECEMBER 31, 2024

Common stock reserved for future issuance as of September 30, 2025 for the Company and December 31, 2024 for the Former Parent consisted of the following (in thousands):

SEPTEMBER 30, 2025 DECEMBER 31, 2024

Options to purchase common stock issued and outstanding 3,590 3,660

Shares available for future equity grants 353 340

Pre-funded warrants issued and outstanding 992 992

Shares available for future equity grants 389 340

Warrants issued and outstanding 141 —

7 unchanged sentences

The options were subject to four-year vesting with a one-year cliff and had a contractual term of 10 years.

The aggregate intrinsic value of stock options exercised during the six months ended June 30, 2024 was $ 65.3 million.

The aggregate intrinsic value of stock options exercised during the nine months ended September 30, 2024 was $ 65.3 million.

Aggregate intrinsic value of stock options exercised was calculated using the fair value of common stock on the date of exercise.

The total fair value of stock options vested during the six months ended June 30, 2024 was $ 42.5 million.

The total fair value of stock options vested during the nine months ended September 30, 2024 was $ 42.5 million.

Following the Merger, there was no activity under the 2017 Plan and no stock options remained outstanding under the 2017 Plan.

4 unchanged sentences

Stock-Based Compensation Expense

The Company did no t grant any stock options under the 2017 Plan during the six months ended June 30, 2025 or June 30, 2024.

The Company did no t grant any stock options under the 2017 Plan during the nine months ended September 30, 2025 or September 30, 2024.

Stock-based compensation expense for stock options under the 2017 Plan consisted of the following (in thousands):

THREE MONTHS ENDED

JUNE 30, 2024 SIX MONTHS ENDED

JUNE 30, 2024

NINE MONTHS ENDED

SEPTEMBER 30, 2024

Research and development $ 32,809

1 unchanged sentence

Total stock-based compensation expense $ 51,534

No expense was recognized under the 2017 Plan during the six months ended June 30, 2025.

As of June 30, 2025, the Company had no remaining unrecognized stock-based compensation expense related to its stock options under the 2017 Plan following the termination of the plan subsequent to the Merger.

No expense was recognized under the 2017 Plan during the three and nine months ended September 30, 2025 or the three months ended September 30, 2024.

As of September 30, 2025, the Company had no remaining unrecognized stock-based compensation expense related to its stock options under the 2017 Plan following the termination of the plan subsequent to the Merger.

In connection with the Separation, the Company adopted the 2024 Omnibus Incentive Plan, or the 2024 Plan, which provides for the issuance of incentive stock options, restricted and unrestricted stock awards, and other stock-based awards.

As of June 30, 2025, an aggregate of 4.0 million shares of common stock were authorized for issuance under the 2024 Plan, of which 0.4 million remained available for issuance.

As of September 30, 2025, an aggregate of 4.0 million shares of common stock were authorized for issuance under the 2024 Plan, of which 0.4 million remained available for issuance.

Stock Option Activity

3 unchanged sentences

All options have a contractual term of 10 years.

A summary of the Company’s stock option activity under its 2024 Plan for the six months ended June 30, 2025 is as follows (in thousands, except for per share data and years):

A summary of the Company’s stock option activity under its 2024 Plan for the nine months ended September 30, 2025 is as follows (in thousands, except for per share data and years):

Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term

3 unchanged sentences

Granted 378 $ 17.86

Exercised ( 22 ) $ 15.86

Forfeited ( 426 ) $ 15.86

Outstanding as of June 30, 2025

Outstanding as of September 30, 2025

3,590 $ 16.05 8.7 $ 63

Vested and exercisable as of June 30, 2025

Vested and exercisable as of September 30, 2025

1,176 $ 15.84 8.3 $ 21

No stock options were exercised during the six months ended June 30, 2025 or June 30, 2024.

The total fair value of stock options vested during the six months ended June 30, 2025 was $ 11.9 million.

No stock options vested during the six months ended June 30, 2024.

The aggregate intrinsic value of stock options exercised during the nine months ended September 30, 2025 was $ 0.2 million.

There were no stock options exercised during the nine months ended September 30, 2024.

The total fair value of stock options vested during the nine months ended September 30, 2025 was $ 15.0 million.

No stock options vested during the nine months ended September 30, 2024.

The Company expects all outstanding stock options to vest.

