What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-05-22 compared with 2024-05-16 · 71 added, 74 removed, 244 unchanged (37% of the section changed)

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We are a clinical-stage biotechnology company committed to applying our leading expertise in the field of oncolytic immunotherapy to transform the lives of cancer patients through our novel oncolytic immunotherapies.

Our proprietary

oncolytic immunotherapy product candidates are designed and intended to maximally activate the immune system against cancer.

Our proprietary oncolytic immunotherapy product candidates are designed and intended to maximally activate the immune system against cancer.

Oncolytic immunotherapy is an emerging drug class, which we intend to establish as the second cornerstone of immune-based cancer treatments, alongside checkpoint blockade.

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Our product candidates incorporate multiple mechanisms into a practical “off-the-shelf” approach that is intended to maximize the immune response against a patient’s cancer and to offer significant advantages over other approaches of inducing anti-tumor immunity, including personalized vaccine approaches.

We believe that the bundling of multiple approaches for the treatment of cancer into single therapies may improve patient outcomes and simplify the development path of our product candidates.

We believe that the bundling of multiple approaches for the treatment of cancer into single therapies will increase clinical efficacy and simplify the development path of our product candidates, while also improving patient outcome.

Since our inception, we have devoted substantially all of our resources to developing our proprietary RPx platform, building our intellectual property portfolio, conducting research and development of our product candidates, business planning, raising capital and providing selling, general and administrative support for our operations.

To date, we have incurred significant operating losses and we have financed our operations primarily with proceeds from the sale of equity securities and to a lesser extent the proceeds from the issuance of debt securities.

Our ability to generate product revenue sufficient to achieve profitability will depend on the successful development and eventual commercialization, if approved, of one or more of our product candidates.

Our ability to generate product revenue sufficient to achieve profitability will depend on the successful development and eventual commercialization of one or more of our product candidates.

We do not have any products approved for sale and have not generated any revenue from product sales.

Since our initial public offering, or IPO, on July 20, 2018, we have raised an aggregate of approximately $849.1 million in net proceeds to fund our operations, of which $101.2 million was from our IPO, $706.0 million was from four separate follow-on offerings, or the Public Offerings, that we closed in November 2019, June 2020, October 2020 and December 2022, respectively, and $41.9 million was from at-the-market offerings.

Since our initial public offering, or IPO, on July 20, 2018, we have raised an aggregate of approximately $1,101.8 million in net proceeds to fund our operations, of which $101.2 million was from our IPO, $862.0 million was from five separate follow-on offerings, or the Public Offerings, that we closed in November 2019, June 2020, October 2020, December 2022, and November 2024, respectively, $96.7 million was from our private placement transaction in June 2024, and $41.9 million was from at-the-market offerings.

Our net losses were $247.3 million and $215.8 million for the years ended March 31, 2025 and 2024, respectively.

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Even if we are able to generate product sales, we may not become profitable.

If we fail to become profitable or are

unable to sustain profitability on a continuing basis, then we may be unable to continue our operations at planned levels and be forced to reduce or terminate our operations.

If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to continue our operations at planned levels and be forced to reduce or terminate our operations.

As of March 31, 2025, we had cash and cash equivalents and short-term investments of $483.8 million.

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Components of our results of operations

To date, we have not generated any revenue from product sales as we do not have any approved products and do not expect to generate any revenue from the sale of products in the near future.

To date, we have not generated any revenue from product sales as we do not have any approved products and we can not be certain we will generate any revenue from the sale of products in the future.

If our development efforts for RP1 or any other product candidates that we may develop in the future are successful and result in regulatory approval, or if we enter into collaboration or license agreements with third parties, we may generate revenue in the future from a combination of product sales or payments from those collaborations or license agreements.

