What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2025-08-12 compared with 2025-05-13 · 125 added, 90 removed, 236 unchanged (48% of the section changed)

18 unchanged sentences

We have received positive regulatory feedback on the clinical pathway to treating FTD- C9orf72 patients and ALS patients with PBFT02.

We are proceeding with clinical development of PBFT02 in FTD- C9orf72 patients and plan to initiate dosing in the first half of 2025.

Research Developments

We have entered into a series of sublicense agreements with Gemma Biotherapeutics, Inc., or Gemma, a newly formed genetic medicines company co-founded by Dr.

James Wilson in connection with the outlicensing of PBGM01 for the treatment of GM1 gangliosidosis, or GM1, PBKR03 for the treatment of Krabbe disease, and PBML04 for the treatment of metachromatic leukodystrophy, or MLD, collectively the Outlicensed Programs, and such agreements, the Gemma Sublicenses.

We are proceeding with clinical development of PBFT02 in FTD- C9orf72 patients, and plan to begin patient enrollment upon site review and acceptance of the amended upliFT-D clinical trial protocol.

We are party to a series of sublicense agreements, as amended, with Gemma Biotherapeutics, Inc., or Gemma, a newly formed genetic medicines company co-founded by Dr.

In addition, we have entered into a Transition Services Agreement, as amended, and a research, collaboration and license agreement, or the Gemma Collaboration Agreement, with Gemma.

We refer to the Gemma Sublicenses, the Transition Services Agreement, and the Gemma Collaboration Agreement, collectively, as the Outlicense Transaction Agreements.

collaboration with Penn’s Gene Therapy Program, or GTP.

This collaboration provided access to differentiated scientific expertise for the conduct of rigorous preclinical studies to generate promising product candidates.

We refer to the Amended Gemma Sublicenses, the Transition Services Agreement, and the Gemma Collaboration Agreement, collectively, as the Outlicense Transaction Agreements.

Prior to the execution of the Outlicense Transaction Agreements, we progressed four product candidates from preclinical to clinical stage development and had one active preclinical program in Huntington’s disease through our research collaboration with the Trustees of the University of Pennsylvania’s, or Penn’s, Gene Therapy Program, or GTP.

This collaboration provided access to differentiated scientific expertise for the conduct of rigorous preclinical studies to

generate promising product candidates.

Gemma is comprised of a core research team from GTP and is continuing the same approach to preclinical development to support the continued development of our preclinical Huntington’s disease program.

14 unchanged sentences

We are conducting our upliFT-D trial, an international, multi-center, open-label, single-arm Phase 1/2 clinical trial of PBFT02 in patients with a diagnosis of symptomatic FTD- GRN .

In January 2025, we reported biomarker data from patients in our upliFT-D trial who received Dose 1 of PBFT02 (3.3e10 genome copies/g estimated brain weight, or 4.50e13 total genome copies).

Dose 1 of PBFT02 resulted in robust and durable increases in CSF PGRN levels, with concentrations increasing from below 3.0 ng/mL at baseline to 8.0 to 17.3 ng/mL at 30 days post-treatment (n=6), 13.2 to 27.3 ng/mL at six months post-treatment (n=4), and 22.3 to 34.0 ng/mL at 12 months post-treatment (n=2).

CSF PGRN levels generally plateaued by 6 months post-treatment and have remained durable through the longest available follow-up of 18 months post-treatment (n=1).

In June 2025, we reported biomarker data from patients in our upliFT-D trial.

Dose 1 of PBFT02 (3.3e10 genome copies/g estimated brain weight, or 4.5e13 total genome copies) resulted in robust and durable increases in CSF PGRN levels, with concentrations increasing from below 3.0 ng/mL at baseline to a mean of 12.4 ng/mL at one month (n=7), 19.4 ng/mL at six months (n=6), 25.9 ng/mL at 12 months (n=4), and 23.8 ng/mL at 18 months (n=2).

These levels of CSF PGRN are higher than the range found in healthy adult controls of 3.3 to 8.2 ng/mL (mean=4.8 ng/mL;

In contrast, following PBFT02 administration, plasma PGRN levels were unaltered, remaining similar to baseline concentrations and

below levels found in healthy adult controls.

Dose 1 of PBFT02 also resulted in an average 13% decrease in plasma neurofilament light chain, or NfL, levels, a biomarker associated with disease progression, compared to baseline at 12 months post-treatment (n=2).

