What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2025-02-28 compared with 2024-02-27 · 127 added, 152 removed, 169 unchanged (62% of the section changed)

9 unchanged sentences

We are a clinical-stage biopharmaceutical company committed to realizing the promise of precision medicines for the treatment of cancer.

Our pipeline consists of small molecule product candidates that target cancer signaling pathways where there is a strong scientific and clinical rationale to improve outcomes, and we intend to pair them with molecular or cellular diagnostics to identify those patients most likely to respond to treatment.

We are conducting clinical trials of three product candidates:

ziftomenib, tipifarnib and KO-2806.

Our pipeline consists of small molecule product candidates that target cancer signaling pathways where there is a strong scientific and clinical rationale to improve outcomes and, in general, we intend to pair our product candidates with molecular or cellular diagnostics to identify those patients most likely to respond to treatment.

Our lead product candidate is ziftomenib, a selective investigational inhibitor of the menin-KMT2A protein-protein interaction.

We are developing ziftomenib for the treatment of genetically defined subsets of acute leukemias, including AML and ALL.

In November 2024, we entered into a collaboration and license agreement with Kyowa Kirin to develop and commercialize ziftomenib for the treatment of patients with AML and other hematologic malignancies, which may be expanded into other indications at the option of Kyowa Kirin, subject to certain conditions.

We also are exploring the use of ziftomenib for the treatment of GIST and ziftomenib and our next-generation menin inhibitors for use in other indications, including type 2 diabetes and certain solid tumors.

Our second product candidate is KO-2806, a selective investigational FTI, which we are evaluating as a monotherapy and as a companion inhibitor to certain targeted therapies in large solid tumor indications, including RCC and NSCLC.

Our third product candidate, tipifarnib, is a selective investigational FTI, which we are evaluating in combination with alpelisib, a PI3 kinase alpha inhibitor, in patients with HNSCC whose tumors have HRAS overexpression and/or PIK3CA mutation and/or amplification.

We also have additional programs that are at a discovery stage.

We own global commercial rights to all of our programs and product candidates.

We plan to advance our product candidates through a combination of internal development and strategic partnerships while maintaining significant development and commercial rights.

Our first product candidate, ziftomenib, is a potent, selective, reversible and oral small molecule inhibitor that blocks the interaction of two proteins, menin and the protein expressed by the KMT2A gene (formerly referred to as the mixed-lineage leukemia 1 gene).

We received orphan drug designation for ziftomenib for the treatment of AML from the FDA in July 2019.

We initiated our global menin-KMT2A Phase 1/2 clinical trial of ziftomenib in relapsed or refractory AML, which we call KOMET-001, in September 2019.

In the Phase 1a dose-escalation portion of the KOMET-001 trial, ziftomenib demonstrated a wide therapeutic window and encouraging monotherapy activity in an all-comer population of 30 patients with relapsed or refractory AML.

A total of 53 patients were treated in the Phase 1b dose-validation and dose-expansion portions of the trial, which consisted of two randomized expansion cohorts, each comprised of NPM1-mutant and KMT2A-rearranged AML patients.

Ziftomenib demonstrated optimal clinical benefit at 600 mg in the Phase 1b portion of the KOMET-001 trial and this dose was designated as the RP2D.

On June 11, 2023, we presented updated clinical data from KOMET-001, including data from Phase 1b, during a late-breaking oral session at the EHA, including durable activity in patients with heavily pretreated and co-mutated relapsed or refractory NPM1-mutant AML.

As of the data cutoff on April 12, 2023, seven of the 20 patients (35%) with NPM1-mutant AML treated at the RP2D of 600 mg achieved a CR with full count recovery.

An eighth patient, who had a CR with partial count recovery after treatment with ziftomenib, subsequently evolved to a CR with full count recovery after HCT and remained on study as of the date of the EHA presentation.

In addition, a patient with NPM1-mutant AML treated at 200 mg remained on ziftomenib for 36 cycles as of the data cutoff.

Durable remissions were observed in patients with NPM1 mutations and other key co-mutations following treatment with ziftomenib.

Notably, 33% (2/6) of patients with FLT3 co-mutations, 50% (4/8) of patients with IDH co-mutations and 50% (2/4) of patients with both FLT3 and IDH co-mutations achieved a CR at the 600 mg dose of ziftomenib.

Ziftomenib demonstrated an ORR of 45% in patients with NPM1-mutant AML treated at the 600 mg dose.

The DoR for all NPM1-mutant patients treated at 200 mg or 600 mg in the Phase 1a/b portion of the study was 8.2 months (95% CI:

1.0 to NE), with a median follow-up of 8.8 months.

The median DoR for such patients censored at stem cell transplant was 5.6 months (95% CI:

As part of an ongoing analysis, the resistance mutation MEN1-M3271 was detected in three patients treated with ziftomenib:

in two of these three patients, the mutation was detected at study entry after the patients had progressed on a prior menin inhibitor, and in the third patient, the mutation was detected after four cycles of ziftomenib therapy and, despite the mutation, the patient was maintained in a condition of stable disease through cycle 7.

These data show that MEN1 mutations developed in just 3% (1/29) of patients analyzed following treatment with ziftomenib and suggest that resistance mutations occur at a low frequency even after prolonged exposure to ziftomenib monotherapy.

A key new biochemical finding, confirmed by crystal structure, demonstrates that ziftomenib retains binding affinity against the MEN1-T349M mutation, which was detected in two-thirds of patients who acquired menin resistance mutations on another recent menin inhibitor trial.

Continuous daily dosing of ziftomenib was well tolerated and the reported adverse event profile remained consistent with features of underlying disease.

The on-target effect of DS was manageable, with 15% of patients experiencing Grade 1 or 2 events and 5% experiencing a Grade 3 event.

