What changed in this filing

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Item 1. Financial Statements

2025-11-06 compared with 2025-08-07 · 265 added, 265 removed, 1225 unchanged (30% of the section changed)

5 unchanged sentences

( unaudited )

June 30, 2025

September 30, 2025

December 31, 2024

35 unchanged sentences

Long-term debt, net

10,869 21,719

Other liabilities, long-term

5 unchanged sentences

100,000,000 shares authorized;

49,892,725 shares issued and outstanding at June 30, 2025 and 49,105,834 issued and outstanding at December 31, 2024

50,384,274 shares issued and outstanding at September 30, 2025 and 49,105,834 issued and outstanding at December 31, 2024

Additional paid-in capital

1,412,457 1,407,000

Accumulated other comprehensive (loss) income

Accumulated other comprehensive income

Accumulated deficit

10 unchanged sentences

( unaudited )

For the Three Months Ended June 30,

For the Six Months Ended June 30,

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

Product revenue, net

13 unchanged sentences

44,902 58,463 132,725 153,790

Income (loss) from operations

Income from operations

9,573 22,079 20,193 17,601

7 unchanged sentences

( 330 ) ( 1,471 ) ( 1,518 ) ( 5,739 )

Net income (loss) before income taxes

Net income before income taxes

$ 9,243 $ 20,608 $ 18,675 $ 11,862

1 unchanged sentence

( 399 ) ( 291 ) ( 1,002 ) ( 889 )

Net income (loss)

$ 8,844 $ 20,317 $ 17,673 $ 10,973

Net income (loss) per share of common stock—basic

Net income per share of common stock—basic

$ 0.18 $ 0.41 $ 0.35 $ 0.23

Net income (loss) per share of common stock—diluted

Net income per share of common stock—diluted

$ 0.17 $ 0.41 $ 0.35 $ 0.22

6 unchanged sentences

AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

For the Three Months Ended June 30,

For the Six Months Ended June 30,

Net income (loss)

$ 5,855 $ ( 4,529 ) $ 8,829 $ ( 9,344 )

Other comprehensive income (loss):

Unrealized loss on available-for-sale securities, net of tax of $ 0

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

$ 8,844 $ 20,317 $ 17,673 $ 10,973

Comprehensive income (loss)

Other comprehensive income:

Unrealized gain on available-for-sale securities, net of tax of $ 0

Comprehensive income

$ 8,877 $ 20,375 $ 17,686 $ 11,003

4 unchanged sentences

(in thousands, except share data)

For the Three Months Ended June 30, 2025

For the Three Months Ended September 30, 2025

Comprehensive

Balance at March 31, 2025

49,615,174 $ 5 1,409,026 ( 11 ) ( 1,311,912 ) 97,108

Income (Loss)

Balance at June 30, 2025

Stock-based compensation

— — 1,628 — — 1,628

Shares issued or restricted stock units vested under employee stock plans

277,551 — 130 — — 130

Unrealized loss on available-for-sale securities

— — — ( 3 ) — ( 3 )

— — — — 5,855 5,855

Balance at June 30, 2025

49,892,725 $ 5 $ 1,410,784 $ ( 14 ) $ ( 1,306,057 ) $ 104,718

For the Three Months Ended June 30, 2024

Unrealized gain on available-for-sale securities

Balance at September 30, 2025

For the Three Months Ended September 30, 2024

Comprehensive

Balance at March 31, 2024

48,214,663 $ 5 $ 1,400,982 $ ( 26 ) $ ( 1,349,979 ) 50,982

Income (Loss)

Balance at June 30, 2024

Stock-based compensation

— — 2,062 — — 2,062

Shares issued or restricted stock units vested under employee stock plans

245,457 — — — — —

Unrealized loss on available-for-sale securities

— — — ( 6 ) — ( 6 )

— — — — ( 4,529 ) ( 4,529 )

Balance at June 30, 2024

48,460,120 $ 5 $ 1,403,044 $ ( 32 ) $ ( 1,354,508 ) $ 48,509

Unrealized gain on available-for-sale securities

Balance at September 30, 2024

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements

3 unchanged sentences

(in thousands, except share data)

For the Six Months Ended June 30, 2025

For the Nine Months Ended September 30, 2025

Comprehensive

Income (Loss)

Balance at December 31, 2024

49,105,834 $ 5 $ 1,407,000 $ 6 $ ( 1,314,886 ) $ 92,125

Stock-based compensation

— — 3,654 — — 3,654

Shares issued or restricted stock units vested under employee stock plans

786,891 — 130 — — 130

Unrealized loss on available-for-sale securities

— — — ( 20 ) — ( 20 )

— — — — 8,829 8,829

Balance at June 30, 2025

49,892,725 $ 5 $ 1,410,784 $ ( 14 ) $ ( 1,306,057 ) $ 104,718

For the Six Months Ended June 30, 2024

Unrealized gain on available-for-sale securities

Balance at September 30, 2025

For the Nine Months Ended September 30, 2024

Comprehensive

Income (Loss)

Balance at December 31, 2023

47,646,787 $ 5 $ 1,398,605 $ ( 4 ) $ ( 1,345,164 ) $ 53,442

Stock-based compensation

— — 4,439 — — 4,439

Shares issued or restricted stock units vested under employee stock plans

813,333 — — — — —

Unrealized loss on available-for-sale securities

— — — ( 28 ) — ( 28 )

— — — — ( 9,344 ) ( 9,344 )

Balance at June 30, 2024

48,460,120 $ 5 $ 1,403,044 $ ( 32 ) $ ( 1,354,508 ) $ 48,509

Unrealized gain on available-for-sale securities

Balance at September 30, 2024

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements

3 unchanged sentences

(in thousands)

For the Six Months Ended June 30,

For the Nine Months Ended September 30,

Operating activities:

Net income (loss)

$ 17,673 $ 10,973

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

2 unchanged sentences

( 362 ) ( 121 )

Disposal of property and equipment

Changes in operating assets and liabilities:

Accounts receivable, net

( 1,192 ) ( 6,685 )

Inventory, net

71 unchanged sentences

The Company paid Takeda an upfront license fee of $ 7.0 million in October 2022, and Takeda is eligible to receive potential future milestone payments of up to $ 287.3 million upon the Company’s achievement of certain regulatory and commercial milestones over the course of the exclusive license agreement, as well as tiered royalty payments for any net sales of alisertib.

The Company recorded in-process research and development expense of $ 7.0 million during the year ended December 31, 2022, in connection with the upfront payment related to the asset acquisition.

As of June 30, 2025 , no milestones had been accrued as the underlying contingencies were not probable or estimable.

The Company has reported net income of approximately $ 8.8 million and cash provided by operations of approximately $ 17.7 million for the six months ended June 30, 2025 .

The Company’s commercialization, research and development or marketing efforts may require funding in addition to the cash and cash equivalents and marketable securities totaling approximately $ 96.0 million at June 30, 2025 .

The Company believes that its existing cash and cash equivalents and marketable securities as of June 30, 2025 and proceeds that will become available to the Company through product sales and sub-license payments are sufficient to satisfy its operating cash needs, including amounts due under the Company’s Note Purchase Agreement with Athyrium Opportunities IV Co-Invest 1 LP (“Athyrium”) (see Note 9—Debt ), for at least one year after the filing of the Quarterly Report on Form 10 -Q in which these financial statements are included.

The Company continues to remain dependent on its ability to obtain sufficient funding to sustain operations and continue to successfully commercialize neratinib in the United States.

As of September 30, 2025 , no milestones had been accrued as the underlying contingencies were not probable or estimable.

The Company has reported net income of approximately $ 17.7 million and cash provided by operations of approximately $ 27.4 million for the nine months ended September 30, 2025 .

The Company believes that its existing cash and cash equivalents and marketable securities as of September 30, 2025 and proceeds that will become available to the Company through product sales and sub-license payments are sufficient to satisfy its operating cash needs, including amounts due under the Company’s Note Purchase Agreement with Athyrium Opportunities IV Co-Invest 1 LP (“Athyrium”) (see Note 9—Debt ), for at least one year after the filing of the Quarterly Report on Form 10 -Q in which these financial statements are included.

The Company continues to remain dependent, in part, on its ability to obtain sufficient funding to sustain operations and continue to successfully commercialize neratinib in the United States.

While the Company has been successful in raising capital in the past, there can be no assurance that it will be able to do so in the future.

2 unchanged sentences

Additionally, the terms of the Company’s Note Purchase Agreement place restrictions on the Company’s ability to operate the business and on the Company’s financial flexibility, and the Company may be unable to achieve the revenue necessary to satisfy the minimum revenue and cash balance covenants as specified in the agreement.

