Oruka Therapeutics, Inc. 10-Q

Item 1. Financial Statements ORUKA THERAPEUTICS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (In thousands, except share and per share data) September 30, December 31, 2025 2024 Assets Current assets: Cash and cash equivalents $ 91,253 $ 61,575 Marketable securities, current 257,902 314,073 Prepaid expenses and other current assets 6,008 1,221 Total current assets 355,163 376,869 Marketable securities, long-term 151,763 18,069 Property and equipment, net 253 162 Operating lease right-of-use assets 1,969 876 Other non-current assets 103 43 Total assets $ 509,251 $ 396,019 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 2,208 $ 3,462 Accrued expenses and other current liabilities 8,648 3,346 Operating lease liability, current 419 213 Related party common stock warrant liability 9,684 — Related party accounts payable and other current liabilities 8 6,022 Total current liabilities 20,967 13,043 Operating lease liability, non-current 1,493 755 Total liabilities 22,460 13,798 Commitments and contingencies (Note 11) Stockholders’ equity: Series B non-voting convertible preferred stock, $ 0.001 par value; 251,504 shares authorized as of September 30, 2025 and December 31, 2024; 137,138 shares issued and outstanding as of September 30, 2025 and December 31, 2024 2,931 2,931 Common stock, $ 0.001 par value; 545,000,000 shares authorized as of September 30, 2025 and December 31, 2024; 48,384,150 and 37,440,510 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively 48 37 Additional paid-in capital 643,201 463,018 Accumulated other comprehensive income (loss) 185 ( 41 ) Accumulated deficit ( 159,574 ) ( 83,724 ) Total stockholders’ equity 486,791 382,221 Total liabilities and stockholders’ equity $ 509,251 $ 396,019 The accompanying notes are an integral part of these condensed consolidated financial statements. 1 ORUKA THERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED) (In thousands, except share and per share data) Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Nine Months Ended September 30, 2025 Period from February 6, 2024 (inception) to September 30, 2024 Operating expenses: Research and development (1) $ 28,988 $ 25,691 $ 73,000 $ 49,557 General and administrative (2) 5,117 3,758 14,620 8,248 Total operating expenses 34,105 29,449 87,620 57,805 Loss from operations ( 34,105 ) ( 29,449 ) ( 87,620 ) ( 57,805 ) Other income (expense): Interest income 3,832 1,330 11,781 1,330 Interest expense (3) — ( 504 ) — ( 1,468 ) Other expense, net ( 4 ) — ( 11 ) — Total other income (expense), net 3,828 826 11,770 ( 138 ) Net loss ( 30,277 ) ( 28,623 ) ( 75,850 ) ( 57,943 ) Net change in unrealized gains (losses) on marketable securities 212 — 226 — Comprehensive loss $ ( 30,065 ) $ ( 28,623 ) $ ( 75,624 ) $ ( 57,943 ) Net loss per share attributable to common stockholders, basic and diluted $ ( 0.55 ) $ ( 1.46 ) $ ( 1.40 ) $ ( 6.08 ) Net loss per share attributable to Series A non-voting convertible preferred stockholders, basic and diluted $ — $ ( 1,461.10 ) $ — $ ( 6,077.25 ) Net loss per share attributable to Series B non-voting convertible preferred stockholders, basic and diluted $ ( 45.46 ) $ ( 121.76 ) $ ( 116.94 ) $ ( 506.44 ) Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted 44,067,059 15,013,655 42,622,935 7,765,381 Weighted-average shares used in computing net loss per share attributable to Series A non-voting convertible preferred stockholders, basic and diluted — 477 — 184 Weighted-average shares used in computing net loss per share attributable to Series B non-voting convertible preferred stockholders, basic and diluted 137,138 49,191 137,138 19,015 (1) Includes related party amounts of $ 9,595 and $ 13,537 for the three months ended September 30, 2025 and September 30, 2024, respectively, and $ 15,998 and $ 33,967 for the nine months ended September 30, 2025 and the period from February 6, 2024 (inception) to September 30, 2024, respectively (2) Includes related party amounts of $ 8 and $ 71 for the three months ended September 30, 2025 and September 30, 2024, respectively, and $ 130 and $ 1,339 for the nine months ended September 30, 2025 and the period from February 6, 2024 (inception) to September 30, 2024, respectively (3) Includes related party amounts of nil and $ 504 for the three months ended September 30, 2025 and September 30, 2024, respectively, and nil and $ 1,468 for the nine months ended September 30, 2025 and the period from February 6, 2024 (inception) to September 30, 2024, respectively The accompanying notes are an integral part of these condensed consolidated financial statements. 2 ORUKA THERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) (UNAUDITED) (In thousands, except share data) Series B Non-Voting Convertible Preferred Stock Common Stock Additional Paid-In Accumulated Other Comprehensive Accumulated Total Stockholders’ Shares Amount Shares Amount Capital Income (Loss) Deficit Equity Balances as of December 31, 2024 137,138 $ 2,931 37,440,510 $ 37 $ 463,018 $ ( 41 ) $ ( 83,724 ) $ 382,221 Stock-based compensation expense — — — — 3,468 — — 3,468 Net change in unrealized gains (losses) on marketable securities — — — — — 35 — 35 Net loss — — — — — — ( 20,999 ) ( 20,999 ) Balances as of March 31, 2025 137,138 $ 2,931 37,440,510 $ 37 $ 466,486 $ ( 6 ) $ ( 104,723 ) $ 364,725 Issuance of common stock under employee stock purchase plan — — 10,235 — 109 — — 109 Stock-based compensation expense — — — — 3,403 — — 3,403 Net change in unrealized gains (losses) on marketable securities — — — — — ( 21 ) — ( 21 ) Net loss — — — — — — ( 24,574 ) ( 24,574 ) Balances as of June 30, 2025 137,138 $ 2,931 37,450,745 $ 37 $ 469,998 $ ( 27 ) $ ( 129,297 ) $ 343,642 Issuance of common stock and pre-funded warrants in connection with the 2025 PIPE Financing — — 10,933,405 11 179,989 — — 180,000 Issuance cost of the 2025 PIPE Financing — — — — ( 10,356 ) — — ( 10,356 ) Stock-based compensation expense — — — — 3,570 — — 3,570 Net change in unrealized gains (losses) on marketable securities — — — — — 212 — 212 Net loss — — — — — — ( 30,277 ) ( 30,277 ) Balances as of September 30, 2025 137,138 $ 2,931 48,384,150 $ 48 $ 643,201 $ 185 $ ( 159,574 ) $ 486,791 Series A Convertible Preferred Stock Series A Non-Voting Convertible Preferred Stock Series B Non-Voting Convertible Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholders’ Equity Shares Amount Shares Amount Shares Amount Shares Amount Capital Deficit (Deficit) Balances as of February 6, 2024 (inception) — $ — — $ — — $ — 3,197,975 $ 3 $ ( 2 ) $ — $ 1 Issuance of common stock — — — — — — 2,207,553 2 ( 2 ) — — Issuance of Series A convertible preferred stock, net of issuance costs of $ 69 20,000,000 2,931 — — — — — — — — — Stock-based compensation expense — — — — — — — — 17 — 17 Net loss — — — — — — — — — ( 7,077 ) ( 7,077 ) Balances as of March 31, 2024 20,000,000 $ 2,931 — $ — — $ — 5,405,528 $ 5 $ 13 $ ( 7,077 ) $ ( 7,059 ) Stock-based compensation expense — — — — — — — — 321 — 321 Net loss — — — — — — — — — ( 22,243 ) ( 22,243 ) Balances as of June 30, 2024 20,000,000 $ 2,931 — $ — — $ — 5,405,528 $ 5 $ 334 $ ( 29,320 ) $ ( 28,981 ) Exchange of Series A convertible preferred stock for Series B non-voting convertible preferred stock upon the closing of the reverse recapitalization ( 20,000,000 ) ( 2,931 ) — — 137,138 2,931 — — — — 2,931 Conversion of convertible notes (including accrued interest) into common stock upon the closing of the reverse recapitalization — — — — — — 2,722,207 3 26,445 — 26,448 Issuance of common stock and pre-funded warrants in the Pre-Closing Financing, — — — — — — 20,061,932 20 248,437 — 248,457 Issuance costs of Pre-Closing Financing and reverse recapitalization — — — — — — — — ( 20,480 ) — ( 20,480 ) Issuance of common stock to former stockholders of ARCA biopharma, Inc. in connection with the closing of the reverse recapitalization — — — — — — 1,208,883 1 4,999 — 5,000 Issuance of common stock, Series A non-voting convertible preferred stock, and pre-funded warrants in connection with the 2024 PIPE Financing — — 2,439 56,097 — — 5,600,000 6 144,433 — 144,439 Issuance cost of the 2024 PIPE Financing ( 3,256 ) ( 8,573 ) ( 8,573 ) Stock-based compensation expense 1,750 1,750 Net loss — — — — — — — — — ( 28,623 ) ( 28,623 ) Balances as of September 30, 2024 — $ — 2,439 $ 52,841 137,138 $ 2,931 34,998,550 $ 35 $ 397,345 $ ( 57,943 ) $ 342,368 The accompanying notes are an integral part of these condensed consolidated financial statements. 