On February 9, 2023, we announced the dosing of the first patients in the Phase 2 registration-directed portion of the KOMET-001 study of ziftomenib in patients with relapsed or refractory NPM1-mutant AML.

Enrollment in the Phase 2 study continues to outperform our projections.

The study is expected to enroll a total of 85 patients at approximately 60 U.S.

and European sites.

We anticipate completion of enrollment of all 85 patients by mid-2024.

In May 2023, we amended the KOMET-001 protocol to include a sub-study of ziftomenib in patients with ALL, and two sub-studies of ziftomenib in patients with non-NPM1-mutant and non-KMT2A-rearranged AML.

We dosed the first patients in the ALL sub-study in the first quarter of 2024, and we expect to dose the first patients in non-NPM1-mutant and non-KMT2A-rearranged AML by mid-2024.

In addition to our monotherapy study of ziftomenib, we have initiated a series of studies to evaluate ziftomenib in combination with current standards of care in earlier lines of therapy and across multiple patient populations, including NPM1-mutant and KMT2A-rearranged AML.

KOMET-007 is designed to evaluate ziftomenib in combination with venetoclax and azacitidine in patients with newly diagnosed or relapsed or refractory NPM1-mutant or KMT2A-rearranged AML, and ziftomenib in combination with cytarabine and daunorubicin, or 7+3, in patients with newly diagnosed NPM1-mutant or KMT2A-rearranged AML.

We initiated dosing of patients in KOMET-007 in the third quarter of 2023.

On January 30, 2024, we announced preliminary data from the first 20 patients in the KOMET-007 study.

The first 20 patients were enrolled in KOMET-007 between July 2023 and November 2023, including five newly diagnosed patients with adverse risk NPM1-mutant or KMT2A-rearranged AML and 15 patients with relapsed or refractory NPM1-mutant or KMT2A-rearranged AML.

Patients are considered “adverse risk” if they are more than 60 years old and/or have treatment-related AML and/or adverse risk cytogenics per European LeukemiaNet.

Continuous daily dosing of ziftomenib at 200 mg was well tolerated and the safety profile was consistent with features of underlying disease and backbone therapies.

No differentiation syndrome events of any grade were reported, and no dose-limiting toxicities, evidence of QTc prolongation, drug-drug interactions or additive myelosuppression were observed.

As of the data cutoff on January 11, 2024, all newly diagnosed patients treated with ziftomenib and 7+3 achieved a CR with full count recovery, for a CR rate of 100% (5/5), including four patients with NPM1-mutant AML and one patient with KMT2A-rearranged AML.

The ORR among relapsed or refractory patients treated with ziftomenib and venetoclax/azacitidine was 53% (8/15).

Among all patients treated with ziftomenib and venetoclax/azacitidine, 40% (6/15) received prior treatment with a menin inhibitor.

The rate of CRs or CRhs in patients who were menin inhibitor naïve was 56% (5/9), including 60% (3/5) in patients with NPM1-mutant AML and 50% (2/4) in patients with KMT2A-rearranged AML.

The ORR in patients who received prior venetoclax was 40% (4/10), including 60% (3/5) in patients with NPM1-mutant AML.

As of the data cutoff, 80% (16/20) of patients remained on trial, including 100% (11/11) of all NPM1-mutant patients.

The 200 mg dose of ziftomenib cleared the safety threshold for dose escalation in the relapsed or refractory venetoclax/azacitidine cohorts and enrollment at the 400 mg dose is ongoing.

We anticipate determining the RP2D of ziftomenib in combination with venetoclax and azacitidine by mid-2024, upon which we plan to initiate a Phase 1b dose validation/expansion of ziftomenib in combination with venetoclax and azacitidine in newly diagnosed patients with NPM1-mutant AML (without adverse risk) or KMT2A- rearranged AML.

We also have escalated to the 400 mg dose of ziftomenib in the frontline NPM1-mutant 7 + 3 cohort, and we expect to determine the RP2D of ziftomenib in combination with 7 + 3 by mid-2024.

KOMET-008 is designed to evaluate ziftomenib in combination with gilteritinib in patients with relapsed or refractory NPM1-mutant AML, and ziftomenib in combination with fludarabine, cytarabine, G-CSF, and FLAG-IDA, or LDAC, in patients with relapsed or refractory NPM1-mutant or KMT2A-rearranged AML.

On February 26, 2024, we announced that we dosed the first patient in KOMET-008.

We also intend to evaluate the use of ziftomenib as a maintenance therapy in patients with NPM1-mutant or KMT2A-rearranged AML who have undergone HCT.

HCT represents the only potentially curative treatment for AML, yet the most common reason for long-term failure after HCT is disease relapse.

We are supporting an investigator-sponsored study, and plan to initiate a company-sponsored study, evaluating the ability of ziftomenib to improve outcomes when administered as a maintenance therapy following HCT.

We expect to initiate the post-transplant maintenance program in the first quarter of 2024.

On December 8, 2023, we announced a clinical collaboration with LLS to evaluate ziftomenib in combination with chemotherapy in pediatric patients with relapsed or refractory KMT2A-rearranged, NUP98-rearranged or NPM1-mutant acute leukemia.

Under the terms of the collaboration agreement, LLS will serve as the coordinating sponsor of a Phase 1 study of ziftomenib in pediatric patients with acute leukemias in North America, the Princess Máxima Center for Pediatric Oncology in Utrecht, the Netherlands will serve as the coordinating sponsor of the study in Europe, and Kura will supply LLS and the Princess Máxima Center with ziftomenib for the study.

Our second product candidate, tipifarnib, is a potent, selective and orally bioavailable FTI that has been previously studied in more than 5,000 cancer patients and demonstrated compelling and durable anti-cancer activity in certain patients with a manageable side effect profile.

In February 2021, tipifarnib was granted Breakthrough Therapy Designation from the FDA for the treatment of patients with HNSCC, with high VAF.

