What changed in this filing

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Item 1. Financial Statements

2024-11-06 compared with 2024-08-07 · 114 added, 103 removed, 517 unchanged (30% of the section changed)

3 unchanged sentences

(in thousands, except share and par value data)

September 30,

Current assets:

Cash and cash equivalents

Accounts receivable

Short-term investments

18 unchanged sentences

authorized shares – 10,000,000 at

June 30, 2024 and December 31, 2023, respectively;

September 30, 2024 and December 31, 2023, respectively;

no shares issued

and outstanding at June 30, 2024 and December 31, 2023

and outstanding at September 30, 2024 and December 31, 2023

Common stock, $ 0.001 par value;

authorized shares – 200,000,000 at

June 30, 2024 and December 31, 2023, respectively;

September 30, 2024 and December 31, 2023, respectively;

issued shares – 52,338,762

and 46,262,759 at June 30, 2024 and December 31, 2023, respectively;

shares – 52,162,215 and 46,252,440 at June 30, 2024 and December 31, 2023,

and 46,262,759 at September 30, 2024 and December 31, 2023, respectively;

shares – 52,337,239 and 46,252,440 at September 30, 2024 and December 31, 2023,

Additional paid-in capital

Accumulated other comprehensive income (loss)

Accumulated other comprehensive income

Accumulated deficit

6 unchanged sentences

Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Collaboration revenue

16 unchanged sentences

Unaudited Condensed Statements of Stockholders’ Equity

For the Six Months Ended June 30, 2024 and 2023

For the Nine Months Ended September 30, 2024 and 2023

(in thousands, except share data)

1 unchanged sentence

Stockholders’

Income (Loss)

Balance at December 31, 2023

1 unchanged sentence

Exercise of common stock options

Issuance of common stock upon vesting of restricted stock units

Shares issued under employee stock purchase plan

1 unchanged sentence

Stock-based compensation

Unrealized loss on available-for-sale securities, net

Balance at June 30, 2024

Unrealized gain on available-for-sale securities, net

Balance at September 30, 2024

Comprehensive

1 unchanged sentence

Balance at December 31, 2022

Issuance of common stock and pre-funded common stock warrants, net of issuance costs

Exercise of pre-funded common stock warrants

Exercise of common stock options

3 unchanged sentences

Unrealized gain on available-for-sale securities, net

Balance at June 30, 2023

Balance at September 30, 2023

See accompanying notes.

1 unchanged sentence

Unaudited Condensed Statements of Stockholders’ Equity

For the Three Months Ended June 30, 2024 and 2023

For the Three Months Ended September 30, 2024 and 2023

(in thousands, except share data)

1 unchanged sentence

Stockholders’

Balance at March 31, 2024

Issuance costs

Income (Loss)

Balance at June 30, 2024

Exercise of common stock options

Shares issued under employee stock purchase plan

Issuance of common stock upon vesting of restricted stock units

Vesting of restricted shares

Stock-based compensation

Unrealized loss on available-for-sale securities, net

Balance at June 30, 2024

Unrealized gain on available-for-sale securities, net

Balance at September 30, 2024

Comprehensive

Stockholders’

Balance at March 31, 2023

Shares issued under employee stock purchase plan

Balance at June 30, 2023

Issuance of common stock and pre-funded common stock warrants, net of issuance costs

Exercise of pre-funded common stock warrants

Exercise of common stock options

Vesting of restricted shares

1 unchanged sentence

Unrealized loss on available-for-sale securities, net

Balance at June 30, 2023

Balance at September 30, 2023

See accompanying notes.

2 unchanged sentences

(in thousands)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities

3 unchanged sentences

Changes in operating assets and liabilities:

Accounts receivable

Prepaid expenses and other current assets

9 unchanged sentences

Maturities of short-term investments

Net cash provided by (used in) investing activities

Net cash used in investing activities

Cash flows from financing activities

2 unchanged sentences

Net cash provided by financing activities

Net decrease in cash, cash equivalents and restricted cash

Net increase (decrease) in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash – beginning of year

3 unchanged sentences

Vesting of restricted common stock

Unrealized gain (loss) on available-for-sale securities, net

Unrealized gain on available-for-sale securities, net

See accompanying notes.

6 unchanged sentences

Liquidity and Capital Resources

From its inception through June 30, 2024, the Company has devoted substantially all its efforts to organizing and staffing, business planning, raising capital and developing its TRACTr and TRACIr therapeutic platforms and assets.

The Company has incurred net losses and negative cash flows from operations since inception and had an accumulated deficit of $ 189.5 million as of June 30, 2024.

From its inception through September 30, 2024, the Company has devoted substantially all its efforts to organizing and staffing, business planning, raising capital and developing its TRACTr and TRACIr therapeutic platforms and assets.

The Company has incurred net losses and negative cash flows from operations since inception and had an accumulated deficit of $ 217.5 million as of September 30, 2024.

The Company has a limited operating history, has not generated any product revenue, and the sales and income potential of its business is unproven.

4 unchanged sentences

Any of these actions could materially harm the Company’s business, results of operations and future prospects.

There can be no assurance that such financing will be available or will be at terms acceptable to the Company, especially in light of public health crises, current financial conditions within the banking industry, including the effects of recent failures of financial institutions and liquidity levels, as well as recent or anticipated changes in interest rates and the inflationary macro environment.

Management believes the Company has sufficient capital to fund its operation for at least 12 months from the issuance date of these unaudited condensed financial statements.

There can be no assurance that such financing will be available or will be at terms acceptable to the Company, especially in light of public health crises, financial conditions within the banking industry, including the effects of failures of financial institutions and liquidity levels, as well as changes in interest rates and the inflationary macro environment.

Management believes the Company has sufficient capital to fund its operations for at least 12 months from the issuance date of these unaudited condensed financial statements.

Unaudited Interim Financial Information

The unaudited condensed financial statements as of June 30, 2024, and for the three and six months ended June 30, 2024 and 2023, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), and with accounting principles generally accepted in the United States (“GAAP”) applicable to interim financial statements.

The unaudited condensed financial statements as of September 30, 2024, and for the three and nine months ended September 30, 2024 and 2023, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), and with accounting principles generally accepted in the United States (“GAAP”) applicable to interim financial statements.

These unaudited condensed financial statements have been prepared on the same basis as the Company’s audited financial statements and include all adjustments, consisting of only normal recurring accruals, which in the opinion of management are necessary to present fairly the Company’s financial position as of the interim date and results of operations for the interim periods presented.

8 unchanged sentences

Actual results may differ materially and adversely from these estimates.

Fair Value Measurements

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

Fair Value Measurements

The accounting guidance defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or non-recurring basis.

20 unchanged sentences

Observable Inputs

As of June 30, 2024:

As of September 30, 2024:

Cash equivalents:

3 unchanged sentences

Treasury securities

Asset-backed securities

Corporate debt securities

34 unchanged sentences

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the accompanying balance sheets that sum to the amounts shown in the condensed statements of cash flows (in thousands):

September 30,

Cash and cash equivalents

15 unchanged sentences

The following tables summarize short-term investments (in thousands):

As of June 30, 2024

As of September 30, 2024

Treasury securities

Asset-backed securities

Corporate debt securities

5 unchanged sentences

Commercial paper

The amortized cost and estimated fair value in the tables above excl ude $ 4.6 million and $ 2.2 million of accrued interest receivable as of June 30, 2024 and December 31, 2023, respectively.

The amortized cost and estimated fair value in the tables above e xclude $ 4.5 million and $ 2.2 million of accrued interest receivable as of September 30, 2024 and December 31, 2023, respectively.

Accrued interest receivable is included in prepaid expenses and other current assets in the accompanying balance sheets.

Contractual maturities of available-for-sale debt securities are as follows (in thousands):

As of June 30, 2024

As of September 30, 2024

Due in 1 Year or Less

1 unchanged sentence

Treasury securities

Asset-backed securities

Corporate debt securities

7 unchanged sentences

Commercial paper

As of June 30, 2024 , 49 out of 69 of our a vailable-for-sale debt securities were in an aggregate gross unrealized loss position.

The Company relies on both qualitative and quantitative factors to determine whether the unrealized loss for each available-for-sale debt

As of September 30, 2024 , 3 out of 67 of our a vailable-for-sale debt securities were in an aggregate gross unrealized loss position.

The Company relies on both qualitative and quantitative factors to determine whether the unrealized loss for each available-for-sale debt security at any balance sheet date is due to a credit loss.

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

security at any balance sheet date is due to a credit loss.

Qualitative factors may include a credit downgrade, severity of the decline in fair value below amortized cost and other adverse conditions related specifically to the security, as well as the intent to sell the security, or whether the Company will “more likely than not” be required to sell the security before recovery of its amortized cost basis.

the security, or whether the Company will “more likely than not” be required to sell the security before recovery of its amortized cost basis.

The Company considers the decline in market value for the securities to be primarily attributable to current economic conditions and interest rate adjustments, rather than credit-related factors and does not intend to sell any securities prior to maturity.

No allowance for credit losses has been recorded as of June 30, 2024 or December 31, 2023.

No allowance for credit losses has been recorded as of September 30, 2024 or December 31, 2023.

The following tables summarize our available-for-sale debt securities in an aggregate gross unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

As of June 30, 2024

As of September 30, 2024

Less Than 12 Months

12 Months or Longer

Treasury securities

Asset-backed securities

Corporate debt securities

Commercial paper

14 unchanged sentences

The Company generally does not perform evaluations of customers’ financial condition and generally does not require collateral.

As of June 30, 2024, and December 31, 2023, all of the Company’s accounts receivable, if any, relate to a single customer.

For the three and six months ended June 30, 2024 and 2023, all of the Company’s revenue related to a single customer.

As of September 30, 2024, and December 31, 2023, all of the Company’s accounts receivable, if any, relate to a single customer.

For the three and nine months ended September 30, 2024 and 2023, all of the Company’s revenue related to a single customer.

The Company determines if a contract contains a lease at the inception of the contract and evaluates each lease agreement to determine whether the lease is an operating or finance lease.

For leases where the Company is the lessee, right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent an obligation to make lease

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

payments arising from the lease.

Liabilities from operating leases are included in current portion of operating lease liabilities, and operating lease liabilities, net of current portion on the accompanying balance sheets.

4 unchanged sentences

To determine the present value, the implicit rate is used when readily determinable.

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

For those leases where the implicit rate is not provided, the Company determines an incremental borrowing rate (“IBR”) based on the information available at the lease commencement date in determining the present value of lease payments.

25 unchanged sentences

(i) the expected value method, which is the sum of probability-weighted amounts in a range of possible consideration amounts, and (ii) the mostly likely amount method, which identifies the single most likely amount in a range of possible consideration amounts.

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

With respect to variable consideration relating to development and regulatory milestone payments, if it is probable that a significant revenue reversal would not occur, the associated payment value is included in the transaction price.

2 unchanged sentences

Any such adjustments are recorded on a cumulative catch-up basis, which would affect the reported amount of revenues in the period of adjustment.

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

For arrangements that include sales-based royalties, including milestone payments based on a level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied).

23 unchanged sentences

Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding for the period, including pre-funded common stock warrants that were issued in underwritten offerings (Note 4), without consideration for potentially dilutive securities.

The pre-funded common stock warrants are included in the calculation of basic and

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

diluted net loss per share as the exercise price of $ 0.001 per share is non-substantive and the shares are issuable for little or no consideration.

The Company has excluded weighted-average unvested shares of 3,970 shares, 26,987 shares, 5,995 shares and 38,160 shares from the weighted-average number of shares of common stock outstanding for the three months ended June 30, 2024 and 2023 and six months ended June 30, 2024 and 2023, respectively.

The pre-funded common stock warrants are included in the calculation of basic and diluted net loss per share as the exercise price of $ 0.001 per share is non-substantive and the shares are issuable for little or no consideration.

The Company has excluded weighted-average unvested shares of 1,895 shares, 20,274 shares, 4,618 shares and 32,132 shares from the weighted-average number of shares of common stock outstanding for the three months ended September 30, 2024 and 2023 and nine months ended September 30, 2024 and 2023, respectively.

Diluted net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock and dilutive common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods.

For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding as inclusion of the potentially dilutive securities would be anti-dilutive.

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

Potentially dilutive securities not included in the calculation of diluted net loss per share, because to do so would be anti-dilutive, are as follows (in common stock equivalent shares):

September 30,

Common stock options outstanding

22 unchanged sentences

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

September 30,

Interest receivable

5 unchanged sentences

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

September 30,

Laboratory equipment

6 unchanged sentences

Accrued expenses consist of the following (in thousands):

September 30,

Accrued research and development

22 unchanged sentences

The letter of credit amount is subject to a 50 % reduction subject to certain conditions on or following the date that is 54 months following the contractual lease commencement date.

