OnKure Therapeutics, Inc. 10-K

Item 8. Financial Statements and Supplementary Data 94 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (KPMG LLP; Denver, Colorado; PCAOB ID: 185) 96 Consolidated Balance Sheets 97 Consolidated Statements of Operations and Comprehensive Loss 98 Consolidated Statements of Changes in Stockholders’ Equity 99 Consolidated Statements of Cash Flows 100 Notes to Consolidated Financial Statements 101 95 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and Board of Directors of OnKure Therapeutics, Inc.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of OnKure Therapeutics, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity, and cash flows for the years then ended and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles . Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has suffered recurring losses and negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ KPMG LLP We have served as the Company’s auditor since 2021. Denver, Colorado March 12, 2026 96 ONKURE THERAPEUTICS, INC. Consolidated Balance Sheets (In thousands, except par value and share data) December 31, December 31, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 59,050 $ 110,761 Prepaid expenses and other current assets 1,789 2,242 Total current assets 60,839 113,003 Property and equipment, net 618 1,025 Operating lease right-of-use asset 387 770 Other assets 273 109 Total assets $ 62,117 $ 114,907 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 1,433 $ 2,968 Accrued expenses and other current liabilities 3,939 7,026 Operating lease liabilities, current portion 549 536 Total current liabilities 5,921 10,530 Long-term operating lease liabilities — 549 Other long-term liabilities 12 — Total liabilities 5,933 11,079 Commitments and contingencies Stockholders’ equity: Common stock, Class A, $ 0.0001 par value; 200,000,000 shares authorized; 13,673,565 and 12,660,590 shares issued and outstanding at December 31, 2025 and December 31, 2024, respectively 1 1 Common stock, Class B, $ 0.0001 par value; 10,000,000 shares authorized; no shares and 686,527 shares issued and outstanding at December 31, 2025 and December 31, 2024, respectively — — Additional paid-in capital 270,424 258,551 Accumulated deficit ( 214,241 ) ( 154,724 ) Total stockholders’ equity 56,184 103,828 Total liabilities and stockholders’ equity $ 62,117 $ 114,907 The accompanying notes are an integral part of these consolidated financial statements. 97 ONKURE THERAPEUTICS, INC. Consolidated Statements of Operations and Comprehensive Loss (In thousands, except share and per share data) Years Ended December 31, 2025 2024 (in thousands, except share and per share amounts) Operating expenses: Research and development $ 48,260 $ 43,795 General and administrative 14,690 10,591 Total operating expenses 62,950 54,386 Loss from operations ( 62,950 ) ( 54,386 ) Other income: Interest income 3,441 2,013 Interest and other expense ( 8 ) ( 300 ) Total other income (expense) 3,433 1,713 Net loss and comprehensive loss $ ( 59,517 ) $ ( 52,673 ) Net loss per share attributable to common stockholders: Basic and diluted $ ( 4.40 ) $ ( 15.28 ) Weighted average shares outstanding: Basic and diluted 13,515,915 3,447,071 The accompanying notes are an integral part of these consolidated financial statements. 98 ONKURE THERAPEUTICS, INC. Consolidated Statements of Changes in Stockholders’ Equity (In thousands, except share data) Total Additional Stockholders' Convertible Preferred Stock Class A Common stock Class B Common stock Paid-In Accumulated (Deficit)/ Shares Amount Shares Amount Shares Amount Capital Deficit Equity Balance, December 31, 2023 6,840,620 $ 129,825 313,747 $ — — $ — $ 209 $ ( 102,051 ) $ ( 101,842 ) Conversion of Convertible Preferred Stock for Class A and B Common Stock in connection with the Merger ( 6,840,620 ) ( 129,825 ) 6,154,093 1 686,527 — 129,824 — 129,825 Issuance of Class A Common Stock in the Concurrent Financing, less issuance costs — — 2,571,736 — — — 54,428 — 54,428 Issuance of common stock to former stockholders of Reneo Pharmaceuticals, Inc. in the reverse recapitalization — — 3,343,604 — — — 65,499 — 65,499 Reverse recapitalization transaction costs of OnKure — — — — — — ( 2,085 ) — ( 2,085 ) Issuance of Class A Common Stock for the conversion of Convertible Promissory Notes — — 267,269 6,120 6,120 Issuance of Class A common stock for the settlement of restricted stock units — — 7,700 — — — — — — Issuance of Class A Common Stock from the exercise of stock options — — 2,476 — — — 26 — 26 Adjustment for fractional shares in the reverse recapitalization — — ( 35 ) — — — — — — Share-based compensation — — — — — — 4,530 — 4,530 Net loss — — — — — — — ( 52,673 ) ( 52,673 ) Balance, December 31, 2024 — — 12,660,590 $ 1 686,527 $ — $ 258,551 $ ( 154,724 ) $ 103,828 Conversion of Class B Common Stock to Class A Common Stock — — 686,527 — ( 686,527 ) — — — — Issuance of Class A Common Stock under the Employee Stock Purchase Plan — — 107,930 — — — 240 — 240 Vesting of restricted stock units, net — — 218,518 — — — — — — Share-based compensation — — — — — — 11,633 — 11,633 Net loss — — — — — — — ( 59,517 ) ( 59,517 ) Balance, December 31, 2025 — $ — 13,673,565 $ 1 — $ — $ 270,424 $ ( 214,241 ) $ 56,184 The accompanying notes are an integral part of these consolidated financial statements. 99 ONKURE THERAPEUTICS, INC. Consolidated Statements of Cash Flows (In thousands) Years Ended December 31, 2025 2024 (in thousands) Cash flows from operating activities: Net loss $ ( 59,517 ) $ ( 52,673 ) Adjustments to reconcile net loss to net cash used in operating activities: Share-based compensation expense 11,633 4,530 Depreciation and amortization 447 459 Amortization of right-of-use asset - operating 383 203 Loss on disposal of property and equipment 6 — Amortization of debt issuance costs — 142 Non-cash interest expense — 120 Loss on sales of available-for-sale securities — 54 Change in operating assets and liabilities: Prepaid and other assets 289 2,256 Accounts payable, accrued and other liabilities ( 4,545 ) ( 5,927 ) Lease liabilities ( 536 ) ( 281 ) Other long-term liabilities 12 — Net cash used in operating activities ( 51,828 ) ( 51,117 ) Cash flows from investing activities: Proceeds from sales of marketable securities — 15,925 Purchases of property and equipment ( 46 ) ( 52 ) Net cash (used in) provided by investing activities ( 46 ) 15,873 Cash flows from financing activities: Proceeds from the issuance of common stock in Concurrent Financing — 58,881 Payment of issuance costs associated with the Concurrent Financing ( 37 ) ( 4,327 ) Cash acquired in connection with the reverse recapitalization — 57,736 Payment of reverse recapitalization transaction costs ( 40 ) ( 2,045 ) Proceeds from issuance of convertible notes payable — 6,000 Payment of issuance costs associated with the issuance of convertible notes payable — ( 142 ) Proceeds from sale of stock under the employee stock purchase plan 240 — Proceeds from the issuance of common stock for exercises of stock options — 26 Net cash provided by financing activities 163 116,129 Net decrease in cash and cash equivalents ( 51,711 ) 80,885 Cash and cash equivalents, beginning of period 110,761 29,876 Cash and cash equivalents, end of period $ 59,050 $ 110,761 Supplemental cash flow information: Interest paid $ — $ — Supplemental disclosure of noncash investing activities: Conversion of Series C Preferred Stock $ — $ 129,825 Conversion of convertible note payable $ — $ 6,120 Assets acquired in connection with the reverse recapitalization $ — $ 17,222 Other liabilities assumed in connection with the reverse recapitalization $ — $ 9,459 Reverse recapitalization transaction costs included in accounts payable $ — $ 40 Concurrent Financing issuance costs included in accounts payable $ — $ 37 Concurrent Financing issuance costs paid by Reneo prior to Merger $ — $ 89 The accompanying notes are an integral part of these consolidated financial statements. 100 ONKURE THERAPEUTICS, INC. Notes to Consolidated Financial Statements 1. Organization and Business OnKure Therapeutics, Inc. (“OnKure” or the “Company”) is a clinical-stage biopharmaceutical company focused on the discovery and development of precision medicines that target biologically validated drivers of diseases that are underserved by available therapies. Using a structure-based drug design platform, OnKure is committed to improving clinical outcomes for patients by building a pipeline of small molecule drugs designed to achieve optimal efficacy and tolerability by selectively target specific mutations thought to be key drivers of cancer and other diseases. The Company was formed in 2014 as Reneo Pharmaceuticals, Inc. (“Reneo”) under the laws of the State of Delaware. On October 4, 2024, the Company changed its name to OnKure Therapeutics, Inc. Liquidity and Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company had recurring losses and negative cash flows from operations, an accumulated deficit of $ 214.2 million , and cash and cash equivalents of $ 59.1 million as of December 31, 2025. Due to the current status of the clinical program, the anticipated costs to be incurred for existing operations as well as exploring other corporate strategic alternatives, and the uncertainty of the Company's ability to raise a significant amount of capital, the Company determined that it does not have sufficient funds to meet its obligations through at least the next 12 months from the issuance of these financial statements. As a result, substantial doubt exists about the Company’s ability to continue as a going concern. The Company could delay or cancel certain planned expenditures related to its drug development programs and/or implement cost reduction measures to conserve its cash balances; however, there is no assurance that those measures would be adequate to allow the Company to continue as a going concern for a period beyond one year from the issuance of these financial statements. On November 6, 2025, we filed a shelf registration statement on Form S-3 that allows us to undertake various equity and debt offerings. Additionally, the Company filed a prospectus supplement to the shelf registration statement and entered into a sales agreement (“Sales Agreement”) with Leerink Partners LLC (“Leerink Partners”) under which the Company may offer and sell shares (the “Placement Shares”) of the Company’s Class A common stock, $ 0.0001 par value per share (the “Common Stock”), from time to time having aggregate sales proceeds of up to $ 16.0 million, through an “at the market offering” program (“ATM”) under which Leerink Partners will act as sales agent. The Company has not yet offered or sold any shares of common stock related to the ATM. The Company’s ability to secure capital is dependent upon success in discovering and developing its drug candidates. The Company cannot provide assurance that additional capital will be available on acceptable terms, if at all. The issuance of additional equity or debt securities will likely result in substantial dilution to the Company’s stockholders. Should additional capital not be available to the Company in the near term, or not be available on acceptable terms, the Company may be unable to realize value from the Company’s assets or discharge liabilities in the normal course of business, which may, among other alternatives, cause the Company to delay, substantially reduce, or discontinue operational activities to conserve cash, which could have a material adverse effect on the Company’s ability to achieve its intended business objectives. Changing circumstances, including due to macroeconomic and geopolitical effects outside of the Company’s control, may cause the Company to consume capital significantly faster or slower than currently anticipated. The Company's estimates are based on assumptions that may prove to be wrong, and the Company could exhaust its available financial resources sooner than currently anticipated. Accordingly, failure to raise capital as and when needed, on favorable terms or at all, would have a negative impact on the Company’s financial condition and its ability to discover and develop its product candidates. The consolidated financial statements do not include any adjustments relating to the recoverability and reclassification of assets and liabilities that might be necessary if the Company is unable to continue as a going concern. 101 Merger with Reneo On October 4, 2024, Radiate Merger Sub I, Inc. (“Merger Sub I”) a wholly-owned subsidiary of Reneo completed its merger with and into OnKure, Inc. (referred to herein as “Legacy OnKure”), with Legacy OnKure continuing as the surviving entity as a wholly-owned subsidiary of Reneo. This transaction is referred to as the “Merger.” Following the Merger, Reneo changed its name to OnKure Therapeutics, Inc. Legacy OnKure remains as a wholly-owned subsidiary of the Company, and, together with the Company, is referred to as the “Combined Company” below. The Merger was effected pursuant to an Agreement and Plan of Merger, dated as of May 10, 2024 (the “Merger Agreement”), by and among Reneo, Radiate Merger Sub I, Inc., a Delaware corporation Radiate Merger Sub II, LLC, a Delaware limited liability company (“Merger Sub II”), and Legacy OnKure. In connection with the Merger Agreement, certain parties entered into a subscription agreement with the Company to purchase shares of Reneo’s common stock for an aggregate purchase price of $ 65.0 million contingent upon the concurrent consummation of the Merger (the “Concurrent Financing”). On October 4, 2024 (the “Closing Date”), the Merger and the Concurrent Financing closed . The Merger was accounted for as a reverse recapitalization in accordance with accounting principles generally accepted in the United States of America (“GAAP”). For accounting purposes, Legacy OnKure is considered the accounting acquirer and Reneo is the acquired company based on the terms of the Merger Agreement and other factors, such as relative voting rights and the composition of the Company’s board of directors and senior management. Accordingly, the Merger was treated as the equivalent of Legacy OnKure issuing stock to acquire the net assets of Reneo. As a result of the Merger, the net assets of Reneo were recorded at their acquisition-date fair value in the financial statements of the Combined Company and the reported operating results prior to the Merger are those of Legacy OnKure. Legacy OnKure’s historical financial statements became the historical consolidated financial statements of the Combined Company. All issued and outstanding Legacy OnKure common stock, convertible preferred stock, restricted stock units, and options to purchase common stock prior to the effective date of the Merger have been retroactively adjusted to reflect the exchange ratio for all periods presented . See Note 3 for further discussion. Risks and Uncertainties The board of directors of the Company discusses with management macroeconomic and geopolitical developments, including inflation, instability in the banking and financial services sector, tightening of the credit markets, international conflicts, cybersecurity, and sanctions so that the Company can be prepared to react to new developments as they arise. The board of directors and the management of the Company are carefully monitoring these developments and the resulting economic impact on its financial condition and results of operations . 2. Summary of Significant Accounting Policies Basis of Presentation and Consolidation The Company’s consolidated financial statements are prepared in accordance with GAAP and reflect the operation of the Company and its former wholly-owned subsidiaries, OnKure, Inc. and Merger Sub II. As of December 31, 2025, all subsidiaries have been merged into the Company. All intercompany balances and transactions among the consolidated entities have been eliminated in consolidation. Segment Information The Company operates in one operating segment: clinical research. All equipment and other property and equipment are physically located within the United States . Use of Estimates The preparation of the Company’s consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and contingent liabilities at the date of the consolidated financial statements, and the reported amounts of expenses during the reporting period. Although these estimates are based on the Company’s knowledge of current events and actions it may take in the future, actual results may ultimately differ from these 102 estimates. The most significant estimates relate to external research and development expenses, and the fair value of stock options and restricted stock units . Comprehensive Loss Comprehensive loss is defined as a change in equity during a period from transactions and other events and circumstances from non-owner sources. The Company’s comprehensive loss was the same as its reported net loss for all periods presented. Research and Development Expenses Research and development (“R&D”) costs are expensed as incurred in performing research and development activities. The costs include employee-related expense, including salaries, severance, benefits, share-based compensation, costs of research and development activities conducted by third parties on the Company’s behalf, costs to have clinical trial materials manufactured, fees for acquiring and maintaining licenses under third-party license agreements, consulting fees, depreciation, and facilities and overhead costs . Accrued Research and Development Expenses The Company records research and development expenses in the period in which it receives or takes ownership of the applicable goods or when the applicable services are performed. The Company is required to estimate its expenses resulting from its obligations under contracts with vendors, consultants, and contract research organizations, in connection with conducting research and development activities. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided under such contracts. The Company reflects research and development expenses in its consolidated financial statements by matching those expenses with the period in which services and efforts are expended. The Company accounts for these expenses according to the progress of the preclinical studies or clinical trials, as measured by the timing of various aspects of the study or related activities. The Company determines accrual estimates through a review of the underlying contracts along with the preparation of financial models considering discussions with research and other key personnel as to the progress of studies, trials, or other services being conducted. During a study or trial, the Company adjusts its rate of expense recognition if actual results differ from its estimates. Nonrefundable advance payments for goods and services, including fees for process development or manufacturing and distribution of clinical supplies that will be used in future research and development activities, are deferred and recognized as an expense in the period that the related goods are consumed, or services are performed. Patent Costs The Company expenses all costs as incurred in connection with patent applications (including direct application fees and the legal and consulting expenses related to making such applications) and such costs are included in general and administrative expenses in the statements of operations and comprehensive loss. Share-Based Compensation The Company maintains an equity incentive compensation plan under which incentive stock options and nonqualified stock options to purchase common stock, and restricted stock units for common stock, are granted to employees, board of directors, and non-employee consultants. Stock-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as expense over the requisite service or performance period. The fair value of stock options granted to employees is estimated using the Black-Scholes option pricing model. The Black-Scholes valuation method requires certain assumptions be used as inputs, such as the fair value of the underlying common stock, expected term of the option before exercise, expected volatility of the Company’s common stock, risk-free interest rate and expected dividend. Options granted have a maximum contractual term of 10 years. The Company has limited historical stock option activity and therefore estimates the expected term of stock options granted using the simplified method, which represents the arithmetic average of the original contractual term of the stock option and its weighted-average vesting term. The expected volatility of stock options is based on the historical volatility of several publicly traded companies in similar stages of clinical development. The Company will continue to apply this process until enough historical information regarding the volatility of its stock price becomes available. The risk-free interest rates used are based on the U.S. Treasury yield in effect at the 103 time of grant for zero-coupon U.S. treasury notes with maturities approximately equal to the expected term of the stock options. The Company has historically not declared or paid any dividends and does not currently expect to do so in the foreseeable future, and therefore has estimated the dividend yield to be zero. (See Note 11). The Company recognizes stock-based compensation expense for grants under its various Equity Incentive Plans and employee stock purchase plan (“ESPP” ). The Company accounts for all stock-based awards granted to employees and directors at their fair value and recognizes compensation expense over the award’s vesting period. Determining the amount of stock-based compensation to be recorded requires the Company to develop estimates of fair values of stock options as of the grant date. The Company calculates the grant date fair values of stock options using the Black-Scholes valuation model, which requires the input of subjective assumptions, including but not limited to expected stock price volatility over the term of the awards and the expected term of stock options. The fair value of restricted stock awards granted to employees is based on the quoted closing market price per share on grant date. Fair Value of Financial Instruments The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. The carrying amounts of the Company’s financial assets and liabilities, such as cash, receivables, prepaid and other current assets, accounts payable, and accrued expenses approximate their fair values because of the short maturity of these instruments. Cash and Cash Equivalents All highly liquid investments with maturities of 90 days or less, at the time of purchase, are classified as cash equivalents. Cash equivalents are reported at cost, which approximates fair value. The Company’s cash and cash equivalents consist of money held in demand depository accounts and money market funds. The carrying amount of cash and cash equivalents was $ 59.1 million and $ 110.8 million as of December 31, 2025, and 2024, respectively, which approximates fair value and was determined based upon Level 1 inputs. The money market account is valued using quoted market prices with no valuation adjustments applied and is categorized as Level 1 . Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. The Company maintains accounts in federally insured financial institutions above federally insured limits of $ 250,000 as of December 31, 2025 and 2024. Management believes the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which these deposits are held and of the money market funds in which these investments are made . Deferred Offering Costs The Company capitalizes certain legal, professional, accounting and other third-party fees that are directly associated with in-process equity issuances as deferred offering costs until such equity issuances are consummated. After consummation of the equity issuance, these costs are recorded as a reduction in the capitalized amount associated with the equity issuance. Should the equity issuance be abandoned, the deferred offering costs are expensed immediately as a charge to operating expenses in the statement of operations. Deferred offering costs as of December 31, 2025 were $ 0.2 million . There were no deferred offering costs as of December 31, 2024. Such costs are classified in other non-current assets in the accompanying balance sheets. Property and Equipment, Net The Company carries its property and equipment at cost, less accumulated depreciation, amortization and impairment, if any. Expenditures for renewals or betterments that materially extend the useful life of an asset or increase its productivity, such as leasehold improvements, are capitalized. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally between three to seven years . Leasehold improvements are amortized over the shorter of the life of the lease (including any renewal periods that are deemed to be reasonably assured) or the estimated useful life of the assets . Repair and maintenance costs are expensed as incurred and expenditures for major improvements are capitalized . 104 Impairment of Long-Lived Assets The Company assesses the carrying amount of its property and equipment whenever events or changes in circumstances indicate the carrying amount of such assets may not be recoverable. No impairment charges were recorded during the years ended December 31, 2025 and 2024 . Leasing – Lessee Accounting The Company determines if an arrangement is a lease at inception. The Company’s operating lease agreements are primarily for office space and research labs. For operating leases with a term greater than one year, the Company recognizes the right-of-use (“ROU”) assets and lease liabilities related to the lease payments on its balance sheet. The lease liabilities are initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. The ROU assets represent the Company’s right to use the underlying assets for the term of the lease and the lease liabilities represent the Company’s obligation to make lease payments arising for the agreements. ROU assets are initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date, plus any initial direct costs incurred less any lease incentives received. The ROU asset is periodically reviewed for impairment unless a triggering event occurs. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Variable lease payments, except for the ones that depend on index or rate, are excluded from the calculation of the ROU assets and lease liabilities and are recognized as variable lease expense in the statements of operations and comprehensive loss in the period in which they are incurred. Sublease inflows are netted against the respective lease outflows. As the interest rate implicit in the Company’s leases is not readily determinable, the Company uses its estimated incremental borrowing rate in its present value calculations. One of the Company’s lessee agreements include an option to extend the lease, which the Company does not include in its minimum lease term unless it is reasonably certain to exercise such option. Operating leases with a term of less than one year are recognized as a lease expense over the term of the lease, with no asset or liability recognized on the balance sheet. Income Taxes Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and consist of taxes currently payable and deferred taxes. The Company accounts for income taxes using the asset and liability method of accounting for deferred income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and operating losses and tax credit carryforwards. A valuation allowance is recorded to the extent it is more likely than not that some portion of a deferred tax asset will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. The Company’s significant deferred tax assets are net operating loss carryforwards, tax credits, and accruals. The Company has provided a valuation allowance equal to its net deferred tax assets since inception as, due to its history of operating losses, the Company has concluded that it is more likely than not that most of its deferred tax assets will not be realized. Accounting for uncertain tax positions requires a more likely than not threshold for recognition in the consolidated financial statements. The Company recognizes a tax benefit based on whether it is more likely than not that a tax position will be sustained. The Company records a liability to the extent that a tax position taken or expected to be taken on a tax return exceeds the amount recognized in the consolidated financial statements. The Company has no unrecognized tax benefits as of December 31, 2025 and 2024. The Company classifies interest and penalties arising from the underpayment of income taxes in the statements of operations as general and administrative expenses. No such expenses have been recognized during the years ended December 31, 2025 and 2024. The Company is subject to taxation in the United States and the United Kingdom (“UK”). As of December 31, 2025 , the Company’s tax years since inception are subject to examination by taxing authorities in the United States, and the UK tax returns from 2018 forward are subject to examination. 105 Recently Adopted Accounting Pronouncemen ts In December 2023, the FASB issued ASU 2023-09 , Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which requires enhanced income tax disclosures, including specific categories and disaggregation of information in the effective tax rate reconciliation, disaggregated information related to income taxes paid, income or loss from continuing operations before income tax expense or benefit, and income tax expense or benefit from continuing operations. The requirements of the ASU are effective for annual periods beginning after December 15, 2024, with early adoption permitted. This ASU was adopted retrospectively for the year ended December 31, 2025 and the disclosures related to this ASU are in Note 12 below. Recently Issued Accounting Pronouncemen ts In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses . This ASU requires more detailed disclosures, on an annual and interim basis, about specified categories of expenses (including employee compensation, depreciation, and amortization) included in certain expense captions presented on the face of the income statement. This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. This ASU may be applied either prospectively or retrospectively. The Company is currently evaluating the impact of this pronouncement. In December 2025, the FASB issued ASU 2025-11 Interim Reporting (Topic 270): Narrow-Scope Improvements. This standard clarifies current interim reporting requirements on Topic 270 and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. This standard will be effective for fiscal years beginning after December 15, 2027, with the option to apply it retrospectively. Early adoption is allowed. The Company is currently assessing the potential impact of this guidance on its consolidated financial statement disclosures. The Company continues to monitor new accounting pronouncements issued by the FASB and does not believe any accounting pronouncements issued through the date of this report will have a material impact on its consolidated financial statements. 3. Merger Agreement and Concurrent Financing As described in Note 1, Merger Sub I merged with and into Legacy OnKure, with Legacy OnKure surviving as a wholly-owned subsidiary of the Company on October 4, 2024. At the Closing, each then-outstanding share of Legacy OnKure common stock was converted into the right to receive 0.023596 shares of common stock of Reneo based on the Common Exchange Ratio, which was reclassified as Class A Common Stock in connection with the Merger, and each then-outstanding share of Legacy OnKure preferred stock was converted into the right to receive 0.144794 shares of Class A Common Stock based on the Preferred Exchange Ratio; provided that one holder of Legacy OnKure preferred stock elected to receive 686,527 shares that it would otherwise have received in the form of Class A Common Stock in an equal number of shares of Class B Common Stock. Upon the closing of the Merger, (i) an aggregate of 6,470,281 shares of Class A Common Stock and 686,527 shares of Class B Common Stock of Reneo were issued in exchange for the shares of Legacy OnKure capital stock outstanding as of immediately prior to the Closing and (ii) outstanding shares of Reneo common stock were reclassified into an aggregate of approximately 3,343,604 shares of Class A Common Stock. In connection with the Merger Agreement, Reneo entered into a subscription agreement with certain investors, pursuant to which the investors subscribed for and purchased, concurrent with the closing of the Merger, an aggregate of 2,839,005 shares of Class A Common Stock at a price of approximately $ 22.895 per share for aggregate gross proceeds of approximately $ 65.0 million, including the conversion of previously funded Convertible Promissory Notes principal of $ 6.0 million and accrued interest there on of $ 120 thousand, on October 4, 2024. At the effective time of the Merger, the authorized shares of Class A Common Stock of the Company were 200,000,000 with par value of $ 0.0001 and Class B Common Stock of the Company were 10,000,000 with par value of $ 0.0001 . The Merger was accounted for as a reverse recapitalization in accordance with GAAP, with Legacy OnKure as the accounting acquirer of Reneo. Legacy OnKure was determined to be the accounting acquirer based 106 on the terms of the Merger Agreement and other factors, such as relative voting rights and the composition of the combined company’s board of directors and senior management. As a result, Legacy OnKure’s historical financial statements became the historical consolidated financial statements of the combined company for accounting purposes together with a deemed issuance of shares, equivalent to the shares held by the former stockholders of Reneo, the legal acquirer, and a recapitalization of the equity of Legacy OnKure, the accounting acquirer. The final transaction amounts have been recorded as a reduction of proceeds in stockholders' equity. At the effective time of the Merger, the net assets of Reneo were recorded at their acquisition-date fair value in the consolidated financial statements of the combined company, which approximated book value due to the short-term nature. Reneo’s development programs had ceased prior to the Merger and were deemed to be de minimis in value at the transaction date. No goodwill or intangible assets were recognized. As part of the recapitalization, excluding the Concurrent Financing, the Company acquired the assets and liabilities listed below (in thousands): Amount Cash and cash equivalents $ 57,736 Short-term investments 15,979 Other current assets 690 Other assets 553 Accrued expenses ( 9,072 ) Long-term operating lease liability ( 387 ) Net assets acquired $ 65,499 4. Segment The Company is a publicly listed company focused on the development of clinical and pre-clinical product candidates with a single reportable segment: clinical research. The accounting policies of the clinical research segment are the same as those described in the summary of significant accounting policies . The Company has yet to generate revenue and anticipates substantial expenses and operating losses as it advances its product candidates through clinical trials and regulatory processes. The Company’s Chief Operating Decision Maker (“CODM”) is the senior executive committee that is comprised of the Chief Executive Officer and the Chief Financial Officer . The CODM assesses financial performance primarily using operating expenses as reported on the statement of operations, supplemented by internal budget and forecast models to guide resource allocation and performance evaluation. Segment assets are reported as total assets on the Company’s consolidated balance sheet, and segment loss is reflected as net loss in the Company’s consolidated statements of operations and comprehensive loss, effectively mirroring the Company’s 107 overall financial position due to its single-segment structure. The Company does not have intra-entity sales or transfers . Clinical Research Segment 2025 2024 (in thousands) Operating expenses: Direct program expense $ 28,373 $ 27,398 Indirect program expense 1,923 2,157 Workforce salaries and benefits 16,301 15,102 Share-based compensation expense 11,633 4,530 General corporate expenses 4,720 5,199 Interest and other expense 8 300 Segment net loss 62,958 54,686 Reconciliation of loss: Interest income ( 3,441 ) ( 2,013 ) Adjustments and reconciling items ( 3,441 ) ( 2,013 ) Net loss $ 59,517 $ 52,673 5. Leases The Company’s headquarters are located in Boulder, Colorado, where it leases 14,790 square feet of office and lab facilities under operating leases that expire in December 2026 , with rights to extend for a five-year period . In the Merger with Reneo, the Company assumed the lease in Irvine, California, where it leases office space under a lease agreement that expires in November 2026 (“Irvine lease”). In January 2025, the Company entered into a sublease on the Irvine lease for all of the leased square footage, which expires in November 2026. Payments received under the sublease for the year ended December 31, 2025 were $ 231 thousand and were netted against operating lease costs in the Statement of Operations. Right-of-use assets and lease liabilities for operating leases as included in the Company’s consolidated financial statements are as follows (in thousands): December 31, 2025 December 31, 2024 Operating lease right-of-use assets $ 387 $ 770 Current operating lease liabilities 549 536 Noncurrent operating lease liabilities — 549 Total lease liabilities $ 549 $ 1,085 Lease expense for operating leases , net of sublease receipts, as included in the Company’s consolidated financial statements are as follows (in thousands): December 31, 2025 2024 Operating lease cost $ 187 $ 236 Variable lease expense 162 187 108 Lease term, discount rates, and additional information for operating leases are as follows (in thousands): As of December 31, 2025 2024 Weighted-average remaining lease term - operating leases (years) 0.87 1.87 Weighted-average discount rate - operating leases 4.5 % 4.5 % Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 571 $ 315 The aggregate maturities of the Company’s operating lease liabilities were as follows as of December 31, 2025 (in thousands): 2026 $ 560 Total future minimum lease payments 560 Less: imputed interest ( 11 ) Less: current portion ( 549 ) Operating lease liability, net of current portion $ — 6. Net Loss Per Share The Company computes basic loss per share by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net loss per share assumes the conversion, exercise or issuance of all potential common stock equivalents, unless the effect of inclusion would be anti-dilutive. For purposes of this calculation, common stock shares to be issued upon if-converted method for the convertible Series C Preferred Stock, if-converted method for the convertible promissory note, exercise of all outstanding stock options and restricted stock units were excluded from the diluted net loss per share calculation for the year ended December 31, 2024 because such shares are anti-dilutive. Common stock shares to be issued upon exercise of all outstanding stock options and restricted stock units were excluded from the diluted net loss per share calculation for the year ended December 31, 2025 because such shares are anti-dilutive. Anti-dilutive securities outstanding during the period not included in the diluted net loss per share calculation include the following : December 31, 2025 2024 Outstanding common stock options 2,714,651 2,393,824 Unvested restricted stock units 41,376 213,254 Unreleased restricted stock units assumed in the Merger — 17,000 Convertible Series C Preferred Stock — 5,191,375 Convertible Promissory Notes — 149,650 2,756,027 7,965,103 7. Fair Value Measurements ASC Topic 820, Fair Value Measurement , establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are inputs that market participants would use in pricing an asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. 109 ASC Topic 820 identifies fair value as the exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, ASC Topic 820 establishes a three-tier fair value hierarchy that distinguishes between the following: • Level 1 – Observable inputs such as quoted prices in active markets for identical assets or liabilities. • Level 2 – Inputs, other than quoted prices in active markets, which are observable for the asset or liability, either directly or indirectly. • Level 3 – Unobservable inputs in which there is little or no market data, which requires the Company to develop its own assumptions. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. The Company’s financial assets are subject to fair value measurements on a recurring basis. The Company categorizes its money market funds as Level 1, using the quoted prices in active markets. The fair value of the Company’s investments in certain money market funds is their face value and such instruments are classified as Level 1 and are included in cash and cash equivalents on the consolidated balance sheets. No assets or liabilities were transferred into or out of their classifications during the years ended December 31, 2025 and 2024. As part of the Merger, the Company acquired certain short-term investments in debt securities that were carried at fair value and classified as current assets available-for-sale and represented the investment of funds available for current operations. During the year ended December 31, 2024, the Company sold these short-term investments for proceeds of $ 15.9 million which resulted in a realized loss of approximately $ 54,000 . The Company had no available-for-sale securities as of December 31, 2025 or 2024 . 8. Property and Equipment, Net Property and equipment, net, consisted of the following (in thousands): December 31, 2025 December 31, 2024 Lab equipment $ 669 $ 705 Leasehold improvements 1,090 1,090 Computer hardware and software 168 189 Furniture and fixtures 152 160 Property and equipment, gross 2,079 2,144 Less: accumulated depreciation and amortization ( 1,461 ) ( 1,119 ) Property and equipment, net $ 618 $ 1,025 Depreciation and amortization expense for the years ended December 31, 2025 and 2024 was $ 447 thousand and $ 459 thousand , respectively . 110 9. Accrued Expenses Accrued expenses consisted of the following (in thousands): December 31, 2025 December 31, 2024 Accrued compensation and ESPP contributions $ 2,693 $ 3,173 Accrued outsourced studies 651 516 Accrued contract manufacturing costs 223 1,565 Accrued clinical trial costs 49 1,302 Accrued other 323 470 Total accrued expenses and other current liabilities $ 3,939 $ 7,026 Accrued compensation as of December 31, 2024 included severance costs. For further information see Note 13. 10. Equity Common Stock The Company is authorized to issue 210,000,000 shares of common stock, of which 200,000,000 shares have been designated as Class A Common Stock and 10,000,000 shares have been designated as Class B Common Stock, both with a par value of $ 0.0001 per share. The number of authorized shares of common stock may be increased or decreased by the affirmative vote of the holders of a majority of the Company’s stock who are entitled to vote. Each share of Class A Common Stock is entitled to one vote. Class B Common Stock is not entitled to vote on any matter on which the holders of Class A Common Stock or Preferred Stock are entitled to vote. All holders of common stock are entitled to receive dividends when and as declared or paid by the Company’s board of directors, subject to the preferential rights of the holders of preferred stock. Class B Common Stock is convertible into a corresponding number of shares of Class A Common Stock upon written notice of the holder, subject to defined beneficial ownership limitations. In 2025, all 686,527 shares of Class B Common Stock were converted to Class A Common Stock at the election of the holder. Preferred Stock The Company is authorized to issue 10,000,000 shares of preferred stock, with a par value of $ 0.0001 per share. As of December 31, 2025 , no ne of these shares of preferred stock has been designated or issued. Sale of Common Stock Under ATM Agreement On November 6, 2025, the Company entered into a Sales Agreement with Leerink Partners to sell shares (the “Placement Shares”) of the Company’s Class A common stock, $ 0.0001 par value per share (the “Common Stock”), from time to time, through an “at the market offering” program under which Leerink Partners will act as sales agent. Under the Sales Agreement, the Company will set the parameters for the sale of Placement Shares, including the maximum number or dollar amount of Placement Shares to be sold, the time period during which sales are requested to be made, any limitation on the number or dollar amount of Placement Shares that may be sold in any one trading day, and any minimum price below which sales may not be made. Subject to the terms and conditions of the Sales Agreement, unless otherwise specified by the Company, Leerink Partners may sell Placement Shares by any method permitted by law deemed to be an “at-the-market offering” as defined in Rule 415 of the Securities Act of 1933, as amended, including sales made directly on or through the Nasdaq Global Market, on or through any other existing trading market for the Common Stock or to or through a market maker. If expressly authorized by the Company, the Leerink Partners may also sell Placement Shares in negotiated transactions. Leerink Partners has agreed to use commercially reasonable efforts consistent with its normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of The Nasdaq Stock Market LLC to sell such Placement Shares up to the number or amount specified in, and otherwise in accordance with, the terms of a placement notice given to Leerink Partners. As specified in the Sales Agreement, the Sales Agreement may be terminated by the Company upon 10 days’ prior notice to Leerink Partners in its sole discretion at any time, or by Leerink Partners upon 10 days’ prior notice to the Company in its sole discretion at any time or immediately upon 111 notice to the Company under certain circumstances, including in the event of a material adverse change in the Company. The Sales Agreement provides that Leerink Partners will be entitled to compensation for its services of up to 3.0 % of the gross proceeds from the sales of Placement Shares through Leerink Partners under the Sales Agreement. The Company has no obligation to sell any Placement Shares under the Sales Agreement, and may at any time suspend sales of shares under the Sales Agreement. The Sales Agreement contains customary representations, warranties, and agreements by the Company, indemnification obligations of the Company and Leerink Partners, other obligations of the parties, and termination provisions. On November 6, 2025, the Company filed a shelf registration statement with the SEC on Form S-3, which became effective with the SEC on November 25, 2025 (the “Registration Statement” ). The Registration Statement registered an aggregate of up to $ 200 million of securities that may be issued and sold by the Company from time to time, including initially up to an aggregate offering price of $ 16.0 million of common stock (which is included in the $ 200 million aggregate offering price set forth in the base prospectus) that may be issued and sold pursuant to the Sales Agreement. The Company has no t issued any common shares pursuant to the Sales Agreement. 11. Share-Based Compensation The Company's share-based compensation plans are described below: 2024 Equity Incentive Plan In October 2024, the Company established an equity incentive plan (the “2024 Plan”). The 2024 Equity Incentive Plan became effective upon the closing of the Merger, and will continue in effect for a period of ten years from its effectiveness, unless terminated earlier by the administrator. The 2024 Plan provides for the grant of stock options, restricted stock units (“RSUs”) and restricted stock awards (“RSAs”) to employees, non-employee directors, advisors, and consultants. Under the 2024 Plan a total of 2,480,000 shares of Class A Common Stock were initially reserved for issuance. In addition, shares reserved for issuance under the 2024 Plan will include shares of Class A Common Stock equity awards granted under the Reneo 2021 Plan and any shares of Class A Common Stock equity awards that were assumed in the Merger. As of the effective date of the 2024 Plan, awards granted under the 2011, 2021 and 2023 Plans that are forfeited or otherwise become available will be included and available for issuance under the 2024 Plan. Under the 2024 Plan, the Company may grant stock options, stock appreciation rights, restricted stock awards, restricted stock units, and other awards to individuals who are employees, officers, directors or consultants of the Company and its affiliates. The Company issues new shares in settlement of equity awards under the 2024 Plan. See Note 15 for discussion of the increase to the available for issuance as of January 1, 2026. 2023 RSU Equity Incentive Plan In September 2023, Legacy OnKure established an equity incentive plan (the “2023 Plan”). The 2023 Plan provided for the grant of RSUs to employees, directors, and consultants. Upon the close of the Merger, all shares available for issuance under the 2023 Plan were cancelled. 2021 Equity Incentive Plan In February 2021, Legacy OnKure established an equity incentive plan (the “2021 Plan”). The 2021 Plan provided for the grant of stock options and RSA to employees, non-employee directors, advisors, and consultants. Upon the close of the Merger, all shares available for issuance under the 2021 Plan were cancelled.  2011 Equity Incentive Plan In October 2011, Legacy OnKure established an equity incentive plan (the “2011 Plan”). The 2011 Plan provided for the grant of stock options and RSAs to employees, non-employee directors, advisors, and consultants. Shares are no longer available for issuance under the 2011 Plan, which was subsequently terminated in March 2023. Upon the close of the Merger, all shares available for issuance under the 2011 Plan were cancelled. 112 In addition, as part of the Merger with Reneo discussed in Note 1, the Company assumed outstanding awards under the following Reneo Equity Incentive Plans and certain awards not issued pursuant to a Reneo Equity Plan: Reneo 2021 and 2014 Equity Incentive Plans In March 2021, the Reneo Board of Directors adopted the Reneo 2021 Equity Incentive Plan (“Reneo 2021 Plan”), which is the successor to Reneo’s 2014 Equity Incentive Plan and UK Sub-Plan (“2014 Plan”). ESPP In October 2024, the Company established the ESPP. Under the ESPP, eligible employees can purchase common stock through scheduled payroll deductions. The purchase price is equal to the closing price of our common stock on the first or last day of the offering period (whichever is less), minus a 15 % discount. The Company uses the Black-Scholes option-pricing model, in combination with the discounted employee price, in determining the value of ESPP expense to be recognized during each offering period. Contributions under the ESPP are limited to 15 % of an employee’s eligible compensation, Internal Revenue Service limitations, and a maximum of 4,000 shares during each offering period . As of December 31, 2025, an aggregate of 163,041 shares of Class A Common Stock are currently reserved and available for issuance under the ESPP. See Note 15 for discussion of the increase to the available for issuance as of January 1, 2026. Shares Reserved for Future Issuance As of December 31, 2025, the Company had reserved shares of its common stock for future issuance as follows: Shares Reserved Common stock options outstanding 2,714,651 Unvested restricted stock units under the 2023 Plan 41,376 Available for future grants under the 2024 Plan 868,712 Available for future grants under the ESPP 163,041 Total shares of common stock reserved for future issuance 3,787,780 Stock Options Options granted under the Company’s equity incentive plans have an exercise price equal to or in excess of the market value of the Class A Common Stock at the date of grant and expire no more than 10 years from the date of grant. Generally, options become exercisable ratably over a period of three to four years from the date of grant. Stock options granted to non-employees generally vest quarterly over two to three years . 113 A summary of the Company’s stock option activity and related information for the year ended December 31, 2025 is as follows: Options Outstanding Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Options outstanding - December 31, 2024 2,393,824 $ 23.54 7.90 $ 1 Granted 774,800 4.98 Exercised — — Expired ( 405,567 ) 42.88 Forfeited ( 48,406 ) 13.27 Options outstanding - December 31, 2025 2,714,651 $ 15.54 8.52 $ 22 Options exercisable - December 31, 2025 1,032,822 $ 19.05 7.95 $ — All outstanding options as of December 31, 2025 are expected to vest. As of December 31, 2025, the Company had unrecognized compensation cost for unvested stock options of $ 19.9 million , expected to be recognized over a weighted-average period of approximately 2.1 years. The aggregate intrinsic value is calculated as the difference between the exercise price and the estimated fair value of the Company’s common stock as of December 31, 2025. The weighted-average grant-date fair value of options granted for the years ended December 31, 2025, and 2024 was $ 4.50 and $ 16.05 , respectively. The Company granted 8,449 performance-based shares, which are included in the table above, during the year ended December 31, 2023 . The Company recognized $ 0 and $ 30,000 in performance-based compensation expense for the years ended December 31, 2025 and 2024, respectively. The Company estimates stock awards fair value on the date of grant using the Black-Scholes valuation, with the vesting being subject to service requirements. The Company accounts for forfeitures when they occur. The weighted-average assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option grants were as follows: Year Ended December 31, 2025 2024 Expected term (years) 5.99 5.77 Expected volatility 130.1 % 126.2 % Risk-free interest rate 4.34 % 3.80 % Expected dividend yield 0 % 0 % Risk-free interest rate. The Company bases the risk-free interest rate assumption on the U.S. Treasury’s rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. Expected volatility. The expected volatility assumption was based on the volatilities of a peer group of similar companies whose share prices are publicly available. The peer group was developed based on companies in the biotechnology industry. Expected term. The expected term represents the period of time that options are expected to be outstanding. Because the Company does not have historical exercise behavior, it determines the expected life assumption using the simplified method, which is an average of the contractual term of the option and its vesting period. 114 Expected dividend yield. The Company bases the expected dividend yield assumption on the fact that it has never paid cash dividends and has no present intention to pay cash dividends. Restricted Stock Units (RSUs) RSUs vest based on a service-based requirement and a liquidity event plus service requirement. The following table summarizes RSU activities during the year ended December 31, 2025: Number of Shares Weighted Average Grant Date Fair Value Unvested balance as of December 31, 2024 213,254 $ 22.88 Granted 35,893 2.94 Vested and released ( 205,999 ) 19.41 Forfeited ( 1,772 ) 22.89 RSUs outstanding - December 31, 2025 41,376 $ 22.89 Unvested balance as of December 31, 2025 41,376 $ 22.89 As of December 31, 2025, the Company had unrecognized compensation cost for unvested RSU awards of $ 1.6 million , expected to be recognized over a weighted-average period of approximately 1.2 years. During the year ended December 31, 2025, 4,481 shares were used to settle grantee's tax withholding obligations for vesting of restricted stock units. In addition to the RSUs in the table above, in connection with the Merger, the Company assumed 24,700 RSUs which were fully vested at the time of the Merger. The RSUs were releasable upon set time frames after completion of the Merger. The 17,000 RSUs that were unreleased as of December 31, 2024 were released in January 2025. 2024 Employee Stock Purchase Plan In October 2024, the Company’s Board of Directors adopted the ESPP, which became effective immediately upon completion of the Merger with Reneo. During the year ended December 31, 2025, a total of 107,930 shares of common stock were issued under the ESPP at a weighted-average per share price of $ 2.23 . Share-Based Compensation Expense The following table shows the allocation of share-based compensation expense related to the company’s share-based awards and employee stock purchase plan (in thousands) : December 31, 2025 2024 Research and development $ 5,636 $ 2,896 General and administrative 5,997 1,634 Total $ 11,633 $ 4,530 The Company recorded accelerated share-based compensation expenses related to modifications of RSUs under certain separation agreements of $ 1.7 million during the year ended December 31, 2024, which is reflected in the above table. See Note 13 for further discussion on severance. There were no such modifications during the year ended December 31, 2025 . 12. Income Taxes Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be recovered or settled. 115 No income taxes were paid to any jurisdiction for the years ended December 31, 2025 or 2024. All losses from continuing operations consisted of U.S. domestic for the years ended December 31, 2025 and 2024. The components of the income tax benefit are as follows: Years ended December 31, 2025 2024 Amount Percent Amount Percent Federal tax at statutory rate ($ 12,499 ) 21.0 % ($ 11,061 ) 21.0 % State taxes, net of federal deduction* ( 1,997 ) 3.4 % ( 1,697 ) 3.2 % Effect of Changes in Tax Laws or Rates Enacted in the Current Period ( 39 ) 0.0 % — 0.0 % Tax Credits R&D credits — 0.0 % ( 45 ) 0.1 % Non-deductible Items Stock based compensation 917 ( 1.5 )% 193 ( 0.4 )% Other 3 0.0 % 9 0.0 % Other Adjustments ( 13,414 ) 22.5 % 988 ( 1.9 )% Change in valuation allowance 27,029 ( 45.4 )% 11,613 ( 22.0 )% Income tax benefit $ 0 0.0 % $ 0 0.0 % * State taxes in Colorado for 2025 and 2024 made up the majority (greater than 50%) of the tax effect in this category. Significant components of deferred income taxes are as follows (in thousands): As of December 31, 2025 2024 Deferred tax assets: Net operating loss carryforwards $ 58,177 $ 53,984 R&D tax credit 19,363 837 Deferred R&D expenses 36,095 32,729 Accrued expenses 840 1,903 Share-based compensation 2,423 978 Intangible assests 7,005 424 Other 91 — Total deferred tax assets 123,994 90,855 Valuation allowance ( 123,994 ) ( 90,855 ) Deferred tax assets, net of valuation allowance — — As of December 31, 2025 , the Company had approximately $ 3.0 million of net operating loss carryforwards (“NOLs”) and $ 0.8 million of research and experimental credits which expire through 2037 , and approximately $ 233.5 million of federal and state net operating loss carryforwards which have an indefinite life. At December 31, 2025 , the Company had federal and state tax credit carry forwards of approximately $ 18.5 million. The Company has not performed a formal research and development credit study with respect to these credits. The federal credits will begin to expire in 2034 , if unused. Pursuant to Internal Revenue Code (“IRC”) Sections 382 and 383, the Company’s ability to use NOLs and research tax credit carry forwards to offset future taxable income may be limited if the Company experiences a cumulative change in ownership of more than 50% within a three-year testing period. The Company has not completed an ownership change analysis pursuant to IRC Section 382. If ownership changes within the meaning of IRC Section 382 are identified as having occurred, the amount of NOLs and research tax carryforwards available to offset future taxable income and income tax liabilities in future years may be significantly restricted or eliminated. Further, deferred tax assets associated with such NOLs and research tax credits could be significantly reduced upon realization of an ownership change within the meaning of IRC Section 382. 116 In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Management considers projected future taxable income and tax planning strategies in making this assessment. At December 31, 2025 and 2024 , the Company has no t accrued any interest or penalties related to uncertain tax positions. The Company does not anticipate that there will be a significant change in the amount of unrecognized tax benefits over the next 12 months. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. The Company is subject to taxation in the United States. The UK subsidiary operations ceased in 2024 and there were no UK income taxes for the year ended December 31, 2024. The Company’s federal and state income tax returns for all years will remain open to examination by federal and state tax authorities for three years from the date of utilization of any net operating loss carryforwards. The Company’s federal and state returns since inception are subject to examination due to the carryover of net operating losses. The Company has not been, nor is it currently, under examination by any tax authorities. The UK tax returns from 2018 through 2024, are subject to examination by the UK tax authorities. 13. Commitments and Contingencies Legal Proceedings Merger Proceedings In connection with the Merger, two complaints were filed in the Supreme Court of the State of New York, County of New York, captioned Thomas v. Reneo Pharmaceuticals, Inc., et al. , Index No. 654628/2024 (filed September 5, 2024) and Kent v. Reneo Pharmaceuticals, Inc., et al. , Index No. 654642/2024 (filed September 6, 2024) (together, the “Complaints”). The Complaints generally allege that the Proxy Statement/Prospectus filed by Reneo with the SEC misrepresented and/or omitted certain purportedly material information relating to Reneo management’s financial projections for Reneo and OnKure, the data and inputs underlying the financial valuation analyses that support the fairness opinion provided by Leerink Partners, Reneo’s financial advisor, and potential conflicts of interest with Leerink Partners LLC, Evercore Group L.L.C., and LifeSci Capital LLC, which were the placements agents for the Concurrent Financing that closed concurrently with the Merger. The Complaints assert violations of negligent misrepresentation and concealment in violation of New York common law and negligence in violation of New York common law. The Complaints sought orders enjoining the proposed Merger, or in the event that the Merger was consummated, orders rescinding the Merger or awarding actual and punitive damages, as well as all of the plaintiffs’ fees and expenses in connection with the litigation, including reasonable attorneys’ and experts’ fees and expenses. The plaintiffs have not pursued their claims in the Complaints and there has been no activity on either docket; however, the Complaints remain pending. We cannot predict the outcome of the Complaints or any other litigation that might be filed arising out of the Merger or the Concurrent Financing. The Company and the individual defendants intend to vigorously defend against the Complaints and any subsequently filed, similar actions. It is possible additional lawsuits may be filed arising out of the Merger or the Concurrent Financing. Absent new or significantly different allegations, the Company will not necessarily disclose such additional filings. From time-to-time in the future, the Company could be involved in disputes, including litigation, relating to claims arising out of operations in the normal course of business, which may have a material adverse effect on the Company’s consolidated results of operations or financial position. Clinical Trial Collaboration and Supply Agreement with Pfizer In August 2020, as amended in December 2024, the Company entered into a clinical trial collaboration and supply agreement under which Pfizer Inc. (“Pfizer”) agreed to supply drug product in connection with a clinical trial. The agreement continues until the earlier of the completion of all obligations of the parties or the termination of the contract by either party as defined in the agreement. The Company may terminate the agreement if the clinical trial is deemed to be unsafe, regulatory authorities raise concerns, or if Pfizer does not uphold its obligations outlined in the agreement. 117 Indemnification In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with members of its board of directors that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. To date, the Company has not incurred any material costs because of such indemnifications. The Company is not aware of any claims under indemnification arrangements, and it has not accrued any liabilities related to such obligations in its consolidated financial statements as of December 31, 2025. Severance A former officer of the Company terminated his employment with the Company on May 24, 2024 and entered into a separation agreement and release on that date. The separation agreement and release provides for payments and benefits including continuing payments of base salary for a period of 14 months following termination of employment, payment for or reimbursement for COBRA premiums for up to 14 months following termination of employment, a full accelerated vesting of his equity awards and extension of the post-termination exercise period applicable to his Options through the earlier of 12 months following termination of service or the applicable option expiration date. During the year ended December 31, 2024, the Company recorded an expense of $ 622,000 for these severance benefits in research and development expense, of which $ 326,000 remains unpaid and is included in accrued compensation. See Note 11 for discussion of stock-based compensation recorded for the modifications of equity awards discussed above. The related RSU shares were released in January 2025. No expense was recorded for these severance benefits for the year ended December 31, 2025. Certain Reneo employees became employees of the Company to assist with the Merger transition through the end of the year December 31, 2024 at which time they were terminated and received severance benefits in accordance with the Reneo severance agreements. The Company recorded expense of $ 225,000 for severance benefits for these employees for the year ended December 31, 2024, which is included in General and Administrative expenses and of which, approximately $ 154,000 remains unpaid as of December 31, 2024 and is included in accrued compensation. No expense was recorded for these severance benefits for the year ended December 31, 2025. Employee Benefit Plan The Company established a qualified 401(k) plan in June 2021 which covers all employees who meet eligibility requirements. The Company matches its employee contributions up to a maximum amount of 4 % of the participant’s compensation. During the years ended December 31, 2025, and 2024, the Company made matching contributions of approximately $ 483,000 and $ 360,000 , respectively. 14. Convertible Promissory Notes In June 2024, the Company entered into convertible promissory note agreements with certain of its existing investors for up to $ 12.0 million. At closing, the Company received total proceeds of $ 6.0 million and had the ability to draw up to an additional $ 6.0 million in the event the Merger with Reneo had not closed by September 30, 2024, but no additional draw was made. The notes bore interest at rates from 6 % per annum. All unpaid principal and accrued interest was due in December 2025, unless earlier converted. In October 2024, the unpaid notes and accrued unpaid interest automatically converted into shares issued in the Concurrent Financing at the price per share paid by investors in the Concurrent Financing. See Note 3 for further discussion. The Company incurred $ 142,000 of debt issuance costs related to the convertible promissory notes during the year ended December 31, 2024. Debt issuance costs are amortized as a component of interest expense over the term of the related debt using the straight-line method, which approximates the interest method. The Company recognized $ 148,000 in interest expense related to the amortization of the debt issuance costs for the year ended December 31, 2024 and a $ 114,000 loss on the conversion for the year ended December 31, 2024, both of which are recorded in interest and other expense in the Statement of Operations. As of December 31, 2024, the Company had no accrued interest related to the convertible promissory notes. 118 15. Subsequent Events Available for Issuance Increase On January 1, 2026, the number of shares of Class A common stock available for issuance under the 2024 Plan and the ESPP increased by 683,678 and 136,735 shares, respectively, pursuant to the provisions under the respective plans. 119 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.