What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-08-06 compared with 2024-05-08 · 116 added, 78 removed, 184 unchanged (51% of the section changed)

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In clinical studies across more than 300 patients, palazestrant has demonstrated strong anti-tumor activity, attractive pharmacokinetics and prolonged drug exposure, favorable tolerability, and combinability with CDK4/6 inhibitors with no significant drug-drug interaction.

Palazestrant is being evaluated both as a single agent in an ongoing Phase 3 clinical trial, OPERA-01, in Phase 2 combination studies with a CDK4/6 inhibitor (palbociclib or ribociclib) and a phosphatidylinositol 3 kinase alpha, or PI3Ka, inhibitor (alpelisib) and an anticipated Phase 1b/2 combination study with an mTOR inhibitor (everolimus).

Palazestrant is being evaluated as a single agent in an ongoing Phase 3 clinical trial, OPERA-01, and in Phase 1/2 combination studies with a CDK4/6 inhibitor (palbociclib or ribociclib), a phosphatidylinositol 3 kinase alpha, or PI3Ka, inhibitor (alpelisib), and an anticipated Phase 1b/2 combination study with an mTOR inhibitor (everolimus).

We reported positive Phase 2 clinical results for palazestrant as a monotherapy in October 2023 at the European Society for Medical Oncology, or ESMO, Congress 2023, which demonstrated compelling progression-free survival, or PFS, a favorable tolerability profile and attractive pharmacokinetics in a heavily pretreated patient population.

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We are investigating palazestrant in combination with CDK4/6 inhibitors, palbociclib and ribociclib, and a PI3Ka inhibitor, alpelisib.

We reported interim results of our ongoing Phase 2 dose expansion clinical studies of palazestrant in combination with each of palbociclib and ribociclib at the 2023 San Antonio Breast Cancer Symposium in December 2023.

Across both studies, the interim results demonstrated no significant drug-drug interaction, no dose-limiting toxicities, and a tolerability profile consistent with the FDA-approved labels of ribociclib or palbociclib plus an endocrine therapy.

Both studies are being conducted at the palazestrant recommended Phase 2 dose, or RP2D, of 120 mg combined with the full FDA-approved label doses of palbociclib 125 mg, or ribociclib 600 mg.

We presented interim results from the Phase 2 portion of the palazestrant-ribociclib combination clinical study at the ESMO Breast Cancer Annual Congress 2024 in May 2024 in Berlin, Germany.

As of the data cut-off date of March 13, 2024, the combination of the palazestrant recommended Phase 2 dose, or RP2D, of 120 mg in combination with the full U.S.

Food and Drug Administration, or FDA-approved label dose of 600 mg of ribociclib was well tolerated with no new safety signals or enhancement of toxicity and palazestrant did not affect ribociclib drug exposure while ribociclib had no clinically meaningful effect on palazestrant drug exposure.

Furthermore, the results for the maturing dataset showed anti-tumor activity and prolonged disease stabilization, and a clinical benefit rate, or CBR, of 85% across 13 CBR-eligible patients.

We expect the data from the Phase 2 palazestrant-ribociclib combination clinical study will enable us to prepare to initiate a pivotal Phase 3 first-line clinical trial of palazestrant in combination with ribociclib.

We anticipate providing updated results from the Phase 2 clinical study at a future medical meeting.

We also reported interim results of our ongoing Phase 2 dose expansion clinical studies of palazestrant in combination with palbociclib at the 2023 San Antonio Breast Cancer Symposium in December 2023.

The interim results demonstrated no significant drug-drug interaction, no dose-limiting toxicities, and a tolerability profile consistent with the FDA-approved labels of palbociclib plus an endocrine therapy.

The study is being conducted at the RP2D for palazestrant combined with the full FDA-approved label dose of palbociclib 125 mg.

In October 2023, we announced the expansion of our clinical collaboration with Novartis Institutes for BioMedical Research, Inc., or Novartis, increasing the size of the ongoing Phase 1/2 clinical study testing palazestrant in combination with ribociclib to approximately 60 patients, and in March 2024, we further increased the size of the ongoing Phase 1/2 clinical study testing palazestrant in combination with ribociclib by an additional 15 patients exploring 90 mg of palazestrant in combination with 600 mg of ribociclib.