Future minimum noncancelable operating lease payments as of June 30, 2024 are as follows (in thousands):

Future minimum noncancelable operating lease payments as of September 30, 2024 are as follows (in thousands):

2024 (remaining)

4 unchanged sentences

Operating lease liabilities, net of current portion

The Torrey Plaza lease has a remaining lease term of 8.6 years and a discount rate of 8 % as of June 30, 2024.

Operating lease expense included in the measurement of lease liabilities for the three and six months ended June 30, 2024 was $ 0.9 million and $ 1.7 million, respectively.

Cash paid for amounts included in the measurement of lease liabilities for the three and six months ended June 30, 2024 was $ 0.8 million and $ 1.7 million, respectively.

Operating lease expense included in the measurement of lease liabilities for the three and six months ended June 30, 2023 was $ 0.9 million and $ 1.7 million, respectively.

Cash paid for amounts included in the measurement of lease liabilities for the three and six months ended June 30, 2023 was $ 0.8 million and $ 1.1 million, respectively.

The Torrey Plaza lease has a remaining lease term of 8.3 years and a discount rate of 8 % as of September 30, 2024.

Operating lease expense included in the measurement of lease liabilities for the three and nine months ended September 30, 2024 was $ 0.9 million and $ 2.6 million, respectively.

Cash paid for amounts included in the measurement of lease liabilities for the three and nine months ended September 30, 2024 wa s $ 0.9 million and $ 2.5 million, re spectively.

Operating lease expense included in the measurement of lease liabilities for the three and nine months ended September 30, 2023 was $ 0.9 million and $ 2.6 million, respectively.

Cash paid for amounts included in the measurement of lease liabilities for the three and nine months ended September 30, 2023 was $ 0.8 million and $ 1.9 million, respectively.

Contingencies

1 unchanged sentence

The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated.

As of June 30, 2024, the Company is not currently party to any material le gal proceedings.

As of September 30, 2024, the Company is not currently party to any material le gal proceedings.

Stockholders’ Equity

4 unchanged sentences

In May 2024 , the Company filed a shelf registration statement on Form S-3 which included a new prospectus which covers the offering, issuance and sale of up to a maximum aggregate offering price of $ 150.0 million of the Company’s common under the Sale Agreement .

There was no activity from the Sale Agreement during the three and six months ended June 30, 2024.

As of June 30, 2024 , $ 150.0 million of common stock remained available for sale under the Sale Agreement.

There was no activity from the Sale Agreement during the three and nine months ended September 30, 2024.

As of September 30, 2024 , $ 150.0 million of common stock remained available for sale under the Sale Agreement.

In July 2023, the Company closed an underwritten offering of 4,153,717 shares of its common stock and pre-funded warrants to purchase 583,483 shares of common stock at an exercise price of $ 0.001 per share.

28 unchanged sentences

In addition, the number of shares of common stock available for issuance under the 2021 Plan automatically increases on January 1 of each calendar year through January 1, 2031, in an amount equal to 5 % of the total number of shares of the Company’s common stock on the last day of the calendar month before the date of each automatic increase, or a lesser number of shares determined by the Company’s board of directors.

As of June 30, 2024 , there were 11,290,779 shar es authorized for issuance under the 2021 Plan, inclusive of shares added from 2017 Plan cancellations.

As of September 30, 2024 , there were 11,231,951 shar es authorized for issuance under the 2021 Plan, inclusive of shares added from 2017 Plan cancellations.

Janux Therapeutics, Inc.

7 unchanged sentences

Forfeited or cancelled

Outstanding at June 30, 2024

Vested and expected to vest at June 30, 2024

Exercisable at June 30, 2024

The weighted-average grant date fair value per share of option grants for the six months ended June 30, 2024 and 2023 was $ 9.14 and $ 10.09 , respectively.

The total intrinsic value of stock options exercised for the six months ended June 30, 2024 and 2023 was $ 15.8 million and $ 1.5 million, respectively.

As of June 30, 2024 , total unrecognized stock-based compensation cost associated with option grants was $ 42.6 million, which is expected to be recognized over a remaining weighted-average period of approximately 2.4 years.

Outstanding at September 30, 2024

Vested and expected to vest at September 30, 2024

Exercisable at September 30, 2024

The weighted-average grant date fair value per share of option grants for the nine months ended September 30, 2024 and 2023 was $ 10.86 and $ 10.09 , respectively.

