What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-14 compared with 2024-08-14 · 236 added, 192 removed, 561 unchanged (43% of the section changed)

3 unchanged sentences

(In thousands, except share and per share amounts)

September 30,

Current assets:

11 unchanged sentences

Accrued expenses (1)

Deferred revenue

Operating lease liabilities, current

8 unchanged sentences

10,000,000 shares

authorized and no shares issued and outstanding at June 30, 2024

authorized and no shares issued and outstanding at September 30, 2024

and December 31, 2023

1 unchanged sentence

1,000,000,000 shares authorized,

119,442,635 shares issued and outstanding at June 30, 2024;

119,604,035 shares issued and outstanding at September 30, 2024;

110,160,684 shares issued and outstanding at December 31, 2023

4 unchanged sentences

Total liabilities, preferred stock and stockholders’ equity

(1) Includes related-party amounts of $ 1,349 and $ 700 as of September 30, 2024 and December 31, 2023, respectively (see Note 15) .

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

2 unchanged sentences

(In thousands, except share and per share amounts)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Product revenue, net

11 unchanged sentences

Other comprehensive income (loss)

Unrealized gain on available-for-sale securities, net of tax

Unrealized (loss) gain, net of tax

Comprehensive loss

1 unchanged sentence

Weighted-average common shares outstanding, basic and diluted

(1) Includes related-party amounts of $ 1,131 and $ 2,266 for the three and six months ended June 30, 2024 , respectively, and $ 2,258 and $ 5,218 for the three and six months ended June 30, 2023, respectively (see Note 15).

(2) Includes no related-party amounts for both the three and six months ended June 30, 2024 , and $ 0 and $ 375 for the three and six months ended June 30, 2023, respectively (see Note 15).

(1) Includes related-party amounts of $ 463 for both the three and nine months ended September 30, 2024 , and no related-party amounts for both the three and nine months ended September 30, 2023 (see Note 15) .

(2) Includes related-party amounts of $ 1,133 and $ 3,399 for the three and nine months ended September 30, 2024 , respectively, and related-party amounts of $ 1,448 and $ 6,666 for the three and nine months ended September 30, 2023, respectively (see Note 15).

(3) Includes no related-party amounts for both the three and nine months ended September 30, 2024 , and related-party amounts of $ 4,600 and $ 4,975 for the three and nine months ended September 30, 2023, respectively (see Note 15).

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

8 unchanged sentences

Balances at December 31, 2023

Vesting of restricted common stock

from early-exercised options

Exercise of stock options

Repurchase of unvested restricted

Retirement of treasury stock

Stock-based compensation expense

Issuance of common stock, net of

issuance costs

Issuance of common stock under the

employee stock purchase plan

Unrealized gain on available-for-sale

securities, net of tax

Unrealized gain, net of tax

Balances at March 31, 2024

Vesting of restricted common stock

from early-exercised options

Exercise of stock options

Repurchase of unvested restricted

Retirement of treasury stock

Stock-based compensation expense

Exercise of stock options

Issuance of common stock under the

employee stock purchase plan

Unrealized gain on available-for-sale

securities, net of tax

Balances at June 30, 2024

Stock-based compensation expense

Exercise of stock options

Issuance of common stock under the

employee stock purchase plan

Unrealized loss, net of tax

Balances at September 30, 2024

Treasury Stock

4 unchanged sentences

Balances at December 31, 2022

Vesting of restricted common stock

from early-exercised options

Exercise of stock options

Repurchase of unvested restricted

Retirement of treasury stock

Stock-based compensation expense

Issuance of common stock, net of

issuance costs

Issuance of common stock under the

employee stock purchase plan

Unrealized gain on available-for-sale

securities, net of tax

Unrealized gain, net of tax

Balances at March 31, 2023

Stock-based compensation expense

Vesting of restricted common stock

from early-exercised options

Exercise of stock options

Repurchase of unvested restricted

Retirement of treasury stock

Stock-based compensation expense

Issuance of common stock under the

employee stock purchase plan

Unrealized gain, net of tax

Balances at June 30, 2023

Vesting of restricted common stock

from early-exercised options

Exercise of stock options

Repurchase of unvested restricted

Retirement of treasury stock

Stock-based compensation expense

Issuance of common stock under the

employee stock purchase plan

Unrealized gain, net of tax

Balances at September 30, 2023

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

2 unchanged sentences

(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from operating activities:

10 unchanged sentences

Accrued expenses

Deferred revenue

Operating lease liabilities

17 unchanged sentences

Cash and cash equivalents at end of period

Supplemental disclosure of cash flow information

Deferred offering costs in accrued expense

Deferred offering costs in accounts payable

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

5 unchanged sentences

The Company’s proprietary INVYMAB platform approach combines state-of-the-art viral surveillance and predictive modeling with advanced antibody engineering.

INVYMAB is designed to facilitate the rapid, serial generation of new monoclonal antibodies (“mAbs”) to keep pace with evolving viral threats.

INVYMAB is designed to facilitate the rapid, serial generation of new monoclonal antibodies (“mAbs”) to address evolving viral threats.

On March 22, 2024, the Company received emergency use authorization (“EUA”) from the U.S.

8 unchanged sentences

As the SARS-CoV-2 virus evolves over time, the Company anticipates leveraging its INVYMAB platform approach to periodically introduce new or engineered mAb candidates, an approach that would be analogous to the periodic updates made to influenza and COVID-19 vaccines.

In January 2024, the Company nominated VYD2311, a mAb optimized for neutralization potency against prominent SARS-CoV-2 variants, as a drug candidate, and the Company expects it will be the next pipeline program to advance into clinical development.

In January 2024, the Company nominated VYD2311, a next generation mAb candidate for COVID-19, as a drug candidate, and in September 2024, the Company announced dosing of the first participants in a Phase 1 clinical trial of VYD2311.

VYD2311 is a mAb with high in vitro neutralization potency shown against prominent SARS-CoV-2 variants tested to date.

The Phase 1 randomized, blinded, placebo-controlled clinical trial will evaluate escalating dosing as well as safety, tolerability, pharmacokinetics and immunogenicity of VYD2311 in healthy trial participants.

The Phase 1 clinical trial is being conducted in Australia and will evaluate multiple dose levels of VYD2311 through various routes of administration, including exploration of intramuscular administration and subcutaneous administration, which are designed to be more system- and patient-friendly than intravenous administration.

The Company expects preliminary data readouts from the Phase 1 clinical trial late in the fourth quarter of 2024 and anticipates additional clinical readouts from the VYD2311 program throughout 2025.

Like pemivibart, VYD2311 was engineered from adintrevimab, the Company’s investigational mAb that has a robust safety data package and demonstrated clinically meaningful results in global Phase 2/3 clinical trials for both the prevention and treatment of COVID-19.

In May 2024, the Company announced general alignment with the FDA on an expedient, repeatable immunobridging pathway to future potential EUAs for serial, novel mAbs for the prevention and treatment of symptomatic COVID-19.

3 unchanged sentences

The Company operates as a hybrid company with employees working at its corporate headquarters in Waltham, Massachusetts and remotely.

In June 2022, and subsequently amended in September 2022, the Company entered into a lease for dedicated laboratory and office space in Newton, Massachusetts for research and development purposes.

In 2022, the Company expanded its research team in order to enable internal discovery and development of its mAb candidates, while continuing to leverage the Company’s existing partnership with Adimab, LLC (“Adimab”).

In June 2022, and subsequently amended in September 2022 and August 2024, the Company entered into a lease for dedicated laboratory and office space in Newton, Massachusetts for research and development purposes.

In 2022, the Company expanded its research team to enable internal discovery and development of its mAb candidates, while continuing to leverage the Company’s existing partnership with Adimab, LLC (“Adimab”).

