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Item 7. Management’s Discussion and Analysis

2026-03-24 compared with 2025-03-19 · 158 added, 101 removed, 112 unchanged (70% 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 (“U.S.”).

We are commercializing VIZZ in the U.S.

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 2039 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.

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.

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 U.S.

and its FDA approval marks a global first in the treatment of presbyopia.

VIZZ has patent protection until 2044 in the U.S., 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 U.S., 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 product became broadly available in retail pharmacies beginning in November 2025.

Financial Overview

As of December 31, 2025, we had $292.3 million of cash, cash equivalents, restricted cash, and marketable securities.

We believe that our existing cash, cash equivalents and marketable securities as of December 31, 2024 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 successfully obtain regulatory approval for LNZ100.

We have incurred net losses in each year since inception, and as of December 31, 2024, we had an accumulated deficit of $145.0 million.

We believe that our existing cash, cash equivalents and marketable securities as of December 31, 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 December 31, 2025, we had an accumulated deficit of $227.1

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 December 31, 2024 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, LENZ 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 are in the early stages of 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, while we believe that our existing cash, cash equivalents and marketable securities as of December 31, 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.

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 December 31, 2025, we have sold an aggregate of 3,618,634 shares of common stock under the sales agreement with TD Securities (USA) LLC (the “Sales Agreement”) , resulting in net proceeds to the Company of $147.7 million.

As of December 31, 2025, the Company had no remaining capacity under the Sales Agreement.

License and Distribution Agreements

CORXEL License and Collaboration Agreement

In April 2022, we entered into a License and Collaboration Agreement with CORXEL Pharmaceuticals (formerly known as Ji Xing Pharmaceuticals Hong Kong Limited) (“CORXEL”) granting CORXEL an exclusive license (the “CORXEL License” formerly referred to as the “Ji Xing License”) to certain of our intellectual property rights to develop, use, import, and sell products containing LNZ100 (“Products”) for use in the treatment of presbyopia in humans in mainland China, Hong Kong Special Administrative Region, Macau Special Administrative Region, and Taiwan (collectively, “Greater

In April 2022, we entered into a License and Collaboration Agreement with CORXEL Pharmaceuticals (formerly known as Ji Xing Pharmaceuticals Hong Kong Limited) (“CORXEL”) granting CORXEL an exclusive license (the “CORXEL License” formerly referred to as the “Ji Xing License”) to certain of our intellectual property rights to develop, use, import, and sell products containing LNZ100 (commercially known as VIZZ in the U.S.) (“Products”) for use in the treatment of presbyopia in humans in mainland China, Hong Kong Special Administrative Region, Macau Special Administrative Region, and Taiwan (collectively, “Greater China”).

We also granted CORXEL (i) the right to negotiate in good faith and enter into agreements to purchase Products from us for clinical and commercial uses at cost plus a negotiated percentage and (ii) the right of first negotiation to obtain a regional license from us on other products we might develop outside of the field of presbyopia for commercialization in Greater China.

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 New Drug Application (“NDA”) for VIZZ 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 year ended December 31, 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 years ended December 31, 2024 or 2023.

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.

During the year ended December 31, 2025, the first regulatory milestone under the CORXEL License was achieved upon submission of the NDA for VIZZ 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 year ended December 31, 2025.

No other contractual milestones were met under the CORXEL License during the years ended December 31, 2025 or 2024.

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

In this China Phase 3 safety and efficacy trial, VIZZ 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.

Lotus Pharmaceutical Co., LTD.

License and Commercialization Agreement

On May 7, 2025, we entered into a license and commercialization agreement providing an exclusive license (the “Lotus License”) to certain of our intellectual property to commercialize VIZZ 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, escalating royalties in the range of 10% to 20% on future net sales in Southeast Asia.

Laboratoires Théa License and Commercialization Agreement

On July 7, 2025, we entered into a license and commercialization agreement providing an exclusive license (the “Théa License”) to register and commercialize VIZZ 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, escalating royalties in the range of 10% to 20% on future net sales in Canada.

Lunatus Global Medical Supplies Distribution Agreement

On January 2, 2026, we entered into a distribution agreement appointing an exclusive distributor for VIZZ in the United Arab Emirates, Kingdom of Saudi Arabia, Kuwait, Qatar, Bahrain, Oman, Jordan, Lebanon, and Iraq (collectively, the “Middle East”) (the “Lunatus Distribution Agreement”).

