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Item 2. Management’s Discussion and Analysis

2025-11-05 compared with 2025-07-30 · 119 added, 130 removed, 137 unchanged (65% of the section changed)

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Graphite’s assets and liabilities were measured and recognized at their fair values as of the closing of the Merger.

We are a pre-commercial biopharmaceutical company focused on the development and commercialization of innovative therapies to improve vision.

Our initial focus is the treatment of presbyopia, the inevitable loss of near vision that impacts the daily lives of nearly all people over 45.

In the United States, the estimated addressable population who suffer from this condition, known as presbyopes, is 128 million, almost four times the number of individuals suffering from dry eye disease and three times the number of individuals suffering from childhood myopia, macular degeneration, diabetic retinopathy and glaucoma combined.

We believe that a once-daily pharmacological eye drop that can effectively and safely improve near vision throughout the full workday, without the need for reading glasses, could be a highly attractive commercial product with an estimated U.S.

We are a commercial pharmaceutical company focused on the commercialization of VIZZ ™ (aceclidine ophthalmic solution) 1.44%, the first and only FDA-approved aceclidine-based eye drop for the treatment of presbyopia, a condition impacting an estimated 1.8 billion people globally and 128 million people in the United States.

We are commercializing VIZZ in the United States and continue to establish licensing partnerships internationally to provide access to VIZZ globally.

We believe that a once-daily pharmacological eye drop that can effectively and safely improve near vision throughout the full workday, without the need for reading glasses, is a highly attractive commercial product with an estimated U.S.

market opportunity in excess of $3 billion.

It is our goal to develop and commercialize such a product, and we have assembled an executive team with extensive clinical and commercial experience to execute this goal and become the category leader.

Our lead product candidate LNZ100 is a preservative-free, single-use, once-daily eye drop containing aceclidine.

We believe our product candidate is differentiated based on rapid onset, degree and duration of near vision improvement, its ability to be used across the full age range of presbyopes, from their mid-40s to well into their mid-70s, as well as a broad refractive range.

Aceclidine’s pupil-selective mechanism of action was demonstrated in our clinical trials where near vision improved while avoiding blurry distance vision.

Our product candidate was well-tolerated in clinical trials, and its active ingredient aceclidine has a favorable tolerability profile that have been well-established empirically.

LNZ100 has patent protection until 2044 in the United States, at a minimum, due to a robust intellectual property portfolio underpinned by issued patents.

In June 2024, LENZ hosted a Key Opinion Leader (“KOL”) event, highlighting capstone data from the Phase 3 CLARITY study, featuring real-world perspectives from lead investigators and prominent KOLs on the current treatment landscape for presbyopia and their perspectives on LNZ100 data from the Phase 3 CLARITY study.

The capstone data results from the CLARITY Phase 3 study highlighted:

• Robust Product Profile:

Patients treated with LNZ100 achieved near universal response with rapid onset and long duration, highlighting a potential best-in-class product profile.

• Rapid onset:

At 30 minutes, LNZ100 reported 71% and 91% of participants achieved three- and two-lines or greater improvement in CLARITY 2, respectively.

• Primary Endpoint Achievement (3 Hours):

LNZ100 reported 71% and 91% of participants achieved three- and two-lines or greater improvement in CLARITY 2, respectively.

• Long duration:

At 10 hours, LNZ100 reported 40% and 69% of participants achieved three-and two-lines or greater improvement in CLARITY 2, respectively.

• Beyond 3-lines of improvement was observed:

LNZ100 reported 84% of participants achieving at least 4 lines and 52% at least 5 lines of near vision improvement.

• Statistically significant improvement in distance vision:

41% of participants achieved 1-line or more of distance vision improvement.

• Safety profile:

LNZ100 was well-tolerated, with no serious treatment-related adverse events reported in over 30,000 patient treatment days.

Our other product candidate LNZ101, a preservative-free eye drop containing aceclidine and brimonidine, showed similar results, including achieving primary and secondary endpoints in both CLARITY 1 and 2, but did not show superiority to LNZ100.

Based on these results, we selected LNZ100 as our lead product candidate, for which we submitted a New Drug Application (“NDA”) to Food and Drug Administration (“FDA”) in August 2024.

In October 2024, the FDA assigned a Prescription Drug User Fee Act (“PDUFA”) target action date of August 8, 2025, which, if approved, will be immediately followed by a commercial launch in the United States, with the product anticipated to be available in the market in the fourth quarter of 2025.

The FDA notified the Company in its letter to notify its acceptance to review the NDA that they do not plan to hold an advisory committee meeting, which was reiterated during the mid-cycle and late-cycle review.

We believe that LNZ100 could be the first and only aceclidine-based product approved by the FDA and would then be eligible for five years of new chemical entity (“NCE”) exclusivity in the United States.

As of June 30, 2025 , we had $209.6 million of cash, cash equivalents, restricted cash, and marketable secu rities.

We believe that our existing cash, cash equivalents and marketable securities as of June 30, 2025 will allow us to continue to build infrastructure and commercialize LNZ100, subject to FDA approval, and will be sufficient to fund the Company to positive operating cash flow subsequent to such commercial launch.

We do not expect to generate any revenue from product sales unless and until we suc cessfully obtain regulatory approval for LNZ100 .

We have incurred net losses in each year since inception, and as of June 30, 2025 , we had an accumulated deficit of $174.5 million .

It is our goal to successfully commercialize VIZZ, and we have assembled an executive team with extensive clinical and commercial experience to execute this goal and become the category leader.

VIZZ (aceclidine ophthalmic solution) 1.44% is a once-daily eye drop developed to restore clear near vision for up to 10 hours.

VIZZ is powered by aceclidine, highlighted by its differentiated mechanism of action as a predominantly pupil-selective miotic that interacts with the iris, with minimal ciliary muscle stimulation.

VIZZ contracts the iris sphincter muscle resulting in a pinhole effect and uniquely achieves a sub-2mm pupil that extends depth of focus to significantly improve near vision without causing a myopic shift.

Aceclidine, the sole active ingredient in VIZZ, is a new chemical entity (“NCE”) in the United States and its FDA approval marks a global first in the treatment of presbyopia.

VIZZ has patent protection until 2044 in the United States, at a minimum, due to a robust intellectual property portfolio underpinned by issued patents.

On July 31, 2025, the FDA approved VIZZ, making it the first and only aceclidine-based product approved by the FDA.

VIZZ has five years of NCE exclusivity in the United States, expiring in July 2030.

The Company commercially launched VIZZ in the U.S.

in August 2025, with direct-to-eye care professional sales and marketing activities initiated immediately upon approval.

Professional product sample distribution by the sales force to optometrists and ophthalmologists and commercial product shipments to customers via our e-pharmacy partner were initiated in October 2025, and we anticipate product will be broadly available in retail pharmacies in the middle of the fourth quarter of 2025.

Financial Overview

As of September 30, 2025 , we had $202.2 million of cash, cash equivalents, restricted cash, and marketable secu rities.

We believe that our existing cash, cash equivalents and marketable securities as of September 30, 2025 will allow us to

continue to commercialize VIZZ, and will be sufficient to fund the Company to positive operating cash flow.

We have incurred net losses in each year since inception, and as of September 30, 2025 , we had an accumulated deficit of $191.2 million .

These losses have resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations.

We expect to continue to incur significant expenses and operating losses as we seek FDA approval and begin commercialization.

These costs include expenses associated with the regulatory approval process and, subject to such approval, preparation for the potential commercial launch of LNZ100, subject to FDA approval.

Additionally, we anticipate incurring expenses related to product sales, marketing, manufacturing, and distribution, and additional costs associated with being a public company, including audit, legal, regulatory and tax-related services associated with maintaining compliance with an exchange listing and SEC requirements.

As a result of these and other factors, while we believe that our existing cash, cash equivalents and marketable securities as of June 30, 2025 will fund the Company to positive operating cash flow subsequent to commercial launch, if LNZ100 is approved, it is possible that we may require additional financing to fund our operations and planned growth.

Through the completion of the Merger, L ENZ OpCo financed its operations primarily through private placements of its common stock and convertible preferred stock.

Concurrent with the closing of the Merger on March 21, 2024, we completed the March 2024 PIPE Financing of 3,559,565 shares of common stock for an aggregate gross purchase price of $53.5 million.

We expect to continue to incur significant expenses related to product sales, marketing, manufacturing, and distribution of VIZZ as we begin commercialization, and additional costs associated with being a public company, including audit, legal, regulatory and tax-related services associated with maintaining compliance with an exchange listing and SEC requirements.

As a result of these and other factors, and while we believe that our existing cash, cash equivalents and marketable securities as of September 30, 2025 will fund the Company to positive operating cash flow, it is possible that we may require additional financing to fund our operations and planned growth.

Since our inception, we have financed our operations primarily through public offerings of our common stock, proceeds from the Merger, and private placements of our common stock and convertible preferred stock.

Concurrent with the closing of the Merger on March 21, 2024, we completed a private placement (the “March 2024 PIPE Financing”) of 3,559,565 shares of common stock for an aggregate gross purchase price of $53.5 million.

Additionally, on July 17, 2024, we completed a private placement (the “July 2024 PIPE Financing”) with Ridgeback Capital Investments, L.P.

of 1,578,947 shares of common stock for an aggregate gross purchase price of $30.0 million.

The Company has also sold an aggregate of 920,500 shares of common stock under the sales agreement with TD Securities (USA) LLC , resulting in net proceeds to the Company of $26.1 million.

If we are unsuccessful in generating sufficient revenue and operating cash flow from sales of LNZ100, if approved, we may be required to finance our cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements.

However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all.

Our failure to raise capital or enter into such other arrangements if and when needed would have a negative impact on our financial condition and could force us to delay, limit, reduce or terminate 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 September 30, 2025, we have sold an aggregate of 920,500 shares of common stock under the sales agreement with TD Securities (USA) LLC (the “Sales Agreement”) , resulting in net proceeds to the Company of $26.1 million.

As of September 30, 2025, the Company had $123.5 million of capacity remaining under the Sales Agreement.

In October 2025, the Company sold an aggregate of 2,698,134 shares of common stock at a weighted-average price of $45.79 under the Sales Agreement, utilizing the remaining capacity under the Sales Agreement.

License Agreements

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We received nonrefundable, non-creditable upfront payments totaling $15.0 million as initial consideration under the CORXEL License during the year ended December 31, 2022.