The Company is focused on antibody discovery and use of Adimab’s platform technology while building its own internal capabilities.

2 unchanged sentences

To date, the Company has received regulatory authorization for only one product candidate, PEMGARDA, which has not been approved, but has been authorized for emergency use by the FDA under an EUA, for pre-exposure prophylaxis of COVID-19 in certain adults and adolescent individuals (12 years of age and older weighing at least 40 kg).

Beyond VYD222 (pemivibart) and VYD2311, all of the Company’s other product candidates, other than adintrevimab, are currently in preclinical development.

Beyond VYD222 (pemivibart) and VYD2311, all of the Company’s other product candidates, other than adintrevimab, are currently in research development.

The Company’s additional product candidates require significant additional research and development efforts, including extensive clinical testing, and regulatory authorization or approval prior to potential commercialization.

6 unchanged sentences

After receiving EUA in March 2024, the Company has also funded its operations from sales of PEMGARDA.

The Company has incurred losses and negative cash flows from operations since its inception, including a net loss of $ 90.7 million for the six months ended June 30, 2024.

As of June 30, 2024, the Company had an accumulated deficit of $ 822.8 million.

The Company has incurred losses and negative cash flows from operations since its inception, including a net loss of $ 151.5 million for the nine months ended September 30, 2024.

As of September 30, 2024, the Company had an accumulated deficit of $ 883.6 million.

The Company may continue to generate operating losses for the foreseeable future.

5 unchanged sentences

Although management continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company to fund continuing operations, if at all.

The accompanying condensed consolidated financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities or any other adjustments that might be necessary should the Company be unable to continue as a going concern.

Basis of Presentation

6 unchanged sentences

The Company views its operations and manages its business in one operating segment, which is the business of discovering, developing and commercializing differentiated products for the prevention and treatment of infectious diseases.

Unaudited Interim Financial Information

The accompanying condensed consolidated balance sheet as of September 30, 2024, the condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2024 and 2023, the condensed consolidated statements of cash flows for the three and nine months ended September 30, 2024 and 2023 and the condensed consolidated statements of stockholders’ equity (deficit) for the three and nine months ended September 30, 2024 and 2023 are unaudited.

The accompanying unaudited condensed consolidated financial statements as of September 30, 2024 and for the three and nine months ended September 30, 2024 and 2023, have been prepared by the Company pursuant to the rules and regulations of the SEC for interim financial statements.

The accompanying condensed consolidated balance sheet as of December 31, 2023 was derived from audited financial statements, but does not include all disclosures required by U.S.

Certain information and footnote disclosures

normally included in the financial statements prepared in accordance with U.S.

GAAP have been condensed or omitted pursuant to such rules and regulations.

These interim condensed consolidated financial statements should be read in conjunction with the Company’s audited annual consolidated financial statements, and the notes thereto, as of and for the year ended December 31, 2023, which are included in the 2023 Form 10-K.

In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s condensed consolidated financial position as of September 30, 2024 and December 31, 2023, the condensed consolidated results of operations for the three and nine months ended September 30, 2024 and 2023, the condensed consolidated cash flows for the three and nine months ended September 30, 2024 and 2023, and changes in stockholders’ equity (deficit) for the three and nine months ended September 30, 2024 and 2023 have been made.

The Company’s condensed consolidated results of operations for the three and nine months ended September 30, 2024 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2024 .

Summary of Significant Accounting Policies

As of June 30, 2024, the Company’s significant accounting policies and estimates, which are detailed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the U.S.

As of September 30, 2024, the Company’s significant accounting policies and estimates, which are detailed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the U.S.

Securities and Exchange Commission (“SEC”) on March 28, 2024 (the “2023 Form 10-K”) have not changed, except as discussed below.

7 unchanged sentences

Financial instruments that potentially expose the Company to concentrations of credit risk consist of cash, cash equivalents and accounts receivable.

As of June 30, 2024, the Company invested its excess cash in money market funds that are subject to minimal credit and market risks.

The Company maintains its existing cash and cash equivalents at three accredited financial institutions that it believes are creditworthy.

As of September 30, 2024, the Company invested its excess cash in money market funds that are subject to minimal credit and market risks.

The Company maintains its existing cash and cash equivalents at three accredited financial institutions.

From time to time, these deposits may exceed federally insured limits.

1 unchanged sentence

Accordingly, the Company does not believe it is exposed to unusual credit risk related to its existing cash and cash equivalents beyond the normal credit risk associated with commercial banking relationships.

As of June 30, 2024, the Company had one third-party logistics distribution agent under the temporary title model which accounted for all of the Company’s net product revenue (see “Revenue Recognition” for additional information).

As of September 30, 2024, the Company's net product revenue was generated from sales to the Title Company (as defined below) and three third-party specialty distributors (see “Revenue Recognition” for additional information).

The Company is dependent on third-party organizations to manufacture and process its product candidates for its research and development programs.

4 unchanged sentences

The Company is dependent on a limited number of third parties that provide license rights used by the Company in the development and commercialization of its product candidates and programs.

Through June 30, 2024 , the Company’s research and development programs primarily relate to rights conveyed by Adimab (see Note 7).

Through September 30, 2024 , the Company’s research and development programs primarily relate to rights conveyed by Adimab (see Note 7).

The Company could experience delays in the development and commercialization of its product candidates and programs if the Adimab agreements or any other license agreement utilized in the Company’s research and development activities is terminated, if the Company fails to meet the obligations required under its arrangements, or if the Company is unable to successfully secure new strategic alliances or licensing agreements.

Accounts Receivable

Accounts receivable as of June 30, 2024 is comprised of $ 2.9 million of PEMGARDA product sales to the Title Company (as defined below) (see “Revenue Recognition” for additional information).

Accounts receivable as of September 30, 2024 is comprised of $ 8.2 million of PEMGARDA product sales to the Title Company (as defined below) and three third-party specialty distributors (see “Revenue Recognition” for additional information).

Revenue Recognition

9 unchanged sentences

The 3PL Agent provides services to the Company that include storage, distribution, processing product returns, customer service support, logistics support, electronic data interface and system access support.

Revenue is recognized when or as performance obligations are satisfied by transferring control of promised goods to a customer.

To date, the Company applied for mandatory distribution licenses that some states require in order for the Company to sell its product throughout the U.S.

Revenue is recognized when or as performance obligations are satisfied by transferring control of promised goods to a customer, generally upon delivery, based on an amount that reflects the consideration to which the Company expected to be entitled.

To date, the Company applied for mandatory distribution licenses that some states require for the Company to sell its product throughout the U.S.

In order for the Company to execute sales in the U.S.

prior to obtaining such licenses, the Company and an affiliate of the 3PL Agent (the “Title Company”) entered into a Temporary Title Model Agreement (the “Temporary Title Model Agreement”), which was an amendment to the 3PL Agreement, so that the Title Company may purchase and take title to the product and sell the product to the specialty distributors who have contracted to purchase the product from the Company.

Although under the Temporary Title Model Agreement, the Title Company takes title to the product, the economic substance of the transaction provides that the Title Company does not possess the risk of loss or participate in the significant risks and rewards of ownership of the product

or have the ability to control, direct the use of, and obtain substantially all of the remaining benefits from the product.

Accordingly, the Company does not recognize revenue upon the transfer of the goods at the time of sale to the Title Company and recognizes revenue when the goods are sold from the Title Company to the specialty distributors.

prior to obtaining such licenses, the Company and an affiliate of the 3PL Agent (the “Title Company”) entered into a Temporary Title Model Agreement (the “Temporary Title Model Agreement”), which was an amendment to the 3PL Agreement, so that the Title Company could purchase and take title to the product and sell the product to the specialty distributors who contracted to purchase the product from the Company.