3 ORUKA THERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (In thousands) Nine Months Ended September 30, 2025 Period from February 6, 2024 (inception) to September 30, 2024 Cash flows from operating activities: Net loss $ ( 75,850 ) $ ( 57,943 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense 20,125 9,769 Net accretion of premiums and discounts on marketable securities ( 4,340 ) — Non-cash interest expense — 1,468 Non-cash lease expense 319 65 Depreciation expense 55 11 Changes in operating assets and liabilities: Prepaid expenses and other current assets ( 3,167 ) ( 1,980 ) Other non-current assets ( 60 ) ( 43 ) Accounts payable ( 1,254 ) 1,621 Accrued expenses and other current liabilities 5,038 1,650 Operating lease liability ( 468 ) 6 Related party accounts payable and other current liabilities ( 6,014 ) 6,357 Net cash used in operating activities ( 65,616 ) ( 39,019 ) Cash flows from investing activities: Purchases of property and equipment ( 146 ) ( 171 ) Purchases of marketable securities ( 419,972 ) — Proceeds from maturities of marketable securities 345,395 — Net cash used in investing activities ( 74,723 ) ( 171 ) Cash flows from financing activities: Proceeds from issuance of Pre-Merger Oruka Series A Preferred Stock, net of issuance costs paid — 2,931 Proceeds from issuance of notes payable to related party, net of issuance costs paid — 24,980 Proceeds from the Pre-Closing Financing, net — 228,127 Proceeds from the PIPE Financings, net 169,908 189,087 Cash acquired in connection with the reverse recapitalization — 4,940 Proceeds from issuance of common stock 109 — Net cash provided by financing activities 170,017 450,065 Net increase in cash and cash equivalents 29,678 410,875 Cash and cash equivalents at beginning of period 61,575 — Cash and cash equivalents at end of period $ 91,253 $ 410,875 Supplemental disclosures of non-cash operating and financing activities: Operating lease liability arising from obtaining operating right-of-use asset $ 1,412 $ 982 Assets acquired in connection with the reverse recapitalization $ — $ 114 Other liabilities assumed in connection with the reverse recapitalization $ — $ ( 54 ) Pre-Closing Financing and reverse recapitalization issuance costs included in accounts payable $ — $ 150 PIPE Financing issuance costs included in accounts payable $ — $ 374 PIPE Financing issuance costs included in accrued expenses and other current liabilities $ 264 $ 6 Non-cash accrued interest on convertible note converted to common stock $ — $ 1,468 Non-cash exchange of Pre-Merger Oruka Series A Preferred Stock for Company Series B Convertible Preferred Stock $ — $ 2,931 The accompanying notes are an integral part of these condensed consolidated financial statements. 4 ORUKA THERAPEUTICS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. Nature of the Business and Basis of Presentation Background and Basis of Presentation Oruka Therapeutics, Inc., together with its subsidiaries (collectively, the “Company”), formerly known as ARCA biopharma, Inc. (“ARCA”), is a clinical-stage biopharmaceutical company that is the result of the reverse recapitalization discussed below. Prior to the reverse recapitalization, the private company Oruka Therapeutics, Inc. (“Pre-Merger Oruka”) was established and incorporated under the laws of the state of Delaware on February 6, 2024 (referred to in the Notes as the inception of the Company). The Company is headquartered in Menlo Park, California. The Company is led by the Pre-Merger Oruka management team and is focused on developing biologics for psoriasis and other inflammatory and immunology indications. The condensed consolidated financial statements and accompanying notes are prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”) for interim financial reporting and the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) and therefore do not include all information and disclosures normally included in the annual consolidated financial statements. The accompanying condensed consolidated financial statements reflect the operations of the Company and its wholly-owned subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited financial statements and the related notes thereto for the period ended December 31, 2024 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 6, 2025 (the “Annual Report”). The information as of December 31, 2024, included in the condensed consolidated balance sheets was derived from the Company’s audited financial statements. These unaudited interim condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements, and in the opinion of the Company’s management, reflect all adjustments, which include only normal recurring adjustments necessary for a fair statement of the Company’s condensed consolidated financial statements. The results for the three and nine months ended September 30, 2025 are not necessarily indicative of results that may be expected for the year ending December 31, 2025 or for any other interim period or for any other future year. Reverse Recapitalization, Pre-Closing Financing, and Reverse Stock Split On August 29, 2024 (the “Closing”), the Company completed the acquisition (the “Merger”) of Pre-Merger Oruka pursuant to an Agreement and Plan of Merger and Reorganization, dated as of April 3, 2024 (the “Merger Agreement”). Following the transactions contemplated by the Merger Agreement, on August 29, 2024, the Company changed its name from “ARCA biopharma, Inc.” to “Oruka Therapeutics, Inc.” and the Company effected a 1-for-12 reverse stock split (the “Reverse Stock Split”) of its common stock, par value $ 0.001 per share (“Company Common Stock”), which became effective on September 3, 2024. All references to common stock, options to purchase common stock, outstanding common stock warrants, common stock share data, per share data, Company Common Stock, and related information contained in the condensed consolidated financial statements have been retrospectively adjusted to reflect the effect of the Reverse Stock Split for all periods presented, unless otherwise specifically indicated or the context otherwise requires. Immediately prior to the execution and delivery of the Merger Agreement, certain new and existing investors of Pre-Merger Oruka entered into a subscription agreement with Pre-Merger Oruka (that was subsequently amended and restated in July 2024, the “Subscription Agreement”), pursuant to which, and on the terms and subject to the conditions of which, immediately prior to the Closing, those investors purchased shares of common stock of Pre-Merger Oruka (“Pre-Merger Oruka Common Stock”) and Pre-Merger Oruka pre-funded warrants for gross proceeds of approximately $ 275.0 million (which includes $ 25.0 million of proceeds previously received from the issuance of the Convertible Note (as defined in Note 6) and accrued interest on such note which converted to shares of Pre-Merger Oruka Common Stock) (the “Pre-Closing Financing”). The Company incurred transaction costs of $ 20.5 million which were recorded as a reduction to additional paid-in capital in the condensed consolidated financial statements. In connection with the Closing, the shares of Pre-Merger Oruka Common Stock were converted into shares of Company Common Stock and pre-funded warrants of Company Common Stock in accordance with the Exchange Ratio (as defined below and determined by the terms of the Merger Agreement). Moreover, as part of the Closing, (i) then-issued and outstanding shares of Pre-Merger Oruka Common Stock (including outstanding and unvested Pre-Merger Oruka restricted stock and shares of Pre-Merger Oruka Common Stock issued in connection with the Subscription Agreement) were converted into the right to receive a number of shares of Company Common Stock, equal to the exchange ratio of 6.8569 shares of Company Common Stock (the “Exchange Ratio”), which were subject to the same vesting provisions as those immediately prior to the Merger; (ii) each share of Pre-Merger Oruka Series A convertible preferred stock, par value $ 0.0001 (“Pre-Merger Oruka Series A Preferred Stock”) was converted into the right to receive a number of shares of ARCA Series B non-voting convertible preferred stock, par value $ 0.001 per share (“Company Series B Preferred Stock”), which are convertible into shares of Company Common Stock at a conversion ratio of approximately 83.3332:1 after the Reverse Stock Split, (iii) each outstanding option to purchase Pre-Merger Oruka Common Stock was converted into an option to purchase shares of Company Common Stock, and (iv) each outstanding warrant to purchase shares of Pre-Merger Oruka Common Stock was converted into a warrant to purchase shares of Company Common Stock. 5 The Merger was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Pre-Merger Oruka was deemed to be the accounting acquirer for financial reporting purposes. This determination was primarily based on the fact that, immediately following the Merger: (i) Pre-Merger Oruka stockholders owned a substantial majority of the voting rights in the combined company; (ii) Pre-Merger Oruka’s largest stockholders retained the largest interest in the combined company; (iii) Pre-Merger Oruka designated a majority of the initial members of the board of directors of the combined company; and (iv) Pre-Merger Oruka’s executive management team became the management team of the combined company. Accordingly, for accounting purposes: (a) the Merger was treated as the equivalent of Pre-Merger Oruka issuing stock to acquire the net assets of ARCA, and (b) the reported historical operating results of the combined company prior to the Merger are those of Pre-Merger Oruka. As part of the reverse recapitalization, the Company acquired a cash balance of $ 4.94 million from ARCA. PIPE Financings On September 11, 2024, the Company entered into a Securities Purchase Agreement (the “2024 Securities Purchase Agreement”) for a private placement (the “2024 PIPE Financing”) with certain institutional and accredited investors. The closing of the 2024 PIPE Financing occurred on September 13, 2024. Pursuant to the 2024 Securities Purchase Agreement, the investors purchased an aggregate of 5,600,000 shares of Company Common Stock at a purchase price of $ 23.00 per share, an aggregate of 2,439 shares of the Company’s Series A non-voting convertible preferred stock, par value $ 0.001 per share (“Company Series A Preferred Stock”), at a purchase price of $ 23,000.00 per share (each share of Company Series A Preferred Stock was convertible into 1,000 shares of Company Common Stock), and pre-funded warrants to purchase an aggregate of 680,000 shares of Company Common Stock at a purchase price of $ 22.999 per pre-funded warrant, for aggregate net proceeds of approximately $ 188.7 million (net of issuance costs of $ 11.9 million). In November 2024, the 2,439 shares of the Company Series A Preferred Stock were converted to 2,439,000 shares of Company Common Stock. On September 17, 2025, the Company entered into a Securities Purchase Agreement (the “2025 Securities Purchase Agreement”) for a private placement (the “2025 PIPE Financing”) with certain institutional and accredited investors. The closing of the 2025 PIPE Financing occurred on September 19, 2025. Pursuant to the 2025 Securities Purchase Agreement, the investors purchased an aggregate of 10,933,405 shares of Company Common Stock at a purchase price of $ 15.00 per share, and pre-funded warrants to purchase an aggregate of 1,066,666 shares of Company Common Stock at a purchase price of $ 14.999 per pre-funded warrant, for aggregate net proceeds of approximately $ 169.6 million (net of issuance costs of $ 10.4 million). Sales Agreement On October 3, 2025, the Company entered into a Sales Agreement with TD Securities (USA) LLC (the “Sales Agreement”), as its sales agent, pursuant to which the Company may issue and sell, from time to time, shares of the Company Common Stock for aggregate gross proceeds of up to $ 200.0 million under an at-the-market (“ATM”) offering program. The Company is not obligated to make any sales of shares under the Sales Agreement. Liquidity and Going Concern Since its inception, the Company has devoted substantially all of its resources to advancing the development of its portfolio of programs, organizing and staffing the Company, business planning, raising capital, and providing general and administrative support for these operations. Current and future programs will require significant research and development efforts, including preclinical and clinical trials, and regulatory approvals to commercialization. Until such time as the Company can generate significant revenue from product sales, if ever, the Company expects it will need additional financing to fund its operating activities. The Company has not generated any revenue from product sales or other sources and has incurred significant operating losses and negative cash flows from operations since inception. For the three and nine months ended September 30, 2025, the Company incurred net losses of $ 30.3 million and $ 75.9 million, respectively, and used net cash of $ 65.6 million for its operating activities during the first nine months of 2025. As of September 30, 2025, the Company had cash, cash equivalents, and marketable securities of $ 500.9 million. The Company’s management expects that the existing cash, cash equivalents, and marketable securities will be sufficient to fund the Company’s operating plans for at least twelve months from the date these condensed consolidated financial statements were issued. The Company expects that its research and development and general and administrative costs will continue to increase significantly, including in connection with conducting pre-clinical activities and clinical trials and manufacturing for its existing product candidates and any future product candidates to support commercialization and providing general and administrative support for its operations, including the costs associated with operating as a public company. The Company’s ability to access capital when needed is not assured and, if capital is not available to the Company when, and in the amounts needed, the Company may be required to significantly curtail, delay, or discontinue one or more of its research or development programs or the commercialization of any product candidate, or be unable to expand its operations or otherwise capitalize on the Company’s business opportunities, as desired, which could materially harm the Company’s business, financial condition and results of operations. 6 2. Summary of Significant Accounting Policies The Company’s significant accounting policies are detailed in the Notes titled “1. Nature of the Business and Basis of Presentation” and “2. Summary of Significant Accounting Policies” of the Company’s Annual Report. The Company uses the same accounting policies in preparing its quarterly and annual financial statements. There have been no material changes to significant accounting policies during the nine months ended September 30, 2025. Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, assumptions, and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting periods. Significant estimates and assumptions reflected within these condensed consolidated financial statements include but are not limited to research and development expenses and related prepaid or accrued costs and the valuation of stock-based compensation awards and related expenses. The Company bases its estimates on known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates, as there are changes in circumstances, facts, and experience. Actual results could differ materially from those estimates or assumptions. Recently Issued Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . This ASU expands disclosures in an entity’s income tax rate reconciliation table and disclosures regarding taxes paid both in the U.S. and foreign jurisdictions. This update is effective beginning with the Company’s 2025 fiscal year annual reporting period. The Company is currently evaluating the impact of the adoption of this ASU on its condensed consolidated financial statements. 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 the adoption of this ASU on its condensed consolidated financial statements. 7 3. Fair Value Measurements The following tables present the Company’s fair value hierarchy for financial assets measured as of September 30, 2025 and December 31, 2024 (in thousands): September 30, 2025 Level 1 Level 2 Level 3 Total Cash equivalents Money market funds $ 22,106 $ — $ — $ 22,106 U.S. treasury securities — 9,985 — 9,985 U.S. government agency securities — 5,994 — 5,994 Commercial papers — 50,912 — 50,912 Total cash equivalents 22,106 66,891 — 88,997 Marketable securities Marketable securities, current U.S. treasury securities — 199,626 — 199,626 U.S. government agency securities — 20,600 — 20,600 Commercial papers — 16,988 — 16,988 Corporate debt securities — 20,688 — 20,688 Total marketable securities, current — 257,902 — 257,902 Marketable securities, long-term U.S. treasury securities — 80,412 — 80,412 Corporate debt securities — 47,922 — 47,922 U.S. government agency securities — 23,429 — 23,429 Total marketable securities, long-term — 151,763 — 151,763 Total cash equivalents and marketable securities $ 22,106 $ 476,556 $ — $ 498,662 There were no transfers in or out of Level 3 during the three and nine months ended September 30, 2025. December 31, 2024 Level 1 Level 2 Level 3 Total Cash equivalents Money market funds $ 6,350 $ — $ — $ 6,350 U.S. treasury securities — 19,660 — 19,660 U.S. government agency securities — 3,988 — 3,988 Commercial papers — 22,177 — 22,177 Total cash equivalents 6,350 45,825 — 52,175 Marketable securities Marketable securities, current U.S. treasury securities — 190,792 — 190,792 U.S. government agency securities — 12,966 — 12,966 Commercial papers — 34,811 — 34,811 Corporate debt securities — 75,504 — 75,504 Total marketable securities, current — 314,073 — 314,073 Marketable securities, long-term U.S. treasury securities — 13,607 — 13,607 U.S. government agency securities — 4,462 — 4,462 Total marketable securities, long-term — 18,069 — 18,069 Total cash equivalents and marketable securities $ 6,350 $ 377,967 $ — $ 384,317 8 4. Cash Equivalents and Marketable Securities The following tables summarize the cash equivalents and marketable securities, which are classified as available-for-sale as of September 30, 2025 and December 31, 2024 (in thousands): September 30, 2025 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents Money market funds $ 22,106 $ — $ — $ 22,106 U.S. treasury securities 9,985 — — 9,985 U.S. government agency securities 5,994 — — 5,994 Commercial papers 50,919 — ( 7 ) 50,912 Total cash equivalents 89,004 — ( 7 ) 88,997 Marketable securities Marketable securities, current U.S. treasury securities 199,445 186 ( 5 ) 199,626 U.S. government agency securities 20,588 12 — 20,600 Commercial papers 16,987 1 — 16,988 Corporate debt securities 20,668 20 — 20,688 Total marketable securities, current 257,688 219 ( 5 ) 257,902 Marketable securities, long-term U.S. treasury securities 80,409 29 ( 26 ) 80,412 Corporate debt securities 47,952 2 ( 32 ) 47,922 U.S. government agency securities 23,424 15 ( 10 ) 23,429 Total marketable securities, long-term 151,785 46 ( 68 ) 151,763 Total cash equivalents and marketable securities $ 498,477 $ 265 $ ( 80 ) $ 498,662 December 31, 2024 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents Money market funds $ 6,350 $ — $ — $ 6,350 U.S. treasury securities 19,656 4 — 19,660 U.S. government agency securities 3,988 — — 3,988 Commercial papers 22,180 — ( 3 ) 22,177 Total cash equivalents 52,174 4 ( 3 ) 52,175 Marketable securities Marketable securities, current U.S. treasury securities 190,748 55 ( 11 ) 190,792 U.S. government agency securities 12,967 1 ( 2 ) 12,966 Commercial papers 34,808 3 — 34,811 Corporate debt securities 75,537 7 ( 40 ) 75,504 Total marketable securities, current 314,060 66 ( 53 ) 314,073 Marketable securities, long-term U.S. treasury securities 13,639 — ( 32 ) 13,607 U.S. government agency securities 4,485 — ( 23 ) 4,462 Total marketable securities, long-term 18,124 — ( 55 ) 18,069 Total cash equivalents and marketable securities $ 384,358 $ 70 $ ( 111 ) $ 384,317 9 The following table summarizes the available-for-sale securities in an unrealized loss position, aggregated by major security type and length of time in a continuous unrealized loss position, for which an allowance for credit losses was not recorded as of September 30, 2025 and December 31, 2024 (in thousands): September 30, 2025 Less than 12 months 12 months or longer Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Cash equivalents Commercial papers $ 47,435 $ ( 7 ) $ — $ — $ 47,435 $ ( 7 ) Marketable securities Marketable securities, current U.S. treasury securities 40,679 ( 5 ) — — 40,679 ( 5 ) Marketable securities, long-term U.S. treasury securities 44,290 ( 26 ) — — 44,290 ( 26 ) Corporate debt securities 39,462 ( 32 ) — — 39,462 ( 32 ) U.S. government agency securities 11,415 ( 10 ) — — 11,415 ( 10 ) Total $ 183,281 $ ( 80 ) $ — $ — $ 183,281 $ ( 80 ) December 31, 2024 Less than 12 months 12 months or longer Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Cash equivalents Commercial papers $ 18,199 $ ( 3 ) $ — $ — $ 18,199 $ ( 3 ) Marketable securities Marketable securities, current U.S. treasury securities 49,904 ( 11 ) — — 49,904 ( 11 ) U.S. government agency securities 4,713 ( 2 ) — — 4,713 ( 2 ) Corporate debt securities 39,468 ( 40 ) — — 39,468 ( 40 ) Marketable securities, long-term U.S. treasury securities 13,607 ( 32 ) — — 13,607 ( 32 ) U.S. government agency securities 4,462 ( 23 ) — — 4,462 ( 23 ) Total $ 130,353 $ ( 111 ) $ — $ — $ 130,353 $ ( 111 ) The Company evaluated its securities for credit losses and considered the decline in market value to be primarily attributable to current economic and market conditions and not to a credit loss or other factors. Additionally, the Company does not intend to sell the securities in an unrealized loss position and it is not more likely than not that the Company will be required to sell the securities before recovery of the unamortized cost basis, which may be at maturity. There were no material realized gains or realized losses on marketable securities for the periods presented. Given the Company’s intent and ability to hold such securities until recovery, and the lack of significant change in credit risk of these investments, the Company does not consider these marketable securities to be impaired as of September 30, 2025 and December 31, 2024. As of September 30, 2025 and December 31, 2024, the Company did not record an allowance for credit losses. The following table summarizes the contractual maturities of the Company’s marketable securities at estimated fair value (in thousands): September 30, 2025 December 31, 2024 Due in one year or less $ 257,902 $ 314,073 Due in 1-2 years 151,763 18,069 Total $ 409,665 $ 332,142 10 5. Accrued Expenses and Other Current Liabilities The following table summarizes accrued expenses and other current liabilities (in thousands): September 30, 2025 December 31, 2024 Accrued research and development $ 4,787 $ 1,084 Accrued employee compensation and benefits 2,846 2,041 Accrued professional and consulting 1,015 221 Total $ 8,648 $ 3,346 6. Note Payable with Related Party In March 2024, Pre-Merger Oruka entered into a Series A Preferred Stock and Convertible Note Purchase Agreement (the “Purchase Agreement”) with Fairmount Healthcare Fund II, L.P. (“Fairmount”), whereby Pre-Merger Oruka issued a convertible note (the “Convertible Note”), with an initial principal amount of $ 25.0 million that, at the time of issuance, could be converted into Pre-Merger Oruka Series A Preferred Stock (or a series of preferred shares that is identical in respect to the shares of preferred shares issued in its next equity financing) or shares of Pre-Merger Oruka Common Stock in exchange for aggregate proceeds of $ 25.0 million. The Convertible Note accrued interest at a rate of 12.0 % per annum. Immediately prior to the completion of the Merger (see Note 1), the Convertible Note was converted into shares of Pre-Merger Oruka Common Stock based on the aggregate principal amount of $ 25.0 million, plus unpaid accrued interest of $ 1.5 million divided by the conversion price which was determined based upon the Company’s fully-diluted capitalization immediately prior to the Merger. At the effective time of the Merger, the Pre-Merger Oruka Common Stock issued upon the conversion of the Convertible Note (including accrued interest) automatically converted into 2,722,207 shares of Company Common Stock. The Company assessed all terms and features of the Convertible Note in order to identify any potential embedded features that would require bifurcation. As part of this analysis, the Company assessed the economic characteristics and risks of the embedded features. The Company determined that the share settled redemption feature was clearly and closely related to the debt host and did not require separate accounting. The Company determined that the conversion options of the Convertible Note were not clearly and closely associated with a debt host. However, these features did not meet the definition of a derivative under ASC 815, Derivatives and Hedging, and as a result, did not require separate accounting as a derivative liability. The Company paid debt issuance costs of less than $ 0.1 million in relation to the Convertible Note. The debt issuance costs were reflected as a reduction of the carrying value of Convertible Note on the consolidated balance sheet and were being amortized as interest expense over the term of the Convertible Note using the effective interest method. For the three months ended September 30, 2024 and the period from February 6, 2024 (inception) to September 30, 2024, the Company recognized interest expenses related to the Convertible Note of $ 0.5 million and $ 1.5 million, respectively, which included non-cash interest expense related to the amortization of debt issuance. As of December 31, 2024 and September 30, 2025, the Convertible Note was not outstanding. 7. Convertible Preferred Stock and Stockholders’ Equity Pre-Funded Warrants In August 2024, pursuant to the Subscription Agreement and immediately prior to the Closing, certain new and current investors purchased pre-funded warrants, which, at the effective time of the Merger, were exercisable for 5,522,207 shares of Company Common Stock at a purchase price of approximately $ 9.70 per warrant and after the Closing, are now exercisable for 5,522,207 shares of the Company Common Stock at an exercise price of $ 0.01 per share. In September 2024, in connection with the 2024 PIPE Financing, the Company issued and sold 680,000 pre-funded warrants, at a purchase price of $ 22.999 per warrant, exercisable for 680,000 shares of Company Common Stock at an exercise price of $ 0.001 per share. In September 2025, in connection with the 2025 PIPE Financing, the Company issued and sold 1,066,666 pre-funded warrants, at a purchase price of $ 14.999 per warrant, exercisable for 1,066,666 shares of Company Common Stock at an exercise price of $ 0.001 per share. The pre-funded warrants were recorded as a component of stockholders’ equity within additional paid-in-capital and have no expiration date. Collectively, 7,268,873 and 6,202,207 pre-funded warrants were outstanding as of September 30, 2025 and December 31, 2024, respectively. 11 Employee Warrants The Subscription Agreement provided for, among other things, the issuance of warrants to certain of Pre-Merger Oruka’s employees and directors immediately prior to the Closing. During the period from February 6, 2024 (inception) to December 31, 2024, 3,054,358 employee warrants were issued at an exercise price of $ 7.80 per warrant. These warrants vest over a period of four years . The Company recognizes compensation cost related to warrants on a straight-line basis over the requisite service period, which is the period in which the related services are received. 3,054,358 warrants were outstanding as of September 30, 2025 and December 31, 2024. Convertible Preferred Stock In March 2024, Pre-Merger Oruka issued and sold an aggregate of 20,000,000 shares of Pre-Merger Oruka Series A Preferred Stock to Fairmount, at a purchase price of approximately $ 0.15 per share, for aggregate gross proceeds of $ 3.0 million. Pre-Merger Oruka incurred less than $ 0.1 million of issuance costs in connection with this transaction. Upon the issuance of the Pre-Merger Oruka Series A Preferred Stock, the Company assessed the embedded conversion and liquidation features of the securities as described below and determined that such features did not require the Company to separately account for these features. In August 2024, upon Closing, the Pre-Merger Oruka Series A Preferred Stock converted to 137,138 shares of Company Series B Preferred Stock. In September 2024, in connection with the 2024 PIPE Financing, the Company issued and sold an aggregate of 2,439 shares of the Company Series A Preferred Stock at a purchase price of $ 23,000.00 per share. In November 2024, the 2,439 shares of the Company Series A Preferred Stock were converted to 2,439,000 shares of Company Common Stock. As of September 30, 2025 and December 31, 2024, there were no outstanding shares of Company Series A Preferred Stock. As of September 30, 2025, Company Series B Preferred Stock consisted of the following (in thousands, except share data): September 30, 2025 Preferred Stock Authorized Preferred Stock Issued and Outstanding Carrying Value Common Stock Issuable Upon Conversion Company Series B Preferred Stock 251,504 137,138 $ 2,931 11,428,149 Pursuant to the Certificate of Designation of Preferences, Rights and Limitations of the Series B Non-Voting Convertible Preferred Stock (the “Series B Certificate of Designation”) filed in connection with the Merger, holders of Company Series B Preferred Stock are entitled to receive dividends on shares of Company Series B Preferred Stock equal to, on an as-if-converted-to-Company Common Stock basis, and in the same form as, dividends actually paid on shares of Company Common Stock. Except as provided in the Series B Certificate of Designation or as otherwise required by law, the Company Series B Preferred Stock does not have voting rights. The Company Series B Preferred Stock shall rank on parity with the Company Common Stock as to the distribution of assets upon any liquidation, dissolution, or winding-up of the Company. Each share of Company Series B Preferred Stock is convertible at the option of the holder, at any time, and without the payment of additional consideration by the holder. As of September 30, 2025, each outstanding share of Company Series B Preferred Stock was convertible into common stock at a ratio of approximately 83.3332:1 . Paruka Warrant On December 31, 2024, the Company settled its 2024 obligations under the Paruka Warrant Obligation (defined below) by issuing Paruka Holding LLC (“Paruka”) a warrant to purchase 596,930 shares of Company Common Stock at an exercise price of $ 19.39 per share. The warrant has a term of 10 years, is fully vested, and is exercisable in part or full at any time during the term of the warrant. As of September 30, 2025, the warrant issued to settle the 2024 Paruka Warrant Obligation was outstanding and unexercised. See Note 8 for additional information on the Paruka Warrant Obligation. 12 Common Stock As of September 30, 2025, the Certificate of Incorporation provided for 545,000,000 authorized shares of Company Common Stock. As of September 30, 2025, 48,384,150 shares of Company Common Stock were issued and outstanding, including 2,207,553 shares of restricted common stock awards (“RSAs”) issued and outstanding. As of September 30, 2025 and December 31, 2024, the Company had common stock reserved for future issuance as follows: September 30, 2025 December 31, 2024 Shares issuable on conversion of Company Series B Preferred Stock 11,428,149 11,428,149 Shares issuable upon exercise of pre-funded warrants 7,268,873 6,202,207 Shares issuable upon exercise of warrant under the Paruka Warrant Obligation 596,930 596,930 Outstanding and issued stock options 3,814,560 1,567,760 Outstanding and issued employee warrants 3,054,358 3,054,358 Shares available for grant under 2024 Stock Incentive Plan 4,753,067 4,246,324 Shares available for grant under 2024 Employee Stock Purchase Plan 1,001,003 460,529 Total shares of common stock reserved 31,916,940 27,556,257 8. Stock-Based Compensation 2024 Equity Incentive Plan The 2024 Equity Incentive Plan (“2024 Plan”) was adopted by the board of directors of Pre-Merger Oruka on February 6, 2024. The 2024 Plan provided for Pre-Merger Oruka to grant stock options, restricted stock awards, restricted stock units, and other stock-based awards to employees, officers, directors, consultants, and advisors. Equity incentive stock options granted under the 2024 Plan generally vest over four years, subject to the participant’s continued service, and expire after ten years, although two non-employee stock options were granted with vesting terms less than four years. As of September 30, 2025, 1,179,193 shares were subject to options outstanding under the 2024 Plan and will become available under the 2024 Stock Incentive Plan (defined below) to the extent the options are forfeited or lapse unexercised. 2024 Stock Incentive Plan On August 22, 2024, the 2024 Stock Incentive Plan (“2024 Stock Plan”) was approved by the Company’s stockholders and on August 29, 2024, the board of directors of the Company (the “Board”) ratified the 2024 Stock Plan. The 2024 Stock Plan allows for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, other stockholder-based awards and incentive bonuses. An additional 2,753,543 shares became available for issuance under the 2024 Stock Plan on January 1, 2025 as a result of the annual increase pursuant to the evergreen provision. As of September 30, 2025, 7,388,434 shares were reserved for issuance under the 2024 Stock Plan, of which 4,753,067 shares were available for future grant and 2,635,367 shares were subject to outstanding options. 2024 Employee Stock Purchase Plan The 2024 Employee Stock Purchase Plan (the “ESPP”) became effective in August 2024. Eligible employees may purchase shares of Company Common Stock under the ESPP at 85 % of the lower of the fair market value of the Company Common Stock as of the first or the last day of each offering period. Employees are limited to contributing 15 % of the employee’s eligible compensation and may not purchase more than $ 25 ,000 of stock during any calendar year. The ESPP will terminate ten years from the first purchase date under the plan, unless terminated earlier by the Board. An additional 550,709 shares became available for issuance under the ESPP on January 1, 2025 as a result of the annual increase pursuant to the evergreen provision. The Company issued nil and 10,235 shares during the three and nine months ended September 30, 2025, respectively, out of the ESPP, and as of September 30, 2025, there were 1,001,003 shares of Company Common Stock available in the pool for future issuances. For each of the three and nine months ended September 30, 2025, the three months ended September 30, 2024, and the period from February 6, 2024 (inception) to September 30, 2024, stock-based compensation expense related to the ESPP was less than $ 0.1 million. 13 Stock Option Valuation The following table summarizes the weighted-average assumptions used in calculating the fair value of the awards for the three and nine months ended September 30, 2025 and for the three months ended September 30, 2024 and the period from February 6, 2024 (inception) to September 30, 2024: Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Nine Months Ended September 30, 2025 Period from February 6, 2024 (inception) to September 30, 2024 Expected term (in years) 6.1 6.1 6.0 6.1 Expected volatility 93.7 % 97.3 % 95.3 % 101.0 % Risk-free interest rate 3.8 % 3.5 % 4.4 % 4.3 % Expected dividend yield — — — — Stock Options The following table summarizes the stock option activities under the 2024 Plan and the 2024 Stock Plan for the nine months ended September 30, 2025: Number of Stock Options Outstanding Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value (in Thousands) Balance as of December 31, 2024 1,567,760 $ 11.39 9.4 $ 15,470 Granted 2,278,800 $ 12.24 Exercised — — Canceled/forfeited ( 32,000 ) $ 10.91 Balance as of September 30, 2025 3,814,560 $ 11.90 9.1 $ 30,938 Vested and expected to vest, September 30, 2025 3,814,560 $ 11.90 9.1 $ 30,938 Exercisable, September 30, 2025 730,123 $ 8.99 8.8 $ 7,689 The weighted average grant-date fair value per share of stock options granted during the nine months ended September 30, 2025 was $ 9.66 per share. Aggregate intrinsic value represents the difference between the estimated fair value of the underlying Company Common Stock and the exercise price of outstanding, in-the-money employee stock options. Restricted Stock Awards In February 2024 and March 2024, the Company issued 2,207,553 shares of RSAs to certain employees, directors, and consultants at a price of $ 0.0001 per share, the then par value of Pre-Merger Oruka Common Stock. Such RSAs have service-based vesting conditions only and vest over a four-year period, during which time all unvested shares are subject to forfeiture in the event the holder’s service with the Company voluntarily or involuntarily terminates. 