What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-02-28 compared with 2024-02-27 · 299 added, 139 removed, 717 unchanged (38% of the section changed)

11 unchanged sentences

The effectiveness of our internal control over financial reporting as of December 31, 2024 has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in its report, which is included herein.

Change in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting identified in connection with management’s evaluation of such internal control that occurred during our most recent quarter ended December 31, 2023 that have materially affected, or are reasonably likely to material affect, our internal control over financial reporting.

Changes in Internal Control Over Financial Reporting

During the quarter ended December 31, 2024, we entered into the Kyowa Agreement and began to recognize revenue.

We updated the processes that constitute our internal control over revenue and financial reporting, as necessary, to accommodate related changes to our accounting procedures and business processes.

Except for the changes related to the Kyowa Agreement, there have been no changes in our internal control over financial reporting identified in connection with management’s evaluation of such internal control that occurred during our most recent quarter ended December 31, 2024 that have materially affected, or are reasonably likely to material affect, our internal control over financial reporting.

Report of Independent Registered Public Accounting Firm

33 unchanged sentences

We will promptly disclose on our website (i) the nature of any amendment to the Code of Business Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions and (ii) the nature of any waiver, including an implicit waiver, from a provision of the Code of Business Conduct and Ethics that is granted to one of these specified individuals that is required to be disclosed pursuant to SEC rules and regulations, the name of such person who is granted the waiver and the date of the waiver.

We have adopted insider trading policies and procedures governing the purchase, sale and/or other dispositions of our securities by our directors, officers and employees that are reasonably designed to promote compliance with insider trading laws, rules and regulations, and listing standards applicable to us.

A copy of our insider trading policy is filed with this Annual Report as Exhibit 19.1.

Executiv e Compensation.

34 unchanged sentences

(Exhibit 4.5)

Form of Pre-Funded Warrant.

(Exhibit 4.1)

Description of Registrant’s Common Stock.

2 unchanged sentences

(Exhibit 4.1)

Form of Pre-Funded Warrant.

(Exhibit 4.1)

Registration Rights Agreement, dated January 26, 2024, by and among the Registrant and the persons party thereto.

38 unchanged sentences

Amended and Restated Non-Employee Director Compensation Policy.

(Exhibit 10.1)

Form of International Stock Option Grant Notice, International Stock Option Agreement and International Notice of Exercise under the Kura Oncology, Inc.

33 unchanged sentences

Kura Oncology, Inc.

2023 Inducement Option Plan and Forms of Stock Option Grant Notice, Option Agreement and Notice of Exercise thereunder.

2023 Inducement Option Plan, as amended, and Forms of Stock Option Grant Notice, Option Agreement and Notice of Exercise thereunder.

(Exhibit 99.1)

Second Amendment to Amended and Restated Executive Employment Agreement, effective as of April 11, 2024, by and between the Registrant and Troy E.

Wilson, Ph.D., J.D.

(Exhibit 10.1)

Collaboration and License Agreement, dated November 20, 2024, by and among the Registrant Kyowa Kirin Co., Ltd.

and Kyowa Kirin, Inc.

Settlement Agreement, effective as of January 2, 2025, by and between the Registrant and Stephen Dale, M.D.

Third Amended & Restated Executive Employment Agreement, effective as of January 2, 2025, by and between the Registrant and Mollie Leoni, M.D.

Third Amended & Restated Executive Employment Agreement, effective as of January 2, 2025, by and between the Registrant and Francis Burrows, Ph.D.

Lease, effective January 13, 2025, by and between the Registrant and HCP Life Science REIT, Inc.

Kura Oncology, Inc.

Insider Trading Policy

Consent of Independent Registered Public Accounting Firm.

4 unchanged sentences

Incentive Compensation Recoupment Policy.

(Exhibit 97.1)

Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Inline XBRL Taxonomy Extension Schema Document.

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

Inline XBRL Taxonomy Extension Definition Linkbase Document.

Inline XBRL Taxonomy Extension Label Linkbase Document.

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents.

Incorporated by Reference herein

SEC File/Reg.

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101.INS).

+ Indicates management contract or compensatory plan.

* Certain portions of this exhibit (indicated by “[***]”) have been omitted as the Registrant has determined (i) the omitted information is not material and (ii) the omitted information would likely cause harm to the Registrant if publicly disclosed.

* Certain portions of this exhibit have been omitted pursuant to Item 601 of Regulation S-K.

** Confidential treatment has been granted with respect to certain portions of this exhibit.

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February 28, 2025

/s/ Michael Vasconcelles, M.D.

February 28, 2025

Michael Vasconcelles, M.D.

Report of Independent Registered Public Accounting Firm

17 unchanged sentences

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Clinical Trial Research and Development Expenses and Accruals

14 unchanged sentences

We also examined a sample of subsequent payments to evaluate the completeness of the accrued third-party clinical trial research and development expenses.

Accounting for the Kyowa Kirin collaboration and license agreement

Description of

The Company’s collaboration revenues are derived from a collaboration and license agreement with Kyowa Kirin Co., Ltd (“the Collaboration and License Agreement”), which primarily includes licensing intellectual property and providing research and development and other commercialization services.

The Company recognized revenue of $53.9 million for the year ended December 31, 2024 and a related contract liability of $278.2 million as of December 31, 2024 related to this agreement.

As discussed in Note 2 of the financial statements, the total consideration related to the Collaboration and License Agreement may include many elements such as non-refundable fees at the inception of the arrangement, cost reimbursements, milestone payments and royalties.

In some circumstances, management is required to use judgment to determine whether analogies to the revenue accounting literature are appropriate for elements of collaboration arrangements.

The Company also develops estimates of the stand-alone selling price for each distinct performance obligation, which involve assumptions that may require significant judgment.

Auditing the Company’s revenue recognition for the Collaboration and License Agreement was complex and required the Company to apply significant judgment, including in the assessment of appropriate authoritative guidance, determination of performance obligations, and the estimation of the standalone selling price of each distinct performance obligation.

The estimates of the standalone selling price for the performance obligations relating to the license, development and commercialization services reflect management’s assumptions, which included forecasted revenues and expenses, expected development timelines, discount rates and probabilities of technical, regulatory and commercial success.

Addressed the

Matter in Our

We obtained an understanding, evaluated the design, and tested the operating effectiveness of internal controls over the Company’s process for the accounting of the Collaboration and License Agreement.

For example, we tested management’s controls over the determination of appropriate authoritative guidance related to the identification of each unit of account and the determination of standalone selling price of each distinct performance obligation.

To test the accounting for revenue from the Collaboration and License Agreement, our audit procedures included, among others, obtaining and reading the Collaboration and License Agreement and evaluating management's identification of significant terms for completeness, including identification of each unit of account, and evaluating the appropriateness of management’s application of authoritative guidance.

To test the estimates of standalone selling price for each distinct performance obligation, our audit procedures included, among others, evaluating management’s estimate of the standalone selling price of each distinct performance obligation.

For example, we evaluated forecasted revenues and expenses, expected development timelines and probabilities of technical, regulatory and commercial success by analyzing and comparing the significant assumptions to relevant industry data, comparable companies and the Company’s communication with its collaboration partner.

We also involved our valuation professionals to assist in the assessment of the methodologies and discount rates used for each distinct performance obligation.

We performed a sensitivity analysis to evaluate the impact that changes in the significant assumptions would have on the estimated standalone selling prices, the allocation of the transaction price, and to revenue recognized during the period.

We also tested the completeness and accuracy of the underlying data used in the valuation of the standalone selling prices including the forecasted revenues and expenses.

/s/ Ernst & Young LLP

17 unchanged sentences

Current operating lease liabilities

Current portion of long-term debt

Current portion of contract liabilities

Total current liabilities

Long-term debt, net

Long-term debt, net of current portion

Long-term operating lease liabilities

Other long-term liabilities

Long-term contract liabilities

Total liabilities

9 unchanged sentences

Additional paid-in capital

Accumulated other comprehensive loss

Accumulated other comprehensive income (loss)

Accumulated deficit

6 unchanged sentences

Years Ended December 31,

Collaboration revenue

Total revenue

Operating Expenses

2 unchanged sentences

Total operating expenses

Loss from operations

Other Income (Expense)

2 unchanged sentences

Total other income, net

Loss before income taxes

Income tax expense

Net loss per share, basic and diluted

3 unchanged sentences

Other comprehensive income (loss)

Unrealized gain (loss) on marketable securities

and foreign currency

Unrealized gain (loss) on short-term investments

Comprehensive loss

7 unchanged sentences

Balance as of December 31, 2021

Issuance of common stock, net of offering costs

Share-based compensation expense

Issuance of common stock under equity plans

Issuance of warrants in connection with debt facility

Other comprehensive loss

1 unchanged sentence

Issuance of common stock, net of offering costs

Issuance of pre-funded warrants to purchase common stock, net of offering costs

Share-based compensation expense

Issuance of common stock under equity plans

Issuance of warrants in connection with debt facility

Other comprehensive loss

Other comprehensive income

Balance as of December 31, 2023

2 unchanged sentences

Share-based compensation expense

Exercise of pre-funded warrants

Issuance of common stock under equity plans

7 unchanged sentences

Operating Activities

Adjustments to reconcile net loss to net cash used in operating

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Share-based compensation expense

Amortization of premium and accretion of discounts on

marketable securities, net

short-term investments, net

Depreciation expense

Non-cash interest expense

Loss from extinguishment of debt

Changes in operating assets and liabilities:

Prepaid expenses and other current assets

Operating lease right-of-use and other long-term assets

Contract liabilities

Accounts payable and accrued expenses

Operating lease right-of-use and other long-term assets

Other long-term liabilities

Net cash used in operating activities

Net cash provided by (used in) operating activities

Investing Activities

Maturities of marketable securities

Purchases of marketable securities

Purchases of short-term investments

Maturities of short-term investments

Purchases of property and equipment

5 unchanged sentences

Payment of fees related to issuance of long-term debt

Repayment of long-term debt

Payment of fees related to extinguishment of debt

Net cash provided by (used in) financing activities

Net decrease in cash, cash equivalents

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents at beginning of period

10 unchanged sentences

is 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.

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.

We are conducting clinical trials of three product candidates:

ziftomenib, tipifarnib and KO-2806.

ziftomenib, KO-2806 and tipifarnib.

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.

1 unchanged sentence

Summary of Significant Accounting Policies

Reclassifications

The prior period restricted cash balance of approximately $ 0.2 million has been reclassified to other long-term assets in the accompanying financial statements.

See Note 8, Commitments and Contingencies, for further details.

Use of Estimates

4 unchanged sentences

All revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

Segment Reporting

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance.

We operate in a single industry segment which is the discovery and development of precision medicines for the treatment of cancer.

Wilson, our president and chief executive officer, who serves as the chief operating decision-maker, reviews the operating results on an aggregate basis and manages the operations as a single operating segment in the United States.

Cash and Cash Equivalents

5 unchanged sentences

The cost of short-term investments is adjusted for amortization of premiums or accretion of discounts to maturity, and such amortization or accretion is included in interest income.

Dividend and interest income is recognized as interest income on the statements of operations and comprehensive loss when earned.

Short-term investments are classified as available-for-sale securities and carried at fair value with unrealized gains and non-credit related losses recorded in other comprehensive loss and included as a separate component of stockholders’ equity.

Dividend and interest income is included in interest and other income, net on the statements of operations and comprehensive loss when earned.

Short-term investments are classified as available-for-sale securities and carried at fair value with unrealized gains and non-credit related losses recorded in other comprehensive income (loss) and included as a separate component of stockholders’ equity.

Realized gains and losses from the sale of available-for-sale securities are determined on a specific identification basis and included in interest and other income, net on the statements of operations and comprehensive loss.

4 unchanged sentences

In making this assessment, we consider the severity of the impairment, any changes in interest rates, market conditions, changes to the underlying credit ratings and forecasted recovery, among other factors.

The credit-related portion of unrealized losses, and any subsequent improvements, are recorded in interest income through an allowance account.

Any impairment that has not been recorded through an allowance for credit losses is included in other comprehensive loss on the statements of operations and comprehensive loss.

The credit-related portion of unrealized losses, and any subsequent improvements, are recorded in interest and other income, net on the statements of operations and comprehensive loss through an allowance account.

Any impairment that has not been recorded through an allowance for credit losses is included in other comprehensive income (loss) on the statements of operations and comprehensive loss.

We elected the practical expedient to exclude the applicable accrued interest from both the fair value and amortized costs basis of our available-for-sale securities for purposes of identifying and measuring an impairment.

42 unchanged sentences

For a modification that is not a separate contract, we reassess the lease classification using the modified terms and conditions and the facts and circumstances as of the effective date of the modification and recognize the amount of the remeasurement of the lease liability for the modified lease as an adjustment to the corresponding operating lease ROU asset.

Collaboration Arrangements

We assess whether our licensing and other agreements are collaborative arrangements within the scope of Accounting Standards Codification, or ASC, Topic 808, Collaborative Arrangements, or Topic 808, based on whether they involve joint operating activities wherein both parties actively participate in the arrangement and are exposed to significant risks and rewards of the arrangement.

For arrangements that we determine are collaborations under the Scope of Topic 808, we identify each unit of account by determining which promised goods or services are distinct in accordance with ASC Topic 606, Revenue from Contracts with Customers, or Topic 606, and then determine whether a customer relationship exists for that unit of account.

If we determine a unit of account within the collaborative arrangement to be with a customer, we apply our revenue recognition accounting policy as further described below.

For units of account within the collaborative arrangement under Topic 808 that are not with a customer in its entirety and are not within the scope of other relevant accounting topics, we apply recognition and measurement principles based on an analogy to authoritative accounting literature or, if there is no appropriate analogy, a reasonable, rational and consistently applied accounting policy election.

See Note 8, Kyowa Kirin Collaboration and License Agreement, for more details.

Revenue from Collaborations and Licenses

We recognize revenue when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

To determine revenue recognition for arrangements that are within the scope of Topic 606, we perform the following five steps:

(i) identify the 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) the entity satisfies a performance obligation.

For enforceable contracts with our customers, we evaluate the promises in the contract that are based on goods and services that will be transferred to the customer and determine whether those promises are both (i) capable of being distinct and (ii) distinct in the context of the contract.

Arrangements that include rights to additional goods or services that are exercisable at the customer’s discretion are generally considered customer options.

We assess if these customer options provide a material right to the customer and, if so, these customer options are considered performance obligations.

The transaction price may comprise of payments received under our commercial arrangements, such as licensing technology rights, and may include non-refundable fees at the inception of the arrangements, cost reimbursements, milestone payments for specific achievements designated in the agreements, and royalties on the sale of products.

Profit-sharing payments to our customers are generally not for a distinct good or service and, as such, are included as a reduction of the transaction price.

At the inception of arrangements that include variable consideration, we use judgment to estimate the amount of variable consideration to include in the transaction price generally using the most likely amount method.

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.

At the end of each reporting period, we re-evaluate estimated variable consideration included in the transaction price and any related constraint and, as necessary, we adjust our estimate of the overall transaction price.

Any adjustments are recorded on a cumulative catch-up basis, which affects revenues and earnings in the period of adjustment.

We develop estimates of the stand-alone selling price for each distinct performance obligation, which involve assumptions that may require 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 allocate the transaction price, including any unconstrained variable consideration, to the performance obligations within the arrangement based on the relative stand-alone selling prices.

When the variable consideration relates specifically to our efforts to satisfy one or more, but not all, performance obligations and allocating the consideration specifically to those performance obligations is consistent with the overall allocation objectives within Topic 606, we allocate the consideration entirely to those performance obligations.

We use judgment to assess the nature of the performance obligation to determine whether the performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue related to the performance obligation.

If the performance obligation is satisfied over time, we evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition.

The selection of the method to measure progress towards completion of over-time performance obligations is based on the nature of the products or services to be provided.

Our over-time performance obligations generally involve research and development or other services provided to the customer, and we generally use a cost-to-cost measure of progress because it best depicts the transfer of control to the customer.

Under a cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date compared to the total estimated costs at completion of the performance obligation (an “input method” under Topic 606).

We use judgment to estimate the total cost expected to complete the research and development or other service-related performance obligations, which include subcontractors’ costs, labor, materials, other direct costs and an allocation of indirect costs.

We evaluate these cost estimates and the progress each reporting period and, as necessary, we adjust the measure of progress and related revenue recognition.

For arrangements that include sales-based or usage-based royalties, we recognize 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.

For arrangements that include cost-share reimbursements or obligations to share profits, we will recognize such payments when control of the related goods or services are transferred to the customer.

Consideration received or invoices issued as stipulated in contracts prior to revenue recognition are recorded as contract liabilities in the accompanying balance sheets, classified as either current or long-term contract liabilities based on our best estimate of when such amounts will be recognized.

Amounts recognized as revenue, but not yet invoiced are generally recognized as contract assets in other current assets in the accompanying balance sheets.

Research and Development Expenses

31 unchanged sentences

Comprehensive loss is defined as the change in equity during the period from transactions and other events and non-owner sources.

For the periods presented, accumulated other comprehensive loss consisted of unrealized gains and losses on marketable securities and foreign currency.

For the periods presented, accumulated other comprehensive income (loss) consisted of unrealized gains and losses on short-term investments .

Net Loss per Share

Basic net loss per common share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, which includes the shares related to outstanding pre-funded warrants (see Note 9), but excludes other potential common stock equivalents.

Pre-funded warrants are considered outstanding for the purposes of computing basic and diluted net loss per share because shares may be issued for little or no additional consideration, and are fully vested and exercisable.

Basic net loss per common share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, which includes the shares related to outstanding pre-funded warrants, but excludes other potential common stock equivalents.

Pre-funded warrants are considered outstanding for the purposes of computing basic and diluted net loss per share because shares may be issued for little additional consideration, and are fully vested and exercisable.

Diluted net loss per share is calculated by dividing net loss by the weighted-average number of common shares and common stock equivalents outstanding for the period.

2 unchanged sentences

Common stock equivalents outstanding as of December 31, 2024, 2023 and 2022 totaling approximately 15,430,000 , 12,642,000 and 9,266,000 , respectively, were excluded from the computation of dilutive weighted-average shares outstanding because their effect would be anti-dilutive.

Segment Reporting

We operate in a single industry segment which is the discovery and development of precision medicines for the treatment of cancer.

Wilson, Ph.D., J.D., our president and chief executive officer, who serves as the Chief Operating Decision-Maker , or CODM, reviews the operating results on an aggregate basis and manages the operations as a single operating segment in the U.S.

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies that we adopt as of the specified effective date.

We have evaluated recently issued accounting pronouncements and, based on our preliminary assessment, we do not believe any will have a material impact on our financial statements or related footnote disclosures.

Improvements to Reportable Segment Disclosures

In November 2023, the Financial Accounting Standards Board, or FASB, issued ASU 2023-07 – Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures, which improves segment disclosure requirements, primarily through enhanced disclosure requirements for significant segment expenses.

The improved disclosure requirements apply to all public entities that are required to report segment information, including those with only one reportable segment.

We adopted the guidance for the fiscal year ended December 31, 2024.

There was no impact on our reportable segments identified and additional required disclosures have been included in Note 15, Segment Reporting.

Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09 – Improvements to Income Tax Disclosures (Topic 740), which improves the transparency of income tax disclosures by requiring disaggregated information about our effective tax rate reconciliation as well as information on income taxes paid.

For each annual period, we will be required to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold

(if the effect of those reconciling items is equal to or greater than 5 % of the amount computed by multiplying pretax income or loss by the applicable statutory income tax rate).

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

Early adoption is permitted for annual financial statements that have not yet been issued.

We plan to adopt the standard on December 31, 2025, and are currently evaluating the effect of the standard on our financial statements.

We invest in available-for-sale securities consisting of U.S.

Treasury securities, corporate debt securities, non-U.S.

government and supranational debt securities, money market funds, U.S.

Agency bonds and commercial paper.

Treasury securities, money market funds, corporate debt securities, non-U.S.

government debt securities and U.S.

Agency bonds.

Available-for-sale securities are classified as either cash and cash equivalents or short-term investments on the balance sheets.

6 unchanged sentences

Treasury securities

Corporate debt securities

government debt securities

Total short-term investments

3 unchanged sentences

Money market funds

Total cash equivalents

Short-term investments

1 unchanged sentence

Corporate debt securities

Commercial paper

government and supranational debt securities

government debt securities

Total short-term investments

Short-term investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date, which reflects management’s intention to use the proceeds from sales of these securities to fund our operations, as necessary.

As of December 31, 2023 and 2022, short-term investm ents of $ 336.6 million and $ 274.3 million, respectively, had maturities less than one year, and short-term investments of $ 50.0 million and $ 111.9 million, respectively, had maturities between one to two years.

As of December 31, 2024 and 2023, short-term investm ents of $ 393.1 million and $ 336.6 million, respectively, had maturities less than one year, short-term investments of $ 97.3 million and $ 50.0 million, respectively, had maturities between one to two years, and short-term investments of $ 12.5 million and zero , respectively, had maturities between two to three years.

Realized gains and losses were de minimis for the years ended December 31, 2024, 2023 and 2022.

As of December 31, 2023 and 2022 , 16 available-for-sale securities with a fair market value o f $ 155.2 million and 34 available-for-sale securities with a fair market value of $ 290.0 million, respectively, were in gross unrealized loss positions, $ 105.0 million and $ 172.4 million of which were in a continuous unrealized loss position for greater than 12 months, respectively.

As of December 31, 2024 and 2023, two available-for-sale securities with a fair market value o f $ 10.0 million and 16 available-for-sale securities with a fair market value of $ 155.2 million, respectively, were in gross unrealized loss positions, no ne and $ 105.0 million of which were in a continuous unrealized loss position for greater than 12 months, respectively.

We do not intend to sell these available-for-sale securities, and it is not more likely than not that we will be required to sell these securities prior to recovery of their amortized cost basis.

Based on our review of these available-for-sale securities, the unrealized losses as of December 31, 2023 were primarily due to changes in interest rates and not due to increased credit risks associated with specific securities .

We have no allowance for credit losses as of December 31, 2024 and 2023.

Unrealized gains and losses that are not credit-related are included in accumulated other comprehensive loss.

Accrued interest receivable on available-for-sale securities were $ 1.1 million and $ 0.9 million as of December 31, 2023 and 2022, respectively.

Unrealized gains and losses that are not credit-related are included in accumulated other comprehensive income (loss).

Accrued interest receivable on available-for-sale securities were $ 3.3 million and $ 1.1 million as of December 31, 2024 and 2023, respectively, which were included in prepaid expenses and other current assets on the balance sheets.

We have not written off any accrued interest receivables for the years ended December 31, 2024, 2023 and 2022 .

1 unchanged sentence

As of December 31, 2024 and 2023, we had cash equivalents and short-term investments measured at fair value on a recurring basis.

Available-for-sale securities consist of U.S.

Available-for-sale securities consist of money market funds and U.S.

Treasury securities, which are measured at fair value using Level 1 inputs, and corporate debt securities, non-U.S.

government and supranational debt securities, U.S.

Agency bonds and commercial paper which are measured at fair value using Level 2 inputs.

government debt securities, and U.S.

Agency bonds which are measured at fair value using Level 2 inputs.

We determine the fair value of Level 2 related securities with the aid of valuations provided by third parties using proprietary valuation models and analytical tools.

1 unchanged sentence

We validate the fair values of Level 2 financial instruments by comparing these fair values to a third-party pricing source.

We did not reclassify any investments between levels in the fair value hierarchy during the periods presented.

The following tables summarize, by major security type, our cash equivalents and short-term investments that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy, in thousands:

4 unchanged sentences

Treasury securities

Corporate debt securities

government debt securities

Total short-term investments

2 unchanged sentences

Money market funds

Total cash equivalents

Short-term investments

1 unchanged sentence

Corporate debt securities

Commercial paper

government and supranational debt securities

government debt securities

Total short-term investments

10 unchanged sentences

Property and equipment, net

Depreciation expense was $ 0.8 million , $ 0.8 million and $ 0.6 million for the years ended December 31, 2023, 2022 and 2021, respectively.

Depreciation expense was $ 0.8 million for each of the years ended December 31, 2024, 2023 and 2022.

Accounts payable and accrued expenses consisted of the following, in thousands:

4 unchanged sentences

Other accrued expenses

Income taxes payable

Total accounts payable and accrued expenses

Lo ng-Term Debt

On November 2, 2022, we entered into a loan and security agreement, or Loan Agreement, with several banks and other financial institutions or entities party thereto, or collectively Lenders, and Hercules Capital, Inc., or Hercules, in its capacity as adminis trative agent and collateral agent for itself and the Lenders, or in such capacity, Agent.

On November 2, 2022, we entered into a loan and security agreement, or Loan Agreement, with several banks and other financial institutions or entities party thereto, or collectively Lenders, and Hercules Capital, Inc., or Hercules, in its capacity as administrative agent and collateral agent for itself and the Lenders, or in such capacity, Agent, providing for up to $ 125.0 million in a series of term loans, or 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 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 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.

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 each 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) if we satisfy the Interest Only Milestone 2 Conditions (as defined in the Loan Agreement), November 1, 2025 , and (c) if we satisfy the Approval Milestone (as defined in the Loan Agreement), November 1, 2026 .

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%.

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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.

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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.

The Loan Agreement also contains a minimum cash covenant, commencing on June 1, 2024, requiring us to hold cash in the United States and subject to a first-priority perfected security interest in favor of the Lenders in an amount greater than or equal to (x) 55.0% of the outstanding loan obligations if we have not received FDA approval for ziftomenib, or (y) 35.0% of the outstanding loan obligations if we have received FDA approval for ziftomenib, provided that neither (x) nor (y) will apply at any time our market capitalization is equal to or greater than $ 1,250.0 million.

The Loan Agreement also contains a minimum cash covenant, which commenced on June 1, 2024, requiring us to hold cash in the United States and subject to a first-priority perfected security interest in favor of the Lenders in an amount greater than or equal to (x) 55.0% of the outstanding loan obligations if we have not received FDA approval for ziftomenib, or (y) 35.0% of the outstanding loan obligations if we have received FDA approval for ziftomenib, provided that neither (x) nor (y) will apply at any time our market capitalization is equal to or greater than $ 1,250.0 million.

Additionally, the Loan Agreement contains minimum cash requirements in the event of (i) any Corporate Collaborations (as defined in the Loan Agreement) or (ii) any cash payment in respect of permitted convertible debt subject to the satisfaction of the Redemption Conditions (as defined in the Loan Agreement).

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The number of Warrant Shares for which the Warrants are exercisable and the associated exercise price are subject to certain customary proportional adjustments for fundamental events, including stock splits and reverse stock splits, as set forth in the Warrants.

If we make additional draws on the Tranche 2 Loan, Tranche 3 Loan or Tranche 4 Loan, upon the funding of such additional tranches, the Warrants shall become exercisable for an additional aggregate number of shares of our common stock equal to 1.50 % of each drawn amount divided by the exercise price of $ 14.38 per share.

The initial tranche 1 borrowing of $ 10.0 million and the warrants issued upon closing to purchase 26,078 shares of our common stock are accounted for as freestanding debt and equity financial instruments, respectively, as they are legally detachable and separately exercisable.

The additional borrowings available under the Tranche 1 Loan, Tranche 2 Loan, Tranche 3 Loan and Tranche 4 Loan plus the additional warrants to purchase shares of our common stock, which would be issued concurrently, are accounted for as a single freestanding financial instrument that are not assets or obligations of ours;

this financial instrument meets the loan commitment derivative scope exception and will be accounted for when and if we borrow additional tranches in the future.

In connection with the Loan Agreement, we recognized the initial 26,078 issued warrants at their relative fair value of approximately $ 0.3 million, and we incurred debt issuance costs of $ 0.6 million, which were recorded as debt discounts.

The fair value of the warrants, debt issuance costs and end of term fee are being amortized and accreted into interest expense using the effective interest rate method over the term of the loan.

As of December 31, 2024, no ne of the Warrants had been exercised.

The following table summarizes maturities of principal obligation payments under the term loan facility as of December 31, 2024, in thousands:

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Long-term debt, net

In November 2018, we entered into a loan and security agreement with Silicon Valley Bank, or the SVB Loan Agreement, providing for up to $ 20.0 million in a series of term loans.

Upon entering into the SVB Loan Agreement, we borrowed $ 7.5 million, or the SVB Term Loan.

The SVB Term Loan had a scheduled maturity date of May 1, 2023 .

In May 2021, we paid $ 6.6 million to repay all amounts owed under the SVB Term Loan, which included a final payment of $ 0.6 million, representing 7.75 % of the SVB Term Loan which was being accrued through interest expense using the effective interest method, and a prepayment fee of $ 30,000 .

In accordance with ASC 470-50, Debt Modifications and Extinguishments, we accounted for the transaction as an extinguishment of debt.

Accordingly, we recorded a loss of approximately $ 0.2 million, which is included in interest expense on the statements of operations and comprehensive loss for the year ended December 31, 2021.

License Agreements

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The licensed asset consists of several compounds, including our development candidate ziftomenib.

All future development, regulatory and commercial work on the asset will be completed fully and at our sole expense.

As between us and the University of Michigan, all future development, regulatory and commercial work on the asset will be completed fully and at our sole expense.

The University of Michigan retains the right to use the asset for non-commercial research, internal and/or educational purposes, with the right to grant the same limited rights to other non-profit research institutions.

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Janssen may also terminate the agreement due to our lack of diligence that is not cured within a three-month period.

Future Milestone Payments under License Agreements

Collectively, all of our license agreements provide for specified development, regulatory and sales-based milestone payments up to a total of $ 80.2 million payable upon occurrence of each stated event, of which $ 0.5 million relates to the initiation of certain development activities, $ 28.9 million relates to the achievement of specified regulatory approvals for the first indication and up to $ 50.8 million relates to the achievement of specified levels of product sales.

Payments under License Agreements

Collectively, our license agreements provide for specified development, regulatory and sales-based milestone payments up to a total of $ 80.2 million payable upon occurrence of each stated event, of which $ 0.5 million relates to the initiation of certain development activities, $ 28.9 million relates to the achievement of specified regulatory approvals for the first indication and up to $ 50.8 million relates to the achievement of specified levels of product sales.

Additional payments will be due for each subsequent indication if specified regulatory approvals are achieved.

As of December 31, 2023, we have paid milestone payments tot aling $ 0.3 million u nder the above-mentioned license agreements.

For the year ended December 31, 2024, we incurred sublicense fees of $ 4.8 million.

As of December 31, 2024, we have paid milestone payments tot aling $ 0.3 million and incurred sublicense fees totaling $ 4.8 million .

Furthermore, if all the programs are successfully commercialized, we will be required to pay tiered royalties on annual net product sales ranging from the low single digits to the low teens, depending on the volume of sales and the respective agreement.

Kyowa Kirin Collaboration and License Agreement

On November 20, 2024, we and Kyowa Kirin Co., Ltd.

and Kyowa Kirin, Inc., or together Kyowa Kirin, entered into a Collaboration and License Agreement, or the Kyowa Agreement, to develop and commercialize globally our product candidate, ziftomenib, a potent, selective oral menin inhibitor, for the treatment, diagnosis and prevention of patients with acute myeloid leukemia, or AML, and other hematologic malignancies, and if Kyowa Kirin exercises the Field Expansion Option (as defined below), the treatment, diagnosis and prevention of all cancers, or collectively the Field.

We will lead all development, manufacturing, and regulatory activities and commercial strategy development for ziftomenib in the United States based on a development plan and budget mutually agreed upon with Kyowa Kirin and under the oversight of a joint steering committee and applicable subcommittees.

In accordance with the development plan, we plan to conduct multiple phase 2 and phase 3 clinical trials of ziftomenib, as a monotherapy and in combination with other therapies, in AML and other hematologic malignancies over the next several years.

The activities required by the development plan will be allocated to and conducted by both us and Kyowa Kirin.

We will fund the specified development activities set forth in the initial development plan that are planned to be conducted prior to the end of 2028, and we will share with Kyowa Kirin equally (50/50) all development costs for all other development activities in the United States that are to be included in the development plan, including clinical trials and post-marketing commitments that are reasonably necessary for obtaining or maintaining regulatory approval of ziftomenib in the United States, or Development Services.

In addition, we will conduct certain specified development and manufacturing activities outside the scope of the development plan at our sole cost and expense.

Following regulatory approval, we will commercialize and record sales of ziftomenib in the United States, and Kyowa Kirin will have the right and responsibility to co-promote ziftomenib for up to a certain percentage of the details in the United States.

In collaboration with Kyowa Kirin, we will perform commercialization activities, or Commercialization Services, in accordance with a co-created U.S.

territory commercialization plan and budget.

The parties will share equally all costs and expenses for, and profits or losses from, the commercialization of ziftomenib in the United States.

Kyowa Kirin will lead development, regulatory activities and commercialization for ziftomenib outside of the United States and will be solely responsible for the conduct and funding of such activities that are specific to the exploitation of ziftomenib outside of the United States.

Following regulatory approval, Kyowa Kirin will be solely responsible for the conduct and funding of commercialization of ziftomenib outside of the United States (including recording sales).

Kyowa Kirin is required to use commercially reasonable efforts to conduct the development of ziftomenib outside the United States in accordance with an ex-U.S.

territory development plan, to achieve the development milestone events outside the United States that entitle us to receive corresponding development milestone payments, and to commercialize ziftomenib in each country outside of the United States where it has received regulatory approval.

Development and commercialization activities outside of the United States will also be under the oversight of the joint steering committee and applicable subcommittees.

We will be responsible for the global manufacture and supply of ziftomenib necessary for the development and commercialization activities described above, pursuant to the terms of a supply agreement to be negotiated by the parties.

Kyowa Kirin has the right to request that we conduct a manufacturing technology transfer and to take over the responsibility of commercial supply of ziftomenib outside the United States.

We granted Kyowa Kirin an exclusive license to enable or allow Kyowa Kirin to develop, manufacture, and commercialize ziftomenib within the Field outside of the United States, or the License.

We also granted Kyowa Kirin rights to fulfill their responsibilities related to the Development Services and Commercialization Services as part of the joint development and commercialization of ziftomenib in the United States.

In addition, Kyowa Kirin has an option to expand the licensed Field to include the development and commercialization of ziftomenib, or Field Expansion Option, which option can be exercised within a specified time period after receipt of clinical data from the planned proof-of-concept study evaluating ziftomenib and imatinib in patients with advanced gastrointestinal stromal tumors, or GIST, who are not successfully treated with imatinib.

After Kyowa Kirin’s exercise of the Field Expansion Option, the Field would include the treatment, diagnosis and prevention of all cancers, including GIST and other solid tumors.

In exchange for the License and Kyowa Kirin’s rights to participate in the development and commercialization activities described above, we received an upfront payment of $ 330.0 million.

We are eligible to receive, if Kyowa Kirin exercises the Field Expansion Option, up to an aggregate of $ 1.161 billion in development, regulatory, commercial milestone and additional upfront payments for the existing Field and the expanded Field, totaling up to $ 1.491 billion in upfront and milestone payments in the aggregate.

We are also eligible to receive tiered double-digit royalties on sales of ziftomenib outside of the United States on a country-by-country basis until the latest of expiration of the last-to-expire valid claim of our patent rights licensed to Kyowa Kirin in such country, expiration of the last-to-expire regulatory exclusivity in such country and ten years after first commercial sale in such country, or the Royalty Term.

The Kyowa Agreement will remain in effect in the United States until the latest of expiration of all valid claims of our patent rights licensed to Kyowa Kirin, expiration of the last-to-expire regulatory exclusivity or ten years after first commercial sale.

The Kyowa Agreement will remain in effect outside the United States until the expiration of the last-to-expire Royalty Term.

Either party may terminate the Kyowa Agreement for uncured material breach by or insolvency of the other party.

Kyowa Kirin may terminate the Agreement for convenience upon twelve months’ prior written notice.

In addition, Kyowa Kirin has the right to terminate the Kyowa Agreement with a shorter specified notice period upon the occurrence of a material adverse regulatory event or certain other specified events.

We may terminate the Kyowa Agreement if Kyowa Kirin or any of its affiliates or sublicensees challenges the validity or enforceability of any of the patent rights licensed to Kyowa Kirin by us.

Based on our analysis of the key terms and activities required by the Kyowa Agreement summarized above and given the involvement by both parties, we assessed the criteria under Topic 808 and concluded that both parties participate in a joint operating activity, are active participants, and are exposed to significant risks and rewards dependent on the commercial success of the activities.

Therefore, the Kyowa Agreement was determined to be within the scope of Topic 808.

We evaluated each of the required promised goods and services and determined the Kyowa Agreement contains multiple units of account comprised of the License, Development Services related to monotherapy and in combination with other therapies, and Commercialization Services.

The License is a unit of account under the scope of Topic 606 as it is reflective of a typical vendor-customer relationship, while the Development Services and Commercialization Services are under the scope of Topic 808 due to the joint participation in the services being performed and these services not being reflective of a typical vendor-customer relationship.

However, we determined that Topic 606 was the most appropriate accounting model to apply by analogy to the recognition and measurement of these units of account.

We determined the upfront fixed payment amount of $ 330.0 million should be included in the transaction price.

All variable consideration related to milestones has been fully constrained due to development, regulatory, or other factors that caused us to determine that it was not probable that a significant reversal of revenue would not occur at the contract inception date and as of December 31, 2024.

We will recognize any royalties or sales-based milestones related to the License granted to Kyowa Kirin when the associated sales occur, and relevant sales-based thresholds are met.

As of December 31, 2024, no royalties or sales-based milestones have been recognized.

We allocated the transaction price comprised of the upfront fixed payment to each unit of account based on their relative stand-alone selling price.

Variable consideration that relates specifically to our efforts to satisfy specific performance obligations, such as certain milestones, is allocated entirely to those performance obligations.

Other components of variable consideration that do not relate specifically to our efforts to satisfy specific performance obligations are allocated based on the relative stand-alone selling price.

We are entitled to cost-sharing reimbursements from Kyowa Kirin for certain development and commercialization activities we perform and determined that such reimbursements are specifically related to our efforts to satisfy the respective performance obligations while satisfying the overall allocation objective required by Topic 606.

We recognized revenue allocated to the License at a point in time and upon transfer in November 2024, resulting in $ 49.8 million of revenue for the year ended December 31, 2024.

The consideration allocated to the Development Services for monotherapy and in combination with other therapies was $ 12.6 million and $ 90.2 million, respectively, and to Commercialization Services was $ 177.4 million.

The allocated consideration is being recognized over time using a cost-to-cost measure of progress.

We estimated the total cost expected to perform the required activities and measured the progress towards completion of each of these obligations at the reporting period.

For the year ended December 31, 2024, we recognized $ 0.8 million of revenue from Development Services for monotherapy, $ 0.5 million of revenue from Development Services in combination with other therapies, and $ 0.7 million of revenue from Commercialization Services.

For the year ended December 31, 2024, we also recognized $ 2.1 million of revenue from cost-share reimbursements owed to us by Kyowa Kirin, and the related receivable was included in prepaid expenses and other current assets on the balance sheet as of December 31, 2024.

As of December 31, 2024, the contract liability amount of $ 278.2 million represents the aggregate transaction price allocated to performance obligations that are unsatisfied under the Kyowa Agreement, $ 24.3 million was classified as current contract liabilities, which represents the portion of the Development Services and Commercialization Services expected to be provided over the next year, and the remaining contract liability balance of $ 253.9 million was classified as long-term contract liabilities.

Commitments and Contingencies

Operating Leases

We currently have three operating leases for administrative and research and development office and lab space in San Diego, California and Boston, Massachusetts that expire between July 2024 and July 2031 .

Under the terms of the operating leases, we are required to pay our proportionate share of property taxes, insurance and normal maintenance costs.

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Our San Diego corporate headquarters lease and our San Diego lease for lab and office space provided for $ 1.0 million and $ 0.1 million, respectively, in reimbursements for allowable tenant improvements, which effectively reduced the total lease payments owed.

On August 30, 2023, we entered into an amendment to the lease agreement for office space in Boston, Massachusetts, or the Amendment, pursuant to which the term of the lease was extended by seven years , or the Extended Term, such that the lease will now expire in July 2031.

The minimum rent payable during the Extended Term is approximately $ 0.1 million per month for the first year, which amount will increase by 2 % per year over the Extended Term.

The Amendment provides (i) a rent credit in the amount of approximately $ 0.5 million to be applied as a credit against the rent payments due for the months of August 2023 through July 2024, inclusive, and (ii) a tenant improvement allowance in an amount not to exceed approximately $ 0.8 million, in each case subject to certain conditions.

In August 2023, we entered into an amendment to the lease agreement for office space in Boston, Massachusetts, or the Amendment, pursuant to which the term of the lease was extended by seven years , or the Extended Term, such that the lease will now expire in July 2031.

The minimum rent payable during the Extended Term was approximately $ 0.1 million per month for the first year, which amount increases by 2 % per year over the Extended Term.

The Amendment provided (i) a rent credit in the amount of approximately $ 0.5 million which was applied as a credit against the rent payments due for the months of August 2023 through July 2024, inclusive, and (ii) a tenant improvement allowance in an amount not to exceed approximately $ 0.8 million, in each case subject to certain conditions.

We elected to apply the tenant improvement allowance as a credit against the rent payments due for the months of August 2024 through March 2025, inclusive.

Prior to the Amendment, we were required to maintain a standby letter of credit of approximately $ 0.2 million during the term of the lease.

Under the terms of the Amendment, we are required to maintain a cash deposit of approximately $ 0.2 million during the term of the lease which was included within other long-term assets in the balance sheet.

Maturities of our lease liabilities as of December 31, 2024 are as follows, in thousands:

Year Ending December 31,

Years Ending December 31,

Total lease payments

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Total cash paid for amounts included in the measurement of operating lease liabilities, net of tenant improvement reimbursements, was $ 1.5 million, $ 2.1 million and $ 2.3 million for the years ended December 31, 2024, 2023 and 2022 , respectively.

Operating lease ROU assets obtained in exchange for operating lease liabilities were $ 4.7 million, zero and $ 1.0 million for the years ended December 31, 2023, 2022 and 2021, respectively.

Total operating lease expense and rent expense were approximately $ 2.0 million for all the years ended December 31, 2023, 2022 and 2021.

Operating lease ROU assets obtained in exchange for operating lease liabilities were $ 4.7 million for the year ended December 31, 2023.

There were no operating lease ROU assets obtained in exchange for operating liabilities for the years ended December 31, 2024 and 2022.

Total operating lease expense and rent expense for the years ended December 31, 2024, 2023 and 2022 was approximately $ 1.9 million, $ 2.0 million and $ 2.0 million, respectively.

From time to time, we may be involved in disputes, including litigation, relating to claims arising out of operations in the normal course of our business.

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Stockholders’ Equity

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

The exercise price of each pre-funded warrant is $ 0.0001 per share and the pre-funded warrants are exercisable from the date of issuance until fully exercised.

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.

The common stock and pre-funded warrants met the accounting standards guidance for equity classification, and proceeds were allocated between common stock and pre-funded warrant based on their relative fair value.

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 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 (representing the $ 11.50 per share purchase price less the exercise price of $ 0.0001 per warrant share).

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 securities purchase agreement with Bristol-Myers Squibb Company, or BMS, pursuant to which BMS purchased an aggregate of 1,370,171 shares of our common stock at a purchase price of approximately $ 18.25 per share, for gross proceeds of approximately $ 25.0 million.

In November 2022, in connection with the Loan Agreement, we issued warrants to certain of the Lenders to purchase up to 26,078 shares of our common stock at an exercise price of $ 14.38 per share, which remained outstanding as of December 31, 2024.

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

On November 2, 2023, we terminated the 2022 Sales Agreement and 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.

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

In connection with the loan and security agreement with Oxford Finance LLC and Silicon Valley Bank in 2016, we issued a warrant to Oxford Finance LLC to purchase up to 33,988 shares of our common stock at an exercise price of $ 3.31 per share, which remains outstanding as of December 31, 2023.

In November 2023, we terminated the 2022 Sales Agreement.

In connection with a loan and security agreement with Oxford Finance LLC and Silicon Valley Bank in 2016, we issued a warrant to Oxford Finance LLC to purchase up to 33,988 shares of our common stock at an exercise price of $ 3.31 per share, which remained outstanding as of December 31, 2024.

Share-Based Compensation

Equity Incentive Plan

In March 2015, our board of directors adopted our Amended and Restated 2014 Equity Incentive Plan, which was most recently amended in May 2023, or 2014 Plan, to, among other things, increase the shares available for future grant by 4,050,000 shares and remove the automatic annual 4 % increase to shares available for future grant.

In March 2015, our board of directors adopted our Amended and Restated 2014 Equity Incentive Plan, which was most recently amended in June 2024, or 2014 Plan, to, among other things, increase the shares available for future grant by 5,500,000 shares.

The 2014 Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock unit awards, performance-based stock awards and other forms of equity compensation to our employees, consultants and members of our board of directors.

We issue shares of common stock upon the exercise of options and vesting of restricted stock unit awards and performance-based restricted stock unit awards with the source of those shares of common stock being newly issued shares.

As of December 31, 2023, 24,327,686 shares of common stock had been reserved for issuance and 3,713,092 shares of common stock were available for grant under the 2014 Plan.

As of December 31, 2024, 29,827,686 shares of common stock were reserved for issuance and 5,725,119 shares of common stock were available for grant under the 2014 Plan.

Inducement Option Plan

On December 18, 2023, our board of directors adopted the 2023 Inducement Option Plan, or Inducement Plan, to reserve 600,000 shares of our common stock to be used exclusively for grants of nonstatutory stock options to individuals that were not previously our employees or directors (or following a bona fide period of non-employment), as an inducement material to the individual’s entry into employment with us, pursuant to Nasdaq Listing Rule 5635(c)(4).

In December 2023, our board of directors adopted the 2023 Inducement Option Plan, which was most recently amended in December 2024, or Inducement Plan, to increase the shares available for future grant by 1,900,000 shares.

The terms and conditions of the Inducement Plan are substantially similar to our 2014 Plan.

As of December 31, 2023, there were 600,000 shares available to be issued from the Inducement Plan.

As of December 31, 2024, 2,500,000 shares of common stock were reserved for issuance and 1,948,600 shares of common stock were available for grant under the Inducement Plan .

Employee Stock Purchase Plan

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Eligibl e employees may elect to withhold up to 15 % of their base earnings to purchase shares of our common stock at a price equal to 85 % of the fair market value on the first day of the offering period or the purchase date, whichever is lower.

The number of shares of our common stock reserved for issuance under the ESPP will automatically increase on January 1 of each calendar year through January 1, 2025 by the lesser of 1 % of the total number of shares of our common stock outstanding on December 31 of the preceding calendar year and 2,000,000 shares of common stock, subject to the ability of our board of directors to take action to reduce the size of the increase in any given year.

In December 2023, the compensation committee of our board of directors elected not to automatically increase the number of shares of our common stock reserved for issuance under the ESPP in 202 4.

As of December 31, 2023, we have issued 250,573 s hares of common stock, and 653,852 s hares of common stock are reserved for future issuance under the ESPP.

Share-based compensation expense related to the ESPP for the years ended December 31, 2023, 2022 and 2021 was $ 0.3 million in each year.

As of December 31, 2024, we had issued 345,817 s hares of common stock, and 558,608 s hares of common stock were reserved for future issuance under the ESPP.

Share-based compensation expense related to the ESPP for the years ended December 31, 2024, 2023 and 2022 was $ 0.5 million, $ 0.3 million and $ 0.3 million, respectively .

Stock Options, Restricted Stock Unit Awards and Performance-Based Restricted Stock Unit Awards

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Restricted stock unit awards, or RSUs, are share awards that, upon vesting, will deliver to the holder shares of our common stock.

We began issuing RSUs in 2021.

The RSUs generally vest annually over four years .

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Performance-Based Restricted Stock Unit Awards

On May 31, 2023, upon approval by our stockholders of our amended 2014 Plan, we granted an aggregate of 1,313,100 performance-based restricted stock units, or PSUs, to certain executives.

In May 2023, upon approval by our stockholders of our amended 2014 Plan, we granted an aggregate of 1,313,100 performance-based restricted stock units, or PSUs, to certain executives.

The PSUs vest in six equal tranches upon the achievement of certain milestones and service conditions.

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1.6 % — 4.2 %

4.4 % — 5.4 %

Expected dividend yield

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The expected term of stock options represents the period that the stock options are expected to remain outstanding.

Beginning in 2022, we determined our expected term assumption using our own historical exercise experience.

In prior years, due to our limited historical exercise behavior, we determined the expected term assumption using the simplified method.

We determined our expected term assumption using our own historical exercise experience.

The expected term of the ESPP stock purchase rights is six months, which represents the length of each purchase period.

Expected volatility.

Beginning in 2022, expected volatility for stock options was calculated based on our historical volatility.

In prior years, due to our limited trading history, expected volatility was based, in part, on our historical volatility and the historical volatility of comparable publicly-traded companies.

Expected volatility for the ESPP stock purchase rights is based on our historical volatility.

Expected volatility for stock options and ESPP stock purchase rights was calculated based on our historical volatility.

Risk-free interest rate.

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Our president and chief executive officer is also the sole managing member and a significant stockholder of Araxes Pharma LLC, or Araxes.

We have a management services agreement with Araxes pursuant to which Araxes pays us monthly fees for management services calculated based on costs incurred by us in the provision of services to Araxes, plus a reasonable mark-up.

We had a management services agreement with Araxes pursuant to which Araxes paid us monthly fees for management services calculated based on costs incurred by us in the provision of services to Araxes, plus a reasonable mark-up.

For the years ended December 31, 2024, 2023 and 2022, we recorded management fee income of approximate ly $ 0.1 million each year, which is included in interest and other income, net on the statements of operations and comprehensive loss.

In addition, the agreement allows for Araxes to reimburse us an amount equal to the number of full-time equivalents performing research and development services for Araxes, plus actual expenses as reasonably incurred.

In addition, the agreement allowed for Araxes to reimburse us an amount equal to the number of full-time equivalents performing research and development services for Araxes, plus actual expenses as reasonably incurred.

For the years ended December 31, 2024 , 2023 and 2022, we did no t record any reimbursements for research and development expenses provided to Araxes.

The management services agreement with Araxes was terminated on December 31, 2024.

Employee Benefit Plan

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Under the terms of the plan, employees may make voluntary contributions as a percentage or defined amount of compensation.

We provided a safe harbor contribution of 4.0 % of the employee’s compensation, not to exceed eligible limits.

For the years ended December 31, 2024, 2023 and 2022, we provided a safe harbor contribution of 5 %, 4 % and 4 %, respectively, of the employee’s compensation, not to exceed eligible limits.

For the years ended December 31, 2024, 2023 and 2022, we incurred approximately $ 1.9 million, $ 1.5 million and $ 1.2 million, respectively, in expenses related to the safe harbor contribution.

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 no t record a provision for income taxes due to a full valuation against our deferred taxes.

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Net operating loss carryforwards

Research and development tax credit carryforwards

Contract liabilities

Section 174 capitalization

Research and development tax credit carryforwards

Share-based compensation

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Deferred tax liabilities

Right-of-use assets

Other comprehensive income

Total deferred tax liabilities

valuation allowance

Net deferred tax assets

As of December 31, 2023 , we had federal net operating loss, or NOL, carryforwards of $ 457.3 million, of which $ 381.8 million can be carried forward indefinitely.

The remaining federal net operating loss carryforwards of $ 75.5 million will begin to expire in 2034 , unless previously utilized.

As of December 31, 2024 , we had federal net operating loss, or NOL, carryforwards of $ 252.8 million, that can be carried forward indefinitely.

As of December 31, 2024, we had state loss carryforwards of $ 641.0 million, which will begin to expire in 2030 , unless previously utilized.

We also have federal and state research and development credit carryforwards of $ 35.1 million and $ 7.7 million, respectively, as of December 31, 2023 .

We also have federal and state research and development credit carryforwards of $ 50.0 million and $ 7.9 million, respectively.

The federal research and development credits will begin to expire in 2040 , unless previously utilized.

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The valuation allowance increased by $ 54.7 million from December 31, 2023.

Pursuant to Sections 382 and 383 of the Internal Revenue Code, or IRC, annual use of our NOL or research and development credit carryforwards may be limited in the event a cumulative change in ownership of more than 50% occurs within a three-year period.

We previously completed a study to assess whether an ownership change, as defined by IRC Section 382, had occurred from our formation through March 31, 2016.

Based upon this study, we determined that an ownership change occurred but concluded the annual utilization limitation would be sufficient to utilize our pre-ownership change NOLs and research and development credits prior to expiration.

We completed additional studies and concluded no further ownership changes occurred through December 31, 2021.

We plan to complete a 382 study for 2023, however, we do not expect any material limitations to the utilization of NOL’s or research and development credits.

Pursuant to Sections 382 and 383 of the IRC annual use of our NOL or research and development credit carryforwards may be limited in the event a cumulative change in ownership of more than 50% occurs within a three-year period.

We completed a study to assess whether an ownership change, as defined by IRC Section 382, has occurred from our formation through December 31, 2024.

We determined that an ownership change occurred in 2015, but concluded the annual utilization limitation would be sufficient to utilize our pre-ownership change NOLs and research and development credits prior to expiration.

Therefore we do not expect any material limitations to the utilization of NOL’s or research and development credits.

Future ownership changes may limit our ability to utilize remaining tax attributes.

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Due to the existence of the valuation allowance, future changes in our unrecognized tax benefits will not impact our effective tax rate.

Subsequent Events

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.

Segment Reporting

Our CODM manages our operations on an integrated basis for the purpose of allocating resources.

When evaluating our financial performance, the CODM regularly reviews total revenues, total expenses, and research and development expenses by project and the CODM makes decisions using this information.

The table below is a summary of the segment profit or loss, including significant expenses, in thousands:

Years Ended December 31,

Collaboration revenue

Ziftomenib-related costs

KO-2806-related costs

Tipifarnib-related costs

Discovery stage program-related costs

Research and development personnel costs and other expenses

Share-based compensation expense

Other segment expenses (1)

Total operating expenses

Other income (expenses)

Interest and other income, net

Interest expense

Income tax expense

Segment and net loss

(1) Other segment expenses are comprised of general and administrative expenses, excluding share-based compensation expense, which is shown separately.

Subsequent Event

On January 13, 2025, we entered into a lease agreement, or the Lease, with HCP Life Science REIT, Inc., or the Landlord, for the lease of approximately 32,512 square feet of rentable area of the building located at 4930 Directors Place, San Diego, California 92121, or the Premises.

The commencement date of the Lease is expected to be the earlier to occur of (i) the date upon which we first commence to conduct business in the Premises and (ii) October 1, 2025.

We expect to use the Premises as our new principal executive offices and for general office use, research and development, and laboratory uses.

The term of the Lease, or the Initial Term, is seven years and eight months and we have one option to extend the Lease for a period of five additional years.

The minimum rent payable by us under the Lease will be approximately $ 184,000 per month for the first year of the Lease, which amount will increase by 3.0 % per year over the Initial Term.

We will also be responsible for the payment of additional rent to cover our share of the annual operating expenses of the building, the annual tax expenses of the building and the annual utilities costs for the building, or the Additional Rent.

Pursuant to the Lease, Landlord shall provide us with (i) base rent abatement in the total amount not to exceed approximately $ 2.4 million to be applied as a credit against the rent payments due for months two through fourteen, inclusive and (ii) a tenant improvement allowance in an amount not to exceed $ 6.2 million, subject to certain conditions.

In the event of a default of certain of our obligations under the Lease, Landlord would have the right to terminate the Lease and recover certain unpaid rent and expenses.

We have the option to terminate the lease five years and six months into the Initial Term, or the Early Termination Date, by providing notice at least 12 months in advance of the Early Termination Date and paying an early termination fee equal to the rent, including Landlord’s estimate of Additional Rent, that otherwise would be due for the eight months following the Early Termination Date.

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 9A. Controls and Procedures