Although under the Temporary Title Model Agreement, the Title Company took title to the product, the economic substance of the transaction provided that the Title Company did not possess the risk of loss or participate in the significant risks and rewards of ownership of the product or have the ability to control, direct the use of, and obtain substantially all of the remaining benefits from the product.

Accordingly, the Company did not recognize revenue upon the transfer of the goods at the time of sale to the Title Company and recognized revenue when the goods were sold from the Title Company to the specialty distributors.

In July 2024, the Company obtained nearly all of the necessary state distribution licenses to sell its products throughout the U.S.

and, after a customary period of notice to the Title Company, intends to cease using the Temporary Title Model Agreement process in the third quarter of 2024.

and ceased using the Temporary Title Model Agreement process in the third quarter of 2024.

Product revenues are recorded net of applicable reserves for variable consideration, including discounts and allowances.

7 unchanged sentences

Government Chargebacks and Rebates

The Company is subject to discount obligations under its contract with the Department of Veterans Affairs.

The Company is subject to discount obligations under its contract with the U.S.

Department of Veterans Affairs.

These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability, which is included as a component of accrued expenses.

1 unchanged sentence

The Company offers a right of return for purchased units of PEMGARDA for damage, defect, recall, and/or product expiry, provided the product expiry is within a specified period as set forth in the Company’s return goods policy.

The Company estimates the amount of product sales that will be returned using quantitative and qualitative considerations.

The Company estimates the

amount of product sales that will be returned using quantitative and qualitative considerations.

Reserves for estimated returns are recorded as a reduction of product revenue in the period that the related revenue is recognized, as well as a component of accrued expenses.

2 unchanged sentences

The co-pay assistance program assists certain commercially insured patients by reducing each participating patient’s financial responsibility for the purchase price, up to a specified dollar amount of assistance.

Unaudited Interim Financial Information

The accompanying condensed consolidated balance sheet as of June 30, 2024, the condensed consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2024 and 2023, the condensed consolidated statements of cash flows for the three and six months ended June 30, 2024 and 2023 and the condensed consolidated statements of stockholders’ equity (deficit) for the three and six months ended June 30, 2024 and 2023 are unaudited.

The accompanying unaudited condensed consolidated financial statements as of June 30, 2024 and for the three and six months ended June 30, 2024 and 2023, have been prepared by the Company pursuant to the rules and regulations of the SEC for interim financial statements.

The accompanying condensed consolidated balance sheet as of December 31, 2023 was derived from audited financial statements, but does not include all disclosures required by U.S.

Certain information and footnote disclosures normally included in the financial statements prepared in accordance with U.S.

GAAP have been condensed or omitted pursuant to such rules and regulations.

In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s condensed consolidated financial position as of June 30, 2024 and December 31, 2023, the condensed consolidated results of operations for the three and six months ended June 30, 2024 and 2023, the condensed consolidated cash flows for the three and six months ended June 30, 2024 and 2023 and changes in stockholders’ equity (deficit) for the three and six months ended June 30,

2024 and 2023 have been made.

The Company’s condensed consolidated results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2024 .

Use of Estimates

The preparation of the Company’s condensed consolidated financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of expenses during the reporting periods.

Significant estimates and assumptions reflected in these condensed consolidated financial statements include, but are not limited to, research and development expenses and related prepaid or accrued costs and stock-based compensation expense.

The Company bases its estimates on historical experience, known trends and other market-specific or relevant factors it believes to be reasonable under the circumstances.

13 unchanged sentences

The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024.

The Company is currently evaluating the potential impacts of ASU 2023-07 on the consolidated financial statements and related disclosures.

The Company is currently evaluating the potential impacts of ASU 2023-07 on its consolidated financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

3 unchanged sentences

The guidance also eliminates certain existing disclosure requirements related to uncertain tax positions and unrecognized deferred tax liabilities.

The guidance is effective for all entities for annual periods beginning after December 15, 2025.

The guidance is effective for the Company for the annual period beginning after December 15, 2024.

All entities should apply the guidance prospectively but have the option to apply it retrospectively.

Early adoption is permitted.

The Company is continuing to assess the timing of adoption and the potential impacts of ASU 2023-09 on the consolidated financial statements and related disclosures.

The Company is currently evaluating the potential impacts of ASU 2023-09 on its consolidated financial statement disclosures.

Fair Value Measurements

11 unchanged sentences

Fair Value Measurements at

June 30, 2024:

September 30, 2024:

Cash equivalents:

5 unchanged sentences

The money market funds were valued by the Company based on quoted market prices, which represent a Level 1 measurement within the fair value hierarchy.

There were no changes to the valuation methods during the three and six months ended June 30, 2024 or 2023.

There were no changes to the valuation methods during the three and nine months ended September 30, 2024 or 2023.

The Company evaluates transfers between levels at the end of each reporting period.

There were no transfers into or out of Level 1, Level 2 or Level 3 fair value measurements during the three and six months ended June 30, 2024 or 2023.

There were no transfers into or out of Level 1, Level 2 or Level 3 fair value measurements during the three and nine months ended September 30, 2024 or 2023.

The following table presents inventories (in thousands):

September 30,

Work in process

3 unchanged sentences

Prepaid expenses and other current assets consisted of the following (in thousands):

September 30,

Prepaid external research, development and manufacturing costs

1 unchanged sentence

Prepaid compensation and other

Prepaid inventory

Interest receivable

1 unchanged sentence

Accrued expenses consisted of the following (in thousands):

September 30,

Accrued external research, development and manufacturing costs

16 unchanged sentences

Amounts paid with respect to services performed by Adimab on the Company’s behalf under the Adimab Assignment Agreement are recognized as research and development expense as such amounts are incurred.

During the three and six months ended June 30, 2024 and 2023 , the Company did no t recognize any research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab Assignment Agreement.

During the three and nine months ended September 30, 2024 and 2023 , the Company did no t recognize any research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab Assignment Agreement.

Please refer to Note 15 for additional information.

The Company is obligated to pay Adimab up to $ 16.5 million upon the achievement of specified development and regulatory milestones for the first Product under the agreement that achieves such specified milestones and up to $ 8.1 million upon the achievement of specified development and regulatory milestones for the second Product under the agreement that achieves such specified milestones.

The maximum aggregate amount of milestone payments payable under the agreement for any and all Products is $ 24.6 million , of which a total of $ 11.1 million has been achieved and paid as of June 30, 2024;

however, milestone payments do not accrue for certain in vitro diagnostic devices consisting of or containing CoV Antibodies.

2 unchanged sentences

The next potential milestone under the Adimab Assignment Agreement is a low single-digit million-dollar regulatory milestone, which was not considered probable under U.S.

GAAP and therefore, no expense was recognized as of June 30, 2024.

During both the three and six months ended June 30, 2024, the Company did no t recognize any in-process research and development (“IPR&D”) expense with respect to contingent consideration payable under the Adimab Assignment Agreement.

During the three and six months ended June 30, 2023, the Company recognized $ 0 and $ 0.4 million, respectively, of IPR&D expense with respect to contingent consideration payable under the Adimab Assignment Agreement.

GAAP and therefore, no expense was recognized as of September 30, 2024.

During both the three and nine months ended September 30, 2024, the Company did no t recognize any in-process research and development (“IPR&D”) expense with respect to contingent consideration payable under the Adimab Assignment Agreement.

During the three and nine months ended September 30, 2023, the Company recognized $ 3.2 and $ 3.6 million, respectively, of IPR&D expense

with respect to contingent consideration payable under the Adimab Assignment Agreement.

Except for milestone payments of $ 11.1 million incurred through December 31, 2023, no other milestone payments have been paid to or have been earned by Adimab through September 30, 2024.

The Company is obligated to pay Adimab royalties of a mid-single-digit percentage based on net sales of any Products, beginning upon the first commercial sale of a Product in accordance with the Adimab Assignment Agreement.

