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Item 2. Management’s Discussion and Analysis

2026-10-13 compared with 2026-07-09 · 116 added, 99 removed, 258 unchanged (45% of the section changed)

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(Gilead), Sanofi S.A.

(Sanofi) and Seagen Inc.

(Sanofi), 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.

(Pfizer)) and F.

Hoffmann-La Roche Ltd.

and Genentech, Inc.

(together, Roche), within which we retain certain options for co-development, co-commercialization and profit sharing in the United States for multiple drug candidates.

Targeted Protein Degradation

Our portfolio of targeted protein degraders of the B‑cell signaling protein BTK comprises bexobrutideg (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 zelebrudomide (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.

Our targeted protein degradation portfolio includes bexobrutideg (NX‑5948), an investigational, orally bioavailable, highly selective degrader of the B‑cell signaling protein BTK for the treatment of relapsed or refractory B-cell malignancies and potentially autoimmune diseases.

We are developing bexobrutideg under a co-development and co-commercialization collaboration with Roche.

Bexobrutideg (NX-5948):

We are currently conducting a Phase 2 study of bexobrutideg in patients with relapsed or refractory CLL having failed three previous lines of therapy, specifically a covalent BTK inhibitor (cBTKi), a BCL2 inhibitor (BCL2i) and a non-covalent BTK inhibitor (ncBTKi).

We are currently conducting a Phase 2 study of bexobrutideg in patients with relapsed or refractory chronic lymphocytic leukemia (CLL) having failed three previous lines of therapy, specifically a covalent BTK inhibitor (cBTKi), a BCL2 inhibitor (BCL2i) and a non-covalent BTK inhibitor (ncBTKi).

This study is designed as a potentially pivotal trial for Accelerated Approval in the United States and commenced in October 2025 upon FDA agreement for the use of the 600 mg, once-daily dose of bexobrutideg as determined by our Phase 1b study of both a 200 mg and a 600 mg dose in patients in accordance with the FDA’s Project Optimus.

In January 2024, the U.S.

Food and Drug Administration (FDA) granted Fast Track designation for bexobrutideg 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 and a B-cell lymphoma 2 (BCL2) inhibitor.

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

In November 2024, the European Medicines Agency (EMA) granted Priority Medicine (PRIME) designation for bexobrutideg 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 bexobrutideg for the treatment of adult patients with Waldenstrom’s macroglobulinemia (WM) after at least two lines of therapy, including a BTK inhibitor.

In June 2026, we entered into a global collaboration agreement with F.

Hoffmann-La Roche Ltd.

and Genentech, Inc.

(together, Roche), to develop, manufacture, commercialize and otherwise exploit bexobrutideg (NX-5948) (the Roche Collaboration Agreement), which we expect to become effective in the third fiscal quarter of 2026.

In June 2026, we entered into a global collaboration agreement with Roche to develop, manufacture, commercialize and otherwise exploit bexobrutideg (NX-5948) (the Roche Collaboration Agreement), which became effective in July 2026.

For more information regarding the Roche Collaboration Agreement, see “Collaboration and License Agreements – Roche” below.

We and Roche are currently conducting a global, randomized Phase 3 study of bexobrutideg in patients with relapsed or refractory CLL or SLL who have previously received a covalent BTK inhibitor.

The study is designed to demonstrate the superiority of bexobrutideg versus pirtobrutinib, the current standard of care in this treatment setting for patients whose disease has progressed following prior covalent BTK inhibitor therapy, with patients randomized 1:1 to receive either bexobrutideg 600 mg orally once per day or pirtobrutinib and with dual primary endpoints of objective response rate and progression-free survival, as assessed by an independent review committee.

This Phase 3 study, the DAYBreak CLL-306 trial, enrolled its first patient in August 2026.

Zelebrudomide (NX-2127):

We are currently conducting a Phase 1a/1b dose-escalation and cohort expansion study of zelebrudomide 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 zelebrudomide.

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.

Enrollment in the current dose escalation cohorts of the Phase 1 trial has been completed and we are reviewing the data to determine next steps.

Degradation Inhibitor

We previously were developing zelebrudomide (NX‑2127), an investigational orally bioavailable degrader that simultaneously degrades BTK and the cereblon neosubstrates IKZF1 (Ikaros) and IKZF3 (Aiolos), in a Phase 1 clinical trial in patients with relapsed or refractory B-cell malignancies.

In August 2026, as part of a strategic prioritization of our wholly owned oncology portfolio, we decided to discontinue further clinical development of zelebrudomide.

Patients currently receiving zelebrudomide may continue treatment for as long as clinically appropriate.

We will conduct essential safety monitoring while patients remain on treatment, and each treating institution will provide follow-up under its standard of care.

Degradation Inhibition

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

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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 included 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.

In 2022, NX-1607 was awarded an Innovation 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.

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

In September 2026, we dosed the first patient in Phase 1b monotherapy expansion cohorts evaluating NX-1607 in patients with microsatellite-stable colorectal cancer (MSS CRC), non-small cell lung cancer (NSCLC), metastatic castration-resistant prostate cancer (CRPC) and metastatic melanoma.

In 2022, NX-1607 received an Innovation Passport from the UK Medicines and Healthcare products Regulatory Agency, which provides entry into a UK pre-market pathway designed to accelerate time to market and facilitate patient access to novel drugs to treat serious and life-threatening diseases.

Drug Discovery Pipeline

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These existing and future programs have the potential to provide patients with better options in the 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.

In aggregate, as of May 31, 2026, we had received $489.0 million in non-dilutive financing from these collaborators to date and we were eligible to receive up to $6.1 billion in potential future fees and milestone payments, as well as royalties on future product sales.

In June 2026, we also entered into the Roche Collaboration Agreement, which we expect to become effective in the third fiscal quarter of 2026.

Under the terms of the Roche Collaboration Agreement, we will receive an upfront cash payment of $700 million and will be eligible to receive development, regulatory and sales milestone payments for potential total payments of up to $2.3 billion, including the upfront payment.

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

In aggregate, as of August 31, 2026, we have received $1.2 billion in non-dilutive financing from these collaborators and we are eligible to receive up to $7.2 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.

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These amendments had no impact on revenue recognition.

In February 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.

In February 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 (First Gilead Research Term Extension).

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

In August 2026, we entered into the Third Amendment to the Gilead Agreement to extend the research term for one collaboration target by an additional two years (Second Gilead Research Term Extension).

Pursuant to the Third Amendment, we expect to receive a one-time research term extension fee of $10.0 million for the Second Gilead Research Term Extension.

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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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 May 31, 2026, we have received payments of $47.0 million for research milestones and additional payments, $20.0 million for a license option exercise payment, $15.0 million in research term extension fees and $5.0 million for a clinical milestone payment.

As of May 31, 2026, 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.

In addition, from the signing of the Gilead Agreement to August 31, 2026, we have received payments of $47.0 million for research milestones and additional payments, $20.0 million for a license option exercise payment, $15.0 million in research term extension fees and $5.0 million for a clinical milestone payment.

As of August 31, 2026, we are eligible to receive up to approximately $1.3 billion in total additional payments based on certain additional fees, payments and the successful completion of certain preclinical, clinical, development and sales milestones.

We also are eligible to receive mid-single digit to low tens percentage tiered royalties on annual net sales from any commercial products directed to the optioned collaboration targets, 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 Gilead Agreement expires on a licensed product-by-licensed product and country-by-country basis upon 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 Gilead Agreement, provided that the term for any profit-shared licensed product in the United States will expire upon the expiration or termination of the applicable profit-share term as set forth in an applicable profit-share agreement to be negotiated upon our exercise of our option to co-develop and co-promote such licensed product.

We recognized collaboration revenue from the Gilead Agreement of $2.1 million and $3.6 million during the three and six months ended May 31, 2026, respectively, and $1.6 million and $3.3 million during the three and six months ended May 31, 2025, respectively.

As of May 31, 2026 and November 30, 2025, there was $0.2 million and $3.8 million, respectively, of deferred revenue related to payments received by us under the Gilead Agreement.

We recognized collaboration revenue from the Gilead Agreement of $0.2 million and $3.8 million during the three and nine months ended August 31, 2026, respectively, and $2.1 million and $5.5 million during the three and nine months ended August 31, 2025, respectively.

As of August 31, 2026 and November 30, 2025, there was $10.0 million and $3.8 million, respectively, of deferred revenue related to payments received by us under the Gilead Agreement.

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.

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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, which had no impact on revenue recognition.

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, which is expected to increase overall forecasted costs and have an impact on revenue recognition.

In April 2026, we entered into the Seventh Amendment to the Sanofi Agreement to enable Sanofi to continue research activities for the collaboration target STAT6 and for an additional collaboration target after the expiration of the original research term.

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, which increased overall forecasted costs and had an impact on revenue recognition.

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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Subsequently, in January 2021, Sanofi paid us an additional $22.0 million to exercise its option to expand the number of targets beyond the initial targets included in the collaboration.

In addition, from the signing of the Sanofi Agreement to May 31, 2026, we have received payments of $22.0 million for research milestones and $30.0 million for license extension fees.

As of May 31, 2026, we are eligible to receive up to approximately $937.0 million in total additional payments based on certain additional fees, payments and the successful completion of certain research, development, regulatory and sales milestones.

In addition, from the signing of the Sanofi Agreement to August 31, 2026, we have received payments of $22.0 million for research milestones and $30.0 million for license extension fees.

As of August 31, 2026, we are eligible to receive up to approximately $937.0 million 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 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.

We recognized collaboration revenue from the Sanofi Agreement of $2.0 million during the three and six months ended May 31, 2026, and $3.4 million and $16.1 million of collaboration revenue during the three and six months ended May 31, 2025, respectively.

As of May 31, 2026 and November 30, 2025, there was no deferred revenue related to payments received by us under the Sanofi Agreement and all performance obligations were satisfied.

We recognized collaboration revenue from the Sanofi Agreement of $10.0 million and $12.0 million during the three and nine months ended August 31, 2026, respectively, and zero and $16.1 million of collaboration revenue during the three and nine months ended August 31, 2025, respectively.

As of August 31, 2026 and November 30, 2025, there was no deferred revenue related to payments received by us under the Sanofi Agreement and all performance obligations were satisfied.

In September 2023, we entered into a strategic collaboration with Seagen Inc.

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

In addition, from the signing of the Pfizer Agreement to May 31, 2026, we have received payments of $15.0 million for research milestones.

In addition, from the signing of the Pfizer Agreement to August 31, 2026, we have received payments of $15.0 million for research milestones.

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.

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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.

We recognized collaboration revenue from the Pfizer Agreement of $5.0 and $9.7 million during the three and six months ended May 31, 2026, respectively, and $4.0 million and $8.0 million during the three and six months ended May 31, 2025, respectively.

As of May 31, 2026 and November 30, 2025, there was $19.1 million and $23.8 million, respectively, of deferred revenue related to payments received by us under the Pfizer Agreement.

On June 6, 2026, we entered into the Roche Collaboration Agreement to develop, manufacture, commercialize and otherwise exploit bexobrutideg (NX-5948).

Under the terms of the Roche Collaboration Agreement, we will receive an upfront cash payment of $700.0 million and are eligible to receive development, regulatory and sales milestone payments for potential total payments of up to $2.3 billion, including the upfront payment.

Development costs will be shared 40% by us and 60% by Roche, subject to specified exceptions.

The parties will equally split the profits and losses from U.S.

commercialization.

We and Roche will co-develop and co-commercialize bexobrutideg in the United States across all indications.

Outside of the United States, Roche will be responsible for development and commercialization, and we are eligible to receive tiered royalties at rates ranging from the low teens to the high teens on ex-U.S.

The Roche Collaboration Agreement will become effective upon the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the expiration, termination or resolution of all other required waiting periods, clearance decisions or outstanding inquiries under antitrust laws.

We recognized collaboration revenue from the Pfizer Agreement of $9.7 million and $19.4 million during the three and nine months ended August 31, 2026, respectively, and $5.8 million and $13.8 million during the three and nine months ended August 31, 2025, respectively.

As of August 31, 2026 and November 30, 2025, there was $9.4 million and $23.8 million, respectively, of deferred revenue related to payments received by us under the Pfizer Agreement.

In June 2026, we entered into a strategic collaboration with F.

Hoffmann-La Roche Ltd.

and Genentech, Inc.

(together, Roche), to develop, manufacture, commercialize and otherwise exploit bexobrutideg (NX-5948) (the Roche Collaboration Agreement).

The Roche Collaboration Agreement became effective in July 2026 upon clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

Under the Roche Collaboration Agreement, we granted Roche an exclusive, worldwide license, including with respect to us and our affiliates, to develop, manufacture, commercialize and otherwise exploit bexobrutideg and products containing bexobrutideg (the Development and Commercialization License).

The Development and Commercialization License is subject to limited licenses Roche granted to us to perform our development, manufacturing, commercialization and other activities under the Roche Collaboration Agreement.

We and Roche will co-develop and co-commercialize bexobrutideg in the United States across all indications, and Roche will commercialize bexobrutideg outside the United States.

In addition, we will perform certain other development and manufacturing activities allocated to us under the Roche Collaboration Agreement.

Global development costs will be shared 40% by us and 60% by Roche, subject to specified exceptions.

The parties will equally share net profits and net losses from commercialization in the United States.

