What changed in this filing

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Item 1. Financial Statements

2024-11-07 compared with 2024-08-06 · 203 added, 166 removed, 435 unchanged (46% of the section changed)

3 unchanged sentences

(In thousands)

June 30, 2024

September 30, 2024

December 31, 2023 (1)

28 unchanged sentences

Additional paid-in capital (2)

Accumulated other comprehensive (loss) income

Accumulated other comprehensive income

Accumulated deficit

9 unchanged sentences

(In thousands, except per share amounts)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Product sales, net

10 unchanged sentences

Interest expense

Net loss per share, basic and diluted (1)

Weighted average shares used in computing net loss per share, basic and diluted (1)

Net income (loss)

Net income (loss) per share (1)

Weighted average shares used in computing net income (loss) per share (1)

(1) Share and per share amounts have been restated to reflect the 1-for-10 reverse stock split effected on June 27, 2024 on a retroactive basis for all periods presented.

1 unchanged sentence

RIGEL PHARMACEUTICALS, INC.

CONDENSED STATEMENTS OF COMPREHENSIVE LOSS

CONDENSED STATEMENTS OF COMPREHENSIVE INCOME ( LOSS)

(In thousands)

Three Months Ended June 30,

Six Months Ended June 30,

Other comprehensive (loss) gain:

Net unrealized (loss) gain on short-term investments

Comprehensive loss

Three Months Ended September 30,

Nine Months Ended September 30,

Net income (loss)

Other comprehensive income:

Net unrealized gain on short-term investments

Comprehensive income (loss)

See Accompanying Notes to Condensed Financial Statements

21 unchanged sentences

( 1,416,827 )

Net change in unrealized gain on short-term investments

Issuance of common stock upon exercise of options

Issuance of common stock upon vesting of RSUs

Stock-based compensation expense

Balance as of September 30, 2024

( 1,404,406 )

Accumulated Other

16 unchanged sentences

( 1,402,595 )

Net change in unrealized gain on short-term investments

Issuance of common stock upon exercise of options

Stock-based compensation expense

Balance as of September 30, 2023

( 1,408,287 )

(1) All share amounts in this column, including appropriate reclassifications between common stock and additional paid-in capital, have been restated to reflect the 1-for-10 reverse stock split effected on June 27, 2024 on a retroactive basis for all periods presented.

3 unchanged sentences

(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Operating activities

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

Net income (loss)

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

Stock-based compensation expense

Loss on sale and disposal of fixed assets

(Gain) loss on sale and disposal of fixed assets

Depreciation and amortization

12 unchanged sentences

Other current and long-term liabilities

Net cash (used in) provided by operating activities

Net cash provided by operating activities

Investing activities

1 unchanged sentence

Purchases of short-term investments

Capital expenditures

Payments for acquisition of intangible assets

4 unchanged sentences

Net proceeds from issuances of common stock upon exercise of options

Closing purchase price payment related to asset acquisition

Cost share payments to a collaboration partner

5 unchanged sentences

Interest paid

Intangible assets included within acquisition-related liabilities

Acquisition-related liabilities

See Accompanying Notes to Condensed Financial Statements

17 unchanged sentences

We acquired the rights to research, develop, manufacture and commercialize GAVRETO in the US from Blueprint Medicines Corporation (Blueprint) pursuant to an Asset Purchase Agreement entered in February 2024.

We continue to advance the development of R289, our interleukin receptor-associated kinases 1 and 4 (IRAK 1/4) inhibitor program, in an open-label, Phase 1b trial to determine the tolerability and preliminary efficacy of the drug in patients with lower-risk myelodysplastic syndrome (MDS) who are relapsed, refractory or resistant to prior therapies.

We have strategic development collaborations with the University of Texas MD Anderson Cancer Center (MDACC) to expand our evaluation of REZLIDHIA in AML and other hematologic cancers with IDH1 mutations, and with Collaborative Network for Neuro-Oncology Clinical Trials (CONNECT) to conduct a Phase 2 clinical trial to evaluate REZLIDHIA in combination with temozolomide in patients with high-grade glioma (HGG) harboring an IDH1 mutation.

We continue to advance the development of R289, our dual interleukin receptor-associated kinases 1 and 4 (IRAK 1/4) inhibitor program, in an open-label, Phase 1b study to determine the tolerability and preliminary efficacy of the drug in patients with lower-risk myelodysplastic syndrome (MDS) who are relapsed, refractory or resistant to prior therapies.

We have strategic development collaborations with the University of Texas MD Anderson Cancer Center (MDACC) to expand our evaluation of olutasidenib in AML and other hematologic cancers with IDH1 mutations, and with Collaborative Network for Neuro-Oncology Clinical Trials (CONNECT) to conduct a Phase 2 clinical trial to evaluate olutasidenib in combination with temozolomide in patients with high-grade glioma (HGG) harboring an IDH1 mutation.

We have a receptor-interacting serine/threonine-protein kinase 1 (RIPK1) inhibitor program in clinical development with our partner Eli Lilly and Company (Lilly).

3 unchanged sentences

As a result of the reverse stock split, every ten issued and outstanding shares of our common stock were automatically combined into one issued and outstanding share of common stock.

Accordingly, an amount equal to the par value of the decreased shares

resulting from the reverse stock split was reclassified from common stock to additional paid-in capital on the condensed balance sheet and statement of changes in stockholders’ deficit.

Accordingly, an amount equal to the par value of the decreased shares resulting from the reverse stock split was reclassified from common stock to additional paid-in capital on the condensed balance sheet and statement of changes in stockholders’ deficit.

No fractional shares were issued in connection with the reverse stock split.

17 unchanged sentences

There have been no material changes to these accounting policies except for the accounting consideration related to the Asset Purchase Agreement with Blueprint as discussed below in “Note 5 – In-licensing and Acquisition.”

As of June 30, 2024, we had approximately $ 49.1 million in cash, cash equivalents and short-term investments.

Since inception, we have financed our operations primarily through sales of equity securities, debt financing, contract payments under our collaboration agreements and from product sales.

As of September 30, 2024, we had approximately $ 61.1 million in cash, cash equivalents and short-term investments.

We finance our operations primarily through sales of our products, and contract payments under our collaboration agreements, as well as through equity securities and debt financing.