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Research and development expenses consist primarily of costs incurred for our research activities, including our discovery efforts and the development of our product candidates, and include:

• expenses incurred under agreements with third parties, including CROs, that conduct research, preclinical activities and clinical trials on our behalf as well as CMOs that manufacture our raw materials and/or product candidates for use in our preclinical and clinical trials;

• expenses incurred under agreements with third parties, including clinical research organizations, or CROs, that conduct research, preclinical activities and clinical trials on our behalf as well as contract manufacturing organizations, or CMOs that manufacture our product candidates for use in our preclinical and clinical trials;

• salaries, benefits and other related costs, including stock-based compensation expense, for personnel engaged in research and development functions;

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Payments for these activities are based on the terms of the individual agreements, which may differ from the pattern of costs incurred, and are reflected in our consolidated financial statements as prepaid or accrued research and development expenses.

Our direct external research and development expenses are tracked on a program-by-program basis and consist of costs, such as fees paid to consultants, contractors, CMOs, and CROs in connection with our preclinical and clinical development activities.

Direct research and development costs, consisting of costs, such as fees paid to consultants, contractors, CMOs and CROs in connection with our preclinical and clinical development activities, are tracked by study.

Additional costs, consisting primarily of our initial manufacturing costs, including materials, supplies, depreciation and facility costs, are allocated at a program level, based upon manufacturing runs, as the drug product can be utilized across multiple studies for any particular program.

Additional costs to label, package and distribute the drug product is then directly allocated to the specific studies when

incurred, as that drug product has then been assigned to a particular study.

In the event our additional future or ongoing study costs become meaningful to investors, we will present those costs by study.

We do not allocate personnel costs, costs associated with our discovery efforts, laboratory supplies or other indirect costs, to specific product development programs because these costs are deployed across multiple product development programs and, as such, are not separately classified.

Non-employee costs associated with our manufacturing facility including depreciation, amortization and facility costs are appropriately allocated to development programs based on the percentage of time spent per program.

Research and development activities are central to our business model.

Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials.

We expect that our research and development expenses will continue to increase for the foreseeable future as we continue enrollment and initiate additional clinical trials and continue to discover and

develop additional product candidates.

The successful development and commercialization of our product candidates is highly uncertain.

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• the successful completion of clinical trials with safety, tolerability, and efficacy profiles that are satisfactory to the FDA or any comparable foreign regulatory authority;

• the receipt of regulatory approvals from applicable regulatory authorities;

• the receipt of regulatory approvals from applicable regulatory authorities, if any, and our ability to maintain approval of any of our product candidates;

• our success in operating our manufacturing facility, or securing manufacturing supply through relationships with third parties;

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Selling, general and administrative expenses consist primarily of salaries and other related costs, including stock-based compensation, for personnel in our executive, finance, corporate, commercial, and business development and administrative functions.

Selling, general and administrative expenses also include professional fees for legal, patent, accounting, auditing, tax and consulting services, pre-commercial planning, marketing and strategic planning, business development, travel expenses, and facility-related expenses, which include direct depreciation costs and allocated expenses for rent and maintenance of facilities and other operating costs.

We expect that our selling, general and administrative expenses will continue to increase in the future as we increase our selling, general and administrative headcount to support our continued research and development and pre-launch activities to prepare for potential commercialization of our product candidates.

Selling, general and administrative expenses also include professional fees for legal, patent, accounting, auditing, tax and consulting services, pre-commercial planning, travel expenses, and facility-related expenses, which include direct depreciation costs and allocated expenses for rent and maintenance of facilities and other operating costs.

We expect that our selling, general and administrative expenses will continue to increase in the future as we increase our selling, general and administrative headcount to support our continued operations and pre-launch activities to prepare for potential commercialization of our product candidates.

We also expect to continue to incur increased expenses, including accounting, audit, legal, regulatory and tax-related services associated with maintaining compliance with exchange listing and SEC requirements;

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Interest expense on debt obligations consists of the amortization of debt discount and cash paid for interest under the Hercules Loan Agreement.

Other income (expense), net

Other income (expense), net consists primarily of realized and unrealized foreign currency transaction gains and losses.