Roche will have primary responsibility for certain regulatory, manufacturing and commercialization activities, subject to our specified participation rights in the United States.

Under the terms of the Roche Collaboration Agreement, we received an upfront payment of $700.0 million.

As of August 31, 2026, we are eligible to receive up to approximately $1.6 billion in total additional payments, including specified payments upon the achievement of certain development milestones, regulatory milestones, launch milestones outside of the United States and sales milestones outside of the United States.

We are eligible to receive tiered royalties at rates ranging from the low teens to the high teens on product sales outside of the United States.

We are also eligible to receive our share of net profits from commercialization in the United States.

Subject to earlier termination in accordance with its terms, the Roche Collaboration Agreement expires (a) in the United States, on a product-by-product basis, upon the expiration of the profit/loss share term for the applicable product, and (b) outside the United States, on a product-by-product and country-by-country basis, upon the expiration of the royalty term for the applicable product in the applicable country.

The agreement expires in its entirety upon the expiration of the last royalty term and the last profit/loss share term.

Upon expiration of the applicable term for a product in a country, Roche’s license for that product in that country will remain exclusive and become fully paid-up, irrevocable, perpetual and royalty-free .

For the three and nine months ended August 31, 2026, we recognized $1.2 million of the consideration allocated to the combined development services performance obligation as a reduction of research and development expense.

As of August 31, 2026, deferred collaboration funding related to the combined development services performance obligation was $45.6 million, of which $22.2 million was current.

For the three and nine months ended August 31, 2026, we recognized a $3.3 million cost-sharing allocation as an offset to research and development expenses on the condensed statements of operations related to the Roche Collaboration Agreement.

As of August 31, 2026, we recorded a net receivable from Roche of $3.3 million in prepaid expenses and other current assets on the condensed balance sheet.

Financial Overview

Since the commencement of our operations, we have devoted substantially all of our resources to conducting research and development activities, establishing and maintaining our intellectual property portfolio, establishing our corporate infrastructure, raising capital and providing general and administrative support for these operations.

We have funded our operations to date primarily from proceeds received under collaboration and license agreements with Celgene Corporation, Gilead, Sanofi and Pfizer and the issuance and sale of common stock, redeemable convertible preferred stock and pre-funded warrants.

We have funded our operations to date primarily from proceeds received under collaboration and license agreements with Celgene Corporation, Gilead, Sanofi, Pfizer and Roche and the issuance and sale of common stock, redeemable convertible preferred stock and pre-funded warrants.

We do not expect to generate product revenue unless and until we successfully develop and obtain approval for the commercialization of a drug candidate, and we cannot assure you that we will ever generate significant revenue or profits.

Since inception, we have generally incurred significant losses and negative cash flows from operations.

During the six months ended May 31, 2026 and 2025, we incurred net losses of $176.7 million and $99.8 million, respectively.

As of May 31, 2026, we had an accumulated deficit of $1.2 billion.

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

During the nine months ended August 31, 2026, we had net income of $373.1 million, and during the nine months ended August 31, 2025, we had a net loss of $186.2 million.

As of August 31, 2026, we had an accumulated deficit of $630.1 million.

Our net income for the nine months ended August 31, 2026, was primarily attributable to the $653.2 million of license revenue recognized under the Roche Collaboration Agreement.

Our historical losses have resulted primarily from costs incurred in connection with research and development activities and general and administrative costs associated with our operations.

We do not expect to generate any revenue from commercial product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our drug candidates, which we expect will take a number of years, if ever.

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Furthermore, we expect to continue incurring costs associated with operating as a public company, including significant legal, accounting, insurance, investor relations and other administrative and professional services expenses.

Our net losses and cash flows may fluctuate significantly from period to period, depending on, among other things, variations in the level of expense related to the ongoing development of our drug candidates, our DEL-AI platform or future development programs;

Our results of operations and cash flows may fluctuate significantly from period to period, depending on, among other things, variations in the level of expense related to the ongoing development of our drug candidates, our DEL-AI platform or future development programs;

the delay, addition or termination of clinical trials;

and the execution of any additional collaboration, licensing or similar arrangements, and the timing of payments we may make or receive under such arrangements.

As of May 31, 2026, we had $443.5 million in cash, cash equivalents and marketable securities, and we expect to receive a $700.0 million upfront payment from Roche in the third fiscal quarter of 2026.

As of August 31, 2026, we had $1.1 billion in cash, cash equivalents and marketable securities.

We expect that our existing cash, cash equivalents and marketable securities are sufficient to fund our operations for at least the next 12 months.

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Impact of Current Business, Political and Macroeconomic Conditions

Uncertainty in the business, political and macroeconomic environments present significant risks to our business.

Uncertainty in the business, political and macroeconomic environments presents significant risks to our business.

We are subject to continuing risks and uncertainties, including increasing financial market volatility and uncertainty, inflation, interest rate fluctuations, changing tariff policies and trade restrictions, uncertainty with respect to the federal budget and debt ceiling and potential government shutdowns related thereto, instability in the global banking system, cybersecurity events, the impact of war or military conflict, including regional conflicts around the world, and public health pandemics.

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Provision for Income Taxes

The provision for income taxes primarily consists of reserves for unrecognized tax benefits and state taxes.

We have generated net operating losses since inception and have established a full valuation allowance against our deferred tax assets due to the uncertainty surrounding the realization of such assets.

Our provision for income taxes consists primarily of U.S.

federal and state income taxes, as well as reserves for unrecognized tax benefits.

We have historically generated net operating losses and have established a full valuation allowance against our deferred tax assets due to the uncertainty surrounding the realization of such assets.

Critical Accounting Policies and Estimates

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Our critical accounting policies and more significant areas involving management’s judgments and estimates used in preparation of our condensed financial statements are discussed in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended November 30, 2025.

There have been no significant changes to these policies for the three and six months ended May 31, 2026.

There have been no significant changes to these policies for the three and nine months ended August 31, 2026.

Recent Accounting Pronouncements

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Results of Operations

Comparison of the three and six months ended May 31, 2026 and 2025

Comparison of the three and nine months ended August 31, 2026 and 2025

Our results of operations are summarized as follows (in thousands):

Three Months Ended

May 31, Change Six Months Ended

May 31, Change

August 31, Change Nine Months Ended

August 31, Change

2026 2025 2026 2025

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Total operating expenses 113,613 99,279 14,334 315,607 272,974 42,633

Loss from operations (94,204) (48,322) (45,882) (186,699) (111,186) (75,513)

Income (loss) from operations 559,451 (91,385) 650,836 372,752 (202,571) 575,323

Interest and other income, net 3,962 4,964 (1,002) 13,681 17,095 (3,414)

Loss before income taxes (89,806) (42,704) (47,102) (176,980) (99,055) (77,925)

Provision for (benefit from) income taxes (271) 760 (1,031) (271) 760 (1,031)

Net loss $ (89,535) $ (43,464) $ (46,071) $ (176,709) $ (99,815) $ (76,894)

Income (loss) before income taxes 563,413 (86,421) 649,834 386,433 (185,476) 571,909

Provision for income taxes 13,606 — 13,606 13,335 760 12,575

Net income (loss) $ 549,807 $ (86,421) $ 636,228 $ 373,098 $ (186,236) $ 559,334

Collaboration Revenue

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Three Months Ended

May 31, Change Six Months Ended

May 31, Change

August 31, Change Nine Months Ended

August 31, Change

2026 2025 2026 2025

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Total collaboration revenue $ 19,908 $ 7,894 $ 12,014 $ 35,203 $ 40,403 $ (5,200)

Our collaboration revenue decreased by $5.0 million and $17.2 million during the three and six months ended May 31, 2026, compared to the three and six months ended May 31, 2025, respectively.

For all periods presented, the decrease in revenue from our collaborations with Gilead and Sanofi was primarily attributable to the conclusion of the initial research term for certain drug targets.

Our collaboration revenue increased by $12.0 million during the three months ended August 31, 2026, compared to the three months ended August 31, 2025, primarily due to increased revenue from our collaboration with Sanofi due to the achievement of a development milestone.

Our collaboration revenue decreased by $5.2 million during the nine months ended August 31, 2026, compared to the nine months ended August 31, 2025, primarily due to the decrease in revenue from our collaborations with Gilead and Sanofi as we concluded the initial research term for certain drug targets.

License Revenue

Our license revenue was $30.0 million for the three and six months ended May 31, 2025 and is related to the Sanofi License Extensions.

There was no license revenue for the three and six months ended May 31, 2026.

Our license revenue was $653.2 million for the three and nine months ended August 31, 2026, and represents the portion of the upfront payment received for the Development and Commercialization License under the Roche Collaboration Agreement.

Our license revenue was $30.0 million for the nine months ended August 31, 2025, and represents fees from the Sanofi License Extensions.

There was no license revenue for the three months ended August 31, 2025.

Research and Development Expenses

Our research and development expenses increased by $9.6 million during the three months ended May 31, 2026, compared to the three months ended May 31, 2025.

There was an increase in clinical, contract manufacturing and consulting costs as we continued to accelerate the enrollment of patients in the ongoing clinical trials of bexobrutideg (NX-5948) and prepare for the initiation of additional trials, and an increase in contract research costs to support our ongoing collaborations.

Our research and development expenses increased by $24.0 million during the six months ended May 31, 2026, compared to the six months ended May 31, 2025.

Our research and development expenses decreased by $6.9 million during the three months ended August 31, 2026, compared to the three months ended August 31, 2025, as a result of the cost sharing offset related to the Roche Collaboration Agreement and a decrease in contract manufacturing due to timing.

Our research and development expenses increased by $17.2 million during the nine months ended August 31, 2026, compared to the nine months ended August 31, 2025.

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General and Administrative Expenses

Our general and administrative expenses increased by $1.3 million during the three months ended May 31, 2026, compared to the three months ended May 31, 2025.

There was an increase in legal costs for collaboration and business development activities.

Our general and administrative expenses increased by $4.3 million during the six months ended May 31, 2026, compared to the six months ended May 31, 2025.

There was an increase in personnel related costs attributable to higher average employee compensation, an increase in non-cash stock-based compensation expense primarily driven by the increased issuance of restricted stock units and incentive stock options and an increase in legal costs for collaboration and business development activities.

Our general and administrative expenses increased by $21.2 million and $25.5 million during the three and nine months ended August 31, 2026, compared to the three and nine months ended August 31, 2025, respectively.

For all periods presented, there was an increase due to one-time expenses associated with the Roche transaction for consulting and business development activities.

Liquidity and Capital Resources

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In August 2021, we filed a shelf registration statement on Form S-3 with the SEC, which was amended in February 2023 (the Shelf Registration Statement) and which expired in August 2024 with respect to additional sales of securities.

The Shelf Registration Statement, which included a base prospectus, allowed us to offer and sell up to $450.0 million of our registered common stock, preferred stock, debt securities, warrants, subscriptions rights and/or units or any combination of securities described in the prospectus in one or more offerings.

The Shelf Registration Statement, which included a base prospectus, allowed us to offer and sell up to $450.0 million of our registered common stock, preferred stock, debt securities, warrants, subscription rights and/or units or any combination of securities described in the prospectus in one or more offerings.

In addition, in August 2021, we entered into an Equity Distribution Agreement with Piper Sandler & Co.

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We agreed to pay Piper Sandler a commission of up to 3.0% of the gross sales price of any shares sold pursuant to the Third Amended Equity Distribution Agreement.

As of May 31, 2026, we had $300.0 million of common stock remaining available for sale under the Third Amended Equity Distribution Agreement.

As of August 31, 2026, we had $300.0 million of common stock remaining available for sale under the Third Amended Equity Distribution Agreement.

In July 2022, we entered into separate securities purchase agreements with certain purchasers to issue and sell pre‑funded warrants to purchase an aggregate of 6,814,920 shares of our common stock in registered direct offerings (RDOs) at a price of $13.939 per pre-funded warrant (the 2022 Pre-Funded Warrants).

Net proceeds from the RDOs were $94.8 million, after deducting offering expenses of $0.2 million.

As of May 31, 2026, a total of 6,097,560 of the 2022 Pre-Funded Warrants remained available for exercise.

As of August 31, 2026, a total of 2,869,440 of the 2022 Pre-Funded Warrants remained available for exercise.

In April 2024, we completed an underwritten public offering (the 2024 Public Offering) and issued (a) 11,916,667 shares of common stock, which included 1,750,000 shares issued upon the exercise in full by our underwriters of their option to purchase additional shares of common stock, at a public offering price of $15.00 per share, and (b) pre-funded warrants to purchase 1,500,100 shares of our common stock (the 2024 Pre-Funded Warrants) at a public offering price of $14.999 per pre-funded warrant, which represents the per share public offering price for the common stock less a $0.001 per share exercise price for each pre-funded warrant.

The net proceeds from this offering were approximately $188.7 million, after deducting underwriting discounts and commissions and offering expenses.

As of May 31, 2026, a total of 1,480,349 of the 2024 Pre-Funded Warrants remained available for exercise.

As of August 31, 2026, none of the 2024 Pre-Funded Warrants remained available for exercise.

All issued pre-funded warrants were immediately exercisable, have an exercise price of $0.001 and may be exercised at any time after the date of issuance.

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Funding Requirements

As of May 31, 2026, our operations have primarily been funded through the net proceeds from equity offerings of $1.4 billion and proceeds from collaborations of $489.0 million.

As of August 31, 2026, our operations have primarily been funded through the net proceeds from equity offerings of $1.4 billion and proceeds from collaborations of $1.2 billion.

We do not have any products approved for sale, and we have not generated any revenue from product sales.

As of May 31, 2026, we had $443.5 million in cash, cash equivalents and marketable securities, and we expect to receive an additional $700.0 million upfront payment from Roche in the third fiscal quarter of 2026.

We expect that our existing cash, cash equivalents and marketable securities are sufficient to meet our cash requirements and continue operating activities, including the clinical trials of our drug candidates bexobrutideg (NX-5948), zelebrudomide (NX-2127) and NX-1607 and the expansion of our intellectual property portfolio and infrastructure, for at least the next 12 months.

As of August 31, 2026, we had $1.1 billion in cash, cash equivalents and marketable securities.

We expect that our existing cash, cash equivalents and marketable securities are sufficient to meet our cash requirements and continue operating activities, including the clinical trials of our drug candidates bexobrutideg (NX-5948), which is in late-stage clinical development under a co-development and co-commercialization collaboration with Roche, and NX-1607 and the expansion of our intellectual property portfolio and infrastructure, for at least the next 12 months.

We will need substantial additional funding to support our continuing operations and pursue our long-term business plan.

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In the long term, our ability to support our working capital and capital expenditure requirements will depend on many factors, including the following:

• the progress, costs and results of our Phase 1 and Phase 2 clinical trials for our lead drug candidate bexobrutideg, our Phase 1 clinical trials for zelebrudomide and NX-1607, and any future clinical development of such drug candidates;

• the progress, costs and results of our clinical trials for our lead drug candidates bexobrutideg and NX-1607, and any future clinical development of such drug candidates;

• the scope, progress, costs and results of preclinical and clinical development for our other drug candidates and development programs;

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• the costs, timing and outcome of regulatory review of our drug candidates;

• the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distribution, for any of our drug candidates for which we receive marketing approval;

• the costs and timing of commercial readiness and future commercialization activities, including product manufacturing, marketing, sales and distribution, for any of our drug candidates for which we receive marketing approval;

• the revenue, if any, received from commercial sales of our drug candidates for which we receive marketing approval;

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Our contractual obligations mostly consist of our operating lease obligations for facilities in Brisbane, California and The Woodlands, Texas.

Our total operating lease commitments as of May 31, 2026, were approximately $83.6 million, of which $9.0 million is expected to be paid within the next 12 months.

Our total operating lease commitments as of August 31, 2026, were approximately $81.7 million, of which $9.5 million is expected to be paid within the next 12 months.

In addition, we enter into agreements in the normal course of business with contract research organizations for clinical trials and with vendors for preclinical studies and other services and products for operating purposes, which are generally cancelable upon written notice.

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Our cash flows are summarized as follows (in thousands):

Six Months Ended

Cash used in operating activities $ (168,487) $ (124,248)

Cash provided by (used in) investing activities (30,829) 97,032

Nine Months Ended

Cash provided by (used in) operating activities $ 447,144 $ (181,633)

Cash provided by investing activities 752 147,507

Cash provided by financing activities 25,200 2,634

Net decrease in cash, cash equivalents and restricted cash $ (179,275) $ (25,737)

Net increase (decrease) in cash, cash equivalents and restricted cash $ 473,096 $ (31,492)

Operating activities

Net cash used in operating activities was $168.5 million for the six months ended May 31, 2026, and consisted of a net loss of $176.7 million, offset by a increase in net assets of $16.8 million and non-cash adjustments of $25.0 million.

The increase in net assets consisted of a decrease in deferred revenue of $8.3 million as we increased effort in our programs and recognized revenue and a decrease in accrued expenses and other accrued liabilities of $11.1 million primarily due to the payment of compensation and other related personnel costs and costs related to our clinical trials, offset by a decrease in prepaid and other assets of $1.6 million primarily due to the recognition of expenses for prepaid services and an increase in accounts payable of $1.4 million from payments to vendors.

Non-cash adjustments primarily consisted of stock-based compensation expenses of $20.8 million, depreciation and amortization expenses of $4.5 million and amortization of operating lease right-of-use (ROU) assets of $3.2 million, offset by net accretion of discount on marketable securities of $3.5 million.

Net cash used in operating activities was $124.2 million for the six months ended May 31, 2025, and consisted of a net loss of $99.8 million and an increase in net assets of $46.5 million, offset by non-cash adjustments of $22.1 million.

The increase in net assets consisted of a decrease in deferred revenue of $15.5 million as we increased effort in our programs and recognized revenue, a decrease in operating lease liabilities of $3.1 million due to lease payments made during the period, a decrease in accounts payable of $5.9 million from payments to vendors, an increase in accounts receivable of $19.0 million related to the Second Sanofi License Extension and a milestone payment under the Sanofi Agreement, and an increase in other assets of $3.0 million primarily for the Brisbane lease security deposit.

Net cash provided by operating activities was $447.1 million for the nine months ended August 31, 2026, and consisted of a net income of $373.1 million, non-cash adjustments of $38.5 million and a net change in operating assets and liabilities of $35.6 million.

The change in operating assets and liabilities consisted of a $20.0 million increase in accounts receivable related to the Second Gilead Research Term Extension and a milestone under the Sanofi Agreement, a $12.0 million increase in prepaid and other assets primarily related to increased prepaid clinical costs, and an $8.2 million decrease in deferred revenue as we increased effort in our programs and recognized revenue, partially offset by a $45.6 million increase in deferred collaboration funding related to the combined development services performance obligation under the Roche Collaboration Agreement, a $22.0 million increase in accounts payable primarily due to one-time expenses associated with the Roche transaction for consulting and business development activities and a $9.3 million increase in other accrued expenses and other current liabilities primarily due to the accrued income taxes.

Net cash used in operating activities was $181.6 million for the nine months ended August 31, 2025, and consisted of a net loss of $186.2 million and an increase in net assets of $30.0 million, offset by non-cash adjustments of $34.6 million.

The increase in net assets consisted of a decrease in deferred revenue of $23.4 million as we increased effort in our programs and recognized revenue, a decrease in operating lease liabilities of $4.3 million due to lease payments made during the period, a decrease in accounts payable of $3.7 million from payments to vendors, an increase in prepaid and other assets of $4.9 million primarily due to security deposit payments related to the Brisbane Lease, offset by an increase in accrued expenses and other accrued liabilities of $6.3 million primarily due to the accrual of costs related to our clinical trials.

Non-cash adjustments primarily consisted of stock-based compensation expenses of $28.9 million, depreciation and amortization expenses of $6.6 million and amortization of operating lease ROU assets of $7.6 million, offset by net accretion of discount on marketable securities of $8.5 million.

Investing activities

Net cash used in investing activities was $30.8 million for the six months ended May 31, 2026, and primarily consisted of the purchase of marketable securities of $280.6 million and the purchase of property and equipment of $3.0 million, partially offset by the maturity of marketable securities of $252.7 million.

Net cash provided by investing activities was $97.0 million for the six months ended May 31, 2025, and primarily consisted of the maturity of marketable securities of $281.5 million, offset by the purchase of marketable securities of $178.4 million and the purchase of property and equipment of $6.2 million.

Net cash provided by investing activities was $0.8 million for the nine months ended August 31, 2026, and primarily consisted of the maturity of marketable securities of $435.1 million, offset by the purchase of marketable securities of $430.0 million and the purchase of property and equipment of $4.4 million.

Net cash provided by investing activities was $147.5 million for the nine months ended August 31, 2025, and primarily consisted of the maturity of marketable securities of $437.7 million, partially offset by the purchase of marketable securities of $281.4 million and the purchase of property and equipment of $8.9 million.

Financing activities

Net cash provided by financing activities was $20.0 million for the six months ended May 31, 2026, and consisted primarily of proceeds from the January 2026 ATM financing and issuance of common stock under our Employee Stock Purchase Plan (ESPP).

Net cash provided by financing activities was $1.5 million for the six months ended May 31, 2025, and consisted primarily of proceeds from the issuance of common stock under our ESPP.

Net cash provided by financing activities was $25.2 million for the nine months ended August 31, 2026, and consisted primarily of proceeds from the January 2026 ATM financing, the exercise of stock options and the issuance of common stock under our Employee Stock Purchase Plan (ESPP).

Net cash provided by financing activities was $2.6 million for the nine months ended August 31, 2025, and consisted primarily of proceeds from the issuance of common stock under our ESPP.

Quantitative and Qualitative Disclosures About Market Risk

Our market risks, as of May 31, 2026, have not changed materially from those discussed in “Item 7A.

Our market risks, as of August 31, 2026, have not changed materially from those discussed in “Item 7A.

Quantitative and Qualitative Disclosures About Market Risk” of Part II of our Annual Report on Form 10-K for the year ended November 30, 2025, filed with the SEC on January 28, 2026.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis