Larimar Therapeutics, Inc. 10-Q

Item 1 Financial Statements (unaudited) 3 Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025 3 Condensed Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2026 and 2025 4 Condensed Consolidated Statements of Changes in Stockholders' Equity for the three months ended March 31, 2026 and 2025 5 Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025 7 Notes to Condensed Consolidated Financial Statements 8 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 22 Item 3. Quantitative and Qualitative Disclosures About Market Risk 30 Item 4. Controls and Procedures 30 PART II - OTHER INFORMATION Item 1. Legal Proceedings 31 Item 1A. Risk Factors 31 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 31 Item 3. Defaults Upon Senior Securities 31 Item 4. Mine Safety Disclosures 31 Item 5. Other Information 31 Item 6. Exhibits 32 Signatures 33 2 PART I-FINANCIA L INFORMATION Item 1. Financi al Statements LARIMAR THERAPEUTICS, INC. CONDENSED CONSOLIDAT ED BALANCE SHEETS (In thousands, except share and per share data) (Unaudited) March 31, December 31, 2026 2025 Assets Current assets: Cash and cash equivalents $ 177,913 $ 85,412 Marketable securities 22,472 51,440 Prepaid expenses and other current assets 4,592 5,170 Total current assets 204,977 142,022 Property and equipment, net 558 622 Operating lease right-of-use assets 1,866 2,069 Restricted cash 606 606 Other assets 504 523 Total assets $ 208,511 $ 145,842 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 8,576 $ 5,216 Accrued expenses 38,123 58,474 Operating lease liabilities, current 1,058 1,105 Total current liabilities 47,757 64,795 Operating lease liabilities 2,721 2,962 Total liabilities 50,478 67,757 Commitments and contingencies (See Note 8) Stockholders’ equity: Preferred stock; $ 0.001 par value per share; 5,000,000 shares authorized as of March 31, 2026 and December 31, 2025; 500,000 and 250,000 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively 1 — Common stock, $ 0.001 par value per share; 115,000,000 shares authorized as of March 31, 2026 and December 31, 2025; 103,882,937 and 83,090,392 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively 103 83 Additional paid-in capital 622,367 512,779 Accumulated deficit ( 464,444 ) ( 434,831 ) Accumulated other comprehensive gain 6 54 Total stockholders’ equity 158,033 78,085 Total liabilities and stockholders’ equity $ 208,511 $ 145,842 The accompanying notes are an integral part of these condensed consolidated financial statements. 3 LARIMAR THERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (In thousands, except share and per share data) (Unaudited) Three Months Ended March 31, 2026 2025 Operating expenses: Research and development $ 25,031 $ 26,552 General and administrative 6,086 4,636 Total operating expenses 31,117 31,188 Loss from operations ( 31,117 ) ( 31,188 ) Other income, net 1,504 1,907 Net loss $ ( 29,613 ) $ ( 29,281 ) Comprehensive loss: Net loss $ ( 29,613 ) $ ( 29,281 ) Other comprehensive loss: Unrealized loss on marketable securities ( 48 ) ( 94 ) Total other comprehensive loss ( 48 ) ( 94 ) Total comprehensive loss $ ( 29,661 ) $ ( 29,375 ) Basic and diluted net loss per share: Common stock $ ( 0.31 ) $ ( 0.46 ) Preferred stock ( 3.14 ) — Weighted-average shares used in computing basic and diluted net loss per share: Common stock 89,814,820 63,964,008 Preferred stock 441,667 — The accompanying notes are an integral part of these condensed consolidated financial statements. 4 LARIMAR THERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS O F CHANGES IN STOCKHOLDERS’ EQUITY (In thousands, except share data) (Unaudited) Additional Other Total Preferred Stock Common Stock Paid-in Accumulated Comprehensive Stockholders’ Shares Par Value Shares Par Value Capital Deficit Gain (Loss) Equity Balances as of December 31, 2025 250,000 $ — 83,090,392 $ 83 $ 512,779 $ ( 434,831 ) $ 54 $ 78,085 Issuance of common stock, net of issuance costs — — 23,000,000 23 107,593 — — 107,616 Issuance of preferred stock in exchange for common stock 250,000 1 ( 2,500,000 ) ( 3 ) 2 — — — Vesting of restricted stock units — — 288,545 — — — — — Exercise of stock options — — 4,000 — 14 — — 14 Stock-based compensation expense — — — — 1,979 — — 1,979 Unrealized loss on marketable debt securities — — — — — — ( 48 ) ( 48 ) Net Loss — — — — — ( 29,613 ) — ( 29,613 ) Balances as of March 31, 2026 500,000 $ 1 103,882,937 $ 103 $ 622,367 $ ( 464,444 ) $ 6 $ 158,033 The accompanying notes are an integral part of these condensed consolidated financial statements. 5 LARIMAR THERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (In thousands, except share data) (Unaudited) (Continued) Additional Other Total Common Stock Paid-in Accumulated Comprehensive Stockholders’ Shares Par Value Capital Deficit Gain (Loss) Equity Balances as of December 31, 2024 63,815,065 $ 64 $ 440,758 $ ( 269,158 ) $ 148 $ 171,812 Vesting of restricted stock units 212,827 — — — — — Stock-based compensation expense — — 1,834 — — 1,834 Unrealized loss on marketable securities — — — — ( 94 ) ( 94 ) Net loss — — — ( 29,281 ) — ( 29,281 ) Balances as of March 31, 2025 64,027,892 $ 64 $ 442,592 $ ( 298,439 ) $ 54 $ 144,271 The accompanying notes are an integral part of these condensed consolidated financial statements. 6 LARIMAR THERAPEUTICS, INC. CONDENSED CONSOLIDATED ST ATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Three Months Ended March 31, 2026 2025 Cash flows from operating activities: Net loss $ ( 29,613 ) $ ( 29,281 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense 1,979 1,834 Lease expense ( 85 ) ( 60 ) Depreciation expense 64 88 Amortization of premium on marketable securities ( 80 ) ( 755 ) Changes in operating assets and liabilities: Prepaid expenses and other current assets 578 3,891 Accounts payable 2,925 ( 150 ) Accrued expenses ( 20,401 ) ( 2,121 ) Other assets 19 14 Net cash used in operating activities: ( 44,614 ) ( 26,540 ) Cash flows from investing activities: Purchases of property and equipment — ( 49 ) Purchases of marketable securities — ( 52,503 ) Maturities of marketable securities 29,000 67,000 Net cash provided by (used in) investing activities 29,000 14,448 Cash flows from financing activities: Proceeds from issuance of equity securities 108,101 — Proceeds from exercise of stock options 14 — Net cash provided by financing activities 108,115 — Net increase in cash, cash equivalents and restricted cash 92,501 ( 12,092 ) Cash, cash equivalents and restricted cash at beginning of period 86,018 33,824 Cash, cash equivalents and restricted cash at end of period $ 178,519 $ 21,732 Supplemental disclosure of non-cash investing and financing activities: Purchases of property and equipment included in accounts payable and accrued expenses $ — $ 13 Offering costs included in accounts payable and accrued expense $ 585 $ 50 The accompanying notes are an integral part of these condensed consolidated financial statements. 