In July 2021, we announced a clinical collaboration with Novartis, to evaluate the combination of tipifarnib and alpelisib, a PI3 kinase alpha inhibitor, in patients with HNSCC whose tumors have HRAS overexpression and/or PIK3CA mutation and/or amplification.

In the fourth quarter of 2021, we commenced the KURRENT-HN trial, to evaluate the safety and tolerability of the combination, determine the recommended dose and schedule for the combination, and assess early antitumor activity of the combination for the treatment of such patients.

Under the terms of our collaboration agreement with Novartis, we sponsor the KURRENT-HN trial and supply tipifarnib, and Novartis supplies alpelisib.

In December 2021, we announced dose administration for the first patient in the PIK3CA cohort in KURRENT-HN.

In October 2022, we reported the first demonstration of a durable clinical response with the combination of tipifarnib and alpelisib in a patient with PIK3CA-mutated squamous cell carcinoma of the tonsil.

Since that time, we have continued dose escalation and have observed evidence of clinical activity, along with a manageable safety profile, at multiple doses.

We continue to evaluate patients in the dose-escalation study to inform the selection of the OBAD for the combination, which we expect to determine by the end of 2024.

Once we determine the OBAD, we will continue to evaluate whether the activity supports the development and commercialization of the combination in HNSCC.

Our newest product candidate, KO-2806, is a next-generation FTI that we believe demonstrates improved potency, pharmacokinetic and physicochemical properties relative to earlier FTI drug candidates.

In January 2023, we announced the clearance by the FDA of our IND application for KO-2806 for the treatment of advanced solid tumors.

We delivered multiple presentations of preclinical data in 2023 that we believe support the development of FTIs such as KO-2806 in combination with targeted therapies.

In April 2023, we presented preclinical data at the American Association for Cancer Research Annual Meeting highlighting the potential use of FTIs in combination with two distinct classes of targeted therapies.

The first of two posters revealed robust synergy between tipifarnib and the standard-of-care antiangiogenic TKI, axitinib in cell- and PDX models of ccRCC.

The second poster reported regression of multiple models of KRAS inhibitor-resistant NSCLC by addition of tipifarnib to adagrasib or sotorasib.

On September 28, 2023, we presented preclinical data in an oral session at the 5 th RAS-Targeted Drug Development Summit supporting the development of KO-2806 in combination with KRAS G12C inhibitors to drive tumor regressions and durable responses in KRAS G12C -mutant NSCLC.

KRAS G12C inhibitors have previously been shown to activate receptor tyrosine kinase signaling, leading to ERK-RSK and/or mTOR-S6 pathway reactivation.

Our preclinical data show that co-treatment of preclinical models of KRAS G12C -mutant NSCLC with KO-2806 and adagrasib deepens signaling inhibition at multiple nodes, including the mitogen-activated protein kinase and mTOR pathways, while decreasing cell proliferation.

In both CDX and PDX models originating from NSCLC tumors, the combination of KO-2806 with adagrasib induced tumor regressions.

In addition, the CDX and PDX models demonstrated enhanced duration and depth of antitumor response compared to adagrasib as a single-agent therapy.

On October 13, 2023, we presented preclinical data at the AACR-NCI-EORTC International Conference supporting the development of KO-2806 with targeted therapies, including TKIs, KRAS G12C inhibitors and KRAS G12D inhibitors.

three posters illustrated that KO-2806 potentiates the antitumor activity of cabozantinib in ccRCC models.

The second poster illustrated that KO-2806 blocks oncogenetic signaling at multiple nodes to enhance the antitumor activity of KRAS G12C inhibitor adagrasib in KRAS G12C NSCLC.

The third poster illustrated that KO-2806 constrains compensatory signaling reactivation to deepen responses to KRAS G12D inhibition.

We believe these data support our rationale to combine KO-2806 with TKIs in ccRCC and with KRAS G12C inhibitors in NSCLC.

We are evaluating the safety, tolerability, pharmacokinetics, pharmacodynamics and preliminary antitumor activity of KO-2806 as a monotherapy and in combination with other targeted therapies in the FIT-001 trial.

On October 19, 2023, we announced that we dosed the first patient in the monotherapy portion of the FIT-001 trial.

We anticipate dosing the first patients with KO-2806 in combination with cabozantinib in ccRCC by mid-2024.

On November 2, 2023, we announced a clinical collaboration with Mirati, to evaluate the combination of KO-2806 and adagrasib in patients with NSCLC whose tumors have a KRAS G12C mutation.

Under the terms of the agreement, Mirati will supply us with adagrasib for the NSCLC combination cohort of the FIT-001 trial, and we sponsor the trial.

We anticipate initiation of the KRAS G12C -mutant NSCLC cohort by mid-2024.

Liquidity Overview

As of December 31, 2024, we had cash, cash equivalents and short-term investments of $727.4 million.

On January 26, 2024, we completed a private placement in which we sold to certain institutional accredited investors an aggregate of 1,376,813 shares of our common stock at a purchase price of $17.25 per share and pre-funded warrants to purchase up to an aggregate of 7,318,886 shares of common stock at a purchase price of $17.2499 per pre-funded warrant (representing the $17.25 per share purchase price less the exercise price of $0.0001 per warrant share), or the Private Placement.

We received aggregate gross proceeds from the Private Placement of approximately $150.0 million, before deducting estimated offering expenses.

In June 2023, we completed a public offering in which we sold an aggregate of 5,660,871 shares of common stock at a price of $11.50 per share as well as pre-funded warrants to purchase 3,034,782 shares of our common stock at a price of $11.4999 per pre-funded warrant.

Net proceeds from the public offering, after deducting underwriting discounts and commissions and offering expenses, were approximately $93.6 million.

In February 2022, we entered into a Sales Agreement with SVB Securities LLC, Credit Suisse Securities (USA) LLC and Cantor Fitzgerald & Co.

under which we could offer and sell, from time to time, at our sole discretion, shares of our common stock having an aggregate offering price of up to $150.0 million.