Since its inception through June 30, 2025 , the Company’s financing has primarily consisted of proceeds from product, royalty and license revenue, public offerings of its common stock, private equity placements, and various debt instruments.

In the opinion of management, the included disclosures are adequate, and the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary for a fair statement of our consolidated financial position as of June 30, 2025 .

Since its inception through September 30, 2025 , the Company’s financing has primarily consisted of proceeds from product, royalty and license revenue, public offerings of its common stock, private equity placements, and various debt instruments.

Such adjustments are of a normal and recurring nature.

The condensed consolidated balance sheet as of December 31, 2024 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the audited annual financial statements.

The condensed consolidated results of operations for the quarter ended June 30, 2025 are not necessarily indicative of the consolidated results of operations that may be expected for the fiscal year ending December 31, 2025 .

The condensed consolidated results of operations for the quarter ended September 30, 2025 are not necessarily indicative of the consolidated results of operations that may be expected for the fiscal year ending December 31, 2025 .

The Company does not believe that tariffs imposed or proposed to be imposed by the United States, particularly with the EU and China, will have a material impact on our product costs or results of operations.

13 unchanged sentences

The CODM primarily uses our Consolidated Statement of Operations and related revenues, expenses and net income (loss) in evaluating the performance of the single operating segment and determining how to allocate resources of the Company as a whole, including our sales force and related marketing, research and development programs, including alisertib, and licensing strategy.

Consolidated revenue, expenses and net income (loss) are also used to monitor budget versus actual results.

In addition to the significant expense categories included within consolidated net income (loss) presented on the Company's Condensed Consolidated Statements of Operations, see below for disaggregated amounts that comprise operating expenses:

For the Three Months Ended June 30,

For the Six Months Ended June 30,

Consolidated revenue, expenses and net income are also used to monitor budget versus actual results.

In addition to the significant expense categories included within consolidated n et income presented on the Company's Condensed Consolidated Statements of Operations, see below for disaggregated amounts that comprise operating expenses:

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

Cost of sales

24 unchanged sentences

Other significant estimates include those related to the valuation of deferred income taxes, legal and other expense accruals.

Net In come (loss) per S hare of Common Stock:

Basic net income (loss) per share of common stock is computed by dividing net income (loss) available to common stockholders by the weighted-average number of shares of common stock outstanding during the periods presented, as required by Accounting Standards Codification (“ASC”), ASC 260, Earnings per Share .

For purposes of calculating diluted net income (loss) per share of common stock, the denominator includes both the weighted-average number of shares of common stock outstanding and the number of dilutive common stock equivalents, such as stock options, restricted stock units (“RSUs”) and warrants.

Net In come per S hare of Common Stock:

Basic net income per share of common stock is computed by dividing net income available to common stockholders by the weighted-average number of shares of common stock outstanding during the periods presented, as required by Accounting Standards Codification (“ASC”), ASC 260, Earnings per Share .

For purposes of calculating diluted net income per share of common stock, the denominator includes both the weighted-average number of shares of common stock outstanding and the number of dilutive common stock equivalents, such as stock options, restricted stock units (“RSUs”) and warrants.

A common stock equivalent is not included in the denominator when calculating diluted earnings per common share if the effect of such common stock equivalent would be anti-dilutive.

4 unchanged sentences

Diluted EPS excludes the impact of potential common shares related to our stock options in periods in which the option exercise price is greater than the average market price of our common stock for the period.

The following potentially dilutive outstanding common stock equivalents for the respective periods were excluded from diluted net income (loss) per share because of their anti-dilutive effect:

The following potentially dilutive outstanding common stock equivalents for the respective periods were excluded from diluted net income per share because of their anti-dilutive effect:

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

September 30,

Options outstanding

5 unchanged sentences

5,293,021 6,717,964 6,189,484 6,717,964

The 2,116,250 shares underlying the warrant will not have an impact on our diluted net income (loss) per share until the average market price of our common stock exceeds the exercise price of $ 16 per share (see Note 10—Stockholders’ Equity).

A reconciliation of the numerators and denominators of the basic and diluted net income (loss) per share of common stock computations is as follows (in thousands, except share and per share amounts):

For the Three Months Ended June 30,

For the Six Months Ended June 30,

Net income (loss)

The 2,116,250 shares underlying the warrant will not have an impact on our diluted net income per share until the average market price of our common stock exceeds the exercise price of $ 16 per share (see Note 10—Stockholders’ Equity).

A reconciliation of the numerators and denominators of the basic and diluted net income per share of common stock computations is as follows (in thousands, except share and per share amounts):

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

$ 8,844 $ 20,317 $ 17,673 $ 10,973

Weighted average common stock outstanding for basic net income (loss) per share

Weighted average common stock outstanding for basic net income per share

50,339,456 49,008,464 49,881,181 48,498,579

1 unchanged sentence

590,437 164,897 453,372 526,524

Weighted average common stock outstanding for diluted net income (loss) per share

Weighted average common stock outstanding for diluted net income per share

50,929,893 49,173,361 50,334,553 49,025,103

Net income (loss) per share of common stock

Net income per share of common stock

$ 0.18 $ 0.41 $ 0.35 $ 0.23

17 unchanged sentences

The Company expenses incremental costs of obtaining a contract when incurred if the expected amortization period of the asset that the Company would have recognized is one year or less.

However, no such costs were incurred during the six months ended June 30, 2025 and 2024 , respectively.

However, no such costs were incurred during the nine months ended September 30, 2025 and 2024 , respectively.

Reserves for Variable Consideration:

6 unchanged sentences

The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized under the contract will not occur in a future period.

The Company’s analyses also contemplated application of the constraint in accordance with the guidance, under which it determined a significant reversal of revenue would not likely occur in a future period for the estimates detailed below as of June 30, 2025 , and, therefore, the transaction price was not reduced further during the quarter ended June 30, 2025 .

The Company’s analyses also contemplated application of the constraint in accordance with the guidance, under which it determined a significant reversal of revenue would not likely occur in a future period for the estimates detailed below as of September 30, 2025 , and, therefore, the transaction price was not reduced further during the quarter ended September 30, 2025 .

Actual amounts of consideration ultimately received may differ from the Company’s estimates.

42 unchanged sentences

License fees under the sub-license agreements include one -time upfront payments when each sub-license agreement was executed and potential additional one -time milestone payments due to the Company upon successful completion of certain performance obligations, such as achieving regulatory approvals or sales target thresholds, and potential double-digit royalties on sales of the licensed product, calculated as a percentage of net sales of the licensed product throughout each sub-licensee’s respective territory.

As of June 30, 2025 , the total potential milestone payments that would be due to the Company upon achievement of all respective performance obligations under the sub-license agreements is approximately $ 579.8 million.

As of September 30, 2025 , the total potential milestone payments that would be due to the Company upon achievement of all respective performance obligations under the sub-license agreements is approximately $ 579.8 million.

A t this time, the Company cannot estimate if or when these milestone-related performance obligations might be achieved.

69 unchanged sentences

ASC 740 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures.

As of June 30, 2025 , the Company’s uncertain tax positions include a reserve for its research and development credits.

As of September 30, 2025 , the Company’s uncertain tax positions include a reserve for its research and development credits.

On July 4, 2025, the “One Big Beautiful Bill” was signed into law, which includes significant changes to federal tax law and other regulatory provisions that may impact the Company.

The Company is currently evaluating the provisions of the new law and the potential effects on its financial position, results of operations, and cash flows.

As of the date of these financial statements, the Company has not completed its assessment, and therefore no adjustments have been made.

Additional disclosures will be provided in future periods as the impact of the legislation is determined.

As of the date of these financial statements, the Company has evaluated the impact of the changes to Section 174 – Amortization of research and experimental expenditures on the valuation allowance release.

The Company intends to deduct the capitalized costs over two years.

This deduction reduces the amount of net operating losses being utilized but results in a net zero change to the deferred tax asset balance.

Therefore, the Company has concluded that it remains reasonable to maintain the $7.0 million estimate for the valuation allowance release as of September 30, 2025 as the facts and circumstances supporting the deferred tax asset have not materially changed.

Financial Instruments:

6 unchanged sentences

The lease-related letters of credit will lapse at the end of the respective lease terms through 2 026.

At each of the periods ending June 30, 2025 and December 31, 2024 , the Company had restricted cash in the amount of approximately $ 2.1 million.

At each of the periods ended September 30, 2025 and December 31, 2024 , the Company had restricted cash in the amount of approximately $ 2.1 million.