1 unchanged sentence

Royalties are due on a Product-by-Product and country-by-country basis beginning upon the first commercial sale of each Product and ending on the later of (i) 12 years after the first commercial sale of such Product in such country and (ii) the expiration of the last valid claim of a patent covering such Product in such country (the “Royalty Term”).

During both the three and nine months ended September 30, 2024 , the Company expensed $ 0.5 million of royalties and reserves all rights under the Adimab Assignment Agreement and the applicable law.

During both the three and nine months ended September 30, 2023 , the Company did no t expense any royalties.

In addition, the Company is obligated to pay Adimab royalties of a specified percentage in the range of 45 % to 55 % of any compulsory sublicense consideration received by the Company in lieu of certain royalty payments.

Except for milestone payments of $ 11.1 million incurred through December 31, 2023, no other milestone, royalty or other contingent payments have been paid to or have been earned by Adimab through June 30, 2024.

Unless earlier terminated, the Adimab Assignment Agreement remains in effect until the expiration of the last-to-expire Royalty Term for any and all Products.

17 unchanged sentences

Effective January 2024, the Company became obligated to pay Adimab a quarterly fee of $ 0.6 million.

During the three and six months ended June 30, 2024 the Company recognized $ 0.6 million and $ 1.2 million, respectively, of research and development expense related to the quarterly fee.

During the three and six months ended June 30, 2023 , the Company recognized $ 1.3 million and $ 2.6 million, respectively, of research and development expense related to the quarterly fee.

During the three and nine months ended September 30, 2024 , the Company recognized $ 0.6 million and $ 1.8 million, respectively, of research and development expense related to the quarterly fee.

During the three and nine months ended September 30, 2023 , the Company recognized $ 1.3 million and $ 3.9 million, respectively, of research and development expense related to the quarterly fee.

For each agreed upon research program that is commenced, the Company is obligated to pay Adimab quarterly for its services performed during a given research program at a specified full-time equivalent rate;

3 unchanged sentences

Amounts paid with respect to services performed by Adimab on the Company’s behalf in each of the research programs under the Adimab Collaboration Agreement are recognized as research and development expense as such amounts are incurred and services are rendered.

During both the three and six months ended June 30, 2024, the Company did no t recognize any research and development expense with respect to services performed by Adimab on the Company ’s behalf under the Adimab Collaboration Agreement.

During the three and six months ended June 30, 2023 , the Company recognized $ 0.2 million and $ 0.4 million, respectively, of research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab Collaboration Agreement.

During the three and six months ended June 30, 2024 and 2023, the Company did no t recognize any IPR&D expense related to drug delivery fees, optimization completion fees or option exercise fees.

During both the three and nine months ended

September 30, 2024, the Company did no t recognize any research and development expense with respect to services performed by Adimab on the Company ’s behalf under the Adimab Collaboration Agreement.

During the three and nine months ended September 30, 2023 , the Company recognized $ 0.1 million and $ 0.5 million, respectively, of research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab Collaboration Agreement.

During the three and nine months ended September 30, 2024, the Company did no t recognize any IPR&D expense related to drug delivery fees, optimization completion fees or option exercise fees.

During both the three and nine months ended September 30, 2023 , the Company recognized $ 1.0 million, $ 0.2 million, and $ 0.2 million of IPR&D expense related to an option exercise fee, a drug delivery fee and an optimization completion fee, respectively.

Please refer to Note 15 for additional information.

1 unchanged sentence

The next potential milestone under the Adimab Collaboration Agreement is a low single-digit million-dollar clinical milestone, which was not considered probable under U.S.

GAAP and therefore, no expense was recognized as of June 30, 2024.

GAAP and therefore, no expense was recognized as of September 30, 2024.

The Company is also obligated to pay Adimab royalties of a mid-single-digit percentage based on net sales of any product under the Adimab Collaboration Agreement, subject to reductions for third-party licenses.

of matter or method of making or using any antibody identified or optimized under the Adimab Collaboration Agreement in such country.

The royalty term will expire for each product on a country-by-country basis upon the later of (i) 12 years after the first commercial sale of such product in such country and (ii) the expiration of the last valid claim of any patent claiming composition of matter or method of making or using any antibody identified or optimized under the Adimab Collaboration Agreement in such country.

In addition, the Company is obligated to pay Adimab for Adimab’s performance of certain validation work with respect to certain antigens acquired from a third party.

In consideration for this work, the Company is obligated to pay Adimab royalties of a low single-digit percentage based on net sales of products that contain such antigens for the same royalty term as antibody-based products, but the Company is not obligated to make any milestone payments for such antigen products.

Through June 30, 2024, no royalty payments have been paid to or have been earned by Adimab under the Adimab Collaboration Agreement.

Through September 30, 2024, no royalty payments have been paid to or have been earned by Adimab under the Adimab Collaboration Agreement.

The Adimab Collaboration Agreement will expire (i) if the Company does not exercise any option, upon the conclusion of the last Evaluation Term for the research programs, or (ii) if the Company exercises an option, on the expiration of the last royalty term for a product in a particular country, unless the agreement is earlier terminated.

13 unchanged sentences

The first annual fee became due in September 2023 and was paid in October 2023.

During the three and six months ended June 30, 2024, the Company recognized a portion of the first annual fee as research and development expense.

During the three and nine months ended September 30, 2024, the Company recognized a portion of the annual fees as research and development expense.

Beginning in July 2027 and ending in June 2042, unless terminated earlier, the Company has the option to receive additional material improvements to the platform technology from Adimab, subject to a commercially reasonable fee to be negotiated by the parties.

1 unchanged sentence

The next potential milestone under the Adimab Platform Transfer Agreement is a mid-six-digit dollar preclinical milestone, which was not considered probable under U.S.

GAAP and therefore, no expense was recognized as of June 30, 2024.

GAAP and therefore, no expense was recognized as of September 30, 2024.

In addition, the Company is obligated to pay Adimab royalties of a low single-digit percentage based on net sales of products containing an antibody discovered, engineered or optimized using Adimab’s platform technology, subject to reductions specified under the Adimab Platform Transfer Agreement.

1 unchanged sentence

The royalty term will expire for each product on a country-by-country basis upon the later of (i) 12 years after the first commercial sale of such product in such country and (ii) the expiration of the last valid claim of a program antibody patent for covering the program antibody contained in such product in such country.

Through June 30, 2024, no royalty payments have been paid to or have been earned by Adimab under the Adimab Platform Transfer Agreement.

Through September 30, 2024, no royalty payments have been paid to or have been earned by Adimab under the Adimab Platform Transfer Agreement.

The Company may terminate the Adimab Platform Transfer Agreement at any time upon advance written notice to Adimab.

12 unchanged sentences

Royalties are due on a Licensed Product-by-Licensed Product basis commencing on the date of the first commercial sale of the applicable product and continuing for so long as the Company commercializes Licensed Products or, if earlier, until the Company exercises its option to buy out the royalty obligations.

Through June 30, 2024 , no royalties had become due to WuXi Biologics.

Through September 30, 2024 , no royalties had become due to WuXi Biologics.

The Cell Line License Agreement remains in effect until it is terminated.

5 unchanged sentences

The Cell Line License Agreement did not qualify as a business combination because substantially all of the fair value of the assets acquired was concentrated in a single asset.

The Company did no t recognize any IPR&D expense under the Cell Line License Agreement during the three and six months ended June 30, 2024 .

The Company recognized $ 0.2 million and $ 0.6 million of IPR&D expense under the Cell Line License Agreement during the three and six months ended June 30, 2023 , respectively.

The Company did no t recognize any IPR&D expense under the Cell Line License Agreement during the three and nine months ended September 30, 2024 .

The Company recognized $ 0 and $ 0.6 million of IPR&D expense under the Cell Line License Agreement during the three and nine months ended September 30, 2023 , respectively.

Population Health Partners, L.P.

4 unchanged sentences

The PHP MSA was terminated effective in July 2024.

On the PHP Effective Date, the Company and PHP entered into the first work order under the PHP MSA (the “PHP Work Order”), pursuant to which PHP agreed to advise and counsel the Company regarding clinical development and regulatory matters with respect to the Company’s product candidates.

On the PHP Effective Date, the Company and PHP

entered into the first work order under the PHP MSA (the “PHP Work Order”), pursuant to which PHP agreed to advise and counsel the Company regarding clinical development and regulatory matters with respect to the Company’s product candidates.

The PHP Work Order was effective for six months from the PHP Effective Date and terminated in accordance with its terms in May 2023.

1 unchanged sentence

As compensation for the services and deliverables under the PHP Work Order, the Company paid PHP a cash fee of $ 0.5 million per month during the term of the PHP Work Order for an aggregate fee of $ 3.0 million (the “Aggregate Fee”).

During the three and six months ended June 30, 2024 , the Company did no t recognize any research and development expense related to the cash compensation paid to PHP.

During the three and six months ended June 30, 2023 , the Company recognized $ 0.8

million and $ 2.3 million, respectively, of research and development expense related to the cash compensation paid to PHP.

During the three and nine months ended September 30, 2024 , the Company did no t recognize any research and development expense related to the cash compensation paid to PHP.

During the three and nine months ended September 30, 2023 , the Company recognized $ 0 and $ 2.3 million, respectively, of research and development expense related to the cash compensation paid to PHP.

Please refer to Note 15 for additional information.

In addition to the cash compensation, on the PHP Effective Date, the Company issued a warrant to purchase shares of the Company’s common stock to PHP (the “PHP Warrant”).

The exercise price of the PHP Warrant is $ 3.48 per share of the Company’s common stock, which was equal to the Nasdaq official closing price (as defined in the PHP Warrant) of a share of the Company’s common stock on the trading day immediately prior to the PHP Effective Date.

The exercise price of the PHP Warrant is $ 3.48 per share of the Company’s common stock, which was equal to the Nasdaq official closing price of a share of the Company’s common stock on the trading day immediately prior to the PHP Effective Date.

The PHP Warrant is exercisable for up to an aggregate of 6,824,712 shares of the Company’s common stock, and vests in three separate tranches as follows:

14 unchanged sentences

In September 2021, the Company entered into a five-year noncancelable facilities lease agreement for approximately 9,600 square feet of office space in Waltham, Massachusetts, which provides for monthly rental payments, including base rent charges of $ 0.4 million per year, subject to periodic rent increases, and the Company’s proportionate share of operating expenses.

In June 2022, the Company entered into a two-year noncancelable agreement for dedicated laboratory and office space in Newton, Massachusetts, which was amended in September 2022 (the “Newton, MA Lease”).

Pursuant to the amended Newton, MA Lease, the Company entered into a two-year noncancelable agreement for new dedicated laboratory and office space in Newton, Massachusetts, on the same campus as, and in lieu of, the space leased under the original lease.

In June 2022, the Company entered into a two-year noncancelable agreement for dedicated laboratory and office space in Newton, Massachusetts (the “Newton, MA Lease”), which was amended in September 2022.

Pursuant to the amended Newton, MA Lease, the

Company entered into a two-year noncancelable agreement for new dedicated laboratory and office space in Newton, Massachusetts, on the same campus as, and in lieu of, the space leased under the original lease.

The Company took occupancy of the new dedicated laboratory and office space in December 2022.

The amended Newton, MA Lease provides for monthly rental payments, including base rent charges of $ 1.3 million per year, and a month-to-month extension after completion of the initial two-year term extending through November 2024, with base rent calculated on the then-market rate with three months’ prior notice.

The amended Newton, MA Lease provided for monthly rental payments, including base rent charges of $ 1.3 million per year.

In August 2024, the Newton, MA Lease was further amended to extend the lease through November 2025, with an option to further extend the lease for an additional twenty-five months or continue the lease on a month-to-month basis after completion of the term ending in November 2025.

The components of operating lease expense were as follows (in thousands):

For the Three Months

Ended June 30,

Ended September 30,

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

For The Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

For The Nine Months

Ended September 30,

Operating lease cost

3 unchanged sentences

Operating cash flows related to operating leases

Future minimum lease payments under the noncancelable leases as of June 30, 2024 was as follows (in thousands):

Future minimum lease payments under the noncancelable leases as of September 30, 2024 was as follows (in thousands):

Year Ending December 31,

Operating Lease

2024 (excluding the six months ended June 30, 2024)

2024 (excluding the nine months ended September 30, 2024)

Total lease payments

1 unchanged sentence

Present value of operating lease liability

As of June 30, 2024 , the Company’s operating leases were measured using a weighted-average incremental borrowing rate of 6.0 % over a weighted-average remaining lease term of 0.5 years.

As of June 30, 2023 , the Company’s operating leases were measured using a weighted-average incremental borrowing rate of 6.0 % over a weighted-average remaining lease term of 2.2 years.

As of September 30, 2024 , the Company’s operating leases were measured using a weighted-average incremental borrowing rate of 6.0 % over a weighted-average remaining lease term of 1.1 years.

As of September 30, 2023 , the Company’s operating leases were measured using a weighted-average incremental borrowing rate of 6.0 % over a weighted-average remaining lease term of 2.0 years.

The total operating liabilities are presented on the Company’s condensed consolidated balance sheet based on maturity dates.

$ 0.7 million is classified under “ operating lease liabilities, current” for the portion due within twelve months.

There was no operating lease liability classified under “operating lease liabilities, non-current”.

$ 1.4 million is classified under “ operating lease liabilities, current” for the portion due within twelve months, and $ 0.2 million is classified under “operating lease liabilities, non-current”.

License Agreements

4 unchanged sentences

The PHP Work Order was effective for six months from November 2022 and terminated in accordance with its terms in May 2023.

As compensation for the services and deliverables under the PHP Work Order, the Company paid PHP a cash fee of $ 0.5 million per month during the term of the PHP Work Order for an Aggregate Fee of $ 3.0 million.

As compensation for the services and deliverables under the PHP Work Order, the Company recognized research and development expense of $ 0.5 million per month during the term of the PHP Work Order for an Aggregate Fee of $ 3.0 million.

Manufacturing Agreements

1 unchanged sentence

The Commercial Manufacturing Agreement outlines the terms and conditions under which WuXi Biologics manufactures drug substance and drug product for commercial use.

Through June 30, 2024, the Company committed to noncancelable purchase obligations related to commercial drug substance and drug product manufacturing under the Commercial Manufacturing Agreement.

As of June 30, 2024 , the total remaining contractually binding commercial drug substance and drug product purchase obligations due to WuXi Biologics was $ 52.6 million, which is expected to be paid in 2024 and 2025.

As of June 30, 2024 , $ 15.6 million related to the contractually binding commercial drug substance and drug product batches was included in accounts payable and accrued expenses, which is expected to be paid in 2024.

Through June 30, 2024, the Company committed to noncancelable purchase obligations related to the procurement of materials to be used in future drug substance and drug product manufacturing under the Commercial Manufacturing Agreement.

As of June 30, 2024 , the total remaining contractually binding purchase obligations due to WuXi Biologics was $ 24.7 million, which is expected to be paid in 2024 and 2025.

As of June 30, 2024 , $ 6.0 million related to the procurement of materials to be used in future drug substance and drug product manufacturing was included in accounts payable and accrued expenses, which is expected to be paid in 2024.

Through September 30, 2024, the Company committed to noncancelable purchase obligations related to commercial drug substance and drug product manufacturing under the Commercial Manufacturing Agreement.