We did not sell any shares of our common stock under the agreement.

On November 2, 2023, we terminated the agreement with SVB Securities LLC, Credit Suisse Securities (USA) LLC and Cantor Fitzgerald & Co.

On November 2, 2023, we entered into a new Sales Agreement with Leerink Partners LLC and Cantor Fitzgerald & Co., or the ATM Facility, under which we may offer and sell, from time to time, at our sole discretion, shares of our common stock having an aggregate offering price of up to $150.0 million.

On November 20, 2024, we entered into the Kyowa Agreement to develop and globally commercialize ziftomenib for the treatment of patients with AML and other hematologic malignancies, which may be expanded into other indications at the option of Kyowa Kirin, subject to certain conditions.

In exchange for the licenses and rights granted to Kyowa Kirin to participate in the development and commercialization of ziftomenib, we received an upfront payment of $330.0 million.

In January 2024, we completed a private placement in which we sold to certain institutional accredited investors an aggregate of 1,376,813 shares of our common stock at a purchase price of $17.25 per share and pre-funded warrants to purchase up to an aggregate of 7,318,886 shares of common stock at a purchase price of $17.2499 per pre-funded warrant (representing the $17.25 per share purchase price less the exercise price of $0.0001 per warrant share), or the Private Placement.

Net proceeds from the Private Placement, after deducting expenses, were approximately $145.8 million.

As of December 31, 2024, pre-funded warrants to purchase 559,424 of such shares of common stock had been exercised and 6,759,462 remained outstanding.

In November 2023, we entered into a Sales Agreement with Leerink Partners LLC and Cantor Fitzgerald & Co., or the ATM Facility, under which we may offer and sell, from time to time, at our sole discretion, shares of our common stock having an aggregate offering price of up to $150.0 million.

We have not sold any shares of our common stock under the ATM Facility.

In November 2022, we entered into the Loan Agreement with the Lenders, and Hercules in its capacity as administrative agent and collateral agent for itself and the Lenders, providing for up to $125.0 million in a series of Term Loans.

Upon entering into the Loan Agreement, we borrowed $10.0 million of an initial $25.0 million tranche of Term Loans.

On September 15, 2023, the draw period for the remaining $15.0 million of the Tranche 1 Loan expired without us drawing down the additional loan.

We have achieved the Tranche 2 Milestone (as defined in the Loan Agreement) and may borrow up to $35.0 million at any time until March 15, 2024.

We may borrow (i) an additional tranche of term loans in the amount of up to $40.0 million which will become available to us upon our satisfaction of certain terms and conditions set forth in the Loan Agreement, and (ii) a final tranche of term loans in the amount of up to $25.0 million, subject to the Lenders’ investment committee approval in its sole discretion.

Also, in November 2022, we entered into a securities purchase agreement with Bristol-Myers Squibb Company, or BMS, pursuant to which BMS purchased 1,370,171 shares of our common stock in a registered direct offering, at a purchase price of approximately $18.25 per share, for gross proceeds of approximately $25.0 million.

Net proceeds from the public offering, after deducting underwriting discounts and commissions and offering expenses, were approximately $93.6 million.

As of December 31, 2024, pre-funded warrants to purchase 860,869 of such shares of common stock had been exercised and 2,173,913 remained outstanding.

On January 16, 2025, the remaining 2,173,913 pre-funded warrants were exercised.

In November 2022, we entered into a loan and security agreement, or the Loan Agreement, with several banks and other financial institutions or entities party thereto, or collectively the Lenders, and Hercules Capital, Inc., or Hercules, in its capacity as administrative agent and collateral agent for itself and the Lenders, providing for up to $125.0 million in a series of term loans, or Term Loans.

Upon entering into the Loan Agreement, we borrowed $10.0 million of an initial $25.0 million tranche of Term Loans, or the Tranche 1 Loan.

In September 2023, the draw period for the remaining $15.0 million of the Tranche 1 Loan expired without us drawing down such additional loan.

In March 2024, the draw period for the $35.0 million second tranche of Term Loans expired without us drawing down such additional loan.

In December 2024, the draw period for the (i) $40.0 million third tranche of Term Loans and (ii) $25.0 million fourth tranche of Term Loans each expired without us drawing down such additional loans.

No further Term Loans may be drawn under the Loan Agreement.

To date, we have not generated any revenues from product sales, and we do not have any approved products.

Since our inception, we have funded our operations primarily through equity and debt financings.

Since our inception, we have funded our operations primarily through equity and debt financings and revenues under the Kyowa Agreement.

We anticipate that we will require significant additional financing in the future to continue to fund our operations as discussed more fully below under the heading “Liquidity and Capital Resources.”

Financial Operations Overview

Revenue from Collaborations and Licenses

We generate revenue primarily through collaboration and license agreements.

Such agreements may require us to deliver various rights and/or services, including intellectual property rights or licenses and research, development and other services.

Under such agreements, we are generally eligible to receive non-refundable upfront payments, funding for research, development and other services, milestone payments, and royalties.

Our collaboration agreements fall under the scope of Accounting Standards Codification, or ASC, Topic 808, Collaborative Arrangements, or Topic 808, when there is a joint operating activity and when both parties are active participants in the arrangement and are exposed to significant risks and rewards.

For our arrangements under the scope of Topic 808, we evaluate each promised good or service that is distinct in accordance with ASC Topic 606, Revenue from Contracts with Customers, or Topic 606.

(i.e., a unit of account) and apply Topic 606 to those units of account that are determined to be with a customer.

For all other units of account that are not within the scope of other relevant accounting topics, we analogize to other authoritative accounting literature, such as Topic 606.

