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Item 7. Management’s Discussion and Analysis

2026-02-26 compared with 2025-02-27 · 325 added, 190 removed, 1101 unchanged (32% of the section changed)

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You should review the section titled “Risk Factors” in Part I, Item 1A of this Annual Report on Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

We are a clinical-stage biopharmaceutical company dedicated to reinventing the treatment of human disease through the development of innovative, highly differentiated medicines that address significant health problems and that meaningfully improve patients’ lives.

We are a clinical-stage biopharmaceutical company dedicated to reinventing the treatment of human disease through the development of innovative, highly differentiated oral medicines that address significant health problems and meaningfully improve patients’ lives.

We are committed to advancing novel technologies to address targets that have known disease-causing biology, but which have not been drugged, or have been inadequately drugged, often based on limitations of existing technologies.

Our approach is intended to discover and develop a new generation of medicines in a disease-agnostic manner.

We are a leader in targeted protein degradation, or TPD, a next-generation small molecule therapeutic modality that engages the body’s natural cellular recycling system to selectively eliminate disease-causing proteins.

Our objective is to develop molecules that are both potent and highly selective, creating the potential for our medicines to uniquely address diseases that are poorly served by current treatment options.

To date, we have progressed five programs into clinical development and expect to advance at least one new molecular entity into clinical testing annually.

We are a leader in targeted protein degradation (TPD), a next-generation small molecule therapeutic modality that engages the body’s natural cellular recycling system to selectively eliminate disease-causing proteins.

Our objective is to develop molecules that are both potent and highly selective, creating the unique potential to address diseases that are poorly served by current treatment options.

To date, we have progressed multiple programs into clinical development and expect to advance at least one new molecular entity into clinical testing annually.

We intend to leverage our drug development expertise to become a fully integrated biopharmaceutical company with an industry-leading pipeline of novel medicines.

Our current focus is primarily directed at high-value targets in immunology.

We believe there are more than 160 million patients in the United States, Europe and Japan that are diagnosed with some of the most prevalent immune-inflammatory diseases that our programs are designed to address, nearly half of whom remain untreated.

Our current discovery and development efforts are primarily directed at high-value targets in immunology.

We believe there are more than 160 million patients in the United States, Europe and Japan that are diagnosed with some of the most prevalent immune-inflammatory diseases that our programs have the potential to address, nearly half of whom remain untreated.

Of those treated, most patients are treated with therapies that do not treat the underlying diseases but mostly their symptoms.

As a result, only a small percentage of patients, which we believe to be approximately 3% of the diagnosed population with severe inflammatory diseases, are currently treated with systemic advanced therapies, mostly injectable biologics.

As a result, only a small percentage of patients, which we believe to be approximately 3% of the diagnosed population with moderate to severe inflammatory diseases, are currently treated with systemic advanced therapies, mostly injectable biologics.

While generally efficacious, biologics have drawbacks.

Biologics tend to be more expensive to manufacture, and the cost is typically passed on to patients and payors.

Patient access to therapy can also be a challenge, as biologics are more complex to prescribe and reimburse than small molecule medicines.

Additionally, biologics are administered as injections, a less preferred route of administration for patients as compared to oral medications, which offer greater flexibility for patients.

Biologics tend to be more expensive to manufacture, and the cost burden ultimately falls on patients and payors.

Patient access to therapy can also be a challenge, as biologics can be more complex to prescribe and reimburse than small molecule medicines.

Additionally, biologics are administered as injections - which may result in injection site reactions or pain - a less preferred route of administration as compared to oral medications, which offer greater flexibility for patients.

We believe we have the potential to deliver a compelling value proposition to a significant underserved patient population:

small molecule medicines with biologics-like activity through the convenience of oral administration of a pill.

Our publicly disclosed immunology programs target STAT6, TYK2 and IRAK4, each of which addresses targets within validated pathways, providing the opportunity to treat a broad range of diseases.

We are developing KT-621 as part of our STAT6 program, which is currently being evaluated in a Phase 1 clinical trial in healthy volunteers.

Our lead molecule in our TYK2 program is KT-295, which we anticipate will enter the clinic in the second quarter of 2025.

We are collaborating with Sanofi S.A., or Sanofi, on the development of drug candidates targeting IRAK4, including KT-474/SAR444656, outside of oncology and immuno-oncology fields.

Sanofi has initiated two Phase 2b clinical trials of KT-474 in patients with hidradenitis suppurativa (HS) and in patients with atopic dermatitis (AD).

Our pipeline focuses on addressing high impact targets that have been elusive to conventional modalities and that drive the pathogenesis of multiple serious diseases with significant unmet medical needs.

small molecule medicines with biologics-like activity through the convenience of a daily, oral pill.

Our publicly disclosed immunology programs target STAT6, IRF5 and IRAK4, each of which addresses targets within validated pathways, providing the opportunity to treat a broad range of diseases.

We are developing KT-621 as part of our STAT6 program, and recently initiated the BROADEN2 Phase 2b clinical trial in adult and adolescent patients with moderate to severe Atopic Dermatitis (AD) and the BREADTH Phase 2b clinical trial in adult patients with moderate to severe asthma.

We are also developing KT-579 as part of our oral IRF5 degrader program, and we recently initiated a Phase 1 clinical trial in healthy volunteers.

We are collaborating with Sanofi S.A.

(“Sanofi”) on the development of our IRAK4 degrader, KT-485/SAR447971, which Sanofi plans to advance into clinical testing in 2026.

In June 2025, we announced a strategic collaboration with Gilead Sciences, Inc.

(“Gilead”) to develop novel oral molecular glue degraders for CDK2.

Our additional early undisclosed pipeline programs focus on addressing high impact targets that have been elusive to conventional modalities and that drive the pathogenesis of multiple serious diseases with significant unmet medical needs.

In addition to our immunology focus, we also have research initiatives in other therapeutic areas.

Additionally, we believe many of our key discovery and development capabilities have broad applicability, creating an opportunity for us to develop impactful therapeutics leveraging small-molecule modalities in addition to TPD.

Additionally, we believe many of our key discovery and development capabilities have broad applicability, creating an opportunity for us to develop impactful therapies leveraging small-molecule modalities in addition to TPD.

Since our inception in 2015, we have devoted substantially all our efforts to organizing and staffing our company, research and development activities, business planning, raising capital, building our intellectual property portfolio and providing general and administrative support for these operations.

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As of December 31, 2025, we had cash, cash equivalents and marketable securities of $1,619.4 million.

We believe the existing cash, cash equivalents and marketable securities on hand will be sufficient to fund our operations into mid 2027, which will enable us to execute on multiple data readouts across our programs.

We believe the existing cash, cash equivalents and marketable securities on hand will be sufficient to fund our operations into 2029.

We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect.

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To date, we have not generated any revenue from product sales and do not expect to generate any revenue from the sale of products in the foreseeable future.

Our only revenues have been derived from research collaboration arrangements with Vertex Pharmaceuticals Incorporated, or Vertex, and Sanofi.

We expect that our revenue for the next several years will be

derived primarily from our current collaboration agreements and any additional collaborations that we may enter into in the future.

Our only revenues have been derived from research collaboration arrangements with Vertex Pharmaceuticals Incorporated, or Vertex,, Sanofi and Gilead.

We expect that our revenue for the next several years will be derived primarily from our current collaboration agreements and any additional collaborations that we may enter into in the future.

To date, we have not received any royalties under any of the collaboration agreements.

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Sanofi Agreement

On July 7, 2020, we entered into a collaboration agreement, or the Sanofi Agreement, with Sanofi to co-develop drug candidates directed to two biological targets.

On July 7, 2020, we entered into a collaboration agreement, or the Original Sanofi Agreement, with Genzyme Corporation, a subsidiary of Sanofi, to co-develop drug candidates directed to two biological targets.

The Original Sanofi Agreement became effective during the third quarter of 2020.

On November 15, 2022, we entered into an Amended and Restated Collaboration and License Agreement with Sanofi, or the Amended Sanofi Agreement, which amended the Original Sanofi Agreement to revise certain research terms and responsibilities set forth under the Original Sanofi Agreement.

The Amended Sanofi Agreement also specifies details around the timing and number of Phase 2 trials required under the terms of the collaboration.

The Amended Sanofi Agreement became effective on December 5, 2022.

The Original Sanofi Agreement, as amended by the Amended Sanofi Agreement, is referred to herein as the Sanofi Agreement.

Under the Sanofi Agreement, we granted to Sanofi a worldwide exclusive license to develop, manufacture and commercialize certain lead compounds generated during the collaboration directed against IRAK4 and one additional undisclosed target in an undisclosed field of use.

Such license is exercisable on a collaboration target-by-collaboration target basis only after a specified milestone.

For compounds directed against IRAK4, the field of use includes diagnosis, treatment, cure, mitigation or prevention of any diseases, disorders or conditions, excluding oncology and immuno-oncology.

We are responsible for discovery and preclinical research and conducting a phase 1 clinical trial for at least one degrader directed against IRAK4 plus up to three backup degraders.

For compounds directed against IRAK4, the field of use includes diagnosis, treatment, cure, mitigation or prevention of any diseases, disorders or conditions, excluding oncology and immune-oncology.

Pursuant to the Sanofi Agreement, with respect to both targets we are responsible for discovery and preclinical research and conducting a phase 1 clinical trial for at least one degrader directed against IRAK4 plus up to three back up degraders, the costs of which will be borne by us, except in certain circumstances.