Other (expense) income, net

Other (expense) income, net consists primarily of realized and unrealized foreign currency transaction gains and losses.

During the year ended March 31, 2025 and 2024, the Company recorded an income tax provision of $0.5 million and $0.4 million, respectively, related to U.S.

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and the U.K., as well as unfavorable adjustments related to stock compensation, resulting in U.S.

taxable income reduced by certain prior year available net operating losses.

taxable income partially reduced by certain tax attributes and U.S.

tax partially reduced by certain credits and U.S.

tax partially reduced by certain credits.

Results of operations

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Interest expense on debt obligations (5,775) (4,497) (1,278) 28 %

Other income (expense) 771 (5,676) 6,447 (114) %

Other (expense) income (202) 771 (973) (126) %

Total other income (expense), net 14,798 19,387 (4,589) (24) %

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Direct research and development expenses by program:

RP1 51,492 39,641 11,851 30 %

RP1 program costs by study:

14,620 16,641 (2,021) (12) %

6,934 6,198 736 12 %

7,276 16,165 (8,889) (55) %

7,183 2,042 5,141 252 %

Other RP1 study costs

10,863 10,446 417 4 %

Total RP1 costs

46,876 51,492 (4,616) (9) %

RP2 12,043 10,701 1,342 13 %

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Personnel related (including stock-based compensation)

Other 19,213 16,271 2,942 18 %

91,578 80,395 11,183 14 %

34,002 19,213 14,789 77 %

Total research and development expenses $ 189,447 $ 174,963 $ 14,484 8 %

The total increase of $48.4 million was due to an increase of approximately $18.7 million in direct research costs related to our ongoing clinical trials and increased patient enrollment for RP1, RP2 and RP3, including an increase of approximately $13.3 million in the areas of CRO costs, investigator costs, and imaging costs.

The costs for RP1 also increased compared to the prior year as we prepared the primary analysis and preparations for a potential BLA filing for CERPASS as well as the initial full data presentation for IGNYTE and preparations for a potential BLA submission for IGNYTE.

In addition, we focused on an updated data presentation on the ARTACUS trial.

Furthermore, we continued to ramp up activities to develop RP2 throughout the year ended March 31, 2024 as compared to the prior year, whereas activities for RP3 remained consistent year over year as a result of the deprioritization of development efforts on this product candidate during the later part of fiscal 2024.

The increase of $29.7 million in our unallocated expenses was due primarily to a $26.8 million increase in personnel-related costs, including a $22.1 million increase in payroll and fringe benefits and a stock-based compensation increase of $4.7 million.

The increase in personnel-related costs largely reflected the hiring of additional personnel in our research and development functions as we expand the development plan in multiple indications.

Personnel related costs for the years ended March 31, 2024 and 2023 included stock-based compensation expense of $14.7 million and $10.1 million, respectively.

The total increase of $14.5 million in research and development expenses was driven by an increase of $26.0 million in unallocated expenses, partially offset by a decrease of $11.5 million in our direct research and development costs.

The increase in unallocated expenses includes $14.8 million in other costs and $11.2 million in personnel-related costs.

The increase in other costs is driven primarily by an increase in consulting costs, medical affairs and facility costs.

The increase in personnel-related costs largely reflected the hiring of additional personnel in our research and development functions, most specifically within the manufacturing departments, as we prepared and scaled operations for commercial launch.

The decrease of approximately $11.5 million in our direct research and development costs primarily relates to a decrease of $8.2 million related to RP3 as a result of the deprioritization of development efforts on this product candidate, which began in

the second half of the prior fiscal year, as well as a decrease of $4.6 million in RP1 costs as a result of declining enrollment and the wind down of the CERPASS study and completion of enrollment in the IGNYTE advanced melanoma cohort.

These decreases are slightly offset by an increase of approximately $1.3 million in RP2 costs as the Company began to ramp up costs for the MUM study, specifically with spending related to set up costs and Clinical Research Organization ("CRO") costs.

In addition, in the prior year, the company incurred costs related to manufacturing batches for RP1, as well as significant costs related to the CERPASS trial in the areas of CROs, investigators and imaging costs in preparation of the primary data release, which did not recur in the current year.

Selling, general and administrative expenses

Selling, general and administrative expenses were $72.2 million for the year ended March 31, 2025, compared to $59.8 million for the year ended March 31, 2024.

The increase of $9.3 million is primarily the result of an increase of $6.3 million in personnel related costs, including an increase of $5.0 million in payroll and fringe benefits and a stock-based compensation increase of $1.3 million.

The increase in personnel related costs was driven by the continued hiring of additional personnel within our selling, general and administrative functions, specifically focusing on commercial planning and building of our initial commercial infrastructure.

The increase of $12.4 million in sales, general and administrative costs is driven primarily by an increase of $9.3 million in sales and marketing costs related to promotional materials, market access and insights and analytics, as the Company prepares for a potential commercial launch of RP1.

In addition, there is a year over year increase of $4.3 million in personnel related costs, comprised of an increase of $7.1 million in payroll and fringe benefits offset by a stock-based compensation decrease of $2.8 million.

Personnel related costs for the year ended March 31, 2025 and 2024 included stock-based compensation expense of $16.6 million and $19.4 million, respectively.

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Other income for the year ended March 31, 2025 was $14.8 million compared to $19.4 million for the year ended March 31, 2024.

The net change of $16.3 million is primarily attributable to an increase of $13.4 million in investment income in the current year as compared to the prior year as a result of increases in interest rates throughout the year, as well as a $6.4 million decrease in expense due to the changes in foreign exchange rates of the Great British Pound to United States Dollar.

These increases were partially offset by an increase in expense of $2.5 million of interest expense on debt obligations, as the Company drew down an additional term loan advance of $15.0 million in December 2023 from the debt agreement with Hercules.

The net change of $4.6 million is primarily attributable to a decrease of $2.2 million in investment income in the current year as compared to the prior year as a result of the cash and investment balance being lower throughout the year as compared to the prior year due to normal cash burn, as well as an increase in interest expense on debt obligations in the amount of $1.3 million as a result of a higher debt balance during the current year vs.

the prior year.

In addition, there is a $1.0 million increase in expense due to the changes in foreign exchange rates of the Great British Pound to United States Dollar.

Income tax provision

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and the U.K., as well as unfavorable adjustments related to stock compensation, resulting in U.S.

taxable income reduced by certain prior year available net operating losses.

taxable income partially reduced by certain prior year available net operating losses and U.S.

tax partially reduced by certain credits.

Liquidity and capital resources

Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations.

We have not yet commercialized any of our product candidates, which are in various phases of preclinical and clinical development, and we do not expect to generate revenue from sales of any products for the foreseeable future, if at all.

Until we are able to generate sufficient revenue from RP1 and our other product candidates that we develop, if at all, we anticipate that we will continue to incur significant operating losses and negative cash flows from our operations.

Sources of liquidity

To date, we have financed our operations primarily with proceeds from the sale of equity securities and, to a lesser extent, proceeds from borrowing under a secured loan facility.

Through March 31, 2024, we had received net proceeds of $935.9 million through the sale of equity securities, as well as net $42.8 million from our incurrence of debt under the Hercules Loan Agreement.

Through March 31, 2025, we had received net proceeds of $1,101.8 million through the sale of shares of common stock and pre-funded warrants exercisable for common stock in public offerings, a private placement transaction, and at-the-market offerings, as well as our incurrence of debt under the Hercules Loan Agreement.

As of March 31, 2025, we had cash and cash equivalents and short-term investments of $483.8 million.

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Net cash used in operating activities $ (192,250) $ (185,467)

Net cash provided by (used in) investing activities

Net cash (used in) provided by investing activities

(23,796) 97,201

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Operating activities

During the year ended March 31, 2025, net cash used in operating activities was $192.3 million, primarily resulting from our net loss of $247.3 million, which was partially offset by non-cash charges of $31.0 million, consisting primarily of stock-based compensation expense of $35.0 million and depreciation expense of $3.5 million, somewhat offset by $8.9 million related to the net amortization of premiums and discounts on short-term investments.

Additionally, there was an increase in cash of $24.1 million related to changes in our operating assets and liabilities.

Changes in our operating assets and liabilities for the year ended March 31, 2025 consisted primarily of a $11.7 million increase in accrued expenses and other current liabilities, a $9.9 million increase in accounts payable, and a net $2.4 million change in operating and financing right-of-use assets and lease liabilities.

During the year ended March 31, 2024, net cash used in operating activities was $185.5 million, primarily resulting from our net loss of $215.8 million, which was partially offset by non-cash charges of $24.8 million, consisting primarily of stock-based compensation expense of $34.1 million offset by $12.3 million related to the net amortization of premiums and discounts on short-term investments.

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Changes in our operating assets and liabilities for the year ended March 31, 2024 consisted primarily of a $9.2 million increase in accrued expenses and other current liabilities, a $2.8 million decrease in accounts payable, and a net $2.4 million change in operating and financing right-of-use assets and lease liabilities.

During the year ended March 31, 2023, net cash used in operating activities was $128.1 million, primarily resulting from our net loss of $174.3 million, partially offset by non-cash charges of $31.1 million, consisting primarily of stock-based compensation expense of $28.1 million, and an increase in cash of $15.1 million related to changes in our operating assets and liabilities.

Changes in our operating assets and liabilities for the year ended March 31, 2023 consisted primarily of a $11.4 million increase in accrued expenses and other current liabilities, a net $2.4 million change in operating and financing right-of-use assets and lease liabilities, and a $2.0 million increase in accounts payable.

Investing activities

During the year ended March 31, 2025, net cash used in investing activities was $23.8 million, consisting of $403.6 million in purchases of available for sale securities and $6.7 million in purchases of property, plant and equipment, partially offset by $386.5 million in proceeds from sales and maturities of short-term investments.

During the year ended March 31, 2024, net cash provided by investing activities was $97.2 million, consisting of $592.4 million in proceeds from sales and maturities of short-term investments, partially offset by $489.5 million in purchases of available for sale securities and $5.7 million in purchases of property, plant and equipment.

During the year ended March 31, 2023, net cash used in investing activities was $142.5 million, consisting of $583.4 million in purchases of available for sale securities and $2.3 million in purchases of property, plant and equipment, offset by $443.2 million in proceeds from sales and maturities of short-term investments.

Financing Activities

During the year ended March 31, 2025, net cash provided by financing activities was $252.4 million, consisting primarily of $252.7 million in proceeds from the Company's private placement transaction in June 2024 as well as the Company's November 2024 public offering.

During the year ended March 31, 2024, net cash provided by financing activities was $16.3 million, consisting primarily of $15.0 million in proceeds from the incurrence of debt under the Hercules Loan Agreement, as well as approximately $1.8 million in proceeds from the exercise of stock options.

During the year ended March 31, 2023, net cash provided by financing activities was $311.3 million, consisting primarily of $149.9 million in proceeds from the issuance of common stock, $92.8 million from the issuance of pre-funded warrants to purchase common stock, $37.4 million from the issuance of common stock through sales under our at-the-market facilities, $28.2 million in proceeds from the incurrence of debt under the Hercules Loan Agreement, as well as approximately $3.4 million in proceeds from the exercise of stock options.

Funding requirements

Our plan of operation is to continue implementing our business strategy, continue research and development of RP1 and our other product candidates and continue to expand our research pipeline and our internal research and development capabilities.

We expect our expenses to increase substantially in connection with our ongoing activities, particularly as we advance the preclinical activities and clinical trials of our product candidates and if and as we:

• conduct our current and future clinical trials with RP1, RP2 and RP3;

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• add operational, financial and management information systems and personnel, including personnel to support our research and development programs, any future commercialization efforts and operations as a public company.

As of March 31, 2024, we had cash and cash equivalents and short-term investments of $420.7 million.

Based on our current operating plan, we believe that our existing cash, cash equivalents and short-term investments as of March 31, 2024, will enable us to fund operations into the second half of 2026.

As of March 31, 2025, we had cash and cash equivalents and short-term investments of $483.8 million and $46.4 million in long term debt.

Based on our current operating plan, we believe that our existing cash, cash equivalents and short-term investments as of March 31, 2025, will enable us to fund operations into the calendar fourth quarter of 2026 which includes scale up for the potential commercialization of RP1 in skin cancers and for working capital and general corporate purposes and excludes any potential revenue.

We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect.

Because of the numerous risks and uncertainties associated with the development of RP1 and other product candidates and programs, and because the extent to which we may enter into collaborations with third parties for development of our product candidates is unknown, we are unable to estimate the timing and amounts of increased capital outlays and operating expenses associated with completing the research and development of our product candidates.

Our future capital requirements will depend on many factors, including those described in this section and above under “— Operating expenses — Research and development expenses.”

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We have entered into arrangements that contractually obligate us to make payments that will affect our liquidity and cash flows in future periods.

Our contractual obligations include those related to our operating and financing leases, long-term debt, as well as costs associated with contracts entered into in the normal course of business with CROs, CMOs and other third parties for clinical trials and preclinical research studies and testing.

Our contractual obligations include those related to our operating and financing leases, long-term debt,

as well as costs associated with contracts entered into in the normal course of business with CROs, CMOs and other third parties for clinical trials and preclinical research studies and testing.

Lease Commitments

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In April 2019, we entered into a separate agreement with BMS on terms similar to the terms set forth in the agreement described above, pursuant to which BMS will provide, at no cost to us, nivolumab for use in our Phase 1 clinical trial of RP2 in combination with nivolumab.

In May 2018, we entered into a Master Clinical Trial Collaboration and Supply Agreement with Regeneron.

Pursuant to the agreement we agreed to undertake one or more clinical trials with Regeneron for the administration of our product candidates in combination with cemiplimab, an anti-PD-1 therapy developed by Regeneron, across multiple solid tumor types, the first of which is our ongoing Phase 2 clinical trial testing RP1 in combination with cemiplimab versus cemiplimab alone in patients with CSCC.

Each clinical trial will be conducted pursuant to an agreed study plan which, among other things, will identify the name of the sponsor and which party will manage the particular study, and include the protocol, the budget and a schedule of clinical obligations.

Pursuant to the terms of the agreement, each party granted the other party a non-exclusive license of their respective intellectual property and agreed to contribute the necessary resources needed to fulfill their respective obligations, in each case, under the terms of agreed study plans.

The Company does not expect any further reimbursements from Regeneron related to the initial study plan of June 2018 and the CERPASS trial.

The agreement contains representations, warranties, undertakings and indemnities customary for a transaction of this nature.

The agreement also contains certain time-based covenants that restrict us from entering into a third-party arrangement with respect to the use of our product candidates in combination with an anti-PD-1 therapy and that restrict Regeneron from entering into a third-party arrangement with respect to the use of cemiplimab in combination with an HSV-1 virus, in each case, for the treatment of a tumor type that is the subject of a clinical trial to which the covenants apply.

Unless otherwise mutually agreed in a future study plan, these covenants are only applicable to our ongoing Phase 2 clinical trial in CSCC.

The agreement may be terminated by either party if (i) there is no active study plan for which a final study report has not been completed and the parties have not entered into a study plan for an additional clinical trial within a period of time after the delivery of the most recent final study report or (ii) in the event of a material breach.

In December 2022, we entered into a Master Clinical Trial Collaboration and Supply Agreement with Roche in relation to our RP2 and RP3 programs in colorectal cancer, or CRC, and hepatocellular carcinoma, or HCC.

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Following our re-prioritization of our product development portfolio in December 2023, we have agreed with Roche to terminate the CRC collaboration and pursue the 2L cohort in HCC with RP2 only.

Roche has expressed its intent to continue to supply its currently approved drugs, atezolizumab and bevacizumab for the 2L cohort in HCC but is unlikely to share costs following our re-prioritization.

We are in discussions with Roche about revising these agreements following our changes to our RP2 and RP3 development plans.

Under the terms of the initial agreement we retained the responsibility of operating the clinical trials as well as retaining all the rights to the development and commercialization of our product candidates.

Roche has continued to supply its currently approved drugs, atezolizumab and bevacizumab for the 2L cohort in HCC but is not sharing costs following our re-prioritization.

Under the terms of the initial agreement we retained the responsibility of operating the

clinical trials as well as retaining all the rights to the development and commercialization of our product candidates.

The agreement may be terminated by either party upon sixty days prior written notice to the other party.

In July 2023, we entered into a Clinical Trial Collaboration and Supply Agreement with Incyte Corporation, or Incyte.

Under the agreement, the companies will collaborate in a signal finding study in which Incyte will initiate and sponsor a clinical trial of INCB99280 (oral PD-L1 inhibitor) and RP1 in approximately 40 patients with unresectable, high risk CSCC in the neoadjuvant setting.

Under the terms of the agreement, we will supply Incyte with RP1 for the study and share costs of the study equally with Incyte.

The agreement may be terminated by either party upon (i) a material breach not reasonably cured within thirty days;

(ii) the discontinuation of development of its clinical drug candidate;

(iii) the unethical or illegal business practices of the other party;

or (iv) if the parties have not agreed on the protocol or budget within ninety days of the effective date of the agreement.

In addition, the Company may terminate the agreement upon the inappropriate or unsafe use of the RP1 product candidate.

As of March 31, 2024, we and Incyte had not yet agreed on the protocol or budget.

However, we and Incyte continue to discuss a potential protocol and neither party has triggered termination of the agreement in accordance with the termination right described in clause (iv) above.

The parties are evaluating potential collaboration efforts pending further CERPASS data readout of RP1 in combination with cemiplimab and additional data for Incyte's product candidate INCB99280.

Critical accounting policies and estimates

Our management’s discussion and analysis of financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United

The preparation of our consolidated financial statements and related disclosures requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, costs and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements.

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Stock-based compensation

We issue stock-based awards to employees, directors, consultants and non-employees in the form of stock options, restricted stock units, and performance-based restricted stock units, or PSUs.

We measure such stock-based awards in accordance with ASC 718, Compensation — Stock Compensation , which requires all stock-based awards to be recognized in the consolidated statements of operations and comprehensive loss based on their fair value on the date of the grant and the related compensation expense for those awards is recognized over the requisite service period, which is generally the vesting period of the respective award.

We issue stock-based awards to employees, directors, consultants and non-employees in the form of stock options, restricted stock units, or RSUs, and performance-based restricted stock units, or PSUs.

the respective award.

We have, to date, issued stock-based awards with service-based and performance-based vesting conditions.

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The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model, which requires inputs based on certain subjective assumptions, including the expected stock price volatility, the expected term of the option, the risk-free interest rate for a period that approximates the expected term of the option, and our expected dividend yield.

See Note 10 of the "Notes to Consolidated Financial Statements" contained in Part II, Item 8 of this Annual Report on Form 10-K

for more information.

See Note 10 of the "Notes to Consolidated Financial Statements" contained in Part II, Item 8 of this Annual Report on Form 10-K for more information.

Forfeitures are accounted for as they occur.

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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 7. Management’s Discussion and Analysis