137,972 and 852,515 RSAs vested during the three and nine months ended September 30, 2025, respectively. For each of the three and nine months ended September 30, 2025, the three months ended September 30, 2024, and the period from February 6, 2024 (inception) to September 30, 2024, stock-based compensation expense related to RSAs was less than $ 0.1 million. The following table summarizes the RSA activity for the nine months ended September 30, 2025: Number of RSAs Weighted Average Grant Date Fair Value Unvested balance as of December 31, 2024 2,207,553 $ — Granted — $ — Vested ( 852,515 ) $ — Unvested balance as of September 30, 2025 1,355,038 $ — 14 Option Agreements and Paruka Warrant Obligation As part of the Option Agreements, (defined in Note 10 below) on December 31, 2024 the Company granted, and on December 31, 2025, will grant, Paruka a warrant to purchase a number of shares equal to 1.00 % of outstanding shares as of the date of the grant on a fully-diluted basis, with an exercise price equal to the fair market value of the underlying shares on the grant date (the “Paruka Warrant Obligation”). The grant dates for the issuance of warrants were expected to be December 31, 2024 and December 31, 2025 as all terms of the award, including number of shares and exercise price, will be known by all parties. The Company determined that the 2024 and 2025 grants are two separate grants, as there would be no obligation for the 2025 grant had the Company exercised or terminated all of the options under the Option Agreements prior to December 31, 2024. The service inception period for the grant precedes the grant date, with the full award being vested as of the grant date with no post-grant date service requirement. Accordingly, the warrant expected to be granted to Paruka was accounted for as a liability on the balance sheet on the service inception date and, after the initial recognition, the liability is adjusted to fair value at the end of each reporting period, with changes in fair value recorded in the condensed consolidated statement of operations and comprehensive loss as stock-based compensation expense under research and development expenses. For the period from February 6, 2024 (inception) to September 30, 2024, $ 7.7 million was recognized as stock-based compensation expenses related to the December 31, 2024 Paruka Warrant Obligation. On issuance of the warrant to Paruka on December 31, 2024, the fair value of the warrant issued on December 31, 2024 of $ 10.4 million was reclassified from liability to equity on the condensed consolidated balance sheet as of December 31, 2024. As of September 30, 2025, the estimated fair value of the warrant to be granted on December 31, 2025 was $ 12.9 million. For the three and nine months ended September 30, 2025, $ 6.6 million and $ 9.7 million, respectively, was recognized as stock-based compensation expense related to the December 31, 2025 Paruka Warrant Obligation. As of September 30, 2025, there was $ 3.2 million in unamortized expense related to the December 31, 2025 Paruka Warrant Obligation. Employee Warrants As stated above, in July 2024, the Subscription Agreement was amended and restated, among other things, for employee warrants to be issued to certain Pre-Merger Oruka employees and directors prior to the Closing. During the period from February 6, 2024 (inception) to December 31, 2024, the Company issued 3,054,358 warrants at an exercise price of $ 7.80 per warrant, which are accounted as equity in the condensed consolidated financial statements. The employee warrants were subject to performance and service based vesting requirements and upon completion of the Merger the performance-based requirements had been achieved. During the three and nine months ended September 30, 2025, no employee warrants were granted. The following table summarizes the employee warrant activity during the nine months ended September 30, 2025: Number of Employee Warrants Outstanding Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value (in Thousands) Balance as of December 31, 2024 3,054,358 $ 7.80 9.5 $ 35,400 Granted — $ — Exercised — $ — Canceled/forfeited — $ — Balance as of September 30, 2025 3,054,358 $ 7.80 8.8 $ 34,911 Vested and expected to vest, September 30, 2025 3,054,358 $ 7.80 8.8 $ 34,911 Exercisable, September 30, 2025 1,050,013 $ 7.80 8.8 $ 12,002 15 Stock-Based Compensation Expense The following table summarizes the classification of the Company’s stock-based compensation expense in the condensed consolidated statements of operations and comprehensive loss (in thousands): Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Nine Months Ended September 30, 2025 Period from February 6, 2024 (inception) to September 30, 2024 Research and development $ 8,341 $ 7,772 $ 14,712 $ 8,310 General and administrative 1,824 1,229 5,413 1,459 Total $ 10,165 $ 9,001 $ 20,125 $ 9,769 As of September 30, 2025, total unrecognized compensation cost related to the unvested stock options was $ 28.0 million, which is expected to be recognized over a weighted average period of approximately 3.1 years. As of September 30, 2025, total unrecognized compensation cost related to the unvested RSAs was less than $ 0.1 million, which is expected to be recognized over a weighted average period of 2.4 years. As of September 30, 2025, the unrecognized compensation cost related to the employee warrants was $ 12.3 million, which is expected to be recognized over a weighted average period of 2.6 years. The following table summarizes the award types of the Company’s stock-based compensation expense in the condensed consolidated statements of operations and comprehensive loss (in thousands): Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Nine Months Ended September 30, 2025 Period from February 6, 2024 (inception) to September 30, 2024 Paruka Warrant Obligation $ 6,595 $ 7,251 $ 9,684 $ 7,681 Employee warrants 1,198 1,314 3,987 1,314 Stock options 2,314 427 6,333 765 Employee stock purchase plan 58 9 121 9 Total $ 10,165 $ 9,001 $ 20,125 $ 9,769 9. Segment Disclosures The Company operates and manages its business activities on a consolidated basis and operates in one reportable segment. The Company operates as a single reportable and operating segment. Its Chief Executive Officer , serving as the Chief Operating Decision Maker (“CODM”), oversees operations on an aggregated basis to allocate resources effectively. In assessing the Company’s financial performance, the CODM regularly reviews total operating expenses and consolidated net loss. The measure of segment assets is reported on the balance sheet as total consolidated assets. The Company’s long-lived assets consist primarily of property and equipment, net. As of September 30, 2025 and December 31, 2024 all long-lived assets were in the U.S. 16 The following table summarizes the segment loss from operations, including significant segment expenses (in thousands): Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Nine Months Ended September 30, 2025 Period from February 6, 2024 (inception) to September 30, 2024 Research and development personnel-related (excluding stock-based compensation) $ 3,774 $ 1,304 $ 9,538 $ 2,374 General and administrative personnel-related (excluding stock-based compensation) 1,945 1,206 5,356 3,131 Research and development stock-based compensation 8,341 7,772 14,712 8,310 General and administrative stock-based compensation 1,824 1,229 5,413 1,459 External research and development 15,581 15,908 45,607 37,926 Other research and development 1,292 707 3,143 947 General and administrative, excluding personnel-related and stock-based compensation 1,348 1,323 3,851 3,658 Total operating expenses $ 34,105 $ 29,449 $ 87,620 $ 57,805 Loss from operations $ ( 34,105 ) $ ( 29,449 ) $ ( 87,620 ) $ ( 57,805 ) 10. Option Agreements and License Agreements Option Agreements – Paragon Therapeutics In March 2024, the Company entered into two antibody discovery and option agreements (the “Option Agreements”) with Paragon Therapeutics, Inc. (“Paragon”) and Paruka. Under the terms of each agreement, Paragon identifies, evaluates, and develops antibodies directed against certain mutually agreed therapeutic targets of interest to the Company. From time to time, the Company can choose to add additional targets to the collaboration upon agreement with Paragon and Paruka. Under the Option Agreements, the Company has the exclusive option to, on a research program-by-research program basis, be granted an exclusive, worldwide license to all of Paragon’s rights, titles, and interest in and to the intellectual property resulting from the applicable research program to develop, manufacture, and commercialize the antibodies and products directed to the selected target(s). The Company has initiated certain research programs with Paragon that generally focus on discovering, generating, identifying and/or characterizing antibodies directed to a particular target (each, a “Research Program”), including for IL-23 and IL-17A/F for ORKA-001 and ORKA-002, respectively. The exclusive option with respect to each Research Program is exercisable at the Company’s sole discretion at such time as specified in the Option Agreements (the “Option Period”). There is no payment due upon exercise of an Option pursuant to the Option Agreements. For each of these agreements, once the Company enters into the corresponding license agreement, it will be required to make non-refundable milestone payments to Paragon of up to $ 12.0 million under each respective agreement upon the achievement of certain clinical development milestones, up to $ 10.0 million under each respective agreement upon the achievement of certain regulatory milestones, as well as a low single-digit percentage royalty for antibody products beginning on the first commercial sale in each program. The Company may terminate any Option Agreement or any Research Program at any time for any or no reason upon 30 days’ prior written notice to Paragon, provided that it must pay certain unpaid fees due to Paragon upon such termination, as well as any non-cancellable obligations reasonably incurred by Paragon in connection with its activities under any terminated Research Program. Paragon may terminate any Option Agreement or Research Program immediately upon written notice to the Company if, as a result of any action or failure to act by the Company or its affiliates, such Research Program or all material activities under the applicable Research Plan are suspended, discontinued or otherwise delayed for a certain consecutive number of months. Each party has the right to terminate the Option Agreements or any Research Program upon material breach that remains uncured or the other party’s bankruptcy. License Agreements – Paragon Therapeutics In September 2024, the Company exercised its exclusive option to acquire certain rights to ORKA-001, and in December 2024, it entered into a corresponding license agreement with Paragon (the “ORKA-001 License Agreement”), pursuant to which Paragon granted the Company a royalty-bearing, world-wide, exclusive license to develop, manufacture, commercialize, or otherwise exploit certain antibodies and products targeting IL-23 in all fields other than the field of inflammatory bowel disease (“ORKA-001 Field”). In December 2024, the Company exercised its exclusive option to acquire certain rights to ORKA-002, and in February 2025, it entered into the corresponding license agreement with Paragon (the “ORKA-002 License Agreement” and together with the ORKA-001 License Agreement, the “License Agreements”), pursuant to which Paragon granted the Company a royalty-bearing, world-wide, exclusive license to develop, manufacture, commercialize, or otherwise exploit certain antibodies and products targeting IL-17A/F in all fields (“ORKA-002 Field” and together with the ORKA-001 Field, the “Fields”). Pursuant to each of the two License Agreements, Paragon has agreed not to conduct any new campaigns that generate anti-IL-23 monospecific antibodies or anti-IL-17A/F monospecific antibodies in the respective agreed-upon fields. 17 The License Agreements provide the Company with exclusive licenses in the Fields to Paragon’s patent applications covering the related antibodies, their method of use and their method of manufacture and Paragon has agreed not to conduct any new campaigns that generate anti-IL-23 monospecific antibodies or anti-IL-17A/F monospecific antibodies for the ORKA-001 Field or the ORKA-002 Field, respectively, for at least five years. Each of the License Agreements may be terminated on 60 days’ notice to Paragon, on material breach without cure, and on a party’s insolvency or bankruptcy to the extent permitted by law. Pursuant to the terms of each of the License Agreements, the Company is obligated to pay Paragon non-refundable milestone payments of up to $ 12.0 million under each respective agreement upon the achievement of certain clinical development milestones and up to $ 10.0 million under each respective agreement upon the achievement of certain regulatory milestones. In addition, the Company is obligated to pay Paragon a low single-digit percentage royalty for antibody products for each of ORKA-001 and ORKA-002. For each of the License Agreements, the royalty term ends on the later of (i) the last-to-expire licensed patent or our patent directed to the manufacture, use or sale of a licensed antibody in the country at issue or (ii) 12 years from the date of first sale of a Company product. There is also a royalty step-down if there is no Paragon patent in effect during the royalty term for each program. Each of the License Agreements may be terminated on 60 days’ notice to Paragon, on material breach without cure, and on a party’s insolvency or bankruptcy to the extent permitted by law. As of September 30, 2025, the Company has incurred and expensed milestone payments of $ 7.0 million and $ 4.0 million in connection with the ORKA-001 License Agreement and the ORKA-002 License Agreement, respectively. Additionally, as part of the Option Agreements, on December 31, 2024 the Company granted and on December 31, 2025, will grant Paruka a warrant to purchase a number of shares equal to 1.00 % of outstanding shares as of the date of the grant on a fully-diluted basis, with an exercise price equal to the fair market value of the underlying shares on the grant date. Pursuant to the Option Agreements, on a research program-by-research program basis following the finalization of the research plan for each respective research program, the Company is required to pay certain initiation fees, development costs and milestone payments to Paragon. For the ORKA-001 program, the Company recognized research and development expenses related to the following milestones during the period from February 6, 2024 (inception) to December 31, 2024: a one-time, nonrefundable research initiation fee of $ 0.8 million; $ 1.5 million related to exercising its option and achievement of development candidate; and $ 2.5 million related to completing the first dosing of a human subject in a Phase 1 trial. The Company was responsible for 50 % of the development costs incurred through the completion of the IL-23 selection process, which was completed in June 2024. For the ORKA-002 program, the Company recognized research and development expenses related to the following milestones during the period from February 6, 2024 (inception) to December 31, 2024: a one-time, nonrefundable research initiation fee of $ 0.8 million and $ 1.5 million related to exercising its option and achievement of development candidate. The Company was responsible for the development costs incurred through the completion of the IL-23 selection process, which was completed in December 2024. Pursuant to the Option Agreements, for each of the three and nine months ended September 30, 2025, the Company’s share of research and development expenses for the ORKA-001 program were nil . For the three months ended September 30, 2024, and the period from February 6, 2024 (inception) to September 30, 2024, the Company’s share of research and development expenses, including the research initiation fee, incurred for the ORKA-001 program were $ 0.8 million and $ 14.0 million, respectively. The Company recognized a milestone payment of $ 3.0 million related to completing the first dosing of a human patient in a Phase 2 trial milestone during the three and nine months ended September 30, 2025. These costs were recorded as research and development expenses. As of September 30, 2025 and December 31, 2024, nil and $ 12.4 million, respectively, related to ORKA-001 were included in related party accounts payable and other current liabilities. Pursuant to the Option Agreements, during the three and nine months ended September 30, 2025, the Company’s share of research and development expenses for the ORKA-002 program was nil and $ 0.1 million, respectively. For the three months ended September 30, 2024, and the period from February 6, 2024 (inception) to September 30, 2024, the Company’s share of research and development expense, including the research initiation fee, incurred for the ORKA-002 program were $ 3.8 million and $ 10.7 million, respectively. The Company recognized a milestone payment of nil and $ 2.5 million related to completing the first dosing of a human subject in a Phase 1 trial milestone during the three and nine months ended September 30, 2025, respectively. These costs were recorded as research and development expenses. As of September 30, 2025 and December 31, 2024, nil and $ 2.7 million, respectively, related to ORKA-002 were included in related party accounts payable and other current liabilities. For the three and nine months ended September 30, 2025, the Company recognized $ 9.6 million and $ 15.3 million, respectively, of expenses in connection with services provided by Paragon and Paruka under the Option Agreements. For the three months ended September 30, 2024, and the period from February 6, 2024 (inception) to September 30, 2024, the Company recognized $ 13.4 million and $ 33.8 million, respectively. 18 The Company expenses the service fees as the associated costs are incurred when the underlying services are rendered. Such amounts are classified within research and development expenses in the accompanying condensed consolidated statements of operations and comprehensive loss. The Company concluded that the rights obtained under the Option Agreements represent an asset acquisition whereby the underlying assets comprise in-process research and development assets with no alternative future use. The Option Agreements did not qualify as a business combination because substantially all of the fair value of the assets acquired was concentrated in the exclusive license options, which represent a group of similar identifiable assets. The research initiation fee represents a one-time cost on a research program-by-research program basis for accessing research services or resources with benefits that are expected to be consumed in the near term, therefore the amounts paid are expensed as part of research and development costs immediately. Amounts paid as reimbursements of ongoing development cost, monthly development cost fee and additional development expenses incurred by Paragon due to work completed for selected targets prior to the effective date of the Option Agreements that is associated with services being rendered under the related Research Programs are recognized as research and development expense when incurred. 