Stock-Based Compensation Expense

The weighted-average assumptions used by the Company to estimate the fair value of stock option grants using the Black-Scholes option pricing model, as well as the resulting weighted-average fair value, for the six months ended June 30, 2025 and June 30, 2024 were as follows:

SIX MONTHS ENDED

The weighted-average assumptions used by the Company to estimate the fair value of stock option grants using the Black-Scholes option pricing model, as well as the resulting weighted-average fair value, for the nine months ended September 30, 2025 and September 30, 2024 were as follows:

NINE MONTHS ENDED

SEPTEMBER 30,

Risk-free interest rate 3.92 % 4.56 %

5 unchanged sentences

THREE MONTHS ENDED

JUNE 30, SIX MONTHS ENDED

SEPTEMBER 30, NINE MONTHS ENDED

SEPTEMBER 30,

2025 2024 2025 2024

2 unchanged sentences

Total stock-based compensation expense $ 3,175 $ 2,965 $ 8,395 $ 4,002

As of June 30, 2025, the Company had $ 30.4 million of total unrecognized stock-based compensation expense related to its stock options, which is expected to be recognized over a weighted-average period of 2.9 years.

As of September 30, 2025, the Company had $ 28.7 million of total unrecognized stock-based compensation expense related to its stock options, which is expected to be recognized over a weighted-average period of 2.8 years.

LICENSE REVENUES

The following table summarizes the total revenue recorded in the Company’s condensed consolidated statements of operations (in thousands):

THREE MONTHS ENDED

JUNE 30, SIX MONTHS ENDED

2025 2024 2025 2024

The following table summarizes the total revenue recorded in the Company’s condensed consolidated statements of operations (in thousands) during the nine months ended September 30, 2025 and September 30, 2024:

NINE MONTHS ENDED

SEPTEMBER 30,

License fee revenue

Scithera, Inc.

$ 1,300 $ — $ 1,300 $ —

Regeneron Pharmaceuticals, Inc.

Total license fee revenue $ 1,300 $ 100

The Company did no t recognize any revenue during the three months ended September 30, 2025 or September 30, 2024.

License and Collaboration Agreements

5 unchanged sentences

Contingent upon Scithera’s achievement of specified funding events, Scithera was required to pay the Company $ 1.3 million as a non-refundable payment.

In addition, Scithera may make additional future milestone payments of up to an aggregate of $ 41.25 million per target upon the achievement of certain milestone events, and potential royalty payments on net sales in the low- to mid-single digits.

In addition, Scithera may make additional future milestone payments of

up to an aggregate of $ 41.25 million per target upon the achievement of certain milestone events, and potential royalty payments on net sales in the low- to mid-single digits.

As of the effective date of the agreement, the Company identified one performance obligation, which was the transfer of licenses to Scithera for the specified assets and all related materials and know-how.

4 unchanged sentences

During the second quarter of 2025, the Company completed its single performance obligation and recognized $ 1.3 million at the point in time upon the completion of the transfer of all licensed materials and know-how.

The Company recognized $ 1.3 million of revenue under the Scithera License Agreement during the three and six months ended June 30, 2025.

The Company received a payment of $ 1.3 million under the Scithera License Agreement during the three and six months ended June 30, 2025.

During the nine months ended September 30, 2025, the Company recognized $ 1.3 million of revenue and received a payment of $ 1.3 million under the Scithera License Agreement.

The Company did not recognize any revenue or receive any payments under the Scithera License Agreement during the three months ended September 30, 2025.

In June 2020, the Company entered into an Option and License Agreement with bluebird bio, Inc., or bluebird, pursuant to which the Company granted to bluebird exclusive worldwide rights to develop binders and cell therapy products containing single domain antibodies, or sdAbs, directed to specified targets, consisting of two initial programs and up to an additional 8 programs.

10 unchanged sentences

The option period for this program expired in May 2025.

During each of the three and six months ended June 30, 2024, the Company recognized $ 0.1 million of revenue related to this agreement.

The Company did not recognize any revenue under this agreement during the three and six months ended June 30, 2025.

During the nine months ended September 30, 2024, the Company recognized $ 0.1 million of revenue related to this agreement.

The Company did not recognize any revenue under this agreement during the three months ended September 30, 2024 or the three and nine months ended September 30, 2025.

RELATED PARTY TRANSACTIONS

6 unchanged sentences

Transition Services Agreement

with certain transition services for a limited time to ensure an orderly transition following the Separation.

In connection with the Separation, the Company also entered into the Transition Services Agreement with the Former Parent under which the Company or one of its affiliates provide the Former Parent or other Sanofi entities with certain transition services for a limited time to ensure an orderly transition following the Separation.