Based on our current operating plan, we believe that our existing cash, cash equivalents, and short-term investments will be sufficient to fund our expenses and capital expenditure requirements for at least the next 12 months from the date of issuance of this Form 10-Q.

4 unchanged sentences

an amount and description of its composition for other segment items;

interim disclosures of a reportable segment’s profit or loss and assets.

and interim disclosures of a reportable segment’s profit or loss and assets.

All disclosure requirements under this update are also required for public entities with a single reportable segment.

6 unchanged sentences

Early adoption is permitted.

We are currently assessing the impact of adopting this guidance but does not expect to have a significant impact to our financial statements and disclosures.

We are currently assessing the impact of adopting this guidance but do not expect it to have a significant impact to our financial statements and disclosures.

Other recently issued accounting guidance not discussed in this Quarterly Report on Form 10-Q are either not applicable or did not have, or are not expected to have, a material impact on us.

Net Loss Per Share

Basic net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during the period.

Diluted net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during the period and the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued.

Net Income (Loss) Per Share

Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period.

Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period and the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued.

Potentially dilutive securities include stock options, RSUs and shares issuable under our Employee Stock Purchase Plan (Purchase Plan).

1 unchanged sentence

Under the treasury stock method, an increase in the fair market value of our common stock can result in a greater dilutive effect from potentially dilutive securities.

The potential shares of common stock that were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive are as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Outstanding stock options

The following table sets forth the computation of basic and diluted earnings per share (in thousands except per share amounts):

Three Months Ended September 30,

Nine Months Ended September 30,

EPS Numerator:

Net income (loss)

EPS Denominator—Basic:

Weighted-average common shares outstanding

EPS Denominator—Diluted:

Weighted-average common shares outstanding

Dilutive effect of stock options, RSUs and shares under Purchase Plan

Weighted-average shares outstanding and common stock equivalents

Net income (loss) per share

The potential shares of common stock that were excluded from the computation of diluted net income (loss) per share for the periods presented because including them would have been antidilutive are as follows (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Stock options

Shares under Purchase Plan

Revenues disaggregated by category were as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Product sales:

3 unchanged sentences

Revenues from collaborations:

License revenue

Milestone revenue

Delivery of drug supplies, royalty and others

2 unchanged sentences

Total revenues

Revenue from product sales are related to sales of our commercial products to our specialty distributors.

Revenue from product sales are related to sales of our commercial products to our customers.

For detailed discussions of our revenues from collaborations and government contracts, see “Note 4 – Sponsored Research, License Agreements and Government Contracts.”

Our net product sales include gross product sales, net of chargebacks, discounts and fees, government and other rebates and returns.

Of the total discounts and allowances from gross product sales for the six months ended June 30, 2024 and 2023, $ 27.6 million and $ 18.6 million, respectively, was accounted for as additions to revenue reserves and refund liability, and $ 0.4 million and $ 0.4 million, respectively, as reductions in accounts receivable (as it relates to allowance for prompt pay discount) and prepaid and other current assets (as it relates to certain chargebacks and other fees that were prepaid) in the condensed balance sheet.

Of the total discounts and allowances from gross product sales for the nine months ended September 30, 2024 and 2023, $ 44.6 million and $ 29.7 million, respectively, was accounted for as additions to revenue reserves and refund liability, and $ 0.7 million and $ 0.8 million, respectively, as reductions in accounts receivable (as it relates to allowance for prompt pay discount) and prepaid and other current assets (as it relates to certain chargebacks and other fees that were prepaid) in the condensed balance sheet.

The following tables summarize the activities in chargebacks, discounts and fees, government and other rebates and returns that were accounted for within revenue reserves and refund liability, for each of the periods presented (in thousands):

3 unchanged sentences

Credit or payments made during the period

Balance as of June 30, 2024

Balance as of September 30, 2024

Discounts and

2 unchanged sentences

Credit or payments made during the period

Balance as of June 30, 2023

Balance as of September 30, 2023

The following table summarizes the percentages of revenues from each of our customers who individually accounted for 10% or more of the total net product sales and revenues from collaborations:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

McKesson Corporation

Cardinal Health, Inc.

(formerly ASD Healthcare)

Cardinal Health, Inc.

* Denotes less than 10%

Sponsored Research, License Agreements and Government Contracts

1 unchanged sentence

We conduct research and development programs independently and in connection with our corporate collaborators.

As of June 30, 2024, we are a party to collaboration agreements with Lilly to develop and commercialize ocadusertib (previously R552), a RIPK1 inhibitor, for the treatment of non-central nervous system (non-CNS) diseases and collaboration aimed at developing additional RIPK1 inhibitors for the treatment of central nervous system (CNS) diseases;

As of September 30, 2024, we are a party to collaboration agreements with Lilly to develop and commercialize ocadusertib (previously R552), a RIPK1 inhibitor, for the treatment of non-central nervous system (non-CNS) diseases and collaboration aimed at developing additional RIPK1 inhibitors for the treatment of central nervous system (CNS) diseases;

with Grifols S.A.

1 unchanged sentence

with Kissei Pharmaceutical Co., Ltd.

(Kissei) to develop and commercialize fostamatinib in Kissei territory which includes Japan, China, Taiwan and the Republic of Korea;

(Kissei) to develop and commercialize fostamatinib in Japan, China, Taiwan and the Republic of Korea (Korea), and olutasidenib in Japan, Korea and Taiwan;

with Medison Pharma Trading AG (Medison Canada) and Medison Pharma Ltd.

(Medison Israel and, together with Medison Canada, Medison) to commercialize fostamatinib in all indications, in Medison territory which includes Canada and Israel;

and with Knight Therapeutics International SA (Knight) to commercialize fostamatinib in all indications, in Knight territory which includes Latin America, consisting of Mexico, Central and South America, and the Caribbean (Knight territory).

Further, we are also a party to collaboration agreements, but do not have ongoing performance obligations with BerGenBio for the development and commercialization of AXL receptor tyrosine kinase ( AXL) inhibitors in oncology, and with Daiichi to pursue research related to murine double minute 2 ( MDM2) inhibitors, a novel class of drug targets called ligases.

Under the above existing agreements that we entered into in the ordinary course of business, we received or may be entitled to receive upfront cash payments, payments contingent upon specified events achieved by such partners and royalties on any net sales of products sold by such partners under the agreements.

As of June 30, 2024, total future contingent payments to us under all of the above existing agreements, excluding terminated agreements, could exceed $ 1.3 billion if all potential product candidates achieved all of the payment triggering events under all of our current agreements.

As of September 30, 2024, total future contingent payments to us under all of the above existing agreements, excluding terminated agreements, could exceed $ 1.4 billion if all potential product candidates achieved all of the payment triggering events under all of our current agreements.

Of this amount, $ 279.5 million relates to the achievement of development events, $ 306.1 million relates to the achievement of regulatory events and $ 873.5 million relates to the achievement of certain commercial events.

21 unchanged sentences

Pursuant to the terms of the Lilly Agreement, we have the right to opt-out of co-funding the ocadusertib development activities in the US, Europe and Japan at two different specified times and as a result receive lesser royalties from sales.

Prior to us providing our first opt-out notice as discussed below, under the Lilly Agreement, we were required to fund our share of the ocadusertib development activities up to a maximum funding

commitment of $ 65.0 million through April 1, 2024.

Prior to us providing our first opt-out notice as discussed below, under the Lilly Agreement, we were required to fund our share of the ocadusertib development activities up to a maximum funding commitment of $ 65.0 million through April 1, 2024.

We accounted for this agreement under ASC 606 and identified the following distinct performance obligations at inception of the agreement:

6 unchanged sentences

Interest expense was accreted on such liability over the expected commitment period, adjusted for timing of expected cost share payments.

No interest was accreted during the three and six months ended June 30, 2024 and 2023.

No interest was accreted during the three and nine months ended September 30, 2024 and 2023.

At the inception, we allocated the net transaction price of $ 67.1 million to each performance obligation based on our best estimate of its relative standalone selling price using the adjusted market assessment approach.

1 unchanged sentence

The transaction price allocated to the CNS penetrant IP of $ 6.7 million was recognized as revenue from the effective date of the Lilly Agreement through the eventual acceptance by Lilly in June 2022 using the input method.

There was no outstanding deferred revenue related to Lilly Agreement as of June 30, 2024 and December 31, 2023.

There was no outstanding deferred revenue related to Lilly Agreement as of September 30, 2024 and December 31, 2023.

On September 28, 2023, we entered into an amendment to the Lilly Agreement which provides, among others that if we exercise our first opt-out right, we have the right to opt-in to the co-funding of ocadusertib development, upon us providing notice to Lilly within 30 days of certain events as specified in the Lilly Agreement, and as a result receive greater royalties from sales.

1 unchanged sentence

If we exercise our opt-in right, we will be required to continue to share in global development costs, and if we later exercise our second opt-out right (no later than April 1, 2025), our share in global development costs will be up to a specified cap through December 31, 2025, as provided for in the Lilly Agreement.

Lilly billed us $ 21.4 million for our share of development costs incurred through April 1, 2024, and the amount was fully paid as of June 30, 2024.

The outstanding liability to Lilly reported within other long-term liabilities (current and non-current) in the condensed balance sheet as of June 30, 2024 and December 31, 2023 amounted to $ 40.0 million and $ 43.6 million, respectively.

Lilly billed us $ 21.4 million for our share of development costs incurred through April 1, 2024, and the amount was fully paid as of September 30, 2024.

The outstanding liability to Lilly reported within other long-term liabilities (current and non-current) in the condensed balance sheets as of September 30, 2024 and December 31, 2023 amounted to $ 40.0 million and $ 43.6 million, respectively.

As discussed above, following the amendment to the Lilly Agreement, and us providing the first opt-out notice to Lilly, our cost share obligation for ocadusertib development ended on April 1, 2024.

Although currently we are no longer obligated to pay Lilly for our share in the ocadusertib development cost incurred subsequent to April 1, 2024, the outstanding liability reported in our condensed balance sheet as of June 30, 2024 amounting to $ 40.0 million has not been recognized as revenue because we cannot conclude that it is probable that a significant reversal of the amount of revenue, if recognized, will not occur until the likelihood of us exercising our opt-in right becomes remote, or when the opt-in right period lapses.

Although currently we are no longer obligated to pay Lilly for our share in the ocadusertib development cost incurred subsequent to April 1, 2024, the outstanding liability reported in our condensed balance sheet as of September 30, 2024 amounting to $ 40.0 million has not been recognized as revenue because we cannot conclude that it is probable that a significant reversal of the amount of revenue, if recognized, will not occur until the likelihood of us exercising our opt-in right becomes remote, or when the opt-in right period lapses.

Grifols License Agreement

3 unchanged sentences

In January 2020, the European Commission (EC) granted a centralized Marketing Authorization (MA) for fostamatinib valid throughout the European Union (EU) and in the UK after the departure of the UK from the EU for the treatment of chronic ITP in adult patients who are refractory to other treatments.

Agency (EMA) of fostamatinib for the first indication and a $ 2.5 million creditable advance royalty payment, based on the terms of our collaboration agreement with Grifols.

The above milestone payment was allocated to the distinct performance obligations in the collaboration agreement with Grifols.

We accounted for this agreement under ASC 606 and identified distinct performance obligations at inception of the agreement.

We allocated the transaction price to the distinct performance obligations in our collaboration agreement based on our best estimate of the relative standalone selling price, and recognized the corresponding revenue in the periods we satisfied the performance obligations.

There was no outstanding deferred revenue related to the Grifols license agreement as of June 30, 2024 and December 31, 2023.

We entered into a Commercial Supply Agreement with Grifols in October 2020 to supply and sell our drug product priced at a certain markup specified in the agreement, in quantities Grifols order from us pursuant to and in accordance with the agreement.

Prior to the Commercial Supply Agreement, we had a Drug Product Purchase Agreement with Grifols entered in December 2019.

There was no revenue recognized related to the delivery of drug supply to Grifols for the three and six months ended June 30, 2024.

For the three and six month ended June 30, 2023, we recognized revenue of $ 1.2 million and $ 2.8 million, respectively, from the delivery of drug supply to Grifols.

We recognize royalty revenue from Grifols included within contract revenues from collaboration.

Royalty revenue recognized for the three months ended June 30, 2024 and 2023 was $ 1.1 million and $ 0.8 million, respectively, and for the six months ended June 30, 2024 and 2023 was $ 2.2 million and $ 1.5 million, respectively.

Kissei License Agreement

We have an exclusive license and supply agreement with Kissei entered in October 2018, to develop and commercialize fostamatinib in all current and potential indications in Kissei’s territory.

With this approval, in February 2020, we received $ 20.0 million non-refundable payment, composed of a $ 17.5 million payment due upon Marketing Authorization Application (MAA) approval by the European Medicines Agency (EMA) of fostamatinib for the first indication and a $ 2.5 million creditable advance royalty payment, based on the terms of our collaboration agreement with Grifols.

We accounted for this agreement under ASC 606, and recognized the corresponding revenue in the period we satisfied the performance obligations.

There was no outstanding deferred revenue related to the Grifols license agreement as of September 30, 2024 and December 31, 2023.

We have a commercial supply agreement with Grifols entered in October 2020 to supply and sell our drug product priced at a certain markup specified in the agreement, in quantities Grifols order from us pursuant to and in accordance with the agreement.

For the three and nine months ended September 30, 2024, we recognized $ 2.0 million of revenue related to the delivery of drug supply to Grifols.

No revenue and $ 2.8 million of revenue was recognized for the three and nine months ended September 30, 2023, respectively, related to the delivery of drug supply to Grifols.

We recognized royalty revenue from Grifols of $ 1.3 million and $ 3.5 million for the three and nine months ended September 30, 2024, respectively, and $ 0.8 million and $ 2.3 million for the three and nine months ended September 30, 2023, respectively.

Kissei License Agreement – Olutasidenib

On September 3, 2024, we entered into a collaboration and license agreement with Kissei, pursuant to which Kissei was granted exclusive rights to develop and commercialize olutasidenib in all human diseases in Japan, Korea and Taiwan.

Kissei is responsible for performing and funding the development activities for olutasidenib in the Kissei territory and we retained the co-exclusive right to conduct development activities in the Kissei territory solely for the purpose of supporting and obtaining regulatory approval of and commercializing olutasidenib in the world outside the Kissei territory.

Under the terms of the agreement, we received a one-time, non-refundable, and non-creditable upfront cash payment of $ 10.0 million, with the potential for up to an additional $ 152.5 million in development, regulatory and commercial milestone payments, and will receive mid twenty to lower thirty percent, tiered, escalated net sales-based

payments for the supply of olutasidenib, subject to certain standard reductions and offsets .

Pursuant to the agreement, Kissei is responsible for companion diagnostic development in Japan, for which we will share 50 % of the costs incurred by Kissei, up to $ 3.0 million, which are creditable against future milestones and transfer price payments owed to us .

We remain responsible for the manufacture and supply of olutasidenib for all development and commercialization activities under the agreement.

Pursuant to the concurrently executed supply agreement, we will supply Kissei with bulk drug product for use under the collaboration and license agreement.

We accounted for this agreement following ASC 606 and concluded at the inception of the agreement, the upfront cash payment of $ 10.0 million was the consideration for granting the license right to Kissei, and there are no other material deliverables associated with the upfront payment.

Accordingly, we recognized the upfront payment as revenue during the three and nine months ended September 30, 2024.

The variable considerations related to future development, regulatory and commercial milestones were fully constrained because it was probable that a significant reversal of cumulative revenue would occur, given the inherent uncertainty of success with these future milestones.

We will re-evaluate the transaction price in each reporting period as uncertain events are resolved or other changes in circumstances occur.

We will recognize revenues related to the supply of olutasidenib upon delivery and when we are entitled to receive the product transfer price payments.

Under the license and services agreement with Forma as discussed in “Note 5, In-licensing and Acquisition”, Forma is entitled to a certain portion of sublicensing revenue, which include, but are not limited to, upfront payments, milestone payments and royalties, that we receive from a third party sublicensee.

Following the collaboration and license agreement with Kissei as discussed above, Forma is entitled to a portion of the sublicensing revenue we receive from Kissei.

With the receipt of the upfront payment from Kissei, we recognized a $ 2.3 million sublicense revenue fee payable to Forma for the three and nine months ended September 30, 2024, which we recorded within cost of product sales.

The amount was outstanding and recorded within other accrued liabilities in the condensed balance sheet as of September 30, 2024.

Kissei License Agreement – Fostamatinib

We have an exclusive license and supply agreement with Kissei entered in October 2018, amended in November 2022, October 2023, August 2024, and September 2024, to develop and commercialize fostamatinib in all current and potential indications in Japan, China, Taiwan and Korea.

Kissei is responsible for performing and funding all development activities for fostamatinib in the above-mentioned territories.

We received an upfront cash payment of $ 33.0 million, with the potential for up to an additional $ 147.0 million in development, regulatory and commercial milestone payments, and will receive mid- to upper twenty percent, tiered, escalated net sales-based payments for the supply of fostamatinib.

At the inception of the agreement, we received an upfront cash payment of $ 33.0 million.

Further, the agreement provides for up to $ 115.0 million in potential development, regulatory and commercial milestone payments, and mid- to upper twenty percent, tiered, escalated net sales-based payments for the supply of fostamatinib.

Under the agreement, we granted Kissei the license rights to fostamatinib in Kissei’s territory and are obligated to supply Kissei with drug product for use in clinical trials and pre-commercialization activities.

We are also responsible for the manufacture and supply of fostamatinib for all future development and commercialization activities under the agreement.

We accounted for this agreement under ASC 606 and identified the distinct performance obligations at inception of the agreement.

We concluded that each of these performance obligations is distinct.

We determined that the upfront fee represented the transaction price and was allocated to the performance obligations based on our best estimate of the relative standalone selling price and recognized the corresponding revenue in the period we satisfied the performance obligations.

As of June 30, 2024 and December 31, 2023, the remaining deferred revenue was related to the material right associated with discounted fostamatinib supply which amounted to $ 1.4 million .

No revenue was recognized during the three and six months ended June 30, 2024 and 2023 associated with the remaining performance obligation.

In April 2022, Kissei announced that an NDA was submitted to Japan’s Pharmaceuticals and Medical Devices Agency (PMDA) for fostamatinib in chronic ITP.

With this milestone event, we received $ 5.0 million non-refundable and non-creditable payment from Kissei pursuant to the terms of our collaboration agreement, and such amount was recognized as revenue in the second quarter of 2022.

In December 2022, Kissei announced that Japan’s PMDA approved the NDA for fostamatinib in chronic ITP.

With this milestone event, we were entitled to receive $ 20.0 million non-refundable and non-creditable payment from Kissei pursuant to the terms of our collaboration agreement, which we recognized as revenue in the fourth quarter of 2022 .

The amount was subsequently collected in January 2023.

For the three and six months ended June 30, 2024, we recognized $ 2.2 million and $ 4.5 million, respectively, of revenue related to the delivery of drug supply to Kissei mainly for commercial use.

No such revenue was recognized during the three and six months ended June 30, 2023.

We are also responsible for the manufacture and supply of fostamatinib for all future development and commercialization activities.

In April 2022, Kissei announced that an NDA was submitted to Japan’s Pharmaceuticals and Medical Devices Agency (PMDA) for fostamatinib in chronic ITP which entitled us to receive a $ 5.0 million non-refundable and non-creditable milestone payment.

In December 2022, Kissei announced that Japan’s PMDA approved the NDA for fostamatinib in chronic ITP, which entitled us to receive a $ 20.0 million non-refundable and non-creditable milestone payment.

We accounted for this agreement under ASC 606, and recognized the corresponding revenue in the period we satisfied the performance obligations.

As of September 30, 2024 and December 31, 2023, the remaining deferred revenue was related to the material right associated with discounted fostamatinib supply which amounted to $ 1.4 million .

No revenue was recognized during the three and nine months ended September 30, 2024 and 2023 associated with the remaining performance obligation.

For the three and nine months ended September 30, 2024, we recognized revenue from Kissei of $ 3.0 million and $ 7.5 million, respectively, related to the delivery of fosmatinib drug supply for commercial use.

No such revenue was recognized during the three and nine months ended September 30, 2023.

Medison Commercial and License Agreements

We have two exclusive commercial and license agreements with Medison entered in October 2019 for the commercialization of fostamatinib for chronic ITP in Medison territory, pursuant to which, we received a $ 5.0 million upfront payment with respect to the agreement in Canada.

We have exclusive commercial and license agreements with Medison entered in October 2019 for the commercialization of fostamatinib for chronic ITP in Medison territory, pursuant to which, we received a $ 5.0 million upfront payment with respect to the agreement in Canada.

We accounted for this agreement under ASC 606 and identified the following combined performance obligations at inception of the agreement:

4 unchanged sentences

As such, in accordance with ASC 606, we relieved the outstanding financing liability which included the upfront payment and accreted interest, and recognized such amount as revenue in 2022.

There was no outstanding deferred revenue related to Medison license agreement as of June 30, 2024 and December 31, 2023.

For the three and six months ended June 30, 2024, we recognized revenue from Medison of $ 0.1 million and $ 0.2 million, respectively, related to the delivery of drug supply and earned royalties.

There was no material revenue recognized in the three and six months ended June 30, 2023 related to the delivery of drug supply and earned royalties.

There was no outstanding deferred revenue related to Medison commercial and license agreement as of September 30, 2024 and December 31, 2023.

For the three and nine months ended September 30, 2024, we recognized revenue from Medison of $ 0.1 million and $ 0.2 million, respectively, related to the delivery of drug supply and earned royalties.

For the three and nine months ended September 30, 2023, we recognized $ 0.2 million of revenue related to the delivery of drug supplies and a milestone pursuant to the commercial and license agreement .

Knight Commercial License and Supply Agreement

6 unchanged sentences

US Department of Defense (DOD)

Government contract revenue for the three and six months ended June 30, 2023 of $ 1.0 million was from an award we received from DOD to support our Phase 3 clinical trial to evaluate the safety and efficacy of fostamatinib for the treatment of hospitalized high-risk patients with COVID-19.

No revenue was recognized during the three and six months ended June 30, 2024 from this grant.

Government contract revenue for the nine months ended September 30, 2023 of $ 1.0 million was from an award we received from DOD to support our Phase 3 clinical trial to evaluate the safety and efficacy of fostamatinib for the treatment of hospitalized high-risk patients with COVID-19.

No revenue was recognized during the three and nine months ended September 30, 2024 and during the three months ended September 30, 2023 from this grant.

Biomedical Advanced Research and Development (BARDA)

In August 2023, we were awarded up to $ 0.8 million by BARDA, part of the Office of the Assistant Secretary for the Preparedness and Response at the US Department of Health and Human Services (DHHS), for our evaluation of fostamatinib in mitigating the impact of long-term respiratory distress.

No revenue was recognized during the three and six months ended June 30, 2024 from this grant.

Through June 30, 2024, we have received $ 0.1 million of the award.

No revenue was recognized during the three and nine months ended September 30, 2024 and 2023 from this grant.

Through September 30, 2024, we have received $ 0.1 million of the award.

Strategic Development Collaborations with MDACC and CONNECT

In December 2023, we entered into a Strategic Collaboration Agreement with MDACC, a comprehensive cancer research, treatment, and prevention center.

The collaboration will expand our evaluation of REZLIDHIA (olutasidenib) in AML and other hematologic cancers.

Under the collaboration, we will provide MDACC the study materials and $ 15.0 million in time-based milestone payments as compensation for services to be provided for the

studies, over the five-year collaboration term, unless terminated earlier as provided for in the agreement.

Through June 30, 2024, we provided $ 2.0 million funding to MDACC.

In January 2024, we announced our collaboration with CONNECT, an international collaborative network of pediatric cancer centers, to conduct a Phase 2 clinical trial to evaluate REZLIDHIA in glioma.

The collaboration will expand our evaluation of olutasidenib in AML and other hematologic cancers.

Under the collaboration, we will provide MDACC the study materials and $ 15.0 million in time-based milestone payments as compensation for services to be provided for the studies, over the five-year collaboration term, unless terminated earlier as provided for in the agreement.

Through September 30, 2024, we provided $ 2.0 million funding to MDACC.

In January 2024, we announced our collaboration with CONNECT, an international collaborative network of pediatric cancer centers, to conduct a Phase 2 clinical trial to evaluate olutasidenib in glioma.

Under the collaboration, we will provide funding up to $ 3.0 million and study material over the four-year collaboration.

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Total purchase consideration

The closing purchase price was recorded within acquisition-related liabilities in the condensed balance sheet and was outstanding as of June 30, 2024, of which, $ 10.0 million was paid in July 2024 following our first commercial sale of GAVRETO at the end of June 2024.

The transaction costs have been paid in cash as of June 30, 2024.

$ 10.0 million of the closing purchase price was paid in July 2024, and the remaining $ 5.0 million is outstanding and presented as acquisition-related liabilities in the condensed balance sheet as of September 30, 2024.

In accordance with the guidance, we classified the payment of the closing purchase price under financing activity in the condensed statements of cash flows, considering that the payment was not made soon after the acquisition date.

The transaction

costs have been paid in cash as of September 30, 2024.

The contingent considerations relating to future commercial and regulatory milestones were not included in the total purchase price consideration, and will be accounted for when the contingency is resolved and the consideration becomes payable.

Royalties will be recognized within cost of sales, as revenue from GAVRETO product sales is recognized.

Royalties are recognized within cost of product sales, as revenue from GAVRETO product sales is recognized.

In an asset acquisition, the acquiring entity should recognize the assets acquired at cost to the acquiring entity which includes transaction costs and consideration given, allocated based on a relative fair value of the assets acquired measured at acquisition date.

The fair value of the developed technology, customers, trademarks and trade name was

estimated using a multi-period excess earnings income approach that discounts expected cash flows to present value by applying discount rate that represents the estimated rate that market participants would use to value such assets.

The fair value of the developed technology, customers, trademarks and trade name was estimated using a multi-period excess earnings income approach that discounts expected cash flows to present value by applying discount rate that represents the estimated rate that market participants would use to value such assets.

The relative fair value are based on estimates that required judgement and certain assumptions, categorized as Level 3 in the fair value hierarchy.

Since we acquired a single asset, the total purchase consideration was recorded as intangible assets.

The related intangible assets is being amortized on a straight-line basis over the estimated useful life of 12 years , and the related amortization is recorded within cost of sales.

The related intangible assets is being amortized on a straight-line basis over the estimated useful life of 12 years , and the related amortization is recorded within cost of product sales.

Simultaneously and in connection with entering into the Asset Purchase Agreement, we also entered into certain supporting agreements, including a customary transition agreement, pursuant to which, during the transition period, Blueprint will transition regulatory and distribution responsibility for GAVRETO to us.

We also agreed to purchase certain drug product inventories from Blueprint under a Material Transfer Agreement, and received such inventories amounting to approximately $ 6.5 million during the six months ended June 30, 2024.

License and Transition Services Agreement with Forma

We have a license and transition services agreement with Forma entered in July 2022, for an exclusive license to develop, manufacture and commercialize olutasidenib, a proprietary inhibitor of mutated IDH1 (mIDH1), for any uses worldwide, including for the treatment of AML and other malignancies.

Forma became a wholly owned subsidiary of Novo Nordisk following the closing of its acquisition by Novo Nordisk in October 2022.

Pursuant to the terms of the license and transition services agreement, we paid an upfront fee of $ 2.0 million, with the potential to pay up to $ 67.5 million of additional payments upon achievement of specified development and regulatory milestones and up to $ 165.5 million of additional payments upon achievement of certain commercial milestones.

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The transaction was accounted for as an acquisition of asset under ASC 730, Research and Development .

In accordance with the guidance, in a transaction accounted for as an asset acquisition, any acquired IPR&D that does not have alternative future use is charged to expense at the acquisition date.

In accordance with the guidance, in a transaction accounted for as an asset acquisition, any acquired in-process research and development (IPR&D) that does not have alternative future use is charged to expense at the acquisition date.

At the acquisition date, the acquired license asset was accounted for as IPR&D, and we anticipated no other economic benefit to be derived from such acquired licensed asset other than the primary indications.

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With this FDA approval and first commercial sale of the product, Forma was entitled to receive a total of $ 15.0 million milestone payments.

Since such milestone payment obligations were incurred upon and after regulatory approval of the product, we recorded such amount as intangible assets on our condensed balance sheet in the fourth quarter of 2022.

No new milestone was met in 2023 and during the six months ended June 30, 2024.

The amount recorded as intangible asset is being amortized on a straight-line basis over the estimated useful life of 14 years , and the related amortization is recorded within cost of sales .

Royalties are recognized within cost of sales, as revenue from REZLIDHIA product sales is recognized.

Since such milestone payment obligations were incurred upon and after regulatory approval of the

product, we recorded such amount as intangible assets on our condensed balance sheet in the fourth quarter of 2022.

No new milestone was met in 2023 and during the nine months ended September 30, 2024.

The amount recorded as intangible asset is being amortized on a straight-line basis over the estimated useful life of 14 years , and the related amortization is recorded within cost of product sales .

Royalties are recognized within cost of product sales, as revenue from REZLIDHIA product sales is recognized.

Stock-Based Compensation

Stock-based compensation for the periods presented was as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Selling, general and administrative

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Total stock-based compensation expense

During the six months ended June 30, 2024, we granted stock options to purchase 599,772 shares of common stock with weighted-average grant-date fair value of $ 9.64 per share, and 9,294 stock options were exercised.

The stock options granted during the six months ended June 30, 2024 generally vest over 3 years .

As of June 30, 2024, there were 3,691,139 stock options outstanding, of which, 132,250 are outstanding performance-based stock options wherein the achievement of the corresponding corporate-based milestones were assessed not probable as of June 30, 2024.

Accordingly, none of the $ 2.5 million grant date fair value for these awards has been recognized as stock-based compensation expense as of June 30, 2024.

During the nine months ended September 30, 2024, we granted stock options to purchase 679,662 shares of common stock with weighted-average grant-date fair value of $ 9.36 per share, and 25,657 stock options were exercised.

The stock options granted during the nine months ended September 30, 2024 generally vest over 3 years .

As of September 30, 2024, there were 3,650,540 stock options outstanding, of which, 132,250 are outstanding performance-based stock options wherein the achievement of the corresponding corporate-based milestones were assessed not probable as of September 30, 2024.

Accordingly, none of the $ 2.5 million grant date fair value for these awards has been recognized as stock-based compensation expense as of September 30, 2024.

The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model.

The following table summarizes the weighted-average assumptions relating to options granted pursuant to our Equity Incentive Plans (our 2018 Equity Incentive Plan and Inducement Plan, as amended) for the periods presented:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Risk-free interest rate

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Expected volatility

During the six months ended June 30, 2024, we granted 291,373 RSUs with a grant-date weighted-average fair value of $ 12.52 per share, and 66,408 RSUs were released.

The RSUs granted during the six months ended June 30, 2024 generally vest over 3 years .

As of June 30, 2024, there were 387,729 RSUs outstanding.

As of June 30, 2024, there was approximately $ 14.0 million of unrecognized stock-based compensation cost which is expected to be recognized over a remaining weighted-average period of 2.15 years, related to time-based stock options, performance-based stock options wherein achievement of the corresponding corporate-based milestones was considered as probable, and RSUs.

In March 2024 and April 2024, our Board of Directors approved additional 78,232 shares of common stock reserved for issuance under our Inducement Plan.

During the nine months ended September 30, 2024, we granted 291,373 RSUs with a grant-date weighted-average fair value of $ 12.52 per share, and 68,908 RSUs were released.

The RSUs granted during the nine months ended September 30, 2024 generally vest over 3 years .

As of September 30, 2024, there were 375,076 RSUs outstanding.

As of September 30, 2024, there was approximately $ 12.0 million of unrecognized stock-based compensation cost which is expected to be recognized over a remaining weighted-average period of 2.08 years, related to time-based stock options, performance-based stock options wherein achievement of the corresponding corporate-based milestones was considered as probable, and RSUs.

In March 2024, April 2024 and July 2024, our Board of Directors approved additional 158,122 shares of common stock reserved for issuance under our Inducement Plan.

In May 2024, our stockholders approved an amendment to our 2018 Plan, to, among other items, add an additional 650,000 shares to the number of shares of common stock authorized for issuance under our 2018 Plan.

As of June 30, 2024, there were 1,412,669 shares of common stock available for future grant under our Equity Incentive Plans.

As of September 30, 2024, there were 1,520,361 shares of common stock available for future grant under our Equity Incentive Plans.

Employee Stock Purchase Plan

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The fair value of awards under our Purchase Plan is estimated on the date of our new offering period using the Black-Scholes option pricing model, which is being amortized over the requisite service periods.

As of June 30, 2024, there was no unrecognized stock-based compensation cost related to our Purchase Plan.

During the six months ended June 30, 2024, there were 35,902 shares purchased under the Purchase Plan.

As of June 30, 2024, there were 213,681 shares reserved for future issuance under the Purchase Plan.

As of September 30, 2024, there was approximately $ 0.4 million of unrecognized stock-based compensation cost which is expected to be recognized over a remaining weighted-average period of 1.20 years, related to our Purchase Plan.

During the nine months ended September 30, 2024, there were 35,902 shares purchased under the Purchase Plan.

As of September 30, 2024, there were 213,681 shares reserved for future issuance under the Purchase Plan.

Other Balance Sheet Components

Inventories for the periods presented consist of the following (in thousands):

June 30, 2024

September 30, 2024

December 31, 2023

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Finished goods

Inventories as of June 30, 2024 and December 31, 2023 include inventories acquired from Forma pursuant to the license and transition services agreement.

Inventories as of June 30, 2024 also include inventories acquired from Blueprint pursuant to a Material Transfer Agreement as discussed in Note 5 – In-licensing and Acquisition.

As of June 30, 2024, advance payments to the manufacturer of our raw materials were included within prepaid and other current assets in the condensed balance sheet amounted to $ 2.2 million.

Inventories as of September 30, 2024 and December 31, 2023 include inventories acquired from Forma pursuant to the license and transition services agreement.

Inventories as of September 30, 2024 also include inventories acquired from Blueprint pursuant to a Material Transfer Agreement as discussed in “Note 5 – In-licensing and Acquisition”.

As of September 30, 2024, advance payments to the manufacturer of our raw materials were included within prepaid and other current assets in the condensed balance sheet amounted to $ 3.4 million.

No such advance payment was included within prepaid and other current assets as of December 31, 2023.

Non-current inventories consist primarily of active pharmaceutical ingredients classified as raw materials which have multi-year shelf life, as well as certain work in process and finished goods inventories that are not expected to be consumed beyond our normal operating cycle.

Non-current inventories consists of active pharmaceutical ingredients classified as raw materials which have multi-year shelf life, as well as certain work in process and finished goods inventories that are not expected to be consumed beyond our normal operating cycle.

Intangible assets

Intangible assets consist of the following (in thousands):

June 30, 2024

September 30, 2024

December 31, 2023

Intangible asset cost

Intangible assets cost

Accumulated amortization

Intangible asset, net

Intangible assets, net

See “Note 5 – In-licensing and Acquisition” for related discussions of capitalized intangible assets.

Amortization expense recorded within cost of sales in the statements of operations for the three months ended June 30, 2024 and 2023 was $ 0.6 million and $ 0.3 million, respectively, and for the six months ended June 30, 2024 and 2023 was $ 1.0 million and $ 0.5 million, respectively.

The following table presents the estimated future amortization expense of intangible assets as of June 30, 2024 (in thousands):

Amortization expense recorded within cost of product sales in the condensed statements of operations for the three months ended September 30, 2024 and 2023 was $ 0.6 million and $ 0.3 million, respectively, and for the nine months ended September 30, 2024 and 2023 was $ 1.6 million and $ 0.8 million, respectively.

The following table presents the estimated future amortization expense of intangible assets as of September 30, 2024 (in thousands):

Remainder of 2024

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Cash, cash equivalents and short-term investments for the periods presented consist of the following (in thousands):

June 30, 2024

September 30, 2024

December 31, 2023

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Cash equivalents and short-term investments include the following securities with gross unrealized gains and losses (in thousands):

As of June 30, 2024

As of September 30, 2024

US treasury bills

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Corporate bonds and commercial paper

As of June 30, 2024 and December 31, 2023, our cash equivalents and short-term investments had a weighted-average time to maturity of approximately 68 days and 82 days , respectively.

As of September 30, 2024 and December 31, 2023, our cash equivalents and short-term investments had a weighted-average time to maturity of approximately 39 days and 82 days , respectively.

Our short-term investments are classified as available-for-sale securities.

Accordingly, we have classified these securities as short-term investments on our condensed balance sheets as they are available for use in the current operations.

As of June 30, 2024, we had no investments that had been in a continuous unrealized loss position for more than 12 months.

As of June 30, 2024, a total of 26 individual securities had been in an unrealized loss position for 12 months or less, and the losses were determined to be temporary.

No significant facts or circumstances have arisen to indicate that there has been any significant

deterioration in the creditworthiness of the issuers of the securities held by us.

Based on our review of these securities, including the assessment of the duration and severity of the unrealized losses, we have no t recognized any credit losses on these securities as of June 30, 2024 and December 31, 2023.

The following table shows the fair value and gross unrealized losses of our investments in individual securities that are in an unrealized loss position, aggregated by investment category (in thousands):

As of June 30, 2024

Unrealized Losses

Government-sponsored enterprise securities

Corporate bonds and commercial paper

A s of September 30, 2024 and December 31, 2024, t here were no individual securities that were in a significant unrealized loss position, and the individual securities with unrealized position have been in a loss position for less than one year.

We regularly review the securities in an unrealized loss position and evaluate the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions.

We have no t recognized any credit losses as of September 30, 2024 and December 31, 2023.

The table below summarizes the fair value of our cash equivalents and short-term investments measured at fair value on a recurring basis, and are categorized based upon the lowest level of significant input to the valuations (in thousands):

Assets at Fair Value as of June 30, 2024

Assets at Fair Value as of September 30, 2024

Money market funds

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The following table summarizes loans payable, net (in thousands):

June 30, 2024

September 30, 2024

December 31, 2023

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At the Closing Date, $ 10.0 million was funded (Tranche 1), in May 2020, an additional $ 10.0 million was funded (Tranche 2), at the Second Amendment, an additional $ 10.0 million was funded (Tranche 3), at the Third Amendment, an additional $ 10.0 million was funded (Tranche 4), and in March 2023, an additional $ 20.0 million was funded (Tranche 5).

As of June 30, 2024, the outstanding principal balance of the loan was $ 60.0 million, and no remaining funds are available for draw under the term loan credit facility.

As of September 30, 2024, no remaining funds were available for draw under the term loan credit facility.

The First Amendment to the Credit Agreement extended the period through which Tranche 3 was available to us.

The Second Amendment to the Credit Agreement, among other things, amended the applicable funding conditions, applicable commitments and certain other terms relating to available credit facilities (Tranches 3 and 4), added additional term loan credit facility (Tranche 5), and revised certain terms related to the financial covenants.

Following the Third Amendment but prior to the Fourth Amendment to the Credit Agreement in April 2024 as discussed below, the term loans would mature on September 1, 2026, and the interest-only period was through October 1, 2024.

Prior to the Fourth Amendment to the Credit Agreement as discussed below, the term loans would mature on September 1, 2026, and the interest-only period was through October 1, 2024.

The term loans bore interest equal to the sum of one-month Secured Overnight Financing Rate (SOFR) , plus an adjustment of 0.11448% , subject to 1.50 % applicable floor, plus applicable margin of 5.65 % , and a final payment fee of 2.5 % of principal due at maturity date.

Following the Fourth Amendment to the Credit Agreement in April 2024, the term loans mature on September 1, 2027, and the interest-only period is through October 1, 2025.

Following the Fourth Amendment to the Credit Agreement, the term loans mature on September 1, 2027, and the interest-only period is through October 1, 2025.

The term loans bear interest equal to the sum of one-month SOFR plus an adjustment of 0.11448% , subject to a 4.00 % applicable floor, plus applicable margin of 6.50 % .

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The obligations under the amended Credit Agreement are secured by a perfected security interest in all of our assets including our intellectual property.

Interest expense, including amortization of the debt discount and accretion of the final fees related to the Credit Agreement for the three months ended June 30, 2024 and 2023 was $ 2.0 million and $ 1.9 million, respectively, and for the six months ended June 30, 2024 and 2023 was $ 3.9 million and $ 3.1 million, respectively.

Accrued interest of $ 1.8 million was included within other accrued liabilities in the condensed balance sheet as of June 30, 2024.

The following table presents the future minimum principal payments of the outstanding loan as of June 30, 2024 (in thousands):

Interest expense, including amortization of the debt discount and accretion of the final fees related to the Credit Agreement for the three months ended September 30, 2024 and 2023 was $ 2.1 million and $ 1.9 million, respectively, and for the nine months ended September 30, 2024 and 2023 was $ 6.0 million and $ 5.0 million, respectively.

Accrued interest of $ 1.9 million was included within other accrued liabilities in the condensed balance sheet as of September 30, 2024.

The following table presents the future minimum principal payments of the outstanding loan as of September 30, 2024 (in thousands):

Remainder of 2024

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The amended Credit Agreement contains certain covenants which, among others, require us to deliver financial reports at designated times of the year and maintain minimum unrestricted cash and trailing net revenues.

As of June 30, 2024, we were not in violation of any covenants.

As of September 30, 2024, we were not in violation of any covenants.

We have a sublease agreement with Atara Biotherapeutics, Inc.

(Atara) entered in October 2022 to sublease an office space located in South San Francisco, California.

entered in October 2022 to sublease an office space located in South San Francisco, California.

Subject to the terms of the sublease agreement, the lease term commenced in November 2022 and shall expire in May 2025.

This leased facility is currently held as our new Headquarters following the expiration of our previously leased facility in January 2023.

The weighted average remaining term of our leases as of June 30, 2024 was 0.92 years.

This leased facility is currently held as our Headquarters following the expiration of our previously leased facility in January 2023.

The weighted average remaining term of our leases as of September 30, 2024 was 0.67 years.

We previously leased our prior headquarter space located in South San Francisco, California with Healthpeak Properties, Inc.

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The components of our operating lease expense were as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Fixed operating lease expense

Variable operating lease expense (net credit)

Variable operating lease expense

Total operating lease expense

Supplemental information related to our operating lease were as follow (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Cash payments included in the measurement of operating lease liabilities

Supplemental information related to our operating sublease was as follow (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Fixed sublease expense

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Sublease income

The following table presents the future lease payments as of June 30, 2024 (in thousands):

The following table presents the future lease payments as of September 30, 2024 (in thousands):

Remainder of 2024

Total minimum payments required

Subsequent Event

Purchase commitment

In the ordinary course of business, we enter into agreements with contract manufacturers to manufacture our inventory products.

In October 2024, we entered into an agreement with a third-party contract manufacturer to manufacture TAVALISSE that are expected to be delivered starting in fiscal year 2026 through 2029, for a total contract price of approximately $ 24.0 million.

Although the agreement provides a cancellation clause with or without cause upon written notice, we may or may not be subject to payment of a cancellation fee.

The level of cancellation fee is generally dependent on the timing of the written notice in relation to the commencement date of work, with the maximum cancellation fee equal to the full price of the work order.

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