With respect to both targets, Sanofi is responsible for development, manufacturing, and commercialization of product candidates after a specified development milestone occurs with respect to each collaboration candidate.

We have an exclusive option, or Opt-In Right, exercisable on a collaboration-target-by-collaboration-target basis that will include the right to (i) to fund 50% of the United States development costs for collaboration products directed against such target in the applicable field of use and (ii) share equally in the net profits and net losses of commercializing collaboration products directed against such target in the applicable field of use in the United States.

In addition, if we exercise the Opt-In Right, Sanofi will grant us an exclusive option, applicable to each collaboration target, which upon exercise will allow us to conduct certain co-promotion activities in the field in the United States.

The Sanofi Agreement, unless earlier terminated, will expire on a product-by-product basis on the date of expiration of all payment obligations under the Sanofi Agreement with respect to such product.

We or Sanofi may terminate the agreement upon the other party’s material breach or insolvency or for certain patent challenges.

In addition, Sanofi may terminate the agreement for convenience or for a material safety event upon advance prior written notice, and we may terminate the agreement with respect to any collaboration candidate if, following Sanofi’s assumption of responsibility for the development, commercialization or manufacturing of collaboration candidates with respect to a particular target, Sanofi ceases to exploit any collaboration candidates directed to such target for a specified period.

In addition, pursuant to the Sanofi Agreement, Sanofi will grant to us an exclusive option, or Opt-In Right, exercisable, at our sole discretion, on a collaboration target-by-collaboration target basis that will include the right to (i) fund 50% of the United States development costs for collaboration products directed against such target in the applicable field of use and (ii) share equally in the net profits and net losses of commercializing collaboration products directed against such target in the applicable field of use in the United States.

In addition, if we exercise our Opt-In Right, Sanofi will grant to us an exclusive option, applicable to each collaboration target, which upon exercise will allow us to conduct certain co-promotion activities in the field in the United States.

In consideration for the exclusive licenses granted to Sanofi under the Sanofi Agreement, Sanofi paid to us an upfront payment of $150.0 million.

In addition to the upfront payment, under the agreement we were eligible to receive certain development milestone payments of up to $1.48 billion, and commercial milestone payments of up to $700.0 million, in the aggregate.

Of these milestones, we remain eligible to receive up to $1.0 billion in development milestones upon the achievement of certain developmental or regulatory events, and up to $400.0 million in commercial milestones which are payable upon the achievement of certain net sales thresholds, all of which are related to the IRAK4 program.

We will further be eligible to receive tiered royalties on net sales ranging from the high single digits to high teens, subject to low-single digits upward adjustments in certain circumstances.

As of December 31, 2024, we have achieved $55.0 million of milestones under the Sanofi Agreement related to certain IRAK4 clinical milestones.

The Amended Sanofi Agreement also specifies details around the timing and number of Phase 2 trials required under the terms of the collaboration.

The Amended Sanofi Agreement became effective on December 5, 2022.

Additionally with respect to Sanofi, on December 2, 2022, Sanofi provided the Company with written notice of its intention to advance the collaboration target 1 candidate, KT-474, into Phase 2 clinical trials for which the Company received milestone payments as further set forth in the Amended Sanofi Agreement.

Phase 2 clinical trials of KT-474 are initially investigating its potential in HS and AD with the clinical trial for both indications having been initiated and commenced dosing in 2023.

In September 2023, the Company and Sanofi mutually agreed to cease activities related to Collaboration Target 2.

We or Sanofi may terminate the agreement upon the other party’s material breach or insolvency or for certain patent challenges.

In December 2022, Sanofi provided us with written notice of its intention to take KT-474 into Phase 2 clinical trials.

In the fourth quarter of 2023, we achieved two milestones of $40.0 million and $15.0 million relating to the dosing of the first patient in the Phase 2 clinical trial for the first and second indications, respectively.

In the first quarter of 2025, we achieved a development milestone related to certain preclinical activities associated with the IRAK4 program.

In connection with this milestone we unconstrained $20.0 million of consideration in the first quarter of 2025.

All milestone payments have been received as of December 31, 2025.

In June 2025, Sanofi communicated its decision to exercise its full participation election under the terms of the companies’ collaboration agreement, and to advance KT-485/SAR447971, into clinical testing.

As a result, Sanofi stopped development of KT-474.

In connection with the IRAK4 program, we remain eligible to receive up to $975 million in development and commercial milestones upon the achievement of certain developmental or regulatory events and upon the achievement of certain net sales thresholds.

In September 2023, we mutually agreed to cease activities related to the undisclosed target and we are no longer eligible for the milestone and royalty payments associated with the second target.

Gilead Agreement

On June 25, 2025, we entered into an exclusive option and license agreement (the “Gilead Agreement”) with Gilead Sciences, Inc.

(“Gilead”), to collaborate on developing novel molecular glue degraders directed against cyclin-dependent kinase 2 (“CDK2”).

Under the Gilead Agreement, the Company granted to Gilead an exclusive option, exercisable during a defined option period, to exercise an exclusive, worldwide license to develop, manufacture, and commercialize certain CDK2 degraders generated under the collaboration.

Pursuant to the Gilead Agreement, we are responsible for all discovery and preclinical research activities through the delivery of a complete data package as defined in the agreement.

If, after receiving the complete data package, Gilead exercises its option to license the program, Gilead will have global rights to develop, manufacture and commercialize all products resulting from the collaboration.

If Gilead does not exercise the option during the option period defined in the agreement, then the Gilead Agreement will terminate.

Following option exercise, the Gilead Agreement will expire on a product-by-product and country-by-country basis upon the expiration of all royalty obligations under the agreement.

Gilead may terminate the agreement for convenience upon advance written notice.

Each party may also terminate the agreement for material breach, insolvency, and the agreement may be terminated for certain other customary reasons, including Gilead’s right to terminate certain provisions of the agreement following a change of control of our company.

In consideration for the exclusive option and rights granted under the Gilead Agreement, we received a non-refundable upfront payment of $40.0 million.

In addition, if Gilead exercises the option, we are entitled to receive an option exercise payment of $45.0 million and will be eligible to receive up to $665.0 million upon the achievement of certain development, regulatory and commercial milestones.

We are also eligible to receive tiered royalties on net sales by Gilead ranging from high single-digit to mid-teen percentages, subject to customary reductions in certain circumstances

Operating expenses

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Collaboration revenue

We recognize revenue under each of our collaboration agreements based on our pattern of performance related to the respective identified performance obligation, which is the period over which we will perform research services under each of the respective agreements.

We recognize revenue under each of our collaboration agreements based on our pattern of performance related to the respective identified performance obligations, which is the period over which we will perform research services under each of the respective agreements.

Collaboration revenues were $39.2 million for the year ended December 31, 2025, of which $33.6 million and $5.6 million were attributable to our collaboration agreements with Sanofi and Gilead, respectively.

Collaboration revenues were $47.1 million for the year ended December 31, 2024, the entirety of which was attributable to our collaboration agreement with Sanofi.

Collaboration revenues were $78.6 million for the year ended December 31, 2023, of which $8.4 million and $70.2 million were attributable to our collaboration agreements with Vertex and Sanofi, respectively.

The decrease in revenue is primarily attributable to the achievement of $55 million in milestones under the Sanofi agreement in the fourth quarter of 2023 and the associated cumulative catch-up of revenue at that time.

The decrease in revenue is primarily attributable to the satisfaction of the performance obligation under the Sanofi agreement in the second quarter of 2025, offset by revenue related to the Gilead agreement.

Research and development expenses

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Research and development expenses were $316.6 million for the year ended December 31, 2025, compared to $240.2 million for the year ended December 31, 2024.

The increase of $51.2 million was primarily due to an increase of $58.4 million in costs related to our STAT6, TYK2 and MDM2 programs, as well as an increase of $21.1 million in personnel, stock-based compensation and occupancy costs due to increases in employee headcount in our research and development functions.

These increases were partially offset by a $10.9 million reduction in activities related to our IRAK4 and STAT3 programs and a $17.4 million reduction in our other research and development costs due to stage progression and breakout of STAT6 and TYK2 programs.

The increase of $76.3 million was primarily due to an increase of $46.8 million in costs related to our STAT6 program, and increases of $14.4 million and $8.0 million, respectively, in personnel and stock-based compensation, and occupancy and overhead costs due to increases in employee headcount.

General and administrative expenses

General and administrative expenses were $68.2 million for the year ended December 31, 2025, compared to $63.5 million for the year ended December 31, 2024.

The $8.5 million increase was primarily due to a $7.0 million increase in personnel, stock-based compensation and occupancy costs due to increases in employee headcount in the general and administrative functions, and a $1.5 million increase in legal and professional services expenses to support our operations as a public company.

The $4.7 million increase was primarily due to a $3.7 million increase in employee compensation and occupancy costs, inclusive of stock-based compensation due to increases in employee headcount, and a $1.0 million increase in legal and professional services expenses to support our operations as a public company.

Impairment of long-lived assets

Impairment of long-lived assets was $4.9 million for the year ended December 31, 2024, compared to $0 for year ended December 31, 2023.

The increase of $4.9 million was as a result of the occupancy of the 2021 Lease facility in February of 2024 and the corresponding exit of the 2019 Lease facility, resulting in an impairment charge of $4.9 million in the year ended December 31, 2024.

Impairment of long-lived assets was $3.9 million for the year ended December 31, 2025, compared to $4.9 million for year ended December 31, 2024.