Investment Securities:

20 unchanged sentences

Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

Following are the major categories of assets measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024 , using quoted prices in active markets for identical assets (Level 1 ), significant other observable inputs (Level 2 ), and significant unobservable inputs (Level 3 ) (in thousands):

June 30, 2025

Following are the major categories of assets measured at fair value on a recurring basis as of September 30, 2025 and December 31, 2024 , using quoted prices in active markets for identical assets (Level 1 ), significant other observable inputs (Level 2 ), and significant unobservable inputs (Level 3 ) (in thousands):

September 30, 2025

Cash equivalents

19 unchanged sentences

The following tables summarize the Company’s cash equivalents and short-term investments (in thousands):

June 30, 2025

September 30, 2025

Cash equivalents

16 unchanged sentences

Financial instruments, which potentially subject the Company to concentrations of credit risk, principally consist of cash and cash equivalents, marketable securities, and accounts receivable, net.

The Company’s cash and cash equivalents and restricted cash in excess of the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation insured limits at June 30, 2025 were approximately $ 54.4 million.

The Company does not believe it is exposed to any significant credit risk due to the quality nature of the financial instruments in which the money is held.

24 unchanged sentences

Starter kits, provided to patients prior to insurance approval, are expensed by the Company to selling, general and administrative expense as incurred.

Of the total inventory amounts noted below, approximately $ 7.9 million is located at contract manufacturing organizations in Europe as of June 30, 2025 .

Of the total inventory amounts noted below, approximately $ 4.8 million is located at contract manufacturing organizations in Europe as of September 30, 2025 .

The Company’s inventory balances are as follows:

June 30, 2025

September 30, 2025

December 31, 2024

14 unchanged sentences

If the undiscounted cash flows used in the recoverability test are less than the carrying value, the Company would then determine the fair value of the long-lived asset and recognize an impairment loss for the amount in excess of the carrying value.

No impairments were recorded during the three months ended June 30, 2025 and 2024 .

No impairments were recorded during the three months ended September 30, 2025 and 2024 .

ASC Topic 842, Leases , as adopted in the first quarter of 2019, requires lessees to recognize most leases on the balance sheet with a corresponding right-of-use asset (“ROU asset”).

17 unchanged sentences

Covenants imposed by the leases include letters of credit required to be obtained by the lessee.

The Company is required to remeasure the lease liability and make an adjustment in the following instances:

• The term of the lease has been modified or there has been a change in the Company’s assessment of a purchase option being exercised, in which case the lease liability is remeasured by discounting the revised lease payments using a revised discount

• A lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case the lease liability is remeasured by discounting the revised lease payments using a revised discount rate;

• The lease payments are adjusted due to changes in the index or a change in expected payment under a guaranteed residual value, in which cases the lease liability is remeasured by discounting the revised lease payments using the initial discount rate.

The incremental borrowing rate (“IBR”) represents the rate of interest the Company would expect to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms.

As the implicit rate on the Company’s leases are not readily determinable, the Company uses its IBR based on the information available at the commencement date in determining the present value of lease payments.

The Company’s average IBR for existing leases as of June 30, 2025 is 10.9 %.

The Company’s average IBR for existing lea ses as of September 30, 2025 is 12.4 % .

License Fees and Intangible Assets:

28 unchanged sentences

Accounts receivable, net consisted of the following (in thousands):

June 30, 2025

September 30, 2025

December 31, 2024

5 unchanged sentences

Allowance for credit losses

( 213 ) ( 362 )

Total accounts receivable, net

1 unchanged sentence

Trade accounts receivable consist entirely of amounts owed from the Company’s customers related to product sales.

Royalty revenue receivable represents amounts owed related to royalty revenue recognized based on the Company’s sub-licensees’ sales in their respective territories in the periods ended June 30, 2025 and December 31, 2024 .

For all accounts receivable, the Company recognizes credit losses based on lifetime expected losses to selling, general and administrative expense in the condensed consolidated statements of operations.

In determining estimated credit losses, the Company evaluates its historical loss rates, current economic conditions and reasonable and supportable forecasts of future economic conditions .

The Company recorded a recovery to the provision for credit loss of $ 0.3 million and $ 0.2 million for the three months ended June 30, 2025 and 2024 , respectively.

The Company recorded a recovery to the provision of credit loss of $ 0.1 million for each of the six months ended June 30, 2025 and 2024 , respectively.

The Company recorded a recovery to the provision for credit loss of $ 0.1 million for each of the three months ended September 30, 2025 and 2024 .

The Company recorded a recovery to the provision for credit loss of $ 0.4 and $ 0.1 million for the nine months ended September 30, 2025 and 2024 , respectively.

Note 4 — Prepaid Expenses and Other:

Prepaid expenses and other consisted of the following (in thousands):

June 30, 2025

September 30, 2025

December 31, 2024

10 unchanged sentences

As amended, the Company rents approximately 65,656 square feet.

The term of the lease runs until March 2026 and rent amounts payable by the Company increase approximately 3 % per year.

Concurrent with the execution of the lease, the Company provided the landlord an automatically renewable stand-by letter of credit in the amount of $ 1.0 million.

The stand-by letter of credit is collateralized by a high-yield savings account, which is classified as restricted cash, current on the accompanying consolidated balance sheets.

In July 2025, we amended our existing lease agreement for our Los Angeles office to extend the lease term from April 1, 2026 to August 31 2031.

We have an option to extend the lease for an additional five -year period.

The total future lease payments under the amendment are approximately $ 6.6 million.

A letter of credit will not be required with the extended lease and the current letter of credit of $ 1.0 million will be returned to the Company.

The term of the lease runs until March 2026.

In July 2025, the Company executed an amendment to its office space in Los Angeles, California to surrender certain suites effective March 31, 2026 and extend the lease term for the remaining 26,700 rentable square feet for an additional five years and five months through August 31, 2031.

Base rent escalates annually and is abated from April 2026 through August 2026.

Lease payments also include variable charges for the Company’s proportionate share of building operating expenses and real estate taxes based on a 2026 base year.

The Company has the option to renew such lease for an additional five year term.

Management determined that the renewal option is not reasonably certain to occur.

The Company accounted for this amendment as a lease modification.

There was no change in the lease classification as a result of this modification and the Company continues to recognize such a lease as an operating lease.

The Company remeasured its ROU assets and operating lease liabilities using an updated incremental borrowing rate.

The change in ROU assets and operating lease liabilities related to this lease modification amounted to $ 4.1 million.

In June 2012, the Company entered into a long-term lease agreement for office space in South San Francisco, California, which was subsequently amended in May 2014 and July 2015.

3 unchanged sentences

The stand-by letter of credit is collateralized by a high-yield savings account, which is classified as restricted cash, current on the accompanying consolidated balance sheets.

Total rent expense for the three and six months ended June 30, 2025 was approximately $ 1.0 million and $ 2.2 million, respectively.

Total rent expense for the three and six months ended June 30, 2024 was approximately $ 1.2 million and $ 2.4 million, respectively.

Total rent expense for the three and nine months ended September 30, 2025 was approximately $ 1.1 million and $ 3.4 million, respectively.

Total rent expense for the three and nine months ended September 30, 2024 was approximately $ 1.2 million and $ 3.7 million, respectively.

For purposes of determining straight-line rent expense, the lease term is calculated from the date the Company first takes possession of the facility, including any periods of free rent and any renewal option periods that the Company is reasonably certain of exercising.

2 unchanged sentences

Such amounts are generally variable and therefore not included in the measurement of the ROU asset and related lease liability but are instead recognized as variable lease expense in selling, general and administrative costs in the condensed consolidated statements of operations when they are incurred.

Supplemental cash flow information related to leases for the six months ended June 30, 2025:

Supplemental cash flow information related to leases for the nine months ended September 30, 2025:

Operating cash flows used for operating leases (in thousands)

2 unchanged sentences

Weighted average discount rate

Future minimum lease payments as of June 30, 2025 were as follows (in thousands):

Future minimum lease payments as of September 30, 2025 were as follows (in thousands):

2025 (remaining)

Total minimum lease payments

5 unchanged sentences

As a result, the Company received $ 0.7 million, which approximated the sublease rental payments on the remaining lease term.

During the three months ending March 31, 2025, the Company signed another sublease agreement for the 12,429 square feet of the office space with a sublease commencement date of April 1, 2025.

During the three month period ended March 31, 2025, the Company signed another sublease agreement for the 12,429 square feet of office space with a sublease commencement date of April 1, 2025.

In August 2023, the Company entered into a long-term sublease agreement for 13,916 square feet of the office space in Los Angeles, California, which commenced in November 2023.