The services that the Company agreed to provide to the Former Parent or other Sanofi entities under the Transition Services Agreement include certain finance and accounting, including payroll, tax, and procurement, information technology, legal and intellectual property, clinical study support, technical operations, regulatory, quality assurance, commercial and medical affairs, and other services.

The Former Parent pays the Company for any such services received by the Former Parent or other Sanofi entities, as applicable, at agreed amounts as set forth in the Transition Services Agreement.

During the three and six months ended June 30, 2025, the Company did not bill the Former Parent for any services performed under the Transition Services Agreement.

During the six months ended June 30, 2025, the Company received payments of approximately $ 23,000 of previously billed services and following receipt, had no remaining receivables from related parties under the agreement.

During the second quarter of 2025, the Company substantially completed all obligations under the Transition Services Agreement.

The Company has not billed the Former Parent for any services under the Transition Services during the nine months ended September 30, 2025 and does not expect any future billings.

During the nine months ended September 30, 2025, the Company received payments of approximately $ 23,000 of previously billed services and following receipt, had no remaining receivables from related parties under the agreement.

COMMITMENTS AND CONTINGENCIES

9 unchanged sentences

As a result, the Company remeasured the operating lease liability, resulting in an increase to its operating lease liability and right-of-use asset of $ 6.3 million as of the lease’s commencement date, which was determined to be the effective date of the 2024 Lease Agreement.

The Company utilized an estimated incremental fully collateralized borrowing rate of 10.2 % in its present value calculation as the 2024 Lease Agreement, which does not have a stated rate and did not have a readily determinable implicit rate.

The Company utilized an estimated incremental fully collateralized borrowing rate of 10.2 % in its present value calculation as the

2024 Lease Agreement, which does not have a stated rate and did not have a readily determinable implicit rate.

The estimated rate was determined using the rate of the 2025 Loan Agreement with Oxford entered into in January 2025.

The operating right-of-use asset and operating lease liability as of June 30, 2025 and December 31, 2024 were as follows (in thousands):

JUNE 30, 2025 DECEMBER 31, 2024

The operating right-of-use asset and operating lease liability as of September 30, 2025 and December 31, 2024 were as follows (in thousands):

SEPTEMBER 30, 2025 DECEMBER 31, 2024

Operating right-of-use asset

4 unchanged sentences

Total operating lease liability $ 6,988 $ 8,048

During the three months ended June 30, 2025 and June 30, 2024, the Company recognized operating lease expense of $ 0.9 million and $ 0.8 million, respectively.

During the six months ended June 30, 2025 and June 30, 2024, the Company recognized operating lease expense of $ 1.9 million and $ 1.6 million, respectively.

During each of the three months ended June 30, 2025 and June 30, 2024, the Company paid $ 0.6 million in cash for amounts included in the measurement of the operating lease liability.

During the six months ended June 30, 2025 and June 30, 2024, the Company paid $ 0.9 million and $ 1.1 million in cash for amounts included in the measurement of the operating lease liability, respectively.

As of June 30, 2025 and December 31, 2024, the Company’s operating lease had a remaining term of 3.0 years and 3.5 years, respectively.

During the three months ended September 30, 2025 and September 30, 2024, the Company recognized operating lease expense of $ 1.0 million and $ 0.9 million, respectively.

During the nine months ended September 30, 2025 and September 30, 2024, the Company recognized operating lease expense of $ 2.9 million and $ 2.5 million, respectively.

During the three months ended September 30, 2025 and September 30, 2024, the Company paid $ 0.7 million and $ 0.4 million in cash for amounts included in the measurement of the operating lease liability, respectively.

During the nine months ended September 30, 2025 and September 30, 2024, the Company paid $ 1.6 million and $ 1.5 million in cash for amounts included in the measurement of the operating lease liability, respectively.

As of September 30, 2025 and December 31, 2024, the Company’s operating lease had a remaining term of 2.75 years and 3.5 years, respectively.

The Company discounts its lease payments using its incremental borrowing rate as of the commencement of the lease.

The Company determined a weighted-average discount rate of 10.2 % as of June 30, 2025 and December 31, 2024.

The Company determined a weighted-average discount rate of 10.2 % as of September 30, 2025 and December 31, 2024.

Future minimum rental commitments for the Company’s operating leases reconciled to the operating lease liability are as follows (in thousands):

JUNE 30, 2025

2025 (six months)

SEPTEMBER 30, 2025

2025 (three months) $ 703

Total future minimum lease payments 7,991

7 unchanged sentences

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