The decrease of $1.0 million was a result of the relative carrying values of the underlying asset that was impaired relative to the expected future cash flows.

Other Income, Net

Other income, net was $38.0 million for the year ended December 31, 2025, compared to $37.8 million for the year ended December 31, 2024.

The $19.2 million increase was primarily due to the increase in our investments balance as a result of 2024 financing activities as well as prevailing interest rates in the respective periods.

The $0.2 million increase was primarily due to the increase in our investments balance as a result of 2025 financing activities offset by a decrease in prevailing interest rates in the respective periods.

Results of Operations

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General and administrative

Impairment of long-lived assets

Total operating expenses

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Collaboration revenue

Collaboration revenues were $47.1 million for the year ended December 31, 2024, the entirety of which was attributable to our collaboration agreement with Sanofi.

The increase in revenue is primarily attributable to the achievement of $55 million in milestones under the Sanofi agreement in the fourth quarter of 2023.

Research and development expenses

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Research and development expenses were $240.2 million for the year ended December 31, 2024, compared to $189.1 million for the year ended December 31, 2023.

The increase of $24.8 million was primarily due to an increase of $19.5 million in personnel, stock-based compensation and occupancy costs due to increases in employee headcount in the research and development functions, a $9.9 million increase in other research and development expenses primarily associated with increased work on preclinical programs, as well as a $3.2 million increase in expenses on our STAT3 program due to the expenses associated with the Phase-1 clinical trial.

These increases were primarily offset by a $7.7 million reduction in direct expenses related to our activities for our IRAK4 and MDM2 programs due to changes in the stage of development of these respective programs.

The increase of $51.2 million was primarily due to an increase of $30.1 million in costs related to our clinical and preclinical programs, and increases of $10.9 million and $10.1 million respectively in personnel and stock-based compensation costs, and occupancy and overhead costs due to increases in employee headcount.

General and administrative expenses

General and administrative expenses were $63.5 million for the year ended December 31, 2024, compared to $55.0 million for the year ended December 31, 2023.

The $11.2 million increase was primarily due to a $8.8 million increase in personnel, stock-based compensation and occupancy costs due to increases in employee headcount in the general and administrative functions, and a $2.4 million increase in legal and professional services expenses to support our operations as a public company.

The $8.5 million increase was primarily due to a $7.0 million increase in personnel, stock-based compensation and occupancy costs due to increases in employee headcount, and a $1.5 million increase in legal and professional services expenses to support our operations as a public company.

Impairment of long-lived assets

Impairment of long-lived assets was $4.9 million for the year ended December 31, 2024, compared to $0 for year ended December 31, 2023.

Other Income, Net

Other income, net was $37.8 million for the year ended December 31, 2024, compared to $18.6 million for the year ended December 31, 2023.

The $12.2 million increase was primarily due to the prevailing interest rates in the respective periods.

The $19.2 million increase was primarily due to the increase in our investments balance as a result of 2024 financing activities as well as prevailing interest rates in the respective periods.

Liquidity and capital resources

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We agreed to pay Cowen a commission of up to 3.0% of the gross proceeds of any shares sold by Cowen under the Sales Agreement.

As of December 31, 2024, we have sold 1,519,453 shares of common stock under the Sales Agreement resulting in gross proceeds of approximately $50 million.

Through October 30, 2024, we sold 1,519,453 shares of common stock under the Sales Agreement resulting in gross proceeds of approximately $50 million.

On October 30, 2024, Cowen acknowledged and accepted our prior written notice to terminate the Cowen Sales Agreement, which termination was effective on October 30, 2024.

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Cash Flow used in Operating Activities

During the year ended December 31, 2025, operating activities used $232.9 million of cash, primarily resulting from our net loss of $311.4 million during the period.

These were partially offset by a $15.3 million net decrease in other operating assets and liabilities primarily driven by changes in deferred revenue, accounts payable, accrued expenses, operating lease liabilities as well as adjustments for non-cash items of $63.2 million (primarily consisting of stock-based compensation, lease impairment charge, depreciation & amortization and premiums & discounts on available-sale-securities).

During the year ended December 31, 2024, operating activities used $194.5 million of cash, primarily resulting from our net loss of $223.9 million during the period and a $41.1 million decrease in deferred revenue under our collaboration agreements.

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These were offset by a $11.2 million net decrease in other operating assets and liabilities primarily driven by changes in accounts receivable, accounts payable, accrued expenses, operating lease liabilities as well as adjustments for non-cash items of $41.5 million (primarily consisting of stock-based compensation, depreciation & amortization and premiums & discounts on available-sale-securities).

During the year ended December 31, 2022, operating activities used $153.1 million of cash, primarily resulting from our net loss of $154.8 million during the period and a $37.8 million decrease in deferred revenue under our collaboration agreements.

These were offset by adjustments for non-cash items of $39.3 million (primarily consisting of stock-based compensation, depreciation and amortization and premiums and discounts on available sale-securities) and a $0.2 million net increase in operating assets and liabilities primarily driven by changes in accounts payable and accrued expenses partially offset by changes in prepaid expenses and other operating assets and liabilities.

Cash Flow provided by (used in) Investing Activities

During the year ended December 31, 2025, cash used in investing activities was $521.1 million comprised of purchases of marketable securities of $1,007.6 million and purchases of property and equipment of $1.5 million partially offset by maturities of marketable securities of $488.0 million.

During the year ended December 31, 2023, cash provided by investing activities was $139.9 million comprised of maturities of marketable securities of $363.5 million partially offset by purchases of marketable securities of $189.2 million and purchases of property and equipment of $34.4 million.

During the year ended December 31, 2024, cash used in investing activities was $404.1 million comprised of purchases of marketable securities of $901.2 million and purchases of property and equipment of $12.8 million partially offset by maturities of marketable securities of $509.9 million.

Cash Flow from Financing Activities

During the year ended December 31, 2025, net cash provided by financing activities was $990.7 million, consisting of $928.9 million in proceeds from issuance of common stock and accompanying pre-funded warrants, net of offering costs, $61.6 million in proceeds from the exercise of employee stock options, $1.7 million from proceeds from the employee stock purchase plan, partially offset by finance lease payments of $1.5 million.

During the year ended December 31, 2024, net cash provided by financing activities was $608.9 million, consisting of $547.9 million in proceeds from issuance of common stock and accompanying pre-funded warrants, net of offering costs, $48.7 million in proceeds from the issuance of common stock through the Cowen Sales Agreement, net of issuance costs, $11.8 million in proceeds from the exercise of employee stock options, $2.0 million from proceeds from the employee stock purchase plan, partially offset by finance lease payments of $1.6 million.

During the year ended December 31, 2023, net cash provided by financing activities was $4.2 million, primarily consisting of $2.9 million in proceeds from the exercise of employee stock options, $1.4 million in proceeds from the issuance of shares under our employee stock purchase partially offset by finance lease payments of $0.1 million.

During the year ended December 31, 2022, net cash provided by financing activities was $153.0 million, primarily consisting of $149.8 million of net proceeds received in our August 2022 PIPE offering, $3.2 million in proceeds from the exercise of employee stock options, $1.1 million in proceeds from the issuance of shares under our employee stock purchase partially offset by finance lease payments of $1.1 million.

Future funding requirements

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• our need to implement additional internal systems and infrastructure, including financial and reporting systems.

We believe the existing cash, cash equivalents and marketable securities of $850.9 million as of December 31, 2024, will be sufficient to fund our operations into mid 2027.

We believe the existing cash, cash equivalents and marketable securities of $1,619.4 million as of December 31, 2025, will be sufficient to fund our operations into 2029.

We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect.

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If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, reduce or eliminate our product development or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

As of December 31, 2025, we had outstanding pre-funded warrants to purchase 15,815,253 shares of common stock, each with an exercise price of $0.0001 per share.

These warrants can be exercised at any time at the discretion of the holders, subject to certain ownership limitations.

While the potential exercise of these pre-funded warrants would result in the issuance of additional shares, thus increasing the total shares outstanding, their nominal exercise price means they are already considered outstanding for purposes of calculating our weighted average common stock outstanding and earnings per share.

Due to the minimal exercise price, we do not anticipate significant additional cash proceeds upon exercise and consequently does not expect the exercise of these warrants to materially affect its liquidity, capital resources, or overall financial condition.

Contractual Obligations and Other Commitments

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When combined performance obligations contain a promised license and related services or other promises, management judgment is required to determine the appropriate timing of revenue recognition.

In doing so, we must identify the predominant promise or promises in the contract to determine whether revenue is recognized at a point in time or over time.

In doing so, we must identify the predominant promise or promises

in the contract to determine whether revenue is recognized at a point in time or over time.

If over time, we must determine the appropriate measure of progress.

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We measure equity-based awards granted to employees, directors, and nonemployees based on their fair value on the date of the grant and recognize compensation expense for those awards over the requisite service period, which is generally the vesting period of the respective award.

The equity-based payments include stock options and grants of common stock, including common stock subject to vesting.

The equity-based payments include grants of stock options and restricted stock units.

The measurement date for equity awards is the date of grant, and equity-based compensation costs are recognized as expense over the requisite service period, which is the vesting period, on a straight-line basis.

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The expected dividend yield is assumed to be zero as we have no current plans to pay any dividends on common stock.

We have performance conditions included in certain of our restricted stock units and stock options that are based upon the achievement of pre-specified clinical development milestones.

