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Item 1A. Risk Factors

2026-02-26 compared with 2025-02-27 · 71 added, 73 removed, 890 unchanged (14% of the section changed)

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Risks Related to our Financial Condition and Capital Requirements

While we have reported net income in the years ended December 31, 2024, 2023 and 2022, we cannot assure that we will continue to do so and may not be able to maintain profitability.

While we have reported net income in recent years, we cannot assure that we will continue to do so and may not be able to maintain profitability.

We have incurred significant cumulative operating losses since our inception.

While we have reported net income in the years ended December 31, 2024, 2023 and 2022, we cannot assure that we will continue to do so and will need to continue to generate significant revenue to sustain operations and successfully commercialize neratinib and develop alisertib.

While we have reported net income in recent years, including the years ended December 31, 2025, 2024 and 2023, we cannot assure that we will continue to do so and will need to continue to generate significant revenue to sustain operations and successfully commercialize neratinib and develop alisertib.

As of December 31, 2025, we had an accumulated deficit of approximately $1,283.8 million, outstanding indebtedness of approximately $22.5 million and cash and cash equivalents and marketable securities of approximately $97.5 million.

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Failure or delay can occur at any time during the development process.

There are numerous risks associated with our planned development alisertib, including, among others:

There are numerous risks associated with our planned development alisertib, including the following:

We have limited experience developing alisertib;

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In addition, FDA and foreign regulatory authorities may change their approval policies and new regulations may be enacted.

For instance, the EU pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020.

The European Commission’s proposal for revision of several legislative instruments related to medicinal products (potentially reducing the duration of regulatory data protection, revising the eligibility for expedited pathways, etc.) was published on April 26, 2023.

The proposed revisions remain to be agreed and adopted by the European Parliament and European Council and the proposals may therefore be substantially revised before adoption, which is not expected before early 2026.

The revisions may however have a significant impact on the biopharmaceutical industry in the long term.

For instance, the EU pharmaceutical legislation has been undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020.

On April 26, 2023, the European Commission published a proposal for a new Directive and Regulation to revise the existing pharmaceutical legislation.

The proposed changes were since discussed and negotiated by the European Parliament and the Council of the EU as part of the EU ordinary legislative process.

A provisional agreement has been reached by the European Parliament and Council of the EU on the proposed revisions on December 11, 2025.

The proposed revisions (affecting the duration of regulatory data protection and market protection, including for orphan medicinal products, revising the eligibility for expedited pathways, etc.) remain to be formally adopted by the two institutions, which is not anticipated before early 2026.

The proposed changes are not expected to enter into application before 2028, and may however have a significant impact on the biopharmaceutical industry in the long term.

We are subject to ongoing obligations and continued regulatory review with regard to NERLYNX, alisertib and any other drug candidates that may receive FDA or foreign regulatory approval, which may result in significant expense.

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If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may be subject to enforcement action, which would adversely affect our business, prospects and ability to achieve or sustain profitability.

Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.

Disruptions at the FDA and other government agencies caused by funding shortages, staffing limitations or policy changes could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.

The ability of the FDA and foreign regulatory authorities to review and approve new products can be affected by a variety of factors, including government budget and funding levels, statutory, regulatory, and policy changes, the FDA’s and foreign regulatory authorities' ability to hire and retain key personnel and accept the payment of user fees, and other events that may otherwise affect the FDA’s and foreign regulatory authorities' ability to perform routine functions.

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government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical activities.

Separately, in response to the COVID-19 pandemic, the FDA postponed most inspections of domestic and foreign manufacturing facilities at various points.

If a prolonged government shutdown occurs, or if global health concerns continue to prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

In addition, the current U.S.

Presidential administration has issued certain policies and Executive Orders directed towards reducing the employee headcount and costs associated with U.S.

administrative agencies, including the FDA, and it remains unclear the degree to which these efforts may limit or otherwise adversely affect the FDA’s ability to conduct routine activities.

If a prolonged government shutdown occurs, or if funding shortages, staffing limitations or similar factors hinder or prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, such events could significantly impact the ability of the FDA or other such regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Clinical trials are very expensive, time-consuming and difficult to design and implement.

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If such post-approval studies fail to confirm the drug’s clinical benefit or are not completed in a timely manner, the FDA may withdraw its approval of the drug on an expedited basis.

In addition, in December 2022, former President Biden signed an omnibus appropriations bill to fund the U.S.

government through fiscal year 2023.

Included in the omnibus bill is the Food and Drug Omnibus Reform Act of 2022, which among other things, provided FDA statutory authority to mitigate potential risks to patients from continued marketing of ineffective drugs previously granted accelerated approval.

In addition, the Food and Drug Omnibus Reform Act of 2022, among other things, provided the FDA with additional statutory authority to mitigate potential risks to patients from continued marketing of ineffective drugs previously granted accelerated approval.

Under these provisions, the FDA may require a sponsor of a product seeking accelerated approval to have a confirmatory trial underway prior to such approval being granted.

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The majority of our revenue comes from a limited number of customers.

In 2024, four customers individually comprised approximately 28.4%, 18.8%, 14.1% and 12.3% respectively, of our total product revenue.

In 2025 , five customers individually comprised approximately 27.3%, 17.0%, 16.4%, 13.1% and 10.6%, respect ively, of our total product revenue.

We expect that revenue from a limited number of customers will continue to account for a large portion of our revenue in the future.

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As of December 31, 2025, NERLYNX has received approval for the treatment of certain patients with extended adjuvant and/or metastatic HER2-positive breast cancer in more th an 40 count ries outside the United States, including the EU, Australia, Canada, and Hong Kong.

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

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

We depend on these third parties for a significant portion of our total revenue.

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The NCCN designated NERLYNX in combination with capecitabine as a category 2A treatment option and NERLYNX in combination with paclitaxel as a category 2B treatment option.

In addition, in December 2024, we announced that NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines®) for Cervical Cancer were updated to include an addition involving neratinib.

In addition, in December 2024, we announced that NCCN Clinical Practice Guidelines in Oncology for Cervical Cancer were updated to include an addition involving neratinib.

The updated NCCN Practice Guidelines for Cervical Cancer include neratinib monotherapy for use as second-line or subsequent therapy for recurrent or metastatic disease as an option for patients with HER2-mutated tumors with a designation of category 2A.

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In the U.S., orphan designation entitles a party to financial incentives such as opportunities for grant funding for clinical trial costs, tax advantages and user-fee waivers.

In addition, if a drug candidate that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications, including an NDA, to market the same drug for the same disease or condition for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity or where the manufacturer is unable to assure sufficient product quantity.

In addition, if a drug candidate that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications, including an NDA, to market the same drug for the same approved indication or use within the same rare disease or condition for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity in the relevant indication or use or where the manufacturer is unable to assure sufficient product quantity.

We may decide to seek Orphan Drug Designations for alisertib.

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Even if we, or any future collaborators, obtain orphan drug designation for a drug candidate, we, or they, may not be able to obtain or maintain orphan drug exclusivity for that drug candidate.

Further, even if we, or any future collaborators, obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different drugs with different active ingredients may be approved for the same disease or condition.

Even after an orphan drug is approved, the FDA can subsequently approve the same drug for the same disease or condition if the FDA concludes that the later drug is clinically superior in that it is shown to be safer, more effective or makes a major contribution to patient care, or the manufacturer of the product with orphan exclusivity is unable to maintain sufficient product quantity.

Even after an orphan drug is approved, the FDA can subsequently approve the same drug for the same disease or condition if the FDA concludes that the later drug is clinically superior in the relevant indication, in that it is shown to be safer, more effective or makes a major contribution to patient care, or the manufacturer of the product with orphan exclusivity is unable to maintain sufficient product quantity to meet the needs of the approved indication or use for the patients with the relevant disease or condition.

Orphan drug designation neither shortens the development or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process.

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In the United States, the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major legislative initiatives.

In March 2010, the Affordable Care Act ( “ ACA ” ) became law in the U nited States.

In March 2010, the ACA became law in the U nited States.

The ACA substantially changed the way healthcare is financed by both governmental and private insurers and significantly affects the pharmaceutical industry.

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For example, the Budget Control Act of 2011, among other things, led to reductions to Medicare payments to providers that will remain in effect through 2032.