Under the terms of the Lunatus Distribution Agreement, we received a nonrefundable, non-creditable upfront payment, and are eligible to receive regulatory and commercial milestone payments and a per unit fee for each unit sold to Lunatus for distribution in the Middle East, pending regulatory approval.

Key Trends and Factors Affecting Comparability Between Periods

• Our research and development costs decreased during the year ended December 31, 2024, relative to the year ended December 31, 2023, 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 continue to 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 year ended December 31, 2024, as compared to the year ended December 31, 2023, and we expect such expenses to continue to increase for the foreseeable future.

• As a result of the Merger, the Company’s corporate general and administrative expenses have increased and will continue to increase from those that we incurred in prior years as a privately held company, including costs related to (i) compliance with the rules and regulations of the SEC and those of Nasdaq, (ii) legal, accounting and other professional services, (iii) insurance, (iv) investor relations activities, and (v) other administrative and professional services.

• The commercial launch of VIZZ in July 2025 resulted in the recognition of product sales, net and associated cost of sales during the year ended December 31, 2025.

There were no product sales, net or cost of sales recognized prior to the commercial launch of VIZZ.

We expect product sales, net and associated cost of sales to increase in 2026 as we continue to execute the commercial launch of VIZZ.

License revenue increased during the year ended December 31, 2025 relative to the year ended December 31, 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.

• Our selling, general and administrative expenses increased 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 commercialization of VIZZ.

We expect such expenses to continue to increase for the foreseeable future due to the recent launch of our direct-to-consumer (“DTC”) marketing campaign and the expansion of our sales force.

• Our research and development costs decreased during the year ended December 31, 2025, relative to the comparative period in 2024 primarily due to FDA approval of VIZZ during the year ended December 31, 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.

We expect our research and development costs will further decrease in 2026, relative to 2025, given the FDA approval of VIZZ.

Recent Developments

NDA Filing and PDUFA Date

On October 21, 2024, we announced the FDA has assigned a PDUFA target action date of August 8, 2025 for LNZ100.

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 review.

Broad Market Availability of VIZZ

On September 30, 2025, we announced the availability of VIZZ via initiation of product sample distribution by the sales force to optometrists and ophthalmologists nationwide.

Commercial product shipments were initiated to customers in October 2025 through our ePharmacy partner, and product availability in retail pharmacies followed in November 2025.

Launch of Direct-to-Consumer Marketing Campaign

On January 14, 2026, we announced the launch of “Make it VIZZable”, the VIZZ consumer campaign with award-winning actor, producer and publisher, Sarah Jessica Parker (“SJP”) as a brand ambassador for VIZZ.

As part of the campaign, SJP

will detail her own experiences with age-related blurry near vision and the ways in which VIZZ has made a real difference in her life.

Lotus New Drug Application Submissions

On December 1, 2025, we announced that Lotus submitted an NDA to the Ministry of Food and Drug Safety for the review and approval of VIZZ, for the treatment of presbyopia in adults in South Korea.

This represented the first submission for approval under the Lotus License.

In the first quarter of 2026, Lotus submitted NDAs for the review and approval of VIZZ in Thailand and Singapore.

Submission of Marketing Authorization Application to European Medicines Agency

On March 10, 2026, we announced the submission of a Marketing Authorization Application (“MAA”) to the European Medicines Agency (“EMA”) for the review and approval of VIZZ.

If approved, the EMA's positive opinion would serve as a foundational step toward making VIZZ available to the millions of Europeans living with age-related blurry near vision.

The submission of the MAA in Europe represents the fifth ex-U.S.

regulatory submission for VIZZ.

Basis of Presentation

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Components of Statements of Operations and Comprehensive Loss

Product Sales, net

Beginning in the fourth quarter of 2025, we have generated revenue from sales of VIZZ, which are recorded net of invoice discounts for prompt payment and distribution service fees, product returns and other incentives.

License Agreements

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

Operating Expenses

Cost of Sales

Cost of sales consists of direct and indirect costs related to the manufacturing and distribution of VIZZ, including raw materials, third-party manufacturing costs, packaging services, and freight costs.

Cost of sales also includes period costs related to certain operations personnel and inventory adjustment charges.

The Company began capitalizing inventory costs upon FDA approval of VIZZ in July 2025.

Prior to FDA approval of VIZZ, manufacturing and other inventory costs were recorded to research and development expenses, resulting in zero cost inventory.

Cost of sales of VIZZ will increase on a per unit basis after zero cost inventory is sold, which we expect to sell during 2026.

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

Research and development expenses, which consist primarily of costs associated with our product research and development efforts, are expensed as incurred.

Research and development expenses consist primarily of:

Research and development expenses, which consisted primarily of costs associated with our product research and development efforts, were expensed as incurred.

Research and development expenses consisted primarily of:

(i) employee related costs, including salaries, benefits and share-based compensation expense for employees engaged in research and development activities;

(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.

Other Income (Expense), Net

Other income (expense), net consists of the change in fair value of preferred stock warrants liability, interest income earned on cash, cash equivalents, and short-term investments, and changes in the fair value of long-term investments due to observable price changes in orderly transactions for an identical or similar investment.

Costs for certain activities, such as nonclinical studies and clinical trials were 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

Other income, net consists of interest income earned on cash, cash equivalents, and short-term investments, changes in the fair value of long-term investments due to observable price changes in orderly transactions for an identical or similar investment, and the change in fair value of preferred stock warrants liability.

Upon completion of the Merger, the preferred stock warrants became exercisable into shares of common stock and will no longer continue to be remeasured at each reporting date.

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2025 2024 $ Change % Change

Research and development $ 29,801 $ 59,504 $ (29,703) (50) %

Selling, general and administrative 28,809 12,925 15,884 123 %

Other income (expense), net 8,842 2,282 6,560 287 %

Research and Development

Research and development expenses incurred for the year ended December 31, 2024 were primarily incurred to further refine the manufacturing process for LNZ100, while research and development expenses incurred for the year ended December 31, 2023 were substantially all related to the development of LNZ100 in our INSIGHT and CLARITY trials.

Research and development expenses decreased $29.7 million, or 50%, to $29.8 million for the year ended December 31, 2024 compared to $59.5 million for the year ended December 31, 2023.

The change was driven by decreases of $33.3 million in contract research expense for our clinical trials, as our Phase 3 CLARITY trials were substantially completed in March 2024, and $2.2 million in contract manufacturing expenses as we incurred higher shipping and labeling costs during the year ended December 31, 2023 to support our Phase 3 CLARITY trials, partially offset by increases of $3.0 million in employee salaries and related expenses due to increased non-clinical regulatory and CMC headcount, $1.8 million in contract regulatory consulting expenses associated with the preparation and filing of our NDA for LNZ100, and $0.5 million in nonclinical research expense.

Selling, General and Administrative

Product sales, net $ 1,588 $ — $ 1,588 N/A

License revenue 17,500 — 17,500 N/A

Cost of sales 418 — 418 N/A

Selling, general and administrative expenses

91,138 28,809 62,329 216 %

Research and development expenses 18,670 29,801 (11,131) (37) %

Other income, net 9,513 8,842 671 8 %

Product Sales, net

Product sales, net were initiated during the year ended December 31, 2025 due to the FDA approval of VIZZ in July 2025 and subsequent product sales beginning in October 2025.

Product sales, net for the year ended December 31, 2025 were primarily driven by approximately 20,000 paid prescriptions filled.

The Company had no product sales during the year ended December 31, 2024.

License Revenue

License revenue increased during the year ended December 31, 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 during the year ended December 31, 2024.

Cost of Sales

Cost of sales increased during the year ended December 31, 2025 due to cost of sales recognized in connection with sales of VIZZ.

There was no cost of sales during the year ended December 31, 2024.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased $62.3 million, or 216%, to $91.1 million for the year ended December 31, 2025 compared to $28.8 million for the year ended December 31, 2024.

Increases in the comparative period included $6.7 million in employee salaries and related expenses due to a rise in headcount, and $6.4 million in pre-commercial marketing, advertising and sales infrastructure expenses as we prepare for a potential commercial launch of LNZ100, subject to FDA approval.

Other Income (Expense), net

Increases in the comparative period included $31.3 million in employee salaries and related expenses due to a rise in headcount, including the hiring of our 88-territory sales force, $20.5 million in pre-commercial and commercial marketing, advertising and sales infrastructure as we prepared for and executed the commercial launch of VIZZ and initiated the associated DTC marketing campaign, $3.9

million in chemistry and control and regulatory related expenses which were classified as selling, general and administrative expenses subsequent to FDA approval, $2.9 million in travel expenses primarily related to our sales force and $2.8 million in other corporate overhead.