As the outcome of each event has inherent risk and uncertainties, and a positive outcome may not be known until the event is achieved, we begin to recognize the grant-date fair value of the performance-based restricted stock awards when we determine the achievement of each performance condition is deemed probable, a determination which requires significant judgment by management.

On the date the performance condition is deemed probable, we record a cumulative expense catch-up, with remaining expense amortized over the remaining service period.

We reassess the probability of achievement at each reporting period and adjust cumulative expense as necessary.

Quantitative and Qualitat ive Disclosures About Market Risk.

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The communication of the critical audit matter does not alter in any way our opinion on the consolidated 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.

Collaboration Arrangement

Collaborations - Gilead Arrangement

Description of

As discussed in Note 5 to the consolidated financial statements, the Company recognizes revenue associated with each performance obligation as the research and development services are provided using an input method, according to costs incurred as related to the research and development activities for each individual program and the costs expected to be incurred in the future to satisfy that individual performance obligation.

As discussed in Note 5 to the consolidated financial statements for the Gilead Agreement, the Company recognizes revenue associated with each performance obligation as the research and development services are provided using an input method, according to costs incurred related to the research and development activities for each individual program and the costs expected to be incurred in the future to satisfy that individual performance obligation.

The amounts received that have not yet been recognized as revenue are deferred as a contract liability on the Company’s consolidated balance sheet.

For the year ended December 31, 2024, the Company has recognized $47.1 million in collaboration revenue.

Auditing the Company's accounting for revenues from collaboration arrangement was complex and required significant judgments primarily in evaluating estimates of the total expected costs under the input method for revenue recognized over time.

Auditing the progress toward completion of the collaboration arrangement was especially challenging because it involves subjective management assumptions used in estimating the remaining research and development costs necessary to satisfy the performance obligation.

For the year ended December 31, 2025, the Company has recognized $5.6 million in Gilead Agreement collaboration revenue.

Auditing the Company's accounting for revenues from this collaboration arrangement was complex and required significant judgments primarily in evaluating estimates of the total expected costs under the input method for revenue recognized over time.

Auditing the progress toward completion of this collaboration arrangement was especially challenging because it involves subjective management assumptions used in estimating the remaining research and development costs necessary to satisfy the performance obligation.

The calculation of the total remaining estimated research and development cost includes forecasted costs associated with internal employee efforts, materials costs, and third-party contract costs.

The recognition of revenue pursuant to collaboration arrangements is subject to these judgments made and estimates developed by management and is sensitive to changes in these assumptions.

The recognition of revenue pursuant to this collaboration arrangement is subject to these judgments made and estimates developed by management and is sensitive to changes in these assumptions.

How We Addressed the Matter in Our Audit

We evaluated and tested the design and operating effectiveness of internal controls over the Company’s process for developing the estimate, including controls to assess the completeness and accuracy of the data that supports management’s estimates.

To test the Company’s collaboration revenue, we performed audit procedures that included, among others, reading the collaboration arrangement and testing the accuracy and completeness of the underlying data used in evaluating the estimates and significant judgments described above.

To test the Company’s Gilead collaboration revenue, we performed audit procedures that included, among others, reading the collaboration arrangement and testing the accuracy and completeness of the underlying data used in evaluating the estimates and significant judgments described above.

To assess the reasonableness of the Company's significant estimates and judgments, we compared cost estimates to costs previously incurred for similar activities, evaluated the remaining estimated level of effort required to complete the services, and inspected evidence of actual costs incurred.

We also discussed the basis for key assumptions with the Company's research and development personnel, who oversee the completion of the collaboration arrangement.

We also discussed the basis for key assumptions with the Company's research and development personnel, who oversee the completion of this collaboration arrangement.

/s/ Ernst & Young LLP

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Marketable securities (Note 4)

Accounts receivable

Contract assets

Prepaid expenses and other current assets

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Finance lease liabilities, net of current portion

Other non-current liabilities

Total liabilities

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Stockholders’ equity:

Preferred stock, $ 0.0001 par value;

10,000,000 shares authorized as of December 31, 2025

0 shares issued and outstanding as of December 31, 2025 and 2024, respectively

Common stock, $ 0.0001 par value;

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Accumulated deficit

Accumulated other comprehensive loss

Accumulated other comprehensive income (loss)

Total stockholders’ equity

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Other comprehensive loss:

Unrealized (loss) gain on marketable securities

Unrealized gain (loss) on marketable securities

Total comprehensive loss

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Balance at December 31, 2022

Issuance of Common Stock and accompanying pre-funded

warrants at Private Placement, net of issuance cost of $ 174

Exercise of Stock Options

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Stock-based compensation expense

Unrealized loss on marketable securities

Unrealized gain on marketable securities

Balance at December 31, 2023

Issuance of common stock and accompanying pre-funded warrants from January 2024 public offering, net of issuance costs of $ 14,877

Issuance of common stock through At-The Market Sales Agreement, net of issuance costs of $ 1,249

Issuance of common stock and accompanying pre-funded warrants from August 2024 public offering, net of issuance costs of $ 12,237

Exercise of Stock Options

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Stock-based compensation expense

Unrealized gain on marketable securities

Unrealized loss on marketable securities

Balance at December 31, 2024

Issuance of common stock and accompanying pre-funded warrants from January 2024 public offering, net of issuance costs of $ 14,877

Issuance of common stock through At-The Market Sales Agreement, net of issuance costs of $ 1,249

Issuance of common stock and accompanying pre-funded warrants from August 2024 public offering, net of issuance costs of $ 12,237

Issuance of common stock and accompanying pre-funded warrants from June 2025 public offering, net of issuance costs of $ 15.7 million

Issuance of common stock from December 2025 public offering, net of issuance costs of $ 36.2 million

Exercise of Stock Options

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Stock-based compensation expense

Lease impairment charge

Impairment of long-lived assets

Depreciation and amortization

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Maturities of marketable securities

Net cash provided by (used in) investing activities

Net cash (used in) provided by investing activities

Financing activities

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Issuance of common stock and accompanying pre-funded warrants from August 2024 public offering, net of issuance costs of $ 12.2 million

Proceeds from 2022 issuance of common stock and accompanying pre-funded warrants from private placement, net of issuance costs of $ 0.2 million

Issuance of common stock and accompanying pre-funded warrants from June 2025 public offering, net of issuance costs of $ 15.7 million

Issuance of common stock from December 2025 public offering, net of issuance costs of $ 36.2 million

Proceeds from stock option exercises

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If the Company fails to obtain additional future capital, it may be unable to complete its planned preclinical studies and clinical trials.

Private Investment in Public Equity “PIPE” offering

On August 18, 2022, the Company and certain accredited investors entered into a securities purchase agreement pursuant to which the Company agreed to sell and issue to such investors in a private placement (i) an aggregate of 2,769,228 shares of the Company’s common stock at a purchase price of $ 26.00 per share, and (ii) 3,000,000 pre-funded warrants to purchase common stock, at a purchase price of $ 25.9999 per Pre-Funded Warrant.

The Pre-Funded Warrants have an exercise price of $ 0.0001 per share of common stock.

The offering closed on August 22, 2022, resulting in net proceeds of $ 149.8 million after offering expenses.

2024 Follow-on Public Offerings

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The aggregate gross proceeds before deducting underwriting discounts and commissions, and other estimated offering expenses payable by the Company were approximately $ 258.7 million.

2025 Follow-on Public Offerings

On June 30, 2025, the Company issued and sold 5,044,500 shares of common stock at a public offering price of $ 44.00 per share.

Additionally, in lieu of common stock to a certain investor, the Company issued and sold pre-funded warrants to purchase 655,500 shares of common stock at a public offering price of $ 43.9999 per pre-funded warrant, which represents the public offering price per share of common stock less the $ 0.0001 per share exercise price of each pre-funded warrant.

The aggregate gross proceeds from this initial closing, before deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company, were approximately $ 250.8 million.

In July 2025, the Company completed the follow-on offering through the closing of the underwriters’ full exercise of their option to purchase an additional 855,000 shares of common stock.

As a result, the total aggregate gross proceeds from this follow-on offering were approximately $ 288.4 million, before deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company.

On December 10, 2025, the Company completed a follow-on offering of its common stock.

The Company issued and sold 8,050,000 shares of common stock, including full exercise of the underwriters’ over-allotment option to purchase an additional 1,050,000 shares, at a public offering price of $ 86.00 per share.

The aggregate gross proceeds before deducting underwriting discounts and commissions, and other estimated offering expenses payable by the Company were approximately $ 692.3 million.

Pre-funded warrants

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In recording transactions and balances resulting from business operations, management makes estimates based on the best information available at the time the estimate is made.

Significant estimates relied upon in preparing these financial statements include revenue recognized under our collaboration agreements, accrual for research and development expenses, and equity-based compensation expense.

As better information becomes available or actual amounts are determinable, the recorded estimates are revised.

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Available-for-sale securities are maintained by investment managers and consist of U.S.

Treasury securities, U.S Government Agency securities, and corporate bonds.

Available-for-sale securities are carried at fair value with the unrealized gains and losses included in other comprehensive income (loss) as a component of stockholders’ equity until realized.

Treasury securities, U.S Government Agency securities, and corporate securities, including commercial paper.

Available-for-sale securities are carried at fair value with the unrealized gains and losses included in accumulated other comprehensive income (loss) as a component of stockholders’ equity until realized.

Any premium or discount arising at purchase is amortized and/or accreted to interest income and/or expense over the life of the instrument.

Realized gains and losses are determined using the specific identification method and are included in other (expense) income, net.