1 unchanged sentence

The Company has recorded sublease income in other income (expenses) in the condensed consolidated statements of operations since November 2023.

The Company recorded operatin g sublease income of $ 0.2 million for each of the three months ended June 30, 2025 and 2024 , and $ 0.5 million for each of the six months ended June 30, 2025 and 2024 , respectively, in other income (expenses) in the co ndensed consolidated statements of operations.

The f uture minimum lease payments to be received as of June 30, 2025 , were as follows (in thousands):

The Company recorded operatin g sublease income of $ 0.2 million for each of the three months ended September 30, 2025 and 2024 , and approximately $ 0.7 million for each of the nine months ended September 30, 2025 and 2024 , respectively, in other income (expenses) in the co ndensed consolidated statements of operations.

The f uture minimum lease payments to be received as of September 30, 2025 , were as follows (in thousands):

Note 6 — Property and Equipment, Net:

Property and equipment, net consisted of the following (in thousands):

June 30, 2025

September 30, 2025

December 31, 2024

8 unchanged sentences

Property and equipment, net

For the three and six months ended June 30, 2025 and 2024 , the Company incurred depreciation expense of $ 0.1 million and $ 0.2 million, respectively.

For the three and nine months ended September 30, 2025 and 2024 , the Company incurred depreciation expense of $ 0.1 million and $ 0.3 million, respectively.

Note 7 — Intangible Assets, Net:

Intangible assets, net consisted of the following (in thousands):

June 30, 2025

September 30, 2025

December 31, 2024

5 unchanged sentences

$ 43,827 $ 51,131

For each of the three and six months ended June 30, 2025 and 2024 , the Company incurred amortization expe nse of $ 2.4 million and $ 4.9 million, respectively.

The estimated remaining useful life of the intangible assets as of June 30, 2025 is 4.8 years.

For each of the three and nine months ended September 30, 2025 and 2024 , the Company incurred amortization expe nse of $ 2.4 million and $ 7.3 million, respectively.

The estimated remaining useful life of the intangible assets as of September 30, 2025 is 4.5 years.

Company reached a commercial milestone by achieving aggregate worldwide net sales of $ 250.0 million in calendar year 2022, resulting in a payment to Pfizer of $ 12.5 million during the three months ended March 31, 2023.

The Company capitalized the milestones as intangible assets and is amortizing the assets to cost of sales on a straight-line basis over the estimated useful life of the licensed patent through 2030.

The Company recorded amortization expense related to its intangible assets of approximately $ 2.4 million and $ 4.9 million for the three and six months ended June 30, 2025 and 2024 , respectively.

As of June 30, 2025 , estimated future amortization expense related to the Company’s intangible assets is approximately $ 4.9 million for the remainder of 2025 and $ 9.7 million for each year starting 2026 through 2029, and $ 2.4 million for 2030.

The Company recorded amortization expense related to its intangible assets of approximately $ 2.4 million and $ 7.3 million for the three and nine months ended September 30, 2025 and 2024 , respectively.

As of September 30, 2025 , estimated future amortization expense related to the Company’s intangible assets is approximately $ 2.4 million for the remainder of 2025 and $ 9.7 million for each year starting 2026 through 2029, and $ 2.4 million for 2030.

Note 8 — Accrued Expenses:

Accrued expenses consisted of the following (in thousands):

June 30, 2025

September 30, 2025

December 31, 2024

3 unchanged sentences

Accrued variable consideration

11,301 10,829

Accrued bonus

13 unchanged sentences

Long term debt consisted of the following (in thousands):

June 30, 2025

September 30, 2025

Maturity Date

19 unchanged sentences

Each quarterly principal payment approximates $ 11.1 million, and each quarterly exit fee payment approximates $ 0.2 million.

As of June 30, 2025, the effective interest rate for the loan was 12.99 %.

As of June 30, 2025, the Company may prepay the outstanding principal balance of the notes, in whole or in part, without premium or penalty.

As of September 30, 2025, the effective interest rate for the loan was 12.99 %.

As of September 30, 2025, the Company may prepay the outstanding principal balance of the notes, in whole or in part, without premium or penalty.

The Athyrium Notes include affirmative and negative covenants applicable to the Company.

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The Company is also required to maintain minimum cash balances and achieve certain minimum product revenue targets, measured as of the last day of each fiscal quarter on a trailing year-to-date basis.

As of June 30, 2025 , the Company was in compliance with such covenants.

As of June 30, 2025 , the principal balance outstanding under the Athyrium Notes was $ 44.5 million and exit fees were $ 0.9 million, representing all of the Company’s debt.

The future minimum principal and exit payments under the Athyrium Notes as of June 30, 2025 are as follows (in thousands):

As of September 30, 2025 , the Company was in compliance with such covenants.

As of September 30, 2025 , the principal balance outstanding under the Athyrium Notes was $ 33.3 million and exit fees were $ 0.7 million, representing all of the Company’s debt.

The future minimum principal and exit payments under the Athyrium Notes as of September 30, 2025 are as follows (in thousands):

Debt Issuance Costs and Discounts:

Debt issuance costs and discounts consist of the following (in thousands):

June 30, 2025

September 30, 2025

December 31, 2024

3 unchanged sentences

( 5,119 ) ( 4,454 )

Included in long-term debt

Included in current portion of debt

Debt issuance costs and discounts are financing costs related to the Company’s outstanding debt.

Amortization of debt issuance costs is expensed using the effective interest method and is included in interest expense in the condensed consolidated statement of operations.

For the three and six months ended June 30, 2025 , the Company recorded approxi mately $0.1 million and $ 0.3 million of interest expense, respectively.

For the three and six months ended June 30, 2024 , the Company recorded approximately $ 0.2 million and $ 0.5 million of interest expense, respectively.

For the three and nine months ended September 30, 2025 , the Company recorded approxi mately $ 0.1 million and $ 0.5 million of interest expense, respectively.

For the three and nine months ended September 30, 2024 , the Company recorded approximately $ 0.2 million and $ 0.7 million of interest expense, respectively.

Note 10 — Stockholders ’ Equity:

Common Stock:

The Company issued 55,882 and 0 shares of common stock upon exercise of stock options during the six months ended June 30, 2025 and 2024 , respectively.

The Company issued 731,009 and 813,333 shares of common stock upon vesting of RSUs during the six months ended June 30, 2025 and 2024 , respectively.

The Company issued 55,882 and 64,118 shares of common stock upon exercise of stock options during the nine months ended September 30, 2025 and 2024 , respectively.

The Company issued 1,222,558 and 1,356,443 shares of common stock upon vesting of RSUs during the nine months ended September 30, 2025 and 2024 , respectively.

Authorized Shares:

15 unchanged sentences

On June 18, 2024, the stockholders of the Company approved an amendment to the Company ’ s 2011 Plan, increasing the number of authorized shares of the Company’s common stock, par value $ 0.0001 per share, that may become issuable under the 2011 Plan by 3,000,000 shares and extending the period during which incentive stock options may be granted.

As of June 30, 2025 a total of 17,529,412 shares of the Company’s common stock have been reserved for issuance under the 2011 Plan.

As of September 30, 2025 a total of 17,529,412 shares of the Company’s common stock have been reserved for issuance under the 2011 Plan.

All of the options awarded by the Company have been “plain vanilla options” as determined by the SEC Staff Accounting Bulletin 107 - Share Based Payment.

As of June 30, 2025 , 5,326,457 shares of the Company’s common stock are issuable upon the exercise of outstanding stock options and vesting of RSUs granted under the 2011 Plan and 2,975,277 shares of the Company’s common stock are available for future issuance under the 2011 Plan.

The fair value of options granted to employees and nonemployees was estimated using the Black-Scholes Option Pricing Method (see Note 2—Significant Accounting Policies) with the following weighted-average assumptions used during the six months ended June 30, 2025 :

As of September 30, 2025 , 4,518,398 shares of the Company’s common stock are issuable upon the exercise of outstanding stock options and vesting of RSUs granted under the 2011 Plan and 3,310,878 shares of the Company’s common stock are available for future issuance under the 2011 Plan.

Dividend yield

8 unchanged sentences

On July 15, 2021, the Board of Directors adopted an amendment to the 2017 Plan to increase the number of shares of the Company ’ s common stock reserved for issuance thereunder by 1,000,000 share s.

As of June 30, 2025 a total of 3,000,000 shares of the Company’s common stock have been reserved for issuance under the 2017 Plan.