As of September 30, 2024 , the total remaining contractually binding commercial drug substance and drug product purchase obligations due to WuXi Biologics was $ 38.3 million, which is expected to be paid in 2024 and 2025.

As of September 30, 2024 , $ 36.5 million related to the contractually binding commercial drug substance and drug product batches was included in accounts payable and accrued expenses, which is expected to be paid in 2024 and 2025.

Through September 30, 2024, the Company committed to noncancelable purchase obligations related to the procurement of materials to be used in future drug substance and drug product manufacturing under the Commercial Manufacturing Agreement.

As of September 30, 2024 , the total remaining contractually binding purchase obligations due to WuXi Biologics was $ 17.0 million, which is expected to be paid in 2024 and 2025.

As of September 30, 2024 , $ 10.6 million related to the procurement of materials to be used in future drug substance and drug product manufacturing was included in accounts payable and accrued expenses, which is expected to be paid in 2024 and 2025.

Unless earlier terminated, the Commercial Manufacturing Agreement remains in effect for an initial period of five years from the date of the last amendment and restatement of the agreement and thereafter automatically renews for further successive periods of five years each.

9 unchanged sentences

The actual amounts the Company could pay in the future to the vendors under such agreements may differ from the purchase order amounts due to cancellation provisions.

The termination fees were not probable of payment as of June 30, 2024 and December 31, 2023.

The termination fees were not probable of payment as of September 30, 2024 and December 31, 2023.

Legal Proceedings

8 unchanged sentences

District Court for the District of Massachusetts.

The complaint alleges violations of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder on the basis of purportedly materially false and misleading statements and omissions concerning ADG20’s effectiveness against the Omicron variant of COVID-19.

The complaint seeks, among other things, unspecified damages, attorneys’ fees, expert fees, and other costs.

The complaint alleged violations of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder on the basis of purportedly materially false and misleading statements and omissions concerning ADG20’s effectiveness against the Omicron variant of COVID-19.

The complaint sought, among other things, unspecified damages, attorneys’ fees, expert fees, and other costs.

The court appointed lead plaintiffs for the action on June 28, 2023.

On August 23, 2023, the lead plaintiffs filed an amended complaint that makes allegations similar to those in the original complaint and asserts the same claims against the same defendants as the original complaint.

On October 19, 2023, the parties filed a joint stipulation to advise the court that the lead plaintiffs intended to seek leave to file a second amended complaint, and on November 22, 2023, the lead plaintiffs filed a second amended complaint that makes allegations similar to those in the prior complaints and asserts the same claims against the same defendants as the prior complaints.

On August 23, 2023, the lead plaintiffs filed an amended complaint that made allegations similar to those in the original complaint and asserted the same claims against the same defendants as the original complaint.

On October 19, 2023, the parties filed a joint stipulation to advise the court that the lead plaintiffs intended to seek leave to file a second amended complaint, and on November 22, 2023, the lead plaintiffs filed a second amended complaint that made allegations similar to those in the prior complaints and asserted the same claims against the same defendants as the prior complaints.

On January 12, 2024, the defendants filed a motion to dismiss the second amended complaint in its entirety.

The lead plaintiffs filed an opposition to the motion to dismiss on February 26, 2024, and the defendants filed a reply in further support of their motion to dismiss on March 27, 2024.

The court heard oral arguments on the defendants’ motion to dismiss on May 10, 2024, and took the matter under advisement.

The Company believes that is has strong defenses, and it intends to vigorously defend against this action.

The lawsuit is in early stages, and, at this time, no assessment can be made as to the likely outcome or whether the outcome will be material to the Company.

The court heard oral arguments on the defendants’ motion to dismiss on May 10, 2024.

The court granted the defendants’ motion to dismiss on September 18, 2024, dismissing the second amended complaint in its entirety, with prejudice and without leave to amend.

The plaintiffs did not appeal the court's decision.

As such, the Company has concluded that this matter is closed.

Indemnification Agreements

In the ordinary course of business, the Company may provide indemnification of varying scope and terms to its vendors, lessors, contract research organizations, contract development and manufacturing organizations (“CDMOs”), business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties.

with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties.

In addition, the Company has entered into indemnification agreements with members of its board of directors and its executive officers that require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or executive officers.

2 unchanged sentences

Shares Reserved for Future Issuance

As of June 30, 2024 , the Company had reserved 46,070,885 shares of common stock for the exercise of outstanding stock options and the issuance of awards available for grant under the Company’s 2020 Equity Incentive Plan, 2021 Equity Incentive Plan and 2021 Employee Stock Purchase Plan (see Note 11).

As of September 30, 2024 , the Company had reserved 45,909,485 shares of common stock for the exercise of outstanding stock options and the issuance of awards available for grant under the Company’s 2020 Equity Incentive Plan, 2021 Equity Incentive Plan and 2021 Employee Stock Purchase Plan (see Note 11).

Shelf Registration Statement

1 unchanged sentence

333-267643) and an accompanying base prospectus, which was declared effective by the SEC on October 5, 2022, for the offer and sale of up to $ 400 million of the Company’s securities.

As of June 30, 2024 , $ 325 million of the Company’s securities remained available for offer and sale under this shelf registration statement.

As of September 30, 2024 , $ 325 million of the Company’s securities remained available for offer and sale under this shelf registration statement.

In December 2023, the Company entered into a Controlled Equity Offering SM Sales Agreement (the “Sales Agreement”) with Cant or Fitzgerald & Co., as sales agent (“Cantor”), pursuant to which the Company may, at its option, offer and sell shares of its common stock, with a sales value of up to $ 75.0 million, from time to time, through Cantor, acting as sales agent, in transactions deemed to be “at the market offerings”, as defined in Rule 415 under the Securities Act of 1933, as amended.

1 unchanged sentence

In February 2024, the Company sold 9,000,000 shares of its common stock under the Sales Agreement at an average price of $ 4.50 per share for $ 39.3 million in net proceeds.

As of June 30, 2024 , $ 34.5 million remained available for sale under the Sales Agreement.

As of September 30, 2024 , $ 34.5 million remained available for sale under the Sales Agreement.

Treasury Stock

19 unchanged sentences

The exercise price for stock options granted may not be less than the fair market value of the Company’s common stock on the date of grant, as determined by the board of directors, or at least 110 % of the fair market value of the Company’s common stock on the date of grant in the case of an incentive stock option granted to an employee who owns stock representing more than 10 % of the voting power of all classes of stock as determined by the board of directors as of the date of grant.

Prior to the IPO, the Company’s board of directors determined the fair value of the Company’s common stock, taking into consideration its most recently available valuation of common stock performed by third parties as well as additional factors which may have changed since the date of the most recent contemporaneous valuation through the date of grant.

Prior to the IPO, the Company’s board of directors determined the fair value of the Company’s common stock, taking into consideration its most recently available valuation of

common stock performed by third parties as well as additional factors which may have changed since the date of the most recent contemporaneous valuation through the date of grant.

Stock options granted under the 2020 Plan expire after ten years and typically vest over a four-year period with the first 25 % vesting upon the first anniversary of a specified vesting commencement date and the remainder vesting in 36 equal monthly installments over the succeeding three years , contingent on the recipient’s continued employment or service.

Certain awards of stock options permit the holders to exercise the option in whole or in part prior to the full vesting of the option in exchange for unvested shares of restricted common stock with respect to any unvested portion of the option so exercised.

As of June 30, 2024, there were 3,582,262 shares authorized to be issued upon the exercise of outstanding stock option grants and no shares reserved for future issuance under the 2020 Plan.

As of September 30, 2024, there were 2,985,456 shares authorized to be issued upon the exercise of outstanding stock option grants and no shares reserved for future issuance under the 2020 Plan.

2021 Equity Incentive Plan

8 unchanged sentences

The shares of common stock underlying any awards that are forfeited, cancelled, held back upon exercise or settlement of an award to satisfy the exercise price or tax withholding, repurchased or are otherwise terminated by the Company under the 2021 Plan will be added back to the shares of common stock available for issuance under the 2021 Plan.

As of June 30, 2024 , there were an aggregate of 45,128,836 shares authorized to be issued under the 2020 Plan and the 2021 Plan, which included 3,582,262 and 21,448,387 shares authorized to be issued upon the exercise of outstanding stock option grants from the 2020 Plan and 2021 Plan, respectively, and 0 and 20,098,187 shares reserved for future issuance under the 2020 Plan and 2021 Plan, respectively.

As of September 30, 2024 , there were an aggregate of 45,004,758 shares authorized to be issued under the 2020 Plan and the 2021 Plan, which included 2,985,456 and 18,890,298 shares authorized to be issued upon the exercise of outstanding stock option grants from the 2020 Plan and 2021 Plan, respectively, and 0 and 23,129,004 shares reserved for future issuance under the 2020 Plan and 2021 Plan, respectively.

Stock Option Valuation

8 unchanged sentences

The following table presents, on a weighted-average basis, the assumptions used in the Black-Scholes option-pricing model to determine the grant date fair value of stock options granted:

Three Months Ended June 30,

Six Months Ended

Three Months Ended September 30,

Nine Months Ended

September 30,

Nine Months Ended

September 30,

Expected term (in years)

6 unchanged sentences

Outstanding at December 31, 2023

Outstanding at June 30, 2024

Vested and expected to vest at June 30, 2024

Options exercisable at June 30, 2024

The weighted-average grant date fair value of stock options granted during the three and six months ended June 30, 2024 was $ 1.48 and $ 2.21 , respectively, per share.

The weighted-average grant date fair value of stock options granted during the three and six months ended June 30, 2023 was $ 0.86 and $ 1.18 , respectively, per share.

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair market value of the common stock for the options that had exercise prices lower than the estimated fair value of the Company’s common stock at June 30, 2024 and 2023.

The total intrinsic value of stock options exercised was $ 0.2 million for both the three and six months ended June 30, 2024 .

The total intrinsic value of stock options exercised was $ 0.1 million and $ 0.4 million for the three and six months ended June 30, 2023, respectively.

Outstanding at September 30, 2024

Vested and expected to vest at September 30, 2024

Options exercisable at September 30, 2024

The weighted-average grant date fair value of stock options granted during the three and nine months ended September 30, 2024 was $ 0.74 and $ 2.06 , respectively, per share.

The weighted-average grant date fair value of stock options granted during the three and nine months ended September 30, 2023 was $ 1.06 and $ 1.15 , respectively, per share.

The total intrinsic value of stock options exercised was $ 0.1 million and $ 0.3 million for the three and nine months ended September 30, 2024 , respectively.

The total intrinsic value of stock options exercised was $ 0.1 million and $ 0.5 million for the three and nine months ended September 30, 2023, respectively.

Stock-Based Compensation Expense

The Company recorded stock-based compensation expense (service-based stock options and employee stock purchase plan) in the following expense categories of its condensed consolidated statements of operations and comprehensive loss (in thousands):

Three Months Ended June 30,

Six Months Ended

Three Months Ended September 30,

Nine Months Ended

September 30,

Nine Months Ended

September 30,

Research and development

Selling, general and administrative

As of June 30, 2024, $ 0.6 million of share-based compensation expense was capitalized and recorded as Inventory in the accompanying condensed consolidated balance sheet.

As of September 30, 2024 , $ 0.9 million of share-based compensation expense was capitalized and recorded as Inventory in the accompanying condensed consolidated balance sheet.

In April 2024, David Hering ceased serving as the Company’s Chief Executive Officer and as a member of the Company’s board of directors.

Pursuant to his separation agreement, the Company recognized approximately $ 5.5 million of selling, general, and administrative related stock-based compensation expense associated with the accelerated vesting of a portion of his outstanding stock options, in accordance with the terms of his employment agreement.

As of June 30, 2024 , total unrecognized stock-based compensation expense related to unvested stock-based awards was $ 28.4 million, which is expected to be recognized over a weighted-average period of 2.4 years.

As of September 30, 2024 , total unrecognized stock-based compensation expense related to unvested stock-based awards was $ 21.5 million, which is expected to be recognized over a weighted-average period of 2.3 years.

2021 Employee Stock Purchase Plan

1 unchanged sentence

A total of 1,342,773 shares of common stock were initially reserved for issuance under the 2021 ESPP.

There were 400,724 shares issued under the 2021 ESPP as of June 30, 2024 .

There were 438,046 shares issued under the 2021 ESPP as of September 30, 2024 .

The number of shares of common stock that may be issued under the 2021 ESPP will automatically increase on the first day of each calendar year, pursuant to the evergreen provision thereof, beginning on January 1, 2022 and continuing through January 1, 2031, by an amount equal to the lesser of (i) 1 % of the shares of common stock outstanding on the last day of the calendar month before the date of each automatic increase, (ii) 2,685,546 shares and (iii) an amount determined by the Company’s board of directors.

1 unchanged sentence

The first offering under the 2021 ESPP was June 6, 2022.

As of June 30, 2024 , 942,049 shares remained available for issuance under the 2021 ESPP.

During both the three and six months ended June 30, 2024 , the Company recognized less than $ 0.1 million in related

stock-based compensation expense.

During both the three and six months ended June 30, 2023 , the Company recognized less than $ 0.1 million in related stock-based compensation expense.

As of September 30, 2024 , 904,727 shares remained available for issuance under the 2021 ESPP.

During both the three and nine months ended September 30, 2024 , the Company recognized less than $ 0.1 million

in related stock-based compensation expense.

During both the three and nine months ended September 30, 2023 , the Company recognized less than $ 0.1 million in related stock-based compensation expense.

Warrant Expense

5 unchanged sentences

The aggregate grant date fair value of the PHP Warrant was $ 17.4 million, which was recognized as warrant expense on the grant date in November 2022.

There were no warrants issued during the three and six months ended June 30, 2024.

As of June 30, 2024 , there were 6,824,712 warrants outstanding at a weighted-average exercise price of $ 3.48 , with a weighted-average remaining contractual term of 8.38 years.

For the three and six months ended June 30, 2024 and 2023, the Company recorded no income tax benefits for the net operating losses incurred or for the research and development tax credits generated in each period, due to its uncertainty of realizing a benefit from those items.

There were no warrants issued during the three and nine months ended September 30, 2024 and 2023.

As of September 30, 2024 , there were 6,824,712 warrants outstanding and not yet vested at a weighted-average exercise price of $ 3.48 , with a weighted-average remaining contractual term of 8.13 years.

For the three and nine months ended September 30, 2024 and 2023 , the Company recorded no income tax benefits for the net operating losses incurred or for the research and development tax credits generated in each period, due to its uncertainty of realizing a benefit from those items.

Substantially all of the Company’s operating losses since inception have been generated in the U.S.

3 unchanged sentences

Pursuant to the terms of the 401(k) Plan, the Company is required to make non-elective contributions of 3 % of eligible participants’ compensation.

For the three and six months ended June 30, 2024 and 2023 , the Company contributed $ 0.1 million and $ 0.3 million, respectively, to the 401(k) Plan.

For the three and nine months ended September 30, 2024 , the Company contributed $ 0.2 million and $ 0.5 million, respectively, to the 401(k) Plan.

For the three and nine months ended September 30, 2023 , the Company contributed $ 0.3 million and $ 0.6 million, respectively, to the 401(k) Plan.