On January 2, 2013, the American Taxpayer Relief Act of 2012, among other things, also reduced Medicare payments to several providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

More recently, on March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 into law, which eliminated the statutory Medicaid drug rebate cap, beginning January 1, 2024.

The American Taxpayer Relief Act of 2012, among other things, also reduced Medicare payments to several providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

The American Rescue Plan Act of 2021 eliminated the statutory Medicaid drug rebate cap, beginning January 1, 2024.

The rebate was previously capped at 100% of a drug’s average manufacturer price,

Most significantly, in August 2022, President Biden signed the Inflation Reduction Act of 2022 (“IRA”) into law.

The IRA was enacted in 2022.

This statute marks the most significant action by Congress with respect to the pharmaceutical industry since adoption of the ACA in 2010.

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redesigns the Medicare Part D benefit (beginning in 2024);

and replaces the Part D coverage gap discount program with a new manufacturer discount program (beginning in 2025).

Centers for Medicare & Medicaid Services (“CMS”) has published the negotiated prices for the initial 10 drugs, which will first be effective in 2026, and has published the list of the subsequent 15 drugs that will be subject to negotiation.

The IRA permits the Secretary of the Department of Health and Human Services (“HHS”) to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

and replaces the Part D coverage gap discount program with a new manufacturer discount program (which began in 2025).

The Centers for Medicare & Medicaid Services has published the negotiated prices for the initial ten drugs, which went into effect in January 2026, and the subsequent 15 drugs, which will first be effective in 2027.

CMS has also published the next set of 15 drugs that will be subject to negotiation.

The IRA permits the Secretary of the HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

HHS has and will continue to issue and update guidance as these programs are implemented, although the Medicare drug price negotiation program is currently subject to legal challenges.

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Under the IRA manufacturer discount program that replaced the coverage gap discount program as of January 1, 2025, manufacturers must give a 10 percent discount on Part D drugs in the initial coverage phase, and a 20 percent discount on Part D drugs in the so-called “catastrophic phase” (the phase after the patient incurs costs above the initial phase out-of-pocket threshold, which will be $2,000 beginning in 2025).

The IRA allows the 10 and 20 percent discounts to be phased in over time for certain drugs for “specified manufacturers.” In April 2024, CMS informed us that we are deemed a specified small manufacturer and the discount will be phased in over several years and will increase over time.

The IRA allows the 10 and 20 percent discounts to be phased in over time for certain drugs for manufacturers that CMS deems to meet specific criteria.

In April 2024, CMS informed us that we are deemed a specified small manufacturer, and as a result, the discounts will be phased in over several years and will increase over time.

We are continuing to evaluate the potential impact of this status on our future revenues.

NERLYNX is reimbursed under Medicare Part D, and the reimbursement amount will be impacted by the 10 and 20 percent discounts under the IRA’s new discounting program (as noted above).

We anticipate that these increased discounts will impact NERLYNX revenues over time, while also having an industry-wide impact on the patient out-of-pocket costs of Part D drugs.

We anticipate that these increased discounts will impact NERLYNX revenues over time, while also having an industry-wide impact on the cost of Part D drugs.

The impact on NERLYNX revenues could be offset because the IRA’s redesign of certain Part D components, some of which went into effect in 2024, resulted in an increase in the number of patients able to afford this therapy.

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This may incentivize Part D prescription drug plans to seek greater price concessions from us in order to include NERLYNX on their formularies.

The cost of prescription pharmaceuticals in the United States has also been the subject of considerable discussion.

More recently, the One Big Beautiful Bill Act, which was enacted in July 2025, imposes significant reductions in the funding of the Medicaid program.

Such reductions are expected to decrease the number of persons enrolled in Medicaid and reduce the services covered by Medicaid, which could adversely affect our sales of NERLYNX and any other product candidate that we commercialize.

The Trump administration is pursuing a two-fold strategy to reduce drug costs in the United States.

While it is unclear whether and how the Trump proposals will be implemented, the Trump policies are likely to have a negative impact on the pharmaceutical industry and on our ability to receive adequate revenues for our products.

On the one hand, President Trump has threatened to impose significant tariffs on pharmaceutical manufacturers that do not adopt pricing policies such as most favored nation pricing, which would tie the price for drugs in the United States to the lowest price in a group of other countries.

In response, multiple manufacturers have entered into confidential pricing agreements with the federal government.

On the other hand, the Trump administration is pursuing traditional regulatory pathways to impose drug pricing policies and published two proposed regulations in December 2025, referred to as Globe and Guard.

If finalized, these regulations would implement mandatory payment models under which manufacturers of eligible drugs would be required to pay rebates to the federal government on a portion of the units of their drugs that are reimbursed by Medicare, with the rebate amount based on most favored nation pricing.

Imposing a rebate in the United States that is based on drug prices outside the United States would mark a drastic and unprecedented shift in the U.S.

pharmaceutical market, and while the impact of the Globe and Guard proposed regulations, if finalized, cannot yet be determined, it is likely to be significant.

Even regulatory proposals or executive actions that are ultimately deemed unlawful could negatively impact the U.S.

pharmaceutical sector and our business.

In addition, the cost of prescription pharmaceuticals in the United States has also been the subject of considerable discussion.

There have been several Congressional inquiries, as well as legislative and regulatory initiatives and executive orders designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drug products.

We cannot predict with certainty what impact any federal or state health reforms will have on us, but such changes could impose new or more stringent regulatory requirements on our activities or result in reduced reimbursement for our products, any of which could adversely affect our business, results of operations and financial condition.

Individual states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

Some states have enacted legislation creating so-called prescription drug affordability boards, which ultimately may attempt to impose price limits on certain drugs in these states.

Moreover, individual states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, marketing cost disclosure, drug price reporting and other transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

Some states have enacted legislation creating so-called prescription drug affordability boards, which ultimately may attempt to impose price limits on certain drugs in these states, and at least one state board is imposing an upper payment limit.

States are also seeking to implement general, across the board price caps for pharmaceuticals, or are seeking to regulate drug distribution.

In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.

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The failure of these sub-licensees to meet their contractual, regulatory or other obligations could adversely affect our business.

We have entered into exclusive sub-license agreements with several third parties that provide these sub-licensees exclusive rights to the development and commercialization of NERLYNX in Europe (excluding Russia and Ukraine), Australia, Canada, China, Southeast Asia, Israel, South Korea, and various countries and territories in Central America, South America, the Middle East and Africa.

We have entered into exclusive sub-license agreements with several third parties that provide these sub-licensees exclusive rights to the development and commercialization of NERLYNX in Europe (excluding Ukraine), Australia, Canada, China, Southeast Asia, Israel, South Korea, Russia and various countries and territories in Central America, South America, Africa and the Middle East.

As a result, we are entirely dependent on these parties to achieve regulatory approval of NERLYNX for marketing in these countries and for the commercialization of NERLYNX, if approved.

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Risks Related to our Business Operations

Our business, financial condition, results of operations and ongoing clinical trials have been, and could continue to be, harmed by the effects of public health emergencies or outbreaks of epidemics, pandemics or contagious diseases.

We and our commercial partners are subject to various risks related to potential future public health emergencies or outbreaks of epidemics, pandemics or contagious diseases, such as the COVID-19 pandemic.

For example, many geographic regions previously imposed, or in the future may impose, “shelter-in-place” orders, quarantines or similar orders or restrictions, which may prevent cancer patients from traveling to see their doctors and result in a decline in new patient enrollments/new patient starts and could adversely affect our business, financial condition and results of operations.

Additionally, certain of our personnel, such as our commercial, field medical and sales force teams, were restricted or prevented from conducting routine business activities during the height of the COVID-19 pandemic, including traveling or interacting in-person with physicians and customers, as a result of these employee health and safety concerns, “shelter-in-place” orders, travel restrictions and other actions and restrictions that may be prudent or required by governmental authorities.

Timely enrollment in our clinical trials is dependent upon global clinical trial sites which have been in the past, and may in the future be, adversely affected by the impacts of a potential resurgence of COVID-19 or other severe global health crises, and disruptions in patient enrollments could have a material adverse impact on our clinical trial plans, timelines, business, financial conditions and results of operations.

Additionally, we rely exclusively on third-party manufacturers to manufacture our products.

We, our suppliers and our manufacturers modified our business practices for the continued health and safety of our employees during the height of the COVID-19 pandemic, including by operating with the majority of our respective workforces working from home.

If a resurgence of COVID-19 or other severe global health crisis were to occur, it could disrupt our respective standard operations, including our procurement of suppliers for our operations.

In addition, this may increase our cybersecurity risk, create data accessibility concerns and make us more susceptible to communication disruptions, any of which could adversely impact our business operations or delay necessary interactions with local and federal regulators, ethics committees, manufacturing sites, research or clinical trial sites, and other important agencies and contractors.

Our business interruption insurance, if available at all, may be insufficient to cover losses resulting from extended business interruptions from public health emergencies or outbreaks of epidemics, pandemics or contagious diseases.

Engaging in international business subjects us to additional business and regulatory risks, and there can be no assurance that our products will be accepted in those markets.

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difficulties in enforcing agreements and collecting receivables through certain foreign legal systems;

political and economic instability;

political and economic instability, including trade wars, the military conflicts between Russia and Ukraine, the conflicts between Israel and Hamas, recent inflation and disruptions in the capital and credit markets that may reduce our ability to raise additional capital when needed on acceptable terms, if at all;

foreign currency risks that could adversely affect our financial results;

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We rely significantly on information technology and any failure, inadequacy, interruption or security lapse of that technology, including any cybersecurity incidents, could harm us.

Our internal computer systems and those of third parties with which we contract may be vulnerable to damage from cyberattacks, “phishing” attacks and other social engineering schemes, employee theft or misuse, human error, fraud, denial or degradation of service attacks, computer viruses, malware (e.g.

We rely on computer systems, hardware, software, technology infrastructure and online sites and networks for both internal and external operations that are critical to our business.

We own and manage some of these information technology systems but also rely on third parties for a range of information technology systems and related products and services.

We and certain of our third-party providers collect, maintain and process data about customers, employees, business partners and others, including personally identifiable information, as well as proprietary information belonging to our business such as trade secrets.

Our information technology systems and those of third parties with which we contract may be vulnerable to damage from diverse threat vectors, including cyberattacks, “phishing” attacks and other social engineering schemes, employee theft or misuse, human error, fraud, denial or degradation of service attacks, computer viruses, malware (e.g.

ransomware), sophisticated nation-state and nation-state-supported actors, unauthorized access or use by persons inside our organization or persons with access to systems inside our organization, hacking, natural disasters, terrorism, war and telecommunication and electrical failures despite the implementation of security measures.

We are also vulnerable to other cybersecurity risks and threats, including malicious code embedded in open-source software, or misconfigurations, “bugs” or other vulnerabilities in commercial software that is integrated into our (or our suppliers’ or service providers’) information technology systems, products or services.

Attacks upon information technology systems are increasing in their frequency, levels of persistence, sophistication and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives and expertise.

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We may also experience security breaches that may remain undetected for an extended period.

Even if identified, we may be unable to adequately investigate or remediate incidents or breaches due to attackers increasingly using tools and techniques that are designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence.

Even if identified, we may be unable to adequately investigate or remediate incidents or breaches due to attackers increasingly using tools and techniques – including artificial intelligence – that are designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence.

System failures, accidents or security breaches could cause interruptions in our operations and could result in a material disruption of our clinical activities and business operations, in addition to possibly requiring substantial expenditures of resources to remedy.

The loss of clinical trial data could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data.

Furthermore, any integration of artificial intelligence in our or any third party’s operations, products or services is expected to pose new or unknown cybersecurity risks and challenges.

To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and our research and development programs, and the development of our drug candidates could be delayed.

The risk of a security breach or disruption, particularly through cyberattacks or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased and evolved.

If we or our third-party vendors were to experience a significant cybersecurity breach of our or their information systems or data, the costs associated with the investigation, remediation and potential notification of the breach to counterparties and data subjects could be material.

In addition, our remediation efforts may not be successful.

There can also be no assurance that our cybersecurity risk management program and processes, including our policies, controls or procedures, will be fully implemented, complied with or effective in protecting our information technology systems and confidential information.

If we do not allocate and effectively manage the resources necessary to build and sustain the proper technology and cybersecurity infrastructure, we could suffer significant business disruption, including transaction errors, supply chain or manufacturing interruptions, processing inefficiencies, data loss or the loss of or damage to intellectual property or other proprietary information.

We and certain of our service providers are from time to time subject to cyberattacks and security incidents.

We and certain of our service providers are from time to time subject to cyberattacks and security incidents that threaten the confidentiality, integrity and availability of our information technology systems and confidential information.

While we do not believe that we have experienced any significant system failure, accident or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our development programs and our business operations, whether due to a loss, corruption or unauthorized disclosure of our trade secrets, personal information or other proprietary or sensitive information or other similar disruptions.

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Any security compromise affecting us, our service providers, strategic partners, other contractors, consultants, or our industry, whether real or perceived, could harm our reputation, erode confidence in the effectiveness of our security measures and lead to regulatory scrutiny.

To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or systems, or inappropriate disclosure of confidential or proprietary or personal information, we could incur liability, including litigation exposure, penalties and fines, we could become the subject of regulatory action or investigation, our competitive position could be harmed and the further development and commercialization of our products and services could be delayed.

To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or systems, or inappropriate disclosure of confidential or proprietary or personal information, we could incur liability, such as litigation exposure (including class actions), penalties and fines, we could become the subject of regulatory action or investigation, our competitive position could be harmed and the further development and commercialization of our products and services could be delayed.

If such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our business.

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Depending on the facts and circumstances, we could be subject to criminal penalties if we knowingly obtain, use, or disclose individually identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.

Certain states have also enacted data privacy and security laws and regulations, which govern the privacy, processing and protection of health-related and other personal information.

A number of U.S.

states have also enacted data privacy and security laws and regulations, which govern the privacy, processing and protection of health-related and other personal information.

Such laws and regulations will be subject to interpretation by various courts and other governmental authorities, thus creating potentially complex compliance issues for us and our future customers and strategic partners.

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Additional compliance investment and potential business process changes may also be required.

Similar laws have been passed in other states and are continuing to be proposed at the state and federal level, reflecting a trend toward more stringent privacy legislation in the United States.

Similar laws have been passed in other states, reflecting a trend toward more stringent privacy legislation in the United States.

The enactment of such laws could have potentially conflicting requirements that would make compliance challenging.

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In addition, the regulatory framework for the receipt, collection, processing, use, safeguarding, sharing and transfer of personal and confidential data is rapidly evolving and is likely to remain uncertain for the foreseeable future as new global privacy rules are being enacted and existing ones are being updated and strengthened.

For example, on May 25, 2018, the European Union General Data Protection Regulation (“GDPR”) took effect in Europe.

The GDPR is directly applicable in each European Union and EEA member state and applies to companies established in the European Union and the EEA as well as companies that collect and use personal data to offer goods or services to, or monitor the behavior of, individuals in the European Union and the EEA.

GDPR imposes stringent data protection obligations for processors and controllers of personal data, and penalties and fines for failure to comply with GDPR are significant, including fines of up to €20 million or 4% of total worldwide annual turnover, whichever is greater.

For example, we may be subject to the EU General Data Protection Regulation (“EU GDPR”) and to the United Kingdom General Data Protection Regulation and Data Protection Act 2018 (collectively, the “UK GDPR”) (the EU GDPR and UK GDPR together referred to as the “GDPR”).

The GDPR is directly applicable in each EU and EEA member state and the UK and applies to companies established in the EU and the EEA or UK as well as companies that collect and use personal data to offer goods or services to, or monitor the behavior of, individuals in the EU and the EEA or UK.

The GDPR imposes stringent data protection obligations for processors and controllers of personal data, and penalties and fines for failure to comply with GDPR are significant, including fines of up to €20 million / £17.5 million or 4% of total worldwide annual turnover, whichever is greater.

Among other requirements, the GDPR regulates transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States, and the efficacy and longevity of current transfer mechanisms between the EEA and the United States remains uncertain.

Case law from the Court of Justice of the European Union (“CJEU”) states that reliance on the standard contractual clauses – a standard form of contract approved by the European Commission as an adequate personal data transfer mechanism alone may not necessarily be sufficient in all circumstances and that transfers must be assessed on a case-by-case basis The European Commission adopted its Adequacy Decision in relation to the DPF on July 10, 2023, rendering the DPF effective as a GDPR transfer mechanism to U.S.

entities self-certified under the DPF.

The DPF also introduced a new redress mechanism for EU citizens which addresses a key concern in the previous CJEU judgments and may mean transfers under standard contractual clauses are less likely to be challenged in future.

We currently rely on the EU standard contractual clauses to transfer personal data outside the EEA and the UK, including to the United States, with respect to both intragroup and third-party transfers.

We expect the existing legal complexity and uncertainty regarding international personal data transfers to continue.

In particular, we expect the DPF Adequacy Decision to be challenged and international transfers to the United States and to other jurisdictions more generally to continue to be subject to enhanced scrutiny by regulators.

As a result, we may have to make certain operational changes and we will have to implement revised standard contractual clauses and other relevant documentation for existing data transfers within required time frames.

Further, since January 1, 2021, companies must comply with the GDPR and also the UK data protection regime, which imposes separate but similar obligations to those under the GDPR.

The UK GDPR mirrors the fines under the GDPR, i.e., fines up to the greater of €20 million (£17.5 million) or 4% of global turnover.

On October 12, 2023, the UK Extension to the DPF came into effect (as approved by the UK Government), as a UK GDPR data transfer mechanism to U.S.

entities self-certified under the UK Extension to the DPF.

As we continue to expand into other foreign countries and jurisdictions, we may be subject to additional laws and regulations that may affect how we conduct business.

Case law from the Court of Justice of the European Union (“CJEU”) states that reliance on the standard contractual clauses – a standard form of contract approved by the European Commission as an adequate personal data transfer mechanism alone may not necessarily be sufficient in all circumstances and that transfers must be assessed on a case-by-case basis We expect the existing legal complexity and uncertainty regarding international personal data transfers to continue and international transfers to the United States and to other jurisdictions more generally to continue to be subject to enhanced scrutiny by regulators.

As the regulatory guidance and enforcement landscape in relation to data transfers continue to develop, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we operate our business, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.

Although we work to comply with applicable laws, regulations and standards, our contractual obligations and other legal obligations, these requirements are evolving and may be modified, interpreted and applied in an inconsistent manner from one jurisdiction to another, and may conflict with one another or other legal obligations with which we must comply.

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If we are unable to hire additional qualified personnel, our ability to grow our business may be harmed

As of December 31, 2024, we had 172 employees.

As of December 31, 2025, we h ad 179 emplo yees.

Our future success depends on our ability to identify, attract, hire, train, retain and motivate other highly skilled scientific, technical, marketing, managerial and financial personnel.

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This risk is especially relevant for us because pharmaceutical companies have experienced significant stock price volatility in recent years.

These types of lawsuits are subject to inherent uncertainties, and are expensive and time-consuming to investigate, defend and resolve.

For instance, in Hsu v.

Puma Biotechnology, Inc., the plaintiff alleged that we and certain of our executive officers made false or misleading statements and failed to disclose material adverse facts about our business, operations, prospects and performance in violation of the Exchange Act.

In February 2019, a jury found that three of the four challenged statements were not false and misleading, and thus found in the defendants' favor on those claims.

In December 2021, the Court issued an order preliminarily approving the parties’ settlement which provides for two installment payments by us of approximately $27.1 million each, which were paid in January and June 2022.

On August 3, 2022, the Court ordered final approval of the parties’ settlement and dismissed the case, and the matter is now concluded.

These types of lawsuits are subject to inherent uncertainties, and are expensive and time-consuming to investigate, defend and resolve, and in the past, we have been a defendant in such lawsuits.

Any other litigation to which we are a party may similarly divert our management’s attention and financial and other resources or result in an onerous or unfavorable judgment that may not be reversed upon appeal or in payments of substantial monetary damages or fines.

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Additionally, valuation allowances needed for deferred tax assets that we estimate are more likely than not to be unusable, based on available evidence at the time the estimate is made.

For the year ended December 31, 2024, we released $7.1 million of our valuation allowance related to deferred tax assets, and recorded a valuation allowance of $343.5 million as of December 31, 2024.

For the year ended December 31, 2025, we recorded a partial release of $3.8 milli on of our valuation allowance related to deferred tax assets, resulting in a total valuation allowance o f $324.8 million as of December 31, 2025.

See Note 12–Income Taxes in the notes to the financial statements included in this Annual Report for further information.

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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-K

Item 1A. Risk Factors