As of June 30, 2025 , a total of 672,266 shares of the Company’s common stock are issuable upon the exercise of outstanding stock options and vesting of RSUs granted under the 2017 Plan and 1,069,130 shares of the Company’s common stock are available for future issuance under the 2017 Plan.

As of September 30, 2025 a total of 3,000,000 shares of the Company’s common stock have been reserved for issuance under the 2017 Plan.

As of September 30, 2025 , a total of 393,800 shares of the Company’s common stock are issuable upon the exercise of outstanding stock options and vesting of RSUs granted under the 2017 Plan and 1,328,505 shares of the Company’s common stock are available for future issuance under the 2017 Plan.

Stock-based compensation expense was as follows (in thousands):

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

September 30,

Stock-based compensation:

20 unchanged sentences

( 850,176 ) 60.00

Outstanding at June 30, 2025

Outstanding at September 30, 2025

3,553,430 $ 21.73 5.1 $ 2,774

Vested and expected to vest at June 30, 2025

Vested and expected to vest at September 30, 2025

3,553,430 $ 21.73 5.1 $ 2,774

3,147,703 $ 24.07 4.6 $ 1,964

At June 30, 2025 , total estimated unrecognized employee compensation cost related to non-vested stock options granted prior to that date was approximately $ 1.0 million , which is expected to be recognized over a weighted-average period o f 1.2 years .

At June 30, 2025 , the total estimated unrecognized employee compensation cost related to non-vested RSUs was approximately $ 5.0 million , which is expected to be recognized over a weighted-average period of 1.3 years .

The weighted-average grant date fair value of options granted during the six months ended June 30, 2025 and 2024 was $ 1.95 and $ 4.57 per share, respectively.

The weighted average grant date fair value of RSUs awarded during the six months ended June 30, 2025 and 2024 was $ 3.31 and $ 5.90 per share, respecti vely.

At September 30, 2025 , total estimated unrecognized employee compensation cost related to non-vested stock options granted prior to that date was approximately $ 0.7 million , which is expected to be recognized over a weighted-average period o f 1.1 years .

At September 30, 2025 , the total estimated unrecognized employee compensation cost related to non-vested RSUs was approximately $ 3.8 million , which is expected to be recognized over a weighted-average period of 1.3 years .

The weighted-average grant date fair value of options granted during the nine months ended September 30, 2025 and 2024 was $ 1.95 and $ 4.57 per share, respectively.

The weighted average grant date fair value of RSUs awarded during the nine months ended September 30, 2025 and 2024 was $ 3.34 and $ 5.89 per share, respecti vely.

Restricted Stock Unit Roll Forward:

5 unchanged sentences

( 1,222,558 ) $ 4.60

Nonvested shares at June 30, 2025

Nonvested shares at September 30, 2025

1,358,768 $ 3.86

2 unchanged sentences

The Company is required to make matching contributions to the 401 (k) plan equal to 100 % of the fi rst 3% of wages deferred by each participating employee and 50 % on the next 2% of wages deferred by each participating employee.

The Company incurred expenses for employer matching contributions of approximately $ 1.0 million and $ 0.9 million for the six months ended June 30, 2025 and 2024 , respectively.

The Company incurred expenses for employer matching contributions of approximately $ 1.4 million and $ 1.4 million for the nine months ended September 30, 2025 and 2024 , respectively.

Note 12 — Commitments and Contingencies:

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Takeda received an upfront license fee of $ 7.0 million in October 2022 and is eligible to receive potential future milestone payments of up to $ 287.3 million upon the Company’s achievement of certain regulatory and commercial milestones over the course of the exclusive license agreement, as well as tiered royalty payments for any net sales of alisertib.

No milestones were achieved as of June 30, 2025.

No milestones were achieved as of September 30, 2025.

Legal Proceedings:

The Company and certain of its executive officers were named as defendants in the lawsuits detailed below.

The Company records a liability in the consolidated financial statements for loss contingencies when a loss is known or considered probable and the amount can be reasonably estimated.

24 unchanged sentences

The Company appealed this ruling to the North Carolina Court of Appeals.

The Court of Appeals heard the appeal on April 3, 2025, but has not yet issued a ruling.

On September 3, 2025, the Court of Appeals reversed the dismissal of the Company’s claim for legal malpractice and remanded the case to the Superior Court for further proceedings.

The defendants filed a petition for discretionary review of this decision by the North Carolina Supreme Court on October 8, 2025.

The Supreme Court has not decided whether to accept the case for review.

Patent-Related Proceedings

134 unchanged sentences

On September 25, 2023, the CNIPA accepted the Company’s withdrawal request.

On September 9, 2025, the NMPA approved Kelun’s ANDA to market a generic version of the Company’s NERLYNX® in China with the approval number of GuoYaoZhunZi H20255337.

Demai Litigation

48 unchanged sentences

Outside the United States, we seek to enter into exclusive sub-license agreements with third parties to pursue regulatory approval, if necessary, and commercialize NERLYNX, if approved.

As of June 30, 2025, NERLYNX has received approval for the treatment of certain patients with extended adjuvant or metastatic HER2-positive breast cancer in over 40 countries outside the United States.

As of September 30, 2025, NERLYNX has received approval for the treatment of certain patients with extended adjuvant or metastatic HER2-positive breast cancer in over 40 countries outside the United States.

We are currently party to several sub-licenses in various regions outside the United States, including Europe, Australia, Canada, China, Southeast Asia, Israel, South Korea, Russia and various countries and territories in Central America, South America, Africa and the Middle East.

7 unchanged sentences

We recorded in-process research and development expense of $7.0 million during the year ended December 31, 2022, in connection with the upfront payment related to the asset acquisition.

As of June 30, 2025, no milestones had been accrued as the underlying contingencies were not probable or estimable.

As of September 30, 2025, no milestones had been accrued as the underlying contingencies were not probable or estimable.

Our expenses to date have been related to hiring staff, commencing company-sponsored clinical trials, building out of our corporate infrastructure and, since 2017, the commercial launch of NERLYNX.

2 unchanged sentences

To date, our major sources of working capital have been proceeds from product and license revenue, public offerings of our common stock, proceeds from our credit facility and sales of our common stock in private placements.

We intend to satisfy our near-term liquidity requirements through a combination of our existing cash and cash equivalents and marketable securities as of June 30, 2025, and proceeds that will become available to us through product sales, royalties and sub-license milestone payments.

We intend to satisfy our near-term liquidity requirements through a combination of our existing cash and cash equivalents and marketable securities as of September 30, 2025, and proceeds that will become available to us through product sales, royalties and sub-license milestone payments.

However, this intention is based on assumptions that may prove to be wrong.

2 unchanged sentences

Critical Accounting Policies

As of the date of the filing of this Quarterly Report, we believe there have been no material changes to our critical accounting policies and estimates during the six months ended June 30, 2025 from our accounting policies at December 31, 2024, as reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

As of the date of the filing of this Quarterly Report, we believe there have been no material changes to our critical accounting policies and estimates during the nine months ended September 30, 2025 from our accounting policies at December 31, 2024, as reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Summary of Income and Expenses

18 unchanged sentences

Research and development expenses (“R&D expenses”) include costs associated with services provided by consultants who conduct and perform clinical services on our behalf and contract organizations for the manufacturing of clinical materials.

During the three and six months ended June 30, 2025 and 2024, our R&D expenses consisted primarily of clinical research organization (“CRO fees”);

During the three and nine months ended September 30, 2025 and 2024, our R&D expenses consisted primarily of clinical research organization (“CRO fees”);

fees paid to consultants;

6 unchanged sentences

The ultimate impact of any announced or future tariffs will depend on various factors, including what tariffs are ultimately implemented, the timing of implementation and the amount, scope and nature of such tariffs and potential exclusions from the application of those tariffs.

On July 4, 2025, the One Big Beautiful Bill Act was signed into law, which includes significant changes to federal tax law and other regulatory provisions that may impact us.

We are currently evaluating the provisions of the new law and the potential effects on our financial position, results of operations, and cash flows.

As of the date of these financial statements, we have not completed our assessment, and therefore no adjustments have been made.

Additional disclosures will be provided in future periods as the impact of the legislation is determined.

On July 4, 2025, the “One Big Beautiful Bill” was signed into law, which includes significant changes to federal tax law and other regulatory provisions that may impact us.

As of the date of these financial statements, we have evaluated the impact of the changes to Section 174 – Amortization of research and experimental expenditures on the valuation allowance release.

We intend to deduct the capitalized costs over two years.

This deduction reduces the amount of net operating losses being utilized but results in a net zero change to the deferred tax asset balance.

Therefore, we have concluded that it remains reasonable to maintain the $7.0 million estimate for the valuation allowance release as of September 30, 2025 as the facts and circumstances supporting the deferred tax asset have not materially changed.

Results of Operations

Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

Total revenue:

Total revenue for the three months ended June 30, 2025 was approximately $52.4 million, compared to $47.1 million for the three months ended June 30, 2024.

This increase in total revenue was due to an increase in product revenue, net of approximately $4.8 million and an increase in royalty revenue of $0.6 million.

Total revenue for the three months ended September 30, 2025 was approximately $54.5 million, compared to $80.5 million for the three months ended September 30, 2024.

This decrease in total revenue was due to a decrease in product revenue, net of approximately $4.2 million and a decrease in royalty revenue of $21.8 million.

Product revenue, net:

Product revenue, net was approximately $49.2 million for the three months ended June 30, 2025, compared to $44.4 million for the three months ended June 30, 2024.

This increase in product revenue, net, compared to the three months ended June 30, 2024, was attributable to a 4% increase in b ottles of NERLYNX sold in the U.S.

market and an increase in net selling price, partially offset by a slight increa se in deductions to gross revenue for variable consideration, primarily related to government chargebacks.

Product revenue, net was approximately $51.9 million for the three months ended September 30, 2025, compared to $56.1 million for the three months ended September 30, 2024.

This decrease in product revenue, net, compared to the three months ended September 30, 2024, was attributable to a decrease in product supply revenue to our international licensees (reduction in China sales), partially offset by an increase in domestic sales resulting from an 8% increase in b ottles of NERLYNX sold in the U.S.

market and an increase in net selling price.

This increase in gross domestic sales was partially offset by greater deductions to gross revenue for variable consideration, primarily related to government chargebacks.

Royalty revenue:

Royalty revenue was approximately $3.2 million for the three months ended June 30, 2025 , compared to approximately $2.7 million for the three months ended June 30, 2024.

The increase was primarily due to increased international sales made by our sub-licensees.

Royalty revenue was approximately $2.6 million for the three months ended September 30, 2025 , compared to approximately $24.4 million for the three months ended September 30, 2024.

The decrease was primarily due to timing of sales made into China by our sub-licensee.

Cost of sales:

Cost of sales was approximately $12.3 million for the three months ended June 30, 2025 , compared to approximately $10.7 million for the three months ended June 30, 2024.

The increase was primarily due to higher royalty expense and product costs resulting from increased worldwide net sales.

Cost of sales was approximately $12.2 million for the three months ended September 30, 2025 , compared to approximately $29.1 million for the three months ended September 30, 2024.

The decrease was primarily due to timing of sales made into China by our sub-licensee and the related cost of products shipped and royalty expense.

Selling, general and administrative expenses:

SG&A expenses were approximately $18.0 million for the three months ended June 30, 2025, compared to approximately $25.0 million for the three months ended June 30, 2024.

SG&A expenses for the three months ended June 30, 2025 and 2024 were as follows:

SG&A expenses were approximately $16.8 million for the three months ended September 30, 2025, compared to approximately $16.8 million for the three months ended September 30, 2024.

SG&A expenses for the three months ended September 30, 2025 and 2024 were as follows:

Selling, general, and administrative expenses

1 unchanged sentence

(in thousands)

September 30,

Payroll and related costs

4 unchanged sentences

Stock-based compensation

SG& A expenses decreased by approximately $6.9 million for the three months ended June 30, 2025 , compared to the same period in 2024 , primarily attributable to the following:

a decrease in provision for credit loss of approximately $0.2 million primarily related to the payment history of a customer receivable;

a decrease in professional fees and expenses of approximately $7.4 million primarily related to legal fees associated with the AstraZeneca litigation in the prior year;

a decrease in travel and meetings of approximately $0.2 million primarily related to the cost of sales meetings;

SG& A expenses remained virtually unchanged for the three months ended September 30, 2025 , compared to the same period in 2024 , primarily attributable to the following:

an increase in credit loss recovery of approximately $0.2 million, primarily related to the payment history of a customer receivable;

a decrease in professional fees and expenses of approximately $0.3 million, pri marily related to legal fees associated with the AstraZeneca litigation in the prior year;

a decrease in stock-based compensation expense of approximately $0.4 million, primarily due to newer awards at a lower grant price.

Partially offset by:

an increase in payroll and related costs of approximately $1.5 million primarily due to the severance costs related to the departure of our Chief Commercial Officer , increased headcount in our sales team as well as an increase in our healthcare insurance premiums.

an increase in payroll and related costs of approximately $0.8 million, primarily due to an increase in bonus related payroll costs as well as increases in our healthcare insurance premiums.

Research and development expenses:

R&D expenses were approxi mately $15.5 million for the three months ended June 30, 2025, compared to approximately $13.6 million for the three months ended June 30, 2024.

R&D expenses for the three months ended June 30, 2025 and 2024, were as follows:

R&D expenses were approxi mately $15.9 million for the three months ended September 30, 2025, compared to approximately $12.6 million for the three months ended September 30, 2024.

R&D expenses for the three months ended September 30, 2025 and 2024, were as follows:

Research and development expenses

1 unchanged sentence

(in thousands)

September 30,

Clinical trial expense

1 unchanged sentence

Stock-based compensation

R&D exp enses increased by a pproxim ately $1.8 million for the three m onths ended June 30, 2025, compared to the same period in 2024, primarily attributable to the following:

R&D exp enses increased by a pproxim ately $3.4 million for the three m onths ended September 30, 2025, compared to the same period in 2024, primarily attributable to the following:

an increase in clinical trial expense of approximately $1.8 million, primarily due to increased alisertib study activity;

an increase in consultants and contractors expense of approximately $0.4 million, primarily due to increased alisertib stud y activity.

an increase in internal R&D expense of approximatel y $0.9 million, primarily due to increased payroll and healthcare costs;

an increase in consultants and contractors expense of approximately $0.6 million, primarily due to increased alisertib study activity.

Other income (expenses):

2 unchanged sentences

(in thousands)

September 30,

Interest income

1 unchanged sentence

Interest income:

For the three months ended June 30, 2025 , we recognized approximately $1.0 million in interest income, compared to approximately $1.2 million of interest income for the three m onths ended June 30, 2024 .

The decreas e in interest income was primarily the result of lower investment balances and timing of investments.

For the three months ended September 30, 2025 , we recognized approximately $1.0 million in interest income, compared to approximately $1.3 million of interest income for the three m onths ended September 30, 2024 .

The decreas e in interest incom e was primarily the result of lower investment balances and timing of investments.

Interest expense:

For the three months ended

June 30, 2025

September 30, 2025

, we recognized approximately $1.5 million in interest expense, compared to approximately $3.1 million of interest expense for the three m onths ended

June 30, 2024

The decrease in interest expense was primarily related to a lower debt balance as we began paying down our debt principal during the three months ended June 30, 2024.

September 30, 2024

The decrease in interest expense was primarily related to a lower debt balance as we began paying down our debt principal during the three months ended September 30, 2024.

Other income:

For the three months ended

June 30, 2025

September 30, 2025

, we recognized approximately $0.1 million in other income, compared to approximately $0.3 million of other income for the three m onths ended

June 30, 2024

The increase in other income was primarily due

to favorable exchange rates in Euro-denominated transactions.

Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

September 30, 2024

The decrease in other income was

primarily due to unfavorable exchange rates in Euro-denominated transactions.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Total revenue:

Total revenue for the six months ended June 30, 2025 was approximately $98.4 million, compared to $90.8 million for the six months ended June 30, 2024.

This increase in total revenue was due to an increase in product revenue, net of approximately $7.6 million.

Total revenue for the nine months ended September 30, 2025 was approximately $152.9 million, compared to $171.4 million for the nine months ended September 30, 2024.

This $18.5 million decrease in total revenue was due to a decrease in royalty revenue of $21.9 million, partially offset by an increase in product revenue, net of approximately $3.4 million.

Product revenue, net:

Product revenue, net was app roximately $92.3 millio n for the six months ended June 30, 2025, compared t o $84.7 million for the six months ended June 30, 2024.

This increase in product revenue, net, compared to the six months ended June 30, 2024, was attributable to an increase in net selling price, partially offset by a decrease of approximately 1.0% in deductions to gross r evenue for variable consideration, primarily related fewer Medicaid charges.

Product revenue, net was app roximately $144.2 millio n for the nine months ended September 30, 2025, compared t o $140.8 million for the nine months ended September 30, 2024.

This increase in product revenue, net, compared to the nine months ended September 30, 2024, was attributable to an increase in domestic sales resulting from a 3% increase in b ottles of NERLYNX sold in the U.S.

market and an increase in net selling price, partially offset by an increase in deductions to gross r evenue for variable consideration, primarily related to government chargebacks.

Royalty revenue:

Royalty revenue was approximately $6.2 million for each of the six months ended June 30, 2025 and June 30, 2024.

Royalty revenue was approximately $8.7 million and $30.6 million for the nine months ended September 30, 2025 and September 30, 2024 respectively.

The decrease in royalty revenue was primarily due to a decrease in sales to our international licensees (reduction in China sales).

Cost of sales:

Cost of sales was approximately $22.9 million for the six months ended June 30, 2025 , compared to approximately $21.4 million for the six months ended June 30, 2024 .

The increase was primarily due to higher royalty expense and product costs resulting from increased global sales.

Cost of sales was approximately $35.0 million for the nine months ended September 30, 2025 , compared to approximately $50.5 million for the nine months ended September 30, 2024 .

The decrease was primarily due to timing of sales made into China by our sub-licensee and the related cost of products shipped and royalty expense.

Selling, general and administrative expenses:

SG&A expenses were approximately $35.7 million for the six months ended June 30, 2025, compared to approximately $46.7 million for the six months ended June 30, 2024.

SG&A expenses for the six months ended June 30, 2025 and 2024 were as follows:

SG&A expenses were approximately $52.5 million for the nine months ended September 30, 2025, compared to approximately $63.5 million for the nine months ended September 30, 2024.

SG&A expenses for the nine months ended September 30, 2025 and 2024 were as follows:

Selling, general, and administrative expenses

For the Six Months Ended

For the Nine Months Ended

(in thousands)

September 30,

Payroll and related costs

4 unchanged sentences

Stock-based compensation

SG& A expenses decreased by approximately $11.1 million for the six months ended June 30, 2025 , compared to the same period in 2024 , primarily attributable to the following:

a decrease in professional fees and expenses of approximately $11.0 million primarily related to legal fees associated with the AstraZeneca litigation in the prior year as well as some decrease in our insurance costs;

SG& A expenses decreased by approximately $11.1 million for the nine months ended September 30, 2025 , compared to the same period in 2024 , primarily attributable to the following:

an increase in provision for credit loss of approximately $0.2 million, primarily related to the payment history of a customer receivable;

a decrease in professional fees and expenses of approximately $11.3 million, primarily related to legal fees associated with the AstraZeneca litigation in the prior year;

a decrease in stock-based compensation expense of approximately $1.1 million, primarily due to newer awards at a lower grant price.

2 unchanged sentences

Research and development expenses:

R&D expenses were approxi mately $29.3 million for the six months ended June 30, 2025, compared to approximately $27.2 million for the six months ended June 30, 2024.

R&D expenses for the six months ended June 30, 2025 and 2024, were as follows:

R&D expenses were approxi mately $45.2 million for the nine months ended September 30, 2025, compared to approximately $39.8 million for the nine months ended September 30, 2024.

R&D expenses for the nine months ended September 30, 2025 and 2024, were as follows:

Research and development expenses

For the Six Months Ended

For the Nine Months Ended

(in thousands)

September 30,

Clinical trial expense

1 unchanged sentence

Stock-based compensation

R&D exp enses increased by a pproxim ately $2.1 million compared to the six m onths ended June 30, 2025, compared to the same period in 2024, primarily attributable to the follow:

R&D exp enses increased by a pproxim ately $5.5 million compared to the nine m onths ended September 30, 2024, primarily attributable to the following:

an increase in clinical trial expense of approximately $3.4 million, primarily due to increased alisertib study activity;

2 unchanged sentences

Other income (expenses)

For the Six Months Ended

For the Nine Months Ended

(in thousands)

September 30,

Interest income

1 unchanged sentence

Interest income:

For the six months ended June 30, 2025 , we recognized approximately $2.1 million in interest income, compared to approximately $2.2 million of interest income for the six m onths ended June 30, 2024 .

The decreas e in interest income was primarily the result of lower investment balances and timing of investments.

For the nine months ended September 30, 2025 , we recognized approximately $3.1 million in interest income, compared to approximately $3.5 million of interest income for the nine m onths ended September 30, 2024 .

The decreas e in interest income was prima rily the result of lower investment balances and timing of investments.

Interest expense:

June 30, 2025

September 30, 2025

, we recognized approximately $5.5 million in interest expense, compared to approximately $9.8 million of interest expense for the

m onths ended

June 30, 2024

September 30, 2024

The decrease in interest expense was primarily related to a lower debt balance as we began paying down our debt principal during the

months ended June 30, 2024.

months ended September 30, 2024.

Other income:

June 30, 2025

September 30, 2025

, we recognized approximately $0.9 million in other income, compared to approximately $0.6 million of other income for the

m onths ended

June 30, 2024

The increase in other income was primarily due

to favorable exchange rates in Euro-denominated transactions.

September 30, 2024

The increase in other income was

primarily due to favorable exchange rates in Euro-denominated transactions.

Liquidity and Capital Resources

The following table, which summarizes our liquidity and capital resources as of June 30, 2025 and December 31, 2024 and for the six months ended June 30, 2025 and 2024, is intended to supplement the more detailed discussion that follows:

The following table, which summarizes our liquidity and capital resources as of September 30, 2025 and December 31, 2024 and for the nine months ended September 30, 2025 and 2024, is intended to supplement the more detailed discussion that follows:

Liquidity and capital resources (in thousands)

June 30, 2025

September 30, 2025

December 31, 2024

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Stockholders’ equity

Six Months Ended

June 30, 2025

June 30, 2024

Nine Months Ended

September 30, 2025

September 30, 2024

Cash provided by (used in):

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Operating Activities:

Cash provided by operating activities for the six months ended June 30, 2025 was $17.7 million and consisted of net income of approximately $8.8 million, adjusted for non-cash items of approximately $9.1 million, which included stock-based compensation of $3.7 million, depreciation and amortization of $5.6 million and provision for credit loss recovery of $0.1 million.

Total changes in cash flows from operations were due to a slight decrease in working capital, primarily related to a decrease in accrued expenses and other of approximately $5.0 million, a decrease in operating lease assets and liabilities, net, of $0.9 million and a decrease of post-marketing commitment liability of $1.1 million, partially offset by a decrease in prepaid and other expenses of $0.5 million, a decrease in accounts receivable of approximately $6.3 million and a decrease in inventory of $0.1 million.

Cash provided by operating activities for the six months ended June 30, 2024 was $12.3 million and consisted of a net loss of approximately $9.3 million, adjusted for non-cash items of approximately $10.2 million, including stock-based compensation of $4.4 million, depreciation and amortization of $5.8 million and provision for credit loss recovery of $0.1 million.

Total changes in cash flows from operations were due to an increase in working capital, primarily related to a decrease in accounts receivable of approximately $19.8 million, a decrease in prepaid expenses and other of $1.4 million and an increase in accounts payable of approximately $6.6 million, partially offset by a decrease in accrued expenses and other of approximately $13.7 million and an increase in inventory of approximately $2.0 million.

Cash provided by operating activities for the nine months ended September 30, 2025 was $27.4 million and consisted of net income of approximately $17.7 million, adjusted for non-cash items of approximately $13.2 million, which included stock-based compensation of $5.3 million, depreciation and amortization of $8.3 million and provision for credit loss recovery of $0.4 million.

Total changes in cash flows from operations were due to an increase in working capital, primarily related to an increase in accounts receivable of $1.2 million, an increase in inventory of $0.8 million, a decrease of post-marketing commitment liability of $1.7 million, a decrease in operating lease assets and liabilities, net, of $1.3 million and an increase in accrued expenses and other of approximately $0.3 million, partially offset by a decrease in prepaid and other expenses of $0.4 million and an increase in accounts payable of $0.9 million.

Cash provided by operating activities for the nine months ended September 30, 2024 was $23.3 million and consisted of net income of approximately $11.0 million, adjusted for non-cash items of approximately $15.1 million, including stock-based compensation of $6.5 million, depreciation and amortization of $8.7 million and provision for credit loss of $0.1 million.

Total changes in cash flows from operations were due to a decrease in working capital, primarily related to an increase in accounts receivable of approximately $6.7 million (primarily sales to China) and a decrease in accrued expenses and other of approximately $2.1 million, partially offset by a decrease in inventory of $4.4 million (primarily sales to China) and a decrease in prepaid expenses and other of $2.4 million.

Investing Activities:

Cash used in investing activities for the six months ended June 30, 2025 was approximately $9.7 million, compared to net cash used in investing activities of approximately $18.4 million for the same period in 2024 .

Cash used in investing activities for the six months ended June 30, 2025 was primarily due to the purchase of available-for-sale securities of approximately $34.4 million, partially offset by the maturity of available-for-sale securities of approximately $24.8 million.

Cash used in investing activities for the six months ended June 30, 2024 was approximately $18.4 million, compared to net cash used by investing activities of approximately $22.1 million for the same period in 2023.

Cash used in investing activities for the nine months ended September 30, 2025 was approximately $9.2 million, compared to net cash used in investing activities of approximately $18.1 million for the same period in 2024 .

Cash used in investing activities for the nine months ended September 30, 2025 was primarily due to the purchase of available-for-sale securities of approximately $61.2 million, partially offset by the maturity of available-for-sale securities of approximately $52.1 million.

Cash used in investing activities for the nine months ended September 30, 2024 was approximately $18.1 million, compared to net cash used in investing activities of approximately $11.0 million for the same period in 2023.

Cash used in investing activities was primarily due to the purchase of available-for-sale securities of approximately $61.0 million, offset by the maturity of available-for-sale securities of approximately $42.9 million.

Financing Activities:

Cash used in financing activities for the three months ended June 30, 2025 was approximately $22.5 million, including $22.2 million related to the payment of principal and $0.4 million related exit fees, on our debt with Athyrium, partially offset by $0.1 million in proceeds from shares issued under employee stock plans.

Cash used in financing activities for the three months ended June 30, 2024 was approximately $11.3 million, including $11.1 million related to the payment of principal and $0.2 million related exit fees, on our debt with Athyrium.

Cash used in financing activities for the nine months ended September 30, 2025 was approximately $33.9 million, including $33.3 million related to the payment of principal and $0.7 million related exit fees, on our debt with Athyrium, partially offset by $0.1 million in proceeds from shares issued under employee stock plans.

Cash used in financing activities for the nine months ended September 30, 2024 was approximately $22.5 million.

Of this amount, $22.7 million related to the payment of principal, as well as exit fees, on our debt with Athyrium, partially offset by approximately $0.2 million of proceeds from employee stock options exercised.

Athyrium Note Purchase Agreement:

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Each quarterly principal payment approximates $11.1 million, and each quarterly exit fee payment approximates $0.2 million.

As of June 30, 2025, the effective interest rate for the loan was 12.99%.

As of June 30, 2025, we may prepay the outstanding principal balance of the notes, in whole or in part, without premium or penalty.

As of September 30, 2025, the effective interest rate for the loan was 12.99%.

As of September 30, 2025, we may prepay the outstanding principal balance of the notes, in whole or in part, without premium or penalty.

The Athyrium Notes include affirmative and negative covenants applicable to us.

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We are also required to maintain minimum cash balances and achieve certain minimum product revenue targets, measured as of the last day of each fiscal quarter on a trailing year-to-date basis.

As of June 30, 2025, we were in compliance with such covenants.

As of June 30, 2025 , the principal balance outstanding under the Athyrium Notes was $44.5 million and represents all of our debt.

As of September 30, 2025, we were in compliance with such covenants.

As of September 30, 2025 , the principal balance outstanding under the Athyrium Notes was $33.3 million and represents all of our debt.

We are in compliance with all applicable covenants under the Athyrium Notes.

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For example, we in-licensed alisertib from Takeda in 2022 and assumed sole responsibility for its global development and commercialization.

These efforts will require funding in addition to the cash and cash equivalents totaling approximately $54.7 million and approximately $41.4 million in marketable securities available at June 30, 2025 .

These efforts will require funding in addition to the cash and cash equivalents totaling approximately $53.5 million and approximately $40.9 million in marketable securities available at September 30, 2025 .

While our consolidated financial statements have been prepared on a going concern basis, we may incur significant losses in the future and will need to generate significant revenue to sustain operations and successfully commercialize neratinib and develop alisertib.

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The outcome of these matters cannot be predicted at this time.

We believe that our existing cash and cash equivalents and marketable securities as of June 30, 2025, and proceeds that will become available to us through product sales and sub-license payments are sufficient to satisfy our operating cash and capital needs for at least one year after the filing of this Quarterly Report.

We believe that our existing cash and cash equivalents and marketable securities as of September 30, 2025, and proceeds that will become available to us through product sales and sub-license payments are sufficient to satisfy our operating cash and capital needs for at least one year after the filing of this Quarterly Report.

In addition, we have based our estimate of capital needs on assumptions that may prove to be wrong.

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In addition to our operating results, as calculated in accordance with Generally Accepted Accounting Principles (“GAAP”) we use certain non-GAAP financial measures when planning, monitoring, and evaluating our operational performance.

The following table presents our net income (loss) and net income (loss) per share, as calculated in accordance with GAAP, as adjusted to remove the impact of stock-based compensation.

For the three and six months ended June 30, 2025 , stock-based compensation represented approximately 4.9% and 5.6% of our operating expenses, respectively, compared to 5.3% and 6.0% for the same respective periods in 2024 , in each case excluding cost of s ales.

The following table presents our net income and net income per share, as calculated in accordance with GAAP, as adjusted to remove the impact of stock-based compensation.

For the three and nine months ended September 30, 2025 , stock-based compensation represented approximately 5.1% and 5.5% of our operating expenses, respectively, compared to 7.0% and 6.3% for the same respective periods in 2024 , in each case excluding cost of s ales.

Our management believes that these non-GAAP financial measures are useful to enhance understanding of our financial performance, are more indicative of our operational performance and facilitate a better comparison among fiscal periods.

These non-GAAP financial measures are not, and should not be viewed as, substitutes for GAAP reporting measures.

Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted Net Income (Loss) and

GAAP Net Income (Loss) Per Share to Non-GAAP Adjusted Net Income (Loss) Per Share

Reconciliation of GAAP Net Income to Non-GAAP Adjusted Net Income and

GAAP Net Income Per Share to Non-GAAP Adjusted Net Income Per Share

(in thousands except share and per share data)

For the Three Months Ended June 30,

For the Six Months Ended June 30,

GAAP net income (loss)

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

GAAP net income

Stock-based compensation -

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Research and development (2)

Non-GAAP adjusted net income (loss)

GAAP net income (loss) per share—basic

Adjustment to net income (loss) (as detailed above)

Non-GAAP adjusted basic net income (loss) per share

GAAP net income (loss) per share—diluted

Adjustment to net income (loss) (as detailed above)

Non-GAAP adjusted diluted net income (loss) per share

Non-GAAP adjusted net income

GAAP net income per share—basic

Adjustment to net income (as detailed above)

Non-GAAP adjusted basic net income per share

GAAP net income per share—diluted

Adjustment to net income (as detailed above)

Non-GAAP adjusted diluted net income per share

(1) To reflect a non-cash charge to operating expense for selling, general, and administrative stock-based compensation.

(2) To reflect a non-cash charge to operating expense for research and development stock-based compensation.

(3) Non-GAAP adjusted basic net income per share was calculated based on 49,700,217 and 49,648,246 weighted-average shares of common stock outstanding for the three and six months ended June 30, 2025, respectively.

(4) Non-GAAP adjusted basic net loss per share was calculated based on 48,292,414 and 48,240,835 weighted-average shares of common stock outstanding for the three and six months ended June 30, 2024, respectively.

(5) Non-GAAP adjusted diluted net income per share was calculated based on 50,144,704 and 50,003,709 weighted-average shares of common stock outstanding for the three and six months ended June 30, 2025, respectively.

(6) Potentially dilutive common stock equivalents (stock options restricted stock units and warrants) were not included in this non-GAAP adjusted diluted net loss per share for the three and six months ended June 30, 2024, as these shares would be considered anti-dilutive.

(3) Non-GAAP adjusted basic net income per share was calculated based on 50,339,456 and 49,881,181 weighted-average shares of common stock outstanding for the three and nine months ended September 30, 2025, respectively.

(4) Non-GAAP adjusted basic net income per share was calculated based on 49,008,464 and 48,498,579 weighted-average shares of common stock outstanding for the three and nine months ended September 30, 2024, respectively.

(5) Non-GAAP adjusted diluted net income per share was calculated based on 50,929,893 and 50,334,553 weighted-average shares of common stock outstanding for the three and nine months ended September 30, 2025, respectively.

(6) Non-GAAP adjusted diluted net income per share was calculated based on 49,173,361 and 49,025,103 weighted-average shares of common stock outstanding for the three and nine months ended September 30, 2024, respectively.

Off-Balance Sheet Arrangements

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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 1. Financial Statements