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Item 1. Business

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and its wholly owned subsidiaries.

We are a clinical stage biopharmaceutical company focused on the discovery, development and commercialization of innovative small molecules and antibody therapies based on the modulation of cellular protein levels as a novel treatment approach for cancer, inflammatory conditions and other challenging diseases.

Leveraging our extensive expertise in E3 ligases together with our proprietary DNA-encoded libraries, we have built DELigase, an integrated discovery platform to identify and advance novel drug candidates targeting E3 ligases, a broad class of enzymes that can modulate proteins within the cell.

Our drug discovery approach is to either harness or inhibit the natural function of E3 ligases within the ubiquitin-proteasome system to selectively decrease or increase cellular protein levels.

Our wholly owned, clinical stage pipeline includes targeted protein degraders of Bruton’s tyrosine kinase (BTK), a B-cell signaling protein, and inhibitors of Casitas B-lineage lymphoma proto-oncogene B (CBL-B), an E3 ligase that regulates activation of multiple immune cell types including T cells and NK cells.

Our partnered drug discovery pipeline consists of multiple programs under collaboration agreements with Gilead Sciences, Inc.

We are a clinical stage biopharmaceutical company focused on the discovery, development and commercialization of targeted protein degradation medicines, the next frontier in innovative drug design aimed at improving treatment options for patients with cancer and inflammatory diseases.

Powered by a fully artificial intelligence (AI)-integrated discovery engine capable of tackling any protein class, and coupled with leading ligase expertise, Nurix has built a significant advantage in translating the science of protein degradation into clinical advancements with the aim of establishing degrader-based treatments at the forefront of patient care.

Our wholly owned, clinical stage pipeline includes three investigational drug candidates designed with the goal to be first-in-class or best-in-class therapeutics:

NX-5948, a highly selective degrader of Bruton’s tyrosine kinase (BTK);

NX-2127, a dual degrader of BTK and transcription factors IKZF1(Ikaros) and IKZF3 (Aiolos);

and NX-1607, an inhibitor of Casitas B-lineage lymphoma proto-oncogene B (CBL-B), an E3 ligase that regulates activation of multiple immune cell types including T cells and NK cells.

We are also advancing multiple potentially first-in-class or best-in-class degraders and degrader antibody conjugates (DACs) in our preclinical pipeline.

Our partnered drug discovery pipeline consists of preclinical stage degraders of IRAK4, STAT6 and multiple currently undisclosed targets under collaboration agreements with Gilead Sciences, Inc.

(Gilead), Sanofi S.A.

(Sanofi) and Seagen Inc.

(now a part of Pfizer Inc.) (Pfizer), within which we retain certain options for co-development, co-commercialization and profit sharing in the United States for multiple drug candidates.

Our Clinical Development Pipeline

Our wholly owned pipeline of Targeted Protein Modulation (TPM) drug candidates comprises three clinical stage programs in our Targeted Protein Degradation (TPD) and Targeted Protein Elevation (TPE) portfolios.

These two portfolios demonstrate our ability to either decrease or increase protein levels in cells through the modulation of E3 ligases.

The following chart summarizes our clinical pipeline and ongoing clinical studies:

MOA , mechanism of action;

IND , investigational new drug;

DAC , degrader-antibody conjugates;

I&I , inflammation and immunology

Targeted Protein Degradation

Our portfolio of targeted protein degraders of BTK, a B‑cell signaling protein, comprises NX‑5948, an orally bioavailable BTK degrader for the treatment of relapsed or refractory B-cell malignancies and potentially autoimmune diseases, and NX‑2127, an orally bioavailable BTK degrader that also degrades cereblon neosubstrates IKZF1 (Ikaros) and IKZF3 (Aiolos) for the treatment of relapsed or refractory B‑cell malignancies.

We are currently treating patients in a Phase 1a/1b dose-escalation and cohort expansion study in patients with relapsed or refractory B-cell malignancies.

(Sanofi) and Pfizer Inc.

Within these collaborations, we retain certain options for co-development, co-commercialization and profit sharing in the United States for multiple drug candidates.

Both our wholly owned and partnered pipelines are driven by our DEL-AI discovery engine which employs advanced machine learning to enable all aspects of discovery, starting with DNA encoded library (DEL) hit-finding and degrader design, followed by automated chemistry synthesis and direct-to-biology screening and optimization, to rapidly generate degraders and DACs as new chemical entity drug candidates.

By leveraging hundreds of billions of DEL compound binding signatures derived from thousands of DEL affinity screens collected from a diverse set of highly validated protein targets, our DEL-AI engine can prospectively identify binders as starting points for drug discovery for virtually any pharmaceutically relevant target.

Our Clinical and Preclinical Development Pipeline

Our wholly owned pipeline of drug candidates comprises three clinical stage oncology programs and multiple preclinical stage Targeted Protein Degrader (TPD) and Degrader Antibody Conjugate (DAC) programs spanning the therapeutic areas of oncology, inflammation and immunology.

Our partnered pipeline further expands our reach into rheumatoid arthritis and Type 2 inflammation, as well as solid tumor oncology via multiple undisclosed programs.

This combination of wholly owned and partnered portfolios across a range of indications and modalities demonstrates our ability to discover and advance novel medicines, many of which selectively target disease proteins previously thought to be undruggable.

The following chart summarizes our clinical and preclinical pipelines and ongoing clinical studies:

Clinical Pipeline

Our portfolio of targeted protein degraders of the B‑cell signaling protein BTK comprises NX‑5948, an investigational, orally bioavailable, highly selective BTK degrader for the treatment of relapsed or refractory B-cell malignancies and potentially autoimmune diseases, and NX‑2127, an investigational, orally bioavailable degrader that simultaneously degrades BTK and two well-characterized cereblon neosubstrates IKZF1 (Ikaros) and IKZF3 (Aiolos) that are clinically validated transcription factor targets for relapsed or refractory B‑cell malignancies.

Status of NX-5948:

We are currently conducting a Phase 1b cohort expansion study of NX-5948 in patients with relapsed or refractory B-cell malignancies.

In January 2024, the U.S.

Food and Drug Administration (FDA) granted Fast Track designation for NX-5948 for the treatment of adult patients with relapsed or refractory chronic lymphocytic leukemia (CLL) or small lymphocytic lymphoma (SLL) after at least two lines of therapy, including a BTK inhibitor (BTKi) and a B-cell lymphoma 2 (BCL2) inhibitor.

We are currently treating patients in a Phase 1a/1b dose-escalation and cohort expansion study of NX-2127 in patients with relapsed or refractory B-cell malignancies.

We have initiated Phase 1b expansion cohorts for patients with relapsed CLL, diffuse large B-cell lymphoma (DLBCL) and mantle cell lymphoma (MCL).

Enrollment of new patients in this clinical trial is paused pending resolution of a partial clinical hold, which was implemented by the FDA in late October 2023.

Patients already enrolled who are receiving clinical benefit may continue treatment.

Targeted Protein Elevation

Our targeted protein elevation program includes NX-1607, an orally bioavailable an inhibitor of CBL-B, an E3 ligase that regulates the activation of multiple immune cell types including T cells and NK cells.

NX-1607 is targeted for immuno-oncology indications.

We are currently treating patients in a Phase 1a/1b dose-escalation and cohort expansion study of NX-1607 in patients with a range of oncology indications.

In November 2024, the European Medicines Agency (EMA) granted Priority Medicine (PRIME) designation for NX-5948 in CLL or SLL after at least a BTK inhibitor and a BCL-2 inhibitor.

In December 2024, the FDA granted Fast Track designation for NX-5948 for the treatment of adult patients with Waldenstrom’s macroglobulinemia (WM) after at least two lines of therapy, including a BTK inhibitor.

Status of NX‑2127:

We are currently conducting a Phase 1a/1b dose-escalation and cohort expansion study of NX-2127 in patients with relapsed or refractory B-cell malignancies.

We previously initiated Phase 1b expansion cohorts for patients with relapsed CLL, diffuse large B-cell lymphoma (DLBCL) and mantle cell lymphoma (MCL).

Enrollment was paused in 2023 due to a partial clinical hold stemming from a manufacturing change designed to produce a chirally controlled form of NX-2127.

Enrollment of new patients in this clinical trial recommenced in August 2024 following resolution of the partial hold by the FDA.

Dose escalation with the new drug form is ongoing with a focus on patients with aggressive forms of B-cell lymphoma, such as DLBCL and MCL.

In addition to our BTK degrader portfolio, we are also advancing a novel immune-oncology inhibitor of the E3 ligase CBL-B.

CBL-B is a RING-type E3 ligase that regulates the activation of multiple immune cell types including T cells and NK cells through protein degradation.

NX-1607 is an orally bioavailable inhibitor of CBL-B that has the potential to relieve T cell anergy and promote anti-cancer immune cell activity.

NX-1607 is currently being explored in a variety of solid tumor indications.

Status of NX-1607:

We are currently conducting a Phase 1a/1b dose-escalation and cohort expansion study of NX-1607 in patients with a range of oncology indications.

This study also includes a cohort within the Phase 1a dose escalation study testing NX-1607 in combination with paclitaxel, a taxane chemotherapy commonly used across a range of relapsed and refractory solid tumor indications.

NX-1607 was awarded an Innovative Passport from the UK Medicines and Healthcare products Regulatory Agency to accelerate time to market and facilitate patient access to novel drugs to treat serious and life-threatening diseases.

Drug Discovery Pipeline

In addition to our clinical stage drug candidates, we are extending our protein modulation portfolio, both on our own and with partners by developing new targeted protein degraders and ligase inhibitors for a number of targets for which we believe the protein modulation modality can be clinically advantageous over existing therapies.

These existing and future programs may have the potential to address diseases with significant unmet need, including cancer, autoimmunity, inflammation, and other challenging diseases.

We have entered into several revenue generating collaborations with large biopharmaceutical companies, including with Gilead, Sanofi and Seagen (now a part of Pfizer), to leverage our DELigase platform for drug discovery.

These collaborations allow us to further advance our future pipeline with multiple currently identified targets included in these collaborations.

In aggregate, we have received $413.0 million in non-dilutive financing from our collaborators to date, and as of November 30, 2023, we are eligible to receive up to $8.1 billion in potential future fees and milestone payments, as well as royalties on future product sales.

In 2022, NX-1607 was awarded an Innovation Passport from the United Kingdom (UK) Medicines and Healthcare products Regulatory Agency to accelerate time to market and facilitate patient access to novel drugs to treat serious and life-threatening diseases.

Preclinical Pipeline

In addition to our clinical stage drug candidates, we are advancing multiple preclinical-stage programs within our protein degradation portfolio, both on our own and with partners, by developing new targeted protein degraders and degrader antibody conjugates for several therapeutic indications that currently lack treatment options or where current therapies are ineffective.

These existing and future programs have the potential to provide patients with better options in therapeutic indications with significant unmet needs, including cancer, inflammation, autoimmunity and other challenging therapeutic areas.

We have entered into several revenue generating collaborations with large biopharmaceutical companies, including Gilead, Sanofi and Pfizer, to leverage our DEL-AI platform for drug discovery.

As of November 30, 2024, we have received a total of $435.0 million in non-dilutive financing from our collaborators, and we are eligible to receive up to $7.1 billion in potential future fees and milestone payments, as well as royalties on future product sales.

We retain certain options for co-development, co-commercialization and profit sharing in the United States for multiple drug candidates pursuant to these collaborations.

Corporate Strategy

Our strategy is to leverage our DELigase platform to discover breakthrough therapies to not only improve upon existing drugs, but also address targets that are thought to be undruggable with current modalities.

Our strategy is to discover and develop breakthrough therapies for patients with significant unmet clinical need by developing highly differentiated targeted protein degrader drugs that eliminate disease-causing or disease-associated biological targets that to date have been ineffectively drugged or have been considered undruggable with existing modalities.

The key elements of our strategy are to:

• Advance our lead programs through clinical development .

We have three drug candidates in Phase 1 clinical development and anticipate the following advancements in 2024.

Enrollment is ongoing in our Phase 1a/1b clinical trial of NX-5948 in adults with relapsed or refractory B-cell malignancies, including CLL.

In 2024, we seek to define doses for Phase 1b cohort expansion in CLL and NHL and accelerate Phase 1 clinical trial enrollment to enable pivotal trials.

We plan to present additional clinical data with higher dose levels and longer treatment duration in mid-2024.

Screening and enrollment of new patients in our Phase 1a/1b clinical trial of NX-2127 in adults with relapsed or refractory B-cell malignancies have been paused due to a partial clinical hold placed on the study by the FDA.

Patients currently enrolled in the clinical study who are deriving clinical benefit may continue to receive treatment in accordance with the ongoing study protocol.

In 2024, we expect to resolve the partial clinical hold to enable the introduction of newly manufactured drug product into the ongoing Phase 1 clinical trial.

Enrollment is ongoing in our Phase 1 trial for NX-1607 in adults with a range of oncology indications.

In 2024, we expect to present data from the Phase 1a dose escalation portion of the trial of NX-1607 and to define dose(s) to enable Phase 1b cohort expansion.

• Advance our portfolio of preclinical programs to generate development candidates for our partners and our proprietary pipeline.

Our research efforts are largely focused on the advancement of multiple programs for our partners Gilead, Sanofi, and Pfizer and for our proprietary pipeline.

These partnered and wholly owned programs are at various stages of DNA-encoded library (DEL) screening, lead optimization and preclinical research.

We aim to advance at least one program to the development candidate stage in 2024.

• Enhance and refine our DELigase platform .

Targeted Protein Modulation is a rapidly emerging therapeutic modality that can provide significant advantages over existing modalities.

Our proprietary DELigase platform enables us to advance an industry-leading approach to either selectively decrease or increase protein levels.

We intend to continue to invest resources in our research and development activities to enhance our DELigase platform both in terms of the number of ligases available for drug discovery and the scale of our DEL collection.

We plan to continue to leverage our platform capabilities to further enhance our position as a leader in the promising field of protein modulation.

• Explore additional strategic collaborations to maximize the commercial potential of our DELigase platform and our drug candidates .

We have received $413.0 million in non-dilutive funding to date from our collaborations to support our research and development activities and to create new targeted protein modulation drugs with our partners.

Under our Gilead, Sanofi and Pfizer collaborations, as of November 30, 2023, we have the opportunity to receive up to $8.1 billion in potential future fees and milestone payments, as well as royalties on future sales while retaining certain commercialization options.

We currently retain worldwide development and commercialization rights to our BTK and CBL-B portfolios.

While we intend to become a fully integrated biopharmaceutical company and build a targeted sales force in the United States to support the commercialization of our drug candidates, if approved, we intend to selectively evaluate technology collaborations and commercialization partnerships for our drug candidates with partners whose capabilities complement our own while retaining meaningful commercial rights in key geographic territories.

Targeted Protein Modulation

In disease settings where currently available treatments are limited by suboptimal efficacy or safety, or where relevant protein targets are not druggable by conventional means, we believe targeted protein modulation represents a novel treatment paradigm with the potential to improve upon or become the standard of care.

Recent advances in the field have highlighted the significant therapeutic potential of harnessing E3 ligases to promote targeted protein degradation.

In addition, we believe the largely unexplored area of inhibiting E3 ligases directly to increase protein levels represents an equally promising approach.

Using our powerful DELigase platform, we have demonstrated our ability to discover and advance small molecule drug candidates to decrease or increase protein levels by either harnessing or inhibiting the activity of the appropriate E3 ligase, depending on the desired therapeutic effect.

We have carefully selected and are advancing over 90 E3 ligases in our DELigase platform, expanding the universe of E3 ligases that can be modulated beyond cereblon and von Hippel-Lindau (VHL), the two predominantly used in the field of targeted protein degradation today.

Our DEL collection consists of billions of small molecule compounds used to identify potential binders to ligases and protein targets as critical starting points in our drug discovery process.

The differentiation of our protein modulation platform is in its breadth and versatility, enabling us to alter protein levels either upward or downward for both clinically validated targets, such as BTK, and for targets previously thought to be “undruggable;” that is, proteins that could not be addressed by conventional pharmacological means, such as CBL-B.

Proteins as targets in treating disease

Each cell type within the body is comprised of proteins that define its biochemistry and biological function.

When proteins are expressed and regulated correctly, the health of each individual cell as well as the body as a whole is maintained.

However, disease can occur when normal cellular processes are dysregulated as a result of changes in protein structure, function, expression levels or pathway regulation.

Factors such as genetic mutations, infection, exposure to toxins, diet and behavior can lead to dysregulation of cellular processes and, if unchecked, a disease process.

The traditional approach to discovering treatments for disease has involved the development of small molecule drugs that bind to a protein’s surface and modulate its activity.

These “druggable” proteins contain distinct structural features that mediate protein function called active sites which can be exploited when identifying and optimizing compounds that disrupt protein activity.

However, the vast majority of the body’s proteins do not have distinct active sites that can be targeted using traditional discovery methods.

Because dysregulation and disease are not restricted to these “druggable” proteins, a significant number of therapeutically relevant proteins have not been addressed by traditional small molecule drugs.

Other modalities, including antibody and protein-based therapies, genetic medicines and cell therapies, have emerged to address these issues but are still limited by their modes of delivery, their scalability and their therapeutic applications.

Leveraging E3 ligases and the ubiquitin proteasome system as a new treatment modality

Normal cellular physiology requires highly orchestrated and regulated processes that operate at the level of individual proteins.

The ability of proteins to respond to stimuli quickly and in a coordinated fashion requires protein function to be readily controllable.

One of the most exquisitely ordered cellular systems governing cellular proteins is the ubiquitin proteasome system (UPS).

As depicted above, the UPS is responsible for regulating and maintaining normal protein levels in the cell.

An important class of enzymes called E3 ligases mediate this process with a high degree of specificity by recognizing individual proteins and catalyzing the attachment of ubiquitin protein tags to their surface.

Proteins marked with chains of ubiquitin are then shuttled to the proteasome for degradation and removal from the cell.

In addition to protein degradation, E3 ligases also mediate other functions such as protein localization, receptor internalization, protein signaling and protein quality control.

There are over 600 E3 ligases encoded within the human genome, representing more than 5% of genes.

The prevalence of the E3 ligase class of enzymes reflects the diversity of their physiological roles and biological significance and may allow for the creation of a wide spectrum of ligase-targeted therapeutics.

Modulating protein levels through small molecule therapeutics targeting E3 ligases

Advances in our understanding of the UPS suggest broad potential for the development of new therapies that modulate E3 ligases in the context of diseases such as cancer and autoimmune disorders.

An example are the so-called immunomodulatory drugs, Revlimid (lenalidomide) and Pomalyst (pomalidomide), which are approved cancer drugs.

These drugs exert their therapeutic effects by targeting the E3 ligase cereblon and redirecting its activity toward proteins it would not normally degrade such as Ikaros and Aiolos (also known as IKZF1 and IKZF3), transcription factors regulating immune cell function.

Elucidation of this mechanism led to the recognition that pharmacological control of E3 ligase activity could more generally represent a promising new paradigm for small molecule drug action.

This idea has since translated into the development of targeted protein degraders, which we believe have significant therapeutic potential.

In addition, the largely unexplored area of inhibiting E3 ligases directly to increase cellular protein levels, which we call Targeted Protein Elevation, may represent an equally promising approach.

Targeted Protein Modulation is the term we use to describe our ability to either decrease target protein levels by harnessing E3 ligases for targeted protein degradation or increase protein levels through the inhibition of E3 ligases for targeted protein elevation.

• Targeted Protein Degradation (Harnessing E3 ligases).

Targeted protein degradation harnesses the natural activity of ligases to remove specific proteins from the cell.

Targeted protein degradation is accomplished by using bifunctional small molecules, which are composed of an E3 ligase binding element, or harness, linked to a target protein binding element.

Unlike traditional small molecule inhibition, targeted protein degradation is catalytic whereby one molecule can induce the degradation of multiple copies of the protein target, enabling the efficient elimination of cellular proteins.

In addition, since the effect is mediated through the binding of a small molecule drug rather than through functional inhibition, proteins lacking active sites are potentially targetable, greatly expanding the spectrum of both proteins and diseases amenable to small molecule therapeutic intervention .

• Targeted Protein Elevation (Inhibiting E3 ligases).

By inhibiting the function of E3 ligases in targeted protein elevation, it is possible to rapidly increase specific protein levels to control biological pathways.

Increasing the levels of distinct sets of proteins could be a powerful approach to blocking pathological processes and restoring normal physiology.

While there is enthusiasm in the scientific community around the therapeutic potential of E3 ligase inhibition, the discovery of such inhibitors has been impeded by the limited understanding of this biochemically and structurally complex class of proteins.

Targeted Protein Modulation

We believe that targeting E3 ligases to modulate protein levels represents a new therapeutic frontier that retains the favorable attributes of small molecule treatment modalities while addressing some major limitations.

In addition to the points above, we believe other key differentiating attributes of our treatment modality include:

• Expansive therapeutic potential .

The UPS and its associated E3 ligases function across the majority of cell types and organ systems, making it possible to modulate virtually any protein of interest for a wide range of diseases.

• Deliverable and tunable .

Oral delivery of small molecule compounds lends itself to broad medical applicability in a range of patient populations with delivery that may be readily calibrated through dosing schedule and quantity.

• Ease of manufacturing .

Development and manufacturing of small molecules utilizes established, cost-efficient processes that are readily scalable.

Our targeted protein degradation portfolio includes two clinical stage drug candidates that catalyze potent degradation of BTK, a well validated target for B-cell malignancies.

Our two BTK degrader drug candidates, NX-5948 and NX-2127, are oral drug candidates being evaluated for the treatment of relapsed or refractory B-cell malignancies including CLL and non-Hodgkin’s lymphoma (NHL).

NX-5948 is designed to solely degrade BTK, and NX-2127 is designed to degrade BTK and the immunomodulatory substrates of Ikaros and Aiolos.

NX-5948 has the potential to address B-cell mediated autoimmune indications due to its specificity for BTK, and neurologic autoimmune indications due to its ability to cross the blood brain barrier.

In preclinical studies and in patient-derived samples, we have demonstrated the ability of both NX-5948 and NX-2127 to degrade BTK in cells harboring either wild type BTK or a variety of clinically relevant mutant forms of BTK that are known to confer resistance to both currently marketed BTK inhibitors and next-generation BTK inhibitors in late-stage development.

Based on our preclinical and clinical data, we believe that both NX-5948 and NX-2127 have the potential to demonstrate unique and improved clinical benefit over the current standard-of-care in multiple oncology indications.

Our targeted protein elevation portfolio includes our lead ligase inhibitor NX-1607, an oral, clinical stage small molecule drug candidate that inhibits CBL-B, an intracellular orchestrator of the activation of T cells, B cells and NK cells.

In preclinical studies, primary human T cells exposed to NX-1607 demonstrated increased T-cell activation in the absence of co-stimulation with CD3 and CD28, a potential advantage in an immune suppressive tumor microenvironment.

In addition, NX-1607 has been shown in preclinical models to increase T‑cell proliferation and result in increased secretion of interleukin-2 (IL-2), a key cytokine involved in immune activation.

We believe that oral delivery of a CBL-B inhibitor has the potential to drive immune cell activation and stimulation of localized IL-2 secretion, leading to enhanced anti-tumor response across a wide range of oncology indications.

Targeted protein degradation portfolio in clinical trials

We have developed two targeted protein degrader drug candidates that are potent degraders of the BTK protein, a clinically validated signaling factor that drives B-cell activation and proliferation.

Both of our BTK degraders harness the E3 ligase cereblon.

NX-5948 is designed to selectively degrade BTK and has demonstrated the ability to cross the blood brain barrier in animal models and degrade BTK in both brain-resident tumor cells and normal microglia in the brain.

NX-2127 was engineered to degrade both BTK and cereblon neosubstrates Ikaros and Aiolos for the treatment of relapsed or refractory B-cell malignancies.

In several B-cell malignancy indications, and in particular in certain NHL subtypes, we believe dual activity may provide therapeutic advantages not addressable by pure BTK degraders or inhibitors, that could in turn result in improved outcomes for patients.

We are currently treating patients with relapsed or refractory B-cell malignancies in Phase 1 trials for NX-5948 and NX-2127.

• Advance our lead program, NX-5948, into late-stage clinical development in CLL and potentially other B-cell malignancies.

Enrollment is ongoing in our Phase 1b clinical trial of NX-5948 in adults with relapsed or refractory B-cell malignancies.

In 2025, we intend to commence enrollment of a suite of additional trials designed to support the potential future registration of the drug in multiple regulatory jurisdictions.

We plan to leverage the Fast Track designation from the FDA in CLL and WM as well as the PRIME designation from the EMA to accelerate the clinical development and registrational path for NX-5948 in oncology.

• Explore the therapeutic applications of our lead BTK degrader, NX-5948, for the treatment of patients with diseases caused by inflammation and autoimmunity.

BTK mediates signaling downstream of the B-cell receptor (BCR), toll-like receptors (TLRs), and Fc receptors (FcRs), making it an attractive therapeutic target in antibody-mediated autoimmune and inflammatory diseases.

Targeting BTK can reduce the production of new antibodies and mitigate inflammation induced by a variety of inflammatory signals, addressing key challenges in inflammatory and autoimmune diseases.

We believe that NX-5948 may offer unique advantages over currently available BTK inhibitors in these disease indications by addressing both the enzymatic and scaffold activities of BTK, which are key to its function.

In 2025, we plan to expand the current Phase 1b trial in patients with CLL to include patients who are also suffering from immune-mediated cytopenias such as anemia, a common co-morbidity associated with CLL.

In 2025, we may further explore the utility of NX-5948 in autoimmune and inflammatory diseases with a separate clinical program which will require an IND with a separate division at the FDA.

• Continue development of NX-2127 through dose escalation with a focus on aggressive lymphomas including MCL and DLBCL.

Enrollment of new patients in our Phase 1a/1b clinical trial of NX-2127 has resumed in adults with relapsed or refractory B-cell malignancies.

In 2025, we expect to define doses to enable a Phase 1b cohort expansion.

• Continue development of NX-1607 through dose escalation in a range of solid tumor indications.

Enrollment is ongoing in our Phase 1a/1b trial for NX-1607 in adults with multiple solid tumor types.

In 2025, we expect to define doses and potential indications to enable a Phase 1b cohort expansion.

• Advance our portfolio of preclinical programs to generate development candidates and license agreements for our partnered pipeline.

Our partnership efforts are focused on the advancement of a robust and sustainable pipeline in collaboration with our partners Gilead, Sanofi, and Pfizer.

In our more mature partnerships with Gilead and Sanofi, multiple disclosed and undisclosed programs are advancing through lead optimization and IND-enablement.

In March 2023, Gilead licensed our IRAK4 TPD program under the collaboration, and in March of 2024, Gilead extended the research term of multiple TPD programs.

In April 2024, Sanofi extended its research term for a STAT6 targeted protein degrader with the goal of selecting a development candidate in the first half of 2025.

In our partnership with Pfizer, which was announced in September 2023 under an agreement with Seagen, Inc., we have achieved two preclinical milestones to date, qualifying for $10.0 million in milestone payments.

We expect to earn multiple additional preclinical and clinical milestones across our three active partnerships in 2025, which may allow us to secure additional license and development candidate events in subsequent years.

• Advance our proprietary portfolio of preclinical programs toward additional INDs.

The leading edge of our proprietary preclinical portfolio includes our pan-mutant BRAF program, which is designed to specifically target and degrade multiple mutant forms of the BRAF protein for the treatment of solid tumors including melanoma, colorectal cancer and non-small cell lung cancer.

Lead compounds from this program show potency against the most common class I V600E BRAF mutation, but also potently degrade a broad spectrum of other BRAF driver mutations including those characterized as class II or III, all while sparing wild-type BRAF activity.

The series of mutant BRAF degrader compounds has been optimized for oral bioavailability and CNS exposure, a profile that is critical in the setting of relapsed BRAF-driven disease.

We believe our degraders will be clinically advantageous over existing therapies based on in vivo preclinical models that show improved potency against clinically relevant BRAF mutations and superior efficacy compared to other clinical and preclinical BRAF and RAF agents.

Our BRAF degraders are likely to provide a greater therapeutic window compared to existing BRAF agents because they avoid paradoxical pathway activation while preserving normal wild-type BRAF function.

We believe that a pan-mutant BRAF degrader will provide more sustained MAPK pathway suppression through its catalytic mechanism of action with the potential to target relapsed and refractory BRAF-mutant positive class I patient populations as well as class II and III BRAF patients for which there exists no approved BRAF therapies.

In addition to targeted protein degraders of mutant BRAF, we are advancing multiple other proprietary programs targeting mutant proteins or other disease-drivers that are currently at various stages of preclinical discovery from DNA-encoded library screening to lead optimization and development candidate nomination.

• Build a leading platform for discovery of degrader antibody conjugates.

DACs combine the selective and potent catalytic activity of targeted protein degraders with the cell- and tissue-specific delivery capabilities of antibodies.

DACs represent the next generation of antibody drug conjugate technology that is designed to allow for the application of uniquely targeted payloads that can deliver more precise drug action while also providing multiple layers of cellular and molecular selectivity to potentially achieve both enhanced safety and improved efficacy.

As part of our strategy to accelerate DAC discovery and demonstrate value, we have partnered with Pfizer, the leading pharmaceutical company in the antibody drug conjugate space, to advance this cutting-edge modality.

By combining Nurix’s experience in machine learning, automated chemistry and targeted protein degraders with Pfizer’s expertise in antibody conjugate design, optimization and development, we believe we can achieve technical synergies that could allow us to redefine the application of antibody conjugates for not only oncology but also non-oncology indications.

In addition to the DACs in the Pfizer collaboration, we are pursuing multiple wholly owned DAC programs.

• Grow our proprietary pipeline by expanding the capabilities of our DEL-AI platform.

Targeted protein degradation is rapidly becoming the therapeutic modality of choice for an increasing list of pharmaceutical targets.

To unlock the full potential of TPD, it is essential to have ready access to chemical starting points for biological pathways and targets that historically have been considered undruggable but now are rendered tractable by this more versatile approach.

We believe we are uniquely positioned to identify novel chemical starting points to undruggable proteins and ligases.

We have developed a suite of AI tools applicable across the breadth of our technical workflows, but with a specific focus on prospective ligand discovery informed by our years of accumulated DEL know-how and screening data.

Using our SP3-enriched, proprietary DNA-encoded libraries and complementary E3 ligase-enriched DEL screening data, we have created a leading AI-powered platform which is designed to quickly generate multiple potential starting points for degrader drugs, thereby opening access to hundreds of unprecedented drug targets and target families.

Further, the predictive power of this platform extends our drug development capabilities into a broadening range of induced proximity modalities including novel molecular glue degraders and protein stabilizers.

Our DEL-AI platform can reduce reliance on serial wet-lab protein chemistry and screening efforts on challenging targets and instead can provide nearly instant access to drug-like and selective DEL binders to potentially any target or target class.

By employing advanced machine learning models informed by empirical degrader assay datasets we amassed, which include a compendium of in vitro and in vivo pharmacokinetic and pharmacodynamic readouts from tens of thousands of targeted protein degrader compounds, we have the ability to reduce the number of design-make-test cycles in our optimization campaigns, eliminate optimization bottlenecks, and shorten the overall project timelines required to achieve desired TPD target product profiles.

We plan to continue to invest in and leverage our purpose-built machine learning capabilities and DEL-AI research engine, which we believe will enable us to enhance our position as a leader in degrader drug discovery and deliver a robust and sustainable drug pipeline.

• Explore additional strategic collaborations to maximize the commercial potential of our existing pipeline assets as well as our DEL-AI and DAC platforms.

As of November 30, 2024, we have received a total of $435.0 million in non-dilutive funding from our collaborations, which has enabled us to invest in our own research and development activities.

Under our Gilead, Sanofi and Pfizer collaborations, we have the potential to receive up to $7.1 billion in future fees and milestone payments, as well as royalties on future sales, and we retain certain options for co-development, co-commercialization and profit sharing in the United States for multiple drug candidates.

We currently retain worldwide development and commercialization rights to our BTK and CBL-B clinical portfolios as well as numerous preclinical-stage projects, including our BRAF program.

We intend to become a fully integrated biopharmaceutical company by building a targeted sales force in the United States and potentially other countries to support the commercialization of our approved drug candidates.

In addition, we plan to selectively pursue technology collaborations and commercialization partnerships with partners whose capabilities complement our own, while retaining significant commercial rights in key geographic territories.

Our Clinical Programs

BTK’s role in B-cell malignancy

BTK is a key component of the B-cell receptor signaling pathway and has been clinically validated as a target in the treatment of B-cell malignancies, most notably in CLL but also in NHL.

In 2022, it was estimated that over 20 thousand patients were diagnosed with CLL and over 80 thousand patients were diagnosed with NHLs in the United States.

It is estimated that in 2024, in the United States, over 20,000 patients were diagnosed with CLL and over 80,000 patients were diagnosed with NHLs.

Approximately 85% of NHLs are a result of B-cell malignancies.

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Background on BTK inhibitors and immunomodulatory drugs for B-cell malignancies

The first generation BTK inhibitor Imbruvica, or ibrutinib, is approved for the treatment of CLL, Waldenstrom’s macroglobulinemia (WM), and chronic graft versus host disease (GVHD).

The first generation BTK inhibitor Imbruvica, or ibrutinib, is approved for the treatment of CLL, WM and chronic graft versus host disease.

Second generation BTK inhibitors include Calquence, or acalabrutinib, which is approved for use in CLL and MCL, and Brukinsa, or zanubrutinib, which is approved for use in CLL, MCL, WM and marginal zone lymphoma (MZL).

Based on reported sales to date, we estimate that 2023 BTK sales were approximately $8.7 billion.

These BTK inhibitors bind covalently to cysteine C481 of the BTK protein and irreversibly inhibit BTK;

however, all have some off-target binding to other kinases, which leads to unwanted side effects.

In addition, acquired resistance, most commonly through mutations in C481, may limit long term efficacy of these first and second generation BTK inhibitors.

