What changed in this filing

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Item 1. Financial Statements

2025-11-06 compared with 2025-08-06 · 99 added, 82 removed, 405 unchanged (31% of the section changed)

3 unchanged sentences

(In thousands, except share and per share data)

September 30,

Current assets:

2 unchanged sentences

Receivable from collaboration partner

Contract asset

Prepaid expenses and other current assets

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Common stock, $ 0.00001 par value, 180,000,000 shares authorized;

62,107,572 and 61,035,139 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively

62,447,102 and 61,035,139 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively

Additional paid-in capital

Accumulated other comprehensive loss

Accumulated other comprehensive income (loss)

Accumulated deficit

6 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

License and collaboration revenue

6 unchanged sentences

Other income, net

(Loss) income before income tax expense (benefit)

Income tax expense (benefit)

(Loss) income before income tax benefit (expense)

Income tax benefit (expense)

Net (loss) income

8 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Net (loss) income

Other comprehensive (loss) income:

Unrealized (loss) gain on marketable securities

Unrealized gain on marketable securities

Comprehensive (loss) income

6 unchanged sentences

(Loss) Income

Three months ended June 30, 2025

Balance at March 31, 2025

Three months ended September 30, 2025

Balance at June 30, 2025

Issuance of common stock under equity incentive and employee stock purchase plans

Stock-based compensation expense

Other comprehensive loss

Balance at June 30, 2025

Other comprehensive income

Balance at September 30, 2025

Comprehensive

1 unchanged sentence

(Loss) Income

Three months ended June 30, 2024

Balance at March 31, 2024

Three months ended September 30, 2024

Balance at June 30, 2024

Issuance of common stock under equity incentive and employee stock purchase plans

Stock-based compensation expense

Other comprehensive loss

Balance at June 30, 2024

Other comprehensive income

Balance at September 30, 2024

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

5 unchanged sentences

(Loss) Income

Six months ended June 30, 2025

Nine months ended September 30, 2025

Balance at December 31, 2024

3 unchanged sentences

Other comprehensive income

Balance at June 30, 2025

Balance at September 30, 2025

Comprehensive

1 unchanged sentence

(Loss) Income

Six months ended June 30, 2024

Nine months ended September 30, 2024

Balance at December 31, 2023

3 unchanged sentences

Stock-based compensation expense

Other comprehensive loss

Balance at June 30, 2024

Other comprehensive income

Balance at September 30, 2024

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2 unchanged sentences

(In thousands)

Six Months Ended

Nine Months Ended

September 30,

Cash Flows from Operating Activities

7 unchanged sentences

Receivable from collaboration partner

Contract asset

Prepaid expenses and other assets

16 unchanged sentences

Net cash provided by financing activities

Net increase in cash, cash equivalents and restricted cash

Net increase (decrease) in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash, beginning of period

1 unchanged sentence

Supplemental Disclosure of Non-Cash Financing and Investing Information:

Leasehold improvements obtained under tenant improvement allowance

Purchases of property and equipment in accounts payable and accrued liabilities

Right-of-use asset obtained in exchange for lease obligation

Leasehold improvements obtained under tenant improvement allowance

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

5 unchanged sentences

The Company’s clinical programs fall into two broad categories of diseases:

(i) inflammatory and immunomodulatory (“I&I”) diseases and (ii) hematology and blood disorders.

(i) inflammatory and immunomodulatory diseases and (ii) hematology and blood disorders.

Two novel peptides derived from the Company’s proprietary discovery technology platform, icotrokinra and rusfertide, are currently in advanced Phase 3 clinical development.

Icotrokinra is a first-in-class investigational targeted oral peptide that selectively blocks the Interleukin-23 receptor (“IL-23R”) and is licensed to J&J Innovative Medicines (“JNJ”), formerly Janssen Biotech, Inc.

Icotrokinra is a first-in-class investigational targeted oral peptide that selectively blocks the Interleukin-23 receptor (“IL-23R”) and is licensed to Janssen Biotech, Inc, a Johnson & Johnson company (“JNJ”).

Following icotrokinra’s joint discovery by the Company and JNJ scientists pursuant to their IL-23R collaboration, the Company was primarily responsible for the development of icotrokinra through Phase 1, with JNJ assuming responsibility for development in Phase 2 and beyond.

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Food and Drug Administration (“FDA”) by JNJ seeking the first approval of icotrokinra for the treatment of adults and pediatric patients 12 years of age or older with moderate-to-severe plaque psoriasis.

Rusfertide, a first-in-class investigational injectable mimetic of the natural hormone hepcidin, is currently in development for treatment of the rare blood disorder polycythemia vera (“PV”).

In September 2025, JNJ submitted a Marketing Authorisation Application to the European Medicines Agency for first approval of icotrokinra in adults and pediatric patients 12 years of age or older with moderate-to-severe plaque psoriasis.

Rusfertide, a first-in-class investigational injectable mimetic of the natural hormone hepcidin, is currently in development for the treatment of the rare blood disorder polycythemia vera (“PV”).

Rusfertide is being co-developed and will be co-commercialized with Takeda Pharmaceuticals, Inc.

(“Takeda”), with the Company remaining primarily responsible for clinical development through a potential NDA filing.

The Company also has a number of pre-clinical stage drug discovery programs addressing biologically and commercially validated targets, including IL-17 oral peptide antagonist PN-881, obesity triple agonist peptide PN-477, and oral hepcidin.

In August 2025, rusfertide was granted Breakthrough Therapy designation by the FDA for the treatment of erythrocytosis in patients with PV.

The Company also has a number of drug discovery and development programs addressing biologically and commercially validated targets, including IL-17 oral peptide antagonist PN-881, obesity triple agonist peptide PN-477, and oral hepcidin.

The Company is headquartered in Newark, California and has one wholly owned subsidiary, Protagonist Pty Limited (“Protagonist Australia”), located in Brisbane, Queensland, Australia.

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See Note 10 to these condensed consolidated financial statements for the Company’s interim disclosures related to the adoption of ASU 2023-07 Segment Reporting (Topic 280) Improvements to Reporting Segment Disclosures for interim periods beginning on January 1, 2025.

As of June 30, 2025, the Company had cash, cash equivalents and marketable securities of $ 673.0 million.

The Company has incurred an accumulated deficit from inception through June 30, 2025 of $ 386.9 million.

As of September 30, 2025, the Company had cash, cash equivalents and marketable securities of $ 678.8 million.

The Company has incurred an accumulated deficit of $ 426.3 million from inception through September 30, 2025.

The Company’s ultimate success depends upon the outcome of its research and development and collaboration activities.

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The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting.

As permitted under those rules, certain footnotes or other financial information that are normally required by GAAP have been condensed or omitted and, accordingly, the condensed consolidated balance sheet as of June 30, 2025 has been derived from the Company’s unaudited consolidated financial statements at that date but does not include all of the information required by GAAP for complete consolidated financial statements.

As permitted under those rules, certain footnotes or other financial information that are normally required by GAAP have been condensed or omitted and, accordingly, the condensed consolidated balance sheet as of September 30, 2025 has been derived from the Company’s unaudited consolidated financial statements at that date but does not include all of the information required by GAAP for complete consolidated financial statements.

These unaudited interim condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all adjustments (consisting of normal recurring adjustments) that are necessary for a fair presentation of the Company’s condensed consolidated financial statements.

The results of operations for the three and six months ended June 30, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025 or for any future period.

The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025 or for any future period.

The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2024 included in the Company’s Annual Report on Form 10-K, filed with the SEC on February 21, 2025.

16 unchanged sentences

Cash as reported in the condensed consolidated statements of cash flows consisted of (in thousands):

September 30,

Cash and cash equivalents

1 unchanged sentence

Total cash reported on condensed consolidated statements of cash flows

The increase in restricted cash – noncurrent as of June 30, 2025 was due to a $ 65.0 thousand deposit held as security in connection with the issuance of a bank guarantee in May 2025 to maintain the active status of the Company’s value-added tax registration.

The increase in restricted cash – noncurrent as of September 30, 2025 was due to a $ 62.0 thousand deposit held as security in connection with the issuance of a bank guarantee in May 2025 to maintain the active status of the Company’s value-added tax registration.

Stock-Based Compensation Expense

The Company has granted stock options, restricted stock units (“RSUs”) and performance stock units (“PSUs”).

Stock-based compensation expense associated with stock options is based on the estimated grant date fair value using the Black-Scholes valuation model, which requires the use of subjective assumptions related to expected stock price volatility, option term, risk-free interest rate and dividend yield.

Stock-based compensation expense associated with stock options is based on the estimated grant date fair value using the Black-Scholes valuation model, which requires the use of assumptions related to expected stock price volatility, option term, risk-free interest rate and dividend yield.

The Company recognizes compensation expense over the vesting period of the awards that are ultimately expected to vest.

5 unchanged sentences

The cumulative effect on current and prior periods of a change in the estimated number of PSUs expected to be earned is recognized as compensation expense or as reduction of previously recognized compensation expense in the period of the revised estimate.

The Company recognized $ 1.8 million of stock-based compensation expense related to PSUs for the six months ended June 30, 2025.

For the nine months ended September 30, 2025, the Company recognized $ 1.8 million of stock-based compensation expense related to 75,500 PSUs that vested during the third quarter of 2025.

The Company recognizes forfeitures of stock-based awards as they occur.

1 unchanged sentence

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Research and development

2 unchanged sentences

Significant Accounting Policies

There have been no material changes to the Company’s significant accounting policies during the three and six months ended June 30, 2025, as compared to those disclosed in Note 2.

There have been no material changes to the Company’s significant accounting policies during the three and nine months ended September 30, 2025, as compared to those disclosed in Note 2.

Summary of Significant Accounting Policies included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Recently Issued Accounting Pronouncements Not Yet Adopted as of June 30, 2025

Recently Issued Accounting Pronouncements Not Yet Adopted as of September 30, 2025

In December 2023, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update No.

13 unchanged sentences

JNJ License and Collaboration Agreement

In July 2021, the Company entered into an Amended and Restated License and Collaboration Agreement with JNJ, formerly Janssen Biotech, Inc., which amended and restated the License and Collaboration Agreement, effective July 2017, by and between the Company and JNJ, as amended in May 2019 (together, the “JNJ License and Collaboration Agreement”).

In July 2021, the Company entered into an Amended and Restated License and Collaboration Agreement with JNJ, which amended and restated the License and Collaboration Agreement, effective July 2017, by and between the Company and JNJ, as amended in May 2019 (together, the “JNJ License and Collaboration Agreement”).

The JNJ License and Collaboration Agreement relates to the development, manufacture and commercialization of oral IL-23R antagonist drug candidates and enables JNJ to develop collaboration compounds for multiple indications.

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The Company earned the $ 165.0 million milestone payment described above during the fourth quarter of 2024.

The Company has earned a total of $ 337.5 million in non-refundable payments from JNJ from inception in 2017 through June 30, 2025.

The Company has earned a total of $ 337.5 million in non-refundable payments from JNJ from inception in 2017 through September 30, 2025.

Upcoming potential milestones under the JNJ License and Collaboration Agreement include:

18 unchanged sentences

The Company received a one-time, non-refundable upfront payment of $ 300.0 million in April 2024.

In March 2025, a $ 25.0 million milestone was deemed probable of achievement following positive topline results from the Phase 3 VERIFY trial of rusfertide in PV.

In March 2025, a $ 25.0 million milestone was deemed probable of achievement following positive topline results from the Phase 3 VERIFY trial of rusfertide in PV, and payment was received in September 2025.

In addition, the Company is eligible to receive additional worldwide development, regulatory and commercial milestone payments for rusfertide of up to $ 305.0 million, and tiered royalties from 10 % to 17 % on net sales of the Licensed Products in the Takeda Territory.

The Company and Takeda will also share equally in profits and losses ( 50 % to the Company and 50 % to Takeda) for Licensed Products in the Profit-Share Territory.

Company and Takeda will also share equally in profits and losses ( 50 % to the Company and 50 % to Takeda) for Licensed Products in the Profit-Share Territory.

Takeda will book sales of the Licensed Products globally.

1 unchanged sentence

and (ii) for convenience without receipt of the Opt-out Payment (as defined below) (generally following the Initial Opt-out Period).

In addition, if

the Company does not exercise the Full Opt-out Right, the Company may opt-out of any Licensed Product other than rusfertide on a Licensed Product-by-Licensed Product basis (each, a “Partial Opt-out Right” and either the Full Opt-out Right or a Partial Opt-out right being an “Opt-out Right”).

In addition, if the Company does not exercise the Full Opt-out Right, the Company may opt-out of any Licensed Product other than rusfertide on a Licensed Product-by-Licensed Product basis (each, a “Partial Opt-out Right” and either the Full Opt-out Right or a Partial Opt-out right being an “Opt-out Right”).

Following the Company’s exercise of an Opt-out Right, the Company has agreed to transition applicable development and commercial activities to Takeda, and Takeda has agreed to assume sole operational and financial responsibility for such activities in the United States.

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The Company determined that the Takeda Collaboration Agreement met the definition of a collaborative arrangement under ASC Topic 808.

Both parties are active participants in directing and carrying out the development of

the Licensed Products and both are exposed to the significant risk and rewards related to the commercial success of the Products.

Both parties are active participants in directing and carrying out the development of the Licensed Products and both are exposed to significant risks and rewards related to the commercial success of the Products.

If the Company does not exercise an Opt-out Right (“Company Opt-in”), the Company and Takeda would co-detail the Licensed Products in the U.S.

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As such, the Company determined that Accounting Standards Codification Topic 730, “ Research and Development,” was an appropriate analogy based on the cost-sharing provisions of the agreement.

The Company concluded that payments to or reimbursements from Takeda related to these services will be accounted for as an increase to or reduction of research and development expense, respectively.

The Company concluded that payments to or reimbursements from Takeda related to these services will be accounted for as an increase to or reduction of research and development expenses, respectively.

The Company may from time to time arrange to provide goods or services from vendors to Takeda in order to facilitate Takeda’s rusfertide development efforts.

As there is no performance obligation to provide these goods or services and the Company is acting as an agent, these amounts are recorded as receivable from collaboration partner and payable to vendor until reimbursement is received.

In March 2025, the $ 25.0 million milestone was deemed probable of achievement due to the Phase 3 VERIFY trial meeting its primary endpoint, was no longer considered constrained and was added to the initial transaction price for a total transaction price of $ 325.0 million.

The additional $ 25.0 million was then allocated proportionally to each performance obligation under the agreement, resulting in an additional $ 21.3 million allocated to the license and an additional $ 3.7 million allocated to the development services under the agreement.

In September 2025, the Company received the $ 25.0 million milestone payment upon completion of the VERIFY clinical study report.

Revenue Recognition

For the three months ended June 30, 2025, the Company recognized license and collaboration revenue of $ 5.5 million related to the Takeda Collaboration Agreement, including (i) $ 5.0 million related to the initial transaction price for development services provided by the Company during the period based on the cost-based input method and (ii) $ 0.5 million related to the proportional recognition of the $ 25.0 million milestone deemed probable of being achieved due to the Phase 3 VERIFY trial meeting its primary endpoint.

For the six months ended June 30, 2025, the Company recognized license and collaboration revenue of $ 33.9 million related to the Takeda Collaboration Agreement, including (i) $ 23.4 million related to the proportional recognition of the $ 25.0 million milestone deemed probable of being achieved due to the Phase 3 VERIFY trial meeting its primary endpoint and (ii) $ 10.5 million related to the initial transaction price for development services provided by the Company during the period based on the cost-based input method.

Revenue recognition for the $ 25.0 million milestone, which is payable upon completion of the VERIFY clinical study report, was allocated based on the initial standalone selling price of each performance obligation under the agreement in March 2025.

As of June 30, 2025, the remaining $ 1.6 million in revenue related to the $ 25.0 million milestone will be recognized through the conclusion of the development services performance obligation.

The Company recorded a corresponding contract asset of $ 23.4 million on its condensed consolidated balance sheet as of June 30, 2025.

For the three months ended June 30, 2024, the Company recognized license and collaboration revenue of $ 4.2 million related to the initial Takeda Collaboration Agreement transaction price for development services provided by the Company during the period based on the cost-based input method.

For the six months ended June 30, 2024, the Company recognized license and collaboration revenue of $ 259.1 million related to the Takeda Collaboration Agreement transaction price, including (i) $ 254.1 million allocated to the rusfertide license delivered to Takeda upon effectiveness of the agreement in March 2024 and (ii) $ 5.0 million for development services provided by the Company during the period based on the cost-based input method.

The remaining unrecognized transaction price amount of $ 40.9 million related to the Takeda Collaboration Agreement was recorded as deferred revenue on the Company’s condensed consolidated balance sheet as of June 30, 2024 to be recognized over time based on a measure of the Company’s efforts toward satisfying the performance obligation relative to the total expected efforts or inputs to satisfy the performance obligation (e.g.

costs incurred compared to total budget).

For the three and six months ended June 30, 2025, the Company recognized $ 5.0 million and $ 10.5 million of revenue, respectively, that was included in the deferred revenue liability balance at the beginning of each period.

For the three months ended June 30, 2024, the Company recognized $ 4.2 million of revenue that was included in the deferred revenue liability balance at the beginning of the period.

For the six months ended June 30, 2024, the Company did no t recognize revenue from any amounts included in the deferred revenue contract liability balance at the beginning of the period.

For the three months ended September 30, 2025, the Company recognized license and collaboration revenue of $ 4.7 million related to the Takeda Collaboration Agreement for development services provided by the Company during the period based on the cost-based input method.

For the nine months ended September 30, 2025, the Company recognized license and collaboration revenue of $ 38.6 million related to the Takeda Collaboration Agreement, including (i) $ 21.3 million representing a portion of the $ 25.0 million milestone payment that was allocated to the rusfertide license delivery performance obligation under the agreement and (ii) $ 17.3 million for development services provided by the Company during the period based on the cost-based input method.

As of September 30, 2025, the remaining $ 17.0 million in deferred revenue will be recognized through the conclusion of the development services performance obligation.

For the three months ended September 30, 2024, the Company recognized license and collaboration revenue of $ 4.7 million related to the initial Takeda Collaboration Agreement transaction price for development services provided by the Company during the period based on the cost-based input method.

For the nine months ended September 30, 2024, the Company recognized license and collaboration revenue of $ 263.8 million related to the Takeda Collaboration Agreement transaction price, including (i) $ 254.1 million allocated to the rusfertide license delivered to Takeda upon effectiveness of the agreement in March 2024 and (ii) $ 9.7 million for development services provided by the Company during the period based on the cost-based input method.

The remaining unrecognized transaction price amount of $ 36.2 million related to the Takeda Collaboration Agreement was recorded as deferred revenue on the Company’s condensed consolidated balance sheet as of September 30, 2024 to be recognized over time based on the cost-based input method.

For the three and nine months ended September 30, 2025, the Company recognized $ 4.7 million and $ 14.9 million of revenue, respectively, that was included in the deferred revenue liability balance at the beginning of each period.

For the three months ended September 30, 2024, the Company recognized $ 4.7 million of revenue that was

included in the deferred revenue liability balance at the beginning of the period.

For the nine months ended September 30, 2024, the Company did no t recognize revenue from any amounts included in the deferred revenue contract liability balance at the beginning of the period.

None of the costs to obtain or fulfill the contracts were capitalized.

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The following tables present the fair value of the Company’s financial assets determined using the inputs defined above (in thousands):

June 30, 2025

September 30, 2025

Money market funds

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Treasury and agency securities, including U.S.

Treasury bills, commercial paper and corporate debt securities are classified as Level 2 as they were valued based upon quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques, for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets.

active and model-based valuation techniques, for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets.

The carrying amount of the Company’s remaining financial assets and liabilities, including cash, receivables and payables, approximates their fair value due to their short-term nature.

1 unchanged sentence

Cash equivalents and marketable securities consisted of the following (in thousands):

June 30, 2025

September 30, 2025

Gross Unrealized

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All of the Company’s marketable securities are classified as available-for-sale.

Current marketable securities of $ 401.9 million and $ 321.7 million held as of June 30, 2025 and December 31, 2024, respectively, had contractual maturities of less than one year .

Noncurrent marketable securities of $ 102.5 million and $ 140.3 million held as of June 30, 2025 and December 31, 2024, respectively, had contractual maturities of at least one year but no more than two years .

Current marketable securities of $ 462.4 million and $ 321.7 million held as of September 30, 2025 and December 31, 2024, respectively, had contractual maturities of less than one year .

Noncurrent marketable securities of $ 102.7 million and $ 140.3 million held as of September 30, 2025 and December 31, 2024, respectively, had contractual maturities of at least one year but no more than two years .

The Company does not intend to sell its securities that are in an unrealized loss position, and it is not more likely than not that the Company will be required to sell its securities before recovery of their amortized cost basis, which may be at maturity.

During the six months ended June 30, 2025, the Company sold $ 7.0 million of marketable securities and recognized a net realized loss of $ 5.0 thousand.

There were no realized gains or realized losses on marketable securities for the three months ended June 30, 2025 and three and six months ended June 30, 2024.

The Company evaluated securities with unrealized losses to determine whether such losses, if any, were due to credit-related factors and determined that there were no credit-related losses to be recognized as of June 30, 2025 and December 31, 2024.

During the nine months ended September 30, 2025, the Company sold $ 7.0 million of marketable securities and recognized a net realized loss of $ 4.0 thousand.

There were no material realized gains or realized losses on marketable securities for the three months ended September 30, 2025 and the three and nine months ended September 30, 2024.

Balance Sheet Components

1 unchanged sentence

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

September 30,

Accrued interest receivable

7 unchanged sentences

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

September 30,

Laboratory equipment

6 unchanged sentences

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

September 30,

Accrued clinical and research related expenses

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In accordance with ASC Topic 260, “ Earnings Per Share” , outstanding Pre-Funded Warrants are included in the computation of basic net (loss) income per share because the exercise price is negligible, and they are fully vested and exercisable after the original issuance date.

No Pre-Funded Warrants were exercised during the six months ended June 30, 2025.

During the six months ended June 30, 2024, Pre-Funded Warrants to purchase 84,992 shares were net exercised, resulting in the issuance of 84,989 shares of common stock.

As of June 30, 2025, Pre-Funded Warrants to purchase 1,500,000 shares of common stock remained outstanding.

The Company recorded income tax expense of $ 0.2 million for the three and six months ended June 30, 2025, which consisted of adjustments to estimated tax payments.

The Company recorded an income tax benefit of $ 0.7 million and income tax expense of $ 2.7 million for the three and six months ended June 30, 2024, respectively.

The primary difference in income tax expense as compared to the prior year was due to taxable income for the six months ended June 30, 2024 resulting from the recognition of revenue in connection with the Takeda Collaboration Agreement.

The tax provision for the three and six months ended June 30, 2024 was determined using an estimated annual effective tax rate, adjusted for discrete items, if any.

No Pre-Funded Warrants were exercised during the three and nine months ended September 30, 2025.

During the nine months ended September 30, 2024, Pre-Funded Warrants to purchase 84,992 shares were net exercised, resulting in the issuance of 84,989 shares of common stock.

As of September 30, 2025, Pre-Funded Warrants to purchase 1,500,000 shares of common stock remained outstanding.

No income tax expense was recorded by the Company for the three months ended September 30, 2025.

The Company recorded income tax expense of $ 0.2 million for the nine months ended September 30, 2025, which consisted of adjustments to estimated tax payments.

The Company recorded an income tax benefit of $ 0.4 million and income tax expense of $ 2.2 million for the three and nine months ended September 30, 2024, respectively.

The primary difference in income tax expense as compared to the prior year was due to taxable income for the nine months ended September 30, 2024 resulting from the recognition of revenue in connection with the Takeda Collaboration Agreement.

The tax provision for the three and nine months ended September 30, 2024 was determined using an estimated annual effective tax rate, adjusted for discrete items, if any.

Net (Loss) Income per Share

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Net (loss) income

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Diluted net (loss) income per share of common stock

Approximately 9.5 million potentially dilutive shares of common stock (consisting of shares subject to outstanding stock options, RSUs, PSUs, and under the ESPP) were excluded from the diluted net loss per share of common stock computation for the three and six months ended June 30, 2025 due to the Company’s net losses for these periods.

Approximately 9.9 million potentially dilutive shares of common stock (consisting of shares subject to outstanding stock options, RSUs, PSUs, and under the ESPP) were excluded from the diluted net loss per share of common stock computation for the three months ended June 30, 2024 due to the Company’s net loss for the period.

Approximately 3.4 million potentially dilutive shares of common stock (consisting of shares subject to outstanding stock options, RSUs, PSUs, and under the ESPP) were excluded from the diluted net income per share of common stock computation for the six months ended June 30, 2024 because their effect was anti-dilutive.

Approximately 9.1 million potentially dilutive shares of common stock (consisting of shares subject to outstanding stock options, RSUs, PSUs, and under the ESPP) were excluded from the diluted net loss per share of common stock computation for the three and nine months ended September 30, 2025 due to the Company’s net losses for these periods.

Approximately 9.2 million potentially dilutive shares of common stock (consisting of shares subject to outstanding stock options, RSUs, PSUs, and under the ESPP) were excluded from the diluted net loss per share of common stock computation for the three months ended September 30, 2024 due to the Company’s net loss for the period.

Approximately 3.2 million potentially dilutive shares of common stock (consisting of shares subject to outstanding stock options, RSUs, PSUs, and under the ESPP) were excluded from the diluted net income per share of common stock computation for the nine months ended September 30, 2024 because their effect was anti-dilutive.

Segment Reporting

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The Company’s CODM reviews financial information on an aggregate basis for the purpose of allocating resources and evaluating financial performance, including segment net (loss) income, which is also reported on the condensed consolidated statement of operations as consolidated net (loss) income.

Segment information is as follows (dollars in thousands):

Segmen t information is as follows (in thousands):

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Discovery department expense (1)(2)

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Interest income

Income tax (expense) benefit

Income tax benefit (expense)

Segment (loss) profit

10 unchanged sentences

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

What changed 10-Q

Item 1. Financial Statements