This reduction in plasma NfL after PBFT02 administration contrasts with an expected increase in plasma NfL levels of approximately 29% per year among untreated, symptomatic FTD-GRN patients, according to published natural history data (Saracino 2021).

As of April 2025, interim safety highlights from Dose 1 of PBFT02 in FTD-GRN patients (n=7) included:

● In five of seven patients, all treatment emergent adverse events were mild to moderate in severity.

● Two of seven patients experienced a total of three serious adverse events.

Patient 1 experienced the asymptomatic serious adverse events of venous sinus thrombosis, or VST, and hepatotoxicity, leading to a revised immunosuppression regiment in all subsequent patients (1,000 mg IV methylprednisolone on days 1-3 followed by 60 mg oral prednisone through day 60).

Patient 7 also experienced the serious adverse event of VST, which was asymptomatic and completely resolved prior to day 30 following treatment with anticoagulants.

Patient 7 had no evidence of hepatotoxicity, immune response, or other laboratory abnormalities.

● No evidence of clinically significant immune responses in any patient who received the revised immunosuppression regimen.

● No evidence of dorsal root ganglion toxicity, as measured by nerve conduction studies, and no complications during ICM administration were observed across any of the seven treated patients.

● Patients treated with Dose 1 of PBFT02 (n=7) have been followed up to 23 months post-dose.

Given the robust PGRN expression observed among patients who received Dose 1 of PBFT02, and to allow for dose exploration and support the program regulatory strategy, we are evaluating Dose 2, which is 50% lower than Dose 1, in subsequent FTD-GRN patients.

As of May 2025, we have treated one patient with Dose 2 of PBFT02 and enrolled a second patient.

CSF PGRN levels for the first patient treated with Dose 2 of PBFT02 (1.6e10 genome copies/g estimated brain weight, or 2.2e13 total genome copies) increased substantially from 1.5 ng/mL at baseline to 7.6 ng/mL at one month, approaching the upper limit of the range found in healthy adult controls.

In contrast, following PBFT02 administration, plasma PGRN levels were unaltered, remaining similar to baseline concentrations and below mean levels found in healthy adult

Dose 1 of PBFT02 resulted in an average 4% increase in plasma neurofilament light chain, or NfL, levels, a biomarker associated with disease progression, compared to baseline at 12 months post-treatment (n=4).

This change in plasma NfL after PBFT02 administration contrasts with an expected increase in plasma NfL levels of approximately 28% and 29% per year among untreated, symptomatic FTD- GRN patients, based on analysis of the ALLFTD natural history data and published natural history data (Saracino 2021), respectively.

As of June 2025, interim safety highlights from PBFT02 in FTD- GRN patients (n=8) included:

● In five of eight patients, all treatment emergent adverse events were mild to moderate in severity.

● Three of eight patients experienced a total of four serious adverse events, or SAE.

Patient 1 experienced the asymptomatic SAEs of venous sinus thrombosis, or VST, and hepatotoxicity.

Patient 7 also experienced the SAE of VST, which was asymptomatic and completely resolved prior to day 30 following treatment with anticoagulants.

The first Dose 2 patient (Patient 8) experienced the SAE of pulmonary embolism in the setting of a concurrent systemic infection six weeks after receiving PBFT02.

The patient responded to treatment with anticoagulants, and the SAE was assessed as possibly related to treatment.

● No evidence of dorsal root ganglion toxicity, as measured by nerve conduction studies, and no complications during ICM administration were observed across any of the eight treated patients.

As of August 2025, we have completed dosing of Cohorts 1 and 2 in the upliFT-D study.

Cohort 1 consists of 5 patients who received Dose 1 of PBFT02, and Cohort 2 consists of 4 patients, split equally between Dose 1 and Dose 2 of PBFT02.

We have amended the upliFT-D clinical trial protocol to introduce a short course of low dose prophylactic anticoagulation, a decision supported by study investigators and the Independent Data Monitoring Committee, or IDMC.

Upon review and acceptance of the amended protocol at study sites, we plan to begin enrollment in Cohort 3, which is expected to consist of five to 10 FTD- GRN patients.