Realized gains and losses are determined using the specific identification method and are included in other income (expense), net.

At each reporting date, the Company performs an evaluation of impairment to determine if any unrealized losses are the result of credit losses.

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The impairment loss would be based on the excess of the carrying value of the impaired asset over its fair value, determined based on discounted cash flows.

During the year ended December 31, 2024, the Company recorded an impairment loss of $ 4.9 million related to its move into its new corporate headquarters and its subsequent effort to sublease the previous space.

The Company did no t record any impairment losses on long-lived assets during the years ended December 31, 2023 and 2022.

During the years ended December 31, 2025 and December 31, 2024, the Company recorded impairment losses related to its move into its new corporate headquarters and its subsequent effort to sublease the previous space of $ 3.9 million and $ 4.9 million, respectively.

The Company did no t record any impairment losses on long-lived assets during the years ended December 31, 2023.

The Company determines the accounting classification of warrants that are issued, as either liability or equity, by first assessing whether the warrants meet liability classification in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity , and then in accordance with ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock .

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After consummation of the financing, these costs are recorded as a reduction of the proceeds received from the financing.

If a planned financing is abandoned, the deferred offering costs are expensed immediately as a charge to operating expenses in the consolidated statement of operations and comprehensive loss.

If a planned financing is abandoned, the deferred offering costs are expensed immediately as a charge to operating expenses in the consolidated

statement of operations and comprehensive loss.

There was no deferred offering costs on the Company’s consolidated balance sheet at December 31, 2025 and December 31, 2024.

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In validating its estimated stand-alone selling prices, the Company evaluates whether changes in the key assumptions used to determine its estimated stand-alone selling prices will have a significant effect on the allocation of arrangement consideration between performance obligations.

The Company estimates the transaction price based on the amount of consideration the Company expects to be received for transferring the promised goods or services in the contract.

The Company estimates the transaction price based on the amount of consideration the Company expects to receive for transferring the promised goods or services in the contract.

The consideration may include both fixed consideration and variable consideration.

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The Company accounts for all stock-based awards granted to employees, directors, and nonemployees based on their fair value on the date of the grant and recognizes compensation expense for those awards over the requisite service period, which is generally the vesting period of the respective award.

Stock-based payments include stock options and grants of common stock, including common stock subject to vesting.

Stock-based payments include grants of stock options and restricted stock units.

The measurement date for stock awards is the date of grant, and stock-based compensation costs are recognized as expense over the requisite service period, which is the vesting period, on a straight-line basis.

The Company has issued stock options and restricted stock with performance-based vesting conditions and records the expense for these awards if the Company concludes that it is probable that the performance condition will be achieved.

The Company has issued stock options and restricted stock units with performance-based vesting conditions and records the expense for these awards if the Company concludes that it is probable that the performance condition will be achieved.

Stock-based compensation is classified in the accompanying consolidated statements of operations and comprehensive loss based on the function to which the related services are provided.

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expect to pay any cash dividends in the foreseeable future.

The fair value of each restricted common stock award is estimated on the date of grant based on the fair value of the Company’s common stock on that same date.

The fair value of each restricted stock unit award is estimated on the date of grant based on the fair value of the Company’s common stock on that same date.

Compensation expense for discounted purchases under the employee stock purchase plan is measured using the Black-Scholes model to compute the fair value of the lookback provision plus the purchase discount and is recognized as compensation expense over the offering period.

We have performance conditions included in certain of our restricted stock units awards and stock options that are based upon the achievement of pre-specified clinical development milestones.

On the date the performance condition is deemed probable, we record a cumulative expense catch-up, with remaining expense amortized over the remaining service period.

We reassess the probability of achievement at each reporting period and adjust cumulative expense as necessary .

The Company records income taxes in accordance with FASB Accounting Standards Codification Topic 740, Income Taxes, or ASC 740, which provides for deferred taxes using an asset and liability approach.

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Comprehensive Loss

Comprehensive loss includes net loss as well as unrealized gains and losses on marketable securities and other changes in stockholders’ equity (deficit) that result from transactions and economic events other than those with stockholders.

Comprehensive loss includes net loss as well as unrealized gains and losses on marketable securities and other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders.

Net Loss Per Share

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Diluted net income (loss) per share attributable to common stockholders is computed by dividing the diluted net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period, including potential dilutive common shares.

For purpose of this calculation, outstanding options to purchase common stock, unvested restricted stock awards, and shares of convertible preferred stock are considered potential dilutive common shares.

For purpose of this calculation, outstanding options to purchase common stock, unvested restricted stock units, and shares of convertible preferred stock are considered potential dilutive common shares.

The Company has generated a net loss in all periods presented, and therefore the basic and diluted net loss per share attributable to common stockholders are the same as the inclusion of the potentially dilutive securities would be anti-dilutive.

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Recently Issued Accounting Standards

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which requires entities to disclose disaggregated information about their effective tax rate reconciliation as well as expanded information on income taxes paid by jurisdiction.

The disclosure requirements will be applied on a prospective basis, with the option to apply them retrospectively.

The standard is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

We are currently evaluating the disclosure requirements related to this new standard.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, which is intended to improve disclosures by requiring additional information about specific expense categories in the notes to the financial statements on an annual and interim basis.

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Recently Adopted Accounting Standards

In November 2023, the FASB issued ASU 2023-07, Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements, primarily through additional disclosures about significant segment expenses.

The standard became effective for us in the fourth quarter of 2024.

Please refer to Note 14, Segment Information, for additional disclosures related to this new standard.

The disclosure requirements will be applied on a prospective basis, and became effective for us in the fourth quarter of 2025.

Please refer to Note 12, Income Taxes, for additional disclosures related to this new standard .

Fair Value Measurements

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Money market fund

US treasuries

US government agencies

Commercial Paper

Corporate bonds

Marketable securities, current

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US treasuries

Commercial Paper

US government agencies

Marketable securities, current

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US government agencies

Commercial Paper

Corporate bonds

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December 31, 2024

treasury securities

US government agency securities

US treasury securities

US government agencies

Commercial Paper

Corporate securities

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Collaborations

Gilead Agreement

Agreement Terms

On June 25, 2025, the Company entered into an exclusive option and license agreement (the “Gilead Agreement”) with Gilead Sciences, Inc.

(“Gilead”), to collaborate on developing novel molecular glue degraders directed against cyclin-dependent kinase 2 (“CDK2”).

Pursuant to the Gilead Agreement, the Company is responsible for all discovery and preclinical research activities through the delivery of a complete data package as defined in the agreement.

If Gilead does not exercise the option during the option period defined in the agreement, then the Gilead Agreement will terminate.

Following option exercise, the Gilead Agreement will expire on a product-by-product and country-by-country basis upon the expiration of all royalty obligations under the agreement.

Gilead may terminate the agreement for convenience upon advance written notice.

In consideration for the exclusive option and rights granted under the Gilead Agreement, the Company received a non-refundable upfront payment of $ 40.0 million.

In addition, if Gilead exercises the option, the Company is entitled to receive an option exercise payment of $ 45.0 million and will be eligible to receive up to $ 665.0 million upon the achievement of certain development, regulatory and commercial milestones.

The Company is also eligible to receive tiered royalties on net sales by Gilead ranging from high single-digit to mid-teen percentages, subject to customary reductions in certain circumstances.

Accounting Treatment

The Company evaluated the Gilead Agreement under ASC 606, Revenue from Contracts with Customers, and determined that the arrangement represents a contract with a customer.

The Company identified the following material promises under the Gilead Agreement:

(1) the discovery and preclinical research activities and (2) an option granting Gilead the right to acquire an exclusive license to the program.

The option to acquire an exclusive license to the program was evaluated as a material right.

The Company determined that the option to acquire an exclusive license in the future was not priced at a discount, and that the option exercise fee is at or above the standalone selling price for research at this stage of development;

as such, the options and the underlying licenses are excluded from the performance obligation and the option exercise fees are excluded from the transaction price until the underlying option is exercised.

That is, one performance obligation was identified, the discovery and preclinical research activities.

The Company determined the total transaction price to be $ 40.0 million, which represents the upfront payment.

The option exercise payment and all future milestone and royalty payments are excluded from the initial transaction price as they are contingent on future events and were deemed constrained due to the uncertainty of achievement and the Company’s limited control over their occurrence.

The Company recognizes revenue associated with the performance obligation as the discovery and preclinical research activities are provided using an input method, according to costs incurred and the costs expected to be incurred in the future to satisfy that individual performance obligation.

The transfer of control occurs over this time period and, in management’s judgment, is the best measure of progress towards satisfying each performance obligation.

For the year ended December 31, 2025, the Company recognized $ 5.6 million in revenue under the Gilead Agreement.

In the years ended December 31, 2024 and December 31, 2023, the Company did no t recognize any revenue under the Gilead Agreement.

The aggregate amount of the transaction price allocated to the Company’s unsatisfied performance obligations and recorded in deferred revenue as of December 31, 2025 and December 31, 2024 was $ 34.4 million and $ 0 , respectively.

This increase was the result of an increase of $ 40.0 million from the entering into of the agreement in the second quarter of 2025 partially offset by the revenue recognized in the year ended December 31, 2025.

The remaining deferred revenue of $ 34.4 million will be recognized over the remainder of the estimated research period, which is expected to conclude within the next 1.3 years.

All option and milestone payments were constrained as the achievement of such milestones are contingent upon the success of the underlying research and development activities and are generally outside the control of the Company.