11. Commitments and Contingencies Leases In April 2024, the Company entered into an operating lease agreement for the Company’s headquarters in Menlo Park, California, which commenced on June 15, 2024 with an initial term of 39.5 months. In February 2025, the Company entered into an operating lease agreement in Waltham, Massachusetts, which commenced on April 1, 2025 with an initial term of 54 months. The Company leases office spaces under noncancelable operating lease agreements. Lease liabilities are based on the net present value of the remaining lease payments over the remaining lease terms. In determining the present value of lease payments, the Company used its incremental borrowing rate when measuring operating lease liabilities as discount rates were not implicit or readily determinable. For the three and nine months ended September 30, 2025, the Company recorded operating and variable lease expenses of $ 0.2 million and $ 0.6 million, respectively, in general and administrative expenses in its condensed consolidated statement of operations and comprehensive loss. For the three months ended September 30, 2024 and the period from February 6, 2024 (inception) to September 30, 2024, the Company recorded operating and variable lease expenses of $ 0.1 million and $ 0.2 million, respectively, in general and administrative expenses in its condensed consolidated statement of operations and comprehensive loss. The following table presents the Company’s supplemental cash flow information related to leases (in thousands): Nine Months Ended September 30, 2025 Cash paid for amounts included in the measurement of lease liabilities $ 657 The following table summarizes a maturity analysis of the Company’s net operating lease liabilities showing the aggregate lease payments as of September 30, 2025 (in thousands): Year ending December 31, Amount 2025 (net of leasehold incentives receivable) (remainder of the year) $ 42 2026 822 2027 768 2028 397 2029 304 Total undiscounted lease payments 2,333 Less: imputed interest ( 421 ) Total discounted lease payments 1,912 Less: current portion of lease liability ( 419 ) Non-current portion of lease liability $ 1,493 Cell Line License Agreement In March 2024, the Company entered into the Cell Line License Agreement (the “Cell Line License Agreement”) with WuXi Biologics Ireland Limited (“WuXi Biologics”). Under the Cell Line License Agreement, the Company received a non-exclusive, worldwide, sublicensable license to certain of WuXi Biologics’ know-how, cell line, biological materials (the “WuXi Biologics Licensed Technology”) and media and feeds to make, have made, use, sell and import certain therapeutic products produced through the use of the cell line licensed by WuXi Biologics under the Cell Line License Agreement (the “WuXi Biologics Licensed Products”). Specifically, the WuXi Biologics Licensed Technology is used in certain manufacturing activities in support of the ORKA-001 and ORKA-002 programs. 19 In consideration for the license, the Company agreed to pay WuXi Biologics a non-refundable license fee of $ 150,000 , which was recognized as a research and development expense during the period from February 6, 2024 (inception) to December 31, 2024. Additionally, to the extent that the Company manufactures its commercial supplies of bulk drug product with a manufacturer other than WuXi Biologics or its affiliates, the Company is required to make royalty payments to WuXi Biologics at a rate of less than one percent of net sales of WuXi Biologics Licensed Products manufactured by the third-party manufacturer. Pursuant to an amendment to the Cell Line License Agreement effective in November 2024, a provision was added that permits the royalties owed under the agreement to be bought out on a product-by-product basis for a lump-sum payment. The Cell Line License Agreement will continue indefinitely unless terminated (i) by the Company upon six months’ prior written notice and its payment of all undisputed amounts due to WuXi Biologics through the effective date of termination, (ii) by WuXi Biologics for a material breach by the Company that remains uncured for 60 days after written notice, (iii) by WuXi Biologics if the Company fails to make a payment and such failure continues for 30 days after receiving notice of such failure, or (iv) by either party upon the other party’s bankruptcy. Legal Proceedings The Company is not currently party to any material legal proceedings. At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of FASB ASC Topic 450, Contingencies (“ASC 450”). The Company expenses as incurred the costs related to its legal proceedings. 12. Net Loss per Share The following table summarizes the basic and diluted net loss per share attributable to stockholders (in thousands, except share and per share data): Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Loss Allocation Weighted Average Shares Outstanding Loss Per Share, Basic and Diluted Loss Allocation Weighted Average Shares Outstanding Loss Per Share, Basic and Diluted Common Stock $ ( 24,042 ) 44,067,059 $ ( 0.55 ) $ ( 21,936 ) 15,013,655 $ ( 1.46 ) Company Series A Preferred Stock (1) — — $ — ( 697 ) 477 $ ( 1,461.10 ) Company Series B Preferred Stock (2) ( 6,235 ) 137,138 $ ( 45.46 ) ( 5,990 ) 49,191 $ ( 121.76 ) Net loss $ ( 30,277 ) $ ( 28,623 ) (1) The weighted-average number of shares of as-converted Company Series A Preferred Stock used in the loss allocation was nil and 477,196 for the three months ended September 30, 2025 and September 30, 2024, respectively. (2) The weighted-average number of shares of as-converted Company Series B Preferred Stock used in the loss allocation was 11,428,129 and 4,099,227 for the three months ended September 30, 2025 and September 30, 2024, respectively. Nine Months Ended September 30, 2025 Period from February 6, 2024 (inception) to September 30, 2024 Loss Allocation Weighted Average Shares Outstanding Loss Per Share, Basic and Diluted Loss Allocation Weighted Average Shares Outstanding Loss Per Share, Basic and Diluted Common Stock $ ( 59,813 ) 42,622,935 $ ( 1.40 ) $ ( 47,192 ) 7,765,381 $ ( 6.08 ) Company Series A Preferred Stock (1) — — $ — ( 1,121 ) 184 $ ( 6,077.25 ) Company Series B Preferred Stock (2) ( 16,037 ) 137,138 $ ( 116.94 ) ( 9,630 ) 19,015 $ ( 506.44 ) Net loss $ ( 75,850 ) $ ( 57,943 ) (1) The weighted-average number of shares of as-converted Company Series A Preferred Stock used in the loss allocation was nil and 184,462 for the nine months ended September 30, 2025 and the period from February 6, 2024 (inception) to September 30, 2024, respectively. (2) The weighted-average number of shares of as-converted Company Series B Preferred Stock used in the loss allocation was 11,428,129 and 1,584,575 for the nine months ended September 30, 2025 and the period from February 6, 2024 (inception) to September 30, 2024, respectively. 20 For the computation of basic net loss per share attributable to stockholders, the amount of weighted-average shares outstanding excludes all shares of unvested restricted common stock as such shares are not considered outstanding for accounting purposes until vested. The amount of weighted-average shares outstanding includes the pre-funded warrants as the exercise price is negligible and these warrants are fully vested and exercisable. The potential shares of common stock that were excluded from the computation of diluted net loss per share attributable to stockholders for the periods presented because including them would have had an anti-dilutive effect were as follows: Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Nine Months Ended September 30, 2025 Period from February 6, 2024 (inception) to September 30, 2024 Outstanding employee warrants to purchase common stock 3,054,358 3,054,358 3,054,358 3,054,358 Outstanding unvested restricted stock awards 1,355,038 2,207,553 1,355,038 2,207,553 Outstanding and issued common stock options 3,814,560 1,287,760 3,814,560 1,287,760 Outstanding and issued warrant to Paruka 596,930 — 596,930 — Total 8,820,886 6,549,671 8,820,886 6,549,671 13. Related Party Transactions Paragon and Paruka each beneficially own less than 5% of the Company’s capital stock through their respective holdings of Company Common Stock. Fairmount beneficially owns more than 5% of the Company’s capital stock, currently has one representative appointed to the Board, and beneficially owns more than 5% of Paragon. Fairmount appointed Paragon’s board of directors and has the contractual right to approve the appointment of any executive officers of Paragon. The following is a summary of related party accounts payable and other current liabilities (in thousands): September 30, 2025 December 31, 2024 Paragon reimbursable Option Agreements’ fees $ — $ 1,482 Paragon milestone payments for License Agreement — 4,000 Paragon reimbursable other research expenses — 515 Paragon reimbursable patent expenses 8 25 Total $ 8 $ 6,022 14. Income Taxes On July 4, 2025, the One Big Beautiful Bill Act (the “Act”) was signed into law. The Act makes permanent key elements of the Tax Cuts and Jobs Act, including 100 % bonus depreciation, domestic research cost expensing, and the business interest expense limitation. The Company evaluated the income tax effects of the Act and determined that the provisions did not have a material impact on its 2025 consolidated financial statements. 21