We expect to deliver on the following related to our upliFT-D trial for PBFT02 for the treatment of FTD- GRN :

● Report 12-month follow-up data from Dose 1 and interim safety and biomarker data from Dose 2 in the second half of 2025;

● Seek regulatory feedback on registrational trial design in the first half of 2026.

● Seek regulatory feedback on suspension-based manufacturing process comparability in the second half of 2025;

● Report updated interim safety and biomarker data from Dose 2 in the first half of 2026;

● Seek regulatory feedback on registrational trial design in FTD-GRN in the first half of 2026.

PBFT02 for the treatment of FTD-C9orf72 and ALS

7 unchanged sentences

We anticipate that elevating neuronal PGRN levels in diseases with TDP-43 pathology may provide significant benefits to patients.

We have initiated preclinical studies to extend these initial observations.

We received positive regulatory feedback on the clinical pathway to treating FTD- C9orf72 with PBFT02 in the ongoing upliFT-D trial and amended the upliFT-D clinical trial protocol to include two cohorts of FTD- C9orf72 patients to be

enrolled sequentially.

Each cohort will consist of three to five symptomatic FTD patients with C9orf72 gene mutations and patients will initially receive Dose 2 PBFT02.

We expect to initiate dosing of FTD- C9orf72 patients in the first half of 2025.

We received positive regulatory feedback on the clinical pathway to treating FTD- C9orf72 with PBFT02 in the ongoing upliFT-D trial and revised the study to include two cohorts.

Cohorts 4 and 5 will consist of three to five symptomatic FTD patients with C9orf72 gene mutations who will initially receive Dose 2 PBFT02.

There are no disease modifying therapies approved for the treatment of FTD- C9orf72 .

Based on available literature, we estimate the prevalence of FTD- C9orf72 in the United States and Europe is approximately 21,000.

We are currently enrolling FTD- C9orf72 patients in our upliFT-D trial.

Based on available literature, we estimate the prevalence of FTD-

C9orf72 in the United States and Europe is approximately 21,000.

We plan to begin enrolling FTD- C9orf72 patients upon review and acceptance of the amended upliFT-D protocol at study sites.

Similarly, we received positive regulatory feedback on the clinical pathway to treating ALS with PBFT02.

5 unchanged sentences

Third party preclinical studies in animal models have demonstrated that low levels of PGRN may exacerbate AD pathology and, conversely, high levels of PGRN may reduce AD pathology.

We have initiated preclinical studies in AD to further explore the potential for benefit from elevated levels of PGRN.

Clinical Supply

4 unchanged sentences

Paused Research Programs

We also have a research program through the Gemma Collaboration Agreement for TLE, which was previously conducted by Penn under the Penn Agreement.

We also have a research program through the Gemma Collaboration Agreement for TLE, which was previously conducted under the research, collaboration and licensing agreement with Penn, as amended, previously the Penn Agreement and now referred to as the Penn License Agreement.

In order to reduce operating expenses, we have paused development of this program.

Reverse Stock Split

On May 28, 2025, our stockholders provided authorization for our Board of Directors to effect a reverse stock split to regain compliance with Nasdaq’s listing requirements.

On July 14, 2025, we effected a 1-for-20 reverse stock split of our common stock, or the Reverse Stock Split.

No fractional shares were issued in connection with the Reverse Stock Split.

Stockholders who were otherwise entitled to receive fractional shares received the number of shares of Common Stock as rounded up to the nearest whole share.

All share and per share amounts in the accompanying financial statements and notes thereto, including the stock options, restricted stock units, and employee stock purchase plan activity, have been adjusted retroactively to reflect the Reverse Stock Split for all periods presented.

Business Overview

3 unchanged sentences

Historically, we have funded our operations through the sale of convertible preferred stock and public offerings of common stock.

Our net losses were $15.4 million and $16.7 million for the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025, we had an accumulated deficit of $674.6 million.

Our net losses were $9.4 million and $16.0 million for the three months ended June 30, 2025 and 2024, respectively, and $24.8 million and $32.7 million for the six months ended June 30, 2025 and 2024, respectively.

As of June 30, 2025, we had

an accumulated deficit of $684.0 million.

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

1 unchanged sentence

We expect to continue to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates through all stages of development and clinical trials and, ultimately, seek regulatory approval.

In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant

commercialization expenses related to product manufacturing, marketing, sales and distribution.