Any amounts related to the option exercise fee or milestone payments will be included in the transaction price and recognized on a cumulative catch-up basis when the risk of revenue reversal is resolved.

Royalties and commercial milestone payments, if any, will be recognized at the later of when the related sales occur or when the associated performance obligation has been satisfied.

Sanofi Collaboration Arrangement

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In addition to the upfront payment, under the agreement we were eligible to receive certain development milestone payments of up to $ 1.48 billion, and commercial milestone payments of up to $ 700.0 million, in the aggregate.

Of these milestones, we remain eligible to receive up to $ 1.0 billion in development milestones upon the achievement of certain developmental or regulatory events, and up to $ 400 million in commercial milestones which are payable upon the achievement of certain net sales thresholds, all of which are related to the IRAK4 program.

We will further be eligible to receive tiered royalties on net sales ranging from the high single digits to high teens, subject to low-single digits upward adjustments in certain circumstances.

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In the fourth quarter of 2023, the Company achieved two milestones of $ 40.0 million and $ 15.0 million relating to the dosing of the first patient in the Phase 2 clinical trial for the first and second indications, respectively.

Further, in July 2024, the Company announced that Sanofi intends to expand the ongoing Phase 2 trials to more rapidly progress towards pivotal studies with the intention of accelerating overall timelines.

In the first quarter of 2025, the Company achieved a development milestone related to certain preclinical activities associated with the IRAK4 program.

In connection with this milestone the Company unconstrained $ 20.0 million of consideration in the first quarter of 2025.

In September 2023, the Company and Sanofi mutually agreed to cease activities related to Collaboration Target 2.

As a result, Sanofi intends to stop development of KT-474.

In connection with the IRAK4 program, the Company remains eligible to receive up to $ 975 million in development and commercial milestones upon the achievement of certain developmental or regulatory events and upon the achievement of certain net sales thresholds.

Accounting Treatment

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$ 30.0 million

The Company determined the allocation of the $ 150.0 million transaction price between Collaboration Target 1 and Collaboration Target 2 based on the value of the research and development for the programs from projected research and development costs for each collaboration target plus a developer’s profit and the total potential milestones for each collaboration target.

The Company recognizes revenue associated with each performance obligation as the research and development services are provided using an input method, according to costs incurred as related to the research and development activities for each individual program and the costs expected to be incurred in the future to satisfy that individual performance obligation.

The transfer of control occurs over this time period and, in management’s judgment, is the best measure of progress towards satisfying each performance obligation.

The amounts received that have not yet been recognized as revenue are deferred as a contract liability on the Company’s consolidated balance sheet and will be recognized over the remaining research and development period until the performance obligation is satisfied.

Milestone and reimbursement consideration added to the transaction price will be recognized as revenue with a cumulative catch-up upon becoming unconstrained.

The performance obligation associated with Collaboration Target 1 has not been fully satisfied as of December 31, 2024.

The performance obligation associated with Collaboration Target 2 has been fully satisfied.

D uring the year ended December 31, 2024, the Company recognized $ 47.1 million in revenue under the Sanofi Agreement all of which was associated with Collaboration

With Sanofi's exercise of its full participation election under the agreement for Collaboration Target 1, the performance obligations associated with Collaboration Target 1 & Collaboration Target 2 have been fully satisfied as of December 31, 2025.

D uring the year ended December 31, 2025, the Company recognized $ 33.6 million in revenue under the Sanofi Agreement all of which was associated with Collaboration Target 1.

Of the $ 33.6 million of revenue recognized in the year ended December 31, 2025, $ 13.6 million was recognized from amounts that were recorded in deferred revenue as of December 31, 2024.

The aggregate amount of the transaction price allocated to the Company’s unsatisfied performance obligations and recorded in deferred revenue at December 31, 2024 is $ 13.6 million.

During the year ended December 31, 2024, the Company recognized $ 47.1 million, all of which was associated with Collaboration Target 1.

The aggregate amount of the transaction price allocated to the Company’s unsatisfied performance obligations and recorded in deferred revenue at December 31, 2024 was $ 13.6 million.

The decrease in deferred revenue between December 31, 2025 and December 31, 2024 is the result of the full satisfaction of the performance obligation for Collaboration 1 occurring in the year ended December 31, 2025.

During the year ended December 31, 2023, the Company recognized $ 70.2 million in revenue under the Sanofi Agreement, of which $ 67.7 million was associated with Collaboration Target 1 and $ 2.5 million was associated with Collaboration Target 2.

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The decrease in deferred revenue between December 31, 2024 and December 31, 2023 is the result of on-going activity under the collaboration agreement as well as a $ 19.4 million cumulative catch-up to revenue related to the change in expected future costs to satisfy the Company’s performance obligation under Collaboration Target 1.

During the year ended December 31, 2022, the Company recognized $ 36.0 million in revenue under the Sanofi Agreement, of which $ 19.4 million was associated with Collaboration Target 1 and $ 16.6 million was associated with Collaboration Target 2.

During the years ended December 31, 2025 and 2024, the Company received $ 1.3 million and $ 8.8 million, respectively, in cost reimbursement payments under the Sanofi Agreement.

The Company recorded $ 0.0 million and $ 0.9 million of unbilled accounts receivable related to reimbursable research and development costs under the Sanofi Agreement as of December 31, 2025 and December 31, 2024, respectively.

The Company will recognize the deferred revenue related to the performance obligations based on a cost input method, as described, over the remaining research term, which as a result of the amended agreement, is a maximum of approximately 0.5 years as of December 31, 2024.

Any additional consideration related to performance-based milestones will be recognized when the risk of probable reversal is resolved, at which point the Company shall adjust the transaction price determined for the agreement accordingly and recognize revenue on a cumulative-catch up basis, reallocating the revised arrangement consideration to the performance obligations.

Any consideration related to sales milestone payments and royalties will be recognized when the related milestone events or sales occur and therefore are recognized at the later of when the related sales occur or the relevant performance obligation is satisfied.

As part of its evaluation of constraining the milestones, the Company considered numerous factors, including the fact that the achievement of the research and development milestones are contingent upon the results of the underlying research and development activities and are thus outside of the control of the Company.

In the fourth quarter of 2023, the Company achieved two development milestones relating to the dosing of the first patient in the KT-474 Phase 2 clinical trials for the first and second indications, respectively.

In connection with these milestones the Company unconstrained $ 55.0 million of consideration resulting in a $ 40.3 million cumulative catch up recorded to revenue with the remaining $ 14.7 million recorded as deferred revenue as of December 31, 2023.

As of December 31, 2024, $ 51.4 million of the $ 55.0 million of consideration has been recorded as revenue, with the remaining $ 3.6 million recorded as deferred revenue.

In connection with these milestones the Company unconstrained $ 55.0 million of consideration in the fourth quarter of 2023.

In the first quarter of 2025, the Company achieved a development milestone related to certain preclinical activities associated with the IRAK4 program.

During the year ended December 31, 2025, the Company recognized $ 23.6 million of revenue from the unconstrained milestones.

As of December 31, 2025, all of the $ 75.0 million of consideration has been recorded as revenue.

Vertex Agreement

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and (3) the option to license each of the targets for development, manufacturing, and commercialization efforts.

The research and development services

were determined not to be distinct from the research and development license and have been combined into a single performance obligation.

The Company determined that the option to license the targets in the future was not priced at a discount, and that the option exercise fee for each target is at or above the standalone selling price for research at this stage of development;

The research and development services were determined not to be distinct from the research and development license and have been combined into a single performance obligation.

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Accordingly, the Company fully satisfied its performance obligation and recognized all remaining deferred revenue associated with the Vertex collaboration in May 2023.

The Company did no t recognize any revenue under the Vertex agreement during the year ended December 31, 2024.

During the years ended December 31, 2023 and 2022, the Company recognized $ 8.4 million, $ 10.8 million, respectively, in revenue under the Vertex Agreement.

The Company did no t recognize any revenue under the Vertex agreement during the years ended December 31, 2025 or 2024 and recognized $ 8.4 million during the year ended December 31, 2023.

The following table presents the changes in accounts receivable, contract assets and liabilities for the year ended December 31, 2025 (in thousands):

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Unbilled receivables – Sanofi

Billed receivables – Gilead

Total accounts receivable and contract assets

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Deferred Revenue – Sanofi

Deferred Revenue - Gilead

Total contract liabilities

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Leasehold improvements

Assets not yet in service

Total property and equipment

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The Company concluded the improvements paid for by the landlord in connection with the tenant improvement allowance represent lessee assets and therefore recorded $ 20.1 million of leasehold improvements in property and equipment.

The Company recorded an additional $ 17.9 million of leasehold improvements in excess of the tenant improvement allowance, all of which were placed in service as of December 31, 2024.

The Company recorded an additional $ 17.9 million of leasehold improvements in excess of the tenant improvement allowance, all of which were placed in service.

Upon occupancy of the 2021 Lease facility in February of 2024 , the Company exited the 2019 Lease facility and is actively looking to sublease the entire facility for the remaining noncancellable lease term through March 31, 2030.

These actions resulted in an impairment charge of $ 4.9 million in the year ended December 31, 2024.

The Company continues to evaluate the potential recovery of the ROU asset under sublease scenarios, and thus it is possible that additional impairments could be identified in future periods, and such amounts could be material.

The impairment charge reduces the carrying value of the associated ROU asset, leasehold improvements and certain furniture and fixture assets that remained in the facility to their estimated fair values.