The total intrinsic value of stock options exercised for the nine months ended September 30, 2024 and 2023 was $ 22.1 million and $ 1.9 million, respectively.

As of September 30, 2024 , total unrecognized stock-based compensation cost associated with option grants was $ 39.1 million, which is expected to be recognized over a remaining weighted-average period of approximately 2.3 years.

The assumptions used in the Black-Scholes option pricing model to determine the fair value of stock option grants under the Plans were as follows:

Six Months Ended June 30,

Nine Months Ended September 30,

Risk-free interest rate

9 unchanged sentences

Expected volatility.

Given the Company’s limited historical stock price volatility data, the expected volatility assumption is based on volatilities of a peer group of similar companies whose share prices are publicly available, including the Company’s historical volatility, weighted by years of available trading data within the expected term.

For options granted in the initial years following the Company’s IPO, given the Company’s limited historical stock price volatility data, the expected volatility assumption is based on volatilities of a peer group of similar companies whose share prices are publicly available, including the Company’s historical volatility, weighted by years of available trading data within the expected term.

The peer group was developed based on companies in the biotechnology industry.

The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available.

As sufficient historical data is now available for the Company’s stock price, the Company is currently applying and will continue to apply the volatility of its own stock price in determining volatility.

Expected term .

The expected term represents the period of time that options are expected to be outstanding.

Because the Company does not have sufficient historical exercise behavior to provide a reasonable basis upon which to estimate the expected term, it determines the expected life assumption using the simplified method, for employees, which is an average of the contractual term of the option and its vesting period.

Because the Company does not have sufficient historical exercise behavior to provide a reasonable basis upon which to estimate the expected term, it determines the expected life assumption using the simplified method, for employees and nonemployee directors, which is an average of the contractual term of the option and its vesting period.

The expected term for nonemployee options is generally the contractual term.

9 unchanged sentences

Forfeited or cancelled

Outstanding at June 30, 2024

Outstanding at September 30, 2024

RSU awards are share awards that, upon vesting, will deliver to the holder shares of the Company’s common stock.

The grant-date fair value is recognized as compensation expense over the vesting period.

As of June 30, 2024 , total unrecognized stock-based compensation cost associated with RSUs was $ 0.7 million, which is expected to be recognized over a remaining weighted-average period of approximately 1.0 year.

As of September 30, 2024, total unrecognized stock-based compensation cost associated wit h RSUs was $ 3.3 million, which is expected to be recognized over a remaining weighted-average period of approximately 3.1 years.

2021 Employee Stock Purchase Plan

4 unchanged sentences

provided that before the date of any such increase, the Company’s board of directors may determine that such increase will be less than the amount set forth in clauses (i ) and (ii).

For the three and six months ended June 30, 2024 , stock-based compensation expense related to the ESPP was $ 0.3 million and $ 0.4 million, respectively.

Stock-based compensation expense related to the ESPP for the three and six months ended June 30, 2023 was $ 0.4 million and $ 0.6 million, respectively.

As of June 30, 2024 , total unrecognized stock-based compensation expense related to the ESPP was $ 0.6 million, which is expected to be recognized over a remaining weighted-average period of approximately 1.5 years.

For the three and nine months ended September 30, 2024 , stock-based compensation expense related to the ESPP was $ 0.1 million and $ 0.6 million, respectively.

Stock-based compensation expense related to the ESPP for the three and nine months ended September 30, 2023 was $ 0.2 million and $ 0.7 million, respectively.

As of September 30, 2024 , total unrecognized stock-based compensation expense related to the ESPP was $ 0.5 million, which is expected to be recognized over a remaining weighted-average period of approximately 1.2 years.

Stock-Based Compensation Expense

1 unchanged sentence

Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Research and development

General and administrative

Modification of equity awards

In July 2024, and in connection with the resignation of a former director, the board of directors approved the following modifications to the terms of the former director’s outstanding equity awards:

(a) acceleration of the vesting of all unvested stock options and awards in full, effective as of the former director's resignation date;

and (b) extension of the post-termination exercise period for outstanding options until the earlier of the third anniversary of such resignation date or the original expiration date of such options, subject to the Company’s ability to take any actions permitted under the 2021 Plan.

The incremental stock-based compensation expense resulting from these modifications recognized during the three and nine months ended September 30, 2024 was $ 0.7 million.

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

In August 2024, and in connection with the resignation of a former executive officer, the compensation committee of the board of directors approved the following modifications to the terms of the former officer’s outstanding equity awards as defined within a transition and consulting agreement with the former officer (the “Transition Agreement”):

(a) acceleration of the vesting of unvested stock options such that the number of options that would have vested through June 30, 2026, are vested and exercisable, with such acceleration deemed effective as of December 31, 2024, subject to service conditions described within the Transition Agreement;

and (b) extension of the post-termination exercise period for outstanding options until the earlier of December 31, 2027 or the original expiration date of such options, subject to the Company’s ability to take any actions permitted under the Plans, as applicable.

The incremental stock-based compensation expense resulting from these modifications recognized during the three and nine months ended September 30, 2024 was $ 8.7 million.

Unvested Stock Liabilities

4 unchanged sentences

Vested shares

Balance at June 30, 2024

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

Balance at September 30, 2024

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance consists of the following:

September 30,

Common stock options outstanding

8 unchanged sentences

Merck selected the First Collaboration Target upon execution of the Merck Agreement and selected the Second Collaboration Target in May 2022.

Following the research term, Merck will have the sole right to research, develop, manufacture, and commercialize the licensed compounds and products directed against the Collaboration Targets.

Following the research term, Merck has the sole right to research, develop, manufacture, and commercialize the licensed compounds and products directed against the Collaboration Targets.

Consideration in the Merck Agreement consists of (i) an $ 8.0 million non-refundable and non-creditable upfront fee, (ii) $ 8.0 million paid upon the selection of the Second Collaboration Target, (iii) research program funding (iv) development and regulatory milestones, (v) commercial milestones, and (vi) royalty payments.

2 unchanged sentences

The Merck Agreement provides that Merck is obligated to pay to the Company tiered royalty payments on a product-by-product and country-by-country basis, ranging from low single-digit to low teens percentage royalty rates on specified portions of annual net sales for licensed products under either of the Collaboration Targets that are commercialized.

Such royalties are subject to reduction, on a product-by-product and country-by-country basis, for licensed products not covered by patent claims, or that require Merck to obtain a license to obtain a license to third-party intellectual property in order to commercialize the licensed products, or that are subject to compulsory licensing.

Such royalties are subject to reduction, on a product-by-product and country-by-country basis, for licensed products not covered by patent claims, or that require Merck to obtain a

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

license to obtain a license to third-party intellectual property in order to commercialize the licensed products, or that are subject to compulsory licensing.

The Merck Agreement will terminate at the end of the calendar year in which the expiration of all royalty obligations occurs for all licensed products under the agreement.

3 unchanged sentences

In June 2024, a developmental milestone of $ 7.5 million related to the First Collaboration Target was achieved, at which time the Company recognized the associated revenue.

All other future potential milestone payments are considered constrained as of June 30, 2024 as they are uncertain in nature and highly dependent on factors outside of the Company’s control until the underlying events occur or the associated approvals are received.

The Company recognized $ 8.9 million, $ 1.1 million, $ 10.1 million, and $ 3.1 million of revenue under the Merck Agreement for the three months ended June 30, 2024 and 2023 and six months ended June 30, 2024 and 2023, respectively.

As of June 30, 2024 , aggregate deferred revenue related to the Merck Agreement was $ 0.1 million, all of which was classified as current.

The Company had $ 7.5 million and $ 0 of accounts receivable outstanding as of June 30, 2024 and December 31, 2023, respectively.

The remaining performance obligations under the Merck Agreement relate to the Company’s conduct of research services and the Company’s

Janux Therapeutics, Inc.

Notes to Unaudited Condensed Financial Statements–(Continued)

participation in a joint research committee for the Second Collaboration Target.

The performance obligations related to the First Collaboration Target were completed as of June 30, 2024 .

As it relates to the Second Collaboration Target, the Company estimates the remaining term of the research services, over which revenue will be recognized, to be 0.2 years as of June 30, 2024 .

All other future potential milestone payments are considered constrained as of September 30, 2024 as they are uncertain in nature and highly dependent on factors outside of the Company’s control until the underlying events occur or the associated approvals are received.

The Company recognized $ 0.4 million, $ 2.5 million, $ 10.6 m illion, and $ 5.6 million of revenue under the Merck Agreement for the three months ended September 30, 2024 and 2023 and nine months ended September 30, 2024 and 2023, respectively.

The Company's performance obligations related to the Collaboration Targets were completed as of September 30, 2024 .

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