In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to product manufacturing, marketing, sales and distribution.

Our net losses may fluctuate significantly from quarter to quarter and year to year, depending on the timing of our clinical trials and our expenditures on other research and development activities.

4 unchanged sentences

If we are unable to secure adequate additional funding, we may have to significantly delay, scale back or discontinue the development and commercialization of one or more product candidates or delay our pursuit of potential in-licenses or acquisitions.

As of March 31, 2025, we had cash and cash equivalents of $63.4 million.

As of June 30, 2025, we had cash and cash equivalents of $57.6 million.

We expect our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements into the first quarter of 2027.

11 unchanged sentences

In addition, on a product-by-product basis, we are obligated to make up to $55.0 million in sales milestone payments on each licensed product based on annual worldwide net sales of the licensed product in excess of defined thresholds.

Pursuant to the Gemma Sublicenses, Gemma is responsible for the payments to Penn related to the Outlicensed Programs.

Pursuant to the Amended Gemma Sublicenses, Gemma is responsible for the payments to Penn related to the Outlicensed Programs.

Upon successful commercialization of a product using the licensed technology, we are obligated to pay to Penn, on a licensed product-by-licensed product and country-by-country basis, tiered royalties (subject to customary reductions) in the mid-single digits percentage on annual worldwide net sales of such licensed product.

In addition, other than the Gemma Sublicenses, we are obligated to pay to Penn a percentage of sublicensing income, ranging from the mid-single digits to low double digits, for sublicenses under the Penn License Agreement.

The agreement will expire on a licensed product-by-licensed product and country-by-country basis upon the later of (i) the expiration of the last valid claim of the licensed patent rights that covers the exploitation of such licensed product in such country, and (ii) the expiration of the royalty period.

Pursuant to the Gemma Sublicenses, Gemma is responsible for the payments to Penn related to the Outlicensed Programs.

In addition, other than the Amended Gemma Sublicenses, we are obligated to pay to Penn a percentage of sublicensing income, ranging from the mid-single digits to low double digits, for sublicenses under the Penn License Agreement.

expiration of the royalty period.

Pursuant to the Amended Gemma Sublicenses, Gemma is responsible for the payments to Penn related to the Outlicensed Programs.

Gemma - Research, Collaboration and License Agreement

In connection with the transfer of the Outlicensed Programs, on July 31, 2024, we entered into a research, collaboration and license agreement with Gemma, or the Gemma Collaboration Agreement.

Pursuant to the Gemma Collaboration

Agreement, (i) Gemma will conduct certain preclinical and IND-enabling work for our active research program in Huntington’s disease and a currently paused research program in TLE, which were previously being conducted by Penn under the Penn Agreement and (ii) Gemma will grant us options to conduct mutually agreed research programs in four new CNS indications.

Pursuant to the Gemma Collaboration Agreement, (i) Gemma will conduct certain preclinical and IND-enabling work for our active research program in Huntington’s disease and a currently paused research program in TLE, which were previously being conducted by Penn under the Penn Agreement and (ii) Gemma will grant us options to conduct mutually agreed research programs in four new CNS indications.

The Gemma Collaboration Agreement requires that we make payments of up to (i) $16.5 million per product candidate in the aggregate for Huntington’s disease and any future CNS indications available to us under our four options and (ii) $39.0 million per product candidate in the aggregate arising from the research program for TLE.

6 unchanged sentences

Gemma - Sublicense Agreements and Transition Services Agreement

In connection with the transfer of the Outlicensed Programs to Gemma, we have entered into the Gemma Sublicenses, pursuant to which, we will receive (i) initial payments of an aggregate of $10.0 million for licenses and clinical product supply;

(ii) up to an additional $10.0 million contingent on the completion by Gemma of certain business milestones;

In connection with the transfer of the Outlicensed Programs to Gemma, on July 2024, we entered into the Gemma Sublicenses.

On May 7, 2025, we agreed to amend each of the Gemma Sublicenses to revise certain financial terms related to the Outlicensed Programs, or the Amended Gemma Sublicenses.

Pursuant to the Amended Gemma Sublicenses, we are entitled to receive (i) an aggregate total of $15.0 million in initial payments for licenses and clinical product supply, of which $5.0 million was previously received and $5.0 million of which was due in May 2025;

(ii) an additional $5.0 million contingent on Gemma completing certain business milestones;

(iii) up to an additional $114.0 million in development and commercial milestone payments;

1 unchanged sentence

In addition, Gemma is responsible for all payments to Penn related to the Outlicensed Programs under the Penn License Agreement.