7 LARIMAR THERAPEUTICS, INC. NOTES TO CONDENSED CONSOLID ATED FINANCIAL STATEMENTS (Unaudited) 1. Description of Business and Basis of Presentation Larimar Therapeutics, Inc., together with its subsidiary (the “Company” or “Larimar”), is a clinical-stage biotechnology company focused on developing treatments for patients suffering from complex rare diseases using its novel cell penetrating peptide technology platform. Larimar's lead product candidate, nomlabofusp, is a subcutaneously administered, recombinant fusion protein intended to deliver human frataxin (“FXN”), an essential protein, to the mitochondria of patients with Friedreich's Ataxia (“FA”). FA is a rare, progressive, and fatal disease in which patients are unable to produce sufficient FXN due to a genetic abnormality. Basis of Presentation The condensed consolidated financial statements include the accounts of Larimar and its wholly owned subsidiary. All intercompany balances and transactions have been eliminated. The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”). The consolidated balance sheet as of December 31, 2025 was derived from the Company’s audited financial statements but does not include all disclosures required by GAAP. The accompanying unaudited condensed consolidated financial statements as of March 31, 2026 and for the three months ended March 31, 2026 and 2025, have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 19, 2026. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s condensed consolidated financial position as of March 31, 2026, condensed consolidated results of operations for the three months ended March 31, 2026 and condensed consolidated statement of cash flows for the three months ended March 31, 2026 have been made. The results of operations for the three months ended March 31, 2026 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2026 . Liquidity and Capital Resources The Company’s condensed consolidated financial statements have been presented on the basis that it will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. Since its inception, the Company has incurred significant recurring operating losses and negative cash flows from operations. The Company has incurred net losses of $ 29.6 million and $ 29.3 million for the three months ended March 31, 2026 and 2025, respectively. In addition, as of March 31, 2026, the Company had an accumulated deficit of $ 464.4 million . The Company expects to continue to generate operating losses for the foreseeable future. As of March 31, 2026, the Company had approximately $ 200.4 million of cash, cash equivalents and marketable securities available for use to fund its operations and capital requirements. The Company has funded its operations to date primarily with proceeds from sales of common stock and proceeds from the sale of prefunded warrants for the purchase of common stock, the acquisition in 2020 of cash, cash equivalents and marketable securities upon the merger with Zafgen, Inc. (“Zafgen”) and, prior to the 2020 merger with Zafgen, capital contributions from Chondrial Holdings, LLC. In July 2025, the Company completed an underwritten public offering of common stock raising net proceeds of approximately $ 65.0 million. 8 In February 2026, the Company completed an underwritten public offering of common stock raising net proceeds of approximately $ 107.6 million. In accordance with Accounting Standards Update (“ASU”) No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”, the Company has evaluated whether there are certain conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these condensed consolidated financial statements are issued. As of the issuance date of these condensed consolidated financial statements, the Company expects its cash, cash equivalents and marketable securities will be sufficient to fund its forecasted operating expenses and capital expenditure requirements for at least twelve months from the date these financial statements are issued. The Company has not yet commercialized any products and its ability to commercialize nomlabofusp is dependent on receiving regulatory approval in the United States and/or other countries. The Company expects that its research and development, general and administrative and commercial expenses will continue to increase and, as a result, that it may need additional capital to fund its future operating and capital requirements. Unless and until the Company can generate substantial revenue, management continuously evaluates different strategies to obtain the required funding for future operations. These strategies include seeking additional funding through a combination of public or private equity offerings, debt or royalty financings, collaborations and licensing arrangements, strategic partnerships with pharmaceutical and/or larger biotechnology companies, or other sources. The incurrence of indebtedness would result in increased payment obligations and the Company may be required to agree to certain restrictive covenants, such as limitations on its ability to incur additional debt, limitations on its ability to acquire, sell or license intellectual property rights, minimum required cash balances and other operating restrictions that could adversely impact the Company's ability to conduct its business. Any additional fundraising efforts may divert the Company's management from their day-to-day activities, which may adversely affect its ability to develop and commercialize its product candidates. There can be no assurance that the Company would be able to raise sufficient additional capital on acceptable terms, if at all. If such additional financing is not available on satisfactory terms, or is not available in sufficient amounts, or if the Company does not have sufficient authorized shares, the Company may be required to delay, limit, or eliminate the development of business opportunities and its ability to achieve its business objectives, its competitiveness, and its business, financial condition, and results of operations will be materially adversely affected. The Company could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage than otherwise would be desirable and it may be required to relinquish rights to some of its technologies or product candidates or otherwise agree to terms unfavorable to it, any of which may have a material adverse effect on the Company's business, operating results and prospects. In addition, geopolitical tensions (including the war in the Middle East and other regional conflicts around the world), volatility of capital markets, and other adverse macroeconomic events, including those due to inflationary pressures, rising interest rates, tariff or trade protection measures that have been or may in the future be imposed by the U.S. or other countries, bank instability and the ability of the U.S. government to manage federal debt limits as well as the potential impact of other health crises on the global financial markets may reduce the Company's ability to access capital, which could negatively affect its liquidity and ability to continue as a going concern. If the Company is unable to obtain sufficient funding when needed and/or on acceptable terms, the Company may be required to significantly curtail, delay or discontinue one or more of its research and development programs, the manufacture of clinical and commercial supplies, product portfolio expansion, commercialization efforts and/or commercial operations, which could adversely affect its business prospects, or the Company may be unable to continue operations. If the timing of the Company's clinical assumptions are delayed or if there are other forecasted assumption changes that negatively impact its operating plan, the Company would reduce expenditures in order to further extend cash resources. 9 2. Summary of Significant Accounting Policies Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. This process involves reviewing open contracts and purchase orders, communicating with our personnel and outside vendors to identify services that have been performed on our behalf and estimating the level of service performed and the associated costs incurred for the services when we have not yet been invoiced or otherwise notified of the actual costs. Significant estimates and assumptions reflected in these condensed consolidated financial statements include, but are not limited to, the accrual of research and development expense, the recording as prepaid expense of payments made in advance of the actual provision of goods or services, valuation of stock-based awards and valuation of leases. Due to inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in these estimates. On an ongoing basis, the Company evaluates its estimates and assumptions. Research and Development Costs Costs associated with internal research and development and external research and development services, including drug development, clinical studies and non-clinical studies, are expensed as incurred. Research and development expenses include costs for salaries, employee benefits, subcontractors, facility-related expenses, depreciation, stock-based compensation, third-party license fees, laboratory supplies, and external costs of outside vendors engaged to conduct discovery, non-clinical and clinical development activities and clinical trials as well as to manufacture clinical trial materials, and other costs. The Company recognizes external research and development costs based on an evaluation of the progress to completion of specific tasks using information provided to the Company by its key service providers. Nonrefundable advance payments for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses. Such prepaid expenses are recognized as an expense when the goods have been delivered or the related services have been performed, or when it is no longer expected that the goods will be delivered, or the services rendered. Upfront payments, milestone payments and annual maintenance fees under license agreements are currently expensed in the period in which they are incurred. Patent Costs All patent-related costs incurred in connection with filing and prosecuting patent applications are expensed as incurred due to the uncertainty about the recovery of the expenditure. Amounts incurred are classified as general and administrative expenses. Stock-Based Compensation The Company measures all stock-based awards granted to employees and directors based on the fair value on the date of grant using the Black-Scholes option-pricing model. Compensation expense of those awards is recognized over the requisite service period, which is the vesting period of the respective award. Typically, the Company issues awards with only service-based vesting conditions and records the expense for these awards using the straight-line method. The Company accounts for forfeitures as they occur. The Company classifies stock-based compensation expense in its consolidated statements of operations and comprehensive loss in the same manner in which the award recipient’s payroll costs are classified or in which the award recipient’s service payments are classified. Prior to May 28, 2020, the Company had been a private company and lacked company-specific historical and implied volatility information for its common stock. Prior to January 1, 2023, the Company estimated its expected common stock price volatility solely based on the historical volatility of publicly traded peer companies. Beginning on January 1, 2023, based on the availability of sufficient historical trading data of the Company's own common stock on the Nasdaq Global Market to calculate accurately its volatility, the Company began blending its volatility starting from June 2020 (following its merger with Zafgen in 2020) to the date of each stock-based award, and weighing the volatility of its peer group for the amount of time from May 31, 2020 backwards so that the blended volatility equals the expected term of the related stock-based award. The expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The 10 risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield considers the fact that the Company has never paid cash dividends on common stock and does not expect to pay any cash dividends in the foreseeable future. Segment Information Operating segments are defined as components of an enterprise for which separate discrete information is available for evaluation by the chief operating decision maker, or decision making group, in deciding how to allocate resources in assessing performance. The Company is managed on a consolidated basis and has one operating and reportable segment related to the development of clinical and preclinical product candidates for the development of the Company’s proprietary new therapies, primarily nomlabofusp, the Company's life science segment. The Company’s chief operating decision maker (“CODM”) is the Company's chief executive officer (“CEO”). The accounting policies of the life science segment are the same as those described in the summary of significant accounting policies. The CODM assesses performance for the Company and its reportable segment based on net loss, which is reported on the consolidated Statements of Operations. The measure of segment assets is reported on the balance sheet as total consolidated assets. All long-lived assets are located in the U.S. To date, the Company has not generated any product revenue. The Company expects to continue to incur significant expenses and operating losses for the foreseeable future as it advances product candidates through all stages of development and clinical trials and regulatory approval. The CODM uses consolidated financial information, including consolidated net loss, to evaluate performance, forecast future period financial results, allocate resources for the company by, among other things, comparing budgeted to actual results. The table below summarizes the significant expense categories regularly provided to the CODM for the three months ended March 31, 2026 and 2025: For the Three Months Ended March 31, 2026 2025 Operating expenses: Technical operations $ 12,087 $ 15,307 Development (a) 11,337 9,609 Nomlabofusp support 1,607 1,636 General and administrative (b) 4,978 4,146 Commercial (c) 1,108 490 Total operating expenses $ 31,117 $ 31,188 Other income, net ( 1,504 ) ( 1,907 ) Net loss $ ( 29,613 ) $ ( 29,281 ) (a) Development expenses include research and development related stock compensation expense of approximately $ 1.0 million and $ 0.9 million for the three months ended March 31, 2026 and 2025, respectively. (b) General and administrative expenses include general and administrative related stock compensation expense of approximately $ 1.0 million and $ 0.9 million for the three months ended March 31, 2026 and 2025, respectively. (c) Commercial expenses relate to commercial readiness activities. Recently Issued and Adopted Accounting Pronouncements From time to time, new accounting guidance is issued by the FASB or other standard setting bodies that is adopted by us as of the effective date or, in some cases where early adoption is permitted, in advance of the effective date. We have assessed the recently issued guidance that is not yet effective and believe the new guidance will not have a material impact on the consolidated results of operations, cash flows or financial position. 11 Recently Issued Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, which requires disaggregated disclosures in the notes of the financial statements of certain categories of expenses that are included in expense line items on the face of the income statement. This ASU is effective for annual periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company will evaluate the impact adopting ASU 2024-03 will have on the Company's consolidated financial statements and disclosures . Income Taxes We recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. We record valuation allowances to reduce deferred tax assets to the amount we believe is more likely than not to be realized. During the three months ended March 31, 2026 and 2025 , the Company recorded no income tax benefits for the net operating losses incurred in each period due to the uncertainty of realizing a benefit from those items. 3. Fair Value Measurements and Marketable Securities Fair Value Measurements The Company’s assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025 are measured in accordance with the standards of ASC 820,“ Fair Value Measurements and Disclosures ”, which establishes a three-level valuation hierarchy for measuring fair value and expands financial statement disclosures about fair value measurements. The valuation hierarchy is based on the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level – 1 Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level – 2 Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level – 3 Inputs to the valuation methodology are unobservable and significant to the fair value measurement. The Company’s financial instruments consist primarily of cash, cash equivalents, marketable securities, accounts payable and accrued liabilities. For accounts payable and accrued liabilities, the carrying amounts of these financial instruments as of March 31, 2026 and December 31, 2025 were considered representative of their fair values due to their short term to maturity. 12 The following tables summarize the Company’s cash equivalents and marketable securities as of March 31, 2026 and December 31, 2025: Total Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) March 31, 2026 Cash equivalents: Money market funds invested in government securities $ 168,275 $ 168,275 $ — $ — Total cash equivalents 168,275 168,275 — — Marketable securities: U.S. Government securities 22,472 — 22,472 — Total marketable securities 22,472 — 22,472 — Total cash equivalents and marketable securities $ 190,747 $ 168,275 $ 22,472 $ — December 31, 2025 Cash equivalents: Money market funds invested in government securities $ 78,930 $ 78,930 $ — $ — Total cash equivalents 78,930 78,930 — — Marketable securities: U.S. Government securities 51,440 — 51,440 — Total marketable securities 51,440 — 51,440 — Total cash equivalents and marketable securities $ 130,370 $ 78,930 $ 51,440 $ — The accrued interest receivable related to the Company’s investments was $ 0.8 million and $ 0.7 million as of March 31, 2026 and December 31, 2025, respectively, and is included in prepaid expenses and other current assets on the condensed consolidated balance sheet. The Company classifies its money market funds and U.S. treasury bills, which are valued based on quoted market prices in active markets with no valuation adjustment, as Level 1 assets within the fair value hierarchy. The Company classifies its investments in U.S. government and agency securities, corporate commercial paper, and corporate bonds, if any, as Level 2 assets within the fair value hierarchy. The fair values of these investments are estimated by taking into consideration valuations obtained from third-party pricing services. The pricing services utilize industry standard valuation models, including both income- and market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities, prepayment/default projections based on historical data and other observable inputs. As of March 31, 2026 and December 31, 2025, the unrealized losses for available-for-sale investments were non-credit related, and the Company does not intend to sell the investments that were in an unrealized loss position, nor will it be required to sell those investments before recovery of their amortized cost basis, which may be maturity. As of March 31, 2026 and December 31, 2025 , no allowances for credit losses for the Company’s investments were recorded. During the three months ended March 31, 2026 and 2025 , the Company did no t recognize any impairment losses related to investments. As of March 31, 2026 and December 31, 2025, the Company's cash equivalents and marketable securities consisted of a U.S. government money market fund, U.S. Treasury Bills and U.S. government and agency securities, 13 all held in our name in a separate custody account with U.S. Bank. The U.S. government money market fund has same-day liquidity access and the U.S. government and agency securities all have maturities of 360 days or less. Marketable Securities The following table summarizes the Company's marketable securities as of March 31, 2026 and December 31, 2025: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (in thousands) March 31, 2026 Assets: U.S. Government securities $ 22,466 6 $ 22,472 Total marketable securities $ 22,466 $ 6 $ — $ 22,472 December 31, 2025 Assets: U.S. Government securities $ 51,386 54 — $ 51,440 Total marketable securities $ 51,386 $ 54 $ — $ 51,440 As of March 31, 2026 and December 31, 2025 , the Company held no investments that have been in a continuous loss position for 12 months or longer. 4. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: March 31, December 31, 2026 2025 (in thousands) Prepaid research and development expenses $ 3,146 $ 3,666 Interest receivable 791 747 Prepaid insurance 401 504 Other prepaid expenses and other assets 254 253 $ 4,592 $ 5,170 5. Fixed Assets Fixed assets, net consisted of the following: March 31, December 31, Useful Life 2026 2025 (in thousands) Computer equipment 5 years $ 130 $ 130 Lab equipment 5 years 1,737 1,737 Furniture and fixtures 7 years 555 555 Leasehold improvements lease term 93 93 2,515 2,515 Less: Accumulated depreciation ( 1,957 ) ( 1,893 ) $ 558 $ 622 Depreciation expense was $ 0.1 million for the three months ended March 31, 2026 and 2025, respectively. In addition, for the three months ended March 31, 2026 and 2025 , there was less than $ 0.1 million of depreciation related to sublet assets recorded as other expense. 14 6. Accrued Expenses Accrued expenses consisted of the following: March 31, December 31, 2026 2025 (in thousands) Accrued research and development expenses $ 35,606 $ 53,914 Accrued payroll and related expenses 1,257 3,783 Accrued other 1,260 777 $ 38,123 $ 58,474 7. Stockholders’ Equity and Stock Options Common Stock As of March 31, 2026 , the Company’s Ninth Amended and Restated Certificate of Incorporation, as amended, authorized the Company to issue up to 115,000,000 shares of common stock, par value $ 0.001 per share, of which 103,882,937 shares were issued and outstanding, and up to 5,000,000 shares of undesignated preferred stock, par value $ 0.001 per share, of which 500,000 shares were issued or outstanding. The voting, dividend and liquidation rights of the holders of the Company’s common stock are subject to and qualified by the rights, powers and preferences of the holders of the preferred stock. Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to receive dividends, as may be declared by the board of directors of the Company (the “Board”), if any. No cash dividends have been declared or paid to date. In July 2025, the Company sold 21,562,500 shares of its common stock in an underwritten public offering at a price of $ 3.20 per share and received net proceeds of approximately $ 65.0 million. In February 2026, the Company sold 23,000,000 shares of its common stock in an underwritten public offering at a price of $ 5.00 per share and received net proceeds of approximately $ 107.6 million. ATM Agreement In May 2024, the Company entered into a sales agreement (the "ATM Agreement") with Guggenheim Securities, LLC in connection with the establishment of an “at-the-market” offering program under which the Company could sell up to an aggregate of $ 100 million of shares of common stock (the “ATM Shares”) from time to time. To date, no sales of common stock have been made under this ATM Agreement. Preferred Stock In December 2025, the Company entered into an exchange agreement (the “Exchange Agreement”) with Blue Owl Healthcare Opportunities IV Public Investments LP (the “Stockholder”) pursuant to which the Stockholder exchanged 2,500,000 shares of the Company’s common stock for 250,000 shares of newly designated Series A Convertible Preferred Stock of par value $ 0.001 per share ( the “Series A Preferred Stock”). In January 2026, the Stockholder exchanged an additional 2,500,000 shares of the Company’s common stock for an additional 250,000 shares of Series A Preferred Stock. Each share of the Series A Preferred Stock will be convertible into ten shares of common stock at the option of the holder at any time, subject to certain limitations, including that the holder will be prohibited from converting preferred stock into common stock if, as a result of such conversion, the holder, together with its affiliates, would beneficially own a number of shares of common stock more than 9.99 % of the total common stock then issued and outstanding immediately following the conversion of such shares of Series A Preferred Stock. Holders of the Series A Preferred Stock are permitted to increase this percentage to an amount not to exceed 19.99 % upon 60 days’ notice. Shares of Series A Preferred Stock will generally have no voting rights , except as required by law and except that the consent of a majority of the holders of the outstanding Series A Preferred Stock will be required to amend the terms of the preferred stock. In the event of the Company’s liquidation, dissolution or winding up, holders of Series A Preferred Stock will participate pari passu with any distribution of proceeds to holders of common stock, calculated on an as-converted basis. Holders of preferred stock are entitled to receive when, as, and if dividends are 15 declared and paid on the common stock, an equivalent dividend, calculated on an as-converted basis. Shares of Series A Preferred Stock are otherwise not entitled to dividends. The Series A Preferred Stock ranks on parity with the common stock and any class or series of capital stock of the Company created specifically ranking by its terms on parity with the preferred stock. Additionally, it ranks senior to any class or series of capital stock of the Company hereafter created specifically ranking by its terms junior to the preferred stock and junior to any class or series of capital stock of Larimar created specifically ranking by its terms senior to any preferred stock, in each case, as to distributions of assets upon liquidation, dissolution or winding up of the Company, whether voluntarily or involuntarily. 2020 Equity Incentive Plan The Board adopted the 2020 Equity Incentive Plan (the“2020 Plan”) on July 16, 2020 and the stockholders of the Company approved the 2020 Plan on September 29, 2020. The 2020 Plan replaced the predecessor plans (the (“Prior Plans”) that the Company assumed following its merger with Zafgen in May 2020. Options outstanding under the Prior Plans will remain outstanding, unchanged, and subject to the terms of the Prior Plans and the respective award agreements, and no further awards will be made under the Prior Plans. However, if any award previously granted under the Prior Plans, expires, terminates, is canceled, or is forfeited for any reason after the approval of the 2020 Plan, the shares subject to that award will be added to the 2020 Plan share pool so that they can be utilized for new grants under the 2020 Plan. The 2020 Plan provides for the grant of incentive stock options (“ISOs”), nonstatutory stock options (“NSOs”), stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based restricted stock units, and cash or other stock-based awards. ISOs may be granted only to the Company’s employees, including the Company’s officers, and the employees of the Company’s affiliates. All other awards may be granted to the Company’s employees, including the Company’s officers, the Company’s non-employee directors and consultants, and the employees and consultants of the Company’s affiliates. The maximum number of shares that may be issued in respect of any awards under the 2020 Plan is the sum of: (i) 1,700,000 shares plus (ii) an annual increase on January 1, 2021 and each anniversary of such date thereafter through January 1, 2030, equal to the lesser of (A) 4 % of the shares issued and outstanding on the last day of the immediately preceding fiscal year, or (B) such smaller number of shares as determined by the Board (collectively, the “Plan Limit”). The maximum aggregate number of shares that may be issued under the 2020 Plan is 8,000,000 over the ten-year term of the 2020 Plan. As permitted by the 2020 Plan, the Company added 3,323,616 and 2,552,603 shares available for grant to the 2020 Plan on January 1, 2026 and January 1, 2025, respectively. As of March 31, 2026 , 1,326,303 shares of common stock were available for grant under the 2020 Plan. During the three months ended March 31, 2026 and twelve months ended December 31, 2025 , options to purchase 416 and 1,333 shares, respectively, issued under the Prior Plans were cancelled and became available for grant under the 2020 Plan. Stock Option Valuation The following table presents, on a weighted average basis, the assumptions used in the Black-Scholes option-pricing model to determine the grant-date fair value of stock options granted to employees during the three months ended March 31, 2026: March 31, 2026 Risk-free interest rate 3.95 % Expected term (in years) 6.25 Expected volatility 97 % Dividend yield 0.00 % 16 Stock Options The following table summarizes the Company’s stock option activity for the three months ended March 31, 2026 (amounts in millions, except for share, contractual term, and per share data): Weighted Weighted Average Aggregate Average Remaining Intrinsic Number of Exercise Contractual Value (a) Shares Price Term (in years) (in millions) Outstanding as of December 31, 2025 8,535,772 $ 6.51 7.2 Options granted 2,146,290 3.61 Options exercised ( 4,000 ) 3.48 Options forfeited/expired ( 100,461 ) 5.64 Outstanding as of March 31, 2026 10,577,601 $ 5.93 7.5 $ 5.8 Exercisable as of March 31, 2026 5,416,292 $ 7.90 6.2 $ 1.5 Vested and expected to vest as of March 31, 2026 10,577,601 $ 5.93 7.5 $ 5.8 (a) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair value of the common stock for the options that were (“In the money”) as of March 31, 2026 . Option Grants During the three months ended March 31, 2026 , the Company granted options to purchase 2,146,290 shares of common stock to employees and directors under the 2020 Plan. The options have an exercise price equal to the closing stock price as of the grant date and vest over four years , with 25 % vesting on the first anniversary of the grant and the remainder vesting in equal monthly installments thereafter. The weighted-average grant date fair value of options granted under the 2020 Plan during the three months ended March 31, 2026 was $ 2.89 . As of March 31, 2026 , total unrecognized compensation expense related to unvested stock options granted under the 2020 Plan was $ 15.0 million, which is expected to be recognized over a weighted average period of 2.58 years. Inducement Stock Option Grant There were no inducement awards granted in the three months ended March 31, 2026. As of March 31, 2026 , total unrecognized compensation expense related to unvested inducement options granted was $ 0.3 million, which is expected to be recognized over a weighted average period of 1.06 years. Restricted Stock Units RSUs are granted under the 2020 Plan to certain of the Company's employees in order to retain key employees. The value of an RSU award is based on the Company's stock price on the date of grant. The shares underlying the RSUs are not issued until the RSUs vest. 17 Activity with respect to the Company's RSUs and performance-based RSUs during the three months ended March 31, 2026 was as follows (in millions, except share, contractual term, and per share data): Weighted Weighted Average Aggregate Average Remaining Intrinsic Number of Grant Date Contractual Value (a) Shares Fair Value Term (in years) (in millions) Outstanding as of December 31, 2025 1,000,518 $ 4.03 1.2 Restricted stock units granted 527,190 3.60 Restricted stock units vested ( 288,545 ) 4.37 Restricted stock units forfeited ( 9,904 ) 3.62 Outstanding as of March 31, 2026 1,229,259 $ 3.77 1.8 $ 5.5 Unvested and expected to vest as of March 31, 2026 1,229,259 $ 3.77 1.8 $ 5.5 Restricted Stock Unit Grants During the three months ended March 31, 2026 , the Company granted 527,190 shares of RSUs to employees under the 2020 Plan. The RSUs vest annually over four years and have a weighted-average grant date fair value of $ 3.60 per unit. As of March 31, 2026 , total unrecognized compensation expense for RSUs was $ 3.6 million, which is expected to be recognized over a weighted average period of 2.86 years. Performance-Based Restricted Stock Unit Grants In January 2025, the Company granted performance-based RSUs (the “January 2025 PSU Awards”) to each of the four executive officers of the Company under the 2020 Plan. Each award was expressed as a target number of RSUs. With respect to the January 2025 PSU Awards, the Board established specified regulatory-related performance criteria and a corresponding performance period over which such performance criteria must be achieved, the satisfaction of which are conditions to earning the January 2025 PSU Awards and vesting of the underlying RSUs. As of March 31, 2026 , the January 2025 PSU Awards were outstanding covering 200,000 common stock underlying RSUs. The grant date fair value of the performance-based RSUs was $ 3.46 per unit based on the grant date closing price per share. As of March 31, 2026 , the underlying performance criteria of the January 2025 PSU Awards were determined to be not probable of achievement for accounting purposes, and no stock-based compensation expense was recognized for the three months ended March 31, 2026 and 2025. Stock-Based Compensation Stock-based compensation expense was classified in the condensed consolidated statements of operations as follows: Three Months Ended March 31, 2026 2025 Research and development $ 1,020 $ 926 General and administrative 959 908 $ 1,979 $ 1,834 8. Commitments and Contingencies Intellectual Property Licenses The Company is party to an exclusive License Agreement (the "IU License"), dated November 30, 2016, as amended, with Indiana University (“IU”). Such agreement provides for a transferable, worldwide license to certain patent rights regarding technology used by the Company with respect to the development of nomlabofusp. 18 In partial consideration for the right and license granted under the agreement, the Company will pay IU a royalty of a low single digit percentage of net sales of licensed products depending on whether there is a valid patent covering such products. As additional consideration for these agreements, the Company is obligated to pay IU certain milestone payments of up to $ 2.0 million in the aggregate upon the achievement of certain developmental milestones, which commenced with the enrollment of the first patient in a Phase 1 clinical trial. The Company enrolled the first patient in its SAD trial on December 11, 2019 and paid IU less than $ 0.1 million. The Company will also pay IU sublicensing fees ranging from a high-single digit to a low double-digit percentage of sublicense consideration depending on the Company’s achievement of certain regulatory milestones as of the time of receipt of the sublicense consideration. The Company is also obligated to reimburse IU for patent-related expenses. In the event that the Company disputes the validity of any of the licensed patents, the royalty rate would be tripled during such dispute. The Company is also obligated to pay to IU a minimum annual royalty of less than $ 0.1 million per annum. In October 2022, the Company initiated dosing of a Phase 2 study. Pursuant to the terms of the IU License, the company recognized milestone expense of $ 0.1 million within research and development expenses. The agreement continues from its effective date through the last to date of expiration of the licensed patent, unless earlier terminated by either party in accordance with the terms of the agreement. We were previously a party to the License Agreement dated November 30, 2016, with Wake Forest University Health Sciences (“WFUHS”), which licensed certain patent rights regarding technology used by us with respect to the development of nomlabofusp in consideration for an obligation to pay WFUHS a royalty of a low single digit percentage of net sales of licensed products, certain milestones, and certain sublicensing revenue. The WFUHS license expired in December 2025 with the last to expire licensed patent. Leases Bala Cynwyd Office Space On August 8, 2019, the Company entered into an operating lease for 4,642 square footage of office space in Bala Cynwyd, Pennsylvania, effective as of December 15, 2019, for a period of three years and six months with an option to extend the lease for three additional years. Due to required tenant improvements to be completed by the landlord, the Company did not take immediate possession of the leased property and the lease term commenced on February 15, 2020 . On March 9, 2023, the Company executed a lease extension agreement on its original 4,642 square footage of office space in Bala Cynwyd, Pennsylvania (which was set to expire in August 2023 ) and agreed to lease an additional 3,462 square feet of office space from the same landlord. The lease extension on the original 4,642 square footage commenced on September 1, 2023 and the Company recorded a right of use asset and lease liability of $ 0.5 million as of that date. The new lease on 3,462 additional square footage commenced on October 1, 2023 and the Company recorded a right of use asset and lease liability of $ 0.3 million as of that date. On November 24, 2025, the Company executed the second amendment to the lease on the current 8,104 square footage of office space in Bala Cynwyd, Pennsylvania which was set to expire in August 2026 that extended the lease term on the then current 8,104 square footage through January 31, 2030 and agreed to lease an additional 7,107 square feet of space from the same landlord. As of March 31, 2026, the property had not been made available for use due to the tenant improvement work being performed by the landlord. Consequently, the Company determined that the lease has not yet commenced for accounting purposes. No right of use asset or lease liability will be recorded until the lease commencement date which shall occur in Q2 2026. The right of use assets and lease liabilities with both these leases are reflected in the financial statements for three months ended March 31, 2026 as are the right of use asset and lease liability of the Company's Boston office space discussed below. 19 Boston Office Lease In connection with the Company's 2020 merger with Zafgen, on May 28, 2020, the Company acquired a non-cancellable operating lease for approximately 17,705 square feet of office space (the “Premises”). The lease expires on October 30, 2029 . As part of the agreement, the Company was initially required to maintain a letter of credit, of $ 1.3 million. In October of 2024, upon the agreement with the landlord that we had achieved certain clinical development milestones required in the lease, this letter of credit was reduced to $ 0.6 million. During both periods presented, this cash deposit is classified as restricted cash within the condensed consolidated financial statements. In addition to the base rent, the Company is also responsible for its share of operating expenses, electricity and real estate taxes, which costs are not included in the determination of the leases’ right-of-use assets or lease liabilities. The right-of-use asset is being amortized to other income/(expense) over the remaining lease term as a result of the sublease described below. On October 27, 2020, the Company entered into a sublease agreement (the “Sublease”) with Massachusetts Municipal Association, Inc. (the “Subtenant”), whereby the Company sublet the entire Premises to the Subtenant. The initial term of the Sublease commenced on December 4, 2020 and continues until October 30, 2029 . In connection with the Sublease, the Company evaluated the need for impairment under ASC 360 (“Impairment Testing: Long-Lived Assets Classified as Held and Used”) and determined there was no impairment. The Sublease provided for an initial annual base rent of $ 0.8 million, which increases annually up to a maximum annual base rent of $ 1.0 million. The Subtenant also is responsible for paying to the Company future increases in operating costs (commencing on January 1, 2022), future increases in annual tax costs (commencing July 1, 2021) and all utility costs (commencing March 1, 2021) attributable to the Premises during the term of the Sublease. As part of the Sublease, the subtenant deposited a letter of credit in the amount of $ 0.8 million to assure their performance under the sublease. If there are no uncured events of default under the sublease, the amount of this security deposit decreases over time to $ 0.4 million on the sixth anniversary of the Sublease. The Company records sublease income on this sublease on a straight-line basis as a component of other income/(expense). Lab Space On October 16, 2023, the Company entered into an operating lease for lab space in King of Prussia, Pennsylvania for a period of four years . Due to required tenant improvements to be completed by the landlord, the Company did not take immediate possession of the leased property. The actual lease term commenced on May 10, 2024 . Upon commencement of the lease term, the Company recorded a right of use asset and lease liability of $ 0.5 million which are reflected in these condensed consolidated financial statements. Lease Expense Expense arising from operating leases was $ 0.1 million during the three months ended March 31, 2026 and 2025, respectively. For operating leases, the weighted-average remaining lease term for leases as of March 31, 2026 and December 31, 2025 was 3.4 and 3.6 years, respectively. For operating leases, the weighted average discount rate for leases as of March 31, 2026 and December 31, 2025 was 11.0 %. The Company has not entered into any financing leases. Maturities of lease liabilities due under these lease agreements as of March 31, 2026 are as follows: Operating (in thousands) Leases Nine months ending December 31, 2026 $ 1,086 Year ended December 31, 2027 1,273 Year ended December 31, 2028 1,188 Year ended December 31, 2029 959 Thereafter — Total lease payments 4,506 Less: imputed interest ( 727 ) Present value of lease liabilities $ 3,779 Legal Proceedings 20 The Company is not currently a party to any litigation, nor is management aware of any pending or threatened litigation against the Company, that it believes would materially affect the Company's business, operating results, financial condition or cash flows. 9. Net Loss Per Share Giving Effect to Conversion of Common Stock to Series A Preferred Stock The following table sets forth the computation of basic and diluted net loss per share for the three months ended March 31, 2026 (in thousands, except share and per share amounts). For purposes of earnings per share, the Series A Preferred Stock have the same characteristics as common stock and have no liquidation or other material preferential rights over common stock and accordingly, have been considered as a second class of common stock in the computation of net loss per share regardless of their legal form. Losses are allocated between the common shares and the Series A Preferred Stock on a pro rata basis as they share equally in losses and residual net assets on an as-converted basis. Net Loss $ ( 29,613 ) Allocation of net loss to common ( 28,225 ) Allocation of net loss to Series A Preferred ( 1,388 ) Weighted average shares of common stock outstanding, basic and diluted 89,814,820 Weighted average shares of Series A Preferred outstanding, basic and diluted 441,667 Net loss per share of common stock, basic and diluted $ ( 0.31 ) Net loss per share of Series A Preferred, basic and diluted $ ( 3.14 ) The weighted average number of Series A Preferred Stock reflects only the period of time that this class of securities has been newly designated and issued. The Company excluded the options below to purchase common stock, unreleased restricted stock units, and performance-based restricted stock units outstanding as of March 31, 2026 and 2025, respectively, from the computation of diluted net loss per share for the three months ended March 31, 2026 and 2025, respectively, because they had an anti-dilutive impact due to the net loss incurred for the periods. Additionally, the as-converted preferred shares have been excluded from diluted earnings per share as the effect would not be dilutive. As of March 31, 2026 2025 Options to purchase common stock 10,577,601 8,541,489 Unvested restricted common stock 1,229,259 1,023,061 Unvested performance-based restricted common stock 200,000 200,000 12,006,860 9,764,550 21