Net Loss per Share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share amounts):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Net loss attributable to common stockholders

1 unchanged sentence

Net loss per share attributable to common stockholders, basic and diluted

Shares of unvested restricted common stock are not considered outstanding for accounting purposes until vested and were excluded from the calculations of basic net loss per share attributable to common stockholders for the three and six months ended June 30, 2023.

There were no shares of unvested restricted common stock for the three and six months ended June 30, 2024.

There were no shares of unvested restricted common stock for the three and nine months ended September 30, 2024.

The Company’s potential dilutive securities have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share.

Therefore, the weighted-average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same.

The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated, because including them would have had an anti-dilutive effect:

For the Six Months

Ended June 30,

For the Six Months

Ended June 30,

The Company excluded the following potential

common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated, because including them would have had an anti-dilutive effect:

For the Three and Nine Months

Ended September 30,

For the Three and Nine Months

Ended September 30,

Stock options to purchase common stock

2 unchanged sentences

Related-Party Transactions

As of both June 30, 2024 and December 31, 2023 , an aggregate of $ 0.7 million was due to Adimab under the Adimab Assignment Agreement, the Adimab Collaboration Agreement, the Adimab Platform Transfer Agreement and the Adimab DNA Sequencing Services Agreement (as defined below) by the Company.

As of June 30, 2024 and December 31, 2023 , no amounts were due to the Company from Adimab under the Adimab Assignment Agreement, the Adimab Collaboration Agreement, the Adimab Platform Transfer Agreement or the Adimab DNA Sequencing Services Agreement.

As of September 30, 2024 and December 31, 2023 , an aggregate of $ 1.3 million and $ 0.7 million, respectively, was due to Adimab under the Adimab Assignment Agreement, the Adimab Collaboration Agreement, the Adimab Platform Transfer Agreement and the Adimab DNA Sequencing Services Agreement (as defined below) by the Company and was included in accrued expenses.

As of September 30, 2024 and December 31, 2023 , no amounts were due to the Company from Adimab under the Adimab Assignment Agreement, the Adimab Collaboration Agreement, the Adimab Platform Transfer Agreement or the Adimab DNA Sequencing Services Agreement.

Adimab Assignment Agreement

Under the Adimab Assignment Agreement, Adimab, a principal stockholder of the Company, is entitled to receive milestone and royalty payments upon specified conditions and receives payments from the Company for providing ongoing services under the agreement (see Note 7).

During both the three and six months ended June 30, 2024, the Company did no t recognize any IPR&D expense with respect to contingent consideration payable under the Adimab Assignment Agreement.

During the three and six months ended June 30, 2023 , the Company recognized $ 0 and $ 0.4 million, respectively, as IPR&D expense with respect to a milestone payable under the Adimab Assignment Agreement.

During both the three and nine months ended September 30, 2024, the Company did no t recognize any IPR&D expense with respect to contingent consideration payable under the Adimab Assignment Agreement.

During the three and nine months ended September 30, 2023 , the Company recognized $ 3.2 million and $ 3.6 million, respectively, as IPR&D expense with respect to a milestone payable under the Adimab Assignment Agreement.

During both the three and nine months ended September 30, 2024, the Company expensed $ 0.5 million of royalties as costs of product revenue and reserves all rights under the Adimab Assignment Agreement and the applicable law.

During both the three and nine months ended September 30, 2023 , the Company did no t recognize any costs of product revenue with respect to royalties under the Adimab Assignment Agreement.

Adimab Collaboration Agreement

Under the Adimab Collaboration Agreement, the Company is obligated to pay Adimab for certain fees, milestones and royalty payments (see Note 7).

During the three and six months ended June 30, 2024 , the Company recognized $ 0.6 million and $ 1.2 million, respectively, of research and development expense related to the quarterly fee under the Adimab Collaboration Agreement.

During the three and six months ended June 30, 2023 , the Company recognized $ 1.3 million and $ 2.6 million, respectively, of research and development expense related to the quarterly fee under the Adimab Collaboration Agreement.

During both the three and six months ended June 30, 2024 , the Company did no t recognize any research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab Collaboration Agreement.

During the three and nine months ended September 30, 2024 , the Company recognized $ 0.6 million and $ 1.8 million, respectively, of research and development expense related to the quarterly fee under the Adimab Collaboration Agreement.

During the three and nine months ended September 30, 2023 , the Company recognized $ 1.3 million and $ 3.9 million, respectively, of research and development expense related to the quarterly fee under the Adimab Collaboration Agreement.

During both the three and nine months ended September 30, 2024 , the Company did no t recognize any research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab Collaboration Agreement.

During both the three and nine months ended September 30, 2024 , the Company did no t recognize any IPR&D expense related to an option fee.

During both the three and nine months ended September 30, 2023 , the Company recognized $ 1.0 million of IPR&D expense related to an option exercise fee.

During both the three and nine months ended September 30, 2024 , the Company did no t recognize any IPR&D expense related to a drug delivery fee or optimization fee.

During both the three and nine months ended September 30, 2023 , the Company recognized $ 0.2 million of IPR&D expense related to a drug delivery fee and $0.2 million of IPR&D expense related to an optimization completion fee.

Adimab Platform Transfer Agreement

Under the Adimab Platform Transfer Agreement, the Company is obligated to pay Adimab for certain fees, milestones and royalty payments (see Note 7).

During the three and six months ended June 30, 2024, the Company recognized a portion of the first annual fee as research and development expense under the Adimab Platform Transfer Agreement.

During both the three and six months ended June 30, 2023, the Company did not recognize any research and development expense under the Adimab Platform Transfer Agreement.

Under the Adimab Platform Transfer Agreement, the Company is obligated to pay Adimab for certain fees, milestones and royalty payments (see Note 7), including an annual fee of single digit millions on each of the first four anniversaries of the Adimab Platform Transfer Agreement Effective Date.

During both the three and nine months ended September 30, 2024 and 2023, the Company recognized a portion of the annual fee as research and development expense under the Adimab Platform Transfer Agreement.

Adimab DNA Sequencing Services Agreement

1 unchanged sentence

In exchange for the services performed, the Company will pay Adimab a fee for each yeast-derived DNA template sample present in the well within the sequencer plate.

During both the three and six months ended June 30, 2024 , the Company recognized less than $ 0.1 million of research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab DNA Sequencing Services Agreement.

During both the three and six months ended June 30, 2023 , the Company recognized less than $ 0.1 million of research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab DNA Sequencing Services Agreement

During both the three and nine months ended September 30, 2024 , the Company recognized less than $ 0.1 million of research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab DNA Sequencing Services Agreement.

During both the three and nine months ended September 30, 2023 , the Company recognized less than $ 0.1 million of research and development expense with respect to services performed by Adimab on the Company’s behalf under the Adimab DNA Sequencing Services Agreement

Population Health Partners, L.P.

1 unchanged sentence

Tamsin Berry, a member of the Company’s board of directors, is a Limited Partner of PHP.

During the three and six months ended June 30, 2024 , the Company did no t recognize any research and development expense related to the cash compensation paid to PHP.

During the three and six months ended June 30, 2023 , the Company recognized $ 0.8 million and $ 2.3 million, respectively, of research and development expense related to services performed by PHP in connection with the PHP Work Order, which terminated in accordance with its terms in May 2023.

As of June 30, 2024 , no amounts were due to PHP by the Company, and no amounts were due from PHP to the Company.

During the three and nine months ended September 30, 2024 , the Company did no t recognize any research and development expense related to the cash compensation paid to PHP.

During the three and nine months ended September 30, 2023 , the Company recognized $ 0 and $ 2.3 million, respectively, of research and development expense related to services performed by PHP in connection with the PHP Work Order, which terminated in accordance with its terms in May 2023.

As of September 30, 2024 , no amounts were due to PHP by the Company, and no amounts were due from PHP to the Company.

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