On May 7, 2025, we agreed to amend each of the Gemma Sublicenses to revise certain financial terms related to the Outlicensed Programs, or the Amended Gemma Sublicenses.

Pursuant to the Amended Gemma Sublicenses, we are entitled to receive (i) an aggregate total of $15 million in initial payments for licenses and clinical product supply, of which $5 million was previously received;

and (ii) an additional $5 million contingent on Gemma completing certain business milestones.

In addition, we entered into the Transition Services Agreement, as amended by the First Amendment to the Transition Services Agreement, dated January 31, 2025, pursuant to which, we will provide transitional services at cost to Gemma through May 31, 2025, unless terminated earlier, and be entitled to reimbursement for transitional services performed retroactively from March 1, 2024, related to the transfer of the Outlicensed Programs.

As of March 31, 2025, we have collected $5.0 million in initial payments and $3.7 million in transition services payments under these agreements.

Subsequent to March 31, 2025, we have received an additional $0.4 million in transition services payments.

In addition, we entered into the Transition Services Agreement, as amended by the First Amendment to the Transition Services Agreement, dated January 31, 2025, pursuant to which, we provided transitional services at cost to Gemma through May 31, 2025, and are entitled to reimbursement for transitional services performed retroactively from March 1, 2024, related to the transfer of the Outlicensed Programs.

As of June 30, 2025, we have collected $5.0 million in initial payments and $4.7 million in transition services payments under these agreements.

Subsequent to June 30, 2025, we have applied $0.7 million in amounts owed to Gemma for the Huntington’s disease program against amounts due to us for transition services.

Collaboration and Manufacturing and Supply Agreements

14 unchanged sentences

expenses incurred under agreements with contract development and manufacturing organizations, or CDMOs, including the cost of acquiring and manufacturing preclinical study and clinical trial materials.

We track outsourced development expenses and other external research and development expenses to specific product candidates on a program-by-program basis, such as fees paid to CROs, CDMOs and research laboratories in connection with our preclinical development, process development, manufacturing and clinical development activities, expenses incurred under our prior collaboration with Penn, and future expenses incurred under the Gemma Collaboration Agreement.

We track outsourced development expenses and other external research and development expenses to specific product candidates on a program-by-program basis, such as fees paid to CROs, CDMOs and research laboratories in connection with our preclinical development, process development, manufacturing and clinical development activities, expenses incurred under our prior collaboration with Penn, and expenses incurred under the Gemma Collaboration Agreement.

However, we do not track our internal research and development expenses on a program-by-program basis as they primarily relate to compensation, lab operations and lab facility costs, and other expenses which are deployed across multiple projects under development.

8 unchanged sentences

General and administrative expenses also include professional and consulting services, headquarters facility costs, including rent, utilities, depreciation, amortization and maintenance, legal expenses related to intellectual property, litigation and corporate matters, insurance expense, expenses related to contract modifications or terminations, software expenses, expenses incurred to engage with patient advocacy organizations, and recruitment related expenses.

We expect our general and administrative expenses to decrease in the near future in connection with the reduction of our overall workforce by 55% in January 2025.

We expect our general and administrative expenses to remain consistent in the near future.

If our product candidate portfolio progresses into later-stage clinical trials, we expect that our general and administrative expenses will increase in the future to support our continued research and development activities and potential commercialization efforts.

4 unchanged sentences

We review long-lived assets, such as the right of use assets, or ROU assets, or property and equipment, for impairments when events or changes in circumstances indicate the carrying amount of the assets may not be recoverable.

During the three months ended March 31, 2025, we recognized impairment expenses related to property and equipment and certain other assets in connection with the announcement to reduce our workforce by 55% and cease our lab operations in Hopewell, New Jersey.

During the six months ended June 30, 2025, we recognized impairment expenses related to property and equipment and certain other assets in connection with the announcement to reduce our workforce by 55% and cease our lab operations in Hopewell, New Jersey.

We reassessed asset groups at the lab in Hopewell, New Jersey, and evaluated such asset groups for impairment.