In addition, acquired resistance, most commonly through mutations in C481, may limit the long-term efficacy of first and second generation covalent BTK inhibitors.

A number of noncovalent BTK inhibitors are currently being investigated in clinical trials as potential therapies for patients with relapsed and refractory disease, including Jaypirca, or pirtobrutinib, which was recently approved for use in CLL and MCL.

However, the noncovalent inhibitors are also subject to acquired resistance, and treatment with these agents has led to the discovery of a broad range of new resistance mutations.

However, noncovalent inhibitors are also subject to acquired resistance, and treatment with such agents has led to the discovery of a broad range of new resistance mutations.

Based on reported sales to date, we estimate that sales of BTK inhibitors were approximately $8.8 billion in 2023.

BTK degraders possess several unique properties that offer potential advantages over inhibitors:

• Addresses scaffold function of BTK .

Removal of the BTK protein rather than just inactivating the kinase domain addresses the scaffolding activity of BTK, more completely blocking the signaling activity of both wild type and mutant forms of BTK.

• Event-driven pharmacology.

BTK degraders do not require strong and prolonged binding to BTK to trigger degradation, which increases the ability our degraders to act on mutated BTK and may decrease the probability of forming new resistance mutations.

Removal of the BTK protein rather than inactivating the kinase domain addresses the scaffolding activity of BTK, more completely blocking the signaling activity of both wild-type and mutant forms of BTK.

• Address BTK inhibitor resistance mutations through event-driven pharmacology.

BTK degraders do not require strong and prolonged binding to BTK to trigger degradation, which increases the ability of degraders to act on mutated BTK and may decrease the probability of forming new resistance mutations.

• Catalytic activity .

A single degrader molecule is able to affect multiple target BTK molecules sequentially without the need to be constantly bound to the target.

A single degrader molecule is able to trigger degradation of thousands of BTK target proteins sequentially without the need to be constantly bound to the target.

We believe that targeted protein degradation of BTK may be a superior approach to existing covalent or noncovalent BTK inhibitors, particularly in the relapsed and refractory setting, and in the setting of resistance mutations to both covalent and noncovalent inhibitors.

The immunomodulatory drugs including Revlimid, or lenalidomide, and Pomalyst, or pomalidomide, are analogs of Thalomid, or thalidomide.

Immunomodulatory drugs, including Revlimid, or lenalidomide, and Pomalyst, or pomalidomide, are analogs of Thalomid, or thalidomide.

These drugs possess several anti-tumor properties, including anti-angiogenic and anti-proliferative effects.

They also have multiple effects on the immune system, including enhancement of T-cell mediated and NK-cell mediated immunity.

They also have multiple effects on the immune system, including the enhancement of T-cell mediated and NK-cell mediated immunity.

Revlimid, the market leader in this class by global sales, was first approved in 2006 for the treatment of multiple myeloma.

In May of 2019, Revlimid in combination with Rituxan received a supplemental indication approval for previously treated FL, MZL and MCL, and in August of 2020, Revlimid in combination with Monjuvi received a supplemental indication in DLBCL, thus validating the importance of this drug class in these indications.

In 2022, global sales of this drug class including Revlimid and Pomalyst were approximately $13.5 billion.

Subsequent to their approval and successful commercialization, studies demonstrated that these immunomodulatory drugs exert their therapeutic effect by triggering the degradation of specific proteins including Aiolos and Ikaros through the E3 ligase activity of cereblon and hence were identified retrospectively as the first approved drugs to target an E3 ligase.

Published studies have recently reported early clinical data showing that combining a BTK inhibitor with an immunomodulatory drug may have the potential to augment clinical activity of certain standard of care agents in some hematologic malignancies such as non-germinal center B-cell like (non-GCB) DLBCL.

Further, scientific publications have previously described synthetic lethality in a DLBCL cell line treated with both ibrutinib and lenalidomide.

In May 2019, Revlimid in combination with Rituxan received a supplemental indication approval for previously treated FL, MZL and MCL, and in August 2020, Revlimid in combination with Monjuvi received a supplemental indication in DLBCL, thus validating the importance of this drug class in these indications.

Based on reported sales to date, global sales of this drug class, including Revlimid and Pomalyst, peaked in 2021 at approximately $16.2 billion, prior to the introduction of generic competition.

Subsequent to their approval and successful commercialization, studies demonstrated that these immunomodulatory drugs exert their therapeutic effect by triggering the degradation of specific proteins including Ikaros and Aiolos through the E3 ligase activity of cereblon, and hence were identified retrospectively as the first approved drugs to target an E3 ligase.

Recently published studies have reported early clinical data showing that combining a BTK inhibitor with an immunomodulatory drug may have the potential to augment clinical activity of certain standard of care agents in some hematologic malignancies such as non-germinal center B-cell like (non-GCB) DLBCL.

Further, earlier scientific publications have described synthetic lethality in a DLBCL cell line treated with both ibrutinib and lenalidomide.

By targeting both BTK and cereblon-mediated immunomodulatory pathways simultaneously, it is believed that the survival mechanisms driven by accumulated mutations within certain cancers can be overcome, thereby preventing escape and disease relapse.

This may be especially effective if each pathway has not only different functions but also if they share certain critical components.

This may be especially effective if each pathway not only has different functions but also shares certain critical components.

One possible intersection pathway is the suppression of interferon regulatory factor 4 (IRF4), a member of a family of transcription factors leading to a cell-lethal increase in interferon production.

The early clinical study cited above was particularly noteworthy since few combinations have previously produced promising results in DLBCL.

This may suggest that simultaneous degradation of BTK combined with cereblon-mediated immunomodulatory activity by a single agent could produce an additive or synergistic effect in certain B-cell malignancies.

The early clinical study referenced above was particularly noteworthy because, prior to that study, few combinations have produced promising results in DLBCL.

The findings suggest that simultaneous degradation of BTK combined with cereblon-mediated immunomodulatory activity by a single agent could produce an additive or synergistic effect in certain B-cell malignancies.

Potential advantages of BTK degraders

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We have also demonstrated the ability of both NX-5948 and NX-2127 to degrade BTK in circulating B cells of non-human primates and in B-cell lymphoma patients following once daily oral dosing in ongoing Phase 1 trials.

We have specifically designed NX-5948 to degrade BTK with limited or no degradation of cereblon neosubstrates, and we have designed NX-2127 as a dual degrader of BTK as well as the cereblon neosubstrates Aiolos and Ikaros, for potential applications in indications where adding immunomodulatory activity may be beneficial.

We have specifically designed NX-5948 to degrade BTK with limited or no degradation of cereblon neosubstrates.

We have designed NX-2127 as a dual degrader of BTK and the cereblon neosubstrates Ikaros and Aiolos, for potential applications in indications where adding immunomodulatory activity may be beneficial.

We have optimized NX-5948 and NX-2127 to be able to degrade both wild-type BTK and the C481S variant of BTK that has been identified as the most common mutation in patients who have become resistant to ibrutinib therapy over time.

Both agents have subsequently demonstrated the ability to degrade additional mutant variants of BTK associated with resistance to BTK inhibitors including L528W, T474I, M437R and V416L.

In our model of DLBCL cell line (TM8) harboring the most common resistance mutations, both NX-5948 and NX-2127 retained activity while all tested inhibitors demonstrated a major decrease in activity against at least one resistance mutation.

The figure below shows a heat map of the relative activity of NX-5948 compared to a panel of first and second generation covalent BTK inhibitors and non-covalent BTK inhibitors.

Potent tumor growth inhibition was achieved at varying doses of orally administered NX-2127 in mouse xenograft tumor models with a wild type BTK protein, as shown in the figure below on the top right.

In this same model, NX-2127 demonstrated potent degradation of BTK in both circulating B cells (below on the top left) and in lymphoma tumors (below top middle).

In this model system, 80% BTK degradation in circulating B cells correlated with 74% tumor growth inhibition, and 90% BTK degradation in circulating B cells correlated with 100% tumor growth inhibition.

These target levels of inhibition suggest a potential therapeutic range correlating BTK degradation to tumor growth inhibition.

In addition to BTK degradation, we have also demonstrated the ability of NX-2127 to degrade both Aiolos (as shown in the figure below) and Ikaros (not shown), proteins targeted by immunomodulatory drugs Revlimid (lenalidomide) and Pomalyst (pomalidomide).

Studies in human T cells comparing NX-2127 to lenalidomide and pomalidomide have shown comparable Aiolos degradation and resultant T-cell activation, as shown in the figure below.

Based on the clinical data of both ibrutinib and the immunomodulatory drug in B-cell malignancies, we believe that this strategy of targeting both BTK and Aiolos/Ikaros in a single oral treatment may improve anti-tumor activity.

In our model of DLBCL cell line (TM8) harboring the most common resistance mutations, both NX-5948 and NX-2127 retained activity against all of the common clinical BTK inhibitor resistance mutations, while all tested inhibitors demonstrated a major decrease in activity against at least one of these prevalent mutations.

The figure below shows a heat map of the relative activity of NX-5948 and NX-2127 compared to a panel of both covalent and non-covalent BTK inhibitors.

Clinical development studies for NX-5948

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As illustrated in the diagram below, we are conducting a Phase 1a/1b dose-escalation and cohort expansion study of NX-5948 in patients with relapsed or refractory CLL and NHL.

The Phase 1a portion is designed as a monotherapy dose escalation trial to investigate the safety and tolerability of NX-5948 and to identify a biologically active dose for cohort expansion and potentially a maximum tolerated dose.

The Phase 1b portion of the trial is designed as a monotherapy expansion trial in up to five potential cohorts.

The patients in the study represent a heavily pre-treated population with a variety of previous treatment options.

Some patients also have resistance mutations and other high risk molecular features.

The study is currently enrolling in the United States, the United Kingdom (UK) and the Netherlands.

a Subtypes include:

transformed indolent lymphoma (e.g., grade 3b/transformed FL), Richter-transformed DLBCL, high-grade B-cell lymphoma with MYC and BCL-2 and/or BCL-6 rearrangements, high-grade B-cell lymphomas NOS;

b Includes patients with secondary CNS involvement;

c Additional lines of therapy include anthracycline for non-GCB DLBCL and BTKi for MCL

Abbreviations:

BCL-2i , B-cell lymphoma-2 inhibitor;

BTKi , Bruton’s tyrosine kinase inhibitor;

CIT , chemo-immunotherapy;

CLL , chronic lymphocytic leukemia;

CNS , central nervous system;

DLBCL , diffuse large B-cell lymphoma;

FL , follicular lymphoma;

GCB , germinal center B-cell;

MCL , mantle cell lymphoma;

LoT , line of therapy;

MZL , marginal zone lymphoma;

NOS , not otherwise specified;

PCNSL , primary central nervous system lymphoma;

SLL , small lymphocytic lymphoma;

WM , Waldenströms macroglobulinemia

Initial clinical findings

Initial clinical findings from the NX-5948 clinical trial were presented at the 65th American Society of Hematology (ASH) annual meeting in December 2023.

Pharmacokinetics (PK) and pharmacodynamics data from the ongoing Phase 1a trial shown below demonstrate dose-dependent PK and rapid, robust, and sustained BTK degradation in all patients with once daily oral dosing of NX-5948, confirming the findings and projections from previous preclinical research.

NX-5948 C1D1 pharmacokinetics BTK degradation in patients receiving NX-5948

BTK , Bruton’s tyrosine kinase;

MFI , mean fluorescence intensity;

SEM , standard error of the mean

Searle et al., ASH 2023, Poster #4473

Results from the first data disclosure of the NX-5948 Phase 1a trial showed that NX-5948 is well tolerated and demonstrates clinical benefit.

Out of 26 patients dosed, there were no dose limiting toxicities and no treatment emergent adverse events (TEAEs) resulting in drug discontinuation.

There were four NX-5948-related grade ≥3 TEAEs and no related serious adverse events (SAEs).

As of the October 17, 2023 data cutoff, in the CLL patient population six out of seven dosed patients showed clinical benefit, including three partial responses (one ongoing over nine months) and three stable disease outcomes (two still on treatment).

In the NHL patient population (19 dosed), durable responses were noted across indications, with eight patients, or almost half of the patient population, continuing treatment.

An expanded data set from a larger number of patients treated at higher doses and for a longer duration of time is expected in 2024.

NX-5948 CLL efficacy

CI , confidence interval;

We completed enrollment in the Phase 1a portion and commenced the Phase 1b portion of the trial in the second half of 2024 with two doses, 200 mg and 600 mg, in patients with CLL, MZL, FL, and WM.

The patients in the study represent a heavily pre-treated population with a variety of previous treatments.

Some patients also have mutations associated with BTK inhibitor resistance and other high risk molecular and clinical features.

The study is currently enrolling in the United States, the UK, and in selected sites in Europe.

NX-5948 Phase 1 Clinical Study Design

NX-5948 Phase 1 clinical findings in chronic lymphocytic leukemia

Clinical findings from the NX-5948 Phase 1 trial were presented at the 66th American Society of Hematology annual meeting in December 2024 (ASH 2024).

These results included safety findings from a total of 125 patients as of the October 10, 2024 data cut and included efficacy findings from among the 60 CLL patients enrolled at that time.

NX-5948 was well tolerated across all doses evaluated, and safety findings in the CLL/SLL cohort were consistent with the overall population as well as previous safety analyses.

Among the CLL/SLL patients, the most common treatment emergent adverse events were purpura/contusion (36.7%, all grade 1 or 2), fatigue (26.7%, all grade 1 or 2), petechiae (26.7%, all grade 1 or 2), neutropenia (23.3%, 18.3% grade 3 or higher), and rash (23.3%, 1.7% grade 3 or higher).

Importantly, across the entire population, there was only one case of grade 1 atrial fibrillation in a patient with pre-existing atrial fibrillation.

Among the efficacy evaluable patients with CLL/SLL (n=49), NX-5948 treatment resulted in an objective response rate (ORR) of 75.5% across all doses tested (see table below), with the majority of responses occurring at the first assessment (Week 8).

With longer time on treatment, the ORR increased to 84.2% based on an exploratory efficacy analysis of patients who had at least two response assessments (Week 16).

Responses were observed across all populations regardless of prior treatment, baseline mutations, high-risk molecular features, or central nervous system (CNS) involvement.

This includes patients with baseline BTK mutations associated with treatment resistance to both covalent and non-covalent BTK inhibitors.

Robust BTK degradation was observed in all patients, including those with baseline BTK mutations.

NX-5948 was well tolerated across B-cell malignancies, with no additional safety signals observed with longer duration on study or increased dose.

NX-5948 Overall Response Assessment

a Objective response rate includes CR + PR + PR-L

b Patients who progressed prior to their first response assessment and patients who discontinued for any reason after their first response assessment are included in the denominators

c Patients without identified target lesion(s) at baseline are evalueated as disease-evaluable per iwCLL, while they may not be represented in waterfall plot

CLL , chronic lymphocytic leukemia;

CR , complete response;

PD , progressive disease;

PR , partial response;

SD , stable disease

NX-5948 NHL efficacy

CR , complete response;

DLBCL , diffuse large B-cell lymphoma;

FL , follicular lymphoma;

MCL , mantle cell lymphoma;

MZL , marginal zone lymphoma;

NHL , non-Hodgkin’s lymphoma;

PCNSL , primary CNS lymphoma;

iwCLL , International Workshop on CLL;

ORR , objective response rate;

PD , progressive disease;

PR , partial response;

PR-L , partial response with rebound lymphocytosis;

SD , stable disease

WM , Waldenstrom’s macroglobulinemia

Searle et al., ASH 2023, Poster #4473

NX-5948 Phase 1 clinical findings in Waldenstrom’s macroglobulinemia

Clinical findings from the NX-5948 Phase 1 trial were presented at the 12th International Workshop on Waldenstrom’s Macroglobulinemia in Prague, Czech Republic, in October 2024.

These results, also from the October 10, 2024 data cut included the baseline characteristics of the first 13 patients with WM enrolled across both the Phase 1a and Phase 1b portions of the trial, clinical response assessments in nine response-evaluable patients, and duration on study for all 13 patients.

Among the nine patients who were evaluable for response, seven patients (77.8%) had an objective response, and two patients experienced stable disease (22.2%).

All seven responses were observed at the first assessment at eight weeks, and five remained on treatment, with two patients on treatment for longer than one year.

Clinical development of NX-2127

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We plan to focus development in indications where NX-2127 shows evidence of compelling clinical activity and where there is high unmet need.

As illustrated in the diagram below, the Phase 1a/1b dose-escalation and cohort expansion trial is evaluating doses ranging from 50 mg to 300 mg, and currently includes expansion cohorts for patients with CLL, DLBCL and MCL.

The Phase 1a portion is designed as a monotherapy dose escalation trial to investigate the safety and tolerability of NX‑2127 and to identify a maximum tolerated dose for further evaluation.

The Phase 1b portion of the trial is designed as a monotherapy expansion trial in defined cohorts.

We selected a 100 mg dose for a Phase 1b expansion in CLL patients and selected a 300 mg dose for Phase 1b expansion in MCL and DLBCL patients.

The patient population in the trial was heavily pre-treated and included a sizeable proportion of patients with resistance mutations.

Enrollment of new patients in this clinical trial is currently paused pending resolution of a partial clinical hold.

The Phase 1a/1b dose escalation and cohort expansion study was initiated in 2021.

Enrollment was paused in the fourth quarter of 2023 due to a partial clinical hold stemming from a manufacturing change designed to produce a chirally controlled form of NX-2127.

Enrollment of new patients in the NX-2127 clinical trial recommenced in August 2024, following resolution of the partial hold by the FDA.

Dose escalation with the new drug form is ongoing with a focus on patients with aggressive forms of B-cell lymphoma.

As illustrated in the diagram below, the Phase 1a/1b trial is currently evaluating doses of the new drug product ranging from 100 mg to 450 mg, with potential expansion cohorts for patients with DLBCL, MCL, FL, MZL, and WM.

Patients enrolled in the clinical study who are deriving clinical benefit on the original drug product may continue to receive treatment in accordance with the ongoing study protocol, but all new patients are being treated with the new drug product.

NX-2127 Phase 1 Study Design

a Planned number of evaluable patients (i.e., meeting DLT evaluability criteria);

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WM , Waldenstrom's macroglobulinemia

Clinical findings

Updated data from the NX-2127 clinical study presented at the 65th ASH annual meeting in December 2023 described positive data for NX-2127 in patients with NHL and CLL, confirming a manageable safety profile that is consistent with previous reports for BTK-targeted and immunomodulatory therapies.

BTK and Ikaros degradation was demonstrated at all dose levels in patient samples, as shown in the figure below.

NX-2127 Clinical findings

Positive data from the NX-2127 clinical study was presented at the 65th ASH annual meeting in December 2023 (ASH 2023) and ASH 2024, in patients with NHL and CLL, confirming a manageable safety profile that is consistent with previous reports for BTK-targeted and immunomodulatory therapies.

BTK degradation was demonstrated at all dose levels in patient samples, as shown in the figure below.

Danilov et al., ASH 2023, Poster #4463

The safety findings from the study confirmed the manageable and predictable safety profile.

To evaluate the immunomodulatory effects of NX-2127, circulating patient PBMCs were collected at baseline, after 1 week (C1D8, acute assessment), and following one treatment cycle (C2D1, sustained effects;

28-day cycle).

Single-cell sequencing analysis was performed to compare gene signatures between responders (R;

patients achieving a best response of PR or PR with lymphocytosis) and non-responders (NR;

patients achieving SD or PD).

The analysis revealed distinct differences between responders and non-responders within CD4+ and CD8+ T-cell subpopulations.

In CD4+ T cells, as shown in Figure A, responders exhibited increased expression of activation markers, including CD69 and ICOS, as well as upregulation of oxidative phosphorylation-related genes, such as COX7B and NDUFA5.

In CD8+ T cells, as shown in Figure B, non-responders displayed higher expression of exhaustion markers, including TOX, PD-1, and TIGIT, consistent with immune dysfunction.

The fold-change plot in Figure B illustrates the progressive increase in TOX expression in non-responders relative to responders over time, highlighting these differences.

These findings provide evidence supporting the potential of NX-2127 to modulate T-cell function, which may contribute to its observed clinical activity in patients with CLL.

NX-2127 modulates patient T cells, contributing to its clinical efficacy in CLL patients

Tiana et al., ASH 2024, Oral Presentation

The findings from the study confirmed the manageable and predictable safety profile.

The most common TEAEs (any grade) were fatigue, neutropenia, hypertension, bruising/contusion, and diarrhea.

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Efficacy findings showed promising clinical activity:

For patients with NHL encouraging and durable responses were observed, including two complete responses at week eight and two partial responses at week eight.

For patients with NHL, encouraging and durable responses were observed, including two complete responses and two partial responses, each at week eight.

For patients with CLL, despite a median of five prior lines of treatment and BTK mutations present in 36% of patients, NX-2127 treatment resulted in an objective overall response rate of 40.7%, including partial responses in 11 patients, with treatment ongoing in 13 patients.

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Danilov et al, ASH 2023, Poster #4463

Targeted protein elevation portfolio in clinical trials

Background on CBL-B

T cells play a key role in cell-mediated adaptive immune response.

Activation, expansion and function of antigen-specific T cells is a multistep process and its outcome depends on the balance of positive and negative feedback mechanisms controlling each step.

Many factors can hamper the development of an efficient anti-tumor immune response, such as insufficient expression of tumor antigens, defective antigen presentation, inhibitory molecular interactions including those effected by immune checkpoints, immune suppressive factors or suppressor cells and T-cell exhaustion.

CBL-B, an E3 ligase expressed in immune cell lineages, functions as an intracellular orchestrator of the immune response by negatively regulating T-cell activation, as illustrated above.

CBL-B also limits function and survival of NK cells, B cells and dendritic cells as well as promotes T-cell exhaustion, anergy, and cell death.

As such CBL-B represents a pivotal pathway negatively regulating immunity.

CBL-B deficient animal models demonstrate enhanced signal dependent T-cell activation and robust T-cell dependent anti-tumor immunity.

CBL-B is highly expressed in human CD4+ and CD8+ T cells, with expression tightly regulated by CD28 and CTLA-4 and other co-stimulatory and inhibitory signals.

T cells typically require two signals for activation, the first provided by interaction of the T-cell receptor (TCR) with a peptide presented by an MHC molecule, and the second through co-stimulatory molecules on antigen-presenting cells.

CBL-B plays an essential role in the negative regulation of T-cell activation by regulating the activity of the TCR through substrate proteins that require a costimulatory signal to mount a productive immune response upon TCR engagement.

Studies have found that CBL-B deficient T cells display lower thresholds for activation by antigen recognition receptors and co-stimulatory molecules such as CD28.

For example, loss of CBL-B in T cells results in T cells that can be activated upon TCR engagement without co-stimulation by CD28.

Importantly, our CBL-B inhibitors do not appear to activate T cells in the absence of TCR engagement.

Such CBL-B deficient T cells are resistant to T-cell anergy, a tolerance mechanism in which T cells are functionally inactivated and T-cell proliferation is greatly impaired.

Notably, CBL-B deficient T cells show increased rates of proliferation as well as elevated cytokine secretion including IL-2.

The increased secretion of IL-2 is of particular importance in the optimization and development of our CBL-B inhibitors, serves as a key cellular biomarker for measuring successful T-cell activation and is a known therapeutic cytokine in oncology.

We believe that our oral, small molecule CBL-B inhibitor, NX-1607, has several potential immunotherapy applications through enhancing T-cell mediated anti-tumor activity by lowering the activation threshold of T cells in a suppressive tumor microenvironment where CBL-B plays a key role in the downregulation of T cells.

Importantly, NX-1607 does not appear to activate T cells in the absence of TCR engagement.

We are studying NX-1607 in a Phase 1a dose escalation trial in multiple solid tumors and lymphoma.

Solid tumors represent the vast majority of human cancers.

Various immunotherapy strategies have been developed in order to increase the efficiency of anti-tumor immune response, including the use of antibody checkpoint inhibitors such as anti-PD-1, anti-PD-L1 and anti-CTLA-4, which block the “brakes” of immune response.

These immune-stimulating antibodies have a more favorable clinical outcome than traditional treatment modalities on a growing list of tumor types.

However, most patients fail to respond or experience only transient responses.

Preclinical development of CBL-B inhibitors

We have developed a series of potent small molecule inhibitors of CBL-B activity that have demonstrated biochemical activity and effects in vitro on human immune cells as well as in mouse tumor models.

Consistent with studies cited above, CBL-B inhibitors enhanced ex vivo T-cell activation as measured by induction of IL-2, a key cytokine required for immune cell activation and proliferation.

Induction of IL-2 secretion occurs at low nanomolar concentrations in primary human and mouse T cells stimulated with anti-CD3/anti-CD28 antibodies or anti-CD3 antibodies alone.

As illustrated below, we demonstrated several fold increases in IL-2 production in tandem with increasing biochemical activity of our CBL-B inhibitors.

In addition, certain of our CBL-B inhibitors reduced anergy and exhaustion in an ex vivo model of T-cell exhaustion using human donor T cells and further, this effect was additive to that achieved with an anti-PD-1 antibody.

Based on our findings to date, we believe that CBL-B inhibitors may induce an immune cell localized IL-2 secretion that in combination with other immune activation effects will enhance anti-tumor responses.

The precursor compounds shown in the graphs below led to the optimization and selection of NX-1607 as a development candidate.

NX-1607, an oral CBL-B inhibitor for immuno-oncology

NX-1607 is an investigational, orally bioavailable, potent inhibitor of CBL-B.

Background on CBL-B as a regulator of T-cell activation

T cells are central to the cell-mediated adaptive immune response.

Their activation, expansion, and function require carefully balanced positive and negative feedback mechanisms at each step.

Multiple factors impair effective anti-tumor responses, including insufficient tumor antigen expression, defective antigen presentation, and the presence of inhibitory signals (e.g., immune checkpoints, suppressive factors, or T-cell exhaustion).

CBL-B is an E3 ubiquitin ligase expressed in multiple immune cell lineages, where it negatively regulates T-cell activation and limits the function of NK cells, B cells, and dendritic cells.

By promoting T-cell exhaustion, anergy, and cell death, CBL-B downregulates immune responses.

CBL-B is highly expressed in human CD4+ and CD8+ T cells, with its expression tightly regulated by co-stimulatory (CD28) and inhibitory (CTLA-4) signals.

Typically, T cells require two signals for activation:

(1) TCR recognition of antigen–MHC complexes and (2) co-stimulatory signals.

CBL-B influences the TCR pathway by requiring adequate co-stimulation for a full immune response.

Accordingly, CBL-B–deficient T cells have reduced activation thresholds and resist T-cell anergy, displaying higher proliferation rates and elevated cytokine production (e.g., IL-2).

However, inhibiting CBL-B alone does not activate T cells in the absence of TCR engagement, highlighting its potential as a therapeutic target to enhance anti-tumor immunity without indiscriminate T-cell activation.

Mechanism of action of NX-1607, an orally bioavailable small molecule inhibitor of the E3 ligase CBL-B

An Oral CBL-B Inhibitor for Immuno-Oncology

NX-1607 is an investigational, orally bioavailable, and potent CBL-B inhibitor that enhances T-cell-mediated anti-tumor responses.

In vitro studies demonstrated that NX-1607 treatment resulted in a dose-dependent increase in T-cell activation in TCR-stimulated primary human T cells in the presence and, to a lesser extent, in the absence of CD28 co-stimulation, a potential advantage in a suppressive tumor microenvironment.

In vitro , NX-1607 has been demonstrated to increase T-cell activation in primary human T cells in the absence of co-stimulation with CD3 and CD28, a potential advantage in a suppressive tumor microenvironment.

In vivo , oral administration of NX-1607 in mice has demonstrated notable tumor growth inhibition in a tumor model as illustrated in the figure below on the left.

The tumor growth inhibition with oral administration of NX-1607 recapitulates the genetic experiment in mice with a ligase-inactive version of CBL-B which also shows tumor growth inhibition as illustrated in the figure below on the right.

The in vivo effects of orally administered NX-1607 were further evaluated as a single agent in several mouse models of cancer.

In the experiments shown in the figure below on the left, oral treatment with NX-1607 at a dose of 30 mg/kg (blue circles) significantly reduced the size of tumors measured at day 25 compared to vehicle treated animals (black squares) in this colorectal cancer model.

In the figure below in the middle, oral treatment with NX-1607 significantly increased survival in this neoadjuvant model of metastatic triple-negative breast cancer in which treatment was initiated just prior to surgical primary tumor resection.

NX-1607 does not appear to activate T cells in the absence of TCR engagement.

The in vivo effects of orally administered NX-1607 were evaluated as a single agent in several mouse models of cancer.

In the experiments shown in the figure below on the left, oral treatment with NX-1607 significantly increased survival in this neoadjuvant model of metastatic triple-negative breast cancer in which treatment was initiated just prior to surgical primary tumor resection (shaded area indicates dosing period).

Without further treatment, all mice in the vehicle group (black line) died by day 60 as a result of disseminated tumor metastases in the lung, liver and brain.

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In the left and middle panels, the combination of oral NX-1607 plus anti-PD-1 (light blue lines) demonstrated increased survival in two separate colorectal cancer models compared with animals treated with either NX-1607 alone (blue line), anti-PD-1 alone (red line) or vehicle (black line).

In the panel on the right, the activity of oral NX-1607, anti-PD-1 and the combination of NX-1607 and anti-PD-1 were tested in a model of metastatic triple-negative breast cancer.

Both single agent NX-1607 (blue triangles) and single agent anti-PD-1 (red circles) reduced the number of lung metastases at day 28 compared with the vehicle group (black squares), but the combination of NX-1607 and anti-PD-1 (light blue diamonds) was superior to either single agent.

Clinical development of NX-1607

We are studying the pharmacology, safety and clinical activity of single-agent NX-1607 and the combination of NX-1607 with taxane chemotherapy in multiple solid tumor indications and lymphoma.

We are studying the pharmacology, safety and clinical activity of single-agent NX-1607 and the combination of NX-1607 with taxane chemotherapy in multiple solid tumor indications.

The solid tumors selected for this initial assessment include three different immune phenotypes:

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As illustrated in the diagram below, we are conducting a Phase 1a/1b dose-escalation and cohort expansion study of NX-1607 in patients with relapsed or refractory solid tumors and lymphoma.

We are currently enrolling patients in the Phase 1a dose escalation portion of the monotherapy trial.

Our DELigase platform

Our approach leverages the specificity of E3 ligases and the natural function of the UPS to regulate the cellular proteome for therapeutic effect.

Development of therapies that modulate E3 ligases has been historically limited by the inherent difficulties in building biochemical and cellular assays relevant for measuring E3 ligase function, as well as by the relative lack of mechanistic understanding of this critical class of proteins.

Through our focused efforts and investment over the past several years, we have developed proprietary tools, in-depth knowledge and expertise relating to E3 ligases as targets for drug discovery.

In addition, we have assembled a team that has extensive experience applying DEL discovery technologies to a wide variety of proteins including targets previously considered undruggable.

Together, these capabilities and insights have allowed us to develop a powerful platform technology called DELigase to identify and advance novel drug candidates that either selectively increase or decrease protein levels within the cell.

Our DELigase platform combines our proprietary DELs and E3 ligase expertise to empower efficient drug discovery.

DEL technology is well suited to finding new binders for targets thought to be undruggable, which include the vast majority of proteins encoded in the human genome including E3 ligases.

We are currently enrolling patients in the Phase 1a dose escalation portion of the monotherapy trial, which includes assessment of both once daily (QD) and twice daily (BID) dosing.

NX-1607 Phase 1 Clinical Study Design

Interim data from patients treated at 5, 15, 25, and 50 mg QD show linear pharmacokinetics (half-life of four to nine hours), dose-proportional exposure, and no apparent accumulation as indicated in figure below.

Interim PK results suggest linear PK (Cycle 1 Day 1)

Biomarker Strategy:

Proximal Markers of CBL-B Inhibition

Nurix identified multiple proximal biomarkers of CBL-B inhibition that correlate with anti-tumor activity in syngeneic models.

Using flow cytometry-based phosphorylation profiling and mass spectrometry–based ubiquitination assays, phosphorylated hematopoietic lineage cell-specific protein 1 (pHS1) emerged as a robust indicator of CBL-B inhibition in whole blood.

Pharmacodynamic analyses in the Phase 1a NX-1607-101 trial (below figure) shows maximal pharmacodynamic profiles in patients treated with 5 to 60 mg of total daily dose of NX-1607, either once daily (QD) or twice daily (BID).

Whole blood was collected at pre- and post-dosing timepoints in TruCulture tubes containing no stimulant (Null) or anti-CD3/CD28 (CD3/CD28).

Collectively, these findings demonstrate the dose-dependent pharmacodynamic activity of NX-1607, providing robust evidence of target engagement and aligning with preclinical data supporting its potential efficacy in patients.

Interim PD results show dose-proportionate increases of proximal biomarker pHS1, which correspond with levels associated with potent anti-tumor activity in mouse models

We are also exploring step-up dosing and the use of anti-emetic prophylaxis medication to achieve target drug levels and minimize potential gastrointestinal tolerability issues.

Our DEL-AI Platform and Research Engine

In disease settings where existing treatments are limited by suboptimal efficacy, safety, or rapid mutational resistance, or in settings that lack treatment options because the relevant disease drivers are not druggable by conventional means, we believe targeted protein degradation represents a promising treatment paradigm with the potential to greatly expand the number of pharmaceutically tractable biological disease targets and thereby significantly improve patient care.

Early disclosures from an ever-increasing number of TPD clinical trials highlight the broad therapeutic potential of harnessing E3 ligases to promote targeted protein degradation of both established and unprecedented therapeutic targets.

Using our DEL-AI research engine, we have identified many novel small molecule starting points and have progressed their development into differentiated therapies for patients lacking treatment options.

Leveraging the wealth of chemical information that we have generated against hundreds of disease targets and E3 ligase proteins using our customized collection of 5 billion unique DEL compounds along with the knowledge we have accumulated by employing empirical degrader discovery workflows, we have constructed a powerful suite of machine learning models and tools that can enable us to predict proprietary binders for virtually any disease-relevant protein, including challenging targets like E3 ligases and transcription factors, and rapidly translate those binders into effective degrader drugs for a growing set of high value protein targets and target families.

Our DEL-AI research engine is scalable and disease/target agnostic, providing us with the ability to support not only our wholly owned pipeline but also current and potential future discovery partnerships.

Fundamental premise of Nurix’s drug discovery:

proteins as targets in treating disease

Each cell type within the body is comprised of proteins that define its biochemistry and biological function.

When proteins are expressed and regulated correctly, the health of each individual cell as well as the body as a whole is maintained.

However, disease can occur when normal cellular processes are dysregulated as a result of changes in protein structure, function, expression levels or pathway regulation.

Factors such as genetic mutations, infection, exposure to toxins, diet and behavior can lead to dysregulation of cellular processes and, if unchecked, a disease process.

The traditional approach to discovering treatments for disease has involved the development of small molecule drugs that bind to a protein’s surface and modulate its activity.

These “druggable” proteins contain distinct structural features called active sites that mediate protein function which can be exploited when identifying and optimizing compounds that disrupt protein activity.

However, the vast majority of the body’s proteins do not have distinct active sites that can be targeted using traditional discovery methods.

In addition, many existing small molecule drugs fail to fully block protein and pathway function, leading to incomplete disease resolution or rapid drug resistance.

Other modalities, including antibody- and protein-based therapies, genetic medicines and cell therapies, have emerged to attempt to address these issues but are still limited by their modes of delivery, their scalability and their therapeutic applications.

Harnessing the activity of E3 ligases to create a new treatment modality

Normal cellular physiology requires highly orchestrated and regulated processes that operate at the level of individual proteins.

The ability of proteins to respond to stimuli quickly and in a coordinated fashion requires protein function to be readily controllable.

One of the most exquisitely ordered biochemical systems governing cellular protein activity is the ubiquitin proteasome system (UPS).

A key class of enzymes within the UPS are E3 ligases which mediate this process with a high degree of specificity by recognizing individual proteins and catalyzing the attachment of ubiquitin protein tags to their surface.

Proteins marked with chains of ubiquitin are then shuttled to the proteasome for degradation and removal from the cell.

In addition to protein degradation, E3 ligases also mediate other functions such as protein localization, receptor internalization, protein signaling and protein quality control.

There are over 600 E3 ligases encoded within the human genome, representing more than 5% of genes.

Controlling protein levels through small molecule therapeutics targeting E3 ligases

Advances in our understanding of the UPS suggest broad potential for the development of new therapies that co-opt E3 ligases in the context of diseases such as cancer and autoimmune disorders.

An example are the so-called immunomodulatory drugs, Revlimid (lenalidomide) and Pomalyst (pomalidomide), which are approved cancer drugs.

These drugs exert their therapeutic effects by binding to the E3 ligase cereblon and redirecting its activity toward proteins it would not normally degrade, known as neosubstrates, such as Ikaros and Aiolos (also known as IKZF1 and IKZF3), transcription factors regulating immune cell function.

Elucidation of this mechanism led to the recognition that pharmacological control of E3 ligase activity could more generally represent a promising new paradigm for small molecule drug action.

This idea has since translated into the development of a growing number of clinical stage targeted protein degraders, which we believe have significant therapeutic potential.

In addition, we believe the largely unexplored area of inhibiting E3 ligases directly to modulate the levels of their native substrate proteins and potentially enhance pathway signaling may also represent a promising therapeutic approach.

• Harnessing E3 ligases to degrade pharmaceutically relevant proteins.

Targeted protein degradation harnesses the natural activity of ligases to target novel neosubstrates, thereby removing specific proteins from the cell.

Targeted protein degradation is accomplished by using a small molecule capable of creating a potent interaction between an E3 ligase and a Protein of Interest (POI) such that the E3 ligase can covalently label the POI with a ubiquitin chain, the cellular signal for proteasome-mediated destruction.

Unlike traditional small molecule inhibition which requires prolonged active site occupancy, targeted protein degradation requires only a brief interaction with a POI, through event-driven pharmacology, allowing one degrader molecule to induce the degradation of hundreds to thousands of copies of the protein target in a catalytic fashion, thereby enabling complete elimination of a protein target and all of its associated functionality.

Further, since the effect is mediated through binding rather than through enzymatic inhibition, proteins lacking enzymatic activity are targetable, greatly expanding the spectrum of both proteins and diseases amenable to small molecule therapeutic intervention .

Some of the key advantages of targeted protein degradation over existing modalities are:

• Degraders can eliminate all of a protein’s functionality.

Removing a protein from the cell by targeting it for proteasomal destruction eliminates all of a protein’s functionality, in contrast to small molecule inhibitors that only block enzymatic function.

• Degraders can access an expanded range of target space.

Conventional small molecule drug development is limited to protein classes, typically enzymes, that exhibit biochemical activities that can be reliably measured and inhibited through the binding of a compound to the target’s active site.

In contrast, proteasomal degradation of a target protein is accomplished by inducing brief proximity of the target protein to an E3 ligase, a process that is agnostic to target structure and function.

• Degraders show differentiated pharmacology.

TPDs act catalytically to eliminate their corresponding target proteins from a cell, requiring just a few degrader molecules to eliminate thousands of protein molecules and forcing the cell to resynthesize the target protein to restore functionality.

This creates a disconnect between degrader pharmacokinetics and degrader pharmacodynamics, greatly reducing the amplitude and duration of drug exposure required to maintain target suppression.

• Degraders are mutationally tolerant.

Minor changes in the amino acid sequence of a target protein, as a consequence of somatic or inhibitor-induced resistance mutations, do not necessarily preclude degrader activity, even in cases where the mutations occur within the degrader binding site.

This is in strong contrast to the propensity of amino acid point mutations to disrupt the in vivo activity and efficacy of inhibitor drugs.

• Degraders can penetrate the CNS.

Small molecule drugs and, most prominently beyond-the-rule-of-five compounds rarely achieve potent CNS exposure or activity.

However, TPDs are increasingly cited for their ability to penetrate and show pharmacology in the CNS, in part due to the minimal plasma exposure required for these catalytic agents to exhibit target coverage.

• Inhibiting E3 ligases to control pathway activation.

By inhibiting the function of E3 ligases it is possible to rapidly increase the levels of specific protein substrates to control biological pathways.

Raising the levels of distinct sets of proteins within a single biological pathway could be a powerful approach to blocking pathological processes and restoring normal physiology.

We believe that co-opting E3 ligase functionality to effect pharmaceutical control of critical disease-associated proteins represents a powerful therapeutic frontier that retains the favorable attributes of small molecule treatment modalities while addressing some major limitations.

In addition to the points above, we believe other key differentiating attributes of our treatment modality include:

• Expansive therapeutic potential .

The UPS and its associated E3 ligases function across the majority of cell types and organ systems, making it possible to modulate virtually any protein of interest for a wide range of diseases.

• Deliverable and tunable .

• Ease of manufacturing .

Development and manufacturing of small molecules utilizes established, cost-efficient processes that are readily scalable.

Key attributes and applications of our DEL-AI platform and research engine

Our approach to pharmaceutical development relies on harnessing the innate specificity and the natural function of the UPS to regulate the cellular proteome for therapeutic effect.

Until recently, development of therapies that co-opt E3 ligases and other UPS effectors has been limited by the lack of available chemical matter for this class of proteins, as well as by the relative lack of biochemical, biological and mechanistic understanding of these critical protein families.

Through our focused efforts and investment over the past several years, we have developed proprietary tools, in-depth knowledge and a wealth of chemical matter to enable the broader use of E3 ligases in drug discovery.

In addition, we have further expanded our reach by leveraging our E3 ligase knowledge base using purpose-built machine learning to prospectively access even more chemical matter capable of engaging this highly sought-after therapeutic target class.

Significant investments in E3 ligase protein sciences and DEL methodology developments along with a liberal application of our DEL resource across hundreds of proprietary and partnered POIs has allowed us to generate large, high-quality datasets predominantly representing target classes relevant to protein degradation.

Using advanced machine learning techniques trained on our DEL data compendium, we have developed powerful tools that can prospectively predict ligands to an arbitrarily large number of protein targets.

This technology has greatly broadened the set of proteins ligandable by our methodologies, both in scope and in scale.

As shown below, these capabilities and insights have allowed us to develop DEL-AI, a powerful technology to identify and advance novel drug candidates.

Our DEL-AI research engine is a fully integrated, machine-learning powered drug discovery engine that leverages large empirical DEL and TPD datasets to write the rulebook of degrader drug design.

DEL technology taps enormous chemical space to overcome “druggability” limits

Our DEL collection comprises several billion compounds whereas typical screening collections contain less than a few million.

This increased scale provides the necessary chemical diversity to identify chemical starting points for more challenging protein targets that have been considered undruggable by other approaches.

DEL technology evaluates each library compound simultaneously in a single experiment, enabling a more accurate assessment of compound function.

In addition, because DEL drug discovery is performed by measuring compound binding rather than biochemical activity it allows inclusion of proteins for which biochemical assays are lacking or not feasible.

Further, the relative ease with which binding screens can be performed and interpreted provides sufficient flexibility to allow evaluation of structurally complicated proteins like E3 ligases, which display distinct conformations and activity states and are often part of large multi-protein complexes.

Lastly, a chemical linker attaches each DEL compound to a strand of DNA, which functions as a structure barcode allowing screening hits to be easily identified.

DEL’s built in chemical linker is also an advantage in the context of identifying bifunctional degraders, as it allows the discovery of compounds that can effectively bind proteins when linked to a partner molecule.

Our DELigase platform was designed for E3 ligase discovery

Our integrated DELigase platform relies on proprietary DELs we have specifically engineered to identify and select binders against a diverse group of target protein classes, including some considered to be undruggable, as well as binders to E3 ligases.

Key features of our DELigase platform include:

Our DEL compound collection comprises several billion individually DNA-labeled drug-like small molecules in contrast to conventional screening collections which contain less than a few million untagged compounds.

This increased scale and traceability provides the necessary chemical diversity to identify chemical starting points for a broad set of biological targets, including many of the more challenging protein families that have been considered undruggable by other approaches.

DEL technology evaluates each library compound simultaneously in a single experiment, enabling a more accurate biophysical assessment of compound behavior which translates into higher fidelity hit finding.

In addition, because DEL drug discovery is performed by measuring compound binding rather than biochemical activity, it can be applied to almost any protein, most notably to proteins considered intractable because enzymatic screening assays are lacking or not feasible.

Further, the relative ease with which binding screens can be performed and interpreted provides sufficient flexibility to allow evaluation of structurally complicated proteins like transcription factors and E3 ligases, which display distinct conformations and activity states that are rarely accessible in conventional biochemical screening assays.

Lastly, a chemical linker attaches each DEL compound to a strand of DNA that functions as a barcode defining its unique chemical structure and allowing drug starting points to be easily identified through DNA sequencing.

DEL’s built-in chemical linker is also an advantage in the context of TPD design, as it biases toward the discovery of binders that tolerate linker attachment, a critical prerequisite for bifunctional degrader construction.

Our DEL technology was designed to identify ligands to drug the undrugged

Our methods rely on proprietary DELs we have specifically engineered to enable access to selective binders for a diverse group of target protein classes, including transcription factors, E3 ligases, disease-specific mutant proteins including fusions, as well as many other targets that have not previously been drugged.

Key features of our DEL platform include:

• Custom-synthesized DELs.

Our custom-synthesized chemical scaffolds impart desirable, drug-like chemical properties, like solubility, into each library compound in a manner that cannot be achieved when building DEL collections solely from commercial inputs.

The three-dimensional design of the proprietary scaffolds allows our library compounds to complement the surface of the target proteins, making them ideal for binding targets classically considered undruggable, such as E3 ligases.

For 75% of the undruggable targets screened by us, the scaffold libraries have been the sole source of hits from our collection.

Our collection of over 5 billion compounds also enables us to find diverse hits for classical targets and contains a sizable subset of covalent compounds, which have been shown as another effective way to bind E3 ligases.

Covalent compounds have begun to show promise in augmenting performance of targeted protein degraders, suggesting that our covalent DELs may have additional utility for Targeted Protein Modulation.

Design of the Nurix DEL Collection

Our libraries have been designed to incorporate hundreds of custom-synthesized chemical scaffolds that impart desirable, drug-like chemical properties like solubility into each library compound in a manner that cannot be achieved when building DEL collections solely from commercial inputs.

The three-dimensional design of our proprietary, SP3-enriched scaffolds allows our DEL compounds to better-complement the shallow surfaces of these more difficult to drug protein types, making them ideal for hit finding screens directed against targets that have proven to be undruggable by conventional approaches.

For 75% of the undruggable targets screened to date, our scaffold libraries have provided the sole source of progressible hits.

Often these binders interact with previously unappreciated binding sites on the surface of the target protein, or they interact with rare or unexpected conformational states, offering new ways to potentially target disease processes specifically.

Most importantly, using our collection of over 5 billion DNA-linked and readily traceable compounds in thousands of screen reactions has allowed us to amass an enormous compendium of highly ordered binding data that is directly applicable to machine learning.

Design and Differentiation of the Nurix DEL Collection

• Many screens, one protein target.

Protein targets have many potentially ligandable surfaces and can also exist in multiple conformation states.

Our approach uses comprehensive parallel screening campaigns to interrogate numerous states and surfaces of the target protein by combining multiple protein constructs with a variety of known substrates, binders, or cofactors in empirically replicated screening assays .

• Proprietary data analysis and hit confirmation technologies .

We have built a suite of custom analytical tools for interpretation and prioritization of our DEL binder outputs, which routinely contain thousands of productive hits.

By leveraging data collected from hundreds of DEL screens, we are able to rapidly eliminate background signal and reveal the most promising target-specific ligands.

We have also developed machine learning and high throughput methods for nanoscale hit resynthesis and affinity selection mass spectroscopy that allow a more comprehensive and industrialized process for finding the best chemical starting points for future pipeline programs.

Leveraging the Nurix DEL Database for clear classification of enriched DEL ligands

• Many screens, one protein target .

E3 ligases can exist in multiple potential conformation states.

Our approach uses comprehensive parallel screening campaigns to interrogate numerous states and surfaces of the target protein.

An illustration of how we probe the surface of an E3 ligase by DEL screening is depicted in the graphic below.

DELs allow access to a spectrum of binders across the protein surface, some of which inhibit protein function.

By leveraging data collected from thousands of DEL screens, we can rapidly recognize and eliminate background signal and reveal the most promising target-specific ligands.

We have also developed high throughput methods for nanoscale hit resynthesis and affinity selection mass spectroscopy that allow a more comprehensive and industrialized process for rapidly confirming the best chemical starting points for future pipeline programs.

Our ligase know-how enables us to address diverse therapeutic applications

We have expanded the universe of E3 ligases available for therapeutic manipulation from the two predominantly used in the field, cereblon and VHL, by screening more than 100 E3 ligases to date to identify novel harnesses or molecular glues for use in TPD.

We have carefully selected these E3 ligases based on their potential degradative function, level of processivity, lack of regulation, and desirable cell or tissue expression pattern.

We consider the unique biological function of each ligase and the therapeutic requirements of the disease state when prioritizing discovery workflows.

E3 ligases that are required for cancer cell survival are also of high interest for cancer indications to reduce the risk of intrinsic resistance to degrader action.

We continue to actively grow our collection of chemical matter for E3 ligases to better tailor our TPD product profiles to our expanding range of therapeutic areas.

Our industrialized degrader design, synthesis and testing workflows are scaled for empirical learning

• Rapid automated chemistry.

Our state-of-the-art automated chemistry robotic suite allows for rapid synthesis of both binders and fully assembled degrader molecules.

This automation enables us to sample unprecedented chemical space and allows for faster design test cycles which accelerates drug discovery projects.

Our advanced automated chemistry robotic suite allows for rapid synthesis of both binders and fully assembled degrader molecules.

Application of on-resin chemistry methods allows us to achieve high reaction yields with fidelity such that we can forego purification steps and move rapidly from synthesis to cell-based testing of hundreds of degrader analogs per design cycle.

This automation enables us to sample unprecedented chemical space and allows for faster design-make-test cycles, accelerating drug discovery projects

• High throughput proteomics.

A key advantage of the targeted protein degradation modality in contrast to traditional small molecule inhibitor development is that the precision and selectivity of protein degradation can be measured globally in any cell type to define on- and off-target drug behavior discretely at a cellular level, something not possible for nearly any other pharmaceutical modality.

This proteome-wide data is ideally suited to inform machine learning models.

• Early and scaled in vivo pharmacokinetics and pharmacodynamics of bifunctional degraders.

Our degrader optimization workflows employ high throughput in vivo screens for oral bioavailability which has enabled us to empirically determine the complex spectrum of property combinations that correlate with potent pharmacodynamic activity.

• Structure based drug design and ternary complex modeling.

Ternary complex stability, optimal ligase-to-target protein orientation, and minimal degrader molecular weight are core tenets of any TPD discovery campaign.

Our workflows prioritize the empirical determination of a variety of biophysical properties and behaviors, including protein x-ray structures, ternary complex x-ray or cryo-EM structures, and an array of protein-protein and ligand-protein modeling exercises that deliver valuable datasets for informing TPD design.

Cohesive integration of advanced machine learning to every aspect of our discovery process

Targeted protein degradation has unlocked novel avenues for delivering effective therapies, leveraging unprecedented mechanisms of action to eliminate disease-causing proteins.

These molecules involve new biology and new chemistry, necessitating extensive research along many dimensions of our drug candidates to achieve desirable profiles for our TPDs.

To navigate this new paradigm in drug discovery, we have taken an empirical approach.

We have invested heavily in high-throughput data generation workflows such as our 5 billion compound DEL resource as well as our automated chemistry and assay platforms.

As a result, we have amassed one of the industry’s largest datasets singularly generated from experiments relevant to discovery, validation and optimization of targeted protein degradation.

Our research engine harnesses our expansive, empirical data streams to write the rulebook for TPD drug design.

Through the integration of high-quality data emerging from our discovery and development workflows and application of deep learning and generative design, our powerful research engine is delivering a rapidly growing portfolio of early leads and optimized drug candidates.

• DEL Foundation.

A foundation machine learning model built on our high-quality and high-volume DEL datasets which enables prospective binder identification for diverse POI and Ligase targets.

• Degrader activity .

Program-specific models trained on our proprietary degrader activity datasets to better understand and optimize degrader MOA.

• Multiparameter property optimization.

A suite of models tuned to predict a range of important molecular and pharmacokinetic properties in the unique chemical space occupied by TPD molecules.

• Generative molecular design.

An integrated infrastructure leveraging the range of DEL Foundation, Degrader Activity, and Property Optimization models within an advanced generative machine learning framework.

• Harnessing our data generation pipelines with machine learning.

Our investment in scalable science has created large data streams stemming from our DEL, automated chemistry, and high-throughput experimental platforms.

Our internal machine learning team leverages these data in developing models to enable property prediction of our targeted degraders, to support small molecule and TPD lead optimization efforts and to enhance the data analysis and lead ID workflows of our DEL platform.

Our DELigase discovery platform enables us to address multiple therapeutic applications

We have expanded the universe of E3 ligases available for therapeutic manipulation from the two predominantly used in the field, cereblon and VHL, by screening over 60 additional E3 ligases to date.

We have carefully selected these E3 ligases for use in drug discovery across our three core areas of therapeutic expertise:

oncology, immuno-oncology and immune disorders.

We consider the unique biological function of each ligase and the therapeutic requirements of the disease state for inhibitor programs.

For ligases that direct targeted protein degradation, we take into account the biochemical specificity of the E3 ligase as well as tissue specificity of action and cellular localization of the target protein.

E3 ligases that are required for cancer cell survival are also of high interest for cancer indications to reduce the risk of intrinsic resistance to degrader action.

We are growing our set of E3 ligases for use in our DELigase platform tailored to our core therapeutic areas.

DELigase for E3 ligase harnesses

We apply our platform to utilize the ubiquitination function of E3 ligases for targeted protein degradation.

Our DELigase platform enables us to identify binders to E3 ligases, which we refer to as harnesses, as well as binders to degradation targets.

We use these molecular starting points to design compounds using a modular approach that connects an E3 ligase harness to a target protein binder with a linker.

We refer to these bifunctional molecules as targeted protein degraders, which function by bringing the E3 ligase into proximity of the target protein to catalyzing its ubiquitination and degradation.

DELigase for E3 ligase inhibitors

By inhibiting the function of E3 ligases, it is possible to rapidly increase specific protein levels to control biological pathways.

Increasing the levels of distinct sets of proteins could be a powerful approach to blocking pathological processes and restoring normal physiology.

Our DELigase platform enables the identification of inhibitors through parallel screening of distinct E3 ligase activity states using chemical matter tailored specifically for binding to E3 ligases.

Our substantial expertise in E3 ligase biochemistry and biology has allowed us to identify and develop potent inhibitors of E3 ligases that play pivotal roles in T-cell signaling and immune cell function.

Drug candidate identification and selection process

We employ a series of processes and studies from target validation to preclinical development for selection of the appropriate candidate for further development.

We have invested in an integrated drug development infrastructure that enables us to perform every step of the drug discovery and early preclinical development process within our research facility.

Each of our primary areas of core expertise and technology are highlighted in the below illustration.

Our integrated drug discovery and development system and core technical expertise

As a result, Nurix has amassed one of the industry’s largest datasets singularly generated from experiments relevant to targeted protein degradation.

Through the integration of this data spanning the range of our degrader development activities with deep learning and generative design, our researchers leverage our machine learning platform to identify and deliver novel, optimized compounds at any stage along the research pipeline.

Our DAC platform can drive the discovery of cell-specific targeted therapies with the potential for an increased therapeutic windows

Antibody drug conjugates (ADCs) are a rapidly growing modality in targeted therapy.

Traditional ADCs combine the selectivity of monoclonal antibodies with the potency of broadly cytotoxic payloads to effect malignant cell killing.

While this modality can be agnostic to oncogenic mechanism, the pleiotropic effects of these payloads cannot be completely controlled by delivery, and therefore often lead to dose-limiting toxicity.

We believe DACs, formed by conjugating a disease- or cell-type-selective antibody to a targeted protein degrader, can overcome the limitations of traditional ADCs.

First, the degrader payload of a DAC swaps the polypharmacology of a payload toxin, not all of which is required for disease control, with the potent and precise pathway blockade that can be achieved by targeted protein degradation.

Second, since degraders are catalytic, delivery of just a few degrader molecules to any one cell is sufficient to catalyze complete removal of a target protein and provide prolonged pharmacodynamic effect.

Third, the tissue distribution of the degrader target protein and the co-opted E3 ligase afford two additional layers of selectivity to delimit DAC activity beyond what can be achieved through antibody delivery alone, mitigating the common ADC toxicities and providing the potential for superior safety while maintaining ADC-equivalent biological potency.

In comparison, other novel antibody payloads, such as enzyme inhibitors, require high levels of payload delivery to be effective.

An added benefit of the DAC modality is that it expands the repertoire of biological targets and E3 ligases that would make suitable combinations to achieving disease efficacy through TPD.

This added flexibility enables us to further tap the potential of our DEL-AI platform to harvest a larger spectrum of Nurix’s existing chemical matter and know-how.

As a proof-of-concept for the DAC approach, we conjugated one of our potent BTK degraders to B-cell targeting (anti-CD19) and non-targeting (anti-Her2) monoclonal antibodies via a diverse set of chemical linkers leveraging our existing platform capabilities.

The resulting B-cell targeting anti-CD19-BTK DACs, and non-targeting anti-Her2-BTK control conjugates were tested for BTK degradation in CD19+ malignant B cells.

As illustrated in the figure below, we were able to show that only the anti-CD19 DAC (blue) had comparable degradation potency to that of the unconjugated degrader, validating the power and feasibility of antigen-specific antibody-mediated delivery of the DAC approach.

Collaborations and License Agreements

In June 2019, we entered into a global strategic collaboration agreement with Gilead (as subsequently amended, the Gilead Agreement) to discover, develop and commercialize a pipeline of targeted protein degradation drugs for patients with cancer and other challenging diseases using our DELigase platform to identify novel agents that utilize E3 ligases to induce degradation of five specified drug targets.

In June 2019, we entered into a global strategic collaboration agreement with Gilead (as subsequently amended, the Gilead Agreement) to discover, develop and commercialize a pipeline of targeted protein degradation drugs for patients with cancer and other challenging diseases using our DEL-AI platform to identify novel agents that utilize E3 ligases to induce degradation of five specified drug targets.

In August 2019 and September 2022, we entered into the First Amendment and the Second Amendment, respectively, to the Gilead Agreement to clarify certain language of the Gilead Agreement.

In February 2024 and March 2024, as part of the existing collaboration agreement, Gilead elected to extend the five-year initial research term by two years for certain drug targets (Gilead Research Term Extension).

The Gilead Research Term Extension triggered a $15.0 million payment, which we received in the second quarter of fiscal year 2024.

Under the Gilead Agreement, Gilead has the option to license drug candidates directed to up to five targets resulting from the collaboration and is responsible for the clinical development and commercialization of drug candidates resulting from the collaboration.

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The collaboration excludes our current internal protein degradation programs for which we retain all rights, and also excludes our future internal programs, provided that we have distinguished future programs as excluded from the scope of the collaboration.

In March 2023, Gilead exercised the option to exclusively license one target (Gilead License Option Exercise), the first development candidate resulting from the Gilead Agreement.

In March 2023, Gilead exercised its option to exclusively license one target (Gilead License Option Exercise), the first development candidate resulting from the Gilead Agreement.

Pursuant to the Gilead Agreement, we received a license option exercise payment of $20.0 million in April 2023 for the Gilead License Option Exercise.

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Upon signing the Gilead Agreement, Gilead paid us an upfront payment of $45.0 million, plus $3.0 million in additional fees.

In addition, from the signing of the Gilead Agreement to November 30, 2023, we received payments of $47.0 million for research milestones and additional payments and $20.0 million for a license option exercise payment.

In addition, from the signing of the Gilead Agreement to November 30, 2024, we received payments of $47.0 million for research milestones and additional payments, $20.0 million for a license option exercise payment and $15.0 million in research term extension fees.

As of November 30, 2024, we are eligible to receive up to approximately $1.8 billion in total additional payments based on certain additional fees, payments and the successful completion of certain preclinical, clinical, development and sales milestones.

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If Gilead does not exercise an option to license a drug candidate, then the Gilead Agreement will terminate at the end of the last to expire option period.

In December 2019, we entered into a strategic collaboration with Genzyme Corporation, a subsidiary of Sanofi, which became effective in January 2020 (as subsequently expanded and amended, the Sanofi Agreement), to discover, develop and commercialize a pipeline of targeted protein degradation drugs for patients with challenging diseases in multiple therapeutic areas using our DELigase platform to identify small molecules designed to induce degradation of three specified initial drug targets.

In December 2019, we entered into a strategic collaboration with Genzyme Corporation, a subsidiary of Sanofi, which became effective in January 2020 (as subsequently expanded and amended, the Sanofi Agreement), to discover, develop and commercialize a pipeline of targeted protein degradation drugs for patients with challenging diseases in multiple therapeutic areas using our DEL-AI platform to identify small molecules designed to induce degradation of three specified initial drug targets.

In January 2021, as part of the existing Sanofi Agreement, Sanofi paid us $22.0 million to exercise its option to expand the number of targets in the Sanofi Agreement from three to a total of five targets.

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In August 2022 and November 2023, we entered into the Fourth Amendment and Fifth Amendment, respectively, to the Sanofi Agreement to modify the research plan for certain targets.

In March 2024, we entered into the Sixth Amendment to the Sanofi Agreement to extend the research term for the collaboration target STAT6 (signal transducer and activator of transcription 6), a key drug target in type 2 inflammation, by two years.

Under the Sanofi Agreement, Sanofi has exclusive rights and is responsible for the clinical development, commercialization and manufacture of drug candidates resulting from the collaboration while we retain the option to co-develop, co-promote and co-commercialize all drug candidates in the United States directed to up to two targets, one of which must be selected from a list of targets designated at the execution of the Sanofi Agreement or any replacement of such targets, and one of which must be selected from targets identified by Sanofi as part of their January 2021 expansion.

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For those programs that we exercise our option to co-develop, co-promote and co-commercialize, we will be responsible for a portion of the U.S.

development costs, and the parties will split U.S.

development costs, the parties will split U.S.

profits and losses evenly, and we will be eligible to receive royalties on ex-U.S.

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In addition, from the signing of the Sanofi Agreement to November 30, 2024, we received payments of $13.0 million for research milestones.

Additionally, we achieved two research milestones in November 2023 and received payments totaling $4.0 million in January 2024 as a result.

As of November 30, 2023, we are eligible to receive up to approximately $2.5 billion in total additional payments based on certain additional fees, payments and the successful completion of certain research development, regulatory and sales milestones, as well as mid-single digit to low teen percentage tiered royalties on annual net sales of any commercial products that may result from the collaboration, subject to certain reductions and excluding sales in the United States of any products for which we exercise our option to co-develop and co-promote, for which the parties share profits and losses evenly.

As of November 30, 2024, we are eligible to receive up to approximately $1.9 billion in total additional payments based on certain additional fees, payments and the successful completion of certain research development, regulatory and sales milestones.

We are also eligible to receive mid-single digit to low teen percentage tiered royalties on annual net sales of any commercial products that may result from the collaboration, subject to certain reductions and excluding sales in the United States of any products for which we exercise our option to co-develop and co-promote, for which the parties share profits and losses evenly.

Subject to earlier expiration in certain circumstances, the Sanofi Agreement expires on a licensed product-by-licensed product or profit-shared licensed product-by-profit-shared licensed product basis and country-by-country basis upon on the later of (1) the expiration of the last-to-expire patent with a valid claim covering the applicable licensed product in the applicable country, (2) the expiration of any regulatory exclusivity for the applicable licensed product in the applicable country or (3) ten years after the first commercial sale of the applicable licensed product in the applicable country covered by the Sanofi Agreement.

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(now a part of Pfizer Inc.) (the Pfizer Agreement) to develop a suite of targeted protein degraders against multiple targets nominated by Pfizer that are suitable for antibody conjugation.

Pfizer will be responsible for conjugating these degraders to antibodies to make Degrader-Antibody Conjugates (DACs), a new class of medicines for use in cancer treatment, and advancing these DAC drug candidates through preclinical and clinical development and commercialization.

Pfizer will be responsible for conjugating these degraders to antibodies to make DACs, a new class of medicines for use in cancer treatment, and advancing these DAC drug candidates through preclinical and clinical development and commercialization.

Under the Pfizer Agreement, Pfizer has the option to obtain exclusive licenses to develop and commercialize certain degraders, while we retain an option for U.S.

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For the targets nominated by Pfizer under the collaboration, we shall use commercially reasonable efforts to identify, synthesize, characterize and deliver targeted protein degraders that selectively bind to and degrade such targets.

Development of licensed degraders, with the exception of licensed products for which we exercised our profit-share options, will be at Pfizer’s sole cost and expense.

Development of licensed degraders, with the exception of licensed products for which we exercise our profit-share options, will be at Pfizer’s sole cost and expense.

For the profit-share products, the parties will share net profits and net losses and global development costs, and we will be eligible to receive royalty and milestone payments on such optioned products.

Under the terms of the Pfizer Agreement, we received an upfront payment of $60.0 million.

We are eligible to receive up to approximately $3.4 billion in contingent payments based on specified research, development, regulatory and commercial milestones across multiple programs, and are eligible for mid-single to low double digit percentage tiered royalties on future sales.

In addition, from the signing of the Pfizer Agreement to November 30, 2024, we received a payment of $5.0 million in connection with the achievement of a research milestone in May 2024.

We are eligible to receive up to approximately $3.4 billion in contingent payments based on specified research, development, regulatory and commercial milestones across multiple programs.

We are also eligible for mid-single to low double digit percentage tiered royalties on future sales.

Subject to the exceptions described in the Pfizer Agreement, the Pfizer Agreement expires upon the first to occur of (1) the expiration of the last-to-expire option exercise period under the Pfizer Agreement if no such option has been exercised prior to such expiration and (2) the expiration of the last-to-expire royalty term under the Pfizer Agreement.

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While we believe that our technology, development experience, scientific knowledge and intellectual property portfolio provide us with competitive advantages, we face potential competition from many different sources, including major pharmaceutical, specialty pharmaceutical and biotechnology companies, academic institutions, governmental agencies and public and private research institutions that conduct research, seek patent protection and establish collaborative arrangements for research, development, manufacturing, and commercialization.

Not only must we compete with other companies that are focused on protein modulation, but any drug candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

Not only must we compete with other companies that are focused on protein degradation, but any drug candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

Moreover, our industry is characterized by the existence of large numbers of patents and frequent allegations of patent infringement.

Our focus is the discovery and development of innovative small molecules and antibody therapies designed to modulate protein levels, including targeted protein degraders.

Other companies that primarily focus on developing small molecules that degrade target proteins include, but are not limited to, Arvinas, Inc., BioTheryX, Inc., C4 Therapeutics, Inc., Cullgen Inc., Foghorn Therapeutics Inc., Kymera Therapeutics, Inc.

and Monte Rosa Therapeutics.

Our focus is the discovery and development of innovative small molecules and antibody therapies designed to degrade protein levels, including targeted protein degraders.

We are aware of multiple companies that primarily focus on developing small molecules that degrade target proteins.

Drug candidates from our BTK degrader and CBL-B inhibitor programs may face competition from drugs with similar mechanisms of action.

We are aware of clinical-staged BTK degraders currently in development by AbbVie Inc., Accutar Biotechnology, Inc., BeiGene, Ltd, Haisco Pharmaceutical Group Co., Ltd.

and Ubix Therapeutics, Inc.

In addition, we are aware of a clinical-staged CBL-B inhibitor currently in development by HotSpot Therapeutics, Inc.

We are also aware of clinical-staged BTK degraders currently in development by multiple companies, and we are aware of at least once company currently developing a clinical-staged CBL-B inhibitor.

Our lead drug candidates target hematologic cancers and immune-mediated diseases.

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Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.

Our commercial opportunities could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.

Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours, which could result in our competitors establishing a strong market position before we are able to enter the market.

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Our patent portfolio is intended to cover, but is not limited to, our technology platforms, drug candidates and components thereof and their methods of use, and any other inventions that are commercially important to our business.

We also rely on trade secret protection of our confidential information and know-how relating to our proprietary technology, platforms and drug candidates and continuing innovation to develop, strengthen and maintain our position in our DELigase platform and drug candidates.

Trade secrets are difficult to protect and provide us with only limited protection.

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For risks related to our intellectual property, please see “Risk Factors—Risks Related to Our Intellectual Property.”

We believe that we have a strong global intellectual property position and substantial know how and trade secrets relating to our DELigase platform and drug candidates.

As of December 31, 2023, we have five U.S.

We believe that we have a strong global intellectual property position and substantial know how and trade secrets relating to our DEL-AI platform and drug candidates.

As of December 31, 2024, we have 10 U.S.

patents, 26 U.S.

patent applications, one foreign patent and 103 foreign applications that we own, and one U.S.

patent, four pending U.S.

patent applications and 26 foreign patent applications that we co-own with Gilead.

The expected expirations for issued patents and patents that may issue from pending applications covering our clinical candidates are between the years 2039 and 2042 for NX-5948 and NX-2127;

and between 2040 and 2043 for NX-1607.

patent applications, 10 foreign patents and 134 foreign applications that we own, and three U.S.

patents, four pending U.S.

patent applications, one foreign patent and 26 foreign patent applications that we co-own with Gilead.

The expected expirations for issued patents and patents that may issue from pending applications covering our clinical candidates are between the years 2039 and 2044 for NX-5948;

2039 and 2042 for NX-2127;

and 2040 and 2043 for NX-1607.

The term of individual patents depends upon the laws of the countries in which they are obtained.

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requirements may subject a company to a variety of administrative or judicial sanctions, such as FDA refusal to approve pending new drug applications (NDAs) or biologics licensure applications (BLAs), withdrawal of an approval, imposition of a clinical hold, warning or untitled letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement of profits or civil or criminal investigations and penalties brought by the FDA and the Department of Justice (DOJ) or other governmental entities.

Biological or pharmaceutical product development for a new product or certain changes to an approved or licensed product in the United States typically involves preclinical laboratory and animal tests, the submission to the FDA of an investigational new drug application (IND) which must become effective before clinical testing may commence, and adequate and well-controlled clinical trials to establish the safety and effectiveness of a drug, or the safety, purity, or potency of a biological product, for each indication for which FDA approval is sought.

Biological or pharmaceutical product development for a new product or certain changes to an approved or licensed product in the United States typically involves preclinical laboratory and animal tests, the submission to the FDA of an IND which must become effective before clinical testing may commence, and adequate and well-controlled clinical trials to establish the safety and effectiveness of a drug, or the safety, purity, or potency of a biological product, for each indication for which FDA approval is sought.

Satisfaction of FDA pre-market approval and licensure requirements typically takes many years and the actual time required may vary substantially based upon the type, complexity and novelty of the product or disease.

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Approval of medicines in the European Union (EU)

In the EU, companies can apply for marketing authorizations under the centralized procedure to the European Medicines Agency (EMA) or they can submit their application to the competent authorities in the European Economic Area (EEA) Member States via the decentralized procedure, the national procedure, or the mutual recognition procedure.

In the EU, companies can apply for marketing authorizations under the centralized procedure to the EMA or they can submit their application to the competent authorities in the European Economic Area (EEA) Member States via the decentralized procedure, the national procedure, or the mutual recognition procedure.

The centralized procedure is mandatory for certain medicines, such as those produced by biotechnology, orphan medicinal products, advanced therapy medicinal products and those containing a new active substance indicated for the treatment of HIV, AIDS, cancer, neurodegenerative disorders, autoimmune and other immune dysfunctions, viral diseases, or diabetes.

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The marketing authorization granted under the centralized procedure by the EMA will be valid in all EEA Member States.

The maximum timeframe for the evaluation of a marketing authorization application by the EMA is 210 days but can be extended should additional information be required by the EMA’s Committee for Medicinal Products for Human Use (CHMP).

The evaluation of a marketing authorization application by the EMA’s Committee for Medicinal Products for Human Use (CHMP) takes up to 210 “active” days (excluding all “clock stops” for an applicant to address questions by the EMA–there are usually one or two clock stops that last three to six months and one to two months, respectively) but can be extended, should additional information be required by the CHMP.

The European Commission makes the final decision to grant a marketing authorization, which is issued within 67 days of receipt of the EMA’s positive opinion.

An accelerated assessment procedure of 150 days may be implemented for drugs considered to be of major public health interest.

There is also an internal re-examination procedure available in case the applicant disagrees with the CHMP opinion.

Under the mutual recognition procedure, the national marketing authorization holder may submit an application to other EEA Member States.

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Since the UK has left the EU, Great Britain is no longer covered by centralized marketing authorizations.

This is not the case for Northern Ireland as under the Northern Ireland Protocol, centralized marketing authorizations continue to be recognized in Northern Ireland.

This is not the case for Northern Ireland as under the Northern Ireland Protocol, centralized marketing authorizations continued to be recognized in Northern Ireland until December 31, 2024.

Medicines with existing centralized marketing authorizations were automatically converted to Great Britain marketing authorizations on January 1, 2021.

For a period of two years from January 1, 2021, the Medicines and Healthcare Products Regulatory Agency (MHRA), the UK medicines regulator, can rely on a decision taken by the European Commission on the approval of a new marketing authorization in the centralized procedure, in order to more quickly grant a new Great Britain marketing authorization.

A separate application is, however, still required.

The UK government reached a new agreement with the EU, the “Windsor Framework,” which aims to replace the Northern Ireland protocol.

A separate marketing authorization application is required in respect of the UK.

The UK government reached a new agreement with the EU, the “Windsor Framework,” which replaced the Northern Ireland protocol.

According to the Windsor Framework, medicinal products intended for the UK market including Northern Ireland will be authorized by the MHRA and will bear a “UK only” label.

This means that medicinal products placed on the market in Northern Ireland will no longer need to be compliant with EU law.

These new measures will be implemented beginning January 1, 2025.

These new measures have been implemented as of January 1, 2025.

The MHRA has ceased to participate in the assessment of any centralized procedures since January 1, 2021.

Since then, the MHRA has launched the Innovative Licensing and Access Pathway (ILAP), a new accelerated assessment procedure for marketing authorization applications that enables companies to enter the UK market faster.

On January 1, 2024, the MHRA launched an International Recognition Procedure for Great Britain (England, Scotland and Wales) marketing authorization applications whereby the MHRA will, when considering such applications, recognize the approval of medicines by trusted reference regulators in Australia, Canada, Switzerland, Singapore, Japan, United States and EU following its own abbreviated assessment.

This pathway is currently closed, as of November 20, 2024, until March 2025, when it will reopen for applications under a new refreshed pathway.

On January 1, 2024, the MHRA launched an International Recognition Procedure for marketing authorization applications whereby the MHRA will, when considering such applications, take into account the approval of medicines by trusted reference regulators in Australia, Canada, Switzerland, Singapore, Japan, United States and EU into its own abbreviated assessment.

Clinical trials regulation and data sharing in the EU

In the EU, a Clinical Trial Application (CTA) must be submitted for each clinical trial to each Member State’s national competent authority (NCA) and ethics approval must be sought from an independent Ethics Committee.

Once the CTA is approved in accordance with a particular Member State’s requirements, the clinical trial may proceed.

Under the EU Clinical Trials Regulation 536/2014, which has been in effect since January 31, 2022 replacing the EU Clinical Trials Directive 2001/20/EC, suspected unexpected serious adverse reactions to the drug being trialed occurring during the clinical trial must be reported to the NCA and the Ethics Committee of the Member State where they occurred.

In the EU/EEA, all initial clinical trial applications (CTA) must be submitted through the Clinical Trials Information System (CTIS) and ethics approval must be sought from an independent Ethics Committee.

Under the EU Clinical Trials Regulation 536/2014, which has been in effect since January 31, 2022, replacing the EU Clinical Trials Directive 2001/20/EC, suspected unexpected serious adverse reactions to the drug being trialed occurring during the clinical trial must be reported via the EudraVigilance database.

In the EU, Transparency Regulation No 1049/ 2001, EMA Policy 0043, EMA Policy 0070, as well as the Clinical Trials Regulation No 536/2014 set out the obligation for sponsors to make publicly available certain information stemming from clinical studies, whether proactively or in response to third party requests.

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On May 3, 2022, the European Commission published a proposal for a regulation on the European Health Data Space (EHDS), which aims to further enable exchange of electronic health data both for primary use (among national EU healthcare systems for patient care) and secondary use (among private companies and regulators to enable scientific research).

Whilst the regulation is currently under discussions among the EU legislators, the text is expected to be finalized by the end of 2023 and for the EHDS to become reality in 2025.

While the text of the regulation has provisionally been agreed to among the EU legislators, it is expected that the EHDS will be formally adopted by the European Parliament and the European Council and enter into force within 2025.

EHDS will then apply two years after entry into force, with certain provisions becoming applicable within four or six years after entry into force.

This will impose new obligations, but also create opportunities, for entities engaged in health-related research to share and access health data on a scale much larger than what is foreseen under current applicable transparency provisions.

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Pursuant to the Northern Ireland Protocol, the EU pharmaceutical legal framework acquis continues to apply in Northern Ireland and medicines can only be placed in the Northern Ireland market if they comply with EU law.

The UK government reached a new agreement with the EU, the “Windsor Framework,” which aims to replace the Northern Ireland protocol.

The UK government reached a new agreement with the EU, the “Windsor Framework,” which has replaced the Northern Ireland protocol.

According to the Windsor Framework, medicinal products intended for the UK market including Northern Ireland will be authorized by the MHRA and will bear a “UK only” label.

This means that medicinal products placed on the market in Northern Ireland will no longer need to be compliant with EU law.

These new measures will be implemented beginning January 1, 2025.

This means that medicinal products placed on the market in Northern Ireland no longer need to be compliant with EU law.

These new measures have been implemented as of January 1, 2025.

Expedited approval pathways

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As a result, a drug or biological product candidate approved on this basis is subject to rigorous post-marketing compliance requirements, including the completion of Phase 4 or post-approval clinical trials to confirm the effect on the clinical endpoint.

Failure to conduct required post-approval studies, or confirm a clinical benefit during post-marketing studies, would allow the FDA to withdraw the drug or biological product from the market on an expedited basis, and under the Food and Drug Omnibus Reform Act of 2022, the FDA has increased authority to expedite withdrawals.

In addition, all promotional materials for drugs and biological products approved under accelerated regulations are subject to prior review by the FDA.

The EU and UK operate accelerated evaluation and assessment schemes, which include, at EU level, PRIME (PRIority MEdicines) scheme and, at UK level, the Early Access to Medicines Scheme (EAMS), which may be granted in exceptional cases, often when there is unmet medical need for a life-threatening or serious debilitating condition and existing data show a positive benefit/risk balance that means the medicinal product is of a major public health interest.

The EU and UK operate accelerated evaluation and assessment schemes, which include, at EU level, Priority Medicines (PRIME) scheme and, at UK level, the Early Access to Medicines Scheme (EAMS), which may be granted in exceptional cases, often when there is unmet medical need for a life-threatening or serious debilitating condition and existing data show a positive benefit/risk balance that means the medicinal product is of a major public health interest.

The CHMP of the EMA or the MHRA (or other national competent authority) will make this determination on a case-by-case basis and subject to meeting eligibility criteria.

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The ten-year market exclusivity may be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for orphan designation, for example, if the product is sufficiently profitable not to justify the maintenance of market exclusivity.

Conversely, the 10-year exclusivity period can be further extended by two years, when pediatric studies are conducted in accordance with an agreed pediatric investigation plan (PIP) and in completion of all the legal requirements.

It is noted that the general pharmaceutical legislative framework, as well as the framework applicable to orphan and pediatric medicinal products in the EU, is under review.

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The BPCIA also created certain exclusivity periods for biosimilars approved as interchangeable products.

At this juncture, it is unclear whether products deemed “interchangeable” by the FDA will, in fact, be readily substituted by pharmacies, which are governed by state pharmacy law.

The BPCIA is complex and continues to be interpreted and implemented by the FDA.

In addition, there has been discussion of whether Congress should reduce the 12-year reference product exclusivity period.

Other aspects of the BPCIA, some of which may impact the BPCIA exclusivity provisions, have also been the subject of recent litigation.

As a result, the ultimate implementation of the BPCIA is subject to significant uncertainty.

An interchangeable biosimilar product is a biosimilar that, depending on state pharmacy laws, may be substituted for the reference product at the pharmacy without the intervention of the prescribing healthcare professional (similar to how generic drugs are routinely substituted for brand-name drugs).

It is possible that the distinction between a biosimilar and interchangeable could be eliminated in the future;

the FDA in its Fiscal Year 2025 budget proposal for the first time included a request that Congress “eliminate the statutory distinction between the approval standard for biosimilar and interchangeable biosimilar products.”

In the EU and the UK, an abridged procedure is available for the regulatory approval of biosimilars, on the basis of comparability studies to the reference biological medicine to substantiate the safety and efficacy profile of the biosimilar product.

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In December 2021, the EU adopted a new Regulation on Health Technology Assessment which allows Member States to carry out joint clinical assessments and operate joint clinical consultations.

It is expected that the new Regulation will come into effect in 2025.

It is expected that the new Regulation will go into effect in January 2025.

In the UK, NICE is the body in England and Wales, which conducts HTAs and issues guidance on whether a product is considered to be “cost-effective” and therefore recommended for use and reimbursement under the national health service.

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These laws include anti-kickback statutes, false claims statutes and other healthcare laws and regulations.

The federal Anti-Kickback Statute prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving any remuneration, directly or indirectly, in cash or in kind, to induce, or in return for, purchasing, leasing, ordering or arranging for, referring, or recommending the purchase, lease or order of any healthcare item or service that may be reimbursable, in whole or in part, under Medicare, Medicaid, or other federal health care program.

The federal Anti-Kickback Statute is a broad criminal statute that prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving any remuneration, directly or indirectly, in cash or in kind, to induce, or in return for, purchasing, leasing, ordering or arranging for, referring, or recommending the purchase, lease or order of any healthcare item or service that may be reimbursable, in whole or in part, under Medicare, Medicaid, or other federal healthcare programs.

The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (collectively, the ACA) amended the intent element of the federal Anti-Kickback Statute to clarify that a person or entity need not have actual knowledge of the statute or specific intent to violate it in order to commit a violation.

Among others, this statute applies to arrangements between pharmaceutical and biological product manufacturers on the one hand and prescribers, pharmacies, purchasers and formulary managers on the other, including, for example, consulting/speaking arrangements, discount and rebate offers, grants, charitable contributions and patient support offerings.

A conviction for violation of the federal Anti-Kickback Statute can result in criminal fines and/or imprisonment and requires mandatory exclusion from participation in federal health care programs.

Exclusion from the federal healthcare programs may also be imposed if the government determines that an entity has committed acts that are prohibited by the federal Anti-Kickback Statute.

A violation of the federal Anti-Kickback Statute includes, per violation, civil monetary penalties and significant criminal fines under the statute, additional civil penalties and treble damages under the False Claims Act, as discussed in more detail below, possible imprisonment, and mandatory exclusion from participation in the federal healthcare programs, meaning that federal healthcare programs would no longer reimburse (directly or indirectly) for products or services furnished by the excluded entity or individuals.

Although there are a number of statutory exceptions and regulatory safe harbors protecting certain common activities from prosecution or other regulatory sanctions under the law, the exceptions and safe harbors are drawn narrowly and practices that involve remuneration intended to induce prescribing, purchases or recommendations may be subject to scrutiny if they do not qualify for an exception or safe harbor.

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The law also prohibits avoiding, decreasing or concealing an obligation to pay money to the federal government.

The government can bring claims directly or through a civil whistleblower or qui tam action, and potential liability includes mandatory treble damages and significant per claim penalties currently set at $13,946 up to $27,894 per false claim or statement for penalties assessed after January 15, 2024.

Numerous pharmaceutical and other healthcare companies have been prosecuted under these laws for allegedly inflating drug or biological product prices they report to pricing services, which in turn were used by the government to set Medicare and Medicaid reimbursement rates, and for allegedly providing free product to customers with the expectation that the customers would bill federal programs for the product.

Numerous pharmaceutical and other healthcare companies have been investigated under these laws for purportedly, among other things, concealing price concessions in the pricing information submitted to the government for government price reporting purposes, and for allegedly providing free product to customers with the expectation that the customers would bill federal programs for the product.

In addition, certain marketing practices, including off-label promotion, may also violate false claims laws.

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There is also the federal criminal False Claims Act, which is similar to the federal civil False Claims Act and imposes criminal liability on those that make or present a false, fictitious or fraudulent claim to the federal government.

Other federal statutes pertaining to healthcare fraud and abuse include the civil monetary penalties statute, which prohibits, among other things, the offer or payment of remuneration to a Medicaid or Medicare beneficiary that the offeror or payor knows or should know is likely to influence the beneficiary to order or receive a reimbursable item or service from a particular provider, practitioner or supplier (although pharmaceutical and biological product manufacturers are not considered providers, practitioners or suppliers for purposes of this law), and contracting with an individual or entity that the person knows or should know is excluded from participation in a federal health care program.

In addition, federal criminal statutes created by the Health Insurance Portability and Accountability Act of 1996 (HIPAA) prohibit, among other things, knowingly and willfully executing or attempting to execute a scheme to defraud any healthcare benefit program or obtain by means of false or fraudulent pretenses, representations or promises any money or property owned by or under the control of any healthcare benefit program in connection with the delivery of or payment for healthcare benefits, items or services.

Other federal statutes pertaining to healthcare fraud and abuse include the Civil Monetary Penalties Law, which prohibits, among other things, the offer or payment of remuneration to a Medicaid or Medicare beneficiary that the offeror or payor knows or should know is likely to influence the beneficiary to order or receive a reimbursable item or service from a particular provider, practitioner or supplier (although pharmaceutical and biological product manufacturers are not considered providers, practitioners or suppliers for purposes of this law), and contracting with an individual or entity that the person knows or should know is excluded from participation in a federal healthcare program.

In addition, federal criminal statutes created by the Health Insurance Portability and Accountability Act of 1996 (HIPAA) prohibit, among other things, knowingly and willfully executing or attempting to execute a scheme to defraud any healthcare benefit program or obtain by means of false or fraudulent pretenses, representations or promises of any money or property owned by or under the control of any healthcare benefit program in connection with the delivery of or payment for healthcare benefits, items or services.

In addition, HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act (HITECH) and their respective implementing regulations, including the Final Omnibus Rule published on January 25, 2013, imposes obligations on certain healthcare providers, health plans and healthcare clearinghouses, known as covered entities, as well as their business associates that perform certain services involving the storage, use or disclosure of individually identifiable health information, including mandatory contractual terms, requirements to facilitate certain patient rights, requirements to safeguard the privacy, security, and transmission of individually identifiable health information, and requirements to provide notice to affected individuals and regulatory authorities of certain breaches of security of individually identifiable health information.

HITECH increased the civil and criminal penalties that may be imposed against covered entities, business associates and possibly other persons, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorneys’ fees and costs associated with pursuing federal civil actions.

On December 10, 2020, the Office of Civil Rights within the Department of Health and Human Services (HHS) issued proposed revisions to the HIPAA Privacy Rule aimed at reducing regulatory burdens that may exist in discouraging coordination of care and patient access to their health information, among other changes.

On December 10, 2020, the Office of Civil Rights within the U.S.

Department of Health and Human Services (HHS) issued proposed revisions to the HIPAA Privacy Rule aimed at reducing regulatory burdens that may exist in discouraging coordination of care and patient access to their health information, among other changes, which could affect not just covered entities and business associates, but broader entities in the life sciences space.

While a final rule has not yet been issued, if adopted, these proposed changes may require us to update our policies and procedures to comply with the new requirements.

In addition, many state laws govern the privacy and security of health information and other personal information in certain circumstances (such as the California Consumer Privacy Act of 2018, the Virginia Consumer Data Protection Act, and similar state privacy laws in Colorado, Connecticut and Utah, along with health privacy focused laws such as the Washington My Health My Data Act), and these state laws may differ from each other in significant ways and may not have the same effect.

In addition, many state laws govern the privacy and security of health information and other personal information in certain circumstances (such as the California Consumer Privacy Act of 2018, the Virginia Consumer Data Protection Act, and similar state privacy laws in several other states, along with health privacy focused laws such as the Washington My Health My Data Act), and these state laws may differ from each other in significant ways and may not have the same effect.

These laws are rapidly evolving and may impose additional regulatory compliance burden and legal risks on our operations.

Further, pursuant to the ACA, the Centers for Medicare & Medicaid Services (CMS) has promulgated regulations to implement what is commonly known as the federal Physician Payment Sunshine Act, which, among other things, requires manufacturers of prescription drugs and biological products, among others, to collect and report information on certain payments or transfers of value they make to U.S.-licensed physicians, teaching hospitals, physician assistants, nurse practitioners or clinical nurse specialists, certified registered nurse anesthetists, anesthesiologist assistants and certified nurse-midwives, as well as investment interests in the manufacturer held by physicians and their immediate family members.

Further, pursuant to the ACA, the Centers for Medicare & Medicaid Services (CMS) has promulgated regulations to implement what is commonly known as the federal Physician Payment Sunshine Act, which requires applicable manufacturers of covered drugs, devices, biologics, and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, among others, to collect and report information on certain payments or transfers of value they make to U.S.-licensed physicians, teaching hospitals, physician assistants, nurse practitioners or clinical nurse specialists, certified registered nurse anesthetists, anesthesiologist assistants and certified nurse-midwives, as well as investment interests in the manufacturer held by physicians and their immediate family members.

The reports must be submitted on an annual basis, and the reported data is made available in searchable form on a public website.

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Still other states require the posting of information relating to clinical studies and their outcomes.

Some states require the reporting of certain pricing information, including information pertaining to and justifying price increases, or prohibit prescription drug price gouging.

In addition, states such as California, Connecticut, Nevada and Massachusetts require pharmaceutical companies to implement compliance programs and/or marketing codes.

Some states require the reporting of certain pricing information, including information pertaining to and justifying price increases, prohibit prescription drug price gouging, or impose payment caps on certain pharmaceutical products deemed by the state to be “high cost.” In addition, states such as California, Connecticut, Nevada and Massachusetts require pharmaceutical companies to implement compliance programs and/or marketing codes.

Several additional states are considering similar proposals.

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healthcare reform

In the United States there have been, and continue to be, proposals by the federal government, state governments, regulators and third-party payors to control or manage the costs of health care and, more generally, to reform the U.S.

healthcare system.

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On June 17, 2021, the U.S.

Supreme Court dismissed the most recent judicial challenge to the ACA brought by several states who argued that, without the individual mandate, the entire ACA was unconstitutional.

Supreme Court dismissed a judicial challenge to the ACA brought by several states who argued that, without the individual mandate, the entire ACA was unconstitutional.

The Supreme Court’s dismissal of the lawsuit did not specifically rule on the constitutionality of the ACA.

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The American Rescue Plan Act also temporarily increased premium tax credit assistance for individuals eligible for subsidies under the ACA for 2021 and 2022 and removed the 400% federal poverty level limit that otherwise applies for purposes of eligibility to receive premium tax credits.

Most recently, the Inflation Reduction Act of 2022 extended this increased tax credit assistance and removal of the 400% federal poverty limit through 2025.

The Inflation Reduction Act of 2022 (IRA) extended this increased tax credit assistance and removal of the 400% federal poverty limit through 2025.

In the future, there may be additional challenges and/or amendments to the ACA.

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Other legislative changes have been proposed and adopted in the United States since the ACA was enacted to reduce healthcare expenditures.

These changes include the Budget Control Act of 2011, which, among other things, led to aggregate reductions of Medicare payments to providers of up to 2% per fiscal year that started in 2013 and, due to subsequent statutory amendments, will remain in effect through the first six months of the FY 2032 sequestration order unless additional Congressional action is taken, with the exception of a temporary suspension from May 1, 2020 through July 1, 2022 due to the COVID-19 pandemic.

These changes include the Budget Control Act of 2011, which, among other things, led to aggregate reductions of Medicare payments to providers of up to 2% per fiscal year that started in 2013 and, due to subsequent statutory amendments, will remain in effect through the first eight months of the fiscal year 2032 sequestration order unless additional congressional action is taken, with the exception of a temporary suspension, and later a temporary reduction instituted during the COVID-19 pandemic that expired on July 1, 2022.

The American Taxpayer Relief Act of 2012 made other changes, including the reduction of Medicare payments to several types of providers and an increase in the statute of limitations period for the government to recover overpayments to providers from three to five years.

More recently, in August 2022, President Biden signed into law the Inflation Reduction Act of 2022, which implements substantial changes to the Medicare program, including drug pricing reforms and changes to the Medicare Part D benefit design.

Among other reforms, the Inflation Reduction Act of 2022 imposes inflation rebates on drug and biological product manufacturers for products reimbursed under Medicare Parts B and D if the prices of those products increase faster than inflation beginning in 2023;

Additionally, in August 2022, President Biden signed into law the IRA, which implements substantial changes to the Medicare program, including drug pricing reforms and changes to the Medicare Part D benefit design.

Among other reforms, the IRA imposes inflation rebates on drug and biological product manufacturers for products reimbursed under Medicare Parts B and D if the prices of those products increase faster than inflation beginning in 2023;

implements changes to the Medicare Part D benefit that, beginning in 2025, will cap benefit annual out-of-pocket spending at $2,000, with new discount obligations for pharmaceutical manufacturers;

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CMS has also taken steps to implement the IRA, including:

on June 30, 2023, issuing guidance detailing the requirements and parameters of the first round of price negotiations, to take place during 2023 and 2024, for products subject to the “maximum fair price” provision that would become effective in 2026;

on August 29, 2023, releasing the initial list of ten drugs subject to price negotiations;

on November 17, 2023, releasing guidance outlining the methodology for identifying certain manufacturers eligible to participate in a phase-in period where discounts on applicable products will be lower than those required by the Medicare Part D Manufacturer Discount Program;

on August 15, 2024 releasing the negotiated maximum prices for such drugs that will be effective beginning in 2026;

on October 2, 2024, releasing final guidance outlining the process for the second round of price negotiations for products subject to the “maximum fair price” provision;

and on December 20, 2024, releasing a list of 64 Medicare Part B products that had an adjusted coinsurance rate based on the inflationary rebate provisions of the IRA for the time period of January 1, 2025, to March 31, 2025.

While it remains to be seen how the drug pricing provisions imposed by the IRA will affect the broader pharmaceutical industry, several pharmaceutical manufacturers and other industry stakeholders have challenged the law, including through lawsuits brought against the HHS, the Secretary of the HHS, CMS, and the CMS Administrator challenging the constitutionality and administrative implementation of the IRA’s drug price negotiation provisions.

If federal spending is further reduced, anticipated budgetary shortfalls may also impact the ability of relevant agencies, such as the FDA or the NIH to continue to function at current levels.

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These reductions may also impact the ability of relevant agencies to timely review and approve research and development, manufacturing, and marketing activities which may delay our ability to develop, market and sell any products we may develop.

Additionally, the cost of prescription pharmaceuticals and biological products has recently been the subject of considerable discussion in the United States.

For example, in response to an Executive Order dated July 9, 2021, on September 9, 2021, the HHS issued a Comprehensive Plan for Addressing High Drug Prices that identified potential legislative policies and administrative tools that Congress and the agency can pursue in order to make drug prices more affordable and equitable, improve and promote competition throughout the prescription drug industry, and foster scientific innovation.

In addition, on February 2, 2022, the Biden administration signaled its continued commitment to the Cancer Moonshot initiative, which was initially launched in 2016.

Additionally, the cost of prescription pharmaceuticals and biological products has been the subject of considerable discussion in the United States.

For example, on February 2, 2022, the Biden administration signaled its continued commitment to the Cancer Moonshot initiative, which was initially launched in 2016.

In its announcement, the administration noted that its new goals under the initiative include addressing inequities in order to ensure broader access to cutting-edge cancer therapeutics and investing in a robust pipeline for new treatments.

In alignment with President Biden’s Cancer Moonshot initiative, on June 27, 2023, the Center for Medicare Innovation at CMS announced a new model, the Enhancing Oncology Model, that is designed to make high-quality cancer care more affordable to both patients and Medicare.

On September 12, 2022, President Biden issued an Executive Order to promote biotechnology and biomanufacturing innovation.

The Order noted several methods through which the Biden administration would support the advancement of biotechnology and biomanufacturing in healthcare, and instructed the HHS to submit, within 180 days of the Order, a report assessing how to use biotechnology and biomanufacturing to achieve medical breakthroughs, reduce the overall burden of disease, and improve health outcomes.

Additionally, on October 14, 2022 President Biden issued an Executive Order on Lowering Prescription Drug Costs for Americans, which instructed the Secretary of the HHS to consider whether to select for testing by the CMS Innovation Center new health care payment and delivery models that would lower drug costs and promote access to innovative drug therapies for beneficiaries enrolled in the Medicare and Medicaid programs.

The Executive Order further directed the Secretary of the HHS to submit, within 90 days after the date of the Executive Order, a report regarding any models that may lead to lower cost-sharing for commonly used drugs and support value-based payment that promotes high-quality care.

Additionally, on October 14, 2022, President Biden issued an Executive Order on Lowering Prescription Drug Costs for Americans, which instructed the Secretary of the HHS to consider whether to select for testing by the CMS Innovation Center new healthcare payment and delivery models that would lower drug costs and promote access to innovative drug therapies for beneficiaries enrolled in the Medicare and Medicaid programs.

On February 14, 2023, HHS issued a report in response to the October 14, 2022, Executive Order, which, among other things, selects three potential drug affordability and accessibility models to be tested by the CMS Innovation Center.

Specifically, the report addresses:

(1) a model that would allow Part D Sponsors to establish a “high-value drug list” setting the maximum co-payment amount for certain common generic drugs at $2;

(2) a Medicaid-focused model that would establish a partnership between CMS, manufacturers, and state Medicaid agencies that would result in multi-state outcomes-based agreements for certain cell and gene therapy drugs;

and (3) a model that would adjust Medicare Part B payment amounts for Accelerated Approval Program drugs to advance the developments of novel treatments.

Moreover, there have been several recent U.S.

Congressional inquiries and proposed federal legislation designed to, among other things, bring more transparency to drug and biological product pricing, review the relationship between pricing and manufacturer patient support programs, reduce the cost of prescription drugs and biological products under Medicare and reform government program reimbursement methodologies for drug and biological products.

While several proposed reform measures will require Congress to pass legislation to become effective, Congress and the Biden administration have each indicated that it will continue to seek new legislative and/or administrative measures to address prescription drug and biological product costs, as discussed in greater detail in the section titled “Risk Factors.”

It remains to be seen how these drug pricing initiatives will affect the broader pharmaceutical industry.

Moreover, results of the 2024 Presidential and Congressional elections, and potential subsequent developments, increase the uncertainty related to the healthcare regulatory environment.

In addition, on June 28, 2024, the U.S.

Supreme Court issued an opinion holding that courts reviewing agency action pursuant to the Administrative Procedure Act (APA) “must exercise their independent judgment” and “may not defer to an agency interpretation of the law simply because a statute is ambiguous.” The decision will have a significant impact on how lower courts evaluate challenges to agency interpretations of law, including those by CMS and other agencies with significant oversight of the healthcare industry.

The new framework is likely to increase both the frequency of such challenges and their odds of success by eliminating one way in which the government previously prevailed in such cases.

As a result, significant regulatory policies may be subject to increased litigation and judicial scrutiny.

Any resulting changes in regulation may result in unexpected delays, increased costs, or other negative impacts that are difficult to predict but could have a material adverse effect on our business and financial condition.

For example, certain of these changes could impose additional limitations on the rates we will be able to charge for our future products or the amounts of reimbursement available for our future products from governmental agencies or third-party payors.

At the state level, legislatures are increasingly passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures and, in some cases, to encourage importation from other countries and bulk purchasing.

Most recently, on January 5, 2024, the FDA approved Florida’s importation plan to allow pharmacists and wholesalers in the state to import certain medications from Canada.

For example, on January 5, 2024, the FDA approved Florida’s importation plan to allow pharmacists and wholesalers in the state to import certain medications from Canada.

The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize any product that is ultimately approved, if approved.

In addition, several recently passed state laws require disclosures related to state agencies and/or commercial purchasers with respect to certain price increases that exceed a certain level as identified in the relevant statutes.

In addition, several recently passed state laws require disclosures related to state agencies and/or commercial purchasers with respect to price increases and new product launches that exceed certain levels as identified in the relevant statutes.

Some of these laws and regulations contain ambiguous requirements that government officials have not yet clarified.

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Our Board’s Compensation Committee is responsible for reviewing with management our human resources activities, which include, among other things, matters relating to employee development, management and engagement, pay equity, and our demographics, diversity and inclusion.

Our Board’s Nominating and Corporate Governance Committee is responsible for developing and recommending to the Board any company program relating to corporate responsibility and sustainability, including environmental, social and governance matters.

Our Board’s Nominating and Corporate Governance Committee is responsible for overseeing company programs relating to corporate responsibility and sustainability, including environmental, social and governance matters.

Corporate Information

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The mark “Nurix” is our registered trademark in Canada, France, Germany, Italy, Japan, Mexico, Spain, the United Kingdom and the United States.

The mark “DELigase” is our registered trademarks in the United States.

The Nurix logo is our common law trademark.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business