The fair values were estimated using a discounted cash flows approach based on forecasted future cash flows expected to be derived from the property based on current sublease market rent, which is considered a level 3 input in the fair value hierarchy, and other key assumptions such as future sublease market conditions and the discount rate.

These actions have resulted in impairment charges of $ 3.9 million and $ 4.9 million in the years ended December 31, 2025 and 2024, respectively.

The Company continues to evaluate the potential recovery of the ROU asset under sublease scenarios, and thus it is possible that additional impairments could be identified in future periods.

The impairment charges reduced the carrying value of the associated ROU asset, leasehold improvements and certain furniture and fixture assets that remained in the facility to their estimated fair values.

Fair values were estimated using a discounted cash flows approach based on forecasted future cash flows expected to be derived from the property based on current sublease market rent, which is considered a level 3 input in the fair value hierarchy, and other key assumptions such as future sublease market conditions and the discount rate.

The Company’s finance lease obligations consist of certain property and equipment financed through finance leases.

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In June 2024, in connection with the Company’s 2024 annual shareholder meeting, shareholders approved an amendment to the 2020 stock option plan that redefined the definition of common stock outstanding for the purposes of calculating the annual increase to the shares available for issuance.

After the amendment, outstanding equity includes all outstanding common shares as well as outstanding pre-funded warrants.

amendment, outstanding equity includes all outstanding common shares as well as outstanding pre-funded warrants.

The 2020 Plan provides that the number of shares reserved and available for issuance will automatically increase on January 1, 2021, and each January 1 thereafter, by 4 % of the Company’s outstanding number of shares of common stock, inclusive of outstanding pre-funded warrants, on the immediately preceding December 31, or such lesser number of shares as determined by the Company’s compensation committee.

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As of December 31, 2025, the total unrecognized stock-based compensation expense for unvested stock options was $ 63.4 million, which is expected to be recognized over 2.1 years.

During the first quarter of 2025, the Company began granting performance stock options, or PSOs, under the Company’s 2020 Stock Option and Incentive Plan to certain key employees of the Company, including the Company’s executive officers and management team.

The total number of PSOs that may vest will range from 0 to a maximum of 100 % of the target number of options granted.

The PSOs will vest in three separate installments based upon the achievement of three clinical milestones.

The achievement of one clinical milestone will result in the vesting of 40 % of the Target Amount, the achievement of a second clinical milestone will result in the vesting of 40 % of the Target Amount and the achievement of third clinical milestones will result in the vesting of 20 % of the Target Amount.

None of the PSOs with respect to the clinical milestone objective may vest prior to the first anniversary of the grant date.

During the year ended December 31, 2025, the Company granted 88,000 PSOs with a weighted average strike price of $ 30.17 .

As of December 31, 2025, there are 88,000 PSOs outstanding with a weighted average strike price of $ 30.17 .

As of December 31, 2025 the Company has concluded that it is not probable the clinical milestone based performance conditions will be achieved, and as such, no stock based compensation has been recorded for PSOs .

The following table outlines equity-based compensation expense for stock options for the years ended December 31, 2025, 2024 and 2023:

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Restricted Stock Units

The Company has granted shares of restricted stock units with service-based and performance-based vesting conditions.

A summary of restricted stock activity during the year ended December 31, 2024, is as follows:

The Company has granted restricted stock units with service-based and performance-based vesting conditions.

A summary of restricted stock unit activity during the year ended December 31, 2025, is as follows:

Unvested at December 31, 2024

Unvested at December 31, 2025

The Company granted 400,917 , 404,844 , and 295,892 shares of restricted stock during the years ended December 31, 2023, December 31, 2022, and December 31 2021, respectively.

As of December 31, 2024, the total unrecognized stock-based compensation expense for unvested restricted stock was $ 17.1 million, which is expected to be recognized over 2.1 years.

During the years ended December 31, 2024, 2023 and 2022 , the Company recorded stock-based compensation expense for restricted stock of $ 7.7 million, $ 3.8 million and $ 1.4 million, respectively.

During the years ended December 31, 2024, 2023 and 2022 , the Company recorded stock-based compensation expense related to restricted stock of $ 4.8 million, $ 2.5 million and $ 1.1 million, respectively, within research and development.

During the years ended December 31, 2024,

2023 and 2022 , the Company recorded stock-based compensation expense related to restricted stock of $ 2.9 million, $ 1.3 million, and $ 0.3 million, respectively, within general and administrative.

During the first quarter of 2025, the Company began granting restricted stock units with performance-based vesting conditions, or performance stock units ("PSUs") under the Company’s 2020 Stock Option and Incentive Plan to certain key employees of the Company, including the Company’s executive officers and management team.

The total number of PSUs that may vest will range from 0 to a maximum of 100 % of the target number of options granted.

The PSUs will vest in three separate installments based upon the achievement of three clinical milestones.

None of the PSUs with respect to the clinical milestone objective may vest prior to the first anniversary of the grant date.

During the year ended December 31, 2025 and 2024, the Company granted 285,723 and zero restricted stock units, respectively with performance based vesting conditions.

As of December 31, 2025, the Company has concluded that it is not probable the clinical milestone based performance conditions will be achieved, and as such, no stock based compensation has been recorded for PSUs.

The Company granted 796,350 , 400,917 , and 404,844 restricted stock units with service based vesting conditions during the years ended December 31, 2025, 2024 and 2023, respectively.

As of December 31, 2025, the total unrecognized stock-based compensation expense for unvested restricted stock units was $ 28.9 million, which is expected to be recognized over 2.5 years.

During the years ended December 31, 2025, 2024 and 2023 , the Company recorded stock-based compensation expense for restricted stock units of $ 11.2 million, $ 7.7 million and $ 3.8 million, respectively.

During the years ended December 31, 2025, 2024 and 2023 , the Company recorded stock-based compensation expense related to restricted stock units of $ 8.1 million, $ 4.8 million and $ 2.5 million, respectively, within research and development.

During the years ended December 31, 2025, 2024 and 2023 , the Company recorded stock-based compensation expense related to restricted stock units of $ 3.1 million, $ 2.9 million and $ 1.3 million, respectively, within general and administrative.

Equity-Based Compensation Expense

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Related-Party Transactions

John Maraganore is a member of the Company’s Board of Directors, and is affiliated with Jefferies LLC (“Jefferies”).

2025 Follow-on offerings

In connection with both of the Company’s 2025 follow-on public offerings, Jefferies LLC (“Jefferies”) acted as one of the underwriters in the syndicate of underwriters.

John Maraganore is a member of the Company’s Board of Directors and is affiliated with Jefferies.

In connection with its participation in the offerings, Jefferies received customary underwriting discounts and commissions.

The total underwriting commission paid to Jefferies through December 31, 2025 was approximately $ 11.0 million.

Registration Rights Agreement

Concurrently with the June 2025 follow-on offering, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with Baker Brothers Life Sciences, L.P.

and 667, L.P.

(collectively, the “BBA Funds”), entities affiliated with Atlas Venture (“Atlas”) and entities affiliated with BVF Partners L.P.

(“BVF” and, together with the BBA Funds and Atlas, the “Affiliated Entities”), all of which are considered related parties given their affiliation with certain members of the Company's Board of Directors.

Among other things, the Registration Rights Agreement provides the Affiliated Entities with certain “resale” registration rights.

The Registration Rights Agreement provides that, subject to certain limitations, upon written request from the Affiliated Entities, beginning on February 28, 2026 the Company will be required to file a registration statement covering the resale of the registrable securities held by the Affiliated Entities.

Furthermore, the Affiliated Entities will be entitled to include their registrable securities in a registration statement filed by the Company in connection with a public offering.

The Registration Rights Agreement also requires the Company to pay certain expenses relating to such registrations and to indemnify the Affiliated Entities against certain liabilities.

Jefferies Open Market Sale Agreement SM

On October 31, 2024, prior to Dr.

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As of December 31, 2025, the Company has no t sold any shares of its common stock under the Jefferies Sales Agreement.

Other than the aforementioned agreement and the collaborations discussed in Note 5, the Company had no related party transactions for the periods presented in the accompanying consolidated financial statements, which have not otherwise been discussed in these notes to the consolidated financial statements.

The Company records income tax expense related to profits realized by its U.S.

operating subsidiaries.

For the years ended December 31, 2024, 2023 and 2022, immaterial income tax expense was recorded due the group’s net operating loss (“NOL”) and full valuation allowance.

The rate reconciliation of the U.S.

statutory income tax rate to the Company’s effective tax rate for the years ended December 31, 2024, 2023 and 2022 are as follows:

Tax effect at statutory rate

Federal research and development credits

Stock compensation

Other than the aforementioned items, the Company had no related party transactions for the periods presented in the accompanying consolidated financial statements, which have not otherwise been discussed in these notes to the consolidated financial statements.

Incom e Taxes

The Company adopted ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures effective January 1, 2025, on a prospective basis.

The disclosures required by the standard are included below for the year ended December 31, 2025.

Comparative prior-period disclosures have not been revised.

The components of loss before income taxes were as follows (in thousands):

Total loss before income taxes

The Company has had immaterial tax expense due to operating losses incurred since inception and no deferred tax provision in the current period.

The following table reconciles the U.S.

federal statutory income tax rate to the Company’s effective income tax rate for the year ended December 31, 2025 (in thousands) :

December 31, 2025

Percentage (%)

Federal statutory income tax rate

State income taxes, net of federal income tax effect

Research and development tax credits

Changes in valuation allowances

Nontaxable or nondeductible items:

Excess tax benefits on share-based payments

Stock-based compensation

Effective income tax rate

As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the effective income tax rate differed from the federal statutory income tax rate as follows:

Federal statutory income tax rate

State income taxes, net of federal benefit

Federal and state research and development tax credits

Stock-based compensation

Disallowed Expenditures

Change in valuation allowance

Change in deferred tax asset valuation allowance

Effective income tax rate

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

Significant components of the Company’s net deferred income taxes are as follows (in thousands):

The significant components of the Company’s net deferred income taxes were as follows (in thousands):

Deferred Tax Assets:

Federal net operating loss carryforwards

State net operating loss carryforwards

Net operating loss carryforwards

Research and development credit carryforwards

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Valuation allowance

Deferred tax assets

Total deferred tax assets, net of valuation allowance

Deferred Tax Liabilities:

Fixed and intangible assets

Right-of-use assets

Net deferred tax asset

The Company has had immaterial income tax expense due to operating losses incurred since inception and no deferred tax provision in the current period.

ASC 740 requires a valuation allowance to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more-likely-than-not that some portion or all the deferred tax assets will not be realized.

The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets.

Operating right-of-use assets

Total deferred tax liabilities

Net deferred tax assets

The changes in the valuation allowance were as follows (in thousands):

Beginning balance

Domestic federal income taxes

Domestic state & local income taxes

Ending balance

The Company has evaluated the positive and negative evidence bearing upon the reliability of its deferred tax assets.

Based on this, the Company has provided a valuation allowance for the full amount of the net deferred tax assets as the realization of the deferred tax assets is not determined to be more likely than not.

During 2024, the valuation allowance increased by approximately $ 74 million primarily due to the increase in the Company’s book loss reported in the period and the generation of additional research and development credits.

Beginning in 2022, Tax Cuts and Jobs Act (TCJA) amended Section 174 and now requires U.S.-based and non-U.S-based research and experimental (R&E) expenditures to be capitalized and amortized over a period of five or 15 years, respectively, for amounts paid in tax years starting after December 31, 2021.

Prior to the TCJA amendment, Section 174 allowed taxpayers to immediately deduct R&E expenditures in the year paid or incurred.

The Company has applied this required change in accounting method beginning in 2022 and the computation may be adjusted pending future IRS guidance.

As of December 31, 2024, the Company had approximately $ 221.3 million and $ 238.3 million of Federal & State operating loss carryforwards respectively.

Of the Federal net operating loss carryovers, $ 211.5 million are not subject to expiration and the remaining Federal and state NOLs begin to expire in 2037 .

These loss carryforwards are available to reduce future federal taxable income, if any.

As of December 31, 2024, the Company also has federal and state research and development credit carryforwards and orphan drug credit carryforwards of approximately $ 33.1 million and $ 12.0 million respectively, which can be used to offset future income taxes.

These credits will begin to expire beginning in December 2032.

During the year ended December 31, 2025, the valuation allowance increased by $ 94.1 million primarily due to the increase in the Company’s net operating loss, capitalized expenditures and tax credit carryforwards during the period.

As of December 31, 2025, the Company had $ 571.6 million and $ 607.5 million of federal and state operating loss carryforwards, respectively.

Substantially all of the federal net operating losses ("NOLs") are not subject to expiration and the state NOLs begin to expire in 2037 .

These loss carryforwards are available to reduce future federal and state taxable income, if any.

As of December 31, 2025, the Company also had federal and state research and development tax credit carryforwards of $ 40.1 million and $ 18.6 million respectively, to offset future income taxes, which will begin to expire in December 2039.

These loss carryforwards are subject to review and possible adjustment by the appropriate taxing authorities.

The amount of loss carryforwards that may be utilized in any future period may be limited based upon changes in the ownership of the Company’s ultimate parent.

The Company follows the provisions of ASC 740-10, Accounting for Uncertainty in Income Taxes, which specifies how tax benefits for uncertain tax positions are to be recognized, measured, and recorded in financial statements;

Utilization of the Company’s NOL carryforwards and research and development credit carryforwards may be subject to a substantial annual limitation due to ownership change limitations that have occurred previously or that could occur in the future in accordance with Section 382 as well as similar state provisions.

These ownership changes may limit the amount of NOL and research and development credit carryforwards that can be utilized annually to offset future taxable income and taxes, respectively.

In general, an ownership change as defined by Section 382 results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50% over a three-year period.

Since its formation, the Company has raised capital through the issuance of capital stock on several occasions.

These financings could result in a change of control as defined by Section 382.

The Company has not yet conducted an analysis under Section 382 to determine if historical changes in ownership through December 31, 2025, would limit or otherwise restrict its ability to utilize its NOL and research and development credit carryforwards.

In addition, future changes in ownership occurring after

December 31, 2025 could affect the limitation in future years, and any limitation may result in expiration of a portion of the NOL or research and development credit carryforwards before utilization.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law.

Among other provisions, this act includes permanently extended and modified certain expiring provisions of the 2017 Tax Cuts and Jobs Act and restored the immediate expensing of domestic research and development expenses.

The Company has evaluated the impacts of these provisions and has concluded the OBBBA does not have a material impact on its consolidated financial statements other than reclassifications of the deferred tax assets.

The Company follows the provisions of ASC Topic 740-10, Accounting for Uncertainty in Income Taxes, which specifies how tax benefits for uncertain tax positions are to be recognized, measured, and recorded in financial statements;

requires certain disclosures of uncertain tax matters;

specifies how reserves for uncertain tax positions should be classified on the balance sheet;

specifies how reserves for uncertain tax positions should be classified on the consolidated balance sheets;

and provides transition and interim period guidance, among other provisions.

As of December 31, 2024, and 2023, the Company has not recorded tax reserves associated with any unrecognized tax benefits.

The Company’s policy is to recognize interest and penalties accrued on any uncertain tax positions as a component of income tax expense, if any, in its statements of income.

As of December 31, 2025 and 2024, the Company has not recorded any amounts for uncertain tax positions.

The Company’s policy is to recognize interest and penalties accrued on any uncertain tax positions as a component of income tax expense, if any, in its consolidated statements of operations and comprehensive loss.

As of December 31, 2025 and 2024, the Company had no reserves for uncertain tax positions.

For the years ended December 31, 2025, 2024, and 2023, no estimated interest or penalties were recognized on uncertain tax positions.

The Company’s federal and Massachusetts income tax returns for the years ended December 31, 2021 to December 31, 2024 remain open and are subject to examination by the Internal Revenue Service and state taxing authorities.

In addition, the Company’s tax carryover attributes such as net operating losses or credits from earlier period are also subject to examination.

The Company files federal income tax returns in the United States and state income tax returns in Massachusetts and various other state jurisdictions.

The Company’s tax returns for the years ended December 31, 2022 to December 31, 2025 remain open and subject to examination by the Internal Revenue Service and state taxing authorities.

Net Loss per Share

Basic and diluted loss per share is computed by dividing net loss by the weighted-average common shares outstanding for the period, including the pre-funded warrants given their nominal exercise price (in thousands, except for share and per share data):

Weighted average common shares outstanding, basic

Basic and diluted loss per share is computed by dividing net loss by the weighted-average common stock outstanding for the period.

The Company had 15,815,253 and 15,159,753 pre-funded warrants outstanding as of December 31, 2025 and 2024, respectively.

Each pre-funded warrant is exercisable for one share of common stock at an exercise price of $ 0.0001 per share.

Due to the nominal exercise price of the pre-funded warrants, they are considered to be outstanding shares of common stock for purposes of the calculation of earnings per share.

(in thousands, except for share and per share data):

Weighted average common shares outstanding, basic and diluted

Weighted average pre-funded warrants outstanding, basic and diluted

Total weighted average common stock outstanding, basic and diluted

Net Loss per share:

Net loss per share, basic and diluted

The Company’s potentially dilutive securities, which include restricted stock units, and stock options, have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share.

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

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Long-lived assets consist of property and equipment, net, and operating lease right-of-use assets.

The chief operating decision maker uses net loss to monitor budget versus actual results and to analyze cash flows in assessing performance of the segment and allocating resources.

The chief operating decision maker uses consolidated net loss to monitor budget versus actual results and to analyze cash flows in assessing performance of the segment and allocating resources.

Factors used in determining the reportable segment include the nature of the Company’s operating activities, the organizational and reporting structure and the type of information reviewed by the CODM to allocate resources and evaluate financial performance.

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Segment net loss

(1) Certain prior period amounts have been recast to conform with current period presentation.

(2) Research and development compensation and related personnel expense for the years ended December 31, 2025, 2024 and 2023 is inclusive of $ 31.5 million, $ 27.8 million, and $ 21.6 million of stock-based compensation expense, respectively.

(3) General and administrative expense for the years ended December 31, 2025, 2024 and 2023 is inclusive of $ 28.4 million, $ 27.2 million, and $ 21.6 million of stock-based compensation expense, respectively.

(3) Other expense for the year ended December 31, 2024 is inclusive of a $ 4.9 million impairment of long-lived assets.

(4) Other expense for the years ended December 31, 2025 and 2024 is inclusive of a $ 3.9 million and $ 4.9 million impairment of long-lived assets, respectively.

Depreciation expense for the years ended December 31, 2025, 2024 and 2023 was $ 8.3 million, $ 7.4 million and $ 3.6 million, respectively.

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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