3 unchanged sentences

Results of Operations

Comparison of the three months ended March 31, 2025 and 2024

The following table sets forth our results of operations for the three months ended March 31, 2025 and 2024:

Comparison of the three months ended June 30, 2025 and 2024

The following table sets forth our results of operations for the three months ended June 30, 2025 and 2024:

Three months ended

7 unchanged sentences

Research and Development Expenses

Research and development expenses decreased by $3.8 million to $7.7 million for the three months ended March 31, 2025 from $11.5 million for the three months ended March 31, 2024.

Research and development expenses decreased by $4.6 million to $5.8 million for the three months ended June 30, 2025 from $10.4 million for the three months ended June 30, 2024.

The decrease was primarily due to the following:

● a decrease of $1.6 million in preclinical research expenses primarily related to the termination of our discovery research obligation under the Penn Agreement;

● a decrease of $1.8 million in preclinical research expenses primarily related to the termination of our discovery research obligation under the Penn Agreement and reduced Huntington’s disease program expenses;

● a decrease of $1.6 million in wages and benefits due to a lower headcount from the restructuring in January 2025;

● a decrease of $0.6 million in facility and other expenses related to decreased depreciation expenses in connection with the disposal of our laboratory equipment;

● a decrease of $0.5 million in share-based compensation expense related to reductions in headcount;

● a decrease of $0.4 million in chemistry, manufacturing and control expenses primarily related to reduced costs in connection with the restructuring and ceased use of the lab in Hopewell, New Jersey;

● a decrease of $0.3 million in professional fees.

These decreases were partially offset by:

● an increase of $0.6 million in clinical operations expenses driven by increased activity supporting the FTD program and closing out the GM1 program.

General and Administrative Expenses

General and administrative expenses decreased by $2.0 million to $4.5 million for the three months ended June 30, 2025 from $6.5 million for the three months ended June 30, 2024.

The decrease was primarily due to the following:

● a decrease of $1.3 million in professional fees;

● a decrease of $0.4 million and $0.2 million in wages and benefits and share-based compensation expense, respectively, related to reductions in headcount;

● a decrease of $0.1 million in facility and other expenses.

Impairment of Long-Lived Assets

During the three months ended June 30, 2025, we did not record any impairment expense.

During the three months ended June 30, 2024, we recorded $0.4 million of impairment expenses related to property and equipment for a construction in progress asset.

Other Income (Expense), Net

Other income (expense), net decreased by $0.4 million to $1.0 million for the three months ended June 30, 2025 from $1.4 million for the three months ended June 30, 2024.

The decrease was primarily due to the following:

● a decrease of $0.6 million attributable to interest income and the amortization of premium and discount on our marketable securities.

The decrease was partially offset by:

● an increase of $0.2 million attributable to income from subleases.

Comparison of the six months ended June 30, 2025 and 2024

The following table sets forth our results of operations for the six months ended June 30, 2025 and 2024:

Six months ended

(in thousands)

Operating expenses:

Research and development

General and administrative

Impairment of long-lived assets

Loss from operations

Other income (expense), net

Research and Development Expenses

Research and development expenses decreased by $8.4 million to $13.6 million for the six months ended June 30, 2025 from $22.0 million for the six months ended June 30, 2024.

The decrease was primarily due to the following:

● a decrease of $3.4 million in preclinical research expenses primarily related to the termination of our discovery research obligation under the Penn Agreement and reduced Huntington’s disease program expenses;

● a decrease of $1.5 million in wages and benefits due to a lower headcount from the restructuring in January 2025;

● a decrease of $1.2 million in facility and other expenses related to decreased depreciation expenses in connection with the disposal of our laboratory equipment;

● a decrease of $1.1 million in share-based compensation expense related to reductions in headcount;

● a decrease of $0.9 million in chemistry, manufacturing and control expenses primarily related to reduced costs in connection with the restructuring and ceased use of the lab in Hopewell, New Jersey;

● a decrease of $0.6 million in professional fees.

● a decrease of $0.3 million in clinical operations expenses driven by lower activity in supporting the GM1 program, partially offset by increased activity for FTD;

These decreases were partially offset by:

● an increase of $0.2 in wages and benefits related to severance costs incurred in the three months ended March 31, 2025 partially offset by lower headcount for a portion of the period.

● an increase of $0.3 million in clinical operations expenses driven by increased activity for the FTD program, partially offset by decreased activity in supporting the GM1 program.

General and Administrative Expenses

General and administrative expenses decreased by $0.4 million to $6.1 million for the three months ended March 31, 2025 from $6.5 million for the three months ended March 31, 2024.

General and administrative expenses decreased by $2.4 million to $10.6 million for the six months ended June 30, 2025 from $13.0 million for the six months ended June 30, 2024.

The decrease was primarily due to the following:

2 unchanged sentences

● a decrease of $0.2 million in facility and other expenses.

These decreases were partially offset by:

● an increase of $0.5 million wages and benefits related to severance costs incurred in the three months ended March 31, 2025 partially offset by lower headcount for a portion of the period.

Impairment of Long-Lived Assets

During the three months ended March 31, 2025, we recorded $2.6 million of impairment expense related to laboratory equipment and certain other assets which were revalued and subsequently sold from the Hopewell Laboratory Space.

During the three months ended March 31, 2024, we did not record any impairment expense.

During the six months ended June 30, 2025, we recorded $2.6 million of impairment expense related to laboratory equipment and certain other assets which were revalued and subsequently sold from the Hopewell Laboratory Space.

During the six months ended June 30, 2024, we recorded $0.4 million of impairment expenses related to property and equipment for a construction in progress asset.

Other Income (Expense), Net

Other income (expense), net decreased by $0.2 million to $1.1 million for the three months ended March 31, 2025 from $1.3 million for the three months ended March 31, 2024.

Other income (expense), net decreased by $0.7 million to $2.0 million for the six months ended June 30, 2025 from $2.7 million for the six months ended June 30, 2024.

The decrease was primarily due to the following:

3 unchanged sentences

Liquidity and Capital Resources

As of March 31, 2025, we had $63.4 million in cash and cash equivalents and had an accumulated deficit of $674.6 million.

As of June 30, 2025, we had $57.6 million in cash and cash equivalents and had an accumulated deficit of $684.0 million.

We expect our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements into the first quarter of 2027.

23 unchanged sentences

On March 5, 2021, we entered into a Sales Agreement, or the Sales Agreement, with Cowen and Company, LLC, or Cowen, relating to the applicable terms of at-the-market equity offerings, or the ATM Facility, pursuant to which we may, but are not obligated to, offer and sell, from time to time, shares of our common stock with an aggregate offering price up to $125.0 million through Cowen, as sales agent in the ATM Facility.

We issued 6,000,000 shares of common stock under the ATM Facility, resulting in net proceeds of $8.7 million, after deducting offering costs of $0.3 million in March 2024.

We are limited to $15.8 million in our capacity to offer and sell shares of our common stock under this sales agreement pursuant to the prospectus supplement to our shelf registration statement on Form S-3, filed on March 5, 2025.

As of March 31, 2025, $15.8 million of capacity remains available to be sold under the ATM Facility.

We issued 6,000,000 shares (300,000 shares adjusted for the Reverse Stock Split) of common stock under the ATM Facility, resulting in net proceeds of $8.7 million, after deducting offering costs of $0.3 million in March 2024.

We are limited in our capacity to offer and sell shares of our common stock under this sales agreement pursuant to the prospectus supplement to our shelf registration statement on Form S-3, filed on March 5, 2025.

As of June 30, 2025, $15.8 million of capacity remains available to be sold under the ATM Facility.

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

Three months ended

Six months ended

(in thousands)

4 unchanged sentences

Net Cash Provided by (Used in) Operating Activities

During the three months ended March 31, 2025, we used $13.8 million of net cash in operating activities.

During the six months ended June 30, 2025, we used $20.2 million of net cash in operating activities.

Cash used in operating activities reflected a net loss of $24.8 million and a decrease in our operating assets of $0.3 million, partially offset by non-cash charges of $4.9 million related to depreciation, amortization, share-based compensation, amortization of premium and discount, net, and impairment of long-lived assets.

The primary use of cash was to fund our operations related to the development of our product candidates.

During the three months ended March 31, 2024, we used $18.9 million of net cash in operating activities.

Cash used in operating activities reflected a net loss of $16.7 million and a net increase in our operating assets of $4.2 million, partially offset by net non-cash charges of $2.0 million related to depreciation, amortization, share-based compensation, and amortization of premium and discount, net.