Topic 606 requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers under a five-step model:

(i) identify contract(s) with a customer;

(ii) identify the performance obligations in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price to the performance obligations in the contract;

and (v) recognize revenue when or as a performance obligation is satisfied.

In contracts where we have more than one promise to provide the customer with goods or services, each promise is evaluated to determine whether it is a distinct performance obligation based on whether (i) the customer can benefit from the good or service on its own or together with other resources that are readily available and (ii) the good or service is separately identifiable from other promises in the contract.

The evaluation of whether a promised good or service is a distinct performance obligation may require significant judgment and is based on the facts and circumstances surrounding each contract and the nature of the promised goods and services within each contract.

We are required to make estimates of the transaction price, including variable consideration that is subject to a constraint.

Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur and when the uncertainty associated with the variable consideration is subsequently resolved.

At the inception of arrangements that include variable consideration, we may be required to exercise significant judgment to estimate the amount of variable consideration to include in the transaction price.

In making such estimates, we generally use the most likely amount method for milestone payments and the expected value method for other forms of variable considerations and take into account relevant development, regulatory, and other factors that can impact the level of uncertainty associated with these estimates.

If it is probable that a significant revenue reversal will not occur, the estimated amount is included in the transaction price.

Milestone payments that are not within our or the licensee’s control, such as regulatory approvals, are not included in the transaction price until those approvals are received.

These estimates are re-assessed each reporting period and we adjust our estimate of the overall transaction price as necessary.

The consideration under the contract is allocated between the distinct performance obligations based on their respective relative stand-alone selling prices.

The estimated stand-alone selling price of each performance obligation reflects our best estimate of what the selling price would be if the deliverable was regularly sold on a stand-alone basis and is determined by reference to market rates for the good or service when sold to others or by using an adjusted market assessment approach if the selling price on a stand-alone basis is not available.

The determination of the stand-alone selling price often requires significant judgment.

Our estimates of the stand-alone selling price for license-related performance obligations may include forecasted revenues and expenses, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical, regulatory and commercial success.

Our estimates of the stand-alone selling price for research and development or other service-related performance obligations generally include forecasting the expected costs of satisfying a performance obligation at market rates.

We also exercise significant judgment in allocating variable consideration that relates specifically to our efforts to satisfy one or more, but not all, performance obligations and determining whether such allocation is consistent with the overall allocation objectives within Topic 606.

The consideration allocated to each distinct performance obligation is recognized as revenue when control is transferred to the customer for the related goods or services.

For performance obligations satisfied over time, we determine the measure of progress that best represents the transfer of goods or services to the customer.

Revenue is recognized by measuring the progress towards complete satisfaction of the performance obligation using an input-based measure.

Estimating the progress of the performance obligation requires significant management estimates, such as forecasting costs necessary to satisfy the performance obligation.

Sales-based royalties received in connection with licenses of intellectual property are subject to a specific exception in Topic 606, whereby the consideration is not included in the transaction price and recognized in revenue until the customer’s subsequent sales or usages occur.

We may also be entitled to cost-share reimbursements or may be required to share profits related to our collaboration and license agreements.

These amounts will be recognized when control of the related goods or services are transferred to the customer.

Cost-sharing reimbursements are presented as revenue.

Research and Development Expenses

3 unchanged sentences

Payments that we make in connection with in-licensed technology for a particular research and development project that have no alternative future uses in other research and development projects or otherwise and therefore, no separate economic values, are expensed as research and development costs at the time such costs are incurred.

As of December 31, 2023, we have no in-licensed technologies that have alternative future uses in research and development projects or otherwise.

As of December 31, 2024, we had no in-licensed technologies that had alternative future uses in research and development projects or otherwise.

We cannot determine with certainty the timing of initiation, the duration or the completion costs of current or future preclinical studies and clinical trials of our product candidates.

22 unchanged sentences

Other income, net consists primarily of interest income and interest expense.

We have incurred net losses and have not recorded any U.S.

federal or state income tax benefits for the losses as they have been offset by valuation allowances.

For the year ended December 31, 2024, we recorded current Federal and state tax provisions of $1.8 million and $0.2 million, respectively.

For the years ended December 31, 2023 and 2022 we did not record a provision for income taxes due to a full valuation against our deferred taxes.

Results of Operations

2 unchanged sentences

Years Ended December 31,

Collaboration revenue

Research and development expenses

1 unchanged sentence

Other income, net

Collaboration Revenue.

We recognized collaboration revenue of $53.9 million for the year ended December 31, 2024 related to the license granted and services performed under the Kyowa Agreement entered into in November 2024.

Research and Development Expenses .

2 unchanged sentences

Ziftomenib-related costs

Tipifarnib-related costs

KO-2806-related costs

Tipifarnib-related costs

Discovery stage program-related costs

2 unchanged sentences

Total research and development expenses

The increase in ziftomenib-related research and development expenses for the year ended December 31, 2023 compared to 2022 was primarily due to increases in costs related to our registration-directed clinical trial of ziftomenib and the initiation of the ziftomenib combination trials.

The decrease in tipifarnib-related research and development expenses for the year ended December 31, 2023 compared to 2022 was primarily due to the closure of our registration-directed trial of tipifarnib.

The increase in ziftomenib-related research and development expenses for the year ended December 31, 2024 compared to 2023 was primarily due to increases in costs related to our registration-directed clinical trial of ziftomenib and the ziftomenib combination trials.

The increase in KO-2806-related research and development expenses for the year ended December 31, 2024 compared to 2023 was primarily due to increased costs related to our Phase 1 clinical trial.

The increase in discovery stage program-related research and development expenses for the year ended December 31, 2023 compared to 2022 was primarily due to increased research activities for our preclinical-stage product candidates.

The increase in personnel costs and other expenses for the year ended December 31, 2023 compared to 2022 was primarily due to increased costs to support our ongoing clinical trials and includes employee salaries and related expenses, facilities expenses and overhead expenses.