We will be presenting results from the Phase 2 portion of the palazestrant-ribociclib combination clinical study at the ESMO Breast Cancer Annual Congress 2024 in May 2024 in Berlin.

Furthermore, we expect the data from the Phase 2 palazestrant-ribociclib combination clinical study will enable us to prepare to initiate a pivotal Phase 3 first-line clinical trial of palazestrant in combination with ribociclib.

We also plan to initiate evaluation of palazestrant in combination with an mTOR inhibitor, everolimus, in a Phase 1b/2 clinical study, anticipated in the third quarter of 2024.

In July 2022, we were granted Fast Track designation from the U.S.

Food and Drug Administration, or the FDA, for palazestrant for patients with ER+/HER2- metastatic breast cancer that has progressed following one or more lines of endocrine therapy with at least one line given in combination with a CDK4/6 inhibitor.

In July 2022, we were granted Fast Track designation from the FDA for palazestrant for patients with ER+/HER2- metastatic breast cancer that has progressed following one or more lines of endocrine therapy with at least one line given in combination with a CDK4/6 inhibitor.

In addition, in October 2023 we presented new preclinical data regarding the discovery of novel compounds targeting KAT6, an epigenetic target that is dysregulated in breast and other cancers.

In January 2024, we nominated a development candidate for this program, OP-3136, and we expect to file an Investigational New Drug, or IND, application with the FDA in late 2024 and advance into clinical development.

In January 2024, we nominated a development candidate for this program, OP-3136.

We have completed Investigational New Drug, or IND, enabling studies for OP-3136, and we anticipate providing additional pre-clinical data for OP-3136 in the fourth quarter of 2024.

We expect to file an IND application with the FDA in late 2024 and advance into clinical development.

In a non-clinical xenograft model, OP-3136 caused dose-dependent tumor growth inhibition and tumor regression comparable to or better than a positive-control patented KAT6 inhibitor and demonstrated synergy in combination with CDK4/6 inhibitors or palazestrant.

We are advancing the development of this program in collaboration with Aurigene Oncology, or Aurigene.

Since our inception, we have devoted substantially all of our resources to organizing and staffing our company, research and development activities, business planning, raising capital, establishing and maintaining our intellectual property portfolio, conducting nonclinical studies and clinical trials and providing general and administrative support for these operations.

Since our inception, we have devoted substantially all of our resources to organizing and staffing our company, research and development activities, business planning, raising capital, establishing and maintaining our intellectual property portfolio, conducting non-clinical studies and clinical trials and providing general and administrative support for these operations.

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

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We also do not own or operate, and currently have no plans to establish, any manufacturing facilities.

We rely, and expect to continue to rely, on third parties for the manufacture of our product candidates for nonclinical and clinical testing, as well as for commercial manufacturing if any of our product candidates obtain marketing approval.

We rely, and expect to continue to rely, on third parties for the manufacture of our product candidates for non-clinical and clinical testing, as well as for commercial manufacturing if any of our product candidates obtain marketing approval.

We believe that this strategy allows us to maintain a more efficient infrastructure by eliminating the need for us to invest in our own manufacturing facilities, equipment and personnel while also enabling us to focus our expertise and resources on the development of our product candidates.

We have incurred significant operating losses since the commencement of our operations.

Our net losses were $31.0 million and $28.3 million for the three months ended March 31, 2024 and 2023, respectively.

Our net losses were $30.4 million and $20.1 million for the three months ended June 30, 2024 and 2023, respectively, and $61.4 million and $48.4 million for the six months ended June 30, 2024 and 2023, respectively.

We expect to incur significant and increasing losses for the foreseeable future as we continue to advance our product candidates, make potential milestone payments to our licensors, and as we continue to operate as a public company.

Our net losses may fluctuate significantly from period to period, depending on the timing of expenditures on our research and development activities.

As of March 31, 2024, we had an accumulated deficit

of $336.6 million.

As of June 30, 2024, we had an accumulated deficit of $367.0 million.

Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures and general and administrative expenditures.

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• continue our ongoing and planned research and development of our lead product candidate, palazestrant, for the treatment of ER+ positive breast cancer;

• initiate nonclinical studies and clinical trials for OP-3136 and any additional product candidates that we may pursue in the future;

• initiate non-clinical studies and clinical trials for OP-3136 and any additional product candidates that we may pursue in the future;

• seek to discover and develop additional product candidates and further expand our clinical product pipeline;

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Our ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and volatility in, the credit and financial markets in the United States and worldwide resulting from geopolitical and macroeconomic conditions.

Our failure to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on our business, results of operations or financial condition,

including requiring us to have to delay, reduce or eliminate our product development or future commercialization efforts.

Our failure to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on our business, results of operations or financial condition, including requiring us to have to delay, reduce or eliminate our product development or future commercialization efforts.

Insufficient liquidity may also require us to relinquish rights to product candidates at an earlier stage of development or on less favorable terms than we would otherwise choose.

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Research and development expenses account for a significant portion of our operating expenses and consist primarily of external and internal expenses incurred in connection with the discovery and development of our product candidates.

To date, our research and development expenses have related primarily to discovery efforts and nonclinical and clinical development of our lead product candidate, palazestrant, as well as OP-3136.

To date, our research and development expenses have related primarily to discovery efforts and non-clinical and clinical development of our lead product candidate, palazestrant, as well as OP-3136.

Research and development expenses are recognized as incurred and payments made prior to the receipt of goods or services to be used in research and development are capitalized until the goods or services are received.

External expenses include:

• expenses incurred in connection with the discovery and nonclinical development of our product candidates, including under agreements with third parties, such as consultants and contract research organizations, or CROs;

• costs of manufacturing products for use in our nonclinical studies and clinical trials, including payments to contract manufacturing organizations, or CMOs, and consultants;

• expenses incurred in connection with the discovery and non-clinical development of our product candidates, including under agreements with third parties, such as consultants and contract research organizations, or CROs;

• costs of manufacturing products for use in our non-clinical studies and clinical trials, including payments to contract manufacturing organizations, or CMOs, and consultants;

• costs of funding research performed by third parties;

• costs of purchasing lab supplies and non-capital equipment used in designing, developing and manufacturing nonclinical study and clinical trial materials;

• costs of purchasing lab supplies and non-capital equipment used in designing, developing and manufacturing non-clinical study and clinical trial materials;

• costs associated with consultants for chemistry, manufacturing and controls development, regulatory, statistics and other services;

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We expense research and development expenses in the periods in which they are incurred.

Costs for certain activities, such as manufacturing and nonclinical studies and clinical trials, are generally recognized based on an evaluation of the progress to completion of specific tasks using information and data provided to us by our vendors and collaborators.

Costs for certain activities, such as manufacturing and non-clinical studies and clinical trials, are generally recognized based on an evaluation of the progress to completion of specific tasks using information and data provided to us by our vendors and collaborators.

We typically use our employee, consultant and infrastructure resources across our development programs.

We track outsourced development costs by product candidate or nonclinical program, but we do not allocate personnel costs, other internal costs or external consultant costs to specific product candidates or nonclinical programs.

While our research and development expenses may fluctuate from period to period, we generally expect our research and development expenses to increase substantially in absolute dollars for the foreseeable future as we advance palazestrant, OP-3136 or any other future product candidates we may develop into and through nonclinical studies and clinical trials and pursue regulatory approval of our product candidates.

We track outsourced development costs by product candidate or non-clinical program, but we do not allocate personnel costs, other internal costs or external consultant costs to specific product candidates or non-clinical programs.

While our research and development expenses may fluctuate from period to period, we generally expect our research and development expenses to increase substantially in absolute dollars for the foreseeable future as we advance palazestrant, OP-3136 or any other future product candidates we may develop into and through non-clinical studies and clinical trials and pursue regulatory approval of our product candidates.

The process of conducting the necessary clinical research to obtain regulatory approval is costly and time-consuming.

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As a result of the uncertainties discussed above, we are unable to determine the duration and completion costs of our research and development projects or when and to what extent we will generate revenue from the commercialization and sale of palazestrant, OP-3136 or any other future product candidates we may develop.

Clinical and nonclinical development timelines, the probability of success and development costs can differ materially from expectations.

We anticipate that we will make determinations as to which product candidates to pursue and how much funding to direct to each product candidate on an ongoing basis in response to the results of ongoing and future nonclinical studies and clinical trials, regulatory developments and our ongoing assessments as to each product candidate’s commercial potential.