During the six months ended June 30, 2024, we used $32.1 million of net cash in operating activities.

Cash used in operating activities reflected a net loss of $32.7 million and a net increase in our operating assets of $3.8 million, partially offset by non-cash charges of $4.4 million related to depreciation, amortization, share-based compensation, and amortization of premium and discount, net, and impairment of long-lived assets.

The primary use of cash was to fund our operations related to the development of our product candidates.

Net Cash Provided by (Used in) Investing Activities

During the three months ended March 31, 2025 , we had sales and maturities of $39.0 million in marketable securities and received cash proceeds of $0.6 million related to the sale of property and equipment and certain other assets.

During the three months ended March 31, 2024, we purchased $13.8 million in marketable securities, and had sales and maturities of $39.1 million in marketable securities.

We did not make any purchases of property and equipment for the three months ended March 31, 2025 and 2024.

During the six months ended June 30, 2025 , we had sales and maturities of $39.0 million in marketable securities and received cash proceeds of $1.2 million related to the sale of property and equipment and certain other assets.

During the six months ended June 30, 2024, we purchased $50.8 million in marketable securities, and had sales and maturities of $77.1 million in marketable securities.

We did not make any purchases of property and equipment for the six months ended June 30, 2025 and 2024.

Net Cash Provided by (Used in) Financing Activities

During the three months ended March 31, 2025, we had no gross receipts or outflows of cash related to financing activities.

During the three months ended March 31, 2024, we received $8.7 million in net proceeds from the issuance of common stock under the ATM Facility.

We received gross proceeds of $9.0 million, net of offering costs of $0.3 million.

During the six months ended June 30, 2025, we received de minimis proceeds from the issuance of common stock under the ESPP.

During the six months ended June 30, 2024, we received $8.7 million in net proceeds from the issuance of common stock under the ATM Facility.

We also received gross proceeds of $9.0 million, net of offering costs of $0.3 million.

We received $0.1 million in proceeds from the issuance of common stock under the ESPP and exercises of employee stock options.

Contractual Obligations and Other Commitments

2 unchanged sentences

We have an option to extend the term of the lease by up to two additional five-year terms.

The aggregate estimated rent payments due over the initial term of the lease is $11.8 million, with rent payments that began in 2022.

Our sublease agreements do not relieve us from our primary obligations under the 2005 Market Street Lease Agreement, however, we do expect cash inflows from the agreements to partially offset our future obligations for the duration of the sublease agreements.

2 unchanged sentences

We have an option to extend the term of the sublease by three and a half years through February 2029.

The aggregate estimated rent payments due over the initial term of the sublease is approximately $0.5 million, with rent payments that began in 2024.

We lease approximately 62,000 square feet of laboratory space in Hopewell, New Jersey, or the Laboratory Lease Agreement.

The lease will expire in March 2036.

The aggregate estimated rent payments due over the initial term of the lease is approximately $40.3 million, with rent payments that began in 2021.

Our sublease agreement does not relieve us from our primary obligations under the Laboratory Lease Agreement, however, we do expect cash inflows from the agreement to partially offset our future obligations for the duration of the sublease agreement.

The aggregate estimated rent payments due over the remaining terms of our leases and sublease are $39.2 million.

Under the exclusive relationship under the Amended Catalent Agreements, following certain conditional events related to the divestiture by us of either FTD or GM1, we would pay Catalent certain fees.

3 unchanged sentences

The contractual obligations and commitments above do not include any potential milestone or royalty payments that we may be required to make under the Penn License Agreement.

Under the Gemma Sublicenses, Gemma will be responsible for all potential milestone and royalty payments to Penn for the Outlicensed Programs.

Under the Amended Gemma Sublicenses, Gemma will be responsible for all potential milestone and royalty payments to Penn for the Outlicensed Programs.

The contractual obligations and commitments above do not include any potential milestone or royalty payments that we may be required to make under the Gemma Collaboration Agreement.

Critical Accounting Policies and Estimates

During the three months ended March 31, 2025, there were no material changes to our critical accounting policies and estimates from those described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” in our 2024 Annual Report filed on Form 10-K.

During the six months ended June 30, 2025, there were no material changes to our critical accounting policies and estimates from those described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” in our 2024 Annual Report filed on Form 10-K.

JOBS Act Accounting Election

13 unchanged sentences

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis