Maze Therapeutics, Inc. 10-Q

Item 2. Management’s Discussion and Analysis of Financia l Condition and Results of Operations The following discussion should be read in conjunction with the unaudited condensed financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q; and the sections entitled “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in our Annual Report on Form 10-K for the year ended December 31, 2024 as filed with the SEC on March 31, 2025, or 2024 Form 10-K. Overview We are a clinical-stage biopharmaceutical company harnessing the power of human genetics to develop novel, small molecule precision medicines for patients living with kidney and metabolic diseases, including obesity. We are advancing a pipeline using our Compass platform, which allows us to identify and characterize genetic variants in disease and then link those variants to the biological pathways that drive disease in specific patient groups through a process we refer to as variant functionalization. Our Compass platform has been purpose-built to inform all phases of our drug discovery and development process through clinical trial design. We are currently advancing two wholly-owned lead programs, MZE829 and MZE782, each of which represents a novel precision medicine-based approach. Our goal is to bring novel precision medicines to patients with kidney and metabolic diseases, which is where we believe we can maximize our impact on human health. Since our inception, we have focused substantially all of our efforts and financial resources on research and development activities for our programs and on establishing arrangements and collaborations with third parties for the development of our therapeutic candidates. To date, we have not generated any revenue from product sales and we do not expect to generate any revenue from commercial sales for the foreseeable future. Except for the one-time, nonrefundable upfront payments we received pursuant to the license agreements we entered into with several biotechnology companies in 2024, including the exclusive license agreement with Shionogi & Company, Ltd., or Shionogi, we expect to continue incurring significant operating losses for the foreseeable future due to the cost of research and development, clinical trials, preclinical studies and the regulatory approval process for our therapeutic candidates. We have incurred significant losses and negative cash flows from operations since our inception, except for the net income and cash provided by operations due to license revenue recognized during the year ended December 31, 2024, and we expect to incur significant and increasing losses as a result of our continued research and development activities. During the three and nine months ended September 30, 2025, we incurred a net loss of $30.1 million and $96.6 million, respectively. During the three and nine months ended September 30, 2024, we incurred a net loss of $24.8 million and net income of $81.8 million, respectively. As of September 30, 2025, we had an accumulated deficit of $455.0 million and do not expect positive cash flows from operations in the foreseeable future. We expect to continue incurring significant expenses and increasing losses for the foreseeable future. Our net losses may fluctuate significantly from period to period, depending on the timing of and expenditures on our planned research and development activities, as well as upon revenue from our license agreements. We expect our research and development expenses to significantly increase in connection with the conduct of planned clinical trials for our lead programs, MZE829 and MZE782, further development of our Compass platform, planned preclinical studies, and potential Investigational New Drug Applications, or INDs, and clinical trials for future therapeutic candidates. We will also incur substantial additional expenses as we seek to expand our intellectual property portfolio, including through potential in-licensing opportunities, and hire additional personnel as we scale up our operations. In addition, we expect to incur additional costs associated with operating as a public company. As of September 30, 2025, we had cash, cash equivalents and marketable securities of $383.9 million. Since our inception, we have financed our operations primarily through issuances of our equity, license agreements with biotechnology companies and issuances of convertible promissory notes. In February 2025, we completed our initial public offering, pursuant to which we issued and sold an aggregate of 8,750,000 shares of our common stock at an initial public offering price of $16.00 per share, resulting in gross proceeds of $140.0 million. In September 2025, we entered into a securities purchase agreement, or the Private Placement, with certain investors, pursuant to which we issued and sold an aggregate of 4,000,002 shares of our common stock at a purchase price of $16.25 per share and pre-funded warrants, or the Pre-Funded Warrants, to purchase up to an aggregate of 5,231,090 shares of our common stock at a purchase price of $16.249 per Pre-Funded Warrant, resulting in gross proceeds of $150.0 million. The Pre-Funded Warrants have an exercise price of $0.001 per share, are immediately exercisable and do not expire. 