Clinical and non-clinical development timelines, the probability of success and development costs can differ materially from expectations.

We anticipate that we will make determinations as to which product candidates to pursue and how much funding to direct to each product candidate on an ongoing basis in response to the results of ongoing and future non-clinical studies and clinical trials, regulatory developments and our ongoing assessments as to each product candidate’s commercial potential.

In addition, we cannot forecast whether palazestrant, OP-3136 or any other future product candidates we may develop may be subject to future collaborations, when such arrangements will be secured, if at all, and to what degree such arrangements would affect our development plans and capital requirements.

We are also unable to predict when, if ever, we will generate revenue from our product candidates to offset these expenses.

Our expenditures on current and future nonclinical and clinical development programs are subject to numerous uncertainties in timing and cost to completion.

The duration, costs and timing of nonclinical studies and clinical trials and development of our product candidates will depend on a variety of factors, including:

• the timing and progress of nonclinical and clinical development activities;

• the number and scope of nonclinical and clinical programs we decide to pursue;

Our expenditures on current and future non-clinical and clinical

development programs are subject to numerous uncertainties in timing and cost to completion.

The duration, costs and timing of non-clinical studies and clinical trials and development of our product candidates will depend on a variety of factors, including:

• the timing and progress of non-clinical and clinical development activities;

• the number and scope of non-clinical and clinical programs we decide to pursue;

• our ability to maintain our current research and development programs and to establish new ones;

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General and administrative expenses also include costs not otherwise included in research and development expenses, including corporate facility costs, depreciation and other expenses, which include direct or allocated expenses for rent and maintenance of facilities and insurance, and professional fees for legal, patent and consulting services.

While our general and administrative expenses may fluctuate from period to period, we generally expect that our general and administrative expenses will increase in the foreseeable future as we increase our headcount to support the continued research and development of our programs and the growth of our business.

to support the continued research and development of our programs and the growth of our business.

We also anticipate incurring additional expenses associated with operating as a public company, including increased expenses related to the building and improving of our IT infrastructure, including cyber security monitoring, legal, other regulatory and compliance, director and officer insurance, investor and public relations and tax-related services associated with maintaining compliance with the rules and regulations of the SEC and standards applicable to companies listed on a national securities exchange, additional insurance expenses, investor relations activities and other administrative and professional services.

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Results of operations

Comparison of the three months ended March 31, 2024 and 2023

The following table summarizes our results of operations for the three months ended March 31, 2024 and 2023:

Three Months Ended March 31,

Comparison of the three months ended June 30, 2024 and 2023

The following table summarizes our results of operations for the three months ended June 30, 2024 and 2023:

Three Months Ended June 30,

(in thousands)

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Interest income

Other income (expense)

Total other income

Research and development expenses

The following table summarizes our research and development expenses by functional area for the three months ended March 31, 2024 and 2023:

Three Months Ended March 31,

The following table summarizes our research and development expenses by functional area for the three months ended June 30, 2024 and 2023:

Three Months Ended June 30,

(in thousands)

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Compensation and related benefits

Milestone payment owed to Aurigene

Other research and development expenses

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Total research and development expenses

Research and development expenses for the three months ended March 31, 2024 were $29.9 million, compared to $22.8 million for the three months ended March 31, 2023.

The increase of $7.1 million was primarily due to (i) a $5.0 million milestone payment owed to Aurigene in connection with the exclusive global license agreement entered into in June 2022 between the Company and Aurigene, or the Aurigene Agreement, (ii) increased spending on clinical operations and development-related activities as we continue to advance palazestrant into late-stage clinical trials, and (iii) an increase in non-cash stock-based compensation expense.

The increase was offset by (i) decreased spending on clinical pharmacology studies and nonclinical research programs and (ii) $1.8 million one-time restructuring charge recorded in the first quarter of 2023.

Research and development expenses for the three months ended June 30, 2024 were $29.1 million, compared to $18.0 million for the three months ended June 30, 2023.

The increase of $11.1 million was primarily due to (i) increased spending on clinical operations and development-related activities as we continue to advance palazestrant into late-stage clinical trials, (ii) other research and development activities associated with the advancement of our KAT6 inhibitor program, and (iii) personnel-related costs, including an increase in non-cash stock-based compensation expense of $1.3 million.

General and administrative expenses

General and administrative expenses for the three months ended March 31, 2024 were $4.5 million compared to $6.8 million for the three months ended March 31, 2023.

The decrease of $2.3 million was primarily due to (i) decreased spending on corporate- and legal-related costs, and (ii) personnel-related expenses, including a $1.0 million one-time restructuring charge recorded in the first quarter of 2023.

Other income for the three months ended March 31, 2024 was $3.4 million, compared to $1.3 million for the three months ended March 31, 2023.

General and administrative expenses for the three months ended June 30, 2024 were $4.4 million compared to $3.6 million for the three months ended June 30, 2023.

The increase of $0.8 million was primarily due to (i) increased spending on corporate-related costs, and (ii) an increase in non-cash stock-based compensation expense of $0.3 million.

Other income for the three months ended June 30, 2024 was $3.1 million, compared to $1.5 million for the three months ended June 30, 2023.

The increase of $1.6 million was primarily due to an increase in interest income from our marketable securities.

Results of operations

Comparison of the six months ended June 30, 2024 and 2023

The following table summarizes our results of operations for the six months ended June 30, 2024 and 2023:

Six Months Ended June 30,

(in thousands)

Operating expenses:

Research and development

General and administrative

Total operating expenses

Loss from operations

Other income:

Interest income

Other income (expense)

Total other income

Research and development expenses

The following table summarizes our research and development expenses by functional area for the six months ended June 30, 2024 and 2023:

Six Months Ended June 30,

(in thousands)

CROs, CMOs and other clinical development related third-party vendor expenses

Compensation and related benefits

Other research and development expenses

Stock-based compensation

Milestone payment made to Aurigene

Total research and development expenses

Research and development expenses for the six months ended June 30, 2024 were $59.0 million, compared to $40.8 million for the six months ended June 30, 2023.

The increase of $18.2 million was primarily due to (i) increased spending on clinical operations and development-related activities as we continue to advance palazestrant into late-stage clinical trials, (ii) a $5.0 million milestone payment made to Aurigene in connection with the exclusive global license agreement entered into in June 2022 between the Company and Aurigene, or the Aurigene Agreement, (iii) other research and development activities associated with the advancement of our KAT6 inhibitor program, and (iv) personnel-related costs, including an increase in non-cash stock-based compensation expense of $1.6 million.

General and administrative expenses

General and administrative expenses for the six months ended June 30, 2024 were $8.9 million compared to $10.4 million for the six months ended June 30, 2023.

The decrease of $1.5 million was primarily due to (i) decreased spending on corporate- and legal-related costs, and (ii) decreased personnel-related expenses, including a $1.0 million one-time restructuring charge recorded in the first quarter of 2023.

The decrease was partially offset by an increase in non-cash stock-based compensation expense of $0.3 million.

Other income for the six months ended June 30, 2024 was $6.5 million, compared to $2.8 million for the six months ended June 30, 2023.

The increase of $3.7 million was primarily due to an increase in interest income from our marketable securities.

Liquidity and capital resources

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Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations.

Our net losses were $31.0 million and $28.3 million for the three months ended March 31, 2024 and 2023, respectively.

Through March 31, 2024, we had received aggregate gross proceeds of $535.8 million from sales of our common stock, convertible preferred stock and issuance of convertible promissory notes, stock option exercises, and sale of stock through the Company’s 2020 Employee Stock Purchase Plan, or ESPP.

As of March 31, 2024, we had $249.0 million in cash, cash equivalents and marketable securities and accumulated deficit of $336.6 million.

We had no debt outstanding as of March 31, 2024.

Our net losses were $30.4 million and $20.1 million for the three months ended June 30, 2024 and 2023, respectively.

Through June 30, 2024, we had received aggregate gross proceeds of $551.3 million from sales of our common stock, convertible preferred stock and issuance of convertible promissory notes, stock option exercises, and sale of stock through the Company’s 2020 Employee Stock Purchase Plan, or ESPP.

As of June 30, 2024, we had $239.1 million in cash, cash equivalents and marketable securities and accumulated deficit of $367.0 million.

We had no debt outstanding as of June 30, 2024.

In September 2023, we entered into a stock purchase agreement for a private placement of 13,211,381 shares of our common stock, at a price of $9.84 per share, to selected institutional and accredited investors, or the Private Placement, resulting in gross proceeds of approximately $130.0 million.

After deducting offering expenses related to the Private Placement of approximately $0.3 million, the net proceeds to us from the Private Placement were approximately $129.7 million.

On September 5, 2023, we entered into a loan and security agreement, or the Loan Agreement, with Silicon Valley Bank, a division of First Citizens Bank & Trust Company, or the Bank, which provides us with an aggregate principal amount of up to $50.0 million, or the Credit Facility, of which $25.0 million became available upon the closing of the Private Placement, and the remaining $25.0 million may be made available upon approval of the Bank in its discretion.

The Credit Facility will mature on August 1, 2027.

As of March 31, 2024, we had not drawn down from the Credit Facility, and had no other debt outstanding.

On January 5, 2024, we entered into a sales agreement, or the Sales Agreement, with Cowen and Company, LLC, or TD Cowen, as sales agent, pursuant to which we may offer and sell, from time to time, shares of our common stock, having an aggregate offering price of up to $150.0 million, or the ATM Shares.

On September 5, 2023, we entered into a loan and security agreement, or the Original Loan Agreement, with Silicon Valley Bank, a division of First Citizens Bank & Trust Company, or the Bank, which provided us with an aggregate principal amount of up to $50.0 million, or the Original Credit Facility.

On June 28, 2024, we entered into the First Amendment to Loan and Security Agreement, or the Amendment, and the Original Loan Agreement as amended by the Amendment, the Loan Agreement, with the Bank.

The Amendment amends the Original Loan Agreement in order to, among other things, (i) increase the aggregate principal amount of the Original Credit Facility from up to $50.0 million to up to $100.0 million, or the Credit Facility, of which $25.0 million is currently available, an additional $25.0 million will become available upon achieving certain milestones related to execution of a first-line pivotal Phase 3 clinical trial of palazestrant in combination with ribociclib, and an additional $50.0 million which may be made available upon approval of the Bank in its discretion, and (ii) extend the maturity date to July 1, 2028.

As of June 30, 2024, we had not drawn down from the Credit Facility.

common stock, having an aggregate offering price of up to $150.0 million, or the ATM Shares.

The sales, if any, of the ATM Shares will be made by any method permitted that is deemed to be an “at-the-market”, or ATM, equity offering as defined in Rule 415(a)(4) promulgated under the Securities Act, including sales made directly on or through the Nasdaq Global Select Market.

We have agreed to pay TD Cowen a commission of up to 3.0% of the aggregate gross proceeds from any ATM Shares sold by TD Cowen.

During the three months ended March 31, 2024, we issued 546,326 shares of our common stock under the ATM program for net proceeds of $7.9 million after deducting related issuance costs.

As of March 31, 2024, approximately $141.8 million remained available for issuance under the Sales Agreement.

We expect to incur significant expenses and operating losses for the foreseeable future as we advance the clinical development of palazestrant, OP-3136 and nonclinical studies.

We expect that our research and development and general and administrative costs will increase in connection with conducting additional nonclinical studies and clinical trials for our current and future research programs and product candidates, contracting with CMOs to support nonclinical studies and clinical trials, expanding our intellectual property portfolio, and providing general and administrative support for our operations.

During the three months ended June 30, 2024, we issued 1,225,952 shares of our common stock under the Sales Agreement at a weighted-average price of $12.14 per share for net proceeds of $14.9 million after deducting related issuance costs.

During the six months ended June 30, 2024, we issued 1,772,278 shares of our common stock under the Sales Agreement at a weighted-average price of $13.19 for net proceeds of $22.8 million after deducting related issuance costs.

As of June 30, 2024, approximately $126.6 million remained available for issuance under the Sales Agreement.

We expect to incur significant expenses and operating losses for the foreseeable future as we advance the clinical development of palazestrant, OP-3136 and non-clinical studies.

We expect that our research and development and general and administrative costs will increase in connection with conducting additional non-clinical studies and clinical trials for our current and future research programs and product candidates, contracting with CMOs to support non-clinical studies and clinical trials, expanding our intellectual property portfolio, and providing general and administrative support for our operations.

As a result, we will need additional capital to fund our operations, which we may obtain from additional equity or debt financings, collaborations, licensing arrangements or other sources.

Our primary uses of cash are to fund our research and development activities, including with respect to palazestrant, OP-3136 and other nonclinical programs, business planning, establishing and maintaining our intellectual property portfolio, hiring personnel, raising capital and providing general and administrative support for these operations.

Our primary uses of cash are to fund our research and development activities, including with respect to palazestrant, OP-3136 and other non-clinical programs, business planning, establishing and maintaining our intellectual property portfolio, hiring personnel, raising capital and providing general and administrative support for these operations.

Other than as noted above, we currently have no financing commitments, such as lines of credit or guarantees, that are expected to affect our liquidity over the next five years.

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The amount and timing of our future funding requirements will depend on many factors, including the pace and results of our development efforts.

We expect our cash, cash equivalents, and marketable securities as of March 31, 2024, as well as the available balance under the Credit Facility, will enable us to fund our current operating plan for at least the next 12 months from the filing date of these condensed consolidated financial statements.

We expect our cash, cash equivalents, and marketable securities as of June 30, 2024, as well as the available balance under the Credit Facility, will enable us to fund our current operating plan for at least the next 12 months from the filing date of these condensed consolidated financial statements.

Refer to Note 10 of our notes to the condensed consolidated financial statements contained in this Quarterly Report on Form 10-Q for further information regarding our material cash requirements;

other than as set forth therein, there have been no material changes outside the ordinary course of business during the three months ended March 31, 2024 to our commitments and contingencies disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K.

other than as set forth therein, there have been no material changes outside the ordinary course of business during the three months ended June 30, 2024 to our commitments and contingencies disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K.

If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate our research and development programs or future commercialization efforts.

Our future capital requirements will depend on many factors, including:

• the scope, progress, results and costs of product discovery, nonclinical studies and clinical trials;

• the scope, progress, results and costs of product discovery, non-clinical studies and clinical trials;

• the scope, prioritization and number of our research and development programs;

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• the costs of establishing or contracting for sales and marketing capabilities if we obtain regulatory approvals to market our product candidates.

Identifying potential product candidates and conducting nonclinical studies and clinical trials is a time- consuming, expensive and uncertain process that takes many years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product sales.

Identifying potential product candidates and conducting non-clinical studies and clinical trials is a time- consuming, expensive and uncertain process that takes many years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product sales.

In addition, our product candidates, if approved, may not achieve commercial success.

Our commercial revenues, if any, will be derived from sales of one or more product candidates that we do not expect to be commercially available

for many years, if at all.

Our commercial revenues, if any, will be derived from sales of one or more product candidates that we do not expect to be commercially available for many years, if at all.

Accordingly, we will need to continue to rely on additional financing to achieve our business objectives.

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The following table shows a summary of our cash flows for each of the periods presented:

Three Months Ended March 31,

Six Months Ended June 30,

(in thousands)

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Operating activities

Net cash used in operating activities during the three months ended March 31, 2024 consisted primarily of our net loss of $31.0 million and non-cash interest income on our marketable securities of $2.4 million, offset by a net increase in operating assets and liabilities of $4.8 million and non-cash charges of $5.0 million.

Net cash used in operating activities during the six months ended June 30, 2024 consisted primarily of our net loss of $61.4 million and non-cash interest income on our marketable securities of $4.5 million, offset by a net increase in operating assets and liabilities of $4.0 million and non-cash charges of $10.8 million.

The net loss consisted primarily of $59.0 million in research and development expenses and $8.9 million in general and administrative expenses.

The non-cash charges consisted primarily of stock-based compensation expense of $4.9 million and depreciation and amortization expenses of $0.1 million, and non-cash lease expense of less than $0.1 million, net of cash payments of $0.3 million.

The net increase in operating assets and liabilities was primarily due to (i) an increase of $5.0 million in accounts payable, which is primarily due to the timing of a milestone payment to Aurigene, and (ii) a decrease of $1.6 million in prepaid expenses and other current assets, which is primarily due to the reimbursable research and development costs received from a collaboration partner.

The changes were partially offset by (i) an increase of $1.3 million in other assets and long-term deposits, and (ii) a decrease of $0.4 million in accrued and other current liabilities.

Net cash used in operating activities during the three months ended March 31, 2023 consisted primarily of our net loss of $28.3 million, offset by non-cash charges of $3.9 million and a net increase in net operating assets and liabilities of $4.0 million.

The non-cash charges consisted primarily of stock-based compensation expense of $10.6 million, depreciation and amortization expenses of $0.2 million, and non-cash lease expense of less than $0.1 million, net of cash payments of $0.6 million.

The net increase in operating assets and liabilities was primarily due to (i) an increase of $3.2 million in accrued and other current liabilities, (ii) an increase of $1.7 million in accounts payable, and (iii) a decrease of $1.6 million in prepaid expenses and other current assets, which is primarily due to the reimbursable research and development costs received from a collaboration partner.

The changes were partially offset by an increase of $2.4 million in other assets and long-term deposits.

Net cash used in operating activities in the six months ended June 30, 2023 consisted primarily of our net loss of $48.4 million and a net decrease in operating assets and liabilities of $1.1 million, partially offset by non-cash charges of $7.0 million.

The net loss consisted primarily of $40.8 million in research and development expenses and $10.4 million in general and administrative expenses.

The non-cash charges consisted primarily of stock-based compensation of $4.6 million and depreciation and amortization expenses of $0.1 million, and non-cash lease expense of less than $0.1 million, net of cash payments of $0.3 million.

These non-cash expenses were primarily offset by non-cash interest income on our marketable securities of $0.9 million.

The net increase in operating assets and liabilities was primarily due to (i) a net increase of $2.7 million in other current liabilities, (ii) a net increase of $1.0 million in prepaid expenses and other current assets and (iii) a net increase of $0.3 million in accounts payable, which is primarily a result of timing of invoice payment.

The non-cash charges consisted primarily of stock-based compensation expense of $8.8 million and depreciation and amortization expenses of $0.2 million, primarily offset by non-cash interest income on our marketable securities of $2.0 million.

The net decrease in operating assets and liabilities was primarily due to (i) a decrease of $2.7 million in accrued and other current liabilities and (ii) an increase of $0.1 million in other assets and long-term deposits.

The changes were partially offset by (i) an increase of $1.3 million in accounts payable, which is primarily a result of timing of invoice payment, and (ii) a decrease of $0.4 million in prepaid expenses and other current assets.

Investing Activities

Net cash used in investing activities during the three months ended March 31, 2024 was predominantly due to purchases of marketable securities which were offset by maturities of marketable securities.

Net cash provided by investing activities during the three months ended March 31, 2023 was predominantly due to maturities of marketable securities which were offset by the purchases of marketable securities.

Net cash used in investing activities during the six months ended June 30, 2024 was predominantly due to purchases of marketable securities which were partially offset by maturities of marketable securities.

Net cash provided by investing activities during the six months ended June 30, 2023 was predominantly due to maturities of marketable securities which were offset by purchases of marketable securities.

Financing activities

Net cash provided by financing activities during the three months ended March 31, 2024 consists of $7.9 million in net proceeds from the sale of ATM Shares and $0.9 million from the exercise of stock options.

Net cash provided by financing activities during the three months ended March 31, 2023 represents $0.2 million in net proceeds from the exercise of stock options.

Critical accounting policies and significant judgements and estimates

Net cash provided by financing activities during the six months ended June 30, 2024 consists of $22.8 million in net proceeds from the sale of ATM Shares, $1.0 million from the exercise of stock options, and $0.7 million from the sale of our common stock under the ESPP.

Net cash provided by financing activities during the six months ended June 30, 2023 consists of $1.6 million and $0.7 million in net proceeds from the exercise of stock options and the sale of our common stock under the ESPP, respectively.

Critical accounting policies and significant judgments and estimates

Our management’s discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with U.S.

4 unchanged sentences

Our actual results may differ from these estimates under different assumptions or conditions.

During the three months ended March 31, 2024, there were no material changes to our critical accounting policies and estimates as reported in our Annual Report on Form 10-K.

During the three months ended June 30, 2024, there were no material changes to our critical accounting policies and estimates as reported in our Annual Report on Form 10-K.

Quantitative and Qualitative Disclosures About Market Risk.

During the three months ended March 31, 2024, there were no material changes to our market risk disclosures reported in our Annual Report on Form 10-K.

During the three months ended June 30, 2024, there were no material changes to our market risk disclosures reported in our Annual Report on Form 10-K.

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What changed 10-Q

Item 2. Management’s Discussion and Analysis