The decrease in tipifarnib-related research and development expenses for the year ended December 31, 2024 compared to 2023 was primarily due to the closure of our registration-directed trial of tipifarnib.

The increase in personnel costs and other expenses for the year ended December 31, 2024 compared to 2023 was primarily due to a retention tax credit recognized in the first quarter of 2023, and increases in headcount costs to support our ongoing clinical trials.

We expect our research and development expenses to increase in future periods as we continue clinical development activities for our ziftomenib and FTI programs.

General and Administrative Expenses .

The increase in general and administrative expenses for the year ended December 31, 2023 compared to 2022 was primarily due to increases in professional fees and personnel costs.

The increase in general and administrative expenses for the year ended December 31, 2024 compared to 2023 was primarily due to increases in personnel costs, inclusive of a retention tax credit recognized in the first quarter of 2023, pre-commercial planning expenses, non-cash share-based compensation expense, and professional services.

We expect our general and administrative expenses to increase in future periods to support our planned increase in research and development activities.

2 unchanged sentences

Liquidity and Capital Resources

Since our inception, we have funded our operations primarily through equity and debt financings.

Since our inception, we have funded our operations primarily through equity and debt financings and through revenues under the Kyowa Agreement.

We have devoted our resources to funding research and development programs, including discovery research, preclinical and clinical development activities.

On November 20, 2024, we entered into the Kyowa Agreement to develop and globally commercialize ziftomenib for the treatment of patients with AML and other hematologic malignancies, or the Field.

In exchange for the licenses and rights granted to Kyowa Kirin to participate in the development and commercialization of ziftomenib, we received an upfront payment of $330.0 million and are eligible to receive up to an additional $933.0 million in development, regulatory and commercial milestone payments for the Field.

On January 26, 2024, we completed the Private Placement in which we sold to certain institutional accredited investors an aggregate of 1,376,813 shares of our common stock at a purchase price of $17.25 per share and pre-funded warrants to purchase up to an aggregate of 7,318,886 shares of common stock at a purchase price of $17.2499 per pre-funded warrant (representing the $17.25 per share purchase price less the exercise price of $0.0001 per warrant share).

We received aggregate gross proceeds from the Private Placement of approximately $150.0 million, before deducting estimated offering expenses.

Net proceeds from the Private Placement, after deducting expenses, were approximately $145.8 million.

As of December 31, 2024, pre-funded warrants to purchase 559,424 of such shares of common stock had been exercised and 6,759,462 remained outstanding.

In November 2023, we entered into the ATM Facility under which we may offer and sell, from time to time, at our sole discretion, shares of our common stock having an aggregate offering price of up to $150.0 million.

We have not sold any shares of our common stock under the ATM Facility.

Net proceeds from the public offering, after deducting underwriting discounts and commissions and offering expenses, were approximately $93.6 million.

On November 2, 2022, we entered into the Loan Agreement with the Lenders and Hercules, in its capacity as agent, providing for up to $125.0 million in a series of Term Loans.

Under the terms of the Loan Agreement, we borrowed $10.0 million of an initial $25.0 million tranche of Term Loans, or the Tranche 1 Loan.

On September 15, 2023, the draw period for the remaining $15.0 million of the Tranche 1 Loan expired without us drawing down the additional loan.

We have achieved the Tranche 2 Milestone (as defined in the Loan Agreement) and may borrow up to $35.0 million, or the Tranche 2 Loan, at any time until March 15, 2024.

Thereafter, we may borrow (i) an additional tranche of Term Loans in the amount of up to $40.0 million, or the Tranche 3 Loan, which will become available to us upon our satisfaction of certain terms and conditions set forth in the Loan Agreement, and (ii) a final tranche of Term Loans in the amount of up to $25.0 million, or the Tranche 4 Loan, subject to the Lenders’ investment committee approval in its sole discretion.

As of December 31, 2024, pre-funded warrants to purchase 860,869 of such shares of common stock had been exercised and 2,173,913 remained outstanding.

On January 16, 2025, the remaining 2,173,913 pre-funded warrants were exercised.

In November 2022, we entered into the Loan Agreement with the Lenders and Hercules, in its capacity as administrative agent and collateral agent for itself and the Lenders, providing for up to $125.0 million in a series of Term Loans.

Under the terms of the Loan Agreement, we borrowed $10.0 million of an initial $25.0 million Tranche 1 Loan.

In September 2023, the draw period for the remaining $15.0 million of the Tranche 1 Loan expired without us drawing down such additional loan.

In March 2024, the draw period for the $35.0 million second tranche of Term Loans expired without us drawing down such additional loan and in December 2024, the draw period for the (i) $40.0 million third tranche of Term Loans and (ii) $25.0 million fourth tranche of term loans expired without us drawing down such additional loans.

No further Term Loans may be drawn under the Loan Agreement.

All of the Term Loans have a maturity date of November 2, 2027, or the Maturity Date.

Repayment of the Term Loans is interest only through (a) May 1, 2025, with the satisfaction of the Interest Only Milestone 1 Conditions (as defined in the Loan Agreement), (b) November 1, 2025, if we satisfy the Interest Only Milestone 2 Conditions (as defined in the Loan Agreement), and (c) November 1, 2026, if we satisfy the Approval Milestone (as defined in the Loan Agreement).

After the interest-only payment period, borrowings under the Loan Agreement are repayable in equal monthly payments of principal and accrued interest until the Maturity Date.

After the interest-only payment period, borrowings under the Loan Agreement are repayable in monthly payments of principal and accrued interest until the Maturity Date.

The per annum interest rate for the Term Loans is the greater of (i) the prime rate as reported in The Wall Street Journal minus 6.25% plus 8.65% and (ii) 8.65%.

1 unchanged sentence

Prepayments made on or prior to the third anniversary of the date of the Loan Agreement will be subject to a prepayment fee equal to 1.50% of the principal amount being prepaid.

In addition, we paid a facility charge of approximately $0.1 million upon closing and an additional approximately $0.2 million of facility charges in November 2023 due to the availability of the Tranche 2 Loan.

Additional facility charges will be incurred upon the availability of the Tranche 3 Loan or Tranche 4 Loan, in each case in the amount of 0.50% of the amount of such tranche of loans.

The Loan Agreement also provides for an end of term fee in an amount equal to the greater of approximately (i) $1.5 million (which is 6.05% of the maximum amount of the first tranche of loans) or (ii) 6.05% of the aggregate principal amount of loan advances actually made under the Loan Agreement, which fee is due and payable on the earliest to occur of (i) the Maturity Date, (ii) the date we prepay the outstanding loans in full, and (iii) the date that the secured obligations become due and payable.

1 unchanged sentence

As part of the Loan Agreement, we are subject to certain negative covenants, which, among other things, prohibit us from selling, transferring, assigning, mortgaging, pledging, leasing, granting a security interest in or otherwise encumbering our intellectual property, subject to limited exceptions.

On November 2, 2023, we entered into the ATM Facility under which we may offer and sell, from time to time, at our sole discretion, shares of our common stock having an aggregate offering price of up to $150.0 million.

We have not sold any shares of our common stock under the ATM Facility.

We have incurred operating losses and negative cash flows from operating activities since inception.

1 unchanged sentence

We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the research and development of, continue and initiate clinical trials of, and seek marketing approval for, our product candidates.

In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution to the extent that such sales, marketing and distribution are not the responsibility of potential collaborators.

Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations.

1 unchanged sentence

As of December 31, 2024, we had cash, cash equivalents and short-term investments of $727.4 million.

Based on our current plans, we believe that our cash, cash equivalents and short-term investments as of December 31, 2023, together with the net proceeds from the Private Placement, will be sufficient to enable us to fund our operating expenses into 2027.

Based on our current plans, we believe our cash, cash equivalents and short-term investments as of December 31, 2024 will be sufficient to enable us to fund our current operating expenses into 2027, and combined with anticipated collaboration funding under the Kyowa Agreement, should support our ziftomenib AML program through commercialization in the frontline combination setting.

Our future capital requirements will depend on many factors, including:

1 unchanged sentence

• the costs, timing and outcome of regulatory review of our product candidates;

• the costs of establishing or contracting for sales, marketing and distribution capabilities if we obtain regulatory approvals to market our product candidates;

• the costs of fully developing our sales, marketing and distribution capabilities if we obtain regulatory approvals to market our product candidates;

• the costs of securing and producing drug substance and drug product material for use in preclinical studies, clinical trials and for use as commercial supply;

1 unchanged sentence

• the scope, prioritization and number of our research and development programs;

• the extent to which we are obligated to reimburse, or entitled to reimbursement of, clinical trial costs under future collaboration agreements, if any;

• the extent to which we are obligated to reimburse, or entitled to reimbursement of, clinical trial costs under current or any future collaboration agreements;

• the extent to which we acquire or in-license other product candidates and technologies;

5 unchanged sentences

We are subject to all of the risks incident in the development of new therapeutic products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business.

We anticipate that we will need substantial additional funding in connection with our continuing operations.

Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of stock offerings, debt financings, collaborations, strategic partnerships or licensing arrangements.

Other than our term loan facility, we do not have any committed external source of funds.

We may need substantial additional funding in connection with our continuing operations.

Additional capital may not be available on reasonable terms, if at all.

2 unchanged sentences

Debt financing, if available, may involve agreements that include increased fixed payment obligations and covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, declaring dividends, selling or licensing intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business.

If we raise additional funds through collaborations, strategic partnerships or licensing arrangements with third parties, we may have to relinquish valuable rights to our product candidates, including our other technologies, future revenue streams or research programs, or grant licenses on terms that may not be favorable to us.

If we raise additional funds through collaborations, strategic partnerships or licensing arrangements with third parties, such as the Kyowa Agreement, we may have to relinquish valuable rights to our product candidates, including our other technologies, future revenue streams or research programs, or grant licenses on terms that may not be favorable to us.

If we are unable to raise additional funds when needed, we may be unable to carry out our business plan.

2 unchanged sentences

Years Ended December 31,

Net cash used in operating activities

Net cash provided by investing activities

Net cash provided by (used in) operating activities

Net cash provided by (used in) investing activities

Net cash provided by financing activities

Operating Activities .

The increase of $14.8 million in net cash used in operating activities for the year ended December 31, 2023 compared to 2022 was primarily due to an increase of $16.8 million in net loss adjusted for $11.0 million in accretion of discount on marketable securities, offset by changes in operating assets and liabilities of $10.8 million.

The increase of $259.1 million in net cash provided by operating activities for the year ended December 31, 2024 compared to 2023 was primarily due to an increase of $278.2 million in contract liabilities related to the Kyowa Agreement, offset by an increase of $21.4 million in net loss.

Investing Activities .

Net cash provided by investing activities for the years ended December 31, 2023 and 2022 was primarily due to maturities, offset by purchases of marketable securities.

The increase of $117.1 million in net cash used in investing activities for the year ended December 31, 2024 compared to 2023 was primarily due to an increase of $249.2 million in purchases of short-term investments, offset by an increase of $132.4 million in maturities of short-term investments.

Financing Activities .

Net cash provided by financing activities for the year ended December 31, 2023 primarily related to net proceeds of $93.6 million from the sale of shares of our common stock and pre-funded warrants to purchase shares of our common stock in our June 2023 public offering.

Net cash provided by financing activities for the year ended December 31, 2022 primarily related to net proceeds of $24.7 million from the BMS equity investment in November 2022, proceeds of $4.4 million from the issuance of shares of common stock under our equity plans and net proceeds of $9.4 million from the issuance of long-term debt.

Net cash provided by financing activities for the year ended December 31, 2024 primarily related to net proceeds of approximately $145.8 million from the sale of shares of our common stock and pre-funded warrants to purchase shares of our common stock in our January 2024 Private Placement and proceeds of $8.6 million from the issuance of shares of common stock under our equity plans.

Net cash provided by financing activities for the year ended December 31, 2023 was primarily due to $93.6 million in net proceeds from the sale of shares of our common stock and pre-funded warrants to purchase shares of our common stock in our June 2023 public offering.

Contractual Obligations and Commitments

4 unchanged sentences

Interest payments on long-term debt (3)

______________________

(1) Future minimum lease payments under our operating leases in San Diego, California and Boston, Massachusetts.

4 unchanged sentences

In addition, an end of term fee will be due in an amount equal to the greater of approximately (i) $1.5 million or (ii) 6.05% of the aggregate principal amount of loan advances actually made, payable on the earliest of the maturity date, acceleration or prepayment of the Term Loans.

Subsequent to December 31, 2024, we entered into a new lease agreement for office space in San Diego, California.

See Note 16, Subsequent Events, in the Notes to Financial Statements of this Annual Report for further details.

We enter into short-term and cancellable agreements in the normal course of operations with clinical sites and CROs for clinical research studies, professional consultants and various third parties for preclinical research studies, clinical supply manufacturing and other services through purchase orders or other documentation.

3 unchanged sentences

These payments are not included in the table of contractual obligations above.

Excluded from the table above are milestone or contractual payment obligations contingent upon the achievement of certain milestones or events if the amount and timing of such obligations are unknown or uncertain.

Our in-license agreements are cancelable by us with written notice within 180 days or less.

We may be required to pay up to approximately $80.0 million in milestone payments, plus sales royalties, in the event that regulatory and commercial milestones under the in-license agreements are achieved.

Under the Kyowa Agreement, we will be funding the specified development activities included in the Development Plan that are planned to be conducted prior to the end of 2028, and we will share equally (50/50) with Kyowa Kirin all development costs for all other development activities in the United States included in the Development Plan (including the costs of future trials conducted under the Development Plan in the United States).

We will share equally with Kyowa Kirin in any potential profits and losses arising from the commercialization of ziftomenib in the United States for the existing Field and, if Kyowa Kirin exercises the Field Expansion Option, the expanded Field.

Critical Accounting Policies and Management Estimates

3 unchanged sentences

The preparation of these financial statements required estimates and judgments that affect the reported amounts of assets, liabilities, and expenses and the disclosure of contingent assets and liabilities in the financial statements.

On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses and share-based compensation.

On an ongoing basis, we evaluate our estimates and judgments, including those related to revenue from collaborations and licenses, and clinical trial costs and accruals.

We base our estimates on historical experience, known trends and events, and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

1 unchanged sentence

While our significant accounting policies are described in more detail in Note 2 in the Notes to Financial Statements of this Annual Report, we believe the following accounting policies are critical to the judgments and estimates used in the preparation of our financial statements.

Research and Development Expenses

We make estimates of our accrued expenses as of each balance sheet date in our financial statements based on facts and circumstances known to us at that time.

If the actual timing of the performance of services or the level of effort varies from the estimate, we will adjust the accrual accordingly.

Non-refundable advance payments for goods and services, including fees for process development or manufacturing and distribution of clinical supplies that will be used in future research and development activities, are deferred and recognized as expense in the period that the related goods are consumed or services are performed.

Payments that we make in connection with in-licensed technology for a particular research and development project that have no alternative future uses, in other research and development projects or otherwise, and therefore no separate economic values are expensed as research and development costs at the time such costs are incurred.

Revenue from Collaborations and Licenses

Our collaboration agreements fall under the scope of Topic 808, when there is a joint operating activity and when both parties are active participants in the arrangement and are exposed to significant risks and rewards.

For our arrangements under the scope of Topic 808, we evaluate each promised good or service that is distinct in accordance with Topic 606 (i.e., a unit of account) and apply Topic 606 to those units of account that are determined to be with a customer.

For all other units of account that are not within the scope of other relevant accounting topics, we analogize to other authoritative accounting literature, such as Topic 606.

In applying Topic 808 and Topic 606, we are required to make estimates of the transaction price, including variable consideration that is subject to a constraint.

In making such estimates, we generally use the most likely amount method and take into account relevant development, regulatory, and other factors that can impact the level of uncertainty associated with these estimates.

If it is probable that a significant revenue reversal will not occur, the estimated amount is included in the transaction price.

Milestone payments that are not within our or the licensee’s control, such as regulatory approvals, are not included in the transaction price until those approvals are received.

These estimates are re-assessed each reporting period and we adjust our estimate of the overall transaction price as necessary.

The consideration under the contract is allocated between the distinct performance obligations based on their respective relative stand-alone selling prices.

The determination of the stand-alone selling price often requires significant judgment.

Clinical Trial Costs and Accruals

10 unchanged sentences

Interest Rate Risk

We hold certain financial instruments for which a change in prevailing interest rates may cause the principal amount of the marketable securities to fluctuate.

We hold certain financial instruments for which a change in prevailing interest rates may cause the principal amount of the short-term investments to fluctuate.

Financial instruments that potentially subject us to significant concentrations of credit risk consist primarily of cash, cash equivalents and short-term investments.

3 unchanged sentences

Agency bonds.

The primary objectives of our investment activities are to ensure liquidity and to preserve principal while at the same time maximizing the income we receive from our marketable securities without significantly increasing risk.

The primary objectives of our investment activities are to ensure liquidity and to preserve principal while at the same time maximizing the income we receive from our short-term investments without significantly increasing risk.

Additionally, we established guidelines regarding approved investments and maturities of investments, which are designed to maintain safety and liquidity.

12 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis