Cartesian Therapeutics, Inc. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures, as defined in Exchange Act Rules 13a-15(e) and 15d-15(e), that are designed to ensure information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principle financial officer, to allow timely decisions regarding required disclosure. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are achieved. Further, the design of a control system must be balanced against resource constraints, and therefore, the benefits of controls must be considered relative to their costs. Given the inherent limitations in all systems of controls, no evaluation of controls can provide absolute assurance all control issues and instances of fraud, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of controls. The design of any system of controls is also based in part upon certain assumptions about the 72 Table of Contents likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies and procedures may deteriorate. Accordingly, given the inherent limitations in a cost-effective system of controls, financial statement misstatements due to error or fraud may occur and may not be detected. Our disclosure controls and procedures are designed to provide reasonable, not absolute, assurance of achieving their objectives. We conduct periodic evaluations of our system of controls to enhance, where necessary, our control policies and procedures. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K. Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of December 31, 2025. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rules 13a-15(f) and 15d-15(f), to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP. Internal control over financial reporting includes our policies and procedures, such as our Code of Business Conduct and Ethics, which (i) require our employees, officers and directors to adhere to certain ethical standards; (ii) require the maintenance of records, in reasonable detail, to help to ensure that our transactions, assets and liabilities are accurately and fairly recorded; (iii) provide reasonable assurance that transactions are authorized by our management and directors and are recorded as necessary to allow for the accurate preparation of financial statements in accordance with U.S. GAAP; and (iv) provide reasonable assurance regarding the safeguarding of our assets and the prevention or timely detection of the unauthorized acquisition, use or disposition of our assets, which could have a material effect on the financial statements. Internal control over financial reporting includes the controls themselves, management’s monitoring of those controls, actions taken to correct any deficiencies identified and oversight of our internal control environment by the Audit Committee of our Board of Directors. Any system of internal control has inherent limitations and therefore may not prevent or detect misstatements. Projections of any evaluation of the effectiveness of internal control over financial reporting to future periods are subject to the risk that controls may become inadequate over time because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our management assessed the effectiveness of our internal control over financial reporting as of the end of our fiscal year 2025 and has reviewed the results of this assessment with the Audit Committee of our Board of Directors. Management based its assessment on criteria established in “Internal Control - Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based upon this assessment, our management concluded that our internal control over financial reporting was effective as of December 31, 2025. Changes in Internal Control over Financial Reporting There have been no changes in our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) during the fiscal quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Attestation Report of the Registered Public Accounting Firm This Annual Report on Form 10-K does not include an attestation report of our registered public accounting firm due to an exemption established for registrants that are non-accelerated filers. Item 9B. Other Information During the fiscal quarter ended December 31, 2025, no officer or director, as defined in Rule 16a-1(f) of the Exchange Act, informed us of the adoption , modification or termination of any “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408 of Regulation S-K . Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 73 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance Incorporated by reference from the information in our Proxy Statement for our 2026 Annual Meeting of Stockholders, which we will file with the SEC within 120 days of the end of the fiscal year to which this Annual Report on Form 10-K relates. Item 11. Executive Compensation Incorporated by reference from the information in our Proxy Statement for our 2026 Annual Meeting of Stockholders, which we will file with the SEC within 120 days of the end of the fiscal year to which this Annual Report on Form 10-K relates. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Incorporated by reference from the information in our Proxy Statement for our 2026 Annual Meeting of Stockholders, which we will file with the SEC within 120 days of the end of the fiscal year to which this Annual Report on Form 10-K relates. Item 13. Certain Relationships and Related Transactions, and Director Independence Incorporated by reference from the information in our Proxy Statement for our 2026 Annual Meeting of Stockholders, which we will file with the SEC within 120 days of the end of the fiscal year to which this Annual Report on Form 10-K relates. Item 14. Principal Accountant Fees and Services Incorporated by reference from the information in our Proxy Statement for our 2026 Annual Meeting of Stockholders, which we will file with the SEC within 120 days of the end of the fiscal year to which this Annual Report on Form 10-K relates. 74 Table of Contents PART IV Item 15. Exhibits, Financial Statement Schedules (a)(1) Financial Statements See the “Index to Consolidated Financial Statements” on page F-1 below for the list of financial statements filed as part of this report. (a)(2) Financial Statement Schedules All financial schedules have been omitted because the required information is either presented in the consolidated financial statements filed as part of this Annual Report on Form 10-K or the notes thereto or is not required. (a)(3) Exhibits The following is a list of exhibits filed as part of this Annual Report on Form 10-K. Incorporated by Reference Exhibit Number Exhibit Description Form File No. Exhibit Filing Date 2.1* Agreement and Plan of Merger, dated November 13, 2023, by and among Selecta Biosciences, Inc., Sakura Merger Sub I, Inc., Sakura Merger Sub II, LLC, and Cartesian Therapeutics, Inc. 8-K 001-37798 2.1 11/13/2023 3.1(a) Restated Certificate of Incorporation of Selecta Biosciences, Inc. 8-K 001-37798 3.1 6/29/2016 3.1(b) Certificate of Amendment to the Restated Certificate of Incorporation of Selecta Biosciences, Inc., dated June 21, 2022 8-K 001-37798 3.1 6/21/2022 3.1(c) Certificate of Amendment to the Restated Certificate of Incorporation of Selecta Biosciences, Inc., dated November 13, 2023 8-K 001-37798 3.3 11/13/2023 3.1(d) Certificate of Amendment to the Restated Certificate of Incorporation, as amended, of Cartesian Therapeutics, Inc., dated March 28, 2024. 8-K 001-37798 3.2 3/28/2024 3.2 Amended and Restated By-laws of Cartesian Therapeutics, Inc. 8-K 001-37798 3.2 10/30/2025 4.1 Specimen Stock Certificate evidencing the shares of common stock 10-K 001-37798 4.1 3/13/2025 4.2 Form of Warrant to Purchase Shares of Series E Preferred Stock, dated December 31, 2015, issued by the Registrant to Oxford Finance LLC and Square One Bank, together with a schedule of warrant holders S-1 333-211555 4.6 5/24/2016 4.3 Registration Rights Agreement, dated as of June 11, 2020, by and between the Registrant and Swedish Orphan Biovitrum AB (Publ) 10-Q 001-37798 4.1 8/6/2020 4.4 Registration Rights Agreement, dated as of June 11, 2020, by and between the Registrant and Swedish Orphan Biovitrum AB (Publ), as amended on November 4, 2020 10-Q 001-37798 4.2 11/5/2020 4.5 Form of Warrant to Purchase Stock, dated August 31, 2020, issued by Selecta Biosciences, Inc. to Oxford Finance LLC and Silicon Valley Bank, together with a schedule of warrants. 8-K 001-37798 4.1 9/3/2020 4.6 Form of Common Stock Purchase Warrant, dated April 11, 2022 8-K 001-37798 4.1 4/6/2022 4.7 Form of Contingent Value Rights Agreement 8-K 001-37798 2.1 11/13/2023 4.8 Registration Rights Agreement, by and among Selecta Biosciences, Inc. and certain purchasers party thereto 8-K 001-37798 10.2 11/13/2023 4.9(a) Certificate of Designation of Preferences, Rights and Limitations of Series A Non-Voting Convertible Preferred Stock 8-K 001-37798 3.4 11/13/2023 75 Table of Contents 4.9(b) Certificate of Amendment to the Certificate of Designation of Series A Non-Voting Convertible Preferred Stock, dated March 26, 2024. 8-K 001-37798 3.1 3/28/2024 4.10 Certificate of Designation of Preferences, Rights and Limitations of Series B Non-Voting Convertible Preferred Stock 8-K 001-37798 3.1 7/2/2024 4.11 Form of Registration Rights Agreement, dated as of July 2, 2024, by and among the Registrant and the Investors named therein. 8-K 001-37798 10.2 7/2/2024 4.12 Description of Securities — — — Filed herewith 10.1# Amended and Restated 2016 Incentive Award Plan and form of award agreements thereunder S-1 333-281204 10.1 8/2/2024 10.2# 2016 Employee Stock Purchase Plan S-1/A 333-211555 10.3 6/8/2016 10.3# Amended and Restated Cartesian Therapeutics, Inc. 2018 Employment Inducement Incentive Award Plan, and forms of award agreements thereunder 10-K 001-37798 10.3 3/13/2025 10.4# Cartesian Therapeutics, Inc. 2016 Stock Incentive Plan, and forms of award agreements thereunder S-8 333-276486 99.1 1/12/2024 10.5# Non-Employee Director Compensation Program 10-K 001-37798 10.5 3/13/2025 10.6# Form of Indemnification Agreement for Directors and Officers S-1 333-211555 10.5 5/24/2016 10.7† Amended and Restated License Agreement, dated as of May 31, 2017, by and between the Registrant and Shenyang Sunshine Pharmaceutical Co., Ltd. 10-Q 001-37798 10.6 8/11/2017 10.8† Manufacturing Services Agreement, dated as of August 1, 2014, by and between the Registrant and Shenyang Sunshine Pharmaceutical Co., Ltd. S-1 333-211555 10.10 5/24/2016 10.9(a) Lease Agreement by and between BRE-BMR Grove LLC and Selecta Biosciences, Inc. dated July 23, 2019 10-Q 001-37798 10.3 11/8/2019 10.9(b) First Amendment to Lease by and between BRE-BMR Grove LLC and Selecta Biosciences, Inc. dated September 1, 2022 10-Q 001-37798 10.1 11/3/2022 10.10(a)† Lease Agreement by and between 704 Quince Orchard Owner, LLC and Cartesian Therapeutics, Inc. dated May 11, 2018 10-K 001-37798 10.11(a) 3/7/2024 10.10(b)† First Amendment to Lease Agreement by and between 704 Quince Orchard Owner, LLC and Cartesian Therapeutics, Inc. dated March 22, 2021 10-K 001-37798 10.11(b) 3/7/2024 10.10(c)† Second Amendment to Lease Agreement by and between 704 Quince Orchard Owner, LLC and Cartesian Therapeutics, Inc. dated May 3, 2021 10-K 001-37798 10.11(c) 3/7/2024 10.11(a)† Lease Agreement by and between 7495 RP, LLC and Cartesian Therapeutics, Inc. dated February 28, 2024 10-K 001-37798 10.12 3/7/2024 10.11(b)† First Amendment to Lease Agreement by and between 7495 RP, LLC and the Registrant dated May 7, 2024 10-Q 001-37798 10.3(b) 5/8/2024 10.11(c)† Second Amendment to Lease Agreement by and between 7495 RP, LLC and the Registrant dated August 30, 2024 10-Q 001-37798 10.1 11/7/2024 10.11(d)† Third Amendment to Lease Agreement by and between 7495 RP, LLC and the Registrant dated March 13, 2025 10-Q 001-37798 10.1 5/8/2025 10.11(e) Fourth Amendment to Lease Agreement by and between 7495 RP, LLC and the Registrant dated June 26, 2025 10-Q 001-37798 10.1 8/7/2025 10.12# Employment Agreement, dated as of September 25, 2018, by and between the Registrant and Carsten Brunn, Ph.D. 8-K 001-37798 10.2 9/27/2018 10.13# Employment Agreement, dated as of November 9, 2022, by and between the Registrant and Blaine Davis 10-K 001-37798 10.15 3/2/2023 10.14# Employment Agreement, dates as of March 26, 2024, by and between the Registrant and Christopher Jewell, Ph.D. 8-K 001-37798 10.1 4/1/2024 10.15# Employment Agreement, dates as of March 28, 2024, by and between the Registrant and Metin Kurtoglu, M.D., Ph.D. 8-K 001-37798 10.2 4/1/2024 76 Table of Contents 10.16(a)† License and Development Agreement, dated as of June 11, 2020, by and between the Registrant and Swedish Orphan Biovitrum AB (Publ) 10-Q 001-37798 10.2 8/6/2020 10.16(b)† Amendment No. 1 to License and Development Agreement, dated as of October 31, 2023, by and between the Registrant and Swedish Orphan Biovitrum AB (Publ) 10-K 001-37798 10.15(b) 3/7/2024 10.17† Patent License Agreement, between Cartesian Therapeutics, Inc. and the U.S. Department of Health and Human Services, as represented by the National Cancer Institute of the National Institutes of Health, dated September 16, 2019 10-K 001-37798 10.16 3/7/2024 10.18† Patent License Agreement by and between Biogen MA, Inc. and Cartesian Therapeutics, Inc., dated September 8, 2023 10-K 001-37798 10.17 3/7/2024 10.19# Form of Retention Bonus Letter 8-K 001-37798 10.3 11/13/2023 10.20 Securities Purchase Agreement, dated as of November 13, 2023, by and among Selecta Biosciences, Inc. and each purchaser identified on Annex A thereto 8-K 001-37798 10.1 11/13/2023 10.21 Sales Agreement, dated as of December 13, 2024, by and between the Registrant and Leerink Partners LLC S-3 333-283803 1.2 12/13/2024 10.22# S eparation Agreement , dated as of October 20 , 2025, by and between the Company and Christopher Jewell — — — Filed herewith 10.23#† Separation Agreement, dated as of April 29, 2025, by and between the Company and Metin Kurtoglu 10-Q 001-37798 10.2 5/8/2025 19.1 Cartesian Therapeutics, Inc. Insider Trading Policy — — — Filed herewith 21.1 Subsidiaries of Cartesian Therapeutics, Inc. — — — Filed herewith 23.1 Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm — — — Filed herewith 31.1 Certification of Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 — — — Filed herewith 31.2 Certification of Principal Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 — — — Filed herewith 32.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 — — — Filed herewith 97 Cartesian Therapeutics, Inc. Compensation Clawback Policy 10-K 001-37798 97 3/7/2024 101.INS Inline XBRL Instance Document - the Instance Document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL Document — — — Filed herewith 101.SCH Inline XBRL Taxonomy Extension Schema Document — — — Filed herewith 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document — — — Filed herewith 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document — — — Filed herewith 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document — — — Filed herewith 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document — — — Filed herewith 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) — — — Filed herewith # Indicates management contract or compensatory plan. 77 Table of Contents * Certain annexes, schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted attachment to the SEC on a confidential basis upon request. † Certain confidential information contained in this exhibit, marked by brackets and asterisks, has been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K because the information (i) is not material and (ii) is the type of information that the Company both customarily and actually treats as private and confidential. Item 16. Form 10-K Summary None. 78 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CARTESIAN THERAPEUTICS, INC. Date: March 9, 2026 By: /s/ Carsten Brunn, Ph.D. Carsten Brunn, Ph.D. President, Chief Executive Officer and Chairman of the Board Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant in the capacities and on the dates indicated. Signature Title Date /s/ Carsten Brunn, Ph.D. President, Chief Executive Officer and Chairman of the Board March 9, 2026 Carsten Brunn, Ph.D. (Principal Executive Officer) /s/ Blaine Davis Chief Financial Officer March 9, 2026 Blaine Davis (Principal Financial and Accounting Officer) /s/ Patrick Zenner Lead Independent Director March 9, 2026 Patrick Zenner /s/ Timothy C. Barabe Director March 9, 2026 Timothy C. Barabe /s/ Adrian Bot Director March 9, 2026 Adrian Bot /s/ Nishan de Silva, M.D. Director March 9, 2026 Nishan de Silva, M.D. /s/ Murat Kalayoglu, M.D., Ph.D. Director March 9, 2026 Murat Kalayoglu, M.D., Ph.D. /s/ Kemal Malik MBBS Director March 9, 2026 Kemal Malik, MBBS /s/ Michael Singer, M.D., Ph.D. Director March 9, 2026 Michael Singer, M.D., Ph.D. /s/ Timothy Springer, Ph.D. Director March 9, 2026 Timothy Springer, Ph.D. 79 Table of Contents Cartesian Therapeutics, Inc. and Subsidiaries Index to Consolidated Financial Statements Pages Report of Independent Registered Public Accounting Firm (PCAOB ID: 42 ) F-2 Consolidated Balance Sheets at December 31, 2025 and 2024 F- 5 Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2025 and 2024 F- 5 Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders' Deficit for the years ended December 31, 2025 and 2024 F- 6 Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024 F- 7 Notes to Consolidated Financial Statements F- 8 F-1 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Cartesian Therapeutics, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Cartesian Therapeutics, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, changes in convertible preferred stock and stockholders’ deficit and cash flows for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as F-2 Table of Contents a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Valuation of contingent value right Description of the Matter As of December 31, 2025, the Company recorded the contingent value right liability and the contingent value right liability, net of current portion of zero and $392.1 million, respectively. As described in Note 2, the Company estimates the fair value of the Contingent Value Right (“CVR”) using a Monte Carlo simulation to estimate future cash flows associated with the legacy assets, including the expected milestone and royalty payments under the Company’s License and Development Agreement with Swedish Orphan Biovitrum AB (publ.) as amended, net of deductions. Changes in the fair value of the liability are presented in the consolidated statements of operations and comprehensive loss. The liability value is calculated based on significant inputs that are not observable in the market such as estimated cash flows, estimated probabilities of success, and expected volatilities of revenues, which represent Level 3 measurements within the fair value hierarchy. For the year ended December 31, 2025, the Company recorded a loss on the change in the fair value of the contingent value right liability of $4.4 million. Auditing the fair value of the CVR liability was complex due to the significant judgment required in estimating the fair value. In particular, the fair value estimate required the use of valuation methodologies that were sensitive to significant assumptions including expected milestone and royalty payments and discount rate which are based on estimates of future market or economic conditions. How We Addressed the Matter in Our Audit To test the fair value of the CVR liability, our audit procedures included, among others, assessing the appropriateness of the valuation methodology and testing the significant assumptions and the completeness and accuracy of the underlying data used by the Company. We compared the assumptions for expected milestone and royalty payments to projected industry revenue growth rates and other factors considered by management in developing the model. We involved our valuation specialist to assist in evaluating the valuation methodologies and discount rate used to value the CVR liability. Impairment of Goodwill and Indefinite-Lived Intangibles Description of the Matter As of December 31, 2025, the Company’s goodwill and indefinite-lived intangible asset balances were $48.2 million and $93.9 million, respectively. As disclosed in Note 2 of the consolidated financial statements, goodwill and indefinite-lived intangible assets are tested for impairment annually, or more frequently if events or circumstances indicate the fair value of the reporting unit or the intangible assets may be below its carrying value. In order to determine if assets have been impaired, assets are tested at the lowest level for which identifiable independent cash flows are available. An impairment loss is recognized when the sum of projected discounted cash flows is less than the carrying value of the asset group. If the carrying value exceeds the fair value, an impairment charge is recognized equal to the difference between the carrying value of the reporting unit and its fair value for goodwill, or the difference between the carrying value of the indefinite-lived intangible assets and its fair value for indefinite-lived intangible assets. During the year ended December 31, 2025, the Company recorded an impairment charge related to the Descartes-08 for SLE indefinite-lived intangible asset of $56.7 million. Auditing management’s impairment tests of goodwill and indefinite-lived intangible assets was complex and judgmental due to the measurement uncertainty in determining the fair values of the reporting unit and indefinite-lived intangible assets. In particular, the fair value estimates of the reporting unit and indefinite-lived intangible assets were sensitive to changes in significant assumptions such as certain assumptions that form the basis of the forecasted results (e.g., revenue, discount rates, control premiums and probability of clinical success). These significant assumptions are especially challenging to audit as they are forward-looking and could be affected by future economic and market conditions. F-3 Table of Contents How We Addressed the Matter in Our Audit To test the estimated fair values of the reporting unit and indefinite-lived intangible assets, our audit procedures included, among others, evaluating the Company’s valuation methodology and significant assumptions used by management, and testing the completeness and accuracy of the underlying data supporting the significant assumptions mentioned above. We performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the reporting unit and indefinite-lived intangible assets resulting from changes in the assumptions. We compared the significant assumptions used by management to current industry and economic trends. We utilized internal valuation specialists to assist in our evaluation of the Company's valuation methodologies and certain significant assumptions. In addition, for goodwill we also tested management’s reconciliation of the fair value of the reporting unit to the market capitalization of the Company. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2009. Boston, Massachusetts March 9, 2026 F-4 Table of Contents Cartesian Therapeutics, Inc. and Subsidiaries Consolidated Balance Sheets (Amounts in thousands, except share data and par value) December 31, 2025 2024 Assets Current assets: Cash and cash equivalents $ 125,139 $ 212,610 Accounts receivable 1,115 872 Prepaid expenses and other current assets 3,022 3,144 Total current assets 129,276 216,626 Property and equipment, net 12,185 9,912 Right-of-use assets, net 5,601 5,535 In-process research and development assets 93,900 150,600 Goodwill 48,163 48,163 Long-term restricted cash 1,735 1,669 Investment — 2,000 Long-term prepaid expenses and other assets 5,551 518 Total assets $ 296,411 $ 435,023 Liabilities and stockholders’ deficit Current liabilities: Accounts payable $ 1,288 $ 288 Accrued expenses and other current liabilities 9,498 12,076 Lease liabilities 4,151 2,851 Contingent value right liability — 7,761 Total current liabilities 14,937 22,976 Lease liabilities, net of current portion 8,525 11,133 Warrant liability 141 3,836 Contingent value right liability, net of current portion 392,100 387,739 Deferred tax liabilities, net 6,948 16,141 Total liabilities 422,651 441,825 Commitments and contingencies (Note 18) Stockholders’ deficit: Series A Preferred Stock, $ 0.0001 par value; 134,904.563 shares authorized as of December 31, 2025 and 2024; 120,790.402 shares issued and outstanding as of December 31, 2025 and 2024 — — Series B Preferred Stock, $ 0.0001 par value; 437,927 shares authorized, issued and outstanding as of December 31, 2025 and 2024 — — Preferred stock, $ 0.0001 par value; 9,427,168.437 shares authorized as of December 31, 2025 and 2024; no shares issued and outstanding as of December 31, 2025 and 2024 — — Common stock, $ 0.0001 par value; 350,000,000 shares authorized as of December 31, 2025 and 2024; 26,011,106 and 25,767,369 shares issued and outstanding as of December 31, 2025 and 2024, respectively 3 3 Additional paid-in capital 700,706 689,887 Accumulated deficit ( 822,373 ) ( 692,071 ) Accumulated other comprehensive loss ( 4,576 ) ( 4,621 ) Total stockholders’ deficit ( 126,240 ) ( 6,802 ) Total liabilities and stockholders’ deficit $ 296,411 $ 435,023 The accompanying notes are an integral part of these consolidated financial statements. F-5 Table of Contents Cartesian Therapeutics, Inc. and Subsidiaries Consolidated Statements of Operations and Comprehensive Loss (Amounts in thousands, except share and per share dat a) Year Ended December 31, 2025 2024 Revenues: Collaboration and license $ 400 $ 38,275 Grant 2,397 638 Total revenues 2,797 38,913 Operating expenses: Research and development 58,034 45,105 General and administrative 31,468 30,126 Impairment of indefinite-lived intangible and long-lived assets 56,700 7,579 Total operating expenses 146,202 82,810 Operating loss ( 143,405 ) ( 43,897 ) Other income (expense): Interest income 6,579 7,386 Gain on change in fair value of warrant liabilities 3,695 2,558 Loss on change in fair value of contingent value right liability ( 4,354 ) ( 36,900 ) Loss on change in fair value of forward contract liabilities — ( 6,890 ) Other (expense) income, net ( 2,010 ) 606 Total other income (expense), net 3,910 ( 33,240 ) Loss before income taxes ( 139,495 ) ( 77,137 ) Income tax benefit (expense) 9,193 ( 287 ) Net loss $ ( 130,302 ) $ ( 77,424 ) Other comprehensive income (loss): Foreign currency translation adjustment 45 ( 21 ) Total comprehensive loss $ ( 130,257 ) $ ( 77,445 ) Net loss $ ( 130,302 ) $ ( 77,424 ) Net loss per share allocable to common stockholders: Basic $ ( 5.02 ) $ ( 4.48 ) Diluted $ ( 5.02 ) $ ( 4.49 ) Weighted-average common shares outstanding: Basic 25,973,329 17,276,822 Diluted 25,973,329 17,357,943 The accompanying notes are an integral part of these consolidated financial statements. F-5 Table of Contents Cartesian Therapeutics, Inc. and Subsidiaries Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders’ Deficit (Amounts in thousands, except share data) Series A Preferred Stock Options for Series A Preferred Stock Series A Preferred Stock Series B Preferred Stock Additional paid-in capital Accumulated deficit Accumulated other comprehensive loss Stockholders’ deficit Common stock Shares Amount Amount Shares Amount Shares Amount Shares Amount Balance at December 31, 2023 435,120.513 $ 296,851 $ 3,703 — $ — — $ — 5,397,597 $ 1 $ 179,062 $ ( 614,647 ) $ ( 4,600 ) $ ( 440,184 ) Issuance of Series A Preferred Stock in connection with private placement and settlement of related forward contract 99,140.326 75,197 — — — — — — — — — — — Transfer of Series A Preferred Stock and options for Series A Preferred Stock to permanent equity ( 534,260.839 ) ( 372,048 ) ( 3,703 ) 534,260.839 — — — — — 375,751 — — 375,751 Conversion of Series A Preferred Stock to common stock — — — ( 413,470.437 ) — — — 13,782,324 2 ( 2 ) — — — Issuance of Series B Preferred Stock and common stock in connection with private placement, net of issuance costs of $ 5,585 — — — — — 2,937,903 — 3,563,247 — 124,438 — — 124,438 Conversion of Series B Preferred Stock to common stock — — — — — ( 2,499,976 ) — 2,499,976 — — — — — Issuance of common stock upon exercise of options — — — — — — — 458,544 1,179 — — 1,179 Issuance of common stock upon exercise of warrants — — — — — — — 65,681 2,877 — — 2,877 Stock-based compensation expense — — — — — — — — — 6,582 — — 6,582 Currency translation adjustment — — — — — — — — — — — ( 21 ) ( 21 ) Net loss — — — — — — — — — — ( 77,424 ) — ( 77,424 ) Balance at December 31, 2024 — $ — $ — 120,790.402 $ — 437,927 $ — 25,767,369 $ 3 $ 689,887 $ ( 692,071 ) $ ( 4,621 ) $ ( 6,802 ) Issuance of common stock upon exercise of options — — — — — — — 90,444 — 298 — — 298 Issuance of common stock upon vesting of restricted stock units — — — — — — — 153,293 — — — — — Stock‑based compensation expense — — — — — — — — — 10,521 — — 10,521 Currency translation adjustment — — — — — — — — — — — 45 45 Net loss — — — — — — — — — — ( 130,302 ) — ( 130,302 ) Balance at December 31, 2025 — $ — $ — 120,790.402 $ — 437,927 $ — 26,011,106 $ 3 $ 700,706 $ ( 822,373 ) $ ( 4,576 ) $ ( 126,240 ) On April 4, 2024, the Company effected a 1-for-30 reverse split of its issued and outstanding shares of common stock, or the Reverse Stock Split. As a result of the Reverse Stock Split, all figures in this Annual Report on Form 10-K relating to shares of the Company’s common stock (such as share amounts, per share amounts, and conversion rates and prices), including but not limited to, the consolidated financial statements and footnotes included herein, have been adjusted to reflect the Reverse Stock Split for all periods presented. The accompanying notes are an integral part of these consolidated financial statements. F-6 Table of Contents Cartesian Therapeutics, Inc. and Subsidiaries Consolidated Statements of Cash Flows (Amounts in thousands) Year Ended December 31, 2025 2024 Cash flows from operating activities Net loss $ ( 130,302 ) $ ( 77,424 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 2,959 1,151 Non‑cash lease expense 778 2,437 Loss on disposal of property and equipment — 273 Impairment of indefinite-lived intangible and long-lived assets 56,700 7,579 Stock‑based compensation expense 10,521 6,582 Gain on change in fair value of warrant liabilities ( 3,695 ) ( 2,558 ) Loss on change in fair value of CVR liability 4,354 36,900 Loss on change in fair value of forward contract liabilities — 6,890 Loss on impairment of investment 2,000 — (Benefit) provision for deferred taxes ( 9,193 ) 287 Changes in operating assets and liabilities: Accounts receivable ( 243 ) 4,998 Unbilled receivable — 2,981 Prepaid expenses and other assets ( 5,298 ) 1,747 Accounts payable 1,066 ( 2,927 ) Deferred revenue — ( 5,849 ) Accrued expenses and other liabilities ( 3,588 ) ( 6,741 ) Net cash used in operating activities ( 73,941 ) ( 23,674 ) Cash flows from investing activities Purchases of property and equipment ( 5,454 ) ( 9,093 ) Proceeds from the sale of property and equipment — 351 Net cash used in investing activities ( 5,454 ) ( 8,742 ) Cash flows from financing activities Proceeds from issuance of Series A Preferred Stock, gross in private placement — 40,000 Net proceeds from issuance of common stock and Series B Preferred Stock in private placement — 124,438 Equity offering costs ( 624 ) ( 66 ) Proceeds from exercise of common warrants — 2,877 Proceeds from exercise of stock options 323 1,179 Distribution of Contingent Value Rights ( 7,754 ) — Net cash (used in) provided by financing activities ( 8,055 ) 168,428 Effect of exchange rate changes on cash 45 ( 21 ) Net change in cash, cash equivalents, and restricted cash ( 87,405 ) 135,991 Cash and cash equivalents at beginning of period 214,279 78,288 Cash and cash equivalents at end of period $ 126,874 $ 214,279 Non-cash investing and financing activities Purchase of property and equipment not yet paid $ 18 $ 847 Equity offering costs in accrued liabilities $ 30 $ 451 Operating lease right-of-use assets obtained in exchange for operating lease liabilities $ 844 $ 5,246 The accompanying notes are an integral part of these consolidated financial statements . F-7 Table of Contents Cartesian Therapeutics, Inc. and Subsidiaries Notes to Consolidated Financial Statements 1. Description of the Business Cartesian Therapeutics, Inc., or the Company, (formerly known as Selecta Biosciences, Inc., or Selecta) was incorporated in Delaware on December 10, 2007, and is headquartered in Frederick, Maryland. The Company is a late clinical-stage biotechnology company pioneering cell therapy for the treatment of autoimmune diseases. The Company leverages its proprietary technology and manufacturing platform to introduce mRNA into cells to provide a therapeutic effect to patient suffering from a variety of autoimmune conditions. Unlike DNA, mRNA degrades naturally over time without integrating into the cell’s genetic material. Its cell therapies are designed to be dosed repeatedly like conventional drugs, administered in an outpatient setting and given without pre-treatment chemotherapy, which is required with many conventional cell therapies. On November 13, 2023, the Company acquired, in accordance with the terms of the Agreement and Plan of Merger, or the Merger Agreement, the assets of the Delaware corporation which, immediately prior to the Merger (as defined below), was known as Cartesian Therapeutics, Inc., or Old Cartesian. The transaction was structured as a stock-for-stock transaction pursuant to which all of Old Cartesian’s outstanding shares of capital stock were exchanged based on a fixed exchange ratio for consideration of 224,099 shares of common stock, par value $ 0.0001 per share, of the Company, or the common stock, and 384,930.724 shares of the newly designated Series A Non-Voting Convertible Preferred Stock, par value $ 0.0001 per share, or the Series A Preferred Stock, or the Merger. The Series A Preferred Stock is intended to have economic rights similar to the common stock, but with only limited voting rights. Additionally, the Company assumed all outstanding stock options of Old Cartesian. The common stock and Series A Preferred Stock related to the Merger were issued on December 5, 2023. The Company’s Product Candidates The Company aims to provide a personalized approach to treating patients that begins with the collection of a patient’s cells which is then used to manufacture the Company’s cell therapy product candidates. Once a patient’s cells have expanded in the Company’s process, mRNA is introduced to deliver a chimeric antigen receptor into the cell. Once the manufacturing process is complete, the product is sent back to the treating physician where they administer six weekly infusions of the Company’s cell therapy candidate to the patient. The Company’s product candidate is specifically designed to target and destroy the pathogenic, self-reactive cell that are the underlying cause of the autoimmune disease, with the goal of creating a precision immune reset for the patient. Descartes-08, the Company’s lead cell therapy product candidate, is an autologous chimeric antigen receptor T-cell therapy, or CAR-T, product targeting B-cell maturation antigen, or BCMA, in clinical development for the treatment of generalized myasthenia gravis, or MG, and myositis, specifically, moderate to sever multi-refractory dermatomyositis and anti antisynthetase syndrome. In contrast to conventional DNA-based CAR T-cell therapies, the Company’s CAR-T administration is designed to not require preconditioning chemotherapy, to be administered in the outpatient setting and does not carry the risk of genomic integration associated with cancerous transformation. Descartes-08 has been granted Orphan Drug Designation and Regenerative Medicine Advanced Therapy Designation by the U.S. Food and Drug Administration, or FDA, for the treatment of MG, and Rare Pediatric Disease Designation for the treatment of juvenile dermatomyositis. Liquidity and Management’s Plan As of December 31, 2025, the Company had an accumulated deficit of $ 822.4 million. The Company anticipates operating losses to continue for the foreseeable future due to, among other things, costs related to research and development of its product candidates and its administrative organization. As of December 31, 2025, the Company’s cash, cash equivalents, and restricted cash were $ 126.9 million, of which $ 1.7 million was restricted cash related to lease commitments. The Company believes the cash, cash equivalents and restricted cash as of December 31, 2025 will enable it to fund its current planned operations for at least the next 12 months from the date of issuance of these financial statements, though it may pursue additional cash resources through public or private equity or debt financings or by establishing collaborations with other companies. However, there is no guarantee that any of these strategic or financing opportunities will be executed on favorable terms, and some could be dilutive to existing stockholders. Further, the liability associated with the Contingent Value Rights, or CVR, Agreement (as defined below) will be settled solely through cash flow received under the Company’s License and Development Agreement, or as so amended, the Sobi License, with Swedish Orphan Biovitrum AB (publ.), or Sobi, and any other Gross Proceeds (as defined in the CVR Agreement) net of certain agreed deductions. Under the CVR Agreement, 100 % of all milestone payments, royalties and other amounts paid to the Company or controlled entities under the Sobi License, and any other Gross Proceeds will be distributed, net of specified deductions, to holders of the CVRs. There is no obligation to the Company to fund any amount related to the CVR liability. See Note 6, “Fair Value Measurements”. F-8 Table of Contents If the Company is unable to obtain additional funding on a timely basis, it may be forced to significantly curtail, delay, or discontinue one or more of its planned research or development programs or be unable to expand its operations or otherwise capitalize on its commercialization of its product candidates. 2. Summary of Significant Accounting Policies Basis of presentation and consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Selecta (RUS), LLC, or Selecta (RUS), a Russian limited liability corporation, Selecta Biosciences Security Corporation, a Massachusetts securities corporation which the Company dissolved in December 2024, and Cartesian Bio, LLC, a Delaware limited liability company, which is a variable interest entity for which the Company is the primary beneficiary and have been prepared in conformity with accounting principles generally accepted in the United States of America, or GAAP. Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification, or ASC and Accounting Standards Update, or ASU, of the Financial Accounting Standards Board, or FASB. All significant intercompany accounts and transactions have been eliminated. Use of estimates The preparation of consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company’s management considers many factors in selecting appropriate financial accounting policies and controls, and bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. In preparing these consolidated financial statements, management used significant estimates in the following areas, among others: estimated fair value of the intangible assets acquired in connection with the Merger, estimated fair value of the CVRs, deferred income taxes, revenue recognition, estimated accrued research and development expenses, stock-based compensation expense, estimated fair value of the liability-classified warrants, and impairment of goodwill, indefinite-lived intangible assets and long-lived assets. The Company assesses the above estimates on an ongoing basis; however, actual results could materially differ from those estimates. Segment information Operating segments are defined as components of an enterprise for which separate and discrete information is available for evaluation by the chief operating decision maker, or the CODM, for the purposes of assessing performance and allocating resources. The Company views its operations and manages its business in one operating segment, which prior to the Merger related to the research and development of nanoparticle immunomodulatory drugs for the treatment and prevention of human diseases and subsequent to the Merger relates to the research and development of cell therapy product candidates. The Company’s CODM function is fulfilled by its Chief Executive Officer. The CODM function assesses performance for the segment and decides how to allocate resources based on consolidated net loss that is also reported on the consolidated statements of operations and comprehensive loss. The CODM function uses net loss to monitor budget versus actual results to assess performance of the segment. Segment assets are the same as total assets on the Company’s consolidated balance sheets. All long-lived assets are located in the United States. Long-lived assets consist of property and equipment, net, and operating lease right-of-use assets. Cash Equivalents, Marketable Securities and Investments Cash equivalents include all highly liquid investments maturing within 90 days from the date of purchase. Marketable securities consist of securities with remaining maturities greater than 90 days when purchased. The Company classifies these marketable securities as available-for-sale and records them at fair value in the accompanying consolidated balance sheets. Marketable securities with less than one year until maturity are classified as short term, while marketable securities with maturities greater than one year are classified as long term. Unrealized gains or losses are included in accumulated other comprehensive loss. Premiums or discounts from par value are amortized to interest income over the life of the underlying investment. Although available to be sold to meet operating needs or otherwise, securities are generally held through maturity. The cost of securities sold is determined based on the specific identification method for purposes of recording realized gains and losses. The Company has also in the past invested in equity securities of a company whose securities are not publicly traded and where fair value is not readily available. This investment is recorded using cost minus impairment adjusted for changes in observable prices, depending on our ownership percentage and other factors that suggest the Company has a significant influence. The Company monitors this investment to evaluate whether any increase or decline in its value has occurred, based F-9 Table of Contents on the implied value of recent company financings, public market prices of comparable companies and general market conditions. This investment is included in investments in the consolidated balance sheets. Concentrations of Credit Risk and Off-Balance Sheet Risk Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of cash, cash equivalents, short-term deposits, investments, accounts receivable, and unbilled receivables. Cash and cash equivalents are deposited with federally insured financial institutions in the United States and may, at times, exceed federally insured limits. Management believes that the financial institutions that hold the Company’s deposits are financially creditworthy and, accordingly, minimal risk exists with respect to those balances. Fair Value of Financial Instruments The Company’s financial instruments consist mainly of cash equivalents, restricted cash, accounts receivable, accounts payable, accrued expenses and other current liabilities, investments, warrants to purchase common stock, forward contract liabilities, and contingent value rights. The carrying amounts of cash equivalents, restricted cash, accounts receivable, accounts payable, and accrued expenses and other current liabilities approximate their estimated fair value due to their short-term maturities. Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level hierarchy is used to prioritize the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements), and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1—Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2—Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified (contractual) term, a Level 2 input must be observable for substantially the full term of the asset or liability. Level 3—Level 3 inputs are unobservable inputs for the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. To the extent that a valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The fair value of warrant liabilities and contingent value rights are determined using Level 3 inputs. Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the Company’s own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Company uses prices and inputs that are current as of the measurement date, including during periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may change for many instruments. This condition could cause an instrument to be reclassified within levels in the fair value hierarchy. The carrying amounts reflected in the consolidated balance sheet for investments approximate fair value and are assessed for impairment quarterly. Property and Equipment Property and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the respective assets, generally seven years for furniture and fixtures, five years for laboratory equipment, software and office equipment and three years for computer equipment. Leasehold improvements are amortized over their useful life or the life of the lease, whichever is shorter. Major additions and betterments are capitalized. Maintenance and repairs, which do not improve or extend the life of the respective assets, are charged to operations as incurred. Costs incurred for construction in progress are recorded as assets and are not amortized until the construction is substantially complete and the assets are ready for their intended use. F-10 Table of Contents Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. In order to determine if assets have been impaired, assets are tested at the lowest level for which identifiable independent cash flows are available. An impairment loss is recognized when the sum of projected undiscounted cash flows is less than the carrying value of the asset group. The measurement of the impairment loss to be recognized is based on the difference between the fair value and the carrying value of the asset group. The Company did not recognize an impairment charge on its long-lived assets during the year ended December 31, 2025. The Company recognized an impairment charge on its right of use assets and related furniture and fixtures during the year ended December 31, 2024. Accumulated Other Comprehensive Loss Comprehensive loss is defined as the change in the equity of a business entity during a period from transactions and other events and circumstances from non-owner sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. Comprehensive loss consists of: (i) all components of net loss and (ii) all components of comprehensive loss other than net loss, referred to as other comprehensive loss. Other comprehensive loss is comprised of foreign currency translation adjustments. Collaboration and License Revenue Recognition Revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. Pursuant to ASC Topic 606, Revenue from Contracts with Customers (ASC 606), a customer is a party that has contracted with an entity to obtain goods or services that are an output of the entity’s ordinary activities in exchange for consideration. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract, including whether they are distinct in the context of the contract; (iii) determine the transaction price, including the constraint on variable consideration; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. If a promised good or service is not distinct, it is combined with other promised goods or services into a performance obligation. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Collaboration and License Revenue The Company currently generates its revenue through collaboration and license agreements with strategic collaborators for the development and commercialization of product candidates. Collaboration and license agreements with customers are generally accounted for in accordance with ASC 606. The Company analyzes collaboration arrangements by first assessing whether they are within the scope of ASC Topic 808, Collaborative Arrangements (ASC 808), and evaluates whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards that are dependent on the commercial success of such activities. Collaboration agreements with customers that are not within the scope of ASC 808 are accounted for in accordance with ASC 606. To the extent the collaboration agreement is within the scope of ASC 808, the Company also assesses whether any aspects of the agreement are within the scope of other accounting literature (specifically ASC 606). If the Company concludes that some or all aspects of the agreement are distinct and represent a transaction with a customer, the Company accounts for those aspects of the arrangement within the scope of ASC 606. The Company recognizes the shared costs incurred that are not within the scope of other accounting literature as a component of the related expense in the period incurred by analogy to ASC Topic 730, Research and Development (ASC 730), and records reimbursements from counterparties as an offset to the related research and development costs. In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under the agreements in accordance with ASC 606, the Company performs the five steps above. As part of the accounting for the arrangement, the Company must develop assumptions that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. The Company uses key assumptions to determine the stand-alone selling price, which may include market conditions, reimbursement rates for personnel costs, development timelines and probabilities of regulatory success. The terms of the Company’s arrangements typically include one or more of the following: (i) upfront fees; (ii) milestone payments related to the achievement of development, regulatory, or commercial goals; (iii) royalties on net sales of licensed products; (iv) reimbursements or cost-sharing of research and development expenses; and (v) profit/loss sharing arising from co-promotion arrangements. F-11 Table of Contents Licenses of Intellectual Property If the license to the Company’s intellectual property is determined to be distinct from the other promised goods and services identified in the arrangement, the Company recognizes revenues from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. If not distinct, the license is combined with other promised goods and services in the contract. For licenses that are combined with other promised goods and services, the Company assesses the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Optional licenses are evaluated to determine if they are issued at a discount, and therefore, represent material rights and accounted for as separate performance obligations. Milestone Payments At the inception of each arrangement that includes developmental and regulatory milestone payments, the Company evaluates whether the achievement of each milestone specifically relates to the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service within a performance obligation. If the achievement of a milestone is considered a direct result of the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service and the receipt of the payment is based upon the achievement of the milestone, the associated milestone value is allocated to that distinct good or service. If the milestone payment is not specifically related to the Company’s effort to satisfy a performance obligation or transfer a distinct good or service, the amount is allocated to all performance obligations using the relative standalone selling price method. The Company also evaluates the milestone to determine whether they are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price to be allocated, otherwise, such amounts are constrained and excluded from the transaction price. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development milestones and any related constraint, and if necessary, adjusts its estimate of the transaction price. Any such adjustments to the transaction price are allocated to the performance obligations on the same basis as at contract inception. Amounts allocated to a satisfied performance obligation shall be recognized as revenue, or as a reduction of revenue, in the period in which the transaction price changes. Manufacturing Supply Services Arrangements that include a promise for future supply of drug substance or drug product for either clinical development or commercial supply at the customer’s discretion are evaluated to determine if they are distinct and optional. For optional services that are distinct, the Company assesses if they are priced at a discount, and therefore, provide a material right to the licensee to be accounted for as separate performance obligations. Royalties For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company will recognize revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied) in accordance with the royalty recognition constraint. Grant Revenue The Company has contracts with government-sponsored organizations for research and development related activities that provide for payments for reimbursable costs. The Company recognizes grant revenue from these contracts as it performs services under these arrangements when the funding is committed. Expenses associated with these contracts are recognized when incurred as research and development expense. Grant revenue and related expenses are presented gross in the consolidated statements of operations and comprehensive loss as the Company has determined it is the primary obligor under the arrangements relative to the research and development services it performs as lead technical expert. Amounts incurred that are subject to reimbursement from the sponsor are recorded as accounts receivable on the consolidated balance sheets. Research and Development Costs Costs incurred in the research and development of the Company’s products are expensed as incurred. Research and development expenses include costs incurred in performing research and development activities, including salaries and benefits, stock-based compensation expenses, facilities cost, overhead costs, contract services, supplies and other outside costs. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made. F-12 Table of Contents Clinical Trial Costs Clinical trial expenses are a significant component of research and development expenses, and the Company outsources a significant portion of these costs to third-parties. Third-party clinical trial expenses include patient costs, clinical research organization costs and costs for data management. The accrual for site and patient costs includes inputs such as estimates of patient enrollment, patient cycles incurred, clinical site activations, and other pass-through costs. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected on the consolidated balance sheets as a prepaid asset or accrued clinical trial cost. These third-party agreements are generally cancellable, and related costs are recorded as research and development expenses as incurred. Non-refundable advance clinical payments for goods or services that will be used or rendered for future research and development activities are recorded as a prepaid asset and recognized as expense as the related goods are delivered or the related services are performed. The Company also records accruals for estimated ongoing clinical research and development costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates may be made in determining the accrued balances at the end of any reporting period. Actual results could differ from the estimates made by the Company. The historical clinical accrual estimates made by the Company have not been materially different from the actual costs. Income Taxes The Company provides deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the Company’s financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates expected to be in effect in the years in which the differences are expected to reverse. A valuation allowance is provided to reduce the deferred tax assets to the amount that will more-likely-than-not be realized. The Company determines whether it is more likely than not that a tax position will be sustained upon examination. If it is not more-likely-than-not that a position will be sustained, none of the benefit attributable to the position is recognized. The tax benefit to be recognized for any tax position that meets the more-likely-than-not recognition threshold is calculated as the largest amount that is more than 50% likely of being realized upon resolution of the contingency. The Company accounts for interest and penalties related to uncertain tax positions as part of its provision for income taxes. To date, the Company has not incurred interest and penalties related to uncertain tax positions. Warrants The Company determines the accounting classification of warrants that are issued, as either liability or equity, by first assessing whether the warrants meet liability classification in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity , and then in accordance with ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock . Under ASC 480, warrants are considered liability classified if the warrants are mandatorily redeemable, obligate the issuer to settle the warrants or the underlying shares by paying cash or other assets, or must or may require settlement by issuing variable number of shares. If warrants do not meet liability classification under ASC 480-10, the Company assesses the requirements under ASC 815-40, which states that contracts that require or may require the issuer to settle the contract for cash are liabilities recorded at fair value, irrespective of the likelihood of the transaction occurring that triggers the net cash settlement feature. If the warrants do not require liability classification under ASC 815-40, in order to conclude equity classification, the Company assesses whether the warrants are indexed to its common stock and whether the warrants are classified as equity under ASC 815-40 or other applicable U.S. GAAP. After all relevant assessments are made, the Company concludes whether the warrants are classified as liability or equity. Liability classified warrants are required to be accounted for at fair value both on the date of issuance and on subsequent accounting period ending dates, with all changes in fair value after the issuance date recorded in the statements of operations as a gain or loss. Equity classified warrants are accounted for at fair value on the issuance date with no changes in fair value recognized after the issuance date. Stock-Based Compensation The Company accounts for all stock-based compensation granted to employees and non-employees using a fair value method. Stock-based compensation is measured at the grant date fair value and is recognized over the requisite service period of the awards, usually the vesting period, on a straight-line basis, net of estimated forfeitures. To the extent that actual forfeitures differ from the Company’s estimates, the differences are recorded as a cumulative adjustment in the period the estimates were adjusted. Stock-based compensation expense recognized in the consolidated financial statements is based on awards that ultimately vest. F-13 Table of Contents Net Income (Loss) Per Share The Company applies the two-class method to compute basic and diluted net income (loss) per share attributable to common stockholders when it has issued shares that meet the definition of participating securities. The two-class method determines net income (loss) per share for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income (loss) available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to share in the earnings as if all income (loss) for the period had been distributed. The Company’s Series A Preferred Stock, Series B Preferred Stock and 2022 Warrants, as defined below, participate in any dividends declared by the Company and are therefore considered to be participating securities. The participating securities are not required to participate in the losses of the Company, and therefore during periods of loss there is no allocation required under the two-class method. Basic net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted net income (loss) attributable to common stockholders is computed by adjusting net income (loss) per share attributable to common stockholders to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the diluted net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period, including potentially dilutive common shares. For purposes of this calculation, outstanding options to purchase common stock and Series A Preferred Stock, forward contracts to issue Series A Preferred Stock, restricted stock units, warrants to purchase common stock, contingently issuable shares, Series A Preferred Stock, and Series B Preferred Stock are considered potential dilutive common shares. Contingent Liabilities The Company accounts for its contingent liabilities in accordance with ASC Topic 450, Contingencies (ASC 450). A provision is recorded when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. With respect to legal matters, provisions are reviewed and adjusted to reflect the impact of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. Leases The Company accounts for its leases in accordance with ASC Topic 842, Leases (ASC 842), and determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. Most leases with a term greater than one year are recognized on the balance sheet as right-of-use assets, lease liabilities and, if applicable, long-term lease liabilities. The Company elected not to recognize leases with an original term less than one year on its balance sheet. Operating lease right-of-use assets and their corresponding lease liabilities are recorded based on the present value of lease payments over the expected remaining lease term. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company utilizes its incremental borrowing rates, which are the rates incurred to borrow, on a collateralized basis over a similar term, an amount equal to the lease payments in a similar economic environment. In accordance with the guidance in ASC 842, the fixed and in-substance fixed contract consideration must be allocated to lease and non-lease components based on their relative fair values. Non-components of a contract (e.g., administrative tasks that do not transfer a good or service to the Company, reimbursement or payment of a lessor’s cost, etc.) do not receive an allocation of the consideration in the contract. Although allocation of consideration of lease and non-lease components is required, the Company elected the practical expedient to not separate lease components (e.g. land, building, etc.) and non-lease components (e.g., common area maintenance, consumables, etc.). The lease component results in an operating right-of-use asset being recorded on the balance sheet and amortized on a straight-line basis as lease expense. Right-of-use assets and operating lease liabilities are remeasured upon certain modifications to leases using the present value of remaining lease payments and the estimated incremental borrowing rate upon lease modification. The Company enters into lease agreements with terms generally ranging from two to eight years . Some of the Company’s lease agreements include Company options to either extend and/or early terminate the lease, the costs of which are included in its operating lease liabilities to the extent that such options are reasonably certain of being exercised. Leases with renewal options allow the Company to extend the lease term typically between one and five years . When determining the lease term, renewal options reasonably certain of being exercised are included in the lease term. When determining if a renewal option is reasonably certain of being exercised, the Company considers several economic factors, including but not limited to, the significance of leasehold improvements incurred on the property, whether the asset is difficult to replace, underlying contractual obligations, or specific characteristics unique to that particular lease that would make it reasonably certain that the Company would exercise such option. Renewal and termination options were generally not included in the lease term for the Company’s existing operating leases. Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. F-14 Table of Contents Acquisitions The Company evaluates acquisitions of assets and other similar transactions to assess whether or not the transaction should be accounted for as a business combination or asset acquisition by first applying a screen to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If the screen is met, the transaction is accounted for as an asset acquisition. If the screen is not met, further determination is required as to whether or not the Company has acquired inputs and processes that have the ability to create outputs, which would meet the requirements of a business. If determined to be a business combination, the Company accounts for the transaction under the acquisition method of accounting which requires the acquiring entity in a business combination to recognize the fair value of all assets acquired, liabilities assumed, and any non-controlling interest in the acquiree and establishes the acquisition date as the fair value measurement point. Accordingly, the Company recognizes assets acquired and liabilities assumed in business combinations based on the fair value estimates as of the date of acquisition. In accordance with ASC Topic 805, Business Combinations (ASC 805) the Company recognizes and measures goodwill as of the acquisition date, as the excess of the fair value of the consideration paid over the fair value of the identified net assets acquired. Goodwill Goodwill represents the amount of consideration paid in excess of the fair value of the identified net assets acquired as a result of the Company’s business acquisitions accounted for using the acquisition method of accounting. Goodwill is not amortized and is subject to impairment testing at a reporting unit level on an annual basis or when a triggering event occurs that may indicate the carrying value of the goodwill is impaired. An entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Such qualitative factors include macroeconomic conditions, industry and market considerations, cost factors, overall financial performance and other relevant events. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. The Company evaluates goodwill for impairment at least annually on October 1, or the Assessment Date, and whenever facts and circumstances indicate that their carrying amounts may not be recoverable. For the years ended December 31, 2025 and 2024, the Company determined that there was no impairment to goodwill. Indefinite-Lived Intangible Assets Indefinite-lived intangible assets consist of in-process research and development, or IPR&D. The fair values of IPR&D assets acquired in business combinations are capitalized. These assets are treated as indefinite-lived intangible assets until completion or abandonment of the projects, at which time the assets are amortized over the remaining useful life or written off, as appropriate. Intangible assets with indefinite lives, including IPR&D, are tested for impairment if impairment indicators arise and, at a minimum, annually. However, an entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that an indefinite-lived intangible asset’s fair value is less than its carrying amount. Otherwise, no further impairment testing is required. The indefinite-lived intangible asset impairment test consists of a one-step analysis that compares the fair value of the intangible asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. The Company considers many factors in evaluating whether the value of its intangible assets with indefinite lives may not be recoverable, including, but not limited to, expected growth rates, the cost of equity and debt capital, general economic conditions, the Company’s outlook and market performance of the Company’s industry and recent and forecasted financial performance. The Company evaluates indefinite-lived intangible assets for impairment at least annually on the Assessment Date, and whenever facts and circumstances indicate that their carrying amounts may not be recoverable. During the year ended December 31, 2025, the Company recorded a $ 56.7 million impairment related to its IPR&D asset related to Descartes-08 in systemic lupus erythematosus, or SLE. There was no impairment recorded for the year ended December 31, 2024. See Note 3, “Goodwill and Indefinite-Lived Intangible Assets” for more information. Convertible Preferred Stock The Company records its convertible preferred stock upon issuance at its fair value. The fair value includes the original issuance price, the settlement of any related forward contract, and is less issuance costs. The Company classifies its convertible preferred stock outside of stockholders’ deficit if the redemption of such shares is outside the Company’s control. For shares classified outside of stockholders’ deficit, the Company does not adjust the carrying value of its convertible preferred stock to redemption value until it is probable of becoming redeemable. As of December 31, 2025 and 2024, there were no conditions F-15 Table of Contents that could have required cash redemption of the convertible preferred stock and therefore, all convertible preferred stock were classified within stockholders’ deficit. Series A Preferred Stock Options The Company classifies a portion of the fair value of the vested stock options for Series A Preferred Stock equal to the estimated redemption value on the measurement date outside of stockholders’ deficit, if the redemption of the shares underlying the options are outside the Company’s control. Any fair value in excess of the estimated redemption value is recognized as additional paid-in capital. The estimated redemption value is based on the intrinsic value of the option. The Company does not adjust the carrying value of the stock options for Series A Preferred Stock until the underlying Series A Preferred Stock is probable of becoming redeemable. The Company records the stock options for Series A Preferred Stock based on the intrinsic value of the vested options. Variable Interest Entities The Company evaluates its variable interests in variable interest entities, or VIEs, and consolidates VIEs when the Company is the primary beneficiary. The Company determines whether it is the primary beneficiary of a VIE based on its assessment of whether the Company possesses both (i) the power to direct the activities that most significantly affect the VIE’s economic performance and (ii) the obligation to absorb losses that could be significant to the VIE or the right to receive benefits that could be significant to the VIE. The Company reevaluates the accounting for its VIEs upon the occurrence of events that could change the primary beneficiary conclusion. The Company determined that it was more likely than not that its investment in Cyrus was unrecoverable. Therefore, the Company recorded an impairment on its investment of $ 2.0 million during the year ended December 31, 2025. There was no impairment on investment during the year ended December 31, 2024. See Note 4, “Investment” for more details. Contingent Value Right Liability The CVRs distributed by the Company pursuant to the terms of the CVR Agreement (as defined below) represent financial instruments that are accounted for under the fair value option election in ASC Topic 825, Financial Instruments (ASC 825). Under the fair value option election, the CVRs are initially measured at the aggregate estimated fair value of the CVRs and will be subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The estimated fair value of the CVR liability is determined using a Monte Carlo simulation method to estimate future cash flows associated with the legacy assets, including the expected milestone and royalty payments under the Sobi License, net of deductions. Changes in fair value of the liability are presented in the consolidated statements of operations and comprehensive loss. The fair value of the liability is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of success and expected volatilities of revenues, which represent Level 3 measurements within the fair value hierarchy. Forward Contract Liabilities The Company accounts for contracts related to the future issuance of its common stock or convertible preferred stock as a liability if the underlying shares include a redemption feature that may require the Company to settle the instrument by transferring an asset. A forward contract liability is carried at fair value through the date the underlying shares are issued. Subsequent measurement of the fair value of a forward contract liability is based on the market price of the Company’s common stock, which represent Level 2 inputs within the fair value hierarchy as it’s based on observable market data. Changes in fair value of the liability are presented within change in fair value of forward contract liabilities in the consolidated statements of operations and comprehensive loss. Recent Accounting Pronouncements Recently Adopted In December 2023, the FASB, issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. The Company adopted the new standard during the year ended December 31, 2025 and the amendment has been applied prospectively. See Note 16, “Income Taxes” for additional information. Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement Reporting- Comprehensive Income- Expense Disaggregation Disclosures (ASU 2024-03), which requires public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in notes to financial statements, including purchases of inventory, F-16 Table of Contents employee compensation, depreciation, amortization of intangible assets, and selling expenses. This guidance will be effective for the annual period beginning the year ended December 31, 2027 and for interim periods beginning January 1, 2028, with early adoption permitted. The Company is currently in the process of evaluating the impact of the standard’s adoption on its consolidated financial statements and related disclosures. In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities (ASU 2025-10), which establishes authoritative guidance on the recognition, measurement, presentation, and disclosure of government grants. Under ASU 2025-10, government grants are recognized when it is probable that the entity will both comply with the conditions of the grant and the grant will be received. The ASU provides specific accounting models for grants related to assets and grants related to income, including options to recognize government grants as deferred income or as a reduction of the asset’s cost basis. The ASU also requires enhanced disclosures regarding the nature of government grants, significant terms and conditions, accounting policies applied, and amounts recognized in the financial statements. ASU 2025-10 is effective for fiscal years beginning after December 15, 2028, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-10 on its consolidated financial statements and related disclosures. In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements (ASU 2025-11), which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting. The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-11 on its consolidated financial statements and related disclosures. 3. Goodwill and Indefinite-Lived Intangible Assets On November 13, 2023, the Company merged with Old Cartesian in accordance with the terms of the Merger Agreement. See Note 1, “Description of the Business” for more information. In connection with Merger, the Company recorded goodwill of approximately $ 48.2 million and total indefinite-lived intangible assets of $ 150.6 million, of which $ 93.9 million is related to Descartes-08 for MG and $ 56.7 million is related to Descartes-08 for SLE. Indefinite-Lived Intangible Assets The Company assesses its intangible assets, consisting of IPR&D related to Descartes-08 for MG and Decartes-08 for SLE, for impairment at least annually on the Assessment Date or whenever facts and circumstances indicate that their carrying amounts may not be recoverable. When testing IPR&D for impairment, the Company may assess qualitative factors for its IPR&D to determine whether it is more likely than not that the fair value of its indefinite-lived assets are less than its carrying amount. The qualitative assessment includes the Company’s consideration of relevant events and circumstances that would affect the Company’s indefinite-lived assets, including macroeconomic, industry and market conditions as well as the Company’s financial performance. For the annual impairment review during the year ended December 31, 2025, the Company performed a qualitative assessment and determined a quantitative impairment test for both indefinite-lived assets was required, whereas only a qualitative assessment was performed during the year ended December 31, 2024. As a part of the quantitative impairment test of the Company’s IPR&D assets as of the Assessment Date, an extensive valuation analysis was performed to determine the fair value of the Company’s IPR&D assets using a discounted cash flow approach. The estimates and assumptions used in the discounted cash flow approach are Level 3 inputs and primarily include, but are not limited to, projected revenue, the discount rate, control premiums and probability of success. Based on the analysis performed, the estimated fair value of the Company’s IPR&D assets exceeded their respective carrying value as of the Assessment Date and therefore, there was no impairment to IPR&D assets. On November 13, 2025 the Company announced a pause in further development of Descartes-08 in SLE, following which it made a further decision that it would no longer pursue the development of Descartes-08 in SLE, or the Triggering Event. As the result of the Triggering Event, the Company re-evaluated its IPR&D asset related to Descartes-08 for SLE. Following this assessment, the Company found that the related IPR&D asset was fully impaired. Therefore, the Company recorded a $ 56.7 million impairment charge to the IPR&D asset related to Decartes-08 for SLE within “Impairment of indefinite-lived intangible and long-lived assets” in the consolidated statements of operations and comprehensive loss during the year ended December 31, 2025. The Triggering Event had no impact on Descartes-08 for MG and therefore no impairment with respect to Descartes-08 in MG was recorded. There were no impairments recorded during the year ended December 31, 2024. F-17 Table of Contents Goodwill The Company assesses its goodwill for impairment at the reporting unit level at least annually on the Assessment Date and whenever facts and circumstances indicate that their carrying amounts may not be recoverable. When testing goodwill for impairment, the Company may assess qualitative factors for its reporting unit to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. Alternatively, the Company may bypass this qualitative assessment and perform the quantitative goodwill impairment test. As a part of the quantitative impairment test of the Company’s goodwill as of the Assessment Date, an extensive valuation analysis was performed to determine the fair value of the Company’s reporting unit using a discounted cash flow approach. The estimates and assumptions used in the discounted cash flow approach are Level 3 inputs and primarily include, but are not limited to, projected revenue, the discount rate, control premiums and probability of success. Based on the analysis performed, the estimated fair value of the Company’s reporting unit exceeded the carrying value as of the Assessment Date, and therefore, there was no impairment to goodwill. As the result of Triggering Event described above, the Company re-evaluated its goodwill for impairment. The Company used the same valuation approach used as of the Assessment Date, with changes made to estimates and assumptions based on the new facts and circumstances as of the Triggering Event. Based on the analysis performed, the estimated fair value of the Company’s reporting unit exceeded the carrying value, and therefore, there was no impairment to goodwill. There were no changes to the carrying value of the Company’s goodwill during the years ended December 31, 2025 and 2024. 4. Investment In 2021, the Company and Cyrus Biotechnology, Inc., or Cyrus, entered into a stock purchase agreement, or the Series B Preferred Stock Purchase Agreement. Pursuant to the Series B Preferred Stock Purchase Agreement, the Company purchased 2,326,934 shares of Cyrus’ Series B Preferred Stock, par value $ 0.0001 per share, at a purchase price of $ 0.8595 per share, for $ 2.0 million. In accordance with ASC 810, the Company has a variable interest in Cyrus resulting from its equity investment. The Company will share in Cyrus’ expected losses or receive a portion of its expected returns and absorb the variability associated with changes in the entity’s net assets. However, the Company is not the primary beneficiary as it does not have the power to direct the activities most significant to Cyrus, and therefore it is not required to consolidate Cyrus. The Company recognized the $ 2.0 million investment of Cyrus’ Series B Preferred Stock at cost on the purchase date. The Company has not provided financing to Cyrus other than the amount contractually required by the Series B Preferred Stock Purchase Agreement. The Company evaluates its investment for impairment whenever events or changes in circumstances indicate that the carrying amount of such investment may be impaired. If a decline in value of the investment is determined to be other than temporary, an impairment loss is recognized in other (expense) income, net in the consolidated statements of operations and comprehensive loss. During the year ended December 31, 2025, the Company determined that it was more likely than not that its investment in Cyrus was unrecoverable. Therefore, the Company recorded an impairment on its investment of $ 2.0 million and there is no carrying value as of December 31, 2025 . 5. Net Loss Per Share Allocable to Common Stockholders The Company reported a net loss for the years ended December 31, 2025 and 2024. The Company used the treasury stock method to determine the number of dilutive shares for the year ended December 31, 2024. The following table sets forth the F-18 Table of Contents computation of basic and diluted net loss per share allocable to common stockholders (in thousands, except share and per-share data): Year Ended December 31, 2025 2024 Numerator: Net loss allocable to shares of common stock - basic ( 130,302 ) ( 77,424 ) Less: Change in fair value of forward contract liability settled in February 2024 — ( 446 ) Net loss allocable to shares of common stock - diluted $ ( 130,302 ) $ ( 77,870 ) Denominator: Weighted-average common shares outstanding - basic 25,973,329 17,276,822 Plus: Dilutive effect of forward contract liability settled in February 2024 — 81,121 Weighted-average common shares outstanding - diluted 25,973,329 17,357,943 Net loss per share: Basic $ ( 5.02 ) $ ( 4.48 ) Diluted $ ( 5.02 ) $ ( 4.49 ) The following table represents the potential dilutive shares of common stock excluded from the computation of the diluted net loss per share allocable to common stockholders for all periods presented, as the effect would have been anti-dilutive: Year Ended December 31, 2025 2024 Common stock options and restricted stock units 2,993,745 2,150,273 Warrants to purchase common stock 692,272 692,523 Series A Preferred Stock 4,026,346 4,026,346 Series B Preferred Stock 437,927 437,927 Total 8,150,290 7,307,069 6. Fair Value Measurements The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2025 and 2024 (in thousands): December 31, 2025 Total Level 1 Level 2 Level 3 Assets: Money market funds (included in cash equivalents) $ 122,724 $ 122,724 $ — $ — Total $ 122,724 $ 122,724 $ — $ — Liabilities: Warrant liability $ 141 $ — $ — $ 141 Contingent value right liability 392,100 — — 392,100 Total $ 392,241 $ — $ — $ 392,241 December 31, 2024 Total Level 1 Level 2 Level 3 Assets: Money market funds (included in cash equivalents) $ 39,088 $ 39,088 $ — $ — Total $ 39,088 $ 39,088 $ — $ — Liabilities: Warrant liability $ 3,836 $ — $ — $ 3,836 Contingent value right liability 395,500 — — 395,500 Total $ 399,336 $ — $ — $ 399,336 F-19 Table of Contents There were no transfers within the fair value hierarchy during the years ended December 31, 2025 and 2024. Cash, Cash Equivalents, and Restricted Cash As of December 31, 2025 and 2024, money market funds were classified as cash and cash equivalents on the accompanying consolidated balance sheets as they mature within 90 days from the date of purchase. As of December 31, 2025, the Company had restricted cash balances relating to secured letters of credit in connection with its real estate leases (see Note 9, “Leases”). The Company’s consolidated statement of cash flows includes the following as of December 31, 2025 and 2024 (in thousands): Year Ended December 31, 2025 2024 Cash and cash equivalents $ 125,139 $ 212,610 Long-term restricted cash 1,735 1,669 Total cash, cash equivalents, and restricted cash $ 126,874 $ 214,279 Warrants to Purchase Common Stock In December 2019, the Company issued warrants to purchase common stock in connection with a private placement, or the 2019 Warrants. The outstanding 2019 Warrants expired on December 23, 2024 in accordance with their terms. Pursuant to the terms of the 2019 Warrants, the Company could have been required to settle the 2019 Warrants in cash in the event of certain acquisitions of the Company and, as a result, the 2019 Warrants were required to be measured at fair value and reported as a liability on the balance sheet. On December 20, 2022, the Company amended the terms of the outstanding 2019 Warrants held by certain members of the Board of Directors, or the Amended 2019 Warrants, to remove the cash settlement provision. As a result, the Amended 2019 Warrants were remeasured at fair value on December 20, 2022 and reclassified from a liability to equity on the balance sheet. See Note 11, “Equity” for further discussion on the equity-classified Amended 2019 Warrants. In April 2022, the Company issued warrants in connection with an underwritten offering, or the 2022 Warrants. Pursuant to the terms of the 2022 Warrants, the Company could be required to settle the 2022 Warrants in cash in the event of an acquisition of the Company under certain circumstances and, as a result, the 2022 Warrants are required to be measured at fair value and reported as a liability on the balance sheet. The Company recorded the fair value of the 2019 Warrants and the 2022 Warrants upon issuance using the Black-Scholes valuation model and is required to revalue the 2019 Warrants and the 2022 Warrants at each reporting date, with any changes in fair value recorded in the consolidated statements of operations and comprehensive loss. The valuations of the 2019 Warrants and the 2022 Warrants are classified as Level 3 of the fair value hierarchy due to the need to use assumptions in the valuations that are both significant to the fair value measurement and unobservable, including the stock price volatility and the expected life of the 2019 Warrants and the 2022 Warrants. Generally, increases (decreases) in the fair value of the underlying stock and estimated term would result in a directionally similar impact to the fair value measurement. The changes in the fair values of the warrants are reflected in the consolidated statements of operations and comprehensive loss for the years ended December 31, 2025 and 2024. The estimated fair values of the 2019 Warrants and the 2022 Warrants were determined using the following inputs to the Black-Scholes simulation valuation: • Estimated fair value of the underlying stock. The Company estimates the fair value of the common stock based on the closing stock price at the end of each reporting period. • Risk-free interest rate. The risk-free interest rate is based on the U.S. Treasury at the valuation date commensurate with the expected remaining life assumption. • Dividend rate. The dividend rate is based on the historical rate, which the Company anticipates will remain at zero . • Expected life. The expected life of the 2019 Warrants was assumed to be equivalent to their remaining contractual term which expired on December 23, 2024. The expected life of the 2022 Warrants is assumed to be equivalent to their remaining contractual term which expires on April 11, 2027. • Volatility. The Company estimates stock price volatility based on the Company’s historical volatility for a period of time commensurate with the expected remaining life of the warrants. F-20 Table of Contents The 2019 Warrants expired on December 23, 2024 and therefore, there were no 2019 Warrants outstanding as of December 31, 2025 or 2024. A summary of the Black-Scholes pricing model assumptions used to record the fair value of the 2022 Warrants liability is as follows: December 31, 2025 2024 Risk-free interest rate 3.48 % 4.25 % Dividend yield — — Expected life (in years) 1.28 2.28 Expected volatility 87.36 % 92.92 % The following table reflects a roll-forward of fair value for the Company’s Level 3 warrant liability (see Note 11, “Equity”), for the year ended December 31, 2025 (in thousands): Warrant liability Fair value as of December 31, 2024 $ 3,836 Change in fair value ( 3,695 ) Fair value as of December 31, 2025 $ 141 Contingent Value Right On December 6, 2023, as contemplated by the Merger Agreement, the Company entered into a contingent value rights agreement, or the CVR Agreement, pursuant to which each holder of common stock or a 2022 Warrant as of December 4, 2023 was distributed a CVR, issued by the Company for each share of common stock held directly or underlying a 2022 Warrant held by such holder as of December 4, 2023. Holders of warrants other than the 2022 Warrants will be entitled to receive, upon exercise of such warrants and in accordance with the terms of the warrants, 30 CVRs per each share of common stock underlying such warrants. Each CVR entitles its holder to distributions of the following, pro-rated on a per-CVR basis, during the period ending on the date on which the Royalty Term (as defined in the Sobi License) ends, or the Termination Date: • 100 % of all milestone payments, royalties and other amounts paid to the Company or its controlled affiliates, or the Company Entities, under the Sobi License or, following certain terminations of the Sobi License, any agreement a Company Entity enters into that provides for the development and commercialization of Nanoecapsulated Sirolimus plus Pegadricase, or NASP, formerly known as SEL-212; and • 100 % of all cash consideration and the actual liquidation value of any and all non-cash consideration of any kind that is paid to or is actually received by any Company Entity prior to the Termination Date pursuant to an agreement relating to a sale, license, transfer or other disposition of any transferable asset of the Company existing as of immediately prior to the Merger, other than those exclusively licensed under the Sobi License or which the Company Entities are required to continue to own in order to comply with the Sobi License. The distributions in respect of the CVRs will be made on a semi-annual basis, and will be subject to a number of deductions, subject to certain exceptions or limitations, including for (i) certain taxes payable on the proceeds subject to the CVR distribution, (ii) certain out of pocket costs incurred by the Company Entities, including audit and accounting fees incurred in connection with reporting obligations relating to the CVRs and other expenses incurred in the performance of their obligations and other actions under the CVR Agreement, (iii) a fixed semi-annual amount of $ 0.75 million for general and administrative overhead, (iv) payments made and remaining obligations on lease liabilities of Selecta immediately prior to the Merger and (v) amounts paid and remaining obligations with regard to the Xork product candidate. Each of the deductions described in (iv) and (v) will be made only if certain milestone payments under the Sobi License are made and are also subject to certain adjustments as contemplated in the CVR Agreement. Upon the achievement of a development milestone in June 2024, Sobi became obligated to make a $ 30.0 million payment to the Company and made such payment in July 2024. The proceeds from this payment, net of deductions specified in the CVR Agreement, were included in the scheduled distribution to the holders of the CVR in March 2025. The CVRs represent financial instruments that are accounted for under the fair value option election in ASC 825. Under the fair value option election, the CVRs were initially measured at the aggregate estimated fair value of the CVRs and will be F-21 Table of Contents subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The liability was recorded at the date of approval, November 13, 2023, as a dividend. The estimated fair value of the CVR liability was determined using a Monte Carlo simulation model as of December 31, 2025 and 2024 to estimate future cash flows associated with the legacy assets, including the expected milestone and royalty payments under the Sobi License, net of deductions. Changes in fair value of the CVR liability are presented in the consolidated statements of operations and comprehensive loss. The fair value of the liability is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of success, and expected volatility of future revenues, which represent Level 3 measurements within the fair value hierarchy. The significant inputs used to estimate the fair value of the CVR liability, which represented a financial instrument being accounted for under the fair value option, were as follows: December 31, 2025 2024 Estimated cash flow dates 2026 - 2037 2025 - 2038 Estimated probability of success 95.0 % - 100.0 % 95.0 % - 100.0 % Expected volatility of future revenues 23.0 % 22.0 % The following table reflects a roll-forward of fair value for the Company’s Level 3 CVR liability for the year ended December 31, 2025 (in thousands): CVR liability Fair value as of December 31, 2024 $ 395,500 Distributions ( 7,754 ) Change in fair value 4,354 Fair value as of December 31, 2025 $ 392,100 Forward Contract Liabilities The Company entered into a contract for the issuance of 149,330.115 shares of Series A Preferred Stock as part of the 2023 Private Placement which was settled in multiple tranches. The Company determined the obligation to issue 148,710.488 shares of Series A Preferred Stock to Timothy A. Springer, Ph.D., a member of the Company’s Board of Directors, and TAS Partners LLC, an affiliate of Dr. Springer, represented a forward contract. See Note 10, “Convertible Preferred Stock.” The initial fair value of the forward contract liability on November 13, 2023 was insignificant as the fair value of the underlying Series A Preferred Stock was equal to the purchase price of the Series A Preferred Stock as agreed upon in the 2023 Private Placement. Subsequent measurement of the fair value of the forward contract liability was based on the market price of the Company’s common stock, which represented the redemption and conversion value of the Series A Preferred Stock, less the purchase price, on an as-converted basis. The non-cash settlement of a portion of the liability occurred on December 13, 2023 with the issuance of the first tranche of the Series A Preferred Stock for $ 14.8 million. The non-cash settlement of the remaining second and third tranches occurred on January 12, 2024 and February 11, 2024, respectively, for a total of $ 35.2 million. 7. Property and Equipment Property and equipment consists of the following (in thousands): December 31, 2025 2024 Laboratory equipment $ 8,419 $ 7,295 Computer equipment and software 417 415 Leasehold improvements 4,177 3,427 Furniture and fixtures 269 268 Office equipment 170 169 Construction in process 3,466 695 Total property and equipment 16,918 12,269 Less: Accumulated depreciation ( 4,733 ) ( 2,357 ) Property and equipment, net $ 12,185 $ 9,912 F-22 Table of Contents See Note 9, “Leases” for details regarding the impairment loss the Company recognized for certain furniture and fixtures during the year ended December 31, 2024. Depreciation expense was $ 2.4 million and $ 1.2 million for the years ended December 31, 2025 and 2024, respectively. 8. Accrued Expenses Accrued expenses consist of the following (in thousands): December 31, 2025 2024 Payroll and employee related expenses $ 3,985 $ 3,534 Collaboration and licensing 320 55 Accrued patent fees 205 813 Accrued research and development costs 2,521 2,987 Accrued professional and consulting services 2,059 3,674 Property and equipment 18 782 Other 390 231 Accrued expenses $ 9,498 $ 12,076 9. Leases 7495 New Horizon Way Leases On February 28, 2024, the Company entered into a lease agreement with 7495 RP, LLC, or the Landlord, pursuant to which it agreed to lease from the Landlord the manufacturing space located at 7495 New Horizon Way, Frederick, Maryland, or the Frederick Lease Agreement. The space consists of 19,199 leasable square feet of integrated manufacturing and office space. The lease commenced on May 1, 2024 which was the date the Landlord delivered full possession of the premises to the Company. The Frederick Lease Agreement will terminate approximately 7.2 years following the commencement date. The Company will have one option to extend the term of the Frederick Lease Agreement for a period of five years at a cost of 100 % of the then-fair market value, not to exceed 103 % of the then-current base rent. Base rent, which was due beginning on July 1, 2024, is $ 0.9 million annually and is subject to an annual upward adjustment of 3 % of the then-current rental rate. In addition, the Company is obligated to pay its share of operating costs and taxes related to the property. The Company paid the first month’s rent of $ 0.1 million upon execution of the Frederick Lease Agreement. The Company assessed the classification of the lease at the commencement date and concluded it should be accounted for as an operating lease. The Company recorded a lease liability and right-of-use asset of $ 3.6 million and $ 3.7 million, respectively, on the commencement date. The Frederick Lease Agreement includes a tenant improvement allowance of up to $ 0.7 million which was recognized as a reduction in the right-of-use asset and lease liability at the commencement date as the Company was reasonably certain to incur reimbursable costs related to alterations equal to or exceeding the amount. Additionally, the prepaid rent was included as an adjustment to the right-of-use asset. The discount rate of 14 % was determined based on the Company’s incremental borrowing rate adjusted for the lease term, including any reasonably certain renewal periods. Effective May 7, 2024, the Company and the Landlord entered into the first amendment to the Frederick Lease Agreement, or the First Frederick Lease Agreement Amendment, providing for the expansion of the premises leased pursuant to the Frederick Lease Agreement by approximately 7,842 square feet. In connection with the expansion of the leased premises, the Company is obligated to pay $ 0.3 million in additional annual base rent for the first year of the term, which is subject to an annual upward adjustment of 3 % of the then-current rental rate, as well as its share of operating costs and taxes. The lease commenced on May 7, 2024 which was the date the Landlord delivered full possession of the premises to the Company and will be coterminous with the Frederick Lease Agreement. The rent commencement date was September 1, 2024. The Company assessed the classification of the lease at the commencement date and concluded it should be accounted for as an operating lease. The Company recorded a lease liability and right-of-use asset each of $ 1.2 million on the commencement date. The First Frederick Lease Agreement Amendment includes a tenant improvement allowance of up to $ 0.1 million which was recognized as a reduction in the right-of-use asset and lease liability at the commencement date as the Company was reasonably certain to incur reimbursable costs related to alterations equal to or exceeding the amount. The discount rate of 14 % was determined based on the Company’s incremental borrowing rate adjusted for the lease term. F-23 Table of Contents Effective August 30, 2024, the Company and the Landlord entered into the second amendment to the Frederick Lease Agreement, or the Second Frederick Lease Agreement Amendment, providing for the expansion of the premises leased pursuant to the Frederick Lease Agreement and First Frederick Lease Agreement Amendment by approximately 2,009 square feet. In connection with the expansion of the leased premises, the Company is obligated to pay $ 0.1 million in additional annual base rent for the first year of the term, which is subject to an annual upward adjustment of 3 % of the then-current rental rate, as well as its share of operating costs and taxes. The lease commenced on September 1, 2024, which was the date the Landlord delivered full possession of the premises to the Company and will be coterminous with the Frederick Lease Agreement. The rent commencement date was September 1, 2024. The Company assessed the classification of the lease at the commencement date and concluded it should be accounted for as an operating lease. The Company recorded a lease liability and right-of-use asset each of $ 0.3 million on the commencement date. The discount rate of 14 % was determined based on the Company’s incremental borrowing rate adjusted for the lease term. On March 13, 2025, the Company and the Landlord entered into the third amendment to the Frederick Lease Agreement, or the Third Frederick Lease Agreement Amendment, providing for the expansion of the premises leased pursuant to the Frederick Lease Agreement, First Fredrick Lease Agreement Amendment and Second Fredrick Lease Agreement Amendment by approximately 6,439 square feet. In connection with the expansion of the leased premises, the Company is obligated to pay $ 0.2 million in additional annual base rent for the first year of the term, which is subject to an annual upward adjustment of 3 % of the then-current rental rate, as well as its share of operating costs and taxes. The lease commenced on November 1, 2025, which was the date the Landlord delivered full possession of the premises to the Company and will be coterminous with the Frederick Lease Agreement. The Company assessed the classification of the lease at the commencement date and concluded it should be accounted for as an operating lease. The Company recorded a lease liability and right-of-use asset each of $ 0.8 million on the commencement date. The discount rate of 14 % was determined based on the Company’s incremental borrowing rate adjusted for the lease term. The Company secured a letter of credit from Silicon Valley Bank, a division of First-Citizens Bank & Trust Company (successor by purchase to the Federal Deposit Insurance Corporation as Receiver for Silicon Valley Bridge Bank, N.A. (as successor to Silicon Valley Bank)), or SVB, for $ 0.3 million for the Frederick Lease Agreement, the First Frederick Lease Agreement Amendment, the Second Frederick Lease Agreement Amendment and the Third Frederick Lease Agreement Amendment which is recognized as long-term restricted cash as of December 31, 2025, and 2024 and renews automatically each year. 65 Grove Street Lease In July 2019, the Company entered into a lease with BRE-BMR Grove LLC for 25,078 square feet of laboratory and office space located at 65 Grove Street, Watertown, Massachusetts, or the Watertown Lease Agreement. As part of the Watertown Lease Agreement, the Company incurred $ 0.8 million in non-reimbursable construction costs. The lease began in March 2020, when the Company took control of the office space, and the lease term is 8 years. The discount rate of 8.9 % was determined based on the Company’s incremental borrowing rate adjusted for the lease term, including any reasonably certain renewal periods. In connection with the Watertown Lease Agreement, the Company secured a letter of credit from SVB for $ 1.6 million. On September 1, 2022, the Company entered into an amendment, or the Watertown Lease Agreement Amendment, to its lease agreement with BRE-BMR Grove LLC, originally entered into on July 23, 2019 to expand the Company’s laboratory and office space located at 65 Grove Street, Watertown, Massachusetts by 7,216 square feet. The lease term began on September 1, 2022, consistent with when the Company took control of the office space and the expected lease term is 5.7 years. The discount rate of 11.3 % was determined based on the Company’s incremental borrowing rate adjusted for the lease term including any reasonably certain renewal periods. Rent payments began in November 2022, and the base rent for the first year is $ 0.1 million per month. The Company recorded the right-of-use asset and operating lease liabilities of $ 3.2 million during the year ended December 31, 2022 as control of the premises was transferred to the Company. On October 6, 2022, the Company entered into a sublease agreement to sublease 7,216 square feet of space currently rented by the Company at 65 Grove Street, Watertown, Massachusetts. The sublease commenced on October 24, 2022, when the Company, the sublessee and BRE-BMR Grove LLC, executed a Consent to Sublease. The term of the sublease expired on March 31, 2024 with no option to extend the sublease term. Sublease income is included within other income, net in the consolidated statements of operations and comprehensive loss. As a result of the sublease agreement and Consent to Sublease, rent payments to BRE-BMR Grove LLC for the lease of the office space increased. The change of consideration in the contract was accounted for as a lease modification and the right-of-use asset and lease liability were remeasured at the modification date of October 24, 2022. The discount rate of 11.9 % was determined based on the Company’s incremental borrowing rate adjusted for the lease term including any reasonably certain F-24 Table of Contents renewal periods as of October 24, 2022, resulting in a decrease of less than $ 0.1 million to both the right-of-use asset and lease liabilities. In May 2023, the Company received notice from BRE-BMR Grove LLC that the requirements to reduce the amount of the letter of credit for the Watertown Lease Agreement had been met. In connection therewith, in June 2023, the Company secured a letter of credit from JPMorgan Chase Bank, N.A. for $ 1.4 million, which is recognized as long-term restricted cash as of December 31, 2025 and 2024, and renews automatically each year. On October 31, 2023, in connection with entering into Amendment No. 1 to the License and Development Agreement with Sobi as described in Note 13 “Revenue Arrangements,” the Company entered into a sublease agreement with Sobi to sublease approximately 5,600 square feet of space currently rented by the Company at 65 Grove Street, Watertown, Massachusetts for which Sobi paid $ 1.0 million upfront rental payment. The sublease commenced on November 6, 2023, when the Company, Sobi, and BRE-BMR Grove LLC, executed a Consent to Sublease. The term of the sublease expired on November 5, 2024 with no option to extend the sublease term. As a result of the expiration of the sublease to Sobi in November 2024 and the Company’s decision to cease use of its office and laboratory space at 65 Grove Street, Watertown, Massachusetts, the Company assessed the right-of-use assets and related furniture and fixtures associated with the Watertown Lease Agreement and Watertown Lease Agreement Amendment for impairment. The carrying value of each asset group was compared against the future net undiscounted cash flows projected to be generated over the remaining lease terms. These projections included management's estimates of cash inflows from potential sublease income. The carrying amount of the asset groups was found to be unrecoverable, thus the Company assessed the fair value of each asset group. The fair value was determined using the income approach, whereby the Company discounted the estimated net cash flows using a rate commensurate with the Company’s estimated incremental borrowing rate. As a result of this assessment, which included unrecoverable operating and maintenance costs, the Company determined that each asset group was fully impaired. As such, an impairment charge of $ 7.6 million was recognized during the year ended December 31, 2024 within “Impairment of indefinite-lived intangible and long-lived assets” in the consolidated statements of operations and comprehensive loss, $ 7.4 million of which related to the right-of-use assets and $ 0.2 million related to property and equipment. 704 Quince Orchard Road Leases In connection with the Merger, the Company acquired two operating leases for office and laboratory space in Gaithersburg, Maryland. The leases expire in January 2027 and do not contain any renewal rights. The discount rate of 11.5 % was determined based on the Company’s incremental borrowing rate adjusted for the lease term. F-25 Table of Contents Rent expense for the years ended December 31, 2025 and 2024 was $ 4.2 million and $ 5.5 million, respectively. For the years ended December 31, 2025 and 2024, the components of lease costs were as follows (in thousands): Year Ended December 31, 2025 2024 Operating lease cost $ 2,287 $ 3,856 Variable lease cost 1,724 1,609 Short-term lease cost 221 28 Less sublease income — ( 1,099 ) Total lease cost $ 4,232 $ 4,394 The maturity of the Company’s operating lease liabilities as of December 31, 2025 were as follows (in thousands): December 31, 2025 2026 $ 4,740 2027 4,554 2028 2,529 2029 1,630 2030 1,679 Thereafter 852 Total future minimum lease payments 15,984 Less: Imputed interest ( 3,308 ) Total operating lease liabilities $ 12,676 The supplemental disclosure for the statement of cash flows related to operating leases were as follows (in thousands): December 31, 2025 2024 Cash paid for amounts included in the measurement of lease liabilities: $ 3,662 $ 3,559 Other than the initial recording of the right-of-use assets and lease liabilities for the Third Fredrick Lease Amendment during year ended December 31, 2025, and the Frederick Lease Agreement, First Frederick Lease Agreement Amendment, the Second Frederick Lease Agreement Amendment and impairment on the right-of-use assets for the Watertown Lease Agreement and Watertown Lease Agreement Amendment during the year ended December 31, 2024, which were non-cash, the changes in the Company’s right-of-use assets and lease liabilities for the years ended December 31, 2025 and 2024 are reflected in the non-cash lease expense and accrued expenses and other liabilities, respectively, in the consolidated statements of cash flows. The following summarizes additional information related to the Company’s operating leases: December 31, 2025 2024 Weighted-average remaining lease term 3.9 years 4.5 years Weighted-average discount rate 12.1 % 11.7 % 10. Convertible Preferred Stock Series B Preferred Stock The Certificate of Designation of Preferences, Rights, and Limitations of the Series B Non-Voting Convertible Preferred Stock, or the Series B Certificate of Designation, was filed with the Secretary of State of the State of Delaware on July 2, 2024, F-26 Table of Contents and provided for the designation of shares of Series B Preferred Stock and authorized the issuance of 2,937,903 shares of Series B Preferred Stock. Additionally, on July 2, 2024, the Company entered into a securities purchase agreement, or the 2024 Securities Purchase Agreement, for a private investment in public equity financing, or the 2024 Private Placement, which provided for the issuance of 3,563,247 shares of common stock and 2,937,903 shares of Series B Non-Voting Convertible Preferred Stock, par value $ 0.0001 per share, or the Series B Preferred Stock, each at a purchase price of $ 20.00 per share to certain institutional and accredited investors, or the Purchasers. The Purchasers included (i) Timothy A. Springer, Ph.D., a member of the Company’s Board of Directors; (ii) TAS Partners LLC, an affiliate of Dr. Springer, and (iii) Chafen Lu, Ph.D., Dr. Springer’s wife. Pursuant to the 2024 Securities Purchase Agreement, the Company agreed to issue and sell an aggregate of 3,563,247 shares of common stock and 2,937,903 shares of Series B Preferred Stock for an aggregate purchase price of $ 130.0 million in the 2024 Private Placement. Each share of Series B Preferred Stock is convertible into one share of the Company’s common stock subject to stockholder approval of a proposal to issue such shares of common stock upon conversion of such shares of Series B Preferred Stock in accordance with the Listing Rules of the Nasdaq Stock Market LLC, or the Series B Conversion Proposal. Under the 2024 Securities Purchase Agreement, the Company issued 3,563,247 shares of common stock and 578,403 shares of Series B Preferred Stock for an aggregate purchase price of $ 82.8 million to the Purchasers other than Dr. Springer, TAS Partners LLC, and Dr. Lu. The Company also issued (i) 1,636,832 shares of Series B Preferred Stock to Dr. Springer, (ii) 721,361 shares of Series B Preferred Stock to TAS Partners LLC, and (iii) 1,307 shares of Series B Preferred Stock to Dr. Lu for an aggregate purchase price of $ 47.2 million. Pursuant to the 2024 Securities Purchase Agreement, the Company agreed to submit to its stockholders the approval of the Series B Conversion Proposal, at a special meeting of stockholders, which was held on September 20, 2024. On September 20, 2024, at such special meeting, the Company’s stockholders approved the Series B Conversion Proposal, among other matters. On September 25, 2024, pursuant to the terms of the Series B Certificate of Designation, 2,499,976 shares of Series B Preferred Stock automatically converted into 2,499,976 shares of common stock; 437,927 shares of Series B Preferred Stock did not automatically convert at such time due to beneficial ownership limitations. The Series B Preferred Stock were classified in permanent equity as there were no conditions that could have required cash redemption of the shares. F-27 Table of Contents The Series B Preferred Stock has the following rights and preferences: • Conversion: Prior to the stockholder approval of the Series B Conversion Proposal the Series B Preferred Stock were not convertible into shares of common stock. Following the stockholder approval of the Series B Conversion Proposal, each share of Series B Preferred Stock automatically converted into one share of common stock, subject to certain limitations, including that a holder of Series B Preferred Stock is prohibited from converting shares of Series B Preferred Stock into shares of common stock if, as a result of such conversion, such holder, together with its affiliates, would beneficially own more than a specified percentage (to be established by the holder between 0.0 % and 19.9 %) of the total number of shares of common stock issued and outstanding immediately after giving effect to such conversion; provided, however, that such beneficial ownership limitation does not apply to Dr. Springer, TAS Partners LLC, or any of their respective affiliates. Each share of Series B Preferred Stock outstanding that was not automatically converted into common stock as a result of the stockholder approval of the Series B Conversion Proposal shall be convertible at any time at the option of the holder following stockholder approval of the Series B Conversion Proposal, only to the extent the beneficial ownership limitation does not apply to the shares of Series B Preferred Stock to be converted. • Redemption: The Series B Preferred Stock is not redeemable. • Dividends: Holders of Series B Preferred Stock are entitled to receive dividends on shares of Series B Preferred Stock on an as-converted basis (without regard to the beneficial ownership limitation) equal to the dividends paid on shares of the common stock. • Voting: Except as otherwise required by law, the Series B Preferred Stock does not have voting rights. However, as long as any shares of Series B Preferred Stock are outstanding, the Company will not, without the affirmative vote of the holders of a majority of the then-outstanding shares of the Series B Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series B Preferred Stock, (b) alter or amend the Series B Certificate of Designation, or (c) amend the Charter or other organizational documents in any manner that alters or changes the preferences, rights, privileges, or powers of, or restrictions provided for the benefit of the holders of Series B Preferred Stock. • Liquidation: The holders of Series B Preferred Stock shall rank on parity with the holders of common stock and the holders of Series A Preferred Stock as to distributions of assets upon liquidation, dissolution or winding up of the Company, whether voluntarily or involuntarily. Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, each holder of Series B Preferred Stock shall be entitled to receive out of the assets of the Company, whether capital or surplus, the same amount that a holder of common stock would receive if the Series B Preferred Stock were fully converted, which shall be paid pari passu with holders of common stock and holders of Series A Preferred Stock, plus an amount equal to any dividends declared but unpaid. If the assets available for distribution are not sufficient to pay the holders of the Series B Preferred Stock pursuant to the preceding sentence, all remaining assets will be distributed ratably to the holders of the Series A Preferred Stock, Series B Preferred Stock and common stock. Series A Preferred Stock The Certificate of Designation of Preferences, Rights, and Limitations of the Series A Non-Voting Convertible Preferred Stock, or the Series A Certificate of Designation, was filed on November 13, 2023, which provided for the designation of shares of the Series A Preferred Stock and authorized the issuance of 548,375 shares of Series A Preferred Stock. Additionally on November 13, 2023, the Company entered into the 2023 Securities Purchase Agreement with (i) Timothy A. Springer, Ph.D., a member of the Company’s Board of Directors; (ii) TAS Partners LLC, an affiliate of Dr. Springer, and (iii) Seven One Eight Three Four Irrevocable Trust, a trust associated with Murat Kalayoglu, M.D. Ph.D., a co-founder and the former chief executive officer of Old Cartesian, who joined the Company’s Board of Directors effective immediately after the effective time of the Merger, or the Investors. Pursuant to the 2023 Securities Purchase Agreement, the Company agreed to issue and sell an aggregate of 149,330.115 shares of Series A Preferred Stock for an aggregate purchase price of $ 60.25 million in the 2023 Private Placement. In the 2023 Private Placement, Dr. Springer agreed to settle his purchases in three tranches of shares of Series A Preferred Stock, the first for a purchase price of $ 10.0 million and each thereafter for a purchase price of approximately $ 20.0 million, with the three tranches settling 30 , 60 , and 90 days, respectively, following the Closing Date. TAS Partners LLC agreed to settle its purchase for approximately $ 10.0 million within 30 days following the Closing Date. The first, second and third tranches were settled on December 13, 2023, January 12, 2024 and February 11, 2024, respectively, under which (i) 24,785.081 shares of Series A Preferred Stock were issued to each of TAS Partners LLC and Dr. Springer in the first tranche, (ii) 49,570.163 shares of Series A Preferred Stock were issued to Dr. Springer in the second tranche, and (iii) 49,570.163 shares of F-28 Table of Contents Series A Preferred Stock were issued to Dr. Springer in the third tranche. On November 15, 2023, the Company issued 619.627 shares of Series A Preferred Stock to Seven One Eight Three Four Irrevocable Trust for $ 0.25 million. The Company determined the obligation to issue 148,710.488 shares of Series A Preferred Stock to Dr. Springer and TAS Partners LLC represented a forward contract and was accounted for as a liability with changes in fair value recorded in earnings. A portion of the liability was settled with the initial issuance of 49,570.162 shares of Series A Preferred Stock on December 13, 2023. The remaining portion of the forward contract liability was settled upon the issuance of 49,570.163 shares of Series A Preferred Stock each on January 12, 2024 and February 11, 2024, respectively (see Note 6, “Fair Value Measurements”). On December 5, 2023, the Company issued 384,930.724 shares of Series A Preferred Stock as part of its consideration transferred in connection with the Merger which settled the related forward contract liability (see Note 6, “Fair Value Measurements”). On March 26, 2024, the Company, with the consent of the requisite holders of Series A Preferred Stock, amended the Series A Certificate of Designation such that the automatic conversion of the Series A Preferred Stock into common stock, or the Automatic Conversion, would occur eight business days following stockholder approval of the Conversion Proposal. On March 27, 2024, the Company’s stockholders approved the Conversion Proposal, among other matters, at the Special Meeting. On April 8, 2024, pursuant to the terms of the Series A Certificate of Designation, as amended, 367,919.247 shares of Series A Preferred Stock automatically converted into 12,263,951 shares of common stock, including the non-cash reclassification of an amount equal to the increase in par value of common stock from additional paid-in capital; 166,341.592 shares of Series A Preferred Stock did not automatically convert at such time due to beneficial ownership limitations. On October 11, 2024, pursuant to a Notice of Optional Conversion delivered to the Company by a holder of Series A Preferred Stock pursuant to the Series A Certificate of Designation, 45,551.190 shares of Series A Preferred Stock held by such holder were converted into 1,518,373 newly issued shares of common stock. In accordance with the guidance in ASC Topic 480, Distinguishing Liabilities from Equity (ASC 480) the Series A Preferred Stock was classified outside of stockholders’ deficit upon issuance and as of December 31, 2023 because the shares of Series A Preferred Stock contained redemption features that were not solely within the control of the Company. The Series A Preferred Stock was not currently redeemable, nor was it probable that the instrument would become redeemable, as it was only redeemable upon the occurrence of a contingent event. Accordingly, no accretion was recognized for the Series A Preferred Stock. As a result of the approval of the Conversion Proposal, all conditions that could have required cash redemption of the Series A Preferred Stock were removed. Since the Series A Preferred Stock was no longer redeemable, the associated balances of the Series A Preferred Stock were reclassified to permanent equity during the first quarter of 2024. F-29 Table of Contents The Series A Preferred Stock has the following rights and preferences: • Conversion: Prior to the stockholder approval of the Conversion Proposal, the Series A Preferred Shares were not convertible. Following the stockholder approval of the Conversion Proposal, each share of Series A Preferred Stock automatically converted into 33.333 shares of common stock, subject to certain limitations, including that a holder of Series A Preferred Stock is prohibited from converting shares of Series A Preferred Stock into shares of common stock if, as a result of such conversion, such holder, together with its affiliates, would beneficially own more than a specified percentage (to be established by the holder between 0 % and 19.9 %) of the total number of shares of common stock issued and outstanding immediately after giving effect to such conversion; provided, however, that such beneficial ownership limitation does not apply to Dr. Springer, TAS Partners LLC, or any of their respective affiliates. Each share of Series A Preferred Stock outstanding that was not otherwise automatically converted into common stock as a result of the beneficial ownership limitation shall be convertible at any time at the option of the holder following stockholder approval of the Conversion Proposal, only to the extent the beneficial ownership limitation does not apply to the shares of Series A Preferred Stock to be converted. • Redemption: Prior to the stockholder approval of the Conversion Proposal, each share of Series A Preferred Stock was redeemable at the option of the holder at any time following the date that was 18 months after the initial issuance date of the Series A Preferred Stock, other than any shares of Series A Preferred Stock that would not have been convertible into shares of common stock as a result of the beneficial ownership limitation referred to above. The amount payable upon redemption would have been equal to the average closing sale price of the common stock listed over the ten consecutive trading days ending on, and including, the day immediately prior to the redemption date multiplied by the number of shares of common stock the Series A Preferred Stock would have been convertible into. Following the Conversion Proposal, the Series A Preferred Stock is not redeemable. • Dividends: Holders of Series A Preferred Stock are entitled to receive dividends on shares of Series A Preferred Stock on an as-converted basis equal to the dividends paid on shares of the common stock; provided, however, that holders of Series A Preferred Stock (or any shares of common stock into which the Series A Preferred Stock are convertible) are not entitled to any CVRs or any amounts paid under the CVR Agreement. • Voting: Except as otherwise required by law, the Series A Preferred Stock does not have voting rights. However, as long as any shares of Series A Preferred Stock are outstanding, the Company will not, without the affirmative vote of the holders of a majority of the then-outstanding shares of the Series A Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series A Preferred Stock, (b) alter or amend the Series A Certificate of Designation, (c) amend the Charter or other organizational documents in any manner that adversely affects any rights of the holders of Series A Preferred Stock, (d) issue further shares of Series A Preferred Stock (other than in connection with the exercise of the stock options to purchase Series A Preferred Stock) or increase or decrease (other than by conversion) the number of authorized shares of Series A Preferred Stock, (e) prior to the stockholder approval of the Conversion Proposal or at any time while at least 30 % of the originally issued Series A Preferred Stock remains issued and outstanding, consummate either (A) a Fundamental Transaction (as defined in the Series A Certificate of Designation) or (B) any merger or consolidation of the Company or other business combination in which the stockholders of the Company immediately before such transaction do not hold at least a majority of the capital stock of the Company immediately after such transaction, (f) amend or fail to comply with, in any manner that would be reasonably likely to prevent, impede or materially delay the conversion (or the stockholder approval thereof), or terminate, any of the stockholder support agreements entered into in connection with the Merger, or the Support Agreements, or agree to any transfer, sale or disposition of such shares subject to the Support Agreements (except for such transfers, sales or dispositions with respect to which the approval of the Company is not required pursuant to the applicable Support Agreement) or (g) enter into any agreement with respect to any of the foregoing. • Liquidation: The holders of Series A Preferred Stock shall rank on parity with the common stockholders and the holders of Series B Preferred Stock as to distributions of assets upon liquidation, dissolution or winding up of the Company, whether voluntarily or involuntarily. Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary each holder of Series A Preferred Stock shall be entitled to receive out the assets of the Company equal to of the same amount that a holder of common stock would receive if the Series A Preferred Stock were fully converted, which shall be paid pari passu with holders of common stock and holders of Series B Preferred Stock, plus an amount equal to any dividends declared but unpaid. If the assets available for distribution are not sufficient to pay the holders of the Series A Preferred Stock pursuant to the preceding sentence, the assets will be distributed ratably to the holders of the Series A Preferred Stock, Series B Preferred Stock and common stock. As of December 31, 2025, the Company had 120,790.402 shares of Series A Preferred Stock and 437,927 shares of Series B Preferred Stock issued and outstanding, respectively, which are convertible into a total of 4,464,273 shares of common stock. F-30 Table of Contents 11. Equity Equity Financings “At the Market” Sales Agreement On December 13, 2024, the Company entered into a Sales Agreement, or the Sales Agreement, with Leerink Partners to sell shares of the Company’s common stock, from time to time, through an “at the market” equity offering program under which Leerink Partners will act as sales agent. The shares of common stock sold pursuant to the Sales Agreement will be issued pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-283803), filed on December 13, 2024 with the SEC and related prospectus supplement, filed on January 8, 2025 with the SEC, for aggregate gross sales proceeds of up to $ 100.0 million. As of December 31, 2025, no shares have been sold pursuant to the Sales Agreement. 2024 Private Placement On July 2, 2024, the Company and the Purchasers entered into the 2024 Securities Purchase Agreement for the 2024 Private Placement, which provided for the issuance of 3,563,247 shares of common stock and 2,937,903 shares of Series B Non-Voting Convertible Preferred Stock, par value $ 0.0001 per share, or the Series B Preferred Stock, each at a purchase price of $ 20.00 per share. The 2024 Private Placement resulted in gross proceeds of approximately $ 130.0 million before deducting placement agent fees and other offering expenses. See Note 10, “Convertible Preferred Stock.” Warrants The following is a summary of warrant activity for the years ended December 31, 2025 and 2024: Number of Warrants Equity classified Liability classified Total Weighted average exercise price Outstanding at December 31, 2023 74,420 966,393 1,040,813 $ 45.98 Exercises ( 65,681 ) — ( 65,681 ) $ 43.80 Expired ( 1,928 ) ( 280,681 ) ( 282,609 ) $ 44.09 Outstanding at December 31, 2024 6,811 685,712 692,523 $ 46.96 Expired ( 251 ) — ( 251 ) $ 526.50 Outstanding at December 31, 2025 6,560 685,712 692,272 $ 46.76 During the years ended December 31, 2025 and 2024, the Company recorded a gain of $ 3.7 million and $ 2.6 million, respectively, on the change in the fair value of the warrants in the consolidated statements of operations and comprehensive loss. Common Stock On April 4, 2024, the Company implemented the Reverse Stock Split. The Reverse Stock Split became effective at 4:30 p.m. Eastern Time on April 4, 2024. On April 5, 2024, the Company’s common stock began trading on The Nasdaq Global Market on a split-adjusted basis under the symbol “RNAC” with a new CUSIP number, 816212302. As a result of the Reverse Stock Split, every 30 shares of common stock outstanding were combined, automatically and without any action on the part of the Company or its stockholders, into one share of common stock. Stockholders entitled to fractional shares as a result of the Reverse Stock Split received a cash payment in lieu of receiving fractional shares. The Reverse Stock Split did not change the number of authorized shares or par value of the Company’s common or preferred stock. As of December 31, 2025, the Company had 350,000,000 shares of common stock authorized for issuance, $ 0.0001 par value per share, with 26,011,106 shares issued and outstanding. The voting, dividend and liquidation rights of the common stockholders are subject to and qualified by the rights, powers and preferences of the preferred stock. The common stock has the following characteristics: Voting Common stockholders are entitled to one vote for each share of common stock held with respect to all matters voted on by the stockholders of the Company. F-31 Table of Contents Dividends Common stockholders are entitled to receive dividends, if and when declared by the Board of Directors. Through December 31, 2025, no cash dividends have been declared or paid on common stock. Liquidation Upon liquidation of the Company, common stockholders are entitled to receive all assets of the Company available for distribution to such stockholders. Reserved Shares The Company has authorized shares of common stock for future issuance as of December 31, 2025 as follows: December 31, 2025 Exercise of warrants 692,021 Shares available for future stock incentive awards 4,148,684 Common stock options reserved for issuance 7,500 Unvested restricted stock units 522,498 Outstanding common stock options 2,463,747 Series A Preferred Stock 4,026,346 Series B Preferred Stock 437,927 Total 12,298,723 12. Stock Incentive Plans The Company maintained the 2008 Stock Incentive Plan, or the 2008 Plan, for employees, consultants, advisors, and directors. The 2008 Plan provided for the granting of incentive and non-qualified stock option and restricted stock awards as determined by the Board of Directors. In connection with the Merger, all outstanding awards issued under the 2008 Plan were cancelled, and the Board of Directors formally terminated the 2008 Plan. In June 2016, the Company’s stockholders approved the 2016 Incentive Award Plan, or the 2016 Plan, which authorized 40,341 shares of common stock for future issuance under the 2016 Plan and the Company ceased granting awards under the 2008 Plan. Upon the effective date of the 2016 Plan, awards issued under the 2008 Plan remained subject to the terms of the 2008 Plan. Awards granted under the 2008 Plan that expired, lapsed or terminated became available under the 2016 Plan as shares available for future grants. Additionally, pursuant to the terms of the 2016 Plan, the Board of Directors is authorized to grant awards with respect to common stock, and may delegate to a committee of one or more members of the Board of Directors or executive officers of the Company the authority to grant options and restricted stock units. On December 9, 2020, the Board of Directors established a Stock Option Committee authorized to grant awards to certain employees and consultants subject to conditions and limitations within the 2016 Plan. In June 2024, the Company’s stockholders approved an amendment and restatement of the 2016 Plan to reserve an additional 3,466,544 shares of the Company’s common stock for issuance. In January 2025, the number of shares of common stock that may be issued under the 2016 Plan was increased by 1,030,694 . As of December 31, 2025, 3,594,407 shares remain available for future issuance under the 2016 Plan. In September 2018, the Company’s 2018 Employment Inducement Incentive Award Plan, or the 2018 Inducement Incentive Award Plan was adopted by the Board of Directors without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Stock Market LLC listing rules, which authorized 39,166 shares of its common stock for issuance. In March 2019, the Board of Directors approved an amendment and restatement of the 2018 Inducement Incentive Award Plan to reserve an additional 66,667 shares of the Company’s common stock for issuance thereunder. In December 2023, the Board of Directors approved an amendment and restatement of the 2018 Inducement Incentive Award Plan to reserve an additional 60,833 shares of the Company’s common stock for issuance thereunder. In June and December 2024, the Board of Directors approved amendments and restatements of the 2018 Inducement Incentive Award Plan to reserve an additional 360,000 and 450,000 shares, respectively, of the Company’s common stock for issuance thereunder. As of December 31, 2025, there are 472,303 shares available for future grant under the 2018 Inducement Incentive Award Plan. In accordance with the Merger Agreement, the Company assumed Old Cartesian’s 2016 Stock Incentive Plan, or the Old Cartesian Plan. The Old Cartesian Plan permits the granting of options or restricted stock to employees, officers, directors, consultants and advisors to the Company. The unvested common stock options and Series A Preferred Stock options assumed F-32 Table of Contents by the Company in connection with the Merger generally vest over a four-year period. Additionally, the stock options granted have a contractual term of ten years and only full shares can be exercised as per the individual award agreements. As of December 31, 2025, there are 36,179 shares available for future grant under the Old Cartesian Plan. In connection with the Merger, the outstanding stock options to purchase Old Cartesian common stock were converted into stock options to purchase 776,865 shares of common stock and 14,112.299 shares of Series A Preferred Stock of the Company. These replacement awards were revalued at their acquisition-date fair value and then attributed to pre and post-combination service. This resulted in $ 2.6 million attributed to post-combination service to be recognized as stock-based compensation expense over the remaining terms of the replacement awards, of which $ 0.6 million and $ 1.3 million was recognized as research and development expense in the consolidated statements of operations and comprehensive loss during the years ended December 31, 2025 and 2024, respectively. Following the Automatic Conversion, the options exercisable for shares of Series A Preferred Stock became exercisable for shares of common stock. Stock-Based Compensation Expense In April 2025, the Company entered into a separation agreement and release, or the Kurtoglu Separation Agreement, with the Company’s former Chief Technology Officer, Metin Kurtoglu, M.D., Ph.D. Dr. Kurtoglu’s employment with the Company ended effective May 2025, and Dr. Kurtoglu agreed to serve as a consultant to the Company from May 2025 through April 2026, or the Kurtoglu Consulting Period. Pursuant to the Kurtoglu Separation Agreement, certain of Dr. Kurtoglu’s stock options and restricted stock unit awards were modified to accelerate the vesting of a portion of the awards, continue the vesting of the remaining awards during the Kurtoglu Consulting Period, and extend the post-termination exercise period of the modified stock options. The services performed during the Kurtoglu Consulting Period do not qualify as substantive services under ASC 718 and therefore, the continued vesting of these awards represents a modification to the original award. The modification resulted in the recognition of $ 0.7 million compensation expense during the year ended December 31, 2025, which is reflected in research and development expenses on the consolidated statements of operations and comprehensive loss. In October 2025, the Company entered into a separation agreement and release, or the Jewell Separation Agreement, with the Company’s former Chief Scientific Officer, Chris Jewell, Ph.D. Dr. Jewell’s employment with the Company ended effective November 2025, and Dr. Jewell will serve as a consultant to the Company from November 2025 to January 2026, or the Jewell Consulting Period. Pursuant to the Jewell Separation Agreement, certain of Dr. Jewell’s stock options and restricted stock unit awards were modified to continue the vesting of the remaining awards during the Jewell Consulting Period and extend the post-termination exercise period of the modified stock options. The services performed during the Jewell Consulting Period do not qualify as substantive services under ASC 718 and therefore, the continued vesting of these awards represents a modification to the original award. The modification resulted in the recognition of a reversal of $ 0.2 million in compensation expense during the year ended December 31, 2025, which is reflected in research and development expenses on the consolidated statements of operations and comprehensive loss. Stock-based compensation expense by classification included within the consolidated statements of operations and comprehensive loss was as follows (in thousands): Year Ended December 31, 2025 2024 Research and development $ 4,772 $ 3,217 General and administrative 5,749 3,365 Total stock-based compensation expense $ 10,521 $ 6,582 Stock Options The estimated grant date fair values of stock option awards granted under the 2016 Plan and the 2018 Inducement Incentive Award Plan were calculated using the Black-Scholes option pricing model based on the following weighted-average assumptions: Year Ended December 31, 2025 2024 Risk-free interest rate 4.36 % 4.02 % Dividend yield — — Expected term 6.18 6.21 Expected volatility 96.84 % 95.21 % Weighted-average fair value of common stock $ 16.23 $ 19.63 F-33 Table of Contents The expected term of the Company’s stock options granted has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. Under the simplified method, the expected term is presumed to be the midpoint between the vesting date and the end of the contractual term. The Company utilizes this method due to lack of historical exercise data and the plain nature of its stock-based awards. Expected volatilities are based on the Company’s historical volatility. The weighted average grant date fair value of stock options granted during the years ended December 31, 2025 and 2024 was $ 13.01 and $ 15.63 , respectively. The total intrinsic value of stock options exercised during the years ended December 31, 2025 and 2024 was $ 0.7 million and $ 7.0 million, respectively. As of December 31, 2025, total unrecognized compensation expense related to unvested common stock options was $ 12.0 million, which is expected to be recognized over a weighted average period of 2.6 years. The following table summarizes the stock option activity under the 2016 Plan, the 2018 Inducement Incentive Award Plan, and the Old Cartesian Plan for options for common stock: Number of common stock options Weighted-average exercise price ($) Weighted-average remaining contractual term (in years) Aggregate intrinsic value (in thousands) Outstanding at December 31, 2024 1,706,035 $ 11.99 7.59 $ 12,025 Granted 1,150,259 $ 16.23 Reserved for issuance ( 7,500 ) $ 3.30 Exercised ( 90,444 ) $ 3.29 Forfeited ( 294,603 ) $ 17.01 Outstanding at December 31, 2025 2,463,747 $ 13.72 6.41 $ 2,962 Vested at December 31, 2025 909,242 $ 7.95 4.07 $ 2,808 Vested and expected to vest at December 31, 2025 2,197,439 $ 13.29 6.49 $ 2,962 As a result of the approval of the Conversion Proposal on March 27, 2024, all conditions that could have required cash redemption of the Series A Preferred Stock underlying the stock options were removed. Since the Series A Preferred Stock was no longer redeemable, the associated balances of the stock options to purchase Series A Preferred Stock were reclassified to additional paid-in capital during the first quarter of 2024. Following the Automatic Conversion, all options to purchase Series A Preferred Stock were converted into options to purchase common stock with adjustments to the underlying number of shares of common stock determined by multiplying the number of shares of Series A Preferred Stock by 33.333 and rounding down to the nearest whole number of shares and the per-share exercise price by dividing the per-share exercise price of Series A Preferred Stock by 33.333 and rounding the resulting exercise price up to the nearest whole cent. Restricted Stock Units During the year ended December 31, 2025, the Company granted 262,590 restricted stock unit awards with a weighted average fair value of $ 16.74 per share based on the closing price of the Company’s common stock on the date of grant under the 2016 Plan, which generally vest over a four-year term. Forfeitures are estimated at the time of grant and are adjusted, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company has estimated a forfeiture rate of 10 % for restricted stock unit awards based on historical experience. The aggregate fair value of restricted stock unit awards that vested during year ended December 31, 2025 was $ 2.4 million. No restricted stock unit awards vested during the year ended December 31, 2024. Unrecognized compensation expense related to the restricted stock unit awards was $ 4.9 million as of December 31, 2025, which is expected to be recognized over a weighted-average period of 2.3 years. F-34 Table of Contents The following table summarizes the Company’s restricted stock units under the 2016 Plan and the Old Cartesian Plan: Number of shares Weighted average grant date fair value ($) Unvested at December 31, 2024 444,238 $ 19.86 Granted 262,590 $ 16.74 Vested ( 153,293 ) $ 19.86 Forfeited ( 31,037 ) $ 17.41 Unvested at December 31, 2025 522,498 $ 18.44 13. Revenue Arrangements Collaboration and license revenue Astellas Gene Therapies In January 2023, the Company entered into the License and Development Agreement, or the Astellas Agreement, with Audentes Therapeutics, Inc., or Astellas. Under the Astellas Agreement, the Company granted Astellas an exclusive license to the Company’s IdeXork technology arising from Xork, to develop and commercialize Xork for use in Pompe disease in combination with an Astellas gene therapy investigational or authorized product. Xork, Genovis’ IgG Protease, was licensed pursuant to an Exclusive License Agreement, or the Genovis Agreement, with Genovis AB (publ.), or Genovis, as described in Note 15, “Collaboration and License Agreements”. Astellas paid a $ 10.0 million upfront payment to the Company upon signing of the Astellas Agreement, and the Company was entitled to receive up to $ 340.0 million in future additional payments over the course of the partnership that were contingent on the achievement of various development and regulatory milestones and, if commercialized, sales thresholds for annual net sales where Xork is used as a pre-treatment for an Astellas investigational or authorized product. The Company was also eligible for tiered royalty payments ranging from low to high single digits. Any proceeds received from milestone payments or royalties relating to Xork would have been required to be distributed to holders of CVRs, net of certain deductions. Pursuant to the Astellas Agreement, the Company would have had the exclusive right and responsibility to complete research and development of Xork products and to conduct all preclinical studies and clinical trials for Xork for use in Pompe disease with an Astellas gene therapy investigational or authorized product, or the Xork Development Services. Astellas reimbursed the Company for 25 % of all budgeted costs incurred to complete the development of Xork for use in Pompe disease with an Astellas gene therapy investigational or authorized product. The Company would have had control and responsibility over regulatory filings, including any investigational drug applications, biologics license applications, and marketing authorization applications relating to the licensed product. Astellas would have had the exclusive right and responsibility to research, develop, and commercialize Astellas products used in combination with Xork and would have had control and responsibility over all regulatory filings, including any investigational drug applications, biologics license applications, and marketing authorization applications, relating to Astellas products and Astellas products used in combination with Xork. The Company determined the Astellas Agreement represented a service arrangement under the scope of ASC 606. The Company determined that the sublicense of Xork to Astellas, the licensed know-how, and the Xork Development Services represented a single promise and performance obligation to be transferred to Astellas over time due to the nature of the promises in the contract. As such, the Company recognized the transaction price as revenue utilizing the input method to measure the progress of satisfying the single performance obligation to Astellas. In determining the transaction price, the Company concluded the upfront payment of $ 10.0 million and development cost reimbursements of $ 5.5 million would be included in the initial transaction price. All other development milestones would be fully constrained and would only have been included in the transaction price when the applicable milestone was deemed probable of achievement. Each of these variable consideration items were evaluated under the most likely amount method to determine whether such amounts were probable of occurrence, or whether such amounts should have been constrained until they became probable. As part of its evaluation of the constraint, the Company considered numerous factors, including that receipt and timing of such development milestones was outside the control of the Company and probability of success criteria was estimated. The Company re-evaluated the transaction price in each reporting period, as uncertain events were resolved, or as other changes in circumstances occurred. In accordance with ASC 606, the Company would have only recognized revenue associated with sales-based milestones and royalties when the subsequent sales thresholds were reached and underlying sales occurred, respectively. The Company determined that a significant financing component did not exist in its arrangement with Astellas. The Company also determined the options to negotiate additional fields, enter into a clinical supply agreement, and F-35 Table of Contents enter into a commercial supply agreement did not represent material rights under the Astellas Agreement. Astellas had the right to terminate the Astellas Agreement in its entirety or on a field-by-field basis, upon 90 days’ written notice to the Company. In March 2024, the Company was notified by Astellas of its intention to terminate the Astellas Agreement, which occurred effective June 6, 2024. As of December 31, 2025 and 2024, there were no unsatisfied performance obligations related to the Astellas Agreement. As of December 31, 2025 the Company had no receivable balance related to the Astellas Agreement. As of December 31, 2024, the Company recorded a receivable of $ 0.1 million, representing billings for the Xork Development Services that were subject to reimbursement by Astellas. No revenue related to the Astellas Agreement was recognized during the year ended December 31, 2025. Revenue of $ 6.3 million related to the Astellas Agreement was recognized during the year ended December 31, 2024, inclusive of $ 3.2 million of revenue recognized from performance obligations related to prior periods as a result of the change in transaction price during the year ended December 31, 2024. Swedish Orphan Biovitrum AB (publ.) License and Development Agreement On June 11, 2020, the Company and Sobi entered into a License and Development Agreement. Pursuant to the Sobi License, the Company agreed to grant Sobi an exclusive, worldwide (except as to Greater China) license to develop, manufacture and commercialize the NASP drug candidate, which is currently in development for the treatment of chronic refractory gout. The NASP drug candidate is a pharmaceutical composition containing a combination of SEL-037, or the Compound, and ImmTOR. Pursuant to the Sobi License, in consideration of the license, Sobi agreed to pay the Company a one-time, upfront payment of $ 75.0 million. Sobi has also agreed to make milestone payments totaling up to $ 630.0 million to the Company upon the achievement of various development and regulatory milestones and, if commercialized, sales thresholds for annual net sales of NASP, and tiered royalty payments ranging from the low double digits on the lowest sales tier to the high teens on the highest sales tier. Any proceeds received from milestone payments or royalties relating to the Sobi License would be required to be distributed to holders of CVRs, net of certain deductions. Pursuant to the Sobi License, the Company agreed to supply (at cost) quantities of the Compound and ImmTOR as necessary for completion of the two Phase 3 clinical trials of NASP (DISSOLVE I and DISSOLVE II) and a six-month placebo extension. The Company was required to supply quantities of the Compound until all rights to the Compound and any materials needed to manufacture the Compound were transferred to Sobi, which transfer occurred upon the execution of Amendment No. 1 to the License and Development Agreement on October 31, 2023. Sobi has agreed to reimburse the Company for all budgeted costs incurred to complete development of NASP, including but not limited to costs incurred while conducting and completing the Phase 3 DISSOLVE trials, except for any costs of additional development activities required that are related to ImmTOR and that are unrelated to NASP. Sobi will have control and responsibility over all regulatory filings, including any investigational drug applications, or IND, biologics license applications, or BLA, and marketing authorization applications, or MAA relating to the licensed product. The transactions contemplated by the Sobi License were consummated on July 28, 2020. Sobi may terminate the Sobi License for any reason upon 180 days’ written notice to the Company, whereby all rights granted under the Sobi License would revert back to the Company. In addition, if Sobi were to terminate the Sobi License, the Company has the option to obtain a license to all patents and know-how necessary to exploit NASP in existence as of the termination date from Sobi in return for making an equitable royalty payment to Sobi. The Company determined that the Sobi License represents a service arrangement under the scope of ASC 606. In addition, given the Sobi License and Sobi Purchase Agreement were executed contemporaneously and negotiated as a package with a single commercial objective, the Company will account for the two agreements as a single contract. The term of the Sobi License commenced upon the effective date of July 28, 2020 and will continue on a product-by-product basis until the royalty terms for each country have expired. The royalty term for a given product begins upon the first commercial sale of the product in a country and ends at the later of ten years from the first commercial sale, expiration of the last valid patent claim covering the product and expiration of all regulatory exclusivity periods for the product in a country. Given the reversion of the rights under the Sobi License represents a penalty in substance for a termination by Sobi, the contract term would remain the stated term of the Sobi License. The Company determined that the Sobi License contained three distinct performance obligations due to the nature of the promises in the contract, which includes conducting the Phase 3 DISSOLVE trials, Sobi’s option to set-up a second source supplier, and a combined obligation comprised of the delivery of the license to NASP, transfer of the know-how and the manufacturing and delivery of NASP supply for development, or the Combined License Obligation. As the set-up of a second source supplier was optional for Sobi and the Company was to be reimbursed at cost for its efforts in the subsequent set-up and F-36 Table of Contents technology transfer, the option for this future service was determined to be at a significant and incremental discount to its standalone selling price and treated as a material right in the arrangement, namely a distinct performance obligation. In determining the transaction price, the Company concluded the upfront payment of $ 75.0 million and the $ 5.0 million development milestone associated with the dosing of the first patient in the Phase 3 DISSOLVE trials were included in the transaction price. All other development milestones will be fully constrained and only be included in the transaction price when the respective milestone is deemed probable of achievement. Each of these variable consideration items was evaluated under the most likely amount method to determine whether such amounts were probable of occurrence, or whether such amounts should be constrained until they become probable. As part of the evaluation of the constraint, the Company considered numerous factors, including that receipt of such milestones is outside the control of the Company and probability of success criteria is estimated. The Company re-evaluates the transaction price in each reporting period, as uncertain events are resolved. In accordance with ASC 606, the Company will only recognize revenue associated with sales-based milestones and royalties when the subsequent sales thresholds are reached and underlying sales occur, respectively. In connection with the Sobi Purchase Agreement, the Company determined that the gross proceeds of $ 25.0 million from the Sobi Private Placement included a premium to the fair value of the Company’s shares as of July 28, 2020 equal to approximately $ 14.5 million. The premium amount is included in the transaction price for revenue recognition. The Company estimates and includes in the transaction price the total reimbursements to be received from Sobi for both the manufacturing and delivery of the Compound and ImmTOR as well as conducting the Phase 3 DISSOLVE trials. The Company determined that a significant financing component does not exist in its arrangement with Sobi. The Company allocated the transaction price based on the relative standalone selling prices of the three distinct performance obligations. The Company estimated the standalone selling price of conducting the Phase 3 DISSOLVE trials by forecasting its anticipated costs and applying a margin reflective of the industry. The Company determined the standalone selling price of the second source supplier option by determining the discount given to Sobi multiplied by the likelihood that Sobi would have exercised the option in the future. Similar to the Phase 3 program estimate, the Company estimated the discount of the option by forecasting the set-up costs and applying a margin that is reflective of the industry. As the Company was to provide the set-up and technology transfer services and the future supply at cost, the discount of the option was equal to the margin amount. The Company considered discussions with Sobi as well as probability of regulatory success of NASP in determining the likelihood of exercise. The Company estimated the standalone selling price of the Combined License Obligation by utilizing a discounted cash flow model. The Company determined that the delivery of the supply to Sobi best represented the pattern of delivery of the Combined License Obligation as the supply was essential to the utility of the license and know-how. The Company recognized the revenue allocated to the Combined License Obligation by utilizing the output method. The Company estimated the total supply of the Compound and ImmTOR required during the clinical trial period and recognized revenue as this supply was shipped for use in the clinical trials. The Company recognized the revenue allocated to the conducting of the Phase 3 DISSOLVE trials obligation by utilizing the input method. The Company estimated the total budgeted costs to be incurred over the Phase 3 DISSOLVE trials and recognized revenue as these costs were incurred. The Company’s costs best represented the pattern of transfer as these captured all performance of the trials completed to date and were readily able to be measured. The Company was to recognize the revenue allocated to the second source supplier option when the future services and goods were transferred. On June 29, 2022, the Company completed enrollment of the DISSOLVE II trial. The completion of enrollment of the DISSOLVE II trial resulted in the achievement of a development milestone and a $ 10.0 million payment obligation from Sobi to the Company. This amount was added to the overall transaction price and payment was received during the year ended December 31, 2022. On October 31, 2023, the Company and Sobi entered into Amendment No. 1 to the License and Development Agreement, pursuant to which the Company granted Sobi an exclusive license to manufacture ImmTOR solely in connection with Sobi’s development of NASP under the License and Development Agreement and transferred certain contracts and manufacturing equipment to Sobi. Additionally, Sobi’s option to set-up a second source supplier was removed as a result of the amendment. Further, in connection with entry into the amendment, Sobi agreed to make employment offers to certain of the Company’s employees engaged in ImmTOR manufacturing activities on or prior to a specified date, and the Company agreed not to terminate the employment of such employees prior to such specified date. The Company maintains no responsibilities to Sobi to manufacture, or supply Sobi with, ImmTOR under the Sobi License. On June 28, 2024, Sobi initiated a rolling biologics license application to the FDA for NASP for the potential treatment of chronic refractory gout which resulted in the achievement of a development milestone and a $ 30.0 million payment obligation from Sobi to the Company. As a result, the development milestone was no longer constrained and $ 30.0 million was recognized as revenue during the year ended December 31, 2024 as there were no remaining performance obligations under the Sobi License. The proceeds from the achievement of the development milestone were received from Sobi in July 2024 and are were included, net of deductions as specified in the CVR Agreement, in the distribution to holders of the CVRs in March 2025. F-37 Table of Contents As of December 31, 2025 and 2024, the Company recorded a total outstanding receivable of $ 0.1 million, representing billings for the Phase 3 DISSOLVE program that are subject to reimbursement by Sobi. As of December 31, 2025 and 2024, there was no unbilled receivable outstanding. No revenue related to the Sobi License was recognized during the year ended December 31, 2025. Revenue of $ 31.9 million, inclusive of the $ 30.0 million development milestone, related to the Sobi License was recognized during the year ended December 31, 2024, and $ 1.9 million of revenue recognized from performance obligations related to prior periods as a result of the change in transaction price during the year ended December 31, 2024. Transaction Price Allocated to Future Performance Obligations Remaining performance obligations represent the transaction price of contracts for which work has not been performed, or has been partially performed. As of December 31, 2025, there were no unsatisfied performance obligations from contracts with customers. Grant revenue National Institute of Neurological Disorders and Stroke of the National Institutes of Health In June 2024, the Company received funding approval from the National Institute of Neurological Disorders and Stroke of the National Institutes of Health, or NINDS, for an award of $ 1.5 million granted for the budget period, which runs from June 2024 through May 2025. In June 2025, the Company received funding approval from NINDS for an additional award of $ 1.5 million granted for the budget period June 2025 through May 2026. The funding was provided by NINDS to further the Company’s use of RNA-based CAR-T cells to combat autoantibody-associated autoimmune disorders. Grant funding is to be used solely for manufacturing of RNA-based CAR-T cells and analysis of samples to inform mechanism of action. The award period runs through May 31, 2026. The Company will recognize grant revenue when expenses reimbursable under the grant have been incurred. As of December 31, 2025 and 2024, the Company recorded a receivable of $ 0.9 million and $ 0.6 million, respectively, that are subject to reimbursement by NINDS. The Company recognized grant revenue of $ 2.3 million and $ 0.6 million during the years ended December 31, 2025 and 2024, respectively. 14. Related-Party Transactions 2024 Securities Purchase Agreement On July 2, 2024, the Company entered into the 2024 Securities Purchase Agreement with the Purchasers. The Purchasers included (i) Timothy A. Springer, Ph.D., a member of the Company’s Board of Directors, (ii) TAS Partners LLC, an affiliate of Dr. Springer, and (iii) Chafen Lu, Ph.D., Dr. Springer’s wife (see Note 11 “Equity”). The below issuances and sales to related parties of the Company were made during the year ended December 31, 2024. Name Shares of Series B Preferred Stock purchased Total aggregate purchase price (in thousands) Timothy A. Springer, Ph.D. 1,636,832 $ 32,737 TAS Partners LLC, affiliate of Timothy A. Springer, Ph.D. 721,361 $ 14,427 Chafen Lu, Ph.D., wife of Timothy A. Springer, Ph.D. 1,307 $ 26 2023 Securities Purchase Agreement On November 13, 2023, the Company entered into the 2023 Securities Purchase Agreement with (i) Timothy A. Springer, Ph.D., (ii) TAS Partners LLC, and (iii) Seven One Eight Three Four Irrevocable Trust, a trust associated with Murat Kalayoglu, M.D., Ph.D., in which the Company agreed to issue and sell an aggregate of 149,330.115 shares of Series A Preferred Stock for an aggregate purchase price of $ 60.25 million (see Note 11 “Equity”). The 2023 Private Placement included a delayed settlement mechanism, and as a result, the below issuances and sales to related parties of the Company were made during the year ended December 31, 2024. F-38 Table of Contents Name Shares of Series A Preferred Stock purchased Total aggregate purchase price (in thousands) Timothy A. Springer, Ph.D. 99,140.326 $ 40,000 Exercise of Amended 2019 Warrants On March 26, 2024, TAS Partners LLC exercised 65,681 Amended 2019 Warrants, paid the per-share exercise price of $ 43.80 in cash for an aggregate exercise price of $ 2.9 million, and received 65,681 shares of common stock and 1,970,443 CVRs. 15. Collaboration and License Agreements Biogen MA, Inc. On September 8, 2023, the Company entered into a non-exclusive, sublicensable, worldwide, perpetual patent license agreement, or the Biogen Agreement, with Biogen MA, Inc., or Biogen to research, develop, make, use, offer, sell and import products or processes containing or using an engineering T-cell modified with an mRNA comprising, or encoding a protein comprising, certain sequences licensed under the Biogen Agreement for the prevention, treatment, palliation and management of autoimmune diseases and disorders, excluding cancers, neoplastic disorders, and paraneoplastic disorders. The Company is not obligated to pay Biogen any expenses, fees, or royalties. The Company may terminate the Biogen Agreement for any reason or no reason, and Biogen may terminate the agreement after a notice-and-cure period of 30 days if the Company fails to pay a fee owed to Biogen or for any other material breach of the agreement. The Biogen Agreement will otherwise expire when all claims of all issued patents within the patents and patent applications licensed to the Company under the Biogen Agreement have expired or been finally rendered revoked, invalid or unenforceable by a decision of a court or government agency. The Biogen Agreement encompasses patents and patent applications in the PCT/US2010/026825 patent family, which was filed March 10, 2010. In general, all patents that issue in this family have an expected expiration date of March 10, 2030, subject to potential patent term adjustments and/or extensions. For the U.S. patents and applications in this family, U.S. Patent 9,034,324 was awarded 677 days of patent term adjustment, which would extend the expiration date of this patent to January 16, 2032, absent any challenges to the patent term. The other issued patent in this family was not awarded any patent term adjustment, so its expected expiration date is March 10, 2030. National Cancer Institute of the National Institutes of Health Effective September 16, 2019, the Company entered into a nonexclusive, worldwide license agreement, or the NCI Agreement, with the U.S. Department of Health and Human Services, represented by the National Cancer Institute of the National Institutes of Health, or NCI. Under the NCI Agreement, the Company was granted a license under certain NCI patents and patent applications designated in the agreement, to make, use, sell, offer and import products and processes within the scope of the patents and applications licensed under the NCI Agreement when developing and manufacturing anti-BCMA CAR-T cell products for the treatment of myasthenia gravis, pemphigus vulgaris, and immune thrombocytopenic purpura according to methods designated in the NCI Agreement. In connection with the Company’s entry into the NCI Agreement, Old Cartesian paid to NCI a one-time $ 0.1 million license royalty payment. Under the NCI Agreement, the Company is further required to pay NCI a low five-digit annual royalty. The Company must also pay earned royalties on net sales in a low single-digit percentage and pay up to $ 0.8 million in benchmark royalties upon the Company’s achievement of designated benchmarks that are based on the commercial development plan agreed between the parties. Under the NCI Agreement, the Company must use reasonable commercial efforts to bring licensed products and licensed processes to the point of Practical Application (as defined in the NCI Agreement). Upon the Company’s first commercial sale, the Company must use reasonable commercial efforts to make licensed products and licensed processes reasonably accessible to the United States public. After the Company’s first commercial sale, the Company must make reasonable quantities of licensed products or materials produced via licensed processes available to patient assistance programs and develop educational materials detailing the licensed products. Unless the Company obtains a waiver from NCI, the Company must have licensed products and licensed processes manufactured substantially in the United States. Prior to the first commercial sale, upon NCI’s F-39 Table of Contents request, the Company is obligated to provide NCI with commercially reasonable quantities of licensed products made through licensed processes to be used for in vitro research. Additionally, the Company must use reasonable commercial efforts to submit a BLA with respect to a licensed product by the fourth quarter of 2026 and make a first commercial sale of a licensed product by the fourth quarter of 2028. The NCI Agreement terminates upon the expiration of the last to expire of the patent rights licensed thereunder, if not sooner terminated. The NCI Agreement encompasses patents and patent applications in the PCT/US2013/032029 patent family, which was filed March 15, 2013. In general, all patents that issue in this family have an expected expiration of March 15, 2033, subject to potential patent term adjustments and/or extensions. For the U.S. patents and applications in this family, only two patents were awarded patent term adjustments. U.S. Patent 9,765,342 was awarded 297 days of patent term adjustment, which would extend the expiration date of this patent to January 6, 2034, absent any challenges to the patent term. The other patent, U.S. Patent 10,876,123, was awarded three days of patent term adjustment, but this patent is subject to terminal disclaimers filed against other family members, so this patent will not extend beyond the March 15, 2033 date. The other issued patents in this family were not awarded any patent term adjustment, so the expected expiration date for these patents also remains March 15, 2033. There is also a pending patent application which, if issued, will expire on March 15, 2033, but could also be subject to patent term adjustment and to any potential future terminal disclaimers. NCI has the right to terminate the NCI Agreement, after giving written notice and providing a cure period in accordance with its terms, if the Company is in default of a material obligation. The Company has the unilateral right to terminate the agreement in any country or territory by giving NCI 60 days’ written notice. The Company agreed to indemnify NCI against any liability arising out of the Company’s, sublicensees’ or third-parties’ use of the licensed patent rights and licensed products or licensed processes developed in connection with the licensed patent rights. Genovis AB (publ.) License Agreement On October 21, 2021, the Company entered into the Genovis Agreement with Genovis. Under the Genovis Agreement, the Company paid to Genovis an upfront payment in exchange for an exclusive license to the Xork enzyme technology across all therapeutic uses in humans, excluding research, preclinical, diagnostic and other potential non-therapeutic applications of the enzyme. Genovis was eligible to earn from the Company development and sales-based milestones and sublicensing fees. The Genovis Agreement was assessed for collaboration components and was determined not to be within the scope of ASC 808 as the risk and rewards are not shared by both parties. The Company was to expense costs related to the Genovis Agreement as incurred until regulatory approval was received in accordance with ASC 730. The Company would have assessed the capitalization of costs incurred after the receipt of regulatory approval and, if applicable, would have amortized these payments based on the expected useful life of each asset, typically based on the expected commercial exclusivity period. The Company was also obligated to pay Genovis tiered royalties of low double digit percentages of worldwide annual net sales of collaboration products which would have been expensed as the commercial sales occurred. In February 2023, the Company made a $ 4.0 million payment to Genovis as a result of the sublicense of Xork to Astellas. See Note 13, “Revenue Arrangements” to these consolidated financial statements for further discussion on the Astellas Agreement. In March 2024, the Company notified Genovis of its intention to terminate the Genovis Agreement, which occurred effective September 13, 2024. Shenyang Sunshine Pharmaceutical Co., Ltd In May 2014, the Company entered into a license agreement, or the 3SBio License, with Shenyang Sunshine Pharmaceutical Co., Ltd., or 3SBio. The Company has paid to 3SBio an aggregate of $ 7.0 million in upfront and milestone-based payments under the 3SBio License as of December 31, 2025. The Company is required to make future payments to 3SBio contingent upon the occurrence of events related to the achievement of clinical and regulatory approval milestones of up to an aggregate of $ 15.0 million for products containing the Company’s ImmTOR platform. 16. Income Taxes The Company provides for income taxes under ASC 740. Under ASC 740, the Company provides deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the Company’s financial statement carrying amounts and the tax bases of assets and liabilities using enacted tax rates expected to be in effect in the years in which the differences are expected to reverse. F-40 Table of Contents On November 13, 2023, the Company acquired, in accordance with the terms of the Merger Agreement, the assets of Old Cartesian. In accordance with ASC 805-740-25-3, recognition of deferred tax assets and liabilities is required for substantially all temporary differences and acquired tax carryforwards and credits. The Company does not have a tax basis in IPR&D booked as part of the purchase accounting. For accounting purposes, the IPR&D will not be amortized and only subject to impairment review and testing. Though the tax effects may be delayed indefinitely, ASC 740-10-55-63 states that “deferred tax liabilities may not be eliminated or reduced because a reporting entity may be able to delay the settlement of those liabilities by delaying the events that would cause taxable temporary differences to reverse”. The Company can potentially only utilize indefinite-lived assets as it relates to this indefinite lived intangible deferred tax liability reversal. As such, the Company booked a deferred tax liability for the portion of the liability that cannot be reduced based on scheduling through the year ended December 31, 2025. For the year ended December 31, 2025, the Company recognized a current tax benefit of $ 9.2 million. For the year ended December 31, 2024, the Company recognized a current tax expense of $ 0.3 million. The components of the benefit (expense) for income taxes for the years ended December 31, 2025 and 2024 consisted of the following (in thousands): Year Ended December 31, 2025 2024 Deferred: Federal $ 571 $ 97 State 8,622 ( 384 ) Total deferred 9,193 ( 287 ) Income tax benefit (expense) $ 9,193 $ ( 287 ) The following table reconciles the federal statutory income tax rate to the Company’s effective income tax rate after applying ASU 2023-09 prospectively for the year ended December 31, 2025 (in thousands, except for percentages): Year Ended December 31, 2025 Expected tax benefit $ 29,256 21.0 % Nontaxable or nondeductible items 203 0.1 % State and local taxes, net of federal benefit 3,206 2.3 % Effect of changes in tax laws or rates enacted in the current period 3,604 2.6 % Change in valuation allowance, net ( 31,573 ) ( 22.6 ) % Tax credits: Orphan drug credits 3,959 2.8 % Research tax credits 892 0.6 % Other reconciling items: Change in fair value of the CVR liability ( 714 ) ( 0.5 ) % Other 360 0.3 % Income tax benefit (expense) $ 9,193 6.6 % The following table reconciles the federal statutory income tax rate to the Company’s effective income tax rate prior to the adoption of ASU 2023-09 for the year ended December 31, 2024: F-41 Table of Contents Year Ended December 31, 2024 Statutory U.S. federal rate 21.0 % State income taxes - net of federal benefit 10.5 % Permanent items 1.0 % Research tax credits 0.3 % Change in fair value of the CVR liability 127.9 % Change in fair value of forward contract liabilities ( 1.9 ) % Valuation allowance, net ( 160.1 ) % Stock-based compensation 0.9 % Effective income tax rate ( 0.4 ) % The tax effects of temporary differences that give rise to the Company’s net deferred tax assets are as follows (in thousands): Year Ended December 31, 2025 2024 Deferred Tax Assets Net operating loss carryforwards $ 60,899 $ 44,062 Research and development credits 10,724 6,024 Stock-based compensation expense 2,601 1,070 Patent and license costs 8,340 8,540 Deferred revenue 80,769 75,567 Operating lease liabilities 3,729 3,848 Contingent value right liability 115,330 108,832 Research & experimental expenditure capitalization 36,820 26,863 Other expenses 588 — Gross deferred tax assets $ 319,800 $ 274,806 Deferred Tax Liabilities Intangible assets $ ( 27,619 ) $ ( 41,441 ) Depreciation ( 571 ) ( 115 ) Operating lease right-of-use assets ( 1,648 ) ( 1,523 ) Gross deferred tax liabilities $ ( 29,838 ) $ ( 43,079 ) Net deferred tax assets before valuation allowance $ 289,962 $ 231,727 Valuation allowance ( 296,910 ) ( 247,867 ) Net deferred tax liabilities $ ( 6,948 ) $ ( 16,140 ) The Company has provided a full valuation allowance against its net deferred tax assets, outside of the indefinite tax liability booked as part of the Merger. The Company believes that it is more likely than not that the net deferred tax assets will not be realized. Realization of future tax benefits is dependent on many factors, including the Company’s ability to generate taxable income. The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets and concluded that it is more likely than not that the Company will not realize the benefit of its net deferred tax assets. The valuation allowance increased by $ 49.0 million for the year ended December 31, 2025, primarily as a result of tax loss and an increase in research and experimental, or R&E, expenditure capitalization in the current year. The valuation allowance increased by $ 123.6 million for the year ended December 31, 2024, primarily as a result of tax loss in the current year and a tax benefit determined in the year for the Company’s CVR liability. At December 31, 2025, the Company has federal net operating loss, or NOL, carryforward of $ 209.0 million, which can be carried forward indefinitely, subject to an 80% limitation and state net operating loss carryforward of $ 265.2 million, of which $ 128.6 million has an unlimited carryforward, subject to an 80% limitation, and the remaining $ 136.6 million will expire at various times through 2045. The Company has $ 10.0 million and $ 0.9 million, respectively, of federal and state research and development tax credit carryforwards, which will expire at various times through 2045. Utilization of the NOL carryforwards F-42 Table of Contents and research and orphan drug credit carryforwards may be subject to a substantial annual limitation under Section 382 of the Internal Revenue Code of 1986, as amended, or the Code, and similar state law due to ownership changes that could occur in the future. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. If the Company experiences a change of control, as defined by Section 382 of the Code and similar state law, utilization of the NOL carryforwards or research and orphan drug credit carryforwards may be subject to an annual limitation under Section 382 of the Code, which is determined by first multiplying the value of the Company’s stock at the time of the ownership change by the applicable long-term tax-exempt rate, and then could be subject to additional adjustments, as required. Any limitation may result in expiration of a portion of the NOL carryforwards or research and orphan drug credit carryforwards before utilization. The Company performed an analysis of ownership changes through December 31, 2023. Based on this analysis, the Company does not believe that any of its tax attributes through December 31, 2023 will expire unutilized due to Section 382 limitations. To the extent the Company enters into future equity transactions, there could be a limitation on the Company’s tax attributes. The Company applies ASC 740, Income Taxes to uncertain tax positions. As of the adoption date on January 1, 2010 and through December 31, 2025, the Company had no unrecognized tax benefits or related interest and penalties accrued. As of December 31, 2025, the Company has not completed a detailed study of its research and development and orphan drug credits for the tax years ending December 31, 2023 through December 31, 2025 . As a result, the Company will adjust its deferred tax asset balances and include the impacts in the research tax credits and state income taxes – net of federal benefit lines in the effective rate reconciliation next year, once the updated study has been completed. On July 4, 2025, the One Big Beautiful Bill Act, or OBBBA, was enacted. The OBBBA amends U.S. tax law including provisions related to domestic R&E expenses and bonus depreciation, among others. The provision related to domestic R&E allows for immediate expensing of domestic R&E costs along with accelerated deductions on previously capitalized domestic R&E costs. The Company has included impacts for the provisions in effect for tax years beginning after December 31, 2024 in its financial statements for the year ending December 31, 2025. The OBBBA had no impact on the Company's current or deferred tax expense as the Company is in a tax loss position and maintains a valuation allowance. Interest and penalty charges, if any, related to unrecognized tax benefits would be classified within income tax benefit (expense) in the accompanying consolidated statements of operations and comprehensive loss. As of December 31, 2025, the Company had no accrued interest related to uncertain tax positions. The statute of limitations for assessment by the Internal Revenue Service and state tax authorities is open for tax years 2020 to the present. To the extent the Company has tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service, or state tax authorities to the extent utilized in a future period. The Company files income tax returns in the United States, Massachusetts, and Maryland. There are currently no federal, state or foreign audits in progress. 17. Employee Benefit Plan The Company maintains a defined contribution plan, or the 401(k) Plan, under Section 401(k) of the Internal Revenue Code. The 401(k) Plan covers all employees who meet defined minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pretax basis. The 401(k) Plan provides for matching contributions on a portion of participant contributions pursuant to the 401(k) Plan’s matching formula. All matching contributions vest ratably over two years and participant contributions vest immediately. Contributions by the Company totaled $ 0.4 million and $ 0.2 million during the years ended December 31, 2025 and 2024, respectively. 18. Commitments and Contingencies As of December 31, 2025, the Company was not a party to any litigation that could have a material adverse effect on the Company’s business, financial position, results of operations or cash flows. Other As permitted under Delaware law, the Company indemnifies its officers, directors, consultants and employees for certain events or occurrences that happen by reason of the relationship with, or position held at, the Company. Through December 31, 2025, the Company had not experienced any losses related to these indemnification obligations, and no claims were outstanding. The Company does not expect significant claims related to these indemnification obligations and, consequently, concluded that the fair value of these obligations is negligible, and no related reserves were established. F-43 Table of Contents Additionally, as permitted under Delaware law, the Company indemnifies its directors for certain events or occurrences while the director is, or was, serving at the Company’s request in such capacity. The term of the indemnification is for the director’s lifetime. The maximum potential amount of future payments the Company could be required to make is unlimited; however, the Company has directors’ insurance coverage that limits its exposure and enables it to recover a portion of any future amounts paid. The Company also has indemnification arrangements under certain of its facility leases that require it to indemnify the landlord against certain costs, expenses, fines, suits, claims, demands, liabilities, and actions directly resulting from certain breaches, violations, or non-performance of any covenant or condition of the Company’s lease. The term of the indemnification is for the term of the related lease agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. To date, the Company had not experienced any material losses related to any of its indemnification obligations, and no material claims with respect thereto were outstanding. The Company is a party in various other contractual disputes and potential claims arising in the ordinary course of business. The Company does not believe that the resolution of these matters will have a material adverse effect the Company’s business, financial position, results of operations or cash flows. 19. Restructuring In April 2023, in light of current market conditions, the Board of Directors took steps to extend the Company’s cash runway by pausing further development of the Company’s product candidate, SEL-302, for the treatment of methylmalonic acidemia and conducting a targeted headcount reduction. On August 17, 2023, the Company announced additional steps to extend cash runway and maximize value for stockholders by continuing to prioritize development of the Company’s product candidate, NASP, and support of its collaboration with Astellas for Xork, and pausing further development of all of the Company’s other clinical and preclinical product candidates that it was no longer actively advancing. As a result of these measures, the Company implemented a restructuring plan that resulted in an approximate 90 % reduction of the Company’s headcount as of April 2023. The following table summarizes the change in the Company’s accrued restructuring balance included in accrued expenses and other current liabilities on its consolidated balance sheets (in thousands): December 31, 2023 Charges Cash Payments December 31, 2024 Severance liability $ 3,896 $ 798 $ ( 4,614 ) $ 80 December 31, 2024 Charges Cash Payments December 31, 2025 Severance liability $ 80 $ — $ ( 80 ) $ — The Company recognized restructuring expenses consisting of one-time cash severance payments and other employee-related costs. The Company recorded these restructuring charges based on each employee’s role to the respective research and development and general and administrative operating expense categories on its consolidated statements of operations and comprehensive loss. For the year ended December 31, 2025, the Company recognized no restructuring charges . For the year ended December 31, 2024, the Company recognized $ 0.2 million in research and development expenses and $ 0.6 million in general and administrative expenses . Payments for the restructuring plan were completed in the first quarter of 2025. F-44 Table of Contents 20. Segment Reporting Factors used in determining the reportable segment include the nature of the Company’s operating activities, the organizational and reporting structure and the type of information reviewed by the CODM to allocate resources and evaluate financial performance. The accounting policies of the segment are the same as those described in Note 2 “Summary of Significant Accounting Policies”. The following table presents selected financial information with respect to the Company’s single operating segment for the years ended December 31, 2025 and 2024 (in thousands): Year Ended December 31, 2025 2024 Revenue: Collaboration and license $ 400 $ 38,275 Grant 2,397 638 Total revenues 2,797 38,913 Less: Operating expenses: Legacy Selecta programs — 6,150 Descartes-08 for MG 22,893 12,142 Early stage programs 5,795 1,028 Research and development employee expenses 16,826 11,952 Research and development stock-based compensation expense 4,772 3,217 Research and development facilities and other expenses 7,748 10,616 General and administrative 31,468 30,126 Impairment of indefinite-lived intangible and long-lived assets 56,700 7,579 Other (income) expense, net (1) ( 13,103 ) 33,527 Net loss $ ( 130,302 ) $ ( 77,424 ) (1) Includes interest income; gain on change in fair value of warrant liabilities; loss on change in fair value of contingent value right liability; loss on change in fair value of forward contract liabilities; other (expense) income, net and income tax benefit (expense). 21. Subsequent Events The Company has evaluated subsequent events through the date on which the consolidated financial statements were issued. The Company has concluded that no subsequent events have occurred that require disclosure. F-45