In addition, we are also eligible to receive (i) up to $95.0 million in regulatory and sales milestone payments, (ii) tiered, escalating royalties in the range of 5% to 15% on net sales of Products in Greater China by CORXEL, its affiliates and sublicensees, and (iii) tiered, deescalating royalties in the range of 15% to 5% of sublicensing income received by CORXEL prior to the regulatory approval of the first Product in Greater China.

In addition, we received $5.0 million upon submission of the NDA for LNZ100 to the National Medical Products Administration (“NMPA”) in Greater China for the treatment of presbyopia and another $5.0 million upon FDA approval of VIZZ during the three months ended September 30, 2025.

We are also eligible to receive (i) up to an additional $85.0 million in regulatory and sales milestone payments, (ii) tiered, escalating royalties in the range of 5% to 15% on net sales of Products in Greater China by CORXEL, its affiliates and sublicensees, and (iii) tiered, deescalating royalties in the range of 15% to 5% of sublicensing income received by CORXEL prior to the regulatory approval of the first Product in Greater China.

The $15.0 million upfront payments allocated to that single performance obligation was recognized on execution of the CORXEL License during the year ended December 31, 2022.

No contractual milestones were met under the CORXEL License during the six months ended June 30, 2025 or 2024.

During the three months ended September 30, 2025, the first regulatory milestone under the CORXEL License was achieved upon submission of the NDA for LNZ100 to the NMPA.

A second regulatory milestone under the CORXEL License was achieved upon FDA approval of VIZZ.

We recognized revenue and received payment totaling $10.0 million for the achievement of both regulatory milestones during the three months ended September 30, 2025.

No other contractual milestones were met under the CORXEL License during the three and nine months ended September 30, 2025 or 2024.

On October 27, 2024, CORXEL and the Company announced positive topline data from the Phase 3 JX07001 clinical trial of LNZ100 in patients with presbyopia in China.

In this China Phase 3 safety and efficacy trial, LNZ100 achieved the primary endpoint and key secondary endpoints, with statistically significant three-lines or greater improvement in Best Corrected Distance Visual Acuity (“BCDVA”) at near, without losing one-line or more in distance visual acuity.

In July 2025, a regulatory milestone was achieved upon the submission of the NDA for LNZ100 to the National Medical Products Administration (“NMPA”) in Greater China for the treatment of presbyopia.

Lotus Pharmaceutical Co., LTD.

License and Commercialization Agreement

On May 7, 2025 the Company entered into a license and commercialization agreement providing an exclusive license (the “Lotus License”) to certain of the Company's IP to commercialize LNZ100 for the treatment of presbyopia in humans in the Republic of Korea, the Kingdom of Thailand, Republic of the Philippines, the Socialist Republic of Vietnam, Malaysia, Negara Brunei Darussalam, the Republic of Indonesia, and the Republic of Singapore (collectively, “Southeast Asia”).

Under the terms of the Lotus License, the Company received a $5.0 million nonrefundable, non-creditable upfront payment, and is eligible to receive up to $120.0 million of regulatory and sales milestones, as well as tiered, double-digit royalties on future net sales in Southeast Asia.

On May 7, 2025, we entered into a license and commercialization agreement providing an exclusive license (the “Lotus License”) to certain of our IP to commercialize LNZ100 for the treatment of presbyopia in humans in the Republic of Korea, the Kingdom of Thailand, Republic of the Philippines, the Socialist Republic of Vietnam, Malaysia, Negara Brunei Darussalam, the Republic of Indonesia, and the Republic of Singapore (collectively, “Southeast Asia”).

Under the terms of the Lotus License, we received a $5.0 million nonrefundable, non-creditable upfront payment, and are eligible to receive up to $120.0 million of regulatory and commercial milestone payments, as well as tiered, double-digit royalties on future net sales in Southeast Asia.

Laboratoires Théa License and Commercialization Agreement

On July 7, 2025, the Company entered into a license and commercialization agreement providing an exclusive license (the “Théa License”) to register and commercialize LNZ100 for the treatment of presbyopia in Canada.

Under the terms of the Théa License, the Company is eligible to receive up to $70.0 million in upfront, regulatory and commercial milestone payments, as well as tiered, double-digit royalties on future net sales in Canada.

On July 7, 2025, we entered into a license and commercialization agreement providing an exclusive license (the “Théa License”) to register and commercialize LNZ100 for the treatment of presbyopia in Canada.

Under the terms of the Théa License, we received a $2.5 million nonrefundable, non-creditable upfront payment, and are eligible to receive up to $67.5 million in regulatory and commercial milestone payments, as well as tiered, double-digit royalties on future net sales in Canada.

Key Trends and Factors Affecting Comparability Between Periods

• Our research and development costs increased during the three months ended June 30, 2025, relative to the comparative period in 2024 due to an increase in pre-approval and contingent product manufacturing to support the potential commercial launch of LNZ100, which is recorded in research and development prior to approval.

Our research and development costs decreased during the six months ended June 30, 2025, relative to the six months ended June 30, 2024, primarily as a result of reduced clinical research expenses related to the substantial completion of our Phase 3 CLARITY trials in March 2024.

We expect our research and development costs will decrease in 2025, relative to 2024, given the completion of the CLARITY trials and subsequent wind-down of clinical activities over 2024.

• We expect that selling, general and administrative expenses will continue to increase in 2025, relative to 2024, as we have built a cross-functional commercial team consisting of marketing and commercial operations and will continue to strategically build our sales and commercial infrastructure with capabilities designed to scale when necessary to support a potential commercial launch of LNZ100, subject to FDA approval.

These expenses increased during the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, and we expect such expenses to continue to increase for the foreseeable future.

• License revenue increased during the three and six months ended June 30, 2025 relative to the three and six months ended June 30, 2024 as a result of an upfront payment received under the Lotus License.

The Company may generate future revenue from additional license and collaboration agreements to commercialize LNZ100 outside the U.S.

The Company has not recorded any product sales revenue for the periods presented.

• License revenue increased during the three and nine months ended September 30, 2025 relative to the three and nine months ended September 30, 2024 as a result of upfront payments received under the Lotus and Théa Licenses, as well as the achievement of two regulatory milestones under the CORXEL License.

We may generate future revenue from additional license and collaboration agreements to commercialize VIZZ outside the U.S.

We have not recorded any product sales revenue for the periods presented.

• We expect that selling, general and administrative expenses will continue to increase in 2025, relative to 2024, as we have built a cross-functional commercial team consisting of marketing, commercial operations and an 88-territory sales force, and will continue to strategically support our sales and commercial infrastructure with capabilities designed to scale when necessary to support the commercial launch of VIZZ.

These expenses increased during the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, and we expect such expenses to continue to increase for the foreseeable future.

• Our research and development costs decreased during the three months ended September 30, 2025, relative to the comparative period in 2024 primarily due to FDA approval of VIZZ during the three months ended September 30, 2025.

On a prospective basis subsequent to FDA approval on July 31, 2025, certain expenses that were historically classified as research and development expenses were and will be prospectively classified into sales, general and administrative expenses, including certain medical affairs and chemistry, manufacturing and controls expenses that indirectly support VIZZ.

In addition, our research and development costs decreased during the nine months ended September 30, 2025, relative to the nine months ended September 30, 2024, primarily as a result of reduced clinical research expenses related to the substantial completion of our Phase 3 CLARITY trials in March 2024 and the prospective classifications noted above.

We expect our research and development costs will continue to decrease over the remainder of 2025, relative to 2024, given the completion of the CLARITY trials, the subsequent reduction of clinical activities over 2024 and the FDA approval of VIZZ.

Recent Developments

Hiring of Sales Force

During the three months ended June 30, 2025, we recruited and hired eighty-eight sales specialists, who, combined with our inside sales team, are expected to target approximately 15,000 eye care professionals.

Our sales force has completed onboarding activities in anticipation of a potential commercial launch of LNZ100, subject to FDA approval.

Recently Executed License Agreements

The Company executed two additional license agreements to out-license the commercialization rights for LNZ100 in the Republic of Korea and certain countries in Southeast Asia to Lotus Pharmaceutical Co., LTD., and to Laboratoires Théa in Canada.

Under these licensing agreements, the Company is eligible to receive up to $195 million in upfront, regulatory and commercial milestone payments, as well as tiered, double-digit royalties on future net sales in the respective contractual territories.

FDA Approval and Commercial Launch of VIZZ

On July 31, 2025, the FDA approved VIZZ, the first and only aceclidine-based product approved by the FDA.

VIZZ has five years of NCE exclusivity in the United States, expiring in July 2030.

We commercially launched VIZZ in the U.S.

in August 2025, with direct-to-eye care professional sales and marketing activities initiated immediately upon approval.

CORXEL New Drug Application Submission

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Components of Statements of Operations and Comprehensive Loss

LENZ currently has no products approved for sale, and it has not generated any revenue from product sales to date.

It has generated revenue related to various license and collaboration agreements, and in the future may generate revenue from payments received under licenses or collaboration agreements LENZ may enter into with respect to its product candidate.

We have not generated any revenue from product sales through September 30, 2025, however, we expect to generate revenue from sales of VIZZ beginning in the fourth quarter of 2025.

We have generated revenue related to various license and collaboration agreements, and in the future may generate revenue from payments received under additional licenses or collaboration agreements we may enter into with respect to VIZZ.

Operating Expenses

Selling, General and Administrative

Selling, general and administrative expenses consist primarily of salaries and related benefits, including stock-based compensation, related to our executive, finance, business development, sales and marketing, human resources and other corporate functions.

Other selling, general and administrative expenses include marketing, and advertising costs to support our 88-territory sales force, professional fees for legal, tax and business consulting services, public company related expenses such as audit fees and insurance costs, intellectual property and patent costs, facility costs and travel costs.

Subsequent to the FDA approval of VIZZ, selling, general and administrative expenses also include salaries and related benefits and stock-based compensation costs related to our quality assurance, regulatory, supply chain and operations, and medical affairs functions.

Research and Development

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(ii) third-party contract costs relating to research, formulation, manufacturing, nonclinical studies and clinical trial activities;

(iii) external costs of outside consultants who assist with technology development, regulatory affairs, clinical development and quality assurance;

(iii) external costs of outside consultants who assist with technology development, regulatory affairs, clinical development and quality assurance prior to FDA approval;

and (iv) allocated facility-related costs.

Costs for certain activities, such as manufacturing, nonclinical studies and clinical trials are generally recognized based on the evaluation of the progress of completion of specific tasks using information and data provided by our vendors and collaborators.

Research and development activities are central to our business.

Selling, General and Administrative

Selling, general and administrative expenses consist primarily of salaries and related benefits, including share-based compensation, related to our executive, finance, business development, sales and marketing, human resources, and other corporate functions.

Other selling, general and administrative expenses include marketing and advertising costs, professional fees for legal, tax and business consulting services, public company related expenses such as audit fees and insurance costs, intellectual property and patent costs, facility costs and travel costs.

Costs for certain activities, such as nonclinical studies and clinical trials are generally recognized based on the evaluation of the progress of completion of specific tasks using information and data provided by our vendors and collaborators.

Other Income, Net

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Results of Operations

Comparison of the Three Months Ended June 30, 2025 and 2024

Comparison of the Three Months Ended September 30, 2025 and 2024

The following table presents the results of operations for the periods indicated (amounts in thousands, except percentages):

Three Months Ended June 30,

Three Months Ended September 30,

2025 2024 $ Change % Change

License revenue $ 12,500 $ — $ 12,500 N/A

Research and development expenses 9,061 6,945 2,116 30 %

Selling, general and administrative expenses 27,596 6,494 21,102 325 %

Research and development expenses 3,791 6,451 (2,660) (41) %

Other income, net 2,187 2,730 (543) (20) %

License Revenue

License revenue increased during the three months ended June 30, 2025 due to revenue recognized from the upfront payment under the Lotus License.

There was no license revenue in the three months ended June 30, 2024.

Research and Development

Research and development expenses incurred for the three months ended June 30, 2025 were primarily driven by pre-approval and contingent product manufacturing activities to support the potential commercial launch of LNZ100, which is recorded in research and development prior to approval, while research and development expenses for the three months ended June 30, 2024 were substantially all related to the development of LNZ100 in our Phase 3 CLARITY trials.

Research and development expenses increased by $2.1 million, or 30%, to $9.1 million for the three months ended June 30, 2025 compared to $6.9 million for the three months ended June 30, 2024.

The increase was primarily driven by increases of $2.5 million in non-clinical regulatory and chemistry, manufacturing, and control (“CMC”) expenses and $0.2 million in travel related expenses, partially offset by a $0.7 million decrease in regulatory consulting costs as we ramped up regulatory activities in the prior year in advance of our NDA submission.

License revenue increased during the three months ended September 30, 2025 due to revenue recognized from the upfront payment under the Théa License and the achievement of two regulatory milestones under the CORXEL License.

There was no license revenue in the three months ended September 30, 2024.

Selling, General and Administrative

Selling, general and administrative expenses increased $5.4 million, or 73%, to $12.8 million for the three months ended June 30, 2025 compared to $7.4 million for the three months ended June 30, 2024.

The change was primarily driven by increases of $3.9 million in employee salaries and related expenses due to a rise in headcount, including the hiring of eighty-eight sales specialists, and $1.4 million in pre-commercial marketing, advertising and sales infrastructure expenses as we prepare for a potential commercial launch of LNZ100, subject to FDA approval.

Selling, general and administrative expenses increased $21.1 million, or 325%, to $27.6 million for the three months ended September 30, 2025 compared to $6.5 million for the three months ended September 30, 2024.

The change was primarily driven by increases of $12.2 million in employee salaries and related expenses due to a rise in headcount, including the hiring of our 88-territory sales force, $4.9 million in pre-commercial and commercial marketing, advertising and sales infrastructure expenses as we prepared for and subsequently executed the commercial launch of VIZZ, $1.1 million in chemistry and control and regulatory related expenses which were classified as selling, general and administrative expenses subsequent to FDA approval, $1.1 million in travel related costs primarily related to our sales force, $0.9 million in other corporate overhead and $0.6 million in legal costs.

Research and Development

Research and development expenses incurred for the three months ended September 30, 2025 were primarily driven by pre-approval and contingent product manufacturing activities to support the commercial launch of VIZZ, which were recorded in research and development prior to FDA approval on July 31, 2025, while research and development expenses incurred for the three months ended September 30, 2024 were primarily incurred to further refine the manufacturing process for VIZZ.

Research and development expenses decreased by $2.7 million, or 41%, to $3.8 million for the three months ended September 30, 2025 compared to $6.5 million for the three months ended September 30, 2024.

Subsequent to FDA approval, people-related, chemistry and control, and regulatory costs previously classified as research and development expenses were prospectively classified as selling, general and administrative expenses, resulting in period over period decreases in research and development expenses of $1.3 million, $0.9 million, and $0.8 million, respectively.

The reduction in research and development expenses were partially offset by a $0.6 million increase in contingent product manufacturing costs incurred prior to FDA approval.

Prior to FDA approval of VIZZ on July 31, 2025, costs related to the production of inventory were expensed in the period incurred within research and development expenses, resulting in zero cost inventory.

Subsequent to FDA approval of VIZZ, direct and indirect manufacturing costs were capitalized to inventory.

Other Income, net

Other income, net for the three months ended June 30, 2025, was $2.4 million, compared to $4.1 million for the three months ended June 30, 2024.

Interest income earned on our cash, cash equivalents, and marketable securities were materially consistent in the comparative periods.

During the three months ended June 30, 2024, we recorded other income of $1.3 million due to a change in the fair value of the Company’s equity investment without a readily determinable fair value.

Comparison of the Six Months Ended June 30, 2025 and 2024

Other income, net for the three months ended September 30, 2025, was $2.2 million, compared to $2.7 million for the three months ended September 30, 2024.

Interest income earned on our cash, cash equivalents, and marketable securities decreased period over period due to a lower balance of marketable securities and slightly less favorable interest rates.

Comparison of the Nine Months Ended September 30, 2025 and 2024

The following table presents the results of operations for the periods indicated (amounts in thousands, except percentages):

Six Months Ended June 30,

Nine Months Ended September 30,

2025 2024 $ Change % Change

License revenue $ 17,500 $ — $ 17,500 N/A

Research and development expenses 14,879 17,482 (2,603) (15) %

Selling, general and administrative expenses 51,505 19,452 32,053 165 %

Research and development expenses 18,670 23,933 (5,263) (22) %

Other income, net 6,944 6,268 676 11 %

License Revenue

License revenue increased during the six months ended June 30, 2025 due to revenue recognized from the upfront payment under the Lotus License.

There was no license revenue in the six months ended June 30, 2024.

Research and Development

Research and development expenses incurred for the six months ended June 30, 2025 were primarily driven by pre-approval and contingent product manufacturing activities to support the potential commercial launch of LNZ100, while research and development expenses incurred for the six months ended June 30, 2024 were substantially all related to the development of LNZ100 in our Phase 3 CLARITY trials.

Research and development expenses decreased $2.6 million, or 15%, to $14.9 million for the six months ended June 30, 2025 compared to $17.5 million for the six months ended June 30, 2024.

The decrease was primarily driven by a $6.1 million decrease in clinical and nonclinical research expense for our clinical trials, and a $1.0 million decrease in contract regulatory consulting expenses associated with the prior period preparation and filing of our NDA for LNZ100.

The decrease was partially offset by a $2.4 million increase in employee salaries and related expenses due to increased non-clinical regulatory and CMC headcount, a $1.6 million increase in contract manufacturing expenses, and a $0.3 million increase in travel expenses.

License revenue increased during the nine months ended September 30, 2025 due to revenue recognized from the upfront payments under the Lotus and Théa Licenses, and the achievement of two regulatory milestones under the CORXEL License.

There was no license revenue in the nine months ended September 30, 2024.

Selling, General and Administrative

Selling, general and administrative expenses increased $11.0 million, or 85%, to $23.9 million for the six months ended June 30, 2025 compared to $13.0 million for the six months ended June 30, 2024.

Increases in the comparative period included $6.6 million in employee salaries and related expenses due to a rise in headcount, $3.2 million in pre-commercial marketing, advertising and sales infrastructure as we expanded our pre-commercial planning initiatives for a potential commercial launch of LNZ100, subject to FDA approval, and $0.7 million in travel expenses.

Selling, general and administrative expenses increased $32.1 million, or 165%, to $51.5 million for the nine months ended September 30, 2025 compared to $19.5 million for the nine months ended September 30, 2024.

Increases in the comparative period included $19.1 million in employee salaries and related expenses due to a rise in headcount, including the hiring of our 88-territory sales force, $8.1 million in pre-commercial and commercial marketing, advertising and sales infrastructure as we prepared for and subsequently executed the commercial launch of VIZZ, $1.8 million in travel expenses primarily related to our sales force, $1.7 million in other corporate overhead, and $1.1 million in chemistry and control and regulatory related expenses which were classified as selling, general and administrative expenses subsequent to FDA approval.

Research and Development

Research and development expenses incurred for the nine months ended September 30, 2025 were primarily driven by pre-approval and contingent product manufacturing activities to support the commercial launch of VIZZ, while research and development expenses incurred for the nine months ended September 30, 2024 were primarily incurred to further refine the manufacturing process for VIZZ.

Research and development expenses decreased $5.3 million, or 22%, to $18.7 million for the nine months ended September 30, 2025 compared to $23.9 million for the nine months ended September 30, 2024.

The decrease was primarily driven by a $7.0 million decrease in clinical and nonclinical research expense for our clinical trials, and a $1.9 million decrease in contract regulatory consulting expenses associated with the prior period preparation and filing of our NDA for VIZZ.

The decrease was partially offset by a $2.2 million increase in contingent product manufacturing costs incurred prior to FDA approval and a $1.2 million increase in employee salaries and related expenses due to increased non-clinical regulatory and CMC headcount.

Other Income, net

Other income, net for the six months ended June 30, 2025, was $4.8 million, compared to $3.5 million for the six months ended June 30, 2024.

Other income, net for the nine months ended September 30, 2025, was $6.9 million, compared to $6.3 million for the nine months ended September 30, 2024.

Interest income earned on our cash, cash equivalents, and marketable securities increased by $0.8 million as a result of an overall increase in cash on-hand in 2025 over the comparative period.

During the six months ended June 30, 2024, we recorded a $1.0 million charge due to an increase in the fair value of the preferred stock warrants liability, resulting in a non-recurring, non-cash charge at the close of the Merger, and $1.3 million in other income related to an increase in the fair value of the Company's equity investment without a readily determinable fair value.

During the nine months ended September 30, 2024, we recorded a $1.0 million charge due to an increase in the fair value of the preferred stock warrants liability, resulting in a non-recurring, non-cash charge at the close of the Merger, and $1.3 million in other income related to an increase in the fair value of the Company's equity investment without a readily determinable fair value.

Liquidity and Capital Resources

Sources of Liquidity

As of June 30, 2025, we had $209.6 million of cash, cash equivalents, restricted cash, and marketable securities.

We have incurred net losses in each year since inception and as of June 30, 2025, we had an accumulated deficit of $174.5 million.

Our net losses were $14.9 million and $10.3 million for the three months ended June 30, 2025 and 2024, respectively, and $29.5 million and $26.9 million for the six months ended June 30, 2025 and 2024, respectively.

These losses have resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations.

We expect to continue to incur significant expenses and operating losses as we seek approval and pursue the potential commercialization of LNZ100.

These costs include expenses associated with the regulatory approval process for LNZ100, and the preparation for the potential commercial launch of our product, subject to FDA approval.

From inception through June 30, 2025, we received funding of $13.0 million from our initial seed financing, $47.0 million from the sale of Series A Convertible Preferred stock, $10.0 million from the sale of Series A-1 Convertible Preferred Stock, gross proceeds of $83.5 million from the sale of Series B Convertible Preferred stock, approximately $117.8 million in cash and cash equivalents from the Merger, approximately $53.5 million in gross cash proceeds from the March 2024 PIPE Financing, and $30.0 million in gross cash proceeds from the July 2024 PIPE Financing.

As of September 30, 2025, we had $202.2 million of cash, cash equivalents and marketable securities.

We have incurred net losses in each year since inception and as of September 30, 2025, we had an accumulated deficit of $191.2 million.

Our net losses were $16.7 million and $10.2 million for the three months ended September 30, 2025 and 2024, respectively, and $46.2 million and $37.1 million for the nine months ended September 30, 2025 and 2024, respectively.

These losses have

resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations.

We expect to continue to incur significant expenses and operating losses as we begin commercialization of VIZZ, including costs related to product sales, marketing, manufacturing, and distribution.

From inception through September 30, 2025, we received funding of $13.0 million from our initial seed financing, $47.0 million from the sale of Series A Convertible Preferred stock, $10.0 million from the sale of Series A-1 Convertible Preferred Stock, gross proceeds of $83.5 million from the sale of Series B Convertible Preferred stock, approximately $117.8 million in cash and cash equivalents from the Merger, approximately $53.5 million in gross cash proceeds from the March 2024 PIPE Financing, and $30.0 million in gross cash proceeds from the July 2024 PIPE Financing.

On April 4, 2025, we entered into a sales agreement (the “Sales Agreement”) with TD Securities (USA) LLC (“TD Cowen”) under which we may offer and sell up to $150.0 million of shares of our common stock from time to time through an “at the market” offering program under which TD Cowen will act as sales agent.

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The shares will be issued pursuant to our shelf registration statement on Form S-3, including the prospectus supplement contained therein, which was declared effective by the SEC on April 14, 2025.

During the three and six months ended June 30, 2025 , the Company sold an aggregate of 920,500 shares of common stock at a weighted-average price of $28.75 under the Sales Agreement, resulting in net proceeds of $26.1 million .

As of June 30, 2025, the Company had $123.5 million of capacity remaining under the Sales Agreement.

There were no transactions executed under the Sales Agreement during the three months ended September 30, 2025.

During the nine months ended September 30, 2025 , the Company sold an aggregate of 920,500 shares of common stock at a weighted-average price of $28.75 under the Sales Agreement, resulting in net proceeds of $26.1 million .

As of September 30, 2025, the Company had $123.5 million of capacity remaining under the Sales Agreement.

Funding Requirements

We believe that our cash, cash equivalents, and marketable securities as of June 30, 2025 will allow us to continue to build infrastructure and commercialize LNZ100, subject to FDA approval, and such funds are anticipated to fund the Company to positive operating cash flow subsequent to such commercial launch.

We believe that our cash, cash equivalents, and marketable securities as of September 30, 2025 will allow us to continue to build infrastructure and commercialize VIZZ, and such funds are anticipated to fund the Company to positive operating cash flow.

This belief is based on assumptions that may prove to be wrong, and we could use our available capital resources sooner than expected.

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Our future capital requirements will depend on many factors, including but not limited to:

• the costs and timing of manufacturing for LNZ100 and commercial manufacturing if LNZ100 is approved;

• the results, costs, and timing of any additional clinical trials we are required to complete for LNZ100;

• costs associated with establishing a sales, marketing, and distribution infrastructure to commercialize LNZ100 if we obtain marketing approval;

• our ability to generate positive operating cash flow from sales of LNZ100 subsequent to commercial launch of LNZ100, if LNZ100 is approved;

• the costs, timing, and outcome of regulatory review of LNZ100;

• costs associated with maintaining and expanding a sales, marketing, and distribution infrastructure to commercialize VIZZ;

• our ability to generate positive operating cash flow from sales of VIZZ;

• the costs of commercial manufacturing of VIZZ;

• the costs, timing, and outcome of any additional regulatory review of VIZZ;

• the legal costs of obtaining, maintaining, and enforcing our patents and other intellectual property rights;

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• the terms and timing of establishing and maintaining licenses and other similar arrangements;

• our ability to achieve sufficient market acceptance and adequate market share and revenue for LNZ100, if approved;

• our ability to achieve sufficient market acceptance and adequate market share and revenue for VIZZ;

• costs associated with any products or technologies that we may in-license or otherwise acquire or develop.

We intend to evaluate financing opportunities from time to time, and our ability to obtain financing will depend, among other things, on our development efforts, business plans, operating performance and the condition of the capital markets at the time we seek financing.

We cannot be assured that additional financing will be available to us on favorable terms when required, or at all.

We cannot be assured that additional financing will be available to us on favorable terms when

required, or at all.

If we raise additional funds through the issuance of equity or equity-linked securities, those securities may have rights, preferences or privileges senior to the rights of our common stock, and our stockholders may experience dilution.

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The following table summarizes our cash flows for the periods presented (amounts in thousands):

Six Months Ended June 30,

Nine Months Ended September 30,

Net cash (used in) provided by:

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Net cash used in operating activities primarily results from net loss adjusted for non-cash expenses, changes in working capital components, amounts due to contract research organizations to conduct our clinical programs, manufacturing of drug product and employee-related expenditures for research and development and selling, general and administrative activities.

Cash flows from operating activities will continue to be impacted by spending to develop and pursue regulatory approval for LNZ100 and commercialization activities, if approval is obtained, and will also be impacted by any potential future revenue from commercialization activities and licensing arrangements.

Cash flows from operating activities will continue to be impacted by the commercial launch of VIZZ, and will also be impacted by any potential future revenue from commercialization activities and licensing arrangements.

Cash flows will also continue to be affected by other operating and general administrative activities, including operating as a public company.

For the six months ended June 30, 2025, cash used in operating activities was $27.6 million and resulted from a net loss of $29.5 million, in addition to a $1.2 million increase in operating assets, offset by $3.5 million in non-cash adjustments primarily driven by share-based compensation expense.

For the six months ended June 30, 2024, cash used in operating activities was $39.7 million primarily resulting from a net loss of $26.9 million in addition to a $13.4 million cash outflow from the payment of accounts payable and accrued liabilities associated with the Merger and accrued clinical activities, offset by $1.0 million in non-cash adjustments primarily driven by share-based compensation expense and the change in the fair value of preferred warrants.

Net Cash Provided by Investing Activities

Cash provided by investing activities for the six months ended June 30, 2025 was $18.5 million, primarily due to $110.2 million in proceeds from maturities of marketable securities, and partially offset by $91.4 million of purchases of marketable securities and $0.4 million in purchases of property and equipment.

Cash used in investing activities for the six months ended June 30, 2024 was $80.4 million, primarily due to $111.3 million of purchases of marketable securities, and partially offset by $31.0 million in proceeds from maturities of marketable securities.

For the nine months ended September 30, 2025, cash used in operating activities was $36.1 million and resulted from a net loss of $46.2 million, offset by $6.3 million in non-cash adjustments primarily driven by share-based compensation expense and a $3.8 million increase in operating assets.

For the nine months ended September 30, 2024, cash used in operating activities was $50.3 million and resulted from a net loss of $37.1 million, in addition to an approximate $14.4 million cash outflow from the payment of accounts payable and accrued liabilities associated with the Merger and accrued clinical activities, offset by $3.2 million in non-cash adjustments primarily driven by share-based compensation expense and the change in the fair value of preferred warrants.

Net Cash Provided by (Used in) Investing Activities

Cash provided by investing activities for the nine months ended September 30, 2025 was $14.1 million, primarily due to $162.6 million in proceeds from maturities of marketable securities, and partially offset by $147.7 million of purchases of marketable securities and $0.8 million in purchases of property and equipment.

Cash used in investing activities for the nine months ended September 30, 2024 was $142.6 million, primarily due to $195.3 million of purchases of marketable securities, and partially offset by $53.0 million in proceeds from maturities of marketable securities.

Net Cash Provided by Financing Activities

Cash provided by financing activities for the six months ended June 30, 2025 was primarily driven by $26.1 million in net proceeds from common stock sold under the Sales Agreement.

For the six months ended June 30, 2024, cash provided by financing activities was $169.1 million and includes $117.8 million in cash and cash equivalents acquired in the Merger, $53.5 million in gross cash proceeds from the March 2024 PIPE Financing, and approximately $3.8 million in net cash proceeds from exercises of stock options.

Cash provided by financing activities for the nine months ended September 30, 2025 was primarily driven by $26.1 million in net proceeds from common stock sold under the Sales Agreement and $0.8 million in proceeds from exercises of stock options.

For the nine months ended September 30, 2024, cash provided by financing activities was $198.9 million and includes $117.8 million in cash and cash equivalents acquired in the Merger, $53.5 million in gross cash proceeds from the March 2024 PIPE Financing, $30.0 million in gross cash proceeds from the July 2024 PIPE Financing, and approximately $3.9 million in net cash proceeds from exercises of stock options.

Material Cash Requirements from Contractual Obligations

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See Note 6 to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for further details related to our office leases.

We also have contracts with various organizations to conduct research and development activities, including clinical trial organizations to manage regulatory and any remaining clinical trial activities, and manufacturing companies to manufacture the drug product used in the regulatory process and clinical trials.

The scope of the services under these research and development contracts can be modified and the contracts cancelled by us upon written notice.

We also have contracts with various suppliers and manufacturing companies to supply the active pharmaceutical ingredient used in VIZZ, and manufacture the drug product used in the regulatory process and clinical trials.

The scope of the services under these contracts can be modified and the contracts cancelled by us upon written notice.

In the event of a cancellation, the company would be liable for the cost and expenses incurred to date as well as any close out costs of the service arrangement.

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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-Q

Item 2. Management’s Discussion and Analysis