19 We will require substantial additional capital to develop our therapeutic candidates and fund operations for the foreseeable future. Until such time as we can generate sufficient revenue from product sales, if ever, we expect to finance our operations through a combination of public or private equity offerings, debt financings, collaborations and licensing arrangements. We are party to a loan and security agreement that provides us with a line of credit of up to $50.0 million. To date, we have not drawn down any funds from this debt facility and do not currently intend to do so. Adequate additional financing may not be available to us on favorable terms, or at all. In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. If we are unable to raise capital when needed or on favorable terms, we could be forced to delay, reduce or eliminate our clinical and preclinical development, research and development programs, our commercialization plans or other operations. The amount and timing of our future funding requirements will depend on many factors including the pace and results of our development efforts. We cannot assure you that we will ever be profitable or generate positive cash flows from operating activities. We selectively pursue strategic collaborations related to the development of certain targets, therapeutic programs, or disease areas where we believe third-party expertise or resources could be beneficial. In 2020, we formed a spin-out company, Broadwing Bio LLC, or Broadwing, with Alloy Therapeutics, Inc., or Alloy, to develop therapeutic antibody therapies for ANGPTL7 and another undisclosed target in ophthalmic diseases, informed by our Compass platform. As of September 30, 2025, we owned approximately 48% of the outstanding equity of Broadwing, and we expect our ownership to be significantly diluted upon the conversion of outstanding convertible notes issued by Broadwing. We retain certain opt-in rights to jointly develop and commercialize certain therapeutic candidates developed through Broadwing with Alloy. We are not involved in the development of Broadwing’s therapeutic candidate. MZE782 Phase 1 Trial Results On September 11, 2025, we announced positive clinical results from the Phase 1 healthy volunteer study of MZE782. The Phase 1 trial of MZE782 was a randomized, double-blind, placebo-controlled study evaluating single ascending doses and multiple ascending doses of orally administered MZE782 in 112 healthy adult volunteers. The single ascending doses, or SAD, ranged from 30 mg to 960 mg and the multiple ascending doses, or MAD, with dosing once or twice daily for seven days, ranged from 120 mg to 240 mg twice daily and 120 mg to 720 mg once daily. The primary objective was to evaluate the safety and tolerability of single and multiple ascending oral doses of MZE782 in healthy volunteers. Secondary and exploratory endpoints included pharmacokinetics, food effect, pharmacodynamic measures of target engagement, specifically urinary excretion of phenylalanine, or Phe, and glutamine, or Gln, as predictive biomarkers of SLC6A19 inhibition and disease control, and estimated glomerular filtration rate, or eGFR. MZE782 was well tolerated across all doses in all cohorts. There were no serious adverse events, no severe adverse events and no treatment-related adverse events, or TRAEs, leading to discontinuation. In the single ascending dose portion of the study (n=56), there were a total of three TRAEs reported that were all mild in severity and not seen at the higher doses. Headache was reported in two patients (4%) and diarrhea was reported in one patient (2%). There were no TRAEs reported in the MAD portion of the study. No clinically relevant changes in vital signs, laboratory tests or electrocardiograms were observed. MZE782 demonstrated a favorable plasma pharmacokinetics profile after single and multiple oral doses. Oral administration was associated with consistent absorption, with a time to maximum concentration (tmax) of six hours and a half-life (t1/2) of 11 hours. Exposure increased proportionally with dose, and steady-state was achieved by Day 3. This is supportive of a once- or twice-daily dosing regimen to be evaluated in Phase 2. MZE782 produced dose-dependent increases in 24-hour urinary excretion of the neutral amino acids Phe and Gln across both SAD and MAD cohorts, confirming target engagement and SLC6A19 inhibition. All participants in the MAD cohorts of the Phase 1 study were assessed for changes in eGFR. MZE782 demonstrated a dose-dependent initial eGFR dip over seven days of dosing that was similar in magnitude to what has been observed in patients initiating SGLT2 and RAAS inhibitors. We plan to initiate two Phase 2 proof-of-concept trials of MZE782, evaluating plasma Phe reduction in phenylketonuria, or PKU, and proteinuria reduction in chronic kidney disease, or CKD, in 2026. 20 Exclusive license agreement Exclusive license agreement with Shionogi In March 2024, we entered into an exclusive license agreement, or the License Agreement, with Shionogi, pursuant to which we granted Shionogi an exclusive, worldwide, sublicensable license to research, develop, manufacture and commercialize MZE001 and certain other small molecule compounds modulating glycogen synthase 1, or the Licensed Products. As consideration for the licensed rights and the transfer of know-how and materials, we received an upfront payment of $150.0 million, which is the only payment we have received under the License Agreement to date. The License Agreement also requires that Shionogi pay us up to $275.0 million in the aggregate in milestone payments upon the completion of certain clinical and regulatory milestones and up to $330.0 million in the aggregate in milestone payments if certain sales milestones are achieved. The License Agreement also requires that Shionogi pay us tiered royalties ranging from percentages in the low double-digits to twenty on net sales of Licensed Products, subject to certain deductions. The License Agreement will expire on a Licensed-Product by Licensed-Product and country-by-country basis upon the expiration of the royalty term for such Licensed Product, which will be the latest of the date when there are no remaining valid claims covering the applicable Licensed Product, the expiration of regulatory exclusivity for the applicable Licensed Product, or 11 years after the first commercial sale of the applicable Licensed Product, subject to earlier termination by the parties. As of September 30, 2025, we estimate that the last patent right for the only currently issued patent licensed under the License Agreement will expire in 2042, without giving effect to any potential patent term extensions, patent term adjustments , or future patents that may or may not issue with respect to the Licensed Products. Upon expiration of the License Agreement, the licenses granted to Shionogi will become fully paid-up, perpetual, irrevocable and royalty-free. Shionogi may terminate the License Agreement for convenience following a notice period and either party may terminate the License Agreement for bankruptcy or an uncured material breach. Upon termination of the License Agreement by Shionogi for convenience or by us for Shionogi’s bankruptcy or uncured material breach, Shionogi will grant us a non-exclusive, worldwide license under certain patent rights and know-how controlled by Shionogi as of the effective date of termination, solely as necessary to research, develop, manufacture and commercialize the Licensed Products in any field, and Shionogi will assign to us all regulatory materials and regulatory approvals relating to the Licensed Products. In consideration for these reversion rights, we would be required to pay to Shionogi reversion royalties on any sales of the Licensed Products determined based on the stage of clinical development of the applicable Licensed Product at the time of termination, ranging from percentages in the low-to-mid single digits if termination occurs on or after the achievement of certain Phase 2 clinical trial milestones and high single digit to mid-teens if termination occurs on or after the achievement of certain Phase 3 clinical milestones. Our obligation to pay these reversion royalties would expire on a Licensed-Product by Licensed-Product and country-by-country basis upon the latest of the date when there are no remaining valid claims covering the applicable Licensed Product, the expiration of regulatory exclusivity for the applicable Licensed Product, or ten years after the first commercial sale of the applicable Licensed Product. Components of results of operations License revenue We recognize revenue from the various license agreements we have entered into as the identified performance obligations under these arrangements are satisfied. We are also eligible to receive future non-refundable, non-creditable milestone payments upon the achievement of certain development, regulatory, and commercial milestones. Additionally, we are also eligible to receive certain royalties on net sales of products developed under the license agreements. Operating expenses Our operating expenses since inception have consisted solely of research and development expenses and general and administrative expenses. Research and development expenses Our research and development expenses consist primarily of external and internal expenses incurred in connection with our research activities and preclinical and clinical development programs. These expenses include, but are not limited to: • salaries, benefits and other employee-related costs, including stock-based compensation expense, for personnel engaged in research and development functions; • fees paid to vendors that conduct certain research and development activities on our behalf; • fees paid to contract manufacturing organizations, or CMOs, in connection with the production of research products and clinical trial materials; 21 • fees paid to clinical research organizations, or CROs, in connection with clinical trials as well as preclinical and toxicology studies; • other expenses associated with laboratory supplies and other materials; • professional service fees for consulting and related services; and • facility costs, depreciation, and other expenses, which include direct and allocated expenses for rent and maintenance of facilities and other supplies. We recognize research and development expenses as they are incurred. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are capitalized and expensed as the goods are delivered or the related services are performed. We have not historically disclosed our direct costs between our clinical programs and our preclinical programs. Additionally, our internal costs, employees and infrastructure are not directly tied to any one program and are deployed across multiple programs. As such, we do not track indirect costs on a specific program basis. At this time, we cannot reasonably estimate or know the nature, timing, and estimated costs of the efforts that will be necessary to complete the development of, and obtain regulatory approval for, MZE829, MZE782 and any of our other potential therapeutic candidates. Our research and development expenses may vary significantly based on a variety of factors, such as: • the timing and progress of clinical development activities for our therapeutic candidates; • the timing and progress of preclinical development activities; • the number and scope of preclinical and clinical programs we decide to pursue; • our ability to hire clinical, regulatory, manufacturing, quality assurance and scientific personnel; • potential additional trials requested by regulatory agencies; • the costs and fees associated with the discovery, acquisition or in-license of our products or technologies, including to maintain and expand our Compass platform; • our ability to establish clinical manufacturing capabilities or secure adequate supply of product from third-party manufacturers; • the extent to which we establish additional strategic collaborations or other arrangements; and • the impact of any business interruptions to our operations or to those of the third parties with whom we work. A change in the outcome of any of these and other variables with respect to the development of any of our therapeutic candidates could significantly change the costs and timing associated with the development of such therapeutic candidate. We expect that our research and development expenses will continue to increase substantially for the foreseeable future as we continue to identify and develop potential additional therapeutic candidates and as our existing therapeutic candidates, including MZE829 and MZE782, move into later stages of clinical development, which typically have higher development costs than those in earlier stages of clinical development or preclinical development due to the increased size and duration of later-stage clinical trials. The process of conducting the necessary preclinical and clinical research and development to obtain regulatory approval is costly and time-consuming and the successful development of our therapeutic candidates is highly uncertain. The actual probability of success for our therapeutic candidates may be affected by a variety of factors. We may never succeed in achieving regulatory approval for any of our therapeutic candidates. Further, a number of factors, including those outside of our control, could adversely impact the timing and duration of our therapeutic candidates’ development, which could increase our research and development expenses. General and administrative expenses General and administrative expenses consist primarily of personnel-related costs, including salaries, bonuses, benefits, and stock-based compensation expense, for personnel in executive, finance, accounting, corporate development, and other administrative functions. General and administrative expenses also include legal fees, professional fees paid for accounting, auditing, consulting, tax, and investor relations services, insurance costs, and facility costs not otherwise included in research and development expenses, and public company expenses such as costs associated with compliance with the rules and regulations of the SEC and Nasdaq. 22 We expect that our general and administrative expenses will continue to increase significantly in the foreseeable future as additional administrative personnel and services are required to manage these functions of a public company and as our pipeline of therapeutic candidates expands. Interest and other income, net Interest and other income, net consists of interest income earned on our cash, cash equivalents and marketable securities, interest expense, foreign currency re-measurement and transaction gains and losses. We expect interest income to increase as a result of the receipt of net proceeds of approximately $127.8 million from our initial public offering completed in February 2025 and net proceeds of approximately $141.3 million from our Private Placement completed in September 2025. However, interest income may vary each reporting period depending on our average cash deposits, money market fund balances and other investment balances during the period and prevailing market interest rates. We expect foreign currency gains and losses to vary each reporting period depending on the fluctuations in foreign currency exchange rates. Change in fair value of convertible promissory notes From December 2023 through April 2024, we issued a total of $40.7 million aggregate principal amount of convertible promissory notes, which contained automatic conversion features triggered upon a qualified preferred stock financing or a qualified public offering. We elected to apply the fair value option, as per Accounting Standards Codification, or ASC, Section 825-10, to the outstanding convertible promissory notes issued. As such, the convertible promissory notes were recognized at fair value with changes in fair value recognized in the condensed statements of operations and comprehensive (loss) income. We recorded a net loss of $2.6 million and $7.2 million in the condensed statements of operations and comprehensive (loss) income for the three and nine months ended September 30, 2024, respectively, reflecting the change in the fair value of the convertible promissory notes. The impact of interest expense on the convertible promissory notes is included within the changes in fair value. In connection with the private placement of our Series D convertible preferred stock, or Series D Preferred Stock, in November 2024, which was a qualified preferred stock financing pursuant to the terms of the convertible promissory notes, the outstanding convertible promissory notes automatically converted into 39,395,572 shares of Series D-1 convertible preferred stock, or Series D-1 Preferred Stock, at a conversion price of $1.10336 per share. No convertible promissory notes were outstanding as of December 31, 2024. Accordingly, no change in fair value of convertible promissory notes was recorded in the condensed statements of operations and comprehensive (loss) income for the three and nine months ended September 30, 2025. Income tax benefit (expense) We are subject to corporate United States federal and state income taxation. We account for income taxes using the asset and liability method and recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns subject to a determinable valuation allowance. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. In evaluating the ability to recover our deferred income tax assets, we consider all available positive and negative evidence, including our operating results, ongoing tax planning and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. In the event we determine that we would be able to realize our deferred income tax assets in the future in excess of our net recorded amount, we would make an adjustment to the valuation allowance that would reduce the provision for income taxes. Conversely, in the event that all or part of the net deferred tax assets are determined not to be realizable in the future, an adjustment to the valuation allowance would be charged to earnings in the period when such determination is made. We recognize uncertain income tax positions at the largest amount that is more likely than not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Changes in recognition or measurement are reflected in the period in which judgment occurs. Our policy is to recognize interest and penalties related to the underpayment of income taxes as a component of the provision for income tax. 23 Results of operations Comparisons of the three and nine months ended September 30, 2025 and 2024 Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 Change 2025 2024 Change (in thousands) (in thousands) License revenue $ — $ 2,500 $ (2,500 ) $ — $ 167,500 $ (167,500 ) Operating expenses: Research and development 25,190 19,857 5,333 80,878 61,280 19,598 General and administrative 7,775 6,872 903 23,962 18,908 5,054 Total operating expenses 32,965 26,729 6,236 104,840 80,188 24,652 (Loss) income from operations (32,965 ) (24,229 ) (8,736 ) (104,840 ) 87,312 (192,152 ) Interest and other income, net 2,878 1,846 1,032 8,288 3,138 5,150 Change in fair value of convertible promissory notes — (2,648 ) 2,648 — (7,193 ) 7,193 (Loss) income before income tax benefit (expense) $ (30,087 ) $ (25,031 ) $ (5,056 ) $ (96,552 ) $ 83,257 $ (179,809 ) Income tax benefit (expense) — 279 (279 ) — (1,447 ) 1,447 Net (loss) income $ (30,087 ) $ (24,752 ) $ (5,335 ) $ (96,552 ) $ 81,810 $ (178,362 ) License revenue We recognized no license revenue for the three and nine months ended September 30, 2025. We recognized $2.5 million and $167.5 million of license revenue for the three and nine months ended September 30, 2024, respectively. License revenue recognized in 2024 primarily related to the License Agreement with Shionogi, wherein we received an upfront payment of $150.0 million in exchange for the transfer of the license, know-how, and materials related to the research, development, manufacture and commercialization of MZE001 and certain other small molecule compounds modulating glycogen synthase 1. License revenue recognized in 2024 also included amounts related to the exclusive license agreement with Trace Neuroscience, Inc., or Trace, wherein we received an upfront payment of $15.0 million in exchange for the transfer of the license, know-how, and materials related to the research, development, manufacture and commercialization of a discovery research program targeting UNC13A for the treatment of amyotrophic lateral sclerosis, or ALS, and $2.5 million related to the exclusive license agreement with Neurocrine Biosciences, Inc., or Neurocrine, for the transfer of the license, know-how and materials related to a discovery research program targeting ATXN2. Research and development expenses Research and development expenses were $25.2 million and $19.9 million for the three months ended September 30, 2025 and 2024, respectively. The increase of $5.3 million between the comparative three month periods was primarily due to an increase of $3.1 million in personnel-related costs due to an increase in headcount, an increase of $1.9 million in clinical trial expenses based on the progression of our Phase 2 clinical trial for MZE829 that was initiated in November 2024. The increase also reflects higher costs for outside research and development services of $0.3 million to support our research programs. Research and development expenses were $80.9 million and $61.3 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $19.6 million between the comparative nine month periods was primarily due to an increase of $7.8 million in clinical trial expenses and an increase of $1.7 million in manufacturing expenses based on the progression of our Phase 2 clinical trial for MZE829 and our Phase 1 clinical trial for MZE782. The increase also reflects higher personnel-related costs of $7.3 million due to an increase in headcount and higher costs for outside research and development services of $2.1 million to support our research programs. 24 Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 Change 2025 2024 Change (in thousands) (in thousands) Personnel-related costs $ 11,497 $ 8,365 $ 3,132 $ 32,450 $ 25,157 $ 7,293 Clinical trial expenses 3,925 1,997 1,928 14,675 6,921 7,754 Outside research and development services 3,760 3,493 267 13,084 10,954 2,130 Manufacturing expenses 879 692 187 4,628 2,926 1,702 Facilities, depreciation and other expenses 5,129 5,310 (181 ) 16,041 15,322 719 Total research and development expenses $ 25,190 $ 19,857 $ 5,333 $ 80,878 $ 61,280 $ 19,598 General and administrative expenses General and administrative expenses were $7.8 million and $6.9 million for the three months ended September 30, 2025 and 2024, respectively. The increase of $0.9 million between the comparative three month periods was primarily due to an increase of $0.7 million in personnel-related costs due to an increase in headcount and higher facilities and other costs of $0.3 million. General and administrative expenses were $24.0 million and $18.9 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $5.1 million between the comparative nine month periods was primarily due to an increase of $3.1 million in personnel-related costs due to an increase in headcount, higher facilities and other costs of $1.0 million, and higher costs for professional service fees of $0.7 million. Interest and other income, net Interest and other income, net was $2.9 million and $8.3 million for the three and nine months ended September 30, 2025, respectively. Interest and other income, net was $1.8 million and $3.1 million for the three and nine months ended September 30, 2024, respectively. The increase of $1.0 million and $5.2 million between the comparative three and nine months periods, respectively, primarily reflects an increase in interest income as a result of higher cash, cash equivalent, and marketable securities balances held during the three and nine months ended September 30, 2025 from the proceeds received from the private placement of our Series D Preferred Stock completed in November 2024, the initial public offering completed in February 2025 and the Private Placement completed in September 2025. Change in fair value of convertible promissory notes The convertible promissory notes issued from December 2023 through April 2024 contained automatic conversion features that triggered upon a qualified preferred stock financing or a qualified public offering. We elected to apply the fair value option to the convertible promissory notes issued. As such, the convertible promissory notes were recorded at fair value at each reporting period with changes in fair value recognized in the condensed statements of operations and comprehensive (loss) income. The change in fair value of the convertible promissory notes resulted in a net loss of $2.6 million and $7.2 million for the three and nine months ended September 30, 2024, respectively. The convertible promissory notes converted into Series D-1 Preferred Stock in November 2024 in connection with the private placement of our Series D Preferred Stock, which was a qualified preferred stock financing pursuant to the terms of the convertible promissory notes. No convertible promissory notes were outstanding as of December 31, 2024. Accordingly, no change in fair value of convertible promissory notes was recorded in the condensed statements of operations and comprehensive (loss) income for the three and nine months ended September 30, 2025. Income tax benefit (expense) Income tax benefit (expense) was zero for the three and nine months ended September 30, 2025 compared to an income tax benefit of $0.3 million and an income tax expense of $1.4 million for the three and nine months ended September 30, 2024, respectively. The amounts recognized in the comparative periods in 2024 were primarily due to the net income generated as a result of the recognition of license revenue under our license agreement with Shionogi, resulting in taxable income to the Company, as compared to the net loss incurred during the three and nine months ended September 30, 2025. 25 Liquidity and capital resources Liquidity Since our inception, we have not generated any revenue from product sales and we do not expect to generate any revenue from commercial sales for the foreseeable future, if at all. We have incurred significant operating losses and negative cash flows from operations. We anticipate that we will continue to incur net losses for the foreseeable future. To date, we have financed our operations primarily through private placements of redeemable convertible preferred stock, one-time, nonrefundable upfront payments made to us in connection with our entry into license agreements, private placements of convertible promissory notes, and most recently, through an initial public offering of our common stock. As of September 30, 2025, we had cash, cash equivalents and marketable securities of $383.9 million and an accumulated deficit of $455.0 million. In February 2025, we completed our initial public offering, pursuant to which we issued and sold an aggregate of 8,750,000 shares of our common stock at an initial public offering price of $16.00 per share, resulting in net proceeds of approximately $127.8 million, after deducting underwriting discounts, commissions and other offering expenses paid by us in 2025. In September 2025, we completed the Private Placement, pursuant to which we issued and sold an aggregate of 4,000,002 shares of our common stock at a purchase price of $16.25 per share and Pre-Funded Warrants to purchase up to an aggregate of 5,231,090 shares of our common stock at a purchase price of $16.249 per Pre-Funded Warrant, resulting in net proceeds of approximately $141.3 million, after deducting placement fees and other offering expenses payable by the Company of approximately $8.7 million. The Pre-Funded Warrants have an exercise price of $0.001 per share, are immediately exercisable and do not expire. As of September 30, 2025, none of the Pre-Funded Warrants have been exercised. Based on our current operating plan, we believe that our existing cash, cash equivalents and marketable securities will be sufficient to fund our operations for at least one year from the date of this Quarterly Report on Form 10-Q. We have based this estimate on our current assumptions, which may prove to be wrong, and we may exhaust our available capital resources sooner than we expect. Funding requirements We do not expect to generate any meaningful future revenue unless and until we obtain regulatory approval and commercialize any of our current or future therapeutic candidates, including MZE829 and MZE782, or receive additional potential revenue from the achievement of milestones and royalties under our existing license agreements or potential additional partnerships, and we do not know when, or if at all, that will occur. We will continue to require additional capital to develop our therapeutic candidates and fund operations for the foreseeable future. Our primary uses of cash are to fund our operations, which consist primarily of research and development expenses related to our programs, and to a lesser extent, general and administrative expenses. We expect our expenses to continue to increase in connection with our ongoing activities as we continue to develop MZE829, MZE782 and our other discovery and preclinical programs, seek to broaden the pipeline of our product candidates and further develop our Compass platform. In addition, we expect to incur additional costs associated with operating as a public company. We may seek to raise capital through equity or debt financings, license and collaboration agreements or other arrangements, or through other sources of financing. Adequate additional funding may not be available to us on acceptable terms or at all. Our failure to raise capital as and when needed could have a negative impact on our financial condition and our ability to pursue our business strategies. We anticipate that we will need to raise substantial additional capital, the requirements of which will depend on many factors, including: • the costs associated with the type, scope, progress and results of research and discovery, preclinical development, laboratory testing and clinical trials for our current or future therapeutic candidates, including MZE829 and MZE782; • the extent to which we develop, in-license or acquire other pipeline therapeutic candidates or technologies; • the number and development requirements of other therapeutic candidates that we may pursue, and other indications for our current therapeutic candidates that we may pursue; • the costs related to entering into partnerships or other arrangements with third parties; • the costs, timing and outcome of obtaining regulatory approvals of our current or future therapeutic candidates we may pursue; 26 • the costs and fees associated with the discovery, acquisition or in-license of our products or technologies, including to maintain and expand our Compass platform; • the scope and costs of making arrangements with third-party manufacturers for preclinical, clinical and commercial supplies of our current or future therapeutic candidates; • the scope and costs involved in growing our organization to the size needed to allow for the research, development and potential commercialization of our current or future therapeutic candidates; • the cost associated with commercializing any approved therapeutic candidates, including establishing sales, marketing and distribution capabilities; • the cost associated with completing any post-marketing studies or trials required by the U.S. Food and Drug Administration, or FDA, or other regulatory authorities; • the revenue, if any, received from commercial sales of our current or future therapeutic candidates, if any are approved; • the costs associated with addressing any potential interruptions or delays resulting from factors related to overall global affairs, such as conflicts overseas; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining, defending and enforcing our intellectual property and proprietary rights and defending intellectual property-related claims that we may become subject to, including any litigation costs and the outcome of such litigation; • the costs associated with potential product liability claims, including the costs associated with obtaining insurance against such claims and with defending against such claims; and • our ability to establish and maintain collaboration arrangements on favorable terms, if at all and the timing and amount of any milestone, royalty or other payments we are required to make or are eligible to receive under such collaborations, if any. If we raise additional funds by issuing equity securities, our stockholders will experience dilution. If we raise additional capital through debt financing, we may be subject to covenants that restrict our operations including limitations on our ability to incur liens or additional debt, pay dividends, repurchase our common stock, make certain investments, and engage in certain merger, consolidation or asset sale transactions. Any debt financing or additional equity that we raise may contain terms that are not favorable to us or our stockholders. If we raise additional funds through collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our proprietary technology, future revenue streams, research programs or therapeutic candidates, including granting licenses to our proprietary technologies, on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or collaborations, strategic alliances or licensing arrangements with third parties when needed, we may be required to delay, limit, reduce and/or terminate our product development programs or any future commercialization efforts or grant rights to develop and market therapeutic candidates that we would otherwise prefer to develop and market ourselves. Contractual obligations and commitments We have an operating lease for a facility in South San Francisco, California with office and laboratory space, which serves as our corporate headquarters. The lease terminates in November 2030 and provides for one option to extend the lease term for an additional period of eight years. We have entered into consortium agreements with the University of Helsinki and Queen Mary University to access genomic information from patient samples and genetic and paired clinical data. As of September 30, 2025, we are obligated to pay $4.6 million under these agreements through the year ended December 31, 2027. We enter into contracts in the normal course of business with third-party contract organizations for preclinical trials, non-clinical trials and testing, and other services and products for operating purposes. These contracts generally provide for termination following a certain period after notice. 27 Cash flows Comparisons of the nine months ended September 30, 2025 and 2024 The following table sets forth the primary sources and uses of cash, cash equivalents, and restricted cash for the periods presented below: Nine Months Ended September 30, 2025 2024 Change (in thousands) Net cash (used in) provided by operating activities $ (84,210 ) $ 98,406 $ (182,616 ) Net cash used in investing activities (67,575 ) (542 ) (67,033 ) Net cash provided by financing activities 271,747 22,585 249,162 Net increase in cash, cash equivalents and restricted cash $ 119,962 $ 120,449 $ (487 ) Net cash (used in) provided by operating activities Net cash used in operating activities was $84.2 million for the nine months ended September 30, 2025 and net cash provided by operating activities was $98.4 million for the nine months ended September 30, 2024. The net cash used in operating activities for the nine months ended September 30, 2025 was primarily due to our net loss of $96.6 million combined with a net change in our operating assets and liabilities of $2.0 million, offset by $14.3 million in non-cash charges such as depreciation, stock-based compensation, lease expense and accretion of discounts on marketable securities. The net cash provided by operating activities for the nine months ended September 30, 2024 was primarily due to our net income of $81.8 million, combined with $19.2 million in non-cash charges such as depreciation, stock-based compensation, lease expense and the change in fair value of the convertible promissory notes, offset by a net change in our operating assets and liabilities of $2.6 million. Net cash used in investing activities Net cash used in investing activities was $67.6 million for the nine months ended September 30, 2025, which related to purchases of marketable securities of $66.8 million and purchases of property and equipment of $0.8 million. Net cash used in investing activities was $0.5 million for the nine months ended September 30, 2024, which related to purchases of property and equipment. Net cash provided by financing activities For the nine months ended September 30, 2025, net cash provided by financing activities was $271.7 million, which consisted of net proceeds of $127.8 million from the issuance of common stock pursuant to our initial public offering, $141.7 million of net proceeds from the issuance of common stock and Pre-Funded Warrants in the Private Placement, $2.1 million from the exercise of stock option awards, net of repurchases and $0.6 million from the issuance of common stock under the 2025 Employee Stock Purchase Plan, partially offset by the payment of $0.5 million for the success fee under the loan and security agreement. For the nine months ended September 30, 2024, net cash provided by financing activities was $22.6 million, which consisted of net proceeds from the issuance of convertible promissory notes of $24.5 million and $0.7 million from the exercise of stock option awards, net of repurchases, partially offset by the payment of $2.6 million for deferred offering costs. Critical accounting policies, significant judgments and use of estimates Our significant accounting policies are described in detail in the notes to our condensed financial statements included elsewhere in this Quarterly Report on Form 10-Q. We described the accounting policies that we believe involve a significant level of estimation and uncertainty, which could have a material impact on our financial condition or results of operations and are therefore deemed critical accounting policies, in our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on March, 31, 2025. There have been no significant changes in our critical accounting policies and estimates during the nine months ended September 30, 2025. Our condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information. The preparation of these condensed financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the condensed financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. 28 Emerging growth company status We are an emerging growth company, or EGC. The Jumpstart Our Business Startups Act of 2012, or the JOBS Act permits companies with EGC status to take advantage of an extended transition period to comply with new or revised accounting standards, delaying the adoption of these accounting standards until they would apply to private companies. We have elected to use this extended transition period to enable us to comply with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an EGC or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with the new or revised accounting standards as of public company effective dates. In addition, we intend to rely on the other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an EGC, we intend to rely on such exemptions, we are not required to, among other things:(i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended; (ii) provide all of the compensation disclosure that may be required of non-EGCs under the Dodd-Frank Wall Street Reform and Consumer Protection Act; (iii) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis); and (iv) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the chief executive officer’s compensation to median employee compensation. We will remain an EGC under the JOBS Act until the earliest of (i) the last date of our fiscal year in which we have total annual gross revenue of at least $1.235 billion, (ii) the date we qualify as a “large accelerated filer,” as defined under Rule 12b-2 of the Exchange Act, (iii) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years, or (iv) the last day of our first fiscal year following the fifth anniversary of the closing of our initial public offering. Recent accounting pronouncements See Note 2 on Summary of significant accounting policies to our unaudited condensed financial statements included in Part 1 - Item 1, “Financial Statements,” of this Quarterly Report on Form 10-Q for a description of recent accounting pronouncements applicable to our business. 29