Research and Development Expenses

Research and development expenses incurred for the year ended December 31, 2025 were primarily incurred to further refine the manufacturing process for VIZZ, while research and development expenses incurred for the year ended December 31, 2024 were substantially all related to the development of VIZZ in our INSIGHT and CLARITY trials.

Research and development expenses decreased $11.1 million, or 37%, to $18.7 million for the year ended December 31, 2025 compared to $29.8 million for the year ended December 31, 2024.

The decrease was primarily driven by a $12.1 million decrease in clinical and nonclinical research expense for our clinical trials, and a $2.4 million decrease in contract regulatory consulting expenses associated with the prior period preparation and filing of our NDA for VIZZ, and a $1.0 million decrease in employee salaries and related expenses.

The decrease was partially offset by a $4.0 million increase in contingent product manufacturing costs incurred prior to FDA approval.

Other Income, net

Other income, net for the year ended December 31, 2025, was $9.5 million, compared to $8.8 million for the year ended December 31, 2024.

The increase was primarily driven by additional interest income earned on our cash, cash equivalents, and marketable securities of $6.4 million as a result of an overall increase in cash on-hand in 2024 over the comparative period, and an increase of $1.3 million in the fair value of the Company's equity investment without a readily determinable fair value, partially offset by a $1.2 million 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.

The increase was primarily driven by additional interest income earned on our cash, cash equivalents, and marketable securities of $1.2 million as a result of an overall increase in cash on-hand in 2025 over the comparative period.

During the year ended December 31, 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

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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, if approved.

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.

We expect to continue to incur significant expenses and operating losses in the early stages of the commercialization of VIZZ, including costs related to product sales, marketing, manufacturing, and distribution.

From inception through December 31, 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.

Under the Sales Agreement, we will set the parameters for the sale of shares, including the number or dollar amount of shares to be issued, the time period during which sales are requested to be made, limitations on the number or dollar amount of shares that may be sold in any one trading day and any minimum price below which sales may not be made.

Subject to the terms and conditions of the Sales Agreement, TD Cowen may sell the shares by methods deemed to be an “at the market” offering as defined in Rule 415 promulgated under the Securities Act of 1933, as amended.

We have no obligation to sell any shares under the Sales Agreement and may at any time suspend solicitation and offers under the Sales Agreement.

The shares will be issued pursuant to the Company’s 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 year ended December 31, 2025 , we sold an aggregate of 3,618,634 shares of common stock at a weighted-average price of $41.45 under the Sales Agreement, resulting in net proceeds of $147.7 million, utilizing the full capacity of the Sales Agreement.

Funding Requirements

We believe that our cash, cash equivalents, and marketable securities as of December 31, 2024 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 December 31, 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.

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Financing activities 149,745 199,002

Net decrease in cash and cash equivalents

$ (14,868) $ (9,301)

Net increase (decrease) in cash and cash equivalents $ 4,907 $ (14,868)

Net Cash Used in Operating Activities

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.

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

Net cash used in operating activities primarily results from net loss adjusted for non-cash expenses, changes in working capital components, costs to manufacture VIZZ and employee-related expenditures.

Cash flows from operating activities will continue to be impacted by commercialization activities for VIZZ, and will also be impacted by any potential future revenue from commercialization activities and licensing or distribution arrangements.

Cash flows will also continue to be affected by other operating and general administrative activities.

For the year ended December 31, 2025, cash used in operating activities was $69.2 million and resulted from a net loss of $82.1 million, in addition to cash outflows of $3.0 million in prepaid expenses and other current assets primarily due to an increase in deposits related to our DTC marketing campaign, and $4.3 million from inventory purchases.

The decrease in operating cash flows was offset by a $10.9 million increase in accounts payable and accrued liabilities due to the launch of our DTC marketing campaign, and $9.5 million in non-cash adjustments primarily driven by share-based compensation expense.

For the year ended December 31, 2024, cash used in operating activities was $59.4 million and resulted from a net loss of $49.8 million, in addition to a $11.7 million cash outflow from the payment of accounts payable and accrued liabilities associated with the Merger and accrued clinical activities, offset by $3.5 million in non-cash adjustments primarily driven by share-based compensation expense and the change in the fair value of preferred warrants.

For the year ended December 31, 2023, cash used in operating activities was $60.4 million primarily resulting from a net loss of $70.0 million and partially offset by a $8.6 million increase in accounts payable and accrued liabilities.

Net Cash Used in Investing Activities

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Net Cash Provided by Financing Activities

For the year ended December 31, 2025, cash provided by financing activities was $149.7 million, primarily driven by $147.7 million in net proceeds from common stock sold under the Sales Agreement and $2.0 million in net cash proceeds from exercises of stock options and issuances of common stock under the employee stock purchase plan.

For the year ended December 31, 2024, cash provided by financing activities was $199.0 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 $4.0 million in net cash proceeds from exercises of stock options.

For the year ended December 31, 2023, cash provided by financing activities was $80.7 million, primarily due to $83.0 million in proceeds from the sale by LENZ OpCo of Series B Convertible Preferred Stock, offset by an increase in deferred offering costs of $2.5 million related to the Merger.

Material Cash Requirements from Contractual Obligations

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See Note 8 to our consolidated financial statements included in this Annual Report on Form 10-K 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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We believe that the estimates, judgments and assumptions are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made.

To the extent there are material differences between these estimates, judgments or assumptions and actual results, our consolidated financial statements will be affected.

To the extent there are material differences between these estimates, judgments or assumptions and

actual results, our consolidated financial statements will be affected.

Historically, revisions to our estimates have not resulted in a material change to our consolidated financial statements.

While our significant accounting policies are described in more detail in the notes to our consolidated financial statements included in this Annual Report on Form 10-K, we believe the following accounting policies to be most critical to the judgments and estimates used in the preparation of our consolidated financial statements.

Stock-Based Compensation Expense

Stock-based compensation expense represents the cost of the grant date fair value of equity awards recognized over the requisite service period of the awards (usually the vesting period) on a straight-line basis.

Revenue Recognition

Product Sales, net

To date, product sales, net has consisted of sales of VIZZ to (i) certain wholesalers (who in turn sell VIZZ to retail pharmacies) and (ii) directly to patients through the our e-pharmacy partner.

Product sales, net is recognized net of reserves for variable components, including but not limited to distribution service fees, prompt pay discounts and product returns.

These variable components are reassessed each reporting period, and adjustments are recorded on a cumulative catch-up basis, which affects product sales, net in the period of adjustment.

The actual amounts of variable consideration ultimately received may differ from our estimates.

To date, actual amounts have not differed materially from our estimates.

Share-Based Compensation Expense

Share-based compensation expense represents the cost of the grant date fair value of equity awards recognized over the requisite service period of the awards (usually the vesting period) on a straight-line basis.

We estimate the fair value of equity awards using the Black-Scholes option pricing model and recognize forfeitures as they occur.

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We determine the inputs and assumptions to the Black-Scholes option pricing model in the following manner:

Fair Value of Common Stock —Prior to the Merger, since there was no public market for our common stock, our board of directors, with input from management, determined the fair value of our common stock on each grant date by considering a number of objective and subjective factors, including input from management and valuations of our common stock by a third-party valuation firm.

Following the Merger, the fair market value of our common stock is based on its closing price as reported on the date of grant on the primary stock exchange on which our common stock is traded, adjusted for special dividends, if any.

Fair Value of Common Stock —The fair market value of our common stock is based on its closing price as reported on the date of grant on the primary stock exchange on which our common stock is traded, adjusted for special dividends, if any.

Expected Term —The Company uses the simplified method as prescribed by the Securities and Exchange Commission Staff Accounting Bulletin No.

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

Risk-Free Interest Rate —The risk-free interest rate is based on a United States Treasury instrument whose term is consistent with the expected term of the stock options.

Risk-Free Interest Rate —The risk-free interest rate is based on a U.S.

Treasury instrument whose term is consistent with the expected term of the stock options.

Expected Dividend Yield —The expected dividend yield is based on the Company’s historical and expected dividend payouts.

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For so long as we remain an emerging growth company, we are permitted and intend to rely on certain exemptions from various public company disclosure and reporting requirements, including not being required to have our internal control over financial reporting audited by our independent registered public accounting firm pursuant to Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and any golden parachute payments not previously approved.

Accordingly, the information we disclose in our SEC filings may not be comparable with the information stockholders receive from other public companies in which they may hold stock.

Accordingly, the information we

disclose in our SEC filings may not be comparable with the information stockholders receive from other public companies in which